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                                                       EXHIBIT 10.3c

                            HYTEK MICROSYSTEMS, INC.
                             1991 STOCK OPTION PLAN

                      (Adopted by the Board of Directors and
        initially approved by the shareholders on May 10, 1991; amended 
       on July 27, 1992 and May 12, 1995; amended on February 7, 1997(1))

          1.   PURPOSES OF THE PLAN.  The purposes of this 1991 Stock Option 
Plan are to attract and retain the best available personnel for positions of 
substantial responsibility, to provide additional incentive to Employees and 
Consultants of the Company and its Subsidiaries and to promote the success of 
the Company's business.  Options granted under the Plan may be incentive 
stock options (as defined under Section 422 of the Code) or non-statutory 
stock options, as determined by the Administrator at the time of grant of an 
option and subject to the applicable provisions of Section 422 of the Code 
and the regulations promulgated thereunder.

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

          (a)  "ADMINISTRATOR" means the Board or any of its Committees as 
shall be administering the Plan, in accordance with Section 4 of the Plan.

          (b)  "BOARD" means the Board of Directors of the Company.

          (c)  "CODE" means the Internal Revenue Code of 1986, as amended 
from time to time, and any successor thereto.

          (d)  "COMMITTEE" means a Committee, if any, appointed by the Board 
in accordance with paragraph (a) of Section 4 of the Plan.

          (e)  "COMMON STOCK" means the Common Stock, no par value per share, 
of the Company.

          (f)  "COMPANY" means Hytek Microsystems, Inc., a California 
corporation.

          (g)  "CONSULTANT" means any person, including an advisor, who is 
engaged by the Company or any Parent or Subsidiary to render services and is 
compensated for such services, provided the term Consultant shall not include 
persons who are not compensated for their services or are paid only a 
Director's fee by the Company.

---------------
(1) Subject to shareholder approval at the May 16, 1997 Annual Meeting of 
Shareholders.


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          (h)  "CONTINUOUS STATUS AS AN EMPLOYEE OR CONSULTANT" means the 
absence of any interruption or termination of service as an Employee or 
Consultant.  Continuous Status as an Employee or Consultant shall not be 
considered interrupted in the case of:  (i) any leave of absence approved by 
the Administrator, including sick leave, military leave, or any other 
personal leave; provided, however, that for purposes of Incentive Stock 
Options, any such leave may not exceed ninety (90) days, unless reemployment 
upon the expiration of such leave is guaranteed by contract (including 
certain Company policies) or statute; or (ii) transfers between locations of 
the Company or between the Company, its Parent, its Subsidiaries or its 
successor.

          (i)  "DIRECTOR" shall mean a member of the Board.

          (j)  "DISABILITY" means total and permanent disability, as defined in
Section 22(e)(3) of the Code.

          (k)  "EMPLOYEE" means any person, including Officers and Directors,
employed by the Company or any Subsidiary.  The payment of Directors' fees by
the Company shall not be sufficient to constitute "employment" by the Company.
 
          (l)  "EXCHANGE ACT" means the Securities Exchange Act of 1934, as
amended.

          (m)  "FAIR MARKET VALUE" means, as of any date, the value of Common
Stock determined as follows:

                    (i)  If the Common Stock is listed on any established 
stock exchange or a national market system, including without limitation the 
National Market System of the National Association of Securities Dealers, 
Inc. Automated Quotation ("NASDAQ") System, the Fair Market Value of a Share 
of Common Stock shall be the closing sales price for such stock (or the 
closing bid, if no sales were reported) as quoted on such exchange (or, if 
listed on more than one exchange, the exchange with the greatest volume of 
trading in Common Stock) or system on the last market trading day prior to 
the day of determination, as reported in the Wall Street Journal or such 
other source as the Administrator deems reliable;

                (ii)     If the Common Stock is quoted on the NASDAQ System 
(but not on the National Market System thereof) or regularly quoted by a 
recognized securities dealer but selling prices are not reported, the Fair 
Market Value of a Share of Common Stock shall be the mean between the bid and 
asked prices for the Common Stock on the last market trading day prior to the 
day of determination, as reported in the Wall Street Journal or such other 
source as the Administrator deems reliable;

               (iii)     In the absence of an established market for the 
Common Stock, the Fair Market Value thereof shall be determined in good faith 
by the Administrator.


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          (n)  "INCENTIVE STOCK OPTION" means an Option that satisfies the
provisions of Section 422 of the Code.

          (o)  "NONSTATUTORY STOCK OPTION" means an Option that is not an
Incentive Stock Option.

          (p)  "OFFICER" means an officer of the Company within the meaning of
Section 16 of the Exchange Act and the rules and regulations promulgated
thereunder.

          (q)  "OPTION" means a stock option granted pursuant to the Plan.  

          (r)  "OPTIONED STOCK" means the Common Stock subject to an Option.

          (s)  "OPTIONEE" means an Employee or Consultant who holds an Option.

          (t)  "PARENT" corporation shall have the meaning defined in
Section 424(e) of the Code.

          (u)  "PLAN" means this 1991 Stock Option Plan.

          (v)  "SHARE" means a share of the Common Stock, as adjusted in
accordance with Section 10 of the Plan.

          (w)  "SUBSIDIARY" corporation shall have the meaning defined in
Section 424(f) of the Code.

     In addition, the terms "Rule 16b-3" and "Applicable Laws", the term "10%
Shareholder", and the term "Tax Date" shall have the meanings set forth,
respectively, in Sections 4, 7 and 8 below.

     3.   STOCK SUBJECT TO THE PLAN.  Subject to the provisions of Section 10 
of the Plan, the total number of Shares reserved and available for purchase 
upon exercise of Options under the Plan shall be three hundred seventy-six 
thousand one hundred seventy-five (376,175).  The Shares may be authorized, 
but unissued, or reacquired 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 other Options under the Plan.  
However, should the Company reacquire Shares which were issued pursuant to 
the exercise of an Option, such Shares shall not become available for future 
grant under the Plan.


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     4.   ADMINISTRATION OF THE PLAN.

          (a)  COMPOSITION OF ADMINISTRATOR.

                    (i)  ADMINISTRATION WITH RESPECT TO DIRECTORS AND 
OFFICERS. With respect to grants of Options to Employees who are also 
Officers or Directors of the Company, the Plan shall be administered by (A) 
the Board, if the Board may administer the Plan in compliance with the rules 
governing a plan intended to qualify as a discretionary plan under Rule 16b-3 
promulgated under the Exchange Act or any successor rule ("Rule 16b-3"), or 
(B) a Committee designated by the Board to administer the Plan, which 
Committee shall be constituted (I) in such a manner as to comply with the 
rules governing a plan intended to qualify as a discretionary plan under Rule 
16b-3 and (II) in such a manner as to satisfy the legal requirements, if any, 
relating to the administration of incentive stock option plans under 
applicable state corporate and securities laws and under the Code (the 
"Applicable Laws").

                (ii)     ADMINISTRATION WITH RESPECT TO CONSULTANTS AND OTHER 
EMPLOYEES.  With respect to grants of Options to Employees or Consultants who 
are neither Directors nor Officers of the Company, the Plan shall be 
administered by (A) the Board or (B) a Committee designated by the Board, 
which Committee shall be constituted in such a manner as to satisfy the 
Applicable Laws.  

               (iii)     MULTIPLE ADMINISTRATIVE BODIES.  If permitted by 
Rule 16b-3 and by the Applicable Laws, the Plan may (but need not) be 
administered by different administrative bodies with respect to Directors, 
non-Director Officers, and Employees and Consultants who are neither 
Directors nor Officers.

                (iv)     GENERAL.  Once a Committee has been appointed 
pursuant to subsection (i) or (ii) of this Section 4(a), such Committee shall 
continue to serve in its designated capacity until otherwise directed by the 
Board.  From time to time the Board may increase the size of any Committee 
and appoint additional members thereof, remove members (with or without 
cause) and appoint new members in substitution therefor, fill vacancies 
(however caused) or remove all members of the Committee and thereafter 
directly administer the Plan, all to the extent permitted by the Applicable 
Laws, and, in the case of a Committee appointed under subsection (i) hereof, 
to the extent permitted by Rule 16b-3 as it applies to a plan intended to 
qualify thereunder as a discretionary plan.

          (b)  POWERS OF THE ADMINISTRATOR.  Subject to the provisions of the 
Plan and, in the case of a Committee, subject to the specific duties 
delegated by the Board to such Committee, the Administrator shall have the 
authority, in its discretion:


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                 (i)     to determine the Fair Market Value of the Common
Stock, in accordance with Section 2(m) of the Plan;

                (ii)     to select the Officers, Consultants and Employees to
whom Options may from time to time be granted hereunder;

               (iii)     to determine whether and to what extent Options are
granted hereunder;

                (iv)     to determine the number of shares of Common Stock to
be covered by each such Option granted hereunder;

                 (v)     to approve forms of agreement for use under the Plan;

                (vi)     to determine the terms and conditions, not 
inconsistent with the terms of the Plan, of any Option granted hereunder 
(including, but not limited to, whether such Option is an Incentive Stock 
Option or a Nonstatutory Stock Option, the exercise price and any restriction 
or limitation, or any vesting acceleration or waiver of forfeiture 
restrictions regarding any Option or other award and/or the shares of Common 
Stock relating thereto, based in each case on such factors as the 
Administrator shall determine, in its sole discretion); provided, however, 
that in the event of a merger, asset sale or change of control, the 
applicable provisions of Section 10 of the Plan shall govern vesting 
acceleration;

               (vii)     to determine whether and under what circumstances an 
Option may be settled in cash under subsection 7(a)(viii) instead of Common 
Stock;

              (viii)     to reduce the exercise price of any Option to the 
then current Fair Market Value if the Fair Market Value of the Common Stock 
covered by such Option shall have declined since the date the Option was 
granted; 

                (ix)     to interpret the Plan;

                 (x)     to prescribe, amend and rescind rules and regulations
relating to the Plan;

                (xi)     with the consent of the holder thereof, to modify or
amend each Option; and

               (xii)     to make all other determinations deemed necessary or
advisable for the administration of the Plan.


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          (c)  EFFECT OF ADMINISTRATOR'S DECISION.  All decisions,
determinations and interpretations of the Administrator shall be final and
binding on all Optionees.

     5.   ELIGIBILITY.

          (a)  PERSONS ELIGIBLE.  Nonstatutory Stock Options may be granted 
only to Employees and Consultants.  Incentive Stock Options may be granted 
only to Employees.  An Optionee who has been granted an Option may, if he or 
she is otherwise eligible, be granted additional Options.  

          (b)  NO EMPLOYMENT AGREEMENT.  Neither the Plan nor any Option 
agreement shall confer upon any Optionee any right with respect to 
continuation of employment by or service as a Consultant to the Company, nor 
shall it interfere in any way with the Optionee's right or the Company's 
right to terminate the Optionee's employment or consulting relationship at 
any time.

     6.   TERM OF PLAN.  Subject to Section 15 of the Plan, the Plan shall 
become effective upon the earlier to occur of its adoption by the Board or 
its approval by the shareholders of the Company as described in Section 15.  
It shall continue in effect for a term of ten (10) years unless sooner 
terminated under Section 12 of the Plan.

     7.   OPTIONS.

          (a)  GRANTS.  The Administrator, in its discretion, may grant 
Options to eligible participants and shall determine whether such Options 
shall be Incentive Stock Options or Nonstatutory Stock Options.  Each Option 
shall be evidenced by a written Option agreement which shall expressly 
identify the Options as Incentive Stock Options or as Nonstatutory Stock 
Options, and be in such form and contain such provisions as the Administrator 
shall from time to time deem appropriate.  Without limiting the foregoing, 
the Administrator may, at any time, or from time to time, authorize the 
Company, with the consent of the respective recipients, to issue Options in 
exchange for the surrender and cancellation of any or all outstanding 
Options.  Option agreements shall contain the following terms and conditions:

                 (i)     EXERCISE PRICE; NUMBER OF SHARES.  The per Share 
exercise price for the Shares issuable upon exercise of an Option shall be 
such price as is determined by the Administrator, but shall in no event be 
less than 100% of the Fair Market Value of Common Stock, determined as of the 
date of grant of the Option.  In the event that the Administrator shall 
subsequently amend the Option to reduce the exercise price, the exercise 
price shall be no less than 100% of the Fair Market Value as of the date of 
that amendment.

     The Option agreement shall specify the number of Shares to which it
pertains.


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                (ii)     WAITING PERIOD; EXERCISABILITY; TERM.  At the time 
an Option is granted, the Administrator will determine the terms and 
conditions to be satisfied before Shares may be purchased, including the 
dates on which Shares subject to the Option may first be purchased or the 
conditions which must be satisfied prior to purchase.  The Administrator may 
specify that an Option may not be exercised until the completion of the 
service period specified at the time of grant.  (Any such period is referred 
to herein as the "waiting period".) At the time an Option is granted, the 
Administrator shall fix the period within which the Option may be exercised, 
which shall not be less than the waiting period, if any, nor more than ten 
(10) years from the date of grant.

               (iii)     FORM OF PAYMENT.  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 Administrator (and, in the case of an 
Incentive Stock Option, shall be determined at the time of grant) and may 
consist entirely of (1) cash, (2) check, (3) promissory note, (4) 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 surrender equal to 
the aggregate exercise price of the Shares as to which said Option shall be 
exercised, (5) 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, (6) any 
combination of the foregoing methods of payment, or (7) such other 
consideration and method of payment for the issuance of Shares to the extent 
permitted under Applicable Laws.

                (iv)     SPECIAL INCENTIVE STOCK OPTION PROVISIONS.  In 
addition to the foregoing, Options granted under the Plan which are intended 
to be Incentive Stock Options under Section 422 of the Code shall be subject 
to the following terms and conditions:

                         (A)  DOLLAR LIMITATION.  To the extent that the 
aggregate Fair Market Value of (i) the Shares with respect to which Options 
designated as Incentive Stock Options plus (ii) the shares of stock of the 
Company, Parent and any Subsidiary with respect to which other incentive 
stock options are exercisable for the first time by an Optionee during any 
calendar year under all plans of the Company and any Parent and Subsidiary 
exceeds $100,000, such Options shall be treated as Nonstatutory Stock 
Options.  For purposes of the preceding sentence, (i) Options shall be taken 
into account in the order in which they were granted, and (ii) the Fair 
Market Value of the Shares shall be determined as of the time the Option or 
other incentive stock option is granted.

                         (B)  GENERAL.  Except as modified by the preceding 
provisions of this subsection 7(a)(iv) and except as otherwise limited by 
Section 422 of the Code, all of the provisions of the Plan shall be 
applicable to the Incentive Stock Options granted hereunder.


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                 (v)     10% SHAREHOLDER.  If any Optionee to whom an Incentive
Stock Option is to be granted pursuant to the provisions of the Plan is, on the
date of grant, the owner of Common Stock (as determined under Section 424(d) of
the Code) possessing more than 10% of the total combined voting power of all
classes of stock of the Company or any Subsidiary (a "10% Shareholder"), then
the following special provisions shall be applicable to the Option granted to
such individual:

                         (A)  The per Share Option price of Shares subject to 
such Incentive Stock Option shall not be less than 110% of the Fair Market 
Value of Common Stock on the date of grant; and

                         (B)  The Option shall not have a term in excess of 
five (5) years from the date of grant.

                (vi)     RULE 16b-3.  Grants of options to Directors, 
Officers and 10% Shareholders must comply with the applicable provisions of 
Rule 16b-3 and such Options shall contain such additional conditions or 
restrictions, if any, as may be required by Rule 16b-3 to be in the written 
Option Agreement in order to qualify for the maximum exemption from Section 
16 of the Exchange Act with respect to Plan transactions.

               (vii)     OTHER PROVISIONS.  Each Option granted under the 
Plan may contain such other terms, provisions, and conditions not 
inconsistent with the Plan as may be determined by the Administrator.

              (viii)     BUYOUT PROVISIONS.  The Administrator may at any 
time offer to buy out, for a payment in cash or Shares, an Option previously 
granted, based on such terms and conditions as the Administrator shall 
establish and communicate to the Optionee at the time that such offer is 
made.  Any such cash offer made to an Officer or Director shall comply with 
the provisions of Rule 16b-3 relating to cash settlement of stock 
appreciation rights.  This provision is intended only to clarify the powers 
of the Administrator and shall not in any way be deemed to create any rights 
on the part of Optionees to receive buyout offers or payments.

          (b)  METHOD OF EXERCISE.

                 (i)     EXERCISABILITY.  Any Option granted hereunder shall 
be exercisable at such times and under such conditions as determined by the 
Administrator and as shall be permissible under the terms of the Plan.

                (ii)     NO FRACTIONAL SHARES.  An Option may not be 
exercised for a fraction of a Share.


                                     -8-
<PAGE>

               (iii)     PROCEDURE FOR EXERCISE; RIGHTS AS A SHAREHOLDER.  An 
Option shall be deemed to be exercised when the Company receives:  (i) 
written notice of such exercise in accordance with the terms of the Option 
from the person entitled to exercise the Option and (ii) full payment for the 
Shares with respect to which the Option is exercised.  Full payment may 
consist of any consideration and method of payment allowable under subsection 
7(a)(iii) of the Plan, as authorized by the Administrator (and, in the case 
of an Incentive Stock Option, determined at the time of grant) and permitted 
by the Option Agreement. Shares issued upon exercise of an Option shall be 
issued in the name of the Optionee or, if requested by the Optionee, in the 
name of the Optionee and his or her spouse.  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.  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.

                (iv)     EFFECT OF EXERCISE.  Exercise of an Option in any 
manner shall result in a decrease in the number of Shares which thereafter 
shall 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.

          (c)  EFFECT OF TERMINATION OF EMPLOYEE OR CONSULTANT STATUS.

                 (i)     TERMINATION OF EMPLOYMENT OR CONSULTING 
RELATIONSHIP. In the event an Optionee's Continuous Status as an Employee or 
Consultant terminates (other than upon the Optionee's death or Disability), 
the Optionee may exercise his or her Option, but only within such period of 
time not to exceed six months as is determined by the Administrator (with 
such determination being made at the time of grant and not exceeding three 
(3) months in the case of an Incentive Stock Option) from the date of such 
termination, and only to the extent that the Optionee was entitled to 
exercise it at the date of such termination (but in no event later than the 
expiration of the term of such Option as set forth in the Option Agreement).  
If, at the date of termination, the Optionee is not entitled to exercise his 
or her entire Option, the Shares covered by the unexercisable portion of the 
Option shall be returned to the Plan as of the termination date.  If, after 
termination, the Optionee does not exercise his or her Option within the time 
specified herein, the Option shall terminate, and all remaining Shares 
covered by such Option shall be returned to the Plan at the end of such 
period.

                (ii)     DISABILITY OF OPTIONEE.  In the event an Optionee's 
Continuous Status as an Employee or Consultant terminates as a result of the 
Optionee's Disability, the Optionee may exercise his or her Option, but only 
within six months from the date of such termination, and only to the extent 
that the Optionee was entitled to exercise it at the date of such termination 
(but in no event later than the expiration of the term of such Option as set 
forth in the Option Agreement).  If, at the date of termination due to 
Disability, the Optionee is not entitled to 


                                      -9-
<PAGE>

exercise his or her entire Option, the Shares covered by the unexercisable 
portion of the Option shall be returned to the Plan as of the date of 
Disability.  If, after such termination, the Optionee does not exercise his 
or her Option within the time specified herein, the Option shall terminate, 
and all remaining Shares covered by such Option shall be returned to the Plan 
at the end of such period.

               (iii)     DEATH OF OPTIONEE.  In the event of an Optionee's 
death, the Optionee's estate or a person who acquired the right to exercise 
the deceased Optionee's Option by bequest or inheritance may exercise the 
Option, but only within six months following the date of death, and only to 
the extent that the Optionee was entitled to exercise it at the date of death 
(but in no event later than the expiration of the term of such Option as set 
forth in the Option Agreement).  If, at the time of death, the Optionee was 
not entitled to exercise his or her entire Option, the Shares covered by the 
unexercisable portion of the Option shall be returned to the Plan as of the 
date of death. If, after death, the Optionee's estate or a person who 
acquired the right to exercise the Option by bequest or inheritance does not 
exercise the Option within the time specified herein, the Option shall 
terminate, and all remaining Shares covered by such Option shall be returned 
to the Plan at the end of such period.

     8.   STOCK WITHHOLDING TO SATISFY WITHHOLDING TAX OBLIGATIONS.

          (a)  ABILITY TO USE STOCK FOR WITHHOLDING.  At the discretion of 
the Administrator, Optionees may satisfy withholding obligations as provided 
in this Section 8.  When an Optionee incurs tax liability in connection with 
the exercise of an Option, which tax liability is subject to tax withholding 
under applicable tax laws, and the Optionee is obligated to pay the Company 
an amount required to be withheld under applicable tax laws, the Optionee may 
satisfy the withholding tax obligation by electing to have the Company 
withhold from the Shares to be issued upon exercise of the Option that number 
of Shares having a Fair Market Value equal to the amount required to be 
withheld.  The Fair Market Value of the Shares to be withheld shall be 
determined on the date that the amount of tax to be withheld is to be 
determined (the "Tax Date").

          (b)  ELECTION TO HAVE STOCK WITHHELD.  All elections by an Optionee 
to have Shares withheld for this purpose shall be made in writing in a form 
acceptable to the Administrator and shall be subject to the following 
restrictions:

                 (i)     the election must be made on or prior to the
applicable Tax Date;

                (ii)     once made, the election shall be irrevocable as to 
the particular Shares of the Option as to which the election is made (unless 
otherwise permitted by applicable tax regulations under the Code);


                                     -10-
<PAGE>

               (iii)     all elections shall be subject to the consent or
disapproval of the Administrator; and

                (iv)     if the Optionee is a Director, Officer or 10% 
Shareholder, the election must comply with the applicable provisions of Rule 
16b-3 and shall be subject to such additional conditions or restrictions as 
may be required thereunder to qualify for the maximum exemption from Section 
16 of the Exchange Act with respect to Plan transactions.

          (c)  SECTION 83(b) ELECTION.  In the event the election to have 
Shares withheld is made by an Optionee, no election is filed under Section 
83(b) of the Code and the Tax Date is deferred under Section 83 of the Code, 
the Optionee shall receive the full number of Shares with respect to which 
the Option is exercised but such Optionee shall be unconditionally obligated 
to tender back to the Company the proper number of Shares on the Tax Date.

     9.   NON-TRANSFERABILITY OF OPTIONS.  Options may not be sold, pledged, 
assigned, hypothecated, transferred or disposed of in any manner other than 
by will or by the laws of descent and distribution or pursuant to a qualified 
domestic relations order as defined by the Code or Title I of the Employee 
Retirement Income Security Act, or the rules thereunder.  The designation of 
a beneficiary by an Optionee does not constitute a transfer.  An Option may 
be exercised, during the lifetime of the Optionee, only by the Optionee or a 
transferee permitted by this Section 9.

     10.  ADJUSTMENTS UPON CHANGES IN CAPITALIZATION, DISSOLUTION, MERGER,
          ASSET SALE OR CHANGE OF CONTROL.

          (a)  CHANGES IN CAPITALIZATION.  Subject to any required action by 
the shareholders of the Company, the number of Shares covered by each 
outstanding Option, and the number of Shares which have been authorized for 
issuance under the Plan but as to which no Options have yet been granted or 
which have been returned to the Plan upon cancellation or expiration of an 
Option, as well as the price per Share covered by each such outstanding 
Option, shall be proportionately adjusted for any increase or decrease in the 
number of issued Shares resulting from a stock split, reverse stock split, 
stock dividend, combination or reclassification of the Common Stock, or any 
other increase or decrease in the aggregate number of issued Shares effected 
without receipt of consideration by the Company; provided, however, that 
conversion of any convertible securities of the Company shall not be deemed 
for this purpose to have been "effected without receipt of consideration".  
Such adjustment shall be made by the Administrator, whose determination in 
that respect shall be final, binding and conclusive.

          (b)  DISSOLUTION OR LIQUIDATION.  In the event of the proposed 
dissolution or liquidation of the Company, all outstanding Options will 
terminate immediately prior to the consummation of such proposed action.  The 
Administrator may, in the exercise of its sole discre-


                                     -11-
<PAGE>

tion in such instances, declare that all Options shall terminate as of a date 
fixed by the Administrator and give each Optionee the right to exercise his 
or her Option as to all or any part of the Optioned Stock, including Shares 
as to which the Option would not otherwise be exercisable.

          (c)  MERGER OR ASSET SALE.  In the event of a merger of the Company 
with or into another corporation or the sale of substantially all of the 
assets of the Company, each outstanding Option shall be assumed or an 
equivalent option substituted by the successor corporation or a Parent or 
Subsidiary of such successor corporation.  However, the Administrator may, in 
lieu of such assumption or substitution, provide each Optionee with the right 
to exercise his or her Options in full as to all of the Optioned Stock, 
including Shares as to which such Options would not otherwise be exercisable. 
If the Administrator makes an Option fully exercisable in lieu of assumption 
or substitution in the event of a merger or sale of assets, the Administrator 
shall notify the Optionee that the Option shall be fully exercisable for a 
period of time determined by the Administrator from the date of such notice, 
and the Option will terminate upon the expiration of such period.  For the 
purposes of this paragraph, the Option shall be considered assumed if, 
immediately following the merger or sale of assets, the option confers the 
right to purchase, for each Share of Optioned Stock subject to the Option 
immediately prior to the merger or sale of assets, the consideration (whether 
stock, cash, or other securities or property) received in the merger or sale 
of assets by holders of Common Stock for each Share held on the effective 
date of the transaction (and, if such holders were offered a choice of 
consideration, the type of consideration chosen by the holders of a majority 
of the outstanding Shares); provided, however, that if such consideration 
received in the merger or sale of assets was not solely common stock of the 
successor corporation or its Parent, the Administrator may, with the consent 
of the successor corporation and the participant, provide for the 
consideration to be received upon the exercise of the Option for each Share 
of Optioned Stock subject to the Option to be solely common stock of the 
successor corporation or its Parent equal in Fair Market Value to the per 
share consideration received by holders of Common Stock in the merger or sale 
of assets.

          (d)  CHANGE IN CONTROL.  In the event of a "Change in Control" of 
the Company, as defined in paragraph (e) below, unless otherwise determined 
by the Administrator prior to the occurrence of such Change in Control, any 
Options outstanding on the date such Change in Control is determined to have 
occurred that are not yet exercisable and vested on such date, whether such 
Options were granted before or after the amendment of the Plan to include 
this provision, shall become fully exercisable and vested.

          (e)  DEFINITION OF "CHANGE IN CONTROL".  For purposes of this 
Section 10, a "Change in Control" means the happening of any of the following:

               (i)  When any "person", as such term is used in Sections 13(d) 
and 14(d) of the Exchange Act (other than the Company, a Subsidiary or a 
Company employee benefit plan, 


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<PAGE>

including any trustee of such plan acting as trustee) is or becomes the 
"beneficial owner" (as defined in Rule 13d-3 promulgated under the Exchange 
Act), directly or indirectly, of securities of the Company representing fifty 
percent (50%) or more of the combined voting power of the Company's then 
outstanding securities; or

              (ii)  The shareholders of the Company approve a merger or 
consolidation of the Company with any other corporation, other than a merger 
or consolidation which would result in the voting securities of the Company 
outstanding immediately prior thereto continuing to represent (either by 
remaining outstanding or by being converted into voting securities of the 
surviving entity) at least fifty percent (50%) of the total voting power 
represented by the voting securities of the Company or such surviving entity 
outstanding immediately after such merger or consolidation, or the 
shareholders of the Company approve an agreement for the sale or disposition 
by the Company of all or substantially all of the Company's assets; or

             (iii)  A change in the composition of the Board as a result of 
which fewer than a majority of the directors in office are Incumbent 
Directors. "Incumbent Directors" shall mean directors who either (A) are 
directors of the Company as of the date this Section 10(e) was added to the 
Plan by the Board, or (B) are elected, or nominated for election, to the 
Board with the affirmative votes of at least a majority of the Incumbent 
Directors at the time of such election or nomination (but shall not include 
an individual whose election or nomination is in connection with an actual or 
threatened proxy contest relating to the election of directors to the 
Company).

          (f)  NO OTHER ADJUSTMENTS.  Except as expressly provided or 
authorized herein, no issuance by the Company of shares of stock of any 
class, or securities convertible into or exercisable for shares of stock of 
any class, shall affect, and no adjustment by reason thereof shall be made 
with respect to, the number or price of Shares subject to an Option.

     11.  TIME OF GRANTING OPTIONS.  The date of grant of an Option shall, 
for all purposes, be the date on which the Administrator makes the 
determination granting such Option, or such other later date as is determined 
by the Administrator.  Notice of the determination shall be given to each 
Employee or Consultant 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 terminate the Plan.  The Company shall obtain shareholder 
approval of any Plan amendment to the extent necessary and desirable to 
comply with Rule 16b-3 promulgated under the Exchange Act or Section 422 of 
the Code (or any other applicable law or regulation, including the 
requirements of any exchange or quotation system on which the Common Stock is 
listed or quoted) in such a manner and to such a degree as is required by 
such law or regulation.


                                     -13-
<PAGE>

          (b)  EFFECT OF AMENDMENT OR TERMINATION.  No amendment, alteration, 
suspension or termination of the Plan shall impair the rights of any Optionee 
with respect to Options already granted unless mutually agreed otherwise 
between the Optionee and the Administrator, which agreement must be in a 
writing signed by the Optionee and the Company.

     13.  CONDITIONS UPON ISSUANCE OF SHARES.

          (a)  COMPLIANCE WITH LAWS.  Shares shall not be issued upon 
exercise of an Option unless such exercise 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 or quotation 
system upon which the Shares may then be listed or quoted, and shall be 
further subject to the approval of counsel for the Company with respect to 
such compliance.

          (b)  INVESTMENT INTENT.  As a condition to the exercise of an 
Option or the issuance of Shares upon 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.

          (c)  NO COMPANY LIABILITY.  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 non-issuance or sale of such Shares as to which such requisite 
authority shall not have been obtained.

          (d)  GRANTS EXCEEDING ALLOTTED SHARES.  If the Optioned Stock 
covered by an Option exceeds, as of the date of grant, the number of Shares 
which may be issued under the Plan without additional shareholder approval, 
such Option shall be void, and shall not be exercisable, with respect to such 
excess Optioned Stock, unless shareholder approval of an amendment 
sufficiently increasing the number of Shares subject to the Plan to permit 
full exercise of the Option is timely obtained in accordance with Sections 12 
and 15 of the Plan.

     14.  RESERVATION OF SHARES.  The Company, during the term of this Plan, 
will at all times reserve and keep available such number of Shares as shall 
be sufficient to satisfy the requirements of the Plan and the Options granted 
hereunder.


                                      -14-
<PAGE>

     15.  SHAREHOLDER APPROVAL.

          (a)  REQUIREMENT.  Continuance of the Plan shall be subject to 
approval by the shareholders of the Company within twelve (12) months before 
or after the date the Plan is adopted as provided in Section 6 and at or 
prior to the first annual meeting of shareholders held subsequent to the 
first granting of an Option hereunder.  Such shareholder approval shall be 
obtained in the manner and to the degree that is required under applicable 
federal and state laws.

          (b)  MANNER OF SOLICITATION.  Approval of the Plan by the 
shareholders of the Company shall be solicited substantially in accordance 
with Section 14(a) of the Exchange Act and the rules and regulations 
promulgated thereunder.


     16.  PERFORMANCE-BASED PLAN LIMITATION.  The following limitations shall 
apply to grants of Options to Employees:

          (i)       No Employee shall be granted, in any fiscal year of the 
Company, Options to purchase more than 50,000 Shares.

          (ii)      In connection with his or her initial employment, an 
Employee may be granted Options to purchase up to an additional 50,000 
Shares, which shall not count against the limit set forth in subsection (i) 
above.

          (iii)     The foregoing limitations shall be adjusted 
proportionately in connection with any change in the Company's capitalization 
as described in Section 10.

          (iv)      If an Option is cancelled in the same fiscal year of the 
Company in which it was granted (other than in connection with a transaction 
described in Section 10), the cancelled Option will be counted against the 
limit set forth in this Section 16.  For this purpose, if the exercise price 
of an Option is reduced, the transaction will be treated as a cancellation of 
the Option and the grant of a new Option.


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