Exhibit 4.3
SOUTHWEST GAS CORPORATION
1996 STOCK INCENTIVE PLAN
INCENTIVE STOCK OPTION AGREEMENT
THIS AGREEMENT dated as of the ______ day of
___________, ________ between Southwest Gas Corporation, a
California corporation (the "Corporation"), and
________________________________(the "Employee").
W I T N E S S E T H
-------------------
WHEREAS, pursuant to the Southwest Gas Corporation 1996
Stock Incentive Plan (the "Plan"), the Corporation has granted to
the Employee effective as of the ______ day of ___________,______
(the "Option Date") an option to purchase all or any part of
_________________ authorized but unissued of Common Stock, par
value $1.00 per share, of the Corporation upon the terms and
conditions set forth herein and in the Plan.
NOW, THEREFORE, in consideration of the mutual promises
and covenants made herein and the mutual benefits to be derived
herefrom, the parties agree as follows:
1. DEFINED TERMS. Capitalized terms used herein and
not otherwise defined herein shall have the meaning assigned to
such terms in the Plan.
2. GRANT OF OPTION. This Agreement evidences the
Corporation's grant to the Employee of the right and option to
purchase, on the terms and conditions set forth herein and in the
Plan, all or any part of an aggregate of _______ shares of the
Common Stock at the price of $______ per share (the "Option"),
exercisable from time to time, subject to the provisions of this
Agreement and the Plan, prior to the close of business on the day
before the tenth anniversary of the Option Date (the "Expiration
Date"). Such price equals the Fair Market Value of the
Corporation's Common Stock as of the Option Date. It is the
intent of the Corporation that this Option constitute an
incentive stock option within the meaning of Section 422 of the
Internal Revenue Code of 1986, as amended ("Code").
3. EXERCISABILITY OF OPTION. Except as earlier
permitted by or pursuant to the Plan or by resolution of the
Committee adopted AFTER the date hereof, no shares may be
purchased by exercise of the Option until the expiration of
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six months after the Option Date. [ALTERNATIVE 1: The Option may be
exercised in installments as to __% of the aggregate number of
shares set forth in Section 2 hereof (subject to adjustment) on
and after the first anniversary of the Option Date and as to an
additional __% of such aggregate number of such shares (subject
to adjustment) on each of the second, ____, _____ anniversaries
of the Option Date.] [ALTERNATIVE 2: After such date, the
Option may be exercised in whole or in part, from time to time,
until its expiration or earlier termination.]
To the extent the Employee does not in any year
purchase all or any part of the shares to which the Employee is
entitled, the Employee has the right cumulatively thereafter to
purchase any shares not so purchased and such right shall
continue until the Option terminates or expires. Fractional
share interests shall be disregarded, but may be cumulated. No
fewer than [100] shares may be purchased at any one time, unless
the number purchased is the total number at the time available
for purchase under the Option.
4. LIMITATION ON EXERCISE OF OPTION. In the event
the Employee is granted incentive stock options (whether under
this Agreement or any other incentive stock option agreement) and
the aggregate fair market value (determined as of the respective
dates of grant of such options) of the Common Stock with respect
to which such options are first exercisable in any calendar year
exceeds $100,000, the most recently granted options shall be
treated as nonqualified stock options to the extent of the
excess. In addition, in the case of simultaneously granted
options, the Corporation may, in the manner and to the extent
permitted by law, designate which shares are to be treated as
stock acquired pursuant to the exercise of an incentive stock
option.
5. METHOD OF EXERCISE OF OPTION. The Option shall be
exercisable by the delivery to the Corporation of a written
notice stating the number of shares to be purchased pursuant to
the Option and accompanied by payment made in accordance with and
in a form permitted in Section 2.2 of the Plan for the full
purchase price of the shares to be purchased, subject to such
further limitations and rules or procedures as the Committee may
from time to time establish as to any non-cash payment and as to
the tax withholding requirements of Section 3.5 of the Plan.
Shares delivered in payment of the exercise price must have been
owned by the Employee for at least six months prior to the
exercise. In addition, the Employee (or the Employee's
Beneficiary or Personal Representative) shall furnish any written
statements required pursuant to Section 3.4 of the Plan.
6. EFFECT OF TERMINATION OF EMPLOYMENT OR DEATH;
CHANGE IN SUBSIDIARY STATUS. The option and all other
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rights hereunder, to the extent not exercised, shall
terminate and become null and void at such time as the
Employee ceases to be employed by either the Corporation
or any Subsidiary, except that
(a) if the Employee terminates by reason other
than by death, Total Disability (as defined in subsection
(b) below) or for Cause (as defined below and as determined
by the Committee in its sole discretion), the Employee may
at any time within a period of three months after such
termination exercise the Option to the extent the Option was
exercisable at the date of such termination;
(b) if the Employee terminates by reason of
becoming Totally Disabled (within the meaning of Code
Section 22(e)(3) or as otherwise defined by the Committee),
or if the Employee becomes Totally Disabled within three
months after a termination described in subsection (a), then
the Option may be exercised within a period of 12 months
after the Employee becomes Totally Disabled (or, if earlier,
the Employee's termination from employment), to the extent
that the Option was exercisable on such date; and
(c) if the Employee dies prior to a termination
of employment, or within three months after a termination of
employment under subsection (a) or (b) above, then the
Option may be exercised within a period of one year after
the Employee's termination from employment, to the extent
that the Option was exercisable on such date;
provided, however, that in no event may the Option be exercised
by anyone under this Section or otherwise after the Expiration
Date. If the Employee is employed by an entity which ceases to
be a Subsidiary, such event shall be deemed for purposes of this
Section 6 to be a termination of employment described in
subsection (a) in respect of the Employee. Absence from work
caused by military service or authorized sick leave shall not be
considered as a termination of employment for purposes of this
Section.
For purposes of this Agreement, "Cause" means that the
Committee, acting in good faith, determines that the Employee
has: (a) committed a material breach of the Employee's duties
and responsibilities (other than as a result of incapacity due to
a Total Disability); or (b) been convicted of a felony, or
entered a plea of guilty or nolo contendere with respect to such
a crime; or (c) violated any fiduciary duty or duty of loyalty
owed to the Corporation; or (d) been generally incompetent or
grossly negligent in the discharge of the Employee's duties and
responsibilities; or (e) engaged or is engaging in immoderate use
of alcoholic beverages or narcotics or other substance abuse; or (f)
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violated any of the Corporation's established employment
policies in effect from time to time.
7. TERMINATION OF OPTION UNDER CERTAIN EVENTS. As
permitted by Section 3.2(c) of the Plan, the Committee retains
the right to terminate the Option to the extent not previously
exercised upon an event or transaction which the Corporation does
not survive.
8. NON-TRANSFERABILITY OF OPTION. The Option and any
other rights of the Employee under this Agreement or the Plan are
nontransferable as provided in Section 1.8 of the Plan.
9. NOTICES. Any notice to be given under the terms
of this Agreement shall be in writing and addressed to the
Corporation at its principal office located at 5241 Spring
Mountain Road, X.X. Xxx 00000, Xxx Xxxxx, Xxxxxx 00000-0000, to
the attention of the Corporate Secretary and to the Employee at
the address given beneath the Employee's signature hereto, or at
such other address as either party may hereafter designate in
writing to the other.
10. PLAN. The Option and all rights of the Employee
thereunder are subject to, and the Employee agrees to be bound
by, all of the terms and conditions of Articles 1, 2, 3, and 4 of
the Plan, incorporated herein by this reference, to the extent
such provisions are applicable to options granted to Eligible
Employees. The Employee acknowledges receipt of a copy of the
Plan, which is made a part hereof by this reference, and agrees
to be bound by the terms thereof. Unless otherwise expressly
provided in other Sections of this Agreement, provisions of the
Plan that confer discretionary authority on the Committee do not
(and shall not be deemed to) create any rights in the Employee
unless such rights are expressly set forth herein or are
otherwise in the sole discretion of the Committee so conferred by
appropriate action of the Committee under the Plan after the date
hereof.
11. NOTICE OF DISPOSITION. The Employee agrees to
notify the Corporation of any sale or other disposition of any
shares of Common Stock received upon exercise of the Option, if
such sale or disposition occurs within two years after the Option
Date or within one year after the date of such exercise.
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IN WITNESS WHEREOF, the Corporation has caused this
Agreement to be executed on its behalf by a duly authorized
officer and the Employee has hereunto set his or her hand.
SOUTHWEST GAS CORPORATION
(a California corporation)
By_________________________
Title______________________
EMPLOYEE
___________________________
(Signature)
___________________________
(Print Name)
___________________________
(Address)
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___________________________
(City, State, Zip Code)
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CONSENT OF SPOUSE
------------------
In consideration of the execution of the foregoing Incentive
Stock Option Agreement by Southwest Gas Corporation,
I,___________________________, the spouse of the Employee herein
named, do hereby join with my spouse in executing the foregoing
Incentive Stock Option Agreement and do hereby agree to be bound
by all of the terms and provisions thereof and of the Plan.
DATED: ____________, _____. _____________________________
Signature of Spouse
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