SEMPRA ENERGY 2008 LONG TERM INCENTIVE PLAN {YEAR} NONQUALIFIED STOCK OPTION AGREEMENT

You have been granted an option to purchase the number of shares of Sempra Energy Common Stock set forth below.  

The terms and conditions of your option are set forth in the attached Year {YEAR} Nonqualified Stock Option Agreement and in the Sempra Energy 2008 Long Term Incentive Plan, which is enclosed.  The summary below highlights selected terms and conditions but it is not complete and you should carefully read the attachments to fully understand the terms and conditions of your grant.

SUMMARY

Date of Option Grant:

Name of Optionee:

Optionee’s Employee Number:

Number of Shares of Sempra Energy Common Stock Covered by Option:

Exercise Price per Share:

Vesting:
Your option vests (becomes exercisable) in __ equal annual cumulative installments of __% each over a __-year period.  Once an installment becomes exercisable, it will remain exercisable until it is exercised or your option expires or terminates.

Option Term:
__ years subject to earlier expiration if your employment terminates.

Termination of Employment:
Your option may expire or cease to vest if your employment is terminated.

No Dividend Equivalents:
No dividend equivalents will be paid by the Company with respect to your option or the shares covered by your option.

Exercise of Option/Taxes:
Upon exercise of your option you must pay (or make acceptable arrangements to pay) the exercise price for each share for which you exercise your option and any withholding taxes that may be due as a result of exercise.  

To accept your grant you must sign this page and promptly return it to Sempra Energy.   By doing so, you agree to all of the terms and conditions described in the attached Year {YEAR} Nonqualified Stock Option Agreement and in the Sempra Energy 2008 Long Term Incentive Plan.

Recipient:

X

(Signature)

Sempra Energy:

/S/ Donald E. Felsinger

(Signature)

Title:

Chairman & Chief Executive Officer

Company

“Company” as used in this agreement refers to your employer, which may be Sempra Energy or a subsidiary of Sempra Energy.

Vesting

Your option vests (becomes exercisable) in equal annual cumulative installments over a ___-year period.  Each installment is __% of the original number of shares covered by your option and an installment vests on each of the first ___ anniversaries of the Date of Option Grant shown on the cover sheet.  Once an installment of your option becomes exercisable, it will remain exercisable until it is exercised or your option expires.

No Dividend Equivalents

No dividend equivalents will be paid by the Company with respect to your option or the shares covered by your option.

Term

Your option will expire at the close of business at Sempra Energy head­quarters on the day before the __th anniversary of the Date of Option Grant shown on the cover sheet, and is subject to earlier expiration (as described below) if your employment with the Company terminates.

Termination of Employment

If your employment with the Company terminates for any reason (other than under the circumstances set forth below), your option will expire at the close of business at Sempra Energy headquarters on the __th day after the date your employment terminated or upon the earlier expiration of the ten-year term of your option.  Your option will not continue to vest after your employment terminates and will be exercisable only as to the number of shares for which it was exercisable on the date of your employment terminated.

If your employment terminates for any reason (including as a result of your death or total and permanent disability) after you have attained age __ and at the time your employment terminated you had completed ___ years of continuous service, your option will expire at the close of business at Sempra Energy headquarters on the date ___ years (___ years if you have attained age ___) after the date your employment terminated or upon the earlier expiration of the ten-ye