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Exhibit 10.44
SCG HOLDING CORPORATION
2000 STOCK INCENTIVE PLAN
NON-QUALIFIED STOCK OPTION AGREEMENT
FOR DIRECTORS
This Option Agreement is made and entered into by and between SCG HOLDING
CORPORATION ("Company") and XXXXXX X. XXXXX ("Optionee"), as of the 12th day of
May, 2000 ("Date of Grant").
RECITALS
A. The Board of Directors of the Company has adopted the SCG Holding
Corporation 2000 Stock Incentive Plan ("Plan") as an incentive to retain members
of the Board of Directors, key employees, officers, and consultants of the
Company and to enhance the ability of the Company to attract such individuals
whose services are considered unusually valuable by providing an opportunity for
them to have a proprietary interest in the success of the Company.
B. The Board has approved the granting of options to the Optionee pursuant
to the Plan to provide an incentive to the Optionee to focus on the long-term
growth of the Company.
In consideration of the mutual covenants and conditions hereinafter set
forth and for other good and valuable consideration, the receipt and sufficiency
of which are hereby acknowledged, the Company and the Optionee agree as follows:
1. GRANT OF OPTION. The Company hereby grants to the Optionee the
right and option (hereinafter referred to as the "Option") to purchase an
aggregate of 7,017 shares (such number being subject to adjustment as provided
in paragraph 11 hereof and Section 14 of the Plan) of the Common Stock of the
Company (the "Stock") on the terms and conditions herein set forth. This Option
may be exercised in whole or in part and from time to time as hereinafter
provided. The Option granted under this Agreement is NOT intended to be an
"incentive stock option" as set forth in Section 422 of the Internal Revenue
Code of 1986, as amended.
2. VESTING OF OPTION. The Option shall vest and become exercisable
in accordance with the schedule below:
- 33 1/3% of the Option grant shall become exercisable on May 12,
2001;
- an additional 33 1/3% of the Option grant shall become exercisable
on May 12, 2002; and
- the final 33 1/3% of the Option grant shall become exercisable on
May 12, 2003.
3. PURCHASE PRICE. The price at which the Optionee shall be entitled
to purchase the Stock covered by the Option shall be $21.375 per share.
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4. TERM OF OPTION. The Option granted under this Agreement shall
expire, unless otherwise exercised, ten years from the Date of Grant, through
and including the normal close of business of the Company on May 12, 2010
("Expiration Date"), subject to earlier termination as provided in paragraph 8
hereof.
5. EXERCISE OF OPTION. The Option may be exercised by the Optionee
as to all or any part of the Stock then vested by delivery to the Company of
written notice of exercise and payment of the purchase price as provided in
paragraphs 6 and 7 hereof.
6. METHOD OF EXERCISING OPTION. Subject to the terms and conditions
of this Option Agreement, the Option may be exercised by timely delivery to the
Company of written notice, which notice shall be effective on the date received
by the Company ("Effective Date"). The notice shall state the Optionee's
election to exercise the Option, the number of shares in respect of which an
election to exercise has been made, the method of payment elected (see paragraph
7 hereof), the exact name or names in which the shares will be registered and
the Social Security number of the Optionee. Such notice shall be signed by the
Optionee and shall be accompanied by payment of the purchase price of such
shares. In the event the Option shall be exercised by a person or persons other
than Optionee pursuant to paragraph 8 hereof, such notice shall be signed by
such other person or persons and shall be accompanied by proof acceptable to the
Company of the legal right of such person or persons to exercise the Option. All
shares delivered by the Company upon exercise of the Option shall be fully paid
and nonassessable upon delivery.
7. METHOD OF PAYMENT FOR OPTIONS. Payment for shares purchased upon
the exercise of the Option shall be made by the Optionee in cash,
previously-acquired Stock held for more than six months (through actual tender
or by attestation), broker-assisted cashless exercise arrangement, or such other
method permitted by the Board and communicated to the Optionee in writing prior
to the date the Optionee exercises all or any portion of the Option.
8. TERMINATION OF SERVICES.
8.1 GENERAL. If the Optionee ceases to perform services as
a member of the Board of Directors of the Company for any reason other than
death or Disability, then the Optionee may at any time within ninety (90) days
after the effective date of termination of services exercise the Option to the
extent that the Optionee was entitled to exercise the Option at the date of
termination, provided that the Option shall lapse immediately upon a
termination for Cause. In no event shall the Option be exercisable after the
Expiration Date. Any portion of the Option that is not vested on the date the
Optionee ceases to perform services as a Company Director, shall be forfeited
on such date.
8.2 DEATH OR DISABILITY OF OPTIONEE. In the event of the
death or Disability (as that term is defined in the Plan) of the Optionee
within a period during which the Option, or any part thereof, could have been
exercised by the Optionee, including ninety (90) days after termination of
services (the "Option Period"), the Option shall lapse unless it is exercised
within the Option Period and in no event later than twelve (12) months after
the date of the Optionee's death or Disability by the Optionee or the
Optionee's legal representative or representatives in the case of a Disability
or, in the case of death, by the person or persons
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entitled to do so under the Optionee's last will and testament or if the
Optionee fails to make a testamentary disposition of such Option or shall die
intestate, by the person or persons entitled to receive such Option under the
applicable laws of descent and distribution. An Option may be exercised
following the death or Disability of the Optionee only if the Option was
exercisable by the Optionee immediately prior to his death or Disability. In no
event shall the Option be exercisable after the Expiration Date. The Board shall
have the right to require evidence satisfactory to it of the rights of any
person or persons seeking to exercise the Option under this paragraph 8 to
exercise the Option.
9. NONTRANSFERABILITY. The Option granted by this Option Agreement
shall be exercisable only during the term of the Option provided in paragraph 4
hereof and, except as provided in paragraph 8 above, only by the Optionee during
his lifetime and while a Director of the Company. Except as otherwise permitted
by the Committee, this Option shall not be transferable by the Optionee or any
other person claiming through the Optionee, either voluntarily or involuntarily,
except by will or the laws of descent and distribution.
10. MARKET STAND-OFF AGREEMENT. The Optionee, if requested by the
Company and an underwriter of Stock (or other securities) of the Company, agrees
not to sell or otherwise transfer or dispose of any Stock (or other securities)
of the Company held by the Optionee during the period not to exceed 180 days as
requested by the managing underwriter following the effective date of a
registration statement of the Company filed under the Securities Act. Such
agreement shall be in writing in a form satisfactory to the Company and such
underwriter. The Company may impose stop transfer instructions with respect to
the Stock (or other securities) subject to the foregoing restriction until the
end of such project.
11. ADJUSTMENTS IN NUMBER OF SHARES AND OPTION PRICE. In the event
of a stock dividend or in the event the Stock shall be changed into or exchanged
for a different number or class of shares of stock of the Company or of another
corporation, whether through reorganization, recapitalization, stock split-up,
combination of shares, merger or consolidation, there shall be substituted for
each such remaining share of Stock then subject to this Option the number and
class of shares of stock into which each outstanding share of Stock shall be so
exchanged, all without any change in the aggregate purchase price for the shares
then subject to the Option, all as set forth in Section 14 of the Plan.
12. DELIVERY OF SHARES. No shares of Stock shall be delivered upon
exercise of the Option until (i) the purchase price shall have been paid in full
in the manner herein provided; (ii) applicable taxes required to be withheld
have been paid or withheld in full; (iii) approval of any governmental authority
required in connection with the Option, or the issuance of shares thereunder,
has been received by the Company; and (iv) if required by the Board, the
Optionee has delivered to the Board an Investment Letter in form and content
satisfactory to the Company as provided in paragraph 13 hereof.
13. SECURITIES ACT. The Company shall not be required to deliver any
shares of Stock pursuant to the exercise of all or any part of the Option if, in
the opinion of counsel for the Company, such issuance would violate the
Securities Act of 1933 or any other applicable federal or state securities laws
or regulations. The Board may require that the Optionee, prior to the issuance
of any such shares pursuant to exercise of the Option, sign and deliver to the
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Company a written statement ("Investment Letter") stating (i) that the Optionee
is purchasing the shares for investment and not with a view to the sale or
distribution thereof; (ii) that the Optionee will not sell any shares received
upon exercise of the Option or any other shares of the Company that the Optionee
may then own or thereafter acquire except either (a) through a broker on a
national securities exchange or (b) with the prior written approval of the
Company; and (iii) containing such other terms and conditions as counsel for the
Company may reasonably require to assure compliance with the Securities Act of
1933 or other applicable federal or state securities laws and regulations. Such
Investment Letter shall be in form and content acceptable to the Board in its
sole discretion.
14. DEFINITIONS; COPY OF PLAN. To the extent not specifically
provided herein, all capitalized terms used in this Option Agreement shall have
the same meanings ascribed to them in the Plan. By the execution of this
Agreement, the Optionee acknowledges receipt of a copy of the Plan.
15. ADMINISTRATION. This Option Agreement shall at all times be
subject to the terms and conditions of the Plan and the Plan shall in all
respects be administered by the Board in accordance with the terms of and as
provided in the Plan. The Board shall have the sole and complete discretion with
respect to all matters reserved to it by the Plan and decisions of the majority
of the Board with respect thereto and to this Option Agreement shall be final
and binding upon the Optionee and the Company. In the event of any conflict
between the terms and conditions of this Option Agreement and the Plan, the
provisions of the Plan shall control.
16. CONTINUATION OF SERVICES. This Option Agreement shall not be
construed to confer upon the Optionee any right to continue providing services
as a Company Director and shall not limit the right of the Company, in its sole
discretion, to terminate the services of the Optionee at any time.
17. OBLIGATION TO EXERCISE. The Optionee shall have no obligation to
exercise any option granted by this Agreement.
18. GOVERNING LAW. This Option Agreement shall be interpreted and
administered under the laws of the State of Delaware.
19. AMENDMENTS. This Option Agreement may be amended only by a
written agreement executed by the Company and the Optionee. The Company and the
Optionee acknowledge that changes in federal tax laws enacted subsequent to the
Date of Grant, and applicable to stock options, may provide for tax benefits to
the Company or the Optionee. In any such event, the Company and the Optionee
agree that this Option Agreement may be amended as necessary to secure for the
Company and the Optionee any benefits that may result from such legislation. Any
such amendment shall be made only upon the mutual consent of the parties, which
consent (of either party) may be withheld for any reason.
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IN WITNESS WHEREOF, the Company has caused this Option Agreement to be
signed by its duly authorized representative and the Optionee has signed this
Option Agreement as of the date first written above.
SCG HOLDING CORPORATION OPTIONEE/XXXXXX X. XXXXX
By: /s/ Xxxxxx X. Xxxx /s/ Xxxxxx X. Xxxxx
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Its: Vice President & Secretary
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