Exhibit 10.22
BELL MICROPRODUCTS INC.
1998 STOCK PLAN
(AS AMENDED THROUGH AUGUST 1, 2007)
     1. Purposes of the Plan. The purposes of this Stock Plan are:

  •   to attract and retain the best available personnel for positions of
substantial responsibility,     •   to provide additional incentive to
Employees, Directors and Consultants, and     •   to promote the success of the
Company’s business.

     Options granted under the Plan may be Incentive Stock Options or
Nonstatutory Stock Options, as determined by the Administrator at the time of
grant. Stock Purchase Rights may also be granted under the Plan. The Plan also
provides for automatic grants of Nonstatutory Stock Options to Outside
Directors.
     2. Definitions. As used herein, the following definitions shall apply:
          (a) “Administrator” means the Board or any of its Committees as shall
be administering the Plan, in accordance with Section 4 of the Plan.
          (b) “Applicable Laws” means the requirements relating to the
administration of stock option plans under U. S. state corporate laws, U.S.
federal and state securities laws, the Code, any stock exchange or quotation
system on which the Common Stock is listed or quoted and the applicable laws of
any foreign country or jurisdiction where Options or Stock Purchase Rights are,
or will be, granted under the Plan.
          (c) “Board” means the Board of Directors of the Company.
          (d) “Code” means the Internal Revenue Code of 1986, as amended.
          (e) “Committee” means a committee of Directors appointed by the Board
in accordance with Section 4 of the Plan.
          (f) “Common Stock” means the common stock of the Company.
          (g) “Company” means Bell Microproducts Inc., a California corporation.
          (h) “Consultant” means any person, including an advisor, engaged by
the Company or a Parent or Subsidiary to render services to such entity.
          (i) “Director” means a member of the Board.

 

--------------------------------------------------------------------------------

 

          (j) “Disability” means total and permanent disability as defined in
Section 22(e)(3) of the Code.
          (k) “Employee” means any person, including Officers and Directors,
employed by the Company or any Parent or Subsidiary of the Company. A Service
Provider shall not cease to be an Employee in the case of (i) any leave of
absence approved by the Company or (ii) transfers between locations of the
Company or between the Company, its Parent, any Subsidiary, or any successor.
For purposes of Incentive Stock Options, no such leave may exceed ninety days,
unless reemployment upon expiration of such leave is guaranteed by statute or
contract. If reemployment upon expiration of a leave of absence approved by the
Company is not so guaranteed, on the 181st day of such leave any Incentive Stock
Option held by the Optionee shall cease to be treated as an Incentive Stock
Option and shall be treated for tax purposes as a Nonstatutory Stock Option.
Neither service as a Director nor payment of a director’s fee by the Company
shall be sufficient to constitute “employment” by the Company.
          (l) “Exchange Act” means the Securities Exchange Act of 1934, as
amended.
          (m) “Fair Market Value” means, as of any date, the value of Common
Stock determined as follows:
               (i) If the Common Stock is listed on any established stock
exchange or a national market system, including without limitation the Nasdaq
Stock Market, its Fair Market Value shall be the closing sales price for such
stock (or the closing bid, if no sales were reported) as quoted on such exchange
or system on the date of determination (or for the next market trading day after
the date of determination in the event that such date is not a market trading
day), as reported in The Wall Street Journal or such other source as the
Administrator deems reliable;
               (ii) If the Common Stock is regularly quoted by a recognized
securities dealer but selling prices are not reported, the Fair Market Value of
a Share of Common Stock shall be the mean between the high bid and low asked
prices for the Common Stock on the date of determination (or for the next market
trading day after the date of determination in the event that such date is not a
market trading day), as reported in The Wall Street Journal or such other source
as the Administrator deems reliable; or
               (iii) In the absence of an established market for the Common
Stock, the Fair Market Value shall be determined in good faith by the
Administrator.
          (n) “Incentive Stock Option” means an Option intended to qualify as an
incentive stock option within the meaning of Section 422 of the Code and the
regulations promulgated thereunder.
          (o) “Inside Director” means a Director who is an Employee.
          (p) “Nonstatutory Stock Option” means an Option not intended to
qualify as an Incentive Stock Option.

- 2 -

--------------------------------------------------------------------------------

 

          (q) “Notice of Grant” means a written or electronic notice evidencing
certain terms and conditions of an individual Option or Stock Purchase Right
grant. The Notice of Grant is part of the Option Agreement.
          (r) “Officer” means a person who is an officer of the Company within
the meaning of Section 16 of the Exchange Act and the rules and regulations
promulgated thereunder.
          (s) “Option” means a stock option granted pursuant to the Plan.
          (t) “Option Agreement” means an agreement between the Company and an
Optionee evidencing the terms and conditions of an individual Option grant. The
Option Agreement is subject to the terms and conditions of the Plan.
          (u) “Option Exchange Program” means a program whereby outstanding
Options are surrendered in exchange for Options with a lower exercise price.
          (v) “Optioned Stock” means the Common Stock subject to an Option or
Stock Purchase Right.
          (w) “Optionee” means the holder of an outstanding Option or Stock
Purchase Right granted under the Plan.
          (x) “Outside Director” means a Director who is not an Employee.
          (y) “Parent” means a “parent corporation,” whether now or hereafter
existing, as defined in Section 424(e) of the Code.
          (z) “Plan” means this 1998 Stock Plan.
          (aa) “Restricted Stock” means shares of Common Stock awarded or
acquired pursuant to a grant of Stock Purchase Rights under Section 11 of the
Plan.
          (bb) “Restricted Stock Purchase Agreement” means a written agreement
between the Company and the Optionee evidencing the terms and restrictions
applying to Common Stock purchased or awarded under a Stock Purchase Right. The
Restricted Stock Agreement is subject to the terms and conditions of the Plan
and the Notice of Grant.
          (cc) “Rule 16b-3” means Rule 16b-3 of the Exchange Act or any
successor to Rule 16b-3, as in effect when discretion is being exercised with
respect to the Plan.
          (dd) “Section 16(b)” means Section 16(b) of the Exchange Act.
          (ee) “Service Provider” means an Employee, Director or Consultant.
          (ff) “Share” means a share of the Common Stock, as adjusted in
accordance with Section 13 of the Plan.

- 3 -

--------------------------------------------------------------------------------

 

          (gg) “Stock Purchase Right” means the right to purchase or an award of
Restricted Stock or the right to acquire shares of Common Stock through
Restricted Stock Units granted pursuant to Section 11 of the Plan, as evidenced
by a Notice of Grant.
          (hh) “Subsidiary” means a “subsidiary corporation”, whether now or
hereafter existing, as defined in Section 424(f) of the Code.
          (ii) “Restricted Stock Unit” means the right to receive a share of
Common Stock awarded or acquired pursuant to a grant of Stock Purchase Rights
under Section 11 of the Plan.
          (jj) “Restricted Stock Unit Agreement” means a written agreement
between the Company and the Service Provider evidencing the terms and
restrictions applying to Common Stock which may be acquired through the grant of
Restricted Stock Units. The Restricted Stock Unit Agreement is subject to the
terms and conditions of the Plan and the Notice of Grant.
     3. Stock Subject to the Plan. Subject to the provisions of Section 14 of
the Plan, the maximum aggregate number of Shares which may be optioned and sold
under the Plan is 1,075,008 Shares, plus an annual increase to be added on the
first day of the Company’s fiscal year beginning January 1, 1999, equal to the
lesser of (i) 600,000 Shares, (ii) 4% of the outstanding Shares on such date or
(iii) a lesser amount determined by the Board. The Shares may be authorized, but
unissued, or reacquired Common Stock.
          If an Option or Stock Purchase Right expires or becomes unexercisable
without having been exercised in full, or is surrendered pursuant to an Option
Exchange Program, the unpurchased Shares which were subject thereto shall become
available for future grant or sale under the Plan (unless the Plan has
terminated); provided, however, that Shares that have actually been issued under
the Plan, whether upon exercise of an Option or Right, shall not be returned to
the Plan and shall not become available for future distribution under the Plan,
except that if Shares of Restricted Stock are repurchased by the Company at
their original purchase price, such Shares shall become available for future
grant under the Plan.
     4. Administration of the Plan.
          (a) Procedure.
               (i) Multiple Administrative Bodies. The Plan may be administered
by different Committees with respect to different groups of Service Providers.
               (ii) Section 162(m). To the extent that the Administrator
determines it to be desirable to qualify Options or Restricted Stock Units
granted hereunder as “performance-based compensation” within the meaning of
Section 162(m) of the Code, the Plan shall be administered by a Committee of two
or more “outside directors” within the meaning of Section 162(m) of the Code.
               (iii) Rule 16b-3. To the extent desirable to qualify transactions
hereunder as exempt under Rule 16b-3, the transactions contemplated hereunder
shall be structured to satisfy the requirements for exemption under Rule 16b-3.

- 4 -

--------------------------------------------------------------------------------

 

               (iv) Grants to Outside Directors. Except as otherwise determined
by the Administrator, all grants of Options to Outside Directors shall be made
pursuant to the terms and conditions of Section 12 of the Plan.
               (v) Other Administration. Other than as provided above, the Plan
shall be administered by (A) the Board or (B) a Committee, which committee shall
be constituted to satisfy Applicable Laws.
          (b) Powers of the Administrator. Subject to the provisions of the
Plan, and in the case of a Committee, subject to the specific duties delegated
by the Board to such Committee, the Administrator shall have the authority, in
its discretion:
               (i) to determine the Fair Market Value;
               (ii) to select the Service Providers to whom Options and Stock
Purchase Rights may be granted hereunder;
               (iii) to determine the number of shares of Common Stock to be
covered by each Option and Stock Purchase Right granted hereunder;
               (iv) to approve forms of agreement for use under the Plan;
               (v) to determine the terms and conditions, not inconsistent with
the terms of the Plan, of any Option or Stock Purchase Right granted hereunder.
Such terms and conditions include, but are not limited to, the exercise price,
the time or times when Options or Stock Purchase Rights may be exercised (which
may be based on performance criteria), any vesting acceleration or waiver of
forfeiture restrictions, and any restriction or limitation regarding any Option
or Stock Purchase Right or the shares of Common Stock relating thereto, based in
each case on such factors as the Administrator, in its sole discretion, shall
determine;
               (vi) to reduce the exercise price of any Option or Stock Purchase
Right to the then current Fair Market Value if the Fair Market Value of the
Common Stock covered by such Option or Stock Purchase Right shall have declined
since the date the Option or Stock Purchase Right was granted;
               (vii) to institute an Option Exchange Program;
               (viii) to construe and interpret the terms of the Plan and awards
granted pursuant to the Plan;
               (ix) to prescribe, amend and rescind rules and regulations
relating to the Plan, including rules and regulations relating to sub-plans
established for the purpose of qualifying for preferred tax treatment under
foreign tax laws;
               (x) to modify or amend each Option or Stock Purchase Right
(subject to Section 16(c) of the Plan), including the discretionary authority to
extend the post-termination exercisability period of Options longer than is
otherwise provided for in the Plan;

- 5 -

--------------------------------------------------------------------------------

 

               (xi) to withhold and deduct from future wages of the Service
Provider all legally required amounts necessary to satisfy any and all
withholding and employment-related taxes attributable to the Service Provider’s
exercise of an Option or to the Stock Purchase Right. In the event the Service
Provider is required under the Option Agreement,Restricted Stock Agreement or
Restricted Stock Unit Agreement to pay the Company, or make arrangements
satisfactory to the Company respecting payment of, such withholding and
employment-related taxes, the Administrator may, in its discretion and pursuant
to such rules as it may adopt, permit the Service Provider to satisfy such
obligations, in whole or in part, by electing to have the Company withhold
shares of Common Stock otherwise issuable to the Service Provider, having a Fair
Market Value equal to the minimum required tax withholding based on the minimum
statutory withholding rates for federal and state tax purposes, including
payroll taxes, that are applicable to the supplemental income resulting from the
exercise of the Option or from the Stock Purchase Right. In no event may the
Company withhold shares having a Fair Market Value in excess of such statutory
minimum required tax withholding. The Service Provider’s election to have shares
withheld for this purpose shall be made on or before the date the date that the
amount of tax to be withheld is determined under applicable tax law. Such
election shall be approved by the Administrator and otherwise comply with such
rules as the Administrator may adopt to assure compliance with Rule 16b-3, or
any successor provision, as then in effect, of the General Rules and Regulations
under the Securities Exchange Act of 1934.
               (xii) to authorize any person to execute on behalf of the Company
any instrument required to effect the grant of an Option or Stock Purchase Right
previously granted by the Administrator;
               (xiii) to make all other determinations deemed necessary or
advisable for administering the Plan.
          (c) Effect of Administrator’s Decision. The Administrator’s decisions,
determinations and interpretations shall be final and binding on all Optionees
and any other holders of Options or Stock Purchase Rights.
     5. Eligibility. Nonstatutory Stock Options and Stock Purchase Rights may be
granted to Service Providers. Incentive Stock Options may be granted only to
Employees.
     6. Limitations.
          (a) Each Option shall be designated in the Option Agreement as either
an Incentive Stock Option or a Nonstatutory Stock Option. However,
notwithstanding such designation, to the extent that the aggregate Fair Market
Value of the Shares with respect to which Incentive Stock Options are
exercisable for the first time by the Optionee during any calendar year (under
all plans of the Company and any Parent or Subsidiary) exceeds $100,000, such
Options shall be treated as Nonstatutory Stock Options. For purposes of this
Section 6(a), Incentive Stock Options shall be taken into account in the order
in which they were granted. The Fair Market Value of the Shares shall be
determined as of the time the Option with respect to such Shares is granted.
          (b) Neither the Plan nor any Option or Stock Purchase Right shall
confer upon an Optionee any right with respect to continuing the Optionee’s
relationship as a Service Provider with

- 6 -

--------------------------------------------------------------------------------

 

the Company, nor shall they interfere in any way with the Optionee’s right or
the Company’s right to terminate such relationship at any time, with or without
cause.
          (c) The following limitations shall apply to grants of Options:
               (i) No Service Provider shall be granted, in any fiscal year of
the Company, Options to purchase more than 300,000 Shares.
               (ii) In connection with his or her initial service, a Service
Provider may be granted Options to purchase up to an additional 300,000 Shares
which shall not count against the limit set forth in subsection (i) above.
               (iii) The foregoing limitations shall be adjusted proportionately
in connection with any change in the Company’s capitalization as described in
Section 14.
               (iv) If an Option is cancelled in the same fiscal year of the
Company in which it was granted (other than in connection with a transaction
described in Section 14), the cancelled Option will be counted against the
limits set forth in subsections (i) and (ii) above. For this purpose, if the
exercise price of an Option is reduced, the transaction will be treated as a
cancellation of the Option and the grant of a new Option.
     7. Term of Plan. Subject to Section 20 of the Plan, the Plan shall become
effective upon its adoption by the Board. It shall continue in effect for a term
of ten (10) years unless terminated earlier under Section 16 of the Plan.
     8. Term of Option. The term of each Option shall be stated in the Option
Agreement. In the case of an Incentive Stock Option, the term shall be ten (10)
years from the date of grant or such shorter term as may be provided in the
Option Agreement. Moreover, in the case of an Incentive Stock Option granted to
an Optionee who, at the time the Incentive Stock Option is granted, owns stock
representing more than ten percent (10%) of the total combined voting power of
all classes of stock of the Company or any Parent or Subsidiary, the term of the
Incentive Stock Option shall be five (5) years from the date of grant or such
shorter term as may be provided in the Option Agreement.
     9. Option Exercise Price and Consideration.
          (a) Exercise Price. The per share exercise price for the Shares to be
issued pursuant to exercise of an Option shall be determined by the
Administrator, subject to the following:
               (i) In the case of an Incentive Stock Option
                    (A) granted to an Employee who, at the time the Incentive
Stock Option is granted, owns stock representing more than ten percent (10%) of
the voting power of all classes of stock of the Company or any Parent or
Subsidiary, the per Share exercise price shall be no less than 110% of the Fair
Market Value per Share on the date of grant.

- 7 -

--------------------------------------------------------------------------------

 

                    (B) granted to any Employee other than an Employee described
in paragraph (A) immediately above, the per Share exercise price shall be no
less than 100% of the Fair Market Value per Share on the date of grant.
               (ii) In the case of a Nonstatutory Stock Option, the per Share
exercise price shall be determined by the Administrator. In the case of a
Nonstatutory Stock Option intended to qualify as “performance-based
compensation” within the meaning of Section 162(m) of the Code, the per Share
exercise price shall be no less than 100% of the Fair Market Value per Share on
the date of grant.
               (iii) Notwithstanding the foregoing, Options may be granted with
a per Share exercise price of less than 100% of the Fair Market Value per Share
on the date of grant pursuant to a merger or other corporate transaction.
          (b) Waiting Period and Exercise Dates. At the time an Option is
granted, the Administrator shall fix the period within which the Option may be
exercised and shall determine any conditions which must be satisfied before the
Option may be exercised.
          (c) Form of Consideration. The Administrator shall determine the
acceptable form of consideration for exercising an Option, including the method
of payment. In the case of an Incentive Stock Option, the Administrator shall
determine the acceptable form of consideration at the time of grant. Such
consideration may consist entirely of:
               (i) cash;
               (ii) check;
               (iii) other Shares which (A) in the case of Shares acquired upon
exercise of an option, have been owned by the Optionee for more than six months
on the date of surrender, and (B) have a Fair Market Value on the date of
surrender equal to the aggregate exercise price of the Shares as to which said
Option shall be exercised;
               (iv) consideration received by the Company under a cashless
exercise program implemented by the Company in connection with the Plan;
               (v) a reduction in the amount of any Company liability to the
Optionee, including any liability attributable to the Optionee’s participation
in any Company-sponsored deferred compensation program or arrangement;
               (vi) any combination of the foregoing methods of payment; or
               (vii) such other consideration and method of payment for the
issuance of Shares to the extent permitted by Applicable Laws.
     10. Exercise of Option.

- 8 -

--------------------------------------------------------------------------------

 

          (a) Procedure for Exercise; Rights as a Shareholder. Any Option
granted hereunder shall be exercisable according to the terms of the Plan and at
such times and under such conditions as determined by the Administrator and set
forth in the Option Agreement. Unless the Administrator provides otherwise,
vesting of Options granted hereunder shall be tolled during any unpaid leave of
absence. An Option may not be exercised for a fraction of a Share.
               An Option shall be deemed exercised when the Company receives:
(i) written or electronic notice of exercise (in accordance with the Option
Agreement) from the person entitled to exercise the Option, and (ii) full
payment for the Shares with respect to which the Option is exercised. Full
payment may consist of any consideration and method of payment authorized by the
Administrator and permitted by the Option Agreement and the Plan. Shares issued
upon exercise of an Option shall be issued in the name of the Optionee or, if
requested by the Optionee, in the name of the Optionee and his or her spouse.
Until the Shares are issued (as evidenced by the appropriate entry on the books
of the Company or of a duly authorized transfer agent of the Company), no right
to vote or receive dividends or any other rights as a shareholder shall exist
with respect to the Optioned Stock, notwithstanding the exercise of the Option.
The Company shall issue (or cause to be issued) such Shares promptly after the
Option is exercised. No adjustment will be made for a dividend or other right
for which the record date is prior to the date the Shares are issued, except as
provided in Section 14 of the Plan.
               Exercising an Option in any manner shall decrease the number of
Shares thereafter available, both for purposes of the Plan and for sale under
the Option, by the number of Shares as to which the Option is exercised.
          (b) Termination of Relationship as a Service Provider. If an Optionee
ceases to be a Service Provider, other than upon the Optionee’s death or
Disability, the Optionee may exercise his or her Option within such period of
time as is specified in the Option Agreement to the extent that the Option is
vested on the date of termination (but in no event later than the expiration of
the term of such Option as set forth in the Option Agreement). In the absence of
a specified time in the Option Agreement, the Option shall remain exercisable
for three (3) months following the Optionee’s termination. If, on the date of
termination, the Optionee is not vested as to his or her entire Option, the
Shares covered by the unvested portion of the Option shall revert to the Plan.
If, after termination, the Optionee does not exercise his or her Option within
the time specified by the Administrator, the Option shall terminate, and the
Shares covered by such Option shall revert to the Plan.
          (c) Disability of Optionee. If an Optionee ceases to be a Service
Provider as a result of the Optionee’s Disability, the Optionee may exercise his
or her Option within such period of time as is specified in the Option Agreement
to the extent the Option is vested on the date of termination (but in no event
later than the expiration of the term of such Option as set forth in the Option
Agreement). In the absence of a specified time in the Option Agreement, the
Option shall remain exercisable for twelve (12) months following the Optionee’s
termination. If, on the date of termination, the Optionee is not vested as to
his or her entire Option, the Shares covered by the unvested portion of the
Option shall revert to the Plan. If, after termination, the Optionee does not
exercise his or her Option within the time specified herein, the Option shall
terminate, and the Shares covered by such Option shall revert to the Plan.

- 9 -

--------------------------------------------------------------------------------

 

          (d) Death of Optionee. If an Optionee dies while a Service Provider,
the Option may be exercised within such period of time as is specified in the
Option Agreement (but in no event later than the expiration of the term of such
Option as set forth in the Notice of Grant), by the Optionee’s estate or by a
person who acquires the right to exercise the Option by bequest or inheritance,
but only to the extent that the Option is vested on the date of death. In the
absence of a specified time in the Option Agreement, the Option shall remain
exercisable for twelve (12) months following the Optionee’s termination. If, at
the time of death, the Optionee is not vested as to his or her entire Option,
the Shares covered by the unvested portion of the Option shall immediately
revert to the Plan. The Option may be exercised by the executor or administrator
of the Optionee’s estate or, if none, by the person(s) entitled to exercise the
Option under the Optionee’s will or the laws of descent or distribution. If the
Option is not so exercised within the time specified herein, the Option shall
terminate, and the Shares covered by such Option shall revert to the Plan.
          (e) Buyout Provisions. The Administrator may at any time offer to buy
out for a payment in cash or Shares an Option previously granted based on such
terms and conditions as the Administrator shall establish and communicate to the
Optionee at the time that such offer is made.
     11. Stock Purchase Rights. Stock Purchase Rights may be issued either
alone, in addition to, or in tandem with other awards granted under the Plan
and/or cash awards made outside of the Plan.
          (a) Stock Purchase. After the Administrator determines that it will
offer Stock Purchase Rights under the Plan, it shall advise the offeree in
writing or electronically, by means of a Notice of Grant, of the terms,
conditions and restrictions related to the offer, including the number of Shares
that the offeree shall be entitled to purchase, the price to be paid, and the
time within which the offeree must accept such offer.
               (i) The offer shall be accepted by execution of a Restricted
Stock Agreement in the form determined by the Administrator.
               (ii) Unless the Administrator determines otherwise, the
Restricted Stock Agreement shall grant the Company a repurchase option
exercisable upon the voluntary or involuntary termination of the purchaser’s
services with the Company for any reason (including death or Disability). The
purchase price for Shares repurchased pursuant to the Restricted Stock Agreement
shall be the original purchase price paid by the purchaser and may be paid by
cancellation of any indebtedness of the purchaser to the Company. The repurchase
option shall lapse at a rate determined by the Administrator.
               (iii) Once the Stock Purchase Right is exercised, the purchaser
shall have the rights equivalent to those of a shareholder, and shall be a
shareholder when his or her purchase is entered upon the records of the duly
authorized transfer agent of the Company. No adjustment will be made for a
dividend or other right for which the record date is prior to the date the Stock
Purchase Right is exercised, except as provided in Section 14 of the Plan.

- 10 -

--------------------------------------------------------------------------------

 

          (b) Stock Awards. The Administrator shall determine those Service
Providers who shall be eligible for an award of Restricted Stock. Each award of
Restricted Stock shall be evidenced by a Restricted Stock Agreement, which shall
be in such form as may be approved from time to time by the Administrator and
may vary among Service Providers.
               (i) The Restricted Stock Agreement shall state the total number
of shares of Stock covered by the award of Restricted Stock, shall set forth the
risks of forfeiture, if any, which shall apply to the shares of Restricted Stock
covered by the award, and shall specify the manner in which such risks of
forfeiture shall lapse. The Administrator may, in its sole discretion, modify
the manner in which such risks of forfeiture shall lapse but only with respect
to those shares of Restricted Stock which are restricted as of the effective
date of the modification.
               (ii) The Administrator shall enter the award of Restricted Stock
upon the records of the duly authorized transfer agent of the Company, shall
cause to be issued one or more stock certificates representing such shares of
Restricted Stock in the Service Provider’s name, and shall hold each such
certificate until such time as the risk of forfeiture and other transfer
restrictions set forth in the Service Provider’s Restricted Stock Agreement have
lapsed with respect to the shares represented by the certificate.
               (iii) Until the risks of forfeiture have lapsed or the shares of
Restricted Stock have been forfeited, the Service Provider shall be entitled to
vote the shares of Restricted Stock represented by such stock certificates and
shall receive all dividends attributable to such shares, but the Service
Provider shall not have any other rights as a shareholder with respect to such
shares.
          (c) Other Provisions. The Restricted Stock Agreement authorized under
this Section 11 shall contain such other terms, provisions and conditions not
inconsistent with the Plan as may be determined by the Administrator in its sole
discretion.
          (d) Restricted Stock Units. The Administrator shall determine those
Service Providers who shall be eligible for an award of Restricted Stock Units.
Each award of Restricted Stock Units shall be evidenced by a Restricted Stock
Unit Agreement, which shall be in such form as may be approved from time to time
by the Administrator and may vary among Service Providers.
               (i) The Restricted Stock Unit Agreement shall state the total
number of Restricted Stock Units, shall set forth the risks of forfeiture, if
any, which shall apply to the Restricted Stock Units covered by the award, and
shall specify the manner in which such risks of forfeiture shall lapse. Either
the award of the Restricted Stock Units or the manner in which the risks of
forfeiture lapse may be based on the achievement of performance targets
established in writing by the Administrator. Such performance targets shall
consist of one or any combination of two or more of the following corporate
performance criteria: operating profit, pre-tax profit, net income, earnings per
share, return on invested capital and return on working capital. The
Administrator may, in its sole discretion, modify the manner in which such risks
of forfeiture shall lapse but only with respect to those Restricted Stock Units
which are restricted as of the effective date of the modification. No Service
Provider shall be granted Restricted Stock Units for more than 300,000 Shares in
any fiscal year of the Company.

- 11 -

--------------------------------------------------------------------------------

 

               (ii) As the risks of forfeiture on Restricted Stock Units lapse,
the Administrator shall cause to be issued one or more stock certificates in the
Service Provider’s name and shall deliver such certificates to the Service
Provider in satisfaction of such Restricted Stock Units.
               (iii) Until the risks of forfeiture on the Restricted Stock Units
have lapsed, the Service Provider shall not be entitled to vote any shares of
stock which may be acquired through the Restricted Stock Units, shall not
receive any dividends attributable to such shares, and shall not have any other
rights as a shareholder with respect to such shares.
               (iv) Other Provisions. The Restricted Stock Unit Agreement
authorized under this Section 11(d) shall contain such other terms, provisions
and conditions not inconsistent with the Plan as may be determined by the
Administrator in its sole discretion.
     12. Automatic Option Grants to Outside Directors. All grants of Options to
Outside Directors pursuant to this Section shall be automatic and
nondiscretionary and shall be made strictly in accordance with the following
provisions:
          (a) All Options granted pursuant to this Section shall be Nonstatutory
Stock Options and, except as otherwise provided herein, shall be subject to the
other terms and conditions of the Plan.
          (b) No person shall have any discretion to select which Outside
Directors shall be granted Options under this Section or to determine the number
of Shares to be covered by such Options.
          (c) Each person who first becomes an Outside Director following the
effective date of this Plan, as determined in accordance with Section 7 hereof,
shall be automatically granted an Option to purchase 22,500 Shares (the “First
Option”) on the date on which such person first becomes an Outside Director,
whether through election by the shareholders of the Company or appointment by
the Board to fill a vacancy; provided, however, that an Inside Director who
ceases to be an Inside Director but who remains a Director shall not receive a
First Option.
          (d) Each Outside Director shall be automatically granted, subject to
such Outside Director’s right to decline such grant in his/her discretion, an
Option to purchase 10,000 Shares (a “Subsequent Option”) on the date of the
Company’s annual meeting of the shareholders each year; provided, such Outside
Director continues to serve as a Director on such dates and, if as of such date,
he or she shall have served on the Board for at least the preceding six
(6) months.
          (e) Notwithstanding the provisions of subsections (c) and (d) hereof,
any exercise of an Option granted before the Company has obtained shareholder
approval of the Plan in accordance with Section 20 hereof shall be conditioned
upon obtaining such shareholder approval of the Plan in accordance with
Section 20 hereof.

- 12 -

--------------------------------------------------------------------------------

 

          (f) The terms of each Option granted pursuant to this Section shall be
as follows:
               (i) the term of the Option shall be ten (10) years; provided,
however, that prior to the grant date of the automatic option the Administrator,
at its discretion, can change the term to a term that is less than ten years.
               (ii) the Option shall be exercisable only while the Outside
Director remains a Director of the Company, except as set forth in Section 10
hereof.
               (iii) the exercise price per Share shall be 100% of the Fair
Market Value per Share on the date of grant of the Option.
               (iv) effective August 5, 1999, the First Option shall be
exercisable as to 100% of the Shares subject to the First Option on the date of
grant.
               (v) effective August 5, 1999, each Subsequent Option shall be
exercisable as to 100% of the Shares subject to the Subsequent Option on the
date of grant.
     13. Non-Transferability of Options and Stock Purchase Rights. Unless
determined otherwise by the Administrator, an Option or Stock Purchase Right may
not be sold, pledged, assigned, hypothecated, transferred, or disposed of in any
manner other than by will or by the laws of descent or distribution and may be
exercised, during the lifetime of the Optionee, only by the Optionee. If the
Administrator makes an Option or Stock Purchase Right transferable, such Option
or Stock Purchase Right shall contain such additional terms and conditions as
the Administrator deems appropriate.
     14. Adjustments Upon Changes in Capitalization, Dissolution, Merger or
Asset Sale.
          (a) Changes in Capitalization. Subject to any required action by the
shareholders of the Company, the number of shares of Common Stock covered by
each outstanding Option and Stock Purchase Right, and the number of shares of
Common Stock which have been authorized for issuance under the Plan but as to
which no Options or Stock Purchase Rights have yet been granted or which have
been returned to the Plan upon cancellation or expiration of an Option or Stock
Purchase Right, as well as the price per share of Common Stock covered by each
such outstanding Option or Stock Purchase Right, shall be proportionately
adjusted for any increase or decrease in the number of issued shares of Common
Stock resulting from a stock split, reverse stock split, stock dividend,
combination or reclassification of the Common Stock, or any other increase or
decrease in the number of issued shares of Common Stock effected without receipt
of consideration by the Company; provided, however, that conversion of any
convertible securities of the Company shall not be deemed to have been “effected
without receipt of consideration.” Such adjustment shall be made by the Board,
whose determination in that respect shall be final, binding and conclusive.
Except as expressly provided herein, no issuance by the Company of shares of
stock of any class, or securities convertible into shares of stock of any class,
shall affect, and no adjustment by reason thereof shall be made with respect to,
the number or price of shares of Common Stock subject to an Option or Stock
Purchase Right.

- 13 -

--------------------------------------------------------------------------------

 

          (b) Dissolution or Liquidation. In the event of the proposed
dissolution or liquidation of the Company, the Administrator shall notify each
Optionee as soon as practicable prior to the effective date of such proposed
transaction. The Administrator in its discretion may provide for an Optionee to
have the right to exercise his or her Option until ten (10) days prior to such
transaction as to all of the Optioned Stock covered thereby, including Shares as
to which the Option would not otherwise be exercisable. In addition, the
Administrator may provide that any Company repurchase option applicable to any
Shares purchased upon exercise of an Option or Stock Purchase Right or any risks
of forfeiture on an award of Restricted Stock granted pursuant to Section 11(b)
or an award of Restricted Stock Units granted pursuant to Section 11(d) shall
lapse as to all such Shares, provided the proposed dissolution or liquidation
takes place at the time and in the manner contemplated. To the extent it has not
been previously exercised, an Option or Stock Purchase Right will terminate
immediately prior to the consummation of such proposed action.
          (c) Merger or Asset Sale. In the event of a merger of the Company with
or into another corporation, or the sale of substantially all of the assets of
the Company, each outstanding Option and Stock Purchase Right shall be assumed
or an equivalent option or right substituted by the successor corporation or a
Parent or Subsidiary of the successor corporation. In the event that the
successor corporation refuses to assume or substitute for the Option or Stock
Purchase Right, the Optionee shall fully vest in and have the right to exercise
the Option or Stock Purchase Right as to all of the Optioned Stock, including
Shares as to which it would not otherwise be vested or exercisable, and all
risks of forfeiture on awards of Restricted Stock granted pursuant to Section
11(b) and Restricted Stock Units granted pursuant to Section 11(d) shall lapse.
If an Option or Stock Purchase Right becomes fully vested and exercisable in
lieu of assumption or substitution in the event of a merger or sale of assets,
the Administrator shall notify the Optionee in writing or electronically that
the Option or Stock Purchase Right shall be fully vested. Except with respect to
awards of Restricted Stock granted pursuant to Section 11(b) and Restricted
Stock Units granted pursuant to Section 11(d), such Option or Stock Purchase
Right shall remain exercisable for a period of fifteen (15) days from the date
of such notice but shall terminate upon the expiration of such period. For the
purposes of this paragraph, the Option or Stock Purchase Right shall be
considered assumed if, following the merger or sale of assets, the option or
right confers the right to purchase or receive, for each Share of Optioned Stock
subject to the Option or Stock Purchase Right immediately prior to the merger or
sale of assets, the consideration (whether stock, cash, or other securities or
property) received in the merger or sale of assets by holders of Common Stock
for each Share held on the effective date of the transaction (and if holders
were offered a choice of consideration, the type of consideration chosen by the
holders of a majority of the outstanding Shares); provided, however, that if
such consideration received in the merger or sale of assets is not solely common
stock of the successor corporation or its Parent, the Administrator may, with
the consent of the successor corporation, provide for the consideration to be
received upon the exercise of the Option or Stock Purchase Right, for each Share
of Optioned Stock subject to the Option or Stock Purchase Right, to be solely
common stock of the successor corporation or its Parent equal in fair market
value to the per share consideration received by holders of Common Stock in the
merger or sale of assets.
     15. Date of Grant. The date of grant of an Option or Stock Purchase Right
shall be, for all purposes, the date on which the Administrator makes the
determination granting such Option or Stock Purchase Right, or such other later
date as is determined by the Administrator. Notice of the determination shall be
provided to each Optionee within a reasonable time after the date of such grant.

- 14 -

--------------------------------------------------------------------------------

 

     16. Amendment and Termination of the Plan.
          (a) Amendment and Termination. The Board may at any time amend, alter,
suspend or terminate the Plan.
          (b) Shareholder Approval. The Company shall obtain shareholder
approval of any Plan amendment to the extent necessary and desirable to comply
with Applicable Laws.
          (c) Effect of Amendment or Termination. No amendment, alteration,
suspension or termination of the Plan shall impair the rights of any Optionee,
unless mutually agreed otherwise between the Optionee and the Administrator,
which agreement must be in writing and signed by the Optionee and the Company.
Termination of the Plan shall not affect the Administrator’s ability to exercise
the powers granted to it hereunder with respect to Options granted under the
Plan prior to the date of such termination.
     17. Conditions Upon Issuance of Shares.
          (a) Legal Compliance. Shares shall not be issued pursuant to the
exercise of an Option or Stock Purchase Right unless the exercise of such Option
or Stock Purchase Right and the issuance and delivery of such Shares shall
comply with Applicable Laws and shall be further subject to the approval of
counsel for the Company with respect to such compliance.
          (b) Investment Representations. As a condition to the exercise of an
Option or Stock Purchase Right, the Company may require the person exercising
such Option or Stock Purchase Right to represent and warrant at the time of any
such exercise that the Shares are being purchased only for investment and
without any present intention to sell or distribute such Shares if, in the
opinion of counsel for the Company, such a representation is required.
     18. Inability to Obtain Authority. The inability of the Company to obtain
authority from any regulatory body having jurisdiction, which authority is
deemed by the Company’s counsel to be necessary to the lawful issuance and sale
of any Shares hereunder, shall relieve the Company of any liability in respect
of the failure to issue or sell such Shares as to which such requisite authority
shall not have been obtained.
     19. Reservation of Shares. The Company, during the term of this Plan, will
at all times reserve and keep available such number of Shares as shall be
sufficient to satisfy the requirements of the Plan.
     20. Shareholder Approval. The Plan shall be subject to approval by the
shareholders of the Company within twelve (12) months after the date the Plan is
adopted. Such shareholder approval shall be obtained in the manner and to the
degree required under Applicable Laws.

- 15 -

--------------------------------------------------------------------------------

 

BELL MICROPRODUCTS INC.
1998 STOCK PLAN
STOCK OPTION AGREEMENT
     Unless otherwise defined herein, the terms defined in the Plan shall have
the same defined meanings in this Option Agreement.
I. NOTICE OF STOCK OPTION GRANT
Name
     You have been granted an option to purchase Common Stock of the Company,
subject to the terms and conditions of the Plan and this Option Agreement, as
follows:

         
 
  Grant Number                                                               
 
       
 
  Date of Grant                                                               
 
       
 
  Vesting Commencement Date  
                                                            
 
       
 
  Exercise Price per Share  
$                                                            
 
       
 
  Total Number of Shares Granted  
                                                            
 
       
 
  Total Exercise Price  
$                                                            
 
       
 
  Type of Option:   ___     Incentive Stock Option
 
       
 
      ___     Nonstatutory Stock Option
 
       
 
  Term/Expiration Date:  
                                                            

   Vesting Schedule:
     This Option may be exercised, in whole or in part, in accordance with the
following schedule:
     [25% of the Shares subject to the Option shall vest on the first four
annual anniversaries of the Date of Grant, subject to the Optionee continuing to
be a Service Provider on such dates].

- 1 -

--------------------------------------------------------------------------------

 

     Termination Period:
     This Option may be exercised for thirty (30) days after Optionee ceases to
be a Service Provider. Upon the death or Disability of the Optionee, this Option
may be exercised for one year after Optionee ceases to be a Service Provider. In
no event shall this Option be exercised later than the Term/Expiration Date as
provided above.
II. AGREEMENT
     1 Grant of Option. The Plan Administrator of the Company hereby grants to
the Optionee named in the Notice of Grant attached as Part I of this Agreement
(the “Optionee”) an option (the “Option”) to purchase the number of Shares, as
set forth in the Notice of Grant, at the exercise price per share set forth in
the Notice of Grant (the “Exercise Price”), subject to the terms and conditions
of the Plan, which is incorporated herein by reference. Subject to Section 16(c)
of the Plan, in the event of a conflict between the terms and conditions of the
Plan and the terms and conditions of this Option Agreement, the terms and
conditions of the Plan shall prevail.
          If designated in the Notice of Grant as an Incentive Stock Option
(“ISO”), this Option is intended to qualify as an Incentive Stock Option under
Section 422 of the Code. However, if this Option is intended to be an Incentive
Stock Option, to the extent that it exceeds the $100,000 rule of Code Section
422(d) it shall be treated as a Nonstatutory Stock Option (“NSO”).
     2 Exercise of Option.
          (a) Right to Exercise. This Option is exercisable during its term in
accordance with the Vesting Schedule set out in the Notice of Grant and the
applicable provisions of the Plan and this Option Agreement.
          (b) Method of Exercise. This Option is exercisable by delivery of an
exercise notice, in the form attached as Exhibit A (the “Exercise Notice”),
which shall state the election to exercise the Option, the number of Shares in
respect of which the Option is being exercised (the “Exercised Shares”), and
such other representations and agreements as may be required by the Company
pursuant to the provisions of the Plan. The Exercise Notice shall be completed
by the Optionee and delivered to the Secretary of the Company. The Exercise
Notice shall be accompanied by payment of the aggregate Exercise Price as to all
Exercised Shares. This Option shall be deemed to be exercised upon receipt by
the Company of such fully executed Exercise Notice accompanied by such aggregate
Exercise Price.
          No Shares shall be issued pursuant to the exercise of this Option
unless such issuance and exercise complies with Applicable Laws. Assuming such
compliance, for income tax purposes the Exercised Shares shall be considered
transferred to the Optionee on the date the Option is exercised with respect to
such Exercised Shares.

- 2 -

--------------------------------------------------------------------------------

 

     3 Method of Payment. Payment of the aggregate Exercise Price shall be by
any of the following, or a combination thereof, at the election of the Optionee:
          (a) cash; or
          (b) check; or
          (c) consideration received by the Company under a cashless exercise
program implemented by the Company in connection with the Plan; or
          (d) surrender of other Shares which (i) in the case of Shares acquired
upon exercise of an option, have been owned by the Optionee for more than six
(6) months on the date of surrender, and (ii) have a Fair Market Value on the
date of surrender equal to the aggregate Exercise Price of the Exercised Shares
     4 Non-Transferability of Option. This Option may not be transferred in any
manner otherwise than by will or by the laws of descent or distribution and may
be exercised during the lifetime of Optionee only by the Optionee. The terms of
the Plan and this Option Agreement shall be binding upon the executors,
administrators, heirs, successors and assigns of the Optionee.
     5 Term of Option. This Option may be exercised only within the term set out
in the Notice of Grant, and may be exercised during such term only in accordance
with the Plan and the terms of this Option Agreement.
     6 Tax Consequences. Some of the federal tax consequences relating to this
Option, as of the date of this Option, are set forth below. THIS SUMMARY IS
NECESSARILY INCOMPLETE, AND THE TAX LAWS AND REGULATIONS ARE SUBJECT TO CHANGE.
THE OPTIONEE SHOULD CONSULT A TAX ADVISER BEFORE EXERCISING THIS OPTION OR
DISPOSING OF THE SHARES.
          (a) Exercising the Option.
               (i) Nonstatutory Stock Option. The Optionee may incur regular
federal income tax liability upon exercise of a NSO. The Optionee will be
treated as having received compensation income (taxable at ordinary income tax
rates) equal to the excess, if any, of the Fair Market Value of the Exercised
Shares on the date of exercise over their aggregate Exercise Price. If the
Optionee is an Employee or a former Employee, the Company will be required to
withhold from his or her compensation or collect from Optionee and pay to the
applicable taxing authorities an amount in cash equal to a percentage of this
compensation income at the time of exercise, and may refuse to honor the
exercise and refuse to deliver Shares if such withholding amounts are not
delivered at the time of exercise.
               (ii) Incentive Stock Option. If this Option qualifies as an ISO,
the Optionee will have no regular federal income tax liability upon its
exercise, although the excess, if any, of the Fair Market Value of the Exercised
Shares on the date of exercise over their aggregate Exercise Price will be
treated as an adjustment to alternative minimum taxable income for federal tax
purposes and may subject the Optionee to alternative minimum tax in the year of
exercise. In the

- 3 -

--------------------------------------------------------------------------------

 

event that the Optionee ceases to be an Employee but remains a Service Provider,
any Incentive Stock Option of the Optionee that remains unexercised shall cease
to qualify as an Incentive Stock Option and will be treated for tax purposes as
a Nonstatutory Stock Option on the date three (3) months and one (1) day
following such change of status.
          (b) Disposition of Shares.
               (i) NSO. If the Optionee holds NSO Shares for at least one year,
any gain realized on disposition of the Shares will be treated as long-term
capital gain for federal income tax purposes.
               (ii) ISO. If the Optionee holds ISO Shares for at least one year
after exercise and two years after the grant date, any gain realized on
disposition of the Shares will be treated as long-term capital gain for federal
income tax purposes. If the Optionee disposes of ISO Shares within one year
after exercise or two years after the grant date, any gain realized on such
disposition will be treated as compensation income (taxable at ordinary income
rates) to the extent of the excess, if any, of the lesser of (A) the difference
between the Fair Market Value of the Shares acquired on the date of exercise and
the aggregate Exercise Price, or (B) the difference between the sale price of
such Shares and the aggregate Exercise Price. Any additional gain will be taxed
as capital gain, short-term or long-term depending on the period that the ISO
Shares were held.
          (c) Notice of Disqualifying Disposition of ISO Shares. If the Optionee
sells or otherwise disposes of any of the Shares acquired pursuant to an ISO on
or before the later of (i) two years after the grant date, or (ii) one year
after the exercise date, the Optionee shall immediately notify the Company in
writing of such disposition. The Optionee agrees that he or she may be subject
to income tax withholding by the Company on the compensation income recognized
from such early disposition of ISO Shares by payment in cash or out of the
current earnings paid to the Optionee.
     7 Entire Agreement; Governing Law. The Plan is incorporated herein by
reference. The Plan and this Option Agreement constitute the entire agreement of
the parties with respect to the subject matter hereof and supersede in their
entirety all prior undertakings and agreements of the Company and Optionee with
respect to the subject matter hereof, and may not be modified adversely to the
Optionee’s interest except by means of a writing signed by the Company and
Optionee. This agreement is governed by the internal substantive laws, but not
the choice of law rules, of California.
     8 NO GUARANTEE OF CONTINUED SERVICE. OPTIONEE ACKNOWLEDGES AND AGREES THAT
THE VESTING OF SHARES PURSUANT TO THE VESTING SCHEDULE HEREOF IS EARNED ONLY BY
CONTINUING AS A SERVICE PROVIDER AT THE WILL OF THE COMPANY (AND NOT THROUGH THE
ACT OF BEING HIRED, BEING GRANTED AN OPTION OR PURCHASING SHARES HEREUNDER).
OPTIONEE FURTHER ACKNOWLEDGES AND AGREES THAT THIS AGREEMENT, THE TRANSACTIONS
CONTEMPLATED HEREUNDER AND THE VESTING SCHEDULE SET FORTH HEREIN DO NOT
CONSTITUTE AN EXPRESS OR IMPLIED PROMISE OF CONTINUED ENGAGEMENT AS A SERVICE
PROVIDER FOR THE VESTING PERIOD, FOR ANY PERIOD, OR AT ALL,

- 4 -

--------------------------------------------------------------------------------

 

AND SHALL NOT INTERFERE WITH OPTIONEE’S RIGHT OR THE COMPANY’S RIGHT TO
TERMINATE OPTIONEE’S RELATIONSHIP AS A SERVICE PROVIDER AT ANY TIME, WITH OR
WITHOUT CAUSE.
     By your signature and the signature of the Company’s representative below,
you and the Company agree that this Option is granted under and governed by the
terms and conditions of the Plan and this Option Agreement. Optionee has
reviewed the Plan and this Option Agreement in their entirety, has had an
opportunity to obtain the advice of counsel prior to executing this Option
Agreement and fully understands all provisions of the Plan and Option Agreement.
Optionee hereby agrees to accept as binding, conclusive and final all decisions
or interpretations of the Administrator upon any questions relating to the Plan
and Option Agreement. Optionee further agrees to notify the Company upon any
change in the residence address indicated below.

             
OPTIONEE:
      BELL MICROPRODUCTS INC.    
 
           
 
Signature
     
 
     By    
 
           
 
Print Name
     
 
     Title    
 
           
 
Residence Address
           
 
           
 
 
           

- 5 -

--------------------------------------------------------------------------------

 

EXHIBIT A
1998 STOCK PLAN
EXERCISE NOTICE
Bell Microproducts Inc.
1941 Ringwood Avenue
San Jose, CA 95131
Attention: Secretary
     1 Exercise of Option. Effective as of today,                     , ___, the
undersigned (“Purchaser”) hereby elects to purchase                      shares
(the “Shares”) of the Common Stock of Bell Microproducts Inc. (the “Company”)
under and pursuant to the 1998 Stock Plan (the “Plan”) and the Stock Option
Agreement dated                     , ___ (the “Option Agreement”). The purchase
price for the Shares shall be $                    , as required by the Option
Agreement.
     2 Delivery of Payment. Purchaser herewith delivers to the Company the full
purchase price for the Shares.
     3 Representations of Purchaser. Purchaser acknowledges that Purchaser has
received, read and understood the Plan and the Option Agreement and agrees to
abide by and be bound by their terms and conditions.
     4 Rights as Shareholder. Until the issuance (as evidenced by the
appropriate entry on the books of the Company or of a duly authorized transfer
agent of the Company) of the Shares, no right to vote or receive dividends or
any other rights as a shareholder shall exist with respect to the Optioned
Stock, notwithstanding the exercise of the Option. The Shares so acquired shall
be issued to the Optionee as soon as practicable after exercise of the Option.
No adjustment will be made for a dividend or other right for which the record
date is prior to the date of issuance, except as provided in Section 14 of the
Plan.
     5 Tax Consultation. Purchaser understands that Purchaser may suffer adverse
tax consequences as a result of Purchaser’s purchase or disposition of the
Shares. Purchaser represents that Purchaser has consulted with any tax
consultants Purchaser deems advisable in connection with the purchase or
disposition of the Shares and that Purchaser is not relying on the Company for
any tax advice.

 

--------------------------------------------------------------------------------

 

     6 Entire Agreement; Governing Law. The Plan and Option Agreement are
incorporated herein by reference. This Agreement, the Plan and the Option
Agreement constitute the entire agreement of the parties with respect to the
subject matter hereof and supersede in their entirety all prior undertakings and
agreements of the Company and Purchaser with respect to the subject matter
hereof, and may not be modified adversely to the Purchaser’s interest except by
means of a writing signed by the Company and Purchaser. This agreement is
governed by the internal substantive laws, but not the choice of law rules, of
California.

             
Submitted by:
      Accepted by:    
 
           
PURCHASER:
      BELL MICROPRODUCTS INC.    
 
           
 
Signature
     
 
     By    
 
           
 
Print Name
     
 
     Its    
 
           
Address:
                  Address:    
 
           
 
      1941 Ringwood Avenue    
 
      San Jose, CA 95131    
 
           
 
           
 
     
 
Date Received