Exhibit 10.5
[FORM OF AMENDED AND RESTATED CHANGE-IN-CONTROL AGREEMENT]
AMENDED AND RESTATED CHANGE-IN-CONTROL AGREEMENT
 
This Amended and Restated Change-in-Control Agreement (the “Agreement”) is dated
as of [   ], is entered into by and between [     ] (the “Executive”) and
[Golden State Water Company, a California corporation][American States Utility
Services, Inc., a California corporation][NEEDS TO BE CHANGED TO BE SIGNED BY
ACTUAL EMPLOYER] (the “Company”), and amends and restates in its entirety the
Change-in-Control Agreement dated as of [   ] between the Executive and the
Company.

RECITALS

The Company considers it essential to the best interest of the Company and its
shareholders that the Executive be encouraged to remain with the Company and
continue to devote full attention to the Company’s business notwithstanding the
possibility, threat or occurrence of a Change in Control (as defined in Section
3).  The Company believes that it is in the best interest of the Company, its
shareholder and the shareholders of its parent, American States Water Company, a
California corporation (“AWR”), to reinforce and encourage the continued
attention and dedication of the Executive and to diminish inevitable
distractions arising from the possibility of a Change in Control.  Accordingly,
to assure the Company that it will have the Executive’s undivided attention and
services notwithstanding the possibility, threat or occurrence of a Change in
Control, and to induce the Executive to remain in the employ of the Company, and
for other good and valuable consideration, the Board of Directors of the Company
has, at the recommendation of the Company’s Compensation Committee, caused the
Company to enter into this Agreement.

TERMS AND CONDITIONS

The Executive and the Company hereby agree to the following terms and
conditions:

1.      Term of Agreement

If a Change in Control (as defined in Section 3) occurs on or before the
expiration date of this Agreement and while the Executive is still an employee
of the Company, then this Agreement will continue in effect for two years from
the date of such Change in Control and, if the Executive’s employment with the
Company is terminated within such two-year period, this Agreement shall
thereafter continue in effect until all of the obligations of the Company under
this Agreement shall have been fulfilled.  If no Change in Control occurs on or
before December 31,  2010, this Agreement shall expire; provided, however that
this Agreement shall be automatically extended for an additional two years to
December 31, 2012 if (i) a plan or agreement for a Change in Control has been
approved by the Board of Directors of AWR, on or before the expiration date, or
(ii)  the Company has not delivered to you or you shall have not delivered to
the Company written notice at least 60 days prior to the expiration date that
such expiration date shall not be so extended.  This Agreement shall continue to
be automatically extended for an additional two-year period and each succeeding
two-year period if a plan or agreement for a Change in Control has been approved
by the Board of Directors of AWR, or the Company or the Executive fails to give
notice by the time and in the manner described in this Section 1.
 
2.      Change in Control Date

The “Change in Control Date” shall mean the first date during the term of this
Agreement on which a Change in Control (as defined in Section 3) occurs;
provided, however, that if a Change in Control occurs and if the Executive’s
employment with the Company is terminated after approval by the Board of
Directors of AWR of a plan or agreement for a Change in Control but prior to the
date on which the Change in Control occurs, the “Change in Control Date” shall
mean the date immediately preceding the date of such termination.
 

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3.      Change in Control

A “Change in Control” shall mean any of the following events:

(a)           any sale, lease, exchange or other change in ownership (in one or
a series of transactions) of all or substantially all of the assets of AWR,
unless its business is continued by another entity in which holders of AWR’s
voting securities immediately before the event own, either directly or
indirectly, more than fifty-five percent (55%) of the continuing entity’s voting
securities immediately after the event;

(b)           any reorganization or merger of AWR, unless the holders of AWR’s
voting securities immediately before the event own, either directly or
indirectly, more than fifty-five percent (55%) of the continuing or surviving
entity’s voting securities immediately after the event, and (ii) at least a
majority of the members of the Board of Directors of the surviving entity
resulting from such reorganization or merger were members of the incumbent Board
of Directors of AWR at the time of the execution of the initial agreement or of
the action of such incumbent Board of Directors providing for such
reorganization or merger;

(c)           an acquisition by any person, entity or group acting in concert of
more than fifty-five percent (55%) of the voting securities of AWR, unless the
holders of AWR’s voting securities immediately before the event own, either
directly or indirectly, more than fifty-five percent (55%) of the acquirer’s
voting securities immediately after the acquisition;

(d)           the consummation of a tender offer or exchange offer by any
individual, entity or group which results in such individual, entity or group
beneficially owning (within the meaning of Rule 13d-3 promulgated under the
Securities Exchange Act of 1934 twenty-five percent (25%) or more of the voting
securities of AWR, unless the tender offer is made by AWR or any of its
subsidiaries or the tender offer is approved by a majority of the members of the
Board of Directors of AWR who were in office at the beginning of the twelve
month period preceding the commencement of the tender offer; or

(e)           a change of one-half or more of the members of the Board of
Directors of  AWR within a twelve-month period, unless the election or
nomination for election by shareholders of new directors within such period
constituting a majority of the applicable Board was approved by a vote of at
least two-thirds (2/3) of the directors then still in office who were in office
at the beginning of the twelve month period.

4.      Effective Period

For the purpose of this Agreement, the “Effective Period” is the period
commencing on the Change in Control Date and ending on the date this Agreement
terminates.

5.      Termination of Employment

(a)           Death or Disability:  The Executive’s employment shall terminate
automatically upon the Executive’s death.  If the Disability (as defined below)
of the Executive occurs during the Effective Period, the Company may give the
Executive written notice of its intention to terminate the Executive’s
employment.  In such event, the Executive’s employment with the Company shall
terminate effective on the 30th day after receipt of such notice by the
Executive (the “Disability Effective Date”), provided that, within the 30 days
after such receipt, the Executive shall not have returned to full-time
performance of his or her duties.  For purposes of this Agreement, “Disability”
shall mean the absence of the Executive from his or her duties with the Company
on a full-time basis for 180 consecutive business days as a result of a physical
or mental condition which prevents the Executive from performing the Executive’s
normal duties of employment and which is (i) determined to be total and
permanent by a physician selected by the Company or its insurers and acceptable
to the Executive or the Executive’s legal representative and/or (ii) entitles
the Executive to the payment of long-term disability benefits from the Company’s
or AWR’s long-term disability plan commencing no later than the Disability
Effective Date.
 

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(b)           Cause:  The Company may terminate the Executive’s employment other
than for Cause or Disability during the Effective Period. The Company may also
terminate the Executive’s employment during the Effective Period for Cause. For
purposes of this Agreement, “Cause” shall be limited to the following:
 
(i)           the Executive’s failure to render services to the Company where
such failure amounts to gross neglect or gross misconduct of the Executive’s
responsibility and duties,

(ii)           the Executive’s commission of an act of fraud or dishonesty
against the Company or any affiliate of the Company, or

(iii)           the Executive’s conviction of a felony or other crime involving
moral turpitude.

(c)           Good Reason:  The Executive’s employment may be terminated by the
Executive during the Effective Period for Good Reason.  For purposes of this
Agreement, “Good Reason” shall mean:
 
(i)           the assignment to the Executive of any duties inconsistent in any
respect with the Executive’s position (including status, offices, titles and
reporting requirements), authority, duties or responsibilities as in effect on
the Change in Control Date, or any other action by the Company or AWR which
results in a diminution in such position, authority, duties or responsibilities,
excluding for this purpose an isolated, insubstantial and inadvertent action not
taken in bad faith and which is remedied by the Company or AWR, as applicable,
promptly, but in no event more than thirty (30) days after receipt of notice
thereof given by the Executive;
 
(ii)           any failure by the Company or AWR  to reappoint the Executive to
a position held by the Executive on the Change in Control Date, except as a
result of the termination of the Executive’s employment by the Company for Cause
or Disability, the death of the Executive, or the termination of the Executive’s
employment by the Executive other than for Good Reason;

(iii)           reduction by the Company or AWR in the Executive’s base salary
in effect on the date hereof or as the same may be increased from time-to-time;
 
(iv)           elimination by the Company or AWR of any cash incentive or other
cash bonus compensation plan, without providing substitutes herefore, or any
modification of the terms thereof that would substantially diminish (in the
aggregate, taking into consideration changes in salary, etc.) the aggregate
amount of the base salary and cash incentive or other cash bonus that is
reasonably expected to be earned by the Executive during any calendar year from
the aggregate amount that would reasonably have been expected to be earned by
the Executive, assuming the maintenance of the cash incentive or cash bonus
compensation plan or plans in effect on the Change in Control Date;
 
(v)           the taking of any action by the Company or AWR (including the
elimination of benefit plans without providing substitutes herefore or the
reduction of the Executive’s benefits thereunder) that would substantially
diminish the aggregate value of the Executive’s other fringe benefits, including
the executive benefits and perquisites, from the levels in effect prior to the
Change in Control Date;
 
 
 

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(vi)           the Company or AWR provides written notice to the Executive that
the Executive will be based at any office or location which increases the
distance from the Executive’s home to the office location by more than 35 miles
from the distance in effect as of the Change in Control Date; and

(vii)           any failure by the Company or AWR to comply with and satisfy
Section 11© of this Agreement.
 
6.      Obligations of the Company upon Termination

(a)           Good Reason, Other Than for Cause or Disability:  If the Company
shall terminate the Executive’s employment other than for Cause or Disability
during the Effective Period, or the Executive shall terminate employment for
Good Reason during the Effective Period, the Company and AWR agree, subject to
Sections 6(f), 8 and 9, to make the payments and provide the benefits described
below:
(i)           The Company or AWR shall pay to the Executive in a cash lump sum
within 10 days from the date of the Executive’s termination of employment, an
amount equal to the product of (A) and (B), where (A) is 2.99 and (B) is
calculated as the sum of (i) the Executive’s annual base salary at the highest
rate in effect in any year of the three calendar years immediately preceding the
date of termination of employment; plus (ii) the average of the payments made to
the Executive pursuant to any “cash-pay” performance incentive plan of the
Company or AWR (a “Cash Incentive Payment”) during the five calendars years
immediately preceding the date of termination of employment (or, in the event
that the Executive has less than five calendar years of credited service, the
sum of the Executive’s Cash Incentive Payments during the number of calendar
years of the Executive’s employment with AWR or any of its subsidiaries divided
by the number of calendar years of the Executive’s employment with AWR or any of
its subsidiaries); and provided that if the Executive is employed pursuant to
any written employment agreement, the Cash Incentive Payment in any year for
purposes of calculations under this clause (ii) shall not be less than any
minimum incentive or annual cash bonus required thereunder; provided that Cash
Incentive Payments do not include (A) any extraordinary bonus, including any
holiday, year end, anniversary or signing bonus; (B) any amounts paid or to be
paid to the Executive under this Agreement, (C) reimbursement of moving or other
expenses; or (D) any other lump sum payment, unless specifically designated as a
Cash Incentive Payment pursuant to an incentive plan of the Company or AWR by
the Board of Directors of AWR or the Company, or any committee thereof; plus
(iii) the average of the amount of cash received by the Executive with respect
to dividend equivalents credited to the account of the Executive (“Dividend
Equivalents”) during the five calendar years immediately preceding the date of
termination of employment (or, in the event that the Executive has less than
five calendar years of credited service or any such year did not include
Dividend Equivalent payments, the sum of the Dividend Equivalents during the
number of calendar years of the Executive’s employment with AWR or any of its
subsidiaries divided by the number of calendar years of the Executive’s
employment with AWR or any of its subsidiaries and in which Dividend Equivalents
were paid). Unless otherwise provided pursuant to the terms of the cash
incentive compensation plan of AWR or the Company or the terms of the award, the
amount paid to the Executive pursuant to this Section 6(a)(i) shall be in lieu
of any Cash Incentive Payment to which the Executive would otherwise be entitled
under any cash incentive plan of the Company or AWR for the year in which the
Executive’s employment is terminated as a result of a Change in Control.
 
 
 

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(ii)           The Company or AWR shall also pay to the Executive in a cash lump
sum within 10 days from the date of the Executive’s termination of employment,
an amount equal to the sum of (A) the Executive’s base salary through the date
of termination, plus (B) any accrued vacation pay, in each case to the extent
not theretofore paid (the amounts referred to in this paragraph (ii) are
hereinafter referred to as the “Accrued Obligations”).

(iii)           The Company or AWR shall also pay to the Executive in a cash
lump sum within 10 days from the date of the Executive’s termination of
employment, an amount equal to the excess of (A) over (B), where (A) is equal to
the single sum actuarial equivalent of what would be the Executive’s accrued
benefits under the terms of the Golden State Water Company Pension Plan, or any
successor thereto, including the Golden State Water Company Pension Restoration
Plan and any other supplemental retirement plan providing pension benefits
(hereinafter together referred to as the “Pension Plan”) at the time of the
Executive’s termination of employment, without regard to whether such benefits
would be vested thereunder, if the Executive were credited with an additional
three years of credited service (as defined in the Pension Plan), and (B) is
equal to the single sum actuarial equivalent of the Executive’s vested accrued
benefits under the Pension Plan at the time of the Executive’s termination of
employment.  For purposes of this paragraph (iii), the term “single sum
actuarial equivalent” shall be determined using an interest rate equal to six
percent (6%) and the mortality table named and described in detail in Section
A.1 of the Pension Plan after the reduction (if any) of the Executive’s benefit
using the “Regular Factors” under Section A.4 of the Pension Plan and using the
Executive’s age upon termination of employment.  Any payment under this
paragraph (iii) shall not extinguish any rights the Executive has to benefits
under the Pension Plan.

(iv)           For [three years for CEO and CFO]  two years after the date of
the Executive’s termination of employment, or such longer period as may be
provided by the terms of the appropriate plan, program, practice or policy, the
Company shall continue to provide medical, dental, vision, accidental death and
dismemberment, and life insurance coverage, and reimbursement of club dues to
the Executive and/or the Executive’s family at least equal to those which would
have been provided to them if the Executive’s employment had not been terminated
(in accordance with the most favorable plans, practices, programs or policies of
the Company and its affiliates applicable generally to other peer executives and
their families immediately preceding the date of the Executive’s termination of
employment); provided, however, that if the Executive becomes employed by
another employer and is eligible to receive medical or other welfare benefits
under another employer-provided plan, the medical and other welfare benefits
described herein shall be secondary to those provided under such other plan
during such applicable period of eligibility.  For purposes of determining
eligibility (but not the time of commencement of benefits) of the Executive for
any retiree benefits pursuant to such plans, practices, programs and policies,
the Executive shall be considered to have remained employed until [three years
for CEO and CFO] two years after the date of termination of employment and to
have retired on the last day of such period.  Following the period of continued
benefits referred to in this subsection, the Executive and the Executive’s
covered family members shall be given the right provided in Section 4980B of the
Internal Revenue Code of 1986 (the “Code”) to elect to continue benefits in all
group medical plans.  In the event that the Executive’s participation in any of
the plans, programs, practices or policies of the Company referred to in this
subsection is barred by the terms of such plans, programs, practices or policies
or applicable law, the Company shall provide the Executive with benefits
substantially similar to those which the Executive would be entitled as a
participant in such plans, programs, practices or policies.  At the end of the
period of coverage, the Executive shall have the option to have assigned to the
Executive, at no cost and with no apportionment of prepaid premiums, any
assignable insurance policy owned by the Company and relating specifically to
the Executive.
 
 
 

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(v)           The Company and AWR shall enable the Executive to purchase within
10 days following the Executive’s termination of employment, the automobile, if
any, provided by the Company for the Executive’s use at the time of the
Executive’s termination of employment at the wholesale value of such automobile
at such time, as shown in the current edition of the National Auto Research
Publication Blue Book.

(vi)           To the extent not theretofore paid or provided, the Company or
AWR shall timely pay or provide the Executive any other amounts or benefits
required to be paid or provided or which the Executive is eligible to receive
under any plan, program, policy, practice, contract or agreement of the Company
and its affiliates (such other amounts and benefits being hereinafter referred
to as “Other Benefits”) in accordance with the terms of such plan, program,
policy, practice, contract or agreement.

(vii)           The Executive shall be entitled to interest on any payments not
paid on a timely basis as provided in this Section 6(a) at the applicable
Federal Rate provided for in Section 7872(f)(2)(A) of the Code.

(viii)                      Upon the occurrence of a Change in Control, each
stock option granted to an Executive under any stock incentive plan of AWR or
the Company shall become immediately exercisable, and each restricted stock
award under any stock incentive plan of AWR or the Company shall immediately
vest free of restrictions.  If the vesting of any stock option or restricted
stock award has been accelerated expressly in anticipation of a Change in
Control and the Board of  Directors later determines that a Change in Control
will not occur, the effect of the acceleration as to any then outstanding and
unexercised stock option or restricted stock award shall be rescinded. In no
event shall any such stock option or restricted stock award be reinstated or
extended beyond its final expiration date.

(b)           Death:  If the Executive’s employment is terminated by reason of
the Executive’s death during the Effective Period, this Agreement shall
terminate without further obligations to the Executive’s legal representatives
under this Agreement, other than for payment of Accrued Obligations and the
timely payment or provision of Other Benefits.  Accrued Obligations shall be
paid to the Executive’s estate or beneficiary, as applicable, in a cash lump sum
within 10 days of the date of the Executive’s death.
 
 
 

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(c)           Disability:  If the Executive’s employment is terminated by reason
of the Executive’s Disability during the Effective Period, this Agreement shall
terminate without further obligations to the Executive, other than for payment
of Accrued Obligations and the timely payment or provision of Other Benefits.
Accrued Obligations shall be paid to the Executive in a cash lump sum within 10
days of the Executive’s termination of employment.

(d)           Cause, Other than for Good Reason:  If the Executive’s employment
shall be terminated for Cause during the Effective Period or, if the Executive
voluntarily terminates employment during the Effective Period, excluding a
termination for Good Reason, this Agreement shall terminate without further
obligations to the Executive, other than for Accrued Obligations and any
benefits payable to the Executive under a plan, policy, practice, etc., referred
to in Section 7 below.  Accrued Obligations shall be paid to the Executive in a
cash lump sum within 10 days of the Executive’s termination of employment.

(e)           Payment of Club Dues.  This Section 6(e) shall apply to any club
dues that may be reimbursed pursuant to Section 6(a)(iv) that exceed the de
minimus amounts set forth in Treasury Regulations Section 1.409A-1(b)(9)(v)(D)
(the “Club Dues”).  The amount of Club Dues that the Executive receives in one
taxable year shall not affect the amount of Club Dues that the Executive
receives in any other taxable year.  To the extent the Executive is reimbursed
for any Club Dues, such reimbursement shall be paid to the Executive on or
before the last day of the Executive’s taxable year following the taxable year
in which the expense was incurred.  The Club Dues are not subject to liquidation
or exchange for another benefit.

(f)           Six-Month Delay.  Notwithstanding any other provisions of the
Agreement, any payment or benefit otherwise required to be made after the
Executive’s termination of employment that the Company reasonably determines is
subject to Section 409A(a)(2)(B)(i) of the Code, shall not be paid or payment
commenced until the later of (i) six months after the date of the Executive’s
“separation from service” (within the meaning of Section 409A of the Code and
Treasury Regulations Section 1.409A-1(h) without regard to optional alternative
definitions available thereunder) and (ii) the payment date or commencement date
specified in the Agreement for such payment(s).  With respect to any benefit
that the Company cannot provide during the six-month period following the
Executive’s separation from service pursuant to the preceding sentence, the
Executive shall pay the cost or premium for such benefit during such period and
be reimbursed by the Company herefore.  On the earliest date on which such
payments can be made or commenced without violating the requirements of
Section 409A(a)(2)(B)(i) of the Code, the Executive shall be paid, in a single
cash lump sum, an amount equal to the aggregate amount of all payments delayed
pursuant to this Section 6(f), including reimbursement for any premiums paid by
the Executive as a result of the delay.
 
7.      Non-Exclusivity of Rights

Subject to Section 8, nothing in this Agreement shall prevent or limit the
Executive’s continuing or future participation in any plan, program, policy or
practice provided by the Company or any of its affiliates and for which the
Executive may qualify, nor, subject to Sections 6(f), 8 and 20, shall anything
herein limit or otherwise affect such rights as the Executive may have under any
contract or agreement with the Company or any of its affiliates. Amounts which
are vested benefits or which the Executive is otherwise entitled to receive
under any plan, policy, practice, program, contract or agreement with the
Company or any of its affiliates at or subsequent to the date of termination of
the Executive’s employment shall be payable in accordance with such plan,
policy, practice, program, contract or agreement except as explicitly modified
by this Agreement.

8.      Limitation on Benefits

Notwithstanding anything in this Agreement to the contrary, if any payments or
benefits to be made to or for the Executive’s benefit, whether pursuant to this
Agreement or otherwise, whether by the Company or another entity or person,
would not be deductible by the Company due to limitations imposed by Section
162(m) of the Code, then to the extent permitted by Treasury Regulation
Section 1.409A-2(b)(7)(i) without subjecting the Executive to adverse tax
consequences, such payments or benefits shall be delayed.  The delayed amounts
shall be paid to the Executive at the earliest date the Company reasonably
anticipates that the deduction of the payment of the amount will not be limited
or eliminated by application of Section 162(m) of the Code; provided, however,
that if the Executive is a Specified Employee, to the extent deemed necessary to
comply with Treasury Regulations Section 1.409A-3(i)(2), the delayed payment
shall not be made before the end of the six-month period following the
Executive’s separation from service.  The Executive shall also be entitled to
interest on any payments deferred as a result of the limitations on
deductibility under Section 162(m) of the Code at the applicable Federal Rate
provided for in Section 7872(f)(2)(A) of the Code.  Either the Company or the
Executive may request a determination as to whether any payments would be
subject to limitations on deductibility under Section 162(m) of the Code and, if
so requested, such determination shall be made by independent legal counsel
selected by the Company and approved by the Executive.
 
 
 

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9.      Parachute Payments

(a)           Gross-Up Payment.  In the event that any payment or distribution
by the Company to or for the benefit of the Executive (whether paid or payable
or distributed or distributable pursuant to the terms of this Agreement or
otherwise, but determined without regard to any additional payments under this
Section 9(a)) (a “Payment”) is determined to be subject to the excise tax
imposed by Section 4999 of the Code, or any interest or penalties are incurred
by the Executive with respect to such excise tax (such excise tax, together with
any such interest and penalties, are hereinafter collectively referred to as the
“Excise Tax”), then the Company shall pay promptly to the Executive an
additional payment (a “Gross-Up Payment”) in an amount such that after payment
by the Executive of all taxes (including any interest or penalties imposed with
respect thereto) and Excise Tax imposed upon the Gross-Up Payment, Executive
retains an amount of the Gross-Up Payment equal to the Excise Tax imposed upon
such Payments.

(b)           Accounting Firm.  Subject to the provisions of Section 9(c), all
determinations required to be made under this Section 9, including whether a
Gross-Up Payment is required and the amount of such Gross-Up Payment and the
assumptions to be utilized in arriving at such determination, shall be made by
PricewaterhouseCoopers LLP or, if that firm declines the engagement, such other
certified public accounting firm as may be designated by the Executive and which
is satisfactory to the Company (the “Accounting Firm”), which shall provide
detailed supporting calculations both to the Company and to the Executive within
15 business days after such determinations are requested by the Executive or the
Company.  All fees and expenses of the Accounting Firm shall be borne solely by
the Company.  The Company shall pay any Gross-Up Payment, as determined pursuant
to this Section 9(b), to the Executive within 5 days after the receipt by the
Company of the Accounting Firm’s determination.  As a result of the uncertainty
in the application of Section 4999 of the Code at the time of the initial
determination by the Accounting Firm hereunder, it is possible that Gross-Up
Payments which will not have been made by the Company should have been made (an
“Underpayment”), consistent with the calculations required to be made
hereunder.  In the event that the Company exhausts its remedies pursuant to
Section 9(c) and the Executive thereafter is required to make a payment of any
Excise Tax, the Accounting Firm shall determine the amount of the Underpayment
that has occurred and the Company shall pay such Underpayment promptly to or for
the benefit of the Executive.
 
(c)           Internal Revenue Service Claims.  Executive shall notify the
Company in writing of any claim by the Internal Revenue Service that, if
successful, would require the payment by the Company of a Gross-Up
Payment.  Such notification shall be given as soon as practicable but no later
than 10 business days after Executive is informed in writing of such claims and
shall apprise the Company of the nature of such claim, and the date on which
such claim is requested to be paid.  The Executive shall not pay such claim
prior to the expiration of the 30-day period following the date on which it
gives such notice to the Company (or such shorter period ending on the date that
any payment of taxes with respect to such claim is due).  If the Company
notifies the Executive in writing prior to the expiration of such period that it
desires to contest such claim, the Executive shall:
 
 
 

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(i)           Give the Company any information reasonably requested by either of
them relating to such claim,

(ii)           Take such action in connection with contesting such claim as the
Company shall reasonably request in writing from time to time, including,
without limitation, accepting legal representation with respect to such claim by
an attorney reasonably selected by the Company,

(iii)           Cooperate with the Company in good faith in order to contest
such claim effectively, and

(iv)           Permit the Company to participate in any proceedings relating to
such claim;

provided, however, that the Company shall bear and pay directly all costs and
expenses (including additional interest and penalties) incurred in connection
with such contest and shall indemnify and hold the Executive harmless, on an
after-tax basis, for any Excise Tax or income tax (including interest and
penalties with respect thereto) imposed as a result of such representation and
payment of costs and expenses.  Without limitation on the foregoing provisions
of this Section 9©, the Company shall control all proceedings taken in
connection with such contests and, at its sole discretion, may pursue or forgo
any and all administrative appeals, proceedings, hearings and conferences with
the taxing authority in respect of such claim and may, at its sole option,
either direct the Executive to pay the tax claimed and sue for a refund or
contest the claim in any permissible manner, and the Executive agrees to
prosecute such contest to a determination before any administrative tribunal, in
a court of initial jurisdiction and in one or more appellate courts, as the
Company shall determine; provided, however that if the Company directs the
Executive to pay such claim and sue for a refund, the Company shall pay the
amount of such payment to the Executive, and shall indemnify and hold the
Executive harmless, on an after-tax basis, from any Excise Tax or income tax
(including interest or penalties with respect thereto) imposed with respect to
such payment or with respect to any imputed income with respect to such payment;
and further provided that any extension of the statute of limitations relating
to payment of taxes for the taxable year of the Executive with respect to which
such contested amount is claimed to be due is limited solely to such contested
amount.  Furthermore, the control by the Company of the contest shall be limited
to issues with respect to which the Gross-Up Payment would be payable hereunder
and the Executive shall be entitled to settle or contest, as the case may be,
any other issue raised by the Internal Revenue Service or any other taxing
authority.

(d)           Refunds. If, after receipt by the Executive of an amount paid by
the Company pursuant to Section 9©, the Executive becomes entitled to receive
any refund with respect to such claim, the Executive shall (subject to
compliance by the Company with the requirements of Section 9©) promptly pay to
the Company the amount of such refund (together with any interest paid or
credited thereon after taxes applicable thereto).  If, after receipt by the
Executive of an amount paid by the Company pursuant to Section 9©, a
determination is made that the Executive shall not be entitled to any refund
with respect to such claim and the Company does not notify the Executive in
writing of its intent to contest such denial of refund prior to the expiration
of 30 days after such determination, then such advance shall be forgiven and
shall not be required to be repaid and the amount of such payment shall offset,
to the extent thereof, the amount of Gross-Up Payment required to be paid.

(e)           Payment.  Notwithstanding anything herein to the contrary, any
payment under this Section 9 shall be paid to the Executive by the end of the
Executive’s taxable year following the taxable year in which the Executive pays
the related taxes.
 
 
 

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10.           Full Settlement

The obligation of the Company to make the payments provided for in this
Agreement and otherwise to perform its obligations hereunder shall not be
affected by any set-off, counterclaim, recoupment, defense or other claim, right
or action which the Company may have against the Executive or others. In no
event shall the Executive be obligated to seek other employment or take any
other action by way of mitigation of the amounts payable to the Executive under
any of the provisions of this Agreement and, except as provided in
Section 6(a)(iv), such amounts shall not be reduced whether or not the Executive
obtains other employment.

11.           Successors

(a)           This Agreement is personal to the Executive and shall not be
assignable by the Executive other than by will or the laws of descent and
distribution.  This Agreement shall inure to the benefit of and be enforceable
by the Executive’s legal representatives.

(b)           This Agreement shall inure to the benefit of and be binding upon
the Company and its successors and assigns.

(c)           The Company will require any successor (whether direct or
indirect, by purchase, merger, consolidation or otherwise) to all or
substantially all of the business and/or assets of the Company to assume
expressly and agree to perform this Agreement in the same manner and to the same
extent that the Company would be required to perform it if no such succession
had taken place.  As used in this Agreement, the “Company” shall mean the
Company as defined and any successor to its business and/or assets which assumes
and agrees to perform this Agreement by operation of law, or otherwise, and
“AWR” shall mean AWR as defined and any successor to its business and/or assets
by operation of law or otherwise.
 
12.           Arbitration

(a)           Because it is agreed that time will be of the essence in
determining whether any payments are due to the Executive under this Agreement,
the Executive may submit any claim for payment under this Agreement or dispute
regarding the interpretation of this Agreement to arbitration.  This right to
select arbitration shall be solely that of the Executive, and the Executive may
decide whether or not to arbitrate in his or her discretion.  The “right to
select arbitration” is not mandatory on the Executive, and the Executive may
choose in lieu thereof to bring an action in an appropriate civil court.  Once
arbitration is commenced, however, it may not be discontinued without the mutual
consent of both parties to the arbitration.  During the lifetime of the
Executive only he or she can use the arbitration procedure set forth in this
section.

(b)           Any claim for arbitration may be submitted as follows: If the
Executive disagrees with the Company regarding the interpretation of this
Agreement and the claim is finally denied by the Company in whole or in part,
such claim may be filed in writing with an arbitrator of the Executive’s choice
who is selected by the method described in the next three sentences. The first
step of the selection shall consist of the Executive submitting a list of 5
potential arbitrators to the Company.  Each of the five arbitrators must be
either (1) a member of the National Academy of Arbitrators located in the State
of California or (2) a retired California Superior Court or Appellate Court
judge.  Within 2 weeks after receipt of the list, the Company shall select one
of the five arbitrators as the arbitrator for the dispute in question.  If the
Company fails to select an arbitrator in a timely manner, the Executive shall
then designate one of the five arbitrators as the arbitrator for the dispute in
question.

(c)           The arbitration hearing shall be held within 30 days (or as soon
thereafter as possible) after the picking of the arbitrator.  No continuance of
the hearing shall be allowed without the mutual consent of the Executive and the
Company. Absence from or nonparticipation at the hearing by either party shall
not prevent the issuance of an award.  Hearing procedures which will expedite
the hearing may be ordered at the arbitrator’s discretion, and the arbitrator
may close the hearing at his or her discretion when sufficient evidence to
satisfy issuance of an award has been presented.
 
 
 

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(d)           The arbitrator’s award shall be rendered as expeditiously as
possible and in no event later than 30 days after the close of the hearing.  In
the event the arbitrator finds that the Company has breached this Agreement, he
or she shall order the Company to immediately take the necessary steps to remedy
the breach. The award of the arbitrator shall be final and binding upon the
parties.  The award may be enforced in any appropriate court as soon as possible
after it is rendered.  If an action is brought to confirm the award, the Company
and the Executive agree that no appeal shall be taken by either party from any
decision rendered in such action.

(e)                      Each party will pay the fees of their respective
attorneys, the expenses of their witnesses, costs of any record or transcript of
the arbitration, and any other expenses connected with the arbitration that such
party might be expected to incur had the dispute been subject to resolution in
court, but all costs of the arbitration that would not be incurred by the
parties if the dispute was litigated in court, including fees of the arbitrator
and any arbitration association administrative fees will be paid by the Company.

13.           Governing Law

The laws of California shall govern the validity and interpretation of this
Agreement, with regard to conflicts of laws.

14.           Captions

The captions of this Agreement are not part of the provisions hereof and shall
have no force or effect.

15.           Amendment

This Agreement may not be amended or modified otherwise than by a written
agreement executed by the parties hereto or their respective successors and
legal representatives.

16.           Notices

All notices and other communications regarding this Agreement shall be in
writing and shall be hand delivered to the other party or sent by prepaid
registered or certified mail, return receipt requested, addressed as follows:

If to the
Executive:                                           [___________________]
 [___________________]
 [___________________]

If to the
Company:                                           [___________________]
 [___________________]
 [___________________]

or to such other address as either party shall have furnished to the other in
writing. Notice and communications shall be effective when actually received by
the addressee.

17.           Severability

The lack of validity or enforceability of any provision of this Agreement shall
not affect the validity or enforceability of any other provision of this
Agreement.
 
 
 

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18.           Withholding Taxes

The Company may withhold required federal, state, local or foreign taxes from
any amounts payable under this Agreement.

19.           No Waiver

The Executive’s or the Company’s failure to insist upon strict compliance with
any provision of this Agreement or the failure to assert any right the Executive
or the Company may have under this Agreement, including, without limitation, the
right of the Executive to terminate employment for Good Reason, shall not be
deemed to be a waiver of such provision or right or any other provision or right
under this Agreement.

20.           At-Will Employment

The Executive and the Company acknowledge that, except as may otherwise be
provided under any other written agreement between the Executive and the
Company, the employment of the Executive by the Company prior to the Change in
Control Date is “at will” and, prior to the Change in Control Date, the
Executive’s employment may be terminated by either the Executive or the Company
at any time, in which case the Executive shall have no further rights under this
Agreement. From and after the Change in Control Date, this Agreement shall
supersede any other agreement between the parties with respect to the subject
matter hereof.

21.           Counterparts

This Agreement may be executed simultaneously in one or more counterparts, each
of which shall be deemed an original, but all of which shall together constitute
one and the same Agreement.

22.           Section 409A

It is intended that any amounts payable under this Agreement shall either be
exempt from Section 409A of the Code or shall comply with Section 409A
(including Treasury regulations and other published guidance related thereto) so
as not to subject the Executive to payment of any additional tax, penalty or
interest imposed under Section 409A of the Code.  The provisions of this
Agreement shall be construed and interpreted to avoid the imputation of any such
additional tax, penalty or interest under Section 409A of the Code yet preserve
(to the nearest extent reasonably possible) the intended benefit payable to the
Executive.

IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be duly
executed and delivered as of the day and year first written above in San Dimas,
California.

[GOLDEN STATE WATER COMPANY]
[AMERICAN STATES UTILITY SERVICES, INC.]
By           __________________________________
    Title

EXECUTIVE
_________________________________________
[_____________]