Exhibit
10.7
SEMPRA
ENERGY
AMENDED
AND RESTATED
RETIREMENT PLAN FOR DIRECTORS
Sempra Energy,
a California corporation (“Sempra Energy”), maintains
the Sempra Energy Retirement Plan for Directors (the
“Plan”).
Sempra Energy
hereby amends and restates the Plan, effective as of
__________________, except as otherwise provided herein. This
amendment and restatement of the Plan is intended to comply with
the requirements of Sections 409A(a)(2), (3) and (4) of the Code
(as defined below) and the Treasury Regulations thereunder.
Also, the name of the Plan is hereby amended to be
“Sempra Energy Amended and Restated Retirement Plan for
Directors.”
Paragraph 8 of
the Plan is hereby deleted, effective as of December 31, 2004.
Paragraph 8 provided that a Director’s benefits under
the Plan would be offset by such Director’s benefits under
the Sempra Energy Executive Security Bonus Plan (the
“EBP”). The EBP was terminated effective as of
December 31, 2004 and, consequently, the offset ceased to
apply.
1.
PURPOSE
The purpose of
this unfunded Plan is to retain outstanding directors for Sempra
Energy. A member of the Sempra Energy Board of Directors is
referred to herein as a “Director.”
2.
ELIGIBILITY
Members of the
Sempra Energy Board of Directors who participated in a Director
Retirement Plan maintained by Pacific Enterprises, Enova
Corporation or San Diego Gas & Electric (a “Prior
Plan”) shall be eligible to participate in this Plan, which
is a successor to the Prior Plan.
The names of
the Directors participating in the Plan, each Director’s
Benefit Service, and each Director’s Distribution Form under
the Plan as in effect as of the date hereof, are set forth on
Exhibit A hereto. No other Director shall participate
in this Plan.
3.
LUMP SUM
DISTRIBUTION
A
participating Director whose Distribution Form is a lump sum shall
receive a lump sum benefit which is the actuarial equivalent of the
benefit in paragraph 4 (exclusive of any benefit derived from
retainer and/or fee increases after such Director’s
Separation from Service). Subject to Exhibit B hereto,
the benefit payment shall be made to such Director within thirty
(30) days following such Director’s Separation from Service.
Actuarial equivalency shall be determined using the
“Gatt rate” for the calendar month preceding the
calendar month in which the Director’s Separation from
Service occurs.
4.
ANNUAL
BENEFIT; ANNUAL BENEFIT DISTRIBUTION
A
participating Director whose Distribution Form is an annual benefit
shall receive an annual retirement benefit equal to the sum of (a)
the then-current year’s annual base retainer for a Director
(exclusive of any amount paid for committee service); and (b) the
then-current fee for a Director for attending a regularly scheduled
meeting of the full Sempra Energy Board of Directors in California,
multiplied by 10, subject to upward adjustments if the retainer
and/or meeting fee increases subsequent to the Director’s
Separation from Service. In the event that an increase
occurs, the Director’s retirement benefit will be adjusted
effective with the next scheduled payment.
Subject to
Exhibit B, benefit payments to a participating Director whose
Distribution Form is an annual benefit will start on the first day
of the calendar quarter on or next following the date of such
Director’s Separation from Service, provided such Director is
at least age 65 on the date of such Separation from Service.
Subject to Exhibit B, in the case of an eligible Director
whose Distribution Form is an annual benefit and whose Separation
from Service occurs prior to age 65, such Director will start
receiving benefit payments on the first day of the calendar quarter
on or next following the date such Director attains age 65.
Benefits will be paid on the first day of each quarter
thereafter, and will be paid for a period equal to the length of
the Director’s Benefit Service. Each quarterly payment
will be one-fourth the annual retirement benefit. There are
no death benefits payable under this Plan except as provided in
paragraph 5.
5.
CHANGE IN
DISTRIBUTION FORM
A
participating Director may elect on a one-time basis to change such
Director’s Distribution Form in accordance with this
paragraph 5. The participating Director shall make such
election on such form as is prescribed by the Company’s
Compensation Committee. Such election shall be irrevocable
when made, and shall not take effect until at least twelve (12)
months after the date on which the election is made. Such
election shall provide that the Director’s benefit shall be
deferred for a period of five years from the date such benefit
would otherwise have been paid (or in the case of benefits payable
in installment payments treated as a single payment, five years
from the date the first benefit was scheduled to be paid).
Such election shall be made in accordance with Treasury
Regulation Section 1.409A-2(b).
6.
SURVIVOR
BENEFITS
If a
participating Director dies after the start of benefit payments,
his/her beneficiary shall receive the remaining payments, if any,
to which the participating Director would have been entitled but
for his/her death. If a participating Director dies prior to
the start of benefit payments, his/her beneficiary will receive a
benefit calculated pursuant to paragraph 3, within thirty (30) days
following the participating Director’s death. A
participating Director shall designate a beneficiary on such form
as is prescribed by the Company’s Compensation Committee.
In the case of a participating Director who is married, such
Director may designate
