Exhibit
      10.16

    


    Form
      of First Amendment to Challenge Award

    Option
      Agreement Dated as of September 29, 2006

    


    IEC
      Electronics Corp.

    First
      Amendment to Option Award Agreement

    


    First
      Amendment, dated as of September 29, 2006 (this “Amendment”) to the Option Award
      Agreement, dated as of __________, 2005, (the “Option Agreement”) between IEC
      Electronics Corp., a Delaware corporation (the “Company”) and
      ________________________________________________ (the “Optionee”).

    


    RECITALS:

    


    
      	 	
              A.

            	
              In
                accordance with the provisions of the 2001 Stock Option and Incentive
                Plan
                (the “Plan”) and pursuant to resolutions duly adopted by the Board of
                Directors of the Company on _________ 2005, the Company and Optionee
                executed an Option Agreement, a copy of which is attached hereto
                as
                Exhibit A, pursuant to which Optionee was granted a Stock Option
                (the
                “Option”) to purchase up to ___________ shares of common stock of the
                Company in accordance with the terms and conditions set forth in
                the
                Option Agreement.

            


    

    


    
      	 	
              B.

            	
              As
                of the date of this Amendment, no options have
                vested.

            


    

    


    
      	 	
              C.

            	
              The
                Company and Optionee desire to modify certain provisions of the Option
                Agreement in the manner set forth
                herein.

            


    

    


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

    


    
      	
            	1.	
              Definitions.
                Capitalized
                terms used and not otherwise defined herein shall have the meanings
                ascribed to such terms in the Option
                Agreement.

            


    

    


    
      	 	
              2.

            	
              Amendments.

            


    

    


    
      	 	
              A.

            	
              Section
                4 (b) of the Option Agreement is deleted in its entirety and replaced
                with
                the following:

            


    

    


    
      	
            	 	
              (b)
                Notwithstanding the vesting schedule set forth in Section 4 (a),
                if the
                performance goal set forth in Section 4 (a) (i) is not achieved for
                the
                fiscal year ending September 30, 2006, the shares provided for in
                such
                subsection shall be added to the number of shares provided for in
                Section
                4 (a) (ii), making a total of [33.34% of the Award shares] that will
                vest
                and be exercisable if the Company’s Net Sales for the fiscal year ending
                September 30, 2007 equal or exceed $35 Million. If the Company’s Net Sales
                for the fiscal year ending September 30, 2007 equal $30 Million but
                are
                less than $35 Million, the shares will vest and be exercisable as
                follows:

            


    

    


    
      	
            	(a)	
              [16.67%
                of the Award shares] if the Company’s Net Sales equal $30 Million
                

            


    

     

    
      	
            	(b)	
              ___
                shares for each $100 of the Company’s Net Sales above $30 Million but less
                than $35 Million. Fractional shares shall be rounded to the nearest
                whole
                share.

            


    

     

    
      	
            	(c)	
              [33.34%
                of the Award shares] if the Company’s Net Sales equal or exceed $35
                Million.

            


    

    


    Unless
      otherwise changed by the Board of Directors, to the extent that the [33.34%
      of
      the Award shares] have not vested and become exercisable at September 30, 2007
      pursuant to the foregoing schedule, they will automatically be forfeited at
      the
      end of such fiscal year.

     

    
      
        
        

      

      
        1

        
          

        

      

      
        
        

      

    

    


    If
      the
      performance goals set forth in Sections 4 (a) (iii) and (iv) above are not
      achieved by September 30, 2010, the shares provided for in Sections 4 (a) (iii)
      or (iv), or both, as the case may be, will automatically be forfeited as of
      September 30, 2010.

    


    
      	 	
              3.

            	
              Except
                as otherwise provided herein, the Option Agreement shall be unmodified
                and
                shall continue in full force and effect in accordance with its
                terms.

            


    

    


    IN
      WITNESS WHEREOF, the parties hereto have caused this Amendment to be duly
      executed and delivered as of the day and year first above
      written.


    


    
      	
              IEC
                Electronics Corp.

            
	 	 
	
              By:
                

            	 



    

     

    
      	
              Optionee:
                

            	 
	 


    

     

    
      
        
        

      

      
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