-----BEGIN PRIVACY-ENHANCED MESSAGE----- Proc-Type: 2001,MIC-CLEAR Originator-Name: webmaster@www.sec.gov Originator-Key-Asymmetric: MFgwCgYEVQgBAQICAf8DSgAwRwJAW2sNKK9AVtBzYZmr6aGjlWyK3XmZv3dTINen TWSM7vrzLADbmYQaionwg5sDW3P6oaM5D3tdezXMm7z1T+B+twIDAQAB MIC-Info: RSA-MD5,RSA, LmgTOdiEOCO5Z7WoifaFeImhPQJViTGJhjnFUxeL2ap69yN0dxL7D4VwoaiAtQVt nyMyQAolAFhcvdfDUV3m5Q== 0000898430-99-002814.txt : 19990714 0000898430-99-002814.hdr.sgml : 19990714 ACCESSION NUMBER: 0000898430-99-002814 CONFORMED SUBMISSION TYPE: S-3/A PUBLIC DOCUMENT COUNT: 2 FILED AS OF DATE: 19990713 FILER: COMPANY DATA: COMPANY CONFORMED NAME: EDISON INTERNATIONAL CENTRAL INDEX KEY: 0000827052 STANDARD INDUSTRIAL CLASSIFICATION: ELECTRIC SERVICES [4911] IRS NUMBER: 954137452 STATE OF INCORPORATION: CA FISCAL YEAR END: 1231 FILING VALUES: FORM TYPE: S-3/A SEC ACT: SEC FILE NUMBER: 333-82293 FILM NUMBER: 99663731 BUSINESS ADDRESS: STREET 1: 2244 WALNUT GROVE AVE, STE 374 STREET 2: P O BOX 800 CITY: ROSEMEAD STATE: CA ZIP: 91770 BUSINESS PHONE: 6263022222 FORMER COMPANY: FORMER CONFORMED NAME: SCECORP DATE OF NAME CHANGE: 19920703 FILER: COMPANY DATA: COMPANY CONFORMED NAME: EIX TRUST I CENTRAL INDEX KEY: 0001089816 STANDARD INDUSTRIAL CLASSIFICATION: [] STATE OF INCORPORATION: DE FISCAL YEAR END: 1231 FILING VALUES: FORM TYPE: S-3/A SEC ACT: SEC FILE NUMBER: 333-82293-01 FILM NUMBER: 99663732 BUSINESS ADDRESS: STREET 1: 2244 WALNUT GROVE AVE STREET 2: ROOM 369 CITY: ROSEMEAD STATE: CA ZIP: 91770 BUSINESS PHONE: 6263021930 MAIL ADDRESS: STREET 1: 2244 WALNUT GROVE AVE STREET 2: ROOM 369 CITY: ROSEMEAD STATE: CA ZIP: 91770 FILER: COMPANY DATA: COMPANY CONFORMED NAME: EIX TRUST II CENTRAL INDEX KEY: 0001089817 STANDARD INDUSTRIAL CLASSIFICATION: [] STATE OF INCORPORATION: DE FISCAL YEAR END: 1231 FILING VALUES: FORM TYPE: S-3/A SEC ACT: SEC FILE NUMBER: 333-82293-02 FILM NUMBER: 99663733 BUSINESS ADDRESS: STREET 1: 2244 WALNUT GROVE AVE STREET 2: ROOM 369 CITY: ROSEMEAD STATE: CA ZIP: 91770 BUSINESS PHONE: 6263021930 MAIL ADDRESS: STREET 1: 2244 WALNUT GROVE AVE STREET 2: ROOM 369 CITY: ROSEMEAD STATE: CA ZIP: 91770 FILER: COMPANY DATA: COMPANY CONFORMED NAME: EIX TRUST III CENTRAL INDEX KEY: 0001089818 STANDARD INDUSTRIAL CLASSIFICATION: [] STATE OF INCORPORATION: DE FISCAL YEAR END: 1231 FILING VALUES: FORM TYPE: S-3/A SEC ACT: SEC FILE NUMBER: 333-82293-03 FILM NUMBER: 99663734 BUSINESS ADDRESS: STREET 1: 2244 WALNUT GROVE AVE STREET 2: ROOM 369 CITY: ROSEMEAD STATE: CA ZIP: 91770 BUSINESS PHONE: 6263021930 MAIL ADDRESS: STREET 1: 2244 WALNUT GROVE AVE STREET 2: ROOM 369 CITY: ROSEMEAD STATE: CA ZIP: 91770 S-3/A 1 FORM S-3, AMENDMENT NO. 1 As filed with the Securities and Exchange Commission on July 13, 1999 Registration No. 333-82293 - ------------------------------------------------------------------------------- - ------------------------------------------------------------------------------- SECURITIES AND EXCHANGE COMMISSION Washington, DC 20549 -------------- AMENDMENT NO. 1 to FORM S-3 REGISTRATION STATEMENT UNDER THE SECURITIES ACT OF 1933 --------------
Edison International California 95-4137452 EIX Trust I Delaware 95-7077769 EIX Trust II Delaware 95-7077770 EIX Trust III Delaware 95-7077771 (State or Other Jurisdiction (I.R.S. Employer (Exact name of Registrant of Identification Number) as Specified in Its Incorporation or Charter) Organization)
-------------- 2244 Walnut Grove Avenue (P.O. Box 800) Rosemead, California 91770 (626) 302-2222 (Address, Including Zip Code, and Telephone Number, Including Area Code, of each Registrant's Principal Executive Offices) -------------- Kenneth S. Stewart, Esq. Assistant General Counsel and Assistant Secretary 2244 Walnut Grove Avenue Rosemead, California 91770 (626) 302-6601 (Name, Address, Including Zip Code, and Telephone Number, Including Area Code, of Agent For Service) -------------- Approximate Date of Commencement of Proposed Sale to the Public: From time to time after the registration statement becomes effective, as determined by market and other conditions. -------------- If the only securities being registered on this form are being offered pursuant to dividend or interest reinvestment plans, please check the following box. [_] -------------- If any of the securities being registered on this form are to be offered on a delayed or continuous basis pursuant to Rule 415 under the Securities Act of 1933, other than securities offered only in connection with dividend or interest reinvestment plans, check the following box. [X] -------------- If this form is filed to register additional securities for an offering pursuant to Rule 462(b) under the Securities Act, please check the following box and list the Securities Act registration statement number of the earlier effective registration statement for the same offering. [_] -------------- If this form is a post-effective amendment filed pursuant to Rule 462(c) under the Securities Act, check the following box and list the Securities Act registration statement number of the earlier effective registration statement for the same offering. [_] -------------- If delivery of the prospectus is expected to be made pursuant to Rule 434, please check the following box. [_] CALCULATION OF REGISTRATION FEE - --------------------------------------------------------------------------------------------------- - ---------------------------------------------------------------------------------------------------
Title of each class of Proposed maximum Amount of securities to be Amount to be aggregate offering Registration registered(1) registered(1)(2)(3) price(3)(4) Fee(7) - --------------------------------------------------------------------------------------------------- Debt Securities, Common Stock, without par value, and Preferred Stock, without par value, of Edison International.............. - --------------------------------------------------------------------------------------------------- Rights to Purchase Series A Junior Participating Cumulative Preferred Stock, without par value, of Edison International(5)............................ - --------------------------------------------------------------------------------------------------- Preferred Securities of EIX Trust I, EIX Trust II and EIX Trust III(6)............... - --------------------------------------------------------------------------------------------------- Guarantees of Preferred Securities of the Trusts by Edison International(6)........... - --------------------------------------------------------------------------------------------------- Total..................................... $2,500,000,000 $2,500,000,000 $695,000 - --------------------------------------------------------------------------------------------------- - ---------------------------------------------------------------------------------------------------
(1) An indeterminate principal amount or number of debt securities, common stock and/or preferred stock and guarantees of Edison International and an indeterminate number of preferred securities of the Trusts as may from time to time be issued at indeterminate prices, with an aggregate offering price not to exceed $2,500,000,000. Debt securities may be issued and sold to the Trusts, in which event the debt securities may later be distributed to the holders of preferred securities. (2) In United States dollars or the equivalent thereof in any other currency, composite currency or currency unit as shall result in an aggregate initial offering price for all securities of $2,500,000,000. (3) This amount represents the principal amount of any debt securities issued at their principal amount, the issue price of any debt securities issued at an original issue discount, the issue price of any preferred stock and preferred securities and the amount computed pursuant to Rule 457(c) for any common stock. (4) Estimated solely for the purpose of calculating the registration fee, which is calculated in accordance with Rule 457(o) of the rules and regulations under the Securities Act of 1933. Rule 457(o) permits the registration fee to be calculated on the basis of the maximum offering price of all of the securities listed and, therefore, the table does not specify by each class information as to the amount to be registered, the proposed maximum offering price per unit or the proposed maximum aggregate offering price. (5) The Rights are initially carried and traded with the common stock. The value attributable to the Rights, if any, is reflected in the value of the common stock. (6) Includes the rights of holders of the preferred securities under the guarantees of preferred securities and back-up undertakings, consisting of obligations by Edison International, as set forth in the trust agreement, the applicable indenture and any supplemental indenture thereto, in each case as further described in the Registration Statement. No separate consideration will be received for any guarantees or any back-up undertakings. (7) Fee of $695,000 paid in connection with original Registration Statement filed on July 2, 1999. -------------- The Registrants hereby amend this Registration Statement on such date or dates as may be necessary to delay its effective date until the Registrants shall file a further amendment which specifically states that this Registration Statement shall thereafter become effective in accordance with Section 8(a) of the Securities Act of 1933 or until this Registration Statement shall become effective on such date as the Securities and Exchange Commission, acting pursuant to said Section 8(a), may determine. - ------------------------------------------------------------------------------- - ------------------------------------------------------------------------------- EXPLANATORY NOTE This Registration Statement includes a prospectus supplement that relates to the proposed offering of QUIPS as described therein currently planned to commence as soon as practicable after the effective date of the Registration Statement. ++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++ +The information in this prospectus is not complete and may be changed. We may + +not sell these securities until the registration statement filed with the + +Securities and Exchange Commission is effective. This prospectus is not an + +offer to sell these securities and it is not soliciting an offer to buy these + +securities in any state where the offer or sale is not permitted. + ++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++ Subject to Completion, Dated July 13, 1999. Prospectus Supplement to Prospectus Dated , 1999. [LOGO OF EDISON INTERNATIONAL] 20,000,000 Preferred Securities EIX Trust I % Cumulative Quarterly Income Preferred Securities, Series A (QUIPS(SM))* (Liquidation Amount $25 per QUIPS) Fully and unconditionally guaranteed, as described herein, by Edison International ---------- A brief description of the % Cumulative Quarterly Income Preferred Securities, Series A (QUIPS(SM)) can be found under "Summary Information--Q&A" in this prospectus supplement. Application has been made to list the QUIPS on the New York Stock Exchange. If the QUIPS are approved for listing, Edison International expects trading of the QUIPS to begin within 30 days after they are first issued. See "Risk Factors" beginning on page S-6 to read about specific risks you should consider before buying the QUIPS. ---------- Neither the Securities and Exchange Commission nor any other regulatory body has approved or disapproved of these securities or passed upon the accuracy or adequacy of this prospectus. Any representation to the contrary is a criminal offense. ----------
Per QUIPS Total --------- ------------ Initial public offering price(1)....................... $25.00 $500,000,000 Underwriting commissions to be paid by Edison International......................................... $ $ Proceeds to EIX Trust I................................ $ $
- ----- (1) Plus accumulated distributions, if any, from , 1999. The Underwriters may, subject to the terms of the underwriting agreement, purchase up to an additional 3,000,000 QUIPS from EIX Trust I at the initial public offering price per QUIPS (plus accumulated distributions, if any, from , 1999), less the underwriting commissions. ---------- The Underwriters expect to deliver the QUIPS in book-entry form only through the facilities of The Depository Trust Company against payment in New York, New York on , 1999. *"QUIPS" AND "QUIDS" are registered service marks of Goldman, Sachs & Co. Goldman, Sachs & Co. A.G. Edwards & Sons, Inc. Lehman Brothers Merrill Lynch & Co. Morgan Stanley Dean Witter PaineWebber Incorporated Prudential Securities Incorporated Salomon Smith Barney ---------- Prospectus Supplement dated , 1999. SUMMARY INFORMATION--Q&A The following information supplements, and should be read together with, the information contained in other parts of this prospectus supplement and in the accompanying prospectus. This summary highlights selected information from this prospectus supplement and the accompanying prospectus to help you understand the % Cumulative Quarterly Income Preferred Securities, Series A (QUIPS(SM)) (the "Series A QUIPS"). You should carefully read this prospectus supplement and the accompanying prospectus to understand fully the terms of the Series A QUIPS as well as the tax and other considerations that are important to you in making a decision about whether to invest in the Series A QUIPS. You should pay special attention to the "Risk Factors" section beginning on Page S- 6 of this prospectus supplement to determine whether an investment in the Series A QUIPS is appropriate for you. What are the Series A QUIPS? Each Series A QUIPS represents an undivided beneficial interest in the assets of EIX Trust I (the "Trust"). Each Series A QUIPS will entitle the holder to receive quarterly cash distributions as described in this prospectus supplement. The Trust is offering 20,000,000 Series A QUIPS at a price of $25 for each Series A QUIPS. Who is the Trust? The Trust is a Delaware business trust. Its principal offices are located at 2244 Walnut Grove Avenue, Rosemead, California 91770 and the telephone number is (626) 302-1930. The Trust will sell its Series A QUIPS to the public and its Series A common securities (the "Series A Common Securities") to Edison International. The Trust will use the proceeds from these sales to buy the % Subordinated Deferrable Interest Notes, Series A due , 2029 (QUIDS(SM)) (the "Series A QUIDS") from Edison International with the same financial terms as the Series A QUIPS. Edison International will guarantee payments made on the Series A QUIPS as described below. The Chase Manhattan Bank will act as property trustee (the "Property Trustee") of the Trust. Three officers of Edison International also will act as trustees (the "Regular Trustees") of the Trust. Chase Manhattan Bank Delaware will be an additional trustee (the "Delaware Trustee") of the Trust. The Chase Manhattan Bank also will act as trustee (the "Subordinated Indenture Trustee") under the Subordinated Indenture, as supplemented (the "Subordinated Indenture"), pursuant to which the Series A QUIDS will be issued and will act as trustee (the "Guarantee Trustee") under a Guarantee Agreement with Edison International in respect of the Series A QUIPS (the "Series A QUIPS Guarantee"). The Property Trustee, Delaware Trustee and Regular Trustees are sometimes referred to as the "Securities Trustees." Who is Edison International? Edison International was incorporated on April 20, 1987, under the laws of the State of California for the purpose of becoming the parent holding company of Southern California Edison Company, a California public utility corporation. As of December 31, 1998, Edison International owned all of the issued and outstanding common stock of Southern California Edison Company and of the following subsidiaries engaged in nonutility businesses: Edison Mission Energy, Edison Capital, Mission Land Company and Edison Enterprises. The principal executive offices of Edison S-2 International are located at 2244 Walnut Grove Avenue, Rosemead, California 91770, and its telephone number is (626) 302-2222. When will you receive quarterly distributions? If you purchase the Series A QUIPS, you are entitled to receive cumulative cash distributions at an annual rate of % of the liquidation amount of $25 per Series A QUIPS. Distributions will accumulate from the date the Trust first issues the Series A QUIPS and will be paid quarterly in arrears on August 31, November 30, February 28 and May 31 of each year, beginning August 31, 1999. When can payment of your distributions be deferred? So long as no event of default under the Subordinated Indenture ("Subordinated Indenture Event of Default") has occurred and is continuing, Edison International can, on one or more occasions, defer interest payments on the Series A QUIDS for up to 20 consecutive quarterly periods. A deferral of interest payments cannot extend, however, beyond the maturity date of the Series A QUIDS, which is , 2029, subject to extension rights as described below. If Edison International defers interest payments on the Series A QUIDS, the Trust will also defer distributions on the Series A QUIPS. During this deferral period, distributions will continue to accumulate on the Series A QUIPS at an annual rate of % of the liquidation amount of $25 per Series A QUIPS. Also, the deferred distributions will themselves accumulate additional distributions, compounded quarterly, at an annual rate of %, to the extent permitted by law. If Edison International makes all deferred interest payments on the Series A QUIDS, with accrued interest, it can again defer interest payments on the Series A QUIDS. During any period in which Edison International defers interest payments on the Series A QUIDS, with limited exceptions, Edison International will not be permitted to: . pay a dividend or make any distributions on its capital stock or redeem, purchase, acquire or make a liquidation payment on any of its capital stock; or . make an interest, principal or premium payment on, or repurchase or redeem, any of its debt securities that rank equally with or junior to the Series A QUIDS, or make any guarantee payments with respect to any guarantee by it of debt securities of any of its subsidiaries if the guarantee is equal to or junior in right of payment to the Series A QUIDS. If Edison International defers payments of interest on the Series A QUIDS, the Series A QUIDS will, from the time of deferral, be treated as having been reissued with original issue discount ("OID") for United States federal income tax purposes. This means that you will be required to accrue interest income and include the amounts of this income in your gross income for United States federal income tax purposes even though you will not have received any cash distributions relating to this interest income, and even though you may use the cash method of accounting. See "Material United States Federal Income Tax Considerations--Interest Income and Original Issue Discount" in this prospectus supplement. When can the Trust redeem the Series A QUIPS? The Trust must redeem all of the outstanding Series A QUIPS and Series A Common Securities when the Series A QUIDS are paid at maturity on , 2029, which maturity may be extended as described below. In addition, if Edison International redeems any Series A QUIDS before their S-3 maturity, the Trust will use the cash it receives from the redemption to redeem, on a pro rata basis, Series A QUIPS and Series A Common Securities (collectively, the "Series A Trust Securities") having a combined liquidation amount equal to the principal amount of the Series A QUIDS redeemed. Edison International can redeem some or all of the Series A QUIDS before their maturity at 100% of their principal amount on one or more occasions any time on or after , 2004. Edison International also has the option to redeem the Series A QUIDS, in whole, but not in part, at any time if specific changes in tax or investment company law occur and other conditions are satisfied, as more fully described under "Description of the Series A QUIDS--Optional Redemption." In any case, Edison International will pay accrued interest to the date of redemption. What is Edison International's guarantee of the Series A QUIPS? Edison International will guarantee the Series A QUIPS based on: . the Series A QUIPS Guarantee, which guarantees the Trust's obligation to pay distributions on the Series A QUIPS; and . its obligations under the Amended and Restated Trust Agreement of the Trust (the "Trust Agreement") and the Agreement as to Expenses and Liabilities between Edison International and the Trust (the "Expense Agreement"). The payment of distributions on the Series A QUIPS is guaranteed by Edison International under the Series A QUIPS Guarantee, but only to the extent the Trust has funds legally and immediately available to make distributions. See "Description of Preferred Securities Guarantees," "Description of Expense Agreements" and "Relationship among Preferred Securities, Preferred Securities Guarantees and Subordinated Debt Securities Held by Each Trust" in the accompanying prospectus. Edison International's obligations under the Series A QUIPS Guarantee are: . subordinate and junior in right of payment to all of its other liabilities, except those that rank equally or are subordinate by their terms; and . equal in rank with any other preferred securities guarantee similar to the Series A QUIPS Guarantee issued by Edison International on behalf of the holders of preferred securities issued by any other trust established by Edison International or its affiliates. When could the Series A QUIDS be distributed to you? Edison International has the right to terminate the Trust at any time. If Edison International terminates the Trust, the Trust will liquidate by distributing the Series A QUIDS to holders of the Series A Trust Securities on a pro rata basis. If the Series A QUIDS are distributed, Edison International will use its best efforts to list the Series A QUIDS on the New York Stock Exchange or any other exchange on which the Series A QUIPS are then listed in place of the Series A QUIPS. For a discussion of Edison International's ability to distribute the Series A QUIDS, see "Description of the Series A QUIPS-- Exchange of Series A QUIPS for Series A QUIDS" in this prospectus supplement and "Description of Preferred Securities--Liquidation Distribution upon Dissolution" in the accompanying prospectus. Will the Series A QUIPS be listed on a stock exchange? Application has been made to list the Series A QUIPS on the New York Stock Exchange. If approved, trading of the Series A QUIPS is expected to begin within 30 days after they are first issued. S-4 Will holders of the Series A QUIPS have any voting rights? Generally, the holders of the Series A QUIPS will not have any voting rights. See "Description of Preferred Securities--Voting Rights; Amendment of Trust Agreement" in the accompanying prospectus. In what form will the Series A QUIPS be issued? The Series A QUIPS will be represented by one or more global securities that will be deposited with and registered in the name of The Depositary Trust Company or its nominee. This means that you will not receive a certificate for your Series A QUIPS and that your broker will maintain your position in the Series A QUIPS. Edison International expects that the Series A QUIPS will be ready for delivery through The Depository Trust Company on or about , 1999. S-5 RISK FACTORS Your investment in the Series A QUIPS will involve risks. You should carefully consider the following discussion of risks, and the other information in this prospectus supplement and the accompanying prospectus (including the documents incorporated by reference in the prospectus), before deciding whether an investment in the QUIPS is suitable for you. Edison International's Obligations under the Series A QUIDS and the Series A QUIPS Guarantee are Deeply Subordinated. Edison International's obligations under the Series A QUIDS are unsecured and will rank junior in priority of payment to all of Edison International's other liabilities except those that rank equally or are subordinate by their terms ("senior debt"). Edison International's obligations under the Series A QUIPS Guarantee are unsecured and will rank in priority of payment as follows: . subordinate and junior in right of payment to its senior debt; and . equal in rank with any other preferred securities guarantee similar to the Series A QUIPS Guarantee hereafter issued by Edison International on behalf of the holders of preferred securities issued by any other trust established by Edison International or its affiliates. This means that Edison International cannot make any payments on the Series A QUIDS or the Series A QUIPS Guarantee if it defaults on a payment of senior debt and does not cure that default within the applicable grace period or if any senior debt becomes immediately due because of a default and has not yet been paid in full. In addition, in the event of the bankruptcy, liquidation or dissolution of Edison International, its assets would be available to pay obligations under the Series A QUIDS or the Series A QUIPS Guarantee only after Edison International made all payments on its senior debt. Because Edison International is a holding company, Edison International's right to participate in any asset distribution of any of its subsidiaries, on liquidation, reorganization or otherwise, will rank junior to the rights of all creditors of that subsidiary (except to the extent that Edison International may itself be a creditor of that subsidiary). The rights of holders of the Series A QUIPS or Series A QUIDS to benefit from those distributions will also be junior to those prior claims. Consequently, the Series A QUIDS (and, therefore, the Series A QUIPS) will be effectively subordinated to all liabilities of Edison International's subsidiaries. You should look only to the assets of Edison International for payments on the Series A QUIDS (and the Series A QUIPS). At March 31, 1999, Edison International had total liabilities of approximately $21.217 billion. Of this amount, approximately $6.770 billion would be Senior Debt (as defined below) of Edison International or liabilities of its subsidiaries that would effectively rank senior to the Series A QUIDS. During the second quarter of 1999, Edison International's subsidiaries issued the following additional Senior Debt: . $300 million of 6.65% notes due 2029 in April 1999 . $120 million of 6.0% preferred securities in May 1999 . $600 million of 7.73% senior notes due 2009 in June 1999 None of the Series A QUIPS, the Series A QUIDS nor the Series A QUIPS Guarantee limits the ability of Edison International to incur additional indebtedness, including indebtedness that will rank senior in priority of payment to the Series A QUIDS or the Series A QUIPS Guarantee. We expect that Edison International and its subsidiaries may incur substantial additional amounts of indebtedness in the future. S-6 The Series A QUIPS Guarantee Only Covers Payments if the Trust Has Cash Available, but You May Sue Edison International Directly. The ability of the Trust to pay scheduled distributions on the Series A QUIPS, the redemption price of the Series A QUIPS and the liquidation amount of each Series A QUIPS is solely dependent upon Edison International making the related payments on the Series A QUIDS when due. If Edison International defaults on its obligations to pay principal or interest on the Series A QUIDS, the Trust will not have sufficient funds to pay distributions on, or the redemption price or liquidation amount of, each Series A QUIPS. In those circumstances, you will not be able to rely upon the Series A QUIPS Guarantee for payment of these amounts. Instead, you: . may directly sue Edison International or seek other remedies to collect your pro rata share of payments owed; or . may rely on the Property Trustee to enforce the Trust's rights under the Series A QUIDS. Deferral of Distributions Would Have Tax Consequences for You and May Affect the Trading Price of the Series A QUIPS. So long as no Subordinated Indenture Event of Default has occurred and is continuing, Edison International can, on one or more occasions, defer interest payments on the Series A QUIDS for up to 20 consecutive quarterly periods. If Edison International defers interest payments on the Series A QUIDS, the Trust will defer distributions on the Series A QUIPS during any deferral period. However, distributions would still accumulate and such deferred distributions would themselves accumulate additional distributions, compounded quarterly, at the annual rate of % per annum, to the extent permitted by law. If Edison International defers payments of interest on the Series A QUIDS, you will be required to include interest income in gross income for United States federal income tax purposes in the form of OID, based on your pro rata share of the deferred interest on the Series A QUIDS held by the Trust, before you receive any cash relating to your interest, even if you use the cash method of accounting. In addition, you will not receive this cash if you sell the Series A QUIPS before the end of any deferral period or before the record date relating to distributions which are paid. Edison International has no current intention of deferring interest payments on the Series A QUIDS. However, if Edison International exercises its right in the future, the Series A QUIPS may trade at a price that does not fully reflect the value of accrued but unpaid interest on the Series A QUIDS. If you sell the Series A QUIPS during an interest deferral period, you may not receive the same return on investment as someone else who continues to hold the Series A QUIPS. In addition, the existence of Edison International's right to defer payments of interest on the Series A QUIDS may mean that the market price for the Series A QUIPS, which represent an undivided beneficial interest in the Series A QUIDS, may be more volatile than other securities that do not have these rights. See "Material United States Federal Income Tax Considerations" in this prospectus supplement for more information regarding the tax consequences of purchasing, holding and selling the Series A QUIPS. Series A QUIPS May Be Redeemed at Any Time if Adverse Changes in Tax or Investment Company Law Occur. If Edison International receives an opinion of counsel that adverse changes in tax or investment company law have occurred or will occur, and other conditions are satisfied, Edison International has S-7 the right to redeem the Series A QUIDS, in whole, but not in part, at any time within 90 days of receipt of such opinion. Any such redemption will cause a mandatory redemption of all Series A QUIPS and Series A Common Securities at a redemption price equal to $25 per security plus any accrued and unpaid distributions. See "Description of the Series A QUIDS--Optional Redemption" in this prospectus supplement. The Series A QUIDS, and Therefore the Series A QUIPS, May Be Redeemed at Par at the Option of Edison International Five Years after Issuance. At the option of Edison International, the Series A QUIDS may be redeemed, in whole, at any time, or in part, from time to time, on or after , 2004, at a redemption price equal to the principal amount to be redeemed plus any accrued and unpaid interest to the date of redemption. See "Description of the Series A QUIDS--Optional Redemption" in this prospectus supplement. You should assume that Edison International will exercise its redemption option if Edison International is able to refinance at a lower interest rate or it is otherwise in the interest of Edison International to redeem the Series A QUIDS. If the Series A QUIDS are redeemed, the Trust must redeem the Series A Trust Securities having an aggregate liquidation amount equal to the aggregate principal amount of Series A QUIDS to be redeemed. See "Description of the Series A QUIPS--Redemption" in this prospectus supplement. Edison International May Change the Stated Maturity of the Series A QUIDS As long as certain conditions are met, Edison International will have the right to extend the stated maturity of the Series A QUIDS--and therefore the mandatory redemption date of the Series A QUIPS--to , 2048. You should assume that Edison International will exercise its option to extend the stated maturity if Edison International is unable to refinance at a lower interest rate or it is in the interest of Edison International to defer the stated maturity of the Series A QUIDS. Consequently, you may have to wait nineteen years beyond the initial stated maturity before the Trust redeems the Series A QUIPS. See "Description of the Series A QUIDS--Stated Maturity" in this prospectus supplement. There Can Be No Assurance as to the Market Prices for the Series A QUIPS or the Series A QUIDS. There can be no assurance as to the market prices for the Series A QUIPS or the Series A QUIDS that may be distributed in exchange for Series A QUIPS upon a termination of the Trust. Accordingly, the Series A QUIPS that you purchase, whether pursuant to the offer made by this prospectus supplement or in the secondary market, or the Series A QUIDS that you may receive upon a termination of the Trust, may trade at a discount to the price that you paid to purchase the Series A QUIPS offered by this prospectus supplement. As a result of Edison International's right to defer interest payments on the Series A QUIDS, the market price of the Series A QUIPS, which represent undivided beneficial ownership interests in the Trust, substantially all the assets of which consist of the Series A QUIDS, may be more volatile than the market prices of other securities that are not subject to such optional deferrals. Edison International May Terminate the Trust at Any Time. Edison International has the right to terminate the Trust at any time. If Edison International decides to exercise its right to terminate the Trust, the Trust will liquidate by distributing the Series A QUIDS to holders of the Series A QUIPS and the Series A Common Securities on a pro rata basis. Under current United States federal income tax law and interpretations and assuming, as we expect, that the Trust will not be classified as an association taxable as a corporation, you would not be taxed if the Property Trustee distributes the Series A QUIDS to you upon liquidation of the Trust. S-8 However, if a Tax Event (as defined below) were to occur and the Trust were subject to taxation on income received or accrued on the Series A QUIDS, you and the Trust could be taxed on that distribution. Edison International has no current intention of causing the termination of the Trust and the distribution of the Series A QUIDS. Edison International anticipates that it would consider exercising this right in the event that expenses associated with maintaining the Trust were substantially greater than currently expected such as if specific changes in tax law or investment company law occurred. See "Description of the Series A QUIPS--Exchange of Series A QUIPS for Series A QUIDS" in this prospectus supplement and "Description of Preferred Securities--Liquidation Distribution upon Dissolution" in the accompanying prospectus. Edison International cannot predict the other circumstances under which this right would be exercised. Although Edison International intends to use its best efforts to list the Series A QUIDS on the New York Stock Exchange or any other exchange on which the Series A QUIPS are then listed if they are distributed, we cannot assure you that the Series A QUIDS will be approved for listing or that a trading market will exist for those securities. You Have Limited Voting Rights. You will have limited voting rights in respect of the Series A QUIPS. In particular, subject to specific exceptions, only Edison International can appoint or remove any of the Securities Trustees. See "Description of Preferred Securities--Voting Rights; Amendment of Trust Agreement" in the accompanying prospectus. There Has Been No Prior Market for the Series A QUIPS. Before this offering, there has been no market for the Series A QUIPS. Although the Trust has applied to list the Series A QUIPS on the New York Stock Exchange, a listing does not guarantee that a trading market for the Series A QUIPS will develop or, if a trading market for the Series A QUIPS does develop, the depth of that market and the ability of the holders to easily sell their Series A QUIPS. ACCOUNTING TREATMENT For financial reporting purposes, the Trust will be treated as a subsidiary of Edison International and, accordingly, the accounts of the Trust will be included in the consolidated financial statements of Edison International. The Series A QUIPS will be included in the "Preferred securities of subsidiaries not subject to mandatory redemption" line on the consolidated balance sheet of Edison International and also in the table of preferred securities in Note 4 of the "Notes to Consolidated Financial Statements." For financial reporting purposes, distributions payable on the Series A QUIPS will be included in the "Dividends on subsidiary preferred securities" line on the consolidated statement of income of Edison International. USE OF PROCEEDS The Trust will invest all of the proceeds from the sale of Series A QUIPS in the Series A QUIDS. Assuming an initial offering price equal to the liquidation amount of the Series A QUIPS, we estimate such proceeds to be approximately $500,000,000 (or $575,000,000, if the Underwriters' overallotment option is exercised in full). We estimate that the expenses for this offering, excluding underwriting discounts and commissions, will be approximately $1,149,000. Edison International and/or its subsidiaries will use the net proceeds from the sale of the Series A QUIDS for general corporate purposes, including investing in nonutility business activities and reducing short-term debt incurred to provide interim financing for such purposes. S-9 DESCRIPTION OF THE SERIES A QUIPS This section describes the specific terms of the Series A QUIPS. This description supplements, and should be read together with, the description of the general terms and provisions of the Series A QUIPS set forth in the accompanying prospectus under the caption "Description of Preferred Securities." The following description does not purport to be complete and is subject to, and is qualified in its entirety by reference to, the description in the accompanying prospectus and the Trust Agreement. We have filed a form of the Trust Agreement as an exhibit to the Registration Statement of which the accompanying prospectus is a part. General The Trust will issue the Series A QUIPS and the Series A Common Securities, with a stated liquidation amount of $25 per security. The Series A QUIPS and the Series A Common Securities will rank equally with one another. The Trust will make payments on the Series A QUIPS pro rata with the Series A Common Securities, except as described in "--Ranking" below. The Trust will use the proceeds from the sale of the Series A Trust Securities to purchase the Series A QUIDS from Edison International. The Property Trustee will hold legal title to the Series A QUIDS in trust for the benefit of the holders of the Series A Trust Securities. Edison International will guarantee the payment of distributions and other amounts payable on the Series A QUIPS, but only to the extent that the Trust has funds legally and immediately available to make those payments. See "Description of Preferred Securities Guarantees" in the accompanying prospectus. The Trust Agreement will be qualified as an indenture under the Trust Indenture Act. The Property Trustee will act as indenture trustee for the Series A QUIPS, in order to comply with the provisions of the Trust Indenture Act. The Series A QUIPS will be represented by a global security that will be deposited with and registered in the name of The Depository Trust Company ("DTC") or its nominee. Whenever we refer to a "holder" of Series A QUIPS in this prospectus supplement, we mean the registered holder, which, for any Series A QUIPS in book-entry form, will be DTC or its nominee. We discuss various matters relevant to global securities under "Book-Entry Issuance" in this prospectus supplement. Distributions Distributions will accumulate on the Series A QUIPS from the date they are first issued at the annual rate of % of their liquidation amount. Unless deferred as described below, distributions will be payable quarterly in arrears on August 31, November 30, February 28 and May 31 of each year (each, a "distribution date"), beginning August 31, 1999. Distributions not paid when due will accumulate additional distributions, compounded quarterly, at the annual rate of % on the amount of unpaid distributions, to the extent permitted by law. Whenever we use the term "distributions" in this prospectus supplement, we are including any of these distributions. The amount of distributions payable for any period will be computed on the basis of a 360-day year of twelve 30-day months. The assets of the Trust available for distributions to holders of Series A QUIPS will be limited to the interest payments the Trust receives from Edison International in respect of the Series A QUIDS. Consequently, if Edison International defers or for any other reason fails to make interest payments on the Series A QUIDS, the Trust will not have funds to pay distributions on the Series A QUIPS. As long as no Subordinated Indenture Event of Default has occurred and has not been cured, Edison International will have the right to defer interest payments on the Series A QUIDS at any time. Edison International may do so in each case for a period not exceeding 20 consecutive S-10 quarters (each, an "extension period"). No extension period may extend beyond the stated maturity of the Series A QUIDS. Before an extension period ends, Edison International may extend it further if that extension period does not exceed 20 consecutive quarters or extend beyond the stated maturity of the Series A QUIDS. When an extension period ends and Edison International has paid all accrued and unpaid interest on the Series A QUIDS, Edison International may begin a new extension period, subject to the terms described above. There is no limit on the number of extension periods that Edison International may begin. If Edison International defers interest payments on the Series A QUIDS, the Trust also will defer the payment of distributions on the Series A QUIPS. During an extension period, you will still accumulate distributions at the rate stated above, plus you will accumulate additional distributions on the deferred distributions at the same rate, to the extent permitted by law. During an extension period, you will be required to accrue interest income for United States federal income tax purposes. See "Material United States Federal Income Tax Considerations--Interest Income and Original Issue Discount" in this prospectus supplement. Edison International has no current intention to exercise its right to defer interest payments on the Series A QUIDS. If Edison International elects to begin an extension period, it will be subject to specified restrictions relating to paying dividends on or repurchasing its common stock and making payments on certain of its debt securities. See "Description of the Series A QUIDS--Interest--Extension Period Restrictions" in this prospectus supplement. Redemption The Series A QUIPS will remain outstanding until the Trust redeems them or distributes the Series A QUIDS in exchange for the Series A QUIPS. Any redemption of Series A QUIPS must occur as described below. Any exchange distribution must occur as described below in "--Exchange of Series A QUIPS for Series A QUIDS." Redemption of Series A Trust Securities If Edison International repays or redeems the Series A QUIDS, whether at their stated maturity, upon acceleration after a Subordinated Indenture Event of Default or upon early redemption, the Property Trustee will redeem a Like Amount of Series A Trust Securities on the Redemption Date at the Redemption Price. In this context, "Like Amount" means Series A Trust Securities having an aggregate liquidation amount equal to the aggregate principal amount of the Series A QUIDS being repaid or redeemed. "Redemption Date" means the date that the principal of those Series A QUIDS becomes due for payment under the Subordinated Indenture. "Redemption Price" means the aggregate liquidation amount of the Series A Trust Securities to be redeemed, plus any accumulated and unpaid distributions on those securities to the Redemption Date. Repayment and Redemption of Series A QUIDS The Series A QUIDS initially will have a stated maturity of , 2029, which Edison International may shorten to a date on or after , 2014, or, subject to certain conditions being satisfied, extend to , 2048. See "Description of the Series A QUIDS--Stated Maturity" in this prospectus supplement. Edison International also may redeem the Series A QUIDS, at its option, before their stated maturity as follows: . at any time on or after , 2004, in whole or in part, provided that no partial redemption may occur during an extension period, and S-11 . at any time in whole, but not in part, within 90 days after a Tax Event or an Investment Company Act Event has occurred. Please see "Description of Series A QUIDS--Optional Redemption" in this prospectus supplement for the definitions of "Tax Event" and "Investment Company Act Event." If a Tax Event is continuing and Edison International does not elect to redeem the Series A QUIDS or liquidate the Trust, Edison International may be required to pay additional sums on the Series A QUIDS. The provisions regarding repayment and redemption of the Series A QUIDS, as well as information about the effect that possible tax law changes may have on the Series A QUIDS and Series A QUIPS, are discussed in "Description of the Series A QUIDS--Stated Maturity," "--Optional Redemption" and "--Payment of Additional Sums" in this prospectus supplement. Redemption Procedures The Property Trustee will give you at least 30 days, but not more than 60 days, notice before the Redemption Date, unless the redemption results from acceleration after a Subordinated Indenture Event of Default and the Property Trustee is not able to give notice during this period. In that case, the Property Trustee will give the notice as soon as practicable. The Property Trustee will give the notice of redemption in the manner described below under "--Notices." The Property Trustee will irrevocably deposit with DTC (in the case of any book-entry Series A QUIPS) or the Paying Agent (as defined below) (in the case of any non-book-entry Series A QUIPS) funds sufficient to pay the Redemption Price for all Series A Trust Securities being redeemed on that date, to the extent that funds are available to the Property Trustee. The Property Trustee will deposit such funds by 2:00 p.m., New York City time, on the Redemption Date. DTC will pay the Redemption Price for Series A QUIPS held in book-entry form and called for redemption in accordance with the procedures of DTC, to the extent the Property Trustee has deposited sufficient funds with DTC. The Paying Agent will pay the Redemption Price for Series A QUIPS held in certificated form and called for redemption, to the extent the Property Trustee has deposited sufficient funds with the Paying Agent, against surrender of the certificates representing those Series A QUIPS. Any distributions that are due on a distribution date that is on or before the Redemption Date will be payable to the holders of those Series A QUIPS on the record date for the related distribution date. Once the Property Trustee gives notice of redemption and deposits funds as discussed above, all rights of the holders of the Series A Trust Securities called for redemption will cease at the time of the deposit, except the right of those holders to receive the Redemption Price, but without interest on that amount. In addition, those Series A Trust Securities will no longer be outstanding. On the Redemption Date, distributions will stop accumulating on the Series A QUIDS called for redemption. However, if payment of the Redemption Price for any Series A Trust Securities is not made, distributions on the Series A QUIPS will continue to accumulate to the date the Redemption Price is paid. If the Trust redeems less than all the Series A Trust Securities, then the liquidation amount of Series A Trust Securities to be redeemed will be allocated pro rata between the outstanding Series A QUIPS and the outstanding Series A Common Securities, based upon their respective liquidation amounts. Within 60 days of the Redemption Date, the Property Trustee will select the Series A Trust Securities to be redeemed from among the outstanding Series A Trust Securities not previously called for redemption. The Property Trustee may use any method of selection that it deems to be fair and appropriate. S-12 Other Purchases of Series A QUIPS Edison International or its subsidiaries may purchase outstanding Series A QUIPS by tender, in the open market or by private agreement, subject to applicable laws, including United States federal securities laws. Exchange of Series A QUIPS for Series A QUIDS Edison International will have the right at any time, in its sole discretion, to terminate the Trust. After the Trust has satisfied all liabilities to its creditors, as provided by law, the Property Trustee will distribute a Like Amount of Series A QUIDS to the holders of the Series A Trust Securities in exchange for all the outstanding Series A Trust Securities, in liquidation of the Trust. In this context, "Like Amount" means Series A QUIDS having an aggregate principal amount equal to the aggregate liquidation amount of all outstanding Series A Trust Securities. Edison International must use its best efforts to list the Series A QUIDS on the New York Stock Exchange or such other stock exchange or organization, if any, on which the Series A QUIPS are listed if an exchange distribution occurs. Exchange Procedures The Property Trustee will make the exchange distribution to holders of Series A QUIPS listed in the Trust's records at the close of business on the record date for the exchange distribution. If the Series A QUIPS are held in book-entry form, the record date will be one Business Day (as defined below) before the date that Edison International sets as the exchange distribution date (the "Exchange Date"). If the Series A QUIPS are not held in book-entry form, the record date will be the 15th day (whether or not a Business Day) before the Exchange Date. The Property Trustee will give you at least 30 days, but not more than 60 days, notice before the Exchange Date. The Property Trustee will give the notice of an Exchange Date in the manner described below under "--Notices." On the Exchange Date: . the Series A QUIPS will no longer be outstanding, . certificates representing a Like Amount of Series A QUIDS will be issued to holders of Series A QUIPS upon their surrender to the Property Agent or its agent for exchange, . any certificates representing Series A QUIPS that are not surrendered for exchange will be deemed to represent a Like Amount of Series A QUIDS (and until such certificates are surrendered for exchange, no payments of interest or principal on such Series A QUIDS will be made to the holders of those Series A QUIPS), and . the holders of Series A QUIPS will not have any further rights with respect to the Series A QUIPS, except the right to receive certificates representing Series A QUIDS upon surrender of their certificates as described above. Certain Tax Consequences Under current United States federal income tax law and interpretations and assuming, as we expect, that the Trust will not be classified as an association taxable as a corporation, you would not be taxed if the Property Trustee distributes the Series A QUIDS to you upon liquidation of the Trust. However, if a Tax Event were to occur and the Trust were subject to taxation on income received or accrued on the Series A QUIDS, you and the Trust could be taxed on that distribution. See "Material S-13 United States Federal Income Tax Considerations--Distribution of Series A QUIDS to Holders of Series A QUIPS Upon Liquidation of the Trust" in this prospectus supplement. Ranking The Series A QUIPS will rank equally with the Series A Common Securities. The Trust will make payments of distributions and the Redemption Price on the Series A QUIPS and the Series A Common Securities pro rata, based on the liquidation amounts of the Series A QUIPS and Series A Common Securities, except as follows. If a Subordinated Indenture Event of Default has occurred and has not been cured, the Trust will not make any payments on the Series A Common Securities until the Trust has paid in full or provided in full all unpaid amounts on the Series A QUIPS. If a Subordinated Indenture Event of Default occurs, the holders of the Series A Common Securities will be deemed to have waived all rights to act with respect to the related Trust Agreement Event of Default (as defined below) until all such Trust Agreement Events of Default have been cured, waived or eliminated. Until any such Trust Agreement Events of Default have been cured, waived or eliminated, the Property Trustee will act solely on your behalf (and not on behalf of the holders of the Series A Common Securities), and only you will have the right to direct the Property Trustee to act on your behalf. Trust Agreement Events of Default The term "Trust Agreement Event of Default" means any of the following: . a Subordinated Indenture Event of Default occurs (see "Description of Debt Securities--Events of Default" in the accompanying prospectus), . the Property Trustee does not pay any distribution within 30 days of its due date, provided that no extension period is continuing, . the Property Trustee does not pay any Redemption Price on its due date, . the Securities Trustees remain in breach in a material respect of any term of the Trust Agreement for 90 days after the Securities Trustees receive notice of default stating the trustees are in breach. The notice must be sent by the holders of at least 25% in liquidation amount of the outstanding Series A QUIPS, or . the Property Trustee files for bankruptcy or certain other events in bankruptcy or insolvency occur and a successor Property Trustee is not appointed within 60 days. Within 90 days after learning of a Trust Agreement Event of Default, the Property Trustee will notify the holders of the Series A Trust Securities, the Regular Trustees and Edison International, unless the Trust Agreement Event of Default has been cured or waived. Edison International and the Regular Trustees must provide the Property Trustee with an annual certificate stating whether they are in compliance with all the conditions and covenants applicable to them under the Trust Agreement. If a Trust Agreement Event of Default has occurred and has not been cured, the Series A QUIPS will have a preference in right of payment over the Series A Common Securities as discussed above. The holders of Series A Trust Securities are not entitled to accelerate the maturity of the Series A QUIPS upon a Trust Agreement Event of Default. S-14 Enforcement Rights If a Subordinated Indenture Event of Default occurs, the holders of Series A QUIPS must rely on the Property Trustee, as the holder of the Series A QUIDS, to enforce its rights under the Series A QUIDS and the Subordinated Indenture against Edison International, subject to the following: Right of Direct Action If Edison International does not make full and timely payments on the Series A QUIDS, the Trust will not have funds available to make payments of distributions or other amounts due on the Series A QUIPS. In this event, a holder of Series A QUIPS may sue Edison International directly to collect its pro rata share of payments owed. Edison International may not amend the Subordinated Indenture to remove the right of any holder of Series A QUIPS to bring a direct action against Edison International without the prior written consent of all of the holders of Series A QUIPS. Edison International will be able to set-off any payment made to a holder of Series A QUIPS in connection with a direct action. Other Rights under the Subordinated Indenture The holders of 25% or more in liquidation amount of the outstanding Series A QUIPS may accelerate the maturity of the Series A QUIDS when a Subordinated Indenture Event of Default has occurred and has not been cured and neither the Subordinated Indenture Trustee nor the holders of the Series A QUIDS have exercised such acceleration rights. In addition, the holders of a majority in liquidation amount of the outstanding Series A QUIPS may cancel a declaration of acceleration of the Series A QUIDS and may waive specified Subordinated Indenture Events of Default. See "Description of Debt Securities--Remedies" in the accompanying prospectus. Notices Notices to be given to holders of Series A QUIPS held in book-entry form will be given to DTC in accordance with its procedures. Notices to be given to holders of Series A QUIPS held in certificated form may be given by mail to their addresses set forth in the Trust's records. Payment and Paying Agency If the Series A QUIPS are held in book-entry form, distributions will be paid to DTC, which will credit the relevant accounts at DTC on the applicable distribution dates in accordance with its procedures. If the Series A QUIPS are issued in certificated form, distributions will be paid by check mailed to the address of the holder entitled to such payments, as such address appears in the Trust's records. The paying agent of the Trust (the "Paying Agent") will initially be the Property Trustee. Any Paying Agent may resign upon 30 days' written notice to the Regular Trustees and the Property Trustee. In such event, the Property Trustee will appoint a successor acceptable to the Regular Trustees to act as Paying Agent. Persons holding their Series A QUIPS in "Street Name" or indirectly through DTC should consult their banks or brokers for information on how they will receive payments. See "Book-Entry Issuance--"Street Name' and Other Indirect Holders" in this prospectus supplement. Any money paid to the Property Trustee or any Paying Agent for payments on the Series A QUIPS that remains unclaimed at the end of two years after the amount is due will be repaid to Edison International. After that two-year period, you may look only to Edison International for payment of those amounts. S-15 Business Day If any payment is due on a day that is not a Business Day, the payment will be made on the following Business Day (unless that Business Day is in a different calendar year, in which case the payment will be made on the preceding Business Day). Each payment made on the following or preceding Business Day will have the same force and effect as if made on the original payment due date. "Business Day" means any day other than a Saturday, a Sunday, a day on which banking institutions in New York City or Los Angeles, California are authorized or required by law or executive order to remain closed or a day on which the corporate trust office of the Property Trustee or the Subordinated Indenture Trustee is closed for business. Record Date The Trust will pay distributions to holders of Series A QUIPS listed in the Trust's records on the record date for the payment. If the Series A QUIPS are held in book-entry form, the record date will be one Business Day before the relevant distribution date. If the Series A QUIPS are issued in certificated form, the record date will be the 15th day, whether or not a Business Day, before the relevant distribution date. Registrar and Transfer Agent The Property Trustee will initially act as the Trust's agent for registering Series A QUIPS in the names of holders and transferring Series A QUIPS. The Property Trustee also will perform the role of maintaining the list of registered holders of Series A QUIPS. Holders will not be required to pay a service charge to transfer or exchange Series A QUIPS, but may be required to pay for any tax or other governmental charge associated with the exchange or transfer. S-16 DESCRIPTION OF THE SERIES A QUIDS This section describes the specific terms of the Series A QUIDS. This description supplements, and should be read together with, the description of the general terms and provisions of the Series A QUIDS set forth in the accompanying prospectus under the caption "Description of Debt Securities." The following description does not purport to be complete and is subject to, and is qualified in its entirety by reference to, the description in the accompanying prospectus and the Subordinated Indenture. We have filed a form of the Subordinated Indenture (including a form of supplemental indenture) as an exhibit to the Registration Statement of which the accompanying prospectus is a part. General Edison International will issue Series A QUIDS in denominations that are integral multiples of $25 and in an aggregate principal amount of $515,464,000 ($592,783,600, if the Underwriters' overallotment option is exercised in full). The Trust will use the proceeds from the sale of the Series A QUIPS to purchase the Series A QUIDS. The Property Trustee will hold legal title to the Series A QUIDS in trust for the benefit of the holders of the Series A Trust Securities. The Subordinated Indenture will be qualified as an indenture under the Trust Indenture Act. The Subordinated Indenture Trustee will act as indenture trustee for the Series A QUIDS, in order to comply with the provisions of the Trust Indenture Act. The Series A QUIDS are not secured by any property or assets of Edison International. The Series A QUIDS will rank junior in priority of payment to specified existing and future debt and other liabilities of Edison International which are described below under "--Subordination." Interest Interest will accrue on the Series A QUIPS from the date they are first issued at the annual rate of % of their principal amount. Unless deferred as described below, interest will be payable quarterly in arrears on August 31, November 30, February 28 and May 31 of each year (each, an "interest payment date"), beginning August 31, 1999. The amount of interest payable for any period will be computed on the basis of a 360-day year of twelve 30-day months. Extension Periods As long as no Subordinated Indenture Event of Default has occurred and has not been cured, Edison International will have the right to defer the payment of interest on the Series A QUIDS as described in "Description of the Series A QUIPS--Distributions" in this prospectus supplement. During an extension period, the holders of Series A QUIDS will continue to accrue interest at the rate stated above, plus will accrue additional interest on each deferred interest payment at the annual rate of %, compounded quarterly, from the corresponding interest payment date, to the extent permitted by law. Whenever we use the term "interest" with respect to the Series A QUIDS in this prospectus supplement, we are including any of this additional interest. Extension Period Restrictions During an extension period, Edison International and its subsidiaries may not take any of the following actions, except as described below: . declare or pay any dividend or other distribution on, redeem, purchase or acquire, or make a liquidation payment on any shares of Edison International's capital stock, S-17 . pay any amount on or repay, redeem or repurchase any debt securities issued by Edison International that rank equally with or junior to the Series A QUIDS, or . make any payments under any of Edison International's guarantees if such guarantee ranks equally with or junior to the Series A QUIDS and guarantees payments on any debt security of any of Edison International's subsidiaries. Notwithstanding the foregoing, Edison International may take any of the following actions during an extension period: . declare dividends in, or make any payment in, shares of common stock of Edison International, . purchase its common stock if related to the issuance of common stock under any of Edison International's benefit plans for its directors, officers or employees, or . declare a dividend in connection with any stockholder's rights plan, issue stock under such plan or repurchase any rights distributed pursuant to the plan. Extension Period Procedures Edison International will give the Property Trustee, the Regular Trustees and the Subordinated Indenture Trustee notice of its election to begin an extension period at least one Business Day before the earlier of: . the next distribution date for the Series A QUIPS, or . the date the Regular Trustees are required to give notice of the record date or the distribution date to (1) the New York Stock Exchange or other applicable self-regulatory organization or (2) the holders of the Series A QUIPS. The Subordinated Indenture Trustee must notify the holders of the Series A QUIDS in the manner described below in "--Notices" of Edison International's election to begin an extension period. Stated Maturity The Series A QUIDS initially will have a stated maturity of , 2029. However, Edison International may shorten the stated maturity to a date on or after , 2014. You should expect that Edison International will exercise this option if, for example, a tax development occurs that prohibits Edison International from deducting interest payments on the Series A QUIDS unless the Series A QUIDS have a shorter maturity date. Edison International also will have the option to extend the stated maturity to , 2048, if: . Edison International is not in bankruptcy, insolvent or in liquidation, . Edison International is not in default on the payment of interest or principal on the Series A QUIDS, . the Trust is not in arrears on payments of distributions on the Series A QUIPS, . no deferred distributions are accumulated on the Series A QUIPS, and . the Series A QUIPS are rated at least BBB- by Standard & Poor's Ratings Services or Baa3 by Moody's Investors Services, Inc. or an equivalent rating by a successor rating agency. S-18 You should assume that Edison International will exercise its option to extend the stated maturity if Edison International is unable to refinance at a lower interest rate or it is in the interest of Edison International to defer the stated maturity of the Series A QUIDS. Procedures Edison International will give notice to the Subordinated Indenture Trustee of its selection of a new stated maturity at least 30 days, but not more than 60 days, prior to the effective date of the change. The Subordinated Indenture Trustee will give holders of Series A QUIDS notice of the new stated maturity promptly upon its receipt of the notice from Edison International. The Subordinated Indenture Trustee will give the notice in the manner described below under "--Notices." Optional Redemption Edison International may redeem the Series A QUIDS, at its option, before their stated maturity as follows: . at any time on or after , 2004, in whole or in part, provided that no partial redemption may occur during an extension period, and . at any time in whole, but not in part, within 90 days after a Tax Event or an Investment Company Act Event has occurred. Edison International will pay the Redemption Price on the redemption date to the holders of Series A QUIDS to be redeemed. In this context, "Redemption Price" means the aggregate principal amount of the Series A QUIDS to be redeemed, plus any accrued and unpaid interest on those securities to the redemption date. Tax Event "Tax Event" means that Edison International receives an opinion of counsel, experienced in such matters, that as a result of any Tax Change, there is more than an insubstantial risk that: . the Trust is, or will be within 90 days after the date of the opinion of counsel, subject to United States federal income tax with respect to income received or accrued on the Series A QUIDS, . interest payable by Edison International or original issue discount accruing on the Series A QUIDS is not, or within 90 days after the date of the opinion, will not be, deductible by Edison International, in whole or in part, for United States federal income tax purposes, or . the Trust is, or will be within 90 days after the date of the opinion, subject to more than a minimal amount of other taxes, duties or governmental charges. As used above, "Tax Change" means any of the following that are enacted, promulgated or announced on or after the date of this prospectus supplement: . amendment to or change, including any announced prospective change, in the laws or any regulations under the laws of the United States or of any political subdivision or taxing authority of the United States, or . official administrative pronouncement or judicial decision interpreting or applying the laws or regulations stated above whether or not the pronouncement or decision is issued to or in connection with a proceeding involving Edison International or the Trust or is subject to review or appeal. S-19 Please see "Material United States Federal Income Tax Considerations-- Possible Tax Law Changes" in this prospectus supplement for a description of certain tax law developments that could result in a Tax Event. Investment Company Act Event "Investment Company Act Event" means that Edison International receives an opinion of counsel, experienced in such matters, that as a result of the occurrence of a change in law or regulation, or a written change in interpretation or application of law or regulation, by any legislative body, court, governmental agency or regulatory authority effective on or after the date of this prospectus supplement, there is more than an insubstantial risk that the Trust is or will be considered an "investment company" that is required to be registered under the Investment Company Act of 1940, as amended. Payment of Additional Sums If a Tax Event is continuing and Edison International does not elect to redeem the Series A QUIDS or liquidate the Trust, Edison International will pay additional amounts, if any, to the holders of the Series A QUIDS so that, notwithstanding any additional taxes, duties or charges imposed on the Trust because of a Tax Event, the Trust will have sufficient funds to pay the full amount of distributions due on the outstanding Series A Trust Securities. Redemption Procedures Edison International will give the holders of the Series A QUIDS at least 30 days, but not more than 60 days, notice before the redemption date, in the manner described below under "--Notices" in this prospectus supplement. In all other respects, the procedures for redeeming the Series A QUIDS will be similar to those for redeeming the Series A QUIPS. See "Description of the Series A QUIPS-- Redemption--Redemption Procedures" in this prospectus supplement. On the redemption date, interest will stop accruing on the Series A QUIDS called for redemption. However, if payment of the Redemption Price for any Series A QUIDS is not made, interest on those Series A QUIDS will continue to accrue to the date the Redemption Price is paid. Exchange of Series A QUIPS for Series A QUIDS Edison International will have the right at any time to terminate the Trust. In such event, the Property Trustee will distribute the Series A QUIDS to the holders of the Series A Trust Securities in exchange for their securities. See "Description of the Series A QUIPS--Exchange of Series A QUIPS for Series A QUIDS" in this prospectus supplement for the terms and procedures relating to such an exchange. Restrictions on Payments If any Series A QUIDS are outstanding, Edison International will be prohibited from taking specified actions described below if: . an event has occurred that constitutes a Subordinated Indenture Event of Default or, after notice or passage of time, or both, would constitute a Subordinated Indenture Event of Default, and Edison International has knowledge of such event but does not take reasonable steps to cure the default, . Edison International does not pay any amount due under the Series A QUIPS Guarantee relating to the Series A QUIPS, if the Series A QUIDS are held by the Trust, or S-20 . Edison International has given notice of its election to begin an extension period and has not rescinded such notice, or any extension period is continuing. In such event, Edison International may not take any of the following actions, except as described below: . declare or pay any dividend or other distribution on, redeem, purchase or acquire, or make a liquidation payment on any shares of Edison International's capital stock, . pay any amount on or repay, redeem or repurchase any debt securities issued by Edison International that rank equally with or junior to the Series A QUIDS, or . make any payments under any of Edison International's guarantees if such guarantee ranks equally with or junior to the Series A QUIDS and guarantees payments on any debt securities of any of Edison International's subsidiaries. Notwithstanding the foregoing, Edison International may: . declare dividends in, or make any payment in, shares of common stock of Edison International, . purchase its common stock if related to the issuance of common stock under any of Edison International's benefit plans for its directors, officers or employees, . declare a dividend in connection with any stockholder's rights plan, issue stock under such plan or repurchase any rights distributed pursuant to the plan, or . make payments under the Series A QUIPS Guarantee or any other Preferred Securities Guarantee (as defined in the accompanying prospectus). Consolidation, Merger and Conveyance of Assets as an Entirety Edison International is required to satisfy the conditions described under "Description of Debt Securities--Consolidation, Merger and Conveyance of Assets as an Entirety" in the accompanying prospectus, in order to consolidate with or merge into any other entity or convey, transfer or lease its properties and assets substantially as an entirety to any entity. In addition to these conditions, the successor entity must assume all of Edison International's obligations with respect to the Series A QUIPS Guarantee and Expense Agreement, and such transaction must be permitted under, and not give rise to any violation of, the Trust Agreement or the Series A QUIPS Guarantee. Modification of Subordinated Indenture The Subordinated Indenture may be modified, amended or supplemented under the circumstances described under "Description of Debt Securities--Modification of Indenture" in the accompanying prospectus. However, any amendment that adversely affects the holders of the Series A QUIPS in any material respect, as well as any termination of the Subordinated Indenture and any waiver of a Subordinated Indenture Event of Default, will require the consent of the holders of a majority in liquidation amount of the Series A QUIPS. Subordination The Series A QUIDS are subordinated securities and, as a result, the payment of principal, interest and any other amount on the Series A QUIDS is subordinated in right of payment to the prior payment in full of all of Edison International's Senior Debt. This means that in certain circumstances where Edison International may not be making payments on all of its debt obligations as they come due, the holders of all of Edison International's Senior Debt will be entitled to receive payment in full S-21 of all amounts that are due or will become due on the Senior Debt before holders of Series A QUIDS will be entitled to receive any amounts on the Series A QUIDS. These circumstances include: . Edison International makes a payment or distributes assets to creditors upon any liquidation, dissolution, winding up or reorganization of Edison International, or as part of an assignment or marshalling of Edison International's assets for the benefit of its creditors, . Edison International files for bankruptcy or certain other events in bankruptcy, insolvency or similar proceedings occur, or . the maturity of the Series A QUIDS is accelerated. (For example, the entire principal amount of the Series A QUIDS may be declared to be due and immediately payable or may be automatically accelerated due to a Subordinated Indenture Event of Default as described under "'Description of Debt Securities--Events of Default" in the accompanying prospectus.) In addition, Edison International is not permitted to make payments of principal, any interest or any other amounts on the Series A QUIDS if it defaults in its obligation to make payments on Senior Debt and does not cure such default, if an event of default that permits the holders of Senior Debt to accelerate the maturity of the Senior Debt occurs, or if any judicial proceeding is pending with respect to any of these defaults. These subordination provisions mean that if Edison International is insolvent, a holder of Edison International's Senior Debt may ultimately receive out of Edison International's assets more than a holder of Series A QUIDS. In this context, "Senior Debt" means the principal, any premium and interest on all of Edison International's indebtedness (including indebtedness of others that Edison International guarantees), whether such indebtedness exists now or is created, incurred or assumed by Edison International after the date of this prospectus supplement, that: . is for money Edison International borrows, . is a letter of credit, bankers' acceptance or similar obligation of Edison International, . is evidenced by a note or similar instrument that Edison International has given when it acquired any business, property or assets, . is issued or assumed by Edison International as the deferred purchase price of property or services (other than trade accounts payable or accrued liabilities arising in the ordinary course of Edison International's business), or . Edison International owes as a lessee under the leases that generally accepted accounting principles require Edison International to capitalize on its balance sheet or leases made as part of any sale and leaseback transaction it engages in. Senior Debt also includes any amendment, renewal, replacement, extension, modification or refunding of any indebtedness that itself was Senior Debt. However, Senior Debt does not include indebtedness: . that expressly states in the instrument creating or evidencing it that it does not rank senior in right of payment to the Series A QUIDS or to any other indebtedness of Edison International that ranks equally with or junior to the Series A QUIDS, . that is without recourse to Edison International at the time such debt was incurred (without respect to any election under Section 1111(b) of the Bankruptcy Code), . to any of Edison International's subsidiaries, or . to any of Edison International's employees not incurred in the ordinary course of business. S-22 Senior Debt does not include the Series A QUIDS. Because Edison International is a holding company, Edison International's right to participate in any asset distribution of any of its subsidiaries, on liquidation, reorganization or otherwise, will rank junior to rights of all creditors of that subsidiary (except to the extent that Edison International may itself be a creditor of that subsidiary). The rights of holders of Series A QUIDS to benefit from those distributions will also be junior to those prior claims. Consequently, the Series A QUIDS will be effectively subordinated to all liabilities of Edison International's subsidiaries. A holder of Series A QUIDS should look only to the assets of Edison International for payments on the Series A QUIDS. At March 31, 1999, Edison International had total liabilities of approximately $21.217 billion. Of this amount, approximately $6.770 billion would be Senior Debt of Edison International or liabilities of its subsidiaries that would effectively rank senior to the Series A QUIDS. During the second quarter of 1999, Edison International's subsidiaries issued the following additional Senior Debt: .$300 million of 6.65% notes due 2029 in April 1999 .$120 million of 6.0% preferred securities in May 1999 .$600 million of 7.73% senior notes due 2009 in June 1999 The Series A QUIDS, the Subordinated Indenture and the Series A QUIPS Guarantee do not limit Edison International's or any of its subsidiaries' ability to incur additional indebtedness, including indebtedness that ranks senior to the Series A QUIDS and the Series A QUIPS Guarantee. We expect that Edison International and its subsidiaries may incur substantial additional amounts of indebtedness in the future. Satisfaction and Discharge The Subordinated Indenture will cease to be of further effect, and Edison International will be deemed to have satisfied and discharged all of its obligations under the Subordinated Indenture, except as noted below, when: . all outstanding Series A QUIDS have become due or will become due within one year at their stated maturity or on a Redemption Date, and . Edison International deposits with the Indenture Trustee, in trust, funds and/or government obligations that are sufficient to pay and discharge all remaining indebtedness on the outstanding Series A QUIDS. Edison International will remain obligated to pay all other amounts due under to the Subordinated Indenture and to take certain ministerial tasks as described in the Subordinated Indenture. Payments Edison International will pay interest to the direct holders of Series A QUIDS listed in Edison International's records at the close of business on the record date, as discussed below, in advance of each interest payment date. If the Series A QUIDS are distributed in exchange for the Series A QUIPS, Edison International will make payments on the Series A QUIDS in accordance with procedures similar to those described under "Description of the Series A QUIPS--Payment and Paying Agents" in this prospectus supplement. Any money paid to the Subordinated Indenture Trustee or any paying agent, or held in trust by Edison International, for payments on any Series A QUIDS, that remains unclaimed at the end of two years after the amount is due will be repaid to Edison International. After that two-year period, a holder of Series A QUIDS may look only to Edison International for payment of those amounts. S-23 Business Day If any payment is due on a day that is not a Business Day, the payment will be made on the following Business Day unless that Business Day is in a different calendar year, in which case the payment will be made on the preceding Business Day. Each payment made on the following or preceding Business Day will have the same force and effect as if made on the original payment due date. Record Date If the Series A QUIDS are held in book-entry form, the record date will be one Business Day before the relevant interest payment date. If the Series A QUIDS are held in certificated form, the record date will be the 15th day, whether or not a Business Day, before the relevant interest payment date. Notices Notices to be given to holders of Series A QUIDS held in certificated form may be given by mail to their addresses as set forth in Edison International's records. Notices to be given to holders of Series A QUIDS held in book-entry form will be given to DTC in accordance with its procedures. BOOK-ENTRY ISSUANCE "Street Name" and Other Indirect Holders Investors who hold Series A QUIPS in accounts at banks or brokers will generally not be recognized by the Trust as legal holders of Series A QUIPS. This is called holding in "Street Name." Instead, the Trust would recognize only the bank or broker that directly holds, or the financial institution the bank or broker uses to hold, its Series A QUIPS. These intermediary banks, brokers and other financial institutions pass along distributions and other payments on the Series A QUIPS, either because they agree to do so in their customer agreements or because they are legally required to. If you hold Series A QUIPS in "Street Name," you should check with your own institution to find out: . how it handles securities payments and notices, . whether it imposes fees or charges, . how it would handle voting if ever required, . whether and how you can instruct it to send you Series A QUIPS registered in your own name so you can be a direct holder as described below, and . how it would pursue rights under the Series A QUIPS if there were a default or other event triggering the need for holders to act to protect their interests. Direct Holders The Trust's obligations, as well as the obligations of Edison International, the Securities Trustees and those of any third parties employed by the Trust, Edison International or the Securities Trustees, run only to individuals, corporations or other entities who are registered as holders of Series A QUIPS. As noted above, the Trust does not have obligations to you if you hold in "Street Name" or other indirect means, either because you choose to hold Series A QUIPS in that manner or because the Series A QUIPS are issued in the form of global securities as described below. For example, once the Trust makes payment to the registered holder, the Trust has no further responsibility for the payment even if that holder is legally required to pass the payment along to you as a "Street Name" customer but does not do so. S-24 Global Securities What is a Global Security? The Series A QUIPS will be issued in the form of global securities, and, therefore, the ultimate beneficial owners can only be indirect holders. The Trust does this by requiring that the global security be registered in the name of DTC or its nominee and by requiring that the Series A QUIPS included in the global security not be transferred in the name of any other direct holder unless the special circumstances described below occur. Any person wishing to own Series A QUIPS must do so indirectly by virtue of an account with a broker, bank or other financial institution that in turn has an account with DTC. Special Investor Considerations for Global Securities As an indirect holder, an investor's rights relating to a global security will be governed by the account rules of the investor's financial institution and of DTC, as the well as general laws relating to securities transfers. The Trust does not recognize this type of investor as a holder of Series A QUIPS and instead deals only with DTC or its nominee. See "--The DTC System" below. An investor should be aware that because Series A QUIPS are issued only in the form of global securities: . the investor cannot get Series A QUIPS registered in his or her own name, . the investor cannot receive physical certificates for his or her interest in the Series A QUIPS, . the investor will be a "Street Name" holder and must look to his or her own bank or broker for payments on the Series A QUIPS and protection of his or her legal rights relating to the Series A QUIPS (see "--"Street Name' and Other Indirect Holders" above), . the investor may not be able to sell interests in the Series A QUIPS to some insurance companies and other institutions that are required by law to own their securities in the form of physical certificates, . DTC's policies will govern payments, transfers, exchange and other matters relating to the investor's interest in the global security (see "--The DTC System" below; the Trust, Edison International and the Securities Trustees have no responsibility for any aspect of DTC's actions or for its records of ownership interests in the global security, nor do they supervise DTC in any way), and . payment for purchases and sales in the market for corporate bonds and notes is generally made in next-day funds. In contrast, DTC will usually require that interests in a global security be purchased or sold within its system using same-day funds. This difference could have some effect on how global security interests trade, but neither Edison International nor the Trust knows what that effect will be. Special Situations When Global Security Will Be Terminated In a few special situations, the global security will terminate and interests in it will be exchanged for physical certificates representing Series A QUIPS. After that exchange, the choice of whether to hold Series A QUIPS directly or in "Street Name" will be up to the investor. Investors must consult their own bank or brokers to find out how to have their interests in Series A QUIPS transferred to their own name, so that they will be direct holders. The rights of "Street Name" investors and direct holders in the Series A QUIPS are described above under "--"Street Name' and Other Indirect Holders" and "-- Direct Holders." S-25 The special situations for termination of a global security are: . DTC notifies Edison International or the Trust that it is unwilling, unable or no longer qualified to continue as the depositary for the Series A QUIPS, . Edison International in its sole discretion determines that the global security will be exchangeable for certificated Series A QUIPS, or . a Trust Agreement Event of Default has occurred and has not been cured and the holders of a majority in liquidation amount of the outstanding Series A QUIPS determine that the global security will be exchangeable for certificated Series A QUIPS. When a global security terminates, DTC (and not the Trust, Edison International or the Securities Trustees) is responsible for deciding the names of the institutions that will be the initial direct holders. The DTC System DTC has advised us that it is a limited-purpose trust company created to hold securities for its participating organizations (the "Participants"). DTC also facilitates the clearance and settlement between Participants of transactions of securities deposited with DTC through changes in the account records of its Participants. The Participants include securities brokers and dealers, banks, trust companies, clearing corporations and certain other organizations. The Underwriters are Participants of the DTC System. Access to DTC's system is also available to other entities such as securities brokers and dealers, banks and trust companies that work through a Participant (the "Indirect Participants"). When you purchase Series A QUIPS through the DTC system, the purchases must be made by or through a Participant, who will receive credit for the Series A QUIPS on DTC's records. Since you actually own the Series A QUIPS, you are the beneficial owner and your ownership interest will only be recorded on the Participants' or Indirect Participants' records. DTC has no knowledge of your individual ownership of the Series A QUIPS. DTC's records only show the identity of the Participants and the amount of the Series A QUIPS held by or through them. You will not receive a written confirmation of your purchase or sale or any periodic statement directly from DTC. You will receive these from your Participant or Indirect Participant. Thus the Participants or Indirect Participants are responsible for keeping accurate account of the holdings of their customers like you. Any redemption notices will be sent by Edison International and the Trust directly to DTC, who will in turn inform the Participants, who will then contact you as a beneficial holder. If less than all of the Series A QUIPS are being redeemed, DTC's current practice is to choose by lot the amount of the interest of each Participant to be redeemed. The Participant will then use an appropriate method to allocate the redemption price among its beneficial holders like you. It is DTC's current practice, upon receipt of any payment of distributions or liquidation amount, to credit Participants' accounts on the payment date based on their holdings of beneficial interests in the global securities as shown on DTC's records. In addition, it is DTC's current practice to assign any consenting or voting rights to Participants whose accounts are credited with Series A QUIPS on a record date, by using an omnibus proxy. Payments by Participants to owners of beneficial interests in the global securities, and voting by Participants, will be based on the customary practices between the Participants and owners of beneficial interests, as is the case with the Series A QUIPS held for the account of customers registered in "Street Name." However, payments will be the responsibility of the Participants and not of DTC, the Securities Trustees, the Trust or Edison International. We have obtained the information concerning DTC and DTC's book-entry system from sources that we believe to be accurate, but we are not responsible for the accuracy of this information. In S-26 addition, we are not responsible for the performance by DTC, its Participants or any Indirect Participants of any of their obligations. Registration of Series A QUIDS The Series A QUIDS initially will be issued in certificated form and registered in the name of the Property Trustee. If in the future the Series A QUIDS are distributed to the holders of Series A QUIPS in exchange for the Series A QUIPS and at that time the Series A QUIPS are represented by a global security, the Series A QUIDS would also be represented by a global security. In this event, we expect that the book-entry arrangements applicable to the Series A QUIPS would be similar to those applicable to the Series A QUIDS. S-27 MATERIAL UNITED STATES FEDERAL INCOME TAX CONSIDERATIONS General In the opinion of Latham & Watkins, counsel to Edison International and the Trust, the following is a summary of the material U.S. federal income tax consequences relating to the purchase, ownership and disposition of Series A QUIPS. This summary only addresses the tax consequences to a person that acquires Series A QUIPS on their original issue date at their original offering price and that is a United States Holder. A "United States Holder" is: . an individual citizen or resident of the United States, . a corporation organized under the laws of the United States, any state or the District of Columbia, . an estate the income of which is subject to U.S. federal income tax without regard to its source, or . a trust if a U.S. court is able to exercise primary supervision over administration of the trust and one or more U.S. persons have authority to control all substantial decisions of the trust. This summary does not purport to deal with all aspects of taxation that may be relevant to a holder in light of its personal investments or tax circumstances, or to holders who receive special treatment under the federal income tax laws, including, without limitation: . persons that are not United States Holders, except as described below under "--Non-United States Holders," . financial institutions, . insurance companies, . regulated investment companies, . real estate investment trusts, . tax exempt organizations, . broker-dealers, . persons that will hold Series A QUIPS as part of a position in a "straddle" or as part of a "hedging," "conversion" or other integrated investment transaction for U.S. federal income tax purposes, . persons whose functional currency is not the U.S. dollar, or . persons that do not hold Series A QUIPS as capital assets. This summary is based upon the U.S. Internal Revenue Code of 1986, as amended (the "Code"), Treasury regulations, Internal Revenue Service rulings and pronouncements and judicial decisions now in effect, all of which are subject to change at any time. These changes may be applied retroactively in a manner that could cause the tax consequences to vary substantially from the consequences described below, possibly having an adverse affect on a beneficial owner of Series A QUIPS. The authorities on which this summary is based are subject to various interpretations, and it is possible that the U.S. federal income tax treatment of the purchase, ownership and disposition of Series A QUIPS may differ from the treatment described below. You are advised to consult with your own tax advisors in light of your own particular circumstances as to the U.S. federal tax consequences of the purchase, ownership and S-28 disposition of Series A QUIPS, as well as the effect of any state, local or foreign tax laws and potential changes in applicable tax laws. Classification of the Series A QUIDS and the Trust Edison International, the Trust and the holders of the Series A QUIPS (by the acceptance of a beneficial interest in a Series A QUIPS) have agreed to treat the Series A QUIDS as indebtedness for all United States tax purposes and the Series A QUIPS as evidence of an indirect beneficial ownership interest in the Series A QUIDS. Given such treatment and assuming full compliance with the terms of the Trust Agreement, the Indenture and certain other documents, the Trust will be treated as a "grantor trust" and not as an association taxable as a corporation and the Series A QUIDS will be treated as indebtedness for U.S. federal income tax purposes. As a result, each beneficial owner of Series A QUIPS will be required to include in its gross income its pro rata share of the interest income, including original issue discount ("OID"), paid or accrued with respect to the Series A QUIDS, whether or not cash is actually distributed to the holders. See "--Interest Income and Original Issue Discount" below. Interest Income and Original Issue Discount Under Treasury regulations applicable to debt instruments issued on or after August 13, 1996, a "remote" contingency that stated interest will not be timely paid will be ignored in determining whether such debt instrument is issued with OID. As a result of terms and conditions of the Series A QUIDS that prohibit certain payments with respect to Edison International's capital stock and indebtedness if Edison International elects to extend interest payment periods, Edison International believes that the likelihood of its exercising its option to defer payments is remote. See "Description of the Series A QUIPS--Distributions." Based on the foregoing, Edison International believes that the Series A QUIDS will not be considered to be issued with OID at the time of their original issuance. Accordingly, the following discussion assumes that unless and until Edison International exercises its option to defer any payment of interest, the Series A QUIDS will not be treated as issued with OID. Under the Treasury regulations, if Edison International exercises its option to defer any payment of interest, the Series A QUIDS would at that time be treated as issued with OID, and all stated interest on the Series A QUIDS would thereafter be treated as OID as long as the Series A QUIDS remained outstanding. In this event, all of a holder's taxable interest income with respect to the Series A QUIDS would be accounted for as OID on an economic accrual basis regardless of such holder's method of tax accounting, and actual distributions of stated interest would not be reported as taxable income. Consequently, a holder would be required to include OID in gross income even though Edison International would not make any actual cash payments during an Extension Period. The Regulations have not been addressed in any rulings or other interpretations by the IRS, and it is possible that the IRS could take a position contrary to the interpretation described above. Because income on the Series A QUIPS will constitute interest or OID, corporate United States Holders of the Series A QUIPS will not be entitled to a dividends-received deduction with respect to any income taken into account with respect to the Series A QUIPS. Subsequent uses of the term "interest" in this summary include income in the form of OID. Distribution of Series A QUIDS to Holders of Series A QUIPS Upon Liquidation of the Trust A distribution by the Trust of the Series A QUIDS as described under the caption "Description of the Series A QUIPS--Exchange of Series A QUIPS for Series A QUIDS" will be nontaxable. This distribution will result in the holder of Series A QUIPS receiving directly its pro rata share of the Series A QUIDS, with a holding period and aggregate tax basis equal to the aggregate tax basis the holder had in its Series A QUIPS before the distribution. S-29 If, however, the liquidation of the Trust were to occur because the Trust is subject to U.S. federal income tax with respect to income accrued or received on the Series A QUIDS, the distribution of Series A QUIDS to a holder of Series A QUIPS would be a taxable event to the Trust and each holder of Series A QUIPS, and each such holder would recognize gain or loss as if the holder had exchanged its Series A QUIPS for the Series A QUIDS upon liquidation of the Trust. A holder of Series A QUIPS will include interest in income in respect of Series A QUIDS received from the Trust in the manner described above under "--Interest Income and Original Issue Discount." Sale or Redemption of Series A QUIPS A holder that sells Series A QUIPS, including through a redemption for cash, will recognize gain or loss equal to the difference between such holder's adjusted tax basis in the Series A QUIPS and the amount realized on the sale of such Series A QUIPS. Assuming that Edison International does not defer interest payments on the Series A QUIDS, a holder's adjusted tax basis in the Series A QUIPS generally will be its initial purchase price. If the Series A QUIDS are deemed to be issued with OID as a result of Edison International's deferral of interest payments, a holder's adjusted tax basis in the Series A QUIPS generally will be its initial purchase price, increased by OID previously includible in such United States Holder's gross income to the date of disposition and decreased by distributions or other payments received on the Series A QUIPS from, and including, the date of the first Extension Period. This gain or loss generally will be a capital gain or loss, except to the extent any amount realized is treated as a payment of accrued interest with respect to such holder's pro rata share of the Series A QUIDS required to be included in income, and generally will be long-term capital gain or loss if the Series A QUIPS have been held for more than one year. Long-term capital gain of a non-corporate holder is generally subject to a maximum tax rate of 20%. If Edison International defers any interest payment on the Series A QUIDS, the Series A QUIPS may trade at a price that does not fully reflect the value of accrued but unpaid interest with respect to the Series A QUIDS. A holder who sells its Series A QUIPS between record dates for payments of distributions will be required to include accrued but unpaid interest on the Series A QUIDS through the date of disposition as ordinary income and to add the amount of the accrued but unpaid interest to its adjusted tax basis in the Series A QUIPS. To the extent the selling price is less than the holder's adjusted tax basis, such holder will recognize a capital loss. Subject to certain limited exceptions, a holder cannot offset ordinary income against capital losses for U.S. federal income tax purposes. Backup Withholding Tax and Information Reporting for United States Holders The amount of interest income paid and OID accrued on the Series A QUIPS held of record by United States Holders, other than corporations and other exempt United States Holders, will be reported to the IRS. "Backup" withholding at a rate of 31% will apply to payments of interest to a non-exempt United States Holder unless the United States Holder furnishes its taxpayer identification number in the manner prescribed in applicable Treasury regulations, certifies that such number is correct, certifies as to no loss of exemption from backup withholding and meets certain other conditions. Payment of the proceeds from the disposition of Series A QUIPS to or through the U.S. office of a broker is subject to information reporting and backup withholding unless the holder establishes an exemption from information reporting and backup withholding. Any amounts withheld from a holder under the backup withholding rules will be allowed as a refund or a credit against such holder's U.S. federal income tax liability, provided the required information is furnished to the IRS. S-30 It is anticipated that income on the Series A QUIPS will be reported to holders on Form 1099, and mailed to holders of the Series A QUIPS by January 31 following each calendar year. Possible Tax Law Changes You should be aware that legislation has been proposed by the Clinton Administration in the past that, if enacted, would have denied an interest expense deduction to issuers of instruments such as the Series A QUIDS. While legislation of that kind is not currently pending, we can give no assurance that similar legislation will not ultimately be enacted into law, or that other developments will not occur on or after the date of this prospectus supplement that would adversely affect the tax treatment of the Series A QUIDS or the Trust. Changes of that kind also could give rise to a Tax Event. Non-United States Holders A "Non-United States Holder" is a person who is not a United States Holder. Please note that if you pay federal income tax on a net basis on income or gain with respect to the Series A QUIPS because such income or gain is effectively connected with the conduct of a United States trade or business, this disclosure does not cover the United States federal tax rules that apply to you. Payments by the Trust to any holder of Series A QUIPS who or which is a Non-United States Holder will generally not be subject to U.S. federal income tax or withholding tax, provided that: (1) the beneficial owner of the Series A QUIPS does not actually or constructively own 10 percent or more of the total combined voting power of all classes of voting stock of Edison International, (2) the beneficial owner of the Series A QUIPS is not a controlled foreign corporation that is related to Edison International through stock ownership, and (3) either (A) the beneficial owner of the Series A QUIPS certifies to the Trust, under penalty of perjury, that it is not a United States Holder and provides its name and address on a Form W-8 or suitable substitute form, or (B) a securities clearing organization, bank or other financial institution that holds customers' securities in the ordinary course of its trade or business, and holds the Series A QUIPS in such capacity, certifies to the Trust, under penalty of perjury, that it has received such statement from the beneficial owner or from another entity described in B between it and the beneficial owner and furnishes the Trust with a copy thereof. A Non-United States Holder of a Series A QUIPS will generally not be subject to U.S. federal income tax or withholding tax on any gain realized upon the sale, redemption, retirement, or other disposition of a Series A QUIPS (other than gain attributable to accrued interest, which is addressed in the preceding paragraph) unless: (1) the Non-United States Holder is an individual who is present in the U.S. for 183 days or more during the taxable year and meets certain other conditions; or (2) the Non-United States Holder is subject to tax under provisions of U.S. tax law applicable to U.S. expatriates, including former citizens or residents of the United States. Treasury regulations that are generally effective with respect to payments after December 31, 2000, would provide alternative methods for satisfying the certification requirement described in clauses (3)(A) and (3)(B) above. Such regulations also would require, in the case of Series A QUIPS held by a foreign partnership, that: . the certification described in clause (3) above be provided by the partners rather than by the foreign partnership, and S-31 . the partnership provides certain information, including a U.S. taxpayer identification number. A look-through rule would apply in the case of tiered partnerships. Backup Withholding and Information Reporting for Non-United States Holders If a Non-United States Holder receives payments of interest or principal directly from us or through the United States office of a custodian, nominee, agent or broker, there is the possibility that both backup withholding at a rate of 31% and information reporting will apply to such payments. With respect to interest payments made on the Series A QUIPS, however, backup withholding and information reporting will not apply if you certify, generally on a Form W- 8 or substitute form, that you are not a United States person for United States federal income tax purposes. Moreover, backup withholding or information reporting generally will not apply to proceeds received on the sale, exchange, redemption, or other disposition of the Series A QUIPS, if a Non-United States Holders properly provides, generally on Form W-8 or a substitute form, a statement that he or she is an "exempt foreign person" for purposes of the broker reporting rules and other required information. If a Non-United States Holder is not required to pay United States federal income or withholding tax on the sale or other disposition of the Series A QUIPS, as described above under "Non-United States Holders," he or she will generally qualify as an "exempt foreign person" for purposes of the broker reporting rules. If payments of principal and interest are made to a Non-United States Holder outside the United States by or through the foreign office of its foreign custodian, nominee or other agent, or if such Non-United States Holder receives the proceeds of the sale of the Series A QUIPS through a foreign office of a "broker," as defined in the pertinent Treasury regulations, backup withholding or information reporting will generally not apply to such payments. Backup withholding and information reporting will apply, however, if the foreign custodian, nominee, agent or broker has actual knowledge or reason to know that the payee is a United States person. Information reporting, but not backup withholding, will apply to payments if the payment is made by a foreign office of a custodian, nominee, agent or broker that is a United States person or a controlled foreign corporation for United States federal income tax purposes, or that derives 50% or more of its gross income from the conduct of a United States trade or business for a specified three year period, unless the broker has in its records documentary evidence that you are a Non-United States Holder and other conditions specified in the Code are met. Any amounts withheld under the backup withholding rules may be refunded or credited against the Non-United States Holder's United States federal income tax liability, provided the required information is furnished to the IRS. New Backup Withholding Regulations New regulations relating to withholding tax on income paid to foreign persons will generally be effective for payments made after December 31, 2000, subject to some transition rules. The new withholding regulations modify and, in general, unify the way in which a Non-United States Holder establishes its status as a Non-United States "beneficial owner" eligible for withholding exemptions including the portfolio interest exemption, a reduced treaty rate or an exemption from backup withholding. For example, the new regulations will require new forms, which you will generally have to provide earlier than you would have had to provide replacements for expiring existing forms. The new withholding regulations clarify withholding agents' reliance standards. They also require additional certifications for claiming treaty benefits. The new withholding regulations also provide somewhat different procedures for foreign intermediaries and flow-through entities, such as foreign partnerships, to claim the benefit of applicable exemptions on behalf of non-United States S-32 beneficial owners for which or for whom they receive payments. The new withholding regulations also amend the foreign broker office definition as it applies to partnerships. When a Non-United States Holder purchases the Series A QUIPS, he or she will be required to submit certification that complies with the temporary Treasury regulations in order to obtain an available exemption from or reduction in withholding tax. The new withholding regulations provide that certifications satisfying the requirements of the new withholding regulations will be deemed to satisfy the requirement of the Treasury regulations now in effect. In any case, the Non-United States Holder must provide certifications that comply with the provisions of the new withholding regulations, where required, not later than December 31, 2000, if the United States Holder remains as a holder on such date, unless the Non-United States Holder receives payments on the Series A QUIPS through a qualified intermediary, as defined in the new withholding regulations, that has provided a proper certification on the Non- United States Holder's behalf. If the Non-United States Holder is claiming a benefit under an income tax treaty and not relying on the portfolio interest exemption, such holder should be aware that he or she may be required to obtain a taxpayer identification number and to certify your eligibility under the applicable treaty's limitations on benefits article in order to comply with the new withholding regulations' certification requirements. The new withholding regulations are complex and this summary does not completely describe them. Please consult your tax advisor to determine how the new withholding regulations will affect your particular circumstances. S-33 UNDERWRITING Edison International, the Trust and the underwriters for the offering (the "Underwriters") named below have entered into an underwriting agreement with respect to the Series A QUIPS being offered. Subject to certain conditions, each Underwriter has severally agreed to purchase the number of Series A QUIPS indicated in the following table. Goldman, Sachs & Co., A.G. Edwards & Sons, Inc., Lehman Brothers Inc., Merrill Lynch, Pierce, Fenner & Smith Incorporated, Morgan Stanley & Co. Incorporated, PaineWebber Incorporated, Prudential Securities Incorporated and Salomon Smith Barney Inc. are the representatives of the Underwriters.
Number of Underwriter Series A QUIPS ----------- -------------- Goldman, Sachs & Co........................................ A.G. Edwards & Sons, Inc. ................................. Lehman Brothers Inc. ...................................... Merrill Lynch, Pierce, Fenner & Smith Incorporated......................................... Morgan Stanley & Co. Incorporated.......................... PaineWebber Incorporated................................... Prudential Securities Incorporated......................... Salomon Smith Barney Inc. ................................. --- Total.................................................... ===
If the Underwriters sell more Series A QUIPS than the total number set forth in the table above, the Underwriters have an option to buy up to an additional 3,000,000 Series A QUIPS from the Trust to cover such sales. They may exercise that option for 30 days. If any Series A QUIPS are purchased pursuant to this option, the Underwriters will severally purchase Series A QUIPS in approximately the same proportion as set forth in the table above. Because the Trust will invest the proceeds from the sale of the Series A QUIPS in the Series A QUIDS issued by Edison International, the underwriting agreement provides that Edison International will pay underwriting commissions to the Underwriters, as compensation. The following table shows the per Series A QUIPS and total underwriting commissions to be paid to the Underwriters by Edison International. Such amounts are shown assuming both no exercise and full exercise of the Underwriters' option to purchase 3,000,000 additional Series A QUIPS.
Paid by Edison International ------------------------- No Exercise Full Exercise ----------- ------------- Per Series A QUIPS.................................... $ $ Total................................................. $ $
The Underwriters propose to offer the Series A QUIPS to the public initially at the initial public offering price set forth on the cover page of this prospectus supplement. Any Series A QUIPS sold by the Underwriters to securities dealers may be sold at a discount of up to $ per Series A QUIPS from the initial public offering price. Any of those securities dealers may resell the Series A QUIPS they purchase from the Underwriters to other brokers and dealers at a discount of up to $ per Series A QUIPS from the initial public offering price. If all the Series A QUIPS are not sold at the initial public offering price, the representatives of the Underwriters may change the offering price and other selling terms. Edison International and the Trust have agreed with the Underwriters, during the period beginning from the date of the underwriting agreement and continuing to and including the earlier of S-34 (i) the termination of trading restrictions on the Series A QUIPS, as determined by the representatives of the Underwriters, and (ii) 30 days after the last Time of Delivery (as defined in the underwriting agreement), not to offer, sell, contract to sell or otherwise dispose of any preferred securities, any other beneficial interests in the assets of any trust, or any preferred securities or any other securities of any trust or Edison International, as the case may be, that are substantially similar to the Series A QUIPS (including any guarantee of such securities) or any securities that are convertible into or exchangeable for, or that represent the right to receive, preferred securities or any such substantially similar securities of any trust or Edison International, or any debt securities of Edison International (other than the Series A QUIPS) which mature more than one year after such Time of Delivery and which are substantially similar to the Series A QUIPS, without the prior written consent of the representatives of the Underwriters. Prior to this offering, there has been no public market for the Series A QUIPS. Edison International and the Trust have applied for listing the Series A QUIPS on the New York Stock Exchange. If approved, trading in the Series A QUIPS on the New York Stock Exchange is expected to begin within the 30-day period after the initial delivery of the Series A QUIPS. In order to meet one of the requirements for listing the Series A QUIPS, the Underwriters have undertaken to sell the Series A QUIPS to a minimum of 400 beneficial owners. The representatives of the Underwriters have advised Edison International and the Trust that they intend to make a market in the Series A QUIPS prior to the commencement of trading on the New York Stock Exchange, but are not obligated to do so and may discontinue market making at any time without notice. No assurance can be given as to the liquidity of the trading market for the Series A QUIPS. In connection with the offering, the Underwriters may purchase and sell the Series A QUIPS in the open market. These transactions may include short sales, stabilizing transactions and purchases to cover positions created by short sales. Short sales involve the sale by the Underwriters of a greater number of Series A QUIPS than they are required to purchase in the offering. Stabilizing transactions consist of certain bids or purchases made for the purpose of preventing or retarding a decline in the market price of the Series A QUIPS while the offering is in progress. The Underwriters also may impose a penalty bid. This occurs when a particular Underwriter repays to the Underwriters a portion of the underwriting commissions received by it because the Underwriters have repurchased Series A QUIPS sold by or for the account of such Underwriter in stabilizing or short covering transactions. These activities by the Underwriters may stabilize, maintain or otherwise affect the market place of the Series A QUIPS. As a result, the price of the Series A QUIPS may be higher than the price that otherwise might exist in the open market. If these activities are commenced, they may be discontinued by the Underwriters at any time. These transactions may be effected on the New York Stock Exchange, in the over-the-counter market or otherwise. Edison International estimates that its share of the total expenses of this offering, excluding underwriting discounts and commissions, will be approximately $ . Edison International and the Trust have agreed to indemnify the several Underwriters against specified liabilities, including liabilities under the Securities Act of 1933, as amended, and to contribute to amounts paid by the Underwriters if the indemnification provided is unavailable or insufficient. Certain of the Underwriters or their affiliates have provided from time to time, and expect to provide in the future, investment or commercial banking services to Edison International and its affiliates, for which such Underwriters or their affiliates have received or will receive customary fees and commissions. S-35 VALIDITY OF SERIES A QUIPS, SERIES A QUIDS AND SERIES A QUIPS GUARANTEE Matters of Delaware law relating to the validity of the Series A QUIPS will be passed upon on behalf of Edison International and the Trust by Richards, Layton & Finger P.A., Wilmington, Delaware, special Delaware counsel to Edison International and the Trust. The validity of the Series A QUIDS and the Series A QUIPS Guarantee will be passed upon on behalf of Edison International by Kenneth S. Stewart, Assistant General Counsel of Edison International. Latham & Watkins, Los Angeles, California will pass upon matters relating to United States federal income tax considerations. Certain legal matters will be passed upon for the Underwriters by Cleary, Gottlieb, Steen & Hamilton, New York, New York. S-36 ++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++ +The information in this prospectus is not complete and may be changed. We may + +not sell these securities until the registration statement filed with the + +Securities and Exchange Commission is effective. This prospectus is not an + +offer to sell these securities and it is not soliciting an offer to buy these + +securities in any state where the offer or sale is not permitted. + ++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++ Subject to Completion, Dated July 13, 1999 PROSPECTUS [LOGO OF EDISON INTERNATIONAL(SM)] $2,500,000,000 Edison International Debt Securities, Common Stock, Preferred Stock and Guarantees EIX Trust I EIX Trust II EIX Trust III Preferred Securities Guaranteed by Edison International ------------ We may offer and sell the securities from time to time in one or more offerings. This prospectus provides you with a general description of the securities we may offer. Each time we sell securities we will provide a supplement to this prospectus that contains specific information about the offering and the terms of the securities. The supplement may also add, update or change information contained in this prospectus. You should carefully read this prospectus and any supplement before you invest in any of our securities. Edison International Edison International may offer and sell the following securities: . debt securities . common stock . preferred stock . guarantees of preferred securities The Trusts EIX Trust I, EIX Trust II and EIX Trust III may offer and sell preferred securities, guaranteed by Edison International. ------------ Neither the Securities and Exchange Commission nor any state securities commission has approved or disapproved of these securities or passed upon the adequacy or accuracy of this prospectus. Any representation to the contrary is a criminal offense. The date of this prospectus is , 1999. TABLE OF CONTENTS
Page ---- About This Prospectus..................................................... 3 Forward-Looking Statements................................................ 3 Where You Can Find More Information....................................... 4 Edison International...................................................... 5 The Trusts................................................................ 6 Use of Proceeds........................................................... 7 Ratio of Edison International Earnings to Fixed Charges and Preferred Stock Dividends.......................................................... 7 Description of Securities................................................. 8 Description of Debt Securities............................................ 8 Description of Edison International's Common Stock and Preferred Stock.... 17 Description of Preferred Securities....................................... 20 Description of Preferred Securities Guarantees............................ 27 Description of Expense Agreements......................................... 29 Relationship Among Preferred Securities, Preferred Securities Guarantees and Subordinated Debt Securities Held By Each Trust...................... 29 Experts................................................................... 30 Validity of the Securities and the Preferred Securities Guarantees........ 30 Plan of Distribution...................................................... 30
2 ABOUT THIS PROSPECTUS This prospectus is part of a "shelf" registration statement that we filed with the United States Securities and Exchange Commission, or the "SEC." By using a shelf registration statement, we may sell up to $2,500,000,000 offering price of any combination of the securities described in this prospectus from time to time and in one or more offerings. This prospectus only provides you with a general description of the securities that we may offer. Each time we sell securities, we will provide a supplement to this prospectus that contains specific information about the terms of the securities. The supplement may also add, update or change information contained in this prospectus. Before purchasing any securities, you should carefully read both this prospectus and any supplement, together with the additional information described under the heading "Where You Can Find More Information." This prospectus does not contain separate financial statements for the trusts. Edison International files consolidated financial information with the SEC that includes each of the trusts. The trusts do not have any independent function other than to issue securities and to purchase subordinated debt securities from Edison International. We do not believe that additional financial information regarding the trusts would be useful to you. You should rely only on the information contained or incorporated by reference in this prospectus and in any supplement. We have not authorized any other person to provide you with different information. If anyone provides you with different or inconsistent information, you should not rely on it. We will not make an offer to sell these securities in any jurisdiction where the offer or sale is not permitted. You should assume that the information appearing in this prospectus and the supplement to this prospectus is accurate as of the dates on their covers. Our business, financial condition, results of operations and prospects may have changed since that date. FORWARD-LOOKING STATEMENTS This prospectus, any accompanying prospectus supplement and the additional information described under the heading "Where You Can Find More Information" may contain forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. These statements are subject to risks and uncertainties and are based on the beliefs and assumptions of our management, based on information currently available to our management. When we use words such as "believes," "expects," "anticipates," "intends," "plans," "estimates," "should" or similar expressions, we are making forward-looking statements. Forward-looking statements include the information concerning possible or assumed future results of operations set forth under "Business" and "Management's Discussion and Analysis of Financial Condition and Results of Operations" in our Annual Report on Form 10-K, under the same or similar headings in our Quarterly Reports on Form 10-Q, and in our Current Reports on Form 8-K, incorporated by reference into this prospectus. Forward-looking statements are not guarantees of performance. They involve risks, uncertainties and assumptions. Our future results and shareholder value may differ materially from those expressed in these forward-looking statements. Many of the factors that will determine these results and value are beyond our ability to control or predict. These statements are necessarily based upon various assumptions involving judgments with respect to the future including, among others, our ability to achieve synergies and revenue growth, national, international, regional and local economic, competitive and regulatory conditions and developments, technological developments, capital market conditions, inflation rates, foreign currency exchange rates and valuations, interest rates, energy markets, weather conditions, business and regulatory or legal decisions, the pace of deregulation of retail natural gas and electricity, the timing and extent of changes in commodity prices for oil, natural gas and electricity, the timing and success of business development efforts, new or increased 3 environmental liabilities, the effects of Year 2000-related computer problems, and other uncertainties, all of which are difficult to predict and many of which are beyond our control. You are cautioned not to put undue reliance on any forward-looking statements. For those statements, we claim the protection of the safe harbor for forward-looking statements contained in the Private Securities Litigation Reform Act of 1995. You should also consider any other factors contained in this prospectus or in any accompanying supplement, including the information incorporated by reference into this prospectus or into any accompanying supplement. WHERE YOU CAN FIND MORE INFORMATION Available Information Edison International files reports, proxy statements and other information with the SEC. Information filed with the SEC by Edison International can be inspected and copied at the Public Reference Room maintained by the SEC and at the Regional Offices of the SEC as follows: Public Reference Room New York Regional Office Chicago Regional Office 450 Fifth Street, N.W. 7 World Trade Center Citicorp Center Room 1024 Suite 1300 500 West Madison Street Washington, D.C. 20549 New York, New York 10048 Suite 1400 Chicago, Illinois 60661- 2551 You may also obtain copies of this information by mail from the Public Reference Section of the SEC, 450 Fifth Street, N.W., Room 1024, Washington, D.C. 20549, at prescribed rates. Further information on the operation of the SEC's Public Reference Room in Washington, D.C. can be obtained by calling the SEC at 1-800-SEC-0330. The SEC also maintains a web site that contains reports, proxy statements and other information about issuers, such as Edison International, who file electronically with the SEC. The address of that site is http://www.sec.gov. Edison International's common stock is listed on the New York Stock Exchange (NYSE: EIX), and reports, proxy statements and other information concerning Edison International can also be inspected at the offices of the New York Stock Exchange at 20 Broad Street, New York, New York 10005. In addition, reports, proxy statements and other information concerning Edison International can be inspected at its offices at 2244 Walnut Grove Avenue, Rosemead, California 91770. You also can obtain copies of some of the above reports and other information at the web site maintained by Edison International. The address of that web site is http://www.edison.com. This prospectus is part of a registration statement that we filed with the SEC. The full registration statement may be obtained from the SEC or Edison International, as indicated below. Forms of the indentures, the trust agreements and other documents establishing the terms of the offered securities and the guarantees are filed as exhibits to the registration statement. Statements in this prospectus about these documents are summaries. You should refer to the actual documents for a more complete description of the relevant matters. Incorporation by Reference The rules of the SEC allow us to "incorporate by reference" information into this prospectus, which means that we can disclose important information to you by referring you to another document filed separately with the SEC. The information incorporated by reference is deemed to be part of this prospectus, and later information that we file with the SEC will automatically update and supersede that information. The prospectus incorporates by reference the documents set forth below that we have previously filed with the SEC. These documents contain important information about Edison International. 4
Sec Filings (File No. 1-9936) Period ----------------------------- ------ Annual Report on Form 10-K Year ended December 31, 1998 Quarterly Report on Form 10-Q Quarter ended March 31, 1999 Current Report on Form 8-K Filed April 5, 1999 Current Report on Form 8-K Filed July 2, 1999 Registration Statement on Form 8-A Filed November 21, 1996 The "Description of Registrant's Filed by SCEcorp (former name of Edison Securities to be Registered" on International) on May 20, 1988 pages 4-5 of the Registration Statement on Form 8-B
We are also incorporating by reference all additional documents that we file with the SEC under Sections 13(a), 13(c), 14 or 15(d) of the Securities Exchange Act of 1934, as amended, between the date of this prospectus and the termination of the offering of securities described in this prospectus. Upon request, Edison International will provide without charge to each person to whom a copy of this prospectus has been delivered a copy of any and all of these filings. You may request a copy of these filings by writing or telephoning us at: Edison International 2244 Walnut Grove Avenue (P.O. Box 999) Rosemead, California 91770 Attention: Corporate Governance Telephone: (626) 302-2662 EDISON INTERNATIONAL Edison International is a multinational corporation and a global leader in energy production and distribution, and in energy and infrastructure finance. Headquartered in Rosemead, California, Edison International has regional offices in New York, Washington, D.C., Australia, Indonesia, the Philippines, Singapore, Italy, Spain, Turkey and the United Kingdom. Edison International was incorporated on April 20, 1987, under the laws of the State of California for the purpose of becoming the parent holding company of Southern California Edison Company, a California public utility corporation. As of December 31, 1998, Edison International directly or indirectly owned all of the issued and outstanding common stock of Southern California Edison Company and of other subsidiaries engaged in nonutility businesses. Edison International's combined assets total nearly $27 billion. The regulated utility and the nonutility subsidiaries are: . Southern California Edison, one of the nation's largest investor-owned electric utilities, serving approximately 11 million people within an approximate 50,000-square-mile area in central, coastal and Southern California. Based in Rosemead, California, the regulated utility is a recognized leader in cutting-edge research and technology and for providing reliable electrical service in its region for more than a century. The company has assets of nearly $17 billion. . Edison Mission Energy, specializing in the development, acquisition, construction management and operation of global power production facilities. Based in Irvine, California, it is among the world's leading power producers with assets of nearly $7 billion and investments in approximately 58 projects currently operating in Australia, New Zealand, Spain, Turkey, the United Kingdom and the United States, and plants under construction in Australia, Indonesia, Italy, New Zealand, Thailand, and the United States (Puerto Rico). In total, these projects represent nearly 15,000 megawatts of generating capacity. 5 . Edison Capital, a provider of capital and financial services for global energy, infrastructure and affordable housing projects. Headquartered in Irvine, California, it has assets of approximately $2.5 billion. The company has investments in energy and infrastructure projects in the United States, Latin America, Australia, Europe, Asia and Africa and is one of the nation's leading investors in affordable housing developments eligible for tax credits. . Mission Land Company, which is in the business of managing and selling real estate projects. . Edison Enterprises, a provider of products and services for commercial, retail and utility markets. Based in San Dimas, California, it offers energy management services for business customers, electrical and appliance repair and home security services to residential consumers, and a wide range of services to utilities both in the U.S. and in Canada. Edison International is engaged in the business of holding, for investment, the stock of its subsidiaries. Edison International may, in the future, engage in other businesses. At year-end 1998, Southern California Edison Company had 13,177 full-time employees. Edison International had 20 full-time employees, Edison Mission Energy had 1,180 full-time employees, Edison Capital had 85 full-time employees, and Edison Enterprises had 3,888 full-time employees. The information above concerning Edison International and its subsidiaries is only a summary and does not purport to be comprehensive. For additional information concerning Edison International and its subsidiaries, you should refer to the information described in "Where You Can Find More Information." The principal executive offices of Edison International are located at 2244 Walnut Grove Avenue, Rosemead, California 91770, and its telephone number is (626) 302-2222. THE TRUSTS Edison International created three Delaware business trusts pursuant to three trust agreements. The trusts are named EIX Trust I, EIX Trust II and EIX Trust III. Edison International will enter into an amended and restated trust agreement (a "Trust Agreement") for each trust, which will state the terms and conditions for each trust to issue and sell its preferred securities and common securities. A form of Trust Agreement is filed as an exhibit to the registration statement of which this prospectus forms a part. Each trust will exist solely to: . issue and sell its preferred securities (representing undivided beneficial interests in the assets of the trust) to the public; . issue and sell its common securities (representing undivided beneficial interests in the assets of the trust) to Edison International; . use the proceeds from the sale of its preferred and common securities to purchase a series of Edison International's subordinated debt securities; . distribute the cash payments it receives on the subordinated debt securities it owns to the holders of the preferred and common securities; and . engage in other activities that are necessary or incidental to these purposes. Edison International will purchase all of the common securities of each trust. The common securities will represent an aggregate liquidation amount equal to at least 3% of each trust's total capitalization. The preferred securities will represent the remaining 97% of the trust's total capitalization. The common securities will have terms substantially identical to, and will rank equal in priority of payment with, the preferred securities. However, if Edison International defaults on the related subordinated debt securities, then cash distributions and liquidation, redemption and other amounts payable on the common securities will be subordinate in priority of payment to such amounts payable on the preferred securities. 6 The preferred securities will be guaranteed by Edison International as described later in this prospectus. Edison International has appointed five trustees to conduct each trust's business and affairs: . The Chase Manhattan Bank ("property trustee"); . Chase Manhattan Bank Delaware ("Delaware trustee"); and . Three Edison International officers ("regular trustees"). Except under certain limited circumstances, only Edison International can remove or replace the trustees. In addition, Edison International can increase or decrease the number of trustees. Edison International will pay all fees and expenses related to each trust and each offering of the related preferred securities and will pay all ongoing costs and expenses of each trust, except the respective trust's obligations under the related preferred and common securities. The trusts will not have separate financial statements. The statements would not be material to holders of the preferred securities because no trust will have any independent operations. Each trust exists solely for the reasons summarized above. The principal offices of each trust will be located at 2244 Walnut Grove Avenue, Rosemead, California 91770, and the telephone number of each trust will be (626) 302-1930. USE OF PROCEEDS Unless stated otherwise in the applicable prospectus supplement, the net proceeds from the sale of the offered securities will be: . used by Edison International and/or its subsidiaries for general corporate purposes, including investing in nonutility business activities and reducing short-term debt incurred to provide interim financing for such purposes; and . used by the respective trusts to purchase subordinated debt securities of Edison International. RATIO OF EDISON INTERNATIONAL EARNINGS TO FIXED CHARGES AND PREFERRED STOCK DIVIDENDS The following table sets forth the ratio of Edison International earnings to combined fixed charges and preferred stock dividends for Edison International for each of the five years in the five-year period ended December 31, 1998:
Year Ended December 31, ------------------------ 1994 1995 1996 1997 1998 ---- ---- ---- ---- ---- Ratio of Earnings to Combined Fixed Charges and Preferred Stock Dividends........................... 2.48 2.55 2.40 2.39 2.31 Adjusted Ratio of Earnings to Combined Fixed Charges and Preferred Stock Dividends (1)................... NA NA NA 2.40 2.60
(1) The following effects of rate reduction notes are excluded from the adjusted ratios for 1997 and 1998:
1997 1998 ---------- ------------ Income before interest expense...................... $8,142,000 $149,486,000 Interest expense.................................... 8,142,000 149,486,000
SCE Funding LLC, a special purpose entity, of which Southern California Edison Company is the sole member, issued approximately $2.5 billion of these notes in December 1997. For further details you should refer to the information described in "Where You Can Find More Information" in the Prospectus, particularly page 46 of Edison International's 1998 Annual Report to Shareholders. 7 DESCRIPTION OF SECURITIES The following is a general description of the terms and provisions of the securities we may offer and sell by this prospectus. These summaries are not meant to be a complete description of each security. This prospectus and any accompanying prospectus supplement will contain the material terms and conditions for each security. The prospectus supplement may add, update or change the terms and conditions of the securities as described in this prospectus. For more information about the securities offered by us, please refer to: . the indenture between Edison International and Harris Trust and Savings Bank, as trustee, relating to the issuance of each series of senior debt securities by Edison International; . the indenture ("subordinated indenture") between Edison International and The Chase Manhattan Bank, as trustee, relating to the issuance of each series of subordinated debt securities by Edison International; . the Trust Agreement of each trust; and . the guarantee agreement between Edison International and The Chase Manhattan Bank, as trustee, relating to Edison International's guarantee of the preferred securities issued by each trust. Forms of these documents are filed as exhibits to the registration statement. The indentures listed above are sometimes collectively referred to as the "indentures" and individually referred to as an "indenture." The trustee under each indenture is referred to as the "indenture trustee." The indentures are subject to and governed by the Trust Indenture Act of 1939, and may be supplemented or amended from time to time following their execution. DESCRIPTION OF DEBT SECURITIES The following description discusses the general terms and provisions of the debt securities that Edison International may offer by this prospectus. The debt securities may be issued as senior debt securities or subordinated debt securities. Any subordinated debt securities issued by Edison International will be purchased by a trust and correspond to the series of preferred securities issued by the trust. The indebtedness represented by the senior debt securities will rank equally with all other unsecured and unsubordinated debt of Edison International. The indebtedness represented by the subordinated debt securities will rank junior and be subordinate in right of payment to the prior payment in full of the senior debt of Edison International, to the extent and in the manner set forth in the prospectus supplement for the securities. See "--Subordination" below. Each indenture gives us broad authority to set the particular terms of each series of debt securities, including the right to modify certain of the terms contained in the indenture. The particular terms of a series of debt securities and the extent, if any, to which the particular terms of the issue modify the terms of the indenture will be described in the prospectus supplement relating to the debt securities. Each indenture contains the full legal text of the matters described in this section. Because this section is a summary, it does not describe every aspect of the debt securities or the applicable indenture. This summary is subject to and qualified in its entirety by reference to all the provisions of the applicable indenture, including definitions of terms used in the indenture. We also include references in parentheses to certain sections of the indentures. Whenever we refer to particular sections or defined terms of the indentures in this prospectus or in a prospectus supplement, these sections or defined terms are incorporated by reference herein or in the prospectus supplement. This summary also is subject to and qualified by reference to the description of the particular terms of the debt securities in the applicable prospectus supplement. 8 General We may issue an unlimited amount of debt securities under each indenture in one or more series. We need not issue all debt securities of one series at the same time and, unless otherwise provided, we may reopen a series, without the consent of the holders of the debt securities of that series, for issuances of additional debt securities of that series. The debt securities will be unsecured obligations. Prior to the issuance of each series of debt securities, the terms of the particular securities will be specified in a supplemental indenture (including any pricing supplement) and a board resolution of Edison International or in one or more officer's certificates of Edison International pursuant to a supplemental indenture or a board resolution. We refer you to the applicable prospectus supplement for a description of the following terms of the series of debt securities: (a) the title of the debt securities; (b) any limit upon the principal amount of the debt securities; (c) the date or dates on which principal will be payable or how to determine the dates; (d) the rate or rates or method of determination of interest; the date from which interest will accrue; the dates on which interest will be payable, which we refer to as the "interest payment dates;" and any record dates for the interest payable on the interest payment dates; (e) any obligation or option of Edison International to redeem, purchase or repay debt securities, or any option of the registered holder to require Edison International to redeem or repurchase debt securities, and the terms and conditions upon which the debt securities will be redeemed, purchased or repaid; (f) the denominations in which the debt securities will be issuable (if other than denominations of $1,000 and any integral multiple thereof); (g) any provision relating to deferral of interest payments; (h) whether the debt securities are to be issued in whole or in part in the form of one or more global debt securities and, if so, the identity of the depositary for the global debt securities; and (i) any other terms of the debt securities. (See Section 301.) Payment of Debt Securities--Interest Unless indicated differently in a prospectus supplement, we will pay interest on the debt security on each interest payment date to the person in whose name the debt security is registered as of the close of business on the regular record date relating to the interest payment date. However, if we default in paying interest on a debt security, we will pay defaulted interest in either of the two following ways: (a) We will first propose to the indenture trustee a payment date for the defaulted interest. Next, the indenture trustee will choose a special record date for determining which registered holders are entitled to the payment. The special record date will be between 10 and 15 days before the payment date we propose. Finally, we will pay the defaulted interest on the payment date to the registered holder of the debt security as of the close of business on the special record date. 9 (b) Alternatively, we can propose to the indenture trustee any other lawful manner of payment that is consistent with the requirements of any securities exchange on which the debt securities are listed for trading. If the indenture trustee thinks the proposal is practicable, payment will be made as proposed. (See Section 307.) Payment of Debt Securities--Principal Unless we indicate differently in a prospectus supplement, we will pay principal of and any premium on the debt securities at stated maturity, upon redemption or otherwise, upon presentation of the debt securities at the office of the indenture trustee, as our paying agent. Any other paying agent initially designated for the debt securities of a particular series will be named in the applicable prospectus supplement. In our discretion, we may change the place of payment on the debt securities, and may remove any paying agent and may appoint one or more additional paying agents. (See Section 1002.) Form; Transfers; Exchanges The debt securities will be issued (a) only in fully registered form; (b) without interest coupons; and (c) unless otherwise specified in a prospectus supplement, in denominations that are integral multiples of $1,000. You may have your debt securities divided into debt securities of smaller denominations (of at least $1,000) or combined into debt securities of larger denominations, as long as the total principal amount is not changed. This is called an "exchange." You may exchange or transfer debt securities at the office of the indenture trustee. The indenture trustee acts as our agent for registering debt securities in the names of holders and transferring debt securities. We may appoint another agent or act as our own agent for this purpose. The entity performing the role of maintaining the list of registered holders is called the "security registrar." It will also perform transfers. In our discretion, we may change the place for registration of transfer of the debt securities and may remove and/or appoint one or more additional security registrars. (See Sections 305 and 1002.) Except as otherwise provided in a prospectus supplement, there will be no service charge for any transfer or exchange of the debt securities, but you may be required to pay a sum sufficient to cover any tax or other governmental charge payable in connection with the transfer or exchange. We may block the transfer or exchange of (a) debt securities during a period of 15 days prior to giving any notice of redemption or (b) any debt security selected for redemption in whole or in part, except the unredeemed portion of any debt security being redeemed in part. (See Section 305.) Redemption We will set forth any terms for the redemption of debt securities in a prospectus supplement. Unless we indicate differently in a prospectus supplement, and except with respect to debt securities redeemable at the option of the registered holder, debt securities will be redeemable upon notice by mail between 30 and 60 days prior to the redemption date. If less than all of the debt securities of any series or any tranche of a series are to be redeemed, the indenture trustee will select the debt securities to be redeemed. In the absence of any provision for selection, the indenture trustee will choose a method of random selection it deems fair and appropriate. (See Sections 1102, 1103 and 1104.) 10 Debt securities will cease to bear interest on the redemption date. We will pay the redemption price and any accrued interest once you surrender the debt security for redemption. (See Section 1105.) If only part of a debt security is redeemed, the indenture trustee will deliver to you a new debt security of the same series for the remaining portion without charge. (Section 1106.) We may make any redemption conditional upon the receipt by the paying agent, on or prior to the date fixed for redemption, of money sufficient to pay the redemption price. If the paying agent has not received the money by the date fixed for redemption, we will not be required to redeem the debt securities. (See Section 1104.) Events of Default An "event of default" occurs with respect to debt securities of any series if: (a) we do not pay any interest on any debt securities of the applicable series within 30 days of the due date (following any deferral allowed under the terms of the debt securities and elected by us); (b) we do not pay principal or premium on any debt securities of the applicable series on its due date; (c) we remain in breach of a covenant or warranty (excluding covenants and warranties not applicable to the affected series) of the indenture for 90 days after we receive a written notice of default stating we are in breach and requiring remedy of the breach; the notice must be sent by either the indenture trustee or registered holders of at least 25% of the principal amount of debt securities of the affected series; (d) we file for bankruptcy or other specified events in bankruptcy, insolvency, receivership or reorganization occur; or (e) any other event of default specified in the prospectus supplement occurs. (See Section 501.) No event of default with respect to a series of debt securities necessarily constitutes an event of default with respect to the debt securities of any other series issued under the indenture. Remedies Acceleration If an event of default occurs and is continuing with respect to any series of debt securities, then either the indenture trustee or the registered holders of not less than 25% in principal amount of the outstanding debt securities of that series may declare the principal amount of all of the debt securities of that series to be due and payable immediately. (See Section 502.) Rescission of Acceleration After the declaration of acceleration has been made and before the indenture trustee has obtained a judgment or decree for payment of the money due on any series of debt securities, the registered holders of not less than a majority in aggregate principal amount of the outstanding debt securities of that series may rescind and annul the declaration and its consequences, if (a) we pay or deposit with the indenture trustee a sum sufficient to pay (1) all overdue interest; (2) the principal of and any premium which have become due other than by the declaration of acceleration and overdue interest on these amounts; 11 (3) interest on overdue interest to the extent lawful; (4) all amounts due to the indenture trustee under the indenture; and (b) all events of default with respect to the affected series, other than the nonpayment of the principal which has become due solely by the declaration of acceleration, have been cured or waived as provided in the indenture. (See Section 502.) For more information as to waiver of defaults, see "Waiver of Default and of Compliance" below. Control by Registered Holders; Limitations Subject to the indenture, if an event of default with respect to the debt securities of any series occurs and is continuing, the registered holders of a majority in principal amount of the outstanding debt securities of that series will have the right to (a) direct the time, method and place of conducting any proceeding for any remedy available to the indenture trustee, or (b) exercise any trust or power conferred on the indenture trustee with respect to the debt securities of the series. If an event of default is continuing with respect to all the series of debt securities, the registered holders of a majority in aggregate principal amount of the outstanding debt securities of all the series, considered as one class, will have the right to make such direction, and not the registered holders of the debt securities of any one of the series. These rights of registered holders to make direction are subject to the following limitations: (a) the registered holders' directions will not conflict with any law or the indenture; and (b) the registered holders' directions may not involve the indenture trustee in personal liability where the indenture trustee believes indemnity is not adequate. The indenture trustee may also take any other action it deems proper which is consistent with the registered holders' direction. (See Sections 512 and 603.) In addition, the indenture provides that no registered holder of any debt security of any series will have any right to institute any proceeding, judicial or otherwise, with respect to the indenture for the appointment of a receiver or for any other remedy under the indenture unless (a) that registered holder has previously given the indenture trustee written notice of a continuing event of default; (b) the registered holders of not less than 25% in aggregate principal amount of the outstanding debt securities of all the series, considered as one class, or, in the case of an event of default of the character specified above in clause (a) or (b) under "Events of Default," that series, have made written request to the indenture trustee to institute proceedings in respect of that event of default and have offered the indenture trustee indemnity satisfactory to it against costs and liabilities incurred in complying with the request; and (c) for 60 days after receipt of the notice, the indenture trustee has failed to institute a proceeding and no direction inconsistent with the request has been given to the indenture trustee during the 60-day period by the registered holders of a majority in aggregate principal amount of outstanding debt securities of all the series, considered as one class, or, in the case of an event of default of the character specified above in clause (a) or (b) under "Events of Default," that series. 12 Furthermore, no registered holder will be entitled to institute any action if and to the extent that the action would disturb or prejudice the rights of other registered holders. (See Sections 507 and 603.) However, each registered holder has an absolute and unconditional right to receive payment when due and to bring a suit to enforce that right. (See Sections 507 and 508.) Notice of Default The indenture trustee is required to give the registered holders of the debt securities notice of any default under the indenture to the extent required by the Trust Indenture Act, unless the default has been cured or waived; except that in the case of an event of default of the character specified above in clause (c) under "Events of Default," no notice shall be given to the registered holders until at least 30 days after the occurrence thereof. (See Section 602.) The Trust Indenture Act currently permits the indenture trustee to withhold notices of default (except for certain payment defaults) if the indenture trustee in good faith determines the withholding of the notice to be in the interests of the registered holders. We will furnish the indenture trustee with an annual statement as to our compliance with the conditions and covenants in the indenture. (See Section 1005.) Waiver of Default and of Compliance The registered holders of a majority in aggregate principal amount of the outstanding debt securities of all affected series (voting as one class) may waive, on behalf of the registered holders of all debt securities of all such series, any past default under the indenture, except a default in the payment of principal, premium or interest, or with respect to compliance with certain provisions of the indenture that cannot be amended without the consent of the registered holder of each outstanding debt security. (See Section 513.) Compliance with some of the covenants in the indenture or otherwise provided with respect to debt securities may be waived by the registered holders of a majority in aggregate principal amount of the affected debt securities, considered as one class. (See Section 1006.) Consolidation, Merger and Conveyance of Assets as an Entirety; No Financial Covenants Subject to the provisions described in the next paragraph, Edison International will preserve its corporate existence. (See Section 1004.) Edison International has agreed not to consolidate with or merge into any other entity and not to convey, transfer or lease its properties and assets substantially as an entirety to any entity, unless: (a) the entity formed by the consolidation or into which Edison International is merged, or the entity which acquires or which leases the property and assets of Edison International substantially as an entirety, is an entity organized and existing under the laws of the United States of America or any State of the United States or the District of Columbia, and expressly assumes, by supplemental indenture, the due and punctual payment of the principal, premium and interest on all the outstanding debt securities and the performance of all of the covenants of Edison International under the indenture, and (b) immediately after giving effect to the transactions, no event of default, and no event which after notice or lapse of time or both would become an event of default, will have occurred and be continuing. (See Section 801.) The indenture contains no financial or other similar restrictive covenants. Any such covenants with respect to any particular series of debt securities will be set forth in the applicable prospectus supplement. 13 Modification of Indenture Without Registered Holder Consent. Without the consent of any registered holders of debt securities, we and the applicable indenture trustee may enter into one or more supplemental indentures for any of the following purposes: (a) to evidence the succession of another entity to Edison International; or (b) to add one or more covenants of Edison International or other provisions for the benefit of the registered holders of all or any series or tranche of debt securities, or to surrender any right or power conferred upon Edison International; or (c) to add any additional events of default for all or any series of debt securities; or (d) to change or eliminate any provision of the indenture or to add any new provision to the indenture that does not adversely affect the interests of the registered holders; or (e) to provide security for the debt securities of any series; or (f) to establish the form or terms of debt securities of any series or tranche or any debt securities guarantees as permitted by the indenture; or (g) to provide for the issuance of bearer securities; or (h) to evidence and provide for the acceptance of appointment of a separate or successor indenture trustee; or (i) to provide for the procedures required to permit the utilization of a noncertificated system of registration for any series or tranche of debt securities; or (j) to change any place or places where (1) we may pay principal, premium and interest, (2) debt securities may be surrendered for transfer or exchange, or (3) notices and demands to or upon Edison International may be served; or (k) to cure any ambiguity, defect or inconsistency or to make any other changes that do not adversely affect the interests of the registered holders in any material respect. (See Section 901.) If the Trust Indenture Act is amended after the date of the indenture so as to require changes to the indenture or so as to permit changes to, or the elimination of, provisions which, at the date of the indenture or at any time thereafter, were required by the Trust Indenture Act to be contained in the indenture, the indenture will be deemed to have been amended so as to conform to the amendment or to effect the changes or elimination, and Edison International and the applicable indenture trustee may, without the consent of any registered holders, enter into one or more supplemental indentures to effect or evidence the amendment. With Registered Holder Consent. We and the indenture trustee may, with some exceptions, amend or modify any indenture with the consent of the registered holders of at least a majority in aggregate principal amount of the debt securities of all series affected by the amendment or modification (voting as one class). However, no amendment or modification may, without the consent of the registered holder of each outstanding debt security affected thereby, (a) change the stated maturity of the principal or interest on any debt security (other than pursuant to the terms of the debt security), or reduce the principal amount, interest or premium payable or change the currency in which any debt security is payable, or impair the right to bring suit to enforce any payment; 14 (b) reduce the percentages of registered holders whose consent is required for any supplemental indenture or waiver or reduce the requirements for quorum and voting under the indenture; or (c) modify certain of the provisions in the indenture relating to supplemental indentures and waivers of certain covenants and past defaults. A supplemental indenture which changes or eliminates any provision of the indenture expressly included solely for the benefit of registered holders of debt securities of one or more particular series or tranches will be deemed not to affect the rights under the indenture of the registered holders of debt securities of any other series or tranche. (See Section 902.) Miscellaneous The indenture provides that some debt securities, including those for which payment or redemption money has been deposited or set aside in trust, will not be deemed to be "outstanding" in determining whether the registered holders of the requisite principal amount of the outstanding debt securities have given or taken any demand, direction, consent or other action under the indenture as of any date, or are present at a meeting of registered holders for quorum purposes. (See Section 101.) We will be entitled to set any day as a record date for the purpose of determining the registered holders of outstanding debt securities of any series entitled to give or take any demand, direction, consent or other action under the indenture, in the manner and subject to the limitations provided in the indenture. In some circumstances, the indenture trustee also will be entitled to set a record date for action by registered holders. If a record date is set for any action to be taken by registered holders of particular debt securities, the action may be taken only by persons who are registered holders of the respective debt securities on the record date. (See Section 104.) Defeasance and Covenant Defeasance The indentures provide, unless the terms of the particular series of debt securities provide otherwise, that we may, upon satisfying several conditions, cause ourselves to be: (a) discharged from our obligations, with some exceptions, with respect to any series of debt securities, which we refer to as "defeasance"; and (b) released from our obligations under specified covenants with respect to any series of debt securities, which we refer to as "covenant defeasance." One condition we must satisfy is the irrevocable deposit with the indenture trustee, in trust, of money and/or government obligations which, through the scheduled payment of principal and interest on those obligations, would provide sufficient moneys to pay the principal of and any premium and interest on those debt securities on the maturity dates of the payments or upon redemption. The indentures permit defeasance with respect to any series of debt securities even if a prior covenant defeasance has occurred with respect to the debt securities of that series. Following a defeasance, payment of the debt securities defeased may not be accelerated because of an event of default. Following a covenant defeasance, payment of the debt securities may not be accelerated by reference to the specified covenants affected by the covenant defeasance. However, if an acceleration were to occur, the realizable value at the acceleration date of the money and government obligations in the defeasance trust could be less than the principal and interest then due on the respective debt securities, since the required deposit in the defeasance trust would be based upon scheduled cash flows rather than market value, which would vary depending upon interest rates and other factors. 15 Under current United States federal income tax law, the defeasance contemplated in the preceding paragraphs would be treated as an exchange of the relevant debt securities in which holders of the debt securities might recognize gain or loss. In addition, the amount, timing and character of amounts that holders would be required after the defeasance to include in income might be different from that which would be includible in the absence of the defeasance. Prospective investors are urged to consult their own tax advisors as to the specific consequences of a defeasance, including the applicability and effect of tax laws other than United States federal income tax laws. Under current United States federal income tax laws, unless accompanied by other changes in the terms of the debt securities, covenant defeasance generally should not be treated as a taxable exchange. Resignation and Removal of the Indenture Trustee; Deemed Resignation The indenture trustee may resign at any time by giving written notice to us. The indenture trustee may also be removed by act of the registered holders of a majority in principal amount of the then outstanding debt securities of any series. No resignation or removal of the indenture trustee and no appointment of a successor indenture trustee will become effective until the acceptance of appointment by a successor indenture trustee in accordance with the requirements of the indenture. Under some circumstances, we may appoint a successor indenture trustee and, if the successor accepts, the indenture trustee will be deemed to have resigned. (Section 610). Subordination Unless we indicate differently in a prospectus supplement, any subordinated debt securities will be subordinated in the following manner. If Edison International's assets are distributed upon our dissolution, winding up, liquidation or reorganization, the payment of the principal of, premium, if any, and interest on any subordinated debt securities will be subordinated, to the extent provided in the subordinated indenture and the applicable supplemental indenture, to the prior payment in full of all senior indebtedness, including senior debt securities. However, Edison International's obligation to pay principal, and premium, if any, or interest on the subordinated debt securities will not otherwise be affected. No payment on account of principal, or premium, if any, sinking fund or interest may be made on the subordinated debt securities at any time when there is a default in the payment of principal, premium, if any, sinking fund or interest on senior indebtedness. If, while Edison International is in default on senior indebtedness, any payment is received by the indenture trustee under the subordinated debt security indenture or the holders of any of the subordinated debt securities before it has paid all senior indebtedness in full, the payment or distribution must be paid over to the holders of the unpaid senior indebtedness or applied to the repayment of the unpaid senior indebtedness. Subject to paying the senior indebtedness in full, the holders of the subordinated debt securities will be subrogated to the rights of the holders of the senior indebtedness to the extent that payments are made to the holders of senior indebtedness out of the distributive share of the subordinated debt securities. Due to the subordination, if Edison International's assets are distributed upon insolvency, some or all of its general creditors may recover more, ratably, than holders of subordinated debt securities. The subordinated indenture or applicable supplemental indenture may state that its subordination 16 provisions will not apply to money and securities held in trust under the satisfaction and discharge, and the legal defeasance provisions of the subordinated indenture. If this prospectus is being delivered in connection with the offering of a series of subordinated debt securities, the accompanying prospectus supplement or the information incorporated by reference in it will set forth the approximate amount of senior indebtedness outstanding as of a recent date. Conversion Rights The terms and conditions of any debt securities being offered that are convertible into common stock of Edison International will be set forth in a prospectus supplement. These terms will include the conversion price, the conversion period, provisions as to whether conversion will be at the option of the holder or us, the events requiring an adjustment of the conversion price and provisions affecting conversion in the event that the debt securities are redeemed. Governing Law The subordinated indenture and the related debt securities will be governed by and construed in accordance with the laws of the State of California, except that the rights, duties, immunities and indemnities of the indenture trustee will be governed by the laws of the State of New York. The senior indenture and the related debt securities will be governed by and construed in accordance with the laws of the State of California. DESCRIPTION OF EDISON INTERNATIONAL'S COMMON STOCK AND PREFERRED STOCK The following description of Edison International's common stock and preferred stock is only a summary and is qualified in its entirety by reference to the articles of incorporation and bylaws of Edison International. Therefore, you should read carefully the more detailed provisions of Edison International's Restated Articles of Incorporation, Edison International's Amended Bylaws, and Edison International's Rights Agreement, dated November 21, 1996, between Edison International and Harris Trust Company of California, as rights agent, copies of which are incorporated by reference as exhibits to the registration statement of which this prospectus is a part. General The authorized capital stock of Edison International consists of (1) 800,000,000 shares of Edison International common stock, without par value, and (2) 50,000,000 shares of preferred stock, without par value. As of March 31, 1999, there were issued and outstanding 347,207,697 shares of Edison International common stock and no shares of Edison International preferred stock. No other classes of capital stock are authorized under the Edison International articles of incorporation. The issued and outstanding shares of Edison International common stock are duly authorized, validly issued, fully paid, nonassessable and free of preemptive rights. Edison International Common Stock The holders of Edison International common stock are entitled to receive such dividends as the Edison International board of directors may from time to time declare, subject to any rights of holders of outstanding shares of Edison International preferred stock. Except as otherwise provided by law, each holder of Edison International common stock is entitled to one vote per share on each matter 17 submitted to a vote of a meeting of shareholders, subject to any class or series voting rights of holders of Edison International preferred stock. In the event of any liquidation, dissolution or winding up of Edison International, whether voluntary or involuntary, the holders of shares of Edison International common stock, subject to any rights of the holders of outstanding shares of Edison International preferred stock, are entitled to receive any remaining assets of Edison International after the discharge of its liabilities. Holders of Edison International common stock are not entitled to preemptive rights to subscribe for or purchase any part of any new or additional issue of stock or securities convertible into stock. Edison International common stock does not contain any redemption provisions or conversion rights and is not liable to assessment or further call. Each outstanding share of Edison International common stock is accompanied by a right to purchase one one-thousandth of a share of Series A Junior Participating Cumulative Preferred Stock, without par value, of Edison International at a price of $55.00 per right, subject to certain anti-dilution adjustments. The Edison International board of directors has reserved 3,000,000 shares of such Series A preferred stock for issuance upon exercise of the rights, as more fully discussed below under the heading "--Description of Preferred Share Purchase Rights." The registrar and transfer agent for the Edison International common stock is Southern California Edison Company. Preferred Stock The Edison International board of directors is authorized, pursuant to the Edison International articles of incorporation, to issue up to 50,000,000 shares of Edison International preferred stock in one or more series and to fix the number of shares of any series of preferred stock, to determine the designation of any such series, to increase or decrease the number of shares of any such series subsequent to the issue of shares of that series, and to determine or alter the rights, preferences, privileges and restrictions granted to or imposed upon any wholly unissued series of preferred stock. As of March 31, 1999, there were no shares of Edison International preferred stock outstanding. However, the Edison International board of directors has reserved 3,000,000 shares of Series A preferred stock for issuance in connection with rights issued under the Edison International rights agreement. Prior to the issuance of shares of each series of preferred stock, the board of directors is required to adopt resolutions and file a certificate of determination with the Secretary of State of the State of California (other than the Series A preferred stock, for which those actions have been taken previously). The certificate of determination will fix for each series the designation and number of shares and the rights, preferences, privileges and restrictions of the shares including, but not limited to, the following: (a) the title and stated value of the preferred stock; (b) voting rights, if any, of the preferred stock; (c) any rights and terms of redemption (including sinking fund provisions); (d) the dividend rate(s), period(s) and/or payment date(s) or method(s) of calculation applicable to the preferred stock; (e) whether dividends are cumulative or non-cumulative and, if cumulative, the date from which dividends on the preferred stock will accumulate; 18 (f) the relative ranking and preferences of the preferred stock as to dividend rights and rights upon the liquidation, dissolution or winding up of our affairs; (g) the terms and conditions, if applicable, upon which the preferred stock will be convertible into common stock, including the conversion price (or manner of calculation) and conversion period; (h) the provision for redemption, if applicable, of the preferred stock; (i) the provisions for a sinking fund, if any, for the preferred stock; (j) liquidation preferences; (k) any limitations on issuance of any class or series of preferred stock ranking senior to or on a parity with the class or series of preferred stock as to dividend rights and rights upon liquidation, dissolution or winding up of our affairs; and (l) any other specific terms, preferences, rights, limitations or restrictions of the preferred stock. All shares of preferred stock will, when issued, be fully paid and nonassessable and will not have any preemptive or similar rights. In addition to the terms listed above, we will set forth in a prospectus supplement the following terms relating to the class or series of preferred stock being offered: (a) the number of shares of the preferred stock offered, the liquidation preference per share and the offering price of the preferred stock; (b) the procedures for auction and remarketing, if any, for the preferred stock; (c) any listing of the preferred stock on any securities exchange; and (d) a discussion of any material and/or special United States federal income tax considerations applicable to the preferred stock. Rank Unless we specify otherwise in the applicable prospectus supplement, the preferred stock will rank, with respect to dividends and upon our liquidation, dissolution or winding up: (a) senior to all classes or series of our common stock and to all of our equity securities ranking junior to the preferred stock; (b) on a parity with all of our equity securities the terms of which specifically provide that the equity securities rank on a parity with the preferred stock; and (c) junior to all of our equity securities the terms of which specifically provide that the equity securities rank senior to the preferred stock. Description of Preferred Share Purchase Rights On November 21, 1996, the Edison International board of directors adopted a preferred share purchase rights plan providing that one preferred share purchase right will attach to each share of Edison International common stock. The description and terms of the rights are set forth in a rights agreement, dated as of November 21, 1996, by and between Edison International and Harris Trust Company of California, as rights agent. The purchase rights have an anti- takeover effect that is intended to discourage coercive or unfair takeover tactics and to encourage any potential acquirer to negotiate a fair price to all Edison International shareholders. The purchase rights may cause 19 substantial dilution to any party that may attempt to acquire Edison International on terms not approved by the Edison International board of directors. However, the purchase rights are structured in a way so as not to interfere with any negotiated merger or other business combination. The rights will expire on November 21, 2006. Until a right is exercised, the holder of the right will have no rights as a shareholder of Edison International beyond those rights afforded to existing shareholders, including the right to vote or to receive dividends. The rights are designed to assure that all of Edison International's shareholders receive fair and equal treatment in the event of any proposed takeover of Edison International and to guard against partial tender offers, open market accumulations and other abusive tactics that may be deployed to gain control of Edison International without a control premium paid to all shareholders. Any time prior to the first date that a person or group has become an "acquiring person" as defined in the rights agreement, the rights should not interfere with any merger or other business combination as long as it is approved by the Edison International board of directors. Anti-Takeover Provisions The Edison International articles of incorporation and bylaws contain provisions that may have the effect of discouraging persons from acquiring large blocks of Edison International stock or delaying or preventing a change in control of Edison International. The material provisions which may have such an effect are: (a) a provision permitting the Edison International board of directors to amend or repeal the Edison International bylaws, except that provisions of the bylaws specifying or changing a fixed number of directors or the maximum or minimum number or changing from a fixed to a variable board of directors or vice versa may only be adopted by approval of outstanding shares; (b) authorization for the Edison International board of directors to issue Edison International preferred stock in series and to fix rights and preferences of the series (including, among other things, whether, and to what extent, the shares of any series will have voting rights and the extent of the preferences of the shares of any series with respect to dividends and other matters); and (c) a provision requiring the approval of holders of at least 80% of the outstanding voting shares of Edison International for such acquisition or change of control unless either a majority of the disinterested directors of the Edison International board of directors approves such acquisition or change of control or the consideration received in connection with such acquisition or change of control equals at least the fair market value of the capital stock of Edison International. Some acquisitions of Edison International's outstanding voting shares would also require approval of the SEC under the Public Utility Holding Company Act of 1935 and of various federal, state and foreign regulatory authorities. DESCRIPTION OF PREFERRED SECURITIES General Each Trust Agreement authorizes the regular trustees to issue on behalf of each trust one series of preferred securities which will have the terms described in a prospectus supplement. The proceeds from the sale of a trust's preferred and common securities will be used by the trust to purchase a series of subordinated debt securities issued by Edison International. The subordinated debt securities will be held in trust by the property trustee for the benefit of the holders of the preferred and common securities. 20 Under each preferred securities guarantee, Edison International will agree to make payments of distributions and payments on redemption or liquidation with respect to a trust's preferred securities, but only to the extent the trust has funds available to make those payments and has not made the payments. See "Description of Preferred Securities Guarantees." The assets of a trust available for distribution to the holders of its preferred securities will be limited to payments from Edison International under the series of subordinated debt securities held by the trust. If Edison International fails to make a payment on the subordinated debt securities, the trust will not have sufficient funds to make related payments, including distributions, on its preferred securities. Each preferred securities guarantee, when taken together with Edison International's obligations under the related series of subordinated debt securities, the subordinated indenture, the related Trust Agreement and the related expense agreement (as described below), will provide a full and unconditional guarantee by Edison International of amounts due on the preferred securities issued by a trust. Each Trust Agreement will be qualified as an indenture under the Trust Indenture Act. Each property trustee will act as indenture trustee for the preferred securities to be issued by the applicable trust, in order to comply with the provisions of the Trust Indenture Act. Each series of preferred securities will have the terms, including those regarding distributions, redemption, voting, liquidation rights and the other preferred, deferred or other special rights or other restrictions, as described in the relevant Trust Agreement or made part of the Trust Agreement by the Trust Indenture Act or the Delaware Business Trust Act. The terms of the preferred securities will mirror the terms of the subordinated debt securities held by the trust. The prospectus supplement relating to the preferred securities of a trust will describe the specific terms of the preferred securities, including: (a) the name of the preferred securities; (b) the dollar amount and number of securities issued; (c) any provision relating to deferral of distribution payments; (d) the annual distribution rate(s), or method of determining the rate(s), the payment date(s) and the record dates used to determine the holders who are to receive distributions; (e) the date from which distributions will be cumulative; (f) the optional redemption provisions, if any, including the prices, time periods and other terms and conditions for which the preferred securities will be purchased or redeemed, in whole or in part; (g) the terms and conditions, if any, upon which the applicable series of subordinated debt securities may be distributed to holders of the preferred securities; (h) the voting rights, if any, of holders of the preferred securities; (i) any securities exchange on which the preferred securities will be listed; (j) whether the preferred securities are to be issued in book-entry form and represented by one or more global certificates and, if so, the depository for the global certificates and the specific terms of the depositary arrangements; and (k) any other relevant rights, preferences, privileges, limitations or restrictions of the preferred securities. 21 Each prospectus supplement will describe various United States federal income tax considerations applicable to the purchase, holding and disposition of the series of preferred securities covered by the prospectus supplement. Liquidation Distribution Upon Dissolution Unless otherwise specified in an applicable prospectus supplement, each Trust Agreement states that the related trust shall be dissolved: (a) on the expiration of the term of the trust; (b) upon the bankruptcy, dissolution or liquidation of Edison International; (c) upon direction by Edison International to the property trustee to dissolve the trust and distribute the related subordinated debt securities directly to the holders of the preferred and common securities of the trust; (d) upon the redemption of all of the common and preferred securities of the trust in connection with the redemption of all of the related subordinated debt securities; or (e) upon entry of a court order for the dissolution of the trust. Unless otherwise specified in an applicable prospectus supplement, in the event of a dissolution as described in (a), (b), (c) or (e) above, after the trust satisfies all liabilities to its creditors as provided by applicable law, each holder of the preferred or common securities will be entitled to receive: (a) the related subordinated debt securities in an aggregate principal amount equal to the aggregate liquidation amount of the preferred or common securities held by the holder; or (b) if such a distribution of related subordinated debt securities is determined by the property trustee not to be practical, cash equal to the aggregate liquidation amount of the preferred or common securities held by the holder, plus accumulated and unpaid distributions to the date of payment. If the trust cannot pay the full amount due on its preferred and common securities because insufficient assets are available for payment, then the amounts payable by the trust on its preferred and common securities will be paid on a pro rata basis. However, if an event of default under the related subordinated indenture has occurred and is continuing, the total amounts due on the preferred securities will be paid before any distribution on the common securities. Events of Default An "event of default" under the Trust Agreement (a "Trust Agreement event of default") occurs if: (a) an event of default under the subordinated indenture relating to a series of subordinated debt securities occurs or (b) any other event of default specified in the prospectus supplement occurs. See "Description of Debt Securities--Events of Default." Edison International and the regular trustees of a trust must file annually with the property trustee for the trust a certificate stating whether or not they are in compliance with all the applicable conditions and covenants under the related Trust Agreement. If an event of default occurs under the subordinated indenture, and the indenture trustee and the holders of not less than 25% in principal amount of the related subordinated debt securities outstanding fail to declare the principal of all of such subordinated debt securities to be immediately due and payable, the holders of at least 25% in aggregate liquidation amount of the outstanding 22 preferred securities of the applicable trust will have the right to declare such principal immediately due and payable, by providing notice to Edison International and the indenture trustee. If Edison International fails to pay principal, premium, if any, or interest on a series of subordinated debt securities when payable, then a holder of the related preferred securities may directly sue Edison International to collect its pro rata share of payments owed. Consolidation, Merger or Amalgamation of the Trusts A trust may not consolidate, amalgamate, merge with or into, or be replaced by or convey, transfer or lease its properties and assets substantially as an entirety to any corporation or other body ("Merger Event"), except as described below or as described in "Liquidation Distribution Upon Dissolution." A trust may, with the consent of the holders of at least a majority in aggregate liquidation amount of its outstanding preferred securities, consolidate, amalgamate, merge with or into, or be replaced by or convey, transfer or lease its properties and assets substantially as an entirety to another trust, if: (a) the successor entity either (1) expressly assumes all of the obligations of the trust relating to its preferred securities; or (2) substitutes for the trust's preferred securities other securities having substantially the same terms as the preferred securities ("successor securities"), so long as the successor securities rank the same as the preferred securities for distributions and payments upon liquidation, redemption and otherwise; (b) Edison International expressly appoints a trustee of the successor entity who has the same powers and duties as the property trustee of the trust as the holder of the particular series of subordinated debt securities; (c) the preferred securities are listed or traded, or any successor securities will be listed upon notice of issuance, on the same national securities exchange or other organization on which the preferred securities are then listed or traded; (d) the Merger Event does not cause the preferred securities or any successor securities to be downgraded by any national rating agency; (e) the Merger Event does not adversely affect the rights, preferences and privileges of the holders of the preferred securities or any successor securities in any material way; (f) the successor entity has a purpose substantially identical to that of the trust; (g) prior to the Merger Event, Edison International has received an opinion of counsel from a nationally recognized law firm stating that: (1) the Merger Event does not adversely affect the rights, preferences and privileges of the holders of the trust's preferred securities or any successor securities in any material way; and (2) following the Merger Event, neither the trust nor the successor entity will be required to register as an investment company under the Investment Company Act of 1940, as amended; and (h) Edison International owns all of the common securities of the successor entity and guarantees the obligations of the successor entity under the successor securities at least to the extent provided under the applicable preferred securities guarantee. 23 In addition, unless all of the holders of the preferred securities approve otherwise, a trust may not consolidate, amalgamate, merge with or into, or be replaced by or convey, transfer or lease its properties and assets substantially as an entirety to any other entity or permit any other entity to consolidate, amalgamate, merge with or into, or replace it, if the transaction would cause the trust or the successor entity to be classified other than as a grantor trust for United States federal income tax purposes. Voting Rights; Amendment of Trust Agreement Unless otherwise specified in an applicable prospectus supplement, the holders of preferred securities will have no voting rights except as discussed below and under "--Consolidation, Merger or Amalgamation of the Trusts" and "Description of the Preferred Securities Guarantees--Amendments and Assignment," and as otherwise required by law and the Trust Agreement for the trust. If any proposed amendment to the Trust Agreement of a trust provides for, or the regular trustees of the trust otherwise propose to effect: (a) any action that would adversely affect the powers, preferences or special rights of the trust's preferred securities in any material respect, whether by way of amendment to the Trust Agreement or otherwise; or (b) the dissolution, winding-up or termination of the trust other than pursuant to the terms of its Trust Agreement, then the holders of the trust's preferred securities as a class will be entitled to vote on the amendment or proposal. In that case, the amendment or proposal will be effective only if approved by the holders of at least a majority in aggregate liquidation amount of the preferred securities. The Trust Agreement of a trust may be amended from time to time by Edison International and the property trustee and the regular trustees of the trust, without the consent of the holders of preferred securities of the trust, to: (a) cure any ambiguity, correct or supplement any provision which may be inconsistent with any other provision, or make provisions not inconsistent with any other provisions with respect to matters or questions arising under the Trust Agreement, in each case to the extent that the amendment does not adversely affect the interests of any holder of preferred securities of the trust in any material respect; or (b) modify, eliminate or add to any provisions to the extent necessary to ensure that the trust will not be classified as other than a grantor trust for United States federal income tax purposes or to ensure that the trust will not be required to register as an "investment company" under the Investment Company Act. Except a provided in the next paragraph, other amendments to the Trust Agreement of a trust may be made by Edison International and the trustees of the trust upon: (a) approval of the holders of a majority in aggregate liquidation amount of the outstanding preferred securities of the trust; and (b) receipt by the trustees of an opinion of counsel to the effect that such amendment will not affect the trust's status as a grantor trust for United States federal income tax purposes or the trust's exemption from the Investment Company Act. 24 Notwithstanding the foregoing, without the consent of each affected holder of common or preferred securities of a trust, the Trust Agreement of the trust may not be amended to: (a) change the amount or timing of any distribution on the common or preferred securities of the trust or otherwise adversely affect the amount of any distribution required to be made in respect of such securities as of a specified date; or (b) restrict the right of a holder of any such securities to institute suit for the enforcement of any such payment on or after such date. In addition, no amendment may be made to a Trust Agreement if the amendment would: (a) cause the related trust to be characterized as other than a grantor trust for United States federal income tax purposes; (b) cause the related trust to be deemed to be an "investment company" which is required to be registered under the Investment Company Act; or (c) impose any additional obligation on Edison International, the property trustee or the Delaware trustee without its consent. Without obtaining the prior approval of the holders of a majority in aggregate liquidation amount of the preferred securities of a trust, the trustees of the trust may not: (a) direct the time, method and place of conducting any proceeding for any remedy available to the indenture trustee for the subordinated debt securities held by the trust or executing any trust or power conferred on the property trustee with respect to such securities; (b) waive any default that is waivable under the subordinated indenture; (c) cancel an acceleration of the principal of the subordinated debt securities; or (d) consent to any amendment, modification or termination of the subordinated indenture or the subordinated debt securities where such consent is required. However, if a consent under the subordinated indenture requires the consent of each affected holder of subordinated debt securities, then the property trustee must obtain the prior consent of each holder of preferred securities. In addition, before taking any of the foregoing actions, the property trustee must obtain an opinion of counsel stating that the action will not cause the trust to be classified as other than a grantor trust for United States federal income tax purposes. The property trustee of a trust will notify all preferred securities holders of the trust of any notice of default received from the indenture trustee with respect to the subordinated debt securities held by the trust. Removal and Replacement of Trustees The holder of a trust's common securities may remove or replace any of the regular trustees and, unless an event of default has occurred and is continuing under the subordinated indenture, the property and Delaware trustees of the trust. If such an event of default has occurred and is continuing, only the holders of a trust's preferred securities may remove or replace the property and Delaware trustees. The resignation or removal of any trustee will be effective only on the acceptance of appointment by the successor trustee in accordance with the provisions of the Trust Agreement for the trust. 25 Information Concerning the Property Trustees For matters relating to compliance with the Trust Indenture Act, the property trustee of each trust will have all of the duties and responsibilities of an indenture trustee under the Trust Indenture Act. Each property trustee, other than during the occurrence and continuance of a default under the applicable Trust Agreement, undertakes to perform only the duties as are specifically set forth in the applicable Trust Agreement and, after a default, must use the same degree of care and skill as a prudent person would exercise or use in the conduct of his or her own affairs. Subject to this provision, a property trustee is under no obligation to exercise any of the powers given it by the applicable Trust Agreement at the request of any holder of preferred securities unless it is offered reasonable security or indemnity against the costs, expenses and liabilities that it might incur. If the property trustee is required to decide between alternative courses of action, construe ambiguous provisions in the applicable Trust Agreement or is unsure of the application of any provision of the applicable Trust Agreement, and the matter is not one on which the holders of preferred securities are entitled to vote, then the property trustee will take such action as it deems advisable and in the best interests of the holders of the preferred and common securities. In this event, the property trustee will have no liability except for its own bad faith, negligence or willful misconduct. The property trustee for each of the trusts is the same entity and will also serve as the indenture trustee under each of the indentures and the guarantee trustee under each of the guarantee agreements. Edison International and certain of its subsidiaries maintain deposit accounts and banking relationships with the property trustee. Miscellaneous The trustees of each trust are authorized and directed to conduct the affairs of and to operate the trust in such a way that: (a) it will not be deemed to be an "investment company" required to be registered under the Investment Company Act; (b) it will be classified as a grantor trust for United States federal income tax purposes; and (c) the subordinated debt securities held by it will be treated as indebtedness of Edison International for United States federal income tax purposes. Edison International and the trustees of each trust are authorized to take any action (so long as it is consistent with applicable law or the applicable certificate of trust or Trust Agreement) that Edison International and the trustees of the trust determine to be necessary or desirable for such purposes. Registered holders of preferred securities have no preemptive or similar rights. A trust may not borrow money, issue debt, execute mortgages or pledge any of its assets. Governing Law Each Trust Agreement and the related preferred securities will be governed by and construed in accordance with the laws of the State of Delaware. 26 DESCRIPTION OF PREFERRED SECURITIES GUARANTEES General Edison International will execute a guarantee agreement (a "preferred securities guarantee"), for the benefit of the holders of preferred securities, at the time that a trust issues those preferred securities. Each preferred securities guarantee will be qualified as an indenture under the Trust Indenture Act. The Chase Manhattan Bank will act as indenture trustee ("guarantee trustee") under each preferred securities guarantee for the purposes of compliance with the Trust Indenture Act. The guarantee trustee will hold each preferred securities guarantee for the benefit of the preferred securities holders of the applicable trust. Edison International will irrevocably agree, as described in each preferred securities guarantee, to pay in full, to the holders of the preferred securities issued by the applicable trust, the preferred securities guarantee payments (as defined below) (except to the extent previously paid), when and as due, regardless of any defense, right of set-off or counterclaim which the trust may have or assert. The following payments, to the extent not paid by a trust ("preferred securities guarantee payments"), will be covered by the applicable preferred securities guarantee: (a) any accumulated and unpaid distributions required to be paid on the applicable preferred securities, to the extent that the trust has funds available to make the payment; (b) the redemption price, to the extent that the trust has funds available to make the payment; and (c) upon a voluntary or involuntary dissolution, termination, winding-up or liquidation of the trust (other than in connection with a distribution of subordinated debt securities to holders of the preferred securities), the lesser of: (1) the aggregate of the liquidation amounts specified in the prospectus supplement for each preferred security plus all accumulated and unpaid distributions on the preferred security to the date of payment, to the extent the trust has funds available to make the payment; and (2) the amount of assets of the trust remaining available for distribution to holders of its preferred securities upon liquidation of the trust. Edison International's obligation to make a preferred securities guarantee payment may be satisfied by directly paying the required amounts to the holders of the preferred securities or by causing the trust to pay the amounts to the holders. Status of the Preferred Securities Guarantees Each preferred securities guarantee will constitute an unsecured obligation of Edison International and will rank: (a) subordinate and junior in right of payment to all of Edison International's other liabilities except those that rank equally or are subordinate by their terms; and (b) equal with any other preferred securities guarantee now or hereafter issued by Edison International on behalf of the holders of preferred securities issued by any other trust. Each preferred securities guarantee will constitute a guarantee of payment and not of collection (in other words, the holder of the guaranteed security may sue Edison International, or seek other remedies, to enforce its rights under the preferred securities guarantee without first suing any other person or entity). A preferred securities guarantee will not be discharged except by payment of the preferred securities guarantee payments in full to the extent not otherwise paid or upon distribution to the applicable preferred securities holders of the related subordinated debt securities pursuant to the applicable Trust Agreement. 27 Amendments and Assignment Except with respect to any changes which do not adversely affect the rights of holders of preferred securities in any material respect (in which case no consent of the holders will be required), a preferred securities guarantee may be amended only with the prior approval of the holders of at least a majority in aggregate liquidation amount of the preferred securities. A description of the way to obtain any approval appears under "Description of the Preferred Securities--Voting Rights; Amendment of Trust Agreements." All guarantees and agreements contained in a preferred securities guarantee will be binding on Edison International's successors, assigns, receivers, trustees and representatives and are for the benefit of the holders of the applicable preferred securities. Events of Default An event of default under a preferred securities guarantee occurs if Edison International fails to make any of its required payments or fails to perform any of its other obligations (and such failure continues for 30 days) under the preferred securities guarantee. The holders of at least a majority in aggregate liquidation amount of the preferred securities relating to each preferred securities guarantee will have the right to direct the time, method and place of conducting any proceeding for any remedy available to the guarantee trustee relating to the preferred securities guarantee or to direct the exercise of any trust or power given to the guarantee trustee under the preferred securities guarantee. Information Concerning Guarantee Trustees The guarantee trustee under a preferred securities guarantee, other than during the occurrence and continuance of a default under the preferred securities guarantee, will perform only the duties that are specifically described in the preferred securities guarantee. After such a default, the guarantee trustee will exercise the same degree of care and skill as a prudent person would exercise or use in the conduct of his or her own affairs. Subject to this provision, a guarantee trustee is under no obligation to exercise any of its powers as described in the applicable preferred securities guarantee at the request of any holder of covered preferred securities unless it is offered security and indemnity satisfactory to it against the costs, expenses and liabilities that it might incur. Termination of the Preferred Securities Guarantees Each preferred securities guarantee will terminate once the applicable preferred securities are paid in full or upon distribution of the related subordinated debt securities to the holders of the preferred securities in accordance with the applicable Trust Agreement. Each preferred securities guarantee will continue to be effective or will be reinstated if at any time any holder of preferred securities issued by the applicable trust must restore payment of any sums paid under the preferred securities or the preferred securities guarantee. Governing Law The preferred securities guarantees will be governed by and construed in accordance with the laws of the State of California, except that the rights, duties, immunities and indemnities of the guarantee trustee shall be governed by the laws of the State of New York. 28 DESCRIPTION OF EXPENSE AGREEMENTS Edison International will execute an expense agreement at the same time that a trust issues preferred securities. Under the expense agreement, Edison International will irrevocably and unconditionally guarantee to each creditor of the trust, the full amount of the trust's costs, expenses and liabilities, other than the amounts owed to holders of its preferred and common securities pursuant to the terms of those securities. Third parties will be entitled to enforce the expense agreement. Edison International's obligations under the expense agreement will be subordinated in right of payment to the same extent as the preferred securities guarantee. The expense agreement will contain provisions regarding amendment, termination, assignment, succession and governing law similar to those contained in the preferred securities guarantee. RELATIONSHIP AMONG PREFERRED SECURITIES, PREFERRED SECURITIES GUARANTEES AND SUBORDINATED DEBT SECURITIES HELD BY EACH TRUST Payments of distributions and redemption and liquidation payments due on each series of preferred securities (to the extent the applicable trust has funds available for the payments) will be guaranteed by Edison International to the extent described under "Description of the Preferred Securities Guarantees." No single document executed by Edison International in connection with the issuance of any series of preferred securities will provide for its full, irrevocable and unconditional guarantee of the preferred securities. It is only the combined operation of Edison International's obligations under the applicable preferred securities guarantee, Trust Agreement, subordinated indenture and subordinated debt securities and expense agreement that has the effect of providing a full, irrevocable and unconditional guarantee of a trust's obligations under its preferred securities. As long as Edison International makes payments of interest and other payments when due on the subordinated debt securities held by a trust, the payments will be sufficient to cover the payment of distributions and redemption and liquidation payments due on the preferred securities issued by that trust, primarily because: (a) the aggregate principal amount of the subordinated debt securities will be equal to the sum of the aggregate liquidation amounts of the preferred and common securities; (b) the interest rate and interest and other payment dates on the subordinated debt securities will match the distribution rate and distribution and other payment dates for the preferred securities; (c) Edison International has agreed to pay for any and all costs, expenses and liabilities of each trust except the trust's obligations under its preferred securities; and (d) each Trust Agreement provides that the related trust will not engage in any activity that is not consistent with the limited purposes of the trust. If and to the extent that Edison International does not make payments on the subordinated debt securities, the trust will not have funds available to make payments of distributions or other amounts due on its preferred securities. In those circumstances, a holder of preferred securities of the trust will not be able to rely upon the preferred securities guarantee for payment of these amounts. Instead, the holder may directly sue Edison International or seek other remedies to collect its pro rata share of payments owed. If a holder sues Edison International to collect payment, then Edison International will assume the holder's rights as a holder of preferred securities under the trust's Trust Agreement to the extent Edison International makes a payment to the holder in any legal action. 29 A holder of any preferred security may sue Edison International, or seek other remedies, to enforce its rights under the applicable preferred securities guarantee without first suing the applicable guarantee trustee, the trust which issued the preferred security or any other person or entity. EXPERTS The consolidated financial statements and schedule incorporated by reference in this prospectus and the registration statement of which this prospectus is a part have been audited by Arthur Andersen LLP, independent public accountants, as indicated in their reports with respect thereto, and are incorporated by reference herein in reliance upon the authority of said firm as experts in accounting and auditing in giving said reports. VALIDITY OF THE SECURITIES AND THE PREFERRED SECURITIES GUARANTEES Kenneth S. Stewart, Assistant General Counsel of Edison International, will pass upon the validity of the debt securities, the common and preferred stock and the preferred securities guarantees for Edison International. Richards, Layton & Finger, P.A. will pass upon certain matters of Delaware law relating to the validity of the preferred securities for Edison International and the trusts. PLAN OF DISTRIBUTION We may sell the securities described in this prospectus from time to time in one or more transactions (a) to purchasers directly; (b) to underwriters for public offering and sale by them; (c) through agents; (d) through dealers; or (e) through a combination of any of the foregoing methods of sale. We may distribute the securities from time to time in one or more transactions at: (a) a fixed price or prices, which may be changed; (b) market prices prevailing at the time of sale; (c) prices related to such prevailing market prices; or (d) negotiated prices. Direct Sales We may sell the securities directly to institutional investors or others who may be deemed to be underwriters within the meaning of the Securities Act of 1933, as amended, with respect to any resale of the securities. A prospectus supplement will describe the terms of any sale of securities we are offering hereunder. To Underwriters The applicable prospectus supplement will name any underwriter involved in a sale of securities. Underwriters may offer and sell securities at a fixed price or prices, which may be changed, or from time to time at market prices or at negotiated prices. Underwriters may be deemed to have received 30 compensation from us from sales of securities in the form of underwriting discounts or commissions and may also receive commissions from purchasers of securities for whom they may act as agent. Underwriters may be involved in any at the market offering of equity securities by or on our behalf. Underwriters may sell securities to or through dealers, and such dealers may receive compensation in the form of discounts, concessions or commissions from the underwriters and/or commissions (which may be changed from time to time) from the purchasers for whom they may act as agent. Unless otherwise provided in a prospectus supplement, the obligations of any underwriters to purchase securities will be subject to certain conditions precedent, and the underwriters will be obligated to purchase all the securities if any are purchased. Through Agents and Dealers We will name any agent involved in a sale of securities, as well as any commissions payable by us to such agent, in a prospectus supplement. Unless we indicate differently in the prospectus supplement, any such agent will be acting on a reasonable efforts basis for the period of its appointment. If we utilize a dealer in the sale of the securities being offered pursuant to their prospectus, we will sell the securities to the dealer, as principal. The dealer may then resell the securities to the public at varying prices to be determined by the dealer at the time of resale. Delayed Delivery Contracts If we so specify in the applicable prospectus supplement, we will authorize underwriters, dealers and agents to solicit offers by certain institutions to purchase the securities pursuant to contracts providing for payment and delivery on future dates. Such contracts will be subject to only those conditions set forth in the applicable prospectus supplement. The underwriters, dealers and agents will not be responsible for the validity or performance of the contracts. We will set forth in the prospectus supplement relating to the contracts the price to be paid for the securities, the commissions payable for solicitation of the contracts and the date in the future for delivery of the securities. General Information Underwriters, dealers and agents participating in a sale of the securities may be deemed to be underwriters as defined in the Securities Act, and any discounts and commissions received by them and any profit realized by them on resale of the securities may be deemed to be underwriting discounts and commissions, under the Securities Act. We may have agreements with underwriters, dealers and agents to indemnify them against certain civil liabilities, including liabilities under the Securities Act, and to reimburse them for certain expenses. Underwriters or agents and their associates may be customers of, engage in transactions with or perform services for us or our affiliates in the ordinary course of business. Unless we indicate differently in a prospectus supplement, we will not list the securities on any securities exchange. The securities will be a new issue of securities with no established trading market. Any underwriters that purchase securities for public offering and sale may make a market in such securities, but such underwriters will not be obligated to do so and may discontinue any market making at any time without notice. We make no assurance as to the liquidity of or the trading markets for any securities. 31 - ------------------------------------------------------------------------------- - ------------------------------------------------------------------------------- No dealer, salesperson or other person is authorized to give any information or to represent anything not contained in this prospectus. You must not relay on any unauthorized information or representations. This prospectus is an offer to sell only the QUIPS offered hereby, but only under circumstances and in jurisdictions where it is lawful to do so. The information contained in this prospectus is current only as of its date. ------------ TABLE OF CONTENTS Prospectus Supplement
Page ---- Summary Information--Q&A.................................................. S-2 Risk Factors.............................................................. S-6 Accounting Treatment...................................................... S-9 Use of Proceeds........................................................... S-9 Description of the Series A QUIPS......................................... S-10 Description of the Series A QUIDS......................................... S-17 Book-Entry Issuance....................................................... S-24 Material United States Federal Income Tax Considerations.................. S-28 Underwriting.............................................................. S-34 Validity of Series A QUIPS, Series A QUIDS and Series A QUIPS Guarantee... S-36 Prospectus About This Prospectus..................................................... 3 Forward-Looking Statements................................................ 3 Where You Can Find More Information....................................... 4 Edison International...................................................... 5 The Trusts................................................................ 6 Use of Proceeds........................................................... 7 Ratio of Edison International Earnings to Fixed Charges and Preferred Stock Dividends.......................................................... 7 Description of Securities................................................. 8 Description of Debt Securities............................................ 8 Description of Edison International's Common Stock and Preferred Stock.... 17 Description of Preferred Securities....................................... 20 Description of Preferred Securities Guarantees............................ 27 Description of the Expense Agreements..................................... 29 Relationship Among Preferred Securities, Preferred Securities Guarantees and Subordinated Debt Securities Held By Each Trust...................... 29 Experts................................................................... 30 Validity of the Securities and the Preferred Securities Guarantees........ 30 Plan of Distribution...................................................... 30
- ------------------------------------------------------------------------------- - ------------------------------------------------------------------------------- - ------------------------------------------------------------------------------- - ------------------------------------------------------------------------------- 20,000,000 Preferred Securities EIX Trust I % Cumulative Quarterly Income Preferred Securities, Series A (QUIPSSM) (Liquidation Amount $25 per QUIPS) Fully and unconditionally guaranteed, as described herein, by Edison International ------------ PROSPECTUS SUPPLEMENT ------------ Goldman, Sachs & Co. A.G. Edwards & Sons, Inc. Lehman Brothers Merrill Lynch & Co. Morgan Stanley Dean Witter PaineWebber Incorporated Prudential Securities Incorporated Salomon Smith Barney Representatives of the Underwriters - ------------------------------------------------------------------------------- - ------------------------------------------------------------------------------- PART II. INFORMATION NOT REQUIRED IN PROSPECTUS Item 14. Other Expenses of Issuance and Distribution. Securities and Exchange Commission registration fee........... $ 695,000.00 Printing expenses............................................. $ 5,000.00 Trustee fees and expenses..................................... $ 14,000.00 Legal fees and expenses....................................... $ 150,000.00 Accounting fees and expenses.................................. $ 50,000.00 Blue Sky fees and expenses.................................... $ 20,000.00 Rating Agency fees............................................ $ 205,000.00 Miscellaneous................................................. $ 10,000.00 ------------- Total....................................................... $1,149,000.00 =============
Item 15. Indemnification of Officers and Directors. Section 317 of the California Corporations Code provides that a corporation shall have the power to indemnify any person who was or is a party or is threatened to be made a party to any proceeding or action by reason of the fact that he or she is or was a director, officer, employee or other agent of such corporation or is or was serving at the request of the corporation as a director, officer, employee or agent of another corporation or other enterprise. Section 317 also grants authority to a corporation to include in its articles of incorporation indemnification provisions in excess of that permitted in Section 317, subject to certain limitations. Article Sixth of the Restated Articles of Incorporation of Edison International authorizes Edison International to provide indemnification of directors, officers, employees, and other agents through bylaw provisions, agreements with agents, votes of shareholders or disinterested directors, or otherwise, in excess of the indemnification otherwise permitted by Section 317 of the California Corporations Code, subject only to the applicable limits set forth in Section 204 of the California Corporations Code. Article VI of the Amended Bylaws of Edison International contains provisions implementing the authority granted in Article Sixth of the Articles of Incorporation. The Bylaws provide for the indemnification of any director or officer of Edison International, or any person acting at the request of Edison International as a director, officer, employee or agent of another corporation or other enterprise, for any threatened, pending or completed action, suit or proceeding to the fullest extent permissible under California law and the Restated Articles of Incorporation of Edison International, subject to the terms of any agreement between Edison International and such a person; provided that, no such person shall be indemnified: (i) except to the extent that the aggregate of losses to be indemnified exceeds the amount of such losses for which the director or officer is paid pursuant to any director's or officer's liability insurance policy maintained by Edison International; (ii) on account of any suit in which judgment is rendered for an accounting of profits made from the purchase or sale of securities of Edison International pursuant to Section 16(b) of the Securities Exchange Act of 1934 and amendments thereto or similar provisions of any federal, state or local statutory law; (iii) if a court of competent jurisdiction finally determines that the indemnification is unlawful; (iv) for acts or omissions involving intentional misconduct or knowing and culpable violation of law; (v) for acts or omissions that the director or officer believes to be contrary to the best interests of Edison International or its shareholders, or that involve the absence of good faith; (vi) for any transaction from which the director or officer derived an improper personal benefit; (vii) for acts or omissions that show a reckless disregard for the director's or officer's duty to Edison International or its shareholders in circumstances in which the director or officer was aware, or should have been II-1 aware, in the ordinary course of performing his or her duties, of a risk of serious injury to Edison International or its shareholders; (viii) for acts or omissions that constitute an unexcused pattern of inattention that amount to an abdication of the director's or officer's duties to Edison International or its shareholders; (ix) for costs, charges, expenses, liabilities and losses arising under Section 310 or 316 of the California Corporation Code; or (x) as to circumstances in which indemnity is expressly prohibited by Section 317 of the California Corporation Code. The exclusions set forth in clauses (iv) through (ix) above shall apply only to indemnification with regard to any action brought by or in the right of Edison International for breach of duty to Edison International or its shareholders. The Amended Bylaws of Edison International also provide that Edison International shall indemnify any director or officer in connection with (a) a proceeding (or part thereof) initiated by him or her only if such proceeding (or part thereof) was authorized by the Board of Directors or (b) a proceeding (or part thereof), other than a proceeding by or in the name of Edison International to procure a judgment in its favor, only if any settlement of such a proceeding is approved in writing by Edison International. Indemnification shall cover all costs, charges, expenses, liabilities and losses, including attorneys' fees, judgments, fines, ERISA excise taxes, or penalties and amounts paid or to be paid in settlement, reasonably incurred or suffered by the director or officer. Edison International has directors' and officers' liability insurance policies in force insuring directors and officers of Edison International and its subsidiaries. Edison International has also entered into written agreements with each of its directors incorporating the indemnification provisions of the Bylaws. Item 16. Exhibits. 1.1 Underwriting Agreement (Preferred Securities). *1.2 Underwriting Agreement (Senior Debt Securities). *1.3 Underwriting Agreement (Subordinated Debt Securities). *1.4 Underwriting Agreement (Common Stock). *1.5 Underwriting Agreement (Preferred Stock). +3.1 Restated Articles of Incorporation of Edison International dated May 7, 1998 (Incorporated by reference from the Annual Report on Form 10-K for the year ended December 31, 1998, File No. 1-9936 (Exhibit 3.1)). +3.2 Certificate of Determination of Series A Junior Participating Cumulative Preferred Stock of Edison International dated November 21, 1996 (Incorporated by reference from the Registration Statement on Form 8-A filed November 21, 1996 (Exhibit 4.2)). +3.3 Amended Bylaws of Edison International as adopted by the Board of Directors on April 15, 1999 (Incorporated by reference from the Quarterly Report on Form 10-Q for the quarterly period ended March 31, 1999, File No. 1-9936 (Exhibit 3.3)). +3.4 Certificate of Trust of EIX Trust I. +3.5 Certificate of Trust of EIX Trust II. +3.6 Certificate of Trust of EIX Trust III. +4.1 Form of Indenture for Senior Debt Securities. +4.2 Form of Indenture for Subordinated Debt Securities. *4.3 Form of Supplemental Indenture. +4.4 Form of Senior Note (included in Exhibit 4.1). +4.5 Form of Subordinated Note (included in Exhibit 4.2). +4.6 Form of Preferred Security (included in Exhibit 4.11). +4.7 Form of Preferred Securities Guarantee.
II-2 +4.8 Trust Agreement of EIX Trust I. +4.9 Trust Agreement of EIX Trust II. +4.10 Trust Agreement of EIX Trust III. +4.11 Form of Amended and Restated Trust Agreement for each of EIX Trust I, EIX Trust II and EIX Trust III. +4.12 Form of Expense Agreement for each of EIX Trust I, EIX Trust II and EIX Trust III (included in Exhibit 4.11). +4.13 Rights Agreement dated November 21, 1996 between Edison International and Harris Trust Company of California, as rights agent (Incorporated by reference from the Registration Statement on Form 8-A filed November 21, 1996 (Exhibit 4.1)). +5.1 Opinion of Kenneth S. Stewart, Assistant General Counsel of Edison International. +5.2 Opinion of Richards, Layton & Finger, P.A. relating to EIX Trust I. +5.3 Opinion of Richards, Layton & Finger, P.A. relating to EIX Trust II. +5.4 Opinion of Richards, Layton & Finger, P.A. relating to EIX Trust III. +8.1 Opinion of Latham & Watkins relating to tax matters. +12.1 Statement regarding the computation of ratio of earnings to combined fixed charges and preferred stock dividends for the years ended December 31, 1998, 1997, 1996, 1995 and 1994. +23.1 Consent of Kenneth S. Stewart, Assistant General Counsel of Edison International (included in Exhibit 5.1). +23.2 Consents of Richards, Layton & Finger, P.A. (included in Exhibits 5.2, 5.3 and 5.4). +23.3 Consent of Independent Public Accountants (Arthur Andersen LLP). +24.1 Power of Attorney (as to Edison International). +24.2 Certified Resolution of Edison International. +25.1 Statement of Eligibility on Form T-1 under the Trust Indenture Act of 1939, as amended, of Harris Trust and Savings Bank, as Trustee under the Indenture (Senior Debt Securities). +25.2 Statement of Eligibility on Form T-1 under the Trust Indenture Act of 1939, as amended, of The Chase Manhattan Bank, as Trustee under the Indenture (Subordinated Debt Securities). +25.3 Statement of Eligibility on Form T-1 under the Trust Indenture Act of 1939, as amended, of The Chase Manhattan Bank, as Property Trustee-- EIX Trust I. +25.4 Statement of Eligibility on Form T-1 under the Trust Indenture Act of 1939, as amended, of The Chase Manhattan Bank, as Property Trustee-- EIX Trust II. +25.5 Statement of Eligibility on Form T-1 under the Trust Indenture Act of 1939, as amended, of The Chase Manhattan Bank, as Property Trustee-- EIX Trust III. +25.6 Statement of Eligibility on Form T-1 under the Trust Indenture Act of 1939, as amended, of The Chase Manhattan Bank, as Guarantee Trustee-- EIX Trust I. +25.7 Statement of Eligibility on Form T-1 under the Trust Indenture Act of 1939, as amended, of The Chase Manhattan Bank, as Guarantee Trustee-- EIX Trust II. +25.8 Statement of Eligibility on Form T-1 under the Trust Indenture Act of 1939, as amended, of The Chase Manhattan Bank, as Guarantee Trustee-- EIX Trust III.
- -------- *To be filed by amendment or incorporated by reference pursuant to subsequent filings by Edison International. +Previously filed. II-3 Item 17. Undertakings. The undersigned registrants hereby undertake: (1) To file, during any period in which offers or sales are being made, a post-effective amendment to this Registration Statement: (i) to include any prospectus required by Section 10(a)(3) of the Securities Act; (ii) to reflect in the prospectus any facts or events arising after the effective date of the Registration Statement (or the most recent post-effective amendment thereof) which, individually or in the aggregate, represent a fundamental change in the information set forth in the Registration Statement. Notwithstanding the foregoing, any increase or decrease in volume of securities offered (if the total dollar value of securities offered would not exceed that which was registered) and any deviation from the low or high end of the estimated maximum offering range may be reflected in the form of prospectus filed with the Securities and Exchange Commission pursuant to Rule 424(b) if, in the aggregate, the changes in volume and price represent no more than a 20% change in the maximum aggregate offering price set forth in the "Calculation of Registration Fee" table in the effective Registration Statement; and (iii) to include any material information with respect to the plan of distribution not previously disclosed in the Registration Statement or any material change to such information in the Registration Statement; provided, however, that (i) and (ii) do not apply if the information required to be included in a post-effective amendment by those paragraphs is contained in periodic reports filed with or furnished to the Securities and Exchange Commission by the registrants pursuant to Section 13 or Section 15(d) of the Exchange Act that are incorporated by reference in the Registration Statement. (2) That, for the purpose of determining any liability under the Securities Act, each such post-effective amendment shall be deemed to be a new registration statement relating to the securities offered therein, and the offering of such securities at that time shall be deemed to be the initial bona fide offering thereof. (3) To remove from registration by means of post-effective amendment any of the securities being registered which remain unsold at the termination of the offering. (4) That, for purposes of determining any liability under the Securities Act, each filing of Edison International's annual report pursuant to Section 13(a) or Section 15(d) of the Exchange Act that is incorporated by reference in this Registration Statement shall be deemed to be a new registration statement relating to the securities offered herein, and the offering of such securities at that time shall be deemed to be the initial bona fide offering thereof. (5) To file an application for the purpose of determining the eligibility of the trustees to act under subsection (a) of Section 310 of the Trust Indenture Act in accordance with the rules and regulations prescribed by the Securities and Exchange Commission under Section 305(b)(2) of the Securities Act. Insofar as indemnification for liabilities arising under the Securities Act may be permitted to directors, officers and controlling persons of the registrants pursuant to the provisions described under Item 15 above, or otherwise, the registrants have been advised that in the opinion of the Securities and Exchange Commission such indemnification is against public policy as expressed in the Securities Act and is, therefore, unenforceable. In the event that a claim for indemnification against such liabilities (other than the payment by a registrant of expenses incurred or paid by a director, officer or controlling person in the successful defense of any action, suit or proceeding) is asserted by such director, officer or controlling person in connection with the securities being registered, such registrant will, unless in the opinion of its counsel the matter has been settled by controlling precedent, submit to a court of appropriate jurisdiction the question whether such indemnification by it is against public policy as expressed in the Securities Act and will be governed by the final adjudication of such issue. II-4 SIGNATURES Pursuant to the requirements of the Securities Act of 1933, as amended, Edison International certifies that it has reasonable grounds to believe that it meets all of the requirements for filing on Form S-3 and has duly caused this Amendment No. 1 to Registration Statement to be signed on its behalf by the undersigned, thereunto duly authorized, in the City of Rosemead, and State of California, on the 13th day of July, 1999. EDISON INTERNATIONAL /s/ Mary C. Simpson By __________________________________ Mary C. Simpson Assistant Treasurer Pursuant to the requirements of the Securities Act of 1933, as amended, this Amendment No. 1 to Registration Statement has been signed below by the following persons in the capacities indicated on the 13th day of July, 1999.
Signature Title --------- ----- * Principal Executive ______________________________________ Officer; Chairman of the John E. Bryson Board, Chief Executive Officer and Director * Principal Financial ______________________________________ Officer; Executive Vice Alan J. Fohrer President and Chief Financial Officer * Controller; Vice President ______________________________________ and Controller Thomas M. Noonan * Director ______________________________________ Winston H. Chen * Director ______________________________________ Warren Christopher * Director ______________________________________ Stephen E. Frank * Director ______________________________________ Joan C. Hanley * Director ______________________________________ Carl F. Huntsinger
II-5
Signature Title --------- ----- * Director ______________________________________ Charles D. Miller * Director ______________________________________ Luis G. Nogales * Director ______________________________________ Ronald L. Olson * Director ______________________________________ James M. Rosser * Director ______________________________________ Robert H. Smith * Director ______________________________________ Thomas C. Sutton * Director ______________________________________ Daniel M. Tellep * Director ______________________________________ Edward Zapanta
*By: /s/ Mary C. Simpson _________________________________ Mary C. Simpson (as Attorney-in-Fact) II-6 SIGNATURES Pursuant to the requirements of the Securities Act of 1933, as amended, the registrant certifies that it has reasonable grounds to believe that it meets all of the requirements for filing on Form S-3 and has duly caused this Amendment No. 1 to Registration Statement to be signed on its behalf by the undersigned, thereunto duly authorized, in the City of Rosemead, and State of California, on the 13th day of July, 1999. EIX TRUST I By: EDISON INTERNATIONAL, as Depositor /s/ Mary C. Simpson By: _________________________ Mary C. Simpson Assistant Treasurer II-7 SIGNATURES Pursuant to the requirements of the Securities Act of 1933, as amended, the registrant certifies that it has reasonable grounds to believe that it meets all of the requirements for filing on Form S-3 and has duly caused this Amendment No. 1 to Registration Statement to be signed on its behalf by the undersigned, thereunto duly authorized, in the City of Rosemead, and State of California, on the 13th day of July, 1999. EIX TRUST II By: EDISON INTERNATIONAL, as Depositor /s/ Mary C. Simpson By: _________________________ Mary C. Simpson Assistant Treasurer II-8 SIGNATURES Pursuant to the requirements of the Securities Act of 1933, as amended, the registrant certifies that it has reasonable grounds to believe that it meets all of the requirements for filing on Form S-3 and has duly caused this Amendment No. 1 to Registration Statement to be signed on its behalf by the undersigned, thereunto duly authorized, in the City of Rosemead, and State of California, on the 13th day of July, 1999. EIX TRUST III By: EDISON INTERNATIONAL, as Depositor /s/ Mary C. Simpson By: _________________________ Mary C. Simpson Assistant Treasurer II-9 EDISON INTERNATIONAL EIX TRUST I EIX TRUST II EIX TRUST III REGISTRATION STATEMENT ON FORM S-3 EXHIBIT INDEX
Exhibit No. Description ------- ----------- 1.1 Underwriting Agreement (Preferred Securities). *1.2 Underwriting Agreement (Senior Debt Securities). *1.3 Underwriting Agreement (Subordinated Debt Securities). *1.4 Underwriting Agreement (Common Stock). *1.5 Underwriting Agreement (Preferred Stock). +3.1 Restated Articles of Incorporation of Edison International dated May 7, 1998 (Incorporated by reference from Annual Report on Form 10-K for the year ended December 31, 1998, File No. 1-9936 (Exhibit 3.1)). +3.2 Certificate of Determination of Series A Junior participating Cumulative Preferred Stock of Edison International dated November 21, 1996 (Incorporated by reference from the Registration Statement on Form 8-A filed November 21, 1996 (Exhibit 4.2)). +3.3 Amended Bylaws of Edison International as adopted by the Board of Directors on April 15, 1999 (Incorporated by reference from the Quarterly Report on Form 10-Q for the quarterly period ended March 31, 1999, File No. 1-9936 (Exhibit 3.3)). +3.4 Certificate of Trust of EIX Trust I. +3.5 Certificate of Trust of EIX Trust II. +3.6 Certificate of Trust of EIX Trust III. +4.1 Form of Indenture for Senior Debt Securities. +4.2 Form of Indenture for Subordinated Debt Securities. *4.3 Form of Supplemental Indenture. +4.4 Form of Senior Note (included in Exhibit 4.1). +4.5 Form of Subordinated Note (included in Exhibit 4.2). +4.6 Form of Preferred Security (included in Exhibit 4.11). +4.7 Form of Preferred Securities Guarantee. +4.8 Trust Agreement of EIX Trust I. +4.9 Trust Agreement of EIX Trust II. +4.10 Trust Agreement of EIX Trust III. +4.11 Form of Amended and Restated Trust Agreement for each of EIX Trust I, EIX Trust II and EIX Trust III. +4.12 Form of Expense Agreement for each of EIX Trust I, EIX Trust II and EIX Trust III (included in Exhibit 4.11). +4.13 Rights Agreement dated November 21, 1996 between Edison International and Harris Trust Company of California, as rights agent (Incorporated by reference from the Registration Statement on Form 8-A filed November 21, 1996 (Exhibit 4.1)).
1
Exhibit No. Description ------- ----------- +5.1 Opinion of Kenneth S. Stewart, Assistant General Counsel of Edison International. +5.2 Opinion of Richards, Layton & Finger, P.A. relating to EIX Trust I. +5.3 Opinion of Richards, Layton & Finger, P.A. relating to EIX Trust II. +5.4 Opinion of Richards, Layton & Finger, P.A. relating to EIX Trust III. +8.1 Opinion of Latham & Watkins relating to tax matters. +12.1 Statement regarding the computation of ratio of earnings to combined fixed charges and preferred stock dividends for the years ended December 31, 1998, 1997, 1996, 1995 and 1994. +23.1 Consent of Kenneth S. Stewart, Assistant General Counsel of Edison International (included in Exhibit 5.1). +23.2 Consents of Richards, Layton & Finger, P.A. (included in Exhibits 5.2, 5.3 and 5.4). +23.3 Consent of Independent Public Accountants (Arthur Andersen LLP). +24.1 Power of Attorney (as to Edison International). +24.2 Certified Resolution of Edison International. +25.1 Statement of Eligibility on Form T-1 under the Trust Indenture Act of 1939, as amended, Harris Trust and Savings Bank, as Trustee under the Indenture (Senior Debt Securities). +25.2 Statement of Eligibility on Form T-1 under the Trust Indenture Act of 1939, as amended, The Chase Manhattan Bank, as Trustee under the Indenture (Subordinated Debt Securities). +25.3 Statement of Eligibility on Form T-1 under the Trust Indenture Act of 1939, as amended, of The Chase Manhattan Bank, as Property Trustee-- EIX Trust I. +25.4 Statement of Eligibility on Form T-1 under the Trust Indenture Act of 1939, as amended, of The Chase Manhattan Bank, as Property Trustee-- EIX Trust II. +25.5 Statement of Eligibility on Form T-1 under the Trust Indenture Act of 1939, as amended, of The Chase Manhattan Bank, as Property Trustee-- EIX Trust III. +25.6 Statement of Eligibility on Form T-1 under the Trust Indenture Act of 1939, as amended, of The Chase Manhattan Bank, as Guarantee Trustee-- EIX Trust I. +25.7 Statement of Eligibility on Form T-1 under the Trust Indenture Act of 1939, as amended, of The Chase Manhattan Bank, as Guarantee Trustee-- EIX Trust II. +25.8 Statement of Eligibility on Form T-1 under the Trust Indenture Act of 1939, as amended, of The Chase Manhattan Bank, as Guarantee Trustee-- EIX Trust III.
- -------- * To be filed by amendment or incorporated by reference pursuant to subsequent filings by Edison International. + Previously filed. 2 EX-1.1 2 UNDERWRITING AGREEMENT (PREFERRED SECURITIES) EXHIBIT 1.1 EIX Trust I EIX Trust II EIX Trust III Preferred Securities guaranteed to the extent set forth in the Guarantees by Edison International Underwriting Agreement ---------------------- July ___, 1999 To the Representatives of the several Underwriters named in the respective Pricing Agreements hereinafter described Ladies and Gentlemen: From time to time EIX Trust I, EIX Trust II or EIX Trust III, each a statutory business trust formed under the laws of the State of Delaware (each a "Trust" and collectively the "Trusts"), and Edison International, a California corporation (the "Company"), as depositor of each Trust and as guarantor, propose to enter into one or more Pricing Agreements (each a "Pricing Agreement") in the form of Annex I hereto, with such additions and deletions as the parties thereto may determine, and, subject to the terms and conditions stated herein and therein, that the Trust identified in the applicable Pricing Agreement (such Trust being the "Designated Trust" with respect to such Pricing Agreement) issue and sell to the firms named in Schedule I to the applicable Pricing Agreement (such firms constituting the "Underwriters" with respect to such Pricing Agreement and the securities specified therein) certain of its preferred securities (the "Securities") representing undivided beneficial interests in the assets of the Designated Trust. The Securities specified in such Pricing Agreement are referred to as the "Firm Designated Securities" with respect to such Pricing Agreement. If specified in such Pricing Agreement, the Designated Trust may grant the Underwriters the right to purchase at their election an additional number of Securities, specified as provided in such Pricing Agreement as provided in Section 3 hereof (the "Optional Designated Securities"). The Firm Designated Securities and any Optional Designated Securities are collectively called the "Designated Securities." The proceeds of the sale of the Designated Securities to the public and of common securities of the Designated Trust (the "Common Securities") to the Company concurrently with the sale of the Designated Securities are to be invested in subordinated deferrable interest debentures of the Company (the "Subordinated Debentures") identified in the Pricing Agreement with respect to such Designated Securities (with respect to such Pricing Agreement, the "Designated Subordinated Debentures"), to be issued pursuant to a subordinated indenture to be dated as of July [___], 1999 (as supplemented or amended from time to time, the "Subordinated Indenture") between the Company and The Chase Manhattan Bank, as trustee (the "Indenture Trustee"). The Designated Securities will be guaranteed by the Company to the extent set forth in a Guarantee Agreement between the Company and The Chase Manhattan Bank, as trustee, with respect to such Designated Securities (the "Designated Guarantee") (all such Designated Guarantees together, the "Guarantees"). The terms and rights of any particular issuance of Designated Securities shall be as specified in the Pricing Agreement relating thereto and in or pursuant to the amended and restated trust agreement identified in such Pricing Agreement (with respect to such Pricing Agreement, the "Trust Agreement"). 1. Particular sales of Designated Securities may be made from time to time to the Underwriters of such Securities, for whom the firms designated as representatives of the Underwriters of such Securities in the Pricing Agreement relating thereto will act as representatives (the "Representatives"). The term "Representatives" also refers to a single firm acting as sole representative of the Underwriters and to an Underwriter or Underwriters who act without any firm being designated as its or their representatives. This Underwriting Agreement shall not be construed as an obligation of any Trust to sell any of the Securities or as an obligation of any of the Underwriters to purchase the Securities. The obligation of any Trust to issue and sell any of the Securities and the obligation of any of the Underwriters to purchase any of the Securities shall be evidenced by the Pricing Agreement with respect to the Designated Securities specified therein. Each Pricing Agreement shall specify the aggregate liquidation amount of Firm Designated Securities, the maximum aggregate liquidation amount of Optional Designated Securities, if any, the initial public offering price of such Firm Designated Securities and Optional Designated Securities or the manner of determining such price, the terms of the Designated Securities, including the terms on which and terms of the securities into which the Designated Securities will be exchangeable, the purchase price to the Underwriters of such Designated Securities, the names of the Underwriters of such Designated Securities, the names of the Representatives of such Underwriters and the number of such Designated Securities to be purchased by each Underwriter and the commission, if any, payable to the Underwriters with respect thereto and shall set forth the date, time and manner of delivery of such Firm Designated Securities and such Optional Designated Securities, if any, and payment therefor. The Pricing Agreement shall also specify (to the extent not set forth in the Trust Agreement and the registration statement and prospectus with respect thereto) the terms of such Designated Securities. A Pricing Agreement shall be in the form of an executed writing (which may be in counterparts), and may be evidenced by an exchange of telegraphic communications or any other rapid transmission device designed to produce a written record of communications transmitted. The obligations of the Underwriters under this Agreement and each Pricing Agreement shall be several and not joint. 2. Each of the Company and the Designated Trust, jointly and severally, represents and warrants to, and agrees with, each of the Underwriters that: 2 (a) A registration statement on Form S-3 (File No 333-82293) (the "Initial Registration Statement") in respect of the Securities, the Subordinated Debentures and the Guarantees has been filed with the Securities and Exchange Commission (the "Commission"); the Initial Registration Statement and any post-effective amendment thereto, each in the form heretofore delivered or to be delivered to the Representatives, have been declared effective by the Commission in such form; other than a registration statement, if any, increasing the size of the offering (a "Rule 462(b) Registration Statement"), filed pursuant to Rule 462(b) under the Securities Act of 1933, as amended (the "Act"), which became effective upon filing, no other document with respect to the Initial Registration Statement or document incorporated by reference therein has heretofore been filed or transmitted for filing with the Commission (other than documents filed after the filing date of the Initial Registration Statement under the Securities Exchange Act of 1934, as amended (the "Exchange Act"), and prospectuses filed pursuant to Rule 424(b) of the rules and regulations of the Commission under the Act, each in the form heretofore delivered to the Representatives); and no stop order suspending the effectiveness of the Initial Registration Statement, any post-effective amendment thereto or the Rule 462(b) Registration Statement, if any, has been issued and no proceeding for that purpose has been initiated or threatened by the Commission (any preliminary prospectus included in the Initial Registration Statement or filed with the Commission pursuant to Rule 424(a) under the Act, is hereinafter called a "Preliminary Prospectus"; the various parts of the Initial Registration Statement, any post-effective amendment thereto and the Rule 462(b) Registration Statement, if any, including (i) the information contained in the form of any final prospectus filed with the Commission pursuant to Rule 424(b) under the Act and deemed by virtue of Rule 430A under the Act to be part of the Initial Registration Statement at the time it was declared effective or such part of the Rule 462(b) Registration Statement, if any, became or hereafter becomes effective, (ii) all exhibits thereto and (iii) the documents incorporated by reference in the prospectus contained in the Initial Registration Statement at the time such part of the Initial Registration Statement became effective but excluding Form T-1, each as amended at the time such part of the Initial Registration Statement became effective or such part of the Rule 462(b) Registration Statement, if any, became or hereafter becomes effective, are hereinafter collectively called the "Registration Statement"; the prospectus relating to the Securities, the Subordinated Debentures and the Guarantees, in the form in which it has most recently been filed, or transmitted for filing, with the Commission on or prior to the date of this Agreement, is hereinafter called the "Prospectus"; any reference herein to any Preliminary Prospectus or the Prospectus shall be deemed to refer to and include the documents incorporated by reference therein pursuant to the applicable form under the Act, as of the date of such Preliminary Prospectus or Prospectus, as the case may be; any reference to any amendment or supplement to any Preliminary Prospectus or the Prospectus shall be deemed to refer to and include any documents filed after the date of such Preliminary Prospectus or Prospectus, as the case may be, under the Exchange Act and incorporated by reference in such Preliminary Prospectus or Prospectus, as the case may be, as of the date of filing of such document; any reference to any amendment to the Initial Registration Statement shall be deemed to refer to and include any annual report of 3 either the Trusts or the Company filed pursuant to Sections 13(a) or 15(d) of the Exchange Act after the effective date of the Initial Registration Statement that is incorporated by reference in the Registration Statement; and any reference to the Prospectus as amended or supplemented shall be deemed to refer to the Prospectus as amended or supplemented in relation to the applicable Designated Securities in the form in which it is filed with the Commission pursuant to Rule 424(b) under the Act in accordance with Section 5(a) hereof, including any documents incorporated by reference therein as of the date of such filing); (b) The documents incorporated by reference in the Prospectus, when they became effective or were filed with the Commission, as the case may be, conformed in all material respects to the requirements of the Act or the Exchange Act, as applicable, and the rules and regulations of the Commission thereunder; the Prospectus at the time it was filed did not include an untrue statement of a material fact or omit to state a material fact necessary in order to make the statements therein, in the light of the circumstances under which they were made, not misleading; and any further documents so filed and incorporated by reference in the Prospectus or any further amendment or supplement thereto, when such documents become effective or are filed with the Commission, as the case may be, will conform in all material respects to the requirements of the Act or the Exchange Act, as applicable, and the rules and regulations of the Commission thereunder and will not include an untrue statement of a material fact or omit to state a material fact necessary in order to make the statements therein, in the light of the circumstances under which they were made, not misleading; provided, however, that this representation and warranty shall not apply to any statements or omissions made in reliance upon and in conformity with information furnished in writing to the Company by an Underwriter of Designated Securities through the Representatives expressly for use in the Prospectus as amended or supplemented relating to such Securities; (c) The Registration Statement conforms, and any further amendments or supplements to the Registration Statement will conform, in all material respects to the requirements of the Act and the Trust Indenture Act of 1939, as amended (the "Trust Indenture Act"), and the rules and regulations of the Commission thereunder and does not and will not, as of the applicable effective date as to the Registration Statement and any amendment thereto, contain an untrue statement of a material fact or omit to state a material fact required to be stated therein or necessary to make the statements therein not misleading; provided, however, that this representation and warranty shall not apply to any statements or omissions made in reliance upon and in conformity with information furnished in writing to the Company by an Underwriter of Designated Securities through the Representatives expressly for use in the Prospectus as amended or supplemented relating to such Securities; (d) Neither the Designated Trust nor the Company and any of its subsidiaries (other than the Designated Trust) taken as a whole has sustained since the date of the latest audited financial statements included or incorporated by reference in the Prospectus 4 any material loss or interference with its business from fire, explosion, flood or other calamity, whether or not covered by insurance, or from any labor dispute or court or governmental action, order or decree, otherwise than as set forth or contemplated in the Prospectus; and, since the respective dates as of which information is given in the Registration Statement and the Prospectus, there has not been any change in the capital stock or long-term debt of the Designated Trust, in either case in an aggregate amount in excess of $__________, or of the Company and its subsidiaries (other than the Designated Trust) taken as a whole, in either case in an aggregate amount in excess of $__________, or any material adverse change, or any development involving a prospective material adverse change, in or affecting the general affairs, management, financial position, stockholders' equity or results of operations of the Designated Trust or the Company and its subsidiaries (other than the Designated Trust) taken as a whole, otherwise than as set forth or contemplated in the Prospectus; (e) The Designated Trust has been duly created and is validly existing as a business trust in good standing under the laws of the State of Delaware, with power and authority to conduct its business as described in the Prospectus; (f) The Company has been duly incorporated and is validly existing as a corporation in good standing under the laws of the jurisdiction of its incorporation, with power and authority (corporate and other) to own its properties and conduct its business as described in the Prospectus; (g) The Company has an authorized capitalization as set forth in the Prospectus, and all of the issued shares of capital stock of the Company have been duly and validly authorized and issued and are fully paid and non-assessable; all the outstanding beneficial interests in the Designated Trust have been duly and validly authorized and issued, are fully paid and non-assessable and conform in all material respects to the descriptions thereof contained in the Prospectus; (h) Each of Southern California Edison Company, Edison Mission Energy and Edison Capital (the "Significant Subsidiaries") has been duly incorporated and is validly existing as a corporation in good standing under the laws of the jurisdiction of its incorporation, has power and authority (corporate and other) to own, lease and operate its properties and to conduct its business as described in the Prospectus, and is duly qualified as a foreign corporation to transact business and is in good standing in each jurisdiction in which such qualification is required, whether by reason of ownership or leasing of property or the conduct of business, except where the failure so to qualify or be in good standing would not have a material adverse effect on the condition, financial or otherwise, or the earnings or business affairs of the Company and its subsidiaries taken as a whole; and all of the issued and outstanding capital stock of each Significant Subsidiary has been duly authorized and validly issued, is fully paid and non-assessable and all such shares owned by the Company, directly or through subsidiaries, are owned free and clear of any security interest, mortgage, pledge, lien, encumbrance, claim or security; 5 (i) When the Designated Securities are issued and delivered pursuant to this Agreement and the Pricing Agreement with respect to such Designated Securities and, in the case of any Optional Designated Securities, pursuant to Over-allotment Options (as defined in Section 3 hereof) with respect to such Securities, such Designated Securities will be duly and validly authorized and issued and will be fully paid and non-assessable beneficial interests in the Designated Trust entitled to the benefits provided by the applicable Trust Agreement; the issuance of the Designated Securities will not be subject to preemptive or other similar right; and the Designated Securities will conform in all material respects to the description thereof contained in the Prospectus as amended or supplemented with respect to such Designated Securities; (j) The holders of the Designated Securities (the "Securityholders") will be entitled to the same limitation of personal liability extended to stockholders of private corporations for profit organized under the General Corporation Law of the State of Delaware; (k) When the Common Securities of the Designated Trust are issued and delivered pursuant to the applicable Trust Agreement, such Common Securities will be duly and validly authorized and issued and will be fully paid beneficial interests in the Designated Trust and will conform in all material respects to the description thereof contained in the Prospectus; the issuance of the Common Securities of the Designated Trust will not be subject to preemptive or other similar rights; the Common Securities of the Designated Trust will not be subject to preemptive or other similar rights; and at each Time of Delivery (as defined in Section 4 hereof), all of the issued and outstanding Common Securities of the Designated Trust will be directly owned by the Company free and clear of any security interest, mortgage, pledge, lien, encumbrance, claim or equity; (l) The Designated Guarantee, the Agreement as to Expenses and Liabilities between the Company and the Designated Trust in the form set forth in Exhibit D to the Trust Agreement (the "Designated Expense Agreement") (all such Designated Expense Agreements together, the "Expense Agreements'), the Trust Agreement for the Designated Trust, the Designated Subordinated Debentures and the Subordinated Indenture (the Designated Guarantee, the Designated Expense Agreement, such Trust Agreement, the Designated Subordinated Debentures and the Subordinated Indenture being collectively referred to as the "Company Agreements") have each been duly authorized by the Company and, when executed and delivered by the Company and (i) in the case of the Designated Guarantee, by the Guarantee Trustee (as defined in the Designated Guarantee), (ii) in the case of the Designated Expense Agreement, by the Designated Trust, (iii) in the case of the Trust Agreement, by the Trustees (as defined in the Trust Agreement) and (iv) in the case of the Subordinated Indenture, by the Indenture Trustee, and in the case of the Designated Subordinated Debentures, when authenticated and delivered by the Indenture Trustee, will be duly executed and delivered by the Company (and, in the case of the Designated Subordinated Debentures, duly authenticated and issued) and will constitute at each Time of Delivery valid and legally 6 binding obligations of the Company, enforceable in accordance with their respective terms (and, in the case of the Designated Subordinated Debentures, entitled to the benefits of the Subordinated Indenture), subject, as to enforcement, to bankruptcy, insolvency, reorganization and other laws of general applicability relating to or affecting creditors' rights and to general equity principles; the Trust Agreement, the Subordinated Indenture and the Designated Guarantee have each been duly qualified under the Trust Indenture Act; and the Company Agreements, which will be in substantially the form filed as exhibits to the Registration Statement, will conform in all material respects to the descriptions thereof in the Prospectus as amended or supplemented with respect to the Designated Securities to which they relate; (m) The issue and sale of the Designated Securities and the Common Securities by the Designated Trust, the compliance by the Designated Trust with all of the provisions of this Agreement, any Pricing Agreement and each Over-allotment Option, if any, the Designated Securities, the Designated Expense Agreement and the Trust Agreement and the consummation of the transactions contemplated herein and therein will not conflict with or result in a breach or violation of any of the terms or provisions of, or constitute a default under, any material indenture, mortgage, deed of trust, loan agreement or other agreement or instrument to which such Trust is a party or by which such Trust is bound or to which any of the property or assets of such Trust is subject, nor will such action result in any violation of the provisions of the Certificate of Trust or Trust Agreement of such Trust or any statute or any order, rule or regulation of any court or governmental agency or body having jurisdiction over such Trust or any of its properties; and no consent, approval, authorization, order, registration or qualification of or with any such court or governmental agency or body is required for the issue and sale of the Designated Securities and the Common Securities by such Trust or the consummation by such Trust of the transactions contemplated by this Agreement, the Pricing Agreement or any Over-allotment Option, the Designated Securities, the Designated Expense Agreement or the Trust Agreement, except (i) such as have been, or will have been, prior to each Time of Delivery, obtained under the Act and the Trust Indenture Act and (ii) such consents, approvals, authorizations, registrations or qualifications as may be required under state securities or Blue Sky laws in connection with the purchase and distribution of the Designated Securities by the Underwriters; (n) The issuance by the Company of the Guarantees and the Subordinated Debentures, the compliance by the Company with all of the provisions of this Agreement, any Pricing Agreement, the Guarantees, the Expense Agreements, the Subordinated Debentures, the Trust Agreements and the Subordinated Indenture, and the consummation of the transactions contemplated herein and therein will not conflict with or result in a breach or violation of any of the terms or provisions of, or constitute a default under, any material indenture, mortgage, deed of trust, loan agreement or other agreement or instrument to which the Company or any of its subsidiaries is a party or by which the Company or any of its subsidiaries is bound or to which any of the property or assets of the Company or any of its subsidiaries is subject, nor will such action result in 7 any violation of the provisions of the Articles of Incorporation or By- Laws of the Company or any statute or any order, rule or regulation of any court or governmental agency or body having jurisdiction over the Company or any of its properties or any of its properties; and no consent, approval, authorization, order, registration or qualification of or with any such court or governmental agency or body is required for the issue and sale of the Guarantees or the Subordinated Debentures or the consummation by the Company of the transactions contemplated by this Agreement, any Pricing Agreement, the Guarantees, the Expense Agreements, the Subordinated Debentures, the Trust Agreements or the Subordinated Indenture, except (i) such as have been, or will have been, prior to each Time of Delivery, obtained under the Act or the Trust Indenture Act and (ii) such consents, approvals, authorizations, registrations or qualifications as may be required under state securities or Blue Sky laws in connection with the issuance and sale by the Company of the Guarantees and the Subordinated Debentures; (o) Other than as set forth in the Prospectus, there are no legal or governmental proceedings pending to which the Designated Trust, the Company or any of its subsidiaries is a party or of which any of their properties is the subject, which, if determined adversely to the Designated Trust, the Company or any of its subsidiaries, would individually or in the aggregate have a material adverse effect on the current or future consolidated financial position, stockholders' equity or results of operations of either the Designated Trust or the Company and its subsidiaries taken as a whole; and, to the best of the Designated Trust's and the Company's knowledge, no such proceedings are threatened or contemplated by governmental authorities or threatened by others; (p) None of the Designated Trust, the Company nor any of its subsidiaries, as applicable, is in violation of the Trust Agreement for the Designated Trust, the Certificate of Trust for the Designated Trust, the Articles of Incorporation or By-Laws of the Company, or the charter or by- laws of any of its subsidiaries, or in default in the performance or observance of any obligation, agreement, covenant or condition contained in any indenture, mortgage, deed of trust, loan agreement, lease or other agreement or instrument to which it is a party or by which it or any of its properties may be bound, other than any such violation or default that would not, individually or in the aggregate, have a material adverse effect on or affecting the general affairs, management, financial position, stockholders' equity or results of operations of either the Designated Trust or the Company and its subsidiaries taken as a whole; (q) The Company and its subsidiaries possess such certificates, authorities or permits issued by the appropriate state, federal or foreign regulatory agencies or bodies necessary to conduct the business now operated by them, except where the failure to possess such certificates, authorities or permits, individually or in the aggregate, would not have a material adverse effect on the condition, financial or otherwise, or the earnings or business affairs of the Company and its subsidiaries taken as a whole; and neither the Company nor any of its subsidiaries has received any notice of proceedings relating to the revocation or modification of any such certificate, authority or permit which, individually 8 or in the aggregate, if the subject of an unfavorable decision, ruling or finding, would materially and adversely affect the condition, financial or otherwise, or the earnings or business affairs of the Company and its subsidiaries taken as a whole; (r) The financial statements of the Company and its consolidated subsidiaries included or incorporated by reference in the Registration Statement and Prospectus present fairly in all material respects the consolidated financial position of the Company and its consolidated subsidiaries as of the dates indicated and the consolidated results of their operations for the periods specified; and, except as stated therein, such financial statements have been prepared in conformity with generally accepted accounting principles in the United States applied on a consistent basis; (s) The statements set forth in (i) the Prospectus under the captions "Description of Securities", "Description of Debt Securities", "Description of Preferred Securities", "Description of Preferred Securities Guarantees", "Description of Expense Agreements" and "Relationship among Preferred Securities, Preferred Securities Guarantees and Subordinated Debt Securities Held by Each Trust" and (ii) in the Prospectus as amended or supplemented under the captions "Description of Series __ QUIPS" and "Description of Series __ QUIDS", insofar as they constitute a summary of the terms of the Securities, the Subordinated Debentures, the Guarantees, the Expense Agreements and the Company Agreements (including the Designated Securities, the Designated Subordinated Debentures, the Designated Guarantee and the Designated Expense Agreement) and (x) in the Prospectus under the caption "Plan of Distribution" and (y) in the Prospectus as amended or supplemented under the captions "Underwriting" and "Material United States Federal Income Tax Considerations", insofar as they purport to describe the provisions of the laws and documents referred to therein, in each case are accurate, complete and fair; (t) Neither the Designated Trust nor the Company nor any of its subsidiaries is or, after giving effect to the offering and sale of the Securities, will be, an "investment company" or an entity "controlled" by an "investment company", as such term is defined in the Investment Company Act of 1940, as amended (the "Investment Company Act"); (u) Arthur Andersen LLP, who have certified certain financial statements of the Company and its subsidiaries, are independent public accountants as required by the Act and the rules and regulations of the Commission thereunder; and (v) The Company has reviewed its operations and that of its subsidiaries and any third parties with which the Company and its subsidiaries taken as a whole have a material relationship, to evaluate the extent to which the business or operations of the Company and its subsidiaries taken as a whole will be affected by the Year 2000 Problem. As a result of such review, the Company does not believe that the Year 2000 Problem will have a material adverse effect on the general affairs, management, the current or future consolidated financial position, business prospects, stockholders' equity or results of operations of the Company and its subsidiaries taken as a whole or result in 9 any material loss or interference with the business or operations of the Company and its subsidiaries taken as a whole. The "Year 2000 Problem" as used herein means any significant risk that computer hardware or software used by the Company or any of its subsidiaries in the receipt, transmission, processing, manipulation, storage, retrieval, retransmission or other utilization of data or in the operation of mechanical or electrical systems of any kind will not, in the case of dates or time periods occurring after December 31, 1999, function at least as effectively as in the case of dates or time periods occurring prior to January 1, 2000. 3. Upon the execution of the Pricing Agreement applicable to any Firm Designated Securities and authorization by the Representatives of the release of such Firm Designated Securities, the several Underwriters propose to offer such Firm Designated Securities for sale upon the terms and conditions set forth in the Prospectus as amended or supplemented. The Designated Trust may specify in the Pricing Agreement applicable to any Designated Securities that the Designated Trust thereby grants to the Underwriters the right (an "Over-allotment Option") to purchase at their election up to the number of Optional Designated Securities set forth in such Pricing Agreement, on the terms set forth therein, for the sole purpose of covering over-allotments in the sale of the Firm Designated Securities. Any such election to purchase Optional Designated Securities may be exercised by written notice from the Representatives to the Designated Trust and the Company, given within a period specified in the Pricing Agreement, setting forth the aggregate number of Optional Designated Securities to be purchased and the date on which such Optional Designated Securities are to be delivered, as determined by the Representatives but in no event earlier than the First Time of Delivery (as defined in Section 4 hereof) or, unless the Representatives, the Designated Trust and the Company otherwise agree in writing, earlier than or later than the respective number of business days after the date of such notice set forth in such Pricing Agreement. The Number of Optional Designated Securities to be added to the number of Firm Designated Securities to be purchased by each Underwriter as set forth in Schedule I to the Pricing Agreement applicable to such Designated Securities shall be, in each case, the number of Optional Designated Securities which the Designated Trust and the Company have been advised by the Representatives have been attributed to such Underwriter; provided that, if the Designated Trust and the Company have not been so advised, the number of Optional Designated Securities to be so added shall be, in each case, that proportion of Optional Designated Securities which the number of Firm Designated Securities to be purchased by such Underwriter under such Pricing Agreement bears to the aggregate number of Firm Designated Securities (rounded as the Representatives may determine to the nearest 100 securities). The total number of Designated Securities to be purchased by all the Underwriters pursuant to such Pricing Agreement shall be the aggregate number of Firm Designated Securities set forth in Schedule I to such Pricing Agreement plus the aggregate number of Optional Designated Securities which the Underwriters elect to purchase. 10 As compensation to the Underwriters of the Designated Securities for their commitments hereunder and under the Pricing Agreement, and in view of the fact that the proceeds of the sale of the Designated Securities will be used by the Designated Trust to purchase the Designated Subordinated Debentures of the Company, the Company agrees to pay at each Time of Delivery to the Representatives, for the accounts of the several Underwriters, the amount set forth in the Pricing Agreement per Designated Security for the Designated Securities to be delivered at each Time of Delivery. 4. Certificates for the Firm Designated Securities and the Optional Designated Securities to be purchased by each Underwriter pursuant to the Pricing Agreement relating thereto, in the form specified in the Trust Agreement, and in such authorized denominations and registered in such names as the Representatives may request upon at least forty-eight hours' prior notice to the Designated Trust and the Company, shall be delivered by or on behalf of the Designated Trust to the Representatives for the account of such Underwriter, against payment by such Underwriter or on its behalf of the purchase price therefor by wire transfer of Federal (same-day) funds to an account designated by the Designated Trust, (i) with respect to the Firm Designated Securities, all in the manner and at the place and time and date specified in such Pricing Agreement or at such other place and time and date as the Representatives, the Designated Trust and the Company may agree upon in writing, such time and place being herein called the "First Time of Delivery" and (ii) with respect to the Optional Designated Securities, if any, in the manner and at the time and date specified by the Representatives in the written notice given by the Representatives of the Underwriters' election to purchase such Optional Designated Securities, or at such other time and date as the Representatives, the Designated Trust and the Company may agree upon in writing, such time and date, if not the First Time of Delivery, being herein called the "Second Time of Delivery." Each such time and date for delivery is herein called a "Time of Delivery". 5. The Designated Trust and the Company, jointly and severally, agree with each of the Underwriters of any Designated Securities: (a) To prepare the Prospectus as amended or supplemented in relation to the applicable Designated Securities in a form approved by the Representatives and to file such Prospectus pursuant to Rule 424(b) under the Act not later than the Commission's close of business on the second business day following the execution and delivery of the Pricing Agreement relating to the applicable Designated Securities or, if applicable, such earlier time as may be required by Rule 424(b); to make no further amendment or any supplement to the Registration Statement or Prospectus as amended or supplemented after the date of the Pricing Agreement relating to such Securities and prior to the last Time of Delivery for such Securities which shall be disapproved by the Representatives for such Securities promptly after reasonable notice thereof; to advise the Representatives promptly of any such amendment or supplement after such Time of Delivery and furnish the Representatives with copies thereof; to file promptly all reports and any definitive proxy or information statements required to be filed by the Company with the Commission pursuant to Section 13(a), 13(c), 14 or 15(d) of the Exchange Act for so 11 long as the delivery of a prospectus is required in connection with the offering or sale of such Securities, and during such same period to advise the Representatives, promptly after it receives notice thereof, of the time when any amendment to the Registration Statement has been filed or becomes effective or any supplement to the Prospectus or any amended Prospectus has been filed with the Commission, of the issuance by the Commission of any stop order or of any order preventing or suspending the use of any prospectus relating to the Securities, of the suspension of the qualification of such Securities for offering or sale in any jurisdiction, of the initiation or threatening of any proceeding for any such purpose, or of any request by the Commission for the amending or supplementing of the Registration Statement or Prospectus or for additional information; and, in the event of the issuance of any such stop order or of any such order preventing or suspending the use of any prospectus relating to the Securities or suspending any such qualification, to promptly use its commercially reasonable efforts to obtain the withdrawal of such order; (b) Promptly from time to time to take such action as the Representatives may reasonably request to qualify such Designated Securities or the Designated Subordinated Debentures for offering and sale under the securities laws of such jurisdictions as the Representatives may request and to comply with such laws so as to permit the continuance of sales and dealings therein in such jurisdictions for as long as may be necessary to complete the distribution of such Designated Securities, provided that in connection therewith neither the Designated Trust nor the Company shall be required to (i) qualify as a foreign corporation, (ii) file a general consent to service of process in any jurisdiction or (iii) comply with any other requirement in connection with such qualification deemed by the Company to be unduly burdensome; (c) Prior to 10:00 a.m., New York City time, on the New York Business Day next succeeding the date of the Pricing Agreement for such Designated Securities or such later time or date as agreed to by the Designated Trust, the Company and the Representatives, and from time to time, to furnish the Underwriters with copies of the Prospectus in New York City as amended or supplemented in such quantities as the Representatives may reasonably request, and, if the delivery of a prospectus is required at any time in connection with the offering or sale of the Designated Securities or the Designated Subordinated Debentures and if at such time any event shall have occurred as a result of which the Prospectus as then amended or supplemented would include an untrue statement of a material fact or omit to state any material fact necessary in order to make the statements therein, in the light of the circumstances under which they were made when such Prospectus is delivered, not misleading, or, if for any other reason it shall be necessary during such same period to amend or supplement the Prospectus or to file under the Exchange Act any document incorporated by reference in the Prospectus in order to comply with the Act, the Exchange Act or the Trust Indenture Act, to notify the Representatives and upon their request to file such document and to prepare and furnish without charge to each Underwriter and to any dealer in securities as many copies as the Representatives may from time to time reasonably request of an amended Prospectus or a 12 supplement to the Prospectus which will correct such statement or omission or effect such compliance; (d) In the case of the Company, to make generally available to its securityholders as soon as practicable, but in any event not later than eighteen months after the effective date of the Registration Statement (as defined in Rule 158(c) under the Act), an earnings statement of the Company and its subsidiaries (which need not be audited) complying with Section 11(a) of the Act and the rules and regulations of the Commission thereunder (including, at the option of the Company, Rule 158); (e) During the period beginning from the date of the Pricing Agreement for such Designated Securities and continuing to and including the later of (i) the termination of trading restrictions for such Designated Securities, as notified to the Designated Trust and the Company by the Representatives and (ii) 30 days after the last Time of Delivery for such Designated Securities, not to offer, sell, contract to sell or otherwise dispose of any Securities, any other beneficial interests in the assets of any Trust, or any preferred securities or any other securities of any Trust or the Company, as the case may be, that are substantially similar to such Designated Securities (including any guarantee of such securities) or any securities that are convertible into or exchangeable for, or that represent the right to receive, Securities, preferred securities or any such substantially similar securities of any Trust or the Company, or any debt securities of the Company (other than the Designated Subordinated Debentures) which mature more than one year after such Time of Delivery and which are substantially similar to such Designated Securities, without the prior written consent of the Representatives; (f) In the case of the Company, to issue the Designated Guarantee concurrently with the issue and sale of the Designated Securities as contemplated herein or in the Pricing Agreement; (g) To use its best efforts to list within 30 days following the First Time of Delivery, subject to notice of issuance, the Designated Securities on the New York Stock Exchange and, if the Company elects to dissolve the Designated Trust and to distribute the Designated Subordinated Debentures to the holders of the Designated Securities in liquidation of the Designated Trust, to use its best efforts to list the Designated Subordinated Debentures on the New York Stock Exchange prior to such distribution; and (h) If the Designated Trust and the Company elect to rely upon Rule 462(b), the Designated Trust and the Company shall file a Rule 462(b) Registration Statement with the Commission in compliance with Rule 462(b) by 10:00 P.M., Washington, D.C. time, on the date of this Agreement, and the Designated Trust and the Company shall at the time of filing either pay to the Commission the filing fee for the Rule 462(b) Registration Statement or give irrevocable instructions for the payment of such fee pursuant to Rule 111(b) under the Act. 13 6. The Company covenants and agrees with the several Underwriters that the Company will pay or cause to be paid the following: (i) the fees, disbursements and expenses of the Company's counsel and accountants in connection with the registration of the Securities, the Guarantees and the Subordinated Debentures under the Act and all other expenses in connection with the preparation, printing and filing of the Registration Statement, any Preliminary Prospectus and the Prospectus and amendments and supplements thereto and the mailing and delivering of copies thereof to the Underwriters and dealers; (ii) the cost of printing or producing any Agreement among Underwriters, this Agreement, any Pricing Agreement, any Company Agreement (including any amendment or supplement to the Subordinated Indenture), the Securities, any Blue Sky and Legal Investment Memoranda, closing documents (including any compilations thereof) and any other documents in connection with the offering, purchase, sale and delivery of the Securities; (iii) all expenses in connection with the qualification of the Securities for offering and sale under state securities laws as provided in Section 5(b) hereof, including the reasonable fees and disbursements of counsel for the Underwriters in connection with such qualification and in connection with the Blue Sky and Legal Investment Surveys; (iv) any fees charged by securities rating services for rating the Securities and the Subordinated Debentures; (v) any filing fees incident to, and the reasonable fees and disbursements of counsel for the Underwriters in connection with, any required review by the National Association of Securities Dealers, Inc. of the terms of the sale of the Securities and the issuance of the Guarantees and the Subordinated Debentures; (vi) the cost of preparing the Securities and the Subordinated Debentures; (vii) the fees and expenses of any Indenture Trustee, Guarantee Trustee or other trustee (including any trustee under any Trust Agreement), and any agent of any such trustee and the reasonable fees and disbursements of counsel for any such trustee in connection with any Trust Agreement, the Subordinated Indenture, any Guarantee, the Securities and the Subordinated Debentures; (viii) the cost of qualifying the Securities and the Subordinated Debentures with The Depository Trust Company; (ix) any fees and expenses in connection with listing the Securities and the Subordinated Debentures and the cost of registering the Securities under Section 12 of the Exchange Act; and (x) all other costs and expenses incident to the performance of its obligations hereunder and under any Over-allotment Options which are not otherwise specifically provided for in this Section. It is understood, however, that, except as provided in this Section, and Sections 8 and 11 hereof, the Underwriters will pay all of their own costs and expenses, including the fees of their counsel, transfer taxes on resale of any of the Securities by them, and any advertising expenses connected with any offers they may make. 7. The obligations of the Underwriters of any Designated Securities under the Pricing Agreement relating to such Designated Securities shall be subject, in the discretion of the Representatives, to the condition that all representations and warranties and other statements of the Designated Trust and the Company in or incorporated by reference in the Pricing Agreement relating to such Designated Securities are, at and as of each Time of Delivery for such Designated Securities, true and correct, the condition that the Designated Trust and the Company shall have performed all of their respective obligations hereunder theretofore to be performed, and the following additional conditions: 14 (a) The Prospectus as amended or supplemented in relation to the applicable Designated Securities shall have been filed with the Commission pursuant to Rule 424(b) within the applicable time period prescribed for such filing by the rules and regulations under the Act and in accordance with Section 5(a) hereof; if the Designated Trust and the Company have elected to rely upon Rule 462(b), the Rule 462(b) Registration Statement shall have become effective by 10:00 P.M., Washington, D.C. time, on the date of this Agreement; no stop order suspending the effectiveness of the Registration Statement or any part thereof shall have been issued and no proceeding for that purpose shall have been initiated or threatened by the Commission; and all requests for additional information on the part of the Commission shall have been complied with to the Representatives' reasonable satisfaction; (b) Counsel for the Underwriters shall have furnished to the Representatives such written opinion or opinions, dated each Time of Delivery for such Designated Securities, with respect to the Registration Statement and the Prospectus as amended or supplemented, as well as such other related matters as the Representatives may reasonably request, and such counsel shall have received such papers and information as they may reasonably request to enable them to pass upon such matters; (c) Counsel for the Company and the Designated Trust satisfactory to the Representatives shall have furnished to the Representatives their written opinion or opinions, dated each Time of Delivery for such Designated Securities, in form and substance satisfactory to the Representatives, (i) to the effect set forth in Annex III hereto and (ii) to the effect that (i) The Registration Statement and the Prospectus as amended or supplemented (in each case, excluding the documents incorporated by reference therein) comply as to form in all material respects with the requirements for registration statements on Form S-3 under the Act, and the requirements under the Trust Indenture Act and the rules and regulations of the Commission thereunder; it being understood, however, that such counsel expresses no opinion with respect to the financial statements, schedules or other financial data included or incorporated by reference in, or omitted from, the Registration Statement or the Prospectus as amended or supplemented or with respect to the Form T-1's. In passing upon the compliance as to form of the Registration Statement and the Prospectus as amended or supplemented (in each case, excluding the documents incorporated by reference therein), such counsel has assumed that the statements made and incorporated by reference therein are correct and complete; and (ii) Such counsel has participated in telephone conferences with officers and other representatives of the Company, and representatives of the Underwriters, at which the contents of the Registration Statement and the Prospectus as amended or supplemented and related matters were discussed and, although such counsel is not passing upon, and do not assume any responsibility for, the accuracy, completeness or fairness of the statements contained or incorporated by reference in the Registration Statement and the Prospectus as amended or supplemented and has not made any independent check or verification thereof, during the course of such participation, no facts came to such counsel's attention that caused them to believe that the Registration Statement, at the time it became effective, contained an untrue statement of a material fact or omitted to state a material fact required to be stated therein or necessary to make the statements therein not misleading, or that the Prospectus as amended or supplemented (including the documents incorporated by reference), as of its date or as of the date thereof, contained or contains an untrue statement of a material fact or omitted or omits to state a material fact necessary to make the statements therein, in light of the circumstances under which they were made, not misleading; it being understood that such counsel expresses no belief with respect to the financial statements or other financial data included or incorporated by reference in, or omitted from, the Registration Statement or the Prospectus as amended or supplemented or with respect to the Form T-1's. (d) Special Delaware counsel to the Designated Trust and the Company satisfactory to the Representatives shall have furnished to the Representatives, the Company and the Designated Trust their written opinion, dated the respective Time of Delivery, in form and substance satisfactory to the Representatives, to the effect that (i) The Designated Trust has been duly created and is validly existing in good standing as a business trust under the Delaware Business Trust Act, and all filings required under the laws of the State of Delaware with respect to the creation and valid existence of the Designated Trust as a business trust have been made; (ii) Under the Delaware Business Trust Act and the Trust Agreement, the Designated Trust has the trust power and authority to own property and conduct its business, all as described in the Prospectus as amended or supplemented; (iii) The Trust Agreement constitutes a valid and binding obligation of the Company and the Trustees, and is enforceable against the Company and the Trustees, in accordance with its terms, subject, as to enforcement, to bankruptcy, insolvency, receivership, liquidation, fraudulent conveyance, fraudulent transfer, reorganization, moratorium and similar laws of general applicability relating to or 15 affecting creditors' rights, to general equity principles, including applicable law relating to fiduciary duties (regardless of whether considered and applied in a proceeding in equity or at law), and to the effect of applicable public policy on the enforceability of provisions relating to indemnification or contribution; (iv) Under the Delaware Business Trust Act and the Trust Agreement, the Designated Trust has the requisite trust power and authority to (a) execute, deliver and perform its obligations under this Agreement and the Pricing Agreement and (b) issue and perform its obligations under the Designated Securities and the Common Securities of the Designated Trust; (v) Under the Delaware Business Trust Act and the Trust Agreement, the execution and delivery by the Designated Trust of this Agreement and the Pricing Agreement, and the performance by the Designated Trust of its obligations hereunder and thereunder, have been duly authorized by the requisite trust action on the part of the Designated Trust; (vi) The Designated Securities have been duly authorized by the Trust Agreement and are duly and validly issued and, subject to the qualifications set forth therein, fully paid and non-assessable beneficial interests in the Designated Trust and are entitled to the benefits provided by the Trust Agreement; the holders of the Designated Securities, as beneficial owners of the Designated Trust, will be entitled to the same limitation of personal liability extended to stockholders of private corporations for profit organized under the General Corporation Law of the State of Delaware; provided that such counsel may note that the holders of the Designated Securities may be obligated, pursuant to the Trust Agreement, to (a) provide indemnity and/or security in connection with and pay taxes or governmental charges arising from transfers or exchanges of certificates evidencing the Designated Securities and the issuance of replacement certificates and (b) provide security and indemnity in connection with requests of or directions to the Property Trustee (as defined in the Trust Agreement) to exercise its rights and remedies under the Trust Agreement; (vii) The Common Securities of the Designated Trust have been duly authorized by the Trust Agreement and are validly issued and represent beneficial interests in the Designated Trust; (viii) Under the Delaware Business Trust Act and the Trust Agreement, the issuance of the Designated Securities and the Common Securities of the Designated Trust is not subject to preemptive rights; (ix) The issuance and sale by the Designated Trust of Designated Securities and the Common Securities of the Designated Trust, the execution, delivery and performance by the Designated Trust of this Agreement and the Pricing Agreement, the consummation by the Designated Trust of the transactions 16 contemplated hereby and thereby and compliance by the Designated Trust with its obligations hereunder and thereunder will not violate (a) any of the provisions of the Certificate of Trust of the Designated Trust or the Trust Agreement, or (b) and applicable Delaware law or administrative regulation; (x) Assuming that the Designated Trust derives no income from or connected with sources within the State of Delaware and has no assets, activities (other than maintaining the Delaware Trustee (as defined in the Trust Agreement) and the filing of documents with the Secretary of State of the State of Delaware) or employees in the State of Delaware, no authorization, approval, consent or order of any Delaware court or governmental authority or agency is required to be obtained by the Designated Trust solely in connection with the issuance and sale of the Designated Securities and the Common Securities of the Designated Trust. (In rendering the opinion expressed in this paragraph (x), such counsel need express no opinion concerning the securities laws of the State of Delaware); and (xi) Assuming that the Designated Trust derives no income from or connected with sources within the State of Delaware and has no assets, activities (other than maintaining the Delaware Trustee and the filing of documents with the Secretary of State of the State of Delaware) or employees in the State of Delaware and assuming that the Designated Trust is treated as a grantor trust for Federal income tax purposes, the holders of the Designated Securities (other than those holders who reside or are domiciled in the State of Delaware) will have no liability for income taxes imposed by the State of Delaware solely as a result of their participation in the Designated Trust, and the Designated Trust will not be liable for any income tax imposed by the State of Delaware. (e) Tax counsel for the Designated Trust and the Company satisfactory to the Representatives shall have furnished to the Representatives their written opinion, dated the respective Time of Delivery, in form and substance satisfactory to the Representatives, to the effect that such firm confirms its opinion set forth in the Prospectus as amended or supplemented under the caption "Material United States Federal Income Tax Considerations"; (f) On the date of the Pricing Agreement for such Designated Securities at a time prior to the execution of the Pricing Agreement with respect to such Designated Securities and at each Time of Delivery for such Designated Securities, the independent accountants of the Company who have certified the financial statements of the Company and its subsidiaries included or incorporated by reference in the Registration Statement shall have furnished to the Representatives a letter, dated the effective date of the Registration Statement or the date of the most recent report filed with the Commission containing financial statements and incorporated by reference in the Registration Statement, if the date of such report is later than such effective date, and a letter dated such Time of Delivery, respectively, to the effect set forth in Annex II hereto, and with 17 respect to such letter dated such Time of Delivery, as to such other matters as the Representatives may reasonably request and in form and substance satisfactory to the Representatives; (g) (i) Neither the Designated Trust nor the Company and its subsidiaries (other than the Designated Trust) taken as a whole shall have sustained since the date of the latest audited financial statements included or incorporated by reference in the Prospectus as amended prior to the date of the Pricing Agreement relating to the Designated Securities any loss or interference with its business from fire, explosion, flood or other calamity, whether or not covered by insurance, or from any labor dispute or court or governmental action, order or decree, otherwise than as set forth or contemplated in the Prospectus as amended or supplemented prior to the date of the Pricing Agreement relating to the Designated Securities, and (ii) since the respective dates as of which information is given in the Prospectus as amended prior to the date of the Pricing Agreement relating to the Designated Securities there shall not have been any change in the capital stock or long-term debt of the Designated Trust or the Company and its subsidiaries (other than the Designated Trust) taken as a whole or any change, or any development involving a prospective change, in or affecting the general affairs, management, financial position, stockholders' equity or results of operations of the Designated Trust or the Company and its subsidiaries (other than the Designated Trust) taken as a whole, otherwise than as set forth or contemplated in the Prospectus as amended or supplemented prior to the date of the Pricing Agreement relating to the Designated Securities, the effect of which, in any such case described in clause (i) or (ii), is in the judgment of the Representatives so material and adverse as to make it impracticable or inadvisable to proceed with the public offering or the delivery of the Firm Designated Securities or Optional Designated Securities or both on the terms and in the manner contemplated in the Prospectus as first amended or supplemented relating to the Designated Securities; (h) On or after the date of the Pricing Agreement relating to the Designated Securities (i) no downgrading shall have occurred in the rating accorded the Company's debt securities or preferred stock by any "nationally recognized statistical rating organization", as that term is defined by the Commission for purposes of Rule 436(g)(2) under the Act, and (ii) no such organization shall have publicly announced that it has under surveillance or review, with possible negative implications, its rating of any of the Company's debt securities or preferred stock; (i) On or after the date of the Pricing Agreement relating to the Designated Securities there shall not have occurred any of the following: (i) a suspension or material limitation in trading in securities generally on the New York Stock Exchange; (ii) a suspension or material limitation in trading in the Company's securities on the New York Stock Exchange; (iii) a general moratorium on commercial banking activities declared by Federal or New York State or State of California authorities; or (iv) the outbreak or escalation of hostilities involving the United States or the declaration by the United States 18 of a national emergency or war, if the effect of any such event specified in this clause (iv) in the judgment of the Representatives makes it impracticable or inadvisable to proceed with the public offering or the delivery of the Firm Designated Securities or Optional Designated Securities or both on the terms and in the manner contemplated in the Prospectus as first amended or supplemented relating to the Designated Securities; (j) The Company shall have complied with the provisions of Section 5(c) hereof with respect to the furnishing of prospectuses on the New York Business Day next succeeding the date of this Agreement or such later date as agreed to among the Designated Trust, the Company and the Representatives; and (k) The Designated Trust and the Company shall have furnished or caused to be furnished to the Representatives at each Time of Delivery for the Designated Securities certificates of officers of the Designated Trust and the Company satisfactory to the Representatives as to the accuracy of the representations and warranties of the Designated Trust and the Company herein at and as of such Time of Delivery, as to the performance by the Designated Trust and the Company of all of its obligations hereunder to be performed at or prior to such Time of Delivery, as to the matters set forth in subsections (a) and (g) of this Section and as to such other matters as the Representatives may reasonably request. 8. (a) The Designated Trust and the Company, jointly and severally, will indemnify and hold harmless each Underwriter against any losses, claims, damages or liabilities, joint or several, to which such Underwriter may become subject, under the Act or otherwise, insofar as such losses, claims, damages or liabilities (or actions in respect thereof) arise out of or are based upon an untrue statement or alleged untrue statement of a material fact contained in any Preliminary Prospectus, any preliminary prospectus supplement, the Registration Statement, the Prospectus as amended or supplemented and any other prospectus relating to the Designated Securities, or any amendment or supplement thereto, or arise out of or are based upon the omission or alleged omission to state therein a material fact required to be stated therein or necessary to make the statements therein not misleading, and will reimburse each Underwriter for any legal or other expenses reasonably incurred by such Underwriter in connection with investigating or defending any such action or claim as such expenses are incurred; provided, however, that neither the Designated Trust nor the Company shall be liable in any such case to the extent that any such loss, claim, damage or liability arises out of or is based upon an untrue statement or alleged untrue statement or omission or alleged omission made in any Preliminary Prospectus, any preliminary prospectus supplement, the Registration Statement, the Prospectus as amended or supplemented and any other prospectus relating to the Designated Securities, or any such amendment or supplement, in reliance upon and in conformity with written information furnished to the Designated Trust and the Company by any Underwriter of Designated Securities through the Representatives expressly for use in the Prospectus as amended or supplemented relating to such Securities. 19 (b) Each Underwriter will indemnify and hold harmless the Designated Trust and the Company against any losses, claims, damages or liabilities to which the Designated Trust may become subject, under the Act or otherwise, insofar as such losses, claims, damages or liabilities (or actions in respect thereof) arise out of or are based upon an untrue statement or alleged untrue statement of a material fact contained in any Preliminary Prospectus, any preliminary prospectus supplement, the Registration Statement, the Prospectus as amended or supplemented and any other prospectus relating to the Designated Securities, or any amendment or supplement thereto, or arise out of or are based upon the omission or alleged omission to state therein a material fact required to be stated therein or necessary to make the statements therein not misleading, in each case to the extent, but only to the extent, that such untrue statement or alleged untrue statement or omission or alleged omission was made in any Preliminary Prospectus, any preliminary prospectus supplement, the Registration Statement, the Prospectus as amended or supplemented and any other prospectus relating to the Designated Securities, or any such amendment or supplement, in reliance upon and in conformity with written information furnished to the Designated Trust and the Company by such Underwriter through the Representatives expressly for use therein; and will reimburse the Designated Trust and the Company for any legal or other expenses reasonably incurred by the Company or the Designated Trust in connection with investigating or defending any such action or claim as such expenses are incurred. (c) Promptly after receipt by an indemnified party under subsection (a) or (b) above of notice of the commencement of any action, such indemnified party shall, if a claim in respect thereof is to be made against the indemnifying party under such subsection, notify the indemnifying party in writing of the commencement thereof; but the omission so to notify the indemnifying party shall not relieve it from any liability which it may have to any indemnified party otherwise than under such subsection. In case any such action shall be brought against any indemnified party and it shall notify the indemnifying party of the commencement thereof, the indemnifying party shall be entitled to participate therein and, to the extent that it shall wish, jointly with any other indemnifying party similarly notified, to assume the defense thereof, with counsel satisfactory to such indemnified party (who shall not, except with the consent of the indemnified party, be counsel to the indemnifying party), and, after notice from the indemnifying party to such indemnified party of its election so to assume the defense thereof, the indemnifying party shall not be liable to such indemnified party under such subsection for any legal expenses of other counsel or any other expenses, in each case subsequently incurred by such indemnified party, in connection with the defense thereof other than reasonable costs of investigation. No indemnifying party shall, without the written consent of the indemnified party, effect the settlement or compromise of, or consent to the entry of any judgment with respect to, any pending or threatened action or claim in respect of which indemnification or contribution may be sought hereunder (whether or not the indemnified party is an actual or potential party to such action or claim) unless such settlement, compromise or judgment (i) includes an unconditional release of the indemnified party from all liability arising out of such action or claim and (ii) does not include a statement as to or an admission of fault, culpability or a failure to act, by or on behalf of any indemnified party. 20 (d) If the indemnification provided for in this Section 8 is unavailable to or insufficient to hold harmless an indemnified party under subsection (a) or (b) above in respect of any losses, claims, damages or liabilities (or actions in respect thereof) referred to therein, then each indemnifying party shall contribute to the amount paid or payable by such indemnified party as a result of such losses, claims, damages or liabilities (or actions in respect thereof) in such proportion as is appropriate to reflect the relative benefits received by the Designated Trust and the Company on the one hand and the Underwriters of the Designated Securities on the other from the offering of the Designated Securities to which such loss, claim, damage or liability (or action in respect thereof) relates. If, however, the allocation provided by the immediately preceding sentence is not permitted by applicable law or if the indemnified party failed to give the notice required under subsection (c) above, then each indemnifying party shall contribute to such amount paid or payable by such indemnified party in such proportion as is appropriate to reflect not only such relative benefits but also the relative fault of the Designated Trust and the Company on the one hand and the Underwriters of the Designated Securities on the other in connection with the statements or omissions which resulted in such losses, claims, damages or liabilities (or actions in respect thereof), as well as any other relevant equitable considerations. The relative benefits received by the Designated Trust and the Company on the one hand and such Underwriters on the other shall be deemed to be in the same proportion as the total net proceeds from such offering (before deducting expenses) received by the Designated Trust and the Company bear to the total underwriting discounts and commissions received by such Underwriters. The relative fault shall be determined by reference to, among other things, whether the untrue or alleged untrue statement of a material fact or the omission or alleged omission to state a material fact relates to information supplied by the Designated Trust and the Company on the one hand or such Underwriters on the other and the parties' relative intent, knowledge, access to information and opportunity to correct or prevent such statement or omission. The Designated Trust, the Company and the Underwriters agree that it would not be just and equitable if contribution pursuant to this subsection (d) were determined by pro rata allocation (even if the Underwriters were treated as one entity for such purpose) or by any other method of allocation which does not take account of the equitable considerations referred to above in this subsection (d). The amount paid or payable by an indemnified party as a result of the losses, claims, damages or liabilities (or actions in respect thereof) referred to above in this subsection (d) shall be deemed to include any legal or other expenses reasonably incurred by such indemnified party in connection with investigating or defending any such action or claim. Notwithstanding the provisions of this subsection (d), no Underwriter shall be required to contribute any amount in excess of the amount by which the total price at which the applicable Designated Securities underwritten by it and distributed to the public were offered to the public exceeds the amount of any damages which such Underwriter has otherwise been required to pay by reason of such untrue or alleged untrue statement or omission or alleged omission. No person guilty of fraudulent misrepresentation (within the meaning of Section 11(f) of the Act) shall be entitled to contribution from any person who was not guilty of such fraudulent misrepresentation. The obligations of the Underwriters of Designated Securities in this subsection (d) to contribute are several in proportion to their respective underwriting obligations with respect to such Securities and not joint. 21 (e) The obligations of the Designated Trust and the Company under this Section 8 shall be in addition to any liability which the Designated Trust or the Company may otherwise have and shall extend, upon the same terms and conditions, to each person, if any, who controls any Underwriter within the meaning of the Act; and the obligations of the Underwriters under this Section 8 shall be in addition to any liability which the respective Underwriters may otherwise have and shall extend, upon the same terms and conditions, to each officer and director of the Designated Trust or the Company and to each person, if any, who controls the Designated Trust or the Company within the meaning of the Act. 9. (a) If any Underwriter shall default in its obligation to purchase the Firm Designated Securities or Optional Designated Securities which it has agreed to purchase under the Pricing Agreement relating to such Designated Securities, the Representatives may in their discretion arrange for themselves or another party or other parties to purchase such Designated Securities on the terms contained herein. If within thirty-six hours after such default by any Underwriter the Representatives do not arrange for the purchase of such Firm Designated Securities or Optional Designated Securities, as the case may be, then the Designated Trust and the Company shall be entitled to a further period of thirty-six hours within which to procure another party or other parties satisfactory to the Representatives to purchase such Designated Securities on such terms. In the event that, within the respective prescribed period, the Representatives notify the Designated Trust and the Company that they have so arranged for the purchase of such Designated Securities, or the Designated Trust and the Company notify the Representatives that it has so arranged for the purchase of such Designated Securities, the Representatives or the Designated Trust and the Company shall have the right to postpone a Time of Delivery for such Designated Securities for a period of not more than seven days, in order to effect whatever changes may thereby be made necessary in the Registration Statement or the Prospectus as amended or supplemented, or in any other documents or arrangements, and the Designated Trust and the Company agree to file promptly any amendments or supplements to the Registration Statement or the Prospectus which in the opinion of the Representatives may thereby be made necessary. The term "Underwriter" as used in this Agreement shall include any person substituted under this Section with like effect as if such person had originally been a party to the Pricing Agreement with respect to such Designated Securities. (b) If, after giving effect to any arrangements for the purchase of the Firm Designated Securities or Optional Designated Securities, as the case may be, of a defaulting Underwriter or Underwriters by the Representatives and the Designated Trust and the Company as provided in subsection (a) above, the aggregate number of such Designated Securities which remains unpurchased does not exceed one-eleventh of the aggregate number of the Firm Designated Securities or Optional Designated Securities, as the case may be, to be purchased at the respective Time of Delivery, then the Designated Trust shall have the right to require each non-defaulting Underwriter to purchase the number of Firm Designated Securities or Optional Designated Securities, as the case may be, which such Underwriter agreed to purchase under the Pricing Agreement relating to such Designated Securities and, in addition, to require each non- defaulting Underwriter to purchase its pro rata share (based on the number of Firm Designated Securities or Optional Designated Securities, as the case may be, which such 22 Underwriter agreed to purchase under such Pricing Agreement) of the Firm Designated Securities or Optional Designated Securities, as the case may be, of such defaulting Underwriter or Underwriters for which such arrangements have not been made; but nothing herein shall relieve a defaulting Underwriter from liability for its default. (c) If, after giving effect to any arrangements for the purchase of the Firm Designated Securities or Optional Designated Securities, as the case may be, of a defaulting Underwriter or Underwriters by the Representatives and the Designated Trust and the Company as provided in subsection (a) above, the aggregate number of Firm Designated Securities or Optional Designated Securities, as the case may be, which remains unpurchased exceeds one-eleventh of the aggregate number of the Firm Designated Securities or Optional Designated Securities, as the case may be, to be purchased at the respective Time of Delivery, as referred to in subsection (b) above, or if the Designated Trust and the Company shall not exercise the right described in subsection (b) above to require non-defaulting Underwriters to purchase Firm Designated Securities or Optional Designated Securities, as the case may be, of a defaulting Underwriter or Underwriters, then the Pricing Agreement relating to such Firm Designated Securities or the Over-allotment Option relating to such Optional designated Securities, as the case may be, shall thereupon terminate, without liability on the part of any non-defaulting Underwriter or the Designated Trust or the Company, except for the expenses to be borne by the Designated Trust and the Company and the Underwriters as provided in Section 6 hereof and the indemnity and contribution agreements in Section 8 hereof; but nothing herein shall relieve a defaulting Underwriter from liability for its default. 10. The respective indemnities, agreements, representations, warranties and other statements of the Designated Trust and the Company and the several Underwriters, as set forth in this Agreement or made by or on behalf of them, respectively, pursuant to this Agreement, shall remain in full force and effect, regardless of any investigation (or any statement as to the results thereof) made by or on behalf of any Underwriter or any controlling person of any Underwriter, or the Designated Trust or the Company, or any officer or director or controlling person of the Designated Trust or the Company, and shall survive delivery of and payment for the Securities. 11. If any Pricing Agreement or Over-allotment Option shall be terminated pursuant to Section 9 hereof, neither the Designated Trust nor the Company shall then be under any liability to any Underwriter with respect to the Firm Designated Securities or Optional Designated Securities with respect to which such Pricing Agreement shall have been terminated except as provided in Sections 6 and 8 hereof; but, if for any other reason Designated Securities are not delivered by or on behalf of the Designated Trust or the Company as provided herein, the Company will reimburse the Underwriters through the Representatives for all out-of-pocket expenses approved in writing by the Representatives, including fees and disbursements of counsel, reasonably incurred by the Underwriters in making preparations for the purchase, sale and delivery of such Designated Securities, but the Designated Trust and the Company shall then be under no further liability to any Underwriter with respect to such Designated Securities except as provided in Sections 6 and 8 hereof. 23 12. In all dealings hereunder, the Representatives of the Underwriters of Designated Securities shall act on behalf of each of such Underwriters, and the parties hereto shall be entitled to act and rely upon any statement, request, notice or agreement on behalf of any Underwriter made or given by such Representatives jointly or by such of the Representatives, if any, as may be designated for such purpose in the Pricing Agreement. All statements, requests, notices and agreements hereunder shall be in writing, and if to the Underwriters shall be delivered or sent by mail, telex or facsimile transmission to the address of the Representatives as set forth in the Pricing Agreement; and if to the Designated Trust or the Company shall be delivered or sent by mail, telex or facsimile transmission to the address of the Company set forth in the Registration Statement, Attention: Secretary; provided, however, that any notice to an Underwriter pursuant to Section 8(c) hereof shall be delivered or sent by mail, telex or facsimile transmission to such Underwriter at its address set forth in its Underwriters' Questionnaire, or telex constituting such Questionnaire, which address will be supplied to the Designated Trust and the Company by the Representatives upon request. Any such statements, requests, notices or agreements shall take effect upon receipt thereof. 13. This Agreement and each Pricing Agreement shall be binding upon, and inure solely to the benefit of, the Underwriters, each Designated Trust, the Company and, to the extent provided in Sections 8 and 10 hereof, the officers and directors of each Designated Trust, the Company and each person who controls any Designated Trust or the Company or any Underwriter, and their respective heirs, executors, administrators, successors and assigns, and no other person shall acquire or have any right under or by virtue of this Agreement or any such Pricing Agreement. No purchaser of any of the Securities from any Underwriter shall be deemed a successor or assign by reason merely of such purchase. 14. Time shall be of the essence of each Pricing Agreement. As used herein, "business day" shall mean any day when the Commission's office in Washington, D.C. is open for business. 15. This Agreement and each Pricing Agreement shall be governed by and construed in accordance with the laws of the State of New York. 24 16. This Agreement and each Pricing Agreement may be executed by any one or more of the parties hereto and thereto in any number of counterparts, each of which shall be deemed to be an original, but all such respective counterparts shall together constitute one and the same instrument. Very truly yours, EDISON INTERNATIONAL By:...................................... Name: Title: EIX TRUST I By: Edison International, as Depositor By:...................................... Name: Title: EIX TRUST II By: Edison International, as Depositor By:...................................... Name: Title: EIX TRUST III By: Edison International, as Depositor By:...................................... Name: Title: 25 ANNEX I Pricing Agreement ----------------- [Names of Representatives,] As Representatives of the several Underwriters named in Schedule I hereto [Address] ____________, ____ Ladies and Gentlemen: EIX Trust [I] [II] [III], a statutory business trust formed under the laws of the State of Delaware (the "Designated Trust"), and Edison International, a California corporation (the "Company"), propose, subject to the terms and conditions stated herein and in the Underwriting Agreement, dated July [___], 1999 (the "Underwriting Agreement"), to issue and sell to the Underwriters named in Schedule I hereto (the "Underwriters") the Securities specified in Schedule II hereto (the "Designated Securities" consisting of Firm Designated Securities and any Optional Designated Securities the Underwriters may elect to purchase). The principal asset of the Designated Trust consists of debt securities of the Company ("Subordinated Debentures"), as specified in Schedule II to this Agreement. The Designated Securities will be guaranteed by the Company to the extent set forth in this Agreement with respect to such Designated Securities (the "Guarantee"). Each of the provisions of the Underwriting Agreement is incorporated herein by reference in its entirety, and shall be deemed to be a part of this Agreement to the same extent as if such provisions had been set forth in full herein; and each of the representations and warranties set forth therein shall be deemed to have been made at and as of the date of this Pricing Agreement, except that each representation and warranty which refers to the Prospectus in Section 2 of the Underwriting Agreement shall be deemed to be a representation or warranty as of the date of the Underwriting Agreement in relation to the Prospectus (as therein defined), and also a representation and warranty as of the date of this Pricing Agreement in relation to the Prospectus as amended or supplemented relating to the Designated Securities which are the subject of this Pricing Agreement. Each reference to the Representatives herein and in the provisions of the Underwriting Agreement so incorporated by reference shall be deemed to refer to you. Unless otherwise defined herein, terms defined in the Underwriting Agreement are used herein as therein defined. The Representatives designated to act on behalf of the Representatives and on behalf of each of the Underwriters of the Designated Securities pursuant to Section 12 of the Underwriting Agreement and the address of the Representatives referred to in such Section 12 are set forth at the end of Schedule II hereto. An amendment to the Registration Statement, or a supplement to the Prospectus, as the case may be, relating to the Designated Securities, in the form heretofore delivered to you is now proposed to be filed with the Commission. 1 Subject to the terms and conditions set forth herein and in the Underwriting Agreement incorporated herein by reference, (a) the Designated Trust agrees to issue and sell to each of the Underwriters, and each of the Underwriters agrees, severally and not jointly, to purchase from the Designated Trust, at the time and place and at the purchase price to the Underwriters set forth in Schedule II hereto, the number of Firm Designated Securities set forth opposite the name of such Underwriter in Schedule I hereto, and (b) in the event and to the extent that the Underwriters shall exercise the election to purchase Optional Designated Securities, as provided below, the Designated Trust agrees to issue and sell to each of the Underwriters, and each of the Underwriters agrees, severally and not jointly, to purchase from the Designated Trust at the purchase price to the Underwriters set forth in Schedule II hereto that portion of the number of Optional Designated Securities as to which such election shall have been exercised. The Designated Trust hereby grants to each of the Underwriters the right to purchase at their election up to the number of Optional Designated Securities set forth opposite the name of such Underwriter in Schedule I hereto on the terms referred to in the paragraph above for the sole purpose of covering over- allotments in the sale of the Firm Designated Securities. Any such election to purchase Optional Designated Securities may be exercised by written notice from the Representatives to the Designated Trust and the Company given within a period of 30 calendar days after the date of this Pricing Agreement, setting forth the aggregate number of Optional Designated Securities to be purchased and the date on which such Optional Designated Securities are to be delivered, as determined by the Representatives, but in no event earlier than the First Time of Delivery or, unless the Representatives and the Company and the Designated Trust otherwise agree in writing, no earlier than ten or later than ten business days after the date of such notice. 2 If the foregoing is in accordance with your understanding, please sign and return to us [___] counterparts hereof, and upon acceptance hereof by you, on behalf of each of the Underwriters, this letter and such acceptance hereof, including the provisions of the Underwriting Agreement incorporated herein by reference, shall constitute a binding agreement between each of the Underwriters and the Designated Trust and the Company. It is understood that your acceptance of this letter on behalf of each of the Underwriters is or will be pursuant to the authority set forth in a form of Agreement among Underwriters, the form of which shall be submitted to the Designated Trust and the Company for examination upon request, but without warranty on the part of the Representatives as to the authority of the signers thereof. Very truly yours, EDISON INTERNATIONAL By:...................................... Name: Title: EIX TRUST [I] [II] [III] By: Edison International, as Depositor By:...................................... Name: Title: Accepted as of the date hereof: [Names of Representatives] By:............................... 3 SCHEDULE I
Number of Maximum Number Firm Designated of Optional Designated Securities Securities Which Underwriter to be Purchased May be Purchased - ----------- --------------- ----------------------- [Names of Representatives] ].......... [Names of other Underwriters].......... Total........................ ============== =======================
4 SCHEDULE II Designated Trust: EIX Trust [I] [II] [III] Title of Designated Securities: [____ % Cumulative Quarterly Income Preferred Securities, Series ___ (QUIPS(SM)] (Liquidation Amount $25 per Preferred Security) Aggregate liquidation amount: Firm Designated Securities: $_________________ Optional Designated Securities: [up to $_______________] [none] Price to public: _____% of the liquidation amount of the Designated Securities Purchase price to Underwriters: _____% of the liquidation amount of the Designated Securities Underwriters' compensation: As compensation to the Underwriters for their commitments hereunder, and in view of the fact that the proceeds of the sale of the Designated Securities will be used by the Designated Trust to purchase the Subordinated Debentures of the Company, the Company hereby agrees to pay at each Time of Delivery to [the Representatives], for the accounts of the several Underwriters, an amount equal to $ ___________ per Designated Security for the Designated Securities to be delivered at each Time of Delivery. Specified funds for payment of purchase price: Federal (same day) Funds Accountants' letter to be delivered on date of Pricing Agreement: Yes 5 Trust Agreement: Amended and Restated Trust Agreement dated as of_______________, ____ among the Company, as Depositor, The Chase Manhattan Bank, as Property Trustee, Chase Manhattan Bank Delaware, as Delaware Trustee, the Regular Trustees named therein and the several Holders of Trust Securities Designated Guarantee: Guarantee Agreement dated as of _____________, ____ between the Company and The Chase Manhattan Bank, as Trustee Designated Subordinated Debentures: [$_____________ aggregate principal amount of ___% Subordinated Deferrable Interest Notes, Series ___, due _______________] Maturity: ______________, _____ [(subject to (i) extension to a date not later than ____________, _____ and (ii) shortening to a date not earlier than ______________, _____)] Interest rate: _____% Interest payment dates: ______________________ of each year, commencing on __________, _____ Extension period: [_______ quarters] [________ semi-annual periods] Redemption provisions: [Set forth in Section ____ of the Trust Agreement] Sinking fund provisions: No sinking fund provisions 6 Exchange for Designated Securities: [The Subordinated Debentures may be delivered in exchange for the Designated Securities as provided in the Trust Agreement] Time of Delivery: ________ a.m., New York City time ___________, _____ Closing location for delivery of Designated Securities: Names and addresses of Representatives: [Representatives] [Address for Notices] 7 ANNEX II Pursuant to Section 7(f) of the Underwriting Agreement, the accountants shall furnish letters to the Underwriters to the effect that: (i) They are independent certified public accountants with respect to the Designated Trust and the Company and its subsidiaries within the meaning of the Act and the applicable rules and regulations adopted by the Commission; (ii) In their opinion, the financial statements and any supplementary financial information and schedules (and, if applicable, financial forecasts and/or pro forma financial information) audited or examined by them and included or incorporated by reference in the Registration Statement or the Prospectus comply as to form in all material respects with the applicable accounting requirements of the Act or the Exchange Act, as applicable, and the related rules and regulations; and, if applicable, they have made a review in accordance with standards established by the American Institute of Certified Public Accountants of the consolidated interim financial statements, selected financial data, pro forma financial information, financial forecasts and/or condensed financial statements derived from audited financial statements of the Company for the periods specified in such letter, as indicated in their reports thereon, copies of which [have been separately furnished to the representative or representatives of the Underwriters (the "Representatives")] [are attached to such letters]; (iii) They have made a review in accordance with standards established by the American Institute of Certified Public Accountants of the unaudited condensed consolidated statements of income, consolidated balance sheets and consolidated statements of cash flows included in the Prospectus and/or included in the Company's Quarterly Reports on Form 10-Q incorporated by reference into the Prospectus, as indicated in their reports thereon, copies of which [have been separately furnished to the Representatives][are attached to such letters]; and on the basis of specified procedures including inquiries of officials of the Company who have responsibility for financial and accounting matters regarding whether the unaudited condensed consolidated financial statements referred to in paragraph (vi)(A)(i) below comply as to form in all material respects with the applicable accounting requirements of the Act and the Exchange Act and the related rules and regulations, nothing came to their attention that caused them to believe that the unaudited condensed consolidated financial statements do not comply as to form in all material respects with the applicable accounting requirements of the Act and the Exchange Act and the related rules and regulations adopted by the Commission; (iv) The unaudited selected financial information with respect to the consolidated results of operations and financial position of the Company for the five most recent fiscal years included in the Prospectus and included or incorporated by reference in Item 6 of the Company's Annual Report on Form 10-K for the most recent fiscal year agrees with the corresponding amounts (after restatement where applicable) in the audited consolidated financial statements for five such fiscal years included or incorporated by reference in the Company's Annual Reports on Form 10-K for such fiscal years; 1 (v) They have compared the information in the Prospectus under selected captions with the disclosure requirements of Regulation S-K and on the basis of limited procedures specified in such letter nothing came to their attention as a result of the foregoing procedures that caused them to believe that this information does not conform in all material respects with the disclosure requirements of Items 301, 302, 402 and 503(d), respectively, of Regulation S-K; (vi) On the basis of limited procedures, not constituting an examination in accordance with generally accepted auditing standards, consisting of a reading of the unaudited financial statements and other information referred to below, a reading of the latest available interim financial statements of the Company and its subsidiaries, inspection of the minute books of the Company and its subsidiaries since the date of the latest audited financial statements included or incorporated by reference in the Prospectus, inquiries of officials of the Company and its subsidiaries responsible for financial and accounting matters and such other inquiries and procedures as may be specified in such letter, nothing came to their attention that caused them to believe that: (A) (i) the unaudited condensed consolidated statements of income, consolidated balance sheets and consolidated statements of cash flows included in the Prospectus and/or included or incorporated by reference in the Company's Quarterly Reports on Form 10-Q incorporated by reference in the Prospectus do not comply as to form in all material respects with the applicable accounting requirements of the Exchange Act and the published rules and regulations adopted by the Commission, or (ii) any material modifications should be made to the unaudited condensed consolidated statements of income, consolidated balance sheets and consolidated statements of cash flows included in the Prospectus or included in the Company's Quarterly Reports on Form 10-Q incorporated by reference in the Prospectus for them to be in conformity with generally accepted accounting principles; (B) any other unaudited income statement data and balance sheet items included in the Prospectus do not agree with the corresponding items in the unaudited consolidated financial statements from which such data and items were derived, and any such unaudited data and items were not determined on a basis substantially consistent with the basis for the corresponding amounts in the audited consolidated financial statements included or incorporated by reference in the Company's Annual Report on Form 10-K for the most recent fiscal year; (C) the unaudited financial statements which were not included in the Prospectus but from which were derived the unaudited condensed financial statements referred to in clause (A) and any unaudited income statement data and balance sheet items included in the Prospectus and referred to in clause (B) were not determined on a basis substantially consistent with the basis for the audited financial statements included or incorporated by reference in the Company's Annual Report on Form 10-K for the most recent fiscal year; 2 (D) any unaudited pro forma consolidated condensed financial statements included or incorporated by reference in the Prospectus do not comply as to form in all material respects with the applicable accounting requirements of the Act and the rules and regulations adopted by the Commission thereunder or the pro forma adjustments have not been properly applied to the historical amounts in the compilation of those statements; (E) as of a specified date not more than five days prior to the date of such letter, there have been any changes in the consolidated capital stock (other than issuances of capital stock upon exercise of options and stock appreciation rights, upon earn-outs of performance shares and upon conversions of convertible securities, in each case which were outstanding on the date of the latest balance sheet included or incorporated by reference in the Prospectus) or any increase in the consolidated long-term debt of the Company and its subsidiaries, or any decreases in consolidated net current assets or stockholders' equity or other items specified by the Representatives, or any increases in any items specified by the Representatives, in each case as compared with amounts shown in the latest balance sheet included or incorporated by reference in the Prospectus, except in each case for changes, increases or decreases which the Prospectus discloses have occurred or may occur or which are described in such letter; and (F) for the period from the date of the latest financial statements included or incorporated by reference in the Prospectus to the specified date referred to in clause (E) there were any decreases in consolidated net revenues or operating profit or the total or per share amounts of consolidated net income or other items specified by the Representatives, or any increases in any items specified by the Representatives, in each case as compared with the comparable period of the preceding year and with any other period of corresponding length specified by the Representatives, except in each case for increases or decreases which the Prospectus discloses have occurred or may occur or which are described in such letter; and (vii) In addition to the audit referred to in their report(s) included or incorporated by reference in the Prospectus and the limited procedures, inspection of minute books, inquiries and other procedures referred to in paragraphs (iii) and (vi) above, they have carried out certain specified procedures, not constituting an audit in accordance with generally accepted auditing standards, with respect to certain amounts, percentages and financial information specified by the Representatives which are derived from the general accounting records of the Company and its subsidiaries, which appear in the Prospectus (excluding documents incorporated by reference), or in Part II of, or in exhibits and schedules to, the Registration Statement specified by the Representatives or in documents incorporated by reference in the Prospectus specified by the Representatives, and have compared certain of such amounts, percentages and financial information with the accounting records of the Company and its subsidiaries and have found them to be in agreement. 3 All references in this Annex II to the Prospectus shall be deemed to refer to the Prospectus (including the documents incorporated by reference therein) as defined in the Underwriting Agreement as of the date of the letter delivered on the date of the Pricing Agreement for purposes of such letter and to the Prospectus as amended or supplemented (including the documents incorporated by reference therein) in relation to the applicable Designated Securities for purposes of the letter delivered at each Time of Delivery for such Designated Securities. 4 ANNEX III 1 [EDISON INTERNATIONAL LETTERHEAD] July ____, 1999 To the Representatives named on Exhibit A hereto of the Underwriters named on Exhibit B hereto Re: Issuance of $500,000,000 Aggregate Liquidation Amount of Cumulative Quarterly Income Preferred Securities, Series A ---------------------------------------------------------- Ladies and Gentlemen: This opinion is rendered to you in compliance with the provisions of subsection (c) of Section 7 of the Underwriting Agreement dated as of July ___, 1999 among Edison International (the "Company"), EIX Trust I ("Trust I"), EIX ------- ------- Trust II and EIX Trust III, each a statutory business trust formed under the laws of the State of Delaware (each a "Trust," and collectively, the "Trusts") ----- ------ and the Representatives (the "Representatives") of the several Underwriters --------------- named in the pricing agreements hereinafter described (the "Underwriting ------------ Agreement") and the Pricing Agreement dated as of July ___, 1999 (the "Pricing - --------- ------- Agreement") among the Company, Trust I and the Representatives. The - --------- Underwriting Agreement and the Pricing Agreement provide for the sale to you of $500,000,000 aggregate principal amount of ___% Cumulative Quarterly Income Preferred Securities, Series A, issued by Trust I (the "QUIPS"). The QUIPS ----- represent undivided beneficial interests in the assets of Trust I, which generally comprise a corresponding principal amount of ___% Subordinated Deferrable Interest Notes, Series A (the "QUIDS") issued by the Company, under a ----- Subordinated Indenture, as amended (the "Indenture"), entered into by and --------- between the Company and The Chase Manhattan Bank, as trustee (the "Trustee"). ------- The QUIPS and QUIDS have been registered under the Securities Act of 1933, as amended (the "Act"), on a Registration Statement on Form S-3 filed with the --- Securities and Exchange Commission (the "Commission") on July 2, 1999 (File No. ---------- 333-82293), as amended by Amendment No. 1 filed with the Commission on July 13, 1999 and Amendment No. 2 filed with the Commission on July ___, 1999 (as so amended, including the documents incorporated by reference therein, the "Registration Statement"). The QUIDS and QUIPS are to be sold as described in - ----------------------- the Registration Statement and the prospectus and prospectus supplement relating to the QUIDS and QUIPS. Capitalized terms used herein without definition have the meanings ascribed to them in the Underwriting Agreement, and, in the case of terms not used in the Underwriting Agreement, the meanings ascribed to them in the Indenture. Representatives Named on Exhibit A July __, 1999 Page 2 I am the Assistant General Counsel and Assistant Secretary of the Company. In rendering the opinions expressed below, I or attorneys acting under my supervision have (a) examined and relied on originals, or copies certified or otherwise identified as true copies of the originals, of such records, documents, certificates and other instruments, (b) made such investigations of law as I have deemed appropriate to enable me to give the opinions expressed below and (c) relied upon appropriate certificates of public officials, officers or employees of the Company and other persons, as to factual matters. I believe that both you and I are justified in relying upon such certificates. I am opining herein as to the effect on the subject transactions only of the federal laws of the United States and the internal laws of the State of California, and I express no opinion with respect to the applicability thereto, or the effect thereon, of the laws of any other jurisdiction, or as to any matters of municipal law or the laws of any local agencies within any state. I am familiar with and have examined the Registration Statement, including the prospectus dated July ___, 1999 (the "Prospectus") and the ---------- prospectus supplement dated July ___, 1999 (the "Prospectus Supplement," and --------------------- together with the Prospectus, the "Final Prospectus"), which Prospectus and ---------------- Prospectus Supplement incorporate by reference certain documents filed with the Commission. Based on the foregoing, it is my opinion that, as of the date hereof: 1. Each of the Company, Southern California Edison Company, a California corporation, Edison Mission Energy, a California corporation, and Edison Capital, a California corporation, has been duly incorporated and is validly existing and in good standing under the laws of the state of its incorporation, with corporate power and authority to own, lease and operate its properties and to conduct its business as described in the Registration Statement and the Final Prospectus. 2. The Company has an authorized capitalization as set forth in the Final Prospectus and all of the issued shares of capital stock of the Company have been duly and validly authorized and issued and are fully paid and non- assessable. 3. To the best of my knowledge, there is no pending or threatened action, suit or proceeding before any court or governmental agency, authority or body or any arbitrator involving the Company or any of its subsidiaries (including Trust I) of a character required to be disclosed in the Registration Statement which is not adequately disclosed in the Final Prospectus. 4. Each of the Underwriting Agreement and the Pricing Agreement has been duly authorized, executed and delivered by Trust I and the Company. 5. Each of the Trust Agreement, the Indenture, the Designated Expense Agreement and the Designated Guarantee has been duly authorized, executed and delivered by Representatives Named on Exhibit A July __, 1999 Page 3 the Company, and each of the Indenture, the Designated Expense Agreement and the Designated Guarantee constitutes a legally valid and binding obligation of the Company, enforceable against the Company in accordance with its terms. 6. Each of the Trust Agreement, the Indenture and the Designated Guarantee has been duly qualified under the Trust Indenture Act. 7. The QUIDS have been duly authorized, executed, issued and delivered by the Company and constitute the legally valid and binding obligation of the Company, enforceable against the Company in accordance with its terms, and are entitled to the benefits provided by the Indenture. 8. The issuance by the Company of the Designated Guarantee and the QUIDS, the issuance and sale by Trust I of the QUIPS, the compliance by the Company with the provisions of the Underwriting Agreement, the Pricing Agreement and the Company Agreements, the compliance by Trust I with the provisions of the Underwriting Agreement, the Pricing Agreement and the Designated Securities and the consummation of the transactions herein and therein contemplated will not: (a) to the best of my knowledge violate any statute or any order, rule or regulation of any court or governmental agency or body having jurisdiction over the Company or any of its properties or Trust I, (b) violate provisions of the Articles of Incorporation or By-laws of the Company, (c) result in the breach of or a default under any material indenture, mortgage, deed of trust, loan agreement or other agreement or instrument known to me to which the Company or any of its subsidiaries is a party or by which the Company or any of its subsidiaries is bound or to which any of the material property or assets of the Company or any of its subsidiaries is subject, or (d) require any consents, approvals, authorizations, registrations, declarations or filings by the Company, except (i) such as have been obtained under the Act and the Trust Indenture Act and (ii) such as may be required under state securities or Blue Sky laws in connection with the purchase and distribution of the QUIPS by the Underwriters or the issuance of the Designated Guarantee and QUIDS by the Company. 9. The statements set forth in (i) the Prospectus under the captions "Description of Securities," "Description of Debt Securities," Description of Preferred Securities," "Description of Preferred Securities Guarantees," "Description of Expense Agreements" and "Relationship Among Preferred Securities, Preferred Securities Guarantees and Subordinated Debt Securities Held by Each Trust" and (ii) in the Final Prospectus under the captions "Description of Series A QUIDS" and "Description of Series A QUIPS," insofar as they constitute a summary of the terms of the QUIPS, the Trust Agreement, the QUIDS, the Indenture, the Designated Guarantee and the Designated Expense Agreement and (y) in the Prospectus under the caption "Plan of Distribution" and (z) in the Final Prospectus under the caption "Underwriting," insofar as they purport to describe the provisions of the laws and documents referred to therein, in each case are accurate and complete in all material respects. To the best of my knowledge, there are no statutes or legal or governmental proceedings required to be described in the Final Prospectus that are not described as required, or contracts of documents of a character required to be described in the Registration Statement or Prospectus (or required to Representatives Named on Exhibit A July __, 1999 Page 4 be filed under the Exchange Act, if upon such filing they would be incorporated by reference therein) or to be filed as exhibits to the Registration Statement that are not described and filed as required. 10. The Registration Statement and the Final Prospectus comply as to form in all material respects with the requirements for registration statements on Form S-3 under the Act and the requirements under the Trust Indenture Act and the rules and regulations of the Commission thereunder; it being understood, however, that I express no opinion with respect to the financial statements, schedules or other financial data included or incorporated by reference in, or omitted from, the Registration Statement or the Final Prospectus or with respect to the Form T-1's. In passing upon the compliance as to form of the Registration Statement and the Final Prospectus, I have assumed that the statements made and incorporated by reference therein are correct and complete. 11. Neither the Company nor Trust I is an "investment company" or an entity "controlled" by an "investment company," as such terms are defined in the Investment Company Act. In addition, I have participated in conferences with officers and other representatives of the Company, representatives of the independent public accountants for the Company, and your representatives, at which the contents of the Registration Statement and the Final Prospectus and related matters were discussed and, although I am not passing upon, and do not assume any responsibility for, the accuracy, completeness or fairness of the statements contained or incorporated by reference in the Registration Statement and the Final Prospectus and have not made any independent check or verification thereof, during the course of such participation, no facts came to my attention that caused me to believe that the Registration Statement, at the time it became effective, contained an untrue statement of a material fact or omitted to state a material fact required to be stated therein or necessary to make the statements therein not misleading, or that the Final Prospectus (including the documents incorporated by reference), as of its date or as of the date hereof, contained or contains an untrue statement of a material fact or omitted or omits to state a material fact necessary to make the statements therein, in light of the circumstances under which they were made, not misleading; it being understood that I express no belief with respect to the financial statements, schedules and other financial data included or incorporated by reference in, or omitted from, the Registration Statement or the Final Prospectus or with respect to the Form T-1's. The opinions rendered in paragraphs 5 and 7, relating to the enforceability of the Indenture, the Designated Expense Agreement, the Designated Guarantee and the QUIDS, respectively, are subject to the following exceptions, limitations and qualifications: (i) the effect of bankruptcy, insolvency, reorganization, moratorium or other similar laws relating to or affecting the rights and remedies of creditors generally; (ii) the effect of general principles of equity, including without limitation concepts of materiality, reasonableness, good faith and fair dealing and possible unavailability of specific performance or injunctive relief, regardless of whether considered in a proceeding in equity or at law; (iii) certain rights, remedies and waivers Representatives Named on Exhibit A July __, 1999 Page 5 contained in the Indenture, the Designated Expense Agreement, the Designated Guarantee and the QUIDS may be limited or rendered ineffective by applicable California laws or judicial decisions governing such provisions, but such laws or judicial decisions do not render the Indenture, the Designated Expense Agreement, the Designated Guarantee and the QUIDS invalid or unenforceable as a whole; (iv) the unenforceability under certain circumstances under law or court decisions of provisions providing for the indemnification of or contribution to a party with respect to a liability where such indemnification or contribution is contrary to public policy; (v) I express no opinion concerning the enforceability of the waiver of rights or defenses contained in the Indenture; (vi) the unenforceability under certain circumstances, under California or federal law or court decisions, of provisions expressly or by implication waiving broadly or vaguely stated rights, unknown future rights, defenses to obligations or rights granted by law, where such waivers are against public policy or prohibited by law; (vii) the unenforceability under certain circumstances of provisions to the effect that rights or remedies are not exclusive, that every right or remedy is cumulative and may be exercised in addition to or with any other right or remedy, that election of a particular remedy or remedies does not preclude recourse to one or more other remedies, that any right or remedy may be exercised without notice, or that failure to exercise or delay in exercising rights or remedies will not operate as a waiver of any such right or remedy; and (viii) the effect of California law, which provides that a court may refuse to enforce, or may limit the application of, a contract or any clause thereof which the court finds as a matter of law to have been unconscionable at the time it was made or contrary to public policy. To the extent that the obligations of the Company under the Company Agreements may be dependent upon such matters, I assume for purposes of this opinion that the parties to each of the Company Agreements (other than the Company) is duly organized, validly existing and in good standing under the laws of its jurisdiction of organization; that each of the Trustee, the Property Trustee, the Delaware Trustee and the Guarantee Trustee is duly qualified to engage in the activities contemplated by the Company Agreement to which it is a party; that each of the Company Agreements has been duly authorized, executed and delivered by the parties thereto (other than the Company) and constitutes a legally valid and binding obligation of the parties thereto (other than the Company) enforceable against such parties in accordance with its terms; and each of the parties (other than the Company) to the Company Agreements is in compliance generally under the Company Agreement to which it is a party and with all applicable laws and regulations; and that each party to each of the Company Agreements (other than the Company) has the requisite organizational and legal power and authority to perform its obligations under the Company Agreements to which it is a party. This opinion is rendered only to you as Representatives of the several Underwriters under the Underwriting Agreement and the Pricing Agreement and is solely for the benefit of the Underwriters in connection with the transactions covered hereby. This opinion may not be relied upon by you for any other purpose, or furnished to, quoted to, or relied upon by any other person, firm or corporation for any purpose, without my prior written consent. Very truly yours, Kenneth S. Stewart EXHIBIT A Representatives --------------- Goldman, Sachs & Co. A.G. Edwards & Sons, Inc. Lehman Brothers Inc. Merrill Lynch, Pierce, Fenner & Smith Incorporated Morgan Stanley & Co. Incorporated PaineWebber Incorporated Prudential Securities Incorporated Salomon Smith Barney Inc. A-1 EXHIBIT B Underwriters ------------ Goldman, Sachs & Co. A.G. Edwards & Sons, Inc. Lehman Brothers Inc. Merrill Lynch, Pierce, Fenner & Smith Incorporated Morgan Stanley & Co. Incorporated PaineWebber Incorporated Prudential Securities Incorporated Salomon Smith Barney Inc. [INSERT OTHER UNDERWRITERS] B-1 -----END PRIVACY-ENHANCED MESSAGE-----