LARSON DAVIS INCORPORATED

                              AMENDED AND RESTATED

                        1996 DIRECTOR STOCK OPTION PLAN


     Larson Davis Incorporated, a Nevada corporation (the "Company"), adopts
this "1996 Director Stock Option Plan" (the "Plan"), effective as of May 9,
1996, as subsequently amended and restated, under which options to acquire stock
of the Company are granted to individuals who are serving as directors of the
Company, on the terms and conditions set forth herein.

     1.   Purpose of the Plan.  The Plan is intended to aid the Company in
maintaining and developing a management team, attracting qualified directors
capable of assisting in the future success of the Company, and rewarding those
individuals who have contributed to the success of the Company.  It is designed
to aid the Company in retaining the services of current directors and in
attracting new directors when needed for future operations and growth and to
provide such individuals with an incentive to remain directors of the Company,
to use their best efforts to promote the success of the Company's business, and
to provide them with an opportunity to obtain or increase a proprietary interest
in the Company.  The above aims will be effectuated through the granting of
options ("Options") to purchase shares of common stock of the Company, par value
$0.001 per share (the "Stock"), subject to the terms and conditions of this
Plan.

     2.   Shareholder Approval.  The Plan shall become effective immediately on
adoption by the board of directors of the Company (the "Board").  In addition,
the Plan shall be submitted for approval by the Company's shareholders in the
manner set forth below:

          (a)  The Plan shall be submitted for approval by those shareholders of
     the Company who are entitled to vote on such matters at the next duly held
     shareholders' meeting or approved by the written consent of the holders of
     a majority of the issued and outstanding Stock of the Company.  If the Plan
     is presented at a shareholders' meeting, it shall be approved by the
     affirmative vote of the holders of a majority of the issued and outstanding
     Stock in attendance, in person or by proxy, at such meeting.
     Notwithstanding the foregoing, the Plan may be approved by the shareholders
     in any other manner not inconsistent with the Company's articles of
     incorporation and bylaws, the applicable provisions of state corporate
     laws, and the applicable provisions of the Code and regulations adopted
     thereunder.

          (b)  In the event the Plan is so approved, the secretary of the
     Company shall, as soon as practicable following the date of final approval,
     prepare and attach to this Plan certified copies of all relevant
     resolutions adopted by the shareholders and the Board.  All Options
     previously granted under this Plan shall be deemed to have been granted as
     of the date of final approval by the board of directors.

     3.   Administration of the Plan.  Administration of the Plan shall be
determined by the Board.  Subject to compliance with applicable provisions of
the governing law, the Board may delegate administration of the Plan or specific
administrative duties with respect to the Plan, on such terms and to such
committees of the Board as it deems proper.  Any action taken with respect to
the Plan by the Board shall be approved by a majority vote of those members of
the Board in attendance at a meeting at which a quorum is present.  Any action
taken with respect to the Plan by a committee designated by the Board shall be
approved as specified by the Board at the time of delegation.  The
interpretation and construction of the terms of the Plan by the Board or a duly
authorized committee shall be final and binding on all participants in the Plan
absent a showing of demonstrable error.  No member of the Board or duly
authorized committee shall be liable for any action taken or determination made
in good faith with respect to the Plan.

     4.   Shares of Stock Subject to the Plan.  A total of 1,400,000 shares of
Stock may be subject to, or issued pursuant to, Options granted under the terms
of this Plan.  In calculating the number of shares, (i) any shares subject to an
Option under the Plan, which Option for any reason expires or is forfeited,
terminated, or surrendered unexercised as to such shares, shall be added back to
the total number of shares reserved for issuance under the terms of this Plan,
and (ii) if any right to acquire Stock granted under the Plan is exercised by
the delivery of shares of Stock or the relinquishment of rights to shares of
Stock, only the net shares of Stock issued (the shares of Stock issued less the
shares of Stock surrendered) shall count against the total number of shares
reserved for issuance under the terms of this Plan.

     5.   Term.  This Plan shall be in effect from the date hereof until close
of business May 9, 1999.

     6.   Grant to Board Members.  Each individual who is a member of the Board
as of the effective date of this Plan and each individual who becomes a member
of the Board during the term of this Plan shall be awarded an Option to acquire
200,000 shares of Stock at an exercise price equal to the closing bid price for
the Stock on the date of grant or the date of extension of an offer to become a
director, as designated by the Board at the time, as reported on the Nasdaq
Stock Market ("Nasdaq"), or, if the Stock is not then listed on Nasdaq, as
reported by another reliable quotation medium with respect to the principal
trading market for the Stock of the Company.

     7.   Reservation of Stock on Granting of Option.  At the time of granting
any Option under the terms of this Plan, there will be reserved for issuance on
the exercise of the Option the number of shares of Stock of the Company subject
to such Option.  The Company may reserve either authorized but unissued shares
or issued shares that have been reacquired by the Company.

     8.   Term of Options and Certain Limitations on Right to Exercise.

          (a)  The Options shall be exercisable with respect to the shares
     subject to such Options for a period of five years after the right to
     acquire such shares become vested as provided below.

          (b)  The term of the Option, once it is granted, may be reduced only
     as provided for in this Plan under the written provisions of the Option.

          (c)  Unless otherwise specifically provided by the written provisions
     of the Option, no holder or his or her legal representative, legatee, or
     distributee will be, or shall be deemed to be, a holder of any shares
     subject to an Option unless and until the holder exercises his or her right
     to acquire all or a portion of the Stock subject to the Option and delivers
     the required consideration to the Company in accordance with the terms of
     this Plan and then only to the extent of the number of shares of Stock
     acquired.  Except as specifically provided in this Plan or as otherwise
     specifically provided by the written provisions of the Option, no
     adjustment to the exercise price or the number of shares of Stock subject
     to the Option shall be made for dividends or other rights for which the
     record date is prior to the date the Stock subject to the Option is
     acquired by the holder.

          (d)  Options under the Plan shall vest and become exercisable twenty-
     five percent (25%) at the time of the grant of the Option and an additional
     twenty-five percent (25%) on each of the first three anniversaries of the
     original date of grant; provided that, the holder of the Option is a
     director of the Company as of such anniversaries.  If the holder is no
     longer a director of the Company for any reason, all unvested Options shall
     terminate and shall thereafter be null and void.

          (e)  If any individual who receives an Option under the terms of this
     Plan is terminated or resigns from the Company within six months of such
     Option being granted, the unexercised portion of the Option, whether or not
     vested, shall be null and void, and such individual shall have no further
     rights thereunder as of the date of such termination or resignation.

          (f)  In no event may an Option be exercised after the expiration of
     its term.

     9.   Payment of Exercise Price.  The exercise of any Option shall be
contingent on receipt by the Company of cash, certified bank check to its order,
or other consideration acceptable to the Company; provided that, payment may be
made in whole or in part in shares of Stock that have been held for at least six
months, valued at the then fair market value of the stock as determined by the
board of directors or a duly authorized committee.

     10.  Withholding.  If the grant or exercise of an Option pursuant to this
Plan is subject to withholding or other trust fund payment requirements of the
Code or applicable state or local laws, the holder of such Option must, as a
condition precedent to exercising the Options, deliver to the Company cash equal
to such withholding obligation or evidence satisfactory to the Company that such
withholding obligation has otherwise been met.

     11.  Awards to Directors and Officers.  To the extent the Company is
subject to section 16(b) of the Exchange Act, Options granted under the Plan to
directors and officers (as defined in Rule 16a-1 promulgated under the Exchange
Act or any amendment or successor rule of like tenor) intended to qualify for
the exemption from section 16(b) of the Exchange Act provided in Rule 16b-3
shall be subject to the following requirements, in addition to the other
restrictions and limitations set forth in this Plan:

          (a)  With respect to any award, the exercise price may not be less
     than the minimum required by applicable state law.

          (b)  An Option or, if exercised, the Stock acquired on exercise, may
     not be transferred prior to the date that is more than six months
     subsequent to the date of the grant of the Option.

          (c)  Any cash settlement of Options or surrender or withholding of
     shares of Stock to pay the exercise price of the Option, shall be made in
     accordance with the requirements of Rule 16b-3 or any amendment or
     successor rule of like tenor.

All of the foregoing restrictions and limitations are based on the governing
provisions of the Exchange Act and the rules and regulations promulgated
thereunder as of the date of adoption of this Plan.  If at any time the
governing provisions are amended to permit an Option to be granted or exercised
pursuant to Rule 16b-3 or any amendment or successor rule of like tenor without
one or more of the foregoing restrictions or limitations, or the terms of such
restrictions or limitations are modified, the Board or a duly authorized
committee may award Options to directors and officers, and may modify
outstanding Options, in accordance with such changes, all to the extent that
such action by the Board or a duly authorized committee does not disqualify the
Options from exemption under the provisions of Rule 16b-3 or any amendment or
successor rule of similar tenor.

     12.  Dilution or Other Adjustment.  In the event that the number of shares
of Stock of the Company from time to time issued and outstanding is increased
pursuant to a stock split or a stock dividend, the number of shares of Stock
then covered by each outstanding Option granted hereunder shall be increased
proportionately, with no increase in the total purchase price of the shares then
so covered, and the number of shares of Stock subject to the Plan shall be
increased by the same proportion.  In the event that the number of shares of
Stock of the Company from time to time issued and outstanding is reduced by a
combination or consolidation of shares, the number of shares of Stock then
covered by each outstanding Option granted hereunder shall be reduced
proportionately, with no reduction in the total purchase price of the shares
then so covered, and the number of shares of Stock subject to the Plan shall be
reduced by the same proportion.  In the event that the Company should transfer
assets to another corporation and distribute the stock of such other corporation
without the surrender of Stock of the Company, and if such distribution is not
taxable as a dividend and no gain or loss is recognized by reason of section 355
of the Code or any amendment or successor statute of like tenor, then the total
purchase price of the Stock then covered by each outstanding Option shall be
reduced by an amount that bears the same ratio to the total purchase price then
in effect as the market value of the stock distributed in respect of a share of
the Stock of the Company, immediately following the distribution, bears to the
aggregate of the market value at such time of a share of the Stock of the
Company plus the stock distributed in respect thereof.  In the event that the
Company distributes the stock of a subsidiary to its shareholders, makes a
distribution of a major portion of its assets, or otherwise distributes
significant portion of the value of its issued and outstanding Stock to its
shareholders, the number of shares then subject to each outstanding Option and
the Plan, or the exercise price of each outstanding Option, may be adjusted in
the reasonable discretion of the Board or a duly authorized committee.  All such
adjustments shall be made by the Board or duly authorized committee, whose
determination upon the same, absent demonstrable error, shall be final and
binding on all participants under the Plan.  No fractional shares shall be
issued, and any fractional shares resulting from the computations pursuant to
this section shall be eliminated from the respective Option Award.  No
adjustment shall be made for cash dividends, for the issuance of additional
shares of Stock for consideration approved by the Board, or for the issuance to
stockholders of rights to subscribe for additional Stock or other securities.

     13.  Assignment.  No Option granted under this Plan shall be transferable
other than by will or the laws of descent and distribution, pursuant to a
qualified domestic relations order as defined in the Code or to family members
of the Option holder or entities created for their benefit.  Except as permitted
by the foregoing, each Option granted under the Plan and the rights and
privileges thereby conferred shall not be transferred, assigned, pledged, or
hypothecated in any way (whether by operation of law or otherwise), and shall
not be subject to execution, attachment, or similar process.  On any attempt to
transfer, assign, pledge, hypothecate, or otherwise dispose of the Option, or of
any right or privilege conferred thereby, contrary to the provisions thereof, or
on the levy of any attachment or similar process on such rights and privileges,
the Option and such rights and privileges shall immediately become null and
void.

     14.  Listing and Registration of Shares.  Each Option shall be subject to
the requirement that if at any time the Board shall determine, in its sole
discretion, that it is necessary or desirable to list, register, or qualify the
shares covered thereby on any securities exchange or under any state or federal
law, or obtain the consent or approval of any governmental agency or regulatory
body 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 and until such listing, registration, consent, or
approval shall have been effected or obtained free of any conditions not
acceptable to the Board.

     15.  Options.  Options granted under the Plan shall be represented by a
written agreement which shall be executed by the Company and which shall contain
such terms and conditions as may be permitted under the terms of this Plan.

     16.  No Right of Employment.  Nothing contained in this Plan or any Option
shall be construed as conferring on a director, officer, or employee any right
to continue or remain as a director, officer, or employee of the Company or its
subsidiaries.

     17.  Amendment of the Plan.  This Plan may not be amended more than once
during any six month period, other than to comport with changes in the Code or
the Employee Retirement Income Security Act or the rules and regulations
promulgated thereunder.  Subject to the foregoing and, if the Company is subject
to the provisions of section 16(b) of the Exchange Act, the limitations of Rule
16b-3 promulgated under the Exchange Act or any amendment or successor rule of
like tenor, the Board or a duly authorized committee may modify and amend the
Plan in any respect; provided, however, that to the extent such amendment or
modification would cause the Plan to no longer comply with the applicable
provisions of the Exchange Act with respect to Options granted to officers or
directors under Rule 16b-3 or any amendment or successor rule of like tenor or
with the provisions of the Code governing incentive stock options as they may be
amended from time to time, such amendment or modification shall also be approved
by the shareholders of the Company.

     Subject only to the foregoing, the Plan shall be deemed to be automatically
amended as is necessary to maintain the Plan in compliance with the provisions
of Rule 16b-3 promulgated under the Exchange Act or any amendment or successor
rule of like tenor.

                                   ATTEST:



                                   Brian G. Larson, Chairman




                            SECRETARY'S CERTIFICATE

     The undersigned, the duly constituted and elected secretary of Larson Davis
Incorporated, hereby certifies that a duly constituted meeting of the
shareholders held on                , 1997, pursuant to notice and at which a
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quorum was present in accordance with the requirements of law and the Company's
articles of incorporation and bylaws, the foregoing 1996 Director Stock Option
Plan was approved by the affirmative vote of the holders of a majority of the
shares of common stock voted at such meeting.

     DATED this       day of                , 1997.
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                                   LARSON DAVIS INCORPORATED



                                   By
                                     Dan J. Johnson, Secretary