EXHIBIT 10.3
FIRST AMENDMENT TO
1994 STOCK OPTION PLAN FOR KEY EMPLOYEES
OF DAISYTEK INTERNATIONAL CORPORATION
1. In 1994, Daisytek International Corporation, a Delaware corporation
(the "Company"), adopted the 1994 Stock Option Plan For Key Employees of
Daisytek International Corporation (the "Plan"). The Company desires to amend
the Plan as set forth herein:
2. Section 2.3 of the Plan is hereby amended and restated to provide in
its entirety as follows:
"Section 2.3 - Changes in Company's Shares
In the event that the outstanding shares of Common Stock of
the Company are hereafter changed into or exchanged for a
different number or kind of shares or other securities of the
Company, or of another corporation, by reason of
reorganization, merger, consolidation, recapitalization,
reclassification, stock split-up, stock dividend or
combination of shares, appropriate adjustments shall be made
by the Committee in the number and kind of shares for the
purpose of which Options may be granted, including adjustments
of the limitations in Section 2.1 on the maximum number and
kind of shares which may be issued on exercise of Options."
3. Section 3.3 of the Plan is hereby amended and restated to provide in
its entirety as follows:
"Section 3.3 - Grant of Options
(a) Subject to the provisions hereof, the Committee shall from
time to time, in its absolute discretion:
(i) Determine which Employees are key Employees and
select from among the key Employees (including those
to whom Options have been previously granted under
the Plan or any other plan of the Company) such of
them as in its opinion should be granted Options; and
(ii) Determine the number of shares to be subject to
such Options granted to such selected key Employees,
and determine whether such Options are to be
Incentive Stock Options or Non-Qualified Options; and
(iii) Determine the terms and conditions of such
Options, consistent with the Plan.
(b) In selecting the key Employees to whom Options shall be
granted hereunder, the number of shares to be subject to such
Options and the terms and conditions of such Options, the
Committee shall have sole and absolute discretion and shall be
free to make non-uniform and selective determinations based
upon such factors as it deems relevant.
(c) Upon the selection of a key Employee to be granted an
Option, the Committee shall instruct the Secretary to issue
such Option and may impose such conditions on the grant of
such Option as it deems appropriate. Without limiting the
generality of the preceding sentence, the Committee may, in
its discretion and on such terms as it deems appropriate,
require as a condition to the grant of an Option to an
Employee that the Employee surrender for cancellation some or
all of the unexercised Options which have been previously
granted to the Employee. An Option the grant of which is
conditioned upon such surrender may have an option price lower
(or higher) than the option price of the surrendered Option,
may cover the same (or a lessor or greater) number of shares
as the surrendered Option, may contain such other terms as the
Committee deems appropriate and shall be exercisable in
accordance with its terms, without regard to the number of
shares, price, option period or any other term or condition of
the surrendered Option."
4. [SECTION 3.4 OF THE PLAN IS HEREBY DELETED IN ITS ENTIRETY.]
5. Section 4.3 of the Plan is hereby amended and restated to provide in
its entirety as follows:
"Section 4.3 - Commencement of Exercisability
(a) No Option may be exercised in whole or in part during the
six months after such Option is granted, except as otherwise
set forth herein.
(b) Each Option granted hereunder shall be subject to such
vesting schedule (which may be cumulative or non-cumulative),
conditions, restrictions and other provisions as the Committee
shall, in its sole and absolute discretion, deem necessary or
appropriate, which determinations may be non-uniform and
selective and based upon such factors as it deems relevant in
its sole and absolute discretion.
(c) Subject to the provisions hereof governing Incentive Stock
Options, the Committee shall have the right to accelerate the
vesting of any outstanding Option, or any portion thereof, at
any time and from time to time, and upon such terms and
conditions as it shall determine in its sole discretion.
(d) Notwithstanding any other provision of this Plan, to the
extent that the aggregate fair market value (determined at the
time the Incentive Stock Option is granted) of the shares of
the Company's stock with respect to
which "incentive stock options" (within the meaning of Section
422 of the Code) are exercisable by any Optionee for the first
time by such Optionee during any calendar year (under the Plan
and all other incentive stock option plans of the Company, any
Subsidiary and any Parent Corporation) exceeds $100,000, such
Options shall be treated as Non-Qualified Options. For
purposes of this Section, Options shall be taken into account
in the order in which they were granted.
(e) Notwithstanding the provisions of paragraph (a) above, the
Committee shall have the right to issue Options hereunder
which are immediately exercisable on the date of grant;
provided, however, that in such event, the shares of Common
Stock to be issued thereunder shall be subject to such
restrictions on transfer and forfeiture as the Committee
shall, in its sole discretion, deem appropriate, which
determinations may be non-uniform and selective and based upon
such factors as it deems appropriate in its sole discretion.
(f) Unless otherwise provided in the Stock Option Agreement
evidencing a grant of Options, upon the Termination of
Employment of the holder of an Option, such portion of such
Option which has not then vested and become exercisable shall
automatically terminate and expire and shall not vest or
become exercisable at any time thereafter."
6. Section 5.1 of the Plan, which was inadvertently numbered as Section
5.2 and is titled Person Eligible to Exercise is hereby amended and restated to
provide in its entirety as follows:
"Section 5.1 - Persons Eligible to Exercise
During the lifetime of the Optionee, only he may exercise an
Option (or any portion thereof) granted to him. After the
death of the Optionee, any exercisable portion of an Option
may, prior to the time when such portion becomes unexercisable
under the Plan or the applicable Stock Option Agreement, be
exercised by his personal representative or by any person
empowered to do so under the deceased Optionee's will or under
the then applicable laws of descent and distribution.
Notwithstanding the foregoing, the Committee may, in its sole
discretion, permit the transfer of any Non-Qualified Option,
in whole or in part, and the exercise thereof by any
transferee thereof."
7. The reference in the first sentence of Section 6.1 to "disinterested
person" shall be amended to read "non-employee director."
8. Section 7.1 is hereby amended to add to the end of the Section the
following sentence:
Notwithstanding the foregoing, the Committee may, in its sole
discretion, permit the holder of any Non-Qualified Option to
transfer such Option, or
any portion thereof, to such holder's spouse, lineal
descendant or trust established for the benefit thereof or any
other person or entity.
9. The remaining terms and provisions of the Plan shall continue in
full force and effect.
10. This First Amendment to the Plan was adopted by the Board of
Directors of the Company on August 2, 2001.