<PAGE>
As filed with the Securities and Exchange Commission on July 13, 1999
Registration No. 333-82293
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SECURITIES AND EXCHANGE COMMISSION
Washington, DC 20549
--------------
AMENDMENT NO. 1
to
FORM S-3
REGISTRATION STATEMENT UNDER THE SECURITIES ACT OF 1933
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<TABLE>
<CAPTION>
Edison International California 95-4137452
<S> <C> <C>
EIX Trust I Delaware 95-7077769
EIX Trust II Delaware 95-7077770
EIX Trust III Delaware 95-7077771
(State or Other Jurisdiction (I.R.S. Employer
(Exact name of Registrant of Identification Number)
as Specified in Its Incorporation or
Charter) Organization)
</TABLE>
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2244 Walnut Grove Avenue
(P.O. Box 800)
Rosemead, California 91770
(626) 302-2222
(Address, Including Zip Code, and Telephone Number, Including Area Code, of
each Registrant's Principal Executive Offices)
--------------
Kenneth S. Stewart, Esq.
Assistant General Counsel and Assistant Secretary
2244 Walnut Grove Avenue
Rosemead, California 91770
(626) 302-6601
(Name, Address, Including Zip Code, and Telephone Number, Including Area Code,
of Agent For Service)
--------------
Approximate Date of Commencement of Proposed Sale to the Public: From time
to time after the registration statement becomes effective, as determined by
market and other conditions.
--------------
If the only securities being registered on this form are being offered
pursuant to dividend or interest reinvestment plans, please check the
following box. [_]
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If any of the securities being registered on this form are to be offered on
a delayed or continuous basis pursuant to Rule 415 under the Securities Act of
1933, other than securities offered only in connection with dividend or
interest reinvestment plans, check the following box. [X]
--------------
If this form is filed to register additional securities for an offering
pursuant to Rule 462(b) under the Securities Act, please check the following
box and list the Securities Act registration statement number of the earlier
effective registration statement for the same offering. [_]
--------------
If this form is a post-effective amendment filed pursuant to Rule 462(c)
under the Securities Act, check the following box and list the Securities Act
registration statement number of the earlier effective registration statement
for the same offering. [_]
--------------
If delivery of the prospectus is expected to be made pursuant to Rule 434,
please check the following box. [_]
CALCULATION OF REGISTRATION FEE
<TABLE>
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<CAPTION>
Title of each class of Proposed maximum Amount of
securities to be Amount to be aggregate offering Registration
registered(1) registered(1)(2)(3) price(3)(4) Fee(7)
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<S> <C> <C> <C>
Debt Securities, Common Stock, without par
value, and Preferred Stock, without par
value, of Edison International..............
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Rights to Purchase Series A Junior
Participating Cumulative Preferred Stock,
without par value, of Edison
International(5)............................
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Preferred Securities of EIX Trust I, EIX
Trust II and EIX Trust III(6)...............
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Guarantees of Preferred Securities of the
Trusts by Edison International(6)...........
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Total..................................... $2,500,000,000 $2,500,000,000 $695,000
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</TABLE>
(1) An indeterminate principal amount or number of debt securities, common
stock and/or preferred stock and guarantees of Edison International and an
indeterminate number of preferred securities of the Trusts as may from
time to time be issued at indeterminate prices, with an aggregate offering
price not to exceed $2,500,000,000. Debt securities may be issued and sold
to the Trusts, in which event the debt securities may later be distributed
to the holders of preferred securities.
(2) In United States dollars or the equivalent thereof in any other currency,
composite currency or currency unit as shall result in an aggregate
initial offering price for all securities of $2,500,000,000.
(3) This amount represents the principal amount of any debt securities issued
at their principal amount, the issue price of any debt securities issued
at an original issue discount, the issue price of any preferred stock and
preferred securities and the amount computed pursuant to Rule 457(c) for
any common stock.
(4) Estimated solely for the purpose of calculating the registration fee,
which is calculated in accordance with Rule 457(o) of the rules and
regulations under the Securities Act of 1933. Rule 457(o) permits the
registration fee to be calculated on the basis of the maximum offering
price of all of the securities listed and, therefore, the table does not
specify by each class information as to the amount to be registered, the
proposed maximum offering price per unit or the proposed maximum aggregate
offering price.
(5) The Rights are initially carried and traded with the common stock. The
value attributable to the Rights, if any, is reflected in the value of the
common stock.
(6) Includes the rights of holders of the preferred securities under the
guarantees of preferred securities and back-up undertakings, consisting of
obligations by Edison International, as set forth in the trust agreement,
the applicable indenture and any supplemental indenture thereto, in each
case as further described in the Registration Statement. No separate
consideration will be received for any guarantees or any back-up
undertakings.
(7) Fee of $695,000 paid in connection with original Registration Statement
filed on July 2, 1999.
--------------
The Registrants hereby amend this Registration Statement on such date or
dates as may be necessary to delay its effective date until the Registrants
shall file a further amendment which specifically states that this
Registration Statement shall thereafter become effective in accordance with
Section 8(a) of the Securities Act of 1933 or until this Registration
Statement shall become effective on such date as the Securities and Exchange
Commission, acting pursuant to said Section 8(a), may determine.
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<PAGE>
EXPLANATORY NOTE
This Registration Statement includes a prospectus supplement that relates to
the proposed offering of QUIPS as described therein currently planned to
commence as soon as practicable after the effective date of the Registration
Statement.
<PAGE>
++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++
+The information in this prospectus is not complete and may be changed. We may +
+not sell these securities until the registration statement filed with the +
+Securities and Exchange Commission is effective. This prospectus is not an +
+offer to sell these securities and it is not soliciting an offer to buy these +
+securities in any state where the offer or sale is not permitted. +
++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++
Subject to Completion, Dated July 13, 1999.
Prospectus Supplement to Prospectus Dated , 1999.
[LOGO OF EDISON INTERNATIONAL]
20,000,000 Preferred Securities
EIX Trust I
% Cumulative Quarterly Income Preferred Securities,
Series A (QUIPS(SM))*
(Liquidation Amount $25 per QUIPS)
Fully and unconditionally guaranteed, as described herein, by
Edison International
----------
A brief description of the % Cumulative Quarterly Income Preferred
Securities, Series A (QUIPS(SM)) can be found under "Summary Information--Q&A"
in this prospectus supplement.
Application has been made to list the QUIPS on the New York Stock Exchange.
If the QUIPS are approved for listing, Edison International expects trading of
the QUIPS to begin within 30 days after they are first issued.
See "Risk Factors" beginning on page S-6 to read about specific risks you
should consider before buying the QUIPS.
----------
Neither the Securities and Exchange Commission nor any other regulatory body
has approved or disapproved of these securities or passed upon the accuracy or
adequacy of this prospectus. Any representation to the contrary is a criminal
offense.
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<TABLE>
<CAPTION>
Per QUIPS Total
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<S> <C> <C>
Initial public offering price(1)....................... $25.00 $500,000,000
Underwriting commissions to be paid by Edison
International......................................... $ $
Proceeds to EIX Trust I................................ $ $
</TABLE>
- -----
(1) Plus accumulated distributions, if any, from , 1999.
The Underwriters may, subject to the terms of the underwriting agreement,
purchase up to an additional 3,000,000 QUIPS from EIX Trust I at the initial
public offering price per QUIPS (plus accumulated distributions, if any, from
, 1999), less the underwriting commissions.
----------
The Underwriters expect to deliver the QUIPS in book-entry form only through
the facilities of The Depository Trust Company against payment in New York, New
York on , 1999.
*"QUIPS" AND "QUIDS" are registered service marks of Goldman, Sachs & Co.
Goldman, Sachs & Co.
A.G. Edwards & Sons, Inc.
Lehman Brothers
Merrill Lynch & Co.
Morgan Stanley Dean Witter
PaineWebber Incorporated
Prudential Securities Incorporated
Salomon Smith Barney
----------
Prospectus Supplement dated , 1999.
<PAGE>
SUMMARY INFORMATION--Q&A
The following information supplements, and should be read together with,
the information contained in other parts of this prospectus supplement and in
the accompanying prospectus. This summary highlights selected information from
this prospectus supplement and the accompanying prospectus to help you
understand the % Cumulative Quarterly Income Preferred Securities, Series A
(QUIPS(SM)) (the "Series A QUIPS"). You should carefully read this prospectus
supplement and the accompanying prospectus to understand fully the terms of the
Series A QUIPS as well as the tax and other considerations that are important
to you in making a decision about whether to invest in the Series A QUIPS. You
should pay special attention to the "Risk Factors" section beginning on Page S-
6 of this prospectus supplement to determine whether an investment in the
Series A QUIPS is appropriate for you.
What are the Series A QUIPS?
Each Series A QUIPS represents an undivided beneficial interest in the
assets of EIX Trust I (the "Trust"). Each Series A QUIPS will entitle the
holder to receive quarterly cash distributions as described in this prospectus
supplement. The Trust is offering 20,000,000 Series A QUIPS at a price of $25
for each Series A QUIPS.
Who is the Trust?
The Trust is a Delaware business trust. Its principal offices are located
at 2244 Walnut Grove Avenue, Rosemead, California 91770 and the telephone
number is (626) 302-1930.
The Trust will sell its Series A QUIPS to the public and its Series A
common securities (the "Series A Common Securities") to Edison International.
The Trust will use the proceeds from these sales to buy the % Subordinated
Deferrable Interest Notes, Series A due , 2029 (QUIDS(SM)) (the "Series A
QUIDS") from Edison International with the same financial terms as the Series A
QUIPS. Edison International will guarantee payments made on the Series A QUIPS
as described below.
The Chase Manhattan Bank will act as property trustee (the "Property
Trustee") of the Trust. Three officers of Edison International also will act as
trustees (the "Regular Trustees") of the Trust. Chase Manhattan Bank Delaware
will be an additional trustee (the "Delaware Trustee") of the Trust. The Chase
Manhattan Bank also will act as trustee (the "Subordinated Indenture Trustee")
under the Subordinated Indenture, as supplemented (the "Subordinated
Indenture"), pursuant to which the Series A QUIDS will be issued and will act
as trustee (the "Guarantee Trustee") under a Guarantee Agreement with Edison
International in respect of the Series A QUIPS (the "Series A QUIPS
Guarantee"). The Property Trustee, Delaware Trustee and Regular Trustees are
sometimes referred to as the "Securities Trustees."
Who is Edison International?
Edison International was incorporated on April 20, 1987, under the laws of
the State of California for the purpose of becoming the parent holding company
of Southern California Edison Company, a California public utility corporation.
As of December 31, 1998, Edison International owned all of the issued and
outstanding common stock of Southern California Edison Company and of the
following subsidiaries engaged in nonutility businesses: Edison Mission Energy,
Edison Capital, Mission Land Company and Edison Enterprises. The principal
executive offices of Edison
S-2
<PAGE>
International are located at 2244 Walnut Grove Avenue, Rosemead, California
91770, and its telephone number is (626) 302-2222.
When will you receive quarterly distributions?
If you purchase the Series A QUIPS, you are entitled to receive cumulative
cash distributions at an annual rate of % of the liquidation amount of $25 per
Series A QUIPS. Distributions will accumulate from the date the Trust first
issues the Series A QUIPS and will be paid quarterly in arrears on August 31,
November 30, February 28 and May 31 of each year, beginning August 31, 1999.
When can payment of your distributions be deferred?
So long as no event of default under the Subordinated Indenture
("Subordinated Indenture Event of Default") has occurred and is continuing,
Edison International can, on one or more occasions, defer interest payments on
the Series A QUIDS for up to 20 consecutive quarterly periods. A deferral of
interest payments cannot extend, however, beyond the maturity date of the
Series A QUIDS, which is , 2029, subject to extension rights as described
below.
If Edison International defers interest payments on the Series A QUIDS, the
Trust will also defer distributions on the Series A QUIPS. During this deferral
period, distributions will continue to accumulate on the Series A QUIPS at an
annual rate of % of the liquidation amount of $25 per Series A QUIPS. Also,
the deferred distributions will themselves accumulate additional distributions,
compounded quarterly, at an annual rate of %, to the extent permitted by law.
If Edison International makes all deferred interest payments on the Series A
QUIDS, with accrued interest, it can again defer interest payments on the
Series A QUIDS.
During any period in which Edison International defers interest payments on
the Series A QUIDS, with limited exceptions, Edison International will not be
permitted to:
. pay a dividend or make any distributions on its capital stock or redeem,
purchase, acquire or make a liquidation payment on any of its capital
stock; or
. make an interest, principal or premium payment on, or repurchase or
redeem, any of its debt securities that rank equally with or junior to
the Series A QUIDS, or make any guarantee payments with respect to any
guarantee by it of debt securities of any of its subsidiaries if the
guarantee is equal to or junior in right of payment to the Series A
QUIDS.
If Edison International defers payments of interest on the Series A QUIDS,
the Series A QUIDS will, from the time of deferral, be treated as having been
reissued with original issue discount ("OID") for United States federal income
tax purposes. This means that you will be required to accrue interest income
and include the amounts of this income in your gross income for United States
federal income tax purposes even though you will not have received any cash
distributions relating to this interest income, and even though you may use the
cash method of accounting. See "Material United States Federal Income Tax
Considerations--Interest Income and Original Issue Discount" in this prospectus
supplement.
When can the Trust redeem the Series A QUIPS?
The Trust must redeem all of the outstanding Series A QUIPS and Series A
Common Securities when the Series A QUIDS are paid at maturity on , 2029,
which maturity may be extended as described below. In addition, if Edison
International redeems any Series A QUIDS before their
S-3
<PAGE>
maturity, the Trust will use the cash it receives from the redemption to
redeem, on a pro rata basis, Series A QUIPS and Series A Common Securities
(collectively, the "Series A Trust Securities") having a combined liquidation
amount equal to the principal amount of the Series A QUIDS redeemed.
Edison International can redeem some or all of the Series A QUIDS before
their maturity at 100% of their principal amount on one or more occasions any
time on or after , 2004. Edison International also has the option to redeem
the Series A QUIDS, in whole, but not in part, at any time if specific changes
in tax or investment company law occur and other conditions are satisfied, as
more fully described under "Description of the Series A QUIDS--Optional
Redemption." In any case, Edison International will pay accrued interest to the
date of redemption.
What is Edison International's guarantee of the Series A QUIPS?
Edison International will guarantee the Series A QUIPS based on:
. the Series A QUIPS Guarantee, which guarantees the Trust's obligation to
pay distributions on the Series A QUIPS; and
. its obligations under the Amended and Restated Trust Agreement of the
Trust (the "Trust Agreement") and the Agreement as to Expenses and
Liabilities between Edison International and the Trust (the "Expense
Agreement").
The payment of distributions on the Series A QUIPS is guaranteed by Edison
International under the Series A QUIPS Guarantee, but only to the extent the
Trust has funds legally and immediately available to make distributions. See
"Description of Preferred Securities Guarantees," "Description of Expense
Agreements" and "Relationship among Preferred Securities, Preferred Securities
Guarantees and Subordinated Debt Securities Held by Each Trust" in the
accompanying prospectus.
Edison International's obligations under the Series A QUIPS Guarantee are:
. subordinate and junior in right of payment to all of its other
liabilities, except those that rank equally or are subordinate by their
terms; and
. equal in rank with any other preferred securities guarantee similar to
the Series A QUIPS Guarantee issued by Edison International on behalf of
the holders of preferred securities issued by any other trust established
by Edison International or its affiliates.
When could the Series A QUIDS be distributed to you?
Edison International has the right to terminate the Trust at any time. If
Edison International terminates the Trust, the Trust will liquidate by
distributing the Series A QUIDS to holders of the Series A Trust Securities on
a pro rata basis. If the Series A QUIDS are distributed, Edison International
will use its best efforts to list the Series A QUIDS on the New York Stock
Exchange or any other exchange on which the Series A QUIPS are then listed in
place of the Series A QUIPS. For a discussion of Edison International's ability
to distribute the Series A QUIDS, see "Description of the Series A QUIPS--
Exchange of Series A QUIPS for Series A QUIDS" in this prospectus supplement
and "Description of Preferred Securities--Liquidation Distribution upon
Dissolution" in the accompanying prospectus.
Will the Series A QUIPS be listed on a stock exchange?
Application has been made to list the Series A QUIPS on the New York Stock
Exchange. If approved, trading of the Series A QUIPS is expected to begin
within 30 days after they are first issued.
S-4
<PAGE>
Will holders of the Series A QUIPS have any voting rights?
Generally, the holders of the Series A QUIPS will not have any voting
rights. See "Description of Preferred Securities--Voting Rights; Amendment of
Trust Agreement" in the accompanying prospectus.
In what form will the Series A QUIPS be issued?
The Series A QUIPS will be represented by one or more global securities
that will be deposited with and registered in the name of The Depositary Trust
Company or its nominee. This means that you will not receive a certificate for
your Series A QUIPS and that your broker will maintain your position in the
Series A QUIPS. Edison International expects that the Series A QUIPS will be
ready for delivery through The Depository Trust Company on or about , 1999.
S-5
<PAGE>
RISK FACTORS
Your investment in the Series A QUIPS will involve risks. You should
carefully consider the following discussion of risks, and the other information
in this prospectus supplement and the accompanying prospectus (including the
documents incorporated by reference in the prospectus), before deciding whether
an investment in the QUIPS is suitable for you.
Edison International's Obligations under the Series A QUIDS and the Series A
QUIPS Guarantee are Deeply Subordinated.
Edison International's obligations under the Series A QUIDS are unsecured
and will rank junior in priority of payment to all of Edison International's
other liabilities except those that rank equally or are subordinate by their
terms ("senior debt"). Edison International's obligations under the Series A
QUIPS Guarantee are unsecured and will rank in priority of payment as follows:
. subordinate and junior in right of payment to its senior debt; and
. equal in rank with any other preferred securities guarantee similar to
the Series A QUIPS Guarantee hereafter issued by Edison International on
behalf of the holders of preferred securities issued by any other trust
established by Edison International or its affiliates.
This means that Edison International cannot make any payments on the Series
A QUIDS or the Series A QUIPS Guarantee if it defaults on a payment of senior
debt and does not cure that default within the applicable grace period or if
any senior debt becomes immediately due because of a default and has not yet
been paid in full. In addition, in the event of the bankruptcy, liquidation or
dissolution of Edison International, its assets would be available to pay
obligations under the Series A QUIDS or the Series A QUIPS Guarantee only after
Edison International made all payments on its senior debt.
Because Edison International is a holding company, Edison International's
right to participate in any asset distribution of any of its subsidiaries, on
liquidation, reorganization or otherwise, will rank junior to the rights of all
creditors of that subsidiary (except to the extent that Edison International
may itself be a creditor of that subsidiary). The rights of holders of the
Series A QUIPS or Series A QUIDS to benefit from those distributions will also
be junior to those prior claims. Consequently, the Series A QUIDS (and,
therefore, the Series A QUIPS) will be effectively subordinated to all
liabilities of Edison International's subsidiaries. You should look only to the
assets of Edison International for payments on the Series A QUIDS (and the
Series A QUIPS).
At March 31, 1999, Edison International had total liabilities of
approximately $21.217 billion. Of this amount, approximately $6.770 billion
would be Senior Debt (as defined below) of Edison International or liabilities
of its subsidiaries that would effectively rank senior to the Series A QUIDS.
During the second quarter of 1999, Edison International's subsidiaries issued
the following additional Senior Debt:
. $300 million of 6.65% notes due 2029 in April 1999
. $120 million of 6.0% preferred securities in May 1999
. $600 million of 7.73% senior notes due 2009 in June 1999
None of the Series A QUIPS, the Series A QUIDS nor the Series A QUIPS
Guarantee limits the ability of Edison International to incur additional
indebtedness, including indebtedness that will rank senior in priority of
payment to the Series A QUIDS or the Series A QUIPS Guarantee. We expect that
Edison International and its subsidiaries may incur substantial additional
amounts of indebtedness in the future.
S-6
<PAGE>
The Series A QUIPS Guarantee Only Covers Payments if the Trust Has Cash
Available, but You May Sue Edison International Directly.
The ability of the Trust to pay scheduled distributions on the Series A
QUIPS, the redemption price of the Series A QUIPS and the liquidation amount of
each Series A QUIPS is solely dependent upon Edison International making the
related payments on the Series A QUIDS when due.
If Edison International defaults on its obligations to pay principal or
interest on the Series A QUIDS, the Trust will not have sufficient funds to pay
distributions on, or the redemption price or liquidation amount of, each Series
A QUIPS. In those circumstances, you will not be able to rely upon the Series A
QUIPS Guarantee for payment of these amounts.
Instead, you:
. may directly sue Edison International or seek other remedies to collect
your pro rata share of payments owed; or
. may rely on the Property Trustee to enforce the Trust's rights under the
Series A QUIDS.
Deferral of Distributions Would Have Tax Consequences for You and May Affect
the Trading Price of the Series A QUIPS.
So long as no Subordinated Indenture Event of Default has occurred and is
continuing, Edison International can, on one or more occasions, defer interest
payments on the Series A QUIDS for up to 20 consecutive quarterly periods. If
Edison International defers interest payments on the Series A QUIDS, the Trust
will defer distributions on the Series A QUIPS during any deferral period.
However, distributions would still accumulate and such deferred distributions
would themselves accumulate additional distributions, compounded quarterly, at
the annual rate of % per annum, to the extent permitted by law.
If Edison International defers payments of interest on the Series A QUIDS,
you will be required to include interest income in gross income for United
States federal income tax purposes in the form of OID, based on your pro rata
share of the deferred interest on the Series A QUIDS held by the Trust, before
you receive any cash relating to your interest, even if you use the cash method
of accounting. In addition, you will not receive this cash if you sell the
Series A QUIPS before the end of any deferral period or before the record date
relating to distributions which are paid.
Edison International has no current intention of deferring interest
payments on the Series A QUIDS. However, if Edison International exercises its
right in the future, the Series A QUIPS may trade at a price that does not
fully reflect the value of accrued but unpaid interest on the Series A QUIDS.
If you sell the Series A QUIPS during an interest deferral period, you may not
receive the same return on investment as someone else who continues to hold the
Series A QUIPS. In addition, the existence of Edison International's right to
defer payments of interest on the Series A QUIDS may mean that the market price
for the Series A QUIPS, which represent an undivided beneficial interest in the
Series A QUIDS, may be more volatile than other securities that do not have
these rights.
See "Material United States Federal Income Tax Considerations" in this
prospectus supplement for more information regarding the tax consequences of
purchasing, holding and selling the Series A QUIPS.
Series A QUIPS May Be Redeemed at Any Time if Adverse Changes in Tax or
Investment Company Law Occur.
If Edison International receives an opinion of counsel that adverse changes
in tax or investment company law have occurred or will occur, and other
conditions are satisfied, Edison International has
S-7
<PAGE>
the right to redeem the Series A QUIDS, in whole, but not in part, at any time
within 90 days of receipt of such opinion. Any such redemption will cause a
mandatory redemption of all Series A QUIPS and Series A Common Securities at a
redemption price equal to $25 per security plus any accrued and unpaid
distributions. See "Description of the Series A QUIDS--Optional Redemption" in
this prospectus supplement.
The Series A QUIDS, and Therefore the Series A QUIPS, May Be Redeemed at Par at
the Option of Edison International Five Years after Issuance.
At the option of Edison International, the Series A QUIDS may be redeemed,
in whole, at any time, or in part, from time to time, on or after , 2004, at
a redemption price equal to the principal amount to be redeemed plus any
accrued and unpaid interest to the date of redemption. See "Description of the
Series A QUIDS--Optional Redemption" in this prospectus supplement. You should
assume that Edison International will exercise its redemption option if Edison
International is able to refinance at a lower interest rate or it is otherwise
in the interest of Edison International to redeem the Series A QUIDS. If the
Series A QUIDS are redeemed, the Trust must redeem the Series A Trust
Securities having an aggregate liquidation amount equal to the aggregate
principal amount of Series A QUIDS to be redeemed. See "Description of the
Series A QUIPS--Redemption" in this prospectus supplement.
Edison International May Change the Stated Maturity of the Series A QUIDS
As long as certain conditions are met, Edison International will have the
right to extend the stated maturity of the Series A QUIDS--and therefore the
mandatory redemption date of the Series A QUIPS--to , 2048. You should
assume that Edison International will exercise its option to extend the stated
maturity if Edison International is unable to refinance at a lower interest
rate or it is in the interest of Edison International to defer the stated
maturity of the Series A QUIDS. Consequently, you may have to wait nineteen
years beyond the initial stated maturity before the Trust redeems the Series A
QUIPS. See "Description of the Series A QUIDS--Stated Maturity" in this
prospectus supplement.
There Can Be No Assurance as to the Market Prices for the Series A QUIPS or the
Series A QUIDS.
There can be no assurance as to the market prices for the Series A QUIPS or
the Series A QUIDS that may be distributed in exchange for Series A QUIPS upon
a termination of the Trust. Accordingly, the Series A QUIPS that you purchase,
whether pursuant to the offer made by this prospectus supplement or in the
secondary market, or the Series A QUIDS that you may receive upon a termination
of the Trust, may trade at a discount to the price that you paid to purchase
the Series A QUIPS offered by this prospectus supplement. As a result of Edison
International's right to defer interest payments on the Series A QUIDS, the
market price of the Series A QUIPS, which represent undivided beneficial
ownership interests in the Trust, substantially all the assets of which consist
of the Series A QUIDS, may be more volatile than the market prices of other
securities that are not subject to such optional deferrals.
Edison International May Terminate the Trust at Any Time.
Edison International has the right to terminate the Trust at any time. If
Edison International decides to exercise its right to terminate the Trust, the
Trust will liquidate by distributing the Series A QUIDS to holders of the
Series A QUIPS and the Series A Common Securities on a pro rata basis.
Under current United States federal income tax law and interpretations and
assuming, as we expect, that the Trust will not be classified as an association
taxable as a corporation, you would not be taxed if the Property Trustee
distributes the Series A QUIDS to you upon liquidation of the Trust.
S-8
<PAGE>
However, if a Tax Event (as defined below) were to occur and the Trust were
subject to taxation on income received or accrued on the Series A QUIDS, you
and the Trust could be taxed on that distribution.
Edison International has no current intention of causing the termination of
the Trust and the distribution of the Series A QUIDS. Edison International
anticipates that it would consider exercising this right in the event that
expenses associated with maintaining the Trust were substantially greater than
currently expected such as if specific changes in tax law or investment company
law occurred. See "Description of the Series A QUIPS--Exchange of Series A
QUIPS for Series A QUIDS" in this prospectus supplement and "Description of
Preferred Securities--Liquidation Distribution upon Dissolution" in the
accompanying prospectus. Edison International cannot predict the other
circumstances under which this right would be exercised.
Although Edison International intends to use its best efforts to list the
Series A QUIDS on the New York Stock Exchange or any other exchange on which
the Series A QUIPS are then listed if they are distributed, we cannot assure
you that the Series A QUIDS will be approved for listing or that a trading
market will exist for those securities.
You Have Limited Voting Rights.
You will have limited voting rights in respect of the Series A QUIPS. In
particular, subject to specific exceptions, only Edison International can
appoint or remove any of the Securities Trustees. See "Description of Preferred
Securities--Voting Rights; Amendment of Trust Agreement" in the accompanying
prospectus.
There Has Been No Prior Market for the Series A QUIPS.
Before this offering, there has been no market for the Series A QUIPS.
Although the Trust has applied to list the Series A QUIPS on the New York Stock
Exchange, a listing does not guarantee that a trading market for the Series A
QUIPS will develop or, if a trading market for the Series A QUIPS does develop,
the depth of that market and the ability of the holders to easily sell their
Series A QUIPS.
ACCOUNTING TREATMENT
For financial reporting purposes, the Trust will be treated as a subsidiary
of Edison International and, accordingly, the accounts of the Trust will be
included in the consolidated financial statements of Edison International. The
Series A QUIPS will be included in the "Preferred securities of subsidiaries
not subject to mandatory redemption" line on the consolidated balance sheet of
Edison International and also in the table of preferred securities in Note 4 of
the "Notes to Consolidated Financial Statements." For financial reporting
purposes, distributions payable on the Series A QUIPS will be included in the
"Dividends on subsidiary preferred securities" line on the consolidated
statement of income of Edison International.
USE OF PROCEEDS
The Trust will invest all of the proceeds from the sale of Series A QUIPS
in the Series A QUIDS. Assuming an initial offering price equal to the
liquidation amount of the Series A QUIPS, we estimate such proceeds to be
approximately $500,000,000 (or $575,000,000, if the Underwriters' overallotment
option is exercised in full). We estimate that the expenses for this offering,
excluding underwriting discounts and commissions, will be approximately
$1,149,000. Edison International and/or its subsidiaries will use the net
proceeds from the sale of the Series A QUIDS for general corporate purposes,
including investing in nonutility business activities and reducing short-term
debt incurred to provide interim financing for such purposes.
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DESCRIPTION OF THE SERIES A QUIPS
This section describes the specific terms of the Series A QUIPS. This
description supplements, and should be read together with, the description of
the general terms and provisions of the Series A QUIPS set forth in the
accompanying prospectus under the caption "Description of Preferred
Securities." The following description does not purport to be complete and is
subject to, and is qualified in its entirety by reference to, the description
in the accompanying prospectus and the Trust Agreement. We have filed a form of
the Trust Agreement as an exhibit to the Registration Statement of which the
accompanying prospectus is a part.
General
The Trust will issue the Series A QUIPS and the Series A Common Securities,
with a stated liquidation amount of $25 per security. The Series A QUIPS and
the Series A Common Securities will rank equally with one another. The Trust
will make payments on the Series A QUIPS pro rata with the Series A Common
Securities, except as described in "--Ranking" below.
The Trust will use the proceeds from the sale of the Series A Trust
Securities to purchase the Series A QUIDS from Edison International. The
Property Trustee will hold legal title to the Series A QUIDS in trust for the
benefit of the holders of the Series A Trust Securities. Edison International
will guarantee the payment of distributions and other amounts payable on the
Series A QUIPS, but only to the extent that the Trust has funds legally and
immediately available to make those payments. See "Description of Preferred
Securities Guarantees" in the accompanying prospectus.
The Trust Agreement will be qualified as an indenture under the Trust
Indenture Act. The Property Trustee will act as indenture trustee for the
Series A QUIPS, in order to comply with the provisions of the Trust Indenture
Act.
The Series A QUIPS will be represented by a global security that will be
deposited with and registered in the name of The Depository Trust Company
("DTC") or its nominee. Whenever we refer to a "holder" of Series A QUIPS in
this prospectus supplement, we mean the registered holder, which, for any
Series A QUIPS in book-entry form, will be DTC or its nominee. We discuss
various matters relevant to global securities under "Book-Entry Issuance" in
this prospectus supplement.
Distributions
Distributions will accumulate on the Series A QUIPS from the date they are
first issued at the annual rate of % of their liquidation amount. Unless
deferred as described below, distributions will be payable quarterly in arrears
on August 31, November 30, February 28 and May 31 of each year (each, a
"distribution date"), beginning August 31, 1999. Distributions not paid when
due will accumulate additional distributions, compounded quarterly, at the
annual rate of % on the amount of unpaid distributions, to the extent
permitted by law. Whenever we use the term "distributions" in this prospectus
supplement, we are including any of these distributions. The amount of
distributions payable for any period will be computed on the basis of a 360-day
year of twelve 30-day months.
The assets of the Trust available for distributions to holders of Series A
QUIPS will be limited to the interest payments the Trust receives from Edison
International in respect of the Series A QUIDS. Consequently, if Edison
International defers or for any other reason fails to make interest payments on
the Series A QUIDS, the Trust will not have funds to pay distributions on the
Series A QUIPS.
As long as no Subordinated Indenture Event of Default has occurred and has
not been cured, Edison International will have the right to defer interest
payments on the Series A QUIDS at any time. Edison International may do so in
each case for a period not exceeding 20 consecutive
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quarters (each, an "extension period"). No extension period may extend beyond
the stated maturity of the Series A QUIDS. Before an extension period ends,
Edison International may extend it further if that extension period does not
exceed 20 consecutive quarters or extend beyond the stated maturity of the
Series A QUIDS. When an extension period ends and Edison International has paid
all accrued and unpaid interest on the Series A QUIDS, Edison International may
begin a new extension period, subject to the terms described above. There is no
limit on the number of extension periods that Edison International may begin.
If Edison International defers interest payments on the Series A QUIDS, the
Trust also will defer the payment of distributions on the Series A QUIPS.
During an extension period, you will still accumulate distributions at the rate
stated above, plus you will accumulate additional distributions on the deferred
distributions at the same rate, to the extent permitted by law. During an
extension period, you will be required to accrue interest income for United
States federal income tax purposes. See "Material United States Federal Income
Tax Considerations--Interest Income and Original Issue Discount" in this
prospectus supplement.
Edison International has no current intention to exercise its right to
defer interest payments on the Series A QUIDS. If Edison International elects
to begin an extension period, it will be subject to specified restrictions
relating to paying dividends on or repurchasing its common stock and making
payments on certain of its debt securities. See "Description of the Series A
QUIDS--Interest--Extension Period Restrictions" in this prospectus supplement.
Redemption
The Series A QUIPS will remain outstanding until the Trust redeems them or
distributes the Series A QUIDS in exchange for the Series A QUIPS. Any
redemption of Series A QUIPS must occur as described below. Any exchange
distribution must occur as described below in "--Exchange of Series A QUIPS for
Series A QUIDS."
Redemption of Series A Trust Securities
If Edison International repays or redeems the Series A QUIDS, whether at
their stated maturity, upon acceleration after a Subordinated Indenture Event
of Default or upon early redemption, the Property Trustee will redeem a Like
Amount of Series A Trust Securities on the Redemption Date at the Redemption
Price. In this context, "Like Amount" means Series A Trust Securities having an
aggregate liquidation amount equal to the aggregate principal amount of the
Series A QUIDS being repaid or redeemed. "Redemption Date" means the date that
the principal of those Series A QUIDS becomes due for payment under the
Subordinated Indenture. "Redemption Price" means the aggregate liquidation
amount of the Series A Trust Securities to be redeemed, plus any accumulated
and unpaid distributions on those securities to the Redemption Date.
Repayment and Redemption of Series A QUIDS
The Series A QUIDS initially will have a stated maturity of , 2029,
which Edison International may shorten to a date on or after , 2014, or,
subject to certain conditions being satisfied, extend to , 2048. See
"Description of the Series A QUIDS--Stated Maturity" in this prospectus
supplement.
Edison International also may redeem the Series A QUIDS, at its option,
before their stated maturity as follows:
. at any time on or after , 2004, in whole or in part, provided that no
partial redemption may occur during an extension period, and
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. at any time in whole, but not in part, within 90 days after a Tax Event
or an Investment Company Act Event has occurred.
Please see "Description of Series A QUIDS--Optional Redemption" in this
prospectus supplement for the definitions of "Tax Event" and "Investment
Company Act Event."
If a Tax Event is continuing and Edison International does not elect to
redeem the Series A QUIDS or liquidate the Trust, Edison International may be
required to pay additional sums on the Series A QUIDS. The provisions regarding
repayment and redemption of the Series A QUIDS, as well as information about
the effect that possible tax law changes may have on the Series A QUIDS and
Series A QUIPS, are discussed in "Description of the Series A QUIDS--Stated
Maturity," "--Optional Redemption" and "--Payment of Additional Sums" in this
prospectus supplement.
Redemption Procedures
The Property Trustee will give you at least 30 days, but not more than 60
days, notice before the Redemption Date, unless the redemption results from
acceleration after a Subordinated Indenture Event of Default and the Property
Trustee is not able to give notice during this period. In that case, the
Property Trustee will give the notice as soon as practicable. The Property
Trustee will give the notice of redemption in the manner described below under
"--Notices."
The Property Trustee will irrevocably deposit with DTC (in the case of any
book-entry Series A QUIPS) or the Paying Agent (as defined below) (in the case
of any non-book-entry Series A QUIPS) funds sufficient to pay the Redemption
Price for all Series A Trust Securities being redeemed on that date, to the
extent that funds are available to the Property Trustee. The Property Trustee
will deposit such funds by 2:00 p.m., New York City time, on the Redemption
Date.
DTC will pay the Redemption Price for Series A QUIPS held in book-entry
form and called for redemption in accordance with the procedures of DTC, to the
extent the Property Trustee has deposited sufficient funds with DTC. The Paying
Agent will pay the Redemption Price for Series A QUIPS held in certificated
form and called for redemption, to the extent the Property Trustee has
deposited sufficient funds with the Paying Agent, against surrender of the
certificates representing those Series A QUIPS. Any distributions that are due
on a distribution date that is on or before the Redemption Date will be payable
to the holders of those Series A QUIPS on the record date for the related
distribution date.
Once the Property Trustee gives notice of redemption and deposits funds as
discussed above, all rights of the holders of the Series A Trust Securities
called for redemption will cease at the time of the deposit, except the right
of those holders to receive the Redemption Price, but without interest on that
amount. In addition, those Series A Trust Securities will no longer be
outstanding.
On the Redemption Date, distributions will stop accumulating on the Series
A QUIDS called for redemption. However, if payment of the Redemption Price for
any Series A Trust Securities is not made, distributions on the Series A QUIPS
will continue to accumulate to the date the Redemption Price is paid.
If the Trust redeems less than all the Series A Trust Securities, then the
liquidation amount of Series A Trust Securities to be redeemed will be
allocated pro rata between the outstanding Series A QUIPS and the outstanding
Series A Common Securities, based upon their respective liquidation amounts.
Within 60 days of the Redemption Date, the Property Trustee will select the
Series A Trust Securities to be redeemed from among the outstanding Series A
Trust Securities not previously called for redemption. The Property Trustee may
use any method of selection that it deems to be fair and appropriate.
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Other Purchases of Series A QUIPS
Edison International or its subsidiaries may purchase outstanding Series A
QUIPS by tender, in the open market or by private agreement, subject to
applicable laws, including United States federal securities laws.
Exchange of Series A QUIPS for Series A QUIDS
Edison International will have the right at any time, in its sole
discretion, to terminate the Trust. After the Trust has satisfied all
liabilities to its creditors, as provided by law, the Property Trustee will
distribute a Like Amount of Series A QUIDS to the holders of the Series A Trust
Securities in exchange for all the outstanding Series A Trust Securities, in
liquidation of the Trust. In this context, "Like Amount" means Series A QUIDS
having an aggregate principal amount equal to the aggregate liquidation amount
of all outstanding Series A Trust Securities.
Edison International must use its best efforts to list the Series A QUIDS
on the New York Stock Exchange or such other stock exchange or organization, if
any, on which the Series A QUIPS are listed if an exchange distribution occurs.
Exchange Procedures
The Property Trustee will make the exchange distribution to holders of
Series A QUIPS listed in the Trust's records at the close of business on the
record date for the exchange distribution. If the Series A QUIPS are held in
book-entry form, the record date will be one Business Day (as defined below)
before the date that Edison International sets as the exchange distribution
date (the "Exchange Date"). If the Series A QUIPS are not held in book-entry
form, the record date will be the 15th day (whether or not a Business Day)
before the Exchange Date.
The Property Trustee will give you at least 30 days, but not more than 60
days, notice before the Exchange Date. The Property Trustee will give the
notice of an Exchange Date in the manner described below under "--Notices."
On the Exchange Date:
. the Series A QUIPS will no longer be outstanding,
. certificates representing a Like Amount of Series A QUIDS will be issued
to holders of Series A QUIPS upon their surrender to the Property Agent
or its agent for exchange,
. any certificates representing Series A QUIPS that are not surrendered
for exchange will be deemed to represent a Like Amount of Series A QUIDS
(and until such certificates are surrendered for exchange, no payments
of interest or principal on such Series A QUIDS will be made to the
holders of those Series A QUIPS), and
. the holders of Series A QUIPS will not have any further rights with
respect to the Series A QUIPS, except the right to receive certificates
representing Series A QUIDS upon surrender of their certificates as
described above.
Certain Tax Consequences
Under current United States federal income tax law and interpretations and
assuming, as we expect, that the Trust will not be classified as an association
taxable as a corporation, you would not be taxed if the Property Trustee
distributes the Series A QUIDS to you upon liquidation of the Trust. However,
if a Tax Event were to occur and the Trust were subject to taxation on income
received or accrued on the Series A QUIDS, you and the Trust could be taxed on
that distribution. See "Material
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United States Federal Income Tax Considerations--Distribution of Series A QUIDS
to Holders of Series A QUIPS Upon Liquidation of the Trust" in this prospectus
supplement.
Ranking
The Series A QUIPS will rank equally with the Series A Common Securities.
The Trust will make payments of distributions and the Redemption Price on the
Series A QUIPS and the Series A Common Securities pro rata, based on the
liquidation amounts of the Series A QUIPS and Series A Common Securities,
except as follows. If a Subordinated Indenture Event of Default has occurred
and has not been cured, the Trust will not make any payments on the Series A
Common Securities until the Trust has paid in full or provided in full all
unpaid amounts on the Series A QUIPS.
If a Subordinated Indenture Event of Default occurs, the holders of the
Series A Common Securities will be deemed to have waived all rights to act with
respect to the related Trust Agreement Event of Default (as defined below)
until all such Trust Agreement Events of Default have been cured, waived or
eliminated. Until any such Trust Agreement Events of Default have been cured,
waived or eliminated, the Property Trustee will act solely on your behalf (and
not on behalf of the holders of the Series A Common Securities), and only you
will have the right to direct the Property Trustee to act on your behalf.
Trust Agreement Events of Default
The term "Trust Agreement Event of Default" means any of the following:
. a Subordinated Indenture Event of Default occurs (see "Description of
Debt Securities--Events of Default" in the accompanying prospectus),
. the Property Trustee does not pay any distribution within 30 days of its
due date, provided that no extension period is continuing,
. the Property Trustee does not pay any Redemption Price on its due date,
. the Securities Trustees remain in breach in a material respect of any
term of the Trust Agreement for 90 days after the Securities Trustees
receive notice of default stating the trustees are in breach. The notice
must be sent by the holders of at least 25% in liquidation amount of the
outstanding Series A QUIPS, or
. the Property Trustee files for bankruptcy or certain other events in
bankruptcy or insolvency occur and a successor Property Trustee is not
appointed within 60 days.
Within 90 days after learning of a Trust Agreement Event of Default, the
Property Trustee will notify the holders of the Series A Trust Securities, the
Regular Trustees and Edison International, unless the Trust Agreement Event of
Default has been cured or waived.
Edison International and the Regular Trustees must provide the Property
Trustee with an annual certificate stating whether they are in compliance with
all the conditions and covenants applicable to them under the Trust Agreement.
If a Trust Agreement Event of Default has occurred and has not been cured,
the Series A QUIPS will have a preference in right of payment over the Series A
Common Securities as discussed above. The holders of Series A Trust Securities
are not entitled to accelerate the maturity of the Series A QUIPS upon a Trust
Agreement Event of Default.
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Enforcement Rights
If a Subordinated Indenture Event of Default occurs, the holders of Series
A QUIPS must rely on the Property Trustee, as the holder of the Series A QUIDS,
to enforce its rights under the Series A QUIDS and the Subordinated Indenture
against Edison International, subject to the following:
Right of Direct Action
If Edison International does not make full and timely payments on the
Series A QUIDS, the Trust will not have funds available to make payments of
distributions or other amounts due on the Series A QUIPS. In this event, a
holder of Series A QUIPS may sue Edison International directly to collect its
pro rata share of payments owed. Edison International may not amend the
Subordinated Indenture to remove the right of any holder of Series A QUIPS to
bring a direct action against Edison International without the prior written
consent of all of the holders of Series A QUIPS. Edison International will be
able to set-off any payment made to a holder of Series A QUIPS in connection
with a direct action.
Other Rights under the Subordinated Indenture
The holders of 25% or more in liquidation amount of the outstanding Series
A QUIPS may accelerate the maturity of the Series A QUIDS when a Subordinated
Indenture Event of Default has occurred and has not been cured and neither the
Subordinated Indenture Trustee nor the holders of the Series A QUIDS have
exercised such acceleration rights. In addition, the holders of a majority in
liquidation amount of the outstanding Series A QUIPS may cancel a declaration
of acceleration of the Series A QUIDS and may waive specified Subordinated
Indenture Events of Default. See "Description of Debt Securities--Remedies" in
the accompanying prospectus.
Notices
Notices to be given to holders of Series A QUIPS held in book-entry form
will be given to DTC in accordance with its procedures. Notices to be given to
holders of Series A QUIPS held in certificated form may be given by mail to
their addresses set forth in the Trust's records.
Payment and Paying Agency
If the Series A QUIPS are held in book-entry form, distributions will be
paid to DTC, which will credit the relevant accounts at DTC on the applicable
distribution dates in accordance with its procedures. If the Series A QUIPS are
issued in certificated form, distributions will be paid by check mailed to the
address of the holder entitled to such payments, as such address appears in the
Trust's records. The paying agent of the Trust (the "Paying Agent") will
initially be the Property Trustee. Any Paying Agent may resign upon 30 days'
written notice to the Regular Trustees and the Property Trustee. In such event,
the Property Trustee will appoint a successor acceptable to the Regular
Trustees to act as Paying Agent.
Persons holding their Series A QUIPS in "Street Name" or indirectly through
DTC should consult their banks or brokers for information on how they will
receive payments. See "Book-Entry Issuance--"Street Name' and Other Indirect
Holders" in this prospectus supplement.
Any money paid to the Property Trustee or any Paying Agent for payments on
the Series A QUIPS that remains unclaimed at the end of two years after the
amount is due will be repaid to Edison International. After that two-year
period, you may look only to Edison International for payment of those amounts.
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Business Day
If any payment is due on a day that is not a Business Day, the payment will
be made on the following Business Day (unless that Business Day is in a
different calendar year, in which case the payment will be made on the
preceding Business Day). Each payment made on the following or preceding
Business Day will have the same force and effect as if made on the original
payment due date. "Business Day" means any day other than a Saturday, a Sunday,
a day on which banking institutions in New York City or Los Angeles, California
are authorized or required by law or executive order to remain closed or a day
on which the corporate trust office of the Property Trustee or the Subordinated
Indenture Trustee is closed for business.
Record Date
The Trust will pay distributions to holders of Series A QUIPS listed in the
Trust's records on the record date for the payment. If the Series A QUIPS are
held in book-entry form, the record date will be one Business Day before the
relevant distribution date. If the Series A QUIPS are issued in certificated
form, the record date will be the 15th day, whether or not a Business Day,
before the relevant distribution date.
Registrar and Transfer Agent
The Property Trustee will initially act as the Trust's agent for
registering Series A QUIPS in the names of holders and transferring Series A
QUIPS. The Property Trustee also will perform the role of maintaining the list
of registered holders of Series A QUIPS. Holders will not be required to pay a
service charge to transfer or exchange Series A QUIPS, but may be required to
pay for any tax or other governmental charge associated with the exchange or
transfer.
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DESCRIPTION OF THE SERIES A QUIDS
This section describes the specific terms of the Series A QUIDS. This
description supplements, and should be read together with, the description of
the general terms and provisions of the Series A QUIDS set forth in the
accompanying prospectus under the caption "Description of Debt Securities." The
following description does not purport to be complete and is subject to, and is
qualified in its entirety by reference to, the description in the accompanying
prospectus and the Subordinated Indenture. We have filed a form of the
Subordinated Indenture (including a form of supplemental indenture) as an
exhibit to the Registration Statement of which the accompanying prospectus is a
part.
General
Edison International will issue Series A QUIDS in denominations that are
integral multiples of $25 and in an aggregate principal amount of $515,464,000
($592,783,600, if the Underwriters' overallotment option is exercised in full).
The Trust will use the proceeds from the sale of the Series A QUIPS to purchase
the Series A QUIDS. The Property Trustee will hold legal title to the Series A
QUIDS in trust for the benefit of the holders of the Series A Trust Securities.
The Subordinated Indenture will be qualified as an indenture under the
Trust Indenture Act. The Subordinated Indenture Trustee will act as indenture
trustee for the Series A QUIDS, in order to comply with the provisions of the
Trust Indenture Act.
The Series A QUIDS are not secured by any property or assets of Edison
International. The Series A QUIDS will rank junior in priority of payment to
specified existing and future debt and other liabilities of Edison
International which are described below under "--Subordination."
Interest
Interest will accrue on the Series A QUIPS from the date they are first
issued at the annual rate of % of their principal amount. Unless deferred as
described below, interest will be payable quarterly in arrears on August 31,
November 30, February 28 and May 31 of each year (each, an "interest payment
date"), beginning August 31, 1999. The amount of interest payable for any
period will be computed on the basis of a 360-day year of twelve 30-day months.
Extension Periods
As long as no Subordinated Indenture Event of Default has occurred and has
not been cured, Edison International will have the right to defer the payment
of interest on the Series A QUIDS as described in "Description of the Series A
QUIPS--Distributions" in this prospectus supplement. During an extension
period, the holders of Series A QUIDS will continue to accrue interest at the
rate stated above, plus will accrue additional interest on each deferred
interest payment at the annual rate of %, compounded quarterly, from the
corresponding interest payment date, to the extent permitted by law. Whenever
we use the term "interest" with respect to the Series A QUIDS in this
prospectus supplement, we are including any of this additional interest.
Extension Period Restrictions
During an extension period, Edison International and its subsidiaries may
not take any of the following actions, except as described below:
. declare or pay any dividend or other distribution on, redeem, purchase
or acquire, or make a liquidation payment on any shares of Edison
International's capital stock,
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. pay any amount on or repay, redeem or repurchase any debt securities
issued by Edison International that rank equally with or junior to the
Series A QUIDS, or
. make any payments under any of Edison International's guarantees if such
guarantee ranks equally with or junior to the Series A QUIDS and
guarantees payments on any debt security of any of Edison
International's subsidiaries.
Notwithstanding the foregoing, Edison International may take any of the
following actions during an extension period:
. declare dividends in, or make any payment in, shares of common stock of
Edison International,
. purchase its common stock if related to the issuance of common stock
under any of Edison International's benefit plans for its directors,
officers or employees, or
. declare a dividend in connection with any stockholder's rights plan,
issue stock under such plan or repurchase any rights distributed
pursuant to the plan.
Extension Period Procedures
Edison International will give the Property Trustee, the Regular Trustees
and the Subordinated Indenture Trustee notice of its election to begin an
extension period at least one Business Day before the earlier of:
. the next distribution date for the Series A QUIPS, or
. the date the Regular Trustees are required to give notice of the record
date or the distribution date to (1) the New York Stock Exchange or
other applicable self-regulatory organization or (2) the holders of the
Series A QUIPS.
The Subordinated Indenture Trustee must notify the holders of the Series A
QUIDS in the manner described below in "--Notices" of Edison International's
election to begin an extension period.
Stated Maturity
The Series A QUIDS initially will have a stated maturity of , 2029.
However, Edison International may shorten the stated maturity to a date on or
after , 2014. You should expect that Edison International will exercise
this option if, for example, a tax development occurs that prohibits Edison
International from deducting interest payments on the Series A QUIDS unless
the Series A QUIDS have a shorter maturity date.
Edison International also will have the option to extend the stated
maturity to , 2048, if:
. Edison International is not in bankruptcy, insolvent or in liquidation,
. Edison International is not in default on the payment of interest or
principal on the Series A QUIDS,
. the Trust is not in arrears on payments of distributions on the Series A
QUIPS,
. no deferred distributions are accumulated on the Series A QUIPS, and
. the Series A QUIPS are rated at least BBB- by Standard & Poor's Ratings
Services or Baa3 by Moody's Investors Services, Inc. or an equivalent
rating by a successor rating agency.
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You should assume that Edison International will exercise its option to
extend the stated maturity if Edison International is unable to refinance at a
lower interest rate or it is in the interest of Edison International to defer
the stated maturity of the Series A QUIDS.
Procedures
Edison International will give notice to the Subordinated Indenture Trustee
of its selection of a new stated maturity at least 30 days, but not more than
60 days, prior to the effective date of the change. The Subordinated Indenture
Trustee will give holders of Series A QUIDS notice of the new stated maturity
promptly upon its receipt of the notice from Edison International. The
Subordinated Indenture Trustee will give the notice in the manner described
below under "--Notices."
Optional Redemption
Edison International may redeem the Series A QUIDS, at its option, before
their stated maturity as follows:
. at any time on or after , 2004, in whole or in part, provided that no
partial redemption may occur during an extension period, and
. at any time in whole, but not in part, within 90 days after a Tax Event
or an Investment Company Act Event has occurred.
Edison International will pay the Redemption Price on the redemption date
to the holders of Series A QUIDS to be redeemed. In this context, "Redemption
Price" means the aggregate principal amount of the Series A QUIDS to be
redeemed, plus any accrued and unpaid interest on those securities to the
redemption date.
Tax Event
"Tax Event" means that Edison International receives an opinion of counsel,
experienced in such matters, that as a result of any Tax Change, there is more
than an insubstantial risk that:
. the Trust is, or will be within 90 days after the date of the opinion of
counsel, subject to United States federal income tax with respect to
income received or accrued on the Series A QUIDS,
. interest payable by Edison International or original issue discount
accruing on the Series A QUIDS is not, or within 90 days after the date
of the opinion, will not be, deductible by Edison International, in
whole or in part, for United States federal income tax purposes, or
. the Trust is, or will be within 90 days after the date of the opinion,
subject to more than a minimal amount of other taxes, duties or
governmental charges.
As used above, "Tax Change" means any of the following that are enacted,
promulgated or announced on or after the date of this prospectus supplement:
. amendment to or change, including any announced prospective change, in
the laws or any regulations under the laws of the United States or of
any political subdivision or taxing authority of the United States, or
. official administrative pronouncement or judicial decision interpreting
or applying the laws or regulations stated above whether or not the
pronouncement or decision is issued to or in connection with a
proceeding involving Edison International or the Trust or is subject to
review or appeal.
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Please see "Material United States Federal Income Tax Considerations--
Possible Tax Law Changes" in this prospectus supplement for a description of
certain tax law developments that could result in a Tax Event.
Investment Company Act Event
"Investment Company Act Event" means that Edison International receives an
opinion of counsel, experienced in such matters, that as a result of the
occurrence of a change in law or regulation, or a written change in
interpretation or application of law or regulation, by any legislative body,
court, governmental agency or regulatory authority effective on or after the
date of this prospectus supplement, there is more than an insubstantial risk
that the Trust is or will be considered an "investment company" that is
required to be registered under the Investment Company Act of 1940, as amended.
Payment of Additional Sums
If a Tax Event is continuing and Edison International does not elect to
redeem the Series A QUIDS or liquidate the Trust, Edison International will pay
additional amounts, if any, to the holders of the Series A QUIDS so that,
notwithstanding any additional taxes, duties or charges imposed on the Trust
because of a Tax Event, the Trust will have sufficient funds to pay the full
amount of distributions due on the outstanding Series A Trust Securities.
Redemption Procedures
Edison International will give the holders of the Series A QUIDS at least
30 days, but not more than 60 days, notice before the redemption date, in the
manner described below under "--Notices" in this prospectus supplement. In all
other respects, the procedures for redeeming the Series A QUIDS will be similar
to those for redeeming the Series A QUIPS. See "Description of the Series A
QUIPS-- Redemption--Redemption Procedures" in this prospectus supplement.
On the redemption date, interest will stop accruing on the Series A QUIDS
called for redemption. However, if payment of the Redemption Price for any
Series A QUIDS is not made, interest on those Series A QUIDS will continue to
accrue to the date the Redemption Price is paid.
Exchange of Series A QUIPS for Series A QUIDS
Edison International will have the right at any time to terminate the
Trust. In such event, the Property Trustee will distribute the Series A QUIDS
to the holders of the Series A Trust Securities in exchange for their
securities. See "Description of the Series A QUIPS--Exchange of Series A QUIPS
for Series A QUIDS" in this prospectus supplement for the terms and procedures
relating to such an exchange.
Restrictions on Payments
If any Series A QUIDS are outstanding, Edison International will be
prohibited from taking specified actions described below if:
. an event has occurred that constitutes a Subordinated Indenture Event of
Default or, after notice or passage of time, or both, would constitute a
Subordinated Indenture Event of Default, and Edison International has
knowledge of such event but does not take reasonable steps to cure the
default,
. Edison International does not pay any amount due under the Series A
QUIPS Guarantee relating to the Series A QUIPS, if the Series A QUIDS
are held by the Trust, or
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. Edison International has given notice of its election to begin an
extension period and has not rescinded such notice, or any extension
period is continuing.
In such event, Edison International may not take any of the following
actions, except as described below:
. declare or pay any dividend or other distribution on, redeem, purchase
or acquire, or make a liquidation payment on any shares of Edison
International's capital stock,
. pay any amount on or repay, redeem or repurchase any debt securities
issued by Edison International that rank equally with or junior to the
Series A QUIDS, or
. make any payments under any of Edison International's guarantees if such
guarantee ranks equally with or junior to the Series A QUIDS and
guarantees payments on any debt securities of any of Edison
International's subsidiaries.
Notwithstanding the foregoing, Edison International may:
. declare dividends in, or make any payment in, shares of common stock of
Edison International,
. purchase its common stock if related to the issuance of common stock
under any of Edison International's benefit plans for its directors,
officers or employees,
. declare a dividend in connection with any stockholder's rights plan,
issue stock under such plan or repurchase any rights distributed
pursuant to the plan, or
. make payments under the Series A QUIPS Guarantee or any other Preferred
Securities Guarantee (as defined in the accompanying prospectus).
Consolidation, Merger and Conveyance of Assets as an Entirety
Edison International is required to satisfy the conditions described under
"Description of Debt Securities--Consolidation, Merger and Conveyance of Assets
as an Entirety" in the accompanying prospectus, in order to consolidate with or
merge into any other entity or convey, transfer or lease its properties and
assets substantially as an entirety to any entity. In addition to these
conditions, the successor entity must assume all of Edison International's
obligations with respect to the Series A QUIPS Guarantee and Expense Agreement,
and such transaction must be permitted under, and not give rise to any
violation of, the Trust Agreement or the Series A QUIPS Guarantee.
Modification of Subordinated Indenture
The Subordinated Indenture may be modified, amended or supplemented under
the circumstances described under "Description of Debt Securities--Modification
of Indenture" in the accompanying prospectus. However, any amendment that
adversely affects the holders of the Series A QUIPS in any material respect, as
well as any termination of the Subordinated Indenture and any waiver of a
Subordinated Indenture Event of Default, will require the consent of the
holders of a majority in liquidation amount of the Series A QUIPS.
Subordination
The Series A QUIDS are subordinated securities and, as a result, the
payment of principal, interest and any other amount on the Series A QUIDS is
subordinated in right of payment to the prior payment in full of all of Edison
International's Senior Debt. This means that in certain circumstances where
Edison International may not be making payments on all of its debt obligations
as they come due, the holders of all of Edison International's Senior Debt will
be entitled to receive payment in full
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of all amounts that are due or will become due on the Senior Debt before
holders of Series A QUIDS will be entitled to receive any amounts on the Series
A QUIDS. These circumstances include:
. Edison International makes a payment or distributes assets to creditors
upon any liquidation, dissolution, winding up or reorganization of
Edison International, or as part of an assignment or marshalling of
Edison International's assets for the benefit of its creditors,
. Edison International files for bankruptcy or certain other events in
bankruptcy, insolvency or similar proceedings occur, or
. the maturity of the Series A QUIDS is accelerated. (For example, the
entire principal amount of the Series A QUIDS may be declared to be due
and immediately payable or may be automatically accelerated due to a
Subordinated Indenture Event of Default as described under "'Description
of Debt Securities--Events of Default" in the accompanying prospectus.)
In addition, Edison International is not permitted to make payments of
principal, any interest or any other amounts on the Series A QUIDS if it
defaults in its obligation to make payments on Senior Debt and does not cure
such default, if an event of default that permits the holders of Senior Debt to
accelerate the maturity of the Senior Debt occurs, or if any judicial
proceeding is pending with respect to any of these defaults.
These subordination provisions mean that if Edison International is
insolvent, a holder of Edison International's Senior Debt may ultimately
receive out of Edison International's assets more than a holder of Series A
QUIDS.
In this context, "Senior Debt" means the principal, any premium and
interest on all of Edison International's indebtedness (including indebtedness
of others that Edison International guarantees), whether such indebtedness
exists now or is created, incurred or assumed by Edison International after the
date of this prospectus supplement, that:
. is for money Edison International borrows,
. is a letter of credit, bankers' acceptance or similar obligation of
Edison International,
. is evidenced by a note or similar instrument that Edison International
has given when it acquired any business, property or assets,
. is issued or assumed by Edison International as the deferred purchase
price of property or services (other than trade accounts payable or
accrued liabilities arising in the ordinary course of Edison
International's business), or
. Edison International owes as a lessee under the leases that generally
accepted accounting principles require Edison International to
capitalize on its balance sheet or leases made as part of any sale and
leaseback transaction it engages in.
Senior Debt also includes any amendment, renewal, replacement, extension,
modification or refunding of any indebtedness that itself was Senior Debt.
However, Senior Debt does not include indebtedness:
. that expressly states in the instrument creating or evidencing it that
it does not rank senior in right of payment to the Series A QUIDS or to
any other indebtedness of Edison International that ranks equally with
or junior to the Series A QUIDS,
. that is without recourse to Edison International at the time such debt
was incurred (without respect to any election under Section 1111(b) of
the Bankruptcy Code),
. to any of Edison International's subsidiaries, or
. to any of Edison International's employees not incurred in the ordinary
course of business.
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Senior Debt does not include the Series A QUIDS.
Because Edison International is a holding company, Edison International's
right to participate in any asset distribution of any of its subsidiaries, on
liquidation, reorganization or otherwise, will rank junior to rights of all
creditors of that subsidiary (except to the extent that Edison International
may itself be a creditor of that subsidiary). The rights of holders of Series A
QUIDS to benefit from those distributions will also be junior to those prior
claims. Consequently, the Series A QUIDS will be effectively subordinated to
all liabilities of Edison International's subsidiaries. A holder of Series A
QUIDS should look only to the assets of Edison International for payments on
the Series A QUIDS.
At March 31, 1999, Edison International had total liabilities of
approximately $21.217 billion. Of this amount, approximately $6.770 billion
would be Senior Debt of Edison International or liabilities of its subsidiaries
that would effectively rank senior to the Series A QUIDS. During the second
quarter of 1999, Edison International's subsidiaries issued the following
additional Senior Debt:
.$300 million of 6.65% notes due 2029 in April 1999
.$120 million of 6.0% preferred securities in May 1999
.$600 million of 7.73% senior notes due 2009 in June 1999
The Series A QUIDS, the Subordinated Indenture and the Series A QUIPS
Guarantee do not limit Edison International's or any of its subsidiaries'
ability to incur additional indebtedness, including indebtedness that ranks
senior to the Series A QUIDS and the Series A QUIPS Guarantee. We expect that
Edison International and its subsidiaries may incur substantial additional
amounts of indebtedness in the future.
Satisfaction and Discharge
The Subordinated Indenture will cease to be of further effect, and Edison
International will be deemed to have satisfied and discharged all of its
obligations under the Subordinated Indenture, except as noted below, when:
. all outstanding Series A QUIDS have become due or will become due within
one year at their stated maturity or on a Redemption Date, and
. Edison International deposits with the Indenture Trustee, in trust,
funds and/or government obligations that are sufficient to pay and
discharge all remaining indebtedness on the outstanding Series A QUIDS.
Edison International will remain obligated to pay all other amounts due
under to the Subordinated Indenture and to take certain ministerial tasks as
described in the Subordinated Indenture.
Payments
Edison International will pay interest to the direct holders of Series A
QUIDS listed in Edison International's records at the close of business on the
record date, as discussed below, in advance of each interest payment date. If
the Series A QUIDS are distributed in exchange for the Series A QUIPS, Edison
International will make payments on the Series A QUIDS in accordance with
procedures similar to those described under "Description of the Series A
QUIPS--Payment and Paying Agents" in this prospectus supplement.
Any money paid to the Subordinated Indenture Trustee or any paying agent,
or held in trust by Edison International, for payments on any Series A QUIDS,
that remains unclaimed at the end of two years after the amount is due will be
repaid to Edison International. After that two-year period, a holder of Series
A QUIDS may look only to Edison International for payment of those amounts.
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Business Day
If any payment is due on a day that is not a Business Day, the payment will
be made on the following Business Day unless that Business Day is in a
different calendar year, in which case the payment will be made on the
preceding Business Day. Each payment made on the following or preceding
Business Day will have the same force and effect as if made on the original
payment due date.
Record Date
If the Series A QUIDS are held in book-entry form, the record date will be
one Business Day before the relevant interest payment date. If the Series A
QUIDS are held in certificated form, the record date will be the 15th day,
whether or not a Business Day, before the relevant interest payment date.
Notices
Notices to be given to holders of Series A QUIDS held in certificated form
may be given by mail to their addresses as set forth in Edison International's
records. Notices to be given to holders of Series A QUIDS held in book-entry
form will be given to DTC in accordance with its procedures.
BOOK-ENTRY ISSUANCE
"Street Name" and Other Indirect Holders
Investors who hold Series A QUIPS in accounts at banks or brokers will
generally not be recognized by the Trust as legal holders of Series A QUIPS.
This is called holding in "Street Name." Instead, the Trust would recognize
only the bank or broker that directly holds, or the financial institution the
bank or broker uses to hold, its Series A QUIPS. These intermediary banks,
brokers and other financial institutions pass along distributions and other
payments on the Series A QUIPS, either because they agree to do so in their
customer agreements or because they are legally required to. If you hold Series
A QUIPS in "Street Name," you should check with your own institution to find
out:
. how it handles securities payments and notices,
. whether it imposes fees or charges,
. how it would handle voting if ever required,
. whether and how you can instruct it to send you Series A QUIPS
registered in your own name so you can be a direct holder as described
below, and
. how it would pursue rights under the Series A QUIPS if there were a
default or other event triggering the need for holders to act to protect
their interests.
Direct Holders
The Trust's obligations, as well as the obligations of Edison
International, the Securities Trustees and those of any third parties employed
by the Trust, Edison International or the Securities Trustees, run only to
individuals, corporations or other entities who are registered as holders of
Series A QUIPS. As noted above, the Trust does not have obligations to you if
you hold in "Street Name" or other indirect means, either because you choose to
hold Series A QUIPS in that manner or because the Series A QUIPS are issued in
the form of global securities as described below. For example, once the Trust
makes payment to the registered holder, the Trust has no further responsibility
for the payment even if that holder is legally required to pass the payment
along to you as a "Street Name" customer but does not do so.
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Global Securities
What is a Global Security?
The Series A QUIPS will be issued in the form of global securities, and,
therefore, the ultimate beneficial owners can only be indirect holders. The
Trust does this by requiring that the global security be registered in the name
of DTC or its nominee and by requiring that the Series A QUIPS included in the
global security not be transferred in the name of any other direct holder
unless the special circumstances described below occur. Any person wishing to
own Series A QUIPS must do so indirectly by virtue of an account with a broker,
bank or other financial institution that in turn has an account with DTC.
Special Investor Considerations for Global Securities
As an indirect holder, an investor's rights relating to a global security
will be governed by the account rules of the investor's financial institution
and of DTC, as the well as general laws relating to securities transfers. The
Trust does not recognize this type of investor as a holder of Series A QUIPS
and instead deals only with DTC or its nominee. See "--The DTC System" below.
An investor should be aware that because Series A QUIPS are issued only in
the form of global securities:
. the investor cannot get Series A QUIPS registered in his or her own
name,
. the investor cannot receive physical certificates for his or her
interest in the Series A QUIPS,
. the investor will be a "Street Name" holder and must look to his or her
own bank or broker for payments on the Series A QUIPS and protection of
his or her legal rights relating to the Series A QUIPS (see "--"Street
Name' and Other Indirect Holders" above),
. the investor may not be able to sell interests in the Series A QUIPS to
some insurance companies and other institutions that are required by law
to own their securities in the form of physical certificates,
. DTC's policies will govern payments, transfers, exchange and other
matters relating to the investor's interest in the global security (see
"--The DTC System" below; the Trust, Edison International and the
Securities Trustees have no responsibility for any aspect of DTC's
actions or for its records of ownership interests in the global
security, nor do they supervise DTC in any way), and
. payment for purchases and sales in the market for corporate bonds and
notes is generally made in next-day funds. In contrast, DTC will usually
require that interests in a global security be purchased or sold within
its system using same-day funds. This difference could have some effect
on how global security interests trade, but neither Edison International
nor the Trust knows what that effect will be.
Special Situations When Global Security Will Be Terminated
In a few special situations, the global security will terminate and
interests in it will be exchanged for physical certificates representing Series
A QUIPS. After that exchange, the choice of whether to hold Series A QUIPS
directly or in "Street Name" will be up to the investor. Investors must consult
their own bank or brokers to find out how to have their interests in Series A
QUIPS transferred to their own name, so that they will be direct holders. The
rights of "Street Name" investors and direct holders in the Series A QUIPS are
described above under "--"Street Name' and Other Indirect Holders" and "--
Direct Holders."
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The special situations for termination of a global security are:
. DTC notifies Edison International or the Trust that it is unwilling,
unable or no longer qualified to continue as the depositary for the
Series A QUIPS,
. Edison International in its sole discretion determines that the global
security will be exchangeable for certificated Series A QUIPS, or
. a Trust Agreement Event of Default has occurred and has not been cured
and the holders of a majority in liquidation amount of the outstanding
Series A QUIPS determine that the global security will be exchangeable
for certificated Series A QUIPS.
When a global security terminates, DTC (and not the Trust, Edison
International or the Securities Trustees) is responsible for deciding the names
of the institutions that will be the initial direct holders.
The DTC System
DTC has advised us that it is a limited-purpose trust company created to
hold securities for its participating organizations (the "Participants"). DTC
also facilitates the clearance and settlement between Participants of
transactions of securities deposited with DTC through changes in the account
records of its Participants. The Participants include securities brokers and
dealers, banks, trust companies, clearing corporations and certain other
organizations. The Underwriters are Participants of the DTC System. Access to
DTC's system is also available to other entities such as securities brokers and
dealers, banks and trust companies that work through a Participant (the
"Indirect Participants").
When you purchase Series A QUIPS through the DTC system, the purchases must
be made by or through a Participant, who will receive credit for the Series A
QUIPS on DTC's records. Since you actually own the Series A QUIPS, you are the
beneficial owner and your ownership interest will only be recorded on the
Participants' or Indirect Participants' records. DTC has no knowledge of your
individual ownership of the Series A QUIPS. DTC's records only show the
identity of the Participants and the amount of the Series A QUIPS held by or
through them. You will not receive a written confirmation of your purchase or
sale or any periodic statement directly from DTC. You will receive these from
your Participant or Indirect Participant. Thus the Participants or Indirect
Participants are responsible for keeping accurate account of the holdings of
their customers like you.
Any redemption notices will be sent by Edison International and the Trust
directly to DTC, who will in turn inform the Participants, who will then
contact you as a beneficial holder. If less than all of the Series A QUIPS are
being redeemed, DTC's current practice is to choose by lot the amount of the
interest of each Participant to be redeemed. The Participant will then use an
appropriate method to allocate the redemption price among its beneficial
holders like you.
It is DTC's current practice, upon receipt of any payment of distributions
or liquidation amount, to credit Participants' accounts on the payment date
based on their holdings of beneficial interests in the global securities as
shown on DTC's records. In addition, it is DTC's current practice to assign any
consenting or voting rights to Participants whose accounts are credited with
Series A QUIPS on a record date, by using an omnibus proxy. Payments by
Participants to owners of beneficial interests in the global securities, and
voting by Participants, will be based on the customary practices between the
Participants and owners of beneficial interests, as is the case with the Series
A QUIPS held for the account of customers registered in "Street Name." However,
payments will be the responsibility of the Participants and not of DTC, the
Securities Trustees, the Trust or Edison International.
We have obtained the information concerning DTC and DTC's book-entry system
from sources that we believe to be accurate, but we are not responsible for the
accuracy of this information. In
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addition, we are not responsible for the performance by DTC, its Participants
or any Indirect Participants of any of their obligations.
Registration of Series A QUIDS
The Series A QUIDS initially will be issued in certificated form and
registered in the name of the Property Trustee. If in the future the Series A
QUIDS are distributed to the holders of Series A QUIPS in exchange for the
Series A QUIPS and at that time the Series A QUIPS are represented by a global
security, the Series A QUIDS would also be represented by a global security. In
this event, we expect that the book-entry arrangements applicable to the Series
A QUIPS would be similar to those applicable to the Series A QUIDS.
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MATERIAL UNITED STATES FEDERAL INCOME TAX CONSIDERATIONS
General
In the opinion of Latham & Watkins, counsel to Edison International and the
Trust, the following is a summary of the material U.S. federal income tax
consequences relating to the purchase, ownership and disposition of Series A
QUIPS. This summary only addresses the tax consequences to a person that
acquires Series A QUIPS on their original issue date at their original offering
price and that is a United States Holder. A "United States Holder" is:
. an individual citizen or resident of the United States,
. a corporation organized under the laws of the United States, any state
or the District of Columbia,
. an estate the income of which is subject to U.S. federal income tax
without regard to its source, or
. a trust if a U.S. court is able to exercise primary supervision over
administration of the trust and one or more U.S. persons have authority
to control all substantial decisions of the trust.
This summary does not purport to deal with all aspects of taxation that may
be relevant to a holder in light of its personal investments or tax
circumstances, or to holders who receive special treatment under the federal
income tax laws, including, without limitation:
. persons that are not United States Holders, except as described below
under "--Non-United States Holders,"
. financial institutions,
. insurance companies,
. regulated investment companies,
. real estate investment trusts,
. tax exempt organizations,
. broker-dealers,
. persons that will hold Series A QUIPS as part of a position in a
"straddle" or as part of a "hedging," "conversion" or other integrated
investment transaction for U.S. federal income tax purposes,
. persons whose functional currency is not the U.S. dollar, or
. persons that do not hold Series A QUIPS as capital assets.
This summary is based upon the U.S. Internal Revenue Code of 1986, as
amended (the "Code"), Treasury regulations, Internal Revenue Service rulings
and pronouncements and judicial decisions now in effect, all of which are
subject to change at any time. These changes may be applied retroactively in a
manner that could cause the tax consequences to vary substantially from the
consequences described below, possibly having an adverse affect on a beneficial
owner of Series A QUIPS.
The authorities on which this summary is based are subject to various
interpretations, and it is possible that the U.S. federal income tax treatment
of the purchase, ownership and disposition of Series A QUIPS may differ from
the treatment described below.
You are advised to consult with your own tax advisors in light of your own
particular circumstances as to the U.S. federal tax consequences of the
purchase, ownership and
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disposition of Series A QUIPS, as well as the effect of any state, local or
foreign tax laws and potential changes in applicable tax laws.
Classification of the Series A QUIDS and the Trust
Edison International, the Trust and the holders of the Series A QUIPS (by
the acceptance of a beneficial interest in a Series A QUIPS) have agreed to
treat the Series A QUIDS as indebtedness for all United States tax purposes and
the Series A QUIPS as evidence of an indirect beneficial ownership interest in
the Series A QUIDS. Given such treatment and assuming full compliance with the
terms of the Trust Agreement, the Indenture and certain other documents, the
Trust will be treated as a "grantor trust" and not as an association taxable as
a corporation and the Series A QUIDS will be treated as indebtedness for U.S.
federal income tax purposes. As a result, each beneficial owner of Series A
QUIPS will be required to include in its gross income its pro rata share of the
interest income, including original issue discount ("OID"), paid or accrued
with respect to the Series A QUIDS, whether or not cash is actually distributed
to the holders. See "--Interest Income and Original Issue Discount" below.
Interest Income and Original Issue Discount
Under Treasury regulations applicable to debt instruments issued on or
after August 13, 1996, a "remote" contingency that stated interest will not be
timely paid will be ignored in determining whether such debt instrument is
issued with OID. As a result of terms and conditions of the Series A QUIDS that
prohibit certain payments with respect to Edison International's capital stock
and indebtedness if Edison International elects to extend interest payment
periods, Edison International believes that the likelihood of its exercising
its option to defer payments is remote. See "Description of the Series A
QUIPS--Distributions." Based on the foregoing, Edison International believes
that the Series A QUIDS will not be considered to be issued with OID at the
time of their original issuance. Accordingly, the following discussion assumes
that unless and until Edison International exercises its option to defer any
payment of interest, the Series A QUIDS will not be treated as issued with OID.
Under the Treasury regulations, if Edison International exercises its
option to defer any payment of interest, the Series A QUIDS would at that time
be treated as issued with OID, and all stated interest on the Series A QUIDS
would thereafter be treated as OID as long as the Series A QUIDS remained
outstanding. In this event, all of a holder's taxable interest income with
respect to the Series A QUIDS would be accounted for as OID on an economic
accrual basis regardless of such holder's method of tax accounting, and actual
distributions of stated interest would not be reported as taxable income.
Consequently, a holder would be required to include OID in gross income even
though Edison International would not make any actual cash payments during an
Extension Period.
The Regulations have not been addressed in any rulings or other
interpretations by the IRS, and it is possible that the IRS could take a
position contrary to the interpretation described above.
Because income on the Series A QUIPS will constitute interest or OID,
corporate United States Holders of the Series A QUIPS will not be entitled to a
dividends-received deduction with respect to any income taken into account with
respect to the Series A QUIPS.
Subsequent uses of the term "interest" in this summary include income in
the form of OID.
Distribution of Series A QUIDS to Holders of Series A QUIPS Upon Liquidation of
the Trust
A distribution by the Trust of the Series A QUIDS as described under the
caption "Description of the Series A QUIPS--Exchange of Series A QUIPS for
Series A QUIDS" will be nontaxable. This distribution will result in the holder
of Series A QUIPS receiving directly its pro rata share of the Series A QUIDS,
with a holding period and aggregate tax basis equal to the aggregate tax basis
the holder had in its Series A QUIPS before the distribution.
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If, however, the liquidation of the Trust were to occur because the Trust
is subject to U.S. federal income tax with respect to income accrued or
received on the Series A QUIDS, the distribution of Series A QUIDS to a holder
of Series A QUIPS would be a taxable event to the Trust and each holder of
Series A QUIPS, and each such holder would recognize gain or loss as if the
holder had exchanged its Series A QUIPS for the Series A QUIDS upon liquidation
of the Trust. A holder of Series A QUIPS will include interest in income in
respect of Series A QUIDS received from the Trust in the manner described above
under "--Interest Income and Original Issue Discount."
Sale or Redemption of Series A QUIPS
A holder that sells Series A QUIPS, including through a redemption for
cash, will recognize gain or loss equal to the difference between such holder's
adjusted tax basis in the Series A QUIPS and the amount realized on the sale of
such Series A QUIPS. Assuming that Edison International does not defer interest
payments on the Series A QUIDS, a holder's adjusted tax basis in the Series A
QUIPS generally will be its initial purchase price. If the Series A QUIDS are
deemed to be issued with OID as a result of Edison International's deferral of
interest payments, a holder's adjusted tax basis in the Series A QUIPS
generally will be its initial purchase price, increased by OID previously
includible in such United States Holder's gross income to the date of
disposition and decreased by distributions or other payments received on the
Series A QUIPS from, and including, the date of the first Extension Period.
This gain or loss generally will be a capital gain or loss, except to the
extent any amount realized is treated as a payment of accrued interest with
respect to such holder's pro rata share of the Series A QUIDS required to be
included in income, and generally will be long-term capital gain or loss if the
Series A QUIPS have been held for more than one year. Long-term capital gain of
a non-corporate holder is generally subject to a maximum tax rate of 20%.
If Edison International defers any interest payment on the Series A QUIDS,
the Series A QUIPS may trade at a price that does not fully reflect the value
of accrued but unpaid interest with respect to the Series A QUIDS. A holder who
sells its Series A QUIPS between record dates for payments of distributions
will be required to include accrued but unpaid interest on the Series A QUIDS
through the date of disposition as ordinary income and to add the amount of the
accrued but unpaid interest to its adjusted tax basis in the Series A QUIPS. To
the extent the selling price is less than the holder's adjusted tax basis, such
holder will recognize a capital loss. Subject to certain limited exceptions, a
holder cannot offset ordinary income against capital losses for U.S. federal
income tax purposes.
Backup Withholding Tax and Information Reporting for United States Holders
The amount of interest income paid and OID accrued on the Series A QUIPS
held of record by United States Holders, other than corporations and other
exempt United States Holders, will be reported to the IRS. "Backup" withholding
at a rate of 31% will apply to payments of interest to a non-exempt United
States Holder unless the United States Holder furnishes its taxpayer
identification number in the manner prescribed in applicable Treasury
regulations, certifies that such number is correct, certifies as to no loss of
exemption from backup withholding and meets certain other conditions.
Payment of the proceeds from the disposition of Series A QUIPS to or
through the U.S. office of a broker is subject to information reporting and
backup withholding unless the holder establishes an exemption from information
reporting and backup withholding.
Any amounts withheld from a holder under the backup withholding rules will
be allowed as a refund or a credit against such holder's U.S. federal income
tax liability, provided the required information is furnished to the IRS.
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It is anticipated that income on the Series A QUIPS will be reported to
holders on Form 1099, and mailed to holders of the Series A QUIPS by January 31
following each calendar year.
Possible Tax Law Changes
You should be aware that legislation has been proposed by the Clinton
Administration in the past that, if enacted, would have denied an interest
expense deduction to issuers of instruments such as the Series A QUIDS. While
legislation of that kind is not currently pending, we can give no assurance
that similar legislation will not ultimately be enacted into law, or that other
developments will not occur on or after the date of this prospectus supplement
that would adversely affect the tax treatment of the Series A QUIDS or the
Trust. Changes of that kind also could give rise to a Tax Event.
Non-United States Holders
A "Non-United States Holder" is a person who is not a United States Holder.
Please note that if you pay federal income tax on a net basis on income or gain
with respect to the Series A QUIPS because such income or gain is effectively
connected with the conduct of a United States trade or business, this
disclosure does not cover the United States federal tax rules that apply to
you.
Payments by the Trust to any holder of Series A QUIPS who or which is a
Non-United States Holder will generally not be subject to U.S. federal income
tax or withholding tax, provided that:
(1) the beneficial owner of the Series A QUIPS does not actually or
constructively own 10 percent or more of the total combined voting
power of all classes of voting stock of Edison International,
(2) the beneficial owner of the Series A QUIPS is not a controlled
foreign corporation that is related to Edison International through
stock ownership, and
(3) either (A) the beneficial owner of the Series A QUIPS certifies to
the Trust, under penalty of perjury, that it is not a United States
Holder and provides its name and address on a Form W-8 or suitable
substitute form, or (B) a securities clearing organization, bank or
other financial institution that holds customers' securities in the
ordinary course of its trade or business, and holds the Series A
QUIPS in such capacity, certifies to the Trust, under penalty of
perjury, that it has received such statement from the beneficial
owner or from another entity described in B between it and the
beneficial owner and furnishes the Trust with a copy thereof.
A Non-United States Holder of a Series A QUIPS will generally not be
subject to U.S. federal income tax or withholding tax on any gain realized upon
the sale, redemption, retirement, or other disposition of a Series A QUIPS
(other than gain attributable to accrued interest, which is addressed in the
preceding paragraph) unless:
(1) the Non-United States Holder is an individual who is present in the
U.S. for 183 days or more during the taxable year and meets certain
other conditions; or
(2) the Non-United States Holder is subject to tax under provisions of
U.S. tax law applicable to U.S. expatriates, including former
citizens or residents of the United States.
Treasury regulations that are generally effective with respect to payments
after December 31, 2000, would provide alternative methods for satisfying the
certification requirement described in clauses (3)(A) and (3)(B) above. Such
regulations also would require, in the case of Series A QUIPS held by a foreign
partnership, that:
. the certification described in clause (3) above be provided by the
partners rather than by the foreign partnership, and
S-31
<PAGE>
. the partnership provides certain information, including a U.S. taxpayer
identification number.
A look-through rule would apply in the case of tiered partnerships.
Backup Withholding and Information Reporting for Non-United States Holders
If a Non-United States Holder receives payments of interest or principal
directly from us or through the United States office of a custodian, nominee,
agent or broker, there is the possibility that both backup withholding at a
rate of 31% and information reporting will apply to such payments. With respect
to interest payments made on the Series A QUIPS, however, backup withholding
and information reporting will not apply if you certify, generally on a Form W-
8 or substitute form, that you are not a United States person for United States
federal income tax purposes.
Moreover, backup withholding or information reporting generally will not
apply to proceeds received on the sale, exchange, redemption, or other
disposition of the Series A QUIPS, if a Non-United States Holders properly
provides, generally on Form W-8 or a substitute form, a statement that he or
she is an "exempt foreign person" for purposes of the broker reporting rules
and other required information. If a Non-United States Holder is not required
to pay United States federal income or withholding tax on the sale or other
disposition of the Series A QUIPS, as described above under "Non-United States
Holders," he or she will generally qualify as an "exempt foreign person" for
purposes of the broker reporting rules.
If payments of principal and interest are made to a Non-United States
Holder outside the United States by or through the foreign office of its
foreign custodian, nominee or other agent, or if such Non-United States Holder
receives the proceeds of the sale of the Series A QUIPS through a foreign
office of a "broker," as defined in the pertinent Treasury regulations, backup
withholding or information reporting will generally not apply to such payments.
Backup withholding and information reporting will apply, however, if the
foreign custodian, nominee, agent or broker has actual knowledge or reason to
know that the payee is a United States person. Information reporting, but not
backup withholding, will apply to payments if the payment is made by a foreign
office of a custodian, nominee, agent or broker that is a United States person
or a controlled foreign corporation for United States federal income tax
purposes, or that derives 50% or more of its gross income from the conduct of a
United States trade or business for a specified three year period, unless the
broker has in its records documentary evidence that you are a Non-United States
Holder and other conditions specified in the Code are met.
Any amounts withheld under the backup withholding rules may be refunded or
credited against the Non-United States Holder's United States federal income
tax liability, provided the required information is furnished to the IRS.
New Backup Withholding Regulations
New regulations relating to withholding tax on income paid to foreign
persons will generally be effective for payments made after December 31, 2000,
subject to some transition rules. The new withholding regulations modify and,
in general, unify the way in which a Non-United States Holder establishes its
status as a Non-United States "beneficial owner" eligible for withholding
exemptions including the portfolio interest exemption, a reduced treaty rate or
an exemption from backup withholding. For example, the new regulations will
require new forms, which you will generally have to provide earlier than you
would have had to provide replacements for expiring existing forms.
The new withholding regulations clarify withholding agents' reliance
standards. They also require additional certifications for claiming treaty
benefits. The new withholding regulations also provide somewhat different
procedures for foreign intermediaries and flow-through entities, such as
foreign partnerships, to claim the benefit of applicable exemptions on behalf
of non-United States
S-32
<PAGE>
beneficial owners for which or for whom they receive payments. The new
withholding regulations also amend the foreign broker office definition as it
applies to partnerships.
When a Non-United States Holder purchases the Series A QUIPS, he or she
will be required to submit certification that complies with the temporary
Treasury regulations in order to obtain an available exemption from or
reduction in withholding tax. The new withholding regulations provide that
certifications satisfying the requirements of the new withholding regulations
will be deemed to satisfy the requirement of the Treasury regulations now in
effect. In any case, the Non-United States Holder must provide certifications
that comply with the provisions of the new withholding regulations, where
required, not later than December 31, 2000, if the United States Holder remains
as a holder on such date, unless the Non-United States Holder receives payments
on the Series A QUIPS through a qualified intermediary, as defined in the new
withholding regulations, that has provided a proper certification on the Non-
United States Holder's behalf. If the Non-United States Holder is claiming a
benefit under an income tax treaty and not relying on the portfolio interest
exemption, such holder should be aware that he or she may be required to obtain
a taxpayer identification number and to certify your eligibility under the
applicable treaty's limitations on benefits article in order to comply with the
new withholding regulations' certification requirements.
The new withholding regulations are complex and this summary does not
completely describe them. Please consult your tax advisor to determine how the
new withholding regulations will affect your particular circumstances.
S-33
<PAGE>
UNDERWRITING
Edison International, the Trust and the underwriters for the offering (the
"Underwriters") named below have entered into an underwriting agreement with
respect to the Series A QUIPS being offered. Subject to certain conditions,
each Underwriter has severally agreed to purchase the number of Series A QUIPS
indicated in the following table. Goldman, Sachs & Co., A.G. Edwards & Sons,
Inc., Lehman Brothers Inc., Merrill Lynch, Pierce, Fenner & Smith Incorporated,
Morgan Stanley & Co. Incorporated, PaineWebber Incorporated, Prudential
Securities Incorporated and Salomon Smith Barney Inc. are the representatives
of the Underwriters.
<TABLE>
<CAPTION>
Number of
Underwriter Series A QUIPS
----------- --------------
<S> <C>
Goldman, Sachs & Co........................................
A.G. Edwards & Sons, Inc. .................................
Lehman Brothers Inc. ......................................
Merrill Lynch, Pierce, Fenner & Smith
Incorporated.........................................
Morgan Stanley & Co. Incorporated..........................
PaineWebber Incorporated...................................
Prudential Securities Incorporated.........................
Salomon Smith Barney Inc. .................................
---
Total....................................................
===
</TABLE>
If the Underwriters sell more Series A QUIPS than the total number set
forth in the table above, the Underwriters have an option to buy up to an
additional 3,000,000 Series A QUIPS from the Trust to cover such sales. They
may exercise that option for 30 days. If any Series A QUIPS are purchased
pursuant to this option, the Underwriters will severally purchase Series A
QUIPS in approximately the same proportion as set forth in the table above.
Because the Trust will invest the proceeds from the sale of the Series A
QUIPS in the Series A QUIDS issued by Edison International, the underwriting
agreement provides that Edison International will pay underwriting commissions
to the Underwriters, as compensation. The following table shows the per Series
A QUIPS and total underwriting commissions to be paid to the Underwriters by
Edison International. Such amounts are shown assuming both no exercise and full
exercise of the Underwriters' option to purchase 3,000,000 additional Series A
QUIPS.
<TABLE>
<CAPTION>
Paid by
Edison International
-------------------------
No Exercise Full Exercise
----------- -------------
<S> <C> <C>
Per Series A QUIPS.................................... $ $
Total................................................. $ $
</TABLE>
The Underwriters propose to offer the Series A QUIPS to the public
initially at the initial public offering price set forth on the cover page of
this prospectus supplement. Any Series A QUIPS sold by the Underwriters to
securities dealers may be sold at a discount of up to $ per Series A QUIPS
from the initial public offering price. Any of those securities dealers may
resell the Series A QUIPS they purchase from the Underwriters to other brokers
and dealers at a discount of up to $ per Series A QUIPS from the initial
public offering price. If all the Series A QUIPS are not sold at the initial
public offering price, the representatives of the Underwriters may change the
offering price and other selling terms.
Edison International and the Trust have agreed with the Underwriters,
during the period beginning from the date of the underwriting agreement and
continuing to and including the earlier of
S-34
<PAGE>
(i) the termination of trading restrictions on the Series A QUIPS, as
determined by the representatives of the Underwriters, and (ii) 30 days after
the last Time of Delivery (as defined in the underwriting agreement), not to
offer, sell, contract to sell or otherwise dispose of any preferred securities,
any other beneficial interests in the assets of any trust, or any preferred
securities or any other securities of any trust or Edison International, as the
case may be, that are substantially similar to the Series A QUIPS (including
any guarantee of such securities) or any securities that are convertible into
or exchangeable for, or that represent the right to receive, preferred
securities or any such substantially similar securities of any trust or Edison
International, or any debt securities of Edison International (other than the
Series A QUIPS) which mature more than one year after such Time of Delivery and
which are substantially similar to the Series A QUIPS, without the prior
written consent of the representatives of the Underwriters.
Prior to this offering, there has been no public market for the Series A
QUIPS. Edison International and the Trust have applied for listing the Series A
QUIPS on the New York Stock Exchange. If approved, trading in the Series A
QUIPS on the New York Stock Exchange is expected to begin within the 30-day
period after the initial delivery of the Series A QUIPS. In order to meet one
of the requirements for listing the Series A QUIPS, the Underwriters have
undertaken to sell the Series A QUIPS to a minimum of 400 beneficial owners.
The representatives of the Underwriters have advised Edison International and
the Trust that they intend to make a market in the Series A QUIPS prior to the
commencement of trading on the New York Stock Exchange, but are not obligated
to do so and may discontinue market making at any time without notice. No
assurance can be given as to the liquidity of the trading market for the Series
A QUIPS.
In connection with the offering, the Underwriters may purchase and sell the
Series A QUIPS in the open market. These transactions may include short sales,
stabilizing transactions and purchases to cover positions created by short
sales. Short sales involve the sale by the Underwriters of a greater number of
Series A QUIPS than they are required to purchase in the offering. Stabilizing
transactions consist of certain bids or purchases made for the purpose of
preventing or retarding a decline in the market price of the Series A QUIPS
while the offering is in progress.
The Underwriters also may impose a penalty bid. This occurs when a
particular Underwriter repays to the Underwriters a portion of the underwriting
commissions received by it because the Underwriters have repurchased Series A
QUIPS sold by or for the account of such Underwriter in stabilizing or short
covering transactions.
These activities by the Underwriters may stabilize, maintain or otherwise
affect the market place of the Series A QUIPS. As a result, the price of the
Series A QUIPS may be higher than the price that otherwise might exist in the
open market. If these activities are commenced, they may be discontinued by the
Underwriters at any time. These transactions may be effected on the New York
Stock Exchange, in the over-the-counter market or otherwise.
Edison International estimates that its share of the total expenses of this
offering, excluding underwriting discounts and commissions, will be
approximately $ .
Edison International and the Trust have agreed to indemnify the several
Underwriters against specified liabilities, including liabilities under the
Securities Act of 1933, as amended, and to contribute to amounts paid by the
Underwriters if the indemnification provided is unavailable or insufficient.
Certain of the Underwriters or their affiliates have provided from time to
time, and expect to provide in the future, investment or commercial banking
services to Edison International and its affiliates, for which such
Underwriters or their affiliates have received or will receive customary fees
and commissions.
S-35
<PAGE>
VALIDITY OF SERIES A QUIPS, SERIES A QUIDS AND SERIES A QUIPS GUARANTEE
Matters of Delaware law relating to the validity of the Series A QUIPS will
be passed upon on behalf of Edison International and the Trust by Richards,
Layton & Finger P.A., Wilmington, Delaware, special Delaware counsel to Edison
International and the Trust. The validity of the Series A QUIDS and the Series
A QUIPS Guarantee will be passed upon on behalf of Edison International by
Kenneth S. Stewart, Assistant General Counsel of Edison International. Latham &
Watkins, Los Angeles, California will pass upon matters relating to United
States federal income tax considerations. Certain legal matters will be passed
upon for the Underwriters by Cleary, Gottlieb, Steen & Hamilton, New York, New
York.
S-36
<PAGE>
++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++
+The information in this prospectus is not complete and may be changed. We may +
+not sell these securities until the registration statement filed with the +
+Securities and Exchange Commission is effective. This prospectus is not an +
+offer to sell these securities and it is not soliciting an offer to buy these +
+securities in any state where the offer or sale is not permitted. +
++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++
Subject to Completion, Dated July 13, 1999
PROSPECTUS
[LOGO OF EDISON INTERNATIONAL(SM)]
$2,500,000,000
Edison International
Debt Securities, Common Stock, Preferred Stock and Guarantees
EIX Trust I
EIX Trust II
EIX Trust III
Preferred Securities Guaranteed by Edison International
------------
We may offer and sell the securities from time to time in one or more
offerings. This prospectus provides you with a general description of the
securities we may offer.
Each time we sell securities we will provide a supplement to this prospectus
that contains specific information about the offering and the terms of the
securities. The supplement may also add, update or change information contained
in this prospectus. You should carefully read this prospectus and any
supplement before you invest in any of our securities.
Edison International
Edison International may offer and sell the following securities:
. debt securities
. common stock
. preferred stock
. guarantees of preferred securities
The Trusts
EIX Trust I, EIX Trust II and EIX Trust III may offer and sell preferred
securities, guaranteed by Edison International.
------------
Neither the Securities and Exchange Commission nor any state securities
commission has approved or disapproved of these securities or passed upon the
adequacy or accuracy of this prospectus. Any representation to the contrary is
a criminal offense.
The date of this prospectus is , 1999.
<PAGE>
TABLE OF CONTENTS
<TABLE>
<CAPTION>
Page
----
<S> <C>
About This Prospectus..................................................... 3
Forward-Looking Statements................................................ 3
Where You Can Find More Information....................................... 4
Edison International...................................................... 5
The Trusts................................................................ 6
Use of Proceeds........................................................... 7
Ratio of Edison International Earnings to Fixed Charges and Preferred
Stock Dividends.......................................................... 7
Description of Securities................................................. 8
Description of Debt Securities............................................ 8
Description of Edison International's Common Stock and Preferred Stock.... 17
Description of Preferred Securities....................................... 20
Description of Preferred Securities Guarantees............................ 27
Description of Expense Agreements......................................... 29
Relationship Among Preferred Securities, Preferred Securities Guarantees
and Subordinated Debt Securities Held By Each Trust...................... 29
Experts................................................................... 30
Validity of the Securities and the Preferred Securities Guarantees........ 30
Plan of Distribution...................................................... 30
</TABLE>
2
<PAGE>
ABOUT THIS PROSPECTUS
This prospectus is part of a "shelf" registration statement that we filed
with the United States Securities and Exchange Commission, or the "SEC." By
using a shelf registration statement, we may sell up to $2,500,000,000 offering
price of any combination of the securities described in this prospectus from
time to time and in one or more offerings. This prospectus only provides you
with a general description of the securities that we may offer. Each time we
sell securities, we will provide a supplement to this prospectus that contains
specific information about the terms of the securities. The supplement may also
add, update or change information contained in this prospectus. Before
purchasing any securities, you should carefully read both this prospectus and
any supplement, together with the additional information described under the
heading "Where You Can Find More Information."
This prospectus does not contain separate financial statements for the
trusts. Edison International files consolidated financial information with the
SEC that includes each of the trusts. The trusts do not have any independent
function other than to issue securities and to purchase subordinated debt
securities from Edison International. We do not believe that additional
financial information regarding the trusts would be useful to you.
You should rely only on the information contained or incorporated by
reference in this prospectus and in any supplement. We have not authorized any
other person to provide you with different information. If anyone provides you
with different or inconsistent information, you should not rely on it. We will
not make an offer to sell these securities in any jurisdiction where the offer
or sale is not permitted. You should assume that the information appearing in
this prospectus and the supplement to this prospectus is accurate as of the
dates on their covers. Our business, financial condition, results of operations
and prospects may have changed since that date.
FORWARD-LOOKING STATEMENTS
This prospectus, any accompanying prospectus supplement and the additional
information described under the heading "Where You Can Find More Information"
may contain forward-looking statements within the meaning of the Private
Securities Litigation Reform Act of 1995. These statements are subject to risks
and uncertainties and are based on the beliefs and assumptions of our
management, based on information currently available to our management. When we
use words such as "believes," "expects," "anticipates," "intends," "plans,"
"estimates," "should" or similar expressions, we are making forward-looking
statements. Forward-looking statements include the information concerning
possible or assumed future results of operations set forth under "Business" and
"Management's Discussion and Analysis of Financial Condition and Results of
Operations" in our Annual Report on Form 10-K, under the same or similar
headings in our Quarterly Reports on Form 10-Q, and in our Current Reports on
Form 8-K, incorporated by reference into this prospectus.
Forward-looking statements are not guarantees of performance. They involve
risks, uncertainties and assumptions. Our future results and shareholder value
may differ materially from those expressed in these forward-looking statements.
Many of the factors that will determine these results and value are beyond our
ability to control or predict. These statements are necessarily based upon
various assumptions involving judgments with respect to the future including,
among others, our ability to achieve synergies and revenue growth, national,
international, regional and local economic, competitive and regulatory
conditions and developments, technological developments, capital market
conditions, inflation rates, foreign currency exchange rates and valuations,
interest rates, energy markets, weather conditions, business and regulatory or
legal decisions, the pace of deregulation of retail natural gas and
electricity, the timing and extent of changes in commodity prices for oil,
natural gas and electricity, the timing and success of business development
efforts, new or increased
3
<PAGE>
environmental liabilities, the effects of Year 2000-related computer problems,
and other uncertainties, all of which are difficult to predict and many of
which are beyond our control. You are cautioned not to put undue reliance on
any forward-looking statements. For those statements, we claim the protection
of the safe harbor for forward-looking statements contained in the Private
Securities Litigation Reform Act of 1995.
You should also consider any other factors contained in this prospectus or
in any accompanying supplement, including the information incorporated by
reference into this prospectus or into any accompanying supplement.
WHERE YOU CAN FIND MORE INFORMATION
Available Information
Edison International files reports, proxy statements and other information
with the SEC. Information filed with the SEC by Edison International can be
inspected and copied at the Public Reference Room maintained by the SEC and at
the Regional Offices of the SEC as follows:
Public Reference Room New York Regional Office Chicago Regional Office
450 Fifth Street, N.W. 7 World Trade Center Citicorp Center
Room 1024 Suite 1300 500 West Madison Street
Washington, D.C. 20549 New York, New York 10048 Suite 1400
Chicago, Illinois 60661-
2551
You may also obtain copies of this information by mail from the Public
Reference Section of the SEC, 450 Fifth Street, N.W., Room 1024, Washington,
D.C. 20549, at prescribed rates. Further information on the operation of the
SEC's Public Reference Room in Washington, D.C. can be obtained by calling the
SEC at 1-800-SEC-0330.
The SEC also maintains a web site that contains reports, proxy statements
and other information about issuers, such as Edison International, who file
electronically with the SEC. The address of that site is http://www.sec.gov.
Edison International's common stock is listed on the New York Stock
Exchange (NYSE: EIX), and reports, proxy statements and other information
concerning Edison International can also be inspected at the offices of the
New York Stock Exchange at 20 Broad Street, New York, New York 10005. In
addition, reports, proxy statements and other information concerning Edison
International can be inspected at its offices at 2244 Walnut Grove Avenue,
Rosemead, California 91770. You also can obtain copies of some of the above
reports and other information at the web site maintained by Edison
International. The address of that web site is http://www.edison.com.
This prospectus is part of a registration statement that we filed with the
SEC. The full registration statement may be obtained from the SEC or Edison
International, as indicated below. Forms of the indentures, the trust
agreements and other documents establishing the terms of the offered
securities and the guarantees are filed as exhibits to the registration
statement. Statements in this prospectus about these documents are summaries.
You should refer to the actual documents for a more complete description of
the relevant matters.
Incorporation by Reference
The rules of the SEC allow us to "incorporate by reference" information
into this prospectus, which means that we can disclose important information
to you by referring you to another document filed separately with the SEC. The
information incorporated by reference is deemed to be part of this prospectus,
and later information that we file with the SEC will automatically update and
supersede that information. The prospectus incorporates by reference the
documents set forth below that we have previously filed with the SEC. These
documents contain important information about Edison International.
4
<PAGE>
<TABLE>
<CAPTION>
Sec Filings (File No. 1-9936) Period
----------------------------- ------
<S> <C>
Annual Report on Form 10-K Year ended December 31, 1998
Quarterly Report on Form 10-Q Quarter ended March 31, 1999
Current Report on Form 8-K Filed April 5, 1999
Current Report on Form 8-K Filed July 2, 1999
Registration Statement on Form 8-A Filed November 21, 1996
The "Description of Registrant's Filed by SCEcorp (former name of Edison
Securities to be Registered" on International) on May 20, 1988
pages 4-5 of the Registration
Statement on Form 8-B
</TABLE>
We are also incorporating by reference all additional documents that we file
with the SEC under Sections 13(a), 13(c), 14 or 15(d) of the Securities
Exchange Act of 1934, as amended, between the date of this prospectus and the
termination of the offering of securities described in this prospectus.
Upon request, Edison International will provide without charge to each
person to whom a copy of this prospectus has been delivered a copy of any and
all of these filings. You may request a copy of these filings by writing or
telephoning us at:
Edison International
2244 Walnut Grove Avenue
(P.O. Box 999)
Rosemead, California 91770
Attention: Corporate Governance
Telephone: (626) 302-2662
EDISON INTERNATIONAL
Edison International is a multinational corporation and a global leader in
energy production and distribution, and in energy and infrastructure finance.
Headquartered in Rosemead, California, Edison International has regional
offices in New York, Washington, D.C., Australia, Indonesia, the Philippines,
Singapore, Italy, Spain, Turkey and the United Kingdom. Edison International
was incorporated on April 20, 1987, under the laws of the State of California
for the purpose of becoming the parent holding company of Southern California
Edison Company, a California public utility corporation. As of December 31,
1998, Edison International directly or indirectly owned all of the issued and
outstanding common stock of Southern California Edison Company and of other
subsidiaries engaged in nonutility businesses. Edison International's combined
assets total nearly $27 billion.
The regulated utility and the nonutility subsidiaries are:
. Southern California Edison, one of the nation's largest investor-owned
electric utilities, serving approximately 11 million people within an
approximate 50,000-square-mile area in central, coastal and Southern
California. Based in Rosemead, California, the regulated utility is a
recognized leader in cutting-edge research and technology and for
providing reliable electrical service in its region for more than a
century. The company has assets of nearly $17 billion.
. Edison Mission Energy, specializing in the development, acquisition,
construction management and operation of global power production
facilities. Based in Irvine, California, it is among the world's leading
power producers with assets of nearly $7 billion and investments in
approximately 58 projects currently operating in Australia, New Zealand,
Spain, Turkey, the United Kingdom and the United States, and plants
under construction in Australia, Indonesia, Italy, New Zealand,
Thailand, and the United States (Puerto Rico). In total, these projects
represent nearly 15,000 megawatts of generating capacity.
5
<PAGE>
. Edison Capital, a provider of capital and financial services for global
energy, infrastructure and affordable housing projects. Headquartered in
Irvine, California, it has assets of approximately $2.5 billion. The
company has investments in energy and infrastructure projects in the
United States, Latin America, Australia, Europe, Asia and Africa and is
one of the nation's leading investors in affordable housing developments
eligible for tax credits.
. Mission Land Company, which is in the business of managing and selling
real estate projects.
. Edison Enterprises, a provider of products and services for commercial,
retail and utility markets. Based in San Dimas, California, it offers
energy management services for business customers, electrical and
appliance repair and home security services to residential consumers,
and a wide range of services to utilities both in the U.S. and in
Canada.
Edison International is engaged in the business of holding, for investment,
the stock of its subsidiaries. Edison International may, in the future, engage
in other businesses. At year-end 1998, Southern California Edison Company had
13,177 full-time employees. Edison International had 20 full-time employees,
Edison Mission Energy had 1,180 full-time employees, Edison Capital had
85 full-time employees, and Edison Enterprises had 3,888 full-time employees.
The information above concerning Edison International and its subsidiaries
is only a summary and does not purport to be comprehensive. For additional
information concerning Edison International and its subsidiaries, you should
refer to the information described in "Where You Can Find More Information."
The principal executive offices of Edison International are located at 2244
Walnut Grove Avenue, Rosemead, California 91770, and its telephone number is
(626) 302-2222.
THE TRUSTS
Edison International created three Delaware business trusts pursuant to
three trust agreements. The trusts are named EIX Trust I, EIX Trust II and EIX
Trust III. Edison International will enter into an amended and restated trust
agreement (a "Trust Agreement") for each trust, which will state the terms and
conditions for each trust to issue and sell its preferred securities and common
securities. A form of Trust Agreement is filed as an exhibit to the
registration statement of which this prospectus forms a part.
Each trust will exist solely to:
. issue and sell its preferred securities (representing undivided
beneficial interests in the assets of the trust) to the public;
. issue and sell its common securities (representing undivided beneficial
interests in the assets of the trust) to Edison International;
. use the proceeds from the sale of its preferred and common securities to
purchase a series of Edison International's subordinated debt
securities;
. distribute the cash payments it receives on the subordinated debt
securities it owns to the holders of the preferred and common
securities; and
. engage in other activities that are necessary or incidental to these
purposes.
Edison International will purchase all of the common securities of each
trust. The common securities will represent an aggregate liquidation amount
equal to at least 3% of each trust's total capitalization. The preferred
securities will represent the remaining 97% of the trust's total
capitalization. The common securities will have terms substantially identical
to, and will rank equal in priority of payment with, the preferred securities.
However, if Edison International defaults on the related subordinated debt
securities, then cash distributions and liquidation, redemption and other
amounts payable on the common securities will be subordinate in priority of
payment to such amounts payable on the preferred securities.
6
<PAGE>
The preferred securities will be guaranteed by Edison International as
described later in this prospectus.
Edison International has appointed five trustees to conduct each trust's
business and affairs:
. The Chase Manhattan Bank ("property trustee");
. Chase Manhattan Bank Delaware ("Delaware trustee"); and
. Three Edison International officers ("regular trustees").
Except under certain limited circumstances, only Edison International can
remove or replace the trustees. In addition, Edison International can increase
or decrease the number of trustees.
Edison International will pay all fees and expenses related to each trust
and each offering of the related preferred securities and will pay all ongoing
costs and expenses of each trust, except the respective trust's obligations
under the related preferred and common securities.
The trusts will not have separate financial statements. The statements would
not be material to holders of the preferred securities because no trust will
have any independent operations. Each trust exists solely for the reasons
summarized above.
The principal offices of each trust will be located at 2244 Walnut Grove
Avenue, Rosemead, California 91770, and the telephone number of each trust will
be (626) 302-1930.
USE OF PROCEEDS
Unless stated otherwise in the applicable prospectus supplement, the net
proceeds from the sale of the offered securities will be:
. used by Edison International and/or its subsidiaries for general corporate
purposes, including investing in nonutility business activities and reducing
short-term debt incurred to provide interim financing for such purposes; and
. used by the respective trusts to purchase subordinated debt securities of
Edison International.
RATIO OF EDISON INTERNATIONAL EARNINGS TO FIXED CHARGES AND PREFERRED STOCK
DIVIDENDS
The following table sets forth the ratio of Edison International earnings to
combined fixed charges and preferred stock dividends for Edison International
for each of the five years in the five-year period ended December 31, 1998:
<TABLE>
<CAPTION>
Year Ended December 31,
------------------------
1994 1995 1996 1997 1998
---- ---- ---- ---- ----
<S> <C> <C> <C> <C> <C>
Ratio of Earnings to Combined Fixed Charges and
Preferred Stock Dividends........................... 2.48 2.55 2.40 2.39 2.31
Adjusted Ratio of Earnings to Combined Fixed Charges
and Preferred Stock Dividends (1)................... NA NA NA 2.40 2.60
</TABLE>
(1) The following effects of rate reduction notes are excluded from the
adjusted ratios for 1997 and 1998:
<TABLE>
<CAPTION>
1997 1998
---------- ------------
<S> <C> <C>
Income before interest expense...................... $8,142,000 $149,486,000
Interest expense.................................... 8,142,000 149,486,000
</TABLE>
SCE Funding LLC, a special purpose entity, of which Southern California
Edison Company is the sole member, issued approximately $2.5 billion of
these notes in December 1997. For further details you should refer to the
information described in "Where You Can Find More Information" in the
Prospectus, particularly page 46 of Edison International's 1998 Annual
Report to Shareholders.
7
<PAGE>
DESCRIPTION OF SECURITIES
The following is a general description of the terms and provisions of the
securities we may offer and sell by this prospectus. These summaries are not
meant to be a complete description of each security. This prospectus and any
accompanying prospectus supplement will contain the material terms and
conditions for each security. The prospectus supplement may add, update or
change the terms and conditions of the securities as described in this
prospectus. For more information about the securities offered by us, please
refer to:
. the indenture between Edison International and Harris Trust and Savings
Bank, as trustee, relating to the issuance of each series of senior debt
securities by Edison International;
. the indenture ("subordinated indenture") between Edison International
and The Chase Manhattan Bank, as trustee, relating to the issuance of
each series of subordinated debt securities by Edison International;
. the Trust Agreement of each trust; and
. the guarantee agreement between Edison International and The Chase
Manhattan Bank, as trustee, relating to Edison International's guarantee
of the preferred securities issued by each trust.
Forms of these documents are filed as exhibits to the registration
statement. The indentures listed above are sometimes collectively referred to
as the "indentures" and individually referred to as an "indenture." The trustee
under each indenture is referred to as the "indenture trustee." The indentures
are subject to and governed by the Trust Indenture Act of 1939, and may be
supplemented or amended from time to time following their execution.
DESCRIPTION OF DEBT SECURITIES
The following description discusses the general terms and provisions of the
debt securities that Edison International may offer by this prospectus. The
debt securities may be issued as senior debt securities or subordinated debt
securities. Any subordinated debt securities issued by Edison International
will be purchased by a trust and correspond to the series of preferred
securities issued by the trust. The indebtedness represented by the senior debt
securities will rank equally with all other unsecured and unsubordinated debt
of Edison International. The indebtedness represented by the subordinated debt
securities will rank junior and be subordinate in right of payment to the prior
payment in full of the senior debt of Edison International, to the extent and
in the manner set forth in the prospectus supplement for the securities. See
"--Subordination" below.
Each indenture gives us broad authority to set the particular terms of each
series of debt securities, including the right to modify certain of the terms
contained in the indenture. The particular terms of a series of debt securities
and the extent, if any, to which the particular terms of the issue modify the
terms of the indenture will be described in the prospectus supplement relating
to the debt securities.
Each indenture contains the full legal text of the matters described in this
section. Because this section is a summary, it does not describe every aspect
of the debt securities or the applicable indenture. This summary is subject to
and qualified in its entirety by reference to all the provisions of the
applicable indenture, including definitions of terms used in the indenture. We
also include references in parentheses to certain sections of the indentures.
Whenever we refer to particular sections or defined terms of the indentures in
this prospectus or in a prospectus supplement, these sections or defined terms
are incorporated by reference herein or in the prospectus supplement. This
summary also is subject to and qualified by reference to the description of the
particular terms of the debt securities in the applicable prospectus
supplement.
8
<PAGE>
General
We may issue an unlimited amount of debt securities under each indenture in
one or more series. We need not issue all debt securities of one series at the
same time and, unless otherwise provided, we may reopen a series, without the
consent of the holders of the debt securities of that series, for issuances of
additional debt securities of that series.
The debt securities will be unsecured obligations.
Prior to the issuance of each series of debt securities, the terms of the
particular securities will be specified in a supplemental indenture (including
any pricing supplement) and a board resolution of Edison International or in
one or more officer's certificates of Edison International pursuant to a
supplemental indenture or a board resolution. We refer you to the applicable
prospectus supplement for a description of the following terms of the series of
debt securities:
(a) the title of the debt securities;
(b) any limit upon the principal amount of the debt securities;
(c) the date or dates on which principal will be payable or how to
determine the dates;
(d) the rate or rates or method of determination of interest; the date
from which interest will accrue; the dates on which interest will be
payable, which we refer to as the "interest payment dates;" and any record
dates for the interest payable on the interest payment dates;
(e) any obligation or option of Edison International to redeem, purchase
or repay debt securities, or any option of the registered holder to require
Edison International to redeem or repurchase debt securities, and the terms
and conditions upon which the debt securities will be redeemed, purchased
or repaid;
(f) the denominations in which the debt securities will be issuable (if
other than denominations of $1,000 and any integral multiple thereof);
(g) any provision relating to deferral of interest payments;
(h) whether the debt securities are to be issued in whole or in part in
the form of one or more global debt securities and, if so, the identity of
the depositary for the global debt securities; and
(i) any other terms of the debt securities.
(See Section 301.)
Payment of Debt Securities--Interest
Unless indicated differently in a prospectus supplement, we will pay
interest on the debt security on each interest payment date to the person in
whose name the debt security is registered as of the close of business on the
regular record date relating to the interest payment date.
However, if we default in paying interest on a debt security, we will pay
defaulted interest in either of the two following ways:
(a) We will first propose to the indenture trustee a payment date for
the defaulted interest. Next, the indenture trustee will choose a special
record date for determining which registered holders are entitled to the
payment. The special record date will be between 10 and 15 days before the
payment date we propose. Finally, we will pay the defaulted interest on the
payment date to the registered holder of the debt security as of the close
of business on the special record date.
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<PAGE>
(b) Alternatively, we can propose to the indenture trustee any other
lawful manner of payment that is consistent with the requirements of any
securities exchange on which the debt securities are listed for trading. If
the indenture trustee thinks the proposal is practicable, payment will be
made as proposed.
(See Section 307.)
Payment of Debt Securities--Principal
Unless we indicate differently in a prospectus supplement, we will pay
principal of and any premium on the debt securities at stated maturity, upon
redemption or otherwise, upon presentation of the debt securities at the office
of the indenture trustee, as our paying agent. Any other paying agent initially
designated for the debt securities of a particular series will be named in the
applicable prospectus supplement.
In our discretion, we may change the place of payment on the debt
securities, and may remove any paying agent and may appoint one or more
additional paying agents. (See Section 1002.)
Form; Transfers; Exchanges
The debt securities will be issued
(a) only in fully registered form;
(b) without interest coupons; and
(c) unless otherwise specified in a prospectus supplement, in
denominations that are integral multiples of $1,000.
You may have your debt securities divided into debt securities of smaller
denominations (of at least $1,000) or combined into debt securities of larger
denominations, as long as the total principal amount is not changed. This is
called an "exchange."
You may exchange or transfer debt securities at the office of the indenture
trustee. The indenture trustee acts as our agent for registering debt
securities in the names of holders and transferring debt securities. We may
appoint another agent or act as our own agent for this purpose. The entity
performing the role of maintaining the list of registered holders is called the
"security registrar." It will also perform transfers.
In our discretion, we may change the place for registration of transfer of
the debt securities and may remove and/or appoint one or more additional
security registrars. (See Sections 305 and 1002.)
Except as otherwise provided in a prospectus supplement, there will be no
service charge for any transfer or exchange of the debt securities, but you may
be required to pay a sum sufficient to cover any tax or other governmental
charge payable in connection with the transfer or exchange. We may block the
transfer or exchange of (a) debt securities during a period of 15 days prior to
giving any notice of redemption or (b) any debt security selected for
redemption in whole or in part, except the unredeemed portion of any debt
security being redeemed in part. (See Section 305.)
Redemption
We will set forth any terms for the redemption of debt securities in a
prospectus supplement. Unless we indicate differently in a prospectus
supplement, and except with respect to debt securities redeemable at the option
of the registered holder, debt securities will be redeemable upon notice by
mail between 30 and 60 days prior to the redemption date. If less than all of
the debt securities of any series or any tranche of a series are to be
redeemed, the indenture trustee will select the debt securities to be redeemed.
In the absence of any provision for selection, the indenture trustee will
choose a method of random selection it deems fair and appropriate. (See
Sections 1102, 1103 and 1104.)
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<PAGE>
Debt securities will cease to bear interest on the redemption date. We will
pay the redemption price and any accrued interest once you surrender the debt
security for redemption. (See Section 1105.) If only part of a debt security is
redeemed, the indenture trustee will deliver to you a new debt security of the
same series for the remaining portion without charge. (Section 1106.)
We may make any redemption conditional upon the receipt by the paying agent,
on or prior to the date fixed for redemption, of money sufficient to pay the
redemption price. If the paying agent has not received the money by the date
fixed for redemption, we will not be required to redeem the debt securities.
(See Section 1104.)
Events of Default
An "event of default" occurs with respect to debt securities of any series
if:
(a) we do not pay any interest on any debt securities of the applicable
series within 30 days of the due date (following any deferral allowed under
the terms of the debt securities and elected by us);
(b) we do not pay principal or premium on any debt securities of the
applicable series on its due date;
(c) we remain in breach of a covenant or warranty (excluding covenants
and warranties not applicable to the affected series) of the indenture for
90 days after we receive a written notice of default stating we are in
breach and requiring remedy of the breach; the notice must be sent by
either the indenture trustee or registered holders of at least 25% of the
principal amount of debt securities of the affected series;
(d) we file for bankruptcy or other specified events in bankruptcy,
insolvency, receivership or reorganization occur; or
(e) any other event of default specified in the prospectus supplement
occurs.
(See Section 501.)
No event of default with respect to a series of debt securities necessarily
constitutes an event of default with respect to the debt securities of any
other series issued under the indenture.
Remedies
Acceleration
If an event of default occurs and is continuing with respect to any series
of debt securities, then either the indenture trustee or the registered holders
of not less than 25% in principal amount of the outstanding debt securities of
that series may declare the principal amount of all of the debt securities of
that series to be due and payable immediately. (See Section 502.)
Rescission of Acceleration
After the declaration of acceleration has been made and before the indenture
trustee has obtained a judgment or decree for payment of the money due on any
series of debt securities, the registered holders of not less than a majority
in aggregate principal amount of the outstanding debt securities of that series
may rescind and annul the declaration and its consequences, if
(a) we pay or deposit with the indenture trustee a sum sufficient to pay
(1) all overdue interest;
(2) the principal of and any premium which have become due other
than by the declaration of acceleration and overdue interest on these
amounts;
11
<PAGE>
(3) interest on overdue interest to the extent lawful;
(4) all amounts due to the indenture trustee under the indenture; and
(b) all events of default with respect to the affected series, other
than the nonpayment of the principal which has become due solely by the
declaration of acceleration, have been cured or waived as provided in the
indenture.
(See Section 502.)
For more information as to waiver of defaults, see "Waiver of Default and
of Compliance" below.
Control by Registered Holders; Limitations
Subject to the indenture, if an event of default with respect to the debt
securities of any series occurs and is continuing, the registered holders of a
majority in principal amount of the outstanding debt securities of that series
will have the right to
(a) direct the time, method and place of conducting any proceeding for
any remedy available to the indenture trustee, or
(b) exercise any trust or power conferred on the indenture trustee with
respect to the debt securities of the series.
If an event of default is continuing with respect to all the series of debt
securities, the registered holders of a majority in aggregate principal amount
of the outstanding debt securities of all the series, considered as one class,
will have the right to make such direction, and not the registered holders of
the debt securities of any one of the series. These rights of registered
holders to make direction are subject to the following limitations:
(a) the registered holders' directions will not conflict with any law or
the indenture; and
(b) the registered holders' directions may not involve the indenture
trustee in personal liability where the indenture trustee believes
indemnity is not adequate.
The indenture trustee may also take any other action it deems proper which
is consistent with the registered holders' direction. (See Sections 512 and
603.)
In addition, the indenture provides that no registered holder of any debt
security of any series will have any right to institute any proceeding,
judicial or otherwise, with respect to the indenture for the appointment of a
receiver or for any other remedy under the indenture unless
(a) that registered holder has previously given the indenture trustee
written notice of a continuing event of default;
(b) the registered holders of not less than 25% in aggregate principal
amount of the outstanding debt securities of all the series, considered as
one class, or, in the case of an event of default of the character
specified above in clause (a) or (b) under "Events of Default," that
series, have made written request to the indenture trustee to institute
proceedings in respect of that event of default and have offered the
indenture trustee indemnity satisfactory to it against costs and
liabilities incurred in complying with the request; and
(c) for 60 days after receipt of the notice, the indenture trustee has
failed to institute a proceeding and no direction inconsistent with the
request has been given to the indenture trustee during the 60-day period by
the registered holders of a majority in aggregate principal amount of
outstanding debt securities of all the series, considered as one class, or,
in the case of an event of default of the character specified above in
clause (a) or (b) under "Events of Default," that series.
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<PAGE>
Furthermore, no registered holder will be entitled to institute any action if
and to the extent that the action would disturb or prejudice the rights of
other registered holders. (See Sections 507 and 603.)
However, each registered holder has an absolute and unconditional right to
receive payment when due and to bring a suit to enforce that right. (See
Sections 507 and 508.)
Notice of Default
The indenture trustee is required to give the registered holders of the debt
securities notice of any default under the indenture to the extent required by
the Trust Indenture Act, unless the default has been cured or waived; except
that in the case of an event of default of the character specified above in
clause (c) under "Events of Default," no notice shall be given to the
registered holders until at least 30 days after the occurrence thereof. (See
Section 602.) The Trust Indenture Act currently permits the indenture trustee
to withhold notices of default (except for certain payment defaults) if the
indenture trustee in good faith determines the withholding of the notice to be
in the interests of the registered holders.
We will furnish the indenture trustee with an annual statement as to our
compliance with the conditions and covenants in the indenture. (See Section
1005.)
Waiver of Default and of Compliance
The registered holders of a majority in aggregate principal amount of the
outstanding debt securities of all affected series (voting as one class) may
waive, on behalf of the registered holders of all debt securities of all such
series, any past default under the indenture, except a default in the payment
of principal, premium or interest, or with respect to compliance with certain
provisions of the indenture that cannot be amended without the consent of the
registered holder of each outstanding debt security. (See Section 513.)
Compliance with some of the covenants in the indenture or otherwise provided
with respect to debt securities may be waived by the registered holders of a
majority in aggregate principal amount of the affected debt securities,
considered as one class. (See Section 1006.)
Consolidation, Merger and Conveyance of Assets as an Entirety; No Financial
Covenants
Subject to the provisions described in the next paragraph, Edison
International will preserve its corporate existence. (See Section 1004.)
Edison International has agreed not to consolidate with or merge into any
other entity and not to convey, transfer or lease its properties and assets
substantially as an entirety to any entity, unless:
(a) the entity formed by the consolidation or into which Edison
International is merged, or the entity which acquires or which leases the
property and assets of Edison International substantially as an entirety,
is an entity organized and existing under the laws of the United States of
America or any State of the United States or the District of Columbia, and
expressly assumes, by supplemental indenture, the due and punctual payment
of the principal, premium and interest on all the outstanding debt
securities and the performance of all of the covenants of Edison
International under the indenture, and
(b) immediately after giving effect to the transactions, no event of
default, and no event which after notice or lapse of time or both would
become an event of default, will have occurred and be continuing.
(See Section 801.)
The indenture contains no financial or other similar restrictive covenants.
Any such covenants with respect to any particular series of debt securities
will be set forth in the applicable prospectus supplement.
13
<PAGE>
Modification of Indenture
Without Registered Holder Consent. Without the consent of any registered
holders of debt securities, we and the applicable indenture trustee may enter
into one or more supplemental indentures for any of the following purposes:
(a) to evidence the succession of another entity to Edison
International; or
(b) to add one or more covenants of Edison International or other
provisions for the benefit of the registered holders of all or any series
or tranche of debt securities, or to surrender any right or power conferred
upon Edison International; or
(c) to add any additional events of default for all or any series of
debt securities; or
(d) to change or eliminate any provision of the indenture or to add any
new provision to the indenture that does not adversely affect the interests
of the registered holders; or
(e) to provide security for the debt securities of any series; or
(f) to establish the form or terms of debt securities of any series or
tranche or any debt securities guarantees as permitted by the indenture; or
(g) to provide for the issuance of bearer securities; or
(h) to evidence and provide for the acceptance of appointment of a
separate or successor indenture trustee; or
(i) to provide for the procedures required to permit the utilization of
a noncertificated system of registration for any series or tranche of debt
securities; or
(j) to change any place or places where
(1) we may pay principal, premium and interest,
(2) debt securities may be surrendered for transfer or exchange, or
(3) notices and demands to or upon Edison International may be
served; or
(k) to cure any ambiguity, defect or inconsistency or to make any other
changes that do not adversely affect the interests of the registered
holders in any material respect.
(See Section 901.)
If the Trust Indenture Act is amended after the date of the indenture so as
to require changes to the indenture or so as to permit changes to, or the
elimination of, provisions which, at the date of the indenture or at any time
thereafter, were required by the Trust Indenture Act to be contained in the
indenture, the indenture will be deemed to have been amended so as to conform
to the amendment or to effect the changes or elimination, and Edison
International and the applicable indenture trustee may, without the consent of
any registered holders, enter into one or more supplemental indentures to
effect or evidence the amendment.
With Registered Holder Consent. We and the indenture trustee may, with some
exceptions, amend or modify any indenture with the consent of the registered
holders of at least a majority in aggregate principal amount of the debt
securities of all series affected by the amendment or modification (voting as
one class). However, no amendment or modification may, without the consent of
the registered holder of each outstanding debt security affected thereby,
(a) change the stated maturity of the principal or interest on any debt
security (other than pursuant to the terms of the debt security), or reduce
the principal amount, interest or premium payable or change the currency in
which any debt security is payable, or impair the right to bring suit to
enforce any payment;
14
<PAGE>
(b) reduce the percentages of registered holders whose consent is
required for any supplemental indenture or waiver or reduce the
requirements for quorum and voting under the indenture; or
(c) modify certain of the provisions in the indenture relating to
supplemental indentures and waivers of certain covenants and past defaults.
A supplemental indenture which changes or eliminates any provision of the
indenture expressly included solely for the benefit of registered holders of
debt securities of one or more particular series or tranches will be deemed not
to affect the rights under the indenture of the registered holders of debt
securities of any other series or tranche. (See Section 902.)
Miscellaneous
The indenture provides that some debt securities, including those for which
payment or redemption money has been deposited or set aside in trust, will not
be deemed to be "outstanding" in determining whether the registered holders of
the requisite principal amount of the outstanding debt securities have given or
taken any demand, direction, consent or other action under the indenture as of
any date, or are present at a meeting of registered holders for quorum
purposes. (See Section 101.)
We will be entitled to set any day as a record date for the purpose of
determining the registered holders of outstanding debt securities of any series
entitled to give or take any demand, direction, consent or other action under
the indenture, in the manner and subject to the limitations provided in the
indenture. In some circumstances, the indenture trustee also will be entitled
to set a record date for action by registered holders. If a record date is set
for any action to be taken by registered holders of particular debt securities,
the action may be taken only by persons who are registered holders of the
respective debt securities on the record date. (See Section 104.)
Defeasance and Covenant Defeasance
The indentures provide, unless the terms of the particular series of debt
securities provide otherwise, that we may, upon satisfying several conditions,
cause ourselves to be:
(a) discharged from our obligations, with some exceptions, with respect
to any series of debt securities, which we refer to as "defeasance"; and
(b) released from our obligations under specified covenants with respect
to any series of debt securities, which we refer to as "covenant
defeasance."
One condition we must satisfy is the irrevocable deposit with the indenture
trustee, in trust, of money and/or government obligations which, through the
scheduled payment of principal and interest on those obligations, would provide
sufficient moneys to pay the principal of and any premium and interest on those
debt securities on the maturity dates of the payments or upon redemption.
The indentures permit defeasance with respect to any series of debt
securities even if a prior covenant defeasance has occurred with respect to the
debt securities of that series. Following a defeasance, payment of the debt
securities defeased may not be accelerated because of an event of default.
Following a covenant defeasance, payment of the debt securities may not be
accelerated by reference to the specified covenants affected by the covenant
defeasance. However, if an acceleration were to occur, the realizable value at
the acceleration date of the money and government obligations in the defeasance
trust could be less than the principal and interest then due on the respective
debt securities, since the required deposit in the defeasance trust would be
based upon scheduled cash flows rather than market value, which would vary
depending upon interest rates and other factors.
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<PAGE>
Under current United States federal income tax law, the defeasance
contemplated in the preceding paragraphs would be treated as an exchange of the
relevant debt securities in which holders of the debt securities might
recognize gain or loss. In addition, the amount, timing and character of
amounts that holders would be required after the defeasance to include in
income might be different from that which would be includible in the absence of
the defeasance. Prospective investors are urged to consult their own tax
advisors as to the specific consequences of a defeasance, including the
applicability and effect of tax laws other than United States federal income
tax laws.
Under current United States federal income tax laws, unless accompanied by
other changes in the terms of the debt securities, covenant defeasance
generally should not be treated as a taxable exchange.
Resignation and Removal of the Indenture Trustee; Deemed Resignation
The indenture trustee may resign at any time by giving written notice to us.
The indenture trustee may also be removed by act of the registered holders
of a majority in principal amount of the then outstanding debt securities of
any series.
No resignation or removal of the indenture trustee and no appointment of a
successor indenture trustee will become effective until the acceptance of
appointment by a successor indenture trustee in accordance with the
requirements of the indenture.
Under some circumstances, we may appoint a successor indenture trustee and,
if the successor accepts, the indenture trustee will be deemed to have
resigned.
(Section 610).
Subordination
Unless we indicate differently in a prospectus supplement, any subordinated
debt securities will be subordinated in the following manner. If Edison
International's assets are distributed upon our dissolution, winding up,
liquidation or reorganization, the payment of the principal of, premium, if
any, and interest on any subordinated debt securities will be subordinated, to
the extent provided in the subordinated indenture and the applicable
supplemental indenture, to the prior payment in full of all senior
indebtedness, including senior debt securities. However, Edison International's
obligation to pay principal, and premium, if any, or interest on the
subordinated debt securities will not otherwise be affected. No payment on
account of principal, or premium, if any, sinking fund or interest may be made
on the subordinated debt securities at any time when there is a default in the
payment of principal, premium, if any, sinking fund or interest on senior
indebtedness. If, while Edison International is in default on senior
indebtedness, any payment is received by the indenture trustee under the
subordinated debt security indenture or the holders of any of the subordinated
debt securities before it has paid all senior indebtedness in full, the payment
or distribution must be paid over to the holders of the unpaid senior
indebtedness or applied to the repayment of the unpaid senior indebtedness.
Subject to paying the senior indebtedness in full, the holders of the
subordinated debt securities will be subrogated to the rights of the holders of
the senior indebtedness to the extent that payments are made to the holders of
senior indebtedness out of the distributive share of the subordinated debt
securities.
Due to the subordination, if Edison International's assets are distributed
upon insolvency, some or all of its general creditors may recover more,
ratably, than holders of subordinated debt securities. The subordinated
indenture or applicable supplemental indenture may state that its subordination
16
<PAGE>
provisions will not apply to money and securities held in trust under the
satisfaction and discharge, and the legal defeasance provisions of the
subordinated indenture.
If this prospectus is being delivered in connection with the offering of a
series of subordinated debt securities, the accompanying prospectus supplement
or the information incorporated by reference in it will set forth the
approximate amount of senior indebtedness outstanding as of a recent date.
Conversion Rights
The terms and conditions of any debt securities being offered that are
convertible into common stock of Edison International will be set forth in a
prospectus supplement. These terms will include the conversion price, the
conversion period, provisions as to whether conversion will be at the option of
the holder or us, the events requiring an adjustment of the conversion price
and provisions affecting conversion in the event that the debt securities are
redeemed.
Governing Law
The subordinated indenture and the related debt securities will be governed
by and construed in accordance with the laws of the State of California, except
that the rights, duties, immunities and indemnities of the indenture trustee
will be governed by the laws of the State of New York.
The senior indenture and the related debt securities will be governed by and
construed in accordance with the laws of the State of California.
DESCRIPTION OF EDISON INTERNATIONAL'S
COMMON STOCK AND PREFERRED STOCK
The following description of Edison International's common stock and
preferred stock is only a summary and is qualified in its entirety by reference
to the articles of incorporation and bylaws of Edison International. Therefore,
you should read carefully the more detailed provisions of Edison
International's Restated Articles of Incorporation, Edison International's
Amended Bylaws, and Edison International's Rights Agreement, dated November 21,
1996, between Edison International and Harris Trust Company of California, as
rights agent, copies of which are incorporated by reference as exhibits to the
registration statement of which this prospectus is a part.
General
The authorized capital stock of Edison International consists of (1)
800,000,000 shares of Edison International common stock, without par value, and
(2) 50,000,000 shares of preferred stock, without par value. As of March 31,
1999, there were issued and outstanding 347,207,697 shares of Edison
International common stock and no shares of Edison International preferred
stock. No other classes of capital stock are authorized under the Edison
International articles of incorporation. The issued and outstanding shares of
Edison International common stock are duly authorized, validly issued, fully
paid, nonassessable and free of preemptive rights.
Edison International Common Stock
The holders of Edison International common stock are entitled to receive
such dividends as the Edison International board of directors may from time to
time declare, subject to any rights of holders of outstanding shares of Edison
International preferred stock. Except as otherwise provided by law, each holder
of Edison International common stock is entitled to one vote per share on each
matter
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submitted to a vote of a meeting of shareholders, subject to any class or
series voting rights of holders of Edison International preferred stock.
In the event of any liquidation, dissolution or winding up of Edison
International, whether voluntary or involuntary, the holders of shares of
Edison International common stock, subject to any rights of the holders of
outstanding shares of Edison International preferred stock, are entitled to
receive any remaining assets of Edison International after the discharge of its
liabilities.
Holders of Edison International common stock are not entitled to preemptive
rights to subscribe for or purchase any part of any new or additional issue of
stock or securities convertible into stock. Edison International common stock
does not contain any redemption provisions or conversion rights and is not
liable to assessment or further call.
Each outstanding share of Edison International common stock is accompanied
by a right to purchase one one-thousandth of a share of Series A Junior
Participating Cumulative Preferred Stock, without par value, of Edison
International at a price of $55.00 per right, subject to certain anti-dilution
adjustments. The Edison International board of directors has reserved 3,000,000
shares of such Series A preferred stock for issuance upon exercise of the
rights, as more fully discussed below under the heading "--Description of
Preferred Share Purchase Rights."
The registrar and transfer agent for the Edison International common stock
is Southern California Edison Company.
Preferred Stock
The Edison International board of directors is authorized, pursuant to the
Edison International articles of incorporation, to issue up to 50,000,000
shares of Edison International preferred stock in one or more series and to fix
the number of shares of any series of preferred stock, to determine the
designation of any such series, to increase or decrease the number of shares of
any such series subsequent to the issue of shares of that series, and to
determine or alter the rights, preferences, privileges and restrictions granted
to or imposed upon any wholly unissued series of preferred stock. As of March
31, 1999, there were no shares of Edison International preferred stock
outstanding. However, the Edison International board of directors has reserved
3,000,000 shares of Series A preferred stock for issuance in connection with
rights issued under the Edison International rights agreement.
Prior to the issuance of shares of each series of preferred stock, the board
of directors is required to adopt resolutions and file a certificate of
determination with the Secretary of State of the State of California (other
than the Series A preferred stock, for which those actions have been taken
previously). The certificate of determination will fix for each series the
designation and number of shares and the rights, preferences, privileges and
restrictions of the shares including, but not limited to, the following:
(a) the title and stated value of the preferred stock;
(b) voting rights, if any, of the preferred stock;
(c) any rights and terms of redemption (including sinking fund
provisions);
(d) the dividend rate(s), period(s) and/or payment date(s) or method(s)
of calculation applicable to the preferred stock;
(e) whether dividends are cumulative or non-cumulative and, if
cumulative, the date from which dividends on the preferred stock will
accumulate;
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(f) the relative ranking and preferences of the preferred stock as to
dividend rights and rights upon the liquidation, dissolution or winding up
of our affairs;
(g) the terms and conditions, if applicable, upon which the preferred
stock will be convertible into common stock, including the conversion price
(or manner of calculation) and conversion period;
(h) the provision for redemption, if applicable, of the preferred stock;
(i) the provisions for a sinking fund, if any, for the preferred stock;
(j) liquidation preferences;
(k) any limitations on issuance of any class or series of preferred
stock ranking senior to or on a parity with the class or series of
preferred stock as to dividend rights and rights upon liquidation,
dissolution or winding up of our affairs; and
(l) any other specific terms, preferences, rights, limitations or
restrictions of the preferred stock.
All shares of preferred stock will, when issued, be fully paid and
nonassessable and will not have any preemptive or similar rights.
In addition to the terms listed above, we will set forth in a prospectus
supplement the following terms relating to the class or series of preferred
stock being offered:
(a) the number of shares of the preferred stock offered, the liquidation
preference per share and the offering price of the preferred stock;
(b) the procedures for auction and remarketing, if any, for the
preferred stock;
(c) any listing of the preferred stock on any securities exchange; and
(d) a discussion of any material and/or special United States federal
income tax considerations applicable to the preferred stock.
Rank
Unless we specify otherwise in the applicable prospectus supplement, the
preferred stock will rank, with respect to dividends and upon our liquidation,
dissolution or winding up:
(a) senior to all classes or series of our common stock and to all of
our equity securities ranking junior to the preferred stock;
(b) on a parity with all of our equity securities the terms of which
specifically provide that the equity securities rank on a parity with the
preferred stock; and
(c) junior to all of our equity securities the terms of which
specifically provide that the equity securities rank senior to the
preferred stock.
Description of Preferred Share Purchase Rights
On November 21, 1996, the Edison International board of directors adopted a
preferred share purchase rights plan providing that one preferred share
purchase right will attach to each share of Edison International common stock.
The description and terms of the rights are set forth in a rights agreement,
dated as of November 21, 1996, by and between Edison International and Harris
Trust Company of California, as rights agent. The purchase rights have an anti-
takeover effect that is intended to discourage coercive or unfair takeover
tactics and to encourage any potential acquirer to negotiate a fair price to
all Edison International shareholders. The purchase rights may cause
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substantial dilution to any party that may attempt to acquire Edison
International on terms not approved by the Edison International board of
directors. However, the purchase rights are structured in a way so as not to
interfere with any negotiated merger or other business combination. The rights
will expire on November 21, 2006. Until a right is exercised, the holder of the
right will have no rights as a shareholder of Edison International beyond those
rights afforded to existing shareholders, including the right to vote or to
receive dividends.
The rights are designed to assure that all of Edison International's
shareholders receive fair and equal treatment in the event of any proposed
takeover of Edison International and to guard against partial tender offers,
open market accumulations and other abusive tactics that may be deployed to
gain control of Edison International without a control premium paid to all
shareholders. Any time prior to the first date that a person or group has
become an "acquiring person" as defined in the rights agreement, the rights
should not interfere with any merger or other business combination as long as
it is approved by the Edison International board of directors.
Anti-Takeover Provisions
The Edison International articles of incorporation and bylaws contain
provisions that may have the effect of discouraging persons from acquiring
large blocks of Edison International stock or delaying or preventing a change
in control of Edison International. The material provisions which may have such
an effect are:
(a) a provision permitting the Edison International board of directors
to amend or repeal the Edison International bylaws, except that provisions
of the bylaws specifying or changing a fixed number of directors or the
maximum or minimum number or changing from a fixed to a variable board of
directors or vice versa may only be adopted by approval of outstanding
shares;
(b) authorization for the Edison International board of directors to
issue Edison International preferred stock in series and to fix rights and
preferences of the series (including, among other things, whether, and to
what extent, the shares of any series will have voting rights and the
extent of the preferences of the shares of any series with respect to
dividends and other matters); and
(c) a provision requiring the approval of holders of at least 80% of the
outstanding voting shares of Edison International for such acquisition or
change of control unless either a majority of the disinterested directors
of the Edison International board of directors approves such acquisition or
change of control or the consideration received in connection with such
acquisition or change of control equals at least the fair market value of
the capital stock of Edison International.
Some acquisitions of Edison International's outstanding voting shares would
also require approval of the SEC under the Public Utility Holding Company Act
of 1935 and of various federal, state and foreign regulatory authorities.
DESCRIPTION OF PREFERRED SECURITIES
General
Each Trust Agreement authorizes the regular trustees to issue on behalf of
each trust one series of preferred securities which will have the terms
described in a prospectus supplement. The proceeds from the sale of a trust's
preferred and common securities will be used by the trust to purchase a series
of subordinated debt securities issued by Edison International. The
subordinated debt securities will be held in trust by the property trustee for
the benefit of the holders of the preferred and common securities.
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Under each preferred securities guarantee, Edison International will agree
to make payments of distributions and payments on redemption or liquidation
with respect to a trust's preferred securities, but only to the extent the
trust has funds available to make those payments and has not made the payments.
See "Description of Preferred Securities Guarantees."
The assets of a trust available for distribution to the holders of its
preferred securities will be limited to payments from Edison International
under the series of subordinated debt securities held by the trust. If Edison
International fails to make a payment on the subordinated debt securities, the
trust will not have sufficient funds to make related payments, including
distributions, on its preferred securities.
Each preferred securities guarantee, when taken together with Edison
International's obligations under the related series of subordinated debt
securities, the subordinated indenture, the related Trust Agreement and the
related expense agreement (as described below), will provide a full and
unconditional guarantee by Edison International of amounts due on the preferred
securities issued by a trust.
Each Trust Agreement will be qualified as an indenture under the Trust
Indenture Act. Each property trustee will act as indenture trustee for the
preferred securities to be issued by the applicable trust, in order to comply
with the provisions of the Trust Indenture Act.
Each series of preferred securities will have the terms, including those
regarding distributions, redemption, voting, liquidation rights and the other
preferred, deferred or other special rights or other restrictions, as described
in the relevant Trust Agreement or made part of the Trust Agreement by the
Trust Indenture Act or the Delaware Business Trust Act. The terms of the
preferred securities will mirror the terms of the subordinated debt securities
held by the trust.
The prospectus supplement relating to the preferred securities of a trust
will describe the specific terms of the preferred securities, including:
(a) the name of the preferred securities;
(b) the dollar amount and number of securities issued;
(c) any provision relating to deferral of distribution payments;
(d) the annual distribution rate(s), or method of determining the
rate(s), the payment date(s) and the record dates used to determine the
holders who are to receive distributions;
(e) the date from which distributions will be cumulative;
(f) the optional redemption provisions, if any, including the prices,
time periods and other terms and conditions for which the preferred
securities will be purchased or redeemed, in whole or in part;
(g) the terms and conditions, if any, upon which the applicable series
of subordinated debt securities may be distributed to holders of the
preferred securities;
(h) the voting rights, if any, of holders of the preferred securities;
(i) any securities exchange on which the preferred securities will be
listed;
(j) whether the preferred securities are to be issued in book-entry form
and represented by one or more global certificates and, if so, the
depository for the global certificates and the specific terms of the
depositary arrangements; and
(k) any other relevant rights, preferences, privileges, limitations or
restrictions of the preferred securities.
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Each prospectus supplement will describe various United States federal
income tax considerations applicable to the purchase, holding and disposition
of the series of preferred securities covered by the prospectus supplement.
Liquidation Distribution Upon Dissolution
Unless otherwise specified in an applicable prospectus supplement, each
Trust Agreement states that the related trust shall be dissolved:
(a) on the expiration of the term of the trust;
(b) upon the bankruptcy, dissolution or liquidation of Edison
International;
(c) upon direction by Edison International to the property trustee to
dissolve the trust and distribute the related subordinated debt securities
directly to the holders of the preferred and common securities of the
trust;
(d) upon the redemption of all of the common and preferred securities of
the trust in connection with the redemption of all of the related
subordinated debt securities; or
(e) upon entry of a court order for the dissolution of the trust.
Unless otherwise specified in an applicable prospectus supplement, in the
event of a dissolution as described in (a), (b), (c) or (e) above, after the
trust satisfies all liabilities to its creditors as provided by applicable law,
each holder of the preferred or common securities will be entitled to receive:
(a) the related subordinated debt securities in an aggregate principal
amount equal to the aggregate liquidation amount of the preferred or common
securities held by the holder; or
(b) if such a distribution of related subordinated debt securities is
determined by the property trustee not to be practical, cash equal to the
aggregate liquidation amount of the preferred or common securities held by
the holder, plus accumulated and unpaid distributions to the date of
payment.
If the trust cannot pay the full amount due on its preferred and common
securities because insufficient assets are available for payment, then the
amounts payable by the trust on its preferred and common securities will be
paid on a pro rata basis. However, if an event of default under the related
subordinated indenture has occurred and is continuing, the total amounts due on
the preferred securities will be paid before any distribution on the common
securities.
Events of Default
An "event of default" under the Trust Agreement (a "Trust Agreement event of
default") occurs if: (a) an event of default under the subordinated indenture
relating to a series of subordinated debt securities occurs or (b) any other
event of default specified in the prospectus supplement occurs. See
"Description of Debt Securities--Events of Default."
Edison International and the regular trustees of a trust must file annually
with the property trustee for the trust a certificate stating whether or not
they are in compliance with all the applicable conditions and covenants under
the related Trust Agreement.
If an event of default occurs under the subordinated indenture, and the
indenture trustee and the holders of not less than 25% in principal amount of
the related subordinated debt securities outstanding fail to declare the
principal of all of such subordinated debt securities to be immediately due and
payable, the holders of at least 25% in aggregate liquidation amount of the
outstanding
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preferred securities of the applicable trust will have the right to declare
such principal immediately due and payable, by providing notice to Edison
International and the indenture trustee.
If Edison International fails to pay principal, premium, if any, or interest
on a series of subordinated debt securities when payable, then a holder of the
related preferred securities may directly sue Edison International to collect
its pro rata share of payments owed.
Consolidation, Merger or Amalgamation of the Trusts
A trust may not consolidate, amalgamate, merge with or into, or be replaced
by or convey, transfer or lease its properties and assets substantially as an
entirety to any corporation or other body ("Merger Event"), except as described
below or as described in "Liquidation Distribution Upon Dissolution." A trust
may, with the consent of the holders of at least a majority in aggregate
liquidation amount of its outstanding preferred securities, consolidate,
amalgamate, merge with or into, or be replaced by or convey, transfer or lease
its properties and assets substantially as an entirety to another trust, if:
(a) the successor entity either
(1) expressly assumes all of the obligations of the trust relating
to its preferred securities; or
(2) substitutes for the trust's preferred securities other
securities having substantially the same terms as the preferred
securities ("successor securities"), so long as the successor
securities rank the same as the preferred securities for distributions
and payments upon liquidation, redemption and otherwise;
(b) Edison International expressly appoints a trustee of the successor
entity who has the same powers and duties as the property trustee of the
trust as the holder of the particular series of subordinated debt
securities;
(c) the preferred securities are listed or traded, or any successor
securities will be listed upon notice of issuance, on the same national
securities exchange or other organization on which the preferred securities
are then listed or traded;
(d) the Merger Event does not cause the preferred securities or any
successor securities to be downgraded by any national rating agency;
(e) the Merger Event does not adversely affect the rights, preferences
and privileges of the holders of the preferred securities or any successor
securities in any material way;
(f) the successor entity has a purpose substantially identical to that
of the trust;
(g) prior to the Merger Event, Edison International has received an
opinion of counsel from a nationally recognized law firm stating that:
(1) the Merger Event does not adversely affect the rights,
preferences and privileges of the holders of the trust's preferred
securities or any successor securities in any material way; and
(2) following the Merger Event, neither the trust nor the successor
entity will be required to register as an investment company under the
Investment Company Act of 1940, as amended; and
(h) Edison International owns all of the common securities of the
successor entity and guarantees the obligations of the successor entity
under the successor securities at least to the extent provided under the
applicable preferred securities guarantee.
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In addition, unless all of the holders of the preferred securities approve
otherwise, a trust may not consolidate, amalgamate, merge with or into, or be
replaced by or convey, transfer or lease its properties and assets
substantially as an entirety to any other entity or permit any other entity to
consolidate, amalgamate, merge with or into, or replace it, if the transaction
would cause the trust or the successor entity to be classified other than as a
grantor trust for United States federal income tax purposes.
Voting Rights; Amendment of Trust Agreement
Unless otherwise specified in an applicable prospectus supplement, the
holders of preferred securities will have no voting rights except as discussed
below and under "--Consolidation, Merger or Amalgamation of the Trusts" and
"Description of the Preferred Securities Guarantees--Amendments and
Assignment," and as otherwise required by law and the Trust Agreement for the
trust.
If any proposed amendment to the Trust Agreement of a trust provides for, or
the regular trustees of the trust otherwise propose to effect:
(a) any action that would adversely affect the powers, preferences or
special rights of the trust's preferred securities in any material respect,
whether by way of amendment to the Trust Agreement or otherwise; or
(b) the dissolution, winding-up or termination of the trust other than
pursuant to the terms of its Trust Agreement,
then the holders of the trust's preferred securities as a class will be
entitled to vote on the amendment or proposal. In that case, the amendment or
proposal will be effective only if approved by the holders of at least a
majority in aggregate liquidation amount of the preferred securities.
The Trust Agreement of a trust may be amended from time to time by Edison
International and the property trustee and the regular trustees of the trust,
without the consent of the holders of preferred securities of the trust, to:
(a) cure any ambiguity, correct or supplement any provision which may be
inconsistent with any other provision, or make provisions not inconsistent
with any other provisions with respect to matters or questions arising
under the Trust Agreement, in each case to the extent that the amendment
does not adversely affect the interests of any holder of preferred
securities of the trust in any material respect; or
(b) modify, eliminate or add to any provisions to the extent necessary
to ensure that the trust will not be classified as other than a grantor
trust for United States federal income tax purposes or to ensure that the
trust will not be required to register as an "investment company" under the
Investment Company Act.
Except a provided in the next paragraph, other amendments to the Trust
Agreement of a trust may be made by Edison International and the trustees of
the trust upon:
(a) approval of the holders of a majority in aggregate liquidation
amount of the outstanding preferred securities of the trust; and
(b) receipt by the trustees of an opinion of counsel to the effect that
such amendment will not affect the trust's status as a grantor trust for
United States federal income tax purposes or the trust's exemption from the
Investment Company Act.
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Notwithstanding the foregoing, without the consent of each affected holder
of common or preferred securities of a trust, the Trust Agreement of the trust
may not be amended to:
(a) change the amount or timing of any distribution on the common or
preferred securities of the trust or otherwise adversely affect the amount
of any distribution required to be made in respect of such securities as of
a specified date; or
(b) restrict the right of a holder of any such securities to institute
suit for the enforcement of any such payment on or after such date.
In addition, no amendment may be made to a Trust Agreement if the amendment
would:
(a) cause the related trust to be characterized as other than a grantor
trust for United States federal income tax purposes;
(b) cause the related trust to be deemed to be an "investment company"
which is required to be registered under the Investment Company Act; or
(c) impose any additional obligation on Edison International, the
property trustee or the Delaware trustee without its consent.
Without obtaining the prior approval of the holders of a majority in
aggregate liquidation amount of the preferred securities of a trust, the
trustees of the trust may not:
(a) direct the time, method and place of conducting any proceeding for
any remedy available to the indenture trustee for the subordinated debt
securities held by the trust or executing any trust or power conferred on
the property trustee with respect to such securities;
(b) waive any default that is waivable under the subordinated indenture;
(c) cancel an acceleration of the principal of the subordinated debt
securities; or
(d) consent to any amendment, modification or termination of the
subordinated indenture or the subordinated debt securities where such
consent is required.
However, if a consent under the subordinated indenture requires the consent of
each affected holder of subordinated debt securities, then the property trustee
must obtain the prior consent of each holder of preferred securities. In
addition, before taking any of the foregoing actions, the property trustee must
obtain an opinion of counsel stating that the action will not cause the trust
to be classified as other than a grantor trust for United States federal income
tax purposes.
The property trustee of a trust will notify all preferred securities holders
of the trust of any notice of default received from the indenture trustee with
respect to the subordinated debt securities held by the trust.
Removal and Replacement of Trustees
The holder of a trust's common securities may remove or replace any of the
regular trustees and, unless an event of default has occurred and is continuing
under the subordinated indenture, the property and Delaware trustees of the
trust. If such an event of default has occurred and is continuing, only the
holders of a trust's preferred securities may remove or replace the property
and Delaware trustees. The resignation or removal of any trustee will be
effective only on the acceptance of appointment by the successor trustee in
accordance with the provisions of the Trust Agreement for the trust.
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Information Concerning the Property Trustees
For matters relating to compliance with the Trust Indenture Act, the
property trustee of each trust will have all of the duties and
responsibilities of an indenture trustee under the Trust Indenture Act. Each
property trustee, other than during the occurrence and continuance of a
default under the applicable Trust Agreement, undertakes to perform only the
duties as are specifically set forth in the applicable Trust Agreement and,
after a default, must use the same degree of care and skill as a prudent
person would exercise or use in the conduct of his or her own affairs. Subject
to this provision, a property trustee is under no obligation to exercise any
of the powers given it by the applicable Trust Agreement at the request of any
holder of preferred securities unless it is offered reasonable security or
indemnity against the costs, expenses and liabilities that it might incur. If
the property trustee is required to decide between alternative courses of
action, construe ambiguous provisions in the applicable Trust Agreement or is
unsure of the application of any provision of the applicable Trust Agreement,
and the matter is not one on which the holders of preferred securities are
entitled to vote, then the property trustee will take such action as it deems
advisable and in the best interests of the holders of the preferred and common
securities. In this event, the property trustee will have no liability except
for its own bad faith, negligence or willful misconduct.
The property trustee for each of the trusts is the same entity and will
also serve as the indenture trustee under each of the indentures and the
guarantee trustee under each of the guarantee agreements. Edison International
and certain of its subsidiaries maintain deposit accounts and banking
relationships with the property trustee.
Miscellaneous
The trustees of each trust are authorized and directed to conduct the
affairs of and to operate the trust in such a way that:
(a) it will not be deemed to be an "investment company" required to be
registered under the Investment Company Act;
(b) it will be classified as a grantor trust for United States federal
income tax purposes; and
(c) the subordinated debt securities held by it will be treated as
indebtedness of Edison International for United States federal income tax
purposes.
Edison International and the trustees of each trust are authorized to take
any action (so long as it is consistent with applicable law or the applicable
certificate of trust or Trust Agreement) that Edison International and the
trustees of the trust determine to be necessary or desirable for such
purposes.
Registered holders of preferred securities have no preemptive or similar
rights.
A trust may not borrow money, issue debt, execute mortgages or pledge any
of its assets.
Governing Law
Each Trust Agreement and the related preferred securities will be governed
by and construed in accordance with the laws of the State of Delaware.
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DESCRIPTION OF PREFERRED SECURITIES GUARANTEES
General
Edison International will execute a guarantee agreement (a "preferred
securities guarantee"), for the benefit of the holders of preferred securities,
at the time that a trust issues those preferred securities. Each preferred
securities guarantee will be qualified as an indenture under the Trust
Indenture Act. The Chase Manhattan Bank will act as indenture trustee
("guarantee trustee") under each preferred securities guarantee for the
purposes of compliance with the Trust Indenture Act.
The guarantee trustee will hold each preferred securities guarantee for the
benefit of the preferred securities holders of the applicable trust.
Edison International will irrevocably agree, as described in each preferred
securities guarantee, to pay in full, to the holders of the preferred
securities issued by the applicable trust, the preferred securities guarantee
payments (as defined below) (except to the extent previously paid), when and as
due, regardless of any defense, right of set-off or counterclaim which the
trust may have or assert. The following payments, to the extent not paid by a
trust ("preferred securities guarantee payments"), will be covered by the
applicable preferred securities guarantee:
(a) any accumulated and unpaid distributions required to be paid on the
applicable preferred securities, to the extent that the trust has funds
available to make the payment;
(b) the redemption price, to the extent that the trust has funds
available to make the payment; and
(c) upon a voluntary or involuntary dissolution, termination, winding-up
or liquidation of the trust (other than in connection with a distribution
of subordinated debt securities to holders of the preferred securities),
the lesser of:
(1) the aggregate of the liquidation amounts specified in the
prospectus supplement for each preferred security plus all accumulated
and unpaid distributions on the preferred security to the date of
payment, to the extent the trust has funds available to make the
payment; and
(2) the amount of assets of the trust remaining available for
distribution to holders of its preferred securities upon liquidation of
the trust.
Edison International's obligation to make a preferred securities guarantee
payment may be satisfied by directly paying the required amounts to the holders
of the preferred securities or by causing the trust to pay the amounts to the
holders.
Status of the Preferred Securities Guarantees
Each preferred securities guarantee will constitute an unsecured obligation
of Edison International and will rank:
(a) subordinate and junior in right of payment to all of Edison
International's other liabilities except those that rank equally or are
subordinate by their terms; and
(b) equal with any other preferred securities guarantee now or hereafter
issued by Edison International on behalf of the holders of preferred
securities issued by any other trust.
Each preferred securities guarantee will constitute a guarantee of payment
and not of collection (in other words, the holder of the guaranteed security
may sue Edison International, or seek other remedies, to enforce its rights
under the preferred securities guarantee without first suing any other person
or entity). A preferred securities guarantee will not be discharged except by
payment of the preferred securities guarantee payments in full to the extent
not otherwise paid or upon distribution to the applicable preferred securities
holders of the related subordinated debt securities pursuant to the applicable
Trust Agreement.
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Amendments and Assignment
Except with respect to any changes which do not adversely affect the rights
of holders of preferred securities in any material respect (in which case no
consent of the holders will be required), a preferred securities guarantee may
be amended only with the prior approval of the holders of at least a majority
in aggregate liquidation amount of the preferred securities. A description of
the way to obtain any approval appears under "Description of the Preferred
Securities--Voting Rights; Amendment of Trust Agreements." All guarantees and
agreements contained in a preferred securities guarantee will be binding on
Edison International's successors, assigns, receivers, trustees and
representatives and are for the benefit of the holders of the applicable
preferred securities.
Events of Default
An event of default under a preferred securities guarantee occurs if Edison
International fails to make any of its required payments or fails to perform
any of its other obligations (and such failure continues for 30 days) under the
preferred securities guarantee.
The holders of at least a majority in aggregate liquidation amount of the
preferred securities relating to each preferred securities guarantee will have
the right to direct the time, method and place of conducting any proceeding for
any remedy available to the guarantee trustee relating to the preferred
securities guarantee or to direct the exercise of any trust or power given to
the guarantee trustee under the preferred securities guarantee.
Information Concerning Guarantee Trustees
The guarantee trustee under a preferred securities guarantee, other than
during the occurrence and continuance of a default under the preferred
securities guarantee, will perform only the duties that are specifically
described in the preferred securities guarantee. After such a default, the
guarantee trustee will exercise the same degree of care and skill as a prudent
person would exercise or use in the conduct of his or her own affairs. Subject
to this provision, a guarantee trustee is under no obligation to exercise any
of its powers as described in the applicable preferred securities guarantee at
the request of any holder of covered preferred securities unless it is offered
security and indemnity satisfactory to it against the costs, expenses and
liabilities that it might incur.
Termination of the Preferred Securities Guarantees
Each preferred securities guarantee will terminate once the applicable
preferred securities are paid in full or upon distribution of the related
subordinated debt securities to the holders of the preferred securities in
accordance with the applicable Trust Agreement. Each preferred securities
guarantee will continue to be effective or will be reinstated if at any time
any holder of preferred securities issued by the applicable trust must restore
payment of any sums paid under the preferred securities or the preferred
securities guarantee.
Governing Law
The preferred securities guarantees will be governed by and construed in
accordance with the laws of the State of California, except that the rights,
duties, immunities and indemnities of the guarantee trustee shall be governed
by the laws of the State of New York.
28
<PAGE>
DESCRIPTION OF EXPENSE AGREEMENTS
Edison International will execute an expense agreement at the same time that
a trust issues preferred securities. Under the expense agreement, Edison
International will irrevocably and unconditionally guarantee to each creditor
of the trust, the full amount of the trust's costs, expenses and liabilities,
other than the amounts owed to holders of its preferred and common securities
pursuant to the terms of those securities. Third parties will be entitled to
enforce the expense agreement.
Edison International's obligations under the expense agreement will be
subordinated in right of payment to the same extent as the preferred securities
guarantee. The expense agreement will contain provisions regarding amendment,
termination, assignment, succession and governing law similar to those
contained in the preferred securities guarantee.
RELATIONSHIP AMONG PREFERRED SECURITIES, PREFERRED SECURITIES
GUARANTEES AND SUBORDINATED DEBT SECURITIES HELD BY EACH TRUST
Payments of distributions and redemption and liquidation payments due on
each series of preferred securities (to the extent the applicable trust has
funds available for the payments) will be guaranteed by Edison International to
the extent described under "Description of the Preferred Securities
Guarantees." No single document executed by Edison International in connection
with the issuance of any series of preferred securities will provide for its
full, irrevocable and unconditional guarantee of the preferred securities. It
is only the combined operation of Edison International's obligations under the
applicable preferred securities guarantee, Trust Agreement, subordinated
indenture and subordinated debt securities and expense agreement that has the
effect of providing a full, irrevocable and unconditional guarantee of a
trust's obligations under its preferred securities.
As long as Edison International makes payments of interest and other
payments when due on the subordinated debt securities held by a trust, the
payments will be sufficient to cover the payment of distributions and
redemption and liquidation payments due on the preferred securities issued by
that trust, primarily because:
(a) the aggregate principal amount of the subordinated debt securities
will be equal to the sum of the aggregate liquidation amounts of the
preferred and common securities;
(b) the interest rate and interest and other payment dates on the
subordinated debt securities will match the distribution rate and
distribution and other payment dates for the preferred securities;
(c) Edison International has agreed to pay for any and all costs,
expenses and liabilities of each trust except the trust's obligations under
its preferred securities; and
(d) each Trust Agreement provides that the related trust will not engage
in any activity that is not consistent with the limited purposes of the
trust.
If and to the extent that Edison International does not make payments on the
subordinated debt securities, the trust will not have funds available to make
payments of distributions or other amounts due on its preferred securities. In
those circumstances, a holder of preferred securities of the trust will not be
able to rely upon the preferred securities guarantee for payment of these
amounts. Instead, the holder may directly sue Edison International or seek
other remedies to collect its pro rata share of payments owed. If a holder sues
Edison International to collect payment, then Edison International will assume
the holder's rights as a holder of preferred securities under the trust's Trust
Agreement to the extent Edison International makes a payment to the holder in
any legal action.
29
<PAGE>
A holder of any preferred security may sue Edison International, or seek
other remedies, to enforce its rights under the applicable preferred securities
guarantee without first suing the applicable guarantee trustee, the trust which
issued the preferred security or any other person or entity.
EXPERTS
The consolidated financial statements and schedule incorporated by reference
in this prospectus and the registration statement of which this prospectus is a
part have been audited by Arthur Andersen LLP, independent public accountants,
as indicated in their reports with respect thereto, and are incorporated by
reference herein in reliance upon the authority of said firm as experts in
accounting and auditing in giving said reports.
VALIDITY OF THE SECURITIES AND THE PREFERRED SECURITIES GUARANTEES
Kenneth S. Stewart, Assistant General Counsel of Edison International, will
pass upon the validity of the debt securities, the common and preferred stock
and the preferred securities guarantees for Edison International. Richards,
Layton & Finger, P.A. will pass upon certain matters of Delaware law relating
to the validity of the preferred securities for Edison International and the
trusts.
PLAN OF DISTRIBUTION
We may sell the securities described in this prospectus from time to time in
one or more transactions
(a) to purchasers directly;
(b) to underwriters for public offering and sale by them;
(c) through agents;
(d) through dealers; or
(e) through a combination of any of the foregoing methods of sale.
We may distribute the securities from time to time in one or more
transactions at:
(a) a fixed price or prices, which may be changed;
(b) market prices prevailing at the time of sale;
(c) prices related to such prevailing market prices; or
(d) negotiated prices.
Direct Sales
We may sell the securities directly to institutional investors or others who
may be deemed to be underwriters within the meaning of the Securities Act of
1933, as amended, with respect to any resale of the securities. A prospectus
supplement will describe the terms of any sale of securities we are offering
hereunder.
To Underwriters
The applicable prospectus supplement will name any underwriter involved in a
sale of securities. Underwriters may offer and sell securities at a fixed price
or prices, which may be changed, or from time to time at market prices or at
negotiated prices. Underwriters may be deemed to have received
30
<PAGE>
compensation from us from sales of securities in the form of underwriting
discounts or commissions and may also receive commissions from purchasers of
securities for whom they may act as agent. Underwriters may be involved in any
at the market offering of equity securities by or on our behalf.
Underwriters may sell securities to or through dealers, and such dealers may
receive compensation in the form of discounts, concessions or commissions from
the underwriters and/or commissions (which may be changed from time to time)
from the purchasers for whom they may act as agent.
Unless otherwise provided in a prospectus supplement, the obligations of any
underwriters to purchase securities will be subject to certain conditions
precedent, and the underwriters will be obligated to purchase all the
securities if any are purchased.
Through Agents and Dealers
We will name any agent involved in a sale of securities, as well as any
commissions payable by us to such agent, in a prospectus supplement. Unless we
indicate differently in the prospectus supplement, any such agent will be
acting on a reasonable efforts basis for the period of its appointment.
If we utilize a dealer in the sale of the securities being offered pursuant
to their prospectus, we will sell the securities to the dealer, as principal.
The dealer may then resell the securities to the public at varying prices to be
determined by the dealer at the time of resale.
Delayed Delivery Contracts
If we so specify in the applicable prospectus supplement, we will authorize
underwriters, dealers and agents to solicit offers by certain institutions to
purchase the securities pursuant to contracts providing for payment and
delivery on future dates. Such contracts will be subject to only those
conditions set forth in the applicable prospectus supplement.
The underwriters, dealers and agents will not be responsible for the
validity or performance of the contracts. We will set forth in the prospectus
supplement relating to the contracts the price to be paid for the securities,
the commissions payable for solicitation of the contracts and the date in the
future for delivery of the securities.
General Information
Underwriters, dealers and agents participating in a sale of the securities
may be deemed to be underwriters as defined in the Securities Act, and any
discounts and commissions received by them and any profit realized by them on
resale of the securities may be deemed to be underwriting discounts and
commissions, under the Securities Act. We may have agreements with
underwriters, dealers and agents to indemnify them against certain civil
liabilities, including liabilities under the Securities Act, and to reimburse
them for certain expenses.
Underwriters or agents and their associates may be customers of, engage in
transactions with or perform services for us or our affiliates in the ordinary
course of business.
Unless we indicate differently in a prospectus supplement, we will not list
the securities on any securities exchange. The securities will be a new issue
of securities with no established trading market. Any underwriters that
purchase securities for public offering and sale may make a market in such
securities, but such underwriters will not be obligated to do so and may
discontinue any market making at any time without notice. We make no assurance
as to the liquidity of or the trading markets for any securities.
31
<PAGE>
- -------------------------------------------------------------------------------
- -------------------------------------------------------------------------------
No dealer, salesperson or other person is authorized to give any
information or to represent anything not contained in this prospectus. You
must not relay on any unauthorized information or representations. This
prospectus is an offer to sell only the QUIPS offered hereby, but only under
circumstances and in jurisdictions where it is lawful to do so. The
information contained in this prospectus is current only as of its date.
------------
TABLE OF CONTENTS
Prospectus Supplement
<TABLE>
<CAPTION>
Page
----
<S> <C>
Summary Information--Q&A.................................................. S-2
Risk Factors.............................................................. S-6
Accounting Treatment...................................................... S-9
Use of Proceeds........................................................... S-9
Description of the Series A QUIPS......................................... S-10
Description of the Series A QUIDS......................................... S-17
Book-Entry Issuance....................................................... S-24
Material United States Federal Income Tax Considerations.................. S-28
Underwriting.............................................................. S-34
Validity of Series A QUIPS, Series A QUIDS and Series A QUIPS Guarantee... S-36
Prospectus
About This Prospectus..................................................... 3
Forward-Looking Statements................................................ 3
Where You Can Find More Information....................................... 4
Edison International...................................................... 5
The Trusts................................................................ 6
Use of Proceeds........................................................... 7
Ratio of Edison International Earnings to Fixed Charges and Preferred
Stock Dividends.......................................................... 7
Description of Securities................................................. 8
Description of Debt Securities............................................ 8
Description of Edison International's Common Stock and Preferred Stock.... 17
Description of Preferred Securities....................................... 20
Description of Preferred Securities Guarantees............................ 27
Description of the Expense Agreements..................................... 29
Relationship Among Preferred Securities, Preferred Securities Guarantees
and Subordinated Debt Securities Held By Each Trust...................... 29
Experts................................................................... 30
Validity of the Securities and the Preferred Securities Guarantees........ 30
Plan of Distribution...................................................... 30
</TABLE>
- -------------------------------------------------------------------------------
- -------------------------------------------------------------------------------
- -------------------------------------------------------------------------------
- -------------------------------------------------------------------------------
20,000,000 Preferred Securities
EIX Trust I
% Cumulative Quarterly
Income Preferred Securities, Series A
(QUIPSSM)
(Liquidation Amount $25 per QUIPS)
Fully and unconditionally guaranteed, as described herein, by
Edison International
------------
PROSPECTUS SUPPLEMENT
------------
Goldman, Sachs & Co.
A.G. Edwards & Sons, Inc.
Lehman Brothers
Merrill Lynch & Co.
Morgan Stanley Dean Witter
PaineWebber Incorporated
Prudential Securities Incorporated
Salomon Smith Barney
Representatives of the Underwriters
- -------------------------------------------------------------------------------
- -------------------------------------------------------------------------------
<PAGE>
PART II.
INFORMATION NOT REQUIRED IN PROSPECTUS
Item 14. Other Expenses of Issuance and Distribution.
<TABLE>
<S> <C>
Securities and Exchange Commission registration fee........... $ 695,000.00
Printing expenses............................................. $ 5,000.00
Trustee fees and expenses..................................... $ 14,000.00
Legal fees and expenses....................................... $ 150,000.00
Accounting fees and expenses.................................. $ 50,000.00
Blue Sky fees and expenses.................................... $ 20,000.00
Rating Agency fees............................................ $ 205,000.00
Miscellaneous................................................. $ 10,000.00
-------------
Total....................................................... $1,149,000.00
=============
</TABLE>
Item 15. Indemnification of Officers and Directors.
Section 317 of the California Corporations Code provides that a corporation
shall have the power to indemnify any person who was or is a party or is
threatened to be made a party to any proceeding or action by reason of the fact
that he or she is or was a director, officer, employee or other agent of such
corporation or is or was serving at the request of the corporation as a
director, officer, employee or agent of another corporation or other
enterprise. Section 317 also grants authority to a corporation to include in
its articles of incorporation indemnification provisions in excess of that
permitted in Section 317, subject to certain limitations.
Article Sixth of the Restated Articles of Incorporation of Edison
International authorizes Edison International to provide indemnification of
directors, officers, employees, and other agents through bylaw provisions,
agreements with agents, votes of shareholders or disinterested directors, or
otherwise, in excess of the indemnification otherwise permitted by Section 317
of the California Corporations Code, subject only to the applicable limits set
forth in Section 204 of the California Corporations Code.
Article VI of the Amended Bylaws of Edison International contains provisions
implementing the authority granted in Article Sixth of the Articles of
Incorporation. The Bylaws provide for the indemnification of any director or
officer of Edison International, or any person acting at the request of Edison
International as a director, officer, employee or agent of another corporation
or other enterprise, for any threatened, pending or completed action, suit or
proceeding to the fullest extent permissible under California law and the
Restated Articles of Incorporation of Edison International, subject to the
terms of any agreement between Edison International and such a person; provided
that, no such person shall be indemnified: (i) except to the extent that the
aggregate of losses to be indemnified exceeds the amount of such losses for
which the director or officer is paid pursuant to any director's or officer's
liability insurance policy maintained by Edison International; (ii) on account
of any suit in which judgment is rendered for an accounting of profits made
from the purchase or sale of securities of Edison International pursuant to
Section 16(b) of the Securities Exchange Act of 1934 and amendments thereto or
similar provisions of any federal, state or local statutory law; (iii) if a
court of competent jurisdiction finally determines that the indemnification is
unlawful; (iv) for acts or omissions involving intentional misconduct or
knowing and culpable violation of law; (v) for acts or omissions that the
director or officer believes to be contrary to the best interests of Edison
International or its shareholders, or that involve the absence of good faith;
(vi) for any transaction from which the director or officer derived an improper
personal benefit; (vii) for acts or omissions that show a reckless disregard
for the director's or officer's duty to Edison International or its
shareholders in circumstances in which the director or officer was aware, or
should have been
II-1
<PAGE>
aware, in the ordinary course of performing his or her duties, of a risk of
serious injury to Edison International or its shareholders; (viii) for acts or
omissions that constitute an unexcused pattern of inattention that amount to an
abdication of the director's or officer's duties to Edison International or its
shareholders; (ix) for costs, charges, expenses, liabilities and losses arising
under Section 310 or 316 of the California Corporation Code; or (x) as to
circumstances in which indemnity is expressly prohibited by Section 317 of the
California Corporation Code. The exclusions set forth in clauses (iv) through
(ix) above shall apply only to indemnification with regard to any action
brought by or in the right of Edison International for breach of duty to Edison
International or its shareholders. The Amended Bylaws of Edison International
also provide that Edison International shall indemnify any director or officer
in connection with (a) a proceeding (or part thereof) initiated by him or her
only if such proceeding (or part thereof) was authorized by the Board of
Directors or (b) a proceeding (or part thereof), other than a proceeding by or
in the name of Edison International to procure a judgment in its favor, only if
any settlement of such a proceeding is approved in writing by Edison
International. Indemnification shall cover all costs, charges, expenses,
liabilities and losses, including attorneys' fees, judgments, fines, ERISA
excise taxes, or penalties and amounts paid or to be paid in settlement,
reasonably incurred or suffered by the director or officer.
Edison International has directors' and officers' liability insurance
policies in force insuring directors and officers of Edison International and
its subsidiaries. Edison International has also entered into written agreements
with each of its directors incorporating the indemnification provisions of the
Bylaws.
Item 16. Exhibits.
<TABLE>
<C> <S>
1.1 Underwriting Agreement (Preferred Securities).
*1.2 Underwriting Agreement (Senior Debt Securities).
*1.3 Underwriting Agreement (Subordinated Debt Securities).
*1.4 Underwriting Agreement (Common Stock).
*1.5 Underwriting Agreement (Preferred Stock).
+3.1 Restated Articles of Incorporation of Edison International dated May
7, 1998 (Incorporated by reference from the Annual Report on Form 10-K
for the year ended December 31, 1998, File No. 1-9936 (Exhibit 3.1)).
+3.2 Certificate of Determination of Series A Junior Participating
Cumulative Preferred Stock of Edison International dated November 21,
1996 (Incorporated by reference from the Registration Statement on
Form 8-A filed November 21, 1996 (Exhibit 4.2)).
+3.3 Amended Bylaws of Edison International as adopted by the Board of
Directors on April 15, 1999 (Incorporated by reference from the
Quarterly Report on Form 10-Q for the quarterly period ended March 31,
1999, File No. 1-9936 (Exhibit 3.3)).
+3.4 Certificate of Trust of EIX Trust I.
+3.5 Certificate of Trust of EIX Trust II.
+3.6 Certificate of Trust of EIX Trust III.
+4.1 Form of Indenture for Senior Debt Securities.
+4.2 Form of Indenture for Subordinated Debt Securities.
*4.3 Form of Supplemental Indenture.
+4.4 Form of Senior Note (included in Exhibit 4.1).
+4.5 Form of Subordinated Note (included in Exhibit 4.2).
+4.6 Form of Preferred Security (included in Exhibit 4.11).
+4.7 Form of Preferred Securities Guarantee.
</TABLE>
II-2
<PAGE>
<TABLE>
<C> <S>
+4.8 Trust Agreement of EIX Trust I.
+4.9 Trust Agreement of EIX Trust II.
+4.10 Trust Agreement of EIX Trust III.
+4.11 Form of Amended and Restated Trust Agreement for each of EIX Trust I,
EIX Trust II and EIX Trust III.
+4.12 Form of Expense Agreement for each of EIX Trust I, EIX Trust II and
EIX Trust III (included in Exhibit 4.11).
+4.13 Rights Agreement dated November 21, 1996 between Edison International
and Harris Trust Company of California, as rights agent (Incorporated
by reference from the Registration Statement on Form 8-A filed
November 21, 1996 (Exhibit 4.1)).
+5.1 Opinion of Kenneth S. Stewart, Assistant General Counsel of Edison
International.
+5.2 Opinion of Richards, Layton & Finger, P.A. relating to EIX Trust I.
+5.3 Opinion of Richards, Layton & Finger, P.A. relating to EIX Trust II.
+5.4 Opinion of Richards, Layton & Finger, P.A. relating to EIX Trust III.
+8.1 Opinion of Latham & Watkins relating to tax matters.
+12.1 Statement regarding the computation of ratio of earnings to combined
fixed charges and preferred stock dividends for the years ended
December 31, 1998, 1997, 1996, 1995 and 1994.
+23.1 Consent of Kenneth S. Stewart, Assistant General Counsel of Edison
International (included in Exhibit 5.1).
+23.2 Consents of Richards, Layton & Finger, P.A. (included in Exhibits
5.2, 5.3 and 5.4).
+23.3 Consent of Independent Public Accountants (Arthur Andersen LLP).
+24.1 Power of Attorney (as to Edison International).
+24.2 Certified Resolution of Edison International.
+25.1 Statement of Eligibility on Form T-1 under the Trust Indenture Act of
1939, as amended, of Harris Trust and Savings Bank, as Trustee under
the Indenture (Senior Debt Securities).
+25.2 Statement of Eligibility on Form T-1 under the Trust Indenture Act of
1939, as amended, of The Chase Manhattan Bank, as Trustee under the
Indenture (Subordinated Debt Securities).
+25.3 Statement of Eligibility on Form T-1 under the Trust Indenture Act of
1939, as amended, of The Chase Manhattan Bank, as Property Trustee--
EIX Trust I.
+25.4 Statement of Eligibility on Form T-1 under the Trust Indenture Act of
1939, as amended, of The Chase Manhattan Bank, as Property Trustee--
EIX Trust II.
+25.5 Statement of Eligibility on Form T-1 under the Trust Indenture Act of
1939, as amended, of The Chase Manhattan Bank, as Property Trustee--
EIX Trust III.
+25.6 Statement of Eligibility on Form T-1 under the Trust Indenture Act of
1939, as amended, of The Chase Manhattan Bank, as Guarantee Trustee--
EIX Trust I.
+25.7 Statement of Eligibility on Form T-1 under the Trust Indenture Act of
1939, as amended, of The Chase Manhattan Bank, as Guarantee Trustee--
EIX Trust II.
+25.8 Statement of Eligibility on Form T-1 under the Trust Indenture Act of
1939, as amended, of The Chase Manhattan Bank, as Guarantee Trustee--
EIX Trust III.
</TABLE>
- --------
*To be filed by amendment or incorporated by reference pursuant to subsequent
filings by Edison International.
+Previously filed.
II-3
<PAGE>
Item 17. Undertakings.
The undersigned registrants hereby undertake:
(1) To file, during any period in which offers or sales are being made,
a post-effective amendment to this Registration Statement:
(i) to include any prospectus required by Section 10(a)(3) of the
Securities Act;
(ii) to reflect in the prospectus any facts or events arising after
the effective date of the Registration Statement (or the most recent
post-effective amendment thereof) which, individually or in the
aggregate, represent a fundamental change in the information set forth
in the Registration Statement. Notwithstanding the foregoing, any
increase or decrease in volume of securities offered (if the total
dollar value of securities offered would not exceed that which was
registered) and any deviation from the low or high end of the estimated
maximum offering range may be reflected in the form of prospectus filed
with the Securities and Exchange Commission pursuant to Rule 424(b) if,
in the aggregate, the changes in volume and price represent no more
than a 20% change in the maximum aggregate offering price set forth in
the "Calculation of Registration Fee" table in the effective
Registration Statement; and
(iii) to include any material information with respect to the plan
of distribution not previously disclosed in the Registration Statement
or any material change to such information in the Registration
Statement;
provided, however, that (i) and (ii) do not apply if the information
required to be included in a post-effective amendment by those paragraphs
is contained in periodic reports filed with or furnished to the Securities
and Exchange Commission by the registrants pursuant to Section 13 or
Section 15(d) of the Exchange Act that are incorporated by reference in the
Registration Statement.
(2) That, for the purpose of determining any liability under the
Securities Act, each such post-effective amendment shall be deemed to be a
new registration statement relating to the securities offered therein, and
the offering of such securities at that time shall be deemed to be the
initial bona fide offering thereof.
(3) To remove from registration by means of post-effective amendment any
of the securities being registered which remain unsold at the termination
of the offering.
(4) That, for purposes of determining any liability under the Securities
Act, each filing of Edison International's annual report pursuant to
Section 13(a) or Section 15(d) of the Exchange Act that is incorporated by
reference in this Registration Statement shall be deemed to be a new
registration statement relating to the securities offered herein, and the
offering of such securities at that time shall be deemed to be the initial
bona fide offering thereof.
(5) To file an application for the purpose of determining the
eligibility of the trustees to act under subsection (a) of Section 310 of
the Trust Indenture Act in accordance with the rules and regulations
prescribed by the Securities and Exchange Commission under Section
305(b)(2) of the Securities Act.
Insofar as indemnification for liabilities arising under the Securities Act
may be permitted to directors, officers and controlling persons of the
registrants pursuant to the provisions described under Item 15 above, or
otherwise, the registrants have been advised that in the opinion of the
Securities and Exchange Commission such indemnification is against public
policy as expressed in the Securities Act and is, therefore, unenforceable. In
the event that a claim for indemnification against such liabilities (other than
the payment by a registrant of expenses incurred or paid by a director, officer
or controlling person in the successful defense of any action, suit or
proceeding) is asserted by such director, officer or controlling person in
connection with the securities being registered, such registrant will, unless
in the opinion of its counsel the matter has been settled by controlling
precedent, submit to a court of appropriate jurisdiction the question whether
such indemnification by it is against public policy as expressed in the
Securities Act and will be governed by the final adjudication of such issue.
II-4
<PAGE>
SIGNATURES
Pursuant to the requirements of the Securities Act of 1933, as amended,
Edison International certifies that it has reasonable grounds to believe that
it meets all of the requirements for filing on Form S-3 and has duly caused
this Amendment No. 1 to Registration Statement to be signed on its behalf by
the undersigned, thereunto duly authorized, in the City of Rosemead, and State
of California, on the 13th day of July, 1999.
EDISON INTERNATIONAL
/s/ Mary C. Simpson
By __________________________________
Mary C. Simpson
Assistant Treasurer
Pursuant to the requirements of the Securities Act of 1933, as amended, this
Amendment No. 1 to Registration Statement has been signed below by the
following persons in the capacities indicated on the 13th day of July, 1999.
<TABLE>
<CAPTION>
Signature Title
--------- -----
<S> <C> <C>
* Principal Executive
______________________________________ Officer; Chairman of the
John E. Bryson Board, Chief Executive
Officer and Director
* Principal Financial
______________________________________ Officer; Executive Vice
Alan J. Fohrer President and Chief
Financial Officer
* Controller; Vice President
______________________________________ and Controller
Thomas M. Noonan
* Director
______________________________________
Winston H. Chen
* Director
______________________________________
Warren Christopher
* Director
______________________________________
Stephen E. Frank
* Director
______________________________________
Joan C. Hanley
* Director
______________________________________
Carl F. Huntsinger
</TABLE>
II-5
<PAGE>
<TABLE>
<CAPTION>
Signature Title
--------- -----
<S> <C>
* Director
______________________________________
Charles D. Miller
* Director
______________________________________
Luis G. Nogales
* Director
______________________________________
Ronald L. Olson
* Director
______________________________________
James M. Rosser
* Director
______________________________________
Robert H. Smith
* Director
______________________________________
Thomas C. Sutton
* Director
______________________________________
Daniel M. Tellep
* Director
______________________________________
Edward Zapanta
</TABLE>
*By: /s/ Mary C. Simpson
_________________________________
Mary C. Simpson
(as Attorney-in-Fact)
II-6
<PAGE>
SIGNATURES
Pursuant to the requirements of the Securities Act of 1933, as amended, the
registrant certifies that it has reasonable grounds to believe that it meets
all of the requirements for filing on Form S-3 and has duly caused this
Amendment No. 1 to Registration Statement to be signed on its behalf by the
undersigned, thereunto duly authorized, in the City of Rosemead, and State of
California, on the 13th day of July, 1999.
EIX TRUST I
By: EDISON INTERNATIONAL,
as Depositor
/s/ Mary C. Simpson
By: _________________________
Mary C. Simpson
Assistant Treasurer
II-7
<PAGE>
SIGNATURES
Pursuant to the requirements of the Securities Act of 1933, as amended, the
registrant certifies that it has reasonable grounds to believe that it meets
all of the requirements for filing on Form S-3 and has duly caused this
Amendment No. 1 to Registration Statement to be signed on its behalf by the
undersigned, thereunto duly authorized, in the City of Rosemead, and State of
California, on the 13th day of July, 1999.
EIX TRUST II
By: EDISON INTERNATIONAL,
as Depositor
/s/ Mary C. Simpson
By: _________________________
Mary C. Simpson
Assistant Treasurer
II-8
<PAGE>
SIGNATURES
Pursuant to the requirements of the Securities Act of 1933, as amended, the
registrant certifies that it has reasonable grounds to believe that it meets
all of the requirements for filing on Form S-3 and has duly caused this
Amendment No. 1 to Registration Statement to be signed on its behalf by the
undersigned, thereunto duly authorized, in the City of Rosemead, and State of
California, on the 13th day of July, 1999.
EIX TRUST III
By: EDISON INTERNATIONAL,
as Depositor
/s/ Mary C. Simpson
By: _________________________
Mary C. Simpson
Assistant Treasurer
II-9
<PAGE>
EDISON INTERNATIONAL
EIX TRUST I
EIX TRUST II
EIX TRUST III
REGISTRATION STATEMENT ON FORM S-3
EXHIBIT INDEX
<TABLE>
<CAPTION>
Exhibit
No. Description
------- -----------
<C> <S>
1.1 Underwriting Agreement (Preferred Securities).
*1.2 Underwriting Agreement (Senior Debt Securities).
*1.3 Underwriting Agreement (Subordinated Debt Securities).
*1.4 Underwriting Agreement (Common Stock).
*1.5 Underwriting Agreement (Preferred Stock).
+3.1 Restated Articles of Incorporation of Edison International dated May
7, 1998 (Incorporated by reference from Annual Report on Form 10-K for
the year ended December 31, 1998, File No. 1-9936 (Exhibit 3.1)).
+3.2 Certificate of Determination of Series A Junior participating
Cumulative Preferred Stock of Edison International dated November 21,
1996 (Incorporated by reference from the Registration Statement on
Form 8-A filed November 21, 1996 (Exhibit 4.2)).
+3.3 Amended Bylaws of Edison International as adopted by the Board of
Directors on April 15, 1999 (Incorporated by reference from the
Quarterly Report on Form 10-Q for the quarterly period ended March 31,
1999, File No. 1-9936 (Exhibit 3.3)).
+3.4 Certificate of Trust of EIX Trust I.
+3.5 Certificate of Trust of EIX Trust II.
+3.6 Certificate of Trust of EIX Trust III.
+4.1 Form of Indenture for Senior Debt Securities.
+4.2 Form of Indenture for Subordinated Debt Securities.
*4.3 Form of Supplemental Indenture.
+4.4 Form of Senior Note (included in Exhibit 4.1).
+4.5 Form of Subordinated Note (included in Exhibit 4.2).
+4.6 Form of Preferred Security (included in Exhibit 4.11).
+4.7 Form of Preferred Securities Guarantee.
+4.8 Trust Agreement of EIX Trust I.
+4.9 Trust Agreement of EIX Trust II.
+4.10 Trust Agreement of EIX Trust III.
+4.11 Form of Amended and Restated Trust Agreement for each of EIX Trust I,
EIX Trust II and EIX Trust III.
+4.12 Form of Expense Agreement for each of EIX Trust I, EIX Trust II and
EIX Trust III (included in Exhibit 4.11).
+4.13 Rights Agreement dated November 21, 1996 between Edison International
and Harris Trust Company of California, as rights agent (Incorporated
by reference from the Registration Statement on Form 8-A filed
November 21, 1996 (Exhibit 4.1)).
</TABLE>
1
<PAGE>
<TABLE>
<CAPTION>
Exhibit
No. Description
------- -----------
<C> <S>
+5.1 Opinion of Kenneth S. Stewart, Assistant General Counsel of Edison
International.
+5.2 Opinion of Richards, Layton & Finger, P.A. relating to EIX Trust I.
+5.3 Opinion of Richards, Layton & Finger, P.A. relating to EIX Trust II.
+5.4 Opinion of Richards, Layton & Finger, P.A. relating to EIX Trust III.
+8.1 Opinion of Latham & Watkins relating to tax matters.
+12.1 Statement regarding the computation of ratio of earnings to combined
fixed charges and preferred stock dividends for the years ended
December 31, 1998, 1997, 1996, 1995 and 1994.
+23.1 Consent of Kenneth S. Stewart, Assistant General Counsel of Edison
International (included in Exhibit 5.1).
+23.2 Consents of Richards, Layton & Finger, P.A. (included in Exhibits 5.2,
5.3 and 5.4).
+23.3 Consent of Independent Public Accountants (Arthur Andersen LLP).
+24.1 Power of Attorney (as to Edison International).
+24.2 Certified Resolution of Edison International.
+25.1 Statement of Eligibility on Form T-1 under the Trust Indenture Act of
1939, as amended, Harris Trust and Savings Bank, as Trustee under the
Indenture (Senior Debt Securities).
+25.2 Statement of Eligibility on Form T-1 under the Trust Indenture Act of
1939, as amended, The Chase Manhattan Bank, as Trustee under the
Indenture (Subordinated Debt Securities).
+25.3 Statement of Eligibility on Form T-1 under the Trust Indenture Act of
1939, as amended, of The Chase Manhattan Bank, as Property Trustee--
EIX Trust I.
+25.4 Statement of Eligibility on Form T-1 under the Trust Indenture Act of
1939, as amended, of The Chase Manhattan Bank, as Property Trustee--
EIX Trust II.
+25.5 Statement of Eligibility on Form T-1 under the Trust Indenture Act of
1939, as amended, of The Chase Manhattan Bank, as Property Trustee--
EIX Trust III.
+25.6 Statement of Eligibility on Form T-1 under the Trust Indenture Act of
1939, as amended, of The Chase Manhattan Bank, as Guarantee Trustee--
EIX Trust I.
+25.7 Statement of Eligibility on Form T-1 under the Trust Indenture Act of
1939, as amended, of The Chase Manhattan Bank, as Guarantee Trustee--
EIX Trust II.
+25.8 Statement of Eligibility on Form T-1 under the Trust Indenture Act of
1939, as amended, of The Chase Manhattan Bank, as Guarantee Trustee--
EIX Trust III.
</TABLE>
- --------
* To be filed by amendment or incorporated by reference pursuant to subsequent
filings by Edison International.
+ Previously filed.
2
<PAGE>
EXHIBIT 1.1
EIX Trust I
EIX Trust II
EIX Trust III
Preferred Securities
guaranteed to the extent set forth in the Guarantees by
Edison International
Underwriting Agreement
----------------------
July ___, 1999
To the Representatives of the several Underwriters
named in the respective Pricing Agreements
hereinafter described
Ladies and Gentlemen:
From time to time EIX Trust I, EIX Trust II or EIX Trust III, each a
statutory business trust formed under the laws of the State of Delaware (each a
"Trust" and collectively the "Trusts"), and Edison International, a California
corporation (the "Company"), as depositor of each Trust and as guarantor,
propose to enter into one or more Pricing Agreements (each a "Pricing
Agreement") in the form of Annex I hereto, with such additions and deletions as
the parties thereto may determine, and, subject to the terms and conditions
stated herein and therein, that the Trust identified in the applicable Pricing
Agreement (such Trust being the "Designated Trust" with respect to such Pricing
Agreement) issue and sell to the firms named in Schedule I to the applicable
Pricing Agreement (such firms constituting the "Underwriters" with respect to
such Pricing Agreement and the securities specified therein) certain of its
preferred securities (the "Securities") representing undivided beneficial
interests in the assets of the Designated Trust. The Securities specified in
such Pricing Agreement are referred to as the "Firm Designated Securities" with
respect to such Pricing Agreement. If specified in such Pricing Agreement, the
Designated Trust may grant the Underwriters the right to purchase at their
election an additional number of Securities, specified as provided in such
Pricing Agreement as provided in Section 3 hereof (the "Optional Designated
Securities"). The Firm Designated Securities and any Optional Designated
Securities are collectively called the "Designated Securities." The proceeds of
the sale of the Designated Securities to the public and of common securities of
the Designated Trust (the "Common Securities") to the Company concurrently with
the sale of the Designated Securities are to be invested in subordinated
deferrable interest debentures of the Company (the "Subordinated Debentures")
identified in the Pricing Agreement with respect to such Designated Securities
(with respect to such Pricing Agreement, the "Designated Subordinated
Debentures"), to be issued pursuant to a subordinated indenture to be
<PAGE>
dated as of July [___], 1999 (as supplemented or amended from time to time, the
"Subordinated Indenture") between the Company and The Chase Manhattan Bank, as
trustee (the "Indenture Trustee"). The Designated Securities will be guaranteed
by the Company to the extent set forth in a Guarantee Agreement between the
Company and The Chase Manhattan Bank, as trustee, with respect to such
Designated Securities (the "Designated Guarantee") (all such Designated
Guarantees together, the "Guarantees").
The terms and rights of any particular issuance of Designated Securities
shall be as specified in the Pricing Agreement relating thereto and in or
pursuant to the amended and restated trust agreement identified in such Pricing
Agreement (with respect to such Pricing Agreement, the "Trust Agreement").
1. Particular sales of Designated Securities may be made from time to
time to the Underwriters of such Securities, for whom the firms designated as
representatives of the Underwriters of such Securities in the Pricing Agreement
relating thereto will act as representatives (the "Representatives"). The term
"Representatives" also refers to a single firm acting as sole representative of
the Underwriters and to an Underwriter or Underwriters who act without any firm
being designated as its or their representatives. This Underwriting Agreement
shall not be construed as an obligation of any Trust to sell any of the
Securities or as an obligation of any of the Underwriters to purchase the
Securities. The obligation of any Trust to issue and sell any of the Securities
and the obligation of any of the Underwriters to purchase any of the Securities
shall be evidenced by the Pricing Agreement with respect to the Designated
Securities specified therein. Each Pricing Agreement shall specify the
aggregate liquidation amount of Firm Designated Securities, the maximum
aggregate liquidation amount of Optional Designated Securities, if any, the
initial public offering price of such Firm Designated Securities and Optional
Designated Securities or the manner of determining such price, the terms of the
Designated Securities, including the terms on which and terms of the securities
into which the Designated Securities will be exchangeable, the purchase price to
the Underwriters of such Designated Securities, the names of the Underwriters of
such Designated Securities, the names of the Representatives of such
Underwriters and the number of such Designated Securities to be purchased by
each Underwriter and the commission, if any, payable to the Underwriters with
respect thereto and shall set forth the date, time and manner of delivery of
such Firm Designated Securities and such Optional Designated Securities, if any,
and payment therefor. The Pricing Agreement shall also specify (to the extent
not set forth in the Trust Agreement and the registration statement and
prospectus with respect thereto) the terms of such Designated Securities. A
Pricing Agreement shall be in the form of an executed writing (which may be in
counterparts), and may be evidenced by an exchange of telegraphic communications
or any other rapid transmission device designed to produce a written record of
communications transmitted. The obligations of the Underwriters under this
Agreement and each Pricing Agreement shall be several and not joint.
2. Each of the Company and the Designated Trust, jointly and severally,
represents and warrants to, and agrees with, each of the Underwriters that:
2
<PAGE>
(a) A registration statement on Form S-3 (File No 333-82293) (the
"Initial Registration Statement") in respect of the Securities, the
Subordinated Debentures and the Guarantees has been filed with the
Securities and Exchange Commission (the "Commission"); the Initial
Registration Statement and any post-effective amendment thereto, each in
the form heretofore delivered or to be delivered to the Representatives,
have been declared effective by the Commission in such form; other than a
registration statement, if any, increasing the size of the offering (a
"Rule 462(b) Registration Statement"), filed pursuant to Rule 462(b) under
the Securities Act of 1933, as amended (the "Act"), which became effective
upon filing, no other document with respect to the Initial Registration
Statement or document incorporated by reference therein has heretofore been
filed or transmitted for filing with the Commission (other than documents
filed after the filing date of the Initial Registration Statement under the
Securities Exchange Act of 1934, as amended (the "Exchange Act"), and
prospectuses filed pursuant to Rule 424(b) of the rules and regulations of
the Commission under the Act, each in the form heretofore delivered to the
Representatives); and no stop order suspending the effectiveness of the
Initial Registration Statement, any post-effective amendment thereto or the
Rule 462(b) Registration Statement, if any, has been issued and no
proceeding for that purpose has been initiated or threatened by the
Commission (any preliminary prospectus included in the Initial Registration
Statement or filed with the Commission pursuant to Rule 424(a) under the
Act, is hereinafter called a "Preliminary Prospectus"; the various parts of
the Initial Registration Statement, any post-effective amendment thereto
and the Rule 462(b) Registration Statement, if any, including (i) the
information contained in the form of any final prospectus filed with the
Commission pursuant to Rule 424(b) under the Act and deemed by virtue of
Rule 430A under the Act to be part of the Initial Registration Statement at
the time it was declared effective or such part of the Rule 462(b)
Registration Statement, if any, became or hereafter becomes effective, (ii)
all exhibits thereto and (iii) the documents incorporated by reference in
the prospectus contained in the Initial Registration Statement at the time
such part of the Initial Registration Statement became effective but
excluding Form T-1, each as amended at the time such part of the Initial
Registration Statement became effective or such part of the Rule 462(b)
Registration Statement, if any, became or hereafter becomes effective, are
hereinafter collectively called the "Registration Statement"; the
prospectus relating to the Securities, the Subordinated Debentures and the
Guarantees, in the form in which it has most recently been filed, or
transmitted for filing, with the Commission on or prior to the date of this
Agreement, is hereinafter called the "Prospectus"; any reference herein to
any Preliminary Prospectus or the Prospectus shall be deemed to refer to
and include the documents incorporated by reference therein pursuant to the
applicable form under the Act, as of the date of such Preliminary
Prospectus or Prospectus, as the case may be; any reference to any
amendment or supplement to any Preliminary Prospectus or the Prospectus
shall be deemed to refer to and include any documents filed after the date
of such Preliminary Prospectus or Prospectus, as the case may be, under the
Exchange Act and incorporated by reference in such Preliminary Prospectus
or Prospectus, as the case may be, as of the date of filing of such
document; any reference to any amendment to the Initial Registration
Statement shall be deemed to refer to and include any annual report of
3
<PAGE>
either the Trusts or the Company filed pursuant to Sections 13(a) or 15(d)
of the Exchange Act after the effective date of the Initial Registration
Statement that is incorporated by reference in the Registration Statement;
and any reference to the Prospectus as amended or supplemented shall be
deemed to refer to the Prospectus as amended or supplemented in relation to
the applicable Designated Securities in the form in which it is filed with
the Commission pursuant to Rule 424(b) under the Act in accordance with
Section 5(a) hereof, including any documents incorporated by reference
therein as of the date of such filing);
(b) The documents incorporated by reference in the Prospectus, when
they became effective or were filed with the Commission, as the case may
be, conformed in all material respects to the requirements of the Act or
the Exchange Act, as applicable, and the rules and regulations of the
Commission thereunder; the Prospectus at the time it was filed did not
include an untrue statement of a material fact or omit to state a material
fact necessary in order to make the statements therein, in the light of the
circumstances under which they were made, not misleading; and any further
documents so filed and incorporated by reference in the Prospectus or any
further amendment or supplement thereto, when such documents become
effective or are filed with the Commission, as the case may be, will
conform in all material respects to the requirements of the Act or the
Exchange Act, as applicable, and the rules and regulations of the
Commission thereunder and will not include an untrue statement of a
material fact or omit to state a material fact necessary in order to make
the statements therein, in the light of the circumstances under which they
were made, not misleading; provided, however, that this representation and
warranty shall not apply to any statements or omissions made in reliance
upon and in conformity with information furnished in writing to the Company
by an Underwriter of Designated Securities through the Representatives
expressly for use in the Prospectus as amended or supplemented relating to
such Securities;
(c) The Registration Statement conforms, and any further amendments
or supplements to the Registration Statement will conform, in all material
respects to the requirements of the Act and the Trust Indenture Act of
1939, as amended (the "Trust Indenture Act"), and the rules and regulations
of the Commission thereunder and does not and will not, as of the
applicable effective date as to the Registration Statement and any
amendment thereto, contain an untrue statement of a material fact or omit
to state a material fact required to be stated therein or necessary to make
the statements therein not misleading; provided, however, that this
representation and warranty shall not apply to any statements or omissions
made in reliance upon and in conformity with information furnished in
writing to the Company by an Underwriter of Designated Securities through
the Representatives expressly for use in the Prospectus as amended or
supplemented relating to such Securities;
(d) Neither the Designated Trust nor the Company and any of its
subsidiaries (other than the Designated Trust) taken as a whole has
sustained since the date of the latest audited financial statements
included or incorporated by reference in the Prospectus
4
<PAGE>
any material loss or interference with its business from fire, explosion,
flood or other calamity, whether or not covered by insurance, or from any
labor dispute or court or governmental action, order or decree, otherwise
than as set forth or contemplated in the Prospectus; and, since the
respective dates as of which information is given in the Registration
Statement and the Prospectus, there has not been any change in the capital
stock or long-term debt of the Designated Trust, in either case in an
aggregate amount in excess of $__________, or of the Company and its
subsidiaries (other than the Designated Trust) taken as a whole, in either
case in an aggregate amount in excess of $__________, or any material
adverse change, or any development involving a prospective material adverse
change, in or affecting the general affairs, management, financial
position, stockholders' equity or results of operations of the Designated
Trust or the Company and its subsidiaries (other than the Designated Trust)
taken as a whole, otherwise than as set forth or contemplated in the
Prospectus;
(e) The Designated Trust has been duly created and is validly
existing as a business trust in good standing under the laws of the State
of Delaware, with power and authority to conduct its business as described
in the Prospectus;
(f) The Company has been duly incorporated and is validly existing as
a corporation in good standing under the laws of the jurisdiction of its
incorporation, with power and authority (corporate and other) to own its
properties and conduct its business as described in the Prospectus;
(g) The Company has an authorized capitalization as set forth in the
Prospectus, and all of the issued shares of capital stock of the Company
have been duly and validly authorized and issued and are fully paid and
non-assessable; all the outstanding beneficial interests in the Designated
Trust have been duly and validly authorized and issued, are fully paid and
non-assessable and conform in all material respects to the descriptions
thereof contained in the Prospectus;
(h) Each of Southern California Edison Company, Edison Mission Energy
and Edison Capital (the "Significant Subsidiaries") has been duly
incorporated and is validly existing as a corporation in good standing
under the laws of the jurisdiction of its incorporation, has power and
authority (corporate and other) to own, lease and operate its properties
and to conduct its business as described in the Prospectus, and is duly
qualified as a foreign corporation to transact business and is in good
standing in each jurisdiction in which such qualification is required,
whether by reason of ownership or leasing of property or the conduct of
business, except where the failure so to qualify or be in good standing
would not have a material adverse effect on the condition, financial or
otherwise, or the earnings or business affairs of the Company and its
subsidiaries taken as a whole; and all of the issued and outstanding
capital stock of each Significant Subsidiary has been duly authorized and
validly issued, is fully paid and non-assessable and all such shares owned
by the Company, directly or through subsidiaries, are owned free and clear
of any security interest, mortgage, pledge, lien, encumbrance, claim or
security;
5
<PAGE>
(i) When the Designated Securities are issued and delivered pursuant
to this Agreement and the Pricing Agreement with respect to such Designated
Securities and, in the case of any Optional Designated Securities, pursuant
to Over-allotment Options (as defined in Section 3 hereof) with respect to
such Securities, such Designated Securities will be duly and validly
authorized and issued and will be fully paid and non-assessable beneficial
interests in the Designated Trust entitled to the benefits provided by the
applicable Trust Agreement; the issuance of the Designated Securities will
not be subject to preemptive or other similar right; and the Designated
Securities will conform in all material respects to the description thereof
contained in the Prospectus as amended or supplemented with respect to such
Designated Securities;
(j) The holders of the Designated Securities (the "Securityholders")
will be entitled to the same limitation of personal liability extended to
stockholders of private corporations for profit organized under the General
Corporation Law of the State of Delaware;
(k) When the Common Securities of the Designated Trust are issued and
delivered pursuant to the applicable Trust Agreement, such Common
Securities will be duly and validly authorized and issued and will be fully
paid beneficial interests in the Designated Trust and will conform in all
material respects to the description thereof contained in the Prospectus;
the issuance of the Common Securities of the Designated Trust will not be
subject to preemptive or other similar rights; the Common Securities of the
Designated Trust will not be subject to preemptive or other similar rights;
and at each Time of Delivery (as defined in Section 4 hereof), all of the
issued and outstanding Common Securities of the Designated Trust will be
directly owned by the Company free and clear of any security interest,
mortgage, pledge, lien, encumbrance, claim or equity;
(l) The Designated Guarantee, the Agreement as to Expenses and
Liabilities between the Company and the Designated Trust in the form set
forth in Exhibit D to the Trust Agreement (the "Designated Expense
Agreement") (all such Designated Expense Agreements together, the "Expense
Agreements'), the Trust Agreement for the Designated Trust, the Designated
Subordinated Debentures and the Subordinated Indenture (the Designated
Guarantee, the Designated Expense Agreement, such Trust Agreement, the
Designated Subordinated Debentures and the Subordinated Indenture being
collectively referred to as the "Company Agreements") have each been duly
authorized by the Company and, when executed and delivered by the Company
and (i) in the case of the Designated Guarantee, by the Guarantee Trustee
(as defined in the Designated Guarantee), (ii) in the case of the
Designated Expense Agreement, by the Designated Trust, (iii) in the case of
the Trust Agreement, by the Trustees (as defined in the Trust Agreement)
and (iv) in the case of the Subordinated Indenture, by the Indenture
Trustee, and in the case of the Designated Subordinated Debentures, when
authenticated and delivered by the Indenture Trustee, will be duly executed
and delivered by the Company (and, in the case of the Designated
Subordinated Debentures, duly authenticated and issued) and will constitute
at each Time of Delivery valid and legally
6
<PAGE>
binding obligations of the Company, enforceable in accordance with their
respective terms (and, in the case of the Designated Subordinated
Debentures, entitled to the benefits of the Subordinated Indenture),
subject, as to enforcement, to bankruptcy, insolvency, reorganization and
other laws of general applicability relating to or affecting creditors'
rights and to general equity principles; the Trust Agreement, the
Subordinated Indenture and the Designated Guarantee have each been duly
qualified under the Trust Indenture Act; and the Company Agreements, which
will be in substantially the form filed as exhibits to the Registration
Statement, will conform in all material respects to the descriptions
thereof in the Prospectus as amended or supplemented with respect to the
Designated Securities to which they relate;
(m) The issue and sale of the Designated Securities and the Common
Securities by the Designated Trust, the compliance by the Designated Trust
with all of the provisions of this Agreement, any Pricing Agreement and
each Over-allotment Option, if any, the Designated Securities, the
Designated Expense Agreement and the Trust Agreement and the consummation
of the transactions contemplated herein and therein will not conflict with
or result in a breach or violation of any of the terms or provisions of, or
constitute a default under, any material indenture, mortgage, deed of
trust, loan agreement or other agreement or instrument to which such Trust
is a party or by which such Trust is bound or to which any of the property
or assets of such Trust is subject, nor will such action result in any
violation of the provisions of the Certificate of Trust or Trust Agreement
of such Trust or any statute or any order, rule or regulation of any court
or governmental agency or body having jurisdiction over such Trust or any
of its properties; and no consent, approval, authorization, order,
registration or qualification of or with any such court or governmental
agency or body is required for the issue and sale of the Designated
Securities and the Common Securities by such Trust or the consummation by
such Trust of the transactions contemplated by this Agreement, the Pricing
Agreement or any Over-allotment Option, the Designated Securities, the
Designated Expense Agreement or the Trust Agreement, except (i) such as
have been, or will have been, prior to each Time of Delivery, obtained
under the Act and the Trust Indenture Act and (ii) such consents,
approvals, authorizations, registrations or qualifications as may be
required under state securities or Blue Sky laws in connection with the
purchase and distribution of the Designated Securities by the Underwriters;
(n) The issuance by the Company of the Guarantees and the
Subordinated Debentures, the compliance by the Company with all of the
provisions of this Agreement, any Pricing Agreement, the Guarantees, the
Expense Agreements, the Subordinated Debentures, the Trust Agreements and
the Subordinated Indenture, and the consummation of the transactions
contemplated herein and therein will not conflict with or result in a
breach or violation of any of the terms or provisions of, or constitute a
default under, any material indenture, mortgage, deed of trust, loan
agreement or other agreement or instrument to which the Company or any of
its subsidiaries is a party or by which the Company or any of its
subsidiaries is bound or to which any of the property or assets of the
Company or any of its subsidiaries is subject, nor will such action result
in
7
<PAGE>
any violation of the provisions of the Articles of Incorporation or By-
Laws of the Company or any statute or any order, rule or regulation of any
court or governmental agency or body having jurisdiction over the Company
or any of its properties or any of its properties; and no consent,
approval, authorization, order, registration or qualification of or with
any such court or governmental agency or body is required for the issue and
sale of the Guarantees or the Subordinated Debentures or the consummation
by the Company of the transactions contemplated by this Agreement, any
Pricing Agreement, the Guarantees, the Expense Agreements, the Subordinated
Debentures, the Trust Agreements or the Subordinated Indenture, except (i)
such as have been, or will have been, prior to each Time of Delivery,
obtained under the Act or the Trust Indenture Act and (ii) such consents,
approvals, authorizations, registrations or qualifications as may be
required under state securities or Blue Sky laws in connection with the
issuance and sale by the Company of the Guarantees and the Subordinated
Debentures;
(o) Other than as set forth in the Prospectus, there are no legal or
governmental proceedings pending to which the Designated Trust, the Company
or any of its subsidiaries is a party or of which any of their properties
is the subject, which, if determined adversely to the Designated Trust, the
Company or any of its subsidiaries, would individually or in the aggregate
have a material adverse effect on the current or future consolidated
financial position, stockholders' equity or results of operations of either
the Designated Trust or the Company and its subsidiaries taken as a whole;
and, to the best of the Designated Trust's and the Company's knowledge, no
such proceedings are threatened or contemplated by governmental authorities
or threatened by others;
(p) None of the Designated Trust, the Company nor any of its
subsidiaries, as applicable, is in violation of the Trust Agreement for the
Designated Trust, the Certificate of Trust for the Designated Trust, the
Articles of Incorporation or By-Laws of the Company, or the charter or by-
laws of any of its subsidiaries, or in default in the performance or
observance of any obligation, agreement, covenant or condition contained in
any indenture, mortgage, deed of trust, loan agreement, lease or other
agreement or instrument to which it is a party or by which it or any of its
properties may be bound, other than any such violation or default that
would not, individually or in the aggregate, have a material adverse effect
on or affecting the general affairs, management, financial position,
stockholders' equity or results of operations of either the Designated
Trust or the Company and its subsidiaries taken as a whole;
(q) The Company and its subsidiaries possess such certificates,
authorities or permits issued by the appropriate state, federal or foreign
regulatory agencies or bodies necessary to conduct the business now
operated by them, except where the failure to possess such certificates,
authorities or permits, individually or in the aggregate, would not have a
material adverse effect on the condition, financial or otherwise, or the
earnings or business affairs of the Company and its subsidiaries taken as a
whole; and neither the Company nor any of its subsidiaries has received any
notice of proceedings relating to the revocation or modification of any
such certificate, authority or permit which, individually
8
<PAGE>
or in the aggregate, if the subject of an unfavorable decision, ruling or
finding, would materially and adversely affect the condition, financial or
otherwise, or the earnings or business affairs of the Company and its
subsidiaries taken as a whole;
(r) The financial statements of the Company and its consolidated
subsidiaries included or incorporated by reference in the Registration
Statement and Prospectus present fairly in all material respects the
consolidated financial position of the Company and its consolidated
subsidiaries as of the dates indicated and the consolidated results of
their operations for the periods specified; and, except as stated therein,
such financial statements have been prepared in conformity with generally
accepted accounting principles in the United States applied on a consistent
basis;
(s) The statements set forth in (i) the Prospectus under the captions
"Description of Securities", "Description of Debt Securities", "Description
of Preferred Securities", "Description of Preferred Securities Guarantees",
"Description of Expense Agreements" and "Relationship among Preferred
Securities, Preferred Securities Guarantees and Subordinated Debt
Securities Held by Each Trust" and (ii) in the Prospectus as amended or
supplemented under the captions "Description of Series __ QUIPS" and
"Description of Series __ QUIDS", insofar as they constitute a summary of
the terms of the Securities, the Subordinated Debentures, the Guarantees,
the Expense Agreements and the Company Agreements (including the Designated
Securities, the Designated Subordinated Debentures, the Designated
Guarantee and the Designated Expense Agreement) and (x) in the Prospectus
under the caption "Plan of Distribution" and (y) in the Prospectus as
amended or supplemented under the captions "Underwriting" and "Material
United States Federal Income Tax Considerations", insofar as they purport
to describe the provisions of the laws and documents referred to therein,
in each case are accurate, complete and fair;
(t) Neither the Designated Trust nor the Company nor any of its
subsidiaries is or, after giving effect to the offering and sale of the
Securities, will be, an "investment company" or an entity "controlled" by
an "investment company", as such term is defined in the Investment Company
Act of 1940, as amended (the "Investment Company Act");
(u) Arthur Andersen LLP, who have certified certain financial
statements of the Company and its subsidiaries, are independent public
accountants as required by the Act and the rules and regulations of the
Commission thereunder; and
(v) The Company has reviewed its operations and that of its
subsidiaries and any third parties with which the Company and its
subsidiaries taken as a whole have a material relationship, to evaluate the
extent to which the business or operations of the Company and its
subsidiaries taken as a whole will be affected by the Year 2000 Problem.
As a result of such review, the Company does not believe that the Year 2000
Problem will have a material adverse effect on the general affairs,
management, the current or future consolidated financial position, business
prospects, stockholders' equity or results of operations of the Company and
its subsidiaries taken as a whole or result in
9
<PAGE>
any material loss or interference with the business or operations of the
Company and its subsidiaries taken as a whole. The "Year 2000 Problem" as
used herein means any significant risk that computer hardware or software
used by the Company or any of its subsidiaries in the receipt,
transmission, processing, manipulation, storage, retrieval, retransmission
or other utilization of data or in the operation of mechanical or
electrical systems of any kind will not, in the case of dates or time
periods occurring after December 31, 1999, function at least as effectively
as in the case of dates or time periods occurring prior to January 1, 2000.
3. Upon the execution of the Pricing Agreement applicable to any Firm
Designated Securities and authorization by the Representatives of the release of
such Firm Designated Securities, the several Underwriters propose to offer such
Firm Designated Securities for sale upon the terms and conditions set forth in
the Prospectus as amended or supplemented.
The Designated Trust may specify in the Pricing Agreement applicable
to any Designated Securities that the Designated Trust thereby grants to the
Underwriters the right (an "Over-allotment Option") to purchase at their
election up to the number of Optional Designated Securities set forth in such
Pricing Agreement, on the terms set forth therein, for the sole purpose of
covering over-allotments in the sale of the Firm Designated Securities. Any such
election to purchase Optional Designated Securities may be exercised by written
notice from the Representatives to the Designated Trust and the Company, given
within a period specified in the Pricing Agreement, setting forth the aggregate
number of Optional Designated Securities to be purchased and the date on which
such Optional Designated Securities are to be delivered, as determined by the
Representatives but in no event earlier than the First Time of Delivery (as
defined in Section 4 hereof) or, unless the Representatives, the Designated
Trust and the Company otherwise agree in writing, earlier than or later than the
respective number of business days after the date of such notice set forth in
such Pricing Agreement.
The Number of Optional Designated Securities to be added to the number of
Firm Designated Securities to be purchased by each Underwriter as set forth in
Schedule I to the Pricing Agreement applicable to such Designated Securities
shall be, in each case, the number of Optional Designated Securities which the
Designated Trust and the Company have been advised by the Representatives have
been attributed to such Underwriter; provided that, if the Designated Trust and
the Company have not been so advised, the number of Optional Designated
Securities to be so added shall be, in each case, that proportion of Optional
Designated Securities which the number of Firm Designated Securities to be
purchased by such Underwriter under such Pricing Agreement bears to the
aggregate number of Firm Designated Securities (rounded as the Representatives
may determine to the nearest 100 securities). The total number of Designated
Securities to be purchased by all the Underwriters pursuant to such Pricing
Agreement shall be the aggregate number of Firm Designated Securities set forth
in Schedule I to such Pricing Agreement plus the aggregate number of Optional
Designated Securities which the Underwriters elect to purchase.
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As compensation to the Underwriters of the Designated Securities for their
commitments hereunder and under the Pricing Agreement, and in view of the fact
that the proceeds of the sale of the Designated Securities will be used by the
Designated Trust to purchase the Designated Subordinated Debentures of the
Company, the Company agrees to pay at each Time of Delivery to the
Representatives, for the accounts of the several Underwriters, the amount set
forth in the Pricing Agreement per Designated Security for the Designated
Securities to be delivered at each Time of Delivery.
4. Certificates for the Firm Designated Securities and the Optional
Designated Securities to be purchased by each Underwriter pursuant to the
Pricing Agreement relating thereto, in the form specified in the Trust
Agreement, and in such authorized denominations and registered in such names as
the Representatives may request upon at least forty-eight hours' prior notice to
the Designated Trust and the Company, shall be delivered by or on behalf of the
Designated Trust to the Representatives for the account of such Underwriter,
against payment by such Underwriter or on its behalf of the purchase price
therefor by wire transfer of Federal (same-day) funds to an account designated
by the Designated Trust, (i) with respect to the Firm Designated Securities, all
in the manner and at the place and time and date specified in such Pricing
Agreement or at such other place and time and date as the Representatives, the
Designated Trust and the Company may agree upon in writing, such time and place
being herein called the "First Time of Delivery" and (ii) with respect to the
Optional Designated Securities, if any, in the manner and at the time and date
specified by the Representatives in the written notice given by the
Representatives of the Underwriters' election to purchase such Optional
Designated Securities, or at such other time and date as the Representatives,
the Designated Trust and the Company may agree upon in writing, such time and
date, if not the First Time of Delivery, being herein called the "Second Time of
Delivery." Each such time and date for delivery is herein called a "Time of
Delivery".
5. The Designated Trust and the Company, jointly and severally, agree
with each of the Underwriters of any Designated Securities:
(a) To prepare the Prospectus as amended or supplemented in relation
to the applicable Designated Securities in a form approved by the
Representatives and to file such Prospectus pursuant to Rule 424(b) under
the Act not later than the Commission's close of business on the second
business day following the execution and delivery of the Pricing Agreement
relating to the applicable Designated Securities or, if applicable, such
earlier time as may be required by Rule 424(b); to make no further
amendment or any supplement to the Registration Statement or Prospectus as
amended or supplemented after the date of the Pricing Agreement relating to
such Securities and prior to the last Time of Delivery for such Securities
which shall be disapproved by the Representatives for such Securities
promptly after reasonable notice thereof; to advise the Representatives
promptly of any such amendment or supplement after such Time of Delivery
and furnish the Representatives with copies thereof; to file promptly all
reports and any definitive proxy or information statements required to be
filed by the Company with the Commission pursuant to Section 13(a), 13(c),
14 or 15(d) of the Exchange Act for so
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<PAGE>
long as the delivery of a prospectus is required in connection with the
offering or sale of such Securities, and during such same period to advise
the Representatives, promptly after it receives notice thereof, of the time
when any amendment to the Registration Statement has been filed or becomes
effective or any supplement to the Prospectus or any amended Prospectus has
been filed with the Commission, of the issuance by the Commission of any
stop order or of any order preventing or suspending the use of any
prospectus relating to the Securities, of the suspension of the
qualification of such Securities for offering or sale in any jurisdiction,
of the initiation or threatening of any proceeding for any such purpose, or
of any request by the Commission for the amending or supplementing of the
Registration Statement or Prospectus or for additional information; and, in
the event of the issuance of any such stop order or of any such order
preventing or suspending the use of any prospectus relating to the
Securities or suspending any such qualification, to promptly use its
commercially reasonable efforts to obtain the withdrawal of such order;
(b) Promptly from time to time to take such action as the
Representatives may reasonably request to qualify such Designated
Securities or the Designated Subordinated Debentures for offering and sale
under the securities laws of such jurisdictions as the Representatives may
request and to comply with such laws so as to permit the continuance of
sales and dealings therein in such jurisdictions for as long as may be
necessary to complete the distribution of such Designated Securities,
provided that in connection therewith neither the Designated Trust nor the
Company shall be required to (i) qualify as a foreign corporation, (ii)
file a general consent to service of process in any jurisdiction or (iii)
comply with any other requirement in connection with such qualification
deemed by the Company to be unduly burdensome;
(c) Prior to 10:00 a.m., New York City time, on the New York Business
Day next succeeding the date of the Pricing Agreement for such Designated
Securities or such later time or date as agreed to by the Designated Trust,
the Company and the Representatives, and from time to time, to furnish the
Underwriters with copies of the Prospectus in New York City as amended or
supplemented in such quantities as the Representatives may reasonably
request, and, if the delivery of a prospectus is required at any time in
connection with the offering or sale of the Designated Securities or the
Designated Subordinated Debentures and if at such time any event shall have
occurred as a result of which the Prospectus as then amended or
supplemented would include an untrue statement of a material fact or omit
to state any material fact necessary in order to make the statements
therein, in the light of the circumstances under which they were made when
such Prospectus is delivered, not misleading, or, if for any other reason
it shall be necessary during such same period to amend or supplement the
Prospectus or to file under the Exchange Act any document incorporated by
reference in the Prospectus in order to comply with the Act, the Exchange
Act or the Trust Indenture Act, to notify the Representatives and upon
their request to file such document and to prepare and furnish without
charge to each Underwriter and to any dealer in securities as many copies
as the Representatives may from time to time reasonably request of an
amended Prospectus or a
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<PAGE>
supplement to the Prospectus which will correct such statement or omission
or effect such compliance;
(d) In the case of the Company, to make generally available to its
securityholders as soon as practicable, but in any event not later than
eighteen months after the effective date of the Registration Statement (as
defined in Rule 158(c) under the Act), an earnings statement of the Company
and its subsidiaries (which need not be audited) complying with Section
11(a) of the Act and the rules and regulations of the Commission thereunder
(including, at the option of the Company, Rule 158);
(e) During the period beginning from the date of the Pricing
Agreement for such Designated Securities and continuing to and including
the later of (i) the termination of trading restrictions for such
Designated Securities, as notified to the Designated Trust and the Company
by the Representatives and (ii) 30 days after the last Time of Delivery for
such Designated Securities, not to offer, sell, contract to sell or
otherwise dispose of any Securities, any other beneficial interests in the
assets of any Trust, or any preferred securities or any other securities of
any Trust or the Company, as the case may be, that are substantially
similar to such Designated Securities (including any guarantee of such
securities) or any securities that are convertible into or exchangeable
for, or that represent the right to receive, Securities, preferred
securities or any such substantially similar securities of any Trust or the
Company, or any debt securities of the Company (other than the Designated
Subordinated Debentures) which mature more than one year after such Time of
Delivery and which are substantially similar to such Designated Securities,
without the prior written consent of the Representatives;
(f) In the case of the Company, to issue the Designated Guarantee
concurrently with the issue and sale of the Designated Securities as
contemplated herein or in the Pricing Agreement;
(g) To use its best efforts to list within 30 days following the
First Time of Delivery, subject to notice of issuance, the Designated
Securities on the New York Stock Exchange and, if the Company elects to
dissolve the Designated Trust and to distribute the Designated Subordinated
Debentures to the holders of the Designated Securities in liquidation of
the Designated Trust, to use its best efforts to list the Designated
Subordinated Debentures on the New York Stock Exchange prior to such
distribution; and
(h) If the Designated Trust and the Company elect to rely upon Rule
462(b), the Designated Trust and the Company shall file a Rule 462(b)
Registration Statement with the Commission in compliance with Rule 462(b)
by 10:00 P.M., Washington, D.C. time, on the date of this Agreement, and
the Designated Trust and the Company shall at the time of filing either pay
to the Commission the filing fee for the Rule 462(b) Registration Statement
or give irrevocable instructions for the payment of such fee pursuant to
Rule 111(b) under the Act.
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<PAGE>
6. The Company covenants and agrees with the several Underwriters that the
Company will pay or cause to be paid the following: (i) the fees, disbursements
and expenses of the Company's counsel and accountants in connection with the
registration of the Securities, the Guarantees and the Subordinated Debentures
under the Act and all other expenses in connection with the preparation,
printing and filing of the Registration Statement, any Preliminary Prospectus
and the Prospectus and amendments and supplements thereto and the mailing and
delivering of copies thereof to the Underwriters and dealers; (ii) the cost of
printing or producing any Agreement among Underwriters, this Agreement, any
Pricing Agreement, any Company Agreement (including any amendment or supplement
to the Subordinated Indenture), the Securities, any Blue Sky and Legal
Investment Memoranda, closing documents (including any compilations thereof) and
any other documents in connection with the offering, purchase, sale and delivery
of the Securities; (iii) all expenses in connection with the qualification of
the Securities for offering and sale under state securities laws as provided in
Section 5(b) hereof, including the reasonable fees and disbursements of counsel
for the Underwriters in connection with such qualification and in connection
with the Blue Sky and Legal Investment Surveys; (iv) any fees charged by
securities rating services for rating the Securities and the Subordinated
Debentures; (v) any filing fees incident to, and the reasonable fees and
disbursements of counsel for the Underwriters in connection with, any required
review by the National Association of Securities Dealers, Inc. of the terms of
the sale of the Securities and the issuance of the Guarantees and the
Subordinated Debentures; (vi) the cost of preparing the Securities and the
Subordinated Debentures; (vii) the fees and expenses of any Indenture Trustee,
Guarantee Trustee or other trustee (including any trustee under any Trust
Agreement), and any agent of any such trustee and the reasonable fees and
disbursements of counsel for any such trustee in connection with any Trust
Agreement, the Subordinated Indenture, any Guarantee, the Securities and the
Subordinated Debentures; (viii) the cost of qualifying the Securities and the
Subordinated Debentures with The Depository Trust Company; (ix) any fees and
expenses in connection with listing the Securities and the Subordinated
Debentures and the cost of registering the Securities under Section 12 of the
Exchange Act; and (x) all other costs and expenses incident to the performance
of its obligations hereunder and under any Over-allotment Options which are not
otherwise specifically provided for in this Section. It is understood, however,
that, except as provided in this Section, and Sections 8 and 11 hereof, the
Underwriters will pay all of their own costs and expenses, including the fees of
their counsel, transfer taxes on resale of any of the Securities by them, and
any advertising expenses connected with any offers they may make.
7. The obligations of the Underwriters of any Designated Securities under
the Pricing Agreement relating to such Designated Securities shall be subject,
in the discretion of the Representatives, to the condition that all
representations and warranties and other statements of the Designated Trust and
the Company in or incorporated by reference in the Pricing Agreement relating to
such Designated Securities are, at and as of each Time of Delivery for such
Designated Securities, true and correct, the condition that the Designated Trust
and the Company shall have performed all of their respective obligations
hereunder theretofore to be performed, and the following additional conditions:
14
<PAGE>
(a) The Prospectus as amended or supplemented in relation to the
applicable Designated Securities shall have been filed with the Commission
pursuant to Rule 424(b) within the applicable time period prescribed for
such filing by the rules and regulations under the Act and in accordance
with Section 5(a) hereof; if the Designated Trust and the Company have
elected to rely upon Rule 462(b), the Rule 462(b) Registration Statement
shall have become effective by 10:00 P.M., Washington, D.C. time, on the
date of this Agreement; no stop order suspending the effectiveness of the
Registration Statement or any part thereof shall have been issued and no
proceeding for that purpose shall have been initiated or threatened by the
Commission; and all requests for additional information on the part of the
Commission shall have been complied with to the Representatives' reasonable
satisfaction;
(b) Counsel for the Underwriters shall have furnished to the
Representatives such written opinion or opinions, dated each Time of
Delivery for such Designated Securities, with respect to the Registration
Statement and the Prospectus as amended or supplemented, as well as such
other related matters as the Representatives may reasonably request, and
such counsel shall have received such papers and information as they may
reasonably request to enable them to pass upon such matters;
(c) Counsel for the Company and the Designated Trust satisfactory to
the Representatives shall have furnished to the Representatives their
written opinion or opinions, dated each Time of Delivery for such
Designated Securities, in form and substance satisfactory to the
Representatives, (i) to the effect set forth in Annex III hereto and (ii)
to the effect that
(i) The Registration Statement and the Prospectus as amended
or supplemented (in each case, excluding the documents incorporated by
reference therein) comply as to form in all material respects with the
requirements for registration statements on Form S-3 under the Act,
and the requirements under the Trust Indenture Act and the rules and
regulations of the Commission thereunder; it being understood,
however, that such counsel expresses no opinion with respect to the
financial statements, schedules or other financial data included or
incorporated by reference in, or omitted from, the Registration
Statement or the Prospectus as amended or supplemented or with respect
to the Form T-1's. In passing upon the compliance as to form of the
Registration Statement and the Prospectus as amended or supplemented
(in each case, excluding the documents incorporated by reference
therein), such counsel has assumed that the statements made and
incorporated by reference therein are correct and complete; and
(ii) Such counsel has participated in telephone conferences with
officers and other representatives of the Company, and representatives
of the Underwriters, at which the contents of the Registration
Statement and the Prospectus as amended or supplemented and related
matters were discussed and, although such counsel is not passing upon,
and do not assume any responsibility for, the accuracy, completeness
or fairness of the statements contained or incorporated by reference
in the Registration Statement and the Prospectus as amended or
supplemented and has not made any independent check or verification
thereof, during the course of such participation, no facts came to
such counsel's attention that caused them to believe that the
Registration Statement, at the time it became effective, contained an
untrue statement of a material fact or omitted to state a material
fact required to be stated therein or necessary to make the statements
therein not misleading, or that the Prospectus as amended or
supplemented (including the documents incorporated by reference), as
of its date or as of the date thereof, contained or contains an untrue
statement of a material fact or omitted or omits to state a material
fact necessary to make the statements therein, in light of the
circumstances under which they were made, not misleading; it being
understood that such counsel expresses no belief with respect to the
financial statements or other financial data included or incorporated
by reference in, or omitted from, the Registration Statement or the
Prospectus as amended or supplemented or with respect to the Form
T-1's.
(d) Special Delaware counsel to the Designated Trust and the Company
satisfactory to the Representatives shall have furnished to the
Representatives, the Company and the Designated Trust their written
opinion, dated the respective Time of Delivery, in form and substance
satisfactory to the Representatives, to the effect that
(i) The Designated Trust has been duly created and is validly
existing in good standing as a business trust under the Delaware
Business Trust Act, and all filings required under the laws of the
State of Delaware with respect to the creation and valid existence of
the Designated Trust as a business trust have been made;
(ii) Under the Delaware Business Trust Act and the Trust
Agreement, the Designated Trust has the trust power and authority to
own property and conduct its business, all as described in the
Prospectus as amended or supplemented;
(iii) The Trust Agreement constitutes a valid and binding
obligation of the Company and the Trustees, and is enforceable against
the Company and the Trustees, in accordance with its terms, subject,
as to enforcement, to bankruptcy, insolvency, receivership,
liquidation, fraudulent conveyance, fraudulent transfer,
reorganization, moratorium and similar laws of general applicability
relating to or
15
<PAGE>
affecting creditors' rights, to general equity principles, including
applicable law relating to fiduciary duties (regardless of whether
considered and applied in a proceeding in equity or at law), and to
the effect of applicable public policy on the enforceability of
provisions relating to indemnification or contribution;
(iv) Under the Delaware Business Trust Act and the Trust
Agreement, the Designated Trust has the requisite trust power and
authority to (a) execute, deliver and perform its obligations under
this Agreement and the Pricing Agreement and (b) issue and perform its
obligations under the Designated Securities and the Common Securities
of the Designated Trust;
(v) Under the Delaware Business Trust Act and the Trust
Agreement, the execution and delivery by the Designated Trust of this
Agreement and the Pricing Agreement, and the performance by the
Designated Trust of its obligations hereunder and thereunder, have
been duly authorized by the requisite trust action on the part of the
Designated Trust;
(vi) The Designated Securities have been duly authorized by the
Trust Agreement and are duly and validly issued and, subject to the
qualifications set forth therein, fully paid and non-assessable
beneficial interests in the Designated Trust and are entitled to the
benefits provided by the Trust Agreement; the holders of the
Designated Securities, as beneficial owners of the Designated Trust,
will be entitled to the same limitation of personal liability extended
to stockholders of private corporations for profit organized under the
General Corporation Law of the State of Delaware; provided that such
counsel may note that the holders of the Designated Securities may be
obligated, pursuant to the Trust Agreement, to (a) provide indemnity
and/or security in connection with and pay taxes or governmental
charges arising from transfers or exchanges of certificates evidencing
the Designated Securities and the issuance of replacement certificates
and (b) provide security and indemnity in connection with requests of
or directions to the Property Trustee (as defined in the Trust
Agreement) to exercise its rights and remedies under the Trust
Agreement;
(vii) The Common Securities of the Designated Trust have been
duly authorized by the Trust Agreement and are validly issued and
represent beneficial interests in the Designated Trust;
(viii) Under the Delaware Business Trust Act and the Trust
Agreement, the issuance of the Designated Securities and the Common
Securities of the Designated Trust is not subject to preemptive
rights;
(ix) The issuance and sale by the Designated Trust of
Designated Securities and the Common Securities of the Designated
Trust, the execution, delivery and performance by the Designated Trust
of this Agreement and the Pricing Agreement, the consummation by the
Designated Trust of the transactions
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<PAGE>
contemplated hereby and thereby and compliance by the Designated Trust
with its obligations hereunder and thereunder will not violate (a) any
of the provisions of the Certificate of Trust of the Designated Trust
or the Trust Agreement, or (b) and applicable Delaware law or
administrative regulation;
(x) Assuming that the Designated Trust derives no income from or
connected with sources within the State of Delaware and has no assets,
activities (other than maintaining the Delaware Trustee (as defined in
the Trust Agreement) and the filing of documents with the Secretary of
State of the State of Delaware) or employees in the State of Delaware,
no authorization, approval, consent or order of any Delaware court or
governmental authority or agency is required to be obtained by the
Designated Trust solely in connection with the issuance and sale of
the Designated Securities and the Common Securities of the Designated
Trust. (In rendering the opinion expressed in this paragraph (x),
such counsel need express no opinion concerning the securities laws of
the State of Delaware); and
(xi) Assuming that the Designated Trust derives no income from or
connected with sources within the State of Delaware and has no assets,
activities (other than maintaining the Delaware Trustee and the filing
of documents with the Secretary of State of the State of Delaware) or
employees in the State of Delaware and assuming that the Designated
Trust is treated as a grantor trust for Federal income tax purposes,
the holders of the Designated Securities (other than those holders who
reside or are domiciled in the State of Delaware) will have no
liability for income taxes imposed by the State of Delaware solely as
a result of their participation in the Designated Trust, and the
Designated Trust will not be liable for any income tax imposed by the
State of Delaware.
(e) Tax counsel for the Designated Trust and the Company satisfactory
to the Representatives shall have furnished to the Representatives their
written opinion, dated the respective Time of Delivery, in form and
substance satisfactory to the Representatives, to the effect that such firm
confirms its opinion set forth in the Prospectus as amended or supplemented
under the caption "Material United States Federal Income Tax
Considerations";
(f) On the date of the Pricing Agreement for such Designated
Securities at a time prior to the execution of the Pricing Agreement with
respect to such Designated Securities and at each Time of Delivery for such
Designated Securities, the independent accountants of the Company who have
certified the financial statements of the Company and its subsidiaries
included or incorporated by reference in the Registration Statement shall
have furnished to the Representatives a letter, dated the effective date of
the Registration Statement or the date of the most recent report filed with
the Commission containing financial statements and incorporated by
reference in the Registration Statement, if the date of such report is
later than such effective date, and a letter dated such Time of Delivery,
respectively, to the effect set forth in Annex II hereto, and with
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<PAGE>
respect to such letter dated such Time of Delivery, as to such other
matters as the Representatives may reasonably request and in form and
substance satisfactory to the Representatives;
(g) (i) Neither the Designated Trust nor the Company and its
subsidiaries (other than the Designated Trust) taken as a whole shall have
sustained since the date of the latest audited financial statements
included or incorporated by reference in the Prospectus as amended prior to
the date of the Pricing Agreement relating to the Designated Securities any
loss or interference with its business from fire, explosion, flood or other
calamity, whether or not covered by insurance, or from any labor dispute or
court or governmental action, order or decree, otherwise than as set forth
or contemplated in the Prospectus as amended or supplemented prior to the
date of the Pricing Agreement relating to the Designated Securities, and
(ii) since the respective dates as of which information is given in the
Prospectus as amended prior to the date of the Pricing Agreement relating
to the Designated Securities there shall not have been any change in the
capital stock or long-term debt of the Designated Trust or the Company and
its subsidiaries (other than the Designated Trust) taken as a whole or any
change, or any development involving a prospective change, in or affecting
the general affairs, management, financial position, stockholders' equity
or results of operations of the Designated Trust or the Company and its
subsidiaries (other than the Designated Trust) taken as a whole, otherwise
than as set forth or contemplated in the Prospectus as amended or
supplemented prior to the date of the Pricing Agreement relating to the
Designated Securities, the effect of which, in any such case described in
clause (i) or (ii), is in the judgment of the Representatives so material
and adverse as to make it impracticable or inadvisable to proceed with the
public offering or the delivery of the Firm Designated Securities or
Optional Designated Securities or both on the terms and in the manner
contemplated in the Prospectus as first amended or supplemented relating to
the Designated Securities;
(h) On or after the date of the Pricing Agreement relating to the
Designated Securities (i) no downgrading shall have occurred in the rating
accorded the Company's debt securities or preferred stock by any
"nationally recognized statistical rating organization", as that term is
defined by the Commission for purposes of Rule 436(g)(2) under the Act, and
(ii) no such organization shall have publicly announced that it has under
surveillance or review, with possible negative implications, its rating of
any of the Company's debt securities or preferred stock;
(i) On or after the date of the Pricing Agreement relating to the
Designated Securities there shall not have occurred any of the following:
(i) a suspension or material limitation in trading in securities generally
on the New York Stock Exchange; (ii) a suspension or material limitation in
trading in the Company's securities on the New York Stock Exchange; (iii) a
general moratorium on commercial banking activities declared by Federal or
New York State or State of California authorities; or (iv) the outbreak or
escalation of hostilities involving the United States or the declaration by
the United States
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<PAGE>
of a national emergency or war, if the effect of any such event specified
in this clause (iv) in the judgment of the Representatives makes it
impracticable or inadvisable to proceed with the public offering or the
delivery of the Firm Designated Securities or Optional Designated
Securities or both on the terms and in the manner contemplated in the
Prospectus as first amended or supplemented relating to the Designated
Securities;
(j) The Company shall have complied with the provisions of Section
5(c) hereof with respect to the furnishing of prospectuses on the New York
Business Day next succeeding the date of this Agreement or such later date
as agreed to among the Designated Trust, the Company and the
Representatives; and
(k) The Designated Trust and the Company shall have furnished or
caused to be furnished to the Representatives at each Time of Delivery for
the Designated Securities certificates of officers of the Designated Trust
and the Company satisfactory to the Representatives as to the accuracy of
the representations and warranties of the Designated Trust and the Company
herein at and as of such Time of Delivery, as to the performance by the
Designated Trust and the Company of all of its obligations hereunder to be
performed at or prior to such Time of Delivery, as to the matters set forth
in subsections (a) and (g) of this Section and as to such other matters as
the Representatives may reasonably request.
8. (a) The Designated Trust and the Company, jointly and severally, will
indemnify and hold harmless each Underwriter against any losses, claims, damages
or liabilities, joint or several, to which such Underwriter may become subject,
under the Act or otherwise, insofar as such losses, claims, damages or
liabilities (or actions in respect thereof) arise out of or are based upon an
untrue statement or alleged untrue statement of a material fact contained in any
Preliminary Prospectus, any preliminary prospectus supplement, the Registration
Statement, the Prospectus as amended or supplemented and any other prospectus
relating to the Designated Securities, or any amendment or supplement thereto,
or arise out of or are based upon the omission or alleged omission to state
therein a material fact required to be stated therein or necessary to make the
statements therein not misleading, and will reimburse each Underwriter for any
legal or other expenses reasonably incurred by such Underwriter in connection
with investigating or defending any such action or claim as such expenses are
incurred; provided, however, that neither the Designated Trust nor the Company
shall be liable in any such case to the extent that any such loss, claim, damage
or liability arises out of or is based upon an untrue statement or alleged
untrue statement or omission or alleged omission made in any Preliminary
Prospectus, any preliminary prospectus supplement, the Registration Statement,
the Prospectus as amended or supplemented and any other prospectus relating to
the Designated Securities, or any such amendment or supplement, in reliance upon
and in conformity with written information furnished to the Designated Trust and
the Company by any Underwriter of Designated Securities through the
Representatives expressly for use in the Prospectus as amended or supplemented
relating to such Securities.
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(b) Each Underwriter will indemnify and hold harmless the Designated Trust
and the Company against any losses, claims, damages or liabilities to which the
Designated Trust may become subject, under the Act or otherwise, insofar as such
losses, claims, damages or liabilities (or actions in respect thereof) arise out
of or are based upon an untrue statement or alleged untrue statement of a
material fact contained in any Preliminary Prospectus, any preliminary
prospectus supplement, the Registration Statement, the Prospectus as amended or
supplemented and any other prospectus relating to the Designated Securities, or
any amendment or supplement thereto, or arise out of or are based upon the
omission or alleged omission to state therein a material fact required to be
stated therein or necessary to make the statements therein not misleading, in
each case to the extent, but only to the extent, that such untrue statement or
alleged untrue statement or omission or alleged omission was made in any
Preliminary Prospectus, any preliminary prospectus supplement, the Registration
Statement, the Prospectus as amended or supplemented and any other prospectus
relating to the Designated Securities, or any such amendment or supplement, in
reliance upon and in conformity with written information furnished to the
Designated Trust and the Company by such Underwriter through the Representatives
expressly for use therein; and will reimburse the Designated Trust and the
Company for any legal or other expenses reasonably incurred by the Company or
the Designated Trust in connection with investigating or defending any such
action or claim as such expenses are incurred.
(c) Promptly after receipt by an indemnified party under subsection (a) or
(b) above of notice of the commencement of any action, such indemnified party
shall, if a claim in respect thereof is to be made against the indemnifying
party under such subsection, notify the indemnifying party in writing of the
commencement thereof; but the omission so to notify the indemnifying party shall
not relieve it from any liability which it may have to any indemnified party
otherwise than under such subsection. In case any such action shall be brought
against any indemnified party and it shall notify the indemnifying party of the
commencement thereof, the indemnifying party shall be entitled to participate
therein and, to the extent that it shall wish, jointly with any other
indemnifying party similarly notified, to assume the defense thereof, with
counsel satisfactory to such indemnified party (who shall not, except with the
consent of the indemnified party, be counsel to the indemnifying party), and,
after notice from the indemnifying party to such indemnified party of its
election so to assume the defense thereof, the indemnifying party shall not be
liable to such indemnified party under such subsection for any legal expenses of
other counsel or any other expenses, in each case subsequently incurred by such
indemnified party, in connection with the defense thereof other than reasonable
costs of investigation. No indemnifying party shall, without the written
consent of the indemnified party, effect the settlement or compromise of, or
consent to the entry of any judgment with respect to, any pending or threatened
action or claim in respect of which indemnification or contribution may be
sought hereunder (whether or not the indemnified party is an actual or potential
party to such action or claim) unless such settlement, compromise or judgment
(i) includes an unconditional release of the indemnified party from all
liability arising out of such action or claim and (ii) does not include a
statement as to or an admission of fault, culpability or a failure to act, by or
on behalf of any indemnified party.
20
<PAGE>
(d) If the indemnification provided for in this Section 8 is unavailable to
or insufficient to hold harmless an indemnified party under subsection (a) or
(b) above in respect of any losses, claims, damages or liabilities (or actions
in respect thereof) referred to therein, then each indemnifying party shall
contribute to the amount paid or payable by such indemnified party as a result
of such losses, claims, damages or liabilities (or actions in respect thereof)
in such proportion as is appropriate to reflect the relative benefits received
by the Designated Trust and the Company on the one hand and the Underwriters of
the Designated Securities on the other from the offering of the Designated
Securities to which such loss, claim, damage or liability (or action in respect
thereof) relates. If, however, the allocation provided by the immediately
preceding sentence is not permitted by applicable law or if the indemnified
party failed to give the notice required under subsection (c) above, then each
indemnifying party shall contribute to such amount paid or payable by such
indemnified party in such proportion as is appropriate to reflect not only such
relative benefits but also the relative fault of the Designated Trust and the
Company on the one hand and the Underwriters of the Designated Securities on the
other in connection with the statements or omissions which resulted in such
losses, claims, damages or liabilities (or actions in respect thereof), as well
as any other relevant equitable considerations. The relative benefits received
by the Designated Trust and the Company on the one hand and such Underwriters on
the other shall be deemed to be in the same proportion as the total net proceeds
from such offering (before deducting expenses) received by the Designated Trust
and the Company bear to the total underwriting discounts and commissions
received by such Underwriters. The relative fault shall be determined by
reference to, among other things, whether the untrue or alleged untrue statement
of a material fact or the omission or alleged omission to state a material fact
relates to information supplied by the Designated Trust and the Company on the
one hand or such Underwriters on the other and the parties' relative intent,
knowledge, access to information and opportunity to correct or prevent such
statement or omission. The Designated Trust, the Company and the Underwriters
agree that it would not be just and equitable if contribution pursuant to this
subsection (d) were determined by pro rata allocation (even if the Underwriters
were treated as one entity for such purpose) or by any other method of
allocation which does not take account of the equitable considerations referred
to above in this subsection (d). The amount paid or payable by an indemnified
party as a result of the losses, claims, damages or liabilities (or actions in
respect thereof) referred to above in this subsection (d) shall be deemed to
include any legal or other expenses reasonably incurred by such indemnified
party in connection with investigating or defending any such action or claim.
Notwithstanding the provisions of this subsection (d), no Underwriter shall be
required to contribute any amount in excess of the amount by which the total
price at which the applicable Designated Securities underwritten by it and
distributed to the public were offered to the public exceeds the amount of any
damages which such Underwriter has otherwise been required to pay by reason of
such untrue or alleged untrue statement or omission or alleged omission. No
person guilty of fraudulent misrepresentation (within the meaning of Section
11(f) of the Act) shall be entitled to contribution from any person who was not
guilty of such fraudulent misrepresentation. The obligations of the
Underwriters of Designated Securities in this subsection (d) to contribute are
several in proportion to their respective underwriting obligations with respect
to such Securities and not joint.
21
<PAGE>
(e) The obligations of the Designated Trust and the Company under this
Section 8 shall be in addition to any liability which the Designated Trust or
the Company may otherwise have and shall extend, upon the same terms and
conditions, to each person, if any, who controls any Underwriter within the
meaning of the Act; and the obligations of the Underwriters under this Section 8
shall be in addition to any liability which the respective Underwriters may
otherwise have and shall extend, upon the same terms and conditions, to each
officer and director of the Designated Trust or the Company and to each person,
if any, who controls the Designated Trust or the Company within the meaning of
the Act.
9. (a) If any Underwriter shall default in its obligation to purchase
the Firm Designated Securities or Optional Designated Securities which it has
agreed to purchase under the Pricing Agreement relating to such Designated
Securities, the Representatives may in their discretion arrange for themselves
or another party or other parties to purchase such Designated Securities on the
terms contained herein. If within thirty-six hours after such default by any
Underwriter the Representatives do not arrange for the purchase of such Firm
Designated Securities or Optional Designated Securities, as the case may be,
then the Designated Trust and the Company shall be entitled to a further period
of thirty-six hours within which to procure another party or other parties
satisfactory to the Representatives to purchase such Designated Securities on
such terms. In the event that, within the respective prescribed period, the
Representatives notify the Designated Trust and the Company that they have so
arranged for the purchase of such Designated Securities, or the Designated Trust
and the Company notify the Representatives that it has so arranged for the
purchase of such Designated Securities, the Representatives or the Designated
Trust and the Company shall have the right to postpone a Time of Delivery for
such Designated Securities for a period of not more than seven days, in order to
effect whatever changes may thereby be made necessary in the Registration
Statement or the Prospectus as amended or supplemented, or in any other
documents or arrangements, and the Designated Trust and the Company agree to
file promptly any amendments or supplements to the Registration Statement or the
Prospectus which in the opinion of the Representatives may thereby be made
necessary. The term "Underwriter" as used in this Agreement shall include any
person substituted under this Section with like effect as if such person had
originally been a party to the Pricing Agreement with respect to such Designated
Securities.
(b) If, after giving effect to any arrangements for the purchase of the
Firm Designated Securities or Optional Designated Securities, as the case may
be, of a defaulting Underwriter or Underwriters by the Representatives and the
Designated Trust and the Company as provided in subsection (a) above, the
aggregate number of such Designated Securities which remains unpurchased does
not exceed one-eleventh of the aggregate number of the Firm Designated
Securities or Optional Designated Securities, as the case may be, to be
purchased at the respective Time of Delivery, then the Designated Trust shall
have the right to require each non-defaulting Underwriter to purchase the number
of Firm Designated Securities or Optional Designated Securities, as the case may
be, which such Underwriter agreed to purchase under the Pricing Agreement
relating to such Designated Securities and, in addition, to require each non-
defaulting Underwriter to purchase its pro rata share (based on the number of
Firm Designated Securities or Optional Designated Securities, as the case may
be, which such
22
<PAGE>
Underwriter agreed to purchase under such Pricing Agreement) of the Firm
Designated Securities or Optional Designated Securities, as the case may be, of
such defaulting Underwriter or Underwriters for which such arrangements have not
been made; but nothing herein shall relieve a defaulting Underwriter from
liability for its default.
(c) If, after giving effect to any arrangements for the purchase of the
Firm Designated Securities or Optional Designated Securities, as the case may
be, of a defaulting Underwriter or Underwriters by the Representatives and the
Designated Trust and the Company as provided in subsection (a) above, the
aggregate number of Firm Designated Securities or Optional Designated
Securities, as the case may be, which remains unpurchased exceeds one-eleventh
of the aggregate number of the Firm Designated Securities or Optional Designated
Securities, as the case may be, to be purchased at the respective Time of
Delivery, as referred to in subsection (b) above, or if the Designated Trust and
the Company shall not exercise the right described in subsection (b) above to
require non-defaulting Underwriters to purchase Firm Designated Securities or
Optional Designated Securities, as the case may be, of a defaulting Underwriter
or Underwriters, then the Pricing Agreement relating to such Firm Designated
Securities or the Over-allotment Option relating to such Optional designated
Securities, as the case may be, shall thereupon terminate, without liability on
the part of any non-defaulting Underwriter or the Designated Trust or the
Company, except for the expenses to be borne by the Designated Trust and the
Company and the Underwriters as provided in Section 6 hereof and the indemnity
and contribution agreements in Section 8 hereof; but nothing herein shall
relieve a defaulting Underwriter from liability for its default.
10. The respective indemnities, agreements, representations, warranties
and other statements of the Designated Trust and the Company and the several
Underwriters, as set forth in this Agreement or made by or on behalf of them,
respectively, pursuant to this Agreement, shall remain in full force and effect,
regardless of any investigation (or any statement as to the results thereof)
made by or on behalf of any Underwriter or any controlling person of any
Underwriter, or the Designated Trust or the Company, or any officer or director
or controlling person of the Designated Trust or the Company, and shall survive
delivery of and payment for the Securities.
11. If any Pricing Agreement or Over-allotment Option shall be terminated
pursuant to Section 9 hereof, neither the Designated Trust nor the Company shall
then be under any liability to any Underwriter with respect to the Firm
Designated Securities or Optional Designated Securities with respect to which
such Pricing Agreement shall have been terminated except as provided in Sections
6 and 8 hereof; but, if for any other reason Designated Securities are not
delivered by or on behalf of the Designated Trust or the Company as provided
herein, the Company will reimburse the Underwriters through the Representatives
for all out-of-pocket expenses approved in writing by the Representatives,
including fees and disbursements of counsel, reasonably incurred by the
Underwriters in making preparations for the purchase, sale and delivery of such
Designated Securities, but the Designated Trust and the Company shall then be
under no further liability to any Underwriter with respect to such Designated
Securities except as provided in Sections 6 and 8 hereof.
23
<PAGE>
12. In all dealings hereunder, the Representatives of the Underwriters of
Designated Securities shall act on behalf of each of such Underwriters, and the
parties hereto shall be entitled to act and rely upon any statement, request,
notice or agreement on behalf of any Underwriter made or given by such
Representatives jointly or by such of the Representatives, if any, as may be
designated for such purpose in the Pricing Agreement.
All statements, requests, notices and agreements hereunder shall be in
writing, and if to the Underwriters shall be delivered or sent by mail, telex or
facsimile transmission to the address of the Representatives as set forth in the
Pricing Agreement; and if to the Designated Trust or the Company shall be
delivered or sent by mail, telex or facsimile transmission to the address of the
Company set forth in the Registration Statement, Attention: Secretary; provided,
however, that any notice to an Underwriter pursuant to Section 8(c) hereof shall
be delivered or sent by mail, telex or facsimile transmission to such
Underwriter at its address set forth in its Underwriters' Questionnaire, or
telex constituting such Questionnaire, which address will be supplied to the
Designated Trust and the Company by the Representatives upon request. Any such
statements, requests, notices or agreements shall take effect upon receipt
thereof.
13. This Agreement and each Pricing Agreement shall be binding upon, and
inure solely to the benefit of, the Underwriters, each Designated Trust, the
Company and, to the extent provided in Sections 8 and 10 hereof, the officers
and directors of each Designated Trust, the Company and each person who controls
any Designated Trust or the Company or any Underwriter, and their respective
heirs, executors, administrators, successors and assigns, and no other person
shall acquire or have any right under or by virtue of this Agreement or any such
Pricing Agreement. No purchaser of any of the Securities from any Underwriter
shall be deemed a successor or assign by reason merely of such purchase.
14. Time shall be of the essence of each Pricing Agreement. As used
herein, "business day" shall mean any day when the Commission's office in
Washington, D.C. is open for business.
15. This Agreement and each Pricing Agreement shall be governed by and
construed in accordance with the laws of the State of New York.
24
<PAGE>
16. This Agreement and each Pricing Agreement may be executed by any one
or more of the parties hereto and thereto in any number of counterparts, each of
which shall be deemed to be an original, but all such respective counterparts
shall together constitute one and the same instrument.
Very truly yours,
EDISON INTERNATIONAL
By:......................................
Name:
Title:
EIX TRUST I
By: Edison International, as Depositor
By:......................................
Name:
Title:
EIX TRUST II
By: Edison International, as Depositor
By:......................................
Name:
Title:
EIX TRUST III
By: Edison International, as Depositor
By:......................................
Name:
Title:
25
<PAGE>
ANNEX I
Pricing Agreement
-----------------
[Names of Representatives,]
As Representatives of the several
Underwriters named in Schedule I hereto
[Address]
____________, ____
Ladies and Gentlemen:
EIX Trust [I] [II] [III], a statutory business trust formed under the laws
of the State of Delaware (the "Designated Trust"), and Edison International, a
California corporation (the "Company"), propose, subject to the terms and
conditions stated herein and in the Underwriting Agreement, dated July [___],
1999 (the "Underwriting Agreement"), to issue and sell to the Underwriters named
in Schedule I hereto (the "Underwriters") the Securities specified in Schedule
II hereto (the "Designated Securities" consisting of Firm Designated Securities
and any Optional Designated Securities the Underwriters may elect to purchase).
The principal asset of the Designated Trust consists of debt securities of the
Company ("Subordinated Debentures"), as specified in Schedule II to this
Agreement. The Designated Securities will be guaranteed by the Company to the
extent set forth in this Agreement with respect to such Designated Securities
(the "Guarantee"). Each of the provisions of the Underwriting Agreement is
incorporated herein by reference in its entirety, and shall be deemed to be a
part of this Agreement to the same extent as if such provisions had been set
forth in full herein; and each of the representations and warranties set forth
therein shall be deemed to have been made at and as of the date of this Pricing
Agreement, except that each representation and warranty which refers to the
Prospectus in Section 2 of the Underwriting Agreement shall be deemed to be a
representation or warranty as of the date of the Underwriting Agreement in
relation to the Prospectus (as therein defined), and also a representation and
warranty as of the date of this Pricing Agreement in relation to the Prospectus
as amended or supplemented relating to the Designated Securities which are the
subject of this Pricing Agreement. Each reference to the Representatives herein
and in the provisions of the Underwriting Agreement so incorporated by reference
shall be deemed to refer to you. Unless otherwise defined herein, terms defined
in the Underwriting Agreement are used herein as therein defined. The
Representatives designated to act on behalf of the Representatives and on behalf
of each of the Underwriters of the Designated Securities pursuant to Section 12
of the Underwriting Agreement and the address of the Representatives referred to
in such Section 12 are set forth at the end of Schedule II hereto.
An amendment to the Registration Statement, or a supplement to the
Prospectus, as the case may be, relating to the Designated Securities, in the
form heretofore delivered to you is now proposed to be filed with the
Commission.
1
<PAGE>
Subject to the terms and conditions set forth herein and in the
Underwriting Agreement incorporated herein by reference, (a) the Designated
Trust agrees to issue and sell to each of the Underwriters, and each of the
Underwriters agrees, severally and not jointly, to purchase from the Designated
Trust, at the time and place and at the purchase price to the Underwriters set
forth in Schedule II hereto, the number of Firm Designated Securities set forth
opposite the name of such Underwriter in Schedule I hereto, and (b) in the event
and to the extent that the Underwriters shall exercise the election to purchase
Optional Designated Securities, as provided below, the Designated Trust agrees
to issue and sell to each of the Underwriters, and each of the Underwriters
agrees, severally and not jointly, to purchase from the Designated Trust at the
purchase price to the Underwriters set forth in Schedule II hereto that portion
of the number of Optional Designated Securities as to which such election shall
have been exercised.
The Designated Trust hereby grants to each of the Underwriters the right to
purchase at their election up to the number of Optional Designated Securities
set forth opposite the name of such Underwriter in Schedule I hereto on the
terms referred to in the paragraph above for the sole purpose of covering over-
allotments in the sale of the Firm Designated Securities. Any such election to
purchase Optional Designated Securities may be exercised by written notice from
the Representatives to the Designated Trust and the Company given within a
period of 30 calendar days after the date of this Pricing Agreement, setting
forth the aggregate number of Optional Designated Securities to be purchased and
the date on which such Optional Designated Securities are to be delivered, as
determined by the Representatives, but in no event earlier than the First Time
of Delivery or, unless the Representatives and the Company and the Designated
Trust otherwise agree in writing, no earlier than ten or later than ten business
days after the date of such notice.
2
<PAGE>
If the foregoing is in accordance with your understanding, please sign and
return to us [___] counterparts hereof, and upon acceptance hereof by you, on
behalf of each of the Underwriters, this letter and such acceptance hereof,
including the provisions of the Underwriting Agreement incorporated herein by
reference, shall constitute a binding agreement between each of the Underwriters
and the Designated Trust and the Company. It is understood that your acceptance
of this letter on behalf of each of the Underwriters is or will be pursuant to
the authority set forth in a form of Agreement among Underwriters, the form of
which shall be submitted to the Designated Trust and the Company for examination
upon request, but without warranty on the part of the Representatives as to the
authority of the signers thereof.
Very truly yours,
EDISON INTERNATIONAL
By:......................................
Name:
Title:
EIX TRUST [I] [II] [III]
By: Edison International, as Depositor
By:......................................
Name:
Title:
Accepted as of the date hereof:
[Names of Representatives]
By:...............................
3
<PAGE>
SCHEDULE I
<TABLE>
<CAPTION>
Number of Maximum Number
Firm Designated of Optional Designated
Securities Securities Which
Underwriter to be Purchased May be Purchased
- ----------- --------------- -----------------------
<S> <C> <C>
[Names of Representatives] ]..........
[Names of other Underwriters]..........
Total........................ ============== =======================
</TABLE>
4
<PAGE>
SCHEDULE II
Designated Trust:
EIX Trust [I] [II] [III]
Title of Designated Securities:
[____ % Cumulative Quarterly Income Preferred Securities, Series ___
(QUIPS(SM)] (Liquidation Amount $25 per Preferred Security)
Aggregate liquidation amount:
Firm Designated Securities: $_________________
Optional Designated Securities: [up to $_______________]
[none]
Price to public:
_____% of the liquidation amount of the Designated Securities
Purchase price to Underwriters:
_____% of the liquidation amount of the Designated Securities
Underwriters' compensation:
As compensation to the Underwriters for their commitments hereunder, and in
view of the fact that the proceeds of the sale of the Designated Securities
will be used by the Designated Trust to purchase the Subordinated
Debentures of the Company, the Company hereby agrees to pay at each Time of
Delivery to [the Representatives], for the accounts of the several
Underwriters, an amount equal to $ ___________ per Designated Security for
the Designated Securities to be delivered at each Time of Delivery.
Specified funds for payment of purchase price:
Federal (same day) Funds
Accountants' letter to be delivered on date of Pricing Agreement:
Yes
5
<PAGE>
Trust Agreement:
Amended and Restated Trust Agreement dated as of_______________, ____ among
the Company, as Depositor, The Chase Manhattan Bank, as Property Trustee,
Chase Manhattan Bank Delaware, as Delaware Trustee, the Regular Trustees
named therein and the several Holders of Trust Securities
Designated Guarantee:
Guarantee Agreement dated as of _____________, ____ between the Company and
The Chase Manhattan Bank, as Trustee
Designated Subordinated Debentures:
[$_____________ aggregate principal amount of ___% Subordinated Deferrable
Interest Notes, Series ___, due _______________]
Maturity:
______________, _____ [(subject to (i) extension to a date not later than
____________, _____ and (ii) shortening to a date not earlier than
______________, _____)]
Interest rate:
_____%
Interest payment dates:
______________________ of each year, commencing on __________, _____
Extension period:
[_______ quarters] [________ semi-annual periods]
Redemption provisions:
[Set forth in Section ____ of the Trust Agreement]
Sinking fund provisions:
No sinking fund provisions
6
<PAGE>
Exchange for Designated Securities:
[The Subordinated Debentures may be delivered in exchange for the
Designated Securities as provided in the Trust Agreement]
Time of Delivery:
________ a.m., New York City time
___________, _____
Closing location for delivery of Designated Securities:
Names and addresses of Representatives:
[Representatives]
[Address for Notices]
7
<PAGE>
ANNEX II
Pursuant to Section 7(f) of the Underwriting Agreement, the accountants
shall furnish letters to the Underwriters to the effect that:
(i) They are independent certified public accountants with respect
to the Designated Trust and the Company and its subsidiaries within the
meaning of the Act and the applicable rules and regulations adopted by the
Commission;
(ii) In their opinion, the financial statements and any
supplementary financial information and schedules (and, if applicable,
financial forecasts and/or pro forma financial information) audited or
examined by them and included or incorporated by reference in the
Registration Statement or the Prospectus comply as to form in all material
respects with the applicable accounting requirements of the Act or the
Exchange Act, as applicable, and the related rules and regulations; and, if
applicable, they have made a review in accordance with standards
established by the American Institute of Certified Public Accountants of
the consolidated interim financial statements, selected financial data, pro
forma financial information, financial forecasts and/or condensed financial
statements derived from audited financial statements of the Company for the
periods specified in such letter, as indicated in their reports thereon,
copies of which [have been separately furnished to the representative or
representatives of the Underwriters (the "Representatives")] [are attached
to such letters];
(iii) They have made a review in accordance with standards
established by the American Institute of Certified Public Accountants of
the unaudited condensed consolidated statements of income, consolidated
balance sheets and consolidated statements of cash flows included in the
Prospectus and/or included in the Company's Quarterly Reports on Form 10-Q
incorporated by reference into the Prospectus, as indicated in their
reports thereon, copies of which [have been separately furnished to the
Representatives][are attached to such letters]; and on the basis of
specified procedures including inquiries of officials of the Company who
have responsibility for financial and accounting matters regarding whether
the unaudited condensed consolidated financial statements referred to in
paragraph (vi)(A)(i) below comply as to form in all material respects with
the applicable accounting requirements of the Act and the Exchange Act and
the related rules and regulations, nothing came to their attention that
caused them to believe that the unaudited condensed consolidated financial
statements do not comply as to form in all material respects with the
applicable accounting requirements of the Act and the Exchange Act and the
related rules and regulations adopted by the Commission;
(iv) The unaudited selected financial information with respect to
the consolidated results of operations and financial position of the
Company for the five most recent fiscal years included in the Prospectus
and included or incorporated by reference in Item 6 of the Company's Annual
Report on Form 10-K for the most recent fiscal year agrees with the
corresponding amounts (after restatement where applicable) in the audited
consolidated financial statements for five such fiscal years included or
incorporated by reference in the Company's Annual Reports on Form 10-K for
such fiscal years;
1
<PAGE>
(v) They have compared the information in the Prospectus under
selected captions with the disclosure requirements of Regulation S-K and on
the basis of limited procedures specified in such letter nothing came to
their attention as a result of the foregoing procedures that caused them to
believe that this information does not conform in all material respects
with the disclosure requirements of Items 301, 302, 402 and 503(d),
respectively, of Regulation S-K;
(vi) On the basis of limited procedures, not constituting an
examination in accordance with generally accepted auditing standards,
consisting of a reading of the unaudited financial statements and other
information referred to below, a reading of the latest available interim
financial statements of the Company and its subsidiaries, inspection of the
minute books of the Company and its subsidiaries since the date of the
latest audited financial statements included or incorporated by reference
in the Prospectus, inquiries of officials of the Company and its
subsidiaries responsible for financial and accounting matters and such
other inquiries and procedures as may be specified in such letter, nothing
came to their attention that caused them to believe that:
(A) (i) the unaudited condensed consolidated statements of
income, consolidated balance sheets and consolidated statements of
cash flows included in the Prospectus and/or included or incorporated
by reference in the Company's Quarterly Reports on Form 10-Q
incorporated by reference in the Prospectus do not comply as to form
in all material respects with the applicable accounting requirements
of the Exchange Act and the published rules and regulations adopted by
the Commission, or (ii) any material modifications should be made to
the unaudited condensed consolidated statements of income,
consolidated balance sheets and consolidated statements of cash flows
included in the Prospectus or included in the Company's Quarterly
Reports on Form 10-Q incorporated by reference in the Prospectus for
them to be in conformity with generally accepted accounting
principles;
(B) any other unaudited income statement data and balance sheet
items included in the Prospectus do not agree with the corresponding
items in the unaudited consolidated financial statements from which
such data and items were derived, and any such unaudited data and
items were not determined on a basis substantially consistent with the
basis for the corresponding amounts in the audited consolidated
financial statements included or incorporated by reference in the
Company's Annual Report on Form 10-K for the most recent fiscal year;
(C) the unaudited financial statements which were not included
in the Prospectus but from which were derived the unaudited condensed
financial statements referred to in clause (A) and any unaudited
income statement data and balance sheet items included in the
Prospectus and referred to in clause (B) were not determined on a
basis substantially consistent with the basis for the audited
financial statements included or incorporated by reference in the
Company's Annual Report on Form 10-K for the most recent fiscal year;
2
<PAGE>
(D) any unaudited pro forma consolidated condensed financial
statements included or incorporated by reference in the Prospectus do
not comply as to form in all material respects with the applicable
accounting requirements of the Act and the rules and regulations
adopted by the Commission thereunder or the pro forma adjustments have
not been properly applied to the historical amounts in the compilation
of those statements;
(E) as of a specified date not more than five days prior to the
date of such letter, there have been any changes in the consolidated
capital stock (other than issuances of capital stock upon exercise of
options and stock appreciation rights, upon earn-outs of performance
shares and upon conversions of convertible securities, in each case
which were outstanding on the date of the latest balance sheet
included or incorporated by reference in the Prospectus) or any
increase in the consolidated long-term debt of the Company and its
subsidiaries, or any decreases in consolidated net current assets or
stockholders' equity or other items specified by the Representatives,
or any increases in any items specified by the Representatives, in
each case as compared with amounts shown in the latest balance sheet
included or incorporated by reference in the Prospectus, except in
each case for changes, increases or decreases which the Prospectus
discloses have occurred or may occur or which are described in such
letter; and
(F) for the period from the date of the latest financial
statements included or incorporated by reference in the Prospectus to
the specified date referred to in clause (E) there were any decreases
in consolidated net revenues or operating profit or the total or per
share amounts of consolidated net income or other items specified by
the Representatives, or any increases in any items specified by the
Representatives, in each case as compared with the comparable period
of the preceding year and with any other period of corresponding
length specified by the Representatives, except in each case for
increases or decreases which the Prospectus discloses have occurred or
may occur or which are described in such letter; and
(vii) In addition to the audit referred to in their report(s)
included or incorporated by reference in the Prospectus and the limited
procedures, inspection of minute books, inquiries and other procedures
referred to in paragraphs (iii) and (vi) above, they have carried out
certain specified procedures, not constituting an audit in accordance with
generally accepted auditing standards, with respect to certain amounts,
percentages and financial information specified by the Representatives
which are derived from the general accounting records of the Company and
its subsidiaries, which appear in the Prospectus (excluding documents
incorporated by reference), or in Part II of, or in exhibits and schedules
to, the Registration Statement specified by the Representatives or in
documents incorporated by reference in the Prospectus specified by the
Representatives, and have compared certain of such amounts, percentages and
financial information with the accounting records of the Company and its
subsidiaries and have found them to be in agreement.
3
<PAGE>
All references in this Annex II to the Prospectus shall be deemed to refer
to the Prospectus (including the documents incorporated by reference therein) as
defined in the Underwriting Agreement as of the date of the letter delivered on
the date of the Pricing Agreement for purposes of such letter and to the
Prospectus as amended or supplemented (including the documents incorporated by
reference therein) in relation to the applicable Designated Securities for
purposes of the letter delivered at each Time of Delivery for such Designated
Securities.
4
<PAGE>
ANNEX III
1
<PAGE>
[EDISON INTERNATIONAL LETTERHEAD]
July ____, 1999
To the Representatives named on
Exhibit A hereto of the Underwriters
named on Exhibit B hereto
Re: Issuance of $500,000,000 Aggregate Liquidation Amount of
Cumulative Quarterly Income Preferred Securities, Series A
----------------------------------------------------------
Ladies and Gentlemen:
This opinion is rendered to you in compliance with the provisions of
subsection (c) of Section 7 of the Underwriting Agreement dated as of July ___,
1999 among Edison International (the "Company"), EIX Trust I ("Trust I"), EIX
------- -------
Trust II and EIX Trust III, each a statutory business trust formed under the
laws of the State of Delaware (each a "Trust," and collectively, the "Trusts")
----- ------
and the Representatives (the "Representatives") of the several Underwriters
---------------
named in the pricing agreements hereinafter described (the "Underwriting
------------
Agreement") and the Pricing Agreement dated as of July ___, 1999 (the "Pricing
- --------- -------
Agreement") among the Company, Trust I and the Representatives. The
- ---------
Underwriting Agreement and the Pricing Agreement provide for the sale to you of
$500,000,000 aggregate principal amount of ___% Cumulative Quarterly Income
Preferred Securities, Series A, issued by Trust I (the "QUIPS"). The QUIPS
-----
represent undivided beneficial interests in the assets of Trust I, which
generally comprise a corresponding principal amount of ___% Subordinated
Deferrable Interest Notes, Series A (the "QUIDS") issued by the Company, under a
-----
Subordinated Indenture, as amended (the "Indenture"), entered into by and
---------
between the Company and The Chase Manhattan Bank, as trustee (the "Trustee").
-------
The QUIPS and QUIDS have been registered under the Securities Act of 1933, as
amended (the "Act"), on a Registration Statement on Form S-3 filed with the
---
Securities and Exchange Commission (the "Commission") on July 2, 1999 (File No.
----------
333-82293), as amended by Amendment No. 1 filed with the Commission on July 13,
1999 and Amendment No. 2 filed with the Commission on July ___, 1999 (as so
amended, including the documents incorporated by reference therein, the
"Registration Statement"). The QUIDS and QUIPS are to be sold as described in
- -----------------------
the Registration Statement and the prospectus and prospectus supplement relating
to the QUIDS and QUIPS. Capitalized terms used herein without definition have
the meanings ascribed to them in the Underwriting Agreement, and, in the case of
terms not used in the Underwriting Agreement, the meanings ascribed to them in
the Indenture.
<PAGE>
Representatives Named on Exhibit A
July __, 1999
Page 2
I am the Assistant General Counsel and Assistant Secretary of the
Company. In rendering the opinions expressed below, I or attorneys acting under
my supervision have (a) examined and relied on originals, or copies certified or
otherwise identified as true copies of the originals, of such records,
documents, certificates and other instruments, (b) made such investigations of
law as I have deemed appropriate to enable me to give the opinions expressed
below and (c) relied upon appropriate certificates of public officials, officers
or employees of the Company and other persons, as to factual matters. I believe
that both you and I are justified in relying upon such certificates.
I am opining herein as to the effect on the subject transactions only
of the federal laws of the United States and the internal laws of the State of
California, and I express no opinion with respect to the applicability thereto,
or the effect thereon, of the laws of any other jurisdiction, or as to any
matters of municipal law or the laws of any local agencies within any state.
I am familiar with and have examined the Registration Statement,
including the prospectus dated July ___, 1999 (the "Prospectus") and the
----------
prospectus supplement dated July ___, 1999 (the "Prospectus Supplement," and
---------------------
together with the Prospectus, the "Final Prospectus"), which Prospectus and
----------------
Prospectus Supplement incorporate by reference certain documents filed with the
Commission.
Based on the foregoing, it is my opinion that, as of the date hereof:
1. Each of the Company, Southern California Edison Company, a
California corporation, Edison Mission Energy, a California corporation, and
Edison Capital, a California corporation, has been duly incorporated and is
validly existing and in good standing under the laws of the state of its
incorporation, with corporate power and authority to own, lease and operate its
properties and to conduct its business as described in the Registration
Statement and the Final Prospectus.
2. The Company has an authorized capitalization as set forth in the
Final Prospectus and all of the issued shares of capital stock of the Company
have been duly and validly authorized and issued and are fully paid and non-
assessable.
3. To the best of my knowledge, there is no pending or threatened
action, suit or proceeding before any court or governmental agency, authority or
body or any arbitrator involving the Company or any of its subsidiaries
(including Trust I) of a character required to be disclosed in the Registration
Statement which is not adequately disclosed in the Final Prospectus.
4. Each of the Underwriting Agreement and the Pricing Agreement has
been duly authorized, executed and delivered by Trust I and the Company.
5. Each of the Trust Agreement, the Indenture, the Designated Expense
Agreement and the Designated Guarantee has been duly authorized, executed and
delivered by
<PAGE>
Representatives Named on Exhibit A
July __, 1999
Page 3
the Company, and each of the Indenture, the Designated Expense Agreement and the
Designated Guarantee constitutes a legally valid and binding obligation of the
Company, enforceable against the Company in accordance with its terms.
6. Each of the Trust Agreement, the Indenture and the Designated
Guarantee has been duly qualified under the Trust Indenture Act.
7. The QUIDS have been duly authorized, executed, issued and
delivered by the Company and constitute the legally valid and binding obligation
of the Company, enforceable against the Company in accordance with its terms,
and are entitled to the benefits provided by the Indenture.
8. The issuance by the Company of the Designated Guarantee and the
QUIDS, the issuance and sale by Trust I of the QUIPS, the compliance by the
Company with the provisions of the Underwriting Agreement, the Pricing Agreement
and the Company Agreements, the compliance by Trust I with the provisions of the
Underwriting Agreement, the Pricing Agreement and the Designated Securities and
the consummation of the transactions herein and therein contemplated will not:
(a) to the best of my knowledge violate any statute or any order, rule or
regulation of any court or governmental agency or body having jurisdiction over
the Company or any of its properties or Trust I, (b) violate provisions of the
Articles of Incorporation or By-laws of the Company, (c) result in the breach of
or a default under any material indenture, mortgage, deed of trust, loan
agreement or other agreement or instrument known to me to which the Company or
any of its subsidiaries is a party or by which the Company or any of its
subsidiaries is bound or to which any of the material property or assets of the
Company or any of its subsidiaries is subject, or (d) require any consents,
approvals, authorizations, registrations, declarations or filings by the
Company, except (i) such as have been obtained under the Act and the Trust
Indenture Act and (ii) such as may be required under state securities or Blue
Sky laws in connection with the purchase and distribution of the QUIPS by the
Underwriters or the issuance of the Designated Guarantee and QUIDS by the
Company.
9. The statements set forth in (i) the Prospectus under the captions
"Description of Securities," "Description of Debt Securities," Description of
Preferred Securities," "Description of Preferred Securities Guarantees,"
"Description of Expense Agreements" and "Relationship Among Preferred
Securities, Preferred Securities Guarantees and Subordinated Debt Securities
Held by Each Trust" and (ii) in the Final Prospectus under the captions
"Description of Series A QUIDS" and "Description of Series A QUIPS," insofar as
they constitute a summary of the terms of the QUIPS, the Trust Agreement, the
QUIDS, the Indenture, the Designated Guarantee and the Designated Expense
Agreement and (y) in the Prospectus under the caption "Plan of Distribution" and
(z) in the Final Prospectus under the caption "Underwriting," insofar as they
purport to describe the provisions of the laws and documents referred to
therein, in each case are accurate and complete in all material respects. To
the best of my knowledge, there are no statutes or legal or governmental
proceedings required to be described in the Final Prospectus that are not
described as required, or contracts of documents of a character required to be
described in the Registration Statement or Prospectus (or required to
<PAGE>
Representatives Named on Exhibit A
July __, 1999
Page 4
be filed under the Exchange Act, if upon such filing they would be incorporated
by reference therein) or to be filed as exhibits to the Registration Statement
that are not described and filed as required.
10. The Registration Statement and the Final Prospectus comply as to
form in all material respects with the requirements for registration statements
on Form S-3 under the Act and the requirements under the Trust Indenture Act and
the rules and regulations of the Commission thereunder; it being understood,
however, that I express no opinion with respect to the financial statements,
schedules or other financial data included or incorporated by reference in, or
omitted from, the Registration Statement or the Final Prospectus or with respect
to the Form T-1's. In passing upon the compliance as to form of the
Registration Statement and the Final Prospectus, I have assumed that the
statements made and incorporated by reference therein are correct and complete.
11. Neither the Company nor Trust I is an "investment company" or an
entity "controlled" by an "investment company," as such terms are defined in the
Investment Company Act.
In addition, I have participated in conferences with officers and
other representatives of the Company, representatives of the independent public
accountants for the Company, and your representatives, at which the contents of
the Registration Statement and the Final Prospectus and related matters were
discussed and, although I am not passing upon, and do not assume any
responsibility for, the accuracy, completeness or fairness of the statements
contained or incorporated by reference in the Registration Statement and the
Final Prospectus and have not made any independent check or verification
thereof, during the course of such participation, no facts came to my attention
that caused me to believe that the Registration Statement, at the time it became
effective, contained an untrue statement of a material fact or omitted to state
a material fact required to be stated therein or necessary to make the
statements therein not misleading, or that the Final Prospectus (including the
documents incorporated by reference), as of its date or as of the date hereof,
contained or contains an untrue statement of a material fact or omitted or omits
to state a material fact necessary to make the statements therein, in light of
the circumstances under which they were made, not misleading; it being
understood that I express no belief with respect to the financial statements,
schedules and other financial data included or incorporated by reference in, or
omitted from, the Registration Statement or the Final Prospectus or with respect
to the Form T-1's.
The opinions rendered in paragraphs 5 and 7, relating to the
enforceability of the Indenture, the Designated Expense Agreement, the
Designated Guarantee and the QUIDS, respectively, are subject to the following
exceptions, limitations and qualifications: (i) the effect of bankruptcy,
insolvency, reorganization, moratorium or other similar laws relating to or
affecting the rights and remedies of creditors generally; (ii) the effect of
general principles of equity, including without limitation concepts of
materiality, reasonableness, good faith and fair dealing and possible
unavailability of specific performance or injunctive relief, regardless of
whether considered in a proceeding in equity or at law; (iii) certain rights,
remedies and waivers
<PAGE>
Representatives Named on Exhibit A
July __, 1999
Page 5
contained in the Indenture, the Designated Expense Agreement, the Designated
Guarantee and the QUIDS may be limited or rendered ineffective by applicable
California laws or judicial decisions governing such provisions, but such laws
or judicial decisions do not render the Indenture, the Designated Expense
Agreement, the Designated Guarantee and the QUIDS invalid or unenforceable as a
whole; (iv) the unenforceability under certain circumstances under law or court
decisions of provisions providing for the indemnification of or contribution to
a party with respect to a liability where such indemnification or contribution
is contrary to public policy; (v) I express no opinion concerning the
enforceability of the waiver of rights or defenses contained in the Indenture;
(vi) the unenforceability under certain circumstances, under California or
federal law or court decisions, of provisions expressly or by implication
waiving broadly or vaguely stated rights, unknown future rights, defenses to
obligations or rights granted by law, where such waivers are against public
policy or prohibited by law; (vii) the unenforceability under certain
circumstances of provisions to the effect that rights or remedies are not
exclusive, that every right or remedy is cumulative and may be exercised in
addition to or with any other right or remedy, that election of a particular
remedy or remedies does not preclude recourse to one or more other remedies,
that any right or remedy may be exercised without notice, or that failure to
exercise or delay in exercising rights or remedies will not operate as a waiver
of any such right or remedy; and (viii) the effect of California law, which
provides that a court may refuse to enforce, or may limit the application of, a
contract or any clause thereof which the court finds as a matter of law to have
been unconscionable at the time it was made or contrary to public policy.
To the extent that the obligations of the Company under the Company
Agreements may be dependent upon such matters, I assume for purposes of this
opinion that the parties to each of the Company Agreements (other than the
Company) is duly organized, validly existing and in good standing under the laws
of its jurisdiction of organization; that each of the Trustee, the Property
Trustee, the Delaware Trustee and the Guarantee Trustee is duly qualified to
engage in the activities contemplated by the Company Agreement to which it is a
party; that each of the Company Agreements has been duly authorized, executed
and delivered by the parties thereto (other than the Company) and constitutes a
legally valid and binding obligation of the parties thereto (other than the
Company) enforceable against such parties in accordance with its terms; and each
of the parties (other than the Company) to the Company Agreements is in
compliance generally under the Company Agreement to which it is a party and with
all applicable laws and regulations; and that each party to each of the Company
Agreements (other than the Company) has the requisite organizational and legal
power and authority to perform its obligations under the Company Agreements to
which it is a party.
This opinion is rendered only to you as Representatives of the several
Underwriters under the Underwriting Agreement and the Pricing Agreement and is
solely for the benefit of the Underwriters in connection with the transactions
covered hereby. This opinion may not be relied upon by you for any other
purpose, or furnished to, quoted to, or relied upon by any other person, firm or
corporation for any purpose, without my prior written consent.
Very truly yours,
Kenneth S. Stewart
<PAGE>
EXHIBIT A
Representatives
---------------
Goldman, Sachs & Co.
A.G. Edwards & Sons, Inc.
Lehman Brothers Inc.
Merrill Lynch, Pierce, Fenner & Smith Incorporated
Morgan Stanley & Co. Incorporated
PaineWebber Incorporated
Prudential Securities Incorporated
Salomon Smith Barney Inc.
A-1
<PAGE>
EXHIBIT B
Underwriters
------------
Goldman, Sachs & Co.
A.G. Edwards & Sons, Inc.
Lehman Brothers Inc.
Merrill Lynch, Pierce, Fenner & Smith Incorporated
Morgan Stanley & Co. Incorporated
PaineWebber Incorporated
Prudential Securities Incorporated
Salomon Smith Barney Inc.
[INSERT OTHER UNDERWRITERS]
B-1
