NOTICE
OF 2017 ANNUAL MEETING OF
SHAREHOLDERS
Meeting Information
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Date:
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Thursday, April 27,
2017
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Time:
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9:00 a.m., Pacific
Time
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Location:
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Hilton Los
Angeles/San Gabriel
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Hotel 225 West Valley
Blvd.
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San
Gabriel, California 91776
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Important Notice
Regarding the Availability of Proxy Materials for the Annual Meeting to Be Held
on April 27, 2017:
The Proxy
Statement and Annual Report are available at
www.edison.com/annualmeeting.
Directions to the Annual Meeting and information on how to vote your
proxy are included in the Proxy Statement.
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Items To
Be Voted On
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By Edison
International (EIX)
Shareholders
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By Southern
California
Edison Company
(SCE) Shareholders
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Board
Recommendation
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1
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Election of Directors
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9 Nominees
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10 Nominees
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Vanessa C.L. Chang
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✓
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✓
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For
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Louis Hernandez, Jr.
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✓
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✓
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For
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James T. Morris
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✓
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✓
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For
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Kevin M. Payne
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✓
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For
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Pedro J. Pizarro
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✓
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✓
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For
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Linda G. Stuntz
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✓
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✓
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For
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William P. Sullivan
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✓
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✓
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For
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Ellen O. Tauscher
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✓
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✓
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For
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Peter J. Taylor
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✓
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✓
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For
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Brett White
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✓
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✓
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For
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2
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Ratification of the Appointment
of the Independent Registered Public
Accounting Firm
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✓
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✓
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For
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3
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Advisory Vote to Approve the
Companys Executive Compensation
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✓
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✓
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For
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4
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Advisory Vote on the Frequency of
Say-on-Pay Votes
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✓
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✓
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1 Year
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5
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Shareholder Proposal Regarding
Shareholder Proxy Access Reform
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✓
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Against
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EIX and SCE shareholders may also vote
on any other matters properly brought before the meeting.
RECORD DATE
Only shareholders at the close of business on March 3, 2017 are entitled
to receive notice of and to vote at the Annual Meeting.
SOLICITATION OF PROXIES
The EIX and SCE Boards of Directors are soliciting proxies
from you for use at the Annual Meeting, or at any adjournment or postponement of
the meeting. Proxies allow designated individuals to vote on your behalf at the
Annual Meeting.
Dated: March 17,
2017
For the Boards of
Directors,
Barbara E.
Mathews
Vice President, Associate
General Counsel,
Chief Governance Officer and Corporate
Secretary
Edison
International
Southern California Edison
Company
ii
Table of
Contents
TABLE OF
CONTENTS
Table of Contents
The information below is presented to assist shareholders in
reviewing the proposals to be voted on at the Annual Meeting. For more
complete information about these topics, please review the Companys
complete Proxy Statement and Annual
Report.
|
Our Business, Strategy, and
Financial Highlights
EIXs core business is conducted by its subsidiary SCE, a rate-regulated
electric utility that supplies electric energy to approximately 15 million
people in a 50,000 square-mile area of southern California. Our mission is to
safely provide customers reliable, affordable and clean electricity. Our
strategy has three key elements:
●
|
Invest in our infrastructure to
maintain a safe and reliable transmission and distribution
network.
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●
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Modernize the electric grid to
enable increased penetration of distributed energy resources to support
Californias climate change and greenhouse gas reduction objectives and
empower our customers to make new energy technology
choices.
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●
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Promote operational and service
excellence to enhance performance in the areas of safety, reliability,
customer satisfaction, and cost.
|
This strategy is intended to provide a foundation for long-term
sustainable growth and shareholder value.
Significant results for EIX include:
●
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2016 consolidated core earnings
of $3.97 per share exceeded our goal of $3.91 per share;
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●
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One-year (2016) total shareholder
return (TSR) of
24.9% exceeded the Philadelphia Utility Index, which had
a TSR of
17.4%;
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●
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Three-year (2014-2016) TSR
of
68.6% exceeded the Philadelphia Utility Index TSR of
41.9%;
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●
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Five-year (2012-2016) TSR
of
99.8% exceeded the Philadelphia Utility Index TSR of
56.6%;
and
|
●
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Annual dividend rate has grown
from $1.30 per share in 2012 to $2.17 per share in
2017.
|
Our Director
Nominees
Our director nominees reflect the diversity of ethnicity, gender, skills,
background and qualifications valued by our Board. The range of tenure on our
Board brings a variety of perspectives to strategic, financial and operational
deliberations.
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Name
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Director
Since
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Industry
Experience
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Ethnicity/
Gender
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Independent
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Committee
Memberships
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Other
Public
Co.
Boards
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Mandatory
Retirement
Date
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Vanessa C.L.
Chang
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2007
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Accounting/
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Asian/
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Yes
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Audit
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3
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2025
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Real Estate
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Female
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Compensation
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Louis Hernandez, Jr.
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2016
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Multimedia/
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Hispanic/
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Yes
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Audit
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1
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2038
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Technology
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Male
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FOSO
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James T. Morris
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2016
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Insurance
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White/
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Yes
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Audit
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1
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2032
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Male
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Compensation
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Kevin M. Payne
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2016
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Electric Utilities
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White/
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No
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None
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0
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N/A
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(SCE Nominee Only)
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Male
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Pedro J. Pizarro
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2014
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Electric
Utilities
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Hispanic/
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No
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None
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0
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N/A
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Male
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Linda G. Stuntz
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2014
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Law
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White/
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Yes
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FOSO
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1
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2027
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Female
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Governance
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William P.
Sullivan
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2015
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Information
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White/
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Yes
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FOSO
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1
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2022
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(EIX Chair)
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Technology/
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Male
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Governance
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Biotechnology
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Ellen O. Tauscher
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2013
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Government/
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White/
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Yes
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Audit
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2
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2024
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Finance
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Female
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FOSO
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Peter J. Taylor
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2011
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Finance
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African
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Yes
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Audit
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0
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2031
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American/
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Compensation
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Male
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Brett White
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2007
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Commercial
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White/
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Yes
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Compensation
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0
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2032
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Real Estate
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Male
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Governance
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Audit = Audit Committee
Compensation = Compensation and Executive Personnel Committee
FOSO =
Finance, Operations and Safety Oversight Committee
Governance =
Nominating/Corporate Governance Committee
2017 Proxy
Statement
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|
1
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Table of
Contents
Our
Corporate Governance Attributes
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Board Characteristics
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Average Age of EIX Director Nominees
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59
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Average Tenure of EIX
Director Nominees (Number of Years)
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4
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Percentage of EIX Director
Nominees Who Are Independent
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89%
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Percentage of EIX Director
Nominees Who Are Female
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33%
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Percentage of EIX Director Nominees From Diverse Ethnic
Backgrounds
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44%
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Board
Oversight
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Independent Chair of the EIX Board
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✓
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Independent Directors Meet Regularly Without
Management Present
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✓
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Key Board Committees Composed Solely of
Independent Directors
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✓
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Board Oversight of Key Enterprise Risks,
Including Cybersecurity
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✓
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Board Oversight of Political
Contributions
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✓
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Annual Board and Committee Evaluations
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✓
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Executive
Compensation
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Majority of Executive
Compensation At Risk and Aligned with Shareholder Interests
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✓
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Quantitative Targets for
Most Annual Incentive Plan Goals
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✓
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Incentive Compensation
Clawback Policy
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✓
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Anti-Hedging and
Anti-Pledging Policies
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✓
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Stock Ownership Guidelines
for Directors and Executive Officers
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✓
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Stock Holding Requirements for Executive
Officers
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✓
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Shareholder
Rights
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Annual Election of Directors
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✓
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Majority Voting for Directors in Uncontested
Elections
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✓
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Threshold for Shareholders to Call Special
Meetings
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10%
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Shareholder Ability to Act By Written
Consent
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✓
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Annual Advisory Vote on Executive
Compensation
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✓
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Proxy Access for Director Elections
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✓
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2016
Meetings
|
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Number of Board
Meetings
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11
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Number of Independent
Director Executive Sessions
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6
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Percentage of EIX Director
Nominees Who Attended >75% of Board and Committee Meetings
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100%
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|
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Percentage of EIX Director
Nominees Who Attended the Annual Meeting
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89%
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|
|
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|
Percentage of EIX Shareholder Votes Cast in Favor of
Executive Compensation
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|
96%
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|
Our
Leadership Transition
Theodore F.
Craver, Jr. retired at age 65 from his position as EIX Chairman and Chief
Executive Officer (CEO), effective September 30, 2016. In anticipation of Mr.
Cravers retirement, the Board established a special committee on Board
leadership and regularly discussed succession planning at Board
meetings.
During the succession planning process, the EIX Board determined that
separating the roles of the chair and CEO upon Mr. Cravers retirement would be
in the best interests of our shareholders.
Effective upon
Mr. Cravers retirement, the Board appointed independent director William P.
Sullivan as the non-executive Chair of the EIX Board and elected Pedro J.
Pizarro to succeed Mr. Craver as EIX CEO. To facilitate this leadership
transition, effective June 1, 2016, the Board elected Mr. Pizarro as EIX
President and Kevin M. Payne as SCE CEO, succeeding Mr. Pizarro.
Our
Shareholder Engagement
We seek and
value input from our shareholders. In 2016, we engaged with our major
institutional shareholders to discuss the Companys corporate governance,
executive compensation, and business strategy. In particular, we sought feedback
from shareholders regarding our proxy access framework and sustainability
disclosure. Management shared the feedback received from these discussions with
the Board and relevant Board committees.
2
|
|
2017 Proxy
Statement
|
Table of
Contents
ITEM 1: ELECTION OF
DIRECTORS
Nine directors have been nominated for election to the EIX Board and ten
directors have been nominated for election to the SCE Board, each to hold office
until the next Annual Meeting. The director nominees of EIX and SCE are the
same, except that Mr. Payne is a nominee for the SCE Board only. Directors
Jagjeet S. Bindra, who decided not to stand for re-election, and Richard T.
Schlosberg III, who reached the mandatory retirement age of 72, will leave the
Board effective as of the date of the Annual Meeting.
A biography of each nominee describing his or her age as of this Proxy
Statement, current Board committee service, business experience during the past
five years and other relevant business experience is presented below. The
biography includes the experience, qualifications, attributes, and skills that
led the Board to conclude that the nominee should serve as a director. While
each nominees entire range of experience and skills is important, particular
experience that contributes to the diversity and effectiveness of the Board is
identified below.
|
Vanessa C.L.
Chang
|
|
|
|
|
|
|
|
Biographical Information
Ms. Chang has been a director of EL & EL
Investments, a private real estate investment business, since 1999. She
previously served as chief executive officer and president of
ResolveItNow.com, an online dispute resolution service, senior vice
president of Secured Capital Corporation, a real estate investment bank,
and a partner of the accounting firm KPMG Peat Marwick LLP. Ms. Chang is a
director of Sykes Enterprises, Incorporated and Transocean Ltd., and a
director or trustee of 17 funds advised by the Capital Group and its
subsidiaries, of which seven are members of the American Funds family and
ten are members of Capital Groups Private Client Services. She is a
graduate of the University of British Columbia and a Certified Public
Accountant (inactive).
Specific Qualifications and Experience Relevant to
the Company
Ms. Chang brings to the Board
experience in accounting and financial reporting and oversight matters.
This experience is valuable in her role as a financial expert on the Audit
Committee. Ms. Chang spent most of her career in the Southern California
area and brings knowledge of the community served by SCE. She also brings
experience as a director of public, private, and non-profit organizations,
and securities regulation and corporate governance
knowledge.
|
|
|
Age
64
Director Since
2007
Board Committees
●
Audit
●
Compensation
Other Public
Company Boards
●
American Funds
Family
●
Sykes
Enterprises,
Incorporated
●
Transocean
Ltd.
|
|
|
|
|
|
Louis Hernandez,
Jr.
|
|
|
|
|
|
|
|
|
Age
50
Director Since
2016
Board Committees
●
Audit
●
FOSO
Other Public
Company Boards
●
Avid Technology,
Inc.
|
Biographical Information
Mr. Hernandez has been the chairman and chief executive
officer of Avid Technology, Inc., a digital media company that provides
audio and video technology, since 2013, and also served as its president
from 2013 to 2016. He has been a director of Avid Technology, Inc. since
2008. From 1999 to 2013, Mr. Hernandez served as chairman and chief
executive officer of Open Solutions, Inc., a technology provider for the
financial services marketplace. He previously also served in various
executive roles at RoweCom Inc. and U.S. Medical Instruments, Inc. and as
a director of HSBC North America Holdings Inc. and several of its
affiliates. Mr. Hernandez is a graduate of San Diego State University,
where he also received his MBA degree.
Specific Qualifications and Experience Relevant to
the Company
Mr. Hernandez brings to the Board
public company chief executive leadership experience in the multimedia
software industry and technology sector. He also brings entrepreneurial,
marketing, and product development experience, which is particularly
relevant to the Companys new business development activities. Mr.
Hernandezs experience in the technology sector is valuable in addressing
the challenges of the changing electric industry.
|
|
|
|
|
|
|
|
2017 Proxy
Statement
|
|
3
|
Table of
Contents
ITEM 1: ELECTION OF
DIRECTORS
|
James T.
Morris
|
|
|
|
|
|
|
|
|
Age
57
Director Since
2016
Board Committees
●
Audit
●
Compensation
Other Public
Company Boards
●
Pacific Mutual Fund
Complex
|
Biographical Information
Mr. Morris is the chairman, president and chief
executive officer of Pacific Life Insurance Company, and its parent
companies Pacific Mutual Holding Company and Pacific LifeCorp. He has
served as chief executive officer since 2007 and chairman since 2008, and
served as president from 2007 to 2012 and again beginning in 2016. Mr.
Morris has served in a variety of management positions since joining
Pacific Life in 1982, including chief operating officer from 2006 to 2007,
executive vice president and chief insurance officer, life insurance and
annuities and mutual funds divisions, from 2005 to 2006, executive vice
president, life insurance division, from 2002 to 2005, and senior vice
president, individual insurance, from 1996 to 2002. In addition, he has
been chairman of the board and trustee of the Pacific Select Fund and the
Pacific Funds Series Trust, members of the same mutual fund complex, since
2007. Mr. Morris serves as a director of the American Council of Life
Insurers, where he previously served as its chairman from 2012 to 2013. He
is a graduate of the University of California at Los Angeles and serves as
a member of the Board of Visitors of the UCLA Anderson School of
Management.
Specific Qualifications and Experience Relevant to
the Company
Mr. Morris brings to the Board
business and chief executive leadership experience in an industry which,
like the electric utility industry, is highly regulated. He also brings
strategic perspective, product development, marketing and financial
analysis experience to the Board.
|
|
|
|
|
|
|
|
|
Kevin M.
Payne
|
|
|
|
|
|
|
|
|
Age
56
SCE Director Since
2016
Other Public
Company Boards
●
None
|
Biographical
Information
Mr. Payne has been the CEO of SCE since June 2016. Prior
to his current role, he served as senior vice president of Customer
Service for SCE from 2014 to June 2016. Mr. Payne has held various
leadership positions, including Vice President of Engineering and
Technical Services from 2011 to 2014, Vice President of Client Services
Planning and Controls from 2010 to 2011, Vice President of Information
Technology and Business Integration from 2009 to 2010, and Vice President
of Enterprise Resource Planning from 2008 to 2009. Prior to that he was a
Director in the Renewable and Alternative Power and Major Customer
Technical Support departments. Mr. Payne began his career with SCE in 1986
in the Engineering and Construction department managing power plant
retrofit and other engineering projects. He has a degree in mechanical
engineering from the University of California, Berkeley, and is a
registered professional engineer.
Specific Qualifications and Experience Relevant to
the Company
Mr. Payne brings to the SCE Board
in-depth knowledge of the Companys business, experienced leadership, and
an engineering background. He also brings senior executive, operations and
strategic planning experience developed during his 30 years of service
with SCE.
|
|
|
|
|
|
|
|
4
|
|
2017 Proxy
Statement
|
Table of Contents
ITEM 1: ELECTION OF DIRECTORS
|
Pedro J. Pizarro
|
|
|
|
|
|
|
Age
51
EIX Director
Since
2016
SCE Director Since
2014
Other Public
Company Boards
●
None
|
Biographical Information
Mr. Pizarro has been the President and CEO of EIX since
October 2016. Prior to that, he served as President of EIX from June 2016
to September 2016 and President of SCE from October 2014 to May 2016. Mr.
Pizarro has held a wide range of executive positions at the EIX companies
since joining EIX in 1999. From 2011 through March 2014, he served as
President of EME, an indirect subsidiary of EIX that filed for bankruptcy
in 2012. Prior to that, Mr. Pizarro served as Executive Vice President of
SCE from 2008 to 2011, responsible for SCEs transmission and distribution
system, procurement of conventional and renewable power, and gas-fired and
hydroelectric power production facilities. He also previously served as
Vice President and Senior Vice President of Power Procurement, and Vice
President of Strategy and Business Development, among other executive
roles. Prior to his work at the EIX companies, Mr. Pizarro was a senior
engagement manager with McKinsey & Company, providing management
consulting services to energy, technology, engineering services, and
banking clients. He is a director of the Edison Electric Institute and the
Electric Power Research Institute, and is a member of the Board of
Governors of Argonne National Laboratory. Mr. Pizarro is a graduate of
Harvard University and earned a Ph.D. in chemistry from the California
Institute of Technology.
Specific Qualifications and Experience Relevant to
the Company
Mr. Pizarro brings to the Board
in-depth knowledge of the Companys business, experienced leadership, and
operations and strategic planning experience and background. His
leadership and experience dealing with difficult challenges during the EME
bankruptcy adds value to the Board. He also brings experience as a
director of various non-profit organizations.
|
|
|
|
|
|
|
|
Linda G. Stuntz
|
|
|
|
|
|
|
Age
62
Director
Since
2014
Board
Committees
●
FOSO
●
Governance
Other Public
Company Boards
●
Royal Dutch Shell
plc
|
Biographical Information
Ms. Stuntz has been a partner of the law firm of Stuntz,
Davis & Staffier, P.C. since 1995, and served as a partner of the law
firm of Van Ness Feldman LLP from 1993 to 1995. Her practice includes
energy and environmental regulation. Ms. Stuntz previously served as
Deputy Secretary of, and held senior policy positions in, the U.S.
Department of Energy from 1989 to 1993, and served as associate minority
counsel and minority counsel to the Energy and Commerce Committee of the
U.S. House of Representatives from 1981 to 1987. She is a director of
Royal Dutch Shell plc, and previously served as a director of Raytheon
Company, Schlumberger, Ltd. and American Electric Power Company. Ms.
Stuntz also served on the U.S. Secretary of Energy Advisory Board. She is
a graduate of Wittenberg University and received her law degree from
Harvard University.
Specific Qualifications and Experience Relevant to
the Company
Ms. Stuntz brings to the Board
utility and environmental law and public policy experience, which is
particularly relevant to the Companys business. Her experience as a
director of other public companies, including in the energy and electric
utilities industries, also brings value to the Board.
|
|
|
|
|
|
|
2017 Proxy
Statement
|
|
5
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Table of Contents
ITEM 1: ELECTION OF DIRECTORS
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William P. Sullivan
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Age
67
Director
Since
2015
Chair of the EIX Board
Board
Committees
●
FOSO
●
Governance
Other Public
Company Boards
●
Maxim
Integrated
|
Biographical Information
Mr. Sullivan served as chief executive officer of
Agilent Technologies, a global provider of scientific instruments,
software, services and consumables in life sciences, diagnostics and
applied chemical markets, from 2005 to 2015. In addition, he was Agilents
president from 2005 to 2012 and 2013 to 2014. Prior to that, Mr. Sullivan
was executive vice president and chief operating officer of Agilent from
2002 to 2005. He had been senior vice president and general manager of
Agilents Semiconductor Products Group from 1999 to 2002. Before 1999, Mr.
Sullivan served in various management roles, including in manufacturing
and product development, at Hewlett-Packard Company. He serves as a
director of Maxim Integrated and previously served as a director of
Agilent Technologies, Avnet, Inc. and URS Corporation. Mr. Sullivan is a
graduate of the University of California, Davis.
Specific Qualifications and Experience Relevant to
the Company
Mr. Sullivan brings to the Board
experience as president and chief executive officer of a large public
company. He also brings significant operational experience, including
leadership of successful company transformation. This experience,
particularly in the technology sector and in product and business
development, is very valuable to the Board in the changing electric
industry.
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Ellen O. Tauscher
|
|
|
|
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Age
65
Director
Since
2013
Board
Committees
●
Audit
●
FOSO
Other Public
Company Boards
●
eHealth Inc.
●
SeaWorld Entertainment,
Inc.
|
Biographical Information
Ms. Tauscher has been a strategic advisor with the law
firm of Baker, Donelson, Bearman, Caldwell & Berkowitz, PC since 2012.
Ms. Tauscher served as Under Secretary of State for Arms Control and
International Security from 2009 to 2012. Prior to joining the State
Department, she served from 1997 to 2009 as a member of the U.S. House of
Representatives from Californias 10th Congressional District. While a
member of Congress, Ms. Tauscher served on the House Armed Services
Committee, the House Transportation and Infrastructure Committee and as
Chairman of the House Armed Services Subcommittee on Strategic Forces.
Prior to serving in Congress, she worked in investment banking and the
financial industry in various roles for Bache Halsey Stuart Shields, Bear
Stearns & Co., and Drexel Burnham Lambert, and as an officer of the
American Stock Exchange. Ms. Tauscher is a director of eHealth, Inc. and
SeaWorld Entertainment, Inc., and previously served as a director of
Invacare Corporation. She also served on the U.S. Secretary of Energy
Advisory Board. Ms. Tauscher is a graduate of Seton Hall
University.
Specific Qualifications and Experience Relevant to
the Company
Ms. Tauscher brings to the Board
extensive government affairs and public policy experience, which is
particularly relevant to the Companys business and valuable in assessing
the Companys strategy. She also brings business and financial acumen. Her
experience in national security and in the State Department and in
Congress is particularly valuable in the oversight of cybersecurity risk
and her role as the Boards liaison to the Companys cybersecurity
oversight group (see page 10).
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6
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2017 Proxy
Statement
|
Table of Contents
ITEM 1: ELECTION OF DIRECTORS
|
Peter J. Taylor
|
|
|
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|
|
|
Age
58
Director
Since
2011
Board
Committees
●
Audit
(Chair)
●
Compensation
Other Public
Company Boards
●
None
|
Biographical Information
Mr. Taylor has been the president of ECMC Foundation, a
nonprofit corporation dedicated to educational attainment for low-income
students, since May 2014. Prior to that he served as executive vice
president and chief financial officer of the University of California from
2009 to 2014 and managing director of public finance at Lehman Brothers
and Barclays Capital from 2002 to 2009. Mr. Taylor is a director of
Pacific Mutual Holding Company and the Kaiser Family Foundation, and a
member of the Board of Trustees of California State University and the J.
Paul Getty Trust. Previously, he was chair of the UCLA African American
Admissions Task Force and a commissioner on the California Performance
Review Commission. Mr. Taylor is a graduate of the University of
California Los Angeles and holds a Masters degree in public policy
analysis from Claremont Graduate University.
Specific Qualifications and Experience Relevant to
the Company
Mr. Taylor brings to the Board
finance and public policy experience, which is particularly relevant to
the Companys infrastructure investment strategy and highly regulated
business. He also brings experience in risk management, accounting and
financial reporting, which is valuable in his role as a financial expert
and Chair of the Audit Committee.
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Brett White
|
|
|
|
|
|
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Age
57
Director
Since
2007
Board
Committees
●
Compensation
(Chair)
●
Governance
Other Public
Company Boards
●
None
|
Biographical Information
Mr. White has been chairman and chief executive officer
of Cushman & Wakefield (formerly DTZ), a commercial real estate
services company, since September 2015. He served as executive chairman of
DTZ from March 2015 to September 2015. Mr. White previously served as a
senior advisor to TPG Capital, a private equity firm, from July 2014 to
December 2014 and as a managing partner at Blum Capital, a private equity
firm, from January 2013 to December 2013. Prior to that, he served as
chief executive officer of CBRE Group, Inc., a commercial real estate
services firm, from 2005 to 2012, president of CBRE Group from 2001 to
2010 and, prior to that, as chairman of the Americas of CB Richard Ellis
Services, Inc. Mr. White previously served as a director of Ares
Commercial Real Estate Corporation, CBRE Group, Inc. and Realogy Holdings
Corporation. He is a graduate of the University of California, Santa
Barbara.
Specific Qualifications and Experience Relevant to
the Company
Mr. White brings to the Board the
experience, strategic perspective, critical judgment and analytical skills
of a chief executive officer of a global company. His real estate services
industry experience is particularly relevant to the Companys
infrastructure investment strategy. He also brings the perspective of a
business headquartered and doing business in the local markets served by
SCE developed from his years of service at CBRE Group. This experience is
valuable in Mr. Whites role as the Companys Compensation Committee
Chair.
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The Board recommends you
vote FOR the EIX and SCE director nominees, as
applicable.
|
2017 Proxy
Statement
|
|
7
|
Table of Contents
ITEM 1: ELECTION OF DIRECTORS
How are potential director nominees
identified and selected by the Board to become nominees?
The Governance Committee, comprised solely
of independent directors under New York Stock Exchange LLC (NYSE) rules and
our Corporate Governance Guidelines, recommends director candidates to the
Board.
The Committee will consider candidates
recommended by shareholders if they are submitted in writing to the Corporate
Secretary and include all of the information required by Article II, Section 4
of our Bylaws plus a written description with any supporting materials
of:
●
|
Any direct or indirect
business relationships or transactions within the last three years between
EIX and its subsidiaries and senior management, on the one hand, and the
candidate and his or her affiliates and immediate family members, on the
other hand; and
|
●
|
The qualifications,
qualities, and skills of the candidate that the shareholder deems
appropriate to submit to the Committee to assist in its consideration of
the candidate.
|
The Committee also considers candidates
recommended by our directors, senior management, and director search firms
retained by the Committee. Mr. Hernandez, who was elected to the Board in August
2016 and is a first-time nominee for election by the shareholders at the Annual
Meeting, was recommended by the Committees director search firm. The search
firm supports the process of identifying director candidates, coordinating the
interview process and conducting reference checks. There are no differences in
the manner in which the Committee evaluates a candidate based on the source of
the recommendation.
If, based on an evaluation of the
candidates qualifications, qualities and skills, the Committee determines to
continue its consideration of a candidate, Committee members and other directors
as determined by the Committee interview the candidate. The Committee conducts
any further research on the candidate it deems appropriate. The Committee then
determines whether to recommend that the candidate be nominated as a director.
The Board considers the recommendation and determines whether to nominate the
candidate for election.
What information does the Governance
Committee consider when recommending a director nominee?
For the Committee to recommend a director
nominee, the candidate must at a minimum possess the qualifications, qualities
and skills in our Corporate Governance Guidelines, including:
●
|
A reputation for integrity,
honesty and adherence to high ethical standards;
|
●
|
Experience in a generally
recognized position of leadership; and
|
●
|
The demonstrated business acumen,
experience and ability to exercise sound judgment in matters that relate
to the current and long-term objectives of the
Company.
|
The Committee also considers other factors
and information, including the Boards current need for additional members, the
candidates potential for increasing the Boards range of experience, skills and
diversity, the candidates independence, and skills and experience relevant to
our business strategy.
In nominating candidates for re-election
to the Board, the Committee also considers the nature and time invested in a
directors service on other boards, the directors Board, Board committee and
annual meeting attendance, and the vote received at the prior annual
meeting.
How does the Governance Committee
consider diversity in identifying director candidates?
Our Corporate Governance Guidelines state
the Boards policy that the value of diversity on the Board should be
considered. The Committee considers ethnic and gender diversity, and diversity
of skills, backgrounds and qualifications represented on the Board, in
recommending nominees for election. The Committee has instructed its director
search firm to identify candidates reflecting ethnic and gender
diversity.
The Committee evaluates its effectiveness
in achieving diversity on the Board through its annual review of Board
composition, which identifies ethnicity, gender and industry experience prior to
recommending nominees for election.
How does the Board determine which
directors are independent?
Our Corporate Governance Guidelines
require that the Board be comprised of at least a majority of independent
directors and that the Audit, Compensation, and Governance Committees be
comprised entirely of independent directors. The Company uses the NYSE listing
standards to determine independence.
Directors serving on the Audit and the
Compensation Committees must meet additional independence criteria prescribed by
the NYSE listing standards and the charters of those Committees. Director Chang
serves on the audit committees of the American Funds family, Sykes Enterprises,
Incorporated and Transocean Ltd. The Board has determined Ms. Changs
simultaneous service on the audit committees of three other public companies
does not impair her ability to effectively serve on our Audit
Committee.
The Board has determined that the
relationships described in Section B of Exhibit A-1 to our Corporate Governance
Guidelines, which are on our website at
www.edison.com/corpgov
, are not
material for purposes of determining directors independence to serve on the
Board. The Board does not consider these relationships in making independence
determinations to serve on the Board.
For relationships not prohibited by NYSE
rules and not covered under the categories of immaterial relationships in our
Guidelines, the determination of whether a relationship is material or not, and
therefore whether a director is independent to serve on the Board or not, is
made in good faith by the directors. The director whose relationship is under
consideration abstains from the vote regarding his or her
independence.
8
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2017 Proxy
Statement
|
Table of Contents
ITEM 1: ELECTION OF DIRECTORS
Which directors has the Board
determined are independent to serve on the Board?
The Board has determined that all
directors other than Messrs. Pizarro and Payne are independent to serve on the
Board.
The Board reviews the independence of our directors to serve on the Board
or an independent Board committee at least annually, and periodically as needed.
On a monthly basis, the Company also monitors director relationships and
transactions that might disqualify them as independent. In February 2017, prior
to recommending director nominees for election, the Board confirmed that the
independent directors had no relationships or transactions that disqualified
them as independent to serve on the Board.
Who is the Chair of the Board and what
are the Chairs duties and responsibilities?
Mr. Sullivan has served as the independent
Chair of the EIX Board since September 30, 2016. Prior to this time, Mr. Craver
served as EIX Chairman and CEO and Mr. White served as the Companys Lead
Director. Effective upon Mr. Cravers retirement on September 30, 2016, the EIX
Board separated the roles of Chair and CEO by amending the EIX Bylaws and
Corporate Governance Guidelines and appointing Mr. Sullivan as independent Chair
of the EIX Board and Mr. Pizarro as EIX CEO. The Company no longer has a Lead
Director.
As independent Chair, Mr. Sullivans
duties include:
●
|
Chair the Board
meetings and Annual Meetings;
|
●
|
With the CEO, create
the agenda for the Board meetings;
|
●
|
With the Governance
Committee, oversee the annual evaluations of the
Board;
|
●
|
Be the principal
liaison in synthesizing and communicating to the CEO key issues from the
executive sessions of the independent directors;
and
|
●
|
With the Compensation
Committee Chair, conduct the annual CEO performance review after review
with the independent directors.
|
The SCE Bylaws provide that the CEO of SCE
has the duties of the Chair unless a separate Chair of the SCE Board is
appointed. Since June 1, 2016, Mr. Payne has served as SCE CEO and has had the
duties of the Chair of the SCE Board. SCE does not have a Lead
Director.
Why does the Board believe its Board
leadership structure is appropriate?
The EIX Board believes separating the
Chair and CEO positions is the most appropriate leadership structure for EIX at
this time, by allowing Mr. Pizarro to focus on the day-to-day management of the
business and on executing our strategic priorities, while allowing Mr. Sullivan
to focus on leading the Board, providing advice and counsel to Mr. Pizarro, and
facilitating the Boards independent oversight of management.
The SCE Board has determined that the
current leadership structure is appropriate for SCE as a subsidiary of EIX. All
directors of SCE are independent, except for Messrs. Payne and Pizarro, and the
key Board committees are composed entirely of independent directors.
What is the Boards role in CEO
succession planning?
The Board believes CEO succession planning
is one of its most important responsibilities. Our Corporate Governance
Guidelines provide that the Board will annually review and evaluate succession
planning and management development for the Companys senior officers, including
the CEO.
At least annually, the Board meets in
executive session with the EIX CEO to discuss talent and succession planning.
The discussion includes CEO succession in the ordinary course, CEO succession if
an emergency occurs, and succession for other key senior management positions.
The frequency of the Boards CEO succession planning discussions depends in part
on the period until the CEOs expected retirement.
In the succession planning process,
internal CEO succession candidates are identified and evaluated based on
criteria considered predictive of success at the CEO level, considering the
Companys business strategy. The Board uses a common talent assessment format
for each individual. The assessment includes a development plan for each
individual.
Our Corporate Governance Guidelines
provide that the Board will have opportunities to become acquainted with the
senior officers of the Company and others who may have the potential to handle
significant management positions. This is carried out through opportunities for
officers to make presentations to the Board and Board committees, director
education sessions, other business interactions, and social events intended for
this purpose.
What is the Boards role in risk
oversight?
Our Corporate Governance Guidelines
provide that one of the Boards primary functions is to review the Companys
enterprise risk management process and monitor strategic and emerging risks. The
Board reviews key enterprise risks identified by management, such as financial,
reputational, safety, physical and cyber security, and compliance risks, and
monitors key risks through reports and discussions regarding key risk areas at
Board meetings. The Board also focuses on specific strategic and emerging risks
in periodic strategy reviews. The Board annually reviews corporate goals and
approves capital budgets. Board committees have responsibility for risk
oversight in specific areas as follows:
The Audit Committee is responsible for
oversight of (i) risk assessment and risk management policies, (ii) major
financial risk exposures, and (iii) the steps management has taken to monitor
and control these exposures. The Committee reviews the Companys risk management
processes and key enterprise risks, reviews the EIX risk management committee
charter, receives regular reports on litigation, internal audits and compliance,
receives deep dive reports on specific risk topics at meetings, and receives
semi-annual reports of the Companys political contributions. The Committee also
annually reviews and approves the internal audit plan. The EIX Vice President of
Enterprise Risk Management regularly attends Committee meetings and reports on
risk issues.
2017 Proxy
Statement
|
|
9
|
Table of Contents
ITEM 1: ELECTION OF DIRECTORS
The Compensation Committee assesses and
monitors risks in the Companys compensation program. The Committees risk
assessment process and factors considered in assessing risk are discussed under
How We Make Compensation
Decisions -
Risk
Considerations
in the Compensation
Discussion and Analysis below.
The FOSO Committee is responsible for
oversight of risks in the Companys capital investment activities and
operations. The Committee regularly monitors the level of capital spending
relative to approved capital budgets and must approve significant capital
spending variances and projects not included in approved capital budgets. The
Committee also monitors safety and operational performance metrics, significant
developments related to safety, physical and cyber security, reliability and
affordability, and the availability of resources in these areas. The Committee
receives deep dive reports on key topics related to its responsibilities.
The Governance Committee advises the Board
regarding Board size and composition, Board committee composition and
responsibilities, selection of the independent Chair of the EIX Board, and
corporate governance practices that help position the Board to effectively carry
out its risk oversight responsibility.
The Board believes its leadership
structure supports the Boards risk oversight function. Independent directors
chair the Board committees responsible for risk oversight, the Company has an
independent Chair of the EIX Board who facilitates communication between
management and directors, and all directors are involved in the review of key
enterprise risks.
What is the Boards role in
cybersecurity oversight?
The Company has identified cybersecurity
as a key enterprise risk. Cyber risks are included in the key risk reports to
the Audit Committee discussed above. In addition, the Board has assigned primary
responsibility for cybersecurity oversight to the FOSO Committee, which receives
cybersecurity updates with each meeting that focus on the Companys most
critical assets, cybersecurity drills, exercises, mitigation of cyber risks, and
assessments by third-party experts. In 2016, the Board also received a report
with a similar focus on reducing the Companys cybersecurity risks.
The Company has established a
cybersecurity oversight group comprised of a multidisciplinary senior management
team to provide governance and strategic direction for the identification,
protection and detection of cybersecurity risks to the Company. Director
Tauscher serves as the Board liaison to the oversight group and regularly
attends meetings. Other Board members attend at least one meeting
annually.
What is the Boards role in oversight
of environmental and social issues?
Environmental and social policies have a
significant impact on the Companys business and strategy. As a result, the
Board is regularly engaged in oversight of environmental and social issues
related to the Companys operations, including:
●
|
Environmental legislation and
regulation related to renewable energy, distributed generation, energy
efficiency and climate change;
|
●
|
Strategic decisions and
opportunities related to public policy focus on
sustainability;
|
●
|
Employee and supplier diversity;
and
|
●
|
Employee, contractor and public
safety.
|
The Board oversees environmental and
social issues that impact the Companys business, regulatory requirements, and
reputation. Risks associated with environmental and social issues are identified
in key risk reports to the Audit Committee. The Audit Committee also oversees
the Companys political and charitable contributions.
How do the Board and Board committees
evaluate their performance?
The Board and Board committees complete an
annual self-evaluation questionnaire and discuss the results of their evaluation
in executive session during the applicable Board or committee meeting. Directors
have the opportunity to provide feedback on the performance of other directors
during this process. The Governance Committee oversees the annual evaluation of
the Board and Board committees and periodically reviews the effectiveness of the
process.
How many times did the Board meet in
2016?
The Board met eleven times in 2016. Each
director attended 75% or more of all Board and Board committee meetings he or
she was eligible to attend. The Board held six executive sessions of the
independent directors.
Does the Company have a policy on
attendance of Director nominees at Annual Meetings?
Director nominees are expected to attend
Annual Meetings. All of the EIX and SCE directors except Mr. Taylor attended the
2016 Annual Meeting.
Are directors required to hold EIX
Common Stock?
Within five years from their initial
election to the Board, directors must own an aggregate number of shares of EIX
Common Stock or derivative securities convertible into EIX Common Stock,
excluding stock options, having a value equivalent to five times the annual
Board retainer. All deferred stock units held by a director count toward this
ownership requirement. All directors comply with this stock ownership
requirement.
Has EIX adopted proxy access for
director elections?
In 2015, the EIX Board adopted proxy
access for director elections at annual meetings. The EIX Bylaws provide that
the Company will include in its Proxy Statement up to two nominees (or nominees
for up to 20% of the EIX Board, whichever is greater) submitted by a shareholder
or group of up to 20 shareholders owning at least 3% of EIX common stock
continuously for at least three years, if the shareholder group and nominee
satisfy the requirements in Article II, Section 13 of the EIX Bylaws, which are
available at
www.edison.com/corpgov
. The EIX Board
made this decision after careful consideration of feedback received from our
engagement with shareholders regarding proxy access.
10
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2017 Proxy
Statement
|
Table of Contents
ITEM 1: ELECTION OF DIRECTORS
Does EIX have a policy on shareholder
rights plans?
The EIX Board has a policy to seek prior
shareholder approval of the adoption of any shareholder rights plan unless, due
to time constraints or other reasons consistent with the EIX Boards fiduciary
duties, a committee consisting solely of independent directors determines that
it would be in the best interests of EIX shareholders to adopt the plan prior to
shareholder approval. Any rights plan adopted by the EIX Board without prior
shareholder approval will automatically terminate one year after adoption of the
plan unless the plan is approved by EIX shareholders prior to such
termination.
Is SCE subject to the same corporate
governance stock exchange rules as EIX?
EIX is subject to NYSE rules and SCE is
subject to NYSE MKT LLC rules, which exempt SCE from designated corporate
governance rules for Board and Board committee composition, including director
independence, the director nominations process, and the process to determine
executive compensation.
SCE is exempt from these rules because (i)
it is a controlled company with over 50% of the voting power held by its
parent company, EIX, and (ii) it has listed only preferred stock on the
exchange. However, SCE closely follows the EIX corporate governance practices
required under the NYSE rules.
How may I communicate with the
Board?
Shareholders and other interested parties
may communicate with the Board or individual directors by following the
procedures on our website at
www.edison.com/corpgov
.
Where can I find the Companys
corporate governance documents?
The EIX Bylaws, Corporate Governance
Guidelines, and Board committee charters, the Ethics and Compliance Code for
Directors applicable to all directors of EIX and SCE, and the Employee Code of
Conduct applicable to all EIX and SCE officers and employees, are on our website
at
www.edison.com/corpgov
.
The SCE Bylaws, Corporate Governance
Guidelines and Board committee charters are on our website at
www.sce.com/corpgov
.
Certain
Relationships and Related Transactions
|
The Governance Committee reviews at least
annually, and periodically as needed, any transaction in the prior calendar year
or any proposed transaction between the EIX companies and a related person in
which the amount involved exceeds $120,000 and the related person has a material
interest. A related person is a director, a director nominee, an executive
officer, or a greater than 5% beneficial owner of any class of voting securities
of EIX or SCE, and their immediate family members. This policy is stated in
writing in the Committees charter.
The Committees regular procedure is to
obtain from management annually, and periodically as needed, a list of the
transactions with related persons described above, and to review these
transactions at a meeting held before recommending director
nominations to the Board. The list is based on information
from questionnaires completed by our directors, director nominees, and executive
officers, together with information obtained from our accounts payable and
receivable records, and is reviewed by legal counsel. The Committees procedure
is evidenced in the minutes and records for the Committee meeting at which the
review occurred.
Director Linda Stuntz is an equity partner
at the law firm of Stuntz, Davis & Staffier, P.C. (SD&S), which paid
the Company approximately $201,777 in 2016 to sublease office space in
Washington, D.C. The Companys sublease of office space to SD&S began before
Ms. Stuntz joined the Board.
2017 Proxy
Statement
|
|
11
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Table of Contents
ITEM 1: ELECTION OF DIRECTORS
The current membership and key
responsibilities of our Audit, Compensation, Governance, and FOSO Committees are
below. The duties and powers of each Committee are further described in its
charter. The Board occasionally creates special Board committees to focus on
certain topics.
|
AUDIT
COMMITTEE
|
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Committee
Members:
Peter J.
Taylor, (Chair)
- Financial Expert
Vanessa C.L. Chang
- Financial Expert
Louis Hernandez, Jr.
- Financial Expert
James T. Morris
Ellen O. Tauscher
Meetings in
2016:
6
|
Key Responsibilities:
●
Appoint, compensate and oversee the Companys independent
registered public accounting firm (the Independent Auditor),
including:
-
the
qualifications, performance and independence of the Independent Auditor;
-
the scope and
plans for the annual audit; and
-
the scope and
extent of all audit and non-audit services to be performed by the
Independent Auditor.
●
Review the Companys
financial statements and financial reporting processes, including internal
controls over financing reporting.
●
Oversee the
Companys internal audit function, including the General Auditors
performance, the internal audit plan, budget, resources and
staffing.
●
Oversee the
Companys ethics and compliance program, including the Chief Ethics and
Compliance Officers performance, helpline calls and investigations, and
the employee code of conduct.
●
Discuss the
Companys policies and guidelines with respect to major financial and key
enterprise risk exposures, risk assessment and management, and the steps
taken to monitor and control these risks.
●
Establish and
maintain procedures for the receipt, retention and treatment of complaints
regarding accounting, internal accounting controls or auditing
matters.
●
Review the Companys
political contribution policies and expenditures and approve contributions
that exceed $1 million.
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COMPENSATION
AND EXECUTIVE PERSONNEL COMMITTEE
|
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|
Committee
Members:
Brett White
(Chair)
Vanessa C.L. Chang
James T. Morris
Richard T.
Schlosberg, III
Peter J. Taylor
Meetings in
2016:
3
|
Key Responsibilities:
●
Review the performance and set the compensation of designated
elected officers, including the executive
officers.
●
Review director
compensation for consideration and action by the
Board.
●
Approve the design
of executive compensation programs, plans and
arrangements.
●
Approve stock
ownership guidelines for officers and recommend director stock ownership
guidelines to the Board.
●
Review and assess
whether any risks arising from compensation policies and practices are
reasonably likely to have a material adverse effect on the
Company.
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12
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2017 Proxy
Statement
|
Table of Contents
ITEM 1: ELECTION OF
DIRECTORS
|
NOMINATING/CORPORATE GOVERNANCE COMMITTEE
|
|
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Committee
Members:
Richard T. Schlosberg, III
(Chair)
Jagjeet S. Bindra
Linda G. Stuntz
William P.
Sullivan
Brett White
Meetings in
2016:
6
|
Key Responsibilities:
●
Identify and recommend director
candidates.
●
Periodically review
Board size and composition.
●
Make recommendations
to the Board regarding Board committee and committee chair assignments and
the EIX independent Board Chair appointment.
●
Review related party
transactions.
●
Periodically review
and recommend updates to the Corporate Governance Guidelines and Board
committee charters.
●
Advise the Board
with respect to corporate governance matters.
●
Oversee the annual
evaluation of the Board and Board committees.
●
Review the
orientation program for new directors and continuing education activities
for all directors.
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FINANCE, OPERATIONS AND SAFETY OVERSIGHT
COMMITTEE
|
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Committee
Members:
Jagjeet S. Bindra (Chair)
Louis
Hernandez, Jr.
Linda G. Stuntz
William P. Sullivan
Ellen O.
Tauscher
Meetings in
2016:
4
|
Key Responsibilities:
●
Review and monitor capital spending and investments in subsidiaries
compared to the annual budget approved by the Board, and receive
post-completion reports from management on all major capital
projects.
●
Monitor operational
and service excellence performance metrics.
●
Monitor significant
developments relating to safety, reliability and affordability,
specifically including cybersecurity, business resiliency and emergency
response, and the availability of appropriate resources to achieve
objectives in these areas.
●
Annually review the
sources and uses of funds and the trust investments of the
Company.
●
Authorize financing,
redemption and repurchase transactions.
|
|
|
|
|
|
2017 Proxy
Statement
|
|
13
|
Table of Contents
ITEM 1: ELECTION OF
DIRECTORS
The following table presents information
regarding the compensation paid for 2016 to our non-employee directors. The
compensation paid to any director who is also an employee of EIX or SCE is
presented in the EIX and SCE Summary Compensation Tables and the related
explanatory tables.
Director Compensation
Table Fiscal Year 2016
Name
|
|
Fees
Earned or
Paid in
Cash
($)
|
|
Stock
Awards
(1)(2)
($)
|
|
Option
Awards
(3)
($)
|
|
Non-Equity
Incentive
Plan
Compensation
($)
|
|
Change in
Pension Value
and
Non-Qualified
Deferred
Compensation
Earnings
(4)
($)
|
|
All
Other
Compensation
(5)
($)
|
|
Total
($)
|
(a)
|
|
(b)
|
|
(c)
|
|
(d)
|
|
(e)
|
|
(f)
|
|
(g)
|
|
(h)
|
Jagjeet S. Bindra
|
|
$125,125
|
|
$135,032
|
|
|
|
|
|
|
|
$10,000
|
|
$270,157
|
Vanessa C.L. Chang
|
|
$124,000
|
|
$135,032
|
|
|
|
|
|
$24,331
|
|
$10,000
|
|
$293,363
|
Louis Hernandez, Jr.
|
|
$55,000
|
|
$67,537
|
|
|
|
|
|
$250
|
|
|
|
$122,787
|
James T. Morris
|
|
$82,500
|
|
$135,032
|
|
|
|
|
|
$718
|
|
|
|
$218,250
|
Richard T. Schlosberg, III
|
|
$123,125
|
|
$135,032
|
|
|
|
|
|
$43,993
|
|
$10,000
|
|
$312,150
|
Linda G. Stuntz
|
|
$110,000
|
|
$135,032
|
|
|
|
|
|
$2,152
|
|
$10,000
|
|
$257,184
|
William P. Sullivan
|
|
$127,625
|
|
$150,666
|
|
|
|
|
|
|
|
|
|
$278,291
|
Ellen O. Tauscher
|
|
$116,000
|
|
$135,032
|
|
|
|
|
|
$1,102
|
|
|
|
$252,133
|
Peter J. Taylor
|
|
$131,000
|
|
$135,032
|
|
|
|
|
|
|
|
$10,000
|
|
$276,032
|
Brett White
|
|
$144,375
|
|
$135,032
|
|
|
|
|
|
$22,606
|
|
$10,000
|
|
$312,013
|
(1)
|
The amounts
reported for stock awards reflect the aggregate grant date fair value of
those awards computed in accordance with FASB ASC Topic 718. For a
discussion of the assumptions and methodologies used to calculate the
amounts reported, see Note 8 (Compensation and Benefit Plans) to EIXs
Consolidated Financial Statements, included as part of EIXs 2016 Annual
Report.
|
(2)
|
Each non-employee
director, other than Mr. Hernandez, was granted a total of 1,926 shares of
EIX Common Stock or fully-vested deferred stock units on April 28, 2016,
and each share or unit had a value of $70.11 on the grant date. Mr.
Hernandez was granted 917 fully-vested deferred stock units on August 25,
2016 in connection with his initial election to the Board, and each unit
had a value of $73.65 on the grant date. Mr. Sullivan was granted an
additional 219 shares of EIX Common Stock on October 3, 2016 in connection
with his appointment as Chair of the EIX Board, and each share had a value
of $71.39 on the grant date. None of the non-employee directors had
unvested deferred stock units as of December 31, 2016.
|
(3)
|
We have not granted
stock options to our non-employee directors since 2009. The number of
outstanding EIX stock options from grants in prior years held by each
non-employee director as of December 31, 2016 was as follows: Ms. Chang
and Mr. White 7,500 each.The other non-employee directors do not have any
EIX stock options outstanding.
|
(4)
|
Amounts reported
consist of interest on deferred compensation account balances considered
under SEC rules to be at above-market rates.
|
(5)
|
EIX has a matching
gift program that provides assistance to qualified public and private
schools by matching dollar-for-dollar gifts of at least $25 up to a
prescribed maximum amount per calendar year for the Companys employees
and EIX and SCE directors. The amounts in this column reflect matching
gifts made by EIX pursuant to this program in 2016. EIX matches aggregate
director contributions of up to $10,000 per calendar year to qualified
schools. Under the Director Matching Gift Program, matching amounts for
non-cash gifts are determined based on the value of the gift on the date
given by the director. For purposes of determining the date on which a
gift of publicly-traded stock is given, the date is based on the date
stock ownership transfers to the qualified
school.
|
14
|
|
2017 Proxy
Statement
|
Table of Contents
ITEM 1: ELECTION OF
DIRECTORS
Annual Retainer and
Meeting Fees
Compensation for non-employee directors
during 2016 included an annual retainer, fees for attending certain meetings,
and an annual equity award. Directors were offered the opportunity to receive
all of their compensation on a deferred basis under the EIX Director Deferred
Compensation Plan. The following table sets forth the cash retainers and meeting
fees paid to directors in 2016:
Type of
Fee
|
|
Jan. to
Sept.
2016
|
|
Oct. to
Dec.
2016
|
Board Retainer Per Quarter
|
|
$27,500
|
|
$27,500
|
Additional Board Retainer
Per Quarter to:
|
|
|
|
|
●
|
Audit Committee
Chair
|
|
$5,000
|
|
$5,000
|
●
|
Compensation Committee Chair
|
|
$3,750
|
|
$4,375
|
●
|
Other Committee
Chairs
|
|
$3,125
|
|
$3,750
|
●
|
Lead Director
|
|
$6,250
|
|
N/A
|
●
|
Chair of the EIX Board
|
|
N/A
|
|
$15,625
|
Fee Per
Meeting:
(1)
|
|
|
|
|
●
|
Shareholder/Board/Committee
|
|
N/A
|
|
N/A
|
●
|
Other Business Meeting
|
|
$2,000
|
|
$2,000
|
(1)
|
Directors are not
paid meeting fees for attending shareholder, Board or Board committee
meetings. They are paid a $2,000 fee for attending any other business
meeting on behalf of the Company as a director, for example, cybersecurity
oversight group meetings (see page 10). No director received more than
$6,000 in meeting fees in 2016. Directors only receive one meeting fee for
any concurrent meetings attended by the
director.
|
All directors are also reimbursed for
out-of-pocket expenses for serving as directors and are eligible to participate
in the Director Matching Gift Program described in footnote (5) to the Director
Compensation Table above.
Annual Equity
Awards
Upon initial election or re-election to
the Board, non-employee directors are granted an annual equity award of EIX
Common Stock or deferred stock units (as explained below) with an aggregate
grant date value of $135,000. Upon initial appointment or re-appointment of a
non-employee director as Chair of the EIX Board, the director is granted an
additional annual equity award of EIX Common Stock or deferred stock units with
an aggregate grant date value of $62,500. If the grant date of an award for an
initial election to the Board or initial appointment as Chair of the EIX Board
occurs after the date of EIXs Annual Meeting for that year, then the grant date
value of the award is prorated by multiplying it by the following percentage:
75% if the grant date is in the second quarter of the year; 50% if the grant
date is in the third quarter of the year; 25% if the grant date is in the fourth
quarter of the year.
The number of shares or units granted is
determined by dividing the grant date value of the equity award ($135,000,
$62,500, or a prorated portion thereof, as described above) by the closing price
of EIX Common Stock on the grant date and rounding up to the next whole share.
Each award is fully vested when granted.
The annual equity award for an initial
election to the Board is made in the form of deferred stock units. For
re-election awards and the additional equity award for appointment or
re-appointment as Chair of the EIX Board, directors have the opportunity to
elect in advance to receive such awards entirely
in EIX Common Stock, entirely in deferred stock units, or in any
combination of the two. A deferred stock unit is a contractual right to receive
one share of EIX Common Stock. Deferred stock units are credited to the
directors account under the EIX Director Deferred Compensation Plan described
below. Deferred stock units cannot be voted or sold. They accrue dividend
equivalents on the ex-dividend date, if and when dividends are declared on EIX
Common Stock. The accrued dividend equivalents are converted to additional
deferred stock units.
Each directors equity award in 2016 was
granted under the EIX 2007 Performance Incentive Plan. Directors serving on both
Company Boards receive only one award per year for election to the Boards. In
April 2016, EIX shareholders approved amendments to the EIX 2007 Performance
Incentive Plan, including a limit of $500,000 per calendar year on the grant
date fair value of awards to each non-employee director. In 2016, each
non-employee director received equity awards totaling less than $200,000 in
grant date fair value.
EIX Director Deferred
Compensation Plan
The EIX Director Deferred Compensation
Plan is separated into two plan documents. The grandfathered plan document
applies to deferrals earned prior to January 1, 2005, while the 2008 plan
document applies to deferrals earned on or after January 1, 2005.
Non-employee directors are eligible to
defer up to 100% of their retainers and meeting fees. Any portion of a
directors annual equity award that he or she elects to receive as deferred
stock units is automatically deferred. Amounts deferred (other than deferred
stock units) accrue interest until paid to the director at a rate equal to the
average monthly Moodys Corporate Bond Yield for Baa Public Utility Bonds over a
60-month period ending September 1 of the prior year.
Payment of
Grandfathered Plan Benefits
Amounts deferred under the grandfathered
plan document (other than deferred stock units) may be deferred until a
specified date, retirement, death or discontinuance of service as a director. At
the directors election, any such compensation deferred until retirement or
death may be paid as a lump sum, in monthly installments over 60, 120, or 180
months, or in a combination of a partial lump sum and installments. Any such
deferred compensation is paid as a single lump sum or in three annual
installments upon any other discontinuance of service as a director. Directors
may elect at the time of deferral to receive payment on a fixed date. Deferred
amounts may also be paid in connection with a change in control of EIX or SCE in
certain circumstances.
Deferred stock units may be deferred until
retirement, death or discontinuance of service as a director, and when payable
will be distributed in EIX Common Stock. Payment will be made in a lump sum upon
the directors retirement, unless a request to receive distribution in annual
installments over 5, 10, or 15 years was previously approved. Discontinuance of
service as a director prior to retirement will result in a lump sum payout of
deferred stock units. Upon the directors death, any remaining deferred stock
unit balance will be paid to the directors beneficiary in a lump
sum.
Deferred stock units may also be paid in
connection with a change in control of EIX or SCE in certain
circumstances.
2017 Proxy
Statement
|
|
15
|
Table of Contents
ITEM 1: ELECTION OF
DIRECTORS
Payment of 2008 Plan
Benefits
Any amounts deferred under the
2008 plan document (including deferred stock units) may be deferred until a
specified date no later than the date the director turns age 75, retirement,
death, disability or other separation from service. Directors have sub-accounts
for each annual deferral for which the following forms of payment may be
elected:
●
|
Single
lump-sum;
|
●
|
Two to fifteen annual
installments;
|
●
|
Monthly installments for 60 to
180 months; or
|
●
|
Any combination of the
above.
|
Payments triggered by retirement, death,
disability or other separation from service may begin upon the applicable
triggering event or a specified number of months and/or years following the
applicable triggering event. However, payments may not begin later than the
directors 75
th
birthday unless the director is still on the Board.
Payments are subject to certain administrative earliest payment date rules, and
may be delayed or accelerated under the 2008 plan document if permitted or
required under Section 409A of the Internal Revenue Code.
If a director who was eligible to
participate in the plan by December 31, 2008 dies within ten years of his or her
initial eligibility to participate in the plan, the directors remaining
deferred compensation account balance will be doubled and paid to his or her
beneficiary. However, deferred stock units and any amounts attributable to
dividend equivalents previously associated with stock options will not be
doubled. All amounts payable are treated as obligations of EIX.
Determination of
Director Compensation
The Board makes all decisions regarding
director compensation. These decisions are normally made after receiving
recommendations from the Compensation Committee. The Compensation Committee
makes its recommendations after receiving input from its independent
compensation consultant and management. The Compensation Committee retained Pay
Governance LLC (Pay Governance) to evaluate and make recommendations regarding
director compensation for 2016. Pay Governances assistance included helping the
Compensation Committee identify industry trends and norms for director
compensation, reviewing and identifying peer group companies, and evaluating
director compensation data for these companies. The changes made to director
compensation in 2016, including the additional cash retainer and equity award
for the Chair of the EIX Board, were based on analysis and recommendations
provided by Pay Governance. Managements input focuses on legal, compliance, and
administrative issues.
16
|
|
2017 Proxy
Statement
|
Table of Contents
ITEM 1: ELECTION OF
DIRECTORS
Directors, Director
Nominees and Executive Officers
The following table shows the number of
shares of EIX Common Stock beneficially owned as of March 3, 2017, except as
otherwise indicated, by each of our directors, director nominees, officers and
former officers named in the EIX and SCE Summary Compensation Tables (NEOs),
and our current directors and executive officers as a group. None of the persons
in the table beneficially owns any other equity securities of the Company or its
subsidiaries. The table includes shares that the individual has a right to
acquire through May 3, 2017.
Name of Beneficial
Owner
|
|
Category
|
|
Deferred
Stock
Units
(1)
|
|
Stock
Options
|
|
Common
Stock
Shares
(2)
|
|
Total
Shares
Beneficially
Owned
(3)
|
|
Percent
of
Class
(4)
|
Jagjeet S. Bindra
|
|
Director
|
|
3,581
|
|
|
|
8,357
|
|
11,938
|
|
*
|
Vanessa C.L. Chang
|
|
Director/Nominee
|
|
5,410
|
|
7,500
|
|
113
|
|
13,023
|
|
*
|
Louis Hernandez, Jr.
|
|
Director/Nominee
|
|
930
|
|
|
|
|
|
930
|
|
*
|
James T. Morris
|
|
Director/Nominee
|
|
393
|
|
|
|
|
|
393
|
|
*
|
Kevin M. Payne
|
|
SCE
Director/Nominee
|
|
|
|
42,918
|
|
6,649
|
|
49,567
|
|
*
|
|
|
EIX/SCE NEO
|
|
|
|
|
|
|
|
|
|
|
Pedro J. Pizarro
|
|
Director/Nominee
|
|
|
|
134,411
|
|
38,734
|
|
173,145
|
|
*
|
|
|
EIX/SCE NEO
|
|
|
|
|
|
|
|
|
|
|
Richard T. Schlosberg, III
|
|
Director
|
|
39,944
|
|
|
|
5,000
|
|
44,944
|
|
*
|
Linda G. Stuntz
|
|
Director/Nominee
|
|
632
|
|
|
|
1,000
|
|
1,632
|
|
*
|
William P. Sullivan
|
|
Director/Nominee
|
|
|
|
|
|
4,214
|
|
4,214
|
|
*
|
Ellen O. Tauscher
|
|
Director/Nominee
|
|
4,581
|
|
|
|
217
|
|
4,798
|
|
*
|
Peter J. Taylor
|
|
Director/Nominee
|
|
|
|
|
|
1,965
|
|
1,965
|
|
*
|
Brett White
|
|
Director/Nominee
|
|
27,034
|
|
7,500
|
|
|
|
34,534
|
|
*
|
Ronald L. Litzinger
|
|
EIX NEO
|
|
|
|
624,920
|
|
67,190
|
|
690,210
|
|
*
|
Adam S. Umanoff
|
|
EIX NEO
|
|
|
|
60,790
|
|
994
|
|
61,784
|
|
*
|
Maria Rigatti
|
|
EIX/SCE NEO
|
|
|
|
30,567
|
|
14,868
|
|
45,435
|
|
*
|
William M. Petmecky, III
|
|
SCE NEO
|
|
|
|
8,029
|
|
1,781
|
|
9,810
|
|
*
|
Ronald O. Nichols
|
|
SCE NEO
|
|
|
|
21,048
|
|
3,371
|
|
24,419
|
|
*
|
Russell C. Swartz
|
|
SCE NEO
|
|
|
|
182,236
|
|
24,538
|
|
206,774
|
|
*
|
Peter T. Dietrich
(5)
|
|
SCE NEO
|
|
|
|
68,594
|
|
16,171
|
|
84,765
|
|
*
|
Theodore F. Craver, Jr.
(6)
|
|
EIX NEO
|
|
|
|
2,448,181
|
|
287,168
|
|
2,735,349
|
|
*
|
W. James Scilacci
(7)
|
|
EIX NEO
|
|
|
|
391,306
|
|
46,301
|
|
437,607
|
|
*
|
EIX Directors
and Executive Officers
|
|
82,505
|
|
1,075,396
|
|
169,259
|
|
1,327,160
|
|
*
|
as a Group (20 individuals)
|
|
|
|
|
|
|
|
|
|
|
|
|
SCE Directors and Executive Officers
|
|
82,505
|
|
505,886
|
|
113,671
|
|
702,062
|
|
*
|
as a Group (17 individuals)
|
|
|
|
|
|
|
|
|
|
|
|
|
(1)
|
The reported number
consists only of deferred stock units that could be settled in shares of
EIX Common Stock within 60 days at the directors discretion (for example,
by retirement). However, all deferred stock units held by a director count
toward the stock ownership requirement for directors. In addition to the
deferred stock units reported in this table, Messrs. Taylor and Morris
hold 12,403 and 1,573 fully-vested deferred stock units, and Mses. Chang,
Stuntz and Tauscher hold 21,638, 5,690, and 1,091 fully-vested deferred
stock units, respectively. These additional deferred stock units will also
be settled in shares of EIX Common Stock, but in accordance with SEC rules
are not included in the table because they cannot be settled in shares of
EIX Common Stock within 60 days at the directors
discretion.
|
(2)
|
Except as follows,
each individual has sole voting and investment power:
|
|
Shared voting and
sole investment power: Mr. Payne 2,184; Ms. Rigatti 5,553; Mr. Umanoff
994; Mr. Nichols 1,779; all EIX directors and executive officers as a
group 16,022; and all SCE directors and executive officers as a group
9,579.
|
|
Shared voting and
shared investment power: Mr. Bindra 8,357; Ms. Chang 113; Mr. Litzinger
61,389; Mr. Nichols 295; all EIX directors and executive officers as a
group 71,660; and all SCE directors and executive officers as a group
8,765.
|
(3)
|
Includes shares
listed in the three columns to the left.
|
(4)
|
Each individual
beneficially owns less than 1% of the shares of EIX Common
Stock.
|
(5)
|
Mr. Dietrich
retired as SCE Senior Vice President effective January 20, 2017. His EIX
Common Stock shares are reported as of January 20, 2017.
|
(6)
|
Mr. Craver retired
as EIX Chairman and CEO effective September 30, 2016. His EIX Common Stock
shares are reported as of December 28, 2017.
|
(7)
|
Mr. Scilacci
retired as EIX Executive Vice President and Chief Financial Officer
effective September 30, 2016. His EIX Common Stock shares are reported as
of December 21, 2016.
|
2017 Proxy
Statement
|
|
17
|
Table of Contents
ITEM 1: ELECTION OF
DIRECTORS
Other
Shareholders
The following are the only shareholders
known to beneficially own more than 5% of any class of EIX or SCE voting
securities as of December 31, 2016, except as otherwise indicated:
Title of Class of Stock
|
|
Name and Address of
Beneficial Owner
|
|
Amount and Nature of
Beneficial Ownership
|
|
Percent
of Class
|
EIX Common Stock
|
|
The Vanguard
Group
|
|
25,636,237
(1)
|
|
7.9%
|
|
|
100 Vanguard
Blvd.
|
|
|
|
|
|
|
Malvern, PA 19355
|
|
|
|
|
EIX Common Stock
|
|
State Street Corporation
|
|
25,631,157
(2)
|
|
7.9%
|
|
|
One Lincoln Street
|
|
|
|
|
|
|
Boston, MA 02111
|
|
|
|
|
EIX Common Stock
|
|
BlackRock Inc.
|
|
23,356,460
(3)
|
|
7.2%
|
|
|
55 East
52
nd
Street
|
|
|
|
|
|
|
New York, NY 10055
|
|
|
|
|
EIX Common Stock
|
|
JPMorgan Chase & Co.
|
|
16,898,630
(4)
|
|
5.1%
|
|
|
270 Park Ave.
|
|
|
|
|
|
|
New
York, NY 10017
|
|
|
|
|
SCE Common Stock
|
|
Edison
International
|
|
434,888,104
(5)
|
|
100%
|
|
|
2244 Walnut Grove
Avenue
|
|
|
|
|
|
|
Rosemead, CA 91770
|
|
|
|
|
(1)
|
This information is
based on a Schedule 13G filed with the SEC on February 9, 2017. The
Vanguard Group reports it has sole voting power over 549,552 shares,
shared voting power over 64,792 shares, sole investment power over
25,063,409 shares, and shared investment power over 572,828
shares.
|
(2)
|
This information is
based on a Schedule 13G filed with the SEC on February 14, 2017. Acting in
various fiduciary capacities, State Street reports it has shared voting
and investment power over all shares. This includes 8,900,259 shares, or
2.7% of the class, held by State Street as the 401(k) Plan Trustee. 401(k)
Plan shares are voted in accordance with instructions given by
participants, whether vested or not. 401(k) Plan shares for which
instructions are not received will be voted by the 401(k) Plan trustee in
the same proportion to the 401(k) Plan shares voted by other 401(k) Plan
Shareholders, unless contrary to ERISA.
|
(3)
|
This information is
based on a Schedule 13G filed with the SEC on January 24, 2017. BlackRock
Inc. reports it has sole voting power over 20,271,273 shares and sole
investment power over all shares.
|
(4)
|
This information is
based on a Schedule 13G filed with the SEC on January 19, 2017. JPMorgan
Chase reports it has sole voting power over 15,311,419 shares, shared
voting power over 105,858 shares, sole investment power over 16,683,688
shares, and shared investment power over 214,284 shares.
|
(5)
|
EIX became the
holder of all issued and outstanding shares of SCE Common Stock on July 1,
1988, when it became the holding company of SCE. EIX continues to have
sole voting and investment power over these
shares.
|
18
|
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2017 Proxy
Statement
|
Table of Contents
ITEM 2: RATIFICATION
OF THE APPOINTMENT OF THE INDEPENDENT REGISTERED PUBLIC ACCOUNTING
FIRM
The Audit Committee is directly
responsible for the appointment, compensation, retention and oversight of the
Independent Auditor retained to audit the Companys financial statements. The
Audit Committee has selected PricewaterhouseCoopers LLP (PwC) as the Companys
Independent Auditor for calendar year 2017. The Company is asking shareholders
to ratify this appointment.
PwC is an international accounting firm
which provides leadership in public utility accounting matters. Representatives
of PwC are expected to attend the Annual Meeting to respond to appropriate
questions and to make a statement if they wish.
PwC has been retained as the Companys
Independent Auditor continuously since 2002. The Audit Committee has adopted
restrictions on hiring certain persons formerly associated with PwC into an
accounting or financial reporting oversight role to help ensure PwCs continuing
independence.
The Audit Committee meets annually in
executive session without PwC present to evaluate the quality of PwCs audit
services and their performance, including PwCs industry knowledge from an
accounting and tax perspective, PwCs continued independence and professional
skepticism, the Committees discussions with management about PwCs performance,
and information available from Public Company Accounting Oversight Board
(PCAOB) inspection reports.
The Audit Committee annually considers
whether the Independent Auditor firm should be reappointed for another year. The
lead engagement partner is required to rotate off the Companys audit every five
years. The Audit Committee is involved in the selection of the lead engagement
partner. In 2015, in connection with the mandated rotation of PwCs lead
engagement partner effective beginning with PwCs
audit of the Companys 2016 financial statements, the Company interviewed
candidates who met professional, industry and personal criteria, and selected
finalists. The Audit Committee Chair participated in interviews with the
finalists and selected the lead engagement partner, in consultation with the
Audit Committee.
The Audit Committee considered several
factors when determining whether to reappoint PwC as the Companys Independent
Auditor, including:
●
|
The length of time PwC has been
engaged;
|
●
|
PwCs knowledge of the Company and
its personnel, processes, accounting systems and risk
profile;
|
●
|
The quality of the Audit Committees
ongoing discussions with PwC, their independence and professional
skepticism; and
|
●
|
An assessment of the professional
qualifications, utility industry experience and past performance of PwC,
its lead engagement partner, and other members of the core engagement
team.
|
The Audit Committee and the Board believe
that the continued retention of PwC to serve as the Companys Independent
Auditor is in the best interests of the Company and its investors.
The Company is not required to submit this
appointment to a shareholder vote. Ratification would be advisory only. However,
if the shareholders of either EIX or SCE do not ratify the appointment, the
Audit Committee will investigate the reasons for rejection by the shareholders
and will reconsider the appointment.
The Board
recommends you vote FOR Item 2.
|
2017 Proxy
Statement
|
|
19
|
Table of Contents
ITEM 2: RATIFICATION
OF THE APPOINTMENT OF THE INDEPENDENT REGISTERED PUBLIC ACCOUNTING
FIRM
The following table sets forth the
aggregate fees billed by PwC to EIX (consolidated total including EIX and its
subsidiaries) and SCE, respectively, for the fiscal years ended December 31,
2016 and December 31, 2015:
|
|
EIX and Subsidiaries
($000)
|
|
SCE ($000)
|
Type of Fee
|
|
2016
|
|
2015
|
|
2016
|
|
2015
|
Audit Fees
(1)
|
|
$6,511
|
|
$6,326
|
|
$5,632
|
|
$5,488
|
Audit-Related Fees
(2)
|
|
60
|
|
240
|
|
60
|
|
240
|
Tax Fees
(3)
|
|
693
|
|
1,402
|
|
389
|
|
713
|
All
Other Fees
(4)
|
|
96
|
|
1,248
|
|
96
|
|
1,248
|
TOTAL
|
|
$7,360
|
|
$9,216
|
|
$6,177
|
|
$7,689
|
(1)
|
These represent fees for
professional services provided in connection with the audit of the
Companys annual financial statements and internal controls over financial
reporting, and reviews of the Companys quarterly financial
statements.
|
(2)
|
These represent fees for
assurance and related services related to the performance of the audit or
review of the financial statements and not reported under Audit Fees
above.
|
(3)
|
These represent fees for
tax-related compliance and other tax-related services to support
compliance with federal and state tax reporting and payment requirements,
including tax return review and review of tax laws, regulations or
cases.
|
(4)
|
These represent fees for
consulting services related to San Onofre Nuclear Generating Station
decommissioning and other miscellaneous
services.
|
The Audit Committee annually approves all
proposed audit fees in executive session without PwC present, considering
several factors, including a breakdown of the services to be provided, proposed
staffing and hourly rates, and changes in the Company and industry from the
prior year. The audit fees are the culmination of a process which included a
comparison of the prior years proposed fees to actual fees incurred and fee
proposals for known and anticipated 2016 services in the audit, audit-related,
tax and other categories. The Audit Committees deliberations consider balancing
the design of an audit scope that will achieve a high quality audit with driving
efficiencies from both the Company and PwC while compensating PwC fairly.
The Audit Committee is required to
pre-approve all audit and permitted non-audit services performed by PwC to
ensure these services will not impair the firms independence.
The Audit Committee has delegated to the
Committee Chair the authority to pre-approve services between Committee
meetings, provided that any pre-approval decisions are presented to the
Committee at its next meeting. PwC must assure that all audit and non-audit
services provided to the Company have been approved by the Audit
Committee.
During the fiscal year ended December 31,
2016, all services performed by PwC were pre-approved by the Audit Committee,
irrespective of whether the services required pre-approval under the Exchange
Act.
20
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2017 Proxy
Statement
|
Table of Contents
ITEM 2: RATIFICATION
OF THE APPOINTMENT OF THE INDEPENDENT REGISTERED PUBLIC ACCOUNTING
FIRM
The Audit Committee is composed of five
independent directors and operates under a charter adopted by the Board, which
is posted on our website at
www.edison.com/corpgov
. The Audit
Committee complied with the requirements of its charter in 2016.
The Board has
determined that each Audit Committee member is independent and financially
literate, and that at least one member has accounting or other related financial
management expertise, as such qualifications are defined by NYSE rules, our
Corporate Governance Guidelines, and/or the Committee charter. The Board has
also determined that directors Chang, Hernandez and Taylor each qualify as an
audit committee financial expert as defined by SEC rules.
The Audit Committees key
responsibilities are described above under
Board Committees Audit Committee.
The Audit Committees role in risk oversight is described above
under
Our Corporate Governance What is the
Boards role in risk oversight?
Audit Committee meeting agendas are
developed based on input from each Committee member, the Independent Auditor,
the General Auditor, and management. In 2016, the Committee requested and
received presentations on significant risk issues and a variety of topics, such
as:
●
|
Power procurement accounting;
|
●
|
New accounting standards related to revenue recognition and
lease accounting;
|
●
|
The Companys privacy compliance program; and
|
●
|
Records management.
|
Management is responsible for the
Companys internal controls and the financial reporting process, including the
integrity and objectivity of the financial statements. The Independent Auditor performs an independent audit of the Companys
financial statements under the standards of the PCAOB and issues a report on the
financial statements. The Audit Committee monitors and oversees these processes.
The Committee members are not accountants or auditors by profession and
therefore have relied on certain representations from management and the
Independent Auditor in carrying out their responsibilities.
In discharging our
oversight responsibilities in connection with the December 31, 2016 financial
statements, the Audit Committee:
●
|
Reviewed and discussed the audited financial statements with
the Companys management and the Independent Auditor;
|
●
|
Discussed various matters with the Independent Auditor,
including matters required by the PCAOBs standard Communications with
Audit Committees; and
|
●
|
Received the written disclosures and PwCs
letter confirming its independence from the Company, and discussed such
independence with PwC.
|
Based upon these reviews and
discussions, the Audit Committee recommended to the Board that the audited
financial statements be included in the Companys 2016 Annual Report to be filed
with the SEC.
Peter J. Taylor, Chair
Vanessa C.L.
Chang
Louis Hernandez, Jr.
James T. Morris
Ellen O. Tauscher
2017 Proxy
Statement
|
|
21
|
Table of Contents
ITEM 3: ADVISORY
VOTE TO APPROVE THE COMPANYS EXECUTIVE COMPENSATION
The advisory vote to approve the
Companys executive compensation, commonly known as Say-on-Pay, gives
shareholders the opportunity to endorse or not endorse our executive
compensation. This advisory vote is required by SEC rules to be provided at
least once every three years. However, in 2011, our shareholders voted in favor
of holding the advisory vote every year, and the Board determined that it would
be held annually. The Companys Say-on-Pay proposal received support from at
least 91% of the votes cast in each of the last six years.
Our executive compensation program is
described under
Compensation Discussion and
Analysis
below. We encourage you to read it
carefully. Our executive compensation program is reviewed and approved by the
Compensation Committee. The Board believes our executive compensation structure
is competitive, aligns compensation with shareholder value and serves
shareholders well.
EIX and SCE request shareholder
approval of the compensation paid to the Companys named executive officers, as
disclosed in this Proxy Statement under the SECs compensation disclosure rules, including the Compensation Discussion and
Analysis, the compensation tables and the narrative discussion that accompanies
the compensation tables.
The Company values constructive
dialogue with shareholders on compensation and other important governance
matters. Because your vote is advisory, it will not be binding on the Board or
the Company and will not be construed as overruling a decision by the Board or
the Company. However, the Compensation Committee will consider the outcome of
the vote and any constructive feedback from shareholders when making future
executive compensation decisions. See
Compensation Summary Shareholder Communication and Compensation Program
for 2017
.
It is expected that the next Say-on-Pay
vote will occur at the 2018 Annual Meeting.
The Board recommends you vote FOR Item
3.
|
22
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2017 Proxy
Statement
|
Table of Contents
ITEM 4: ADVISORY
VOTE ON THE FREQUENCY OF SAY-ON-PAY VOTES
Item 3 above provides our shareholders
the opportunity to cast an advisory Say-on-Pay vote to endorse or not endorse
the compensation of our named executive officers. In 2011, our shareholders
voted in favor of holding the Say-on-Pay vote every year, and the Board
determined that it would be held annually. The Board continues to believe that
Say-on-Pay votes should be conducted every year so that shareholders may
annually express their views on the Companys executive compensation
program.
SEC rules require that at least every
six years the Company provide our shareholders the opportunity to cast an
advisory vote on how often we should include a Say-on-Pay proposal in our proxy
materials for future shareholder meetings at which directors will be elected and
for which we must include executive compensation
information in the proxy statement for that meeting. Under this Item 4,
shareholders are given the choice in the proxy card to vote to have the
Say-on-Pay vote every year, every two years or every three years, or abstain
from voting. Therefore, shareholders will not be voting to approve or disapprove
the Boards specific recommendation.
Like the Say-on-Pay vote, your vote on
this Item 4 is advisory and will not be binding upon the Board or the Company.
However, the Board and its Compensation Committee value the opinions expressed
by shareholders and will take into account the outcome of the vote when
considering the frequency of future Say-on-Pay votes.
The Board recommends you vote to hold the Say-on-Pay vote
every year.
|
2017 Proxy
Statement
|
|
23
|
Table of Contents
COMPENSATION
DISCUSSION AND ANALYSIS
This Compensation Discussion and
Analysis (CD&A) describes the principles of our executive compensation
program, how we applied those principles in compensating our named executive
officers (NEOs) for 2016, and how we use our compensation program to drive
performance. We also discuss the roles and responsibilities of our Compensation
Committee (the Committee) in determining executive compensation. The CD&A
is organized as follows:
●
|
Compensation Summary
|
●
|
What We Pay and Why: Elements of Total Direct
Compensation
|
●
|
How We Make Compensation Decisions
|
●
|
Post-Employment and Other Benefits
|
●
|
Other Compensation Policies and
Guidelines
|
The CD&A contains information
relevant to your decision regarding the advisory vote to approve our executive
compensation (Item 3 on your Proxy Card). When voting on Item 3, EIX
shareholders will vote on EIX executive compensation, while SCE shareholders
will vote on SCE executive compensation.
Certain key information about our
executive compensation program is highlighted in this Compensation
Summary.
Executive Compensation
Practices
Our executive compensation program is
designed with the objective of strongly linking pay with performance. The table
below highlights our current compensation practices for NEOs, including
practices we believe drive performance and are aligned with good governance
principles, and practices we have not implemented because we do not believe they
would serve our shareholders long-term interests.
What We Do
|
|
What We Dont
Do
|
✓
We tie pay to performance by making the majority of
compensation at risk and linking it to shareholders interests
|
|
✗
We do not have any employment contracts
|
✓
We target a competitive range around the market median
for base salary and annual and long-term incentives
|
|
✗
We do not provide excise tax gross-ups on change in
control payments
|
✓
We compare executive compensation to a peer group
defined by a recognized market index
|
|
✗
We do not have individually negotiated change in control
agreements
|
✓
We balance multiple metrics for annual and long-term
incentives
|
|
✗
We do not provide perquisites
|
✓
We have double-trigger change in control provisions for
equity award vesting
|
|
✗
We do not provide personal use of any corporate
aircraft
|
✓
We seek shareholder feedback on our executive
compensation program and share the feedback with the Board and the
Committee
|
|
✗
We do not reprice or allow the cash buyout of stock
options with exercise prices below the current market value of EIX Common
Stock
|
✓
We have stock ownership guidelines, which include
holding requirements, and an incentive compensation clawback
policy
|
|
✗
We do not permit pledging of Company securities by
directors or EIX executive officers
|
✓
Our Committees compensation consultant is independent
and does not provide any other services to the Company
|
|
✗
We do not permit hedging of Company securities by
directors or employees
|
24
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2017 Proxy
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|
Table of Contents
COMPENSATION
DISCUSSION AND ANALYSIS
Leadership
Transition
The 2016 compensation of NEOs reported
in the tables below reflects compensation changes resulting from our leadership
transition during 2016. As discussed above, effective September 30, 2016,
Theodore F. Craver, Jr. retired from his position as EIXs Chairman and CEO, and
Pedro J. Pizarro succeeded him as EIX CEO. Effective June 1, 2016, Mr. Pizarro
became EIX President, Kevin M. Payne became SCE CEO and Ronald O. Nichols became
SCE President.
In addition, effective September 30,
2016, W. James Scilacci retired from his position as EIX Executive Vice
President (EVP) and Chief Financial Officer (CFO), and Maria Rigatti
succeeded him. William M. Petmecky, III was promoted effective September 30,
2016 to replace Ms. Rigatti as SCEs Senior Vice President (SVP) and
CFO.
The Committee generally targets a
competitive range of +/-15% around the market median for base salary and annual
and long-term incentives for each NEO position. However, the Committee set
compensation for most of the newly promoted NEOs below this range for their new
positions, with the opportunity for increases after evaluating their performance
in their new positions. More information is under
What We Pay and Why:
Elements of Total Direct Compensation
and
How We Make Compensation
Decisions: Use of Competitive Data
.
The two charts below in this
"
Compensation Summary
" compare EIX CEO pay to EIXs performance and to
peer group median pay for a five-year period. Since Mr. Craver served as EIX CEO
during all but the last three months of this period, his compensation is used
for these purposes.
EIX NEOs for
2016
EIX NEOs are identified below. EIX
shareholders will vote on EIX executive compensation.
EIX NEOs
|
|
Title
|
Pedro J. Pizarro
|
|
EIX CEO effective 9/30/16; EIX President effective
6/1/16; SCE President through 5/31/16
|
Theodore F. Craver, Jr.
|
|
EIX
Chairman of the Board and CEO through 9/30/16; also EIX President through
5/31/16
|
Maria Rigatti
|
|
EIX EVP and CFO effective 9/30/16; SCE SVP and CFO
through 9/30/16
|
W.
James Scilacci
|
|
EIX
EVP and CFO through 9/30/16
|
Adam S. Umanoff
|
|
EIX EVP and General Counsel
|
Kevin M. Payne
|
|
SCE
CEO effective 6/1/16; SCE SVP through 5/31/16
|
Ronald L. Litzinger
|
|
Edison Energy Group (EEG) President; also EIX EVP
through 3/28/16
|
SCE NEOs for
2016
SCE NEOs are identified below. SCE
shareholders will vote on SCE executive compensation.
SCE NEOs
|
|
Title
|
Kevin M. Payne
|
|
CEO effective 6/1/16; SVP through 5/31/16
|
Pedro J. Pizarro
|
|
President through 5/31/16
|
William M. Petmecky, III
|
|
SVP and CFO effective 9/30/16; Vice President and
Treasurer through 9/30/16
|
Maria Rigatti
|
|
SVP
and CFO through 9/30/16
|
Ronald O. Nichols
|
|
President effective 6/1/16; SVP through
5/31/16
|
Russell C. Swartz
|
|
SVP
and General Counsel
|
Peter T. Dietrich
|
|
SVP through 1/20/17
|
Executive Benefit
Changes
In the last two years, the Committee
has approved changes to various executive benefits after a thorough review of
our compensation and benefits program. The key changes are below. More
information is under
Potential Payments Upon
Termination or Change in Control Executive Survivor Benefit
Plan,
Other Compensation Policies and Guidelines Stock Ownership
Guidelines,
Non-Qualified Deferred Compensation Executive Deferred Compensation
Plan
and
Pension Benefits Executive Retirement Plan
.
Benefit
|
|
Change
|
|
Effective Date
|
Key Objectives of Changes
|
Executive Survivor
Benefit Plan
|
|
Terminated
|
|
December 31, 2016
|
●
Decrease portion of compensation and benefits package
not directly tied to performance
●
Simplify benefits for new executives
●
Continue strong compliance with Stock Ownership
Guidelines for Officers
|
Long-Term Incentive
Awards
|
|
Added holding requirements for officers subject to Stock
Ownership Guidelines
|
|
February 22, 2017
|
Executive Deferred
Compensation Plan
|
|
Eliminated matching
contributions
|
|
January 1, 2018
|
Executive
Retirement Plan
|
|
Reduced plan benefit
|
|
January 1, 2018
|
2017 Proxy
Statement
|
|
25
|
Table of Contents
COMPENSATION
DISCUSSION AND ANALYSIS
Elements and
Objectives of Total Direct Compensation
Element
|
|
Form
|
|
Key
Objective
|
|
% of EIX CEO Target
Total
Direct Compensation*
|
Base Salary
|
|
Fixed Pay: Cash
|
|
Establish a pay foundation to
attract and retain qualified executives
|
|
14%
|
Annual Incentive
Awards
|
|
Variable Pay: Cash
|
|
Focus executives attention on specific financial,
strategic and operating objectives of the Company that we believe will
increase shareholder value and benefit customers
|
|
15%
|
Long-Term
Incentive Awards
|
|
Variable Pay:
Equity
|
|
Align executive pay with long-term
value provided to shareholders
|
|
71%
|
|
●
50% stock options
|
|
●
Link compensation to stock price
increase
|
|
|
|
●
25% performance shares
|
|
●
Reward relative shareholder return compared to peers and
earnings per share compared to pre-established targets
|
|
|
|
●
25% restricted stock units
|
|
●
Encourage retention, with value tied to absolute
shareholder return
|
|
|
*
|
In
this CD&A, the term target total direct compensation means the sum
of the NEOs salary, target annual incentive award, and grant date fair
value of long-term incentive awards for the particular year. The 2016
target total direct compensation of Messrs. Craver and Pizarro was
averaged to calculate the disclosed % of EIX CEO Target Total Direct
Compensation.
|
Alignment of EIX
CEO Pay with Performance
During the five-year period from 2012
to 2016, EIXs TSR
1
was approximately 100%. Mr. Cravers total direct
compensation changed by less than 10% during the period. Total direct
compensation or TDC means the sum of base salary, the actual annual incentive
award paid for the year and the grant date fair value of long-term incentive
awards (columns (c), (e), (f) and (g) of the Summary Compensation Table) for the
NEO for the year.
The following chart shows the alignment
over the past five years between Mr. Cravers total direct compensation and our
indexed TSR, which represents the value of an initial investment of $100 in EIX
common stock at the beginning of the five-year period, and assumes that
dividends are reinvested on the ex-dividend date. For purposes of comparison,
the 2016 CEO TDC in the chart represents Mr. Cravers pro forma total direct
compensation for the full 2016 year, assuming he continued receiving the same
salary rate and annual incentive award as a percent of salary for the remainder
of the year.
EIX CEO Total Direct Compensation
(TDC)
vs. Indexed TSR 2012-2016
(1)
|
In this Proxy Statement, for all purposes other than
performance share payouts, TSR is calculated using the difference between
(i) the closing stock price for the relevant stock on the last NYSE
trading day preceding the first day of the relevant period and (ii) the
closing stock price for the relevant stock on the last trading day of the
relevant period, and assumes all dividends during the period are
reinvested on the ex-dividend date. Under this methodology, EIXs
2014-2016 TSR was at the 90th percentile of the Philadelphia Utility
Index. A different methodology is used to determine performance share
payouts: TSR is calculated using the difference between (i) the average
closing stock price for the stock for the 20 trading days ending with the
last NYSE trading day preceding the first day of the performance period
and (ii) the average closing stock price for the stock for the 20 trading
days ending with the last trading day of the performance period, and
assumes all dividends are reinvested on the ex-dividend date (see
Long-Term Incentive Awards below). Under this methodology, EIXs TSR for
the 2014-2016 performance period was also at the 90th percentile of the
Philadelphia Utility Index.
|
26
|
|
2017 Proxy
Statement
|
Table of Contents
COMPENSATION
DISCUSSION AND ANALYSIS
Comparison of EIX
CEO Pay with Peer Group
The following chart shows Mr. Cravers
total direct compensation for the last five years as reported in the EIX Summary
Compensation Table, compared to the median TDC for the chief executive officers
of the companies that comprise the Philadelphia Utility Index peer group. The
2016 CEO TDC in the chart represents Mr. Cravers pro forma total direct
compensation for the full 2016 year. (The 2016 Peer Median TDC in the chart is
the same as the 2015 Peer Median TDC, since peer group data for 2016 was
generally unavailable in time to include in this Proxy Statement.)
Mr. Cravers total direct compensation
was somewhat above the peer group median from 2012 through 2014, due primarily
to chief executive officer turnover at peer companies and annual incentive
awards for Mr. Craver that were significantly above-target, largely as a result
of above-target core earnings.
2
Mr. Cravers 2015 and pro forma 2016
total direct compensation was slightly below the peer group median, largely due
to the annual incentive awards at peer companies.
Mr. Pizarros total direct compensation
in 2016 was significantly below the peer group median for chief executive
officers. His compensation before the September 30 effective date of his
election as EIX CEO was targeted at the market median for his prior positions
(SCE President through May 31 and EIX President from June 1 through September
29). In addition, his annualized compensation after the effective date of his
election as EIX CEO was below the peer group median for chief executive
officers. For purposes of comparison, the following chart shows Mr. Pizarros
pro forma total direct compensation for 2016, based on the annualized
compensation the Committee approved in connection with the September 30, 2016
effective date of his election as EIX CEO.
EIX CEO vs. Peer Group Median
TDC
Shareholder
Communication and Compensation Program for 2017
We seek and value input from our
shareholders. In 2016, we engaged with our major institutional shareholders to
discuss the Companys corporate governance, executive compensation, and business
strategy. Management shared the feedback received from these discussions with
the Board and relevant Board committees.
EIXs Say-on-Pay proposal received
support from approximately 96% of the votes cast in 2016. The Committee reviewed
the results of the shareholder vote, including feedback from major shareholders.
Taking the vote results and shareholder feedback into account, and considering
trends in executive compensation and the best interests of shareholders, the
Committee approved maintaining our executive compensation program with the
following changes for 2017: the previously-approved termination of the Executive
Survivor Benefit Plan went into effect; and the Companys stock ownership
guidelines were amended February 22, 2017 to implement holding restrictions for
EIX common stock acquired pursuant to long-term incentive awards. More
information is under
Potential Payments Upon
Termination or Change in Control Executive Survivor Benefit
Plan
and
Other Compensation Policies and Guidelines Stock Ownership
Guidelines
.
What We Pay and Why: Elements of Total Direct
Compensation
|
We generally target a competitive range
of +/-15% around the market median for each element of total direct compensation
offered under our program: base salaries, annual cash incentives, and long-term
equity-based incentives. The reasons for the Committees decision to target the
competitive range around the median level include:
●
|
The
policy of the applicable regulatory authorities that SCE should provide
market level compensation, and the desire for internal compensation equity
between EIX and SCE;
|
●
|
Above-median compensation usually is not
needed, except occasionally for recruitment and retention purposes and to
reward exceptional performers; and
|
(2)
|
Core earnings is defined on a
consolidated basis for EIX as earnings attributable to EIX shareholders
less non-core items. Non-core items include income or loss from
discontinued operations, income resulting from allocation of losses to tax
equity investor under the HLBV accounting method and income or loss from
significant discrete items that management does not consider
representative of ongoing earnings, such as: exit activities, including
sale of certain assets and other activities that are
no longer continuing, write downs, asset impairments and
other gains or losses related to certain tax, regulatory or legal
settlements or proceedings. For a reconciliation of core earnings to net
income determined under GAAP, see Managements Discussion and Analysis of
Financial Condition and Results of Operations Management Overview
Highlights of Operating Results included as part of the Companys 2016
Annual Report.
|
2017 Proxy
Statement
|
|
27
|
Table of Contents
COMPENSATION
DISCUSSION AND ANALYSIS
●
|
Below-median compensation would create
retention and recruitment difficulties.
|
A significant portion of our
executives total direct compensation is tied to company performance. The
following charts show that incentive compensation comprised approximately 86% of
EIX CEO 2016 target total direct compensation and approximately 70% of EIXs and
SCEs other NEOs 2016 target total direct compensation.
EIX CEO Pay Mix
Other NEO Pay Mix
This pay mix provides an opportunity
for NEO compensation to reflect the upside and downside potential of company
performance and helps to focus NEOs attention on our financial, strategic and
operating objectives, and shareholder returns.
Base
Salary
For 2016, each NEOs base salary was
evaluated according to his or her position and performance. For each position, a
market base salary range was determined. The median of the range was the market
median level of base salaries for comparable positions. We do not have
employment contracts and our NEOs do not have contractual rights to receive
fixed base salaries.
In connection with the leadership transition during 2016,
the Committee increased the annual base salary rates of Messrs. Pizarro, Payne,
Petmecky, and Nichols and Ms. Rigatti. After
their respective final promotions for 2016, these NEOs annual base
salary rates were approximately 10-40% below the market median for their
respective new positions. Each NEO has an opportunity for an increase in his or
her annual base salary rate in 2017 after the NEOs performance in the new
position is evaluated.
In addition, in early 2016, the
Committee increased the base salary rates of Messrs. Scilacci and Umanoff and
set them within 1% of the market median for their respective
positions.
Annual Incentive
Awards
Executive Incentive
Compensation Plan
NEOs are eligible for
annual incentive awards under the EIX Executive Incentive Compensation Plan for
achieving financial, strategic and operational goals that are established at the
beginning of each year. The goals are tied to the key elements of our strategy
described on page 1 and specific quantitative targets are set for most of the
goals.
The 2016 annual incentive award target
value for each NEO was set as a percentage of the NEOs base salary (the Annual
Incentive Target %). In connection with the leadership transition during 2016,
the Committee increased the Annual Incentive Target % for Messrs. Pizarro,
Payne, Petmecky, and Nichols and Ms. Rigatti, and set the respective Annual
Incentive Target % within ten percentage points of the market median for the new
positions. In addition, in early 2016, the Committee increased the respective
Annual Incentive Target % for Messrs. Craver, Scilacci, and Umanoff to bring it
closer to or approximately at the market median for their respective
positions.
The minimum annual incentive award is
$0. The maximum award is 200% of target, which the Committees independent
compensation consultant, Pay Governance, advised is the most prevalent practice
among the peer group companies.
The Committee determines annual
incentive awards based on corporate and individual performance. The corporate
performance factor is based on performance relative to the goals established at
the beginning of the year. For each goal category, the Committee assigned a
target score reflecting the relative weight given that goal category and a
potential score range. In February 2017, the Committee determined the score
achieved for each goal category, depending on the extent to which the goals were
unmet, met or exceeded.
Separate goals were established for EIX
and SCE. However, as reflected in the 2016 EIX Corporate Performance Scoring
Matrix below, many of EIXs goals related to SCEs performance. Annual incentive
awards for Messrs. Craver, Scilacci, Litzinger, and Umanoff were based on the
EIX corporate performance factor. Annual incentive awards for Messrs. Payne,
Petmecky, Dietrich, Nichols, and Swartz were based on the SCE corporate
performance factor. Mr. Pizarros and Ms. Rigattis annual incentive awards were
based on a blend of the EIX and SCE corporate performance factors, weighted
based upon the relative time each respectively served as an EIX officer and as
an SCE officer in 2016.
28
|
|
2017 Proxy
Statement
|
Table of Contents
COMPENSATION
DISCUSSION AND ANALYSIS
2016 EIX Corporate
Performance Scoring Matrix
Goal
Category
|
|
Key Goals/Performance
Contributing to Actual Score
|
|
Actual
Score
for
Goal
(2)
|
|
Target
Score
for
Goal
Category
|
|
Potential
Score
for
Goal
Category
|
|
Actual
Score
for
Goal
Category
(2)
|
Goal
(1)
|
|
Performance
(1)
|
Financial
Performance
|
|
●
Core earnings of $1.274 billion
|
|
●
Goal Exceeded:
$1.294
billion
(3)
|
|
66
|
|
60
|
|
0-120
|
|
66
|
Strategic
Initiatives
|
|
●
Execute SCE goals for affordable customer
rates
|
|
●
Goal Exceeded:
see SCE matrix below for additional
information
|
|
6
|
|
30
|
|
0-60
|
|
10
|
|
●
Obtain favorable outcome in SCEs Distribution Resources
Plan (DRP) (10-K, pgs. 5-6)
|
|
●
Goal Exceeded:
favorable market reaction to DRP; CPUC
acknowledged important link between DRP and SCEs General Rate
Case
|
|
5
|
|
|
|
|
|
|
|
●
Grow EEGs distributed energy
and commercial and industrial energy services businesses (10-K, pg. 106):
contract 150 megawatts (MW) and complete construction of 122 MW of
distributed solar projects; complete 20 MW of community solar projects and
20 MW of rural cooperative projects; sign 10 new contracts for advisory
and integrated solutions
|
|
●
Goal Not Met:
new contracts and completed projects below
target
|
|
2
|
|
|
|
|
|
|
|
●
Grow EEGs transmission
business: complete Grid Assurance investment decision (10-K, pg. 106);
submit two transmission bids
|
|
●
Goal Met:
completed Grid Assurance investment decision; submitted
two transmission bids
|
|
2
|
|
|
|
|
|
|
|
●
Evaluate business case for SCE
fiber business; prepare for 2017 launch
|
|
●
Goal Met:
SCE established business case and began implementing
fiber business
|
|
2
|
|
|
|
|
|
|
|
●
Propose three new business
opportunities; begin implementing one
|
|
●
Goal Met:
three new business opportunities evaluated; SCE
developed transportation electrification plan (10-K, pg.
6)
|
|
2
|
|
|
|
|
|
|
|
●
Evaluate business case for EEG
water business; begin operation of one pilot
project
|
|
●
Goal Partially
Met:
business case evaluated; decision
made to wind down business
|
|
1
|
|
|
|
|
|
|
|
●
Achieve SCE capital spending
targets
|
|
●
Goal Not Met:
see SCE matrix below for additional
information
|
|
0
|
|
|
|
|
|
|
|
●
No significant noncompliance
events; no worker or public safety issues; defend San Onofre settlement
agreement
(4)
|
|
●
Goal Not Met:
see SCE matrix below for additional
information
|
|
-10
|
|
|
|
|
|
|
People
and
Culture
|
|
●
Integrate new EEG companies;
develop and begin implementing plan for EEG human capital platform; hire
and retain key employees
|
|
●
Goal Exceeded:
integrated new companies; implemented human
capital platform; retained key employees
|
|
6
|
|
10
|
|
0-20
|
|
9
|
|
●
Diversify leadership pipeline
above 2015 levels: ethnic minorities 25.4% of executives and 39.8% of
leadership pool; women 27% of executives and 29.6% of leadership
pool
|
|
●
Goal Not Met:
increased ethnic minorities to 26.1% of executives
and 40.3% of leadership pool; did not increase women
in leadership
pipeline
|
|
3
|
|
|
|
|
|
|
Total:
|
|
|
|
|
|
|
|
100
|
|
0-200
|
|
85
|
(1)
|
The parenthetical 10-K page
references in the Goal and Performance columns refer to pages in the
combined Form 10-K filed by EIX and SCE for the fiscal year ended December
31, 2016 (10-K). The referenced pages contain additional information
about the relevant topics, but do not address annual incentive plan goals
or the scoring of the performance for purposes of this
matrix.
|
(2)
|
Score determinations are
generally made in the judgment of the Committee after assessing overall
performance against goals.
|
(3)
|
Linear interpolation between
the target of $1.274 billion and the maximum score level of $1.474 billion
was used to determine the actual score.
|
(4)
|
When the Committee established
this goal, it determined that the Actual Score for the goal would be zero
if the goal was met and could be negative if the goal was not
met.
|
2017 Proxy
Statement
|
|
29
|
Table of Contents
COMPENSATION
DISCUSSION AND ANALYSIS
2016 SCE Corporate
Performance Scoring Matrix
Goal
Category
|
|
Key Goals/Performance Contributing to Actual
Score
|
|
Actual
Score
for
Goal
(2)
|
|
Target
Score
for
Goal
Category
|
|
Potential
Score
for
Goal
Category
|
|
Actual
Score
for
Goal
Category
(2)
|
Goal
(1)
|
|
Performance
(1)
|
Financial
Performance
|
|
●
Core
earnings of $1.333 billion
|
|
●
Goal
Exceeded:
$1.376 billion
(3)
|
|
53
|
|
40
|
|
0-80
|
|
53
|
Safety
|
|
●
DART
(Days Away, Restricted, and Transfer) injury rate ≤0.61
|
|
●
Goal
Not Met:
0.80
|
|
0
|
|
10
|
|
0-20
|
|
0
|
|
●
No serious injuries to the public from system
failures
(4)
|
|
●
Goal Met:
no serious injuries to the public
|
|
0
|
|
|
|
|
|
|
|
●
No worker fatalities
(4)
|
|
●
Goal Not Met:
four worker fatalities
|
|
0
|
|
|
|
|
|
|
Operational
and
Service
Excellence
|
|
●
Affordable customer rates: controllable operations and
maintenance (O&M)
cost per
customer ≤$334; system average rate of 14.9-15.3 cents per
kilowatt-hour
|
|
●
Goal Exceeded:
controllable O&M cost per
customer of $329; system average rate of 14.8 cents per
kilowatt-hour
|
|
6
|
|
20
|
|
0-40
|
|
8
|
|
●
Improve J.D. Power Customer Satisfaction Study scores:
business customer rank ≤14; residential customer rank ≤17
|
|
●
Goal Partially Met:
business customer rank of 13;
residential customer rank of 20
|
|
3
|
|
|
|
|
|
|
|
●
Protect critical infrastructure: no significant data
breaches, control system compromises or IT infections caused by
phishing
|
|
●
Goal Met:
no significant data breaches, control
system compromises or IT infections caused by phishing
|
|
2
|
|
|
|
|
|
|
|
●
Diverse Business Enterprise spend ≥40%
|
|
●
Goal Met:
45%
|
|
2
|
|
|
|
|
|
|
|
●
Achieve capital spending targets: $3.321 billion
CPUC-jurisdictional; $0.628 billion FERC-jurisdictional
|
|
●
Goal Not Met:
$3.042 billion CPUC-jurisdictional
$0.457 billion FERC-jurisdictional
|
|
0
|
|
|
|
|
|
|
|
●
Achieve system performance and reliability goals:
SAIDI≤95.3; SAIFI≤0.85; MAIFI≤1.24
|
|
●
Goal Not Met:
SAIDI100.8; SAIFI0.91;
MAIFI1.31
|
|
0
|
|
|
|
|
|
|
|
●
No significant noncompliance
events
(4)
|
|
●
Goal Not Met:
penalty expected for Long Beach
service interruptions (10-K, pg. 8)
|
|
-5
|
|
|
|
|
|
|
Strategic
Initiatives
|
|
●
Advance grid modernization efforts: favorable outcome in
DRP (10-K, pgs. 5-6); initiate one microgid project; customer commitments
for 500 charging stations (10-K pgs. 5-6); progress on energy storage
projects (10-K, pgs. 5, 111)
|
|
●
Goal Exceeded:
favorable market reaction to DRP;
microgrid project initiated; commitments for 686 charging stations; energy
storage placed in service (40 MW) and contracted (142 MW)
|
|
13
|
|
20
|
|
0-40
|
|
21
|
|
●
Advance key regulatory proceedings: file 2018 General
Rate Case
(10-K, pg. 7); defend San
Onofre settlement agreement (10-K pgs. 7, 94-96)
|
|
●
Goal Partially Met:
filed 2018 General Rate Case;
adverse impact of CPUC ruling on settlement agreement
|
|
8
|
|
|
|
|
|
|
People
and
Culture
|
|
●
Enhance decision-making processes and encourage employee
engagement
|
|
●
Goal Met:
streamlined decision-making structure;
new X-Change program implements employee ideas
|
|
5
|
|
10
|
|
0-20
|
|
8
|
|
●
Diversify leadership pipeline above 2015 levels: ethnic
minorities 29.5% of executives and 41.4% of leadership pool; women 31.8%
of executives and 29.5% of leadership pool
|
|
●
Goal Not Met:
increased ethnic minorities to 30%
of executives and 42.1% of leadership pool; did not increase women in
leadership pipeline
|
|
3
|
|
|
|
|
|
|
Total:
|
|
|
|
|
|
|
|
100
|
|
0-200
|
|
90
|
(1)
|
The referenced 10-K pages
contain additional information about the relevant topics, but do not
address annual incentive plan goals or the scoring of the performance for
purposes of this matrix. CPUC means the California Public Utilities
Commission. FERC means the Federal Energy Regulatory Commission. SAIDI
means the System Average Interruption Duration Index. SAIFI means the
System Average Interruption Frequency Index. MAIFI means the Momentary
Average Interruption Frequency Index.
|
(2)
|
Score determinations are
generally made in the judgment of the Committee after assessing overall
performance against goals.
|
(3)
|
Linear interpolation between
the target of $1.333 billion and the maximum score level of $1.466 billion
was used to determine the actual score.
|
(4)
|
When the Committee established
this goal, it determined that the Actual Score for the goal would be zero
if the goal was met and could be negative if the goal was not
met.
|
30
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2017 Proxy
Statement
|
Table of Contents
COMPENSATION
DISCUSSION AND ANALYSIS
2016 Annual
Incentive Awards
Based on 2016
performance, the corporate performance factors for EIX and SCE were 85% and 90%
of target, respectively. These factors were determined by adding the Actual
Scores in the corporate performance scoring matrices above. Notwithstanding
strong financial performance, the corporate performance factors were below
target primarily due to below-target performance on safety and operational and
service excellence goals. The Committee did not exercise its discretion to
increase or decrease the corporate performance factor from the amount determined
by application of the scoring matrix.
The Committee determined the annual
incentive award for each NEO by multiplying the annual incentive target
percentage for the NEO by the EIX or SCE corporate performance factor and an
individual performance factor. Individual performance factors were determined by
the Committee in its discretion (subject to the limitation described below under
Impact of Other Plans), based on its assessment of each NEOs performance and
achievements for the year, and relative impact and contribution to corporate
performance compared to executives in similar roles. The following table shows
the resulting annual incentive awards to our EIX NEOs as a percentage of salary
and as a multiple of target:
EIX NEOs
(1)
|
|
Annual
Incentive
Target
as
% of Salary
(2)(3)
|
|
Corporate
Performance
Factor
(3)(4)
|
|
Individual
Performance
Factor
(3)(5)
|
|
Annual
Incentive
Award
as
% of Salary
(3)(6)
|
|
Annual
Incentive
Award
as
Multiple of
Target
(3)(6)
|
Pedro J. Pizarro
|
|
94%
|
|
0.87
|
|
1.00
|
|
81%
|
|
0.87x
|
Theodore F. Craver, Jr.
|
|
125%
|
|
0.85
|
|
1.00
|
|
106%
|
|
0.85x
|
Maria Rigatti
|
|
63%
|
|
0.89
|
|
1.13
|
|
62%
|
|
0.99x
|
W.
James Scilacci
|
|
75%
|
|
0.85
|
|
1.00
|
|
64%
|
|
0.85x
|
Adam S. Umanoff
|
|
75%
|
|
0.85
|
|
1.07
|
|
68%
|
|
0.91x
|
Kevin M. Payne
|
|
64%
|
|
0.90
|
|
1.00
|
|
58%
|
|
0.90x
|
Ronald L. Litzinger
|
|
70%
|
|
0.85
|
|
0.75
|
|
45%
|
|
0.64x
|
(1)
|
Target and actual annual
incentive awards for all EIX and SCE NEOs are shown in the Grants of
Plan-Based Awards tables and the Summary Compensation Tables,
respectively.
|
(2)
|
The amounts shown for Messrs.
Pizarro and Payne and Ms. Rigatti are the weighted average Annual
Incentive Target % for the respective NEO, with the weighting based on the
number of workdays in 2016 that the NEO served in each position for which
a different Annual Incentive Target % applied. The 2016 Annual Incentive
Target % for Mr. Pizarro as SCE President was 75%. It was adjusted to 90%
in connection with his promotion to EIX President and adjusted again to
115% in connection with his promotion to EIX CEO. The 2016 Annual
Incentive Target %s for Ms. Rigatti as SCE SVP and CFO and for Mr. Payne
as SCE SVP were 55% and 50%, respectively, and these percentages were
adjusted to 75% and 70%, respectively, in connection with Ms. Rigattis
promotion to EIX EVP and CFO and Mr. Paynes promotion to SCE
President.
|
(3)
|
The amounts shown have been
rounded to two decimal places or to the nearest whole percentage point for
purposes of the table.
|
(4)
|
The corporate performance
factor for all EIX NEOs (other than Messrs. Pizarro and Payne and Ms.
Rigatti) was 0.85. The corporate performance factor for all SCE NEOs
(other than Mr. Pizarro and Ms. Rigatti, but including Mr. Payne), was
0.90. The corporate performance factors for Mr. Pizarro and Ms. Rigatti
were a blend of EIX and SCE factors, weighted based upon the relative time
each respectively served as an EIX officer and as an SCE officer in
2016.
|
(5)
|
In determining Mr. Litzingers
individual performance factor, the Committee placed particular emphasis on
the performance of EEG given his responsibilities as President of that
business. In 2016, EEG did not meet or only partially met many of its
goals. As a result, the Committee set Mr. Litzingers individual
performance factor low relative to the other NEOs, despite solid
performance by Mr. Litzinger.
|
(6)
|
The actual annual incentive
awards to Messrs. Craver and Scilacci were prorated due to their
retirement, based on (i) the ratio of the number of workdays from January
2016 through September 30, 2016, compared to (ii) the total number of
workdays in 2016. The amounts reported for Messrs. Craver and Scilacci
reflect the actual awards, after proration.
|
Impact of Other
Plans
The EIX Committee adopted the EIX
2016 Executive Annual Incentive Program (162(m) Program) so that annual
incentive awards under the EIX Executive Incentive Compensation Plan could be
designed to qualify as deductible performance-based compensation under Section
162(m) of the Internal Revenue Code (Section 162(m)). Under the 162(m)
Program, an overall maximum annual incentive award for 2016 was established for
each participating officer as a specified percentage of an annual incentive
award pool. The aggregate award pool for the participating officers had a
maximum value equal to 3% of EIXs 2016 consolidated earnings from continuing
operations (after interest, taxes, depreciation and amortization), subject to
adjustment for the effects of any special charges to earnings (the Section
162(m) Pool). The following percentages of the pool were allocated to the NEOs
to determine maximum annual incentive awards for 2016: Mr. Pizarro, 11%; Mr.
Craver, 28%; Ms. Rigatti, 4%; Mr. Scilacci, 10%; Mr. Umanoff, 8%; Mr. Payne, 3%;
Mr. Litzinger, 8%; Mr. Nichols, 3%; Mr. Swartz, 4%; and Mr. Dietrich, 5% (each,
an Individual Section 162(m) Cap). Neither the Section 162(m) Pool nor the
Individual
Section 162(m) Caps served as a basis
for the Committees compensation decisions for NEOs. Instead, these caps served
to establish a ceiling on annual incentive awards for purposes of tax
deductions. For 2016, the total amount awarded under the 162(m) Program was less
than the Section 162(m) Pool and the actual annual incentive awarded to each
participating NEO was less than his or her Individual Section 162(m)
Cap.
Long-Term Incentive
Awards
All of our long-term incentives are
awarded as equity instruments reflecting, or valued by reference to, EIX Common
Stock. They are therefore directly linked to the value provided to EIX
shareholders. The equity awards also align executives interests with the
long-term interests of customers by enhancing executives focus on the Companys
long-term goals.
Seventy-five percent (75%) of our
long-term equity mix is performance-based: the non-qualified stock options that
comprise 50% of each NEOs long-term incentive award value; and the performance
shares that comprise 25% of the award value. We believe stock options are
performance-based because
2017 Proxy
Statement
|
|
31
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Table of Contents
COMPENSATION
DISCUSSION AND ANALYSIS
NEOs will realize value only if the
market value of EIX Common Stock appreciates. Long-term incentive awards are
made under the EIX 2007 Performance Incentive Plan.
Long-Term Incentive
Value
On February 24, 2016, the
Committee approved 2016 long-term incentive award target values for the NEOs.
Each target value was set as a percentage of base salary (the Long-Term
Incentive Target %). The Committee also approved the methodology for converting
those values into the number of stock options, performance shares, and
restricted stock units granted to each NEO on the March 1, 2016 grant date (the
Initial LTI Grants). On May 25, 2016, the Committee increased the Long-Term
Incentive Target % for Messrs. Payne and Nichols in connection with their
promotions and approved a second award for each of them that was granted on June
30, 2016. The target value of the June 30 grants was 75% of the difference
between (i) the Long-Term Incentive Target % approved on May 25, as applied to
the NEOs increased base salary for the new position, and (ii) the value of the
NEOs Initial LTI Grant. On August 24, 2016, the Committee increased the
Long-Term Incentive Target % for Messrs. Pizarro and Petmecky and Ms. Rigatti in
connection with their promotions and approved a second award for each of them
that was granted on September 30, 2016. The target value of the September 30
grants was 50% of the difference between (i) the Long-Term Incentive Target %
approved on August 24, as applied to the NEOs increased base salary for the new
position, and (ii) the value of the NEOs Initial LTI Grant. The Committee
generally applies the following proration for awards granted after the first
quarter: 75% if the grant date is in the second quarter of the year; 50% if the
grant date is in the third quarter of the year; 25% if the grant date is in the
fourth quarter of the year. The grant date value of each award is listed in the
Grants of Plan-Based Awards
tables below.
For 2016, the Committee did not change
the Long-Term Incentive Target % for the NEOs who were not promoted during the
year. For Messrs. Pizarro, Payne, and Nichols, the Long-Term Incentive Target %
approved for their second awards ranged from approximately 15% to 55% below the
market median for the new positions, with the opportunity for increases in
subsequent year(s) after evaluating their performance in their new positions.
For Ms. Rigatti and Mr. Petmecky, the Long-Term Incentive Target % approved for
their second awards was within 6% of the market median for the respective new
positions. In each case, the Committee decided the Long-Term Incentive Target %
was appropriate relative to the market median level for comparable positions,
based on the Committees overall assessment of each NEOs experience, time in
position, and individual performance, and internal equity and retention
concerns.
Stock
Options
Each stock option granted may
be exercised to purchase one share of EIX Common Stock at an exercise price
equal to the closing price of a share of EIX Common Stock on the grant date.
Options vest over a four-year period, subject to continued employment, with
one-fourth of each award vesting and becoming exercisable at the beginning of
each year.
The number of options granted to each
NEO was determined by dividing the option award value approved by the Committee
for that NEO by the grant date value of an option using a Black-
Scholes Merton valuation model based on the same assumptions
and principles used to determine the grant date fair value of options generally
for purposes of EIXs financial reporting.
Performance
Shares
Performance shares reward
performance over three years against pre-established metrics. Each performance
share awarded is a contractual right to receive one share of EIX Common Stock or
its cash equivalent if performance and continued service vesting requirements
are satisfied. The actual payout can range from zero to 200% of target
performance shares, and depends on actual performance against pre-established
metrics. The performance share awards provide for reinvested dividend
equivalents. For each dividend declared for which the ex-dividend date falls
within the performance period and after the date of grant, the NEO will be
credited with an additional number of target performance shares having a value
equal to the dividend that would have been payable on the target performance
shares subject to the award. The performance shares credited as dividend
equivalents have the same vesting and other terms and conditions as the original
performance shares and are forfeited if the underlying shares are not
earned.
A conversion formula is used to
determine the number of performance shares awarded to each NEO. For the portion
of performance shares subject to the TSR metric discussed below, the award value
approved by the Committee is divided by the grant date value of the TSR
performance shares using a Standard Monte Carlo simulation model based on the
same assumptions and principles used to determine the grant date fair value of
performance-based awards generally for purposes of EIXs financial reporting.
For the portion of performance shares subject to the earnings per share metric
discussed below, the respective award value is converted into a specific number
of earnings per share performance shares by dividing the award value by the
closing price of a share of EIX Common Stock on the grant date.
Performance shares granted before 2015
generally are paid half in EIX Common Stock and half in cash having a value
equal to the EIX Common Stock that otherwise would have been delivered. EIX
converts a portion of the awards otherwise payable in stock to cash to satisfy
minimum tax withholding or any governmental levies. NEOs may elect to defer
payment of the portion of performance shares payable in cash under the Executive
Deferred Compensation Plan. Performance shares granted in or after 2015 are
payable solely in cash.
Performance Share
Awards: TSR Metric
Two metrics are used to measure
performance share payouts, with each metric weighted 50%. One of the two
performance metrics is based on the percentile ranking of EIXs TSR for the
three-year performance period beginning January 1 in the year of grant compared
to the TSR of each company in EIXs peer group for the same period. The
following table provides the percentile ranking and corresponding payout
levels:
Payout Levels
|
|
TSR Ranking
|
|
Payout
|
Below Threshold
|
|
<25
th
Percentile
|
|
0
|
Threshold
|
|
25
th
Percentile
|
|
25% of Target
|
Target
|
|
50
th
Percentile
|
|
Target
|
Maximum
|
|
≥75
th
Percentile
|
|
200% of
Target
|
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COMPENSATION
DISCUSSION AND ANALYSIS
If EIX achieves a TSR ranking between
the 25
th
percentile and the 50
th
percentile or between the
50
th
percentile and the 75
th
percentile, the number of shares paid will be interpolated on a
straight-line basis with discrete intervals at every 5
th
percentile.
To determine performance share payouts, TSR is calculated using the difference
between (i) the average closing stock price for the stock for the 20 trading
days ending with the last NYSE trading day preceding the first day of the
performance period and (ii) the average closing stock price for the stock for
the 20 trading days ending with the last trading day of the performance period,
and assumes all dividends are reinvested on the ex-dividend date.
EIXs TSR from 2014-2016 ranked in the
90
th
percentile of the peer group under the methodology used to
calculate TSR for performance shares and resulted in a 200% of target payout for
the TSR performance shares granted in 2014.
Performance Share
Awards: EPS Metric
The second performance metric is based
on EIXs three-year average annual core earnings
3
per share (EPS),
measured against target levels. The Committee establishes the EPS target for
each calendar year in February of that year.
The performance multiple for a calendar
year is based on EIXs actual EPS performance for that year as a percentage of
the EPS target for that year, in accordance with the following table:
Performance Level
|
|
Actual EPS
as % of Target EPS
|
|
EPS Performance
Multiple
|
Below Threshold
|
|
<80%
|
|
0
|
Threshold
|
|
80%
|
|
0.25x
|
Target
|
|
100%
|
|
1.0x
|
Maximum
|
|
≥120%
|
|
2.0x
|
(3)
|
Footnote 2 in the
Compensation Summary provides additional information regarding the
determination of core earnings.
|
If EIXs EPS for a year as a percentage
of target EPS is between 80% and 100% or between 100% and 120%, the EPS
performance multiple is interpolated on a straight-line basis, with discrete
intervals at every 4
th
percentage point. The EPS performance
multiples achieved for each calendar year in the three-year performance period
are averaged, and the resulting average determines the performance share payout
as a multiple of target.
In February 2017, the Committee
certified the following EPS performance multiples for the three calendar years
in the performance period for the 2014 grant:
Year
|
|
Actual
EPS
|
|
Target
EPS
(1)
|
|
Actual EPS as %
of Target
EPS
|
|
EPS
Performance
Multiple
|
2014
|
|
$4.59
|
|
$3.70
|
|
124%
|
|
2.00x
|
2015
|
|
$4.10
|
|
$3.92
|
|
105%
|
|
1.20x
|
2016
|
|
$3.97
|
|
$3.91
|
|
101%
|
|
1.00x
|
Average of performance multiples
(actual
payout):
|
|
|
|
|
|
|
|
1.40x
|
(1)
|
In each case, the Target EPS
was set below the prior years Actual EPS due to lower projected income
tax benefits.
|
Since the average of the EPS
performance multiples for 2014, 2015, and 2016 was 1.4, EPS performance shares
granted in 2014 paid out at 140% of target.
Restricted Stock
Units
Each restricted stock unit
awarded is a contractual right to receive one share of EIX Common Stock after
the vesting requirement of three years of continued service is satisfied. The
restricted stock units for NEOs provide for reinvested dividend equivalents. For
each dividend declared for which the ex-dividend date falls within the vesting
period, the NEO will be credited with an additional number of restricted stock
units having a value equal to the dividend that would have been payable on the
number of restricted stock units subject to the award. The restricted stock
units credited as dividend equivalents have the same vesting and other terms and
conditions as the original restricted stock units and are forfeited if the
underlying units do not vest.
The restricted stock units are paid in
EIX Common Stock, except EIX converts awards to cash having a value equal to the
stock that otherwise would have been delivered to satisfy minimum tax
withholding and governmental levies. The EIX Committee may elect to pay any
restricted stock units in cash rather than shares of EIX Common Stock if and to
the extent that payment in shares would exceed the applicable share limits of
the EIX 2007 Performance Incentive Plan.
The number of restricted stock units
granted to each NEO was determined by dividing the award value approved by the
Committee for that NEO by the closing price of a share of EIX Common Stock on
the grant date. At payout, NEOs realize an increase or decrease in value
(compared to the grant date value) commensurate with the increase or decrease in
value realized by shareholders from changes in the stock price and dividends
over the three-year vesting period.
Acceleration of
Long-Term Equity
If an NEO terminates
employment after reaching age 65, or age 61 with five years of service, (i)
stock options will vest and continue to become exercisable as scheduled, (ii)
performance shares will be retained with vesting based on the applicable
performance metrics, and (iii) restricted stock units will vest and become
payable as scheduled; in each instance, as though the NEOs employment had
continued through the vesting period and subject to a pro-rated reduction if the
NEO retires within the year of grant. Messrs. Craver and Scilacci were eligible
for these accelerated vesting provisions when they retired. Mr. Swartz would
also be eligible if he retires. If an NEO dies or becomes disabled while
employed, stock options and restricted stock units will immediately vest and
become exercisable and payable, respectively, and performance shares will be
retained, with vesting based on the applicable performance metrics.
2017 Proxy
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COMPENSATION
DISCUSSION AND ANALYSIS
How We
Make Compensation Decisions
|
Role of
Compensation Committee and Executive Officers
The Committee is responsible for
reviewing and determining the compensation paid to executive-level Company
officers, including the NEOs. The Committee annually reviews all components of
compensation for our CEO and other NEOs, including base salary and annual and
long-term incentives. The Committee also reviews significant benefits, including
retirement and non-qualified deferred compensation plans.
Each February, the Committee sets the
base salary and the target and maximum potential annual and long-term incentive
award values for the current year for each officer. At that time, the Committee
also determines annual incentive awards for the prior year and performance share
payouts for the prior performance period. Base salary changes are generally
effective early March of each year.
For the February Committee meeting, the
EIX CEO provides recommendations regarding the compensation of NEOs (other than
his own compensation). Other NEOs participate in developing and reviewing
executive compensation recommendations, but do not participate in
recommendations regarding their own compensation.
The Committee evaluates the EIX CEOs
performance relative to goals and determines his compensation in executive
session without the EIX CEO present. The Committee Chair reports to the Board in
an independent director executive session regarding the compensation
determination.
For officers who are not EIX executive
officers, the Committee has authorized the EIX CEO and the EIX executive
responsible for executive compensation matters to jointly approve special
relocation, recruitment and retention awards within limits pre-approved by the
Committee. Mid-year compensation determinations for newly hired and promoted
officers that are within guidelines previously approved by the Committee do not
require additional Committee approval if the individuals are not EIX executive
officers.
Tally
Sheets
The Committee periodically
reviews tally sheets for EIX NEOs. Tally sheets provide the Committee with
information about the following components of compensation, including
compensation paid over the preceding three calendar years:
●
|
Cash compensation (base pay and
annual incentives);
|
●
|
Long-term incentive award values
(stock options, performance shares and restricted stock units);
and
|
●
|
Changes in pension values and
non-qualified plan earnings.
|
The tally sheets also provide the
amounts payable in the event of voluntary or involuntary separation from
service, death or disability, or a change in control resulting in
termination.
The Committee also reviews additional
information regarding long-term incentives, including stock program statistics
on share usage, analysis of current exercise values of prior option grants, and
a summary of current and past performance share results.
Except as otherwise noted, the
Committees executive compensation determinations are subjective and the result
of the Committees business judgment, which is informed by the experiences of
the Committee members and input from the Committees independent compensation
consultant.
Role of the
Committees Independent Compensation Consultant
The Committee retained Pay Governance
to assist in evaluating officer compensation for 2016, including the
compensation of NEOs; however, the Committee decides our officers compensation.
This assistance included helping the Committee identify industry trends and
norms for executive compensation; reviewing and identifying appropriate peer
group companies and pay surveys; and evaluating executive compensation data for
these companies.
During 2016, Pay Governance provided
the following services:
●
|
Provided a presentation on
executive compensation trends and competitive evaluation of total direct
compensation for executives;
|
●
|
Reviewed Committee agendas and
supporting materials before each meeting, and raised questions/issues with
management and the Committee Chair, as appropriate;
|
●
|
Reviewed drafts of the CD&A
for the Proxy Statement and related compensation tables;
and
|
●
|
Provided recommendations on EIX
CEO compensation to the Committee at its February meeting, without prior
review by the EIX CEO.
|
In addition, a Pay Governance representative attended Committee meetings and
communicated directly with the Committee as needed. Pay Governance did not
perform any services for the Company in 2016 unrelated to the Committees
responsibilities for our compensation programs, and all interactions by the
consultants with management were related to their work for the Committee and
conducted in accordance with the directions of the Committee or its
Chair.
The Committee retains sole authority to
hire its compensation consultant, approve its compensation, determine the nature
and scope of its services, evaluate its performance, and terminate its
engagement. Pursuant to SEC rules, the Committee assessed and determined that no
conflict of interest exists with respect to the engagement of Pay Governance as
the Committees compensation consultant.
Use of Competitive
Data
The Committee generally targets a
competitive range of +/-15% around the market median for comparable positions
for each element of total direct compensation. For 2016, the Committee used peer
group data and data from pay surveys by Towers Watson to determine the market
median.
The Committee used the companies in the Philadelphia Utility Index as
the peer group for benchmarking performance and comparing NEO compensation for
2016. The Philadelphia Utility
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COMPENSATION
DISCUSSION AND ANALYSIS
Index has been used by the Committee as
the basis for the peer group since 2005. Use of an established market index for
peer group purposes is consistent with the way investors evaluate performance
across companies within an industry.
2016 Peer Group Companies -
Philadelphia Utility Index
|
AES
Corporation
|
|
Entergy
|
Ameren
|
|
Eversource
Energy
|
American Electric Power
|
|
Exelon
|
CenterPoint
Energy
|
|
FirstEnergy
|
Consolidated Edison
|
|
NextEra Energy
|
Covanta (replaced by American
|
|
PG&E Corporation
|
Water Works during
2016)
(1)
|
|
|
Dominion Resources
|
|
Public Service Enterprise Group
|
DTE Energy
|
|
Southern
Company
|
Duke Energy
|
|
Xcel Energy
|
El Paso Electric
|
|
|
(1)
|
The peer group data used to
determine the market median for 2016 included Covanta (and not American
Water Works), since Covanta was in the Philadelphia Utility Index at the
time of the February 2016 Committee meeting. In contrast, American Water
Works (and not Covanta) was included in the peer group for determining
EIXs TSR ranking for the TSR Performance Shares granted in 2014. The
performance period for those Performance Shares ended December 31, 2016
and the terms and conditions of the awards required that the peer group
consist of the companies in the Philadelphia Utility Index at the end of
the performance period. American Water Works TSR was higher than
Covantas for the 2014-2016 performance
period.
|
EIX is just above the peer group median
in revenues and market capitalization. For the four quarters ending September
30, 2016, EIX had revenues of $11.33 billion compared to the peer group median
of $11.27 billion (ranking 10th out of the 20 companies in the peer group),
based on reported revenues. As of December 31, 2016, EIXs market capitalization
of $23.46 billion was approximately 9% above the peer group median of $21.44
billion (ranking 8th out of 20).
As part of the process of setting 2016
target total direct compensation for NEOs, Pay Governance provided the Committee
with benchmarking data from peer group proxy statements. In addition, the
Committee received base salary, target annual incentive, and target long-term
incentive grant value data from the Towers Watson 2015 Energy Services and the
Towers Watson 2015 General Industry pay surveys. The pay survey data included
compensation information from utilities, other energy companies, and companies
in other industries with comparable revenues, in order to reflect the range of
the Companys competitors for executive talent and provide a robust set of
information to make compensation decisions. The pay survey data was presented to
the Committee in aggregated form. The Committee does not consider the identities
of the individual companies in the survey data to be material for its
decision-making process, and the individual companies were not provided to the
Committee.
The components of the market data and
the relative weighting used to calculate a market median varied for each NEO
position, based on the availability of sufficient comparative data for
the
position, and were reviewed by Pay
Governance. Market median levels for 2016 were projected from available data
with input from Pay Governance.
The Committee exercises its judgment in
setting each executives compensation levels within the competitive range
described above, and may time to time vary from the competitive range, after
taking into account the executives experience, time in position, individual
performance, internal equity, retention concerns, or other factors it considers
relevant under the circumstances.
Risk
Considerations
Our executive compensation policy
directs that our total compensation structure should not encourage inappropriate
or excessive risk-taking. The Committee takes risk into consideration when
reviewing and approving executive compensation.
As specified in its charter, and with
the assistance of Pay Governance and Company management, the Committee reviewed
the Companys compensation programs for executives and for employees generally
and has concluded these programs do not create risks reasonably likely to have a
material adverse effect on the Company.
In concluding that the current
executive compensation program does not encourage inappropriate or excessive
risk-taking, the Committee noted the following characteristics that limit
risk:
●
|
Annual incentives are balanced
with long-term incentives to lessen the risk that short-term objectives
might be pursued to the detriment of long-term value
creation;
|
●
|
Goals for annual incentive
programs are varied (not focused on just one metric), include safety and
compliance goals, and are subject to Committee review and discretion as to
the ultimate award payment for executives;
|
●
|
Long-term incentive awards are
subject to a multi-year vesting schedule;
|
●
|
The ultimate value of equity
grants is not solely dependent on stock price due to the use of relative
TSR and EPS for performance shares;
|
●
|
Stock ownership guidelines
require top officers to own company stock worth two to six times their
base salary and include holding requirements;
|
●
|
Executives are prohibited from
hedging Company securities and EIX executive officers are prohibited from
pledging Company securities;
|
●
|
The Company has an incentive
compensation clawback policy that allows the Committee or the Board to
recoup incentive compensation overpayments in the event of a restatement
of Company financial statements; and
|
●
|
Executive retirement and deferred
compensation benefits are unfunded and thus depend in part on the
continued solvency of the Company.
|
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COMPENSATION
DISCUSSION AND ANALYSIS
Post-Employment and Other Benefits
|
Post-Employment
Benefits
The NEOs receive retirement benefits
under qualified and non-qualified defined-benefit and defined-contribution
retirement plans. The SCE Retirement Plan and the 401(k) Plan are both qualified
retirement plans in which the NEOs participate on substantially the same terms
as other participating employees.
Due to limitations imposed by ERISA and
the Internal Revenue Code, the benefits payable to the NEOs under the SCE
Retirement Plan and the 401(k) Plan are limited. The Executive Retirement Plan
and the Executive Deferred Compensation Plan provide for our NEOs to receive the
full amount of benefits that would be paid under the qualified plans but for
such limitations, and certain additional benefits. The Committee believes these
programs help us to attract and retain qualified executives.
For descriptions of the tax-qualified
and non-qualified defined benefit pension plans and the Executive Deferred
Compensation Plan, see the narrative to the
Pension Benefits
and
Non-Qualified Deferred Compensation
tables, respectively.
The Company also sponsors survivor and
disability benefit plans in which the NEOs were eligible to participate in
2016.
Severance and
Change in Control Benefits
Our policy regarding severance
protection for NEOs stems from its importance in retaining and recruiting
executives. Executives have attractive opportunities with other companies or are
recruited from well-compensated positions in other companies. We believe
offering one years worth of compensation and benefits if any officer is
involuntarily severed without cause provides financial security to offset the
risk of leaving another company or foregoing an opportunity with another
company. Severance benefits are not offered for resignation for good reason,
except if a change in control occurs.
The current executive compensation
plans offer additional benefits if a change in control of EIX occurs. We believe
the occurrence, or expected occurrence, of a change-in-control transaction would
create uncertainty regarding continued employment for NEOs. This uncertainty
would result from the fact that many change-in-control transactions result in
significant organizational changes, particularly at the senior executive
level.
To encourage the NEOs to remain
employed with the Company during a time when their prospects for continued
employment following the change in control would be uncertain, and to permit
them to remain focused on the Companys interests, NEOs are provided with
enhanced severance benefits if their employment is actually or constructively
terminated without cause within a defined period of time around a change in
control of EIX.
Constructive termination (or a
resignation for good reason) would include occurrences such as a material
diminution in duties or salary, or a substantial relocation.
Given that none of the NEOs has an
employment agreement that provides for fixed positions or duties, or for a fixed
base salary or annual incentive award, we believe a constructive termination
severance trigger is needed to prevent an acquirer from having an incentive to
constructively terminate an NEOs employment to avoid paying any severance
benefits. We do not provide excise tax gross-ups on change-in-control severance
benefits for any of our executives. We do not believe NEOs should be entitled to
receive their cash severance benefits merely because a change-in-control
transaction occurs. Therefore, the payment of cash severance benefits is subject
to a double-trigger where an actual or constructive termination of employment
must also occur before payment.
However, if a change in control occurs
where EIX is not the surviving corporation, and following the transaction,
outstanding equity awards would not be continued or assumed, then NEOs and other
holders of awards under our equity incentive plan would receive immediate
vesting of their outstanding equity awards as described under
Potential Payments Upon Termination or Change in
Control.
We believe it is appropriate to fully
vest equity awards in change-in-control situations where EIX is not the
surviving corporation and the equity awards are not assumed, whether or not
employment is terminated, because such a transaction ends the NEOs ability to
realize any further value with respect to the equity awards.
For detailed information on the
estimated potential payments and benefits payable to NEOs if they terminate
employment, including following a change in control of the Company, see
Potential Payments Upon Termination or Change
in Control
.
Perquisites
In general, we provide no perquisites
for our NEOs. From time to time the Company may provide a retirement gift to a
retiring executive in recognition of the executive's long and dedicated service.
In certain circumstances, the Company pays for or reimburses spousal travel
expenses where an executives spouse attends a business-related function. Given
the nature of these functions and the benefits to the Company, the Company does
not consider the payment of spousal travel expenses to be a perquisite. However,
under SEC rules, the incremental cost of such travel by an NEOs spouse is
included as All Other Compensation for the NEO for the corresponding year in the
Summary Compensation Table below.
Other
Compensation Policies and Guidelines
|
Tax-Deductibility
Section 162(m) disallows a tax
deduction by public companies for compensation over $1,000,000 paid to chief
executive officers and certain other most highly compensated executive officers
unless certain tests are met. While EIXs first priority is to
achieve its executive compensation objectives, it will
generally attempt to design and administer its executive compensation program to
preserve the deductibility of compensation payments. However, it may grant
non-deductible compensation in circumstances it considers appropriate and no
guarantees can be made that any compensation intended to constitute
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COMPENSATION
DISCUSSION AND ANALYSIS
deductible performance-based
compensation within the meaning of Section 162(m) will be deductible.
Under the EIX 2007 Performance
Incentive Plan, non-qualified stock options, performance shares and annual
incentive awards awarded to EIX NEOs are intended to constitute deductible
performance-based compensation within the meaning of Section 162(m). However,
restricted stock units are not deductible performance-based compensation within
the meaning of Section 162(m). This follows EIXs philosophy that its goal of
preserving the deductibility of compensation is secondary in importance to
achievement of its compensation objectives.
Stock Ownership
Guidelines
To underscore the importance of linking
executive and shareholder interests, the Company has stock ownership guidelines
that require SVPs and more senior officers to own EIX Common Stock or
equivalents in an amount ranging from two to six times their annual base salary.
The stock ownership guidelines for NEOs who were executive officers on December
31, 2016 are as follows:
●
|
Mr. Pizarro six times
salary
|
●
|
Ms. Rigatti and Messrs. Umanoff,
Payne, and Litzinger three times salary
|
●
|
Messrs. Petmecky, Nichols,
Swartz, and Dietrich two times salary
|
The NEOs are expected to achieve their
ownership targets within five years from the date they became subject to the
guidelines. EIX Common Stock owned outright, shares held in the 401(k) Plan, and
vested and unvested restricted stock units which do not depend on performance
measures are included in determining compliance with the guidelines. Shares that
NEOs may acquire through the exercise or payout of stock options and performance
shares are not included in determining compliance until the options or
performance shares are exercised, or paid, as the case may be, and the shares
are acquired. Based on ownership as of March 3, 2017, all of the NEOs meet their
stock ownership requirements under these guidelines.
The guidelines were amended effective
February 22, 2017 to provide that an officer subject to the guidelines may not
sell EIX Common Stock acquired pursuant to an
EIX long-term incentive award (Acquired Stock) if the officer does not meet
his or her ownership requirement under the guidelines. An officer whose
ownership satisfies the guidelines may not sell Acquired Stock to the extent the
sale would cause his or her ownership to fall below the applicable guideline
level. These transfer limitations do not apply to transfers to satisfy the
exercise price of an EIX stock option or to satisfy tax obligations with respect
to an EIX long-term incentive award. Exceptions to the guidelines may be
approved on a case-by-case basis.
Hedging and
Pledging Policy
Under the Companys Insider Trading
Policy, hedging related to Company securities, including EIX shares, is
prohibited for all directors and employees, including NEOs. In addition,
directors and EIX executive officers may not pledge Company securities as
collateral for loans.
Clawback
Policy
The Company maintains an incentive
compensation clawback policy that allows the Board or the Committee to recoup
incentive compensation if the Company restates its financial statements. The
policy applies to cash or equity-based incentive compensation to current and
former EIX and SCE NEOs and other executive officers that is paid, granted,
vested or accrued in any fiscal year within the three-year period preceding the
filing of the restatement (but only if the payment, grant, vesting or accrual
occurs after December 10, 2014). The policy allows recoupment of the difference
between the incentive compensation paid, granted, vested or accrued under the
original results and the incentive compensation that would have been paid,
granted, vested or accrued under the restated results. The policy can be
enforced by reducing or cancelling outstanding and future incentive
compensation, and by a claim for repayment.
The SEC and NYSE have been expected to
provide rules requiring public companies to adopt clawback policies to recover
incentive compensation overpayments from executive officers under certain
conditions involving accounting restatements. If and when this guidance is
received, the Committee or the Board will review the existing clawback policy
and determine whether changes are needed.
Compensation Committee Report
|
The Committee has reviewed and
discussed with management the Compensation Discussion and Analysis section of
this Proxy Statement. Based upon this review and the discussions, the Committee
recommended to the Board that the Compensation Discussion and Analysis section
be included in the Companys 2016 Annual Report and this Proxy
Statement.
Brett White, Chair
Vanessa C.L.
Chang
James T. Morris
Richard T. Schlosberg, III
Peter J.
Taylor
Compensation Committee Interlocks and Insider
Participation
|
Mr. Morris became a Committee member
when the Committees were reappointed on April 28, 2016. The other Committee
members whose names appear on the Compensation Committee Report above were
Committee members during all of 2016. Under applicable SEC rules, there were no
interlocks or insider participation on the Committee.
2017 Proxy
Statement
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Table of
Contents
EXECUTIVE COMPENSATION
Summary
Compensation Tables
|
The following tables present
information regarding compensation of the EIX and SCE NEOs for service during
2016, and for 2015 and/or 2014 for individuals who were also NEOs in those
years. The tables were prepared in accordance with SEC requirements. The total
compensation presented below does not necessarily reflect the actual total
compensation received by our NEOs. The amounts under
Stock Awards
and
Option Awards
do not
represent the actual amounts paid to or realized by our NEOs for these awards
during 2014-2016, but represent the aggregate grant date fair value of awards
granted in those years for financial reporting purposes. Likewise, the amounts
under
Change in Pension Value and
Non-Qualified Deferred Compensation Earnings
do not reflect amounts paid to or realized by our NEOs during
2014-2016.
EIX Summary Compensation Table Fiscal
Years 2014, 2015 and 2016
Name and Principal
Position
|
|
Year
|
|
Salary
(1)
($)
|
|
Bonus
($)
|
|
Stock
Awards
(2)
($)
|
|
Option
Awards
(3)
($)
|
|
Non-Equity
Incentive Plan
Compensation
(4)
($)
|
|
Change
in
Pension Value
and
Non-
Qualified
Deferred
Compensation
Earnings
(5)
($)
|
|
All
Other
Compensation
(6)
($)
|
|
Total
($)
|
(a)
|
|
(b)
|
|
(c)
|
|
(d)
|
|
(e)
|
|
(f)
|
|
(g)
|
|
(h)
|
|
(i)
|
|
(j)
|
Pedro J.
Pizarro
EIX CEO effective
9/30/16;
EIX
President effective 6/1/16;
SCE
President through
5/31/16
|
|
2016
|
|
836,782
|
|
|
|
1,553,399
|
|
1,553,133
|
|
678,402
|
|
914,498
|
|
75,382
|
|
5,611,596
|
|
2015
|
|
662,931
|
|
|
|
843,867
|
|
843,756
|
|
520,931
|
|
6,052
|
|
45,653
|
|
2,923,190
|
|
2014
|
|
151,724
|
|
|
|
585,196
|
|
585,006
|
|
148,690
|
|
762,977
|
|
7,080
|
|
2,240,673
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Theodore F. Craver,
Jr.
EIX Chairman of the Board
and
CEO through 9/30/16; also
EIX
President through 5/31/16
|
|
2016
|
|
938,697
|
|
|
|
2,968,836
|
|
2,968,751
|
|
997,366
|
|
371,205
|
|
415,051
|
|
8,659,905
|
|
2015
|
|
1,241,954
|
|
|
|
2,968,833
|
|
2,968,752
|
|
1,659,738
|
|
2,081,101
|
|
194,389
|
|
11,114,767
|
|
2014
|
|
1,200,000
|
|
|
|
2,700,105
|
|
2,700,005
|
|
2,759,952
|
|
4,708,778
|
|
163,843
|
|
14,232,683
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Maria
Rigatti
EIX EVP and CFO
effective
9/30/16; SCE SVP
and
CFO through 9/30/16
|
|
2016
|
|
392,891
|
|
|
|
362,080
|
|
361,687
|
|
244,994
|
|
364,218
|
|
29,596
|
|
1,755,466
|
|
2015
|
|
315,000
|
|
|
|
170,178
|
|
170,100
|
|
209,199
|
|
14,867
|
|
47,935
|
|
927,279
|
|
2014
|
|
136,379
|
|
|
|
141,856
|
|
141,756
|
|
110,263
|
|
342,536
|
|
29,507
|
|
902,297
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
W. James
Scilacci
EIX EVP and
CFO
through 9/30/16
|
|
2016
|
|
484,100
|
|
|
|
682,597
|
|
682,508
|
|
311,178
|
|
803,918
|
|
339,740
|
|
3,304,041
|
|
2015
|
|
620,977
|
|
|
|
656,357
|
|
656,253
|
|
461,125
|
|
974,465
|
|
62,594
|
|
3,431,771
|
|
2014
|
|
600,000
|
|
|
|
585,038
|
|
585,002
|
|
798,000
|
|
2,609,953
|
|
53,004
|
|
5,230,997
|
Adam S.
Umanoff
EIX EVP and
General Counsel
|
|
2016
|
|
548,391
|
|
|
|
589,961
|
|
589,876
|
|
375,169
|
|
241,541
|
|
46,535
|
|
2,391,473
|
|
2015
|
|
537,931
|
|
|
|
631,860
|
|
631,804
|
|
454,686
|
|
110,007
|
|
32,400
|
|
2,398,688
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Kevin M.
Payne
SCE CEO effective
6/1/16;
SCE SVP through
5/31/16
|
|
2016
|
|
421,171
|
|
|
|
323,185
|
|
322,942
|
|
243,790
|
|
470,168
|
|
23,028
|
|
1,804,284
|
|
2015
|
|
294,097
|
|
|
|
122,534
|
|
122,434
|
|
163,611
|
|
105,588
|
|
18,299
|
|
826,563
|
|
2014
|
|
274,975
|
|
|
|
113,742
|
|
113,551
|
|
199,557
|
|
693,339
|
|
15,928
|
|
1,411,092
|
Ronald L.
Litzinger
EEG President; also
EIX
EVP through 3/28/16
|
|
2016
|
|
600,000
|
|
|
|
630,031
|
|
630,003
|
|
267,750
|
|
804,297
|
|
50,490
|
|
2,982,571
|
|
2015
|
|
600,000
|
|
|
|
630,049
|
|
630,005
|
|
483,000
|
|
932,224
|
|
61,325
|
|
3,336,603
|
|
2014
|
|
597,529
|
|
|
|
585,038
|
|
585,002
|
|
798,000
|
|
2,465,664
|
|
53,241
|
|
5,084,474
|
(1)
|
The Committee increased the annual base salary rates of
Messrs. Pizarro and Payne in connection with their promotions effective
June 1, 2016 and set them at $800,000 and $500,000, respectively. The
Committee increased the annual base salary rates of Mr. Pizarro and Ms.
Rigatti in connection with their promotions effective September 30, 2016
and set them at $1,100,000 and $550,000, respectively.
|
(2)
|
Stock awards consist of
performance shares and restricted stock units granted under the 2007
Performance Incentive Plan in the year indicated. The performance share
and restricted stock unit amounts shown in the EIX Summary Compensation
Table reflect the aggregate grant date fair value of these awards computed
in accordance with FASB ASC Topic 718. For performance shares, the value
is reported as of the grant date based on the probable outcome of
performance conditions, consistent with the estimate of aggregate
compensation cost to be recognized over the service period determined as
of the grant date under FASB ASC Topic 718, excluding the effect of
estimated forfeitures. For a discussion of the assumptions and
methodologies used to calculate these amounts, see the discussion
contained in (i) Note 8 (Compensation and Benefit Plans) to EIXs
Consolidated Financial Statements, included as part of the Companys 2016
Annual Report and (ii) similar footnotes to EIXs Consolidated Financial
Statements for prior years when the awards were granted. In accordance
with the terms and conditions of the 2016 awards, 1/4 of the awards
granted in 2016 to Messrs. Craver and Scilacci terminated for no value in
connection with their respective retirements. The amounts shown in the
Summary Compensation Table are presented before taking these forfeitures
into account.
|
38
|
|
2017 Proxy
Statement
|
Table of
Contents
EXECUTIVE
COMPENSATION
The table below shows the maximum
value of performance share awards included in the EIX Summary Compensation Table
at the grant date assuming that the highest level of performance conditions will
be achieved. For the grant date fair value of each award based on the probable
outcome of the applicable performance conditions, see the Grants of Plan-Based
Awards table below. The 2014 performance share awards vested as of December 31,
2016; see the Option Exercises and Stock Vested table below for the value
realized when they vested. The performance periods for the 2015 and 2016
performance shares have not ended.
|
Name
|
|
Maximum
Performance Share
Potential as of
Grant Date
for 2016
Awards
($)
|
|
Maximum
Performance Share
Potential as of
Grant Date
for 2015
Awards
($)
|
|
Maximum
Performance Share
Potential as of
Grant Date
for 2014
Awards
($)
|
|
Pedro J. Pizarro
|
|
1,553,513
|
|
843,953
|
|
456,145
|
|
Theodore F. Craver, Jr.
|
|
2,968,868
|
|
2,968,825
|
|
2,700,165
|
|
Maria Rigatti
|
|
362,240
|
|
170,223
|
|
141,900
|
|
W.
James Scilacci
|
|
682,616
|
|
656,397
|
|
585,058
|
|
Adam S. Umanoff
|
|
590,040
|
|
631,872
|
|
|
|
Kevin M. Payne
|
|
323,286
|
|
122,597
|
|
94,000
|
|
Ronald L. Litzinger
|
|
630,052
|
|
630,034
|
|
585,058
|
(3)
|
Option awards consist of non-qualified stock options granted under
the 2007 Performance Incentive Plan in the year indicated. The option
amounts shown in the EIX Summary Compensation Table reflect the aggregate
grant date fair value of these awards computed in accordance with FASB ASC
Topic 718. For a discussion of the assumptions and methodologies used to
calculate these amounts, see the discussion of options contained in (i)
Note 8 (Compensation and Benefit Plans) to EIXs Consolidated Financial
Statements, included as part of the Companys 2016 Annual Report and (ii)
similar footnotes to EIXs Consolidated Financial Statements for prior
years when the awards were granted. In accordance with the terms and
conditions of the 2016 awards, 1/4 of the awards granted in 2016 to
Messrs. Craver and Scilacci terminated for no value in connection with
their respective retirements. The amounts shown in the Summary
Compensation Table are presented before taking these forfeitures into
account.
|
(4)
|
The annual incentive awards to Messrs. Craver and Scilacci were
prorated, based on (i) the ratio of the number of workdays from January
2016 through September 30, 2016, compared to (ii) the total number of
workdays in 2016. The reported amounts for Messrs. Craver and Scilacci are
presented after proration.
|
(5)
|
The reported amounts for 2016 include: (i) 2016 interest on
deferred compensation account balances considered under SEC rules to be at
above-market rates for Mr. Pizarro $7,325; Mr. Craver $371,205; Ms.
Rigatti $3,499; Mr. Scilacci $169,443; Mr. Umanoff $14,766; Mr. Payne
$21,115; and Mr. Litzinger $88,209; and (ii) the 2016 aggregate change in
the actuarial present value of the accumulated benefit under the SCE
Retirement Plan and the EIX Executive Retirement Plan for Mr. Pizarro
$907,173; Mr. Craver ($52,112); Ms. Rigatti $360,719; Mr. Scilacci
$634,475; Mr. Umanoff $226,775; Mr. Payne $449,053; and Mr. Litzinger
$716,088. Since Mr. Cravers pension value decreased, in accordance with
SEC rules it is not included in the amount reported for him in column (h)
of the EIX Summary Compensation Table.
|
(6)
|
Amounts reported for 2016 represent Company contributions to the
401(k) Plan and the Executive Deferred Compensation Plan for each NEO
other than Messrs. Pizarro, Scilacci, and Craver. For Mr. Pizarro, the
amount reported for 2016 includes $65,382 for Company contributions to the
401(k) Plan and the Executive Deferred Compensation Plan and $10,000 in
charitable matching gifts under the Director Matching Gift Program
described in footnote (5) to the Director Compensation Table above. For
Mr. Scilacci, the amount reported for 2016 includes $43,568 for Company
contributions to the 401(k) Plan and the Executive Deferred Compensation
Plan and $296,172 as payment for accrued and unused vacation in connection
with his retirement. For Mr. Craver, the amount reported for 2016 includes
$107,485 for Company contributions to the 401(k) Plan and the Executive
Deferred Compensation Plan, a $10,000 charitable matching gift under the
Director Matching Gift Program described in footnote (5) to the Director
Compensation Table above, $6,929 in retirement gifts, $282,452 as payment
for accrued and unused vacation in connection with his retirement, and
$8,185 in transportation expenses for Mr. Cravers spouse when she
traveled with Mr. Craver and attended business-related functions. EIX does
not consider payment of these business-related travel expenses to be a
perquisite given the benefits to the Company of her attendance at the
functions.
|
SCE
Summary Compensation Table Fiscal Years 2014, 2015 and 2016
Name and
Principal
Position
|
|
Year
|
|
Salary
(1)
($)
|
|
Bonus
($)
|
|
Stock
Awards
(2)
($)
|
|
Option
Awards
(3)
($)
|
|
Non-Equity
Incentive Plan
Compensation
($)
|
|
Change
in
Pension Value
and
Non-
Qualified
Deferred
Compensation
Earnings
(4)
($)
|
|
All
Other
Compensation
(5)
($)
|
|
Total
($)
|
(a)
|
|
(b)
|
|
(c)
|
|
(d)
|
|
(e)
|
|
(f)
|
|
(g)
|
|
(h)
|
|
(i)
|
|
(j)
|
Kevin M.
Payne
CEO effective
6/1/16;
SVP through 5/31/16
|
|
2016
|
|
421,171
|
|
|
|
323,185
|
|
322,942
|
|
243,790
|
|
470,168
|
|
23,028
|
|
1,804,284
|
|
2015
|
|
294,097
|
|
|
|
122,534
|
|
122,434
|
|
163,611
|
|
105,588
|
|
18,299
|
|
826,563
|
|
2014
|
|
274,975
|
|
|
|
113,742
|
|
113,551
|
|
199,557
|
|
693,339
|
|
15,928
|
|
1,411,092
|
Pedro J.
Pizarro
President through
5/31/16
|
|
2016
|
|
836,782
|
|
|
|
1,553,399
|
|
1,553,133
|
|
678,402
|
|
914,498
|
|
75,382
|
|
5,611,596
|
|
2015
|
|
662,931
|
|
|
|
843,867
|
|
843,756
|
|
520,931
|
|
6,052
|
|
45,653
|
|
2,923,190
|
|
2014
|
|
151,724
|
|
|
|
585,196
|
|
585,006
|
|
148,690
|
|
762,977
|
|
7,080
|
|
2,240,673
|
William M.
Petmecky, III
SVP and CFO
effective
9/30/16; Vice President
and
Treasurer through 9/30/16
|
|
2016
|
|
267,797
|
|
|
|
122,561
|
|
122,341
|
|
110,585
|
|
216,661
|
|
15,900
|
|
855,845
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
2017 Proxy
Statement
|
|
39
|
Table of
Contents
EXECUTIVE
COMPENSATION
Name and
Principal
Position
|
|
Year
|
|
Salary
(1)
($)
|
|
Bonus
($)
|
|
Stock
Awards
(2)
($)
|
|
Option
Awards
(3)
($)
|
|
Non-Equity
Incentive Plan
Compensation
($)
|
|
Change
in
Pension Value
and
Non-
Qualified
Deferred
Compensation
Earnings
(4)
($)
|
|
All
Other
Compensation
(5)
($)
|
|
Total
($)
|
(a)
|
|
(b)
|
|
(c)
|
|
(d)
|
|
(e)
|
|
(f)
|
|
(g)
|
|
(h)
|
|
(i)
|
|
(j)
|
Maria
Rigatti
SVP and CFO through
9/30/16
|
|
2016
|
|
392,891
|
|
|
|
362,080
|
|
361,687
|
|
244,994
|
|
364,218
|
|
29,596
|
|
1,755,466
|
|
2015
|
|
315,000
|
|
|
|
170,178
|
|
170,100
|
|
209,199
|
|
14,867
|
|
47,935
|
|
927,279
|
|
2014
|
|
136,379
|
|
|
|
141,856
|
|
141,756
|
|
110,263
|
|
342,536
|
|
29,507
|
|
902,297
|
Ronald O.
Nichols
President effective 6/1/16;
SVP through 5/31/16
|
|
2016
|
|
362,759
|
|
|
|
175,430
|
|
175,196
|
|
184,345
|
|
119,918
|
|
41,027
|
|
1,058,675
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Russell C.
Swartz
SVP and General Counsel
|
|
2016
|
|
362,000
|
|
|
|
162,993
|
|
162,906
|
|
202,485
|
|
147,204
|
|
22,485
|
|
1,060,073
|
|
2015
|
|
362,000
|
|
|
|
163,013
|
|
162,903
|
|
219,508
|
|
60,518
|
|
25,517
|
|
993,459
|
|
2014
|
|
362,000
|
|
|
|
163,011
|
|
162,906
|
|
320,551
|
|
871,160
|
|
24,470
|
|
1,904,098
|
Peter T.
Dietrich
SVP through 1/20/17
|
|
2016
|
|
480,000
|
|
|
|
216,124
|
|
216,007
|
|
237,600
|
|
264,864
|
|
36,700
|
|
1,451,295
|
|
2015
|
|
480,000
|
|
|
|
216,090
|
|
216,004
|
|
263,340
|
|
167,704
|
|
116,550
|
|
1,459,688
|
|
2014
|
|
480,000
|
|
|
|
237,712
|
|
237,605
|
|
388,080
|
|
370,877
|
|
116,630
|
|
1,830,904
|
(1)
|
The Committee increased the annual base salary rates of
Messrs. Pizarro, Payne, and Nichols in connection with their respective
promotions effective June 1, 2016 and set them at $800,000, $500,000, and
$400,000, respectively. The Committee increased the annual base salary
rates of Messrs. Pizarro and Petmecky and Ms. Rigatti in connection with
their respective promotions effective September 30, 2016 and set them at
$1,100,000, $300,000, and $550,000, respectively.
|
(2)
|
Stock awards consist of performance shares and
restricted stock units granted under the 2007 Performance Incentive Plan
in the year indicated. The performance share and restricted stock unit
amounts shown in the SCE Summary Compensation Table reflect the aggregate
grant date fair value of these awards computed in accordance with FASB ASC
Topic 718. For performance shares, the value is reported as of the grant
date based on the probable outcome of performance conditions, consistent
with the estimate of aggregate compensation cost to be recognized over the
service period determined as of the grant date under FASB ASC Topic 718,
excluding the effect of estimated forfeitures. For a discussion of the
assumptions and methodologies used to calculate these amounts, see the
discussion contained in (i) Note 8 (Compensation and Benefit Plans) to
EIXs Consolidated Financial Statements, included as part of the Companys
2016 Annual Report and (ii) similar footnotes to EIXs Consolidated
Financial Statements for prior years when the awards were
granted.
|
|
The table below shows the
maximum value of performance share awards included in the SCE Summary
Compensation Table at the grant date assuming that the highest level of
performance conditions will be achieved. For the grant date fair value of
each award based on the probable outcome of the applicable performance
conditions, see the Grants of Plan-Based Awards table below. The 2014
performance share awards vested as of December 31, 2016; see the Option
Exercises and Stock Vested table below for the value realized when they
vested. The performance periods for the 2015 and 2016 performance shares
have not ended.
|
|
Name
|
|
Maximum
Performance Share
Potential as of
Grant Date for
2016
Awards
($)
|
|
Maximum
Performance Share
Potential as of
Grant Date for
2015
Awards
($)
|
|
Maximum
Performance Share
Potential as of
Grant Date for
2014
Awards
($)
|
|
Kevin M. Payne
|
|
323,286
|
|
122,597
|
|
94,000
|
|
Pedro J. Pizarro
|
|
1,553,513
|
|
843,953
|
|
456,145
|
|
William M. Petmecky, III
|
|
122,581
|
|
|
|
|
|
Maria Rigatti
|
|
362,240
|
|
170,223
|
|
141,900
|
|
Ronald O. Nichols
|
|
175,443
|
|
|
|
|
|
Russell C. Swartz
|
|
163,066
|
|
163,030
|
|
163,055
|
|
Peter T. Dietrich
|
|
216,226
|
|
216,169
|
|
237,722
|
(3)
|
Option awards consist of non-qualified stock options granted under
the 2007 Performance Incentive Plan in the year indicated. The option
amounts shown in the SCE Summary Compensation Table reflect the aggregate
grant date fair value of these awards computed in accordance with FASB ASC
Topic 718. For a discussion of the assumptions and methodologies used to
calculate these amounts, see the discussion of options contained in (i)
Note 8 (Compensation and Benefit Plans) to EIXs Consolidated Financial
Statements, included as part of the Companys 2016 Annual Report and (ii)
similar footnotes to EIXs Consolidated Financial Statements for prior
years when the awards were granted.
|
(4)
|
The reported amounts for 2016 include: (i) 2016 interest on
deferred compensation account balances considered under SEC rules to be at
above-market rates for Mr. Payne $21,115; Mr. Pizarro $7,325; Mr. Petmecky
$0; Ms. Rigatti $3,499; Mr. Nichols $2,952; Mr. Swartz $69,494; and Mr.
Dietrich $31,915; and (ii) the 2016 aggregate change in the actuarial
present value of the accumulated benefit under the SCE Retirement Plan and
the EIX Executive Retirement Plan for Mr. Payne $449,053; Mr. Pizarro
$907,173; Mr. Petmecky $216,661; Ms. Rigatti $360,719; Mr. Nichols
$116,966; Mr. Swartz $77,710; and Mr. Dietrich $232,949.
|
(5)
|
Amounts reported for 2016 represent Company contributions to the
401(k) Plan and the Executive Deferred Compensation Plan for each NEO
other than Messrs. Pizarro and Nichols. For Mr. Pizarro, the amount
reported for 2016 includes $65,382 for Company contributions to the 401(k)
Plan and the Executive Deferred Compensation Plan and $10,000 in
charitable matching gifts under the Director Matching Gift Program
described in footnote (5) to the Director Compensation Table above. For
Mr. Nichols, the amount reported for 2016 includes $21,027 for Company
contributions to the 401(k) Plan and the Executive Deferred Compensation
Plan and $20,000 that was paid pursuant to the terms of his employment
offer in 2014.
|
40
|
|
2017 Proxy
Statement
|
Table of
Contents
EXECUTIVE
COMPENSATION
Grants of Plan-Based Awards
|
The following tables present
information regarding the incentive plan awards granted to the EIX and SCE NEOs
during 2016 under the EIX 2007 Performance Incentive Plan and the potential 2016
target and maximum amount of performance-based annual incentive awards payable
under the 162(m) Program or the EIX Executive Incentive Compensation Plan
(EICP). See the CD&A above for further information regarding award terms
reported in the tables below and for discussions regarding NEO stock ownership
guidelines, dividends paid on equity awards, and allocations between short-term
and long-term compensation.
EIX
Grants of Plan-Based Awards Table Fiscal Year 2016
|
|
|
|
|
|
Estimated Future Payouts
Under Non-Equity
Incentive
Plan Awards
(2)
|
|
Estimated Future Payouts
Under Equity Incentive
Plan
Awards
(3)
|
|
All Other
Stock
Awards:
Number
of Shares
of
Stock
or Units
(#)
|
|
All Other
Option
Awards:
Number
of
Securities
Underlying
Options
(#)
|
|
Exercise
or Base
Price
of
Option
Awards
($/Sh)
|
|
Grant
Date Fair
Value
of
Stock
and
Option
Awards
(4)
($)
|
Name
|
|
Grant
Date
(1)
|
|
Date of
Committee
Action
|
|
Threshold
($)
|
|
Target
($)
|
|
Maximum
($)
|
|
Threshold
Number
of Shares
of Stock
or
Units
(#)
|
|
Target
Number
of Shares
of Stock
or
Units
(#)
|
|
Maximum
Number
of Shares
of Stock
or
Units
(#)
|
(a)
|
|
(b)
|
|
|
|
(c)
|
|
(d)
|
|
(e)
|
|
(f)
|
|
(g)
|
|
(h)
|
|
(i)
|
|
(j)
|
|
(k)
|
|
(l)
|
Pedro J.
Pizarro
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Stock Options
|
|
3/1/2016
|
|
2/24/2016
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
116,785
|
|
66.88
|
|
906,252
|
TSR Performance Shares
|
|
3/1/2016
|
|
2/24/2016
|
|
|
|
|
|
|
|
687
|
|
2,749
|
|
5,498
|
|
|
|
|
|
|
|
226,600
|
EPS Performance Shares
|
|
3/1/2016
|
|
2/24/2016
|
|
|
|
|
|
|
|
847
|
|
3,388
|
|
6,776
|
|
|
|
|
|
|
|
226,589
|
Restricted Stock Units
|
|
3/1/2016
|
|
2/24/2016
|
|
|
|
|
|
|
|
|
|
|
|
|
|
6,776
|
|
|
|
|
|
453,179
|
Stock Options
|
|
9/30/2016
|
|
8/24/2016
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
75,836
|
|
72.25
|
|
646,881
|
TSR Performance Shares
|
|
9/30/2016
|
|
8/24/2016
|
|
|
|
|
|
|
|
460
|
|
1,838
|
|
3,676
|
|
|
|
|
|
|
|
161,799
|
EPS Performance Shares
|
|
9/30/2016
|
|
8/24/2016
|
|
|
|
|
|
|
|
560
|
|
2,239
|
|
4,478
|
|
|
|
|
|
|
|
161,768
|
Restricted Stock Units
|
|
9/30/2016
|
|
8/24/2016
|
|
|
|
|
|
|
|
|
|
|
|
|
|
4,477
|
|
|
|
|
|
323,463
|
Annual Incentive
|
|
|
|
|
|
N/A
|
|
784,885
|
|
1,569,770
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Theodore F. Craver,
Jr.
(5)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Stock Options
|
|
3/1/2016
|
|
2/24/2016
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
382,571
|
|
66.88
|
|
2,968,751
|
TSR Performance Shares
|
|
3/1/2016
|
|
2/24/2016
|
|
|
|
|
|
|
|
2,251
|
|
9,004
|
|
18,008
|
|
|
|
|
|
|
|
742,200
|
EPS Performance Shares
|
|
3/1/2016
|
|
2/24/2016
|
|
|
|
|
|
|
|
2,775
|
|
11,098
|
|
22,196
|
|
|
|
|
|
|
|
742,234
|
Restricted Stock Units
|
|
3/1/2016
|
|
2/24/2016
|
|
|
|
|
|
|
|
|
|
|
|
|
|
22,195
|
|
|
|
|
|
1,484,421
|
Annual Incentive
|
|
|
|
|
|
N/A
|
|
1,562,500
|
|
3,125,000
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Maria
Rigatti
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Stock Options
|
|
3/1/2016
|
|
2/24/2016
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
22,103
|
|
66.88
|
|
171,519
|
TSR Performance Shares
|
|
3/1/2016
|
|
2/24/2016
|
|
|
|
|
|
|
|
130
|
|
521
|
|
1,042
|
|
|
|
|
|
|
|
42,946
|
EPS Performance Shares
|
|
3/1/2016
|
|
2/24/2016
|
|
|
|
|
|
|
|
161
|
|
642
|
|
1,284
|
|
|
|
|
|
|
|
42,937
|
Restricted Stock Units
|
|
3/1/2016
|
|
2/24/2016
|
|
|
|
|
|
|
|
|
|
|
|
|
|
1,283
|
|
|
|
|
|
85,807
|
Stock Options
|
|
9/30/2016
|
|
8/24/2016
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
22,294
|
|
72.25
|
|
190,168
|
TSR Performance Shares
|
|
9/30/2016
|
|
8/24/2016
|
|
|
|
|
|
|
|
135
|
|
541
|
|
1,082
|
|
|
|
|
|
|
|
47,624
|
EPS Performance Shares
|
|
9/30/2016
|
|
8/24/2016
|
|
|
|
|
|
|
|
165
|
|
659
|
|
1,318
|
|
|
|
|
|
|
|
47,613
|
Restricted Stock Units
|
|
9/30/2016
|
|
8/24/2016
|
|
|
|
|
|
|
|
|
|
|
|
|
|
1,317
|
|
|
|
|
|
95,153
|
Annual Incentive
|
|
|
|
|
|
N/A
|
|
246,694
|
|
493,388
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
W. James
Scilacci
(5)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Stock Options
|
|
3/1/2016
|
|
2/24/2016
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
87,952
|
|
66.88
|
|
682,508
|
TSR Performance Shares
|
|
3/1/2016
|
|
2/24/2016
|
|
|
|
|
|
|
|
518
|
|
2,070
|
|
4,140
|
|
|
|
|
|
|
|
170,630
|
EPS Performance Shares
|
|
3/1/2016
|
|
2/24/2016
|
|
|
|
|
|
|
|
638
|
|
2,552
|
|
5,104
|
|
|
|
|
|
|
|
170,678
|
Restricted Stock Units
|
|
3/1/2016
|
|
2/24/2016
|
|
|
|
|
|
|
|
|
|
|
|
|
|
5,103
|
|
|
|
|
|
341,289
|
Annual Incentive
|
|
|
|
|
|
N/A
|
|
487,500
|
|
975,000
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Adam S.
Umanoff
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Stock Options
|
|
3/1/2016
|
|
2/24/2016
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
76,015
|
|
66.88
|
|
589,876
|
TSR Performance Shares
|
|
3/1/2016
|
|
2/24/2016
|
|
|
|
|
|
|
|
448
|
|
1,790
|
|
3,580
|
|
|
|
|
|
|
|
147,550
|
EPS Performance Shares
|
|
3/1/2016
|
|
2/24/2016
|
|
|
|
|
|
|
|
551
|
|
2,205
|
|
4,410
|
|
|
|
|
|
|
|
147,470
|
Restricted Stock Units
|
|
3/1/2016
|
|
2/24/2016
|
|
|
|
|
|
|
|
|
|
|
|
|
|
4,410
|
|
|
|
|
|
294,941
|
Annual Incentive
|
|
|
|
|
|
N/A
|
|
412,500
|
|
825,000
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
2017 Proxy
Statement
|
|
41
|
Table of
Contents
EXECUTIVE
COMPENSATION
|
|
|
|
|
|
Estimated Future Payouts
Under Non-Equity
Incentive
Plan Awards
(2)
|
|
Estimated Future Payouts
Under Equity Incentive
Plan
Awards
(3)
|
|
All Other
Stock
Awards:
Number
of Shares
of
Stock
or Units
(#)
|
|
All Other
Option
Awards:
Number
of
Securities
Underlying
Options
(#)
|
|
Exercise
or
Base
Price of
Option
Awards
($/Sh)
|
|
Grant
Date Fair
Value
of
Stock
and
Option
Awards
(4)
($)
|
Name
|
|
Grant
Date
(1)
|
|
Date of
Committee
Action
|
|
Threshold
($)
|
|
Target
($)
|
|
Maximum
($)
|
|
Threshold
Number
of Shares
of Stock
or
Units
(#)
|
|
Target
Number
of Shares
of Stock
or
Units
(#)
|
|
Maximum
Number
of Shares
of Stock
or
Units
(#)
|
(a)
|
|
(b)
|
|
|
|
(c)
|
|
(d)
|
|
(e)
|
|
(f)
|
|
(g)
|
|
(h)
|
|
(i)
|
|
(j)
|
|
(k)
|
|
(l)
|
Kevin M. Payne
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Stock
Options
|
|
3/1/2016
|
|
2/24/2016
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
16,882
|
|
66.88
|
|
131,004
|
TSR Performance Shares
|
|
3/1/2016
|
|
2/24/2016
|
|
|
|
|
|
|
|
100
|
|
398
|
|
796
|
|
|
|
|
|
|
|
32,807
|
EPS
Performance Shares
|
|
3/1/2016
|
|
2/24/2016
|
|
|
|
|
|
|
|
123
|
|
490
|
|
980
|
|
|
|
|
|
|
|
32,771
|
Restricted Stock Units
|
|
3/1/2016
|
|
2/24/2016
|
|
|
|
|
|
|
|
|
|
|
|
|
|
980
|
|
|
|
|
|
65,542
|
Stock
Options
|
|
6/30/2016
|
|
5/25/2016
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
20,795
|
|
77.67
|
|
191,938
|
TSR Performance Shares
|
|
6/30/2016
|
|
5/25/2016
|
|
|
|
|
|
|
|
124
|
|
495
|
|
990
|
|
|
|
|
|
|
|
48,065
|
EPS
Performance Shares
|
|
6/30/2016
|
|
5/25/2016
|
|
|
|
|
|
|
|
155
|
|
618
|
|
1,236
|
|
|
|
|
|
|
|
48,000
|
Restricted Stock Units
|
|
6/30/2016
|
|
5/25/2016
|
|
|
|
|
|
|
|
|
|
|
|
|
|
1,236
|
|
|
|
|
|
96,000
|
Annual
Incentive
|
|
|
|
|
|
N/A
|
|
270,878
|
|
541,756
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Ronald L. Litzinger
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Stock
Options
|
|
3/1/2016
|
|
2/24/2016
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
81,186
|
|
66.88
|
|
630,003
|
TSR Performance Shares
|
|
3/1/2016
|
|
2/24/2016
|
|
|
|
|
|
|
|
478
|
|
1,911
|
|
3,822
|
|
|
|
|
|
|
|
157,524
|
EPS
Performance Shares
|
|
3/1/2016
|
|
2/24/2016
|
|
|
|
|
|
|
|
589
|
|
2,355
|
|
4,710
|
|
|
|
|
|
|
|
157,502
|
Restricted Stock Units
|
|
3/1/2016
|
|
2/24/2016
|
|
|
|
|
|
|
|
|
|
|
|
|
|
4,710
|
|
|
|
|
|
315,005
|
Annual
Incentive
|
|
|
|
|
|
N/A
|
|
420,000
|
|
840,000
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(1)
|
Options, performance shares, and restricted stock units were
granted to each NEO on March 1, 2016 as part of the NEOs compensation
package for his or her position as of that date. Additional options,
performance shares, and restricted stock units were granted to Mr. Payne
in connection with his election as SCE CEO effective June 1, 2016 (the actual grant date of June 30, 2016
was the last New York Stock Exchange trading date for that quarter).
Additional options, performance shares, and restricted stock units were
granted to Mr. Pizarro and Ms. Rigatti in connection with their respective
elections as EIX CEO and EIX EVP and CFO, effective September 30,
2016.
|
(2)
|
Maximum amounts reported reflect 200% of the applicable annual
incentive target under the EICP and are lower than the maximum annual
incentive award payable under the 162(m) Program to participating NEOs;
NEOs who participate in the 162(m) Program receive the applicable award
under the EICP if it is less than the applicable maximum under the 162(m)
Program. For information regarding the description of performance-based
conditions under the 162(m) Program and the EICP, see Annual Incentive
Awards in the CD&A above.
|
(3)
|
Half of each NEOs 2016 performance share award value was granted
in performance shares subject to a TSR vesting metric and the other half
of the award value was granted in performance shares subject to an EPS
vesting metric. The TSR and EPS components of each NEOs award are subject
to different threshold and other vesting requirements. In order to reflect
these differences, the table above reports the TSR and EPS components of
each NEOs 2016 performance share award as separate awards. See Long-Term
Incentive Awards in the CD&A above for information regarding the
terms of the awards, the description of performance based vesting
conditions, and the criteria for determining the amounts
payable.
|
(4)
|
The amounts shown for options, performance shares, and restricted
stock units represent the grant date fair value of the awards in 2016
determined in accordance with FASB ASC Topic 718. There is no guarantee
that, if and when the awards vest, they will have this value. Assumptions
used in the calculation of these amounts are referenced in footnotes (2)
and (3) to the EIX Summary Compensation Table.
|
(5)
|
In accordance with the terms and conditions of the awards, 1/4 of
the options, performance shares, and restricted stock units awarded in
2016 to Messrs. Craver and Scilacci terminated for no value in connection
with their respective retirements. Similarly, the annual incentive awards
to Messrs. Craver and Scilacci were prorated, based on (i) the ratio of
the number of workdays from January 2016 through September 30, 2016,
compared to (ii) the total number of workdays in 2016. The amounts shown
in the Grants of Plan-Based Awards Table are presented before taking these
forfeitures and proration, respectively, into
account.
|
42
|
|
2017 Proxy
Statement
|
Table of
Contents
EXECUTIVE
COMPENSATION
SCE Grants of Plan-Based Awards Table Fiscal Year 2016
|
|
|
|
|
|
Estimated Future Payouts
Under Non-Equity
Incentive
Plan Awards
(2)
|
|
Estimated Future Payouts
Under Equity Incentive
Plan
Awards
(3)
|
|
All Other
Stock
Awards:
Number
of Shares
of
Stock
or Units
(#)
|
|
All Other
Option
Awards:
Number
of
Securities
Underlying
Options
(#)
|
|
Exercise
or
Base
Price of
Option
Awards
($/Sh)
|
|
Grant
Date Fair
Value
of
Stock
and
Option
Awards
(4)
($)
|
Name
|
|
Grant
Date
(1)
|
|
Date of
Committee
Action
|
|
Threshold
($)
|
|
Target
($)
|
|
Maximum
($)
|
|
Threshold
Number
of Shares
of Stock
or
Units
(#)
|
|
Target
Number
of Shares
of Stock
or
Units
(#)
|
|
Maximum
Number
of Shares
of Stock
or
Units
(#)
|
(a)
|
|
(b)
|
|
|
|
(c)
|
|
(d)
|
|
(e)
|
|
(f)
|
|
(g)
|
|
(h)
|
|
(i)
|
|
(j)
|
|
(k)
|
|
(l)
|
Kevin M. Payne
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Stock
Options
|
|
3/1/2016
|
|
2/24/2016
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
16,882
|
|
66.88
|
|
131,004
|
TSR Performance Shares
|
|
3/1/2016
|
|
2/24/2016
|
|
|
|
|
|
|
|
100
|
|
398
|
|
796
|
|
|
|
|
|
|
|
32,807
|
EPS
Performance Shares
|
|
3/1/2016
|
|
2/24/2016
|
|
|
|
|
|
|
|
123
|
|
490
|
|
980
|
|
|
|
|
|
|
|
32,771
|
Restricted Stock Units
|
|
3/1/2016
|
|
2/24/2016
|
|
|
|
|
|
|
|
|
|
|
|
|
|
980
|
|
|
|
|
|
65,542
|
Stock
Options
|
|
6/30/2016
|
|
5/25/2016
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
20,795
|
|
77.67
|
|
191,938
|
TSR Performance Shares
|
|
6/30/2016
|
|
5/25/2016
|
|
|
|
|
|
|
|
124
|
|
495
|
|
990
|
|
|
|
|
|
|
|
48,065
|
EPS
Performance Shares
|
|
6/30/2016
|
|
5/25/2016
|
|
|
|
|
|
|
|
155
|
|
618
|
|
1,236
|
|
|
|
|
|
|
|
48,000
|
Restricted Stock Units
|
|
6/30/2016
|
|
5/25/2016
|
|
|
|
|
|
|
|
|
|
|
|
|
|
1,236
|
|
|
|
|
|
96,000
|
Annual
Incentive
|
|
|
|
|
|
N/A
|
|
270,878
|
|
541,756
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Pedro J. Pizarro
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Stock
Options
|
|
3/1/2016
|
|
2/24/2016
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
116,785
|
|
66.88
|
|
906,252
|
TSR Performance Shares
|
|
3/1/2016
|
|
2/24/2016
|
|
|
|
|
|
|
|
687
|
|
2,749
|
|
5,498
|
|
|
|
|
|
|
|
226,600
|
EPS
Performance Shares
|
|
3/1/2016
|
|
2/24/2016
|
|
|
|
|
|
|
|
847
|
|
3,388
|
|
6,776
|
|
|
|
|
|
|
|
226,589
|
Restricted Stock Units
|
|
3/1/2016
|
|
2/24/2016
|
|
|
|
|
|
|
|
|
|
|
|
|
|
6,776
|
|
|
|
|
|
453,179
|
Stock
Options
|
|
9/30/2016
|
|
8/24/2016
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
75,836
|
|
72.25
|
|
646,881
|
TSR Performance Shares
|
|
9/30/2016
|
|
8/24/2016
|
|
|
|
|
|
|
|
460
|
|
1,838
|
|
3,676
|
|
|
|
|
|
|
|
161,799
|
EPS
Performance Shares
|
|
9/30/2016
|
|
8/24/2016
|
|
|
|
|
|
|
|
560
|
|
2,239
|
|
4,478
|
|
|
|
|
|
|
|
161,768
|
Restricted Stock Units
|
|
9/30/2016
|
|
8/24/2016
|
|
|
|
|
|
|
|
|
|
|
|
|
|
4,477
|
|
|
|
|
|
323,463
|
Annual
Incentive
|
|
|
|
|
|
N/A
|
|
784,885
|
|
1,569,770
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
William M. Petmecky,
III
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Stock
Options
|
|
3/1/2016
|
|
2/24/2016
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
12,502
|
|
66.88
|
|
97,016
|
TSR Performance Shares
|
|
3/1/2016
|
|
2/24/2016
|
|
|
|
|
|
|
|
74
|
|
295
|
|
590
|
|
|
|
|
|
|
|
24,317
|
EPS
Performance Shares
|
|
3/1/2016
|
|
2/24/2016
|
|
|
|
|
|
|
|
91
|
|
363
|
|
726
|
|
|
|
|
|
|
|
24,277
|
Restricted Stock Units
|
|
3/1/2016
|
|
2/24/2016
|
|
|
|
|
|
|
|
|
|
|
|
|
|
726
|
|
|
|
|
|
48,555
|
Stock
Options
|
|
9/30/2016
|
|
8/24/2016
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
2,969
|
|
72.25
|
|
25,326
|
TSR Performance Shares
|
|
9/30/2016
|
|
8/24/2016
|
|
|
|
|
|
|
|
18
|
|
72
|
|
144
|
|
|
|
|
|
|
|
6,338
|
EPS
Performance Shares
|
|
9/30/2016
|
|
8/24/2016
|
|
|
|
|
|
|
|
22
|
|
88
|
|
176
|
|
|
|
|
|
|
|
6,358
|
Restricted Stock Units
|
|
9/30/2016
|
|
8/24/2016
|
|
|
|
|
|
|
|
|
|
|
|
|
|
176
|
|
|
|
|
|
12,716
|
Annual
Incentive
|
|
|
|
|
|
|
|
119,294
|
|
238,588
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Maria Rigatti
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Stock
Options
|
|
3/1/2016
|
|
2/24/2016
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
22,103
|
|
66.88
|
|
171,519
|
TSR Performance Shares
|
|
3/1/2016
|
|
2/24/2016
|
|
|
|
|
|
|
|
130
|
|
521
|
|
1,042
|
|
|
|
|
|
|
|
42,946
|
EPS
Performance Shares
|
|
3/1/2016
|
|
2/24/2016
|
|
|
|
|
|
|
|
161
|
|
642
|
|
1,284
|
|
|
|
|
|
|
|
42,937
|
Restricted Stock Units
|
|
3/1/2016
|
|
2/24/2016
|
|
|
|
|
|
|
|
|
|
|
|
|
|
1,283
|
|
|
|
|
|
85,807
|
Stock
Options
|
|
9/30/2016
|
|
8/24/2016
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
22,294
|
|
72.25
|
|
190,168
|
TSR Performance Shares
|
|
9/30/2016
|
|
8/24/2016
|
|
|
|
|
|
|
|
135
|
|
541
|
|
1,082
|
|
|
|
|
|
|
|
47,624
|
EPS
Performance Shares
|
|
9/30/2016
|
|
8/24/2016
|
|
|
|
|
|
|
|
165
|
|
659
|
|
1,318
|
|
|
|
|
|
|
|
47,613
|
Restricted Stock Units
|
|
9/30/2016
|
|
8/24/2016
|
|
|
|
|
|
|
|
|
|
|
|
|
|
1,317
|
|
|
|
|
|
95,153
|
Annual
Incentive
|
|
|
|
|
|
N/A
|
|
246,694
|
|
493,388
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Ronald O. Nichols
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Stock
Options
|
|
3/1/2016
|
|
2/24/2016
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
12,984
|
|
66.88
|
|
100,756
|
TSR Performance Shares
|
|
3/1/2016
|
|
2/24/2016
|
|
|
|
|
|
|
|
77
|
|
306
|
|
612
|
|
|
|
|
|
|
|
25,224
|
EPS
Performance Shares
|
|
3/1/2016
|
|
2/24/2016
|
|
|
|
|
|
|
|
94
|
|
377
|
|
754
|
|
|
|
|
|
|
|
25,214
|
Restricted Stock Units
|
|
3/1/2016
|
|
2/24/2016
|
|
|
|
|
|
|
|
|
|
|
|
|
|
754
|
|
|
|
|
|
50,428
|
Stock
Options
|
|
6/30/2016
|
|
5/25/2016
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
8,065
|
|
77.67
|
|
74,440
|
TSR Performance Shares
|
|
6/30/2016
|
|
5/25/2016
|
|
|
|
|
|
|
|
48
|
|
192
|
|
384
|
|
|
|
|
|
|
|
18,643
|
EPS
Performance Shares
|
|
6/30/2016
|
|
5/25/2016
|
|
|
|
|
|
|
|
60
|
|
240
|
|
480
|
|
|
|
|
|
|
|
18,641
|
Restricted Stock Units
|
|
6/30/2016
|
|
5/25/2016
|
|
|
|
|
|
|
|
|
|
|
|
|
|
480
|
|
|
|
|
|
37,282
|
Annual
Incentive
|
|
|
|
|
|
N/A
|
|
204,828
|
|
409,655
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
2017 Proxy
Statement
|
|
43
|
Table of
Contents
EXECUTIVE
COMPENSATION
|
|
|
|
|
|
Estimated Future Payouts
Under Non-Equity
Incentive
Plan Awards
(2)
|
|
Estimated Future Payouts
Under Equity Incentive
Plan
Awards
(3)
|
|
All Other
Stock
Awards:
Number
of Shares
of
Stock
or Units
(#)
|
|
All Other
Option
Awards:
Number
of
Securities
Underlying
Options
(#)
|
|
Exercise
or Base
Price
of
Option
Awards
($/Sh)
|
|
Grant
Date Fair
Value
of
Stock
and
Option
Awards
(4)
($)
|
Name
|
|
Grant
Date
(1)
|
|
Date of
Committee
Action
|
|
Threshold
($)
|
|
Target
($)
|
|
Maximum
($)
|
|
Threshold
Number
of Shares
of Stock
or
Units
(#)
|
|
Target
Number
of Shares
of Stock
or
Units
(#)
|
|
Maximum
Number
of Shares
of Stock
or
Units
(#)
|
(a)
|
|
(b)
|
|
|
|
(c)
|
|
(d)
|
|
(e)
|
|
(f)
|
|
(g)
|
|
(h)
|
|
(i)
|
|
(j)
|
|
(k)
|
|
(l)
|
Russell C.
Swartz
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Stock Options
|
|
3/1/2016
|
|
2/24/2016
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
20,993
|
|
66.88
|
|
162,906
|
TSR Performance Shares
|
|
3/1/2016
|
|
2/24/2016
|
|
|
|
|
|
|
|
124
|
|
495
|
|
990
|
|
|
|
|
|
|
|
40,803
|
EPS Performance Shares
|
|
3/1/2016
|
|
2/24/2016
|
|
|
|
|
|
|
|
152
|
|
609
|
|
1,218
|
|
|
|
|
|
|
|
40,730
|
Restricted Stock Units
|
|
3/1/2016
|
|
2/24/2016
|
|
|
|
|
|
|
|
|
|
|
|
|
|
1,218
|
|
|
|
|
|
81,460
|
Annual Incentive
|
|
|
|
|
|
N/A
|
|
199,100
|
|
398,200
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Peter T.
Dietrich
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Stock Options
|
|
3/1/2016
|
|
2/24/2016
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
27,836
|
|
66.88
|
|
216,007
|
TSR Performance Shares
|
|
3/1/2016
|
|
2/24/2016
|
|
|
|
|
|
|
|
164
|
|
656
|
|
1,312
|
|
|
|
|
|
|
|
54,074
|
EPS Performance Shares
|
|
3/1/2016
|
|
2/24/2016
|
|
|
|
|
|
|
|
202
|
|
808
|
|
1,616
|
|
|
|
|
|
|
|
54,039
|
Restricted Stock Units
|
|
3/1/2016
|
|
2/24/2016
|
|
|
|
|
|
|
|
|
|
|
|
|
|
1,615
|
|
|
|
|
|
108,011
|
Annual Incentive
|
|
|
|
|
|
N/A
|
|
264,000
|
|
528,000
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(1)
|
Options, performance shares, and restricted stock units were
granted to each NEO on March 1, 2016 as part of the NEOs compensation
package for his or her position as of that date. Additional options,
performance shares, and restricted stock units were granted to Messrs.
Payne and Nichols in connection with their respective elections as CEO and
President effective June 1, 2016 (the actual grant date of June 30, 2016
was the last New York Stock Exchange trading date for that quarter).
Additional options, performance shares, and restricted stock units were
granted to Messrs. Pizarro and Petmecky and Ms. Rigatti in connection with
their respective elections as EIX CEO, SCE SVP and CFO, and EIX EVP and
CFO, effective September 30, 2016.
|
(2)
|
Maximum amounts reported reflect 200% of the applicable annual
incentive target under the EICP and are lower than the maximum annual
incentive award payable under the 162(m) Program to participating NEOs;
NEOs who participate in the 162(m) Program receive the applicable award
under the EICP if it is less than the applicable maximum under the 162(m)
Program. For information regarding the description of performance-based
conditions under the 162(m) Program and the EICP, see Annual Incentive
Awards in the CD&A above.
|
(3)
|
Half of each NEOs 2016 performance share award value was granted
in performance shares subject to a TSR vesting metric and the other half
of the award value was granted in performance shares subject to an EPS
vesting metric. The TSR and EPS components of each NEOs award are subject
to different threshold and other vesting requirements. In order to reflect
these differences, the table above reports the TSR and EPS components of
each NEOs 2016 performance share award as separate awards. See Long-Term
Incentive Awards in the CD&A above for information regarding the
terms of the awards, the description of performance based vesting
conditions, and the criteria for determining the amounts
payable.
|
(4)
|
The amounts shown for options, performance shares, and restricted
stock units represent the grant date fair value of the awards in 2016
determined in accordance with FASB ASC Topic 718. There is no guarantee
that, if and when the awards vest, they will have this value. Assumptions
used in the calculation of these amounts are referenced in footnotes (2)
and (3) to the SCE Summary Compensation
Table.
|
44
|
|
2017 Proxy
Statement
|
Table of
Contents
EXECUTIVE
COMPENSATION
Outstanding Equity Awards
at Fiscal Year-End
|
The following
tables present information regarding the outstanding equity awards held by the
EIX and SCE NEOs at the end of 2016. Outstanding equity awards consist of
non-qualified stock options, performance shares, and restricted stock units.
Column (d) Equity Incentive Plan Awards has been omitted in accordance with
SEC rules because no such awards were outstanding at the end of 2016.
EIX Outstanding Equity Awards Table Fiscal Year-End
2016
|
|
|
|
Option
Awards
|
|
Stock
Awards
|
Name
|
|
Grant
Date
|
|
Number
of
Securities
Underlying
Unexercised
Options
Exercisable
(1)
(#)
|
|
Number
of
Securities
Underlying
Unexercised
Options
Unexercisable
(1)
(#)
|
|
Option
Exercise
Price
($)
|
|
Option
Expiration
Date
(1)
|
|
Number
of Shares
or Units
of
Stock
That
Have
Not
Vested
(2)
(#)
|
|
Market
Value of
Shares
or Units
of
Stock
That
Have
Not
Vested
(2)(3)
($)
|
|
Equity
Incentive
Plan
Awards:
Number
of
Unearned
Shares,
Units
or Other
Rights That
Have
Not
Vested
(4)
(#)
|
|
Equity
Incentive
Plan
Awards:
Market
or
Payout
Value of
Unearned
Shares,
Units
or
Other
Rights That
Have
Not
Vested
(3)(4)
($)
|
(a)
|
|
|
|
(b)
|
|
(c)
|
|
(e)
|
|
(f)
|
|
(g)
|
|
(h)
|
|
(i)
|
|
(j)
|
Pedro J. Pizarro
|
|
12/31/2014
|
|
32,940
|
|
32,939
|
|
65.48
|
|
1/2/2024
|
|
4,724
|
|
340,099
|
|
|
|
|
|
|
3/2/2015
|
|
27,902
|
|
83,706
|
|
63.72
|
|
1/2/2025
|
|
7,001
|
|
503,983
|
|
12,665
|
|
911,753
|
|
|
3/1/2016
|
|
|
|
116,785
|
|
66.88
|
|
1/2/2026
|
|
6,962
|
|
501,162
|
|
12,610
|
|
907,801
|
|
|
9/30/2016
|
|
|
|
75,836
|
|
72.25
|
|
1/2/2026
|
|
4,511
|
|
324,757
|
|
8,216
|
|
591,482
|
Theodore F.
|
|
3/3/2009
|
|
295,614
|
|
|
|
24.84
|
|
1/2/2019
|
|
|
|
|
|
|
|
|
Craver, Jr.
|
|
3/3/2010
|
|
461,129
|
|
|
|
33.30
|
|
1/2/2020
|
|
|
|
|
|
|
|
|
|
|
3/3/2011
|
|
440,361
|
|
|
|
37.96
|
|
1/4/2021
|
|
|
|
|
|
|
|
|
|
|
3/5/2012
|
|
511,495
|
|
|
|
43.10
|
|
1/3/2022
|
|
|
|
|
|
|
|
|
|
|
3/1/2013
|
|
503,732
|
|
|
|
48.48
|
|
1/3/2023
|
|
|
|
|
|
|
|
|
|
|
3/3/2014
|
|
189,076
|
|
189,076
|
|
51.90
|
|
1/2/2024
|
|
|
|
|
|
|
|
|
|
|
3/2/2015
|
|
98,173
|
|
294,519
|
|
63.72
|
|
1/2/2025
|
|
|
|
|
|
44,553
|
|
3,207,347
|
|
|
3/1/2016
|
|
|
|
286,929
|
|
66.88
|
|
1/2/2026
|
|
|
|
|
|
30,979
|
|
2,230,155
|
Maria Rigatti
|
|
9/30/2014
|
|
9,194
|
|
9,192
|
|
55.92
|
|
1/2/2024
|
|
1,349
|
|
97,109
|
|
|
|
|
|
|
3/2/2015
|
|
5,625
|
|
16,875
|
|
63.72
|
|
1/2/2025
|
|
1,412
|
|
101,619
|
|
2,555
|
|
183,903
|
|
|
3/1/2016
|
|
|
|
22,103
|
|
66.88
|
|
1/2/2026
|
|
1,318
|
|
94,892
|
|
2,390
|
|
172,034
|
|
|
9/30/2016
|
|
|
|
22,294
|
|
72.25
|
|
1/2/2026
|
|
1,327
|
|
95,534
|
|
2,418
|
|
174,093
|
W. James
Scilacci
|
|
3/3/2010
|
|
57,597
|
|
|
|
33.30
|
|
1/2/2020
|
|
|
|
|
|
|
|
|
|
|
3/3/2011
|
|
96,986
|
|
|
|
37.96
|
|
1/4/2021
|
|
|
|
|
|
|
|
|
|
|
3/5/2012
|
|
108,334
|
|
|
|
43.10
|
|
1/3/2022
|
|
|
|
|
|
|
|
|
|
|
3/1/2013
|
|
109,142
|
|
|
|
48.48
|
|
1/3/2023
|
|
|
|
|
|
|
|
|
|
|
3/3/2014
|
|
40,968
|
|
40,965
|
|
51.90
|
|
1/2/2024
|
|
|
|
|
|
|
|
|
|
|
3/2/2015
|
|
21,702
|
|
65,104
|
|
63.72
|
|
1/2/2025
|
|
|
|
|
|
9,850
|
|
709,124
|
|
|
3/1/2016
|
|
|
|
65,964
|
|
66.88
|
|
1/2/2026
|
|
|
|
|
|
7,123
|
|
512,774
|
Adam S. Umanoff
|
|
3/2/2015
|
|
20,893
|
|
62,679
|
|
63.72
|
|
1/2/2025
|
|
5,242
|
|
377,398
|
|
9,482
|
|
682,635
|
|
|
3/1/2016
|
|
|
|
76,015
|
|
66.88
|
|
1/2/2026
|
|
4,531
|
|
326,169
|
|
8,209
|
|
590,951
|
Kevin M. Payne
|
|
3/1/2013
|
|
13,790
|
|
|
|
48.48
|
|
1/3/2023
|
|
|
|
|
|
|
|
|
|
|
3/3/2014
|
|
6,580
|
|
6,579
|
|
51.90
|
|
1/2/2024
|
|
982
|
|
70,720
|
|
|
|
|
|
|
3/31/2014
|
|
1,160
|
|
1,159
|
|
56.61
|
|
1/2/2024
|
|
187
|
|
13,493
|
|
|
|
|
|
|
3/2/2015
|
|
4,049
|
|
12,146
|
|
63.72
|
|
1/2/2025
|
|
1,016
|
|
73,150
|
|
1,840
|
|
132,447
|
|
|
3/1/2016
|
|
|
|
16,882
|
|
66.88
|
|
1/2/2026
|
|
1,007
|
|
72,482
|
|
1,825
|
|
131,355
|
|
|
6/30/2016
|
|
|
|
20,795
|
|
77.67
|
|
1/2/2026
|
|
1,254
|
|
90,242
|
|
2,258
|
|
162,523
|
2017 Proxy
Statement
|
|
45
|
Table of
Contents
EXECUTIVE
COMPENSATION
|
|
|
|
Option
Awards
|
|
Stock
Awards
|
Name
|
|
Grant
Date
|
|
Number
of
Securities
Underlying
Unexercised
Options
Exercisable
(1)
(#)
|
|
Number
of
Securities
Underlying
Unexercised
Options
Unexercisable
(1)
(#)
|
|
Option
Exercise
Price
($)
|
|
Option
Expiration
Date
(1)
|
|
Number
of Shares
or Units
of
Stock
That
Have
Not
Vested
(2)
(#)
|
|
Market
Value of
Shares
or Units
of
Stock
That
Have
Not
Vested
(2)(3)
($)
|
|
Equity
Incentive
Plan
Awards:
Number
of
Unearned
Shares,
Units
or Other
Rights That
Have
Not
Vested
(4)
(#)
|
|
Equity
Incentive
Plan
Awards:
Market
or
Payout
Value of
Unearned
Shares,
Units
or
Other
Rights That
Have
Not
Vested
(3)(4)
($)
|
(a)
|
|
|
|
(b)
|
|
(c)
|
|
(e)
|
|
(f)
|
|
(g)
|
|
(h)
|
|
(i)
|
|
(j)
|
Ronald L.
Litzinger
|
|
3/3/2008
|
|
28,242
|
|
|
|
49.95
|
|
1/2/2018
|
|
|
|
|
|
|
|
|
|
|
6/30/2008
|
|
32,932
|
|
|
|
51.38
|
|
1/2/2018
|
|
|
|
|
|
|
|
|
|
|
3/3/2009
|
|
76,385
|
|
|
|
24.84
|
|
1/2/2019
|
|
|
|
|
|
|
|
|
|
|
3/3/2010
|
|
70,526
|
|
|
|
33.30
|
|
1/2/2020
|
|
|
|
|
|
|
|
|
|
|
3/3/2011
|
|
90,045
|
|
|
|
37.96
|
|
1/4/2021
|
|
|
|
|
|
|
|
|
|
|
3/5/2012
|
|
96,959
|
|
|
|
43.10
|
|
1/3/2022
|
|
|
|
|
|
|
|
|
|
|
3/1/2013
|
|
106,414
|
|
|
|
48.48
|
|
1/3/2023
|
|
|
|
|
|
|
|
|
|
|
3/3/2014
|
|
40,968
|
|
40,965
|
|
51.90
|
|
1/2/2024
|
|
6,111
|
|
439,933
|
|
|
|
|
|
|
3/2/2015
|
|
20,834
|
|
62,500
|
|
63.72
|
|
1/2/2025
|
|
5,228
|
|
376,332
|
|
9,455
|
|
680,655
|
|
|
3/1/2016
|
|
|
|
81,186
|
|
66.88
|
|
1/2/2026
|
|
4,839
|
|
348,358
|
|
8,766
|
|
631,038
|
(1)
|
Subject to each NEOs continued employment, each unvested stock
option grant becomes vested in equal annual installments over a four-year
vesting period, with the first installment vesting on January 2 in the
year following the year in which the grant occurs and the following three
installments vesting on the next three anniversaries of that date (if
January 2 falls on a holiday or weekend, then vesting occurs either on the
preceding business day or the next business day on which the New York
Stock Exchange is open, depending on the terms applicable to the grant).
In accordance with the terms and conditions of the awards, 1/4 of the
options granted on March 1, 2016 to Messrs. Craver and Scilacci terminated
for no value in connection with their respective retirements. With respect
to these options, the amounts shown in the Outstanding Equity Awards Table
are presented after taking these forfeitures into
account.
|
(2)
|
Subject to each NEOs continued employment, restricted stock units
become vested and payable on January 2 at the end of a three-year vesting
period beginning with the year in which the grant occurs (if January 2
falls on a holiday or weekend, then vesting occurs on the preceding
business day on which the New York Stock Exchange is
open).
|
(3)
|
The values shown in columns (h) and (j) of the table are determined
by multiplying the number of shares or units reported in column (g) or
(i), respectively, by the closing price of EIX Common Stock on December
30, 2016.
|
(4)
|
Subject to each NEOs continued employment, approximately half of
each NEOs 2015 and 2016 performance share grants become earned and vested
based on EIXs comparative TSR during the relevant three-year performance
period (TSR Performance Shares) and the remainder become earned and
vested based on EIXs average annual core earnings per share measured
against target levels for the three calendar years in the relevant
performance period (EPS Performance Shares). The number of performance
shares included for each NEO in column (i) of the table above is the
maximum number of shares that may become earned (including shares added by
reinvestment of dividend equivalents) for the 2015 and 2016 grants. In
accordance with the terms and conditions of the stock awards, 1/4 of the
performance shares granted on March 1, 2016 to Messrs. Craver and Scilacci
terminated for no value in connection with their respective retirements.
With respect to these 2016 performance share grants, the amounts shown in
the Outstanding Equity Awards Table are presented after taking these
forfeitures into account.
|
46
|
|
2017 Proxy
Statement
|
Table of Contents
EXECUTIVE
COMPENSATION
SCE Outstanding Equity
Awards Table Fiscal Year-End 2016
|
|
Option
Awards
|
|
Stock
Awards
|
Name
|
Grant
Date
|
Number
of
Securities
Underlying
Unexercised
Options
Exercisable
(1)
(#)
|
Number
of
Securities
Underlying
Unexercised
Options
Unexercisable
(1)
(#)
|
Option
Exercise
Price
($)
|
Option
Expiration
Date
(1)
|
|
Number
of Shares
or
Units
of Stock
That
Have
Not
Vested
(2)
(#)
|
Market
Value of
Shares
or
Units of
Stock
That
Have
Not
Vested
(2)(3)
($)
|
Equity
Incentive
Plan
Awards:
Number
of
Unearned
Shares,
Units
or Other
Rights That
Have
Not
Vested
(4)
(#)
|
Equity
Incentive
Plan Awards:
Market or
Payout Value
of
Unearned
Shares, Units
or Other
Rights That
Have
Not
Vested
(3)(4)
($)
|
(a)
|
|
(b)
|
(c)
|
(e)
|
(f)
|
|
(g)
|
(h)
|
(i)
|
(j)
|
Kevin M.
|
3/1/2013
|
13,790
|
|
48.48
|
1/3/2023
|
|
|
|
|
|
Payne
|
3/3/2014
|
6,580
|
6,579
|
51.90
|
1/2/2024
|
|
982
|
70,720
|
|
|
|
3/31/2014
|
1,160
|
1,159
|
56.61
|
1/2/2024
|
|
187
|
13,493
|
|
|
|
3/2/2015
|
4,049
|
12,146
|
63.72
|
1/2/2025
|
|
1,016
|
73,150
|
1,840
|
132,447
|
|
3/1/2016
|
|
16,882
|
66.88
|
1/2/2026
|
|
1,007
|
72,482
|
1,825
|
131,355
|
|
6/30/2016
|
|
20,795
|
77.67
|
1/2/2026
|
|
1,254
|
90,242
|
2,258
|
162,523
|
Pedro J.
|
12/31/2014
|
32,940
|
32,939
|
65.48
|
1/2/2024
|
|
4,724
|
340,099
|
|
|
Pizarro
|
3/2/2015
|
27,902
|
83,706
|
63.72
|
1/2/2025
|
|
7,001
|
503,983
|
12,665
|
911,753
|
|
3/1/2016
|
|
116,785
|
66.88
|
1/2/2026
|
|
6,962
|
501,162
|
12,610
|
907,801
|
|
9/30/2016
|
|
75,836
|
72.25
|
1/2/2026
|
|
4,511
|
324,757
|
8,216
|
591,482
|
William M.
|
9/30/2014
|
|
4,408
|
55.92
|
1/2/2024
|
|
647
|
46,563
|
|
|
Petmecky, III
|
3/2/2015
|
|
8,093
|
63.72
|
1/2/2025
|
|
678
|
48,792
|
1,227
|
88,298
|
|
3/1/2016
|
|
12,502
|
66.88
|
1/2/2026
|
|
746
|
53,696
|
1,352
|
97,333
|
|
9/30/2016
|
|
2,969
|
72.25
|
1/2/2026
|
|
177
|
12,767
|
322
|
23,212
|
Maria Rigatti
|
9/30/2014
|
9,194
|
9,192
|
55.92
|
1/2/2024
|
|
1,349
|
97,109
|
|
|
|
3/2/2015
|
5,625
|
16,875
|
63.72
|
1/2/2025
|
|
1,412
|
101,619
|
2,555
|
183,903
|
|
3/1/2016
|
|
22,103
|
66.88
|
1/2/2026
|
|
1,318
|
94,892
|
2,390
|
172,034
|
|
9/30/2016
|
|
22,294
|
72.25
|
1/2/2026
|
|
1,327
|
95,534
|
2,418
|
174,093
|
Ronald O.
|
6/30/2014
|
5,858
|
5,858
|
58.11
|
1/2/2024
|
|
928
|
66,821
|
|
|
Nichols
|
3/2/2015
|
3,499
|
10,495
|
63.72
|
1/2/2025
|
|
879
|
63,255
|
1,590
|
114,483
|
|
3/1/2016
|
|
12,984
|
66.88
|
1/2/2026
|
|
775
|
55,767
|
1,403
|
101,031
|
|
6/30/2016
|
|
8,065
|
77.67
|
1/2/2026
|
|
487
|
35,045
|
876
|
63,082
|
Russell C.
|
3/3/2008
|
9,965
|
|
49.95
|
1/2/2018
|
|
|
|
|
|
Swartz
|
3/3/2009
|
28,624
|
|
24.84
|
1/2/2019
|
|
|
|
|
|
|
3/3/2010
|
20,590
|
|
33.30
|
1/2/2020
|
|
|
|
|
|
|
3/3/2011
|
27,785
|
|
37.96
|
1/4/2021
|
|
|
|
|
|
|
3/5/2012
|
31,745
|
|
43.10
|
1/3/2022
|
|
|
|
|
|
|
3/1/2013
|
30,392
|
|
48.48
|
1/3/2023
|
|
|
|
|
|
|
3/3/2014
|
11,408
|
11,408
|
51.90
|
1/2/2024
|
|
|
|
|
|
|
3/2/2015
|
5,387
|
16,161
|
63.72
|
1/2/2025
|
|
|
|
2,447
|
176,139
|
|
3/1/2016
|
|
20,993
|
66.88
|
1/2/2026
|
|
|
|
2,268
|
163,307
|
Peter T.
|
3/1/2013
|
22,389
|
|
48.48
|
1/3/2023
|
|
|
|
|
|
Dietrich
|
3/3/2014
|
16,640
|
16,638
|
51.90
|
1/2/2024
|
|
2,483
|
178,752
|
|
|
|
3/2/2015
|
7,143
|
21,429
|
63.72
|
1/2/2025
|
|
1,792
|
129,022
|
3,244
|
233,533
|
|
3/1/2016
|
|
27,836
|
66.88
|
1/2/2026
|
|
1,659
|
119,447
|
3,008
|
216,559
|
(1)
|
Subject to each NEOs
continued employment, each unvested stock option grant becomes vested in
equal annual installments over a four-year vesting period, with the first
installment vesting on January 2 in the year following the year in which
the grant occurs and the following three installments vesting on the next
three anniversaries of that date (if January 2 falls on a holiday or
weekend, then vesting occurs either on the preceding business day or the
next business day on which the New York Stock Exchange is open, depending
on the terms applicable to the grant).
|
(2)
|
Subject to each NEOs
continued employment, restricted stock units become vested and payable on
January 2 at the end of a three-year vesting period beginning with the
year in which the grant occurs (if January 2 falls on a holiday or
weekend, then vesting occurs on the preceding business day on which the
New York Stock Exchange is open).
|
(3)
|
The values shown in columns
(h) and (j) of the table are determined by multiplying the number of
shares or units reported in column (g) or (i), respectively, by the
closing price of EIX Common Stock on December 30,
2016.
|
2017 Proxy
Statement
|
|
47
|
Table of Contents
EXECUTIVE
COMPENSATION
(4)
|
Subject to each NEOs
continued employment, approximately half of each NEOs 2015 and 2016
performance share grants become earned and vested based on EIXs
comparative TSR during the relevant three-year performance period and the
remainder become earned and vested based on EIXs average annual core
earnings per share measured against target levels for the three calendar
years in the relevant performance period. The number of performance shares
included for each NEO in column (i) of the table above is the maximum
number of shares that may become earned (including shares added by
reinvestment of dividend equivalents) for the 2015 and 2016
grants.
|
Option Exercises and Stock
Vested
|
The following tables present information
regarding the exercise of stock options by the EIX and SCE NEOs and vesting of
stock awards during 2016. The stock awards listed in the following tables
represent the value realized on the vesting of restricted stock units during
2016, and the value realized on the vesting of 2014 performance share awards
payable for the 2014-2016 performance period. The value realized on the vesting
of the 2014 performance share awards reflects a payout of approximately 170% of
the target number of shares. This above-target payout was due to EIXs TSR
ranking in the 90
th
percentile of its peer group for the performance
period and EIXs EPS exceeding its target for each year in the performance
period by approximately 24%, 5% and 1%, respectively.
EIX Option Exercises
and Stock Vested Table Fiscal Year 2016
|
Option
Awards
|
|
Stock
Awards
|
Name
|
Number of
Shares
Acquired
on Exercise
(1)
(#)
|
Value Realized
on
Exercise
(1)(2)
($)
|
|
Number of
Shares
Acquired
on Vesting
(3)
(#)
|
Value Realized
on
Vesting
(3)(4)
($)
|
(a)
|
(b)
|
(c)
|
|
(d)
|
(e)
|
Pedro J. Pizarro
|
|
|
|
6,297
|
453,334
|
Theodore F. Craver, Jr.
|
698,781
|
22,726,402
|
|
57,412
|
4,133,078
|
Maria Rigatti
|
|
|
|
1,859
|
133,839
|
W.
James Scilacci
|
159,970
|
4,519,124
|
|
24,223
|
1,743,783
|
Adam S. Umanoff
|
|
|
|
|
|
Kevin M. Payne
|
10,924
|
293,831
|
|
1,655
|
119,153
|
Ronald L. Litzinger
|
101,524
|
3,421,952
|
|
8,734
|
628,770
|
(1)
|
All of the stock options
exercised by Mr. Litzinger were exercised pursuant to his Rule 10b5-1
trading plan.
|
(2)
|
The value realized on exercise
of stock options equals the difference between (i) the market price of EIX
Common Stock on the exercise date and (ii) the exercise price of those
options, multiplied by the number of shares as to which the options were
exercised.
|
(3)
|
In accordance with the terms
and conditions of the restricted stock units granted in 2016 to Messrs.
Craver and Scilacci, 1/4 of those restricted stock units terminated for no
value in connection with their respective retirements. The amounts shown
in the Option Exercises and Stock Vested Table are presented after taking
these forfeitures into account. For Mr. Craver, the amounts reported in
columns (d) and (e) above include 17,102 restricted stock units awarded in
2016, with a December 31, 2016 value (including dividend equivalents) of
$1,231,178, that are considered vested for this purpose as a result of the
retirement vesting provisions applicable to the award. For Mr. Scilacci,
the amounts reported in columns (d) and (e) above include restricted stock
units awarded in 2014, 2015, and 2016 (a total of 15,488 units with a
December 31, 2016 value, including dividend equivalents, of $1,115,013),
that are considered vested for this purpose as a result of the retirement
vesting provisions applicable to the award. In accordance with applicable
SEC rules, the units discussed in this footnote are also reported as 2016
registrant contributions in the EIX Non-Qualified Deferred Compensation
Table below because, while the units vested or are considered to have
vested for certain purposes, they were not yet payable on December 31,
2016.
|
(4)
|
With the exception of the
restricted stock units discussed in footnote (3) above (which are valued
in accordance with footnote (3)), the value for stock awards equals the
market price of EIX Common Stock on the vesting date (December 31, 2016
for performance shares granted in 2014) multiplied by the number of shares
or units, as applicable, that vested.
|
48
|
|
2017 Proxy
Statement
|
Table of Contents
EXECUTIVE
COMPENSATION
SCE Option
Exercises and Stock Vested Table Fiscal Year 2016
|
Option
Awards
|
|
Stock
Awards
|
Name
|
Number of
Shares
Acquired
on Exercise
(#)
|
Value Realized
on
Exercise
(1)
($)
|
|
Number of
Shares
Acquired
on Vesting
(2)
(#)
|
Value Realized
on
Vesting
(2)(3)
($)
|
(a)
|
(b)
|
(c)
|
|
(d)
|
(e)
|
Kevin M. Payne
|
10,924
|
293,831
|
|
1,655
|
119,153
|
Pedro J. Pizarro
|
|
|
|
6,297
|
453,334
|
William M. Petmecky, III
|
7,108
|
69,938
|
|
891
|
64,147
|
Maria Rigatti
|
|
|
|
1,859
|
133,839
|
Ronald O. Nichols
|
|
|
|
1,297
|
93,380
|
Russell C. Swartz
|
6,659
|
160,834
|
|
3,686
|
265,324
|
Peter T. Dietrich
|
42,039
|
1,133,297
|
|
3,549
|
255,482
|
(1)
|
The value realized on exercise
of stock options equals the difference between (i) the market price of EIX
Common Stock on the exercise date and (ii) the exercise price of those
options, multiplied by the number of shares as to which the options were
exercised.
|
(2)
|
For Mr. Swartz, the amounts
reported in columns (d) and (e) above include 1,251 restricted stock units
awarded in 2016 with a December 31, 2016 value (including dividend
equivalents) of $90,085 that are considered vested for this purpose
because the units would have been payable in accordance with the
retirement provisions of the award had he elected to retire on December
31, 2016. In accordance with applicable SEC rules, the units discussed in
this footnote are also reported as 2016 registrant contributions in the
SCE Non-Qualified Deferred Compensation Table below because, while the
units vested or are considered to have vested for certain purposes, they
were not yet payable on December 31, 2016.
|
(3)
|
With the exception of the
restricted stock units discussed in footnote (2) above (which are valued
in accordance with footnote (2)), the value for stock awards equals the
market price of EIX Common Stock on the vesting date (December 31, 2016
for performance shares granted in 2014) multiplied by the number of shares
or units, as applicable, that vested.
|
The following tables present information
regarding the present value of accumulated benefits that may become payable to,
and payments made to, the EIX and SCE NEOs under the Companys qualified and
non-qualified defined-benefit pension plans.
EIX Pension Benefits
Table
Name
|
Plan Name
|
Number of Years
Credited
Service
(1)
(#)
|
Present Value of
Accumulated
Benefit
(2)
($)
|
Payments
During
Last
Fiscal Year
($)
|
(a)
|
(b)
|
(c)
|
(d)
|
(e)
|
Pedro J. Pizarro
|
SCE Retirement
Plan
|
18
|
431,430
|
|
|
Executive Retirement Plan
|
|
3,015,481
|
|
Theodore F. Craver, Jr.
|
SCE Retirement Plan
|
20
|
620,203
|
|
|
Executive Retirement Plan
|
|
19,376,135
|
1,294,085
|
Maria Rigatti
|
SCE Retirement
Plan
|
18
|
688,959
|
|
|
Executive Retirement Plan
|
|
852,200
|
|
W. James Scilacci
|
SCE Retirement Plan
|
33
|
1,184,453
|
|
|
Executive Retirement Plan
|
|
10,237,105
|
|
Adam S. Umanoff
|
SCE Retirement
Plan
|
2
|
36,477
|
|
|
Executive Retirement Plan
|
|
298,228
|
|
Kevin M. Payne
|
SCE Retirement Plan
|
30
|
816,364
|
|
|
Executive Retirement Plan
|
|
2,002,343
|
|
Ronald L.
Litzinger
|
SCE Retirement
Plan
|
31
|
1,172,447
|
|
|
Executive Retirement Plan
|
|
8,241,487
|
|
(1)
|
The years of credited service
are presented as of December 31, 2016. For Mr. Pizarro and Ms. Rigatti,
the amount reported reflects all years of credited service with EIX and
its affiliates, including service prior to their respective current period
of employment.
|
(2)
|
The amounts reported in column
(d) for Present Value of Accumulated Benefit (PVAB) are actual
retirement benefits for those who retired during 2016 or actuarial
estimates of the present value of each NEOs accumulated benefits under
the SCE Retirement Plan and the Executive Retirement Plan, using the same
measurement date (December 31, 2016) and material assumptions used for
year-end 2016 financial reporting purposes, except that it is assumed for
purposes of the amounts reported in column (d) that each NEO retires at
the later of December 31, 2016, 5 years of service, or age 61, the
youngest age at which an unreduced retirement benefit is available from
the SCE Retirement Plan and the Executive Retirement Plan. The following
assumptions were used to calculate the PVAB: (i) discount rate of 3.94%
for the SCE Retirement Plan and 4.18% for the Executive Retirement Plan;
(ii) the RP-2014 White Collar Mortality Table projected with the MP-2016
projection table; (iii) 80% of benefits under the SCE Retirement Plan are
paid in the form of a lump sum and 20% are paid in the form of a single
life annuity, while 100% of benefits under the Executive Retirement Plan
are paid in the form of a lump sum; and (iv) lump sum amounts are
determined using an interest rate of 6.00% for the SCE Retirement Plan and
4.18% for the Executive Retirement
Plan.
|
2017 Proxy
Statement
|
|
49
|
Table of Contents
EXECUTIVE
COMPENSATION
SCE Pension Benefits
Table
Name
|
Plan Name
|
Number of Years
Credited
Service
(1)
(#)
|
Present Value
of
Accumulated Benefit
(2)
($)
|
Payments
During
Last
Fiscal Year
($)
|
(a)
|
(b)
|
(c)
|
(d)
|
(e)
|
Kevin M. Payne
|
SCE Retirement
Plan
|
30
|
816,364
|
|
|
Executive Retirement Plan
|
|
2,002,343
|
|
Pedro J. Pizarro
|
SCE Retirement Plan
|
18
|
431,430
|
|
|
Executive Retirement Plan
|
|
3,015,481
|
|
William M. Petmecky,
III
|
SCE Retirement
Plan
|
22
|
442,510
|
|
|
Executive Retirement Plan
|
|
454,088
|
|
Maria Rigatti
|
SCE Retirement Plan
|
18
|
688,959
|
|
|
Executive Retirement Plan
|
|
852,200
|
|
Ronald O.
Nichols
|
SCE Retirement
Plan
|
3
|
61,092
|
|
|
Executive Retirement Plan
|
|
195,149
|
|
Russell C. Swartz
|
SCE Retirement Plan
|
24
|
868,327
|
|
|
Executive Retirement Plan
|
|
2,758,634
|
|
Peter T.
Dietrich
|
SCE Retirement
Plan
|
6
|
126,690
|
|
|
Executive Retirement Plan
|
|
925,776
|
|
(1)
|
The years of credited service
are presented as of December 31, 2016. For Mr. Pizarro and Ms. Rigatti,
the amounts reported reflect all years of credited service with EIX and
its affiliates, including service prior to their respective current period
of employment.
|
(2)
|
See footnote (2) under EIX
Pension Benefits Table above for information regarding the PVAB
calculation.
|
SCE Retirement
Plan
The SCE Retirement Plan is a
non-contributory defined-benefit pension plan subject to ERISA. The Retirement
Plan was a traditional final average pay plan with a Social Security offset
until April 1, 1999, when for most participants a transition to cash balance
features was adopted. Employees hired on or after December 31, 2017 will not be
eligible to participate in the plan.
Form of Payment
Eligible participants may elect a lump sum, life annuity, joint and survivor
annuity (if married), or a contingent annuity. For married participants, payment
in a joint and 50% survivor annuity is the automatic form of benefit, absent an
alternative election. The Company pays the cost of the spousal survivor annuity
benefit. For single participants, the single life annuity option is the
automatic payment method. Participants can choose to start receiving benefit
payments after separation from service or can effectively defer commencement of
payments until age 70-1/2.
Cash Balance
Benefits
Eligible employees have cash balance accounts that earn
interest monthly based on the third segment rate of a corporate bond yield curve
specified by the Internal Revenue Service for the month of August preceding the
plan year.
Eligible employees of participating
companies also earn a monthly pay credit ranging from 3% to 9% of base pay,
depending on the number of age plus service points the participant has earned.
The pay credits are received for each month the participant has an hour of
service with the participating company. An additional credit of $150 per month
is applied each month to the cash balance account of each participant who is
eligible to receive a pay credit for that month.
Grandfathered
Benefits
Eligible participants (at
least age 50 or with 60 combined age and service points as of March 31, 1999)
are considered grandfathered and accrue benefits under prior plan
formulas.
Upon separation, the grandfathered
participant will be eligible to receive the greater of the benefit calculated
under the prior plan formulas (offset by any profit sharing account balance in
the 401(k) Plan) or the value of the new cash balance account.
An actuarial reduction of the normal age
65 benefit applies if a grandfathered participant either terminates prior to age
55 and commences benefits prior to age 65, or retires and commences benefits
after attaining age 55 but prior to age 61. The pension benefit commencing at
age 55 for an employee terminating prior to age 55 with at least five years of
service is 53.6% of the normal age 65 benefit, while the pension benefit
commencing at age 55 for an employee retiring at age 55 with at least five years
of service is 77% of the normal age 65 benefit. Lesser early retirement
reductions are applied for benefit commencement after age 55 but prior to age
61.
An unreduced early retirement benefit is
available at age 61 and above. No NEO is eligible for grandfathered benefits
under the SCE Retirement Plan.
Vesting
Full vesting
occurs after three years of service, upon attainment of age 65, or upon death
while employed.
Executive Retirement
Plan
The Executive Retirement Plan is an
unfunded benefit equalization plan permitted by ERISA designed to allow NEOs and
other employees to receive the full amount of benefits that would be paid under
the SCE Retirement Plan but for limitations under ERISA and the Internal Revenue
Code, and certain additional benefits. As part of the 2008 Internal Revenue Code
Section 409A amendments, the Executive Retirement Plan was separated into two
plan documents. The grandfathered plan document applies to benefits accrued,
determined and vested prior to January 1, 2005, while the 2008 plan document
applies to benefits accrued, determined or vested on or after January 1,
2005.
50
|
|
2017 Proxy
Statement
|
Table of Contents
EXECUTIVE
COMPENSATION
Eligibility and
Benefit Formula
Company executives,
including the NEOs, are eligible to participate in the Executive Retirement
Plan. The normal age 65 benefit is calculated using the following
formula:
1.75% x Total Compensation up to 30 years
+ 1% x Total Compensation for each year over 30 years.
Total Compensation is the NEOs base
salary and annual incentive award earned in the 36 consecutive months when the
total of these payments was the highest (the 36 months need not be consecutive
for those grandfathered in the provisions effective prior to 2008).
Because they were senior executives prior
to January 1, 2006, Messrs. Craver, Scilacci, Pizarro, and Litzinger receive an
additional service percentage of 0.75% per year for the first ten years of
service, which results in an additional 7.5% upon completion of ten years of
service.
The actual benefit payable is reduced and
offset by (i) all amounts payable under the SCE Retirement Plan described above,
(ii) up to 40% of the executives primary Social Security benefits and (iii) the
value of 401(k) Plan accounts derived from the Companys profit sharing
contributions, if any.
Effective January 1, 2018, a participants
benefit under the plan will be the lesser of: (i) the lump sum value of the
final average pay benefit determined as described above; or (ii) the sum of (x)
the lump sum value of the final average pay benefit determined as described
above but substituting 1% for 1.75% and 0.5% for 1% in the benefit formula
described above as to years of service accrued after 2017 and (y) the amount in
the participants Executive Retirement Account. For an individual who first
participates in the plan on or after January 1, 2018, the participants benefit
under the plan will be the amount in the participants Executive Retirement
Account. The aggregate retirement benefit under the plan (i.e., totaling the
final average pay benefit, if applicable, and the Executive Retirement Account
benefit) is expected to be reduced for most executives and will be unchanged for
the rest. Executive Retirement Accounts will be established under the plan
effective January 1, 2018, and will be credited annually in an amount equal to
12% of the sum of (i) the differential between the participants actual salary
that year and the participants earnings taken into account for purposes of
determining deferrals under the Edison 401(k) Savings Plan that year, and (ii)
the participants annual incentive for that year. Interest will be credited on
Executive Retirement Account balances at a rate based on the average monthly
Moodys Corporate Bond Yield for Baa Public Utility Bonds over a sixty-month
period preceding September 1 of the prior year. EIX established this interest
rate for all plan participants, and may change the interest rate on a
prospective basis.
If an NEO becomes entitled to severance
benefits under the EIX 2008 Executive Severance Plan (the Severance Plan), or
any successor plan, the NEO will receive additional service and age credits to
calculate the NEOs benefit under the Executive Retirement Plan as described
under
Potential Payments Upon Termination or
Change in Control
below. Effective, January
1, 2018, enhanced contributions to the participants Executive Retirement
Account will also be made in such circumstances equal to (i) a multiplier (one
two, or three, determined based on the multiplier
used to determine the participants severance benefits under the Severance
Plan), times (ii) 12% of the sum of the participants target annual incentive
amount plus the differential between the participants annual salary rate and
annualized earnings taken into account for purposes of determining deferrals
under the Edison 401(k) Savings Plan (determined immediately prior the
participants separation from service). These severance benefit protections are
provided to attract and retain qualified executives.
Vesting
Benefits vest
under the Executive Retirement Plan after five years of service, upon death or
disability, or upon becoming eligible for severance benefits under the Severance
Plan.
Payment
Benefits that
become payable under the grandfathered plan document are generally payable as
follows. Upon a vested participants retirement at or after age 55 or death, the
normal form of benefit is a life annuity, paid monthly, with a 50% spousal
survivor benefit following the death of the participant (if the surviving spouse
is more than five years younger than the participant, the spousal benefit will
be reduced to an amount less than 50% of the pre-death benefit to account for
the longer projected payout period). The Company pays the cost of this spousal
survivor benefit. A contingent annuity benefit for a survivor other than a
spouse is also available, but without company subsidy.
Participants may elect to receive an
alternative form of benefit, such as a lump-sum payment or monthly payments over
60 or 120 months. If the participants employment terminates for any reason
other than death, retirement, permanent and total disability, or involuntary
termination not for cause, vested benefits will be paid after the participant
attains age 55 in an annuity only. If a participants employment is terminated
for cause, all benefits will be forfeited.
Benefits that become payable under the
2008 plan document are generally payable as follows. Participants have
sub-accounts for each annual accrual for which the following forms of payment
may be elected: single lump-sum; two to fifteen annual installments; monthly
installments for 60, 120, or 180 months; a life annuity with a 50% spousal
survivor benefit following the participants death; or a contingent annuity.
Participants may elect to have their designated form of payment triggered by
their retirement, death, disability or other separation from service; however,
payment will not occur before a participant reaches age 55 other than in the
case of death or disability.
Payments triggered by retirement, death,
disability or other separation from service may begin upon the applicable
triggering event, the later of the applicable triggering event and a specific
month and year, or a specified number of months and/or years, following the
applicable triggering event; however, payments generally may not begin later
than the participants 75
th
birthday unless the participant is still
employed. Payments may be delayed or accelerated under the 2008 plan document if
permitted or required under Section 409A of the Internal Revenue Code; if
payments are delayed after the later of the applicable triggering event or age
55, interest is credited at a rate equal to that credited to cash balance
accounts under the SCE Retirement
2017 Proxy
Statement
|
|
51
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Table of Contents
EXECUTIVE
COMPENSATION
Plan described above or, as to any
valuation date after 2017, at a rate based on the average monthly Moodys
Corporate Bond Yield for Baa Public Utility Bonds over a sixty-month period
preceding September 1 of the prior year. EIX established this interest rate for
all plan participants, and may change the interest rate on a prospective
basis.
The annuity options available under the
2008 plan document have the same features as the annuity options available under
the grandfathered plan document. Account balances payable in installments under
the 2008 plan document earn interest at a rate of interest determined in the
same manner as described in the preceding paragraph for delayed
payments.
The benefit formula includes benefit
reductions for termination prior to age 55, or early retirement after attaining
age 55 but prior to age 61, similar to the formula for the SCE Retirement Plan
discussed above. If an NEO terminates prior to age 55 but with a total of 68
years of age and service, the benefit formula includes a special early
retirement benefit reduction based on the SCE Retirement Plan formula for early
retirement. An unreduced early retirement benefit is available at age 61 and
above. Mr. Scilacci will receive unreduced early retirement benefits in
connection with his retirement. As of December 31, 2016, Messrs. Pizarro and
Petmecky and Ms. Rigatti were eligible for special early retirement
benefits.
Non-Qualified Deferred
Compensation
|
The following tables present information
regarding the contributions to and earnings on the EIX and SCE NEOs deferred
compensation balances during 2016, and the total deferred amounts for the NEOs
at the end of 2016. All deferrals are under the Executive Deferred Compensation
Plan (EDCP), except for (1) restricted stock units (RSUs) that vested or are
considered to have been vested for certain purposes at the end of 2016 as a
result of the retirement vesting provisions applicable to the RSUs, and (2)
deferrals by Mr. Litzinger under the Affiliate Option Deferred Compensation Plan
(AODCP).
EIX Non-Qualified
Deferred Compensation Table Fiscal Year 2016
Name
(1)
|
|
Executive
Contributions in
Last Fiscal
Year
(2)
($)
|
Registrant
Contributions in
Last Fiscal
Year
(2)
($)
|
Aggregate
Earnings in
Last Fiscal
Year
(3)
($)
|
Aggregate
Withdrawals/
Distributions
(4)
($)
|
Aggregate
Balance at Last
Fiscal Year
End
($)
|
(a)
|
|
(b)
|
(c)
|
(d)
|
(e)
|
(f)
|
Pedro J. Pizarro
|
EDCP
|
310,219
|
49,482
|
19,509
|
|
507,813
|
Theodore F.
Craver, Jr.
|
EDCP
|
157,277
|
91,585
|
988,578
|
175,638
|
20,495,440
|
|
RSUs
|
|
1,231,178
|
758,633
|
1,790,977
|
5,033,869
|
Maria Rigatti
|
EDCP
|
131,520
|
13,696
|
9,319
|
4,792
|
245,236
|
W. James
Scilacci
|
EDCP
|
945,011
|
27,668
|
451,254
|
27,649
|
9,541,561
|
|
RSUs
|
|
1,115,013
|
|
|
1,115,013
|
Adam S. Umanoff
|
EDCP
|
709,756
|
30,635
|
39,324
|
|
1,051,495
|
Kevin M. Payne
|
EDCP
|
24,716
|
14,073
|
56,233
|
|
1,187,081
|
Ronald L. Litzinger
(5)
|
EDCP
|
596,976
|
34,590
|
224,060
|
|
4,758,615
|
|
AODCP
|
|
|
22,070
|
|
605,987
|
(1)
|
The balances shown represent
compensation already reportable in the Summary Compensation Tables in this
and prior Proxy Statements, except for the portion of interest not
considered above-market under SEC rules. Although the contributions to the
EDCP and AODCP reflect compensation that was earned, the officers chose
not to have the compensation paid, but instead deferred it, essentially
lending to the Company as unsecured general creditors, in return for
interest paid at a rate commensurate with or less than EIXs cost of
capital.
|
(2)
|
The amounts reported as
executive and registrant contributions in 2016 also are included as
compensation in the appropriate columns of the EIX Summary Compensation
Table above, except with respect to certain restricted stock units awarded
to Messrs. Craver and Scilacci. Three-fourths of the restricted stock
units awarded to Messrs. Craver and Scilacci in 2016 and all of the
restricted stock units awarded to Mr. Scilacci in 2014 and 2015 are
reported as registrant contributions in this table because they became
vested for certain purposes during 2016 as a result of the retirement
vesting provisions applicable to these awards, but they had not yet become
payable. The restricted stock units awarded to Messrs. Craver and Scilacci
are reported as of their grant date fair value in the Stock Awards column
of the EIX Summary Compensation Table above, while in this EIX
Non-Qualified Deferred Compensation Table the units that became vested for
certain purposes during 2016 as a result of the retirement vesting
provisions applicable to these awards are reported as registrant
contributions based on the closing price of EIX Common Stock on December
31, 2016 and include dividend equivalents accrued as of December 31,
2016.
|
(3)
|
Only the portion of earnings
on deferred compensation that is considered to be at above-market rates
under SEC rules is included as compensation in column (h) of the EIX
Summary Compensation Table above.
|
(4)
|
For Mr. Craver, the amount
reported as aggregate withdrawals/distributions reflects 2016 payments in
EIX Common Stock for restricted stock units awarded in 2013 that are
considered to have become vested for certain purposes but not payable
prior to 2016 as a result of the retirement vesting provisions applicable
to the award; the amount reported is based on the closing price of EIX
Common Stock on December 31, 2015.
|
(5)
|
Mr. Litzinger is a participant
in both the EDCP and the AODCP, which is a predecessor plan under which
the proceeds from the exchange of EME options for cash awards in 2000
could be deferred. Accounts under this plan are credited with interest at
a rate based on 120% of the 120-month average of the 10-year Treasury Note
yield as of October 15 of the prior year. Payment terms are substantially
the same as those under the EDCP grandfathered plan document described
below.
|
52
|
|
2017 Proxy
Statement
|
Table of Contents
EXECUTIVE
COMPENSATION
SCE
Non-Qualified Deferred Compensation Table Fiscal Year 2016
Name
(1)
|
|
|
Executive
Contributions in
Last
Fiscal
Year
(2)
($)
|
Registrant
Contributions in
Last Fiscal
Year
(2)
($)
|
Aggregate
Earnings in
Last Fiscal
Year
(3)
($)
|
Aggregate
Withdrawals/
Distributions
(4)
($)
|
Aggregate
Balance at Last
Fiscal Year
End
($)
|
(a)
|
|
|
(b)
|
(c)
|
(d)
|
(e)
|
(f)
|
Kevin M. Payne
|
EDCP
|
|
24,716
|
14,073
|
56,233
|
|
1,187,081
|
Pedro J. Pizarro
|
EDCP
|
|
310,219
|
49,482
|
19,509
|
|
507,813
|
William M. Petmecky, III
|
EDCP
|
|
|
|
|
|
|
Maria Rigatti
|
EDCP
|
|
131,520
|
13,696
|
9,319
|
4,792
|
245,236
|
Ronald O. Nichols
|
EDCP
|
|
85444
|
5,127
|
7,862
|
|
179,423
|
Russell C.
Swartz
|
EDCP
|
|
166,279
|
6,585
|
185,073
|
|
3,871,787
|
|
RSUs
|
|
|
90,085
|
43,860
|
108,113
|
309,929
|
Peter T. Dietrich
|
EDCP
|
|
44,600
|
20,800
|
84,993
|
|
1,798,742
|
(1)
|
The balances shown represent
compensation already reportable in the Summary Compensation Tables in this
and prior Proxy Statements, except for the portion of interest not
considered above-market under SEC rules. Although the contributions to the
EDCP reflect compensation that was earned, the officers chose not to have
the compensation paid, but instead deferred it, essentially lending to the
Company as unsecured general creditors, in return for interest paid at a
rate commensurate with or less than EIXs cost of
capital.
|
(2)
|
The amounts reported as
executive and registrant contributions in 2016 also are included as
compensation in the appropriate columns of the SCE Summary Compensation
Table above, except that the restricted stock units awarded in 2016 to Mr.
Swartz are reported as of their grant date fair value in the Stock Awards
column of the SCE Summary Compensation Table above, while in this SCE
Non-Qualified Deferred Compensation Table they are reported as registrant
contributions based on the closing price of EIX Common Stock on December
31, 2016 and include dividend equivalents accrued as of December 31, 2016.
The restricted stock units awarded to Mr. Swartz in 2016 (and the dividend
equivalents thereon) are considered to have become vested for certain
purposes during 2016 as a result of the retirement vesting provisions
applicable to these awards. In accordance with applicable SEC rules, these
units are reflected in this table because, while the units are considered
to have been vested for certain purposes at the end of 2016, they had not
yet become payable.
|
(3)
|
Only the portion of earnings
on deferred compensation that is considered to be at above-market rates
under SEC rules is included as compensation in column (h) of the SCE
Summary Compensation Table above.
|
(4)
|
For Mr. Swartz, the amount
reported as aggregate withdrawals/distributions reflects 2016 payments in
EIX Common Stock for restricted stock units awarded in 2013 that are
considered to have become vested for certain purposes but not payable
prior to 2016 as a result of the retirement vesting provisions applicable
to the award; the amount reported is based on the closing price of EIX
Common Stock on December 31, 2015.
|
Executive Deferred
Compensation Plan
As part of the 2008 Internal Revenue Code
Section 409A amendments, the Executive Deferred Compensation Plan was separated
into two plan documents. The grandfathered plan document applies to deferrals
earned, determined and vested prior to January 1, 2005, while the 2008 plan
document applies to deferrals earned, determined or vested on or after January
1, 2005.
Contributions
Each NEO
may elect to defer up to 75% of base salary. Each NEO may also elect to defer up
to 100% (less the tax withholding due in connection with the deferral) of: any
annual incentive award earned; certain special retention, recognition, or other
special cash awards; the cash portion of performance share payouts; and certain
other qualifying equity awards (other than stock options). The Company makes a
matching contribution of up to 3% of each NEOs annual incentive award, 6% of
the portion of each NEOs base salary that is deferred and up to 6% of the
portion, if any, of non-deferred salary that exceeds 401(k) Plan Internal
Revenue Code limits. NEOs vest in their matching contributions and earnings
thereon after five years of service, upon death or disability, or a separation
from service where the NEO becomes entitled to severance benefits under the
Severance Plan. The Company has terminated matching contributions to the
Executive Deferred Compensation Plan effective January 1, 2018.
Interest
Amounts deferred
(including earnings and matching contributions) accrue interest until paid. The
interest crediting rate on each NEOs account balance is the average
monthly
Moodys Corporate Bond Yield for Baa
Public Utility Bonds over a sixty-month period ending September 1. EIX
established this interest rate for all plan participants, and has discretion to
change the interest rate on a prospective basis.
Payment of
Grandfathered Benefits
Benefits under
the grandfathered plan document may be deferred until a specified date,
retirement, death or termination of employment. At the participants election,
compensation deferred until retirement or death may be paid as a lump sum, in
monthly installments over 60, 120, or 180 months, or in a combination of a
partial lump sum and installments. Deferred compensation is paid as a single
lump sum or in three annual installments upon any other termination of
employment. However, if a participants employment is terminated without cause,
the participant may elect to receive payment at such time or a later date when
the participant turns age 55, and the same payment options available for
retirement will generally be applicable.
Each NEO was permitted to elect at the
time of deferral to receive payment of such deferral on a fixed date in
accordance with procedures established under the grandfathered plan document,
and deferred amounts may also be paid in connection with a change in control of
EIX or SCE in certain circumstances.
Certain amounts deferred under the
grandfathered plan document may be withdrawn at any time upon the election of an
NEO; however, any amounts withdrawn are subject to a 10% early withdrawal
penalty. Emergency hardship withdrawals without penalty also may be permitted at
EIXs discretion.
2017 Proxy
Statement
|
|
53
|
Table of Contents
EXECUTIVE
COMPENSATION
Payment of 2008 Plan
Benefits
Benefits under the 2008 plan
document may be deferred until a specified date no later than the date the
participant turns age 75, retirement, death, disability or other separation from
service. Participants have sub-accounts for each annual deferral for which the
following forms of payment may be elected: single lump-sum; two to fifteen
annual installments; or monthly installments for 60, 120 or 180
months.
Payments triggered by retirement, death,
disability or other separation from service may begin upon the applicable
triggering event or a specified number of months and/or years following the
applicable triggering event; however, payments may not begin later than the
participants 75
th
birthday unless the participant is still employed.
Payments are subject to certain administrative earliest payment date rules, and
may be delayed or accelerated under the 2008 plan document if permitted or
required under Section 409A of the Internal Revenue Code.
Potential Payments Upon Termination or Change in
Control
|
The following plans provide benefits that
may become payable to NEOs, depending on the circumstances surrounding their
termination of employment with the Company. When listing the potential payments
to the NEOs under the plans described below, it is assumed that the applicable
triggering event (retirement or other termination of employment) occurred on
December 31, 2016 and that the price per share of EIX Common Stock is equal to
the closing price as of the last NYSE trading day in 2016.
2008 Executive
Severance Plan
EIX provides severance benefits and
change-in-control benefits to executives, including all of the NEOs, under the
2008 Executive Severance Plan (the Severance Plan). In addition, severance
benefits are provided through other plans or agreements included in the
following description of severance benefits.
To receive any severance benefits, an NEO
must release EIX and its affiliates from all claims arising out of the officers
employment relationship and agree to certain confidentiality and
non-solicitation restrictions in favor of the Company.
Severance Benefits
No Change in Control
Under the Severance Plan, an eligible
executive is generally entitled to severance benefits if his or her employment
is involuntarily terminated without cause and other than due to the
executives disability (as these terms are defined in the Severance
Plan).
Severance Plan benefits payable upon an
involuntary termination without cause include:
●
|
A lump sum cash payment equal to the
total of (i) a years base salary at the highest rate in effect during the
preceding 24 months, (ii) an amount equal to the executives base salary
at the highest rate in effect during the preceding 24 months multiplied by
the executives highest target annual incentive percentage in effect
during the preceding 24 months, and (iii) an amount equal to a pro-rata
portion, based on the weekdays employed in the year of severance, of the
executives base salary at the highest rate in effect during the preceding
24 months multiplied by the executives highest target annual incentive
percentage in effect during the preceding 24 months (or such lesser
pro-rata annual incentive amount payable under the terms of the 162(m)
Program);
|
●
|
Eligibility for early retiree health
care coverage if the NEO would have been eligible for early retiree health
care coverage under the terms of an applicable non-executive severance
plan, and if not, then an additional 12 to 18 months of health benefits
(no additional health benefits are provided if the NEO is eligible for
retiree health care under the terms applicable to non-executive
non-severed employees);
|
●
|
Reimbursement of up to $20,000 for
outplacement costs incurred within two years following separation from
service; and
|
●
|
Reimbursement for educational costs
up to $5,000 or $10,000, whichever is the applicable maximum amount
allowed under the applicable non-executive severance
plan.
|
In addition to Severance Plan benefits,
other benefits payable to an eligible executive upon an involuntary termination
without cause generally include:
●
|
Vesting in a pro-rata portion of
outstanding stock options and restricted stock units with one additional
year of vesting credit applied under the award terms;
|
●
|
Vesting in a pro-rata portion of
outstanding performance shares that become earned based on Company
performance with one additional year of vesting credit applied under the
award terms;
|
●
|
A period of up to one year to
exercise any vested stock options;
|
●
|
Full vesting and an additional year
of service and age credits for purposes of calculating the executives
benefit under the Executive Retirement Plan; and
|
●
|
Vesting in any unvested amounts
under the Executive Deferred Compensation
Plan.
|
Severance Benefits
Change in Control
The severance benefits described above
would be enhanced if the NEOs employment is terminated for a qualifying reason
during a period that started six months before and ended two years after a
change in control of EIX. Qualifying reasons are defined to include an
involuntary termination of the NEOs employment for any reason other than cause
or disability, or the NEOs voluntary termination of employment for a good
reason (as this term is defined in the Severance Plan). Except as noted below,
these benefits are not triggered automatically by a change in control absent an
actual or constructive termination of the NEOs employment by the Company
without cause.
54
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2017 Proxy
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Table of Contents
EXECUTIVE
COMPENSATION
Upon a qualifying termination,
outstanding stock options, restricted stock units and performance shares and
related dividend equivalents would become fully vested, with performance shares
and related dividend equivalents only becoming earned if actual performance
during the performance period results in a payout, and with stock options
remaining exercisable for up to three years. Absent a qualifying termination,
stock options and performance shares would continue to vest on their normal
schedule unless the awards were not continued or assumed.
The EIX 2007 Performance Incentive Plan
and terms and conditions of awards under the plan provide for special rules that
would apply if outstanding equity awards were not continued or assumed in
connection with any dissolution, sale of all or substantially all of the assets
or stock, merger or reorganization, or other event where EIX is not the
surviving corporation. Following such a transaction, and regardless of whether
an NEOs employment were terminated, outstanding stock options and performance
shares and any related dividend equivalents would become fully vested. Options
that became vested with a change in control would be exercised prior to the
change in control or cashed-out in connection with the change-in-control
transaction.
Performance shares and related dividend
equivalents would be earned based on a shortened performance period. The
performance period applicable to the performance shares would be deemed to end
on the day before the change in control, and performance shares would vest and
become payable, if at all, based on EIXs TSR ranking or achievement of EPS
target, as applicable, during the shortened performance period. Any performance
shares that became payable during the shortened performance period associated
with a change in control would be paid in cash within 74 days after the change
in control, and any performance shares that did not become payable would
terminate for no value on the date of the change in control.
In such a change in control transaction
described above, the restricted stock units would generally continue to vest and
become payable according to their original vesting schedule, unless the
restricted stock units are terminated in accordance with special rules under
Code Section 409A, in which case they would become fully vested.
For the EIX NEOs who were employed on
December 31, 2016 by EIX or its subsidiaries, the enhanced change-in-control
severance benefits would be:
●
|
Three times the cash severance
amount payable for involuntary termination absent a change in control
(except that the pro-rated annual incentive payment amount for the year of
termination would not be trebled);
|
●
|
Health benefits for the maximum
period the NEO would be entitled to continuation coverage under COBRA
(unless eligible for retiree health care);
|
●
|
Three years of service and age
credits under the Executive Retirement Plan; and
|
●
|
Reimbursement of up to $50,000 for
outplacement costs.
|
For the SCE NEOs other than Messrs.
Pizarro and Payne and Ms. Rigatti, the enhanced change-in-control severance
benefits would be:
●
|
Two times the cash severance amount
payable for involuntary termination absent a change in control (except
that the pro-rated annual incentive payment amount for the year of
termination would not be doubled);
|
●
|
Health benefits for the maximum
period the NEO would be entitled to continuation coverage under COBRA
(unless eligible for retiree health care);
|
●
|
Two years of service and age credits
under the Executive Retirement Plan; and
|
●
|
Reimbursement of up to $30,000 for
outplacement costs.
|
Executive Survivor
Benefit Plan
The Executive Survivor Benefit Plan
provided beneficiaries of participants with income continuation benefits if the
participants death occurred while employed. If an NEO had died in 2016 while
employed, the after-tax benefit would have been equal to one or two years cash
compensation (annual salary rate plus average annual incentive
percentage).
The Executive Survivor Benefit Plan was
terminated effective December 31, 2016.
Deferred Compensation
Plans
Upon an NEOs retirement or other
termination of employment, the NEO generally will receive a payout of any
non-qualified deferred compensation balances under the Executive Deferred
Compensation Plan and, for Mr. Litzinger, the AODCP. The Non-Qualified Deferred
Compensation table and related discussion above describe these deferred
compensation balances and payment terms. In the event of involuntary termination
not for cause or qualifying termination in a change in control, unvested amounts
derived from Company contributions would vest. Only Messrs. Umanoff and Nichols
had such unvested amounts as of December 31, 2016, which would have totaled
$49,287 and $10,739, respectively.
SCE Retirement Plan
and Executive Retirement Plan
In connection with an NEOs termination of
employment, the NEO will generally receive a payout of his or her vested
retirement benefits under the SCE Retirement Plan and the Executive Retirement
Plan. See
Pension Benefits
above for a discussion of these retirement payments and
associated survivor benefits.
2017 Proxy
Statement
|
|
55
|
Table of Contents
EXECUTIVE COMPENSATION
EIX
Potential Payments Upon Termination or Change in Control
The following table presents the
estimated payments and benefits that would have been payable as of December 31,
2016 to the EIX NEOs
who were employed on that date by EIX or its subsidiaries, in
the event of involuntary termination of employment without cause (severance),
separation in connection with a change in control of the Company (enhanced
severance), and separation due to death. The amounts reported in the table do
not include benefits that would have been payable to the NEO if the triggering
event had not occurred.
Name
|
Severance
($)
|
|
Enhanced Change
in
Control Severance
(1)
($)
|
|
Death
(2)
($)
|
Pedro J. Pizarro
|
|
|
|
|
|
Lump sum cash
|
3,630,000
|
|
8,360,000
|
|
|
Health care coverage
(3)
|
186,790
|
|
186,790
|
|
|
Retirement plan benefits
(4)
|
690,888
|
|
1,473,580
|
|
|
Equity acceleration
|
1,991,040
|
|
2,790,202
|
|
|
Reimbursable expenses
(5)
|
30,000
|
|
60,000
|
|
|
Survivor benefits
|
|
|
|
|
4,074,549
|
Maria Rigatti
|
|
|
|
|
|
Lump sum cash
|
1,375,000
|
|
3,300,000
|
|
|
Health care coverage
(3)
|
108,177
|
|
108,177
|
|
|
Retirement plan benefits
(4)
|
245,593
|
|
580,906
|
|
|
Equity acceleration
|
454,911
|
|
683,499
|
|
|
Reimbursable expenses
(5)
|
30,000
|
|
60,000
|
|
|
Survivor benefits
|
|
|
|
|
892,976
|
Adam S. Umanoff
|
|
|
|
|
|
Lump sum cash
|
1,375,000
|
|
3,300,000
|
|
|
Health care coverage
|
18,558
|
|
27,837
|
|
|
Retirement plan benefits
(4)
|
629,598
|
|
1,099,757
|
|
|
Equity acceleration
|
1,108,368
|
|
1,581,194
|
|
|
Reimbursable expenses
(5)
|
25,000
|
|
55,000
|
|
|
Survivor benefits
|
|
|
|
|
1,694,453
|
Kevin M. Payne
|
|
|
|
|
|
Lump sum cash
|
1,200,000
|
|
2,900,000
|
|
|
Health care coverage
(3)
|
|
|
|
|
|
Retirement plan benefits
(4)
|
372,891
|
|
740,061
|
|
|
Equity acceleration
|
479,100
|
|
565,424
|
|
|
Reimbursable expenses
(5)
|
30,000
|
|
60,000
|
|
|
Survivor benefits
|
|
|
|
|
839,584
|
Ronald L.
Litzinger
|
|
|
|
|
|
Lump sum cash
|
1,440,000
|
|
3,480,000
|
|
|
Health care coverage
(3)
|
|
|
|
|
|
Retirement plan benefits
(4)
|
1,323,719
|
|
2,540,839
|
|
|
Equity acceleration
|
1,956,984
|
|
2,449,714
|
|
|
Reimbursable expenses
(5)
|
30,000
|
|
60,000
|
|
|
Survivor benefits
|
|
|
|
|
4,302,712
|
(1)
|
The benefits in the table for
a hypothetical change-in-control severance would be in lieu of (not in
addition to) the severance benefits as disclosed for an involuntary
termination without cause. This presentation assumes that equity awards
would be continued following the change-in-control transaction. If equity
awards were to be terminated in connection with a change-in-control
transaction, triggering accelerated vesting of the awards in connection
with the termination of the awards, then the same equity award
acceleration value included in the table above would have been triggered
had such a change in control and termination of the awards occurred on
December 31, 2016. In such circumstances, that equity acceleration value
would not also be included in severance benefits for the NEO as the
benefit would have already been provided in connection with the change in
control.
|
(2)
|
The amounts shown for
separation due to death on December 31, 2016 are benefits that would have
been payable under the Executive Survivor Benefit Plan, which was
terminated effective the end of the day on December 31,
2016.
|
(3)
|
Messrs. Payne and Litzinger
would have each been eligible for retiree health care benefits if the NEO
retired regardless of whether he was eligible to receive severance
benefits. Mr. Pizarro and Ms. Rigatti would have become eligible for
retiree health care benefits as a result of eligibility for severance
benefits.
|
(4)
|
Includes the actuarial value
of additional years of age and service credit under the Executive
Retirement Plan and, for Mr. Umanoff, the value of his Executive
Retirement Plan benefit and Company contributions under the Executive
Deferred Compensation Plan that vest due to severance.
|
(5)
|
Includes outplacement and
educational assistance benefits.
|
56
|
|
2017 Proxy
Statement
|
Table of Contents
EXECUTIVE COMPENSATION
SCE Potential Payments Upon Termination
or Change in Control
The following table presents the
estimated payments and benefits that would have been payable as of December 31,
2016 to the SCE NEOs in the event of involuntary termination of employment
without cause (severance), separation in connection with a change in control of
the Company (enhanced severance), and separation due to death. The amounts
reported in the table do not include benefits that would have been payable to
the NEO if the triggering event had not occurred.
Name
|
Severance
($)
|
|
Enhanced Change in
Control Severance
(1)
($)
|
|
Death
(2)
($)
|
Kevin M. Payne
|
|
|
|
|
|
Lump sum cash
|
1,200,000
|
|
2,900,000
|
|
|
Health care coverage
(3)
|
|
|
|
|
|
Retirement plan benefits
(4)
|
372,891
|
|
740,061
|
|
|
Equity acceleration
|
479,100
|
|
565,424
|
|
|
Reimbursable expenses
(6)
|
30,000
|
|
60,000
|
|
|
Survivor benefits
|
|
|
|
|
839,584
|
Pedro J. Pizarro
|
|
|
|
|
|
Lump sum cash
|
3,630,000
|
|
8,360,000
|
|
|
Health care coverage
(3)
|
186,790
|
|
186,790
|
|
|
Retirement plan benefits
(4)
|
690,888
|
|
1,473,580
|
|
|
Equity acceleration
|
1,991,040
|
|
2,790,202
|
|
|
Reimbursable expenses
(6)
|
30,000
|
|
60,000
|
|
|
Survivor benefits
|
|
|
|
|
4,074,549
|
William M. Petmecky,
III
|
|
|
|
|
|
Lump sum cash
|
630,000
|
|
1,095,000
|
|
|
Health care coverage
(3)
|
23,198
|
|
27,837
|
|
|
Retirement plan benefits
(4)
|
126,567
|
|
208,969
|
|
|
Equity acceleration
|
236,845
|
|
312,731
|
|
|
Reimbursable expenses
(6)
|
30,000
|
|
40,000
|
|
|
Survivor benefits
|
|
|
|
|
633,344
|
Maria Rigatti
|
|
|
|
|
|
Lump sum cash
|
1,375,000
|
|
3,300,000
|
|
|
Health care coverage
(3)
|
108,177
|
|
108,177
|
|
|
Retirement plan benefits
(4)
|
245,593
|
|
580,906
|
|
|
Equity acceleration
|
454,911
|
|
683,499
|
|
|
Reimbursable expenses
(6)
|
30,000
|
|
60,000
|
|
|
Survivor benefits
|
|
|
|
|
892,976
|
Ronald O. Nichols
|
|
|
|
|
|
Lump sum cash
|
880,000
|
|
2,160,000
|
|
|
Health care coverage
|
11,718
|
|
17,576
|
|
|
Retirement plan benefits
(4)
|
418,670
|
|
527,498
|
|
|
Equity acceleration
|
291,404
|
|
383,110
|
|
|
Reimbursable expenses
(6)
|
25,000
|
|
55,000
|
|
|
Survivor benefits
|
|
|
|
|
819,195
|
Russell C. Swartz
|
|
|
|
|
|
Lump sum cash
|
760,200
|
|
1,321,300
|
|
|
Health care coverage
(3)
|
|
|
|
|
|
Retirement plan benefits
(4)
|
137,307
|
|
292,444
|
|
|
Equity acceleration
(5)
|
|
|
|
|
|
Reimbursable expenses
(6)
|
30,000
|
|
40,000
|
|
|
Survivor benefits
|
|
|
|
|
1,142,097
|
2017 Proxy
Statement
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|
57
|
Table of Contents
EXECUTIVE COMPENSATION
Name
|
Severance
($)
|
|
Enhanced Change in
Control Severance
(1)
($)
|
|
Death
(2)
($)
|
Peter T. Dietrich
|
|
|
|
|
|
Lump sum cash
|
1,008,000
|
|
1,752,000
|
|
|
Health care coverage
|
18,558
|
|
27,837
|
|
|
Retirement plan benefits
(4)
|
356,000
|
|
631,376
|
|
|
Equity acceleration
|
723,056
|
|
892,004
|
|
|
Reimbursable expenses
(6)
|
30,000
|
|
40,000
|
|
|
Survivor benefits
|
|
|
|
|
1,461,520
|
(1)
|
The benefits in the table for
a hypothetical change-in-control severance would be in lieu of (not in
addition to) the severance benefits as disclosed for an involuntary
termination without cause. This presentation assumes that equity awards
would be continued following the change-in-control transaction. If equity
awards were to be terminated in connection with a change-in-control
transaction, triggering accelerated vesting of the awards in connection
with the termination of the awards, then the same equity award
acceleration value included in the table above would have been triggered
had such a change in control and termination of the awards occurred on
December 31, 2016. In such circumstances, that equity acceleration value
would not also be included in severance benefits for the NEO as the
benefit would have already been provided in connection with the change in
control.
|
(2)
|
The amounts shown for
separation due to death on December 31, 2016 are benefits that would have
been payable under the Executive Survivor Benefit Plan, which was
terminated effective the end of the day on December 31,
2016.
|
(3)
|
Messrs. Payne and Swartz would
have each been eligible for retiree health care benefits if the NEO
retired regardless of whether he was eligible to receive severance
benefits. Mr. Pizarro and Ms. Rigatti would have become eligible for
retiree health care benefits as a result of eligibility for severance
benefits.
|
(4)
|
Includes the actuarial value
of additional years of age and service credit under the Executive
Retirement Plan and, for Mr. Nichols, the value of his Executive
Retirement Plan benefit and Company contributions under the Executive
Deferred Compensation Plan that vest due to severance.
|
(5)
|
Mr. Swartzs equity would have
vested due to retirement regardless of eligibility to receive severance
benefits.
|
(6)
|
Includes outplacement and
educational assistance benefits.
|
58
|
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2017 Proxy
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Table of Contents
ITEM 5:
SHAREHOLDER PROPOSAL REGARDING SHAREHOLDER PROXY ACCESS REFORM
To Be
Voted On By EIX Shareholders Only
John Chevedden, whose address is 2215
Nelson Ave., No. 205, Redondo Beach, CA 90278, has notified EIX that he
beneficially owns at least 100 shares of EIX and intends to present Item 5 for
action at the Annual Meeting. The text of the shareholder proposal is included
below as submitted by the proponent, and has not been endorsed or verified by
EIX. The EIX Board response to the shareholder proposal follows.
Proposal
5 Shareholder Proxy Access Reform
|
Shareholders request that our board of
directors take the steps necessary to allow up to 50 shareholders to aggregate
their shares to equal 3% of our stock owned continuously for 3-years in order to
make use of shareholder proxy access.
Even if the 20 largest public pension
funds were able to aggregate their shares, they would not meet the 3% criteria
for a continuous 3-years at most companies examined by the Council of
Institutional Investors. Additionally many of the largest investors of major
companies are routinely passive investors who would be unlikely to be part of
the proxy access shareholder aggregation process.
Under this proposal it is unlikely that
the number of shareholders who participate in the aggregation process would
reach an unwieldy number due to the rigorous rules our management adopted for a
shareholder to qualify as one of the aggregation participants. Plus it is easy
for our management to screen aggregating shareholders because management simply
needs to find one item lacking from a list of typical proxy access
requirements.
Please vote to enhance shareholder
value:
Shareholder Proxy Access Reform
Proposal 5
EIX Board
Recommendation Against Item 5
|
The EIX Board of Directors has
considered the shareholder proposal requesting the EIX Board adopt a proxy
access bylaw as described in the proposal (Item 5 on your Proxy Card) and
recommends you vote
Against
the proposal for the following reasons.
The Company has already adopted Bylaws
that give shareholders a meaningful and appropriate proxy access
right.
The shareholder proposal is unnecessary
because our shareholders already have a meaningful and appropriate proxy access
right. In 2015, after engaging with a number of our shareholders, the EIX Board
adopted proxy access for director elections at annual meetings. The EIX Bylaws
provide the Company will include in its Proxy Statement up to two nominees (or
nominees for up to 20% of the Board, whichever is greater) submitted by a
shareholder or group of up to 20 shareholders owning at least 3% of EIX common
stock continuously for at least three years, if the shareholder group and
nominee satisfy the requirements in the EIX Bylaws. These parameters have become
standard among companies that have adopted proxy access.
The EIX Board believes the current
proxy access Bylaws strike an appropriate balance between promoting shareholder
nomination rights and protecting the interests of all shareholders.
The shareholder proposal would require
the Board to amend the EIX Bylaws to increase the number of shareholders who may
aggregate shares to reach the 3% ownership requirement from 20 to 50
shareholders. However, the Board believes increasing the group aggregation limit
does not reflect current best practices and is not in the best interests of our
shareholders.
Before adopting proxy access, we
obtained feedback from major shareholders holding approximately 30% of EIX
Common Stock, including each of our top five holders. These shareholders
supported the 20 shareholder limit. In fact, 311 of the 342 companies (91%) that
adopted proxy access in 2015 and 2016 have a group aggregation limit of exactly
20 shareholders.
The proponents supporting statement
implies that the current
group aggregation limit would prevent pension funds from reaching the 3% ownership
requirement. Based on publicly available data, the Companys ten largest pension
fund shareholders held more than 3% of EIX Common Stock as of December 31, 2016.
We believe increasing the group aggregation limit from 20 to 50 shareholders
would not meaningfully enhance the shareholder nomination right for the
Companys pension fund holders.
2017 Proxy
Statement
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|
59
|
Table of Contents
ITEM 5: SHAREHOLDER PROPOSAL REGARDING
SHAREHOLDER PROXY ACCESS REFORM
The Company has a strong corporate
governance structure and record of accountability.
The Companys current corporate
governance structure reflects a significant and ongoing commitment to strong and
effective governance practices and a willingness to be responsive and
accountable to shareholders. We regularly assess and refine our corporate
governance policies and procedures to take into account evolving best practices
and to address shareholder feedback.
In addition to adopting a meaningful
and appropriate proxy access right, we have implemented numerous other corporate
governance measures to ensure the Board remains accountable to shareholders, to
provide our shareholders with a meaningful voice in the nomination and election
of directors, and to provide our shareholders with the ability to communicate
with directors and promote the consideration of shareholder views. For example:
●
|
Each director serves a one-year
term and stands for reelection at each Annual Meeting.
|
●
|
Directors must be elected by a
majority vote in uncontested elections.
|
●
|
All directors are independent,
except for Mr. Pizarro.
|
●
|
We have an independent Board
chair.
|
●
|
Board committees are composed
solely of independent directors.
|
●
|
Shareholders have the ability
to:
|
-
|
Call special meetings upon
request of 10% of shares;
|
-
|
Act by written
consent;
|
-
|
Recommend director candidates to
the Governance Committee, which evaluates those recommendations in the
same manner as recommendations received from other
sources;
|
-
|
Directly nominate director
candidates and solicit proxies for the election of those candidates in
accordance with our Bylaws and federal securities laws;
|
-
|
Submit proposals for inclusion in
the Companys Proxy Statement for consideration at each Annual Meeting,
subject to SEC rules and regulations;
|
-
|
Communicate directly with the
Board or individual directors by following the procedures described on our
website at www.edison.com/corpgov; and
|
-
|
Express their views on executive
compensation through annual say-on-pay votes, which are considered by
the Compensation Committee.
|
Our Board also has shown an ongoing
commitment to Board refreshment and diversity. Seven of our nine director
nominees have served on the Board for less than six years, including five new
independent directors elected to the Board since 2014. Three of our director
nominees are women and four of our director nominees reflect ethnic
diversity.
For the foregoing
reasons, the EIX Board recommends you vote AGAINST Item
5.
|
60
|
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2017 Proxy
Statement
|
Table of Contents
MEETING AND VOTING
INFORMATION
What is included in the proxy
materials?
The proxy materials include the Proxy
Statement (which includes a letter to shareholders and a Notice of Annual
Meeting), the Annual Report, the Proxy Card, and the Notice of Internet
Availability.
Why did the Company mail a Notice of
Internet Availability instead of a printed copy of the materials?
Providing the proxy materials to
shareholders via the Internet saves us the cost of printing and mailing
documents and reduces the impact of the Annual Meeting on the
environment.
If you received only a Notice of
Internet Availability, you will not receive a printed copy of the proxy
materials unless you request them. The Notice includes instructions on how to
access and review the proxy materials, submit your proxy via the Internet, and
request a printed copy of proxy materials by mail.
Why did some shareholders receive
printed or email copies of the proxy materials?
We are distributing printed copies of
the proxy materials to shareholders who have previously requested printed
copies. We are providing shareholders who have previously requested electronic
delivery of proxy materials with an email containing a link to the website where
the materials are available via the Internet.
Who can vote?
All owners of voting stock at the close
of business on March 3, 2017 (the record date) may vote.
On each Item of EIX business, holders
of EIX Common Stock are entitled to one vote per share. On each Item of SCE
business, holders of SCE Cumulative Preferred Stock are entitled to six votes
per share and EIX, as the holder of SCE Common Stock, is entitled to one vote
per share. All shares of SCE Common and Cumulative Preferred Stock vote together
as one class.
Who can attend the Annual
Meeting?
All shareholders on the record date, or
their duly appointed proxies, may attend the meeting. All shareholders will be
required to pass through a security inspection area (where all packages will be
subject to search) and check in at the registration desk at the meeting. The
registration desk will open at 8:00 a.m. and meeting room doors will open at
8:30 a.m., Pacific Time. For your protection, purses, briefcases, backpacks, and
packages may be subject to inspection. Shareholders may not bring signs,
banners, handouts, or similar items into the meeting room. Photography and
video/audio recording of the Annual Meeting are not permitted.
If you are a Registered Shareholder or
a 401(k) Plan Shareholder, we can verify your share ownership from the share
register with proper identification. No admission pass is required. To be
admitted as a proxy for a Registered Shareholder, you must provide a written
authorization from the Registered Shareholder.
If your shares are held in Street Name,
you will need to bring proper identification and a letter or an account
statement from your broker or other nominee reflecting your stock ownership as
of the record date. To be admitted as a proxy for a broker, you must provide a
written authorization from the broker with a letter or account statement
reflecting the brokers ownership as of the record date. If a nominee holds the
shares, you must provide a written authorization from the nominee to the broker
that is assignable, a written authorization from the broker, and a letter or
account statement reflecting the nominees ownership as of the record
date.
Individual shareholders may bring one
guest to the Annual Meeting. A shareholder that is a corporation, partnership,
association or other entity is limited to three authorized representatives at
the Annual Meeting.
Where is the Annual Meeting
Located?
The Hilton Los Angeles/San Gabriel
Hotel is located just north of Interstate 10, approximately ten miles east of
Downtown Los Angeles. From Interstate 10, take the Del Mar Ave. exit north
(towards San Gabriel) to Valley Blvd. Turn left at Valley Blvd. to 225 West
Valley Blvd.
How do I vote?
Your vote is important. You can save us
the expense of additional solicitations by voting promptly. Please follow the
instructions described below:
By Internet
Shareholders who received
a Notice of Internet Availability may vote via the Internet by following the
instructions on the Notice. Shareholders who received a Proxy Card by mail may
vote via the Internet by following the instructions on the Proxy Card. When
voting via the Internet, all shareholders must have available the control number
on their Notice of Internet Availability or Proxy Card. Under California law,
you may transmit a proxy via the Internet.
By Telephone
Registered or 401(k)
Plan Shareholders may vote by telephone by calling 1-866-883-3382 and following
the recorded instructions. Most shareholders who hold their shares in
2017 Proxy
Statement
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|
61
|
Table of Contents
MEETING AND VOTING
INFORMATION
Street Name may vote by phone by
calling the number provided by their broker. When voting by telephone, all
shareholders must have available the control number on their Notice of Internet
Availability or Proxy Card.
By Mail
Shareholders who received a
printed copy of these proxy materials may vote by mail by completing, signing,
dating and returning their Proxy Card as indicated.
In Person
Registered Shareholders may
vote in person by attending the Annual Meeting and completing a ballot
distributed at the meeting. Shareholders who hold their shares in Street Name
may vote in person by attending the Annual Meeting only if they have requested
and received a legal proxy from their broker or other nominee, and deliver the
proxy to the inspector of election before or at the meeting. 401(k) Plan
Shareholders may not cast votes in person at the Annual Meeting.
What is the deadline to vote and how
do I change my vote?
If you are a Registered Shareholder,
the inspector of election will accept your proxy by telephone or via the
Internet until 9:00 p.m., Pacific Time, on April 26, 2017, and by mail if it is
received by the inspector of election before the polls close at the Annual
Meeting. Registered Shareholders may change their vote prior to the deadline by
writing to the Corporate Secretary at the address above (so it is received prior
to the deadline), voting again by mail, telephone or the Internet, or voting in
person at the Annual Meeting.
If you hold shares in Street Name, most
brokers will accept your proxy by telephone or the Internet until 9:00 p.m.,
Pacific Time, on April 26, 2017, and by mail if it is received by your brokers
designated agent by 9:00 a.m., Pacific Time, on April 27, 2017. Contact your
broker or other nominee before the Annual Meeting to determine the actual
deadline and whether and how you can change your vote.
If you are a 401(k) Plan Shareholder,
your proxy must be received by 9:00 p.m., Pacific Time, on April 25, 2017 for
the 401(k) Plan trustee to vote your shares. 401(k) Plan Shareholders may change
their vote prior to this deadline by voting again. The last vote received within
this timeframe will be the vote counted.
What does it mean if I get more than
one Notice of Internet Availability or Proxy Card?
It indicates that your shares are held
in more than one account, such as two brokerage accounts, or you hold both
registered and Street Name shares, or you hold shares in both EIX and SCE. Use
the control numbers provided on each Notice of Internet Availability or Proxy
Card and vote each Notice or Proxy Card to ensure that all of your shares are
voted.
What shares are covered by the Proxy
Card?
This depends on how you hold your
shares, and whether you hold shares in EIX, SCE, or both EIX and SCE.
Registered and 401(k) Plan Shareholders
For EIX registered and 401(k) Plan Shareholders, you will receive or have
Internet access to a single Proxy Card that covers all shares of EIX Common
Stock in your registered and 401(k) Plan accounts,
including fractional shares held in the 401(k) Plan but excluding
fractional shares held in the Dividend Reinvestment and Direct Stock Purchase
Plan.
For SCE Registered Shareholders, you
will receive or have Internet access to separate Proxy Cards for each series of
preferred stock registered in your name.
If you hold registered shares in both
EIX and SCE, you will receive or have Internet access to separate Proxy Cards
for each Company.
Street Name Shareholders
If you hold
shares of EIX and/or SCE in Street Name, you will receive or have Internet
access to separate Proxy Cards from each broker or other nominee.
What happens if I submit my Proxy
Card but do not indicate my voting preference?
The proxies and 401(k) Plan trustee
will vote FOR election of all nominees for director (Item 1), FOR
ratification of the appointment of the independent registered public accounting
firm (Item 2), FOR approval of executive compensation (Item 3), to hold the
advisory vote on the frequency of Say-on-Pay votes every year (Item 4), and
AGAINST the shareholder proposal regarding shareholder proxy access reform
(Item 5, EIX only).
What happens if I submit my Proxy
Card but do not sign or date my card?
Those shares will be treated as unvoted
shares on all matters and will not be considered as present and part of the
quorum.
What happens if I do not
vote?
If you are a Registered Shareholder,
your shares will not be voted.
If you hold your shares in Street Name,
most brokers or other nominees will only have authority to vote your shares on
ratification of the appointment of the independent registered public accounting
firm (Item 2). Regarding each of the other Items, most brokers or other nominees
will not have authority to vote your shares, and the shares will instead be
treated as broker non-votes.
If you are a 401(k) Plan Shareholder,
the 401(k) Plan trustee will vote your shares in the same proportion to the
401(k) Plan shares voted by other 401(k) Plan Shareholders, unless contrary to
ERISA.
How many votes do you need to hold
the meeting?
A quorum is required for the Company to
conduct business at the Annual Meeting. The presence at the Annual Meeting, in
person or by proxy, of shareholders entitled to cast a majority of the votes
that all shareholders may cast constitutes a quorum. All shares represented by a
properly signed proxy will be considered as present and part of the quorum, even
if you or your broker or other nominee doesnt vote or abstains on any or all
matters.
As of the record date, EIX had
325,811,206 shares of Common Stock outstanding,325,800,887
of which may cast
325,800,887 votes. Therefore, a quorum for EIX is 162,900,444 shares. SCE had
4,800,198 shares of Cumulative Preferred
62
|
|
2017 Proxy
Statement
|
Table of Contents
MEETING AND VOTING
INFORMATION
Stock outstanding and entitled to cast
28,801,188 votes, and 434,888,104 shares of Common Stock outstanding and
entitled to cast 434,888,104 votes. Voting together as a class, the SCE
shareholders may cast 463,689,292 votes. Therefore, a quorum for SCE is
231,844,647 shares.
What vote is required to adopt each
Item at the meeting?
Shareholders may vote for, against
or abstain with respect to each proposal. A director nominee will be elected
and a proposal will be approved if the following votes are obtained:
●
|
The affirmative vote of
at least a majority of the votes cast on the director or proposal.
Abstentions and broker non-votes are not treated as votes cast, and
therefore will not affect the vote; and
|
●
|
The affirmative vote of
at least a majority of the votes required to constitute a quorum.
Abstentions and broker non-votes are not treated as votes cast and
therefore will have the effect of votes cast against the director or
proposal for these votes.
|
Who will count the
votes?
Wells Fargo Bank, N.A., will tabulate
the votes and is expected to act as the inspector of election. To protect the
confidentiality of votes cast under the 401(k) Plan, 401(k) Plan Shareholders
voting instructions are given directly to Wells Fargo. Wells Fargo will tabulate
those votes and provide aggregate voting results directly to the 401(k) Plan
trustee. EIX will not have access to any of the 401(k) Plan Shareholders voting
instructions, and 401(k) Plan voting results are only reported to EIX in the
aggregate.
How much will this proxy
solicitation cost?
We have retained D.F. King & Co.,
Inc. to assist us with the solicitation of proxies and will pay an aggregate fee
of $22,500 (EIX $20,000 and SCE $2,500) plus expenses. This fee does not include
the costs of printing and mailing the proxy materials. Some of the directors,
officers and other employees of the Company also may solicit proxies personally,
by mail, by telephone or by other electronic means for no additional
compensation. We will also reimburse brokers and other nominees for their
reasonable out-of-pocket and other actual expenses for forwarding proxy
materials to beneficial owners and obtaining voting instructions.
Whom may I call with questions about
the meeting or voting?
You may call Wells Fargo at
1-800-347-8625 or visit their Internet website at
www.shareowneronline.com
.
What happens if additional matters
are presented at the Annual Meeting?
The Board is not aware of, and does not
intend to present, any business to be acted upon at the Annual Meeting other
than the Items described in this Proxy Statement. If you submit a proxy and any
other matters properly come before the Annual Meeting, including matters
incident to the conduct of the Annual Meeting, the persons named as proxy
holders will have the discretionary authority to vote your shares under their
best judgment. If any of the nominees for election to the Board become
unavailable to stand for election as a director, the proxies will also have the
authority to vote for substitute nominees chosen by the Board.
What is the deadline to submit
shareholder proposals or other business for the 2017 Annual
Meeting?
The deadline to submit shareholder
proposals for the Companys 2017 Annual Meeting was November 18, 2016. To be
considered for inclusion in the 2018 Proxy Statement, shareholder proposals for
the Companys 2018 Annual Meeting must be received by November 17,
2017.
Shareholders intending to bring any
other business before an Annual Meeting, including director nominations, must
give written notice to the Corporate Secretary of the business to be presented.
The notice must be received at our office within the periods, and with the
information and documents, specified in the Bylaws.
Assuming that the 2018 Annual Meeting
is held on April 26, 2018, as specified by the Bylaws, and does not change by
more than 30 days earlier or later, the period for the receipt by the Corporate
Secretary of written notice of other business to be brought by shareholders
before the 2018 Annual Meeting, including director nominations presented for
inclusion in the 2018 Proxy Statement or otherwise, will begin on September 18,
2017 and end on November 17, 2017.
2017 Proxy
Statement
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63
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Table of Contents
TERMS USED IN THIS PROXY
STATEMENT
401(k) Plan
|
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The employee benefit plan known
as the Edison 401(k) Savings Plan through which participants may hold
interests in EIX shares through the EIX Stock Fund
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401(k) Plan Shareholders
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Participants in the 401(k) Plan
who hold interests in EIX shares through the EIX Stock Fund
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Annual Meeting
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The EIX and SCE annual meetings
of shareholders, which are held jointly
|
Annual Report
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The EIX and SCE 2016 combined
annual report on Form 10-K, which is prepared and filed with the SEC
jointly
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Board
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Both the EIX and SCE Boards of
Directors, unless otherwise indicated
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Committee
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The applicable Board committees
of both EIX and SCE, unless otherwise indicated
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Company
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Both EIX and SCE, unless
otherwise indicated
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Compensation Committee
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The Compensation and Executive
Personnel Committees of both EIX and SCE, unless otherwise indicated
|
Edison Energy Group
or EEG
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Edison Energy Group, Inc., a
wholly-owned subsidiary of EIX and the holding company for EIXs
competitive businesses in emerging sectors of the electric industry
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EIX
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Edison International
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EME
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Edison Mission Energy, an
indirect wholly-owned subsidiary of EIX
EME was an independent power producer that filed for bankruptcy in
2012
In April 2014, substantially all
of EMEs assets and liabilities were discharged in bankruptcy or
transferred to third parties
|
ERISA
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The Employee Retirement Income
Security Act of 1974
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FOSO Committee
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The Finance, Operations and
Safety Oversight Committees of both EIX and SCE, unless otherwise
indicated
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Governance Committee
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The Nominating/Corporate
Governance Committees of both EIX and SCE, unless otherwise indicated
|
Notice of Internet Availability,
or Notice
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The notice regarding the
availability on the Internet of the Companys proxy materials, which was
mailed to most shareholders in lieu of printed copies of the proxy
materials, as permitted under SEC rules
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Proxy Card
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Either a proxy card, which you
may receive if you are a Registered Shareholder, or a voting instruction
form, which you may receive if you hold shares in Street Name or are a
401(k) Plan Shareholder
|
Proxy Statement
|
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The EIX and SCE proxy statements,
which are prepared and filed with the SEC jointly
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Registered Shareholder
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Your shares are registered in
your own name on the Companys records
Shares held in your Dividend
Reinvestment and Direct Stock Purchase Plan account are included
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SCE
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Southern California Edison
Company
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Street Name
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Your shares are held in a
brokerage account or through a trustee, custodian or other third party
(referred to as a nominee), and you are the beneficial owner of those
shares
Your name does not appear on the Companys records as a
shareholder
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64
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2017 Proxy
Statement
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Table of Contents
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Shareowner Services
P.O.
Box 64945
St. Paul, MN 55164-0945
|
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|
EDISON INTERNATIONAL
ANNUAL MEETING OF
SHAREHOLDERS
Thursday, April 27, 2017
9:00 a.m., Pacific
Time
Hilton Los Angeles/San Gabriel
Hotel
225 West Valley Blvd.
San Gabriel, California
91776
Directions to the Edison
International Annual
Meeting are available in the proxy statement
which
can be viewed at
www.edison.com/annualmeeting
|
Important Notice Regarding the Availability
of Proxy Materials for the
Shareholder Meeting to be Held on April 27,
2017.
Notice is hereby given that the Annual
Meeting of Shareholders of Edison International will be held at the Hilton Los
Angeles/San Gabriel Hotel, 225 West Valley Blvd., San Gabriel, California
91776.
This communication presents only an
overview of the more complete proxy materials that are available to you on the
Internet. We encourage you to access and review all of the important information
contained in the proxy materials before voting.
The Proxy Statement and the 2016 Annual
Report are available at
www.edison.com/annualmeeting
.
If you want to receive a paper or email
copy of these documents, you must request one. There is no charge to you for
requesting a copy. Please make your request for a copy as instructed on the
reverse side of this notice on or before April 12, 2017 to facilitate timely
delivery.
Matters intended to be acted upon at the
meeting are listed below.
|
The Board of
Directors recommends that you vote FOR Items 1, 2 and 3,
1 YEAR for Item 4, and AGAINST Item
5:
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1.
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Election of Directors:
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01
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Vanessa C.L. Chang
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04
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Pedro J. Pizarro
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07
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Ellen O. Tauscher
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02
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Louis Hernandez, Jr.
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05
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Linda G. Stuntz
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08
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Peter J.
Taylor
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03
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James T. Morris
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06
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William P. Sullivan
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09
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Brett
White
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2.
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Ratification of the Appointment of
the Independent Registered Public Accounting Firm
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3.
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Advisory Vote to Approve the Companys Executive
Compensation
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4.
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Advisory Vote on the Frequency of Say-on-Pay
Votes
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5.
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Shareholder Proposal Regarding Shareholder Proxy Access
Reform
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THIS IS NOT A FORM FOR VOTING
You may immediately vote your proxy on the
Internet at:
www.proxypush.com/eix
●
|
Use the
Internet to vote your proxy 24 hours a day, 7 days a week, until 9:00 p.m.
Pacific Time on April 26, 2017, except for Edison 401(k) Savings Plan
shareholders who must vote by 9:00 p.m. Pacific Time on April 25,
2017.
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●
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Please have
this Notice available and follow the instructions to vote your
proxy.
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Your Internet vote authorizes the
Named Proxies to vote your shares in the same manner as if you marked, signed
and returned a proxy card.
Table of Contents
To request paper copies of the proxy
materials, please contact us via:
|
|
Internet
Access the
Internet and go to
www.proxydocs.com/eix
. Follow the instructions to log in,
and order copies.
|
|
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Telephone
Call us free of charge at
1-866-870-3684
from the U.S. or Canada, using a
touch-tone phone, and follow the instructions to log in and order
copies.
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Email
Send us an email
at
paper@investorelections.com
with EIX Materials Request in
the subject line. The email must
include:
|
|
●
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The 11-digit control #
located in the box in the upper right hand corner on the front of this
notice.
|
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●
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Your preference to
receive printed materials via mail
-or-
an email with links to the
electronic materials.
|
|
●
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If you choose email delivery, you
must include the email address.
|
|
●
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If you would like this
election to apply to delivery of material for all
future meetings, write the word Permanent in the
email.
|
Important Information About This
Notice
This Important Notice Regarding the
Availability of Proxy Materials is provided to shareholders in place of printed
materials for the upcoming Annual Meeting of Shareholders. You will not receive
a printed copy of the proxy materials unless you request one by following the
instructions above.
In 2007, the Securities and Exchange
Commission adopted a rule permitting companies to send shareholders a notice
regarding the Internet availability of proxy materials rather than distribute
printed proxy materials. Distributing these proxy materials via the Internet
saves us the cost of printing, mailing and storing documents, and reduces the
impact of the Annual Meeting on the environment.
This Notice contains specific information
regarding the Annual Meeting, the proposals to be voted on at the Annual
Meeting, and the Internet site where the proxy materials may be found. It is
not a form for voting and should not be returned to the Company or Wells Fargo
Shareowner Services. Please use the company and control numbers provided on the
first page of this Notice to vote your shares at
www.proxypush.com/eix
.
Table of Contents
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|
Shareowner Services
P.O. Box
64945
St. Paul, MN 55164-0945
|
|
Address Change? Mark
box, sign, and indicate changes below:
☐
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Vote by Internet, Telephone or Mail
24 Hours
a Day, 7 Days a Week
Your phone
or Internet vote authorizes the named proxies to vote your shares in the
same manner as if you marked, signed and returned your proxy
card.
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INTERNET
www.proxypush.com/eix
Use the Internet to vote your
proxy.
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PHONE
1-866-883-3382
Use a
touch-tone telephone to vote your proxy.
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Mail
Mark, sign and date your proxy card and return it in the
postage-paid envelope provided.
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Your vote by phone or Internet authorizes the proxies and/or the Edison 401(k) Savings Plan Edison International stock fund trustee to vote your
shares to the same extent as if you marked, signed, dated and returned the proxy card. Voting instructions to the Edison International stock fund
trustee are confidential. All stock for which the Edison International stock fund trustee has not received voting instructions by 9:00 p.m., Pacific
Time, on April 25, 2017, will be voted in the same proportion to the 401(k) Savings Plan shares voted by other 401(k) Savings Plan participants,
unless contrary to ERISA. All other stock may be voted by phone or Internet through 9:00 p.m., Pacific Time, on April 26, 2017.
If you vote your proxy by Internet or
by Telephone, please do NOT mail your Proxy Card.
TO VOTE BY MAIL AS THE BOARD OF
DIRECTORS RECOMMENDS ON ALL ITEMS BELOW,
SIMPLY SIGN, DATE, AND RETURN THIS
PROXY CARD.
⇩
Please fold here Do not
separate
⇩
|
The Board of Directors Recommends a
Vote FOR Items 1, 2 and 3, 1 Year for Item 4, and AGAINST Item
5.
|
1.
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Election of
directors:
|
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FOR
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AGAINST
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ABSTAIN
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FOR
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AGAINST
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ABSTAIN
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01 Vanessa C.L.
Chang
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☐
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☐
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☐
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06 William P.
Sullivan
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☐
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☐
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☐
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02 Louis
Hernandez, Jr.
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☐
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☐
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☐
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07 Ellen O.
Tauscher
|
☐
|
☐
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☐
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03 James T.
Morris
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☐
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☐
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☐
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08 Peter J.
Taylor
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☐
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☐
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☐
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04 Pedro J.
Pizarro
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☐
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☐
|
☐
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09 Brett
White
|
☐
|
☐
|
☐
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05 Linda G.
Stuntz
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☐
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☐
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☐
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2.
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Ratification
of the Appointment of the Independent Registered Public Accounting
Firm
|
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☐
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For
|
☐
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Against
|
☐
|
Abstain
|
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3.
|
Advisory Vote to Approve the Companys Executive
Compensation
|
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☐
|
For
|
☐
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Against
|
☐
|
Abstain
|
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|
|
|
|
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4.
|
Advisory Vote on the Frequency of Say-on-Pay
Votes
|
|
☐
|
1
Year
|
☐
|
2
Years
|
☐
|
3
Years
|
☐
|
Abstain
|
|
|
|
|
|
|
|
|
|
|
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|
|
|
|
5.
|
Shareholder Proposal Regarding Shareholder Proxy Access
Reform
|
|
|
|
☐
|
For
|
☐
|
Against
|
☐
|
Abstain
|
|
|
|
|
|
|
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|
WHEN PROPERLY EXECUTED, THIS
PROXY CARD WILL BE VOTED AS DIRECTED OR, IF NO DIRECTION IS GIVEN, WILL BE
VOTED FOR ITEMS 1, 2 AND 3, 1 YEAR FOR ITEM 4, AND AGAINST ITEM
5.
|
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|
Date
|
|
|
I plan to attend
the meeting.
☐
|
|
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|
|
Signature(s) in
Box
|
|
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|
|
Please sign exactly as your name(s) appears on this card.
Trustees, administrators, etc., should include title and
authority. Corporations should provide full name of
corporation and title of authorized officer signing this card.
|
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Table of Contents
2017 ANNUAL MEETING OF
SHAREHOLDERS
Thursday, April 27,
2017
9:00 a.m. Pacific Time
Hilton Los Angeles/San Gabriel
Hotel
225 West Valley Blvd.
San Gabriel,
California 91776
EDISON INTERNATIONAL
|
proxy
card
|
Annual Meeting April 27,
2017
THIS PROXY IS SOLICITED ON BEHALF OF THE
BOARD OF DIRECTORS
PEDRO J. PIZARRO and MARIA RIGATTI are
hereby appointed proxies of the undersigned with full power of substitution to
vote all shares of stock the undersigned is entitled to vote at the annual meeting
of shareholders of Edison International to be held at the Hilton Los
Angeles/San Gabriel Hotel, 225 West Valley Blvd., San Gabriel, California 91776,
on April 27, 2017, at 9:00 a.m., Pacific Time, or at any adjournment or postponement
of the meeting, with all the powers and discretionary authority the undersigned would possess if
personally present at the meeting on the matters listed on the other
side.
The shares
will be voted as indicated on this card.
WHERE NO
INDICATION IS SHOWN, THE SHARES REPRESENTED BY THIS CARD WILL BE VOTED FOR
ITEMS 1, 2 AND 3, 1 YEAR FOR ITEM 4, AND AGAINST ITEM 5.
In addition, the appointed proxies may vote in their
discretion on such other matters as may properly come before the
meeting.
VOTING INSTRUCTIONS TO
THE EDISON INTERNATIONAL STOCK FUND TRUSTEE, STATE STREET BANK AND TRUST
COMPANY:
If the
undersigned holds shares through the Edison 401(k) Savings Plan, this card also
provides the following voting instructions to the Edison International stock
fund trustee. The Edison International stock fund trustee is instructed to vote
confidentially the shares of stock credited and conditionally credited to the
undersigneds account as of March 3, 2017. The undersigned understands that the
stock will be voted as directed provided the Edison International stock fund
trustee or its agent receives this card by 9:00 p.m., Pacific Time, on April 25,
2017, and all stock for which the Edison International stock fund trustee or its agent has
not received instructions by this card at the designated time will be voted in
the same proportion to the 401(k) Savings Plan shares voted by other 401(k)
Savings Plan participants, unless contrary to ERISA.
IF YOU RECEIVE MORE
THAN ONE SET OF PROXY MATERIALS, PLEASE MARK, SIGN, DATE AND RETURN ALL CARDS
YOU RECEIVE PROMPTLY USING THE ENCLOSED ENVELOPES. TO VOTE BY PHONE OR THE
INTERNET, PLEASE SEE THE REVERSE SIDE OF THIS CARD.
See reverse for voting
instructions.
Table of Contents
The following email was sent on March 17, 2017 to
Edison International registered and 401(k) Plan shareholders who previously
requested email delivery of their proxy materials:
Dear Edison International
Shareholder:
The 2017 Annual Meeting of Shareholders will be
held at 9:00 a.m. on Thursday, April 27, 2017 at the Hilton Los Angeles/San
Gabriel Hotel, San Gabriel, CA, 91776.
Our records indicate that you consented to
receive your proxy materials over the Internet. This email provides the
information you need to view the proxy materials online and vote your
shares.
The Proxy Statement and 2016 Annual Report are
available at www.edison.com/annualmeeting.
The Notice of Annual Meeting is included in the
Proxy Statement.
You may use the Internet to vote your proxy 24
hours a day, 7 days a week, through 9:00 p.m. Pacific Time on April 26, 2017,
except shares held through the Edison 401(k) Savings Plan must be voted by 9:00
p.m. Pacific Time on April 25, 2017.
You will need the following important number to
access the Internet voting site and vote your shares:
Your personal eleven-digit control number:
00000000000
If you receive more than one email, it means that
your shares are held in more than one account. Use the control numbers provided
on each email to ensure that all of your shares are voted.
Thank you for your attention to this important
matter.
Barbara E. Mathews
Vice President, Associate General Counsel,
Chief Governance Officer and Corporate Secretary
Edison (NYSE:EIX)
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