Exhibit 10.11

                                  VIRAGE, INC.
                       2001 NONSTATUTORY STOCK OPTION PLAN

     1.  Establishment, Purpose and Term of Plan.

         (a) Establishment. The Virage, Inc. 2001 Nonstatutory Stock Option Plan
(the "Plan") is hereby established effective as of April 27, 2001.

         (b) Purpose. The purpose of the Plan is to advance the interests of the
Participating  Company Group and its  stockholders  by providing an incentive to
attract and retain persons  performing  services for the  Participating  Company
Group  and  by  motivating   such  persons  to  contribute  to  the  growth  and
profitability of the Participating Company Group.

         (c) Term of Plan.  The Plan shall  continue in effect until the earlier
of its  termination by the Board or the date on which all of the shares of Stock
available for issuance under the Plan have been issued and all  restrictions  on
such shares under the terms of the Plan and the  agreements  evidencing  Options
granted under the Plan have lapsed.

     2.  Definitions and Construction.

         (a) Definitions.  Whenever used herein,  the following terms shall have
their respective meanings set forth below:

                  i. "Board" means the Board of Directors of the Company. If one
or more  Committees  have been  appointed by the Board to  administer  the Plan,
"Board" also means such Committee(s).

                  ii.  "Code"  means  the  Internal  Revenue  Code of  1986,  as
amended, and any applicable regulations promulgated thereunder.

                  iii.  "Committee"  means the  Compensation  Committee or other
committee  of the Board duly  appointed to  administer  the Plan and having such
powers as shall be  specified by the Board.  Unless the powers of the  Committee
have been  specifically  limited,  the Committee shall have all of the powers of
the Board granted herein, including,  without limitation,  the power to amend or
terminate  the  Plan at any  time,  subject  to the  terms  of the  Plan and any
applicable limitations imposed by law.

                  iv. "Company" means Virage, Inc., a Delaware  corporation,  or
any successor corporation thereto.

                  v.  "Consultant"  means  any  person,  including  an  advisor,
engaged by a Participating  Company to render services other than as an Employee
or a Director.

                  vi.  "Director" means a member of the Board or of the board of
directors of any other Participating Company.

                  vii.  "Disability" means the inability of the Optionee, in the
opinion of a qualified physician acceptable to the Company, to perform the major
duties of the Optionee's  position with the Participating  Company Group because
of the sickness or injury of the Optionee.

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                  viii.  "Employee"  means any  person  treated  as an  employee
(including  an officer or a Director  who is also treated as an employee) in the
records of a Participating Company; provided, however, that neither service as a
Director  nor payment of a  director's  fee shall be  sufficient  to  constitute
employment for purposes of the Plan.

                  ix. "Exchange Act" means the Securities  Exchange Act of 1934,
as amended.

                  x. "Fair Market Value" means,  as of any date,  the value of a
share of Stock  or  other  property  as  determined  by the  Board,  in its sole
discretion,  or by the Company, in its sole discretion, if such determination is
expressly allocated to the Company herein, subject to the following:

                           (a) If, on such  date,  there is a public  market for
the Stock,  the Fair Market  Value of a share of Stock shall be the closing sale
price of a share of Stock (or the mean of the closing bid and asked  prices of a
share of Stock if the  Stock is so  quoted  instead)  as  quoted  on the  Nasdaq
National Market,  the Nasdaq Small-Cap Market or such other national or regional
securities  exchange or market system  constituting  the primary  market for the
Stock,  as  reported  in the Wall  Street  Journal or such  other  source as the
Company deems reliable. If the relevant date does not fall on a day on which the
Stock has traded on such securities exchange or market system, the date on which
the Fair Market  Value shall be  established  shall be the last day on which the
Stock was so traded prior to the relevant date, or such other appropriate day as
shall be determined by the Board, in its sole discretion.

                           (b) If, on such date,  there is no public  market for
the Stock,  the Fair Market Value of a share of Stock shall be as  determined by
the Board without regard to any restriction  other than a restriction  which, by
its terms, will never lapse.

                  xi.  "Nonstatutory  Stock Option" means an Option not intended
to qualify as an incentive stock option within the meaning of Section 422 of the
Code, as set forth in the Option Agreement.

                  xii.  "Option"  means a right to  purchase  Stock  (subject to
adjustment as provided in Section 4.2)  pursuant to the terms and  conditions of
the Plan. Options are intended to be Nonstatutory Stock Options.

                  xiii. "Option Agreement" means a written agreement between the
Company and an Optionee setting forth the terms,  conditions and restrictions of
the Option  granted to the  Optionee and any shares  acquired  upon the exercise
thereof.

                  xiv.  "Optionee"  means a person who has been  granted  one or
more Options.

                  xv. "Parent  Corporation"  means any present or future "parent
corporation" of the Company, as defined in Section 424(e) of the Code.

                  xvi.  "Participating  Company" means the Company or any Parent
Corporation or Subsidiary Corporation.

                  xvii.  "Participating  Company  Group" means,  at any point in
time, all corporations collectively which are then Participating Companies.

                  xviii.  "Securities  Act" means the Securities Act of 1933, as
amended.

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                  xix. "Service" means an Optionee's  employment or service with
the  Participating  Company  Group,  whether in the capacity of an  Employee,  a
Director or a  Consultant.  The  Optionee's  Service shall not be deemed to have
terminated  merely  because of a change in the  capacity  in which the  Optionee
renders  Service  to  the  Participating  Company  Group  or  a  change  in  the
Participating Company for which the Optionee renders such Service, provided that
there is no interruption or termination of the Optionee's Service.  Furthermore,
an Optionee's  Service with the Participating  Company Group shall not be deemed
to have  terminated if the Optionee  takes any military  leave,  sick leave,  or
other bona fide leave of absence  approved by the  Company;  provided,  however,
that if any such leave exceeds ninety (90) days, on the ninety-first  (91st) day
of such leave the Optionee's  Service shall be deemed to have terminated  unless
the Optionee's right to return to Service with the  Participating  Company Group
is  guaranteed by statute or contract.  Notwithstanding  the  foregoing,  unless
otherwise designated by the Company or required by law, a leave of absence shall
not be  treated  as  Service  for  purposes  of  determining  vesting  under the
Optionee's  Option  Agreement.  The  Optionee's  Service shall be deemed to have
terminated either upon an actual  termination of Service or upon the corporation
for which the Optionee  performs Service ceasing to be a Participating  Company.
Subject to the foregoing,  the Company, in its sole discretion,  shall determine
whether the  Optionee's  Service has  terminated  and the effective date of such
termination.

                  xx. "Stock" means the common stock of the Company, as adjusted
from time to time in accordance with Section 4.2.

                  xxi.  "Subsidiary  Corporation"  means any  present  or future
"subsidiary  corporation"  of the Company,  as defined in Section  424(f) of the
Code.

         (b)  Construction.   Captions  and  titles  contained  herein  are  for
convenience  only and shall not affect  the  meaning  or  interpretation  of any
provision of the Plan.  Except when  otherwise  indicated  by the  context,  the
singular shall include the plural and the plural shall include the singular. Use
of the term "or" is not  intended to be  exclusive,  unless the context  clearly
requires otherwise.

     3. Administration.

         (a)  Administration by the Board. The Plan shall be administered by the
Board.  All  questions of  interpretation  of the Plan or of any Option shall be
determined by the Board, and such determinations shall be final and binding upon
all  persons  having an interest  in the Plan or such  Option.  Any officer of a
Participating  Company  shall have the authority to act on behalf of the Company
with respect to any matter, right,  obligation,  determination or election which
is the  responsibility of or which is allocated to the Company herein,  provided
the  officer  has  apparent  authority  with  respect  to  such  matter,  right,
obligation, determination or election.

         (b) Powers of the Board.  In addition to any other  powers set forth in
the Plan and  subject to the  provisions  of the Plan,  the Board shall have the
full and final power and authority, in its sole discretion:

                  i. to determine the persons to whom,  and the time or times at
which,  Options shall be granted and the number of shares of Stock to be subject
to each Option;

                  ii. to  determine  the Fair Market Value of shares of Stock or
other property;

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                  iii.  to  determine  the terms,  conditions  and  restrictions
applicable to each Option (which need not be identical) and any shares  acquired
upon the exercise thereof, including, without limitation, (i) the exercise price
of the Option, (ii) the method of payment for shares purchased upon the exercise
of the  Option,  (iii)  the  method  for  satisfaction  of any  tax  withholding
obligation  arising in connection  with the Option or such shares,  including by
the  withholding  or  delivery of shares of stock,  (iv) the  timing,  terms and
conditions  of the  exercisability  of the  Option or the  vesting of any shares
acquired  upon  the  exercise  thereof,  (v) the time of the  expiration  of the
Option,  (vi) the  effect of the  Optionee's  termination  of  Service  with the
Participating Company Group on any of the foregoing,  and (vii) all other terms,
conditions  and  restrictions  applicable  to the  Option  or  such  shares  not
inconsistent with the terms of the Plan;

                  iv. to approve one or more forms of Option Agreement;

                  v.  to  amend,  modify,  extend,  cancel,  renew,  reprice  or
otherwise  adjust the exercise  price of, or grant a new Option in  substitution
for, any Option or to waive any  restrictions  or  conditions  applicable to any
Option or any shares acquired upon the exercise thereof;

                  vi.   to   accelerate,   continue,   extend   or   defer   the
exercisability  of any Option or the  vesting of any  shares  acquired  upon the
exercise  thereof,  including with respect to the period following an Optionee's
termination of Service with the Participating Company Group;

                  vii. to  prescribe,  amend or rescind  rules,  guidelines  and
policies  relating  to the Plan,  or to adopt  supplements  to,  or  alternative
versions  of,  the Plan,  including,  without  limitation,  as the  Board  deems
necessary  or desirable  to comply with the laws of, or to  accommodate  the tax
policy or  custom  of,  foreign  jurisdictions  whose  citizens  may be  granted
Options;

                  viii.  to  delegate  to any proper  officer of the Company the
authority to grant one or more Options,  without further  approval of the Board,
to any person eligible  pursuant to Section 5; provided,  however,  that (i) the
exercise  price per share of each such Option  shall be equal to the Fair Market
Value per share of the Stock on the  effective  date of grant (or,  if the Stock
has not traded on such date, on the last day  preceding  the  effective  date of
grant on which the Stock was traded), and (ii) each such Option shall be subject
to the terms and conditions of the appropriate standard form of Option Agreement
approved by the Board and shall  conform to the  provisions of the Plan and such
other guidelines as shall be established from time to time by the Board; and

                  ix. to correct any defect,  supply any  omission or  reconcile
any  inconsistency  in the Plan or any  Option  Agreement  and to make all other
determinations  and take such  other  actions  with  respect  to the Plan or any
Option as the Board may deem  advisable to the extent  consistent  with the Plan
and applicable law.

     4. Shares Subject to Plan.

         (a)  Maximum  Number of  Shares  Issuable.  Subject  to  adjustment  as
provided in Section  4.2, the maximum  aggregate  number of shares of Stock that
may be issued  under the Plan shall be 900,000 and shall  consist of  authorized
but unissued or reacquired  shares of Stock or any  combination  thereof.  If an
outstanding Option for any reason expires or is terminated or canceled or shares
of Stock  acquired  subject to  repurchase  upon the  exercise  of an Option are
repurchased by the Company at the Optionee's original exercise price, the shares
of Stock allocable to the unexercised portion of such Option or such repurchased
shares of Stock shall again be available for issuance under the Plan.

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         (b) Adjustments for Changes in Capital  Structure.  In the event of any
stock dividend, stock split, reverse stock split, recapitalization, combination,
reclassification  or similar  change in the capital  structure  of the  Company,
appropriate  adjustments shall be made in the number and class of shares subject
to the Plan and to any  outstanding  Options and in the exercise price per share
of any  outstanding  Options.  If a majority of the shares which are of the same
class as the shares that are subject to  outstanding  Options are exchanged for,
converted  into,  or otherwise  become  (whether or not pursuant to an Ownership
Change Event, as defined in Section 8.1) shares of another corporation (the "New
Shares"),  the Board may unilaterally  amend the outstanding  Options to provide
that such  Options  are  exercisable  for New  Shares.  In the event of any such
amendment, the number of shares subject to, and the exercise price per share of,
the  outstanding  Options  shall be adjusted in a fair and  equitable  manner as
determined by the Board, in its sole discretion.  Notwithstanding the foregoing,
any fractional  share resulting from an adjustment  pursuant to this Section 4.2
shall be rounded up or down to the nearest  whole  number,  as determined by the
Board,  and in no event may the exercise  price of any Option be decreased to an
amount less than the par value, if any, of the stock subject to the Option.  The
adjustments determined by the Board pursuant to this Section 4.2 shall be final,
binding and conclusive.

     5. Eligibility.

Options may be granted only to Employees  and  Consultants;  provided,  however,
that no Option  shall be granted to any person whose  eligibility  to receive an
Option  under the Plan at the time of grant would  require  the  approval of the
Company's  stockholders  pursuant to any  applicable  law,  regulation  or rule,
including  without  limitation,  the  rules  applicable  to the  listing  of the
Company's  securities on the Nasdaq National Market System.  For purposes of the
foregoing  sentence,  "Employees" and  "Consultants"  shall include  prospective
Employees and prospective  Consultants to whom Options are granted in connection
with written  offers of an  employment or other  service  relationship  with the
Participating  Company Group.  Eligible persons may be granted more than one (1)
Option.

     6. Terms and Conditions of Options.

Options shall be evidenced by Option Agreements  specifying the number of shares
of Stock  covered  thereby,  in such form as the Board  shall  from time to time
establish. No Option or purported Option shall be a valid and binding obligation
of the Company unless  evidenced by a fully executed  Option  Agreement.  Option
Agreements may  incorporate all or any of the terms of the Plan by reference and
shall comply with and be subject to the following terms and conditions:

         (a)  Exercise  Price.  The  exercise  price  for each  Option  shall be
established in the sole  discretion of the Board;  provided,  however,  that the
exercise price per share for an Option shall be not less than the par value of a
share of Stock on the effective date of grant of the Option.

         (b)  Exercise  Period.  Options  shall be  exercisable  at such time or
times,  or upon such event or events,  and  subject to such  terms,  conditions,
performance  criteria,  and restrictions as shall be determined by the Board and
set forth in the Option  Agreement  evidencing such Option;  provided,  however,
that no Option granted to a prospective  Employee or prospective  Consultant may
become exercisable prior to the date on which such person commences Service with
a Participating Company. Subject to the foregoing, unless otherwise specified by
the Board in the grant of an Option,  any Option granted  hereunder shall have a
term of ten (10) years from the effective date of grant of the Option.

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         (c) Payment of Exercise Price.

                  i.  Forms of  Consideration  Authorized.  Except as  otherwise
provided below,  payment of the exercise price for the number of shares of Stock
being  purchased  pursuant to any Option shall be made (i) in cash, by check, or
cash equivalent, (ii) by tender to the Company, or attestation to the ownership,
of  shares  of  Stock  owned by the  Optionee  having a Fair  Market  Value  (as
determined by the Company without regard to any restrictions on  transferability
applicable  to such  stock by  reason of  federal  or state  securities  laws or
agreements  with an  underwriter  for the  Company)  not less than the  exercise
price, (iii) by the assignment of the proceeds of a sale or loan with respect to
some or all of the  shares  being  acquired  upon  the  exercise  of the  Option
(including,   without  limitation,   through  an  exercise  complying  with  the
provisions  of  Regulation  T as  promulgated  from time to time by the Board of
Governors of the Federal  Reserve System) (a "Cashless  Exercise"),  (iv) by the
Optionee's  promissory note in a form approved by the Company, (v) by such other
consideration  as may be  approved  by the Board from time to time to the extent
permitted by applicable law, or (vi) by any combination  thereof.  The Board may
at any time or from time to time, by adoption of or by amendment to the standard
form of Option  Agreement  described  in  Section  7, or by other  means,  grant
Options which do not permit all of the foregoing  forms of  consideration  to be
used in payment of the exercise  price or which  otherwise  restrict one or more
forms of consideration.

                  ii. Tender of Stock.  Notwithstanding the foregoing, an Option
may not be exercised by tender to the Company,  or attestation to the ownership,
of shares of Stock to the extent such tender,  or  attestation to the ownership,
of Stock would  constitute a violation of the provisions of any law,  regulation
or agreement restricting the redemption of the Company's stock. Unless otherwise
provided by the Board,  an Option may not be exercised by tender to the Company,
or attestation  to the  ownership,  of shares of Stock unless such shares either
have  been  owned by the  Optionee  for more  than  six (6)  months  or were not
acquired, directly or indirectly, from the Company.

                  iii. Cashless Exercise.  The Company reserves,  at any and all
times, the right, in the Company's sole and absolute  discretion,  to establish,
decline to approve or terminate  any program or  procedures  for the exercise of
Options by means of a Cashless Exercise.

                  iv.  Payment by Promissory  Note. No promissory  note shall be
permitted  if the  exercise  of an Option  using a  promissory  note  would be a
violation of any law. Any  permitted  promissory  note shall be on such terms as
the Board shall  determine  at the time the Option is  granted.  The Board shall
have the  authority to permit or require the  Optionee to secure any  promissory
note used to  exercise  an Option  with the  shares of Stock  acquired  upon the
exercise  of the  Option or with other  collateral  acceptable  to the  Company.
Unless otherwise provided by the Board, if the Company at any time is subject to
the  regulations  promulgated  by the Board of Governors of the Federal  Reserve
System or any other  governmental  entity  affecting  the extension of credit in
connection with the Company's securities,  any promissory note shall comply with
such applicable regulations, and the Optionee shall pay the unpaid principal and
accrued interest, if any, to the extent necessary to comply with such applicable
regulations.

         (d) Tax  Withholding.  The  Company  shall have the right,  but not the
obligation,  to deduct from the shares of Stock issuable upon the exercise of an
Option,  or to accept from the  Optionee the tender of, a number of whole shares
of Stock having a Fair Market Value, as determined by the Company,  equal to all
or any part of the federal,  state, local and foreign taxes, if any, required by
law to be  withheld  by the  Participating  Company  Group with  respect to such
Option or the shares  acquired upon the exercise  thereof.  Alternatively  or in
addition,  in its sole  discretion,  the Company shall have the right to require
the Optionee, through payroll withholding, cash payment or otherwise,  including
by means of a Cashless  Exercise,  to make  adequate  provision for any such tax
withholding obligations of the Participating Company Group arising in connection
with the Option or the shares  acquired upon the exercise  thereof.  The Company
shall  have no  obligation  to deliver  shares of Stock or to release  shares of
Stock from an escrow  established  pursuant  to the Option  Agreement  until the
Participating Company Group's tax withholding obligations have been satisfied by
the Optionee.

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         (e) Repurchase Rights. Shares issued under the Plan may be subject to a
right of first refusal,  one or more repurchase options, or other conditions and
restrictions  as determined by the Board in its sole  discretion at the time the
Option is granted.  The  Company  shall have the right to assign at any time any
repurchase right it may have, whether or not such right is then exercisable,  to
one or more  persons as may be  selected  by the  Company.  Upon  request by the
Company,  each Optionee  shall execute any  agreement  evidencing  such transfer
restrictions  prior to the  receipt  of  shares  of Stock  hereunder  and  shall
promptly present to the Company any and all certificates  representing shares of
Stock acquired  hereunder for the placement on such  certificates of appropriate
legends evidencing any such transfer restrictions.

         (f) Effect of Termination of Service.

                  i. Option  Exercisability.  Subject to earlier  termination of
the Option as otherwise provided herein, an Option shall be exercisable after an
Optionee's termination of Service as follows:

                           (a)  Disability.  If the Optionee's  Service with the
Participating  Company  Group is  terminated  because of the  Disability  of the
Optionee,  the Option, to the extent  unexercised and exercisable on the date on
which the Optionee's  Service  terminated,  may be exercised by the Optionee (or
the  Optionee's  guardian  or legal  representative)  at any  time  prior to the
expiration  of twelve (12)  months (or such longer or shorter  period of time as
determined by the Board, in its sole discretion, which in no event shall be less
than six (6) months) after the date on which the Optionee's Service  terminated,
but in any event no later than the date of  expiration  of the Option's  term as
set forth in the Option Agreement evidencing such Option (the "Option Expiration
Date").

                           (b)  Death.  If  the  Optionee's   Service  with  the
Participating  Company Group is terminated because of the death of the Optionee,
the Option,  to the extent  unexercised and exercisable on the date on which the
Optionee's  Service  terminated,  may  be  exercised  by  the  Optionee's  legal
representative  or other person who acquired the right to exercise the Option by
reason of the  Optionee's  death at any time prior to the  expiration  of twelve
(12)  months (or such  longer or  shorter  period of time as  determined  by the
Board,  in its sole  discretion,  which in no event  shall be less  than six (6)
months) after the date on which the Optionee's  Service  terminated,  but in any
event no later than the Option Expiration Date. The Optionee's  Service shall be
deemed to have  terminated on account of death if the Optionee dies within three
(3) months after the Optionee's termination of Service.

                           (c) Other  Termination of Service.  If the Optionee's
Service with the Participating  Company Group terminates for any reason,  except
Disability or death,  the Option,  to the extent  unexercised and exercisable by
the  Optionee on the date on which the  Optionee's  Service  terminated,  may be
exercised  by the  Optionee  within  three (3) months (or such longer or shorter
period of time as determined by the Board, in its sole  discretion,  which in no
event  shall be less  than  thirty  (30)  days)  after  the  date on  which  the
Optionee's  Service  terminated,  but in any  event  no later  than  the  Option
Expiration Date.

                  ii.  Extension if Exercise  Prevented by Law.  Notwithstanding
the foregoing,  if the exercise of an Option within the applicable  time periods
set forth in Section  6.6(a) is prevented by the provisions of Section 11 below,
the Option  shall remain  exercisable  until three (3) months after the date the
Optionee is notified by the Company that the Option is  exercisable,  but in any
event no later than the Option Expiration Date.

                  iii.   Extension  if  Optionee   Subject  to  Section   16(b).
Notwithstanding the foregoing,  if a sale within the applicable time periods set
forth in Section 6.6(a) of shares acquired upon the exercise of the Option would
subject the Optionee to suit under Section 16(b) of the Exchange Act, the Option
shall remain exercisable until the earliest to occur of (i) the tenth (10th) day
following  the  date on which a sale of such  shares  by the  Optionee  would no
longer be subject to such suit,  (ii) the one hundred and ninetieth  (190th) day
after the  Optionee's  termination  of Service,  or (iii) the Option  Expiration
Date.

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     7. Standard Forms of Option Agreement.

         (a)  General.  Unless  otherwise  provided by the Board at the time the
Option is granted,  an Option  shall comply with and be subject to the terms and
conditions  set  forth in the form of  Option  Agreement  adopted  by the  Board
concurrently with its adoption of the Plan and as amended from time to time.

         (b) Authority to Vary Terms.  The Board shall have the  authority  from
time  to time to  vary  the  terms  of any of the  standard  form(s)  of  Option
Agreement  described  in this Section 7 either in  connection  with the grant or
amendment of an individual  Option or in connection with the  authorization of a
new standard form or forms; provided,  however, that the terms and conditions of
any such new,  revised or  amended  standard  form or forms of Option  Agreement
shall be in accordance with the terms of the Plan.

     8. Change in Control.

         (a) Definitions.

                  i.  An  "Ownership  Change  Event"  shall  be  deemed  to have
occurred if any of the following occurs with respect to the Company:

                           (a) the  direct or  indirect  sale or  exchange  in a
single or series of related  transactions by the  stockholders of the Company of
more than fifty percent (50%) of the voting stock of the Company;

                           (b) a merger or consolidation in which the Company is
a party;

                           (c)  the  sale,  exchange,  or  transfer  of  all  or
substantially all of the assets of the Company; or

                           (d) a liquidation or dissolution of the Company.

                  ii. A "Change in Control" shall mean an Ownership Change Event
or a series of related Ownership Change Events (collectively, the "Transaction")
wherein the  stockholders of the Company  immediately  before the Transaction do
not  retain  immediately  after  the  Transaction,  in  substantially  the  same
proportions  as  their  ownership  of  shares  of  the  Company's  voting  stock
immediately before the Transaction,  direct or indirect beneficial  ownership of
more  than  fifty  percent  (50%)  of the  total  combined  voting  power of the
outstanding  voting stock of the Company or the  corporation or  corporations to
which  the   assets  of  the   Company   were   transferred   (the   "Transferee
Corporation(s)"),  as the case may be. For purposes of the  preceding  sentence,
indirect beneficial  ownership shall include,  without  limitation,  an interest
resulting from ownership of the voting stock of one or more corporations  which,
as  a  result  of  the   Transaction,   own  the   Company  or  the   Transferee
Corporation(s),  as the case may be,  either  directly  or  through  one or more
subsidiary  corporations.  The Board shall have the right to  determine  whether
multiple  sales or  exchanges  of the voting  stock of the  Company or  multiple
Ownership  Change  Events are  related,  and its  determination  shall be final,
binding and conclusive.

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         (b) Effect of Change in Control on Options. In the event of a Change in
Control,  the surviving,  continuing,  successor,  or purchasing  corporation or
parent corporation  thereof,  as the case may be (the "Acquiring  Corporation"),
may either assume the Company's rights and obligations under outstanding Options
or substitute for outstanding Options  substantially  equivalent options for the
Acquiring Corporation's stock. For purposes of this Section 8.2, an Option shall
be deemed  assumed if,  following the Change in Control,  the Option confers the
right to purchase in accordance with its terms and conditions, for each share of
Stock  subject to the Option  immediately  prior to the Change in  Control,  the
consideration  (whether stock,  cash or other securities or property) to which a
holder of a share of Stock on the  effective  date of the Change in Control  was
entitled.  Any  Options  which are  neither  assumed or  substituted  for by the
Acquiring  Corporation in connection with the Change in Control nor exercised as
of the date of the Change in Control shall terminate and cease to be outstanding
effective  as of  the  date  of  the  Change  in  Control.  Notwithstanding  the
foregoing,  shares  acquired  upon  exercise of an Option prior to the Change in
Control and any  consideration  received  pursuant to the Change in Control with
respect to such shares shall continue to be subject to all applicable provisions
of the Option Agreement  evidencing such Option except as otherwise  provided in
such  Option  Agreement.  Furthermore,  notwithstanding  the  foregoing,  if the
corporation the stock of which is subject to the outstanding Options immediately
prior to an Ownership Change Event described in Section 8.1(a)(i) constituting a
Change in Control is the surviving or  continuing  corporation  and  immediately
after such  Ownership  Change Event less than fifty  percent  (50%) of the total
combined  voting power of its voting stock is held by another  corporation or by
other corporations that are members of an affiliated group within the meaning of
Section  1504(a) of the Code without regard to the provisions of Section 1504(b)
of the Code,  the  outstanding  Options  shall not  terminate  unless  the Board
otherwise provides in its sole discretion.

     9. Provision of Information.

Each  Optionee  shall be given  access to  information  concerning  the  Company
equivalent to that information  generally made available to the Company's common
stockholders.

     10. Nontransferability of Options.

During the lifetime of the Optionee,  an Option shall be exercisable only by the
Optionee or the Optionee's guardian or legal representative.  No Option shall be
assignable or  transferable  by the  Optionee,  except by will or by the laws of
descent and distribution. Notwithstanding the foregoing, to the extent permitted
by the  Board,  in its  discretion,  and  set  forth  in  the  Option  Agreement
evidencing such Option, an Option shall be assignable or transferable subject to
the applicable  limitations,  if any,  described in the General  Instructions to
Form S-8 Registration Statement under the Securities Act.

     11. Compliance with Securities Law.

The grant of  Options  and the  issuance  of shares of Stock  upon  exercise  of
Options  shall be subject to  compliance  with all  applicable  requirements  of
federal, state and foreign law with respect to such securities.  Options may not
be exercised if the issuance of shares of Stock upon exercise would constitute a
violation of any applicable  federal,  state or foreign securities laws or other
law or  regulations or the  requirements  of any stock exchange or market system
upon which the Stock may then be listed. In addition, no Option may be exercised
unless (a) a registration  statement  under the Securities Act shall at the time
of exercise of the Option be in effect with respect to the shares  issuable upon
exercise  of the Option or (b) in the opinion of legal  counsel to the  Company,
the shares issuable upon exercise of the Option may be issued in accordance with
the terms of an applicable  exemption from the registration  requirements of the
Securities  Act. The inability of the Company to obtain from any regulatory body
having jurisdiction the authority, if any, deemed by the Company's legal 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.
As a  condition  to the  exercise  of any  Option,  the  Company may require the
Optionee to satisfy any qualifications that may be necessary or appropriate,  to
evidence  compliance  with  any  applicable  law or  regulation  and to make any
representation  or warranty  with  respect  thereto as may be  requested  by the
Company.

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     12. Indemnification.

In addition to such other rights of  indemnification as they may have as members
of the Board or  officers  or  employees  of the  Participating  Company  Group,
members of the Board and any officers or employees of the Participating  Company
Group to whom  authority to act for the Board or the Company is delegated  shall
be  indemnified  by the  Company  against  all  reasonable  expenses,  including
attorneys'  fees,  actually  and  necessarily  incurred in  connection  with the
defense of any action,  suit or  proceeding,  or in  connection  with any appeal
therein,  to which  they or any of them may be a party by reason  of any  action
taken or  failure  to act under or in  connection  with the  Plan,  or any right
granted  hereunder,  and against all amounts paid by them in settlement  thereof
(provided such settlement is approved by independent  legal counsel  selected by
the Company) or paid by them in  satisfaction  of a judgment in any such action,
suit or  proceeding,  except  in  relation  to  matters  as to which it shall be
adjudged in such action, suit or proceeding that such person is liable for gross
negligence,  bad faith or intentional misconduct in duties;  provided,  however,
that  within  sixty  (60) days after the  institution  of such  action,  suit or
proceeding,  such person shall offer to the Company, in writing, the opportunity
at its own expense to handle and defend the same.

     13. Termination or Amendment of Plan.

The Board may terminate or amend the Plan at any time.  However,  no termination
or amendment of the Plan may adversely affect any then outstanding Option or any
unexercised  portion thereof,  without the consent of the Optionee,  unless such
termination  or  amendment  is  necessary  to comply  with any  applicable  law,
regulation or rule.

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