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                                                                   EXHIBIT 10.4

  FORM OF $125 NONQUALIFIED STOCK OPTION AGREEMENT UNDER THE REGISTRANT'S 1996
                           STOCK OPTION AND AWARD PLAN

                            TRANSAMERICA CORPORATION
                       NONQUALIFIED STOCK OPTION AGREEMENT

                  Transamerica  Corporation  (the "Company")  hereby grants you,
[NAME OF  EMPLOYEE]  (the  "Employee"),  a  nonqualified  stock option under the
Company's 1996 Stock Option and Award Plan (the "Plan"),  to purchase  shares of
common  stock of the Company  ("Shares").  The date of this  Agreement is [DATE]
(the "Grant Date"). In general, the latest date this option will expire is [DATE
10 YEARS FROM GRANT  DATE] (the  "Expiration  Date").  However,  as  provided in
Appendix A (attached hereto), this option may expire earlier than the Expiration
Date. Subject to the provisions of Appendix A (attached hereto) and of the Plan,
the principal features of this option are as follows:

Maximum Number of Shares
Purchasable with this Option:  [NUMBER]       Purchase Price per Share:  $125.00
----------------------------                  ------------------------ 

Scheduled  Vesting  Dates                           Number of Shares 
[DATE 3 YEARS FROM GRANT  DATE]                     [# of Shares] 
[DATE 4 YEARS FROM GRANT DATE]                      [# of Shares] 
[DATE 5 YEARS FROM GRANT DATE]                      [# of Shares]

 Event Triggering Termination of Option           Maximum Time to Exercise After
                                                          Triggering Event*
 Termination of Employment due to Disability                3 years
 Termination of Employment due to Early or 
    Normal Retirement                                       5 years
 Termination of Employment due to death                     3 years
 Termination of Employment within 1 year after
    a Change of Control for a reason other than 
    Disability, Early or Normal                             1 year
 Retirement or death
 All other Terminations of Employment                       3 months

*    However, in no event may this option be exercised after the Expiration Date
     (except in certain cases of the death of the Employee).

                  Your   signature    below   indicates   your   agreement   and
understanding  that this  option is subject  to all of the terms and  conditions
contained  in  Appendix  A and  the  Plan.  For  example,  important  additional
information on vesting and termination of this option is contained in Paragraphs
4 through 7 of Appendix A.  ACCORDINGLY,  PLEASE BE SURE TO READ ALL OF APPENDIX
A, WHICH CONTAINS THE SPECIFIC TERMS AND CONDITIONS OF THIS OPTION.

TRANSAMERICA CORPORATION                   EMPLOYEE



By_______________________                   _______________________
 Title:                                      [NAME]




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                                   APPENDIX A

               TERMS AND CONDITIONS OF NONQUALIFIED STOCK OPTIONS

                  1. Grant of Option.  The Company hereby grants to the Employee
under the Plan, as a separate incentive in connection with his or her employment
and not in lieu of any salary or other  compensation for his or her services,  a
nonqualified stock option to purchase,  on the terms and conditions set forth in
this Agreement and the Plan, all or any part of an aggregate of [NUMBER] Shares.
The option granted hereby is not intended to be an Incentive Stock Option within
the meaning of Section 422 of the Code.

                  2.  Exercise Price.  The  purchase  price  per Share for  this
option (the "Exercise Price") shall  be $125.00.                   

                  3. Number of Shares.  The number and class of Shares specified
in Paragraph 1 above,  and/or the Exercise  Price,  are subject to adjustment by
the  Committee  in the  event  of  any  merger,  reorganization,  consolidation,
recapitalization,  separation,  liquidation,  stock  dividend,  split-up,  Share
combination,  distribution  or other  change in the  corporate  structure of the
Company affecting the Shares (an "Event").  Any such adjustment shall be made by
the Committee as  constituted  immediately  prior to the  applicable  Event (the
"Applicable  Committee")  and shall be designed so that if the  Employee (or any
beneficiary) exercises this option after an Event, he or she shall receive (upon
payment of the Exercise  Price for each Share  exercised) the securities and any
other  property  (other than  regular  cash  dividends)  which the  Employee (or
beneficiary)  would have been  entitled  to had he or she instead  acquired  the
Shares  on  the  Grant  Date  and  held  them  through  the  date  of  exercise.
Notwithstanding  the preceding,  (a) the number of Shares subject to this option
always shall be a whole number, and (b) if the Applicable  Committee  determines
that the delivery of securities or other  property  (other than Shares) from any
such  adjustment  would  create an undue  burden or expense,  the  Employee  (or
beneficiary)  instead  shall  receive a lump sum cash payment  equal to the fair
market value (as determined by the Applicable  Committee) of such  securities or
other property.

     4. Vesting Schedule.  This option is scheduled to become  exercisable as to
33 1/3% of the shares  subject to such option on the third  anniversary  date of
the Grant Date, and as to an additional 33 1/3% on each  succeeding  anniversary
date, until the right to exercise this option shall have accrued with respect to
100% of the Shares  subject to this option.  However,  on any scheduled  vesting
date,  vesting  actually will occur only if the Employee  remains an Employee on
such  date.  Notwithstanding  the  foregoing,  in the  event  of the  Employee's
Termination of Employment due to Early Retirement, Normal Retirement, Disability
or death,  the right to  exercise a portion of such Shares will vest on the date
that such right otherwise would have vested,  as determined in the discretion of
the Committee  based on the time elapsed from the Grant Date to the  Termination
of Employment and the vesting date.

                  5. Change of Control.  In the event a Change of Control occurs
prior to the Employee's  Termination  of  Employment,  the right to exercise one
hundred  percent  (100%) of the Shares  subject to this  option will vest on the
date on which the Change of Control occurs.

                  6.  Termination  of  Option.  Except as  provided  in the last
sentence of this  Paragraph  6, in the event of the  Employee's  Termination  of
Employment for any reason other than Early or Normal  Retirement,  Disability or
death,  the  Employee  may,  within  three  (3)  months  after  the date of such
Termination,  or prior to the  Expiration  Date,  whichever  shall first  occur,
exercise any vested but unexercised  portion of this option. In the event of the
Employee's Termination of Employment due to Disability, the Employee may, within
three (3) years after the date of such  Termination,  or prior to the Expiration
Date,  whichever shall first occur,  exercise any vested but unexercised portion
of this option. In the event of the Employee's  Termination of Employment due to
Early or Normal  Retirement,  the Employee  may,  within five (5) years from the
date of such Termination, or prior to the Expiration Date, whichever shall first
occur,  exercise any vested but unexercised portion of this option. In the event
of the Employee's  Termination  of Employment  within one year after a Change of
Control  for any reason  other than Early or Normal  Retirement,  Disability  or
death, the Employee may, within one (1) year after the date of such Termination,
or prior to the  Expiration  Date,  whichever  shall first  occur,  exercise any
vested but unexercised portion of this option.

                  7.  Death of  Employee.  In the event that the  Employee  dies
prior to the  expiration  of this option in  accordance  with the  provisions of
Paragraph 6 above, the Employee's designated beneficiary or beneficiaries, or if
no  beneficiary  survives the  Employee,  the  administrator  or executor of the
Employee's estate, may, within three (3) years after the date of death, exercise
any vested but  unexercised  portion of this option.  Any such  transferee  must
furnish the Company (a) written notice of his or her status as a transferee, (b)
evidence  satisfactory  to the Company to establish the validity of the transfer
of this option and compliance  with any laws or  regulations  pertaining to such
transfer,  and (c) written acceptance of the terms and conditions of this option
as set forth in this Agreement.

                  8. Persons Eligible to Exercise  Option.  This option shall be
exercisable during the Employee's  lifetime only by the Employee.  The option is
not  transferable  except that the Employee  may  transfer  this option (a) by a
valid  beneficiary  designation  made in a form  and  manner  acceptable  to the
Committee, or (b) by will or the applicable laws of descent and distribution.

                  9.  Exercise of Option.  This option may be  exercised  by the
person then  entitled to do so as to any Shares which may then be purchased  (a)
by giving  written notice of exercise to the Secretary of the Company (or his or
her  designee),  specifying  the  number  of full  Shares  to be  purchased  and
accompanied  by full payment of the Exercise Price (and the amount of any income
tax the Company is required by law to withhold by reason of such exercise),  and
(b) by giving  satisfactory  assurances  in writing if requested by the Company,
signed by the person exercising the option, that the Shares to be purchased upon
such  exercise are being  purchased  for  investment  and not with a view to the
distribution thereof.

                  10. Suspension of  Exercisability.  If at any time the Company
shall  determine,  in  its  discretion,   that  the  listing,   registration  or
qualification  of the Shares upon any securities  exchange or under any state or
federal  law,  or  the  consent  or  approval  of  any  governmental  regulatory
authority,  is  necessary  or desirable as a condition of the purchase of Shares
hereunder,  this option may not be  exercised,  in whole or in part,  unless and
until such listing, registration,  qualification, consent or approval shall have
been effected or obtained free of any  conditions not acceptable to the Company.
The Company shall make reasonable  efforts to meet the  requirements of any such
state or federal law or  securities  exchange  and to obtain any such consent or
approval of any such governmental authority.

                  11. No Rights of  Stockholder.  Neither the Employee  (nor any
beneficiary)  shall be or have any of the rights or  privileges of a stockholder
of the Company in respect of any of the Shares issuable pursuant to the exercise
of this option,  unless and until  certificates  representing  such Shares shall
have been issued,  recorded on the records of the Company or its transfer agents
or registrars, and delivered to the Employee (or beneficiary).

                  12. No Effect on Employment.  The Employee's  employment  with
the Company and its  Affiliates  is on an at-will basis only.  Accordingly,  the
terms of the Employee's  employment with the Company and its Affiliates shall be
determined  from time to time by the  Company  or the  Affiliate  employing  the
Employee (as the case may be), and the Company or the  Affiliate  shall have the
right, which is hereby expressly  reserved,  to terminate or change the terms of
the  employment of the Employee at any time for any reason  whatsoever,  with or
without good cause.  For purposes of this Agreement,  the transfer of employment
of the Employee  between the Company and any one of its  Affiliates  (or between
Affiliates) shall not be deemed a Termination of Employment.

                  13. Address for Notices. Any notice to be given to the Company
under the terms of this Agreement shall be addressed to the Company,  in care of
its Secretary, at 600 Montgomery Street, San Francisco,  California 94111, or at
such other address as the Company may hereafter designate in writing.

                  14. Option is Not Transferable.  Except as otherwise  provided
in Paragraphs 7 and 8 above, this option and the rights and privileges conferred
hereby may not be transferred,  pledged,  assigned or otherwise  hypothecated in
any way (whether by operation of law or  otherwise)  and shall not be subject to
sale  under  execution,  attachment  or  similar  process.  Upon any  attempt to
transfer, pledge, assign, hypothecate or otherwise dispose of this option, or of
any right or privilege  conferred  hereby,  or upon any attempted sale under any
execution,  attachment  or  similar  process,  this  option  and the  rights and
privileges conferred hereby immediately shall become null and void.

                  15.  Maximum  Term  of  Option.   Notwithstanding   any  other
provision of this  Agreement  except  Paragraph 7 above relating to the death of
the Employee (in which case this option is  exercisable  to the extent set forth
therein), this option is not exercisable after the Expiration Date.

                  16.  Binding  Agreement.  Subject  to  the  limitation  on the
transferability of this option contained herein, this Agreement shall be binding
upon and inure to the  benefit of the heirs,  legatees,  legal  representatives,
successors and assigns of the parties hereto.

                  17. Conditions to Exercise. The Exercise Price for this option
must be paid in the legal  tender of the United  States  or, in the  Committee's
sole discretion,  in Shares. Exercise of this option will not be permitted until
satisfactory  arrangements  have been made for the  payment  of the  appropriate
amount of withholding taxes (as determined by the Company).

                  18.  Plan  Governs.  This  Agreement  is subject to all of the
terms and provisions of the Plan. In the event of a conflict between one or more
provisions  of this  Agreement  and  one or more  provisions  of the  Plan,  the
provisions of the Plan shall govern.  Capitalized terms and phrases used and not
defined in this Agreement shall have the meaning set forth in the Plan.

                  19.  Committee   Authority.   The  Committee  shall  have  all
discretion, power, and authority to interpret the Plan and this Agreement and to
adopt such rules for the  administration,  interpretation and application of the
Plan as are consistent therewith.  All actions taken and all interpretations and
determinations  made by the  Committee  in good faith shall be final and binding
upon the Employee,  the Company and all other interested  persons,  and shall be
given the maximum  deference  permitted by law. No member of the Committee shall
be personally  liable for any action,  determination or  interpretation  made in
good faith with respect to the Plan or this Agreement.

                  20. Captions. The captions provided herein are for convenience
only and are not to serve as a basis for the  interpretation  or construction of
this Agreement.

                  21.  Agreement  Severable.  In the event that any provision in
this Agreement shall be held invalid or  unenforceable,  such provision shall be
severable from, and such invalidity or  unenforceability  shall not be construed
to have any effect on, the remaining provisions of this Agreement.

                  22.   Modifications   to  this   Agreement.   This   Agreement
constitutes the entire understanding of the parties on the subjects covered. The
Employee  expressly  warrants that he or she is not executing  this Agreement in
reliance  on any  promises,  representations,  or  inducements  other than those
contained  herein.  Modifications to this Agreement or the Plan can be made only
in an express  written  contract  executed by a duly  authorized  officer of the
Company.