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                                                                  EXHIBIT 10(J)
 
                              MINNTECH CORPORATION
                             1998 STOCK OPTION PLAN
 
    1.  PURPOSE.  The purpose of this 1998 Stock Option Plan (the "Plan") is to
promote the interests of Minntech Corporation, a Minnesota corporation (the
"Company"), and its shareholders by providing personnel of the Company and any
subsidiaries thereof with an opportunity to acquire a proprietary interest in
the Company and thereby develop a stronger incentive to put forth maximum effort
for the continued success and growth of the Company. In addition, the
opportunity to acquire a proprietary interest in the Company will aid in
attracting and retaining personnel of outstanding ability.
 
    2.  ADMINISTRATION.
 
        (a)  GENERAL.  This Plan shall be administered by a committee of two or
    more directors of the Company (the "Committee") appointed by the Company's
    Board of Directors (the "Board"). If the Board has not appointed a committee
    to administer this Plan, then the Board shall constitute the Committee. The
    Committee shall have the power, subject to the limitations contained in this
    Plan, to fix any terms and conditions for the grant or exercise of any
    option under this Plan. No director shall serve as a member of the Committee
    unless such director shall be (i) a "non-employee director" as that term is
    defined in Rule 16b-3 promulgated under the Securities Exchange Act of 1934,
    as amended (the "Exchange Act"), or any successor statute or regulation
    comprehending the same subject matter and (ii) an "outside director" under
    Section 162(m) of the Internal Revenue code of 1986, as amended (the
    "Code"), and the regulations issued thereunder. A majority of the members of
    the Committee shall constitute a quorum for any meeting of the Committee,
    and the acts of a majority of the members present at any meeting at which a
    quorum is present or the acts unanimously approved in writing by all members
    of the Committee shall be the acts of the Committee. Subject to the
    provisions of this Plan, the Committee may from time to time adopt such
    rules for the administration of this Plan as it deems appropriate. The
    decision of the Committee on any matter affecting this Plan or the rights
    and obligations arising under this Plan or any option granted hereunder,
    shall be final, conclusive and binding upon all persons, including without
    limitation the Company, shareholders and optionees.
 
        (b)  INDEMNIFICATION.  To the full extent permitted by law, (i) no
    member of the Committee or person to whom authority under this Plan is
    delegated shall be liable for any action or determination taken or made in
    good faith with respect to this Plan or any option granted hereunder and
    (ii) the members of the Committee and each person to whom authority under
    this Plan is delegated shall be entitled to indemnification by the Company
    against and from any loss incurred by such member or person by reason of any
    such actions and determinations.
 
        (c)  DELEGATION OF AUTHORITY.  The Committee may delegate all or any
    part of its authority under this Plan to the Chief Executive Officer of the
    Company for purposes of granting and administering options granted to
    persons other than persons who are then subject to the reporting
    requirements of Section 16 of the Exchange Act ("Section 16 Individuals").
    The Chief Executive Officer of the Company may, in turn, delegate such
    authority to such other officer of the Company as the Chief Executive
    Officer may determine.
 
        (d)  ACTION BY BOARD.  Notwithstanding paragraph 2(a), above, any grant
    of options hereunder to any director of the Company who is not an employee
    of the Company, and any action taken by the Company with respect to any such
    option, including any amendment thereto, and any acceleration of the vesting
    of any option granted to or held by a director who is not an employee of the
    Company, any extension of the time within which any such option may be
    exercised, any determination pursuant to paragraph 9 relating to the payment
    of the purchase price of Shares (as defined in paragraph 3 below) subject to
    any such option, or any action pursuant to paragraph 10 relating to the
    payment of withholding taxes, if any, through the use of Shares with respect
    to any such option shall be subject to prior approval by the Board.
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    3.  SHARES.  The shares that may be made subject to options granted under
this Plan shall be authorized and unissued shares of Common Stock of the
Company, par value $.05 per share ("Shares," and each individually a "Share"),
and they shall not exceed 1,000,000 Shares in the aggregate, subject to
adjustment as provided in paragraph 15, below, except that, if any option lapses
or terminates for any reason before such option has been completely exercised,
the Shares covered by the unexercised portion of such option may again be made
subject to options granted under this Plan.
 
    4.  ELIGIBLE PARTICIPANTS.  Stock options may be granted under this Plan to
any part-time or full-time employee of the Company, or any parent or subsidiary
thereof, including any such person who is also an officer or director of the
Company or any parent or subsidiary thereof. Non-statutory stock options (as
defined in paragraph 5(a) below) also may be granted to (i) any director of the
Company who is not an employee of the Company or any parent or subsidiary
thereof, (ii) other individuals or entities who are not employees but who
provide services to the Company or a parent or subsidiary thereof in the
capacity of an advisor or consultant, and (iii) any individual or entity that
the Company desires to induce to become an employee, advisor or consultant, but
any such grant shall be contingent upon such individual or entity becoming
employed by the Company or a parent or subsidiary thereof. References herein to
"employment" and similar terms (except "employee") shall include the providing
of services in the capacity of an advisor or consultant or as a director. The
employees and other individuals and entities to whom options may be granted
pursuant to this paragraph 4 are referred to herein as "Eligible Participants."
 
    5.  TERMS AND CONDITIONS OF OPTIONS.
 
        (a)  GENERAL.  Subject to the terms and conditions of this Plan, the
    Committee may, from time to time during the term of this Plan, grant to such
    Eligible Participants as the Committee may determine options to purchase
    such number of Shares of the Company on such terms and conditions as the
    Committee may determine. In determining the Eligible Participants to whom
    options shall be granted and the number of Shares to be covered by each
    option, the Committee may take into account the nature of the services
    rendered by the respective Eligible Participants, their present and
    potential contributions to the success of the Company, and such other
    factors as the Committee in its sole discretion may deem relevant. The date
    and time of approval by the Committee of the granting of an option shall be
    considered the date and the time of the grant of such option. The Committee
    in its sole discretion may designate whether an option granted to an
    employee is to be considered an "incentive stock option" (as that term is
    defined in Section 422 of the Code, or any amendment thereto) or a
    non-statutory stock option (an option granted under this Plan that is not
    intended to be an "incentive stock option"). The Committee may grant both
    incentive stock options and non-statutory stock options to the same
    employee. However, if an incentive stock option and a non-statutory stock
    option are awarded simultaneously, such options shall be deemed to have been
    awarded in separate grants, shall be clearly identified, and in no event
    shall the exercise of one such option affect the right to exercise the
    other. To the extent that the aggregate Fair Market Value (as defined in
    paragraph 8 below) of Shares with respect to which incentive stock options
    are exercisable for the first time by any employee during any calendar year
    (under all plans of the Company and its parent and subsidiary corporations)
    exceeds $100,000, such options shall be treated as non-statutory stock
    options. The maximum number of Shares subject to options that may be granted
    to any one Eligible Participant under the Plan in any fiscal year of the
    Company may not exceed 200,000 Shares (subject to adjustment pursuant to
    paragraph 15 hereof).
 
        (b)  PURCHASE PRICE.  The purchase price of each Share subject to an
    option granted pursuant to this paragraph 5 shall be not less than 100% of
    the Fair Market Value of a Share on the date of grant; provided that if an
    incentive stock option is granted to an employee who owns, or is deemed
    under Section 424(d) of the Code to own, at the time such option is granted,
    stock of the Company (or of any parent or subsidiary of the Company)
    possessing more than 10% of the total combined voting
 
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    power of all classes of stock therein (a "10% Shareholder"), such purchase
    price shall be no less than 110% of the Fair Market Value of a Share on the
    date of grant.
 
        (c)  VESTING.  Each option agreement provided for in paragraph 7 shall
    specify when each option granted under this Plan shall become exercisable
    with respect to the Shares covered by the option. Notwithstanding the
    provisions of any option agreement provided for in paragraph 7, the
    Committee may at any time, in its sole discretion, declare that any option
    granted under this Plan shall be immediately exercisable in whole or in
    part.
 
        (d)  TERMINATION.  Each option granted pursuant to this paragraph 5
    shall expire, and all rights to purchase Shares thereunder shall terminate,
    on the earliest of:
 
           (i) ten years after the date such option is granted (or in the case
       of an incentive stock option granted to a 10% Shareholder, five years
       after the date such option is granted) or on such date prior thereto as
       may be fixed by the Committee on or before the date such option is
       granted;
 
           (ii) the expiration of the period after the termination of the
       optionee's employment within which the option is exercisable as specified
       in paragraph 12(b) (provided that the Committee may, in any option
       agreement provided for in paragraph 7 or by Committee action with respect
       to any outstanding option, extend the periods specified in paragraph
       12(b)); or
 
           (iii) the date, if any, fixed for cancellation pursuant to paragraph
       13(c) or 14 below.
 
    6.  AUTOMATIC GRANTS TO NON-EMPLOYEE DIRECTORS.  Each director of the
Company who is not and has never been an employee of the Company and who (i) is
serving an unexpired term as a director of the Company as of the date of the
last regularly scheduled meeting of the Board during any fiscal year of the
Company and (ii) at the time of such meeting has served as a director for at
least six months of the twelve month period preceding the date of such meeting,
shall as of the date of such meeting automatically be granted an option to
purchase 7,030 Shares at an option price per share equal to 100% of the Fair
Market Value of a Share on such date. All such options shall be non-statutory
stock options and shall be subject to the same terms and conditions as are then
in effect with respect to non-statutory stock options granted to officers and
employees of the Company, except that (x) the term of each such option shall be
ten years, (y) each such option shall remain in effect for its full ten year
term and shall not terminate or expire following the death, disability or
retirement of the non-employee director and (z) each such option shall become
exercisable as to all or any part of the Shares subject thereto six months after
the date the option is granted. Subject to the foregoing, all provisions of this
Plan not inconsistent with the foregoing shall apply to options granted to
non-employee directors pursuant to this paragraph 6. The maximum number of
Shares as to which options may be granted to any non-employee director under
this paragraph 6 shall be 140,600 Shares.
 
    7.  OPTION AGREEMENTS.  All options granted under this Plan shall be
evidenced by a written agreement in such form or forms as the Committee may from
time to time determine, which agreement shall, among other things, designate
whether the options being granted thereunder are non-statutory stock options or
incentive stock options.
 
    8.  FAIR MARKET VALUE.  For purposes of this Plan, the "Fair Market Value"
of a Share at a specified date shall, unless otherwise expressly provided in
this Plan, mean the closing sale price of a Share on the date immediately
preceding such date or, if no sale of Shares shall have occurred on that date,
on the next preceding day on which a sale of Shares occurred, on the Composite
Tape for New York Stock Exchange listed shares or, if Shares are not quoted on
the Composite Tape for New York Stock Exchange listed shares, on the Nasdaq
National Market or any similar system then in use or, if Shares are not included
in the Nasdaq National Market or any similar system then in use, the mean
between the closing "bid" and the closing "asked" quotation of a Share on the
date immediately preceding the date as of which such Fair Market Value is being
determined, or, if no closing bid or asked quotation is made on that date, on
the next preceding day on which a quotation is made, on the Nasdaq SmallCap
Market or any similar system
 
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then in use, provided that if the Shares in question are not quoted on any such
system, Fair Market Value shall be what the Committee determines in good faith
to be 100% of the fair market value of a Share as of the date in question.
Notwithstanding anything stated in this paragraph 8, if the applicable
securities exchange or system has closed for the day by the time the
determination is being made, all references in this paragraph to the date
immediately preceding the date in question shall be deemed to be references to
the date in question.
 
    9.  MANNER OF EXERCISE OF OPTIONS.  A person entitled to exercise an option
granted under this Plan may, subject to its terms and conditions and the terms
and conditions of this Plan, exercise it in whole at any time, or in part from
time to time, by delivery to the Company at its principal executive office of
written notice of exercise, specifying the number of Shares with respect to
which the option is being exercised. The purchase price of the Shares with
respect to which an option is being exercised shall be payable in full at the
time of exercise, provided that, to the extent permitted by law, the holder of
an option may simultaneously exercise an option and sell all or a portion of the
Shares thereby acquired pursuant to a brokerage or similar relationship and use
the proceeds from such sale to pay the purchase price of such Shares. The
purchase price of each Share on the exercise of any option shall be paid in full
in cash (including check, bank draft or money order) or, at the discretion of
the person exercising the option, by tender or delivery to the Company of
unencumbered Shares having an aggregate Fair Market Value on the date of
exercise equal to the amount of the purchase price being paid through such
tender or delivery of Shares, or by a combination of cash and such Shares;
provided, however, that no person shall be permitted to pay any portion of the
purchase price with Shares if the Committee, in its sole discretion, determines
that payment in such manner is undesirable. The granting of an option to a
person shall give such person no rights as a shareholder except as to Shares
issued to such person.
 
    10.  TAX WITHHOLDING.  Delivery of Shares pursuant to a stock award or upon
exercise of any non-statutory stock option granted under this Plan shall be
subject to any required withholding taxes. A person receiving a stock award or
exercising a non-statutory stock option may, as a condition precedent to
receiving the Shares, be required to pay the Company a cash amount equal to the
amount of any required withholdings. In lieu of all or any part of such a cash
payment, the Committee may, but shall not be required to, provide in any option
agreement provided for in paragraph 7 (or provide by Committee action with
respect to any outstanding option) that a person exercising an option may cover
all or any part of the required withholdings, and any additional withholdings up
to the amount needed to cover the individual's full FICA and federal, state and
local income tax liability with respect to income arising from the exercise of
the option, through the tender or delivery to the Company of unencumbered Shares
having an aggregate Fair Market Value on the date of exercise equal to the
amount of the withholding taxes being paid through such delivery, reduction or
subsequent return of Share.
 
    11.  RELOAD OPTIONS.  If the Committee so determines, the Agreement relating
to any option may provide for the issuance of "reload" options pursuant to
which, subject to the terms and conditions established by the Committee and any
requirements of applicable law, the person exercising the option will, either
automatically (to the extent Shares remain available under this Plan) or subject
to subsequent Committee approval, be granted a new option when the payment of
the exercise price of the original option and/or the payment of tax withholding
pursuant to paragraph 10 hereof is made through the tender or delivery of Shares
to the Company. Each such reload option shall (i) be a non-statutory option to
purchase the number of Shares provided as consideration for the exercise price
of and in payment of taxes in connection with the exercise of the original
option, (ii) have a per share exercise price equal to the Fair Market Value as
of the date of exercise of the original option, (iii) be immediately exercisable
and have a term of ten years from the date of the original option (that is, such
reload option will terminate on the date the original option terminates or would
have terminated) and (iv) otherwise have the same terms and conditions as the
original option, except that the reload option will not be an incentive stock
option and will not provide for an automatic grant of additional reload options
upon its exercise.
 
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    12.  TRANSFERABILITY AND TERMINATION OF EMPLOYMENT.
 
        (a)  TRANSFERABILITY.  During the lifetime of an optionee, only such
    optionee or his or her guardian or legal representative may exercise options
    granted under this Plan, and no option granted under this Plan shall be
    assignable or transferable by the optionee otherwise than by will or the
    laws of descent and distribution or pursuant to a domestic relations order
    as defined by the Code or Title I of the Employee Retirement Income Security
    Act, or the rules thereunder; provided, however, that any optionee may
    transfer a non-statutory stock option granted under this Plan to a member or
    members of his or her immediate family (i.e., his or her children,
    grandchildren and spouse) or to one or more trusts for the benefit of such
    family members or partnerships in which such family members are the only
    partners, if (i) the option agreement with respect to such option expressly
    so provides either at the time of initial grant or by amendment to an
    outstanding option agreement and (ii) the optionee does not receive any
    consideration for the transfer. Any options held by any such transferee
    shall continue to be subject to the same terms and conditions that were
    applicable to such options immediately prior to their transfer and may be
    exercised by such transferee as and to the extent that such option has
    become exercisable and has not terminated in accordance with the provisions
    of the Plan and the applicable option agreement. For purposes of any
    provision of this Plan relating to notice to an optionee or to vesting or
    termination of an option upon the death, disability or termination of
    employment of an optionee, the references to "optionee" shall mean the
    original grantee of an option and not any transferee.
 
        (b)  TERMINATION OF EMPLOYMENT DURING LIFETIME.  During the lifetime of
    an optionee, an option granted to such optionee may be exercised only while
    the optionee is employed by the Company or by a parent or subsidiary
    thereof, and only if such optionee has been continuously so employed since
    the date the option was granted, provided that (except as may be otherwise
    provided in the applicable option agreement at the time of grant or
    thereafter):
 
           (i) if an optionee's employment is terminated for cause (which for
       purposes hereof shall mean that the optionee was convicted of a felony or
       the optionee failed to contest prosecution for a felony or the optionee
       engaged in willful misconduct or dishonesty, any of which is directly and
       materially harmful to the business or reputation of the Company), then
       the option shall terminate immediately upon such termination of
       employment;
 
           (ii) if an optionee's employment is voluntarily terminated by the
       optionee, otherwise than in connection with the optionee's retirement
       (which for purposes hereof shall mean (a) retirement from active
       employment with the Company or any subsidiary or parent of the Company
       prior to age 60 with the consent of the Committee or (b) retirement from
       active employment with the Company or any subsidiary or parent of the
       Company on or after age 60) then the option shall continue to be
       exercisable for ten days after the termination of the optionee's
       employment but only to the extent that the option was exercisable
       immediately prior to such optionee's termination of employment;
 
           (iii) if an optionee's employment is terminated by the Company
       otherwise than for cause, then the option shall continue to be
       exercisable for three months after termination of the optionee's
       employment but only to the extent that the option was exercisable
       immediately prior to such optionee's termination of employment;
 
           (iv) if an optionee's employment is terminated by reason of
       retirement, death or disability (which for purposes hereof shall mean
       permanent and total disability as determined by the Committee), then the
       option shall continue to be exercisable for three years after termination
       of the optionee's employment but only to the extent that the option was
       exercisable immediately prior to such optionee's termination of
       employment; and
 
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           (v) as to any optionee whose termination of employment occurs
       following a declaration pursuant to paragraph 14 below, an option may be
       exercised at any time permitted by such declaration.
 
        (c)  TRANSFERS AND LEAVES OF ABSENCE.  Neither the transfer of
    employment of a person to whom an option is granted between any combination
    of the Company, a parent corporation or a subsidiary thereof, nor a leave of
    absence granted to such person and approved by the Committee, shall be
    deemed a termination of employment for purposes of this Plan. The terms
    "parent" or "parent corporation" and "subsidiary" as used in this Plan shall
    have the meaning ascribed to "parent corporation" and "subsidiary
    corporation", respectively, in Sections 424(e) and (f) of the Code.
 
        (d)  RIGHT TO TERMINATE EMPLOYMENT.  Nothing contained in this Plan, or
    in any option granted pursuant to this Plan, shall confer upon any optionee
    any right to continued employment by the Company or any parent or subsidiary
    of the Company or limit in any way the right of the Company or any such
    parent or subsidiary to terminate such optionee's employment at any time.
 
        (e)  EXPIRATION DATE.  In no event shall any option be exercisable at
    any time after the time it shall have expired in accordance with paragraph
    5(d) of this Plan. When an option is no longer exercisable, it shall be
    deemed to have lapsed or terminated and will no longer be outstanding.
 
    13.  CHANGE IN CONTROL.
 
        (a) For purposes of this Plan, a "Change in Control" of the Company
    shall be deemed to occur if any of the following occur:
 
           (1) Any "person" (as such term is used in Sections 13(d) and 14(d) of
       the Exchange Act) acquires or becomes a "beneficial owner" (as defined in
       Rule 13d-3 or any successor rule under the Exchange Act), directly or
       indirectly, of securities of the Company representing 30% or more of the
       combined voting power of the Company's then outstanding securities
       entitled to vote generally in the election of directors ("Voting
       Securities"), provided, however, that the following shall not constitute
       a Change in Control pursuant to this paragraph (a)(1):
 
       (A) any acquisition or beneficial ownership by the Company or a
           subsidiary;
 
       (B) any acquisition or beneficial ownership by any employee benefit plan
           (or related trust) sponsored or maintained by the Company or one or
           more of its subsidiaries;
 
       (C) any acquisition or beneficial ownership by any corporation with
           respect to which, immediately following such acquisition, more than
           70% of both the combined voting power of the Company's then
           outstanding Voting Securities and the Shares of the Company is then
           beneficially owned, directly or indirectly, by all or substantially
           all of the persons who beneficially owned Voting Securities and
           Shares of the Company immediately prior to such acquisition in
           substantially the same proportions as their ownership of such Voting
           Securities and Shares, as the case may be, immediately prior to such
           acquisition;
 
           (2) A majority of the members of the Board of Directors of the
       Company shall not be Continuing Directors. "Continuing Directors" shall
       mean: (A) individuals who, on the date hereof, are directors of the
       Company, (B) individuals elected as directors of the Company subsequent
       to the date hereof for whose election proxies shall have been solicited
       by the Board of Directors of the Company or (C) any individual elected or
       appointed by the Board of Directors of the Company to fill vacancies on
       the Board of Directors of the Company caused by death or resignation (but
       not by removal) or to fill newly-created directorships;
 
           (3) Approval by the shareholders of the Company of a reorganization,
       merger or consolidation of the Company or a statutory exchange of
       outstanding Voting Securities of the Company, unless immediately
       following such reorganization, merger, consolidation or exchange,
 
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       all or substantially all of the persons who were the beneficial owners,
       respectively, of Voting Securities and Shares of the Company immediately
       prior to such reorganization, merger, consolidation or exchange
       beneficially own, directly or indirectly, more than 70% of, respectively,
       the combined voting power of the then outstanding voting securities
       entitled to vote generally in the election of directors and the then
       outstanding shares of common stock, as the case may be, of the
       corporation resulting from such reorganization, merger, consolidation or
       exchange in substantially the same proportions as their ownership,
       immediately prior to such reorganization, merger, consolidation or
       exchange, of the Voting Securities and Stock of the Company, as the case
       may be; or
 
           (4) Approval by the shareholders of the Company of (x) a complete
       liquidation or dissolution of the Company or (y) the sale or other
       disposition of all or substantially all of the assets of the Company (in
       one or a series of transactions), other than to a corporation with
       respect to which, immediately following such sale or other disposition,
       more than 70% of, respectively, the combined voting power of the then
       outstanding voting securities of such corporation entitled to vote
       generally in the election of directors and the then outstanding shares of
       common stock of such corporation is then beneficially owned, directly or
       indirectly, by all or substantially all of the persons who were the
       beneficial owners, respectively, of the Voting Securities and Shares of
       the Company immediately prior to such sale or other disposition in
       substantially the same proportions as their ownership, immediately prior
       to such sale or other disposition, of the Voting Securities and Shares of
       the Company, as the case may be.
 
        (b)  ACCELERATION OF VESTING.  Notwithstanding anything in paragraph
    5(c) above to the contrary, if a Change of Control of the Company shall
    occur, then, without any action by the Committee or the Board, each option
    granted under this Plan and not already exercised in full or otherwise
    terminated, expired or canceled shall become immediately exercisable in
    full.
 
        (c)  CASH PAYMENT.  If a Change in Control of the Company shall occur,
    then, so long as a majority of the members of the Board are Continuing
    Directors, the Committee, in its sole discretion, and without the consent of
    the holder of any option affected thereby, may determine that some or all
    outstanding options shall be cancelled as of the effective date of any such
    Change in Control and that the holder or holders of such cancelled options
    shall receive, with respect to some or all of the Common Shares subject to
    such options, as of the date of such cancellation, cash in an amount, for
    each Share subject to an option, equal to the excess of the per Share Fair
    Market Value of such Shares immediately prior to such Change in Control of
    the Company over the exercise price per Share of such options.
 
        (d)  LIMITATION ON CHANGE IN CONTROL PAYMENTS.  Notwithstanding anything
    in paragraph 13(b) or 13(c) above or paragraph 14 below to the contrary, if,
    with respect to an optionee, the acceleration of the exercisability of an
    option or the payment of cash in exchange for all or part of an option as
    provided in paragraph 13(b) or 13(c) above or paragraph 14 (which
    acceleration or payment could be deemed a "payment" within the meaning of
    Section 280G(b)(2) of the Code), together with any other payments which such
    optionee has the right to receive from the Company or any corporation which
    is a member of an "affiliated group" (as defined in Section 1504(a) of the
    Code without regard to Section 1504(b) of the Code) of which the Company is
    a member, would constitute a "parachute payment" (as defined in Section
    280G(b)(2) of the Code), then such acceleration of exercisability and
    payments pursuant to paragraph 13(b) or 13(c) above or paragraph 14 shall be
    reduced to the largest amount as, in the sole judgment of the Committee,
    will result in no portion of such payments being subject to the excise tax
    imposed by Section 4999 of the Code.
 
    14.  DISSOLUTION, LIQUIDATION, MERGER.  In the event of (a) the proposed
dissolution or liquidation of the Company, (b) a proposed sale of substantially
all of the assets of the Company or (c) a proposed merger, consolidation of the
Company with or into any other entity, regardless of whether the Company is the
 
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surviving corporation, or a proposed statutory share exchange with any other
entity (the actual effective date of the dissolution, liquidation, sale, merger,
consolidation or exchange being herein called an "Event"), the Committee may,
but shall not be obligated to, either (i) if the Event is a merger,
consolidation or statutory share exchange, make appropriate provision for the
protection of outstanding options granted under this Plan by the substitution,
in lieu of such options, of options to purchase appropriate voting common stock
(the "Survivor's Stock") of the corporation surviving any such merger or
consolidation or, if appropriate, the parent corporation of the Company or such
surviving corporation, or, alternatively, by the delivery of a number of shares
of the Survivor's Stock which has a Fair Market Value as of the effective date
of such merger, consolidation or statutory share exchange equal to the product
of (x) the excess of (A) the Event Proceeds per Share (as hereinafter defined)
covered by the option as of such effective date over (B) the exercise price per
Share of the Shares subject to such option, times (y) the number of Shares
covered by such option or (ii) declare, at least twenty days prior to the Event,
and provide written notice to each optionee of the declaration, that each
outstanding option, whether or not then exercisable, shall be canceled at the
time of, or immediately prior to the occurrence of, the Event (unless it shall
have been exercised prior to the occurrence of the Event). In connection with
any declaration pursuant to clause (ii) of the preceding sentence, the Committee
may, but shall not be obligated to, cause payment to be made, within twenty days
after the Event, in exchange for each cancelled option to each holder of an
option that is cancelled, of cash equal to the amount (if any), for each Share
covered by the canceled option, by which the Event Proceeds per Share (as
hereinafter defined) exceeds the exercise price per Share covered by such
option. At the time of any declaration pursuant to clause (ii) of the first
sentence of this paragraph 14, each option that has not previously expired
pursuant to paragraph 5(d)(i) or 5(d)(ii) of this Plan or been cancelled
pursuant to paragraph 13(c) of this Plan shall immediately become exercisable in
full and each holder of an option shall have the right, during the period
preceding the time of cancellation of the option, to exercise his or her option
as to all or any part of the Shares covered thereby. In the event of a
declaration pursuant to clause (ii) of the first sentence of this paragraph 14,
each outstanding option granted pursuant to this Plan that shall not have been
exercised prior to the Event shall be canceled at the time of, or immediately
prior to, the Event, as provided in the declaration, and this Plan shall
terminate at the time of such cancellation, subject to the payment obligations
of the Company provided in this paragraph 14. Notwithstanding the foregoing, no
person holding an option shall be entitled to the payment provided in this
paragraph 14 if such option shall have expired pursuant to paragraph 5(d)(i) or
5(d)(ii) of this Plan or been cancelled pursuant to paragraph 13(c) of this
Plan. For purposes of this paragraph 14, "Event Proceeds per Share" shall mean
the cash plus the fair market value, as determined in good faith by the
Committee, of the non-cash consideration to be received per Share by the
shareholders of the Company upon the occurrence of the Event.
 
    15.  ADJUSTMENTS.  In the event of any reorganization, merger,
consolidation, recapitalization, liquidation, reclassification, stock dividend,
stock split, combination of shares, rights offering, or extraordinary dividend
or divestiture (including a spin-off), or any other change in the corporate
structure or Shares of the Company, the Committee (or if the Company does not
survive any such transaction, a comparable committee of the Board of Directors
of the surviving corporation) may, without the consent of any holder of an
option, make such adjustment as it determines in its discretion to be
appropriate as to the number and kind of securities subject to and reserved
under this Plan and, in order to prevent dilution or enlargement of rights of
participants in this Plan, the number and kind of securities issuable upon
exercise of outstanding options and the exercise price thereof.
 
    16.  SUBSTITUTE OPTIONS.  Options may be granted under this Plan from time
to time in substitution for stock options held by employees of other
corporations who are about to become employees of the Company, or any parent or
subsidiary thereof, or whose employer is about to become a subsidiary of the
Company, as the result of a merger or consolidation of the Company or a
subsidiary of the Company with another corporation, the acquisition by the
Company or a subsidiary of the Company of all or substantially all the assets of
another corporation or the acquisition by the Company or a subsidiary of the
Company of at least 50% of the issued and outstanding stock of another
corporation. The terms and conditions of the
 
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substitute options so granted may vary from the terms and conditions set forth
in this Plan to such extent as the Board at the time of the grant may deem
appropriate to conform, in whole or in part, to the provisions of the stock
options in substitution for which they are granted, but with respect to stock
options which are incentive stock options, no such variation shall be permitted
which affects the status of any such substitute option as an incentive stock
option.
 
    17.  COMPLIANCE WITH LEGAL REQUIREMENTS.
 
        (a)  GENERAL.  No certificate for Shares distributable under this Plan
    shall be issued and delivered unless the issuance of such certificate
    complies with all applicable legal requirements including, without
    limitation, compliance with the provisions of applicable state securities
    laws, the Securities Act of 1933, as amended, and the Exchange Act.
 
        (b)  RULE 16B-3.  With respect to Section 16 Individuals, transactions
    under this Plan are intended to comply with all applicable conditions of
    Rule 16b-3 or its successors under the Exchange Act. To the extent any
    provision of this Plan or action by the Committee fails to so comply, it
    shall be deemed null and void, to the extent permitted by law and deemed
    advisable by the Committee.
 
    18.  GOVERNING LAW.  To the extent that federal laws do not otherwise
control, this Plan and all determinations made and actions taken under this Plan
shall be governed by the laws of the State of Minnesota, without regard to the
conflicts of law provisions thereof, and construed accordingly.
 
    19.  AMENDMENT AND DISCONTINUANCE OF PLAN.  The Board may at any time amend,
suspend or discontinue this Plan; provided, however, that no amendment to this
Plan shall, without the consent of the holder of the option, alter or impair any
option previously granted under this Plan. To the extent considered necessary to
comply with applicable provisions of the Code, any such amendments to this Plan
may be made subject to approval by the shareholders of the Company.
 
    20.  TERM.
 
        (a)  EFFECTIVE DATE.  This Plan shall be effective as of March 24, 1998.
 
        (b)  TERMINATION.  This Plan shall remain in effect until all Shares
    subject to it are distributed or this Plan is terminated under paragraph 19
    above. No award of an incentive stock option shall be made under this Plan
    more than ten years after the effective date of this Plan (or such other
    limit as may be required by the Code) if such limitation is necessary to
    qualify the option as an incentive stock option.
 
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