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                                                                   EXHIBIT 10.16

           SOUTHERN CALIFORNIA WATER COMPANY PENSION RESTORATION PLAN



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                       SOUTHERN CALIFORNIA WATER COMPANY
                            PENSION RESTORATION PLAN
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                                TABLE OF CONTENTS


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                                                                                              Page
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ARTICLE I..................................................................................      1
        1.1 - Title........................................................................      1
        1.2 - Purpose......................................................................      1
        1.3 - Definitions..................................................................      1
ARTICLE II.................................................................................      2
        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.......................................................................      6
        5.3 - Binding Effect of Decisions..................................................      7
        5.4 - Indemnity....................................................................      7
        5.5 - Claim Procedure..............................................................      7
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
</TABLE>



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                        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.

1.3 - Definitions.



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               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.

                                   ARTICLE II
                                  PARTICIPATION



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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:



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        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



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the Participant's death) the monthly retirement benefit to which the Participant
is entitled under 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:



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        (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.

5.2 - Agents.



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        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.

5.5 - Claim Procedure.



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        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 benefit that would
be payable if the Participant terminated employment on the date of



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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.



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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



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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



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susceptible to more than one interpretation, such interpretation shall be given
thereto as 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.



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        IN WITNESS WHEREOF, the Company has caused these presents to be executed
by its duly authorized officers and the corporate seal to be hereunto affixed
this ____ day of ________________, 1997.

                                       SOUTHERN CALIFORNIA WATER COMPANY



                                       By ________________________________



                                       By ________________________________


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