APPENDIX
E
SAVINGS
PLAN
AGREEMENT
BETWEEN
SOUTHERN CALIFORNIA GAS
COMPANY
AND
UTILITY WORKERS
UNION OF
AMERICA,
AFL-CIO
INTERNATIONAL CHEMICAL WORKERS
UNION COUNCIL,
UFCW,
AFL-CIO
JANUARY 1,
2005
SAVINGS
PLAN
AGREEMENT
This Agreement, made and entered into at Los
Angeles, California, as of this tenth day of December, 2004, by and between Southern
California Gas Company, a California corporation, with its principal place of
business at 555 West Fifth Street, in said City and State, party of the first
part, hereinafter referred to as the "Company" and the Utility Workers Union of
America, AFL-CIO, and International Chemical Workers Union Council, UFCW,
AFL-CIO, parties of the second part, hereinafter referred to as the
"Union".
WITNESSETH:
That it is the intent and purpose of the parties
hereto to incorporate herein the provisions of the Company's
Retirement Savings Plan, hereinafter referred to as the "Plan," and that this
Agreement, arrived at through the process of collective bargaining in the manner
provided by law, represents the determination of all issues pertaining directly
or indirectly to the subject of Retirement Savings for employees
covered by this Agreement and sets forth herein the agreement relating to such
benefits to be observed between the parties hereto and that said parties to this
Agreement, acting through their respective duly authorized representatives,
promise and agree as follows:
Article I
-
Scope
The provisions of this Agreement shall apply to all
employees who are covered by that certain Agreement between the parties hereto
dated January 1,
2005, covering rates
of pay, hours of work, and conditions of employment, or by said Agreement as it
may be subsequently modified, or by any superseding
agreement.
Article II –
Statement of the
Retirement Savings
Plans
The provisions of the “Retirement
Savings
Plan, Amended as of January 1, 2005," which is included herein as
Exhibit A and made a part hereof by reference, shall be applicable during the
term of this Agreement without revision, except as provided under Article
III herein, to all employees who are covered by this
Agreement.
Article III
- Modification
Should the Department of Labor or the Internal
Revenue Service of the United States, or any other agency, board, commission, or
bureau having jurisdiction over such matters, disapprove or require any changes
in the provisions of this Agreement, or should any law require such changes, the
parties hereto agree to negotiate appropriate modifications of this Agreement,
limited to those changes needed to meet the minimum requirements of the
law. Should the Company deem it
necessary that the Retirement Savings Plan be modified for administrative
reasons in a manner that
would not affect the amount of
benefits to employees covered by this Agreement, the parties agree to negotiate
appropriate modifications of the Plan.
The Company retains the right to modify the Plan for employees whom this
Agreement does not apply under Article I herein.
Article V -
Term
This Agreement shall be effective from
January 1, 2005 to and including September 30, 2008
TABLE OF
CONTENTS
Page
Section 1 -- Scope
1
Section 2 -- Definitions
1
Section 3 -- Eligibility,
Participation and Transfer
7
Section 4 -- Employee
Contributions, Deferrals and Rollovers
8
Section 5 -- Employer
Contributions
11
Section 6 -- Limitations
11
Section 7 -- Investment Funds
20
Section 8 -- Transfers
22
Section 9 -- Accounts
24
Section 10 -- Quarterly
Statement
26
Section 11 -- Retirement
26
Section 12 -- Death
26
Section 13 -- Termination of
Service Before Retirement
26
Section 14 -- Distribution of
Benefits
26
Section 15 -- Minimum Distribution
Requirements
31
Section 16 -- Disability
Withdrawal
37
Section 17 -- Withdrawal of
Employee Contributions
37
Section 18 -- Withdrawal of
Deferrals and Employer Contributions
38
Section 19 -- Loans To
Participants
39
Section 20 -- Dividends
41
Section 21 -- Rights and Options on
Stock
42
Section 22 -- Forfeitures
43
Section 23 -- Administration
43
Section 24 -- Claims Procedure
44
Section 25 -- Proof of Age
45
Section 26 -- Incompetence
46
Section 27 -- No Assignment of
Interest
46
Section 28 -- Expenses of the
Plan
46
Section 29 -- Future of the
Plan
47
Section 30 -- Termination of the
Plan
47
Section 31 -- Audit of the
Plan
47
Section 32 -- Benefits After
Merger, Consolidation, or Transfer
47
Section 33 -- Forfeiture of
Unclaimed Distributions
48
Appendix A
49
Appendix B
50
Appendix C
51
Appendix D
52
Table 1
59
SOUTHERN CALIFORNIA GAS
COMPANY
RETIREMENT SAVINGS PLAN
Amended and Restated as of January 1,
2005
with Other Effective Dates
Stated
The Southern California Gas Company Retirement Savings Plan
provides employees with retirement benefits to supplement benefits provided
under the Southern California Gas Company Pension Plan. Under the Retirement Savings Plan,
employees may make regular savings investments through payroll deduction in
Stock and other optional investments permitted by the Plan. The Company will make contributions to
the Plan, which will be invested in Stock.
Benefits provided under the Plan normally are distributable to employees
upon their retirement. The Plan and
the Trust established under the Plan constitute parts of a plan intended to
qualify as a stock bonus plan under Section 401 of the Internal Revenue Code of
1986, as amended (the “Code”) as a qualified plan of deferred compensation under
Code Section 401(k), as an individual account Plan under Section 407(d) (3) of
ERISA and together with the ESOP as part
of a plan that satisfies the requirements of an employee stock ownership plan as
defined in Code Section 4975(e)(7) which is designed to invest primarily in
employer securities. The Plan
is designed as an Employee Stock Ownership Plan as defined in Code Section
4975(e) (7) and is designated to invest primarily in Stock.
This amended Plan applies to all employees who are eligible
to participate in the Plan on January 1, 2005, or who
become eligible thereafter. This plan shall be operated in conjunction
with the ESOP.
(a)
“Additional Employee Contributions” means contributions
made on an after-tax basis by a Participant for which no Employer Contributions
are made.
(b)
“Additional Deferrals” means a percentage of before-tax
Earnings that a Participant elects to have his Employer withhold and contribute
to the Plan on his behalf, pursuant to Section 401(k) of the Code, for which no
Employer Contributions are made.
(c)
“Affiliated Company” means Sempra Energy, and any other
Company designated by the Board of Directors of the Company as an “Affiliated
Company.”
(d)
“Base Pay” means Earnings less overtime, merit and lump
sum or other incentive compensation programs.
(e)
“Basic Employee Contributions” means contributions made
on an after-tax basis by a Participant matched 50 percent by Employer
Contributions.
(f)
“Basic Deferrals” means a percentage of before-tax
Earnings that a Participant elects to have his Employer withhold and contribute
to the Plan on his behalf, pursuant to Section 401(k) of the Code, matched 50
percent by Employer Contributions.
(g)
“Beneficiary” means in the case of a married Participant
who dies on or after August 23, 1984, his surviving spouse, unless the spouse
has consented to the naming of another Beneficiary as set forth below, and in
the case of an unmarried Participant, the person or persons last designated by
the Participant on a form prescribed by the Company to receive any distributions
under the Plan after the Participant’s death. No designation of Beneficiary
shall be effective until delivered to the Company during the Participant’s
lifetime. If there is no
Beneficiary living at the time of a Participant’s death, the estate of the
deceased Participant shall be the Beneficiary. A designation by a married Participant
of a Beneficiary other than the Participant’s spouse shall be invalid in the
case of any Participant who dies on or after August 23, 1984, unless the spouse
consents in writing to such designation, and the spouse’s consent acknowledges
the effect of the election and is witnessed by a Plan representative or a notary
public. Any consent by a spouse
under the preceding sentence shall be effective only with respect to such
spouse.
(h)
“Company” means Southern California Gas Company.
(i)
“Controlled Group” means a group which includes each
corporation that is a member of the controlled group of corporations, within the
meaning of Section 1563(a) (determined without regard to Sections 1563(a) (4)
and 1563(e) (3) (C)) of the Internal Revenue Code, of which the Southern
California Gas Company is a member, and each trade or business (whether or not
incorporated) with which the Southern California Gas Company is under common
control within the meaning of Section 414(c) of the Internal Revenue Code.
(j)
“Contributions” means both Basic and Additional Employee
Contributions.
(k)
“Deferrals” means both Basic and Additional
Deferrals.
(l)
“Distribution” means the payment of benefits upon the
retirement, death or other termination of Service of any Participant, as
provided in Sections 11, 12, 13, and 14.
(m)
“Earnings” prior to January 1, 1984, means the regular basic straight time
rate of earnings per payroll period which an employee receives for his
Employment, as determined under rules established by the Company from time to
time. Effective January 1, 1984, “Earnings” means the regular
basic straight time earnings per payroll period which an employee receives for
his Employment, plus the amount of Basic and Additional Deferrals for such
period, as determined under rules established by the Company from time to
time. Earnings shall not include
compensation in excess of the dollar limitation then in effect under Code
Section 401(a)(17) as adjusted for cost of living pursuant to Code Section 415
(d). Earnings shall include the
annualized award from the Incentive Compensation programs listed in Table
1. Effective January 1, 2001, earnings shall also include
overtime.
(n)
“Eligible Earnings” means Earnings less overtime
pay.
(o)
“Employer” means the Company and each Affiliated Company
whose employees participate in the Plan.
(p)
“Employer Contributions” means contributions made by a
Participant’s Employer pursuant to
Section 5(a).
(q)
“Employment” means employment by the Company or any
Affiliated Company.
(r)
“ERISA” means the Employee Retirement Income Security
Act of 1974, as amended.
(s)
“ESOP” means the
Sempra Energy Employee Stock Ownership Plan, as in effect from time to
time.
(s)(t)
“Highly Compensated Employee” includes
highly compensated active employees and highly compensated former
employees.
A highly compensated active employee includes any employee
who performs service for the employer during the determination year and who,
during the look back year: (i)
received compensation from the employer in excess of $80,000 (as adjusted
pursuant to section 415 (d) of the Code) and was a member of the top-paid group
for such preceding year; or (ii) who is a 5 percent owner at any time during the
look-back year or determination year.
For this purpose, the determination year shall be the plan
year. The look-back year shall be the twelve-month period immediately preceding
the determination year.
A highly compensated former employee includes any employee
who separated from service (or was deemed to have separated) prior to the
determination year, performs no service for the employer during the
determination year, and was a highly compensated active employee for either the
separation year or any determination year ending on or after the employee’s 55th
birthday.
The determination of who is a highly compensated employee,
including the determinations of the number and identity of employees in the
top-paid group, will be made in accordance with Section 414(q) of the Code and
the regulations thereunder.
For purposes of determining whether or not an employee is a
Highly Compensated Employee, the determination year is the Plan Year for which
the determination of who is highly compensated is being made.
(t)(u)
“Investment Funds” means, collectively or
singly as the context requires, the Stock Fund, the Equity Fund(s), the Stable
Income Fund, the Bond Fund(s), the International Fund(s), the Life Cycle Funds,
the Brokerage Window, and the Money Market Fund, which are separate portions of
the Trust described in Section 7.
(u)(v)
“Month” means a calendar month.
(v)(w)
“Normal Retirement Date” means the last day
of the calendar month next following the employee’s 65th
birthday.
(w)(x)
“Optional Early Retirement Date” means the
last day of any calendar month following the date the employee has reached age
55 and completed 15 years of service or more.
(x)(y)
“Payroll Period” means the two week period
specified on each paycheck.
(y)(z)
“Plan Year” means the calendar
year.
(z)(aa)
“Recordkeeper” means, T. Rowe Price
Retirement Plan Services, Inc., or such successor as may be designated from time
to time by the Company, acting pursuant to a recordkeeping services agreement
entered into by the Company, Sempra Energy, and such Recordkeeper. Notwithstanding any other provision of
this Plan to the contrary neither T. Rowe Price Retirement Plan Services, Inc.,
nor any of its affiliates, employees, representatives, or agents shall be deemed
to be the plan administrator, plan sponsor, or a fiduciary of the Plan as
defined in Sections 3 (16) (A), 3(16) (B), or 3(21) (A) respectively of
ERISA.
(aa)(bb)
“Related Plan” means a plan established by
an Affiliated Company, the provisions of which are similar to the provisions of
this Plan and the contributions to which are paid into the Trust established
under this Plan.
(bb)(cc)
“Rollover” means amounts transferred to
the Trust on behalf of a Participant in accordance with subsection 4 (i)
(cc)(dd)
Prior to January 1, 1976, “Service” or “Continuous Service” means continuous
Employment. Effective January 1, 1976, “Service” means
(except for (4) below) all years of employment expressed in the following
manner:
(1)
Years of Service shall mean a consecutive twelve-month
period in which the employee is credited with at least 1,000 hours of service,
commencing on the employee’s employment commencement date. Once an employee has
completed his initial consecutive twelve-month period, all subsequent
consecutive twelve-month periods will be based on a Plan Year beginning with the
first Plan Year following his employment commencement date.
(2)
Except as provided in subparagraph (5) below, no credit
shall be given for service for any period which constitutes a “break in
service.” After 1975, break in
service shall be any calendar year during which an employee works 500 hours or
less. Prior to January 1, 1976, a “break in service” shall mean
any cessation of regular employment according to the rules of the Company in
effect at the time.
(3)
For purposes of subparagraph (1) and subparagraph (2)
above, “hours of service” shall mean each hour for which an employee is paid or
entitled to payment on account of (a) performance of duties, including overtime,
(b) reasons other than performance of duties, or (c) an award or agreement for
back pay, irrespective of mitigation of damages. “Hours of service” shall not be credited
under both (c) and Ca) or (b) “Hours of service” shall also include each hour
for which an employee would have been scheduled while on strike authorized by
his collective bargaining agreement. “Hours of Service” shall include under (b)
each hour for which an employee is eligible to receive Disability Benefits under
the Disability Benefit Plan of the Company or of a member of the Controlled
Group. For nonperformance of
duties, an employee shall be credited for hours of service based upon the number
of his regularly scheduled working hours.
Hours of
service shall be credited to the computation period in which the duties are
performed in the case of (a) above, in which duties are not performed in the
case of (b) above or while an employee is on authorized strike, or to the
computation period to which the award or agreement for back pay pertains in the
case of (c) above.
Solely for
purposes of determining whether a break in service has occurred, for purposes of
determining participation and vesting, but not an employee’s contribution
percentage under Section 4, an employee who is absent from work for maternity or
paternity reasons, in the case of any absence beginning on or after January 1,
1985, shall receive credit for the hours of service which otherwise would
normally have been credited to such employee but for such absence, or in any
case in which such hours cannot be determined, eight hours of service per day of
absence, except that the total number of hours treated as hours of service by
reason of maternity or paternity reasons shall not exceed 501. For purposes of this paragraph, an
absence from work for maternity or paternity reasons, means an absence (1) by
reason of the pregnancy of the employee, (2) by reason of the birth of a child
of the employee, (3) by reason of the placement of a child with the employee in
connection with the adoption of such child by such employee or (4) for purposes
of caring for such child for a period beginning immediately following such birth
or placement. The terms and
conditions of this leave are defined in an applicable collective bargaining
agreement. No credit shall be given
pursuant to this paragraph unless the employee furnishes the Company such timely
information as the Plan may reasonably require to establish that the absence
from work is for maternity or paternity reasons as defined herein and the number
of days for which there was such absence. The hours of service credited under
this paragraph shall be credited only in the year in which the absence begins if
a Participant would be prevented from incurring a one-year break in service in
such year solely because of such crediting, or in any other case, in the
immediately following year.
To the
extent not covered above, for nonperformance of duties, hours of service and the
computation period to which they shall be credited shall be determined in
accordance with Department of Labor Regulation, Section 2530.200b-2(b) and
(c).
(4)
No credit shall be given for service prior to any break
in service which occurs prior to January
1, 1975. No credit shall
be given for service prior to a break in service which occurs after December 31,
1975, and prior to January 1, 1985, unless an employee (a) was vested prior to
the most recent break in service under the Plan then in effect, or (b) the total
years of service prior to the break in service exceeds the number of consecutive
one-year breaks in service. No
credit shall be given for service prior to a break in service which occurs after
December 31, 1984 unless an employee (a) was vested prior to the most recent
break in service under the Plan then in effect, (b) the total years of service
prior to the break in service exceeds the number of consecutive one-year breaks
in service, or (c) the number of consecutive one-year breaks in service is less
than five. The total years of
service prior to any break in service shall not include any years of service not
required to be taken into account by reason of any prior break in service. Under the above rules, the total years
of service of a Participant do not include any years of service prior to January
1, l976 and January 1, 1985,
which were not taken into account under the terms of the Plan in effect
immediately preceding such dates.
If the years of service prior to such break in service cannot be
disregarded under the above rules, the employee shall again be eligible to
participate (provided that the employee elects to make contributions to the
Plan) as of his rehire date. Years
of Service after such break in service or period of five consecutive one-year
breaks in service shall have no effect upon the Participant’s interest in his
Employer Account as it previously existed.
(5)
The following types of leaves of absence shall not
constitute a break in service:
(A)
in the event an employee is:
(i)
on approved personal leave,
(ii) on
military leave while his reemployment rights are protected by law, or
(iii) on extended
or limited union leave.
Service, both
prior to and during such leaves of absence and after return to work, shall be
aggregated for purposes of determining service under the Plan, provided that (a)
an employee returns to employment in accordance with the requirements of such
approved leave and (b) in the case of military leave, an employee leaves his
Employer directly to enter the Armed Forces of the United States and returns
directly to the employ of his Employer within the period during which employment
rights are protected by the Selective Service Act.
(B)
in the event an employee is:
(i)
placed on layoff status (not to exceed period of service or two
years),
(ii) on
dependent care leave, or
Service, prior
to such layoff or leaves of absence and after return to work, shall be
aggregated for purposes of determining service under the Plan, provided that an
employee returns to employment in accordance with the requirements of such
approved leave.
(6)
Except with respect to Related Partnerships, as provided
in subparagraph (7), for purposes of determining eligibility under Section 3 and
whether a Participant is vested in his Employer Account under Section 13 (but
not for determining his employee contribution percentage under Section 4),
Service shall include service for any corporation or other business entity which
is a member of the Controlled Group in addition to service for Southern
California Gas Company and any Affiliated Company.
(7)
For purposes of determining eligibility under Section 3,
a Participant’s employee contribution percent