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                                                                    EXHIBIT 10.6


                            DIAMETRICS MEDICAL, INC.
                              AMENDED AND RESTATED
                        1993 DIRECTORS' STOCK OPTION PLAN

         1. Purpose of the Plan. The purpose of this Diametrics Medical, Inc.
1993 Directors' Stock Option Plan is to attract and retain the best available
individuals for service as Directors of the Company and provide additional
incentive to the Outside Directors of the Company to serve as Directors.

         None of the options granted hereunder shall be "incentive stock
options" within the meaning of Section 422 of the Code (as hereinafter defined).

         2. Definitions. As used herein, the following definitions shall apply:

            (a) "Board" shall mean the Board of Directors of the Company.

            (b) "Code" shall mean the Internal Revenue Code of 1986, as amended.

            (c) "Common Stock" shall mean the Common Stock of the Company.

            (d) "Company" shall mean Diametrics Medical, Inc., a Minnesota
corporation.

            (e) "Continuous Status as a Director" shall mean the absence of any
interruption or termination of service as a Director.

            (f) "Director" shall mean a member of the Board.

            (g) "Employee" shall mean any person, including officers and
Directors, employed by the Company or any parent or Subsidiary of the Company.
The payment of a Director's fee by the Company shall not be sufficient in and of
itself to constitute "employment" by the Company.

            (h) "Exchange Act" shall mean the Securities Exchange Act of 1934,
as amended.

            (i) "Option" shall mean a stock option granted pursuant to the Plan.

            (j) "Option Value" shall mean, with respect to an option described
in Section 4(b)(iv) of the Plan, the value of such option determined on the date
of grant using the same methodology as was used by the Company's independent
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accountants to value stock options for the purposes of the Company's most recent
annual audited financial statements.

            (k) "Optioned Stock" shall mean the Common Stock subject to an
Option.

            (l) "Optionee" shall mean an Outside Director who receives an
Option.

            (m) "Outside Director" shall mean a Director who is not an Employee.

            (n) "Parent" shall mean a "parent corporation," whether now or
hereafter existing, as defined in Section 425(e) of the Code.

            (o) "Plan" shall mean this 1993 Directors' Stock Option Plan.

            (p) "Shares" shall mean shares of the Common Stock, as adjusted in
accordance with Section 11 of the Plan.

            (q) "Subsidiary" shall mean a "subsidiary corporation," whether now
or hereafter existing, as defined in Section 425(f) of the Code.

         3. Stock Subject to the Plan. Subject to the provisions of Section 10
of the Plan, the maximum aggregate number of Shares which may be optioned and
sold under the Plan is 367,500 Shares of Common Stock. The Shares may be
authorized, but unissued, or reacquired Common Stock.

         If an Option should expire or become unexercisable for any reason
without having been exercised in full, the unpurchased Shares which were subject
thereto shall, unless the Plan shall have been terminated, become available for
future grant under the Plan. If Shares which were acquired upon exercise of an
Option are subsequently repurchased by the Company, such Shares shall not in any
event be returned to the Plan and shall not become available for future grant
under the Plan.

         4. Administration of and Grants of Options under the Plan.

            (a) Administrator. Except as otherwise required herein, the Plan
shall be administered by the Board.

            (b) Procedure for Grants. The provisions set forth in this Section
4(b) shall not be amended more than once every six months, other than to comport
with changes in the Code, the Employee Retirement Income Security Act of 1974,
as

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amended, or the rules thereunder. All grants of Options hereunder shall be made
in accordance with the following provisions:

                (i) The Board shall have discretion to grant options to Outside
         Directors in addition to the Options described in Sections 4(b)(ii),
         (iii) and (iv) and to determine the number of Shares to be covered by
         such Options.

                (ii) Effective August 14, 1997, each Outside Director shall be
         automatically granted an Option (an "Initial Grant") to purchase 18,000
         Shares on the date on which such person first becomes a Director,
         whether through election by the shareholders of the Company or
         appointment by the Board of Directors to fill a vacancy. Options
         granted under this section 4(b)(ii) shall become vested and thereby
         exercisable with respect to 50% of such Initial Grant on the twelve
         month anniversary date of such Initial Grant and with respect to 25% at
         each successive anniversary date; provided, however, an unvested
         portion of an Initial Grant shall only vest so long as the Outside
         Director remains a Director on the date such portion vests.

                (iii) Effective August 14, 1997, each Outside Director shall
         automatically receive, on the date of each Annual Meeting of
         Shareholders, an Option to purchase 8,000 Shares of the Company's
         Common Stock, such Option to become exercisable six months subsequent
         to the date of grant; provided however, that such Option shall only be
         granted to Outside Directors who have served since the date of the last
         Annual Meeting of Shareholders and will continue to serve after the
         date of grant of such Option.

                (iv) Each Outside Director may elect, not later than the last
         day of the Company's fiscal year, to be granted Options in lieu of the
         compensation and fees otherwise payable to such Outside Director for
         the next fiscal year. Such Options shall be granted quarterly on the
         last day of each fiscal quarter in which such compensation and fees are
         earned, to be exercisable immediately. The number of Shares covered by
         each such Option shall be the number determined by dividing the total
         amount of compensation and fees payable at the end of such quarter by
         the Option Value of one such Share on the date of grant.

                (v) The terms of an Option granted hereunder shall be as
         follows:

                    (A) the term of the Option shall be ten (10) years.


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                    (B) the Option shall be exercisable only while the Outside
               Director remains a Director of the Company, except as set forth
               in Section 8 hereof.

                    (C) the exercise price per Share shall be 100% of the fair
               value per Share on the date of grant of the Option.

                    (D) to the extent necessary to comply with the applicable
               provisions of Rule 16b-3 promulgated under the Exchange Act
               ("Rule 16b-3"), no Option will be exercisable until a date more
               than six months subsequent to the date of the grant of that
               Option.

            (c) Powers of the Board. Subject to the provisions and restrictions
of the Plan, the Board shall have the authority, in its discretion: (i) to
determine, upon review of relevant information and in accordance with Section
7(b) of the Plan, the fair market value of the Common Stock; (ii) to determine
the exercise price per share of Options to be granted, which exercise price
shall be determined in accordance with Section 7(a) of the Plan; (iii) to
interpret the Plan; (iv) to prescribe, amend and rescind rules and regulations
relating to the Plan; (v) to authorize any person to execute on behalf of the
Company any instrument required to effectuate the grant of an Option previously
granted hereunder; and (vi) to make all other determinations deemed necessary or
advisable for the administration of the Plan.

            (d) Effect of Board's Decision. All decisions, determinations and
interpretations of the Board shall be final and binding on all Optionees and any
other holders of any Options granted under the Plan.

         5. Eligibility. Options may be granted only to Outside Directors. All
Options shall be automatically granted in accordance with the terms set forth in
Section 4(b) hereof.

         The Plan shall not confer upon any Optionee any right with respect to
continuation of service as a Director or nomination to serve as a Director, nor
shall it interfere in any way with any rights which the Director or the Company
may have to terminate his directorship at any time.

         6. Term of Plan. The Plan shall become effective upon the earlier of
(i) its adoption by the Board or (ii) its approval by the shareholders of the
Company as described in Section 16 of the Plan. It shall continue in effect for
a term of ten (10) years unless sooner terminated under Section 12 of the Plan.


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         7. 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 100% of the fair market
value per Share on the date of grant of the Option.

            (b) Fair Market Value. The fair market value ("Fair Market Value")
of a Share shall be determined by the Board in its discretion; provided however,
that where there is a public market for the Common Stock, the fair market value
per Share shall be the closing price of the Common Stock in the over-the-counter
market on the date of grant, as reported in The Wall Street Journal (or, if not
so reported, as otherwise reported by the National Association of Securities
Dealers Automated Quotation ("NASDAQ") System) or, in the event the Common Stock
is traded on the NASDAQ National Market System or listed on a stock exchange,
the fair market value per Share shall be the closing price on such system or
exchange on the date of grant of the Option, as reported in The Wall Street
Journal.

            (c) Form of Consideration. Subject to compliance with applicable
provisions of Section 16(b) of the Exchange Act, (or other applicable law), the
consideration to be paid for the Shares to be issued upon exercise of an Option,
including the method of payment, shall be determined by the Board and may
consist entirely of (i) cash, (ii) check, (iii) other Shares which (X) 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 (Y) have a Fair
Market Value on the date of exercise equal to the aggregate exercise price of
the Shares as to which said Option shall be exercised, (iv) authorization for
the Company to retain from the total number of Shares as to which the Option is
exercised that number of Shares having a Fair Market Value on the date of
exercise equal to the exercise price for the total number of Shares as to which
the Option is exercised, (v) delivery of a properly executed exercise notice
together with irrevocable instructions to a broker to promptly deliver to the
Company the amount of sale or loan proceeds required to pay the exercise price,
(vi) by delivering an irrevocable subscription agreement for the Shares which
irrevocably obligates the option holder to take and pay for the Shares not more
than twelve months after the date of delivery of the subscription agreement,
(vii) any combination of the foregoing methods of payment or (viii) such other
consideration and method of payment for the issuance of Shares as may be
permitted under applicable laws. In making its determination as to the type of
consideration to accept, the Board shall consider whether acceptance of such
consideration may be reasonably expected to benefit the Company.


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         8. Exercise of Option.

            (a) Procedure for Exercise; Rights as a Shareholder. Any Option
granted hereunder shall be exercisable at such times as are set forth in Section
4(b) hereof; provided however, that no Options shall be exercisable until
shareholder approval of the Plan in accordance with Section 16 hereof has been
obtained.

         An Option may not be exercised for a fraction of a Share.

         An Option shall be deemed to be exercised when written notice of such
exercise has been given to the Company in accordance with the terms of the
Option by the person entitled to exercise the Option and full payment for the
Shares with respect to which the Option is exercised has been received by the
Company. Full payment may consist of any consideration and method of payment
allowable under Section 7(c) of the Plan. 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 stock certificate evidencing such 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. A share certificate for the number of 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 the stock certificate is issued, except as provided in
Section 10 of the Plan.

         Exercise of an Option in any manner shall result in a decrease in the
number of Shares which thereafter may be 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 Status as a Director. If an Outside Director
ceases to serve as a Director, he may, but only within seven (7) months after
the date he ceases to be a Director of the Company, exercise his Option to the
extent that he was entitled to exercise it at the date of such termination. To
the extent that he was not entitled to exercise an Option at the date of such
termination, or if he does not exercise such Option (which he was entitled to
exercise) within the time specified herein, the Option shall terminate.

            (c) Disability of Optionee. Notwithstanding the provisions of
Section 8(b) above, in the event an Optionee is unable to continue his service
as a Director with the Company as a result of his total and permanent disability
(as defined in Section 22(e)(3) of the Code) he may, but only within seven (7)
months from the date of termination, exercise his Option to the extent he was
entitled to exercise it at the date of such termination. To the extent that he
was not entitled to exercise the Option at the

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date of termination, or if he does not exercise such Option (which he was
entitled to exercise) within the time specified herein, the Option shall
terminate.

            (d) Death of Optionee. Notwithstanding the provisions of Section
4(b), in the event of the death of an Optionee:

                (i) during the term of the Option who is at the time of his
         death a Director of the Company and who has been in Continuous Status
         as a Director since the date of grant of the Option, the Option may be
         exercised, at any time within seven (7) months following the date of
         death, by the Optionee's estate or by a person who acquired the right
         to exercise the Option by bequest or inheritance, but only to the
         extent of the right to exercise that would have accrued had the
         Optionee continued living and remained in Continuous Status as a
         Director for six (6) months after the date of death; or

                (ii) within thirty (30) days after the termination of Continuous
         Status as a Director, the Option may be exercised, at any time within
         seven (7) months following the date of death, by the Optionee's estate
         or by a person who acquired the right to exercise the Option by bequest
         or inheritance, but only to the extent of the right to exercise that
         had accrued at the date of termination.

         9. Non-Transferability of Options. The Option may not be sold, pledged,
assigned, hypothecated, transferred, or disposed of in any manner other than (i)
by will, (ii) by the laws of descent or distribution, (iii) to members of the
Optionee's immediate family or (iv) to one or more trusts for the benefit of the
Optionee or members of his or her immediate family, and the Option may be
exercised, during the lifetime of the Optionee, only by the Optionee or a
permitted transferee.

         10. Adjustments Upon Changes in Capitalization, Dissolution or Merger.

            (a) In the event that the number of outstanding shares of Common
Stock of the Company is changed by a stock dividend, stock split, reverse stock
split, combination, reclassification or similar change in the capital structure
of the Company without consideration, the number of Shares available under this
Plan and the number of Shares subject to outstanding Options and the exercise
price per share of such Options shall be proportionately adjusted, subject to
any required action by the Board or shareholders of the Company and compliance
with applicable securities laws; provided however, that no certificate or scrip
representing fractional shares shall be issued upon exercise of any Option and
any resulting fractions of a Share shall be ignored. Such adjustment shall be
made by the Board, whose determination in that respect shall be final, binding
and conclusive.


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            (b) In the event of a dissolution or liquidation of the Company, a
merger in which the Company is not the surviving corporation, a transaction or
series of related transactions in which 100% of the then outstanding voting
stock is sold or otherwise transferred, or the sale of substantially all of the
assets of the Company, any or all outstanding Options shall, notwithstanding any
contrary terms of the written agreement governing such Option, accelerate and
become exercisable in full at least ten days prior to (and shall expire on) the
consummation of such dissolution, liquidation, merger or sale of stock or sale
of assets on such conditions as the Board shall determine unless the successor
corporation assumes the outstanding Options or substitutes substantially
equivalent options.

         11. Time of Granting Options. The date of grant of an Option shall, for
all purposes, be the date determined in accordance with Section 4(b) hereof.
Notice of the determination shall be given to each Outside Director to whom an
Option is so granted within a reasonable time after the date of such grant.

         12. Amendment and Termination of the Plan.

            (a) Amendment and Termination. The Board may at any time amend,
alter, suspend, or discontinue the Plan, but no amendment, alteration,
suspension, or discontinuance shall be made which would impair the rights of any
Optionee under any grant theretofore made, without his or her consent. In
addition, to the extent necessary and desirable to comply with Rule 16b-3 under
the Exchange Act (or any other applicable law or regulation), the Company shall
obtain shareholder approval of any Plan amendment in such a manner and to such a
degree as required.

            (b) Effect of Amendment or Termination. Any such amendment or
termination of the Plan shall not affect Options already granted and such
Options shall remain in full force and effect as if this Plan had not been
amended or terminated, unless mutually agreed otherwise between the Optionee and
the Board, which agreement must be in writing and signed by the Optionee and the
Company.

         13. Conditions Upon Issuance of Shares. Shares shall not be issued
pursuant to the exercise of an Option unless the exercise of such Option and the
issuance and delivery of such Shares pursuant thereto shall comply with all
relevant provisions of law, including, without limitation, the Securities Act of
1933, as amended, the Exchange Act, the rules and regulations promulgated
thereunder, state securities laws, and the requirements of any stock exchange
upon which the Shares may then be listed, and shall be further subject to the
approval of counsel for the Company with respect to such compliance.


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         As a condition to the exercise of an Option, the Company may require
the person exercising such Option 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 by any of
the aforementioned relevant provisions of law.

         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.

         14. Reservation of Shares. The Company, during the term of this Plan,
will at all times reserve and keep available such number of the Shares available
for issuance pursuant to this Plan as shall be sufficient to satisfy the
requirements of the Plan.

         15. Option Agreement. Options shall be evidenced by written option
agreements in such form as the Board shall approve.

         16. Shareholder Approval.

            (a) The Plan shall be subject to approval by the shareholders of the
Company within twelve (12) months of its adoption by the Board. If such
shareholder approval is obtained at a duly held shareholders' meeting, it may be
obtained by the affirmative vote of the holders of a majority of the outstanding
shares of the Company present or represented and entitled to vote thereon. If
such shareholder approval is obtained by written consent, it may be obtained by
the written consent of the holders of a majority of the outstanding shares of
the Company.

            (b) Any required approval of the shareholders of the Company shall
be substantially in accordance with Section 14(a) of the Exchange Act and the
rules and regulations promulgated thereunder.

         17. Information to Optionees. The Company shall provide to each
Optionee, during the period for which such Optionee has one or more Options
outstanding, copies of all annual reports to shareholders, proxy statements and
other information provided to all shareholders of the Company.



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