NEOPATH, INC.
                               
                    1989 STOCK OPTION PLAN
         As Amended and Restated on December 10, 1996

Section 1.  Purpose
     
     The purpose of the NeoPath, Inc. 1989 Stock Option Plan
(this "Plan") is to provide a means whereby selected
employees, directors, officers, agents, consultants, advisors
and independent contractors of NeoPath, Inc. (the "Company"),
or of any parent or subsidiary (as defined in subsection 5.8
and referred to hereinafter as "related corporations")
thereof, may be granted incentive stock options and/or
nonqualified stock options to purchase the Common Stock (as
defined in Section 3) of the Company, in order to attract and
retain the services or advice of such employees, directors,
officers, agents, consultants, advisors and independent
contractors and to provide added incentive to such persons by
encouraging stock ownership in the Company.

Section 2.  Administration
     
     This Plan shall be administered by the Board of Directors
of the Company (the "Board") or a committee or committees
(which term includes subcommittees) appointed by, and
consisting of two or more members of, the Board.  The
administrator of this Plan shall hereinafter be referred to as
the "Plan Administrator."  So long as the Company's common
stock (the "Common Stock") is registered under Section 12(b)
or 12(g) of the Securities Exchange Act of 1934, as amended
(the "Exchange Act"), the Board shall consider, in selecting
the Plan Administrator and the membership of any committee
acting as Plan Administrator of this Plan with respect to any
persons subject or likely  to become subject to Section 16
under the Exchange Act, the provisions regarding (a) "outside
directors," as contemplated by Section 162(m) of the Internal
Revenue Code of 1986, as amended (the "Code"), and (b)
"nonemployee directors," as contemplated by Rule 16b-3 under
the Exchange Act.  The Board may delegate the responsibility
for administering this Plan with respect to designated classes
of eligible participants to different committees, subject to
such limitations as the Board deems appropriate.
     
     The members of any committee serving as Plan
Administrator shall be appointed by the Board for such term as
the Board may determine.  The Board may
from time to time remove members from, or add members to, the committee.
Vacancies on the committee, however caused, shall be filled by
the Board.

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     2.1  Procedures
     
     The Board shall designate one of the members of the Plan
Administrator as chairman.  The Plan Administrator may hold
meetings at such times and places as it shall determine.  The
acts of a majority of the members of the Plan Administrator
present at meetings at which a quorum exists, or acts reduced
to or approved in writing by all Plan Administrator members,
shall be valid acts of the Plan Administrator.
     
     2.2  Responsibilities
     
     Except for the terms and conditions explicitly set forth
in this Plan, the Plan Administrator shall have the authority,
in its discretion, to determine all matters relating to the
options to be granted under this Plan, including selection of
the individuals to be granted options, the number of shares to
be subject to each option, the exercise price, and all other
terms and conditions of the options.  Grants under this Plan
need not be identical in any respect, even when made
simultaneously.  The interpretation and construction by the
Plan Administrator of any terms or provisions of this Plan or
any option issued hereunder, or of any rule or regulation
promulgated in connection herewith, shall be conclusive and
binding on all interested parties, so long as such
interpretation and construction with respect to incentive
stock options correspond to the requirements of Section 422 of
the Code, the regulations thereunder and any amendments
thereto.
     
     2.3  Rule 16b-3 Compliance and Bifurcation of Plan
     
     Notwithstanding anything in this Plan to the contrary,
the Board, in its absolute discretion, may bifurcate this Plan
so as to restrict, limit or condition the application of any
provision of this Plan to participants who are subject to
Section 16 of the Exchange Act without so restricting,
limiting or conditioning this Plan with respect to other
participants.
     
     Section 3.  Shares Subject to This Plan
     
     The shares subject to this Plan shall be the  Common
Stock, currently authorized but unissued or subsequently
acquired by the Company.  Subject to adjustment as provided in
Section 7, the aggregate amount of Common Stock to be
delivered upon the exercise of all options granted under this
Plan shall not exceed 2,750,000 shares.  If any option granted
under this Plan shall expire or be surrendered,
exchanged for another option, canceled or terminated for any reason without
having been exercised in full, the unpurchased shares subject
thereto shall thereupon again be available for purposes of
this Plan, including for replacement options which may be

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granted in exchange for such expired, surrendered, exchanged,
canceled or terminated options.
     
     Section 4.  Eligibility
     
     An incentive stock option may be granted only to an
individual who, at the time the option is granted, is an
employee of the Company or a related corporation.  A
nonqualified stock option may be granted to any employee,
director, officer, agent, consultant, advisor or independent
contractor of the Company or any related corporation, whether
an individual or an entity.  Any party to whom an option is
granted under this Plan shall be referred to hereinafter as an
"Optionee."

Section 5.  Terms and Conditions of Options
     
     Options granted under this Plan shall be evidenced by
written agreements which shall contain such terms, conditions,
limitations and restrictions as the Plan Administrator shall
deem advisable and which are not inconsistent with this Plan.
Notwithstanding the foregoing, options shall include or
incorporate by reference the following terms and conditions:
     
     5.1  Number of Shares and Price
     
     The maximum number of shares that may be purchased
pursuant to the exercise of each option and the price per
share at which such option is exercisable (the "exercise
price") shall be as established by the Plan Administrator;
provided, however, that the maximum number of shares with
respect to which an option or options may be granted to any
Optionee in any one fiscal year of the Company shall not
exceed 400,000 shares (the "Maximum Annual Optionee Grant").
The Plan Administrator shall act in good faith to establish an
exercise price which shall be not less than the fair market
value per share of the Common Stock at the time the option is
granted with respect to incentive stock options and also
provided that, with respect to incentive stock options granted
to greater than 10% shareholders, the exercise price shall be
as required by subsection 6.1.
     
     5.2  Term and Maturity
     
     Subject to the restrictions contained in Section 6 with
respect to granting incentive stock options to greater than
10% shareholders, the term of each incentive stock option
shall be as established by the Plan Administrator and, if not so
established, shall be 10 years from the date it is granted
but in no event shall it exceed 10 years.  The term of each
nonqualified stock option shall be as established by the Plan
Administrator and, if not so established, shall be 10 years.
To ensure that the Company or a related corporation will
achieve the purpose and receive the benefits 

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contemplated by
this Plan, any option granted to any Optionee hereunder shall,
unless the condition of this sentence is waived or modified in
the agreement evidencing the option or by resolution adopted
at any time by the Plan Administrator, be exercisable
according to the following schedule:

For options granted prior to December 10, 1996
                                          
   Period of Optionee's                   
  Continuous Relationship                 
With the Company or Related    Portion of Total Option
 Corporation From the Date      Which Is Exercisable
   the Option Is Granted
---------------------------   ------------------------
       after 1 year                      25%
  
 each month completed         an additional 1/36th
        thereafter              of the remaining 75%

       after 4 years                    100%

For options granted after December 9, 1996:
                                          
   Period of Optionee's                   
  Continuous Relationship                 
With the Company or Related    Portion of Total Option
 Corporation From the Date      Which Is Exercisable
   the Option Is Granted
---------------------------    -----------------------
       after 1 year*                     25%

    each year completed          
        thereafter                an additional 25%

       after 4 years                    100%
________________
*For options granted to new employees, the period shall be
from grant date to 1 year after date of employment
     
     5.3  Exercise
     
     Subject to the vesting schedule described in
subsection 5.2, each option may be exercised in whole or in
part at any time and from time to time; provided, however,
that only whole shares will be issued pursuant to the exercise
of any option.  An
Option shall be exercised by delivery to
the Company of notice of the number of shares with respect to
which the option is exercised, together with payment of the
exercise price.

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     5.4  Payment of Exercise Price
     
     Payment of the option exercise price shall be made in
full at the time the notice of exercise of the option is
delivered to the Company and shall be in cash, bank certified
or cashier's check, or personal check (unless at the time of
exercise the Plan Administrator in a particular case
determines not to accept a personal check) for the shares
being purchased.
     
     The Plan Administrator can determine at any time before
exercise that additional forms of payment will be permitted.
To the extent permitted by applicable laws and regulations
(including, but not limited to, federal tax and securities
laws and regulations and state corporate law), and unless the
Plan Administrator in its sole discretion determines
otherwise, an option may be exercised by a combination of cash
and/or check and one or both of the following additional
forms:
     
          (a)  tendering (either actually or by attestation)
shares of Common Stock of the Company held by an Optionee
having a fair market value equal to the exercise price, such
fair market value to be determined in good faith by the Plan
Administrator; provided, however, that payment in stock held
by an Optionee shall not be made unless the stock shall have
been owned by the Optionee for a period of at least six months
(or any shorter period necessary to avoid a charge to the
Company's earnings for financial accounting purposes); or
     
          (b)  delivery of a properly executed exercise
notice, together with irrevocable instructions to a broker,
all in accordance with the regulations of the Federal Reserve
Board, to promptly deliver to the Company the amount of sale
or loan proceeds to pay the exercise price and any federal,
state or local withholding tax obligations that may arise in
connection with the exercise.
     
     In addition, the exercise price for shares purchased
under an option may be paid, either singly or in combination
with one or more of the alternative forms of payment
authorized by this Section 5.4, by (y) delivery of a full-
recourse promissory note executed by the Optionee; provided
that (i) such note delivered in connection with an incentive
stock option shall, and such note delivered in connection with
a nonqualified stock option may, in the sole discretion of the
Plan Administrator, bear interest at a rate specified by the
Plan Administrator but in no case less than the rate required
to avoid imputation of interest (taking into account any
exceptions to the imputed interest rules) for federal income
tax purposes, (ii) the Plan Administrator in
its sole discretion shall specify the term and other provisions of such
note at the time an incentive stock option is granted or at
any time prior to exercise of a nonqualified stock option,
(iii) the Plan Administrator may require that the Optionee
pledge to the Company for the purpose of securing the payment
of such note the shares of Common

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Stock to be issued to the
Optionee upon exercise of the option and may require that the
certificate representing such shares be held in escrow in
order to perfect the Company's security interest, and (iv) the
Plan Administrator in its sole discretion may at any time
restrict or rescind this right upon notification to the
Optionee; or (z) such other consideration as the Plan
Administrator may permit.
     
     5.5  Withholding Tax Requirement
     
     At its discretion, the Company may require an Optionee
receiving shares of Common Stock to reimburse the Company for
any taxes required by any government to be withheld by the
Company or otherwise deducted and paid with respect to an
option, and may withhold any distribution in whole or in part
until the Company is so reimbursed.  In lieu thereof, the
Company shall have the right to withhold from any cash or
other amounts due or to become due from the Company to the
Optionee an amount equal to such taxes.  The Company may also
retain and withhold or the Optionee may elect, unless the Plan
Administrator determines otherwise, to have the Company retain
and withhold a number of shares having a market value not less
than the amount of such taxes required to be withheld by the
Company to reimburse the Company for any such taxes and cancel
(in whole or in part) any such shares so withheld.
     
     5.6  Holding Periods
          
          5.6.1  Securities and Exchange Act Section 16
     
     If an individual subject to Section 16 of the Exchange
Act sells shares of Common Stock obtained upon the exercise of
a stock option within six months after the date the option was
granted, such sale may result in short-swing profit liability
under Section 16(b) of the Exchange Act.
          
          5.6.2  Taxation of Stock Options
     
     In order to obtain certain tax benefits afforded to
incentive stock options under Section 422 of the Code, an
Optionee must hold the shares issued upon the exercise of an
incentive stock option for two years after the date of grant
of the option and one year from the date of exercise.  An
Optionee may be subject to the alternative minimum tax at the
time of exercise of an incentive stock option.

     The Plan Administrator may require an Optionee to give
the Company prompt notice of any disposition of shares
acquired by the exercise of an incentive stock option prior to
the expiration of such holding periods.

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     Tax advice should be obtained by an Optionee when
exercising any option and prior to the disposition of the
shares issued upon the exercise of any option.
     
     5.7  Transferability of Options
     
     Options granted under this Plan and the rights and
privileges conferred hereby may not be transferred, assigned,
pledged or hypothecated in any manner (whether by operation of
law or otherwise) other than by will or by the applicable laws
of descent and distribution and shall not be subject to
execution, attachment or similar process.  During an
Optionee's lifetime, any options granted under this Plan are
personal to him or her and are exercisable solely by such
Optionee or a permitted assignee or transferee of such
Optionee (as provided below).  Any attempt to transfer,
assign, pledge, hypothecate or otherwise dispose of any option
under this Plan or of any right or privilege conferred hereby,
contrary to the Code or to the provisions of this Plan, or the
sale or levy or any attachment or similar process upon the
rights and privileges conferred hereby shall be null and void.
Notwithstanding the foregoing, to the extent permitted by
Section 422 of the Code, the Plan Administrator may permit an
Optionee to (i) during the Optionee's lifetime, designate a
person who may exercise the option after the Optionee's death
by giving written notice of such designation to the Company
(such designation may be changed from time to time by the
Optionee by giving written notice to the Company revoking any
earlier designation and making a new designation) or
(ii) transfer the option and the rights and privileges
conferred hereby; provided, however, that any option so
assigned or transferred shall be subject to all the same terms
and conditions contained in the instrument evidencing the
award.
     
     5.8  Termination of Relationship
     
     If the Optionee's relationship with the Company or any
related corporation ceases for any reason, then the portion of
the Optionee's option that is not exercisable at the time of
such cessation shall terminate immediately upon such
cessation, unless the Plan Administrator determines otherwise.
If the Optionee's relationship with the Company or any related
corporation ceases for any reason other than termination for
cause, death or total disability, and unless by its terms the
option sooner terminates or expires, then the Optionee may
exercise, for a three-month period, that portion of the
Optionee's option which is exercisable at the time of such
cessation, but the Optionee's option shall terminate at the
end of such period following such cessation as to all shares
for which it has not theretofore been exercised, unless such
provision is waived in the agreement evidencing the option, or
at any time prior to the expiration of the option, by the Plan
Administrator in its sole discretion.  If, however, in the
case of an incentive stock option, the Optionee does not
exercise the Optionee's option within three months after
cessation of employment, the option will no longer qualify as
an incentive stock option under the Code.

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     If an Optionee is terminated for cause, each option
granted hereunder shall automatically terminate as of the
first discovery by the Company of any reason for termination
for cause, and such Optionee shall thereupon have no right to
purchase any shares pursuant to such option.  "Termination for
cause" shall mean dismissal for dishonesty, conviction or
confession of a crime (except minor violations), fraud,
misconduct or disclosure of confidential information.  If an
Optionee's relationship with the Company or any related
corporation is suspended pending an investigation of whether
or not the Optionee shall be terminated for cause, the
Optionee's rights under each option granted hereunder likewise
shall be suspended during the period of investigation.
     
     If an Optionee's relationship with the Company or any
related corporation ceases because of a total disability, the
portion of the Optionee's option that is exercisable at the
time of such cessation shall not terminate or, in the case of
an incentive stock option, cease to be treated as an incentive
stock option until the end of the 12-month period following
such cessation (unless by its terms it sooner terminates or
expires).  As used in this Plan, the term "total disability"
refers to a mental or physical impairment of the Optionee
which is expected to result in death or which has lasted or is
expected to last for a continuous period of 12 months or more
and which causes the Optionee to be unable, in the opinion of
the Company and two independent physicians, to perform his or
her duties for the Company and to be engaged in any
substantial gainful activity.  Total disability shall be
deemed to have occurred on the first day after the Company and
the two independent physicians have furnished their opinion of
total disability to the Plan Administrator.
     
     The Plan Administrator, in its absolute discretion, may
determine all questions of whether particular leaves of
absence constitute a termination of services; provided,
however, that with respect to incentive stock options, such
determination shall be subject to any requirements contained
in the Code.  The foregoing notwithstanding, with respect to
incentive stock options, employment shall not be deemed to
continue beyond the first 90 days of such leave, unless the
Optionee's reemployment rights are guaranteed by statute or by
contract.
     
     As used herein, the term "related corporation," when
referring to a subsidiary corporation, shall mean any
corporation (other than the Company) in, at the time of
the granting of the option, an unbroken chain of corporations
ending with the Company, if stock possessing 50% or more of
the total combined voting power of all classes of stock of
each of the corporations other than the Company is owned by
one of the other corporations in such chain.  When referring
to a parent corporation, the term "related corporation" shall
mean any corporation in an unbroken chain of corporations
ending with the Company if, at the time of the granting of the
option, each of the corporations other than the Company owns
stock possessing 50% or more 

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of the total combined voting
power of all classes of stock in one of the other corporations
in such chain.
     
     5.9  Death of Optionee
     
     If an Optionee dies while he or she has a relationship
with the Company or any related corporation or within the
three-month period (or 12-month period in the case of totally
disabled Optionees) following cessation of such relationship,
any option held by such Optionee to the extent that the
Optionee would have been entitled to exercise such option, may
be exercised within one year after his or her death by the
personal representative of his or her estate or by the person
or persons to whom the Optionee's rights under the option
shall pass (i) by will or by the applicable laws of descent
and distribution or (ii) by a designation or transfer pursuant
to Section 5.7.
     
     5.10 No Status as Shareholder
     
     Neither the Optionee nor any party to which the
Optionee's rights and privileges under the option may pass
shall be, or have any of the rights or privileges of, a
shareholder of the Company with respect to any of the shares
issuable upon the exercise of any option granted under this
Plan unless and until such option has been exercised.
     
     5.11 Continuation of Relationship
     
     Nothing in this Plan or in any option shall confer upon
any Optionee any right to continue in the employ or other
relationship of the Company or of a related corporation, or to
interfere in any way with the right of the Company or of any
such related corporation to terminate his or her employment or
other relationship with the Company at any time.
     
     5.12 Modification and Amendment of Option
     
     Subject to the requirements of Code Section 422 with
respect to incentive stock options and to the terms and
conditions and within the limitations of this Plan, the Plan
Administrator may modify or amend any outstanding option
granted under this Plan.  The modification or amendment of an
outstanding option shall not, without the consent of the
Optionee, impair or diminish any of his or her rights or any
of the obligations of the Company under such option.  Except
as otherwise provided in this Plan, no outstanding option
shall be terminated without the consent of the Optionee.
     
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     5.13 Limitation on Value for Incentive Stock Options
     
     As to all incentive stock options granted under the terms
of this Plan, to the extent that the aggregate fair market
value of the shares (determined at the time the incentive
stock option is granted) with respect to which incentive stock
options are exercisable for the first time by the Optionee
during any calendar year (under this Plan and all other
incentive stock option plans of the Company, a related
corporation or a predecessor corporation) exceeds $100,000,
such options shall be treated as nonqualified stock options.
The previous sentence shall not apply if the Internal Revenue
Service issues a public rule, issues a private ruling to the
Company, any Optionee or any legatee, personal representative
or distributee of an Optionee or issues regulations changing
or eliminating such annual limit.

Section 6.  Greater Than 10% Shareholders
     
     6.1  Exercise Price and Term of Incentive Stock
          Options
     
     If an incentive stock option is granted under this Plan
to any employee who owns more than 10% of the total combined
voting power of all classes of stock of the Company or any
related corporation, the term of such incentive stock options
shall not exceed five years and the exercise price shall be
not less than 110% of the fair market value of the shares at
the time the incentive stock option is granted.  This
provision shall control notwithstanding any contrary terms
contained in an option agreement or any other document.
     
     6.2  Attribution Rule
     
     For purposes of subsection 6.1, in determining stock
ownership, an employee shall be deemed to own the shares
owned, directly or indirectly, by or for his or her brothers,
sisters, spouse, ancestors and lineal descendants.  Shares
owned, directly or indirectly, by or for a corporation,
partnership, estate or trust shall be deemed to be owned
proportionately by or for its shareholders, partners or
beneficiaries.  If an employee or a person related to the
employee owns an unexercised option or warrant to purchase
shares of the Company, the shares subject to that portion of
the option or warrant which is unexercised shall not be
counted in determining stock ownership.  For purposes of this
Section 6, shares owned by an employee shall include all shares
actually issued and outstanding immediately before the
grant of the incentive stock option to the employee.

Section 7.  Adjustments Upon Changes in Capitalization
     
     The aggregate number and class of shares for which
options may be granted under this Plan, the Maximum Annual
Optionee Grant set forth in Section 5.1, the

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number and class
of shares covered by each outstanding option and the exercise
price per share thereof (but not the total price), shall all
be proportionately adjusted for any increase or decrease in
the number of issued shares of Common Stock of the Company
resulting from a split-up or consolidation of shares or any
like capital adjustment, or the payment of any stock dividend.
     
     7.1  Effect of Liquidation or Reorganization
     
          7.1.1  Cash, Stock or Other Property for Stock
     
     Except as provided in subsection 7.1.2, upon a merger
(other than a merger of the Company in which the holders of
shares of Common Stock immediately prior to the merger have
the same proportionate ownership of shares of Common Stock in
the surviving corporation immediately after the merger),
consolidation, acquisition of property or stock, separation,
reorganization (other than a mere reincorporation or the
creation of a holding company) or liquidation of the Company,
as a result of which the shareholders of the Company receive
cash, stock or other property in exchange for or in connection
with their shares of Common Stock, any option granted
hereunder shall terminate, but the Optionee shall have the
right immediately prior to any such merger, consolidation,
acquisition of property or stock, separation, reorganization
or liquidation to exercise such Optionee's option in whole or
in part whether or not the vesting requirements set forth in
the option agreement have been satisfied.
     
          7.1.2  Conversion of Options on Stock for Stock
          Exchange
     
     If the shareholders of the Company receive capital stock
of another corporation ("Exchange Stock") in exchange for
their shares of Common Stock in any transaction involving a
merger (other than a merger of the Company in which the
holders of Common Stock immediately prior to the merger have
the same proportionate ownership of Common Stock in the
surviving corporation immediately after the merger),
consolidation, acquisition of property or stock, separation or
reorganization (other than a mere reincorporation or the
creation of a holding company), all options granted hereunder
shall be converted into options to purchase shares of Exchange
Stock unless the Company and the corporation issuing the
Exchange Stock, in their sole discretion, determine that any
or all such options granted hereunder shall not be
converted into options to purchase shares of Exchange Stock but instead
shall terminate in accordance with the provisions of
subsection 7.1.1.  The amount and price of converted options
shall be determined by adjusting the amount and price of the
options granted hereunder in the same proportion as used for
determining the number of shares of Exchange Stock the holders
of the shares of Common Stock receive in such merger,
consolidation, acquisition of property or stock, separation or
reorganization.  The converted options shall be fully vested
whether or not the vesting

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requirements set forth in the
option agreement have been satisfied provided that such
acceleration will not occur if, in the opinion of the
Company's outside accountants, such acceleration would render
unavailable "pooling of interests" accounting treatment for
any reorganization, merger or consolidation of the Company for
which pooling of interests accounting treatment is sought by
the Company.
     
     Upon a merger of the Company in which the holders of
Common Stock immediately prior to the merger have the same
proportionate ownership of common stock in the surviving
corporation immediately after the merger, a mere
reincorporation or the creation of a holding company, each
option outstanding under this Plan shall be assumed or an
equivalent option shall be substituted by the successor
corporation or a parent or subsidiary of such corporation, and
the vesting schedule set forth in the instrument evidencing
the option shall continue to apply to such assumed or
equivalent option.
     
     7.2  Fractional Shares
     
     In the event of any adjustment in the number of shares
covered by any option, any fractional shares resulting from
such adjustment shall be disregarded and each such option
shall cover only the number of full shares resulting from such
adjustment.
     
     7.3  Determination of Board to Be Final
     
     All Section 7 adjustments shall be made by the Board, and
its determination as to what adjustments shall be made, and
the extent thereof, shall be final, binding and conclusive.
Unless an Optionee agrees otherwise, any change or adjustment
to an incentive stock option shall be made in such a manner so
as not to constitute a "modification" as defined in Code
Section 425(h) and so as not to cause his or her incentive
stock option issued hereunder to fail to continue to qualify
as an incentive stock option as defined in Code
Section 422(b).

Section 8.  Securities Regulation
     
     Shares shall not be issued with respect to an option
granted under this Plan unless the exercise of such option and
the issuance and delivery of such shares 
pursuant thereto shall comply with all relevant provisions of law, including,
without limitation, any applicable state securities laws, the
Securities Act of 1933, as amended, the Exchange Act, the
rules and regulations promulgated thereunder, and the
requirements of any stock exchange upon which the shares may
then be listed, and shall be further subject to the approval
of counsel for the Company with respect to such compliance,
including the availability, if applicable, of an exemption
from registration for the issuance and sale of any shares
hereunder.  Inability of the

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Company to obtain, from any
regulatory body having jurisdiction, the authority deemed by
the Company's counsel to be necessary for the lawful issuance
and sale of any shares hereunder or the unavailability of an
exemption from registration for the issuance and sale of any
shares hereunder shall relieve the Company of any liability in
respect of the nonissuance or sale of such shares as to which
such requisite authority shall not have been obtained.
     
     As a condition to the exercise of an option, the Company
may require the Optionee to represent and warrant at the time
of any such exercise that the shares are being purchased only
for investment and without any present intention to sell or
distribute such shares if, in the opinion of counsel for the
Company, such a representation is required by any relevant
provision of the aforementioned laws.  At the option of the
Company, a stop-transfer order against any shares of stock may
be placed on the official stock books and records of the
Company, and a legend indicating that the stock may not be
pledged, sold or otherwise transferred, unless an opinion of
counsel is provided (concurred in by counsel for the Company)
stating that such transfer is not in violation of any
applicable law or regulation, may be stamped on stock
certificates in order to assure exemption from registration.
The Plan Administrator may also require such other action or
agreement by the Optionees as may from time to time be
necessary to comply with the federal and state securities
laws.  THIS PROVISION SHALL NOT OBLIGATE THE COMPANY TO
UNDERTAKE REGISTRATION OF THE OPTIONS OR STOCK HEREUNDER.
     
     Should any of the Company's capital stock of the same
class as the stock subject to options granted hereunder be
listed on a national securities exchange, all stock issued
hereunder if not previously listed on such exchange shall be
authorized by that exchange for listing thereon prior to the
issuance thereof.

Section 9.  Amendment and Termination
     
     9.1  Board Action
     
     The Board may at any time suspend, amend or terminate
this Plan, provided that, to the extent required for
compliance with Section 422 of the Code or by any 
applicable law or regulation, the Company's shareholders must approve any
amendment which will:
     
          (a)  increase the total number of shares that may be
issued under this Plan;
     
          (b)  modify the class of participants eligible for
participation in this Plan; or

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          (c)  otherwise require shareholder approval under
any applicable law or regulation.
     
     Such shareholder approval must be obtained (i) within
12 months of the adoption by the Board of such amendment.
     
     Any amendment made to this Plan since its original
adoption which would constitute a "modification" to incentive
stock options outstanding on the date of such amendment, shall
not be applicable to such outstanding incentive stock options,
but shall have prospective effect only, unless the Optionee
agrees otherwise.
     
     9.2  Automatic Termination
     
     Unless sooner terminated by the Board, this Plan shall
terminate ten years from the earlier of (a) the date on which
this Plan is adopted by the Board or (b) the date on which
this Plan is approved by the shareholders of the Company.  No
option may be granted after such termination or during any
suspension of this Plan.  The amendment or termination of this
Plan shall not, without the consent of the option holder,
alter or impair any rights or obligations under any option
theretofore granted under this Plan.

Section 10.  Effectiveness of This Plan
     
     This Plan shall become effective upon adoption by the
Board so long as it is approved by the Company's shareholders
at any time within 12 months of such adoption of this Plan or,
if earlier, and to the extent required for compliance with
Rule 16b-3 under the Exchange Act, at the next annual meeting
of shareholders after adoption by the Board.
     
     Original Plan adopted by the Board on May 23, 1989 and
approved by the shareholders on May 30, 1989.  Plan was
amended on March 15, 1991, July 15, 1991, and November 18,
1991.  Plan amended and restated on March 27, 1992, on
January 22, 1993 and on August 19, 1993; restated by the Board
on October 26, 1994 and approved by the shareholders on
November 17, 1994; amended and restated by 
the Board on April 25, 1996 and approved by the Company's shareholders on
June 25, 1996.  Amended and restated by the Board on
December 10, 1996.

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