EXHIBIT 10.17

                        PHOENIX GOLD INTERNATIONAL, INC.

                                GRANT NO. NSO-10

                       NONSTATUTORY STOCK OPTION AGREEMENT

           THIS  AGREEMENT is made as of February 18, 1997 between  PHOENIX GOLD
INTERNATIONAL,  INC.,  an Oregon  corporation  (the  "Company"),  and MATTHEW W.
CHAPMAN (the "Optionee").

           Optionee has been  automatically  granted a nonstatutory stock option
to purchase  shares of the Company's  Common Stock,  without par value per share
(the "Common  Stock"),  in the amount  indicated  below.  This Option is granted
outside of the  Company's  Amended  and  Restated  1995 Stock  Option  Plan (the
"Plan").  Nonetheless,  certain  of the  terms  and  conditions  of the Plan are
incorporated into this Option Agreement by reference.

           NOW,  THEREFORE,  in  consideration  of the  promises  and the mutual
covenants contained in this Option Agreement, the parties agree as follows:

           1.  Grant.  The  Company  grants  to  Optionee,  upon the  terms  and
conditions  set forth  below,  the right and option (the  "Option")  to purchase
5,000  shares  of Common  Stock at an  exercise  price of $4.63  per share  (the
"Exercise Price"). The Option is a Nonstatutory Stock Option and is not intended
to qualify as an Incentive Stock Option under Section 422 of the Code.

           2. Term of Option. Subject to reductions in the term of the Option as
provided in this Option  Agreement,  the Option  shall  continue in effect until
February 18, 2007, and may be exercised during such term only in accordance with
the provisions of the Plan and this Option Agreement.

           3.  Vesting  Schedule.  The Option may be  exercised,  in whole or in
part, in accordance with the following schedule: (a) on the first anniversary of
the date  hereof,  one-third of the shares  purchasable  under the Option may be
purchased at any time thereafter until the Option expires; and (b) continuing on
each of the second and third  anniversaries  of the date hereof,  an  additional
one-third  of the shares  purchasable  under the Option may be  purchased at any
time thereafter until the Option expires.

           4.  Exercise of Option.

                A. Right to Exercise.  The Option is exercisable during its term
in  accordance  with the vesting  schedule  set forth above in Section 3 and the
applicable provisions of this Option Agreement. In the event that the Optionee's
service  with  the  Company  terminates  during  the  term  of the  Option,  the
exercisability  of the Option shall be governed by the applicable  provisions of
the Plan,  as if the Option had been  granted  under the Plan,  and this  Option
Agreement.

                B. Method of Exercise.  The Option is exercisable by delivery of
an  exercise  notice,  which  notice  shall state the  election to exercise  the
Option,  the number of shares of Common  Stock in respect of which the Option is
being exercised (the "Exercised  Shares"),  and such other  representations  and
agreements as may be required by the Company  pursuant to the  provisions of the
Plan.  In  addition,  Optionee  agrees  to  execute,  as a  condition  of Option
exercise,  such agreements respecting the Exercised Shares as the Committee,  in
its  reasonable  discretion,  determines  to be  required  under  the  terms  of
agreements  to which the Company is a party or  otherwise  advisable  and in the
best interests of the Company.  The exercise  notice shall be signed by Optionee
and shall be delivered in person or by  certified  mail to the  Secretary of the
Company.  The exercise  notice shall be  accompanied by payment of the aggregate
Exercise Price as to all the Exercised Shares.  The Option shall be deemed to be

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exercised  upon receipt by the Company of such fully  executed  exercise  notice
accompanied  by such  aggregate  Exercise  Price.  For income tax  purposes  the
Exercised  Shares shall be  considered  transferred  to Optionee on the date the
Option is exercised with respect to such Exercised Shares.

           5.  Conditions.  The  obligations  of the  Company  under this Option
Agreement shall be subject to the approval of such state or federal  authorities
or agencies as may have  jurisdiction  in the matter.  The Company  will use its
best  efforts to take such steps as may be  required  by state or federal law or
applicable  regulations,  including  rules and regulations of the Securities and
Exchange  Commission  and any national  securities  exchange on which the Common
Stock may then be listed,  in connection with the issuance or sale of any shares
acquired  pursuant to this Option Agreement or the listing of such shares on any
such exchange.  The Company shall not be obligated to issue or deliver shares of
Common Stock under this Option  Agreement if, upon advice of its legal  counsel,
such issuance or delivery would violate state or federal securities laws.

          6. Method of Payment. Payment of the aggregate Exercise Price shall be
by any of the following, or a combination thereof, at the election of Optionee:

              (i)  cash; or

             (ii)  check; or

            (iii) delivery of such documentation as the Committee and Optionee's
                  broker  shall  require to effect an exercise of the Option and
                  delivery to the  Company of the sale or margin  loan  proceeds
                  required to pay the aggregate  Exercise Price of the Exercised
                  Shares; or

            (iv)  surrender  of other  shares of Common  Stock which have a Fair
                  Market Value on the date of surrender  equal to the  aggregate
                  Exercise Price of the Exercised Shares.

           7. Restriction on Transfer.  The Option may not be transferred in any
manner otherwise than by will or by the laws of descent or distribution or, with
the consent of the Committee,  pursuant to a qualified  domestic relations order
(a "QDRO") as defined by the Code or Title I of the Employee  Retirement  Income
Security Act of 1974,  as amended,  and may be exercised  during the lifetime of
Optionee  only by Optionee or  Optionee's  guardian or legal  representative  or
Optionee's permitted assignee or transferee pursuant to a QDRO. The terms of the
Plan  and  this  Option   Agreement   shall  be  binding  upon  the   executors,
administrators, heirs, successors and permitted assigns of Optionee.

          8. Legends. All certificates  representing any of the shares of Common
Stock  subject to the  provisions  of this  Option  Agreement  may,  in the sole
discretion of the Committee, have endorsed thereon the following legends:

                           (a) "THESE  SECURITIES HAVE NOT BEEN REGISTERED UNDER
                  THE SECURITIES ACT OF 1933. THEY MAY NOT BE SOLD,  OFFERED FOR
                  SALE,  PLEDGED OR  HYPOTHECATED IN THE ABSENCE OF AN EFFECTIVE
                  REGISTRATION  STATEMENT AS TO THE SECURITIES UNDER SAID ACT OR
                  AN OPINION OF COUNSEL  SATISFACTORY  TO THE COMPANY  THAT SUCH
                  REGISTRATION IS NOT REQUIRED."

                           (b) Any  legend  required  to be  placed  thereon  by
                  applicable Blue Sky laws of any state.

                           (c) Any legend  required  to be placed  thereon by 
                  any  applicable  shareholder agreement.
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           9.  Employment;  Service.  Nothing  in the  Plan  or in  this  Option
Agreement  shall  (a)  confer  upon the  Optionee  any  right  with  respect  to
employment with the Company or any affiliate of the Company or (ii) interfere in
any way with  the  right of the  Company  or any  affiliate  of the  Company  to
terminate the  Optionee's  employment  (or service as a Director,  in accordance
with  applicable  corporate law, or service as a Consultant) at any time for any
reason, with or without cause.

          10. The Plan.  Although  the Option  has been  granted  outside of the
Plan,  the parties desire that the Option be subject to the terms and conditions
of the Plan as if it had been granted under the Plan.

          11.  Definitions.  Any capitalized term in this Option Agreement which
is not  defined  herein  and which is  defined  in the Plan  shall have the same
definition as in the Plan.

          12.  Governing  Law. To the extent that federal laws (such as the Code
and the federal  securities  laws) do not otherwise  control,  the Plan and this
Option  Agreement shall be construed in accordance with the laws of the state of
Oregon.

          13.  Headings.  Headings  contained in this Option  Agreement  are for
reference  purposes and shall not affect the meaning or  interpretation  of this
Option Agreement.

           Optionee and the Company  agree that the Option is granted  under and
governed  by the terms and  conditions  of the Plan and this  Option  Agreement.
Optionee has reviewed the Plan and this Option Agreement in their entirety,  has
had an  opportunity  to obtain  the advice of counsel  prior to  executing  this
Option  Agreement and fully  understands  all  provisions of the Plan and Option
Agreement. Optionee hereby agrees to accept as binding, conclusive and final all
decisions or interpretations of the Committee upon any questions relating to the
Plan and Option Agreement.

OPTIONEE:                               PHOENIX GOLD INTERNATIONAL, INC.



 /s/ Matthew W. Chapman                 By:    /s/ Kurt W. Ruttum
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Signature                               Kurt W. Ruttum
                                        Vice President and General Counsel

MATTHEW W. CHAPMAN
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