Exhibit 10.13
 
IEC ELECTRONICS CORP.

OPTION AWARD AGREEMENT
PURSUANT TO
2001 STOCK OPTION AND INCENTIVE PLAN

(Incentive Stock Option)

OPTION AWARD AGREEMENT, executed in duplicate as of the 12th day of August,
2003, between IEC Electronics Corp., a Delaware corporation (the "Company"), and
W. BARRY GILBERT, an officer of the Company (the "Optionee").

RECITALS:

A. In accordance with the provisions of the 2001 Stock Option and Incentive Plan
of the Company (the "Plan") and pursuant to a resolution duly adopted by the
Board of Directors of the Company on August 12, 2003, the Company is authorized
to execute and deliver this Agreement on the terms and conditions herein set
forth.

B. All capitalized terms in this Agreement shall have the meaning assigned to
them in the Plan.

NOW, THEREFORE, in consideration of the mutual covenants hereinafter set forth
and for other good and valuable consideration, the parties hereto agree as
follows:

1. Grant of Option. Subject to all the terms and conditions of the Plan and this
Agreement, the Company hereby grants to the Optionee as of August 12, 2003 (the
"Date of Grant") a Stock Option (the "Option") to purchase up to 275,000 shares
of common stock of the Company (such number being subject to adjustment as
provided in Section 10), $.01 par value, on the terms and conditions herein set
forth. In accordance with Section 422 of the Internal Revenue Code of 1986, as
amended, this Option shall be an incentive stock option to the extent that the
aggregate fair market value of shares which Optionee may purchase hereunder for
the first time in any calendar year (and under all such plans of the Company)
does not exceed $100,000. The Option shall be exercisable from time to time
during the option term specified in Section 3 at the Option Exercise Price
specified in Section 2.
 
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2. Option Exercise Price. The option exercise price per share of common stock
covered by this Option shall be $0.95.

3. Option Term. This Option shall expire at 5:00 p.m. (Eastern Time) on March
31, 2009 (the “Expiration Date”), unless sooner terminated in accordance with
Section 7.

4. Vesting and Exercise. This Option shall vest and be exercisable as follows:

(a) Vesting and Exercise.

(i) 55,000 shares at such time as the closing price of the Corporation’s common
stock as reported on the Over-the-Counter Bulletin Board or such other public
market on which the Corporation’s shares are then traded equals or exceeds $1.50
per share for 30 consecutive days at any time between the Date of Grant and
August 12, 2006;

(ii) 55,000 shares at such time as the closing price of the Corporation’s common
stock as reported on the Over-the-Counter Bulletin Board or such other public
market on which the Corporation’s shares are then traded equals or exceeds $2.00
per share for 30 consecutive days at any time between the Date of Grant and
August 12, 2006;

(iii) 55,000 shares at such time as the closing price of the Corporation’s
common stock as reported on the Over-the-Counter Bulletin Board or such other
public market on which the Corporation’s shares are then traded equals or
exceeds $3.00 per share for 30 consecutive days at any time between the Date of
Grant and August 12, 2006;

(iv) 55,000 shares at such time as the closing price of the Corporation’s common
stock as reported on the Over-the-Counter Bulletin Board or such other public
market on which the Corporation’s shares are then traded equals or exceeds $4.00
per share for 30 consecutive days at any time between the Date of Grant and
August 12, 2006; and
 
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(v) 55,000 shares at such time as the closing price of the Corporation’s common
stock as reported on the Over-the-Counter Bulletin Board or such other public
market on which the Corporation’s shares are then traded equals or exceeds $5.00
per share for 30 consecutive days at any time between the Date of Grant and
August 12, 2006

(b) Notwithstanding that the closing price of the Company’s common stock reaches
the specified performance targets set forth in (a) above, no installment of this
Option shall vest unless Optionee is employed as the Company’s Chief Executive
Officer on the date that the specified performance target has been met.

(c) Notwithstanding that the closing price of the Company’s common stock does
not reach the specified performance targets set forth in (a) above, this Option
shall become fully vested and exercisable after September 30, 2008 and may be
exercised, in whole or in part, from October 1, 2008 until March 31, 2009.

5. Non-Transferability of Option. This Option shall be exercisable during
Optionee’s lifetime only by Optionee and may not be sold, transferred, pledged,
assigned, or otherwise alienated or hypothecated, other than by Optionee’s will
or by the laws of descent and distribution. Any attempted assignment, transfer,
pledge, hypothecation, or other disposition of the Option contrary to the
provisions hereof, and the levy of any execution, attachment, or similar process
upon the Option, shall be null and void and without effect.

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6. Manner of Exercising Option.

(a) In order to exercise this Option with respect to all or any part of the
shares of Stock for which this Option is at the time exercisable, Optionee (or
any other person or persons exercising the Option) must take the following
actions:

(i) Execute and deliver to the Company a Notice of Exercise (“Notice”) (in the
form attached to this Agreement) for the shares of Stock for which the Option is
exercised, which Notice may require the Optionee to certify in a manner
acceptable to the Company that Optionee is in compliance with the terms and
conditions of the Plan and this Agreement; and
 
(ii) Pay the aggregate Option Exercise Price for the purchased shares in one or
more of the following forms:

(A) by cash, wire transfer or check made payable to the Company;

(B) in shares of Stock held by Optionee (or any other person or persons
exercising the Option) for at least six (6) months and valued at Fair Market
Value on the date of exercise; or

(C) through a special sale and remittance procedure pursuant to which Optionee
shall concurrently provide irrevocable instructions (I) to the approved
brokerage firms to effect the immediate sale of the purchased shares and remit
to the Company, out of the sale proceeds available on the settlement date,
sufficient funds to cover the aggregate Option Exercise Price payable for the
purchased shares plus all applicable federal, state and local income and
employment taxes required to be withheld by the Company by reason of such
exercise and (II) to the Company to deliver the certificates for the purchased
shares directly to such brokerage firm in order to complete the sales
transaction.
 
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Except to the extent the sale and remittance procedure is utilized in connection
with the Option exercise, payment of the Option Exercise Price must accompany
the Notice delivered to the Company in connection with the Option exercise.

In the event this Option is exercised by any person or persons other than the
Optionee, the Notice shall be accompanied by appropriate proof of the right of
such person or persons to exercise the Option.

(iii) Make appropriate arrangements with the Company for the satisfaction of all
federal, state and local income and employment tax withholding requirements
applicable to the Option exercise.

(b) As soon as practical after the date of exercise, the Company shall issue to
or on behalf of Optionee (or any other person or persons exercising this Option)
a certificate for the purchased shares of Stock, with the appropriate legends,
if any, affixed thereto.

(c) In no event may this Option be exercised for any fractional shares.

7. Termination of Employment.

If the Optionee has a Termination of Employment (as defined in the Plan), the
following provisions shall apply:

(a) Death. If the Optionee’s Termination of Employment is on account of death,
then this Option shall become fully vested and may be exercised, in whole or in
part, by the Optionee’s Designated Beneficiary (as defined in the Plan) at any
time on or before the earlier to occur of (x) the Expiration Date of the Option
and (y) the first anniversary of the date of such Termination of Employment.
 
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(b) Disability. If the Optionee’s Termination of Employment is on account of
Disability, unvested Options shall be forfeited, and Options, to the extent they
are vested on the date of Termination of Employment, may be exercised, in whole
or in part, by the Optionee at any time on or before the earlier to occur of (x)
the Expiration Date of the Option and (y) the first anniversary of the date of
such Termination of Employment.

(c) Cause. If the Optionee’s Termination of Employment is on account of cause,
all outstanding Options, vested and unvested, shall terminate and be forfeited
on the date of such Termination of Employment.

(d) Other Reasons. If the Optionee’s Termination of Employment is for any reason
other than those enumerated in Sections (a) through (c), unvested Options shall
be forfeited, and Options, to the extent they are vested on the date of
Termination of Employment, may be exercised, in whole or in part, by the
Optionee at any time on or before the earlier to occur of (x) the Expiration
Date of the Option and (y) three (3) months after the date of such Termination
of Employment.

(e) Death After Termination of Employment. If (i) the Optionee’s Termination of
Employment is for any reason other than death and (ii) the Optionee dies after
such Termination of Employment but before the date the Options must be exercised
as set forth in the preceding subsections, unvested Options shall be forfeited,
and any Options, to the extent they are vested on the date of the Optionee’s
death, may be exercised, in whole or in part, by the Optionee’s Designated
Beneficiary at any time on or before the earlier to occur of (x) the Expiration
Date of the Option and (y) the first anniversary of the date of death.

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8. Detrimental Activities.

(a) The Committee may cancel, rescind, suspend, withhold or otherwise limit or
restrict this Option at any time if Optionee is not in compliance with all
applicable provisions of this Agreement and the Plan, or if Optionee engages in
any “Detrimental Activity”. For purposes of this Agreement, “Detrimental
Activity” includes: (i) the rendering of services for any organization or
engaging directly or indirectly in any business which is or becomes competitive
with the Company, or which organization of business, or the rendering of
services to such organization or business, is or becomes otherwise prejudicial
to in conflict with the interests of the Company; (ii) the disclosure to anyone
outside the Company, or the use in other than the Company’s business, without
prior written authorization from the Company, of any confidential information or
material relating to the business of the Company, acquired by the Optionee
either during or after employment with the Company; (iii) activity that results
in termination of Optionee’s employment for cause; (iv) a violation of any
rules, policies, procedures or guidelines of the Company, including, but not
limited to, the Company’s Code of Conduct; (v) any attempt, directly or
indirectly, to induce any employee of the Company to be employed or perform
services elsewhere or any attempt, directly or indirectly, to solicit the trade
or business of any current or prospective customer, supplier or partner of the
Company or (vi) any other conduct or act determined by the Board of Directors to
be injurious, detrimental or prejudicial to any interest of the Company.

(b) Upon exercise of this Option, Optionee, if requested by the Company, shall
certify in a manner acceptable to the Company that Optionee is in compliance
with the terms and conditions of the Plan.
 
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(c) In the event Optionee fails to comply with the provisions of (i)-(vi) of
Section 8(a) prior to, or during the six months after, any exercise of this
Option, such exercise may be rescinded within two years thereafter. In the event
of any such rescission, Optionee shall pay to the Company the amount of any gain
realized or payment received as a result of the rescinded exercise, in such
manner and on such terms and conditions as may be required, and the Company
shall be entitled to set-off against the amount of any such gain any amount
owned to Optionee by the Company.

9. General Restriction. This Option shall be subject to the requirement that if
at any time the Board of Directors in its discretion shall determine that the
listing, registration or qualification of the shares subject to such Option on
any securities exchange or under any state or federal law, or the consent or
approval of any government regulatory body, is necessary or desirable as a
condition of, or in connection with, the granting of such Option or the issuance
or purchase of shares thereunder, such Option may not be exercised in whole or
in part unless such listing, registration, qualification, consent or approval
shall have been effected or obtained free of any conditions not acceptable to
the Board of Directors.

10. Option Adjustments; Change in Control. In the event of a stock dividend,
stock split or other change in corporate structure or capitalization affecting
the common stock or any other transaction (including, without limitation, an
extraordinary cash dividend) which, in the determination of the Compensation
Committee (the "Committee") of the Board of Directors, affects the common stock
such that an adjustment is required in order to preserve the benefits or
potential benefits intended to be made available under the Plan, then the
Committee, in its sole discretion, shall equitably adjust any or all of (i) the
number and kind of shares of stock subject to this Option, and (ii) the exercise
price with respect to the foregoing, provided that the number of shares subject
to this Option shall always be a whole number. In the event of a Change in
Control (as defined in the Plan) or a dissolution or liquidation of the Company,
this Option shall become fully vested and exercisable.
 
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11. Amendment to this Option Award Agreement. The Committee may modify or amend
this Option if it determines, in its sole discretion, that amendment is
necessary or advisable in the light of any addition to or change in the Internal
Revenue Code or in the regulations issued thereunder, or any federal or state
securities laws or other law or regulation, which change occurs after the date
of grant of this Option and by its terms applies to this Option. No amendment of
this Option, however, may, without the consent of the Optionee, make any changes
which would adversely affect the rights of such Optionee.

12. Notices. Notices hereunder shall be in writing and if to the Company shall
be delivered personally to the Secretary of the Company or mailed to its
principal office, 105 Norton Street, P.O. Box 271, Newark, New York 14513,
addressed to the attention of the Secretary and, if to the Optionee, shall be
delivered personally or mailed to the Optionee at Optionee’s address as the same
appears on the records of the Company.

13. Stockholder Rights. This Option does not confer upon the holder thereof any
rights as a stockholder of the Company until such person shall have exercised
the Option, paid the Option Exercise Price and become a holder of record of the
purchased shares of Stock

14. Interpretations of this Agreement. All decisions and interpretations made by
the Committee with regard to any question arising hereunder or under the Plan
shall be binding and conclusive on all persons having an interest in this
Option. The Option granted hereunder, and the common stock which may be issued
upon exercise thereof, are subject to the provisions of the Plan. In the event
there is any inconsistency between the provisions of this Agreement and those of
the Plan, the provisions of the Plan shall govern.
 
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15. Successors and Assigns. This Agreement shall bind and inure to the benefit
of the parties hereto and the successors and assigns of the Company and, to the
extent provided in Section 7, to the personal representatives, legatees and
heirs of the Optionee.

16. Disqualifying Disposition. In the event that Optionee shall sell or transfer
any shares of common stock acquired upon the exercise of this Option prior to
the later of (a) two (2) years from the Date of Grant or (b) one (1) year from
the date of exercise of the Option, Optionee agrees to so advise the Company
immediately and to promptly pay to the Company the amount of any federal, state
or local taxes that may be required.

IN WITNESS WHEREOF, the Company has caused this Option Award Agreement to be
executed on the day and year first above written.

IEC ELECTRONICS CORP.
 
By:
     
David J. Beaubien
Chairman, Compensation Committee

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ACCEPTANCE

I, W. BARRY GILBERT, hereby certify that I have read and fully understand the
foregoing Option Award Agreement. I acknowledge that I have been apprised that
it is the intent of the Company that Optionees obtain and retain an equity
interest in the Company. I hereby execute this Option Award Agreement to
indicate my acceptance of this Option and my intent to comply with the terms
thereof.

     
Optionee
      
Street Address
      
City
State 
Zip Code

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EXHIBIT A

_________________, 20__

IEC Electronics Corp.
105 Norton Street
P. O. Box 271
Newark, NY 14513

Attention: Secretary

Dear Sir:

This is to notify you that I hereby elect to exercise my option rights
to_____________shares of common stock of IEC Electronics Corp. (the "Company")
granted under the Option Award Agreement (the "Agreement"),
dated__________________________, 20__, issued to me pursuant to the 2001 Stock
Option and Incentive Plan (the "Plan"). The option exercise price pursuant to
such Agreement, as adjusted, is $____________ per share or $__________ in the
aggregate.

In payment of the full option exercise price, I enclose (please complete as
appropriate):

(a)
my check payable to IEC Electronics Corp. in the amount of $__________.

 
(b)
__________ shares of common stock of the Company owned by me for at least six
months, free of any liens or encumbrances and having a fair market value of
$_________.

 
(c)
an authorization letter which gives irrevocable instructions to the Company to
deliver the stock certificates representing the shares for which the option is
being exercised directly to ______________ (name and address of broker) together
with a copy of the instructions to _______________ (name of broker) to sell such
shares and promptly deliver to the Company the portion of the proceeds equal to
the total purchase price and withholding taxes due, if any.

I hereby certify that I am in compliance with the terms and conditions of the
Plan and the Agreement.

Very truly yours,
       
Optionee's Signature

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