8-KMaterial AgreementsExhibits & Filings

EDISON INTERNATIONAL 8-K Report, Material Agreement (Aug 26, 2005)

Filed August 26, 2005For Securities:EIX

Summary

This 8-K filing from Edison International (EIX) reports on a material definitive agreement related to the retirement and subsequent consulting arrangement for Robert Foster, a named executive officer and President of its subsidiary, Southern California Edison (SCE). Effective September 30, 2005, Mr. Foster will resign as President and retire on December 31, 2005. He will then transition to a three-year consulting role for SCE commencing January 1, 2006. The agreement outlines significant compensation and benefits for Mr. Foster, including continued salary and benefits until retirement, an additional payment of $160,000, and a pro-rated bonus for 2005. His outstanding equity awards will generally vest, with specific provisions for stock options. Upon retirement, he is entitled to annuity payments, accrued retirement plan benefits, and a lump sum to cover taxes. The structure of these payments is designed to comply with potential government service conflict of interest rules. The consulting agreement details a monthly retainer of $25,000, potential hourly pay for excess hours, and an annual performance bonus of up to $200,000, along with expense reimbursement.

Key Highlights

  • 1Robert Foster, President of Southern California Edison (SCE), is retiring effective December 31, 2005.
  • 2Mr. Foster will transition to a three-year consulting role for SCE starting January 1, 2006.
  • 3The retirement package includes continued compensation and benefits until retirement, a $160,000 payment, and a pro-rated 2005 bonus.
  • 4Outstanding equity awards, including stock options, will generally vest, with modifications for certain options.
  • 5Upon retirement, Mr. Foster will receive annuity payments and lump sums for accrued retirement benefits, structured to comply with conflict of interest regulations.
  • 6The consulting agreement provides a $25,000 monthly retainer, potential hourly compensation, and an annual performance bonus of up to $200,000.
  • 7The agreements include provisions for Mr. Foster's potential future government service and non-disclosure of confidential information.

Frequently Asked Questions

The filing details compensation and benefits associated with Mr. Foster's retirement and consulting services. Investors should refer to the specific terms outlined in the Retirement and Consulting Agreements, including the $160,000 payment, potential bonus for 2005, annuity payments, accrued retirement benefits, and the $25,000 monthly retainer for consulting, plus potential bonuses and hourly rates. The exact total financial outlay will depend on the duration of consulting services and any bonuses awarded.

The agreements include clauses designed to ensure compliance with federal and state conflict of interest rules applicable to public officials. This is particularly relevant if Mr. Foster decides to enter governmental service, impacting his retirement payments, option vesting, and the terms of the consulting agreement.

Mr. Foster will serve as a consultant to SCE for three years starting January 1, 2006. He will receive a base retainer of $25,000 per month, with additional hourly compensation if he works over 700 hours annually. He is also eligible for an annual performance bonus of up to $200,000 at the discretion of SCE's CEO, and SCE will reimburse reasonable travel expenses.

Outstanding equity awards will generally vest and be paid according to their terms. All of Mr. Foster's outstanding options will become fully vested on December 31, 2005. Options granted in 2002 and 2003 become exercisable in early 2006. Options from 2004 and 2005 vest according to the original schedule. His outstanding dividend equivalents will be paid, except for those subject to existing deferral elections beyond December 31, 2005.