Exhibit 10.1

SCIENCE APPLICATIONS INTERNATIONAL CORPORATION

STOCK COMPENSATION PLAN

Amended and Restated Effective as of January 1, 2005

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TABLE OF CONTENTS

 

          Page

ARTICLE I DEFINITIONS

   1

1.1

   Account    1

1.2

   Award    1

1.3

   Awarding Authority    1

1.4

   Beneficiary    1

1.5

   Board    1

1.6

   Capital Restructuring Dividend    1

1.7

   Code    1

1.8

   Committee    1

1.9

   Company    1

1.10

   Company Stock    2

1.11

   Dividend Equivalent    2

1.12

   Employee    2

1.13

   Fair Market Value    2

1.14

   Ordinary Dividend    2

1.15

   Participant    2

1.16

   Plan    2

1.17

   Separation From Service    2

1.18

   Share Unit    2

1.19

   Termination of Affiliation    3

1.20

   Trust    3

1.21

   Trustee    3

ARTICLE II PARTICIPATION AND AWARDS

   3

2.1

   Designation by Awarding Authority    3

2.2

   Awarding Authority to Make Awards    3

2.3

   Awards May be Held in Trust    3

2.4

   Vesting and Forfeiture    4

ARTICLE III TRUST FUND

   4

3.1

   Trust Fund Established    4

 

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TABLE OF CONTENTS

(continued)

 

          Page

3.2

   Company, Committee, Board, Award Authority and Trustee Not Responsible for
Adequacy of Trust Fund    4

3.3

   Invasion of Trust by Creditors    4

3.4

   Trust Expenses    4

ARTICLE IV ACCOUNTS

   5

4.1

   Committee to Maintain Accounts    5

4.2

   Accounting Procedures    5

ARTICLE V RIGHTS IN ACQUIRED STOCK

   5

5.1

   Power to Vote Stock Rests With Trustee    5

5.2

   Tender Offers    5

5.3

   Dividends    5

ARTICLE VI DISTRIBUTION OF ACCOUNTS

   5

6.1

   Time of Distribution    5

6.2

   Form of Distribution    6

6.3

   Beneficiary Designation    7

6.4

   Distribution to Guardian    7

6.5

   Withholding of Taxes    7

6.6

   Distribution of Dividend Equivalents    7

ARTICLE VII ACCELERATION OF DISTRIBUTION AND/OR VESTING

   8

7.1

   Change in Control    8

7.2

   Hardship    8

ARTICLE VIII PLAN TERMINATION AND AMENDMENT

   9

8.1

   Termination and Amendments    9

ARTICLE IX PLAN ADMINISTRATION

   9

9.1

   Committee    9

9.2

   Committee Powers    9

9.3

   Plan Expenses    11

9.4

   Reliance Upon Documents and Opinions    11

9.5

   Requirement of Proof    11

9.6

   Limitation on Liability    11

 

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TABLE OF CONTENTS

(continued)

 

          Page

9.7

   Indemnification    11

ARTICLE X MISCELLANEOUS PROVISIONS

   12

10.1

   Restrictions on Plan Interest    12

10.2

   No Enlargement of Employee Rights    13

10.3

   Rights of Repurchase and First Refusal for the Company    13

10.4

   Mailing of Payments    13

10.5

   Inability to Locate Participant or Beneficiary    13

10.6

   Governing Law    13

10.7

   Illegality of Particular Provision    14

10.8

   Interpretation    14

10.9

   Tax Effects    14

10.10

   Receipt or Release    14

10.11

   Records    14

10.12

   Arbitration    14

 

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SCIENCE APPLICATIONS INTERNATIONAL CORPORATION

STOCK COMPENSATION PLAN

PURPOSE

This Plan is an unfunded compensation arrangement established effective as of
April 3, 1996 by Science Applications International Corporation to make deferred
awards of company stock to selected employees. This Plan is amended and restated
effective January 1, 2005 to comply with Code Section 409A.

ARTICLE I

DEFINITIONS

Whenever the following terms are used in the Plan they shall have the meaning
specified below, unless the context indicates clearly to the contrary.

1.1 Account. The bookkeeping account established for an Employee pursuant to
Article IV to record the number of Share Units awarded to the Employee and the
vesting thereof.

1.2 Award. The award of Share Units to an Employee pursuant to the Plan.

1.3 Awarding Authority. The individual or group of individuals appointed by the
Board to make Awards pursuant to the Plan.

1.4 Beneficiary. The person or persons properly designated by the Participant,
in accordance with Section 6.3, to receive the benefits provided herein upon
death of the Participant.

1.5 Board. The Board of Directors of Science Applications International
Corporation or its ultimate parent corporation, if any.

1.6 Capital Restructuring Dividend. The non-recurring cash dividend paid by the
Company in 2006 or 2007 on shares of Company Stock in connection with the
Company’s capital restructuring and the initial public offering of Company
Stock.

1.7 Code. The Internal Revenue Code of 1986, as amended.

1.8 Committee. The committee appointed by the Board to administer the Plan.
Members of the Committee shall be eligible to receive Awards under the Plan at
the discretion of the Awarding Authority.

1.9 Company. Science Applications International Corporation (or its ultimate
parent corporation, if any). In addition, unless the context indicates
otherwise, as used in this Plan, the term Company shall also mean and include
any direct or indirect subsidiary of the Company which has been approved by the
Awarding Authority for participation in this Plan by its Employees.

 

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1.10 Company Stock. The Class A Common Stock of Science Applications
International Corporation, or any other security (including preferred stock) of
the Company or the Company’s ultimate parent corporation, if any, designated as
Company Stock by the Committee.

1.11 Dividend Equivalent. The amount of the Capital Restructuring Dividend paid
by the Company on that number of shares of Company Stock which is equal to the
number of Share Units then credited to a Participant’s Account.

1.12 Employee. A salaried employee of the Company.

1.13 Fair Market Value.

(1) If the Company Stock is being valued in connection with a transaction (such
as the crediting of Share Units to an Account or a distribution) for which the
Committee determines there is a corresponding transaction by the Trust, the net
price per share of Company Stock purchased or the net proceeds per share of
Company Stock sold in the transaction by the Trust, in each case including all
expenses of such transaction by the Trust.

(2) If paragraph (1) does not apply, (a) the closing price of the Company Stock
on the New York Stock Exchange on the date for which the fair market value is
determined, or, if there is no trading of the Company Stock on such date, then
the closing price of the Company Stock on the New York Stock Exchange on the
next preceding date on which there was trading in such shares; or (b) if the
Company Stock is not listed, admitted or quoted, the Committee may designate
such other source of data as it deems appropriate for determining such value for
purposes of this Plan.

1.14 Ordinary Dividend. All cash dividends or other cash distributions, other
than the Capital Restructuring Dividend, paid by the Company on shares of
Company Stock.

1.15 Participant. An Employee designated by the Awarding Authority to receive an
Award under the Plan.

1.16 Plan. The Science Applications International Corporation Stock Compensation
Plan as set forth herein and as amended from time to time.

1.17 Separation From Service. The death, retirement or termination of the
Employee’s employment with the Company. This definition of Separation From
Service shall be interpreted and construed in a manner intended to comply with
Code Section 409A and the published authorities thereunder.

1.18 Share Unit. The interest of a Participant in a share of Company Stock held
in the Participant’s Account. A full Share Unit shall be equivalent to a full
share of Company Stock, and a partial Share Unit shall be equivalent to the
corresponding fraction of a share of Company Stock.

 

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1.19 Termination of Affiliation. Any termination of employment with the Company
by an Employee, as determined by the Committee, whether by reason of death,
disability, voluntary resignation, layoff, discharge, or otherwise. Furthermore,
if an Employee is employed by a direct or indirect subsidiary of the Company,
such an Employee will have a Termination of Affiliation upon the divestiture of
such subsidiary. The Committee shall have the discretion to establish rules and
make determinations as to what constitutes a Termination of Affiliation
including, without limitation, change of status (e.g., part-time, consulting
Employee, etc.) or leave of absence. A Termination of Affiliation may occur
regardless of whether an Employee has had a Separation From Service.

1.20 Trust. The Science Applications International Corporation Stock
Compensation Plan Trust established by the Company to hold assets awarded to
Participants under the Plan.

1.21 Trustee. Wachovia Bank or such successor trustee as shall be appointed
pursuant to the Trust.

ARTICLE II

PARTICIPATION AND AWARDS

2.1 Designation by Awarding Authority. The Awarding Authority in its sole
discretion shall designate those Employees who are to receive Awards under the
Plan. The Awarding Authority’s designation of an Employee for a particular Award
shall not require the Awarding Authority to make any further Awards to such
Employee.

2.2 Awarding Authority to Make Awards. The Awarding Authority shall make Awards
under the Plan by determining a number of Share Units to be credited to those
Employees whom the Awarding Authority has selected for participation in the Plan
and by establishing an Account in favor of such Employees in accordance with
Article IV to hold such Share Units. A separate Account shall be established for
each Award. Each Account shall be subject to a vesting schedule specified by the
Awarding Authority. The amount, timing and vesting of each Award shall be
decided in the Awarding Authority’s sole discretion, and the Awarding Authority
may apply different terms to Awards made to different Employees as well as to
different Awards made to the same Employee.

2.3 Awards May be Held in Trust.

(a) With respect to Awards granted before January 1, 2005, within a reasonable
period of time following the date of the Award, the Company shall contribute to
the Trust Company Stock or an amount of money sufficient to purchase shares of
Company Stock corresponding to the number of Share Units made in such Award. The
Trustee shall apply such contribution toward the purchase of Company Stock in
accordance with the directions of the Committee and the terms of the Trust. To
the extent any such Award is made to an Employee of an affiliate of the Company,
the Company may charge the cost of the corresponding Trust contribution to such
affiliate as agreed between the Company and the affiliate.

 

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(b) Effective January 1, 2005, contributions to the Trust with respect to Awards
shall be made only if the Company, in its sole discretion, determines to make
such contributions. Regardless of whether the Company makes contributions to the
Trust with respect to Awards, the Participant shall be credited with a number of
Share Units subject to the Award.

2.4 Vesting and Forfeiture. Each Account shall be subject to a vesting schedule,
not to exceed seven (7) years, established by the Awarding Authority. Vesting
shall cease upon the Participant’s Termination of Affiliation for any reason
other than the death of the Participant. In the event of death of a Participant,
all of the Participant’s Account(s) shall become immediately vested. The
unvested portion of a Participant’s Accounts upon a Termination of Affiliation
shall be immediately forfeited by the Participant, and any shares of Company
Stock represented by such unvested portion shall be returned to the Company or
reallocated in accordance with the Committee’s directions and the terms of the
Trust. Notwithstanding anything to the contrary in the provisions of this Plan
regarding distribution of Accounts, the provisions of this Section 2.4 shall
govern vesting and forfeitures of Accounts. Accordingly, a Participant may have
a Termination of Affiliation under this Section 2.4 (resulting in a forfeiture
of the unvested portion of the Participant’s Accounts) prior to the
Participant’s Separation From Service.

ARTICLE III

TRUST FUND

3.1 Trust Fund Established. The Company has established the Trust pursuant to a
trust agreement under which the Trustee will hold and administer in trust all
assets deposited with the Trustee in accordance with the terms of this Plan. The
Board shall have the authority to select and remove the Trustee to act under the
Trust agreement, and to enter into new or amended trust agreements as it deems
advisable.

3.2 Company, Committee, Board, Award Authority and Trustee Not Responsible for
Adequacy of Trust Fund. Neither the Company, Board, Award Authority, Committee
nor Trustee shall be liable or responsible for the adequacy of funds held in the
Trust to meet and discharge any or all payments and liabilities hereunder. All
Plan benefits will be paid from the Trust assets or by the Company to the extent
not paid from Trust assets, and neither the Board, Award Authority, Committee
nor the Trustee shall have any duty or liability to pay such benefits or furnish
the Trust with any funds, securities or other assets.

3.3 Invasion of Trust by Creditors. If assets of the Trust should be reduced due
to action of the Company’s creditors, as provided in the Trust document, the
Committee shall reduce each Account for which the Trust held assets on a pro
rata basis to reflect such reduction in Trust assets, and the Company shall have
no obligation to replace such lost assets.

3.4 Trust Expenses. Expenses of the Trust which are not paid by the Company
shall be applied to reduce each Account for which the Trust holds assets on a
pro rata basis.

 

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ARTICLE IV

ACCOUNTS

4.1 Committee to Maintain Accounts. The Committee shall open and maintain a
separate Account with respect to each Award made under the Plan for purposes of
keeping a record of the number of Share Units credited as a result of the Award.

4.2 Accounting Procedures. The Committee shall establish and may amend from time
to time accounting procedures for the purpose of making allocations,
distributions, valuations and adjustments to Accounts provided for in this
Article IV. A Participant or Beneficiary shall have no contractual or other
right to have a particular accounting procedure or convention apply, or continue
to apply, and the Committee shall be free to alter any such procedure or
convention without obligation to any Participant or Beneficiary.

ARTICLE V

RIGHTS IN ACQUIRED STOCK

5.1 Power to Vote Stock Rests With Trustee. The power to vote any stock held by
the Trustee shall rest solely with the Trustee, who shall vote such stock in the
same proportion that the other shareholders vote their shares of stock of the
Company. For purposes of this Section 5.1, in determining how other shareholders
voted, the Trustee shall take into account the votes of shareholders with
respect to all classes of voting stock, including but not limited to Class A and
Class B Common Stock.

5.2 Tender Offers. In the case of a tender offer for the Company Stock, the
Trustee shall tender the shares of Company Stock held by the Trust only if more
than fifty percent (50%) of the shares of Company Stock held outside the Trust
are tendered by the shareholders.

5.3 Dividends. All Ordinary Dividends on Company Stock held in Trust shall be
held by the Trustee and reinvested as directed by the Committee. The Committee
shall allocate such Ordinary Dividends among the Accounts pro rata to the shares
allocated to each Account. The Capital Restructuring Dividend on Company Stock
held in Trust shall be immediately disbursed by the Trustee to the Company for
immediate distribution by the Company to Participants in accordance with
Section 6.6. No person (including, but not limited to, the Trustee, the Company,
the Committee or the Board) shall have the authority or ability to delay the
immediate transfer of the Capital Restructuring Dividend from the Trustee to the
Company pursuant to this Section 5.3.

ARTICLE VI

DISTRIBUTION OF ACCOUNTS

6.1 Time of Distribution. Subject to the acceleration provisions of Article VII,
a Participant’s Account shall be distributed as follows:

(a) With respect to Awards granted prior to January 1, 2005:

(1) If the Participant filed an election to receive distribution as an Award
vests in a manner prescribed by the Committee before the expiration of the
applicable election

 

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deadline as determined below with respect to the Award contained in the Account,
the Participant’s Account shall be distributed as it becomes vested, with each
payment to be made within a reasonable period of time following the date of
vesting of the portion of the Account to be paid; provided, however, that such
payments shall be made no later than the last day of the calendar year in which
the applicable vesting date occurs or, if later, the fifteenth day of the third
calendar month following the applicable vesting date. The applicable election
deadline was ninety (90) days following the date of the Award. Such election
shall be irrevocable. In addition to executing an election, the Participant may
also be required to execute an agreement with the Company, on a form prescribed
by the Committee, relating to the Company’s right of repurchase of Company
Stock, if any, and such other matters as the Committee shall prescribe.

(2) If the Participant failed to make the election described in
subsection (a)(1), the Participant’s Account shall be distributed in full within
a reasonable period of time following the seventh anniversary of the date of the
Award contained in such Account (but no later than the last day of the calendar
year in which the seventh anniversary occurs or, if later, the fifteenth day of
the third calendar month following the date of such seventh anniversary);
provided, however, that if the Participant has a Separation From Service prior
to such seventh anniversary, then the vested portion of the Participant’s
Account shall be distributed within a reasonable period of time following the
Separation From Service (but no later than the last day of the calendar year in
which the Separation From Service occurs or, if later, the fifteenth day of the
third calendar month following the date the Separation From Service occurs).

(b) With respect to Awards granted on or after January 1, 2006, the
Participant’s Account shall be distributed as it becomes vested, with each
payment to be made within a reasonable period of time following the date of
vesting of the portion of the Account to be paid; provided, however, that such
payments shall be made no later than the last day of the calendar year in which
the applicable vesting date occurs or, if later, the fifteenth day of the third
calendar month following the applicable vesting date.

(c) Notwithstanding the foregoing, if any stock of the Company is publicly
traded on an established securities market at the time of a Participant’s
Separation From Service, any distribution on account of the Separation From
Service of a Participant who is a “specified employee” under Code
Section 409A(a)(1)(B)(i) shall not be made before the earlier of (i) the date
which is six months after such Participant’s Separation From Service or (ii) the
date of the Participant’s death. For any twelve month period commencing April 1
and ending March 31, an Employee is a “specified employee” if the Employee was a
“key employee” at any time during the calendar year ending before such April 1.
A key employee is defined in Code Section 416(i) without regard to Code
Section 416(i)(5).

6.2 Form of Distribution. Each distribution shall be made in a lump sum and in
the form of Company Stock, except that fractional Share Units shall, as
determined according to procedures established by the Committee, be distributed
in kind as fractional shares or applied towards satisfying tax withholding
obligations with respect to Participants’ distributions. A Participant shall
have no right to request a cash distribution.

 

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6.3 Beneficiary Designation.

(a) Upon forms provided by the Committee, each Participant shall designate in
writing the Beneficiary or Beneficiaries whom such Participant desires to
receive the benefits of this Plan, if any, payable in the event of such
Participant’s death. A Participant may from time to time change his or her
designated Beneficiary or Beneficiaries without the consent of such Beneficiary
or Beneficiaries by filing a new designation in writing with the Committee. The
Committee may rely upon the designation of Beneficiary or Beneficiaries last
filed by the Participant in accordance with the terms of this Plan.

(b) If the designated Beneficiary does not survive the Participant, or if there
is no valid Beneficiary designation, amounts payable under the Plan shall be
paid to the Participant’s spouse, or if there is no surviving spouse, then to
the duly appointed and currently acting personal representative of the
Participant’s estate. If there is no personal representative of the
Participant’s estate duly appointed and acting in that capacity within sixty
(60) days after the Participant’s death, then all payments due under the Plan
shall be payable to the person or persons who can verify by affidavit or court
order to the satisfaction of the Committee that they are legally entitled to
receive the benefits specified hereunder pursuant to the laws of intestate
succession or other statutory provision in effect at the Participant’s death in
the state in which the Participant resided.

6.4 Distribution to Guardian. If the Committee shall find that any person to
whom any payment is payable under this Plan is unable to care for his or her
affairs because of illness or accident, or is a minor, a payment due (unless a
prior claim therefor shall have been made by a duly appointed guardian or other
legal representative) may be paid to the spouse, a child, a parent, or a brother
or sister, or to any custodian, conservator or other fiduciary responsible for
the management and control of such person’s financial affairs in such manner and
proportions as the Committee may determine. Any such payment shall be a complete
discharge of the liabilities of the Company and the Trust to the Participant or
Beneficiary under this Plan.

6.5 Withholding of Taxes. To the extent any distribution is subject to
withholding taxes, the Committee shall require, as a condition to the payment of
such distribution, that the taxes be withheld from such distribution. With
respect to amounts paid from the Trust, the Trustee shall deliver the withheld
amounts to the Company which shall pay over the withheld taxes as required by
law. The Committee may, but need not, allow the Participant to make payment to
the Company in the form of a check for such withholding taxes, and the Committee
may provide in its discretion for other methods of withholding acceptable to the
Company.

6.6 Distribution of Dividend Equivalents.

(a) Notwithstanding anything to the contrary in this Article VI, effective
January 1, 2006, Dividend Equivalents with respect to the Capital Restructuring
Dividend shall be distributed as set forth in this Section 6.6.

(b) Dividend Equivalents with respect to the Capital Restructuring Dividend
shall be distributed by the Company to Participants as soon as administratively
feasible upon the

 

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Company’s receipt of the Capital Restructuring Dividend from the Trustee in
accordance with Section 5.3. No one (including, but not limited to, the Trustee,
the Company, the Board, the Committee or any Participant) shall have the
authority or the ability to delay the immediate distribution of Dividend
Equivalents or alter the amount of Dividend Equivalents distributed with respect
to the Capital Restructuring Dividend. The distribution of Dividend Equivalents
with respect to the Capital Restructuring Dividend to be made to a Participant
in accordance with this Section 6.6(b) shall equal the product of (i) the
Participant’s Share Units as of the record date for the Capital Restructuring
Dividend, times (ii) the per share Capital Restructuring Dividend. Immediate
payment of the Dividend Equivalent upon the payment of the Capital Restructuring
Dividend by the Company is intended to satisfy the requirement of Code
Section 409A that payment be made as of a specified time or pursuant to a fixed
schedule.

(c) Distributions of Dividend Equivalents with respect to the Capital
Restructuring Dividend shall be made in cash without interest and shall be made
from the Capital Restructuring Dividend paid to the Trust and transferred to the
Company pursuant to Section 5.3.

ARTICLE VII

ACCELERATION OF DISTRIBUTION AND/OR VESTING

7.1 Change in Control. Every Account shall become fully vested and shall be
immediately distributed to the Participants to whom such Accounts belong, upon
the occurrence of a Change in Control (as hereinafter defined) of the Company. A
Change in Control shall be deemed to occur upon any “person” (as defined in
Section 3(a)(9) of the Securities Exchange Act of 1934 (the “Exchange Act”)),
other than the Company, a subsidiary or any employee benefit plan or trust
maintained by the Company or a subsidiary becoming the beneficial owner (as
defined in Rule 13d-3 under the Exchange Act), directly or indirectly, of more
than 25% of the Company Stock outstanding at such time, without the prior
approval of the Board. For purposes of the foregoing, a subsidiary is any
corporation in an unbroken chain of corporations beginning with the Company if
each of the corporations, other than the last corporation in such chain, owns at
least fifty percent (50%) of the total voting power in one of the other
corporations in such chain. Effective January 1, 2005, 35% shall be substituted
for 25% in the above definition of Change in Control, in accordance with Code
Section 409A.

7.2 Hardship.

(a) Prior to January 1, 2005, notwithstanding the provisions of Section 6.1
hereof, a Participant shall be entitled to request a hardship distribution of
all or any portion of the vested portion of his or her Account(s). A Participant
must make a written request for a hardship distribution, stating the reasons
such withdrawal is necessary because of a financial hardship. The Committee, in
its sole discretion, shall determine whether or not to grant the hardship
distribution of such Participant’s Account(s) and, in so doing, may rely on the
Participant’s statements, and a hardship distribution may be approved without
further investigation unless the Committee has reason to believe such statements
are false.

(b) Effective January 1, 2005, a withdrawal under this Section 7.2 shall be
permitted only if the Participant incurs an “unforeseeable emergency,” as
defined below. Any

 

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such distribution shall be limited to the amount of which distribution is
reasonably necessary to satisfy the emergency need (which may include amounts
necessary to pay any Federal, State or local income taxes or penalties
reasonably anticipated to result from the distribution). For purposes of this
Section 7.2(b), an “unforeseeable emergency” is a severe financial hardship of
the Participant resulting from (i) an illness or accident of the Participant,
the Participant’s spouse or dependent, (ii) the loss of the Participant’s
property due to casualty (including the need to rebuild a home following damage
to a home to te extent not otherwise covered by insurance), or (iii) other
similar extraordinary and unforeseeable circumstances arising as a result of
events beyond the control of the Participant. The determination of whether a
Participant has an unforeseeable emergency shall be made in accordance with the
authorities published pursuant to Code Section 409A.

ARTICLE VIII

PLAN TERMINATION AND AMENDMENT

8.1 Termination and Amendments. The Plan shall continue until all amounts have
been distributed in accordance with the terms of the Plan. Notwithstanding the
foregoing sentence, the Company retains the right to amend or terminate the Plan
for any reason, including but not limited to adverse changes in accounting rules
or tax laws or the bankruptcy, receivership or dissolution of the Company. In
the event of a Plan termination, benefits will be paid out when due under the
terms of the Plan. To the extent feasible, the Committee shall use its best
efforts to avoid adversely affecting the rights of any existing Participants in
the Plan, but prior to a Change in Control, the Committee shall be under no
specific duty or obligation in this regard. Following a Change in Control, no
amendment or termination of the Plan shall adversely affect any benefits earned
by Participants prior to the amendment or termination.

ARTICLE IX

PLAN ADMINISTRATION

9.1 Committee. The Plan shall be administered by the Committee. Subject to the
provisions of the Plan and the authority granted hereunder to the Awarding
Authority, the Committee shall have exclusive power to determine the manner and
time of Awards and payment of benefits to the extent herein provided and to
exercise any other discretionary powers granted to the Committee pursuant to the
Plan. The decisions or determinations by the Committee shall be final and
binding upon all parties, including shareholders, Participants, Beneficiaries
and other Employees. The Committee shall have the authority to interpret the
Plan, to make factual findings and determinations, to adopt and revise rules and
regulations relating to the Plan and to make any other determinations which it
believes necessary or advisable for the administration of the Plan. The
Committee’s discretion in these matters shall be as broad and unfettered as
permitted by law. Notwithstanding the foregoing, after a Change in Control, any
findings, adoption or revision of rules or regulations, interpretations,
decisions or determinations made by the Committee (including under Section 9.2)
shall not be given any deference by a court or arbitrator, and if challenged by
a Participant or Beneficiary, shall be reviewed on a de novo basis.

9.2 Committee Powers. The Committee shall have all powers necessary to supervise
the administration of the Plan and control its operations. In addition to any
powers and authority

 

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conferred on the Committee elsewhere in the Plan or by law, the Committee shall
have, by way of illustration and not by way of limitation, the following powers
and authority:

(a) To designate agents to carry out responsibilities relating to the Plan;

(b) To employ such legal, actuarial, medical, accounting, clerical and other
assistance as it may deem appropriate in carrying out the provisions of this
Plan;

(c) To administer, interpret, construe and apply this Plan and to decide all
questions which may arise or which may be raised under this Plan by any
Employee, Participant, Beneficiary or other person whomsoever, including but not
limited to all questions relating to eligibility to participate in the Plan,
determination of Awards and the amount of benefits to which any Participant may
be entitled;

(d) To establish rules and procedures from time to time for the conduct of its
business and for the administration and effectuation of its responsibilities
under the Plan;

(e) To establish claims procedures, and to make forms available for filing of
such claims, and to provide the name of the person or persons with whom such
claims should be filed. The Committee shall establish procedures for action upon
claims initially made and the communication of a decision to the claimant
promptly and, in any event, not later than sixty (60) days after the date of the
claim; the claim may be deemed by the claimant to have been denied for purposes
of further review described below in the event a written decision is not
furnished to the claimant within such sixty (60) day period. Every claim for
benefits which is denied shall be denied by written notice setting forth in a
manner calculated to be understood by the claimant (1) the specific reason or
reasons for the denial, (2) specific reference to any provisions of this Plan on
which denial is based, (3) description of any additional material or information
necessary for the claimant to perfect his claim with an explanation of why such
material or information is necessary, and (4) an explanation of the procedure
for further reviewing the denial of the claim under the Plan. The Committee
shall establish a procedure for review of claim denials, such review to be
undertaken by the Committee. The review given after denial of any claim shall be
a full and fair review with the claimant or his duly authorized representative
having one hundred eighty (180) days after receipt of denial of his claim to
request such review, having the right to review all pertinent documents and the
right to submit issues and comments in writing. The Committee shall establish a
procedure for issuance of a decision by the Committee not later than sixty
(60) days after receipt of a request for review from a claimant unless special
circumstances, such as the need to hold a hearing, require a longer period of
time, in which case a decision shall be rendered as soon as possible but not
later than one hundred twenty (120) days after receipt of the claimant’s request
for review. The decision on review shall be in writing and shall include
specific reasons for the decision written in a manner calculated to be
understood by the claimant with specific reference to any provisions of this
Plan on which the decision is based; and

(f) To perform or cause to be performed such further acts as it may deem to be
necessary, appropriate, or convenient in the efficient administration of the
Plan.

 

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Prior to a Change in Control, any action taken in good faith by the Committee in
the exercise of authority conferred upon it by this Plan shall be conclusive and
binding upon the Participants and their beneficiaries, and all discretionary
powers conferred upon the Committee shall be absolute. Following a Change in
Control, the actions of the Committee and its exercise of discretionary powers
shall be reviewed on a de novo basis if challenged by a Participant or
Beneficiary.

9.3 Plan Expenses. Members of the Committee shall serve as such without
compensation from the Plan, but may receive compensation from the Company for so
serving. All Plan administration expenses shall be borne by the Company or the
Trust as determined by the Committee in its sole discretion.

9.4 Reliance Upon Documents and Opinions. The members of the Committee, the
Awarding Authority, the Board, and the Company shall be entitled to rely upon
any tables, valuations, computations, estimates, certificates, opinions and
reports furnished by any consultant, or firm or corporation which employs one or
more consultants or advisors. The Committee may, but is not required to, rely
upon all records of the Company with respect to any matter or thing whatsoever,
and may likewise treat such records as conclusive with respect to all Employees,
Participants, Beneficiaries and any other persons whomsoever, except as
otherwise provided by law.

9.5 Requirement of Proof. The Committee, the Awarding Authority, the Board, or
the Company may require satisfactory proof of any matter under this Plan from or
with respect to any Employee, Participant or Beneficiary, and no such person
shall acquire any rights or be entitled to receive any benefits under this Plan
until such proof shall be furnished as so required.

9.6 Limitation on Liability. No employee or director of the Company and no other
person shall be subject to any liability by reason of or arising from his or her
participation in the establishment or administration or operation of the Plan
unless he or she acts fraudulently or in bad faith.

9.7 Indemnification.

(a) To the extent permitted by law, the Company shall indemnify each member of
the Awarding Authority, of the Committee, and any other employee or director of
the Company who was or is a party, or is threatened to be made a party, to any
threatened, pending or completed proceeding, whether civil, criminal,
administrative, or investigative, by reason of his or her conduct in the
performance in connection with the establishment or administration of the Plan
or any amendment or termination of the Plan.

(b) This indemnification shall apply against expenses including, without
limitation, attorneys fees and any expenses of establishing a right to
indemnification hereunder, judgments, fines, settlements and other amounts
actually and reasonably incurred in connection with such proceeding, except in
relation to matters as to which he or she has acted fraudulently or in bad faith
in the performance of such duties.

 

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(c) The termination of any proceeding by judgment, order, settlement,
conviction, upon a plea of nolo contendere or its equivalent shall not, in and
of itself, create a presumption that the person acted fraudulently or in bad
faith in the performance of his or her duties.

(d) Expenses incurred in defending any such proceeding may be advanced by the
Company prior to the final disposition of such proceeding, upon receipt of an
undertaking by or on behalf of the recipient to repay such amount, unless it
shall be determined ultimately that the recipient is entitled to be indemnified
as authorized in this Section 9.7.

(e) The right of indemnification set forth in this Section 9.7 shall be in
addition to any other right to which any Awarding Authority member, Committee
member or other person may be entitled as a matter of law, by corporate bylaws
or otherwise.

ARTICLE X

MISCELLANEOUS PROVISIONS

10.1 Restrictions on Plan Interest.

(a) A Participant’s interest in this Plan shall be limited to his or her Account
and he or she shall have no other interest in any assets of the Company nor any
right as against the Company, Awarding Authority or Committee for payment of
benefits under this Plan.

(b) None of the benefits, payments, proceeds, claims or rights hereunder of any
Participant or Beneficiary shall be subject to any claim of any creditor of such
Participant or Beneficiary and in particular the same shall not be subject to
attachment, garnishment, or other legal process by any creditor of such
Participant or Beneficiary.

(c) A Participant or Beneficiary shall not have any right to alienate,
anticipate, commute, pledge, encumber, or assign any of the benefits or payments
or proceeds which he or she may expect to receive, contingently or otherwise,
under the Plan.

(d) A Participant’s and Beneficiary’s interest in this Plan and the assets of
the Trust are subject to the claims of the Company’s creditors as provided in
the Trust. Each Participant and Beneficiary shall, however, be considered a
general creditor of the Company with respect to his or her Account, so that if
the Company should become insolvent, the Participant or Beneficiary will have a
claim against the Company and Trust assets equal to that of the Company’s other
general creditors (regardless of whether assets are removed from the Trust by a
trustee in bankruptcy).

(e) Whenever a provision of this Plan restricts or limits a Participant or a
Participant’s Account, benefit or distribution, such limitation shall also apply
to a Beneficiary unless otherwise specified.

 

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10.2 No Enlargement of Employee Rights.

(a) This Plan is strictly a voluntary undertaking on the part of the Company and
shall not be deemed to constitute a contract between the Company and any
Employee, or to be consideration for, or an inducement to, or a condition of,
the employment of any Employee.

(b) An Employee’s employment with the Company is not for any specified term and
may be terminated by such Employee or by the Company at any time for any reason,
with or without cause. Nothing in this Plan or in any agreement pursuant to this
Plan shall confer upon any Employee or Participant any right to continue in the
employ of or affiliation with the Company nor constitute any promise or
commitment by the Company regarding future positions, future work assignments,
future compensation or any other term or condition of employment or affiliation.

(c) No person shall have any right to any benefits under this Plan, except to
the extent expressly provided herein.

(d) The Plan is not intended to nor shall it be deemed to be a Plan providing
retirement income or resulting in the deferral of income by employees for
periods extending to the termination of covered employment or beyond.

10.3 Rights of Repurchase and First Refusal for the Company. Any Company Stock
distributed from the Plan may be subject to a right of repurchase and right of
first refusal by the Company, as well as any conditions, limitations, or
restrictions contained in any applicable agreement. The terms and conditions of
the right of repurchase and right of first refusal, to the extent applicable,
shall be in addition to those applied to Company Stock by the Restated
Certificate of Incorporation of Science Applications International Corporation,
as amended.

10.4 Mailing of Payments. All payments under the Plan shall be delivered in
person or mailed to the last address of the Participant (or, in the case of the
death of the Participant to that of any other person entitled to such payments
under the terms of the Plan). Each Participant shall be responsible for
furnishing the Committee with his or her correct current address and the correct
current name and address of his or her Beneficiary.

10.5 Inability to Locate Participant or Beneficiary. In the event that the
Committee is unable to locate a Participant or Beneficiary to whom benefits are
payable hereunder after mailing a notice to the Participant’s or Beneficiary’s
last known address, and such inability lasts for a period of three (3) years,
then any remaining benefits payable hereunder shall be forfeited to the Company
and no Participant or Beneficiary shall have any right to further benefits from
the Plan, even if subsequently located.

10.6 Governing Law. All legal questions pertaining to the Plan shall be
determined in accordance with the laws of the State of California, excluding its
rules governing conflict of laws. Without limiting Section 10.9, it is intended
that this Plan be administered and interpreted in a manner consistent with the
applicable requirements of Code Section 409A, and further that the Plan be
interpreted in a manner that satisfied the applicable requirements of Rule 16b-3

 

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promulgated under the Exchange Act, so that Awards will be entitled to the
benefits of Rule 16b-3 or other exemptive rules under Exchange Act and will not
be subject to avoidable liability thereunder.

10.7 Illegality of Particular Provision. If any particular provision of this
Plan shall be found to be illegal or unenforceable, such provision shall not
affect the other provisions thereof, but the Plan shall be construed in all
respect as if such invalid provision were omitted.

10.8 Interpretation. Section headings are for convenient reference only and
shall not be deemed to be part of the substance of this instrument or in any way
to enlarge or limit the contents of any article or section.

10.9 Tax Effects. The Company makes no representations or warranties as to the
tax consequences to a Participant or to a Participant’s Beneficiary from the
grant of Awards hereunder or the subsequent receipt of any benefits as a result
thereof. Each Participant must rely solely on his or her own tax advisor with
respect to the tax consequences arising from the grant of Awards or the receipt
of benefits hereunder, or from any other related transaction.

10.10 Receipt or Release. Any payment to any Participant or Beneficiary in
accordance with the provisions of this Plan shall, to the extent thereof, be in
full satisfaction of all claims against the Awarding Authority, the Committee
and the Company, and the Committee may require such Participant or Beneficiary,
as a condition precedent to such payment, to execute a receipt and release to
such effect.

10.11 Records. The records of the Company with respect to the Plan shall be
conclusive on all Participants, Beneficiaries, and all other persons whomsoever.

10.12 Arbitration. Any person disputing a decision of the Committee shall submit
such dispute to binding arbitration pursuant to the rules of the American
Arbitration Association, to be held in San Diego County. In any arbitration with
respect to a decision or action of the Committee taken before a Change in
Control, the losing party in such arbitration proceedings shall bear the costs
of arbitration, and each party shall bear its own attorneys’ fees. In any
arbitration with respect to a decision or action of the Committee taken after a
Change in Control, the Company shall bear the costs of arbitration (other than
attorneys’ fees), and the arbitrator may make an award of attorneys’ fees; any
such award shall be made according to the then-prevailing standards for judicial
awards of attorneys’ fees applicable to civil actions brought under the Employee
Retirement Income Security Act of 1974, as amended.

 

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SCIENCE APPLICATIONS INTERNATIONAL CORPORATION

STOCK COMPENSATION PLAN

Amendment No. One

Effective on and after September 17, 2009, the Science Applications
International Corporation Stock Compensation Plan is hereby amended by adding
the following new Section 10.13 to the Plan:

“10.13 Recoupment of Awards. Notwithstanding any other provision herein
including, but not limited to, Sections 2.2, 7.1, 8.1 and 10.1(b), and
notwithstanding any other provisions in any Award agreement with respect to this
Plan, Awards granted or paid under this Plan shall be subject to recoupment by
the Company pursuant to the Company’s recoupment policy originally adopted on
June 18, 2009 by the Human Resources and Compensation Committee of the Board, as
such policy may subsequently be amended (the “Recoupment Policy”). Although
consent to the Recoupment Policy by a Participant is not a prerequisite to the
effectiveness of the Recoupment Policy with respect to the Participant,
acceptance of an Award under this Plan shall be deemed to constitute consent by
the Participant to the terms and conditions of the Recoupment Policy with
respect to such Award and any and all prior Awards granted to the Participant
under this Plan. For purposes of clarity, to the extent provided by the
Recoupment Policy, a Participant may be required to return certain payments made
to the Participant with respect to an Award, and payments that otherwise would
have been made to the Participant with respect to an Award may be reduced or
entirely eliminated. Such actions may be taken pursuant to the Recoupment Policy
without regard to whether such payments and the Participant’s Awards were
otherwise vested.”

 

Science Applications International Corporation By:  

/s/ Joseph P. Walkush

  Joseph P. Walkush  

Executive Vice President