SCI SYSTEMS, INC.
1994 STOCK OPTION INCENTIVE PLAN
SCI SYSTEMS, INC.
1994 STOCK OPTION INCENTIVE PLAN
TABLE OF CONTENTS
Page
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SECTION 1 DEFINITIONS..................................................................... 1
SECTION 2 THE STOCK INCENTIVE PLAN........................................................ 2
2.1 Purpose of the Plan......................................................... 2
2.2 Stock Subject to the Plan................................................... 2
2.3 Administration of the Plan.................................................. 2
2.4 Eligibility and Limits...................................................... 3
SECTION 3 TERMS OF STOCK OPTIONS GRANTED TO
EMPLOYEES AND OFFICERS......................................................... 3
3.1 Terms and Conditions of Options Granted to Employees and Officers........... 3
(a) Number of Option Shares.............................................. 3
(b) Stock Option Agreement............................................... 3
(c) Type of Option....................................................... 4
(d) Option Price......................................................... 4
(e) Option Term.......................................................... 4
(f) Payment.............................................................. 4
(g) Conditions to the Exercise of an Option.............................. 5
(h) Termination of Incentive Stock Option................................ 5
(i) Special Provisions for Certain Substitute Options.................... 5
(j) Date of Grant........................................................ 5
(k) Nonassignability..................................................... 5
3.2 Treatment of Awards Upon Termination of Employment.......................... 6
SECTION 4 TERMS OF STOCK OPTIONS GRANTED TO DIRECTORS...................................... 6
4.1 Number of Option Shares..................................................... 6
4.2 Stock Option Agreement...................................................... 6
4.3 Type of Option.............................................................. 6
4.4 Option Price................................................................ 6
4.5 Option Term................................................................. 6
4.6 Payment..................................................................... 7
4.7 Date of Grant............................................................... 7
4.8 Nonassignability............................................................ 7
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4.9 Cessation of Board Membership............................................... 7
4.10 Timing of Directions........................................................ 7
SECTION 5 RESTRICTIONS ON STOCK........................................................... 7
SECTION 6 GENERAL PROVISIONS.............................................................. 7
6.1 Withholding................................................................. 7
6.2 Changes in Capitalization; Merger; Liquidation.............................. 8
6.3 Cash Awards................................................................. 9
6.4 Compliance with Code........................................................ 9
6.5 Right to Terminate Employment............................................... 9
6.6 Non-alienation of Benefits.................................................. 9
6.7 Restrictions on Delivery and Sale of Shares; Legends........................ 9
6.8 Termination and Amendment of the Plan........................................ 9
6.9 Stockholder Approval........................................................ 10
6.10 Choice of Law............................................................... 10
6.11 Effective Date of Plan...................................................... 10
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SCI SYSTEMS, INC.
1994 STOCK OPTION INCENTIVE PLAN
SECTION I. DEFINITIONS
Whenever used herein, the masculine pronoun shall be deemed to include
the feminine, and the singular to include the plural, unless the context clearly
indicates otherwise, and the following capitalized words and phrases are used
herein with the meaning thereafter ascribed:
1.1 "Board" means the board of directors of the Company.
1.2 "Code" means the Internal Revenue Code of 1986, as amended.
1.3 "Committee" means the committee appointed by the Board to administer
the Plan.
1.4 "Company" means SCI Systems, Inc., a Delaware corporation.
1.5 "Director Fee" means fees payable for the performance of duties as a
director of the Company, but shall not include meeting or committee fees or
expense reimbursements paid to a director.
1.6 "Disposition" means any conveyance, sale, transfer, assignment,
pledge or hypothecation, whether outright or as security, inter vivos or
testamentary, with or without consideration, voluntary or involuntary.
1.7 "Exchange Act" means the Securities Exchange Act of 1934, as amended
from time to time.
1.8 "Exercise Price" means the price per share of Stock purchasable
under any Option.
1.9 "Fair Market Value" with regard to a date means the closing price at
which Stock shall have been sold on the last trading date prior to that date as
reported by the Nasdaq National Market System (or, if applicable, as reported by
a national securities exchange selected by the Committee on which the shares of
Stock are then actively traded) and published in The Wall Street Journal;
provided that, for purposes of granting Options other than incentive stock
options, Fair Market Value of the shares of Stock may be determined by the
Committee by reference to the average market value determined over a period
certain or as of specified dates, to a tender offer price for the shares of
Stock (if settlement of an award is triggered by such an event) or to any other
reasonable measure of fair market value.
1.10 "Option" means a non-qualified stock option or an incentive stock
option.
1.11 "Over 10% Owner" means an individual who at the time an incentive
stock option is granted owns Stock possessing more than 10% of the total
combined voting power of the Company or one of its Subsidiaries, determined by
applying the attribution rules of Code Section 424(d).
1.12 "Participant" means an individual who receives an Option hereunder.
1.13 "Plan" means the SCI Systems, Inc. 1994 Stock Option Incentive
Plan.
1.14 "Stock" means the Company's common stock, $0.10 par value.
1.15 "Stock Option Agreement" means an agreement between the Company and
a Participant or other documentation evidencing an award of an Option.
1.16 "Subsidiary" means any corporation (other than the Company) in an
unbroken chain of corporations beginning with the Company if, with respect to
incentive stock options, at the time of the granting of the Option, each of the
corporations other than the last corporation in the unbroken chain owns stock
possessing 50% or more of the total combined voting power of all classes of
stock in one of the other corporations in the chain.
SECTION 2 THE STOCK INCENTIVE PLAN
2.1 Purpose of the Plan. The Plan is intended to (a) provide incentive
to selected employees, officers and directors of the Company and its affiliates
to stimulate their efforts toward the continued success of the Company and to
operate and manage the business in a manner that will provide for the long-term
growth and profitability of the Company; (b) encourage stock ownership by
selected employees, officers and directors by providing them with a means to
acquire a proprietary interest in the Company, acquire shares of Stock, or to
receive compensation which is based upon appreciation in the value of Stock; and
(c) provide a means of obtaining, rewarding and retaining select employees,
officers and directors.
2.2 Stock Subject to the Plan. Subject to adjustment in accordance with
Section 5.2, 1,300,000 shares of Stock (the "Maximum Plan Shares", of which
302,974 shares are those which were released from reservation under the SCI
Systems, Inc. Non-Qualified Stock Option Plan and the SCI Systems, Inc.
Incentive Stock Option Plan immediately prior to adoption of this Plan), are
hereby reserved exclusively for issuance pursuant to Options. At no time shall
the Company have outstanding Options subject to Section 16 of the Exchange Act
and shares of Stock issued in respect of Options in excess of the Maximum Plan
Shares; for this purpose, the outstanding Options and shares of Stock issued in
respect of Options shall be computed consistent with Rule 16b-3(a)(1) as
promulgated under the Exchange Act. To the extent permitted by Rule 16b-3(a)(1)
as promulgated under the Exchange Act, the shares of Stock attributable to the
nonvested, unpaid, unexercised, unconverted or otherwise unsettled portion of
any Option that is forfeited or cancelled or expires or terminates for any
reason without becoming vested, paid, exercised, converted or otherwise settled
in full shall again be available for purposes of the Plan.
2.3 Administration of the Plan. The Plan shall be administered by the
Committee.
(a) With respect to awards under the Plan to key employees and
officers, the Committee shall be comprised solely of "disinterested
persons," as defined in Rule 16b-3 as promulgated under the Exchange
Act, who are then members of the Board. The Committee shall have full
authority in its discretion to determine the key employees and officers
of the
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Company or its affiliates to whom Options shall be granted and the terms
and provisions of such Options.
(b) Subject to the provisions of the Plan, the Committee shall
have full and conclusive authority to interpret the Plan; to prescribe,
amend and rescind rules and regulations relating to the Plan; to
determine the terms and provisions of the respective Stock Option
Agreements and to make all other determinations necessary or advisable
for the proper administration of the Plan. The Committee's
determinations under the Plan need not be uniform and may be made by it
selectively among persons who receive, or are eligible to receive,
awards under the Plan (whether or not such persons are similarly
situated). The Committee's decisions shall be final and binding on all
Participants.
2.4 Eligibility and Limits. Options may be granted only to employees,
officers and directors of the Company, or any affiliate of the Company;
provided, however, that directors who serve on the Committee shall not be
eligible to receive awards under Plan Section 3 that are subject to Section 16
of the Exchange Act while they are members of the Committee and that an
incentive stock option may only be granted to an employee of the Company or any
Subsidiary. In the case of incentive stock options, the aggregate Fair Market
Value (determined as at the date an incentive stock option is granted) of stock
with respect to which stock options intended to meet the requirements of Code
Section 422 become exercisable for the first time by an individual during any
calendar year under all plans of the Company and its Subsidiaries shall not
exceed $100,000; provided further, that if the limitation is exceeded, the
incentive stock option(s) which cause the limitation to be exceeded shall be
treated as non-qualified stock option(s).
SECTION 3 TERMS OF STOCK OPTIONS GRANTED TO
EMPLOYEES AND OFFICERS
3.1 Terms and Conditions of Options Granted to Employees and Officers.
No more than 1,200,000 shares of Stock shall be available for issuance as
Options to employees and officers under the Plan.
(a) Number of Option Shares. The number of shares of Stock as to
which an Option shall be granted pursuant to this Section 3 shall be
determined by the Committee in its sole discretion, subject to the
provisions of Section 2.2 as to the total number of shares available for
grants under the Plan. Notwithstanding the preceding, to the extent
required under Section 162(m) of the Code and the regulations thereunder
for compensation to be treated as qualified performance-based
compensation, the maximum number of shares of Stock with respect to
which Options may be granted during any one year period to any employee
shall not exceed 100,000.
(b) Stock Option Agreement. Each Option granted pursuant to this
Section 3 shall either be evidenced by a Stock Option Agreement in such
form and containing such terms, conditions and restrictions as the
Committee may determine to be appropriate. Each Stock Option Agreement
shall be subject to the terms of the Plan and any provisions contained
in the Stock Option Agreement that are inconsistent with the Plan shall
be null and void.
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(c) Type of Option. At the time any Option is granted pursuant
to this Section 3, the Committee shall determine whether the Option is
to be an incentive stock option described in Code Section 422 or a
non-qualified stock option, and the Option shall be clearly identified
as to its status as an incentive stock option or a non-qualified stock
option. At the time any incentive stock option granted under the Plan is
exercised, the Company shall be entitled to legend the certificates
representing the shares of Stock purchased pursuant to the Option to
clearly identify them as representing the shares purchased upon the
exercise of an incentive stock option. An incentive stock option may
only be granted within 10 years from the earlier of the date the Plan is
adopted or approved by the Company's stockholders.
(d) Option Price. Subject to adjustment in accordance with
Section 6.2 and the other provisions of this Section 3, the Exercise
Price under any Option shall be as set forth in the applicable Stock
Option Agreement. Notwithstanding the preceding, the Exercise Price
under any incentive stock option shall not be less than the Fair Market
Value on the date the Option is granted, and with respect to each grant
of an incentive stock option to a Participant who is an Over 10% Owner,
the Exercise Price shall not be less than 110% of the Fair Market Value
on the date the Option is granted.
(e) Option Term. Any incentive stock option granted to a
Participant who is not an Over 10% Owner shall not be exercisable after
the expiration of 10 years after the date the Option is granted. Any
incentive stock option granted to a Participant who is an Over 10% Owner
shall not be exercisable after the expiration of five years after the
date the Option is granted. The term of any non-qualified stock option
shall be as specified in the applicable Stock Option Agreement.
(f) Payment. Payment for all shares of Stock purchased pursuant
to the exercise of an Option granted pursuant to this Section 3 shall be
made in any form or manner authorized by the Committee in the Stock
Option Agreement, including, but not limited to, (i) cash, (ii) by
delivery to the Company of a number of shares of Stock which have been
owned by the holder for at least six months prior to the date of
exercise having an aggregate Fair Market Value of not less than the
product of the Exercise Price multiplied by the number of shares the
Participant intends to purchase upon exercise of the Option on the date
of delivery; (iii) in a cashless exercise through a broker; or (iv) by
having a number of shares of Stock withheld, the Fair Market Value of
which as of the date of exercise is sufficient to satisfy the Exercise
Price. In its discretion, the Committee also may authorize (at the time
an Option is granted or thereafter) Company financing to assist the
Participant as to payment of the Exercise Price on such terms as may be
offered by the Committee in its discretion. Any such financing shall
require the payment by the Participant of interest on the amount
financed at a rate not less than the "applicable federal rate" under the
Code. If a Stock Option Agreement so provides, the Participant may be
granted a new Option to purchase a number of shares of Stock equal to
the number of previously owned shares of Stock tendered in payment for
each share of Stock purchased pursuant to the terms of the Stock Option
Agreement. Any such new Option shall be subject to the terms and
conditions of the Stock Option Agreement pursuant to which such new
Option is granted. Payment of the Exercise Price shall be made at the
time that the Option or any part thereof is exercised, and no shares
shall be issued or
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delivered upon exercise of an Option until full payment has been made by
the Participant. The holder of an Option, as such, shall have none of
the rights of a stockholder.
(g) Conditions to the Exercise of an Option. Each Option granted
pursuant to this Section 3 shall be exercisable by whom, at such time or
times, or upon the occurrence of such event or events, and in such
amounts, as the Committee shall specify in the Stock Option Agreement;
provided, however, that subsequent to the grant of an Option, the
Committee, at any time before complete termination of such Option, may
accelerate the time or times at which such Option may be exercised in
whole or in part, and may permit the Participant or any other designated
person to exercise the Option, or any portion thereof, for all or part
of the remaining Option term, notwithstanding any provision of the Stock
Option Agreement to the contrary.
(h) Termination of Incentive Stock Option. With respect to an
incentive stock option, in the event of termination of employment of a
Participant for any reason other than death or disability, the Option or
portion thereof held by the Participant which is unexercised shall
expire, terminate, and become unexercisable no later than the expiration
of three months after the date of termination of employment; provided,
however, that in the case of a holder whose termination of employment is
due to death or disability, one year shall be substituted for such three
month period. For purposes of this Subsection (h), termination of
employment of the Participant shall not be deemed to have occurred if
the Participant is employed by another corporation (or a parent or
subsidiary corporation of such other corporation) which has assumed the
incentive stock option of the Participant in a transaction to which Code
Section 424(a) is applicable.
(i) Special Provisions for Certain Substitute Options.
Notwithstanding anything to the contrary in this Section 3, any Option
issued in substitution for an option previously issued by another
entity, which substitution occurs in connection with a transaction to
which Code Section 424(a) is applicable, may provide for an exercise
price computed in accordance with such Code Section and the regulations
thereunder and may contain such other terms and conditions as the
Committee may prescribe to cause such substitute Option to contain as
nearly as possible the same terms and conditions (including the
applicable vesting and termination provisions) as those contained in the
previously issued option being replaced thereby.
(j) Date of Grant. The date an Option is granted pursuant to
this Section 3 shall be the date on which the Committee has approved the
terms and conditions of the Option and has determined the recipient of
the Option and the number of shares covered by the Option and has taken
all such other action necessary to complete the grant of the Option.
(k) Nonassignability. Options granted pursuant to this Section 3
shall not be transferable or assignable except by will or by the laws of
descent and distribution. Such Options shall be exercisable, during the
Participant's lifetime, only by the Participant; or in the event of the
death of the Participant, by the legal representatives of the
Participant's estate or if no legal representative has been appointed,
by the successor in interest determined under the Participant's will.
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3.2 Treatment of Awards Upon Termination of Employment. Except as
otherwise provided by Plan Section 3.1(h), any award pursuant to this Section 3
to a Participant who has experienced a termination of employment may be
cancelled, accelerated, paid or continued, as provided in the applicable Stock
Option Agreement, or, in the absence of such provision, as the Committee may
determine. The portion of any award exercisable in the event of continuation or
the amount of any payment due under a continued award may be adjusted by the
Committee to reflect the Participant's period of service from the date of grant
through the date of the Participant's termination of employment or such other
factors as the Committee determines are relevant to its decision to continue the
award.
SECTION 4 TERMS OF STOCK OPTIONS GRANTED TO DIRECTORS
Each individual serving as a non-employee director of the Company as of
the effective date of the Plan may irrevocably direct that all or a portion of
his or her Director Fee for the remainder of the term for which he or she is
serving as a director be allocated to the purchase of Options on his or her
behalf. The direction shall be effective with respect to those Director Fees
payable after the expiration of six months following the Company's receipt of
the direction and must be made with respect to all or a portion (in 25%
increments) of each payment. Options granted under this Section 4 shall be
subject to the following terms and conditions:
4.1 Number of Option Shares. A Participant shall be granted an Option to
purchase that number of shares of Stock with an aggregate Fair Market Value
(determined as of the date of grant) equal to four times the amount of the
Director Fee which the Participant allocated to the purchase of Options.
4.2 Stock Option Agreement. Each Option shall be evidenced by a Stock
Option Agreement which shall incorporate the terms of the Plan.
4.3 Type of Option. Options shall be non-qualified stock options.
4.4 Option Price. The Exercise Price for a share of Stock subject to an
Option shall be the Fair Market Value (determined as of the date of grant) of a
share of Stock.
4.5 Option Term. Each Option may be exercised for that percentage of
shares of Stock subject to the Option as to which the Option has become vested,
reduced by that number of shares of Stock subject to the Option which have been
previously exercised. The Option shall vest in equal portions on each "Vesting
Date," provided that the Participant is still a director on the Vesting Date.
For purpose of this Section 4, the term Vesting Date shall mean the date of
grant and each Board meeting at which Director Fees are payable during the
remainder of the director's term, provided that Director Fees are paid on a
semi-annual basis. If Director Fees are no longer payable on a semi-annual
basis, then the term Vesting Date shall mean the date of grant and thereafter
any annual meeting of the Company's shareholders or any six month anniversary of
an annual meeting of the Company's shareholders occurring during the director's
term; provided that the next vesting date is no less than four months from any
other vesting date. Once exercisable, each Option granted hereunder shall remain
exercisable until the tenth anniversary of the date of grant; provided, however,
that in the event of a Participant's death prior to the expiration of any such
Option term, the Option may
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continue to be exercised by the Participant's legal representative until the
expiration of such Option term.
4.6 Payment. Payment for all shares of Stock purchased pursuant to the
exercise of an Option shall be made (i) in cash, (ii) by delivery to the Company
of a number of shares of Stock which have been owned by the holder for at least
six months prior to the date of exercise having an aggregate Fair Market Value
of not less than the product of the Exercise Price multiplied by the number of
shares the Participant intends to purchase upon exercise of the Option on the
date of delivery; or (iii) in a cashless exercise through a broker. The holder
of an Option, as such, shall have none of the rights of a stockholder.
4.7 Date of Grant. An Option shall be granted as of the date on which
the Director Fee is payable for which a direction is applicable.
4.8 Nonassignability. Options shall not be transferable or assignable
except by will or by the laws of descent and distribution. Such Options shall be
exercisable, during the Participant's lifetime, only by the Participant; or in
the event of the death of the Participant, by the legal representatives of the
Participant's estate or if no legal representative has been appointed, by the
successor in interest determined under the Participant's will.
4.9 Timing of Directions. Each non-employee director shall make a
direction pursuant to this Section 4 no later than 30 days following his or her
election, reelection or appointment to the Board; provided, however, that any
non-employee director who is a member of the Board as of the Plan's effective
date shall make such a direction no later than 30 days following the Plan's
effective date.
SECTION 5 RESTRICTIONS ON STOCK
The Participant shall not have the right to make or permit to exist any
Disposition of the shares of Stock issued pursuant to the Plan except as
provided in the Plan or the Stock Option Agreement. Any Disposition of the
shares of Stock issued under the Plan by the Participant not made in accordance
with the Plan or the Stock Option Agreement shall be void. The Company shall not
recognize, or have the duty to recognize, any Disposition not made in accordance
with the Plan and the Stock Option Agreement, and the shares so transferred
shall continue to be bound by the Plan and the Stock Option Agreement.
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SECTION 6 GENERAL PROVISIONS
6.1 Withholding. The Company shall deduct from all cash distributions
under the Plan any taxes required to be withheld by federal, state or local
government. Whenever the Company proposes or is required to issue or transfer
shares of Stock under the Plan, the Company shall have the right to require the
recipient to remit to the Company an amount sufficient to satisfy any federal,
state and local withholding tax requirements prior to the delivery of any
certificate or certificates for such shares. A Participant may pay the
withholding tax in cash, or, if the Stock Option Agreement provides, a
Participant may elect to have the number of shares of Stock he is to receive
reduced by the smallest number of whole shares of Stock which, when multiplied
by the Fair Market Value of the shares of Stock determined as of the Tax Date
(defined below), is sufficient to satisfy federal, state and local, if any,
withholding taxes arising from exercise of an Option (a "Withholding Election").
A Participant may make a Withholding Election only if both of the following
conditions are met:
(a) The Withholding Election must be made on or prior to the date
on which the amount of tax required to be withheld is determined (the
"Tax Date") by executing and delivering to the Company a properly
completed notice of Withholding Election as prescribed by the Committee;
and
(b) Any Withholding Election made will be irrevocable except on
six months advance written notice delivered to the Company; however, the
Committee may in its sole discretion disapprove and give no effect to
the Withholding Election.
6.2 Changes in Capitalization; Merger; Liquidation.
(a) The number of shares of Stock reserved for the grant of
Options; the number of shares of Stock reserved for issuance upon the
exercise or payment, as applicable, of each outstanding Option; and the
Exercise Price of each outstanding Option shall be proportionately
adjusted for any increase or decrease in the number of issued shares of
Stock resulting from a subdivision or combination of shares or the
payment of a stock dividend in shares of Stock to holders of outstanding
shares of Stock or any other increase or decrease in the number of
shares of Stock outstanding effected without receipt of consideration by
the Company.
(b) In the event of or anticipation of a merger, consolidation or
other reorganization of the Company or tender offer for shares of Stock,
the Committee may make such adjustments with respect to awards and take
such other action as it deems necessary or appropriate to reflect or
such merger, consolidation, reorganization or tender offer, including,
without limitation, the substitution of new awards, the termination or
adjustment of outstanding awards, the acceleration of awards or the
removal of restrictions on outstanding awards. Any adjustment pursuant
to this Section 6.2 may provide, in the Committee's discretion, for the
elimination without payment therefor of any fractional shares that might
otherwise become subject to any Option, but shall not otherwise diminish
the then value of the Option.
(c) The existence of the Plan and the Options granted pursuant to
the Plan shall not affect in any way the right or power of the Company
to make or authorize any adjustment, reclassification, reorganization or
other change in its capital or business structure, any merger
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or consolidation of the Company, any issue of debt or equity securities
having preferences or priorities as to the Stock or the rights thereof,
the dissolution or liquidation of the Company, any sale or transfer of
all or any part of its business or assets, or any other corporate act or
proceeding.
6.3 Cash Awards. The Committee may, at any time and in its discretion,
grant to any holder of an Option the right to receive, at such times and in such
amounts as determined by the Committee in its discretion, a cash amount which is
intended to reimburse such person for all or a portion of the federal, state and
local income taxes imposed upon such person as a consequence of the receipt of
the Option or the exercise of rights thereunder.
6.4 Compliance with Code. All incentive stock options to be granted
hereunder are intended to comply with Code Section 422, and all provisions of
the Plan and all incentive stock options granted hereunder shall be construed in
such manner as to effectuate that intent.
6.5 Right to Terminate Employment. Nothing in the Plan or in any Option
shall confer upon any Participant the right to continue as an employee, officer
or director of the Company or any of its affiliates or affect the right of the
Company or any of its affiliates to terminate the Participant's employment or
other relationship with the Company at any time.
6.6 Non-alienation of Benefits. Other than as specifically provided with
regard to the death of a Participant, no benefit under the Plan shall be subject
in any manner to anticipation, alienation, sale, transfer, assignment, pledge,
encumbrance or charge; and any attempt to do so shall be void. No such benefit
shall, prior to receipt by the Participant, be in any manner liable for or
subject to the debts, contracts, liabilities, engagements or torts of the
Participant.
6.7 Restrictions on Delivery and Sale of Shares; Legends. Each Option is
subject to the condition that if at any time the Committee, in its discretion,
shall determine that the listing, registration or qualification of the shares
covered by such Option upon any securities exchange or under any state or
federal law is necessary or desirable as a condition of or in connection with
the granting of such Option or the purchase or delivery of shares thereunder,
the delivery of any or all shares pursuant to such Option may be withheld unless
and until such listing, registration or qualification shall have been effected.
If a registration statement is not in effect under the Securities Act of 1933 or
any applicable state securities laws with respect to the shares of Stock
purchasable or otherwise deliverable under Options then outstanding, the
Committee may require, as a condition of exercise of any Option or as a
condition to any other delivery of Stock pursuant to an Option, that the
Participant or other recipient of an Option represent, in writing, that the
shares received pursuant to the Option are being acquired for investment and not
with a view to distribution and agree that the shares will not be disposed of
except pursuant to an effective registration statement, unless the Company shall
have received an opinion of counsel that such disposition is exempt from such
requirement under the Securities Act of 1933 and any applicable state securities
laws. The Company may include on certificates representing shares delivered
pursuant to an Option such legends referring to the foregoing representations or
restrictions or any other applicable restrictions on resale as the Company, in
its discretion, shall deem appropriate.
6.8 Termination and Amendment of the Plan. The Board at any time may
amend or terminate the Plan without stockholder approval; provided, however,
that the Board may condition
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any amendment on the approval of stockholders of the Company if such approval is
necessary or advisable with respect to tax, securities or other applicable laws.
No such termination or amendment without the consent of the holder of an Option
shall adversely affect the rights of the Participant under such Option.
6.9 Stockholder Approval. The Plan shall be submitted to the
stockholders of the Company for their approval within 12 months before or after
the adoption of the Plan by the Board. If such approval is not obtained, any
Option granted hereunder shall be void.
6.10 Choice of Law. The laws of the State of Alabama shall govern the
Plan, to the extent not preempted by federal law.
6.11 Effective Date of Plan. The Plan shall become effective as of the
date of its approval by the Board, subject, however, to the approval of the Plan
by the Company's shareholders at their next annual meeting. Options granted
hereunder prior to such shareholder approval shall be conditioned upon such
shareholder approval. Unless such shareholder approval is obtained by the first
anniversary of the Board's approval, this Plan and any Options awarded hereunder
shall become void thereafter.
SCI SYSTEMS, INC.
By: /s/ A. Eugene Sapp
---------------------------------
Title: President
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ATTEST:
By: Michael Sullivan
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Title: Secretary
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[CORPORATE SEAL]
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FIRST AMENDMENT TO
SCI SYSTEMS, INC.
1994 STOCK OPTION INCENTIVE PLAN
THIS FIRST AMENDMENT, made on this 28th day of October, 1996, by SCI
SYSTEMS, INC. (the "Company"), a corporation duly organized and existing under
the laws of the State of Delaware;
W I T N E S S E T H:
WHEREAS, the Company maintains the SCI Systems, Inc. 1994 Stock Option
Incentive Plan (the "Plan"); and
WHEREAS, the Company desires to amend the Plan to comply with the
provisions of Section 162(m) of the Internal Revenue Code of 1986, as amended
(the "Code"); and
NOW, THEREFORE, the Plan is hereby amended, as follows:
1. Effective as of January 1, 1994, by adding to the end of Section 2.4
the following:
"In no event shall any person be entitled to grants under the
Plan in any calendar year in excess of 100,000 shares."
2. Effective as of November 1, 1996, by deleting the first sentence of
Section 2.3(a) and replacing it with the following:
"With respect to awards under the Plan to key employees
and officers, the Committee shall be comprised solely of at least
two (2) members of Board of Directors. The Board of Directors
should consider the advisability of complying with the
disinterested standards contained in both Code Section 162(m) and
Rule 16b-3(b)(3) when appointing such Committee members.
Except as specifically amended hereby, the Plan shall remain in full
force and effect as prior to this First Amendment.
IN WITNESS WHEREOF, the Company has caused this First Amendment to be
executed on the day and year first above written.
SCI SYSTEMS, INC.
By: /s/ A. Eugene Sapp
---------------------------------
Title: President
------------------------------
ATTEST:
By: Michael Sullivan
----------------------------
Title: Secretary
-------------------------
[CORPORATE SEAL]
-2-
SECOND AMENDMENT TO THE
SCI SYSTEMS, INC.
1994 STOCK OPTION INCENTIVE PLAN
THIS SECOND AMENDMENT is made on the 1st day of November, 1998, by SCI
Systems, Inc., a Delaware corporation (the "Corporation").
INTRODUCTION
WHEREAS, the Corporation maintains the SCI Systems, Inc. 1994 Stock
Option Incentive Plan (the "Plan");
WHEREAS, the Plan currently has a limited number of shares of common
stock, par value $0.10 per share, of the Corporation's ("Common Stock")
available for issuance under the Plan, and as a result, the Corporation will
have insufficient shares of Common Stock available under the Plan to continue to
utilize the Plan as a component of compensation for qualified officers, key
employees and consultants; and
WHEREAS, the Corporation desires to amend the Plan to increase the
number of shares of Common Stock authorized for issuance under the Plan from
2,600,000 (adjusted to reflect a two-for-one stock adjustment to the number of
shares available for issuance by the Company whereby the number of shares of
Common Stock available for issuance under the Plan was increased from 1,300,000
to 2,600,000 shares pursuant to Section 6.2 of the Plan) to 4,600,000 shares.
AMENDMENT
NOW, THEREFORE, effective October 23, 1998 and subject to approval by
the holders of Common Stock, the first sentence of Section 2.2 of the Plan is
hereby amended and modified as follows:
"Subject to adjustment in accordance with Section 6.2, 4,600,000
shares of common stock (the "Maximum Plan Shares," of which
302,974 shares are those which were released from reservation
under the SCI systems, Inc. Non-Qualified Stock Option Plan and
the SCI Systems, Inc. Incentive Stock Option Plan immediately
prior to adoption of this Plan), are hereby reserved exclusively
for issuance pursuant to Options."
Except as specifically provided for herein, the Plan shall remain in
full force and effect as prior to this Second Amendment.
IN WITNESS WHEREOF, the parties hereto have caused this Second Amendment
to be executed as of the day and year first above written.
SCI SYSTEMS, INC.
By: /s/ A. Eugene Sapp
---------------------------------------
Title: President & Chief Executive Officer
ATTEST:
By: /s/ Michael Sullivan
----------------------------------
Title: Secretary & General Counsel
-------------------------------
[CORPORATE SEAL]
2