Joint Proxy Statement
PROXY STATEMENT PURSUANT TO SECTION 14(a) OF THE SECURITIES
EXCHANGE ACT OF 1934 (Amendment No. )
Filed by the Registrant X
Filed by a Party Other than the Registrant __
Check the appropriate box:
___ Preliminary Proxy Statement
X Definitive Proxy Statement
----
___ Definitive Additional Materials
___ Soliciting Material Pursuant to Section 240.14a-11(c) or Section 240.14a-12
EDISON INTERNATIONAL
-------------------------------------------------------------------------------
(Name of Registrant as Specified in its Charter)
KENNETH S. STEWART
-------------------------------------------------------------------------------
(Name of Person(s) Filing Proxy Statement)
Payment of Filing Fee (Check the appropriate box):
___ $125 per Exchange Act Rules 0-11(c)(1)(ii), 14a-6(i)(l), or 14a-6(j)(2)
___ $500 per each party to the controversy pursuant to Exchange Act
Rule 14a-6(i)(3)
___ Fee computed on table below per Exchange Act rules 14a-6(I)(4) and 0-11.
(1) Title of each class of securities to which transaction applies:
---------------------------------------------------------------------------------
(2) Aggregate number of securities to which transaction applies:
---------------------------------------------------------------------------------
(3) Per unit price or other underlying value of transaction computed pursuant to
Exchange Act Rule 0-11:
---------------------------------------------------------------------------------
(4) Proposed maximum aggregate value of transaction:
---------------------------------------------------------------------------------
Set forth the amount on which the filing fee is calculated and state how it is
determined.
___ Check box if any part of the fee is offset as provided by Exchange Act
Rule 0-11(a)(2) and identify the filing for which the offsetting fee
was paid previously. Identify the previous filing by registration
statement number, or the Form or Schedule and the date of its filing.
(1)Amount Previously Paid:
--------------------------------------------------------------------------
(2)Form, Schedule or Registration Statement No.:
--------------------------------------------------------------------------
(3)Filing Party:
--------------------------------------------------------------------------
(4 Date Filed:
--------------------------------------------------------------------------
JOINT NOTICE OF ANNUAL MEETINGS OF SHAREHOLDERS
AND
JOINT PROXY STATEMENT
ANNUAL MEETINGS
May 14, 2002
EDISON INTERNATIONAL SOUTHERN CALIFORNIA EDISON COMPANY
[GRAPHIC OMITTED] [GRAPHIC OMITTED]
April 4, 2002
Dear Shareholder:
You are invited to attend the Edison International and Southern California Edison Company ("SCE") Annual
Meetings of Shareholders. The meetings will be held jointly on Tuesday, May 14, 2002, at the DoubleTree Hotel
Ontario, 222 N. Vineyard Avenue, Ontario, California, at 10:00 a.m., Pacific Time.
Your voting instructions are enclosed, and the applicable 2001 Annual Report and Joint Proxy Statement
are enclosed or are being delivered to you electronically. The Joint Proxy Statement discusses the matters to be
considered at the annual meetings. At the meetings, we will report on the Companies' activities, and
shareholders of Edison International and SCE will elect Directors who will oversee Company affairs until the next
annual meetings.
Whether or not you expect to attend the annual meetings, it is important that your shares be
represented. If you hold shares in both Edison International and SCE, you will receive a proxy or voting
instruction card for each Company. We are pleased to offer certain shareholders the option to vote shares by
telephone or the Internet as well as by mail. Voting by any of these methods, if available, will ensure that you
are represented at the Annual Meetings even if you are not present. Please review the instructions on the proxy
card regarding these options. If you hold your shares in an account with a broker or other nominee, you will
receive separate instructions from that nominee which may also allow telephone and Internet voting.
Your continued interest in the business of Edison International and SCE is appreciated.
Sincerely,
/s/ John E. Bryson /s/ Alan J. Fohrer
John E. Bryson Alan J. Fohrer
Chairman of the Board, President Chairman of the Board
and Chief Executive Officer and Chief Executive Officer
Edison International Southern California Edison Company
----------------------------------------------------------------------------------------------------------------
EDISON INTERNATIONAL SOUTHERN CALIFORNIA EDISON COMPANY
[GRAPHIC OMITTED] [GRAPHIC OMITTED]
===============================================================
JOINT NOTICE OF ANNUAL MEETINGS
OF SHAREHOLDERS
===============================================================
Date: Tuesday, May 14, 2002
Time: 10:00 a.m., Pacific Time
Place: DoubleTree Hotel Ontario
222 N. Vineyard Avenue
Ontario, California 91764
Matters to be voted upon by Edison International and Southern California Edison Company ("SCE") shareholders:
o Election of 11 Directors, respectively - The names of the Director nominees are:
John E. Bryson* Ronald L. Olson
Alan J. Fohrer** James M. Rosser
Bradford M. Freeman Richard T. Schlosberg, III
Joan C. Hanley Robert H. Smith
Bruce Karatz Thomas C. Sutton
Luis G. Nogales Daniel M. Tellep
* John E. Bryson is a Director nominee for the
Edison International Board only.
** Alan J. Fohrer is a Director nominee for the
SCE Board only.
o Any other business that may properly come before the meetings.
Your Board of Directors and Management recommend that you vote "FOR" the nominees for Directors listed in
the Joint Proxy Statement.
Record Date: Shareholders of record at the close of business on March 15, 2002, and valid
proxyholders for those shareholders, are entitled to vote at the annual meetings.
Voting Instructions: To vote by mail, you may complete, sign, date and return the enclosed proxy card in
the envelope provided. If you hold shares in your own name, or through the Edison
International Dividend Reinvestment and Stock Purchase Plan or the SCE Stock Savings
Plus Plan, you may vote by telephone or via the Internet by following the
instructions on your proxy card. There is a special number assigned to you on the
proxy card to safeguard your vote. Voting by telephone and via the Internet is
available 24 hours a day, seven days a week, through midnight, May 13, 2002, except
for Stock Savings Plus Plan shareholders who must vote by 5:00 p.m., Eastern Time,
on May 9, 2002. If you hold your shares in an account with a broker or other
nominee, you will receive separate instructions from that nominee which may also
allow telephone and Internet voting.
Electronic Access: Beginning with this annual meeting, Edison International is electronically
delivering its Proxy Statements and Annual Reports for annual and special
shareholders' meetings to certain employee-shareholders. If you hold Edison
International shares through the SCE Stock Savings Plus Plan, and you use company
E-mail in the ordinary course of performing your job and are expected to log-on to
E-mail routinely to receive mail and communications, we will deliver these documents
to you electronically for every shareholders' meeting. This will save Edison
International the cost of producing and mailing these documents. The Edison
International and SCE Joint Proxy Statement for the annual meetings, and the
respective 2001 Annual Reports are available on Edison International's Internet site
at http://www.edisoninvestor.com. If these documents are being delivered to you
electronically, you may also request paper copies through the date of the annual
meetings by contacting Edison International, c/o SCE Law Department, Corporate
Governance, 2244 Walnut Grove Avenue, P. O. Box 800, Rosemead, California 91770 or
at 626-302-2662; and after the annual meetings by contacting Edison International,
Investor Relations, 2244 Walnut Grove Avenue, P. O. Box 999, Rosemead, California
91770 or at 626-302-1937.
Meeting Admission: The following individuals will be admitted to the meetings:
o Shareholders of record on the record date, and their spouses;
o Individuals holding written proxies executed by shareholders of record on the record date;
o Shareholders who provide a letter or account statement from their broker or other nominee showing that
they owned stock held in the name of the broker or other nominee on the record date, and their
spouses; and
o Other individuals with the approval of the Edison International or SCE Secretary.
Shareholders which are companies or other entities are limited to three authorized representatives at the
meetings. Cameras, recording devices and other electronic devices will not be permitted at the meetings.
Dated: April 4, 2002
For the Boards of Directors,
/s/ BEVERLY P. RYDER
BEVERLY P. RYDER, Vice President
and Secretary, Edison International,
Secretary, Southern California Edison Company
IMPORTANT
In order to assure a quorum of shareholders at the annual meetings, please complete, sign, date and
mail the enclosed card promptly; or (if available to you) give your instructions by telephone or the Internet
as described on the enclosed card. If you mail the enclosed card, please sign (do not print) your name
exactly as it appears on the card. When signing as attorney, executor, administrator, trustee or guardian,
include your full title. Please have an authorized officer whose title is indicated sign for corporations,
charitable institutions and governmental units. For partnerships, have a partner sign and indicate
partnership status.
TABLE OF CONTENTS
Introduction - Solicitation of Proxies.........................................................................1
Questions and Answers on Voting, Proxies, and Attendance.......................................................2
Householding of Proxy Statements and Annual Reports............................................................6
Electronic Access to Proxy Statements and Annual Reports.......................................................6
Election of Directors, Nominees for Election...................................................................7
Board Committees...............................................................................................9
Board Meetings and Attendance.................................................................................12
Board Compensation............................................................................................12
Stock Ownership of Directors and Executive Officers...........................................................14
Section 16(a) Beneficial Ownership Reporting Compliance.......................................................16
Stock Ownership of Certain Shareholders.......................................................................17
Executive Compensation........................................................................................19
Summary Compensation Table...............................................................................19
Aggregated Option/SAR Exercises in 2001 and FY-End Option/SAR Values.....................................21
Long-Term Incentive Plan Awards in Last Fiscal Year......................................................24
Pension Plan Table.......................................................................................26
Other Retirement Benefits................................................................................27
Employment Contracts and Termination of Employment Arrangements..........................................28
Compensation and Executive Personnel Committees' Report on Executive Compensation.............................29
Compensation and Executive Personnel Committees' Interlocks and Insider Participation.........................34
Certain Relationships and Transactions........................................................................34
Other Management Transactions.................................................................................35
Certain Legal Proceedings.....................................................................................35
Five-Year Stock Performance Graph.............................................................................36
Audit Committees' Report......................................................................................38
Independent Public Accountant Fees............................................................................39
Independent Public Accountants for 2002.......................................................................39
Shareholder Proposals and Nominations for 2003 Annual Meetings................................................39
Availability of Form 10-K and Other Information...............................................................40
Other Proposed Matters........................................................................................40
Appendix A: Southern California Edison Company Charter for the Audit Committee of the
Board of Directors..........................................................................A-1
EDISON INTERNATIONAL
SOUTHERN CALIFORNIA EDISON COMPANY
2244 WALNUT GROVE AVENUE
P. O. BOX 800
ROSEMEAD, CALIFORNIA 91770
======================================================================
JOINT PROXY STATEMENT
======================================================================
INTRODUCTION - SOLICITATION OF PROXIES
This Joint Proxy Statement, proxy forms, voting instructions and the 2001 Annual Reports are being
distributed together beginning April 4, 2002, to the Edison International and Southern California Edison Company
shareholders for their annual meetings. The annual meetings will be held jointly on Tuesday, May 14, 2002, at
the DoubleTree Hotel Ontario, 222 N. Vineyard Avenue, Ontario, California, at 10:00 a.m., Pacific Time. The
Edison International and Southern California Edison Company Boards of Directors are soliciting proxies from you
for use at their annual meetings, or at any adjournment or postponement of the meetings. Proxies allow properly
designated individuals to vote on your behalf at an annual meeting. This Proxy Statement discusses the matters
to be voted on at the annual meetings.
In this Proxy Statement:
o "Annual meeting" means the Edison International annual meeting of shareholders and the Southern
California Edison Company annual meeting of shareholders, which are being held jointly.
o "SCE" means Southern California Edison Company.
o "DRP" means the Edison International shareholder plan known as the Dividend Reinvestment and Stock
Purchase Plan.
o "SSPP" means the SCE employee benefit plan known as the Stock Savings Plus Plan through which
participants may hold Edison International shares.
o Holding shares in "street name" means your shares are held in an account through your broker, bank,
fiduciary, custodian or other nominee, and you are considered the beneficial owner of those shares.
Your name does not appear on the Companies' records as a shareholder.
o Holding shares as a "registered" shareholder or "of record" means your shares are registered in your own
name directly with the Companies rather than in street name, and that stock certificates are issued in
your own name. Shares held in your DRP plan account are also included.
Page 1
QUESTIONS AND ANSWERS ON VOTING, PROXIES, AND ATTENDANCE
Q: What am I voting on?
A: You are voting on the election of 11 Directors for Edison International and for SCE, respectively, and any
other matters properly brought before the meetings. The election of Directors is Item 1 on the proxy card.
Q. Who can vote?
A. All registered shareholders at the close of business on March 15, 2002, are entitled to vote at the
meeting. Holders of Edison International's Common Stock are entitled to one vote per share on each item of
Edison International business. On each item of SCE business, holders of SCE Cumulative Preferred Stock are
entitled to six votes per share; holders of SCE $100 Cumulative Preferred Stock are entitled to two votes
per share; and holders of SCE Common Stock are entitled to one vote per share. Shareholders who hold shares
that are not registered in their own name may only vote their shares by giving voting instructions to the
registered shareholders. Shares held by participants in the SSPP are registered in the name of the plan
trustee and will be voted in its capacity as the stock fund investment manager. Fractional shares, such as
those held in the SSPP and in the DRP, may not be voted. All shares of SCE Common and Preferred Stocks vote
together as one class.
Q: Who can attend the meeting?
A: All shareholders on the record date, or their duly appointed proxies, may attend the meeting. Shareholders'
spouses are also welcome. Seating, however, is limited. All shareholders will be required to pass through
a security inspection area, and they must check in at the registration desk at the meeting. The
registration desk will open at 8:00 a.m., Pacific Time. If you are a registered or SSPP shareholder, an
admission pass is included with these materials, and you will present your pass at the registration desk for
admission. If you do not have an admission pass and you are a registered shareholder, we will be able to
verify your share ownership from the share register upon presentation of proper identification. If your
shares are not registered in your name, you will need to bring a letter or an account statement from your
broker, plan trustee or other nominee reflecting your stock ownership as of the record date and to provide
proper identification. A shareholder which is a corporation, partnership, association or other entity is
limited to three authorized representatives at the annual meeting. Cameras, recording devices and other
electronic devices will not be permitted at the meeting.
Q: How do I vote?
A: If you are a registered or SSPP shareholder, you may choose one of the following ways to cast your vote:
o By mail: Complete, date, sign and mail the proxy/voting instruction card in the enclosed
postage prepaid envelope.
o By telephone: Call 1-877-779-8683 toll free from the U.S. and Canada.
Call 201-536-8073 from outside the U.S. and Canada.
Page 2
o Via the Internet: Access the Edison International World Wide Web site
http://www.eproxyvote.com/eix
Access the SCE World Wide Web site http://www.eproxyvote.com/sce
Registered shareholders have a fourth option to cast their vote:
o By ballot at the meeting: Attend the annual meeting and complete a written ballot distributed
at the meeting.
If you vote by telephone or via the Internet, follow the instructions on the enclosed card. You will be
asked to enter the specially assigned control number on your proxy card. Additionally, if you vote by
telephone, you will receive recorded instructions, and if you vote via the Internet, an electronic proxy
card. Voting by telephone and via the Internet is available 24 hours a day, seven days a week, through
midnight, May 13, 2002, except for SSPP shareholders who must vote by 5:00 p.m., Eastern Time, on May 9,
2002.
By voting by mail, telephone or the Internet, you will authorize the individuals named on the proxy card,
referred to as the proxies, or the SSPP trustee in its capacity as stock fund investment manager, to vote
your shares according to your instructions. You are also authorizing those persons to vote your shares on
any other matter properly presented at the meeting.
If you hold shares in street name, you will provide voting instructions as follows:
o By mail: On cards received from your broker or other nominee.
o By telephone or via the Internet: If offered by your broker or other nominee.
o By ballot at the meeting: If you request a legal proxy from your broker or other
nominee and deliver the proxy to the inspector of election
before or at the meeting.
Under California law, you may transmit a proxy by telephone or via the Internet if authorized by you or your
attorney in fact. SHAREHOLDERS WHO VOTE BY TELEPHONE OR OVER THE INTERNET SHOULD NOT MAIL THE PROXY CARD.
Q: What happens if I return my proxy or vote by mail, telephone or the Internet, but I do not indicate my
voting preference?
A: If you return your proxy or vote by mail and do not indicate how you wish to vote for the nominees for
Director, the proxies and SSPP trustee will vote FOR election of all the nominees for Director (Item 1). If
you enter your control number by telephone or on the Internet and do not indicate how you wish to vote for
the nominees for Director, your shares will not be voted on the election.
Q: What happens if I do not return my proxy or provide voting instructions?
A: If you are a registered shareholder and you do not deliver voting instructions to a designated proxy or cast
a ballot at the annual meeting, your shares will not be voted. If you are an SSPP shareholder and you do
not deliver voting instructions to the trustee, the trustee as stock fund investment manager
Page 3
may vote your shares as it chooses. If you hold your shares in street name and you do not instruct your broker
or other nominee how to vote your shares, the broker or other nominee may be authorized to vote your shares
as it chooses on the matters to be considered at the meeting. If your broker lacks this discretionary
authority to vote on an item and properly indicates this to us, your shares will not be voted on that item
and we call this a "broker nonvote" on that item.
Q: What if I vote and then change my mind?
A: If you are a registered shareholder, you can revoke your proxy by:
o Writing to the Edison International or SCE Secretary;
o Voting again via mail, telephone or the Internet; or
o Voting in person at the annual meeting.
Your last vote will be the vote that is counted.
If you are an SSPP shareholder, you can revoke your voting instructions by voting again via mail, telephone
or the Internet by 5:00 p.m., Eastern Time, on May 9, 2002.
If you hold shares in street name, you should contact your broker or other nominee before the annual meeting
to determine whether you can change your voting instructions.
Q: How many votes do you need to hold the meeting?
A: As of the record date, March 15, 2002, Edison International had 325,793,174 shares of Edison International
Common Stock outstanding and entitled to vote. SCE had 5,150,198 shares of Cumulative Preferred Stock,
2,557,000 shares of $100 Cumulative Preferred Stock, and 434,888,104 shares of SCE Common Stock outstanding
and entitled to vote.
The holders of the Edison International Common Stock have the right to cast a total of 325,793,174 votes.
The holders of the SCE Cumulative Preferred Stock have the right to cast a total of 30,901,188 votes, the
holders of the SCE $100 Cumulative Preferred Stock have the right to cast a total of 5,114,000 votes, and
the holder of the SCE Common Stock, Edison International, has the right to cast a total of 434,888,104
votes. Voting together as a class, the SCE shareholders have the right to cast a total of 470,903,292 votes.
A quorum is required to transact business at the annual meeting. The presence at the annual meeting, in
person or by proxy, of shareholders entitled to cast at least a majority of the votes which all shareholders
are entitled to cast constitutes a quorum. If you properly return your proxy by mail, by telephone or via
the Internet, you will be considered part of the quorum, even if you abstain from voting or withhold votes,
and the proxies will vote your shares as you have indicated. If a broker or other nominee holding your
shares in street name votes your shares or returns a properly executed proxy representing your shares, your
shares will be considered as present and part of the quorum, even if your broker or other nominee does not
indicate a voting preference, or otherwise abstains or withholds votes, on any or all matters.
Page 4
Q: What vote is required to adopt the proposal at the meeting?
A: On Item 1, the Election of Directors, the 11 nominees receiving the highest number of affirmative or "for"
votes will be elected as Directors of Edison International and SCE, respectively. Votes withheld for any of
the nominees, abstentions or broker nonvotes will have the effect of reducing the number of affirmative
votes a candidate might otherwise have received.
Q: Who will count the votes?
A: EquiServe Trust Company, N.A., will tabulate the votes and act as the inspector of election. To protect the
confidentiality of votes cast under the SSPP, Edison International will not have access to any of the SSPP
shareholders' voting instructions, and SSPP voting results will only be reported in the aggregate.
Q: What shares are included on the proxy card?
A: If you hold shares in both Edison International and SCE, you will receive a card for each Company. The
shares listed on your card(s) represent all the shares of common stock and preferred stock registered in
your name (as distinguished from those held in street name), all whole shares held in the DRP, and all whole
shares held in the SSPP. You will receive separate cards from your broker or other nominee if you hold
shares in street name.
Q: What does it mean if I get more than one proxy card?
A: It indicates that your shares are held in more than one account, such as two brokerage accounts, and
registered in different names. You should vote each of the proxy cards to ensure that all of your shares
are voted.
Q: How much did this proxy solicitation cost?
A: Edison International and SCE have retained Georgeson Shareholder to solicit proxies from shareholders at an
estimated fee of $10,000 plus expenses. (This fee does not include the costs of printing and mailing the
proxy materials.) Edison International and SCE will pay all proxy solicitation costs. Some of the
directors, officers and other employees of Edison International and/or SCE also may solicit proxies
personally, by mail, by telephone or by other electronic means for no additional compensation, except for
customary overtime pay. Edison International and SCE will also reimburse brokers and other nominees for
their reasonable out-of-pocket expenses for forwarding proxy materials to the beneficial owners of their
stocks and obtaining voting instructions.
Q: Whom can I call with any questions?
A: You may call Wells Fargo Bank at 800-347-8625 or visit their World Wide Web site at
http://www.wellsfargo.com/comshareowner_services
Q: How do the Boards recommend I vote?
A: The Edison International and SCE Boards recommend the election of their nominees for Directors listed in
this Proxy Statement.
Page 5
HOUSEHOLDING OF PROXY STATEMENTS AND ANNUAL REPORTS
If you are a registered shareholder and share an address with other registered shareholders, you may be
receiving multiple copies of the applicable Annual Report to Shareholders and Proxy Statement. You can save the
Companies money if you direct us to discontinue mailing all future multiple annual reports, proxy statements,
proxy statements combined with a prospectus, and information statements by marking the appropriate box on the
enclosed proxy card, or by following the instructions provided when you vote by telephone or over the Internet.
The Companies intend to deliver only one respective annual report, one proxy statement, one proxy statement
combined with a prospectus, and one information statement to multiple registered shareholders sharing an address
if such multiple shareholders have given their consent and the Companies have not received contrary instructions
from one or more of such shareholders. This practice is commonly referred to as "householding." The Companies
do not plan to electronically household documents. Your consent to householding is perpetual, meaning it will
remain in effect until revoked. Eliminating duplicate mailings will not affect your receipt of future proxy
cards. To resume the mailing of individual copies of future annual reports, proxy statements, proxy statements
combined with a prospectus, and information statements to a particular account, you may contact Wells Fargo Bank,
N.A., Attn: Householding, P. O. Box 64854, St. Paul, Minnesota 55164-0854, or at 800-347-8625, and your request
will be effective within thirty days after receipt. Additionally, the Companies have been notified that certain
brokers and other nominees will household the Companies' annual reports and proxy statements for shareholders who
hold in street name and have consented to householding. In this case, you may request an individual copy of this
Joint Proxy Statement and/or the applicable 2001 Annual Report by contacting your broker or other nominee.
ELECTRONIC ACCESS TO PROXY STATEMENTS AND ANNUAL REPORTS
This Joint Proxy Statement and the Edison International and SCE 2001 Annual Reports are available on Edison
International's Internet site at http://www.edisoninvestor.com. Most shareholders can view future shareholder
communications including proxy statements and annual reports over the Internet instead of receiving paper copies
in the mail and save the Companies the cost of producing and mailing these documents.
If you are an SSPP shareholder, and you use company E-mail in the ordinary course of performing your job and
are expected to log-on to E-mail routinely to receive mail and communications, Edison International intends to
deliver proxy statements and annual reports to you electronically for every shareholders' meeting. You may also
request paper copies through the date of the annual meetings by contacting Edison International, c/o SCE Law
Department, Corporate Governance, 2244 Walnut Grove Avenue, P. O. Box 800, Rosemead, California 91770 or at
626-302-2662; and after the annual meetings by contacting Edison International, Investor Relations, 2244 Walnut
Grove Avenue, P. O. Box 999, Rosemead, California 91770 or at 626-302-1937.
If you are a registered shareholder and/or SSPP shareholder who does not have a company-assigned E-mail
address, you can choose this option by checking the appropriate box on your proxy card or by following the
instructions provided if you vote by telephone or over the Internet. In order to receive shareholder
communications electronically, you must have an E-mail account, access to the Internet through an Internet
service provider, and a Web browser that supports secure connections. Acceptance of electronic delivery of these
documents will remain in effect until withdrawn. Your consent to electronic delivery can be withdrawn at any
time by contacting Wells Fargo Bank, N.A., P. O. Box 64856, St. Paul, Minnesota 55164-0856 or at 800-347-8625.
You may also request paper copies
Page 6
of the proxy materials from the date you receive this Proxy Statement through the date of the applicable annual
meetings by contacting Edison International or SCE, as the case may be, c/o SCE Law Department, Corporate
Governance, 2244 Walnut Grove Avenue, P. O. Box 800, Rosemead, California 91770 or at 626-302-2662; and after the
annual meetings by contacting Edison International, Investor Relations, 2244 Walnut Grove Avenue, P. O. Box 999,
Rosemead, California 91770 or at 626-302-1937.
If you are a registered shareholder and/or SSPP shareholder who does not have a company-assigned E-mail
address and choose to view future proxy statements and annual reports over the Internet, you will receive notice
each year containing the Internet address of those materials.
If you hold shares in street name, check the information provided by the nominee holding your shares for
instructions on how to elect to view future proxy statements and annual reports over the Internet. Your broker
or other nominee will receive notice containing the Internet address to use to access Edison International's and
SCE's Proxy Statement and Annual Reports.
For all shareholders, although there are no costs for this service, there may be costs associated with
electronic access, such as usage charges from Internet access providers and telephone companies for which you
will be responsible.
ELECTION OF DIRECTORS
Item 1 on Proxy Card
NOMINEES FOR ELECTION
Eleven Directors will be elected to the Edison International and SCE Boards, respectively, to hold office
until the next annual meeting. Should any of the nominees become unavailable to stand for election as a
Director, the proxies will have the authority to vote for substitute nominees as they choose.
The nominees for Directors of Edison International and SCE are the same, except for Mr. Bryson who is a
nominee for the Edison International Board only, and Mr. Fohrer who is a nominee for the SCE Board only. Three
current Directors, Warren Christopher, Carl F. Huntsinger, and Charles D. Miller, are retiring from both Boards.
Messrs. Freeman, Karatz and Schlosberg are being nominated to serve as Directors for the first time for both
Boards. A brief biography of each nominee is presented below.
JOHN E. BRYSON*
Chairman of the Board, President and Chief Executive Officer of Edison International and Chairman of the Board of
Edison Mission Energy (an electric power generation nonutility subsidiary of Edison International) (since 2000);
Chairman of the Board and Chief Executive Officer of Edison International and SCE (1990-1999)
Mr. Bryson has been a Director of Edison International since 1990. He is a Director of The Walt Disney Company,
The Boeing Company, and Pacific American Income Shares, Inc. & Western Asset Funds, Inc. Mr. Bryson is a graduate
of Stanford University and Yale Law School. Age 58.
* John E. Bryson is a nominee for Director of Edison International only.
Page 7
ALAN J. FOHRER**
Chairman of the Board and Chief Executive Officer of SCE (since 2002); President and Chief Executive Officer of
Edison Mission Energy (2000-2001); Chairman of the Board of Edison Mission Energy (1999); Executive Vice
President and Chief Financial Officer of Edison International (1996-2000)
Mr. Fohrer has been a Director of SCE since January 1, 2002. Mr. Fohrer holds two degrees in civil engineering
from the University of Southern California, and received his MBA degree from California State University, Los
Angeles. Age 51.
BRADFORD M. FREEMAN
Founding Partner, Freeman Spogli & Co. (private investment company) (since 1983)
Mr. Freeman is being nominated for the first time as a Director of Edison International and SCE. He is a
Director of RDO Equipment Co. Mr. Freeman is a graduate of Stanford University, and holds an MBA degree from
Harvard Business School. Age 60.
JOAN C. HANLEY
The Former General Partner and Manager of Miramonte Vineyards (1973-1998)
Mrs. Hanley has been a Director of SCE since 1980 and a Director of Edison International since 1988. She is a
Director of the Harbor-UCLA Research and Education Institute, Chairman of the Harbor-UCLA Collegium, and a
Trustee of Pomona College. Mrs. Hanley is a graduate of the University of Washington. Age 69.
BRUCE KARATZ
Chairman, President and Chief Executive Officer of KB Home (homebuilding) (since 1993)
Mr. Karatz is being nominated for the first time as a Director of Edison International and SCE. He is a Director
of Avery Dennison Corporation, Honeywell International, Inc., The Kroger Company, and National Golf Properties,
Inc. Mr. Karatz is a graduate of The Blake School and Boston University, and holds a Law degree from the
University of Southern California. Age 56.
LUIS G. NOGALES
Managing Partner of Nogales Investors (a private equity investment company) (since 2001); President of Nogales
Partners (a private equity investment company) (1990-2001)
Mr. Nogales has been a Director of Edison International and SCE since 1993. He is a Director of Arbitron Inc.
and KB Home. Mr. Nogales is a graduate of San Diego State University and Stanford Law School. Age 58.
RONALD L. OLSON
Partner of the law firm of Munger, Tolles and Olson (since 1970)
Mr. Olson has been a Director of Edison International and SCE since 1995. He is a Director of Berkshire
Hathaway, Inc., Pacific American Income Shares, Inc. & Western Asset Funds, Inc., and City National Corporation.
Mr. Olson is a graduate of Drake University and University of Michigan Law School and holds a Diploma in Law from
Oxford University. Age 60.
** Alan J. Fohrer is a nominee for Director of SCE only.
Page 8
JAMES M. ROSSER
President of California State University, Los Angeles (since 1979)
Dr. Rosser has been a Director of SCE since 1985 and a Director of Edison International since 1988. He is a
Director of United California Bank. Dr. Rosser holds three degrees from Southern Illinois University. Age 63.
RICHARD T. SCHLOSBERG, III
President and Chief Executive Officer of The David and Lucile Packard Foundation (private family foundation)
(since 1999); Publisher and Chief Executive Officer, Los Angeles Times (newspaper) (1994-1997); Executive Vice
President and Director, The Times Mirror Company (media communications) (1994-1997)
Mr. Schlosberg is being nominated for the first time as a Director of Edison International and SCE.
Mr. Schlosberg is a graduate of the United States Air Force Academy, and holds an MBA degree from Harvard Business
School. Age 58.
ROBERT H. SMITH
Managing Director of Smith & Crowley, Inc. (merchant banking) (since 1992)
Mr. Smith has been a Director of SCE since 1987 and a Director of Edison International since 1988. He is a
Director of Tarpanwear International, Inc., and a Trustee of the University of Southern California and Santa
Clara University. Mr. Smith is a graduate of the University of Southern California and holds a Law degree from
Van Norman University. Age 66.
THOMAS C. SUTTON
Chairman of the Board and Chief Executive Officer of Pacific Life Insurance Company (since 1990)
Mr. Sutton has been a Director of Edison International and SCE since 1995. He is a Director of Newhall Land &
Farming Company and The Irvine Company. Mr. Sutton is a graduate of the University of Toronto. Age 59.
DANIEL M. TELLEP
Retired Chairman of the Board of Lockheed Martin Corporation (aerospace industry) (1996)
Mr. Tellep has been a Director of Edison International and SCE since 1992. Mr. Tellep holds two degrees from the
University of California at Berkeley and has completed studies at Harvard University. Age 70.
BOARD COMMITTEES
The Edison International and SCE Board Committees are the Audit Committee, Compensation and Executive
Personnel Committee, Executive Committee, Finance Committee and Nominating Committee. The composition of each
Committee is the same for Edison International and SCE, except for the Executive Committee. Each Committee held
the same number of meetings in 2001, unless otherwise indicated in the table below. This table describes the
Boards' Committees.
Page 9
NUMBER OF
COMMITTEE NAME MEETINGS
AND CURRENT MEMBERS COMMITTEE FUNCTIONS IN 2001
------------------- ------------------- -------
Audit o Meets regularly with management, the independent public 6
Daniel M. Tellep, Chair accountants, and the internal auditors to make
Carl F. Huntsinger inquiries regarding the manner in which the
Charles D. Miller responsibilities of each are being discharged.
Robert H. Smith
Thomas C. Sutton o Recommends to the Boards the annual appointment of the
independent public accountants, Committee charter
revisions, and the inclusion of the year-end audited
financial statements in the Annual Report on Form 10-K.
o Reviews with the independent public accountants the
scope of audit and other engagements and the related
fees, their independence, the adequacy of internal
accounting controls, and the year-end audited financial
statements.
o Reviews with management the audit plans and year-end
audited financial statements.
o Reviews information provided on legal proceedings,
environmental compliance, health and safety compliance,
information technology security, legal compliance,
business ethics monitoring and internal auditing
programs.
Compensation and o Reviews the performance and sets the compensation of 4
Executive Personnel the Executive Officers.
Robert H. Smith, Chair
Charles D. Miller o Approves the design of executive compensation programs.
Luis G. Nogales
James M. Rosser o May elect designated officers and determine their
Thomas C. Sutton compensation.
o Participates in executive succession planning and
management development.
o Has additional duties described in the "Compensation
and Executive Personnel Committees' Report on Executive
Compensation" below.
Page 10
Executive o Has all the authority of the Boards between meetings
Edison International except to the extent limited by the California General Edison
Warren Christopher, Chair Corporation Law. International:
John E. Bryson 4
Carl F. Huntsinger
Ronald L. Olson
James M. Rosser
SCE
---
Warren Christopher, Chair SCE:
Alan J. Fohrer 2
Carl F. Huntsinger
Ronald L. Olson
James M. Rosser
Finance o Regularly reviews the financial structure of their 3
Luis G. Nogales, Chair respective company.
Joan C. Hanley
Ronald L. Olson o The Edison International Finance Committee reviews the
James M. Rosser financial planning process and investment outlook for
Thomas C. Sutton Edison International and its nonutility subsidiaries,
Daniel M. Tellep and approves certain committed investments.
o The SCE Finance Committee reviews the five-year capital
expenditure outlook, financing plans, total revenue
requirements, and earnings trends of SCE as well as
approving certain capital projects.
Nominating o Periodically consults with management, reviews 1
Joan C. Hanley, Chair shareholder suggestions of Director candidates, and
Warren Christopher makes recommendations regarding Board composition and
Carl F. Huntsinger selection of candidates for election.
Charles D. Miller
Ronald L. Olson
For consideration by the Nominating Committees, shareholder suggestions for Director candidates should be
submitted in writing to the Secretary of Edison International and/or SCE. The deadlines and additional
procedures for shareholder nominations are in "Shareholder Proposals and Nominations for 2003 Annual Meetings"
below.
Page 11
BOARD MEETINGS AND ATTENDANCE
During 2001, the Edison International Board and the SCE Board each met 15 times.
During 2001, all current Directors attended 75% or more of all Edison International and SCE Board and
applicable Committees' meetings he or she was eligible to attend.
BOARD COMPENSATION
Directors who are employees of Edison International or SCE are not paid additional compensation for serving
as Directors. Non-employee Directors are compensated as described below.
Fees
During 2001, each non-employee Director was paid as follows:
o an annual Board retainer of $25,000,
o an annual retainer of $3,000 to Board Committee chairpersons,
o an annual Executive Committee retainer of $2,000 to Executive Committee members,
o $1,500 for each Board meeting attended,
o $1,000 for each Board Committee meeting attended, and
o $1,500 for any other business meetings attended as a Director.
Non-employee Directors serve on both the Edison International Board and the SCE Board and the same
Committees of each Board. Non-employee Directors receive only one retainer and, if the meetings of the Boards or
the same Committees of each Company are held concurrently or consecutively, they receive only one meeting fee.
It is the usual practice of Edison International and SCE that meetings of the Edison International and SCE Boards
are held together or consecutively and a single meeting fee is paid to each non-employee Director for each set of
meetings. Edison International and SCE Committee meetings are similarly managed. Directors are reimbursed for
out-of-pocket expenses they incur serving as Directors.
Due to an illness, Dr. Edward Zapanta resigned as a Director from the Edison International and SCE Boards,
effective October 31, 2001. He was paid an additional $12,500 equal to the remaining annual Board retainer had
he been able to complete his term.
Equity Compensation Plan
Under terms of the Edison International Equity Compensation Plan, each non-employee Director of Edison
International and SCE is automatically granted upon election or reelection to the Boards:
Page 12
o 500 shares of Edison International Common Stock, and
o 300 deferred stock units.
Directors serving on both Boards receive only one award of stock and deferred stock units per year. The
deferred stock units are credited to the Director's deferred compensation plan account. Each stock unit
represents the value of one share of Edison International Common Stock. Stock units accrue dividend equivalents,
if and when dividends are paid on the Edison International Common Stock, that are converted to additional stock
units under the plan. The stock units cannot be voted or sold. The deferred stock units will be distributed in
cash in a lump sum upon the Director's retirement from the Boards unless the Director's request to receive
distribution in the form of installments over 5, 10, or 15 years was previously approved. Resignation prior to
retirement will result in a lump sum payment.
Deferred Compensation Plans
1985 Deferred Compensation Plan
SCE non-employee Directors were permitted to defer compensation earned from October 1, 1985, through
December 31, 1989, under the terms of the SCE 1985 Deferred Compensation Plan for Directors. These amounts are
deferred until the participant ceases to be a Director, dies or attains a predetermined age of at least 65, but
not greater than 72. The account may be paid in installments of 10 or 15 equal annual installments or 120 or 180
equal monthly installments. If a participant dies before payments have begun, his or her beneficiary will
receive the account payments over the term elected by the participant. In addition, the beneficiary will receive
annual payments equal to 75% of the participant's total deferred commitment for ten years. If a participant dies
after payments have begun, the remainder of his or her account will continue to be paid to the beneficiary.
Following the completion of these payments, if the beneficiary is the surviving spouse, the person will be
entitled to a five-year certain life annuity equal to 50% of the payments the participant had been receiving. If
the beneficiary is someone other than a spouse, the payments will be made for five years only. All amounts
payable under this plan are treated as obligations of SCE.
Director Deferred Compensation Plan
Non-employee Directors of Edison International and SCE are eligible to defer up to 100% of their Board
compensation, including any retainers, and any meeting fees under the Edison International Director Deferred
Compensation Plan. A grantor trust has been adopted to fund the deferred compensation liability. Amounts may be
deferred until a specified year, retirement, death or discontinuance of service as a Director. Compensation
deferred until a specified year is paid as a single lump sum. Compensation deferred until retirement or death
may be paid as a single lump sum, in monthly installments of 60, 120, or 180 months, or in a combination of a
partial lump sum and installments. Deferred compensation is paid as a single lump sum or in three annual
installments upon any other discontinuance of service as a Director. All amounts payable under this plan are
treated as obligations of Edison International.
Preferential interest (interest considered under the Securities and Exchange Commission rules to be at
above-market rates) was credited during 2001 to the plan accounts of the following Directors under the 1985
Deferred Compensation Plan and the Director Deferred Compensation Plan:
Page 13
Preferential Interest
---------------------
1985 Plan Director DCP
--------- ------------
($) ($)
Warren Christopher 4,600 0
Joan C. Hanley 99,159 0
Carl F. Huntsinger 99,159 12,549
Ronald L. Olson 0 5,162
James M. Rosser 99,159 12,670
Robert H. Smith 0 6,176
Thomas C. Sutton 0 3,873
Edward Zapanta 99,159 571
Mr. Christopher was re-elected as a Director of Edison International and SCE in 1997 following distinguished
service as U. S. Secretary of State. Retirement and deferred compensation benefit payments attributable to his
prior service as a Director will continue to be paid. Any additional benefits accruing during his current term
as a Director will be payable to Mr. Christopher in accordance with the terms of the plans in effect at the time
of his subsequent retirement.
STOCK OWNERSHIP OF DIRECTORS AND EXECUTIVE OFFICERS
The following table shows the number of equity securities of Edison International, SCE and any of their
subsidiaries beneficially owned as of February 28, 2002, except as otherwise noted, by the respective Directors
and Executive Officers of Edison International and SCE. The table includes shares that can be acquired through
April 29, 2002, through the exercise of stock options and the payment of Retention Incentive deferred stock
units. Unless otherwise noted, each individual has sole voting and investment power.
Amount and Nature of Beneficial Ownership
-----------------------------------------
Deferred Total Shares Percent
Name of Title of Stock SSPP Beneficially of
Beneficial Owner Class of Stock Units(1)(2 Options(2) Shares(3) Owned(4) Class
---------------- -------------- ---------- ---------- --------- -------- -----
John E. Bryson(5) Edison International Common Stock 61,890 830,051 18,260 975,521(7) *
Warren Christopher Edison International Common Stock 3,685(8) *
Theodore F. Craver, Jr.(5) Edison International Common Stock 23,088 107,051 137,229(9) *
Bryant C. Danner(5) Edison International Common Stock 23,010 280,626 4,210 316,273(10) *
John R. Fielder(5) Edison International Common Stock 10,743 129,101 14,430 158,358 *
Alan J. Fohrer(5) Edison International Common Stock 26,541 261,526 28,308 320,961 *
Robert G. Foster Edison International Common Stock 14,782 113,875 4,760 134,086 *
Stephen E. Frank(6) Edison International Common Stock 25,323 404,100 6,620 442,880 *
Bradford M. Freeman Edison International Common Stock 50,000 *
Joan C. Hanley Edison International Common Stock 9,594(8) *
Carl F. Huntsinger Edison International Common Stock 14,537(11) *
Bruce Karatz Edison International Common Stock 3,300(12) *
Charles D. Miller Edison International Common Stock 20,586(13) *
Luis G. Nogales Edison International Common Stock 4,025 *
Ronald L. Olson Edison International Common Stock 29,494(14) *
Stephen E. Pickett(5) Edison International Common Stock 11,199 62,775 3,424 77,914 *
Harold B. Ray Edison International Common Stock 18,170 139,051 1,603 159,789(15) *
Page 14
Amount and Nature of Beneficial Ownership
-----------------------------------------
Deferred Total Shares Percent
Name of Title of Stock SSPP Beneficially of
Beneficial Owner Class of Stock Units(1)(2 Options(2) Shares(3) Owned(4) Class
---------------- -------------- ---------- ---------- --------- -------- -----
James M. Rosser Edison International Common Stock 8,600(16) *
Richard T. Schlosberg, III Edison International Common Stock 1,000(12) *
Robert H. Smith Edison International Common Stock 19,623(17) *
Thomas C. Sutton Edison International Common Stock 30,717(8) *
Daniel M. Tellep Edison International Common Stock 17,634(8) *
------------------------------------------------------------------------------------------------------------------------------
All Directors and Executive Officers
of Edison International as a group (24 individuals)
Edison International Common Stock 252,367 2,518,306 85,171 3,167,064(18) *
------------------------------------------------------------------------------------------------------------------------------
All Directors and Executive Officers
of SCE as a group (26 individuals)
Edison International Common Stock 156,622 1,489,597 88,003 1,953,143(19) *
==============================================================================================================================
* Represents 1% or less of the class.
(1) The Retention Incentive deferred stock units are described in footnote (2) to the table below entitled
"Long-Term Incentive Plan Awards in Last Fiscal Year."
(2) Includes shares which can be acquired or will be paid on an accelerated basis due to retirement, death,
disability and/or termination of employment.
(3) SSPP shares for which instructions are not received from any plan participant may be voted by the Edison
International stock fund investment manager as it chooses.
(4) Includes amounts listed in the first three columns.
(5) Mr. Bryson is a Director and Executive Officer of Edison International only. Messrs. Danner and Craver are
Executive Officers of Edison International only. Messrs. Fielder and Pickett are Executive Officers of SCE
only. Mr. Fohrer is a Director of SCE only, but an Executive Officer of both Edison International and SCE.
(6) Mr. Frank retired as a Director and Executive Officer of Edison International and SCE effective January 1,
2002.
(7) Includes 14,000 shares held as co-trustee of trust with shared voting and investment power, 6,000 shares
held as trustee of trust with shared voting and sole investment power, 45,120 shares held as co-trustee and
co-beneficiary of trust with shared voting and investment power, and 200 shares held by spouse with shared
voting and investment power.
(8) Held as co-trustee and co-beneficiary of trust with shared voting and investment power.
(9) Includes 6,000 shares held as co-trustee and co-beneficiary of trust with shared voting and investment
power.
(10) Includes 8,427 shares held with spouse as joint tenants with shared voting and investment power.
(11) Includes 9,537 shares held as trustee and co-beneficiary with shared voting and sole investment power, and
5,000 shares held by spouse with shared voting and investment power.
Page 15
(12) Shares are beneficially owned as of March 1, 2002.
(13) Includes 17,586 held as co-trustee and co-beneficiary of trust with shared voting and investment power, and
3,000 shares held in a foundation with shared voting and investment power which are not deemed beneficially
owned under Section 16 of the Securities Exchange Act of 1934.
(14) Includes 4,494 shares held as co-trustee and co-beneficiary of trust with shared voting and investment
power, 10,000 shares held in a 401(k) plan with shared voting and sole investment power, and 15,000 shares
held in a foundation with shared voting and investment power which are not deemed beneficially owned under
Section 16 of the Securities Exchange Act.
(15) Includes 965 shares held as co-trustee and co-beneficiary of trust with shared voting and investment power.
(16) Held as co-trustee and co-beneficiary with shared voting and sole investment power.
(17) Includes 6,400 shares held as co-trustee and co-beneficiary of trust with shared voting and sole investment
power, 2,223 shares held by daughter for which Mr. Smith may be deemed to have shared voting and investment
power but disclaims beneficial ownership, and 3,000 shares held by spouse with shared voting and investment
power.
(18) Includes 136,092 shares held as co-trustee and co-beneficiary of trust with shared voting and investment
power, 8,427 shares held with spouse as joint tenants with shared voting and investment power, 4,300 shares
acquired after February 28, 2002, 14,000 shares held as co-trustee of trust with shared voting and
investment power, 15,000 shares held as co-trustee and co-beneficiary of trust with shared voting and sole
investment power, 9,537 shares held as trustee and co-beneficiary with shared voting and sole investment
power, 6,000 shares held as trustee of trust with shared voting and sole investment power, 10,000 shares
held in a 401(k) plan with shared voting and sole investment power, 8,200 shares held by spouse with shared
voting and investment power, 2,223 shares held by daughter for which may be deemed to have shared voting
and investment power but as to which beneficial ownership is disclaimed, and 18,000 shares held in a
foundation with shared voting and investment power.
(19) Includes 84,972 shares held as co-trustee and co-beneficiary of trust with shared voting and investment
power, 4,300 shares acquired after February 28, 2002, 15,000 shares held as co-trustee and co-beneficiary
of trust with shared voting and sole investment power, 9,537 shares held as trustee and co-beneficiary with
shared voting and sole investment power, 10,000 shares held in a 401(k) plan with shared voting and sole
investment power, 8,000 shares held by spouse with shared voting and investment power, 2,223 shares held by
daughter for which may be deemed to have shared voting and investment power but as to which beneficial
ownership is disclaimed, and 18,000 shares held in a foundation with shared voting and investment power.
SECTION 16(a) BENEFICIAL OWNERSHIP REPORTING COMPLIANCE
Edison International and SCE Directors and certain officers, and persons who own more than 10% of a
registered class of Edison International's or SCE's equity securities, are required to file ownership reports and
changes in ownership of such securities with the SEC and one designated national securities
Page16
exchange under Section 16(a) of the Securities Exchange Act. Based on a review of the reports and written
representations from the Directors and those officers, Edison International and SCE believe that all Section
16(a) filing requirements were met during 2001.
STOCK OWNERSHIP OF CERTAIN SHAREHOLDERS
The following are the only shareholders known by Edison International or SCE to beneficially own more than
5% of any class of either Companies' voting securities as of February 28, 2002, except as otherwise indicated:
Amount and
Nature of
Name and Address of Beneficial Percent
Title of Class of Stock Beneficial Owner Ownership of Class
----------------------- ---------------- --------- --------
Edison International Capital Research and Management Company 36,059,500(1) 11.1%
Common Stock 333 South Hope Street
Los Angeles, California 90071
Edison International State Street Bank and Trust Company 31,016,427(2) 9.5%
Common Stock 225 Franklin Street
Boston, Massachusetts 02011
Edison International J. P. Morgan Chase & Company 18,497,473(3) 5.6%
Common Stock 270 Park Avenue
New York, N. Y. 10017
Edison International Putnam Investments, LLC 17,064,503(4) 5.2%
Common Stock One Post Office Square
Boston, Massachusetts 02109
Edison International Capital Group International, Inc. 16,646,200(5) 5.1%
Common Stock 11100 Santa Monica Boulevard
Los Angeles, California 90025
SCE Common Stock Edison International 434,888,104(6) 100%
2244 Walnut Grove Avenue
Rosemead, California 91770
SCE Cumulative Preferred Stock O. Francis Biondi, Jr. 278,670(7) 5.4%
Brian J. Higgins
575 Lexington Avenue, 7th Floor
New York, New York 10022
(1) This information is based on a Schedule 13G dated September 10, 2001, as amended by Amendment No. 1 dated
February 11, 2002, filed with the SEC. Acting as an investment adviser to various investment companies,
Capital Research reports that it may be deemed to have sole investment power and no voting power over these
shares, but disclaims beneficial ownership.
(2) This information is based on a Schedule 13G, dated February 5, 2002, filed with the SEC. Acting in various
fiduciary capacities, State Street reports that it has sole voting power over 5,980,249 shares, sole
investment power over 31,001,164 shares, shared voting power over 24,212,659 shares, and shared investment
power over 15,263 shares. As of February 28, 2002, 24,132,295 shares of the class, or 7.4%, are held as the
SSPP Trustee. SSPP shares are voted in accordance with instructions
Page 17
given by participants, whether vested or not. SSPP shares for which instructions are not received may be voted
by the Edison International stock fund investment manager as it chooses. SSPP participants may not vote or
give instructions how to vote fractional shares.
(3) This information is based on a Schedule 13G dated February 13, 2002, filed with the SEC. As a holding
company for several wholly-owned subsidiaries, J. P. Morgan Chase reports that it has sole voting power over
14,093,570 shares, sole investment power over 17,556,282 shares, shared voting power over 699,029 shares,
and shared investment power over 939,391 shares.
(4) This information is based on a Schedule 13G, dated February 5, 2002, filed with the SEC. As the owner of
several investment advisers, Putnam Investments reports that it has shared voting power over 853,954 shares
and shared investment power over all 17,064,503 shares.
(5) This information is based on a Schedule 13G, dated February 11, 2002, filed with the SEC. As the parent
holding company of a group of investment management companies, Capital Group reports that it may be deemed
to have sole voting power over 13,317,700 shares and sole investment power over 16,646,200 shares, but
disclaims beneficial ownership.
(6) Edison International became the holder of all issued and outstanding shares of SCE Common Stock on
July 1, 1988, when it became the holding company of SCE. Edison International has sole voting and investment
power over these shares.
(7) This information is based on a Schedule 13D, dated January 18, 2002, as amended by Amendment Nos. 1, 2 and 3
dated January 22, 2002, January 31, 2002, and February 12, 2002, respectively, filed with the SEC by
Mr. Biondi, Mr. Higgins, King Street Capital, L.P. ("KSC"), King Street Advisors, L.L.C. ("KSA"), King Street
Capital Management, L.L.C. ("KSCM"), and King Street Capital, Ltd. ("KSC Ltd."), as a group, reporting
interests in shares of SCE's Cumulative Preferred Stock, 4.08% Series ($25 par value). Messrs. Biondi and
Higgins have shared voting and investment power over these shares. Because shareholders of the 4.08% Series
generally vote together as a class with the holders of other series of SCE's Cumulative Preferred Stock, SCE
does not consider the 4.08% Series as a separate class of its voting securities for purposes of this table.
Therefore, the "percent of class" shown in the table (5.4%) is the percentage of the entire class of
Cumulative Preferred Stock ($25 par value). However, the reporting persons state that KSC and KSA have
shared voting and investment power over 95,890 shares or 9.6% of the Series; KSCM and KSC Ltd. have shared
voting and investment power over 182,780 shares or 18.3% of the Series; and, Messrs. Biondi and Higgins have
shared voting and investment power over 278,670 shares or 27.9% of the Series. KSC's, KSA's, and KSCM's
address is 575 Lexington Avenue, 7th Floor, New York, New York 10022, and KSC Ltd.'s address is c/o HWR
Services, Craigmuir Chambers, P. O. Box 71, Road Town, Tortola, British Virgin Islands.
Page 18
EXECUTIVE COMPENSATION
SUMMARY COMPENSATION TABLE(1)
The following table presents information regarding compensation of the Chief Executive Officers of Edison
International and SCE ("CEO"), and the other four most highly compensated Executive Officers of Edison
International and SCE, for services rendered during 1999, 2000 and 2001. These individuals are referred to as
"Named Officers" in this Joint Proxy Statement.
Long-Term Compensation
----------------------
Annual Compensation Awards Pay-
------------------- ------ ----
outs
(a) (b) (c) (d) (e) (f) (g) (h) (i)
--- --- --- --- --- --- --- --- ---
Other Re- Securities All
Annual stricted Underlying LTIP Other
Name and Compen- Stock Options/ Pay- Compen-
Principal Position(2) Year Salary Bonus sation(3) Award(s) SARs(4) outs sation(5)
--------------------- ---- ------ ----- --------- -------- ------- ---- ---------
($) ($) ($) ($) (#) ($) ($)
John E. Bryson, Chairman 2001 950,000 1,350,000 444 -- 0 -- 817,787
of the Board, President and 2000 950,000 0 718 -- 1,273,600 -- 649,704
CEO of Edison International 1999 900,000 1,260,000 601 -- 267,800 -- 521,053
Stephen E. Frank, Chairman 2001 617,000 585,000 2,040 -- 0 -- 36,733
of the Board, President and 2000 617,000 0 1,606 -- 321,600 -- 106,005
CEO of SCE 1999 593,000 711,600 1,114 -- 117,700 -- 79,311
Theodore F. Craver, Jr., 2001 375,000 523,600 0 -- 0 -- 51,930
Senior Vice President, CFO 2000 375,000 100,000 0 -- 244,800 -- 45,488
and Treasurer of Edison 1999 305,000 347,100 0 -- 53,000 -- 31,858
International
Bryant C. Danner, Executive 2001 470,600 424,200 0 -- 0 -- 169,811
Vice President and General 2000 470,600 0 0 -- 483,100 -- 153,156
Counsel of Edison 1999 435,000 534,000 0 -- 83,100 -- 114,863
International
Alan J. Fohrer, President 2001 512,000 254,800 3,056 -- 0 -- 129,366
and CEO of Edison Mission 2000 477,000 0 2,603 -- 497,800 -- 101,220
Energy 1999 397,000 486,000 0 -- 83,100 -- 63,391
Harold B. Ray, 2001 390,000 373,100 0 -- 0 -- 58,992
Executive Vice President 2000 390,000 50,000 0 -- 171,200 -- 63,573
of SCE 1999 372,000 446,400 0 -- 73,800 -- 59,427
Robert G. Foster, 2001 330,000 300,000 0 -- 0 -- 45,115
Senior Vice President 2000 322,500 0 0 -- 128,900 -- 67,053
of Edison International and 1999 284,000 242,800 0 -- 49,300 -- 59,199
SCE
John R. Fielder, 2001 272,500 235,950 0 -- 0 -- 20,907
Senior Vice President 2000 272,500 0 0 -- 103,400 -- 42,794
of SCE 1999 260,000 231,400 0 -- 45,200 -- 33,740
Stephen E. Pickett, 2001 250,000 226,875 0 -- 0 -- 29,087
Vice President and 2000 250,000 0 0 -- 97,000 -- 32,152
General Counsel of SCE 1999 230,000 158,700 0 -- 22,900 -- 25,034
Page 19
(1) For Edison International, the Named Officers for 2001 are John E. Bryson, Stephen E. Frank, Theodore F.
Craver, Jr., Bryant C. Danner and Alan J. Fohrer. For SCE, the Named Officers for 2001 are Stephen E.
Frank, Harold B. Ray, Robert G. Foster, John R. Fielder and Stephen E. Pickett.
(2) The principal positions shown are at December 31, 2001. Effective January 1, 2002, Mr. Frank retired as
Chairman, President and CEO of SCE; Mr. Fohrer resigned as President and CEO of Edison Mission Energy; and
Mr. Foster resigned as Senior Vice President of Edison International. Effective January 1, 2002, Mr. Craver
became Executive Vice President, CFO and Treasurer of Edison International; Mr. Fohrer became Chairman of
the Board and CEO of SCE; Mr. Foster became President of SCE; and Mr. Pickett became Senior Vice President
and General Counsel of SCE.
(3) Includes perquisites if in total they exceed the lesser of $50,000 or 10% of annual salary plus annual
incentive, plus reimbursed taxes.
(4) No Edison International nonqualified stock options were granted to the Named Officers in 2001.
(5) The amounts shown in column (i) for 2001 include plan contributions (contributions to the SSPP and a
supplemental plan for eligible participants who are affected by SSPP participation limits imposed on higher
paid individuals by federal tax law), preferential interest (that portion of interest that is considered
under SEC rules to be at above-market rates) accrued on deferred compensation, vacation sale proceeds,
survivor benefits, disability benefits, benefit forfeiture allocations and forgiven loans in the following
amounts:
Benefit
Plan Preferential Vacation Survivor Disability Forfeiture Loan
Contributions Interest Sold Benefits* Benefits Allocations Forgiven
------------- -------- ---- --------- -------- ----------- --------
($) ($) ($) ($) ($) ($) ($)
--- --- --- --- --- --- ---
John E. Bryson 31,050 704,608 0 81,937 0 193 0
Stephen E. Frank 7,650 2,754 0 26,329 0 0 0
Theodore F. Craver, Jr. 7,975 32,291 0 11,563 0 101 0
Bryant C. Danner 14,660 54,757 0 86,548 13,845 0 0
Alan J. Fohrer 32,524 55,768 0 29,293 11,756 24 0
Harold B. Ray 7,650 31,703 0 19,630 0 8 0
Robert G. Foster 7,650 182 6,345 8,061 0 20 22,857
John R. Fielder 7,650 603 5,240 7,365 0 48 0
Stephen E. Pickett 7,650 10,668 4,810 5,918 0 40 0
-------------------
* Includes survivor benefits under the Survivor Benefit Plan, Executive Deferred Compensation Plan, 1985
Deferred Compensation Plan, Survivor Income Continuation Plan, and Supplemental Survivor
Income/Retirement Income Plan.
Page 20
AGGREGATED OPTION / SAR EXERCISES IN 2001
AND FY-END OPTION / SAR VALUES
The following table presents information regarding the exercise of Edison International stock options during
2001 by any of the Named Officers, and regarding unexercised options held at year-end 2001 by any of the Named
Officers. No SARs were exercised during 2001 or held at year-end 2001 by any of the Named Officers.
(a) (b) (c) (d) (e)
--- --- --- --- ---
Number of Securities Value of
Underlying Unexercised
Unexercised In-the-Money
Options / SARs Options / SARs at
Shares at FY-End(1) (2) FY-End(1) (3)
Acquired Value (#) ($)
on Exercise Realized Exercisable / Exercisable /
Name (#) ($) Unexercisable Unexercisable
---- --- --- ------------- -------------
John E. Bryson -- 554,400(4) 771,101 / 173,899 68,700 / 0
Stephen E. Frank -- 1,081,528(5) 327,850 / 76,250 0 / 0
Theodore F. Craver, Jr. -- -- 87,551 / 32,749 0 / 0
Bryant C. Danner -- 756,728(6) 248,676 / 252,724 22,900 / 0
Alan J. Fohrer -- 967,208(7) 237,976 / 52,724 25,763 / 0
Harold B. Ray -- -- 109,675 / 47,825 0 / 0
Robert G. Foster -- -- 96,625 / 31,975 0 / 0
John R. Fielder -- -- 119,400 / 27,600 11,450 / 0
Stephen E. Pickett -- -- 56,550 / 14,350 4,008 / 0
(1) Each Edison International stock option may be exercised for one share of Edison International Common Stock
at an exercise price equal to the fair market value of the underlying Common Stock on the date the option
was granted. Dividend equivalents that may accrue on some of the Edison International stock options
accumulate without interest and are paid in cash. Options generally expire 10 years after the date of
grant. Edison International stock options awarded prior to 2000 include a dividend equivalent feature.
Dividend equivalents on stock options issued after 1993 and prior to 2000 are accrued to the extent
dividends are declared on Edison International Common Stock, and are subject to reduction unless certain
performance criteria are met. Only a portion of the 1999 Edison International stock option awards included
a dividend equivalent feature. Stock options awarded after 1999 do not include dividend equivalents.
Options issued after 1997 generally vest in 25% annual installments over a four-year period. Stock options
issued prior to 1998 had a three-year vesting period. If an option holder retires, dies or is permanently
and totally disabled (qualifying event) during the vesting period, the unvested options vest on a pro rata
basis. Unvested options of Messrs. Bryson, Danner, Fohrer and Ray will fully vest upon a qualifying event.
If a qualifying event occurs, the vested options may continue to be exercised pursuant to their original
terms by the recipient or beneficiary. If an option holder is terminated other than by a qualifying event,
unvested options are forfeited. Options which had vested as of the prior anniversary date of the grant are
also forfeited unless exercised within 180 days of the date of termination except that if the termination is
covered by the Edison International
Page 21
Executive Severance Plan, the terminated executive will receive one additional year of vesting credit and
must exercise vested options within 12 months.
(2) In October 2001, Edison International offered to exchange deferred stock units for Edison International
stock options held by active employees that were issued during the year 2000. The Named Officers elected to
accept the exchange offer with respect to the following number of Edison International stock options which
have been canceled:
Options Exchanged
-----------------
John E. Bryson 1,273,600
Stephen E. Frank 321,600
Theodore F. Craver, Jr. 244,800
Bryant C. Danner 283,100
Alan J. Fohrer 497,800
Harold B. Ray 171,200
Robert G. Foster 128,900
John R. Fielder 103,400
Stephen E. Pickett 97,000
The deferred stock units received by the Named Officers in exchange for their Edison International stock
options are listed in the table below entitled "Long-Term Incentive Plan Awards in Last Fiscal Year," and
the terms and conditions of the deferred stock units are described in footnote (3) to that table.
(3) Edison International stock options have been treated as "in-the-money" if the fair market value of the
underlying stock at year-end 2001 exceeded the exercise price of the options. The dollar amounts shown for
Edison International stock options are the differences between (i) the fair market value of the Edison
International Common Stock underlying all unexercised "in-the-money" options at year-end 2001 and (ii) the
exercise prices of those options.
Page 22
The aggregate value at year-end 2001 of all accrued dividend equivalents, for the Named Officers was:
$ / $
-----
Exercisable /Unexercisable
--------------------------
John E. Bryson 3,201,254 / 0
Stephen E. Frank 0 / 0
Theodore F. Craver, Jr. 183,658 / 0
Bryant C. Danner 348,582 / 0
Alan J. Fohrer 85,764 / 0
Harold B. Ray 0 / 0
Robert G. Foster 0 / 0
John R. Fielder 0 / 0
Stephen E. Pickett 0 / 0
(4) The amount shown represents the proceeds from dividend equivalents related to 48,000 options granted in
1991. The options expired at the end of their ten-year term.
(5) The amount shown represents the proceeds from dividend equivalents related to 60,000 options granted in
1995; 78,800 options granted in 1996; and 78,000 options granted in 1997. The options themselves have not
been exercised. These options will accrue no further dividend equivalents.
(6) The amount shown represents the proceeds from dividend equivalents related to 20,000 options granted in
1992; 18,000 options granted in 1993; 21,400 options granted in 1994; and 40,000 options granted in 1995.
The options themselves have not been exercised. These options will accrue no further dividend equivalents.
(7) The amount shown represents the proceeds from dividend equivalents related to 5,000 options granted in 1991;
15,000 options granted in 1993; 20,300 options granted in 1994; 45,000 options granted in 1995; 36,200
options granted in 1996; and 38,000 options granted in 1997. The options granted in 1991 expired at the end
of their ten-year term. The options granted in the other years have not been exercised. These options will
accrue no further dividend equivalents.
Page 23
LONG-TERM INCENTIVE PLAN
AWARDS IN LAST FISCAL YEAR
The following table presents information regarding Edison International performance shares,(1)
retention incentives,(2) and deferred stock units(3) granted during 2001 to the Named Officers.
Estimated Future Payouts Under
Non-Stock Price-Based Plans
---------------------------
(a) (b) (c) (d) (e) (f)
--- --- --- --- --- ---
Performance
Number of or Other Period
Shares, Until
Units or Other Maturation
Name Rights(1) (2)V Or Payout Threshold Target Maximum
---- -------------- --------- --------- ------ -------
(#) ($) ($) ($)
John E. Bryson
Performance Shares 35,820 Units 3 years N/A N/A N/A
Retention Incentives 61,890 Units 2 years N/A N/A N/A
Deferred Stock Units 429,688 Units 4 years N/A N/A N/A
Stephen E. Frank
Performance Shares 14,667 Units 3 years N/A N/A N/A
Retention Incentives 25,323 Units 2 years N/A N/A N/A
Deferred Stock Units 107,048 Units 4 years N/A N/A N/A
Theodore F. Craver, Jr.
Performance Shares 13,115 Units 3 years N/A N/A N/A
Retention Incentives 23,088 Units 2 years N/A N/A N/A
Deferred Stock Units 81,877 Units 4 years N/A N/A N/A
Bryant C. Danner
Performance Shares 13,115 Units 3 years N/A N/A N/A
Retention Incentives 23,010 Units 2 years N/A N/A N/A
Deferred Stock Units 94,649 Units 4 years N/A N/A N/A
Alan J. Fohrer
Performance Shares 13,115 Units 3 years N/A N/A N/A
Retention Incentives 26,541 Units 2 years N/A N/A N/A
Deferred Stock Units 168,134 Units 4 years N/A N/A N/A
Harold B. Ray
Performance Shares 8,197 Units 3 years N/A N/A N/A
Retention Incentives 18,170 Units 2 years N/A N/A N/A
Deferred Stock Units 57,007 Units 4 years N/A N/A N/A
Robert G. Foster
Performance Shares 6,558 Units 3 years N/A N/A N/A
Retention Incentives 14,782 Units 2 years N/A N/A N/A
Deferred Stock Units 43,054 Units 4 years N/A N/A N/A
John R. Fielder
Performance Shares 4,263 Units 3 years N/A N/A N/A
Retention Incentives 10,743 Units 2 years N/A N/A N/A
Deferred Stock Units 34,452 Units 4 years N/A N/A N/A
Stephen E. Pickett
Performance Shares 3,935 Units 3 years N/A N/A N/A
Retention Incentives 11,199 Units 2 years N/A N/A N/A
Deferred Stock Units 32,488 Units 4 years N/A N/A N/A
Page 24
(1) Twenty-five percent of each Named Officer's annual long-term incentive compensation for 2001 was awarded in
the form of Edison International performance shares. The remaining portion of the Named Officer's long-term
compensation for 2001 was awarded in the form of Edison International stock options as part of a special
grant in May 2000. No Edison International stock options were granted to the Named Officers in 2001.
Performance Shares are stock-based units with each unit worth one share of Edison International Common
Stock. No dividend equivalents were included with these grants. The Performance Shares cannot be voted or
sold. One-half of the Performance Shares will be paid in Edison International Common Stock under the Equity
Compensation Plan, and one-half will be paid in cash equal to the value of such stock outside of the plan.
The payment will be based on the closing value of Edison International Common Stock on December 31, 2003, if
the Named Officer remains employed by the Companies on that date. In the event of retirement, death,
disability, or involuntary severance without cause, pro rata payments will be made on or after December 31,
2003. No payment will be made in the event of a voluntary separation or a separation for cause.
Performance Share payments will also be made in cash in the event of a change in control of Edison
International. The Performance Shares are not transferable, but a beneficiary may be designated in the
event of death. Edison International will substitute cash awards to the extent necessary to pay required
tax withholding, and has reserved the right to substitute cash awards substantially equivalent in value to
the Performance Shares.
(2) Retention Incentives were also awarded to the Named Officers during 2001. The Retention Incentives are
stock units with each unit worth one share of Edison International Common Stock. No dividend equivalents
were included with these grants. The Retention Incentives cannot be voted or sold. They are payable on the
earlier of (i) March 12, 2003, or (ii) the date the average closing price for a share of Edison
International Common Stock for at least 20 consecutive trading days has equaled or exceeded $20, but no
earlier than March 12, 2002.
The Retention Incentives will be paid to the Named Officers in Edison International Common Stock under the
Equity Compensation Plan. Payments will be made upon retirement, death, disability, or involuntary
severance without cause, but no payment will be made in the event of a voluntary separation or a separation
for cause. Retention Incentive payments will also be made in cash in the event of a change in control of
Edison International. The Retention Incentives are not transferable, but a beneficiary may be designated in
the event of death. Edison International will substitute cash awards to the extent necessary to pay
required tax withholding, and has reserved the right to substitute cash awards substantially equivalent in
value to the Retention Incentives.
(3) As stated in footnote (2) to the table above entitled "Aggregated Option / SAR Exercises in 2001 and FY-End
Option / SAR Values," Deferred Stock Units were awarded to the Named Officers during 2001 to the extent they
accepted the terms of an exchange offer made to all active employees holding Edison International stock
options issued during 2000. The terms of the exchange offer provided that one Deferred Stock Unit would be
awarded in exchange for from 2.6 to 3.4 stock options, depending on the Black-Scholes value of the
surrendered options. Each Deferred Stock Unit is worth one share of Edison International Common Stock. No
dividend equivalents were included with these grants. The Deferred Stock Units cannot be voted or sold.
The Deferred Stock Units vest in 25% annual installments and will be paid on each of the following dates,
November 29th of 2002, 2003, 2004 and 2005, if the individual remains employed by the Companies on that date.
Page 25
The Deferred Stock Units will be paid in Edison International Common Stock under the Equity Compensation
Plan. Pro rata payments will be made on the scheduled payment date in the event of a participant's
retirement, death, disability, or involuntary severance without cause during the related vesting period. No
subsequent payment will be made in the event of a participant's voluntary separation or a separation for
cause. Payments will also be made in cash in the event of a change in control of Edison International. The
Deferred Stock Units are not transferable, but a beneficiary may be designated in the event of death.
Edison International will substitute cash awards to the extent necessary to pay required tax withholding,
and has reserved the right to substitute cash awards substantially equivalent in value to the Deferred Stock
Units.
PENSION PLAN TABLE (#)(1)
The following table presents estimated gross annual benefits(2) payable upon retirement at age 65 to the
Named Officers in the remuneration and years of service classifications indicated.
Years of Service
----------------
Annual
Remuneration 10 15 20 25 30 35 40
------------ -- -- -- -- -- -- --
200,000 50,000 67,500 85,000 102,500 120,000 130,000 140,000
400,000 100,000 135,000 170,000 205,000 240,000 260,000 280,000
600,000 150,000 202,500 255,000 307,500 360,000 390,000 420,000
800,000 200,000 270,000 340,000 410,000 480,000 520,000 560,000
1,000,000 250,000 337,500 425,000 512,500 600,000 650,000 700,000
1,200,000 300,000 405,000 510,000 615,000 720,000 780,000 840,000
1,400,000 350,000 472,500 595,000 717,500 840,000 910,000 980,000
1,600,000 400,000 540,000 680,000 820,000 960,000 1,040,000 1,120,000
1,800,000 450,000 607,500 765,000 922,500 1,080,000 1,170,000 1,260,000
2,000,000 500,000 675,000 850,000 1,025,000 1,200,000 1,300,000 1,400,000
2,200,000 550,000 742,500 935,000 1,127,500 1,320,000 1,430,000 1,540,000
2,400,000 600,000 810,000 1,020,000 1,230,000 1,440,000 1,560,000 1,680,000
2,600,000 650,000 877,500 1,105,000 1,332,500 1,560,000 1,690,000 1,820,000
2,800,000 700,000 945,000 1,190,000 1,435,000 1,680,000 1,820,000 1,960,000
3,000,000 750,000 1,012,500 1,275,000 1,537,500 1,800,000 1,950,000 2,100,000
(1) The annual pension benefit estimates are based on the terms of the SCE Retirement Plan, a qualified defined
benefit employee retirement plan, and the SCE Executive Retirement Plan, a nonqualified supplemental
executive retirement plan, with the following assumptions: (i) SCE's qualified retirement plan will be
maintained, (ii) optional forms of payment which reduce benefit amounts have not been selected, and (iii)
any benefits in excess of limits contained in the Internal Revenue Code of 1986 and any incremental
retirement benefits attributable to consideration of the annual incentive will be paid out of the Executive
Retirement Plan as unsecured obligations of Edison International or the participating affiliate. For
purposes of the Executive Retirement Plan, as of December 31, 2001, Mr. Bryson had completed 17 years of
service, Mr. Frank - 14 years, Mr. Craver - 5 years, Mr. Danner - 19 years, Mr. Fohrer - 28 years,
Mr. Ray - 31 years, Mr. Foster - 17 years, Mr. Fielder - 31 years, and Mr. Pickett - 25 years.
Page 26
(2) The retirement benefit of the Named Officers at normal retirement age (65 years) is determined by a
percentage of the executive's highest 36 consecutive months of salary and annual incentive prior to
attaining age 65. Compensation used to calculate combined benefits under the plans is based on base salary
and annual incentive (excluding special recognition awards) as reported in the table above entitled "Summary
Compensation Table," except the Compensation and Executive Personnel Committee elected to adjust the amounts
reported in that table to include foregone 2000 target annual incentives and foregone 2001 salary merit
increases for purposes of the pension benefit determination under the Executive Retirement Plan. The
adjustment amounts for 2000 for this purpose are $760,000, $431,900, $262,500, $336,420, $339,500, $253,500,
$181,500, $149,875, and $137,500 for Messrs. Bryson, Frank, Craver, Danner, Fohrer, Ray, Foster, Fielder,
and Pickett, respectively. For 2001, the adjustment amounts are 0, 0, $65,000, $24,400, 0, $20,000,
$25,000, $13,500, and $25,000, respectively.
The service percentage is based on 1 3/4% per year for the first 30 years of service (52 1/2% upon completion of
30 years of service) and 1% for each year in excess of 30. Named Officers receive an additional service
percentage of3/4% per year for the first ten years of service (7.5% upon completion of ten years of
service). The actual benefit is offset by up to 40% of the executive's primary Social Security benefits.
The normal form of benefit is a life annuity with a 50% survivor benefit following the death of the
participant. Retirement benefits are reduced for retirement prior to age 61. The amounts shown in the
Pension Plan Table above do not reflect reductions in retirement benefits due to the Social Security offset
or early retirement.
Messrs. Danner and Fohrer have elected to retain coverage under a prior benefit program. This program
provided, among other benefits, the post-retirement benefits discussed in the following section. The
retirement benefits provided under the prior program are less than the benefits shown in the Pension Plan
Table in that they do not include the additional 7.5% service percentage. To determine these reduced
benefits, multiply the dollar amounts shown in each column by the following factors: 10 years of service -
70%, 15 years - 78%, 20 years - 82%, 25 years - 85%, 30 years - 88%, 35 years - 88%, and 40 years - 89%.
OTHER RETIREMENT BENEFITS
Additional post-retirement benefits are provided pursuant to the Survivor Income Continuation Plan and the
Survivor Income/Retirement Income Plan under the Executive Supplemental Benefit Program. For purposes of
determining the estimated annual benefits payable under these plans upon retirement at normal retirement age for
each of the Named Officers, which is dependent upon final compensation, the highest compensation level in the
Pension Plan Table above ($3,000,000) has been used in the examples which follow.
The Survivor Income Continuation Plan provides a post-retirement survivor benefit payable to the beneficiary
of the participant following his or her death. The benefit is approximately 23% of final compensation (salary at
retirement and the average of the three highest annual incentives paid in the five years prior to retirement)
payable for ten years certain. If a Named Officer's final annual compensation were $3,000,000, the beneficiary's
estimated annual survivor benefit would be $673,500. Messrs. Danner and Fohrer have elected coverage under this
plan.
Page 27
The Supplemental Survivor Income/Retirement Income Plan provides a post-retirement survivor benefit payable
to the beneficiary of the Named Officer following his or her death. The benefit is 25% of final compensation
(salary at retirement and the average of the three highest annual incentives paid in the five years prior to
retirement) payable for ten years certain. At retirement, a Named Officer has the right to elect the retirement
income benefit in lieu of the survivor income benefit. The retirement income benefit is 10% of final
compensation (salary at retirement and the average of the three highest annual incentives paid in the five years
prior to retirement) payable to the participant for ten years certain immediately following retirement. If a
Named Officer's final annual compensation were $3,000,000, the beneficiary's estimated annual survivor benefit
would be $750,000. If a Named Officer were to elect the retirement income benefit in lieu of the survivor income
benefit and had final annual compensation of $3,000,000, the Named Officer's estimated annual benefit would be
$300,000. Messrs. Danner and Fohrer have elected coverage under this plan.
The 1985 Deferred Compensation Plan provides a post-retirement survivor benefit. This plan allowed eligible
participants in September 1985 to voluntarily elect to defer until retirement a portion of annual salary and
annual incentives otherwise earned and payable for the period October 1985 through January 1990. Messrs. Bryson
and Ray participate in this plan. The post-retirement survivor benefit is 50% of the annual amount the
participant had been receiving from the plan. Survivor benefit payments begin following completion of the
deferred compensation payments. If the named beneficiary is the executive's spouse, then survivor benefits are
paid as a life annuity, five years certain. The benefit amount will be reduced actuarially if the spouse is more
than five years younger than the executive at the time of the executive's death. If the beneficiary is not the
spouse, then benefits are paid for five years only. The annual amounts which would be payable to the surviving
beneficiaries of Messrs. Bryson and Ray if each retired at age 65 are $1,260,020 and $46,324, respectively.
Messrs. Bryson and Frank are entitled to benefits accrued under the Retirement Plan for Directors before it
was terminated in 1997. Each will be entitled to an annual retirement benefit in the amount of the annual
retainer for the number of years they served on the Boards prior to 1998 (and meeting fees for years prior to
1996). Mr. Bryson will receive $7,938 per quarter for eight years following his retirement from the Edison
International Board, and Mr. Frank will receive $7,000 per quarter for three years following his retirement from
the Boards.
EMPLOYMENT CONTRACTS AND
TERMINATION OF EMPLOYMENT ARRANGEMENTS
Stephen E. Frank. Mr. Frank executed an employment agreement when he joined SCE as President and Chief
Operating Officer and joined the Boards of Directors in 1995. For purposes of the Executive Retirement Plan, he
was credited with 1.25 years of additional service for each year of actual service up to ten years. A deferred
compensation plan account was established and credited with $250,000 which vested when Mr. Frank completed five
years of service. He was also provided two club memberships along with regular executive and employee benefits.
If Mr. Frank's employment had been terminated involuntarily (other than for cause), he would have received a
severance payment equal to one year's salary plus annual incentive.
During 2001, Mr. Frank executed a Retirement Agreement and a Consulting Agreement with SCE. Mr. Frank
resigned as an officer and director of SCE and as a director of Edison International effective January 1, 2002,
and retired as an employee of SCE on March 14, 2002. Pursuant to the terms of the Retirement Agreement,
Mr. Frank's 2001 annual incentive was the higher of his target percentage
page 28
(70% of salary) or the average percent of target awarded to officers at a level of senior vice president or
above. He will not receive an annual incentive for his 2002 service. SCE will pay Mr. Frank's healthcare COBRA
premiums until he reaches age 65 and will pay him a $100,000 lump sum net of tax to defer the cost of
supplemental insurance coverage after age 65. His Edison International stock options issued before 2000 and his
2000 and 2001 performance shares will be fully vested, and his deferred stock units received from the stock
option exchange offer will be 75% vested. The performance shares and deferred stock units will be paid on the
regularly scheduled payment dates. Mr. Frank's company car was transferred to him upon his retirement.
The terms of the Consulting Agreement provide for a three-year term with annual retainers of $200,000 for
the first two years and $100,000 for the third year. Mr. Frank will be paid for any consulting services agreed
to in excess of 20 hours per month during the first two years or 10 hours per month during the third year at a
rate of $150 per hour.
Bryant C. Danner. Mr. Danner executed an employment agreement when he joined Edison International and SCE
as Senior Vice President and General Counsel in 1992. After completing three years of service, he was credited
with ten additional years of service with SCE and Edison International for purposes of determining benefits under
the Executive Retirement Plan. Edison International and SCE agreed to use their best efforts to make available
health care coverage until Mr. Danner and his spouse reach age 65, with the Companies bearing the cost over the
amount an SCE retiree would pay for coverage in the SCE group plan with the highest deductible. Mr. Danner
resigned his SCE positions effective January 1, 2001.
COMPENSATION AND EXECUTIVE PERSONNEL COMMITTEES'
REPORT ON EXECUTIVE COMPENSATION(1)
The Edison International and SCE Compensation and Executive Personnel Committees are each composed of the
same non-employee directors named at the end of this report. The Committees have responsibility for all
executive compensation programs of the Companies and met jointly to consider executive compensation matters for
2001.
The Edison International Committee determines salaries and annual incentives for Edison International
officers. The SCE Committee determines salaries and annual incentives for SCE officers. The salaries and annual
incentives of the officers of the other Edison International subsidiaries are determined by their respective
boards of directors subject to review and approval of the Edison International Committee to ensure consistency
with overall Edison International compensation policies. In addition, the Edison International Committee
administers the Equity Compensation Plan and the 2000 Equity Plan pursuant to which long-term incentives were
awarded in 2001.
__________________
(1) SEC filings sometimes "incorporate information by reference." This means the filing company is referring
you to information that has previously been filed with the SEC, and that the information should be
considered as part of the filing you are reading. Unless Edison International or SCE specifically states
otherwise, this report shall not be deemed to be incorporated by reference and shall not constitute
soliciting material or otherwise be considered filed under the Securities Act of 1933 or the Securities
Exchange Act.
Page 29
Compensation Policies
The executive compensation programs of Edison International, SCE and the other subsidiaries are intended to
achieve three fundamental objectives: (1) attract and retain qualified executives; (2) motivate performance to
achieve specific strategic objectives of the Companies; and (3) align the interests of senior management with the
long-term interests of the Companies' shareholders and for SCE, its ratepayers. At present, the basic components
of the Companies' executive compensation program are base salaries, annual incentives, and long-term incentives.
The Companies also provide broad-based employee benefit plans and certain other executive benefit plans.
Section 162(m) of the Internal Revenue Code of 1986 generally disallows a tax deduction to public companies
for compensation over $1,000,000 paid to their chief executive officers and the four other most highly
compensated executive officers unless certain tests are met. The Committees' general intent is to design and
administer the Edison International and SCE compensation programs in a manner that will preserve the
deductibility of compensation payments to Executive Officers. However, this goal is secondary in importance to
achievement of the Companies' compensation objectives discussed above. The Committees believe that the potential
increased tax liability is of insufficient magnitude to warrant alteration of the present compensation system
which is achieving the desired compensation objectives while retaining the flexibility of the Committees to
exercise judgment in assessing an executive's performance.
2001 Compensation Objectives
The Committees base their compensation actions for the Companies on data gathered through independent
surveys of peer group companies. Independent compensation consultants are retained to annually review and
identify the appropriate comparison companies and to obtain and evaluate current executive compensation data for
Edison International, SCE and the other subsidiaries of Edison International. The Committees identified 13
deregulating, diversified electric utilities for Edison International compensation comparisons for 2001. The
peer group of companies was the same as the peer group used for the prior year. The comparison utility companies
were selected on the basis of total assets and net sales. Although the peer groups differ from the Dow Jones
U.S. Electric Utilities Index depicted in the Stock Performance Graph, all of the companies comprising the peer
groups are included in the index, and the Committees believe the constitution of the peer groups provides
relevant compensation data for Edison International and SCE in view of their changing business environment. The
compensation consultant reviews the data, along with position-specific survey information collated from a variety
of more general sources, to develop a recommended structure of salary ranges, short-term incentive targets, and
long-term incentive targets. Selecting peer groups for the other subsidiaries was accomplished by a similar
process geared to identify appropriate comparison companies in their respective industries.
The Compensation Committees' strategy for 2001 compensation planning was established in December 2000 to
generally target fixed compensation (salary and benefits) for Edison International, SCE and the other
subsidiaries at the median level of their respective peer groups. Target annual incentive and long-term
incentive opportunities were also set at the median level of the peer groups, with maximum annual award
opportunities of 200% of target levels for significant performance exceeding target levels. The Compensation
Committees may deviate above and below established targets in individual cases as deemed appropriate in their
discretion.
Page 30
Base Salaries
The Committees reviewed the base salaries for Mr. Bryson, Mr. Frank and the other Executive Officers at the
end of 2000 to set salaries for 2001. The financial effects of the California energy crisis overshadowed all
other aspects of Company and individual performance. Notwithstanding the Companies' strong operating performance
in many areas during 2000, the Committees determined that no merit salary increase would be approved for Mr.
Bryson, Mr. Frank or the other Executive Officers at Edison International and SCE for 2001.
Mr. Bryson's 2001 salary remained at $950,000, which was 4% below the average for CEOs in the peer group.
Mr. Frank's 2001 salary remained at $617,000, which was 10% below his peers. The 2001 base salaries for the
other Executive Officers at Edison International and SCE remained at 2000 levels.
In December 2000, the Edison International Committee also reviewed the base salaries of the Executive
Officers at the other subsidiaries. The 2001 base salaries in the aggregate of the Executive Officers at Edison
International, SCE and the other subsidiaries are 2% below the median levels of their respective peer groups.
Annual Incentive Compensation for 2001 Performance
Annual incentive compensation is determined on the basis of overall corporate performance and the
Committees' assessment of the individual Executive Officer's performance. Target annual incentives for Executive
Officers for 2001 ranged from 30% of base salary for certain subsidiary vice presidents to 70% of base salary for
Mr. Frank and 80% of base salary for Mr. Bryson. Maximum opportunity levels were set at 200% of target award
levels. Awards are made in the judgment of the Committees taking into account overall Company results as guided
by the relevant performance objectives for the year.
Performance objectives for the Edison International companies were discussed with the Boards in early 2001,
but it was evident then that establishing specific 2001 goals for the companies (as had been done in prior years)
would be extremely difficult in light of the unprecedented and unpredictable impacts of the California energy
crisis. Three general areas of achievement were identified as SCE objectives for 2001: (1) restoring financial
health (weighted at 50%), (2) operational excellence (25%) and (3) financial performance (25%). Goals related to
restoration of SCE's financial health included recovery of past and future procurement costs, restoring SCE's
creditworthiness and securing fair returns on utility investments. Operational excellence goals for SCE focused
on several key objectives including customer satisfaction, service reliability, and operational safety. No
specific "dollar targets" were identified related to SCE's financial performance due to the uncertainties of the
California energy crisis.
Weighted objectives were identified for Edison Mission Energy. However, relatively more uncertainties
resulting from the California energy crisis were anticipated for Edison Capital than for Edison Mission Energy,
so specific achievement objectives were not identified for Edison Capital. Similarly, specific achievement
objectives were not identified at the beginning of the year for Edison International because its results would be
dependent on operating company results, all of which, in turn, were highly unpredictable in light of the
California situation.
Therefore, at the outset of 2001, the Committees recognized that their year-end determinations on annual
incentive awards for 2001 would call for exercising a high degree of discretion and judgment in evaluating actual
results. When the Committees met in February 2002 to evaluate each Company's performance and to determine 2001
annual incentives awards, the Committees reviewed the year's
page 31
overall performance in light of the challenges resulting from the California power crisis and the objectives
identified at the beginning of the year.
The Committees concluded that the perseverance and dedication of the SCE and Edison International leadership
groups in guiding SCE through the crisis to achieve the ultimate CPUC settlement was a singular, positive
achievement that establishes a solid foundation for a stronger utility business in the future. The Committees
determined that Edison International, Edison Mission Energy and Edison Capital managed necessary refinancings in
a very difficult market and successfully implemented cost cutting, restructuring and cash preservation measures.
The Committees also determined that, although SCE's core earnings had declined from 2000 levels and were
adversely impacted by an extended, fire-caused outage at one of the SONGS nuclear units, SCE operations had
achieved high ratings in reliability, customer satisfaction and safety.
Edison Mission Energy did not achieve its financial or growth targets in 2001, and incurred a substantial
loss in the sale of its Fiddler's Ferry and Ferrybridge assets in the United Kingdom. However, in the
Committees' judgment, it was able to accomplish important restructurings and sales (including the sale of the
Fiddler's Ferry and Ferrybridge assets), and maintained its investment grade credit rating in the face of
difficult challenges. Edison Mission Energy's success in bringing a new California power plant (the "Sunrise"
project) into operation in record time was one of Edison International's key contributions to resolving the
California power crisis. Edison Mission Energy's management of a difficult strike situation in Illinois and the
negotiation of a new long-term power contract for the Paiton project in Indonesia were also considered by the
Committees to be noteworthy achievements. In respect to Edison Capital, the Edison International Committee
concluded that the company had responded quickly and effectively to mitigate the adverse financial impact of the
California power crisis on the company.
The Edison International Committee approved a 2001 annual incentive award of $1,350,000 for Mr. Bryson that
was 89% of his maximum potential award. The SCE Committee approved a 2001 annual incentive award of $585,000 for
Mr. Frank that was 68% of his maximum potential award. In addition to evaluating the overall performance of Mr.
Bryson as measured by the Companies' results discussed above, the Edison International Compensation Committee's
subjective assessment of his performance was considered. Factors found to be particularly significant in 2001
for Mr. Bryson were his solid and focused leadership in guiding the Companies through the California power
crisis, his successful efforts in keeping the management team in place and his effectiveness in communicating
Company objectives to policy makers, shareholders, employees and customers. Mr. Frank's award reflected his
excellent leadership during the California power crisis and was based on the average percentage of target awarded
to other senior executives at SCE as provided in the terms of his retirement agreement discussed above under
"Employment Contracts and Termination of Employment Arrangements."
The 2001 annual incentives for the other Executive Officers averaged 69% of maximum at Edison International,
67% of maximum at SCE and 41% of maximum at the other subsidiaries. The target values established and the actual
awards granted to Mr. Bryson, Mr. Frank and the other Executive Officers were consistent with the Compensation
Committees' strategy described above.
Long-Term Incentives
In recent years, the long-term incentives awarded to Executive Officers have had two components.
Nonqualified Edison International Common Stock options comprised 75% of the award value and
Page 32
performance shares comprised 25% of the value. However, as reported last year, a special stock option award was
made during 2000 in lieu of the anticipated level of options that would have been scheduled for issuance in 2001
and 2002. Because of that, no additional options were granted to the Executive Officers during 2001. The Edison
International Committee awarded 35,820 performance shares to Mr. Bryson and 14,667 performance shares to
Mr. Frank in January 2001. The target values established and the actual awards granted to Mr. Bryson, Mr. Frank
and the other Executive Officers were consistent with the Committees' strategy described above and reflect the
Committees' commitment to link a significant portion of the compensation of Mr. Bryson and Mr. Frank directly to
the value provided to shareholders by Edison International stock. The awards were granted to Executive Officers
in the judgment of the Edison International Compensation Committee guided by the survey results as to the target
award percentages described above and were not formula-driven. The number and value of options granted in prior
years was not a factor in the current year award determination.
Retention Measures
The extraordinary challenges facing the Companies as a result of the California energy crisis caused the
Edison International Committee to focus on retention of the management team at SCE and throughout Edison
International. During 2001, the Edison International Committee awarded retention incentives in the form of
deferred stock units to the Executive Officers that will pay out if an executive remains actively employed
through the performance period, or upon death, disability or retirement. Mr. Bryson was awarded 61,890 retention
incentives. Mr. Frank was awarded 25,323 retention incentives.
In October 2001, the Edison International Committee concluded that as a result of the California energy
crisis and the ensuing financial effects on the Companies, the 2000 stock option grants no longer conveyed the
incentives that were originally intended. The Committee determined that it is important to provide long-term
incentives that will encourage the continued dedication of managers and executives of the Companies and align
their interests with those of the shareholders. Accordingly, it was determined to offer deferred stock units
that would vest over a four-year period in exchange for the outstanding 2000 stock options based on Black-Scholes
valuations of the stock options. The voluntary exchange offer was completed in November 2001. Regular option
grants will resume in mid-2002.
Summary
The Committees' compensation actions for 2001 reflect the continued volatility of the energy industry and
the Companies' performance in 2001. No salary merit increases for 2001 were approved for the Executive Officers
at Edison International and SCE. However, the sustained effort during the year at every Edison International
company that produced a path to financial recovery was recognized by the Committees through the annual incentive
award process.
The members of the Committees believe that the compensation programs of the Companies are effective in
attracting and retaining qualified executives to lead the Companies. A significant portion of Executive Officer
compensation is directly linked to shareholder value. The Committees will continue to monitor closely the
effectiveness and appropriateness of each of the components of compensation to reflect changes in the business
environment of the Companies.
Page 33
Compensation and Executive Personnel Committees of the Edison
International and SCE
Boards of Directors*
--------------------
Robert H. Smith (Chair) Charles D. Miller
Luis G. Nogales James M. Rosser
Thomas C. Sutton
* Dr. Zapanta served as a member of the Committees for part of 2001, but ceased to be a Committee member on
July 19, 2001, and a Board member on October 31, 2001. He did not participate in decisions of the
Committees from June 2001 after becoming incapacitated, including deliberations regarding the stock option
exchange offer and the determination of annual incentives for 2001 performance.
COMPENSATION AND EXECUTIVE PERSONNEL COMMITTEES'
INTERLOCKS AND INSIDER PARTICIPATION
Dr. Zapanta ceased to be a member of the Compensation Committees on July 19, 2001. The other Compensation
Committees members whose names appear on the Committees' Report above were members of the Compensation Committees
during all of 2001. During 2001, Messrs. Danner and Craver served as directors of Edison Mission Energy and
Edison Capital, both nonutility subsidiaries of Edison International. Mr. Bryson is Chairman of the Board of
both subsidiaries, but his compensation is determined by the Edison International Compensation Committee, not the
subsidiaries' boards. Under applicable SEC rules, there were no other interlocks or insider participation on the
Compensation Committees.
CERTAIN RELATIONSHIPS AND TRANSACTIONS
Mr. Olson is a Senior Partner of the law firm of Munger, Tolles and Olson which provided legal services to
Edison International, SCE, and/or their subsidiaries in 2001. Such services are expected to continue to be
provided in the future. Edison International and its subsidiaries paid Munger, Tolles and Olson an aggregate
amount of $11,354,870 in 2001 for legal services.
In 2001 to date, Deloitte Consulting Services, LLC, has provided various consulting services to Edison
International and SCE, and such services are expected to continue to be provided in the future. Mr. John Danner,
brother of Bryant C. Danner, provided consulting services on an Edison International project pursuant to a
retainer consulting agreement with Deloitte. The aggregate amount paid by Edison International for that project
in 2001 to date was $1,408,365; and, Mr. Danner received an aggregate amount of $261,750 for consulting services
provided for the project.
Edison International, SCE, and Edison Mission Midwest Holdings Co., an indirect nonutility subsidiary of
Edison International, have maintained credit facilities under which certain affiliated companies of J. P. Morgan
Chase & Company (collectively, "JPMorgan"), the beneficial owner of 5.6% of Edison International's Common Stock,
acted as administrative agents and participated as lenders. Under a syndicated credit facility for Edison
International, JPMorgan provided loans of approximately $149 million that were repaid during 2001. That credit
facility has been terminated. Under syndicated and bilateral credit agreements, JPMorgan provided loans of
approximately
Page 34
$530 million to SCE that were repaid in 2002 and replaced with new credit facilities under which JPMorgan has
provided loans of approximately $197 million which are currently outstanding. Under a credit agreement with
Edison Mission Midwest, JPMorgan provided loans of approximately $1.8 million, of which $1.7 million is currently
outstanding. In connection with the various credit facilities, Edison International and SCE paid JPMorgan an
aggregate of $8,816,683 in commitment fees, arrangement fees, and consent fees during 2001 and 2002, and Edison
Mission Midwest paid JPMorgan an aggregate of $5,406,930 in facility fees in 2001 and 2002, and pays $50,000
annually in agency fees. A portion of those fees may have been distributed by JPMorgan to other agents and
syndicate lenders under the credit facilities. On an unrelated matter, JPMorgan received $500,000 in fees for
facilitating the sale of a substantial portion of the business of Edison Source, an Edison International
nonutility subsidiary, during 2001.
Edison International and SCE believe that any transactions described above are comparable to those which
would have been undertaken under similar circumstances with nonaffiliated entities or persons.
OTHER MANAGEMENT TRANSACTIONS
During 1997, Edison International loaned Robert G. Foster $160,000 interest-free in connection with his
purchase of a principal residence following his relocation from SCE's Sacramento Region Office to the Southern
California Metropolitan area. Under the terms of the loan, one-seventh of the original principal amount was
forgiven in 1997, and one-seventh will be forgiven each year thereafter if Mr. Foster remains employed with an
Edison International affiliate. As of February 28, 2002, a principal balance of $22,857 remained outstanding.
If Mr. Foster's employment terminates before the end of the loan term, the remaining principal balance owing will
be due and payable. Interest will accrue on any remaining principal balance at the Bank of America Prime
Interest Rate after 90 days.
CERTAIN LEGAL PROCEEDINGS
In October 2000 and March 2001, two purported class action lawsuits were filed in federal district court in
Los Angeles, California against Edison International and SCE and certain of their officers, including Messrs.
Bryson and Craver, and Thomas M. Noonan, Vice President and Controller of Edison International and SCE. The
actions involve securities fraud claims arising from alleged improper accounting by Edison International and SCE
for undercollections in SCE's Transition Revenue Account, or TRA undercollections. On August 3, 2001, the
plaintiffs filed a consolidated complaint on behalf of alleged shareholders of Edison International. The
consolidated complaint alleges that the defendants engaged in securities fraud by misrepresenting and/or failing
to disclose material facts concerning the financial condition of Edison International and SCE, including that the
defendants allegedly overreported income and improperly accounted for the TRA undercollections. The TRA is a
California Public Utilities Commission-authorized regulatory asset account in which SCE records the difference
between the revenues received from customers through currently frozen rates and the costs of providing service to
customers, including power procurement costs. The complaint purports to be filed on behalf of a class of persons
who purchased Edison International stock between July 21, 2000, and April 17, 2001. Plaintiffs seek damages, in
an unstated amount, in connection with their purchase of securities during the class period. On September 17,
2001, the defendants filed a motion to dismiss for failure to state a claim. On March 8, 2002, the court issued
an order granting the motion and dismissing the complaint with prejudice as to all defendants. Plaintiffs could
appeal this ruling to the Ninth Circuit Court of Appeals.
Page 35
FIVE-YEAR STOCK PERFORMANCE GRAPH(1) (2)
The graph below compares the annual change in the cumulative total shareholder return on the Edison
International Common Stock with the cumulative total return of companies in the Standard and Poor's 500 Stock
Index and the Dow Jones U.S. Electric Utilities Index (also known as the Dow Jones U.S. Total Market Electric
Utilities Index).(3) The S&P 500 Index is published daily in The Wall Street Journal. The Dow Jones U.S.
Electric Utilities Index contains 66(4) United States investor-owned power companies and is published daily by
Dow Jones & Company. Edison International is included in both the S&P 500 Index and the Dow Jones U.S. Electric
Utilities Index.
Cumulative Total Return
-----------------------
12/96 12/97 12/98 12/99 12/00 12/01
----- ----- ----- ----- ----- -----
Edison International 100.00 142.43 151.53 147.13 92.72 89.60
Standard & Poor's 500 Index 100.00 133.36 171.47 207.56 188.66 166.24
Dow Jones U.S. Electric Utilities Index 100.00 128.98 148.22 126.42 200.05 158.79
---------------
(1) SEC filings sometimes "incorporate information by reference." This means the Companies are referring you to
information that has previously been filed with the SEC, and that this information
Page 36
should be considered as part of the filing you are reading. Unless Edison International or SCE specifically
states otherwise, this graph shall not be deemed to be incorporated by reference and shall not constitute
soliciting material or otherwise be considered filed under the Securities Act or the Securities Exchange Act.
(2) The historical stock performance depicted on the graph is not necessarily indicative of future performance.
The Companies do not make or endorse any predictions as to future stock performance or dividends. The
quarterly dividends customarily paid on January 31, April 30, July 31, and October 31 were not declared for
2001 and the quarterly dividends customarily paid on January 31 were not declared for 2002 by the Edison
International Board. This proxy statement is not to be considered material for soliciting the purchase or
sale of either Companies' stock.
(3) In February 2000, Dow Jones launched a new U.S. Equity Index series which replaced all of its prior index
series including the Dow Jones Electric Utilities Index previously used for this graph. The new series
covers 95% of the U.S. equity market and replaces the previous series that covered 80% of the equity
market. Additionally, the industry classification system was restructured. The net result of these changes
is that all U.S. indices will show differences when compared to the indices used prior to 2000.
(4) As of December 31, 2001.
(5) Ex-dividend dates have been used to determine the number of dividends included in Edison International's
cumulative total return calculation. The ex-dividend date occurs a few days prior to the record date for
each dividend payment, and is the date on which the stock begins trading at a price that does not include
the dividend. Edison International had three ex-dividend dates in 1999 even though shareholders received
four dividend payments in that year. In 2000, there were four ex-dividend dates and four dividend
payments. For purposes of calculating the adjusted cumulative total return presented in the following
table, four ex-dividend dates were used for each year starting in 1997 through 1999, and three ex-dividend
dates were used in 2000. The adjusted calculation for 2000 includes only three ex-dividend dates since the
Board did not declare the dividend customarily paid on January 31, 2001. As noted in footnote (2) above,
there were no dividends declared by the Edison International Board for each of the four quarters of 2001.
Adjusted Cumulative Total Return
--------------------------------
12/96 12/97 12/98 12/99 12/00 12/01
----- ----- ----- ----- ----- -----
$100.00 $142.43 $151.53 $148.65 $92.67 $89.56
Page 37
AUDIT COMMITTEES' REPORT(1)
The Edison International and SCE Audit Committees have certain duties and powers as described in their
charters. In 2001, the SCE Audit Committee revised its charter which was approved by the SCE Board on
December 13, 2001, and is attached to this Proxy Statement as Appendix A. The Edison International Audit
Committee Charter approved by the Edison International Board on December 14, 2000, remained unchanged. The Audit
Committees are currently composed of the same five non-employee directors named at the end of this report and are
independent as defined by the rules of the stock exchanges on which the Companies are listed.
Management is responsible for the Companies' internal controls and the financial reporting process,
including the integrity and objectivity of the financial statements. The independent accountants are responsible
for performing an independent audit of the Companies' financial statements in accordance with generally accepted
auditing standards and to issue a report thereon. The Committees monitor and oversee these processes. The
Committees' members are not accountants or auditors by profession and, therefore, have relied on certain
representations from management and the independent accountants about the carrying out of their respective
responsibilities.
In connection with the December 31, 2001, financial statements, the Audit Committees:
o reviewed and discussed the audited financial statements with Company management;
o discussed with Arthur Andersen LLP, the Companies' independent public accountants for calendar year
2001, the matters required by Statement on Auditing Standards No. 61 (Communication with Audit
Committees); and
o received the written disclosures required by Independence Standards Board Standard No. 1 (Independence
Discussions with Audit Committees) and discussed with Arthur Andersen its independence from the
Companies.
Based upon these reviews and discussions, the Edison International and SCE Audit Committees recommended to
their respective Boards of Directors that the audited financial statements be included in the Edison
International and SCE 2001 Annual Reports on Form 10-K to be filed with the SEC.
Audit Committees of the
Edison International and SCE
Boards of Directors
-------------------
Daniel M. Tellep (Chair) Robert H. Smith
Carl F. Huntsinger Thomas C. Sutton
Charles D. Miller
---------------------
(1) SEC filings sometimes "incorporate information by reference." This means the Companies are referring you to
information that has previously been filed with the SEC, and that this information should be considered as
part of the filing you are reading. Unless Edison International or SCE specifically states otherwise, this
report shall not be deemed to be incorporated by reference and shall not constitute soliciting material or
otherwise be considered filed under the Securities Act or the Securities Exchange Act.
Page 38
INDEPENDENT PUBLIC ACCOUNTANT FEES
The following table sets forth the aggregate fees billed to Edison International (consolidated total
including Edison International and its subsidiaries) and SCE, respectively, for the fiscal year ended
December 31, 2001, by Arthur Andersen:
Edison International
and
Subsidiaries SCE
($000) ($000)
------ ------
Audit Fees 4,566 1,341
---------------------------------------------------------------------------------------
Financial Information Systems Design
and Implementation Fees 214 --
---------------------------------------------------------------------------------------
All Other Fees:
Tax 3,564 537
Audit-Related 714 210
Advisory:
Support Work Related to the
California Energy Crisis and
California Regulatory Issues 4,838 4,838
Benefit Plan Review 790 --
Other Advisory 1,696 1,084
------- -----
Total All Other Fees 11,602 6,669
---------------------------------------------------------------------------------------
INDEPENDENT PUBLIC ACCOUNTANTS FOR 2002
The Edison International and SCE Boards have selected Arthur Andersen LLP as the Companies' independent
public accountants for calendar year 2002. Arthur Andersen is an international public accounting firm which
provides leadership in public utility accounting matters. The Audit Committees of the Boards of Directors have
considered whether the provision of the non-audit services described above is compatible with maintaining Arthur
Andersen's independence.
Representatives of Arthur Andersen are expected to attend the annual meeting to respond to appropriate
questions and to make a statement if they wish.
SHAREHOLDER PROPOSALS AND NOMINATIONS FOR
2003 ANNUAL MEETINGS
To be considered for inclusion in the 2003 proxy statement, shareholder proposals for the Edison
International and SCE 2003 annual meetings must be received by December 5, 2002.
Shareholders intending to bring any other business before an annual meeting, including Director nominations,
must give written notice to the Edison International or SCE Secretary, as the case may be, of the business to be
presented. The notice must be received at Company offices within the periods, and
Page 39
with the information and documents, specified in the Bylaws. A copy of the Bylaws may be obtained by writing to
the Edison International or SCE Secretary.
Assuming that the 2003 annual meetings of shareholders are held on May 15, 2003, as currently specified by
the Bylaws, the period for the receipt by the Edison International or SCE Secretary of written notice of other
business to be brought by shareholders before the 2003 annual meetings of shareholders, including Director
nominations, will begin on October 7, 2002, and end on December 5, 2002.
AVAILABILITY OF FORM 10-K AND OTHER INFORMATION
The Edison International and SCE 2001 Annual Reports on Form 10-K, including the financial statements and
the financial statement schedules but excluding other exhibits, will be furnished without charge to shareholders
upon written request. These reports are expected to be available for distribution after March 31, 2002.
A copy may be requested by writing to:
Ms. Betty Hutchinson
Law Department, Corporate Governance
Edison International (or SCE, as the case may be)
2244 Walnut Grove Avenue, P. O. Box 800
Rosemead, California 91770
OTHER PROPOSED MATTERS
The Edison International and SCE Boards were not aware by December 20, 2001 (the latest date for
shareholders to provide advance notice of business intended to be presented at the annual meeting) of any other
matters which can properly be presented for action at the annual meeting.
If any other matters should properly come before the annual meeting, including matters incident to the
conduct of the annual meeting, the proxies will vote the shares in accordance with their judgment. Discretionary
authority to do so is included in the proxies.
Dated: April 4, 2002
For the Boards of Directors,
/s/ BEVERLY P. RYDER
BEVERLY P. RYDER, Vice President
and Secretary, Edison International,
Secretary, Southern California Edison Company
Page 40
APPENDIX A
SOUTHERN CALIFORNIA EDISON COMPANY
CHARTER FOR THE AUDIT COMMITTEE OF THE
BOARD OF DIRECTORS
Adopted by the Board of Directors
December 13, 2001
Membership
The Audit Committee ("Committee") of the Board of Directors ("Board") shall consist of not less than four
nor more than seven members of the Board. Each Committee member shall be appointed by the Board and shall serve
until a successor shall be appointed by the Board. The Board shall designate one of the Committee members as
Chair ("Chair") who shall preside over meetings of the Committee and report Committee actions to the Board.
Each member of the Committee shall be (i) independent as determined pursuant to the listing standards of any
stock exchange on which the Company is listed, subject to any exceptions provided in such standards; and
(ii) financially literate as determined by the Board, which shall mean at a minimum able to read and understand
fundamental financial statements including a balance sheet, income statement, and cash flow statement, or become
financially literate within a reasonable time after appointment. At least one member shall have accounting or
related financial management expertise as determined by the Board, which shall mean at a minimum past employment
experience in finance or accounting, requisite professional certification in accounting, or any other comparable
experience or background resulting in the individual's financial sophistication, including being or having been a
chief executive officer, chief financial officer or other senior officer with financial oversight
responsibilities.
Meetings and Other Actions
At least four regular meetings per year shall be held with the Company's independent public accountants, one
of which shall be held at the completion of the annual audit and before the Company's annual financial statements
are published, and three of which shall be scheduled at the direction of the Chair. Additional meetings may be
requested by any Committee member. Regular meetings normally shall be attended by the Company's chief executive
officer, chief financial officer, chief accounting officer, chief legal officer, and chief internal auditor and
representatives of the independent public accountants retained by the Company. The Committee may meet in
executive session at its discretion. Representatives of management, the independent public accountants, and the
chief internal auditor each shall be given the opportunity to meet privately with the Committee.
A majority of the members of the Committee shall constitute a quorum for the transaction of business.
Meetings shall be held at the principal offices of the Company or as directed by the Chair.
The Company's Secretary shall keep, or appoint an appropriate employee of the Company to keep, regular
minutes of all Committee proceedings. The minutes of each meeting shall be reviewed and approved by legal
counsel and the Chair. The approved minutes shall become a permanent corporate record maintained by the
Company's Secretary. A report on the Committee's activities shall be provided to the Board after each meeting.
A-1
Unless otherwise provided in this Charter, the meetings and any other actions of the Committee shall be
governed by the provisions of Article III of the Bylaws of the Company applicable to meetings and actions of the
Board.
Duties and Responsibilities
The Committee shall exercise the following powers and duties at least annually:
1. Recommend to the Board the appointment of the Company's independent public accountants. The Board
and the Committee shall have the ultimate authority and responsibility to select, evaluate and,
where appropriate, replace the independent public accountants, who shall be ultimately accountable
to the Board and the Committee.
2. Ensure that the independent public accountants submit to the Committee a formal written statement
delineating all relationships between such accountants and the Company, including information
required by Independence Standards Board Standard No. 1. Review any disclosed relationships and
the scope of the professional services performed or to be performed by the independent public
accountants as well as the related fees and consider the possible effect that these services could
have on the independence of such accountants. Actively engage in a dialogue with the independent
public accountants with respect to any disclosed relationships or services that may impact the
objectivity and independence of such accountants and recommend to the Board, if necessary, that
appropriate action be taken in response to such accountants' report to satisfy itself of and
otherwise oversee the accountants' independence.
3. Review the independent public accountants' and internal auditors' evaluations of the adequacy of
the Company's internal controls, and the extent to which major recommendations made by the
independent public accountants and the Company's chief internal auditor have been implemented by
management.
4. Review with management the audit plans of the independent public accountants and the Company's
internal auditors in light of current and contemplated business activities.
5. Review with the independent public accountants, upon completion of their audit, the Company's
year-end audited financial statements and related notes, including the matters required to be
discussed by Statement on Auditing Standards No. 61, the results of their examination, any report
or opinion proposed to be rendered in connection therewith and any unresolved disagreements with
management concerning accounting or disclosure matters.
6. Review information provided by management on issues such as litigation and regulatory proceedings,
environmental compliance, health and safety compliance, information technology security, and legal
compliance.
7. Review information provided by the chief internal auditor and management regarding business ethics
monitoring and internal auditing programs.
8. Review and discuss with management the Company's year-end audited financial statements.
A-2
9. Recommend to the Board that the year-end audited financial statements be included in the Company's
Annual Report on Form 10-K.
10. Review and reassess the adequacy of the Committee charter.
11. Provide a report in the Company's proxy statement when required by the Securities and Exchange
Commission.
In addition, the Committee shall exercise the following duties and responsibilities at its discretion:
1. Request the independent public accountants, the Company's chief internal auditor or management to
conduct any reviews or studies considered necessary. As deemed appropriate by the Committee, it
shall direct and supervise an investigation into any matter within the scope of its duties and
responsibilities. In connection with any such investigation, the Committee shall have the
authority to utilize the Company's internal audit staff and to employ outside counsel or
consultants at Company expense.
2. Perform such additional functions as are necessary or prudent to fulfill the Committee's duties and
responsibilities.
While the Committee has the duties and powers set forth in this Committee charter, it is not the duty of the
Committee to conduct audits or carry out its own independent analyses for purposes of determining that the
Company's financial statements are complete and accurate and are in accordance with generally accepted accounting
principles. This is the responsibility of management and the independent public accountants. Nor is it the duty
of the Committee to conduct investigations, to resolve disagreements, if any, between management and the
independent public accountants or to assure compliance with laws and regulations and the Company's Standards of
Conduct.
A-3
Internet Voting Screen No. 1
[Equiserve Logo]
VOTE BY NET
[Graphic Omitted]
Welcome to the Equiserve online voting wizard!
Just follow a few simple steps to complete the secure online voting process:
Authentication: Login using your voter control number
Delivery preference: Setup future delivery of your annual meeting materials
Voting: Cast your vote and receive your confirmation online
Finish: Update your address and review other options
If you have more than one proxy card, instruction card or ballot, please vote them one card at a time. To get
started now, login below and click "Continue."
----------------------------------------------------------------------------------
Step 1: Authentication
Enter the voter control number as it appears on your
proxy card, instruction card or ballot. [______________________________]
Enter the last 4 digits of the U.S. social security
number (SSN) or the U.S. taxpayer identification
number (TIN) for this account.* [__________]
*If you do not have a SSN or TIN for
this account, please leave this box blank.
CONTINUE
--------
Copyright(C)2002 EquiServe. All rights reserved.
Internet Voting Screen No. 2
[Equiserve Logo]
VOTE BY NET
[Graphic Omitted]
[Edison International Logo]
Welcome
Name Line
Address Line
City, State, Zip Line
CONTINUE
--------
Copyright(C)2002 EquiServe. All rights reserved.
Internet Voting Screen No. 3
[Equiserve Logo]
VOTE BY NET
[Graphic Omitted]
[Edison International Logo]
Proxy/Voting Instruction Card
THIS PROXY IS SOLICITED ON BEHALF OF THE BOARD OF DIRECTORS
JOHN E. BRYSON and THEODORE F. CRAVER, JR. are hereby appointed proxies of the undersigned with full power of
substitution to vote all shares of stock the undersigned is entitled to vote at the annual meeting of
shareholders of Edison International to be held at the DoubleTree Hotel Ontario, 222 N. Vineyard Avenue, Ontario,
California, on May 14, 2002, at 10:00 a.m., Pacific Time, or at any adjournment or postponement of the meeting,
with all the powers and discretionary authority the undersigned would possess if personally present at the
meeting on the matter listed below.
The shares will be voted as indicated on this card. In addition, the appointed proxies may vote in their
discretion on such other matters as may properly come before the meeting.
VOTING INSTRUCTIONS TO THE EDISON INTERNATIONAL STOCK FUND INVESTMENT MANAGER, STATE STREET BANK AND TRUST COMPANY
If I hold shares through the Southern California Edison Company Stock Savings Plus Plan, this card also provides
the following voting instructions to the Edison International stock fund investment manager: You are instructed
to vote confidentially as described above the shares of stock credited and conditionally credited to my account
through March 15, 2002. I understand that the stock will be voted as directed provided the Edison International
stock fund investment manager receives this card by 5:00 p.m., Eastern Time, on May 9, 2002, and all stock for
which the Edison International stock fund investment manager has not received instructions by this card at the
designated time may be voted in its discretion.
Edison International Directors recommend a vote:
"FOR" all Nominees
Check this box to cast your vote in accordance with the
recommendation of Edison International Directors: [__]
---------------------------------------------------------------------------------------------
Edison International Directors recommend a vote "FOR" all Nominees.
1. Election of Directors [__] FOR ALL NOMINEES, except as noted below [__] WITHHOLD AS TO ALL NOMINEES
[__] J. E. Bryson [__] B.M. Freeman [__] J.C. Hanley
[__] B. Karatz [__] L.G. Nogales [__] R.L. Olson
[__] J.M. Rosser [__] R.T. Schlosberg, III [__] R.H. Smith
[__] T.C. Sutton [__] D.M. Tellep
If applicable, click the option box:
[__] Mark here if you plan to attend the annual meeting.
[__] If you receive more than one set of Proxy Materials at the address shown on
this proxy card and have no need for the extra copies, please mark here.
Proxy cards will continue to be mailed to this account. Please make sure that
at least one account continues to receive these materials.
[__] If you wish to receive shareholder communications including Proxy Statements
and Annual Reports via the Internet as described in the Proxy Statement,
please mark here.
To cast your vote please click "Submit.".
(Note: Your vote will not be counted until you click "Submit.")
SUBMIT
------
Copyright(C)2000 EquiServe. All rights reserved.
Internet Voting Screen No. 4
[Equiserve Logo]
VOTE BY NET
[Graphic Omitted]
[Edison International Logo]
Name:
Address Line:
City, State, Zip Line
Control Number:
Confirmation Number:
Date:
Thank you for using Equiserve's Vote-By-Net facility.
------------------------------------------------------------------------------------
Step 3: Summary of your vote
Your vote was recorded by Equiserve as follows:
1. Election of Directors [Stockholder's vote inserted here.]
------------------------------------------------------------------------------------
Please keep a copy for your records. To change your vote click "Back."
You can now vote another ballot or click "Finish" to exit to Equiserve Homepage.
BACK FINISH
---- ------
Copyright(C)2000 EquiServe. All rights reserved.
2002 TELEPHONE VOTING SCRIPT
TOLL FREE FROM THE U.S. AND CANADA: 1-877-PRX-VOTE OR 1-877-779-8683
CALL COLLECT FROM OUTSIDE THE U.S. AND CANADA: 201-536-8073
1. Welcome to the electronic voting system. Please have your proxy card or voting instruction sheet or ballot
available before voting.
2. Enter the Voter Control Number as it appears on the card followed by the pound sign.
One moment please while we verify your information.
3. Enter the last four digits of the U.S. social security number or the U.S. taxpayer identification number
for this account followed by the pound sign.
4. The company that you are voting is Edison International.
5. Your vote is subject to the same terms and authorizations as indicated on the proxy card. It also
authorizes the named proxies to vote according to the instructions at the meeting of the stockholders.
6. To vote the proposal in accordance with the recommendations of the Board of Directors, press 1. If you
wish to vote on the proposal, press 2.
If 1, go to 8.
If 2, go to 7.
7. Item # 1. To vote for all nominees press 1. To withhold from all nominees press 2. To withhold from
individual nominees press 3.
If 1, go to 8.
If 2, go to 8.
If 3, go to Director Exception.
Director Exception
Enter the 2-digit number next to the nominee from whom you would like to withhold your vote,
followed by the pound key. Or, if you have completed voting on directors, press the pound key
again.
If pound key entered twice, go to 8.
If valid nominee number, go to Next Nominee.
\
Next Nominee
To withhold your vote from another nominee enter the 2-digit number next to the nominee
followed by the pound key. Or if you have completed voting on directors press the pound key
again.
If pound key entered twice, go to 8.
If valid nominee number, go to Next Nominee.
Invalid Nominee Number
You have entered an invalid nominee number.
{Go to Next Nominee.}
8. If you would like to attend the annual meeting, press 1. If not, press 2.
If 1, go to 9.
If 2, go to 9.
9. If you receive more than one set of proxy materials at the address shown on your proxy card and have no
need for the extra copies, please press 1. If not, press 2.
If 1, go to 10.
If 2, go to 10.
10. If you are interested in receiving shareholder communications including annual meeting materials
electronically, press 1. If not, press 2.
If 1, go to 11.
If 2, go to 11.
11. You have cast your vote as follows:
|X| Play back Playback back the appropriate vote for this proxy card.}
Default Playback
You have voted in the manner recommended by the Board of Directors.
Director Proposal Playback
Voted for all nominees: Item #1. You have voted for all nominees
Withhold from all nominees: Item #1. You have voted to withhold your vote from all nominees.
Withhold from individual nominees: Item # 1. You have voted for all nominees except for the
following nominee numbers.
12. To confirm your vote, press 1. To cancel your vote, press 2.
If 1, go to 14.
If 2, go to 13.
13. Your vote has been cancelled. If you wish to vote this card or another card, press 1. Otherwise, please
hang up and mark, sign, and return your card in the envelope provided. Thank you for calling.
14. Your vote has been successfully recorded. It is not necessary for you to mail in your card. If you wish
to vote another card or change your vote, press 1. Otherwise, please hang up. Thank you for voting.
Invalid Control Numbers
We were unable to authenticate the information that you entered.
Invalid Social Security Number or Taxpayer Identification Number
We were unable to authenticate the information that you entered.
No Key Pressed
Go to the same item (repeat three times); otherwise, go to Error.
Invalid Number
You have entered an invalid option. Go to the same item (repeat three times); otherwise, go to
Error.
Error
We are unable to process your request at this time. Thank you for calling.
{Call ends.}