SCE Trust I, a Delaware statutory trust subsidiary of ours, will issue the 5.625% Trust Preference Securities, which we refer to herein as the “Trust Preference Securities.” Each Trust Preference Security represents an undivided beneficial interest in the assets of SCE Trust I. The only assets of SCE Trust I will be the shares of our Series F Preference Stock, which have substantially the same payment terms as the Trust Preference Securities and which we refer to herein as the “Series F Preference Shares.” SCE Trust I can make distributions on the Trust Preference Securities only if we make dividend payments on the Series F Preference Shares. We will pay dividends on the Series F Preference Shares when, as, and if declared by our board of directors or a duly authorized committee of the board.
Distributions are payable quarterly in arrears, on March 15, June 15, September 15 and December 15 of each year, beginning on September 15, 2012, at an annual rate of 5.625%. SCE Trust I will pay distributions on the Trust Preference Securities only from the proceeds, if any, of dividends it receives from us on the Series F Preference Shares. Distributions on the Trust Preference Securities, and dividends on the Series F Preference Shares, will be cumulative from May 17, 2012.
Neither the Trust Preference Securities nor the Series F Preference Shares have a maturity date. At our option, at any time, or from time to time, on or after June 15, 2017, we may redeem the Series F Preference Shares, in whole or in part, at 100% of their liquidation preference, plus accrued and unpaid dividends, if any. In addition, the Series F Preference Shares may be redeemed, in whole, but not in part, at any time prior to June 15, 2017 if certain changes in tax or investment company law or interpretation occur and certain other conditions are satisfied. Upon any redemption of the Series F Preference Shares, a corresponding amount of Trust Preference Securities will be redeemed.
The Series F Preference Shares will rank equally with other series of our preference stock, including our outstanding Series A, B, C, D and E Preference Stock, junior to our cumulative preferred stock and our secured and unsecured debt, and senior to our common stock. The Trust Preference Securities will effectively have the same ranking as the Series F Preference Shares as described in this prospectus.
We will guarantee the Trust Preference Securities to the extent described in this prospectus.