Exhibit 10.2


SOUTHERN CALIFORNIA WATER COMPANY

PENSION RESTORATION PLAN
















TABLE OF CONTENTS


	
  

  	
   

  	
   

  	
   

  	
  Page

  	
   

  
	
  ARTICLE I

  	
   

  	
  1

  	
   

  
	
   

  	
   

  	
  1.1 - Title

  	
   

  	
  1

  	
   

  
	
   

  	
   

  	
  1.2 - Purpose

  	
   

  	
  1

  	
   

  
	
   

  	
   

  	
  1.3 - Definitions

  	
   

  	
  2

  	
   

  
	
  ARTICLE II

  	
   

  	
  3

  	
   

  
	
   

  	
   

  	
  2.1 - Eligibility
  Requirements

  	
   

  	
  3

  	
   

  
	
  ARTICLE III

  	
   

  	
  3

  	
   

  
	
   

  	
   

  	
  3.1 - Payment

  	
   

  	
  3

  	
   

  
	
  ARTICLE IV

  	
   

  	
  3

  	
   

  
	
   

  	
   

  	
  4.1 - Retirement
  Benefit

  	
   

  	
  3

  	
   

  
	
   

  	
   

  	
  4.2 - Benefit
  Limitation

  	
   

  	
  4

  	
   

  
	
   

  	
   

  	
  4.3 - Payment of
  Retirement Benefits

  	
   

  	
  4

  	
   

  
	
   

  	
   

  	
  4.4 - Small Benefit

  	
   

  	
  5

  	
   

  
	
   

  	
   

  	
  4.5 - Forfeiture of
  Benefits

  	
   

  	
  5

  	
   

  
	
   

  	
   

  	
  4.6 - Spouse
  Pre-Retirement Death Benefit

  	
   

  	
  5

  	
   

  
	
  ARTICLE V

  	
   

  	
  6

  	
   

  
	
   

  	
   

  	
  5.1 - Committee

  	
   

  	
  6

  	
   

  
	
   

  	
   

  	
  5.2 - Agents

  	
   

  	
  7

  	
   

  
	
   

  	
   

  	
  5.3 - Binding Effect
  of Decisions

  	
   

  	
  7

  	
   

  
	
   

  	
   

  	
  5.4 - Indemnity

  	
   

  	
  7

  	
   

  
	
   

  	
   

  	
  5.5 - Claim
  Procedure

  	
   

  	
  8

  	
   

  
	
  ARTICLE VI

  	
   

  	
  8

  	
   

  
	
   

  	
   

  	
  6.1 - Amendments and
  Termination

  	
   

  	
  8

  	
   

  
	
   

  	
   

  	
  6.2 - Protection of
  Accrued Benefits

  	
   

  	
  8

  	
   

  
	
  ARTICLE VII

  	
   

  	
  9

  	
   

  
	
   

  	
   

  	
  7.1 - Unfunded Plan

  	
   

  	
  9

  	
   

  
	
   

  	
   

  	
  7.2 - Unsecured
  General Creditor

  	
   

  	
  9

  	
   

  
	
   

  	
   

  	
  7.3 - Trust Fund

  	
   

  	
  10

  	
   

  
	
   

  	
   

  	
  7.4 - Nonassignability

  	
   

  	
  10

  	
   

  
	
   

  	
   

  	
  7.5 - Limitation on
  Participants’ Rights

  	
   

  	
  10

  	
   

  
	
   

  	
   

  	
  7.6 - Participants
  Bound

  	
   

  	
  11

  	
   

  
	
   

  	
   

  	
  7.7 - Receipt and
  Release

  	
   

  	
  11

  	
   

  
	
   

  	
   

  	
  7.8 - Federal Law
  Governs

  	
   

  	
  11

  	
   

  
	
   

  	
   

  	
  7.9 - Headings and Subheadings

  	
   

  	
  12

  	
   

  
	
   

  	
   

  	
  7.10-Successors and Assigns

  	
   

  	
  12

  	
   

  



 



 i















SOUTHERN CALIFORNIA WATER COMPANY


PENSION RESTORATION PLAN


THIS PLAN is adopted, effective the 1st day of
January, 1997, by SOUTHERN CALIFORNIA WATER COMPANY, a California corporation (“Company”),
and evidences the terms of a Pension Restoration Plan for certain executives.


W I T N E S S E T H


ARTICLE I


TITLE, PURPOSE AND DEFINITIONS


1.1 - Title.


This
plan shall be known as the “Southern California Water Company Pension
Restoration Plan.”


1.2 - Purpose.


The purpose of this Plan is to supplement retirement benefits
payable to certain participants in the Southern California Water Company
Pension Plan, as amended and in effect from time to time (“Pension Plan”) by
making up benefits which are reduced by virtue of Sections 401(a)(17) or 415 of
the Internal Revenue Code of 1986.  No
payment shall be made under this Plan which duplicates a benefit payable under
any other deferred compensation plan or employment agreement of the Company.



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1.3 - Definitions.


Unless defined herein, any word, phrase or term used
in this Plan with initial capitals shall have the meaning given therefor in the
Pension Plan.


“Company” means Southern California Water Company or
any successor corporation by merger, consolidation, or otherwise.


“Employer” means the Company and any subsidiary or any
other member of its consolidated group (for federal tax purposes) designated by
the Board of Directors to participate in the Plan.


“Eligible Employee” means each individual who meets
each of the following requirements: 
(1) he or she is an officer of the Employer; (2) he or she is
a participant in the Pension Plan; (3) his or her Pension Plan benefits
are reduced by the application of Sections 401(a)(17) or 415 of the Code; and
(4) he or she is designated as an Eligible Employee by the Board of Directors.


“Participant” means any Eligible Employee who is
eligible for participation in this Plan as specified in Section 2.1.


“Plan” means the Southern California Water Company
Pension Restoration Plan as set forth in this Agreement and all subsequent
amendments hereto.


“Plan
Year” means the calendar year.



 2
 









ARTICLE II


PARTICIPATION


2.1 - Eligibility Requirements.


An Employee who is an Eligible Employee shall become a
Participant on the later of the date he or she becomes vested under the Pension
Plan or becomes an Eligible Employee.


ARTICLE III


PAYMENT OF BENEFITS


3.1 - Payment.


There shall be no funding of any benefit which may
become payable hereunder.  The Company
may, but is not obligated to, invest in any assets or in life insurance
policies which it deems desirable to provide assets for payments under this
Plan but all such assets or life insurance policies shall remain the general
assets of the Company.  In connection
with any such investments and as a condition of further participation in this
Plan, Participants shall execute any documentation reasonably requested by the
Company.


ARTICLE IV


RETIREMENT
BENEFITS


4.1 - Retirement
Benefit.


Subject to Section
4.3, a Participant’s retirement benefit under this Plan shall equal the excess
of A over B where:



 3
 









A equals the Participant’s vested retirement benefit
under the Pension Plan, commencing on the date benefits commence under the
Pension Plan, and payable in form of benefit elected by the Participant (and
spouse, if applicable) under the Pension Plan, calculated by ignoring Sections
401(a)(17) and 415 of the Code (and the Pension Plan provisions implementing
those Code sections), and


B equals the vested retirement benefit actually
payable under the Pension Plan, commencing on the date benefits commence under
the Pension Plan, and payable in form of benefit elected by the Participant
(and spouse, if applicable) under the Pension Plan.


4.2 - Benefit
Limitation.


Notwithstanding any other provisions of the Plan, in
the event that any benefit provided under this agreement would, in the opinion
of counsel for the Company, not be deductible in whole or in part in the
calculation of the federal income tax of the Company by reason of Section 280G
of the Internal Revenue Code of 1986 (the “Code”), the aggregate benefits provided
hereunder shall be reduced so that no portion of any amount which is paid to
the Participant or Beneficiary is not deductible for tax purposes by reason of
Section 280G of the Code.


4.3 - Payment
of Retirement Benefits.


Upon a Participant’s commencement of benefits under
the Pension Plan, the Employer shall commence to pay to such retired
Participant (or beneficiary, if applicable, after the Participant’s death) the
monthly retirement benefit to which the Participant is entitled under 



 4
 









this Plan, commencing on the date benefits commence
under the Pension Plan, and payable in form of benefit elected by the
Participant (and spouse, if applicable) under the Pension Plan.  No benefits shall be payable under this Plan
while the Participant is an Employee.


4.4 - Small
Benefit.


Notwithstanding any other provision or provisions of
this Plan to the contrary, if any benefit hereunder is for an amount of less
than fifty dollars per month, such benefit shall instead be paid in a lump sum
which is the Actuarial Equivalent of such monthly benefit.


4.5 - Forfeiture
of Benefits.


Notwithstanding any provision of this Plan to the
contrary, no benefits shall be payable under this Plan with respect to any
Participant if the Participant confesses to, is convicted of, or pleads no
contest to, any act of fraud, theft or dishonesty arising in the course of, or
in connection with, his or her employment with the Employer.


4.6 - Spouse Pre-Retirement Death Benefit.


If a Participant’s spouse is entitled to a
pre-retirement death benefit under Section 4.12 of the Pension Plan, the
monthly benefit, if any, payable upon the death of a Participant to the
Participant’s spouse, commencing upon the date that monthly benefits to such
spouse commence under Section 4.12 of the Pension Plan and payable for the
period such benefit is payable under the Pension Plan, shall be equal to the
excess, if any, of:



 5
 









(a)           The
monthly death benefit determined in accordance with Section 4.12 of the Pension
Plan, calculated by ignoring Sections 401(a)(17) and 415 of the Code (and the
Pension Plan provisions implementing those Code sections),


over


(b)           The
amount of the monthly spouse death benefit payable to the Participant’s spouse
pursuant to Section 4.12 of the Pension Plan.


No benefits under
this Section 4.7 shall be paid if the benefits payable pursuant to any other
provisions of this Article IV have already commenced.


ARTICLE V


COMMITTEE


5.1 - Committee.


This Plan shall be administered by the Committee.  The Committee shall have the authority to
(i) make, amend, interpret, and enforce all appropriate rules and
regulations for the administration of this Plan and (ii) decide or resolve
any and all questions, including interpretations and constructions of this Plan
as may arise in connection with the Plan. 
The Committee shall also have all rights and duties set forth in Section
6.3 of the Pension Plan.  The Committee
shall have full discretion to construe and interpret the terms and provisions
of this Plan.  The Committee members may
be Participants under this Plan.



 6
 









5.2 - Agents.


The Committee may, from time to time, employ other
agents and delegate to them such administrative duties as it sees fit, and may
from time to time consult with counsel who may be counsel to the Company.


5.3 - Binding
Effect of Decisions.


The decision or action of the Committee in respect of
any questions arising out of or in connection with the administration,
interpretation and application of the Plan and the rules and regulations
promulgated hereunder shall be final and conclusive and binding upon all
persons having any interest in the Plan.


5.4 - Indemnity.


To the extent permitted by applicable federal and
state laws the Company shall indemnify and save harmless the Board of
Directors, the Committee and each member of each thereof, and any employee
appointed pursuant to Section 5.2, against any and all expenses, liabilities
and claims, including legal fees to defend against such liabilities and claims,
arising out of their discharge in good faith of responsibilities under or incident
to the Plan, excepting only expenses and liabilities arising out of willful
misconduct or gross negligence.  This
indemnity shall not preclude such further indemnities as may be available under
insurance purchased by the Company or provided by the Company under any Bylaw,
agreement, vote of stockholders or disinterested directors or otherwise, as
such indemnities are permitted under state law.



 7
 









5.5 - Claim
Procedure.


The entire claim procedure set forth in Section 6.3(g)
of the Pension Plan, as amended from time to time, is hereby incorporated by
reference.


ARTICLE VI


AMENDMENT AND TERMINATION


6.1 - Amendments
and Termination.


The Company shall have the right to amend this Plan
(and to amend or cancel any amendments) from time to time by resolution of the
Board of Directors.  Such amendment shall
be stated in an instrument in writing, executed by the Company in the same
manner as this Plan.  The Company also
reserves the right to terminate this Plan at any time by resolution of the
Board of Directors.


6.2 - Protection
of Accrued Benefits.


This
Plan is strictly a voluntary undertaking on the part of the Company and shall
not be deemed to constitute a contract between the Company and any Eligible
Employee (or any other employee) or a consideration for, or an inducement or
condition of employment for the performance of services by any Eligible
Employee or employee.  Although the
Company reserves the right to amend or terminate this Plan at any time and,
subject at all times to the provisions of Section 4.3, no such amendment or
termination shall result in the forfeiture of benefits accrued pursuant to this
Plan as of the date of termination.  The
benefits accrued at that time shall be the lesser of (1) the 



 8
 









benefit that would
be payable if the Participant terminated employment on the date of termination,
or (2) the benefit that would be payable at actual retirement under the
Pension Plan (or death, if earlier) if this Plan were terminated.


ARTICLE VII


MISCELLANEOUS


7.1 - Unfunded
Plan.


All benefits due under this Plan to a Participant
shall be paid by the Employer that employed that Participant.  This Plan is intended to be an unfunded plan
maintained primarily to provide deferred compensation benefits for a select
group of “management or highly compensated employees” within the meaning of
Section 201, 301 and 401 of the Employee Retirement Income Security Act of
1974, as amended (“ERISA”), and therefore to be exempt from the provisions of
Parts 2, 3 and 4 of Title I of ERISA.


7.2 - Unsecured
General Creditor.


In the event of an Employer’s insolvency, Participants
and their Beneficiaries, heirs, successors and assigns shall have no legal or
equitable rights, interest or claims in any property or assets of Employer, nor
shall they be beneficiaries of, or have any rights, claims or interest in any
life insurance policies, annuity contracts or the proceeds therefrom owned or
which may be acquired by Employer.  In
that event, any and all of Employer’s assets and policies shall be, and remain,
unrestricted by the provisions of this Plan. 
An Employer’s obligation under the Plan shall be that of an unfunded and
unsecured promise of Employer to pay money in the future.



 9
 









7.3 - Trust
Fund.


Each Employer shall be responsible for the payment of
all benefits provided under the Plan to Participants employed by it.  At its discretion, the Company may establish
one or more trusts, with such trustees as the Board may approve, for the
purpose of providing for the payment of such benefits.  Such trust or trusts may be irrevocable, but the
assets thereof shall be subject to the claims of the Company’s creditors.  To the extent any benefits provided under the
Plan are actually paid from any such trust, the Employer shall have no further
obligation with respect thereto, but to the extent not so paid, such benefits
shall remain the obligation of, and shall be paid by, the Employer.


7.4 - Nonassignability.


None of the benefits, payments, proceeds or claims of
any Participant or Beneficiary shall be subject to any claim of any creditor
and, in particular, the same shall not be subject to attachment or garnishment
or other legal process by any creditor, nor shall any Participant or
Beneficiary have any right to alienate, anticipate, commute, pledge, encumber
or assign any of the benefits or payments or proceeds which he may expect to
receive, contingently or otherwise, under this agreement.


7.5 - Limitation on Participants’ Rights.


Participation in this Plan shall not give any Eligible
Employee the right to be retained in the Employer’s employ or any right or
interest in the Plan other than as herein 



 10
 









provided.  The
Employer reserves the right to dismiss any Eligible Employee without any
liability for any claim against the Employer, except to the extent provided
herein.


7.6 - Participants
Bound.


Any action with respect to this Plan taken by the
Committee or by the Company, or any action authorized by or taken at the
direction of the Committee or the Company, shall be conclusive upon all
Participants and Beneficiaries entitled to benefits under the Plan.


7.7 - Receipt
and Release.


Any payment to any Participant or Beneficiary in
accordance with the provisions of this Plan shall, to the extent thereof, be in
full satisfaction of all claims against the Employer and the Committee, and the
Committee may require such Participant or Beneficiary, as a condition precedent
to such payment, to execute a receipt and release to such effect.  If any Participant or Beneficiary is
determined by the Committee to be incompetent by reason of physical or mental
disability (including minority) to give a valid receipt and release, the
Committee may cause the payment or payments becoming due to such person to be
made to another person for his or her benefit without responsibility on the
part of the Committee or the Company to follow the application of such funds.


7.8 - Federal Law Governs.


This Plan shall be construed, administered, and
governed in all respects under federal law (except as otherwise provided by
Section 5.4), and to the extent that federal law is inapplicable, under the
laws of the State of California, provided, however, that if any provision is
susceptible to more than one interpretation, such interpretation shall be given
thereto as 



 11
 









consistent with this Plan being an unfunded plan
described in Section 7.1.  If any
provision shall be held by a court of competent jurisdiction to be invalid or
unenforceable, the remaining provisions hereof shall continue to be fully
effective.


7.9 - Headings
and Subheadings.


Headings and subheadings in this agreement are inserted
for convenience of records only and are not to be considered in the
construction of the provisions hereof.


7.10 -  Successors and Assigns.


This agreement shall inure to the benefit of, and be
binding upon, the parties hereto and their successors and assigns.



 12














FIRST
AMENDMENT

TO THE

SOUTHERN CALIFORNIA WATER COMPANY

PENSION RESTORATION PLAN


Effective as of the
date set forth below, the Southern California Water Company Pension Restoration
Plan (the “Plan”) is amended to provide that:


FIRST:                   With
respect to Participants who retire on or after November 1, 2005, Section
4.1 is amended in its entirety to provide as follows:


“4.1 — Retirement Benefit.


Subject to Section 4.3, a Participant’s retirement
benefit under this Plan shall equal the excess of A over B where:


A equals the Participant’s vested retirement benefit
under the Pension Plan, commencing on the date benefits commence under the
Pension Plan, and payable in the form of benefit elected by the Participant
(and spouse, if applicable) under the Pension Plan, calculated by ignoring
Section 401(a)(17) and 415 of the Code (and the Pension Plan provisions
implementing those Code Sections) and including in the definition of “Compensation”
payments made to a Participant pursuant to any “cash pay” annual performance incentive
plan of the Company (other than any extraordinary bonus, including any holiday,
year end, anniversary or signing bonus) and dividend equivalents paid in cash
to the Participant in connection with awards granted prior to 2006 under an
equity incentive plan of the Company, and


B equals the vested retirement benefit actually
payable under the Pension Plan, commencing on the date benefits commence under
the Pension Plan, and payable in the form of benefit elected by the Participant
(and spouse, if applicable) under the Pension Plan.”


SECOND:              With respect to Participants who
die on or after November 1, 2005, Section 4.6 is amended in its entirety
to provide as follows:


“4.6 — Spouse Pre-Retirement Death Benefit.


If a Participant’s spouse is entitled to a
pre-retirement death benefit under Section 4.12 of the Pension Plan, the
monthly benefit, if any, payable upon the death of a Participant to the
Participant’s spouse, commencing upon the date that monthly benefits to such
spouse commence under Section 4.12 of the Pension Plan and payable for the
period of such benefit is payable under the Pension Plan, shall be equal to the
excess, if any, of:











(a)           The
monthly death benefit determined in accordance with Section 4.12 of the Pension
Plan, calculated by ignoring Section 401(a)(17) and 415 of the Code (and the
Pension Plan provisions implementing those Code sections) and including in the
definition of “Compensation” payments made to a Participant pursuant to any “cash
pay” annual performance incentive plan of the Company (other than any
extraordinary bonus, including any holiday, year end, anniversary or signing
bonus) and dividend equivalents paid in cash to the Participant in connection
with awards granted under an equity incentive plan of the Company,


over


(b)           The amount of monthly spouse death
benefit payable to the Participant’s spouse pursuant to Section 4.12 of the
Pension Plan.”


	
  

  	
  Golden State Water Company

  
	
   

  	
   

  
	
   

  	
   

  
	
  Dated: November
  7, 2005

  	
  /s/ FLOYD E. WICKS

  	
   

  
	
   

  	
  President and Chief Executive Officer

  



 











SECOND
AMENDMENT

TO THE

SOUTHERN CALIFORNIA WATER COMPANY

PENSION RESTORATION PLAN


Effective as of
the dates set forth below, the Southern California Water Company Pension
Restoration Plan (the “Plan”) is amended to provide that:


FIRST:                   Effective
July 31, 2006, the name of the Plan is changed to the Golden State Water
Company Pension Restoration Plan.


SECOND:              Effective July 31, 2006,
Section 4.1 is amended in its entirety to provide as follows:


“4.1 — Retirement Benefit.


Subject to Section 4.3, a Participant’s retirement
benefit under this Plan shall equal the excess of (1) over (2) where:


(1) equals the Participant’s vested retirement benefit
under the Pension Plan, commencing on the date benefits commence under the
Pension Plan, and payable in the form of benefit elected by the Participant
(and spouse, if applicable) under the Pension Plan, calculated by (i) ignoring
Section 401(a)(17) and 415 of the Code (and the Pension Plan provisions
implementing those Code Sections); (ii) including in the definition of “Compensation”
payments made to a Participant pursuant to any “cash pay” annual performance
incentive plan of the Company (other than any extraordinary bonus, including
any holiday, year end, anniversary or signing bonus) and dividend equivalents
paid in cash to the Participant in connection with awards granted prior to 2006
under an equity incentive plan of the Company; and (iii) treating “A” in
Section 4.2 of the Pension Plan as equaling 2% per year of Credited Service
(including partial years) prior to 2006 (or, if later, the date the individual
becomes a Plan Participant) and 3% per year of Credited Service (including
partial years) after 2005 (or, if later, the date the individual becomes a Plan
Participant) up to a combined maximum of 60% for the total sum.  This modified formula is calculated as 2%
times X plus 3% times Y (up to a maximum of 60% for the total sum) minus Z
where X is the Participant’s years of Credited Service (including partial
years) before 2006 (or, if later, the date the individual becomes a Plan
Participant) and Y is the Participant’s years of Credited Service (including
partial years) after 2005 (or, if later, the date the individual becomes a Plan
Participant) and Z is the lesser of 1.67% of the Participant’s Old Age
Retirement Benefit (as defined in the Pension Plan) or 1% of Compensation times
the Participant’s years of Credited Service (including partial years); and











(2) equals the vested retirement benefit actually
payable under the Pension Plan, commencing on the date benefits commence under
the Pension Plan, and payable in the form of benefit elected by the Participant
(and spouse, if applicable) under the Pension Plan.


Notwithstanding the foregoing, with respect to Participants employed on
January 1, 2006, if greater, the amount under (1) above will equal the
Participant’s vested retirement benefit under the Pension Plan, (based on the
normal retirement benefit formula described in Section 4.2 of the Pension
Plan) commencing on the date benefits commence under the Pension Plan, and
payable in the form of benefit elected by the Participant (and spouse, if
applicable) under the Pension Plan, calculated by ignoring
Section 401(a)(17) and 415 of the Code (and the Pension Plan provisions
implementing those Code Sections) and including in the definition of “Compensation”
payments made to a Participant pursuant to any “cash pay” annual performance
incentive plan of the Company (other than any extraordinary bonus, including
any holiday, year end, anniversary or signing bonus) and dividend equivalents
paid in cash to the Participant in connection with awards granted prior to 2006
under an equity incentive plan of the Company.” 



THIRD:                  Effective
July 31, 2006, Section 4.6 is amended in its entirety to provide as follows:


“4.6 — Spouse Pre-Retirement Death Benefit.


If a Participant’s Spouse is entitled to a
pre-retirement death benefit under Section 4.12 of the Pension Plan, the
monthly benefit, if any, payable upon the death of a Participant to the
Participant’s spouse, commencing upon the date that monthly benefits to such
spouse commence under Section 4.12 of the Pension Plan and payable for the
period of such benefit is payable under the Pension Plan, shall be equal to the
excess, if any, of:


(1)           The
monthly death benefit determined in accordance with Section 4.12 of the Pension
Plan, calculated by (i) ignoring Section 401(a)(17) and 415 of the Code (and
the Pension Plan provisions implementing those Code sections); (ii) including
in the definition of “Compensation” payments made to a Participant pursuant to
any “cash pay” annual performance incentive plan of the Company (other than any
extraordinary bonus, including any holiday, year end, anniversary or signing
bonus) and dividend equivalents paid in cash to the Participant in connection
with awards granted prior to 2006 under an equity incentive plan of the
Company; and (iii) treating “A” in Section 4.2 of the Pension Plan as equaling
2% per year of Credited Service (including partial years) prior to 2006 (or, if
later, the date the individual becomes a Plan Participant) and 3% per year of
Credited Service (including partial years) after 2005 (or, if later, the date
the individual becomes a Plan Participant) up to a combined maximum of 60% for
the total sum.  This modified formula is
calculated as 2% times X plus 3% times 











Y (up to a maximum of 60% for the total sum) minus Z where X is the
Participant’s years of Credited Service (including partial years) before 2006
(or, if later, the date the individual becomes a Plan Participant) and Y is the
Participant’s years of Credited Service (including partial years) after 2005
(or, if later, the date the individual becomes a Plan Participant) and Z is the
lesser of 1.67% of the Participant’s Old Age Retirement Benefit (as defined in
the Pension Plan) or 1% of Compensation times the Participant’s years of
Credited Service (including partial years),


over


(2)           The
amount of monthly spouse death benefit payable to the Participant’s spouse
pursuant to Section 4.12 of the Pension Plan.


Notwithstanding the foregoing, with respect to
Participants employed on January 1, 2006, if greater, (1) above will equal
the monthly death benefit determined in accordance with Section 4.12 of the
Pension Plan, (based on the pre-retirement surviving spouse benefit described
in Section 4.12 of the Pension Plan), calculated by ignoring Section
401(a)(17) and 415 of the Code (and the Pension Plan provisions implementing
those Code sections) and including in the definition of “Compensation” payments
made to a Participant pursuant to any “cash pay” annual performance incentive
plan of the Company (other than any extraordinary bonus, including any holiday,
year end, anniversary or signing bonus) and dividend equivalents paid in cash
to the Participant in connection with awards granted prior to 2006 under an
equity incentive plan of the Company.”


	
  

  	
  Golden State Water Company

  
	
   

  	
   

  
	
   

  	
   

  
	
  Dated:

  	
   

  	
   

  	
  By:

  	
   

  
	
   

  	
  Name:

  	
   

  
	
   

  	
  Title: