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                                                                  EXHIBIT 10.1.2



                                    RESTATED
                               TELXON CORPORATION
                             1990 STOCK OPTION PLAN
                        AS AMENDED THROUGH AND EFFECTIVE
                             AS OF JANUARY 18, 2000



         1.    PURPOSE OF THE PLAN. The purpose of this Plan is to promote the
best interests of the Company and its stockholders by enabling the Company to
attract and retain highly qualified personnel through rewarding valued employees
with the opportunity, pursuant to Options granted under the Plan, to acquire a
proprietary interest in the Company and thereby encourage them to put forth
their maximum efforts for the continued success and growth of the Company.

         2.    DEFINITIONS. In addition to such other capitalized terms as are
defined elsewhere in this Plan, the following terms shall when used in this Plan
have the respective meanings set forth below:

               (a) "Act" means the Securities Exchange Act of 1934, as amended
          from time to time.

               (b) "Authorized Shares" means the maximum aggregate number of
          shares of Common Stock specified in Section 3(a) as being authorized
          for issuance and sale under Options granted pursuant to the Plan,
          subject to adjustment thereof in accordance with Section 12 of the
          Plan.

               (c) "Board" means the Board of Directors of the Company.

               (d) "Code" means the Internal Revenue Code of 1986, as amended
          from time to time.

               (e) "Commission" means the United States Securities and Exchange
          Commission.

               (f) "Committee" means the Committee appointed by the Board in
          accordance with Paragraph (a) of Section 4 of the Plan, if a Committee
          is appointed. If, with respect to any individual grant of Options
          under this Plan, any member or members of the Committee would cause
          such Committee not to satisfy the disinterested administration
          requirement of Rule 16b-3, as then applicable to the Company under the
          Act, or the "outside director" administration requirement of Code
          Section 162(m)(4)(C) and the regulations thereunder, then in such
          event the Committee shall be comprised of the

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          Committee without such member or members. If no Committee has been
          appointed, any reference to the "Committee" shall be deemed a
          reference to the "Board".

               (g) "Common Stock" means the Common Stock, par value $.01 per
          share, of the Company.

               (h) "Company" means Telxon Corporation, a Delaware corporation.

               (i) "Continuous Employment" means with respect to any Employee,
          the continued employment of such Employee by the Company or any
          Subsidiary without interruption or termination after the grant of an
          Option to such Employee. Continuous Employment shall not be considered
          interrupted in the case of sick leave, military leave or any other
          leave of absence approved by the Board (provided that such leave is
          for a period of not more than ninety (90) days or re-employment upon
          the expiration of such leave is mandated by contract or statute) or in
          the case of transfers between locations of the Company or between the
          Company, any Subsidiary or any of their respective successors.

               (j) "Employee" means any person, including officers and directors
          who are also officers, employed by the Company or any Subsidiary. The
          payment of director's fees by the Company shall not be sufficient to
          constitute a person as an "Employee" of the Company.

               (k) "Family Member" means (i) the Optionee to whom an Option is
          granted under the Plan, the spouse or any sibling of the Optionee or
          any ancestor or lineal descendant (including, but not limited to,
          adopted and step children) of the Optionee or his or her spouse or
          sibling(s), (ii) a trust for the exclusive benefit of the Optionee
          and/or person(s) described in clause (i) of this Section 2(k), or the
          trustee of such a trust in his, her or its capacity as such, (iii) a
          partnership, corporation, limited liability company or similar entity
          the partners, stockholders or other owners of which include only the
          Optionee and/or person(s) described in clause (i) of this Section
          2(k).

               (l) "Non-Profit Organization" means any organization which is
          exempt from United States income taxes under Section 501(c)(3), (4),
          (5), (6), (7), (8) or (10) of the Code.

               (m) "Option" means a right granted to an Employee pursuant to the
          Plan to purchase a specified number of shares of Common Stock at a
          specified price during a specified period and on such other terms and
          conditions as may be specified pursuant to the Plan. Options may be
          granted as Tax Qualified Options or as Options which do not qualify as
          Tax Qualified Options.

               (o) "Option Agreement" means the written agreement evidencing an
          Option by and between the Company and the Optionee as required by
          Section 14.

               (p) "Optioned Stock" means the Common Stock subject to an Option.


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               (q) "Optionee" means an Employee who receives an Option.

               (r) "Plan" means this 1990 Stock Option Plan, as amended from
          time to time.

               (s) "Predecessor Plan" means the Company's 1988 Stock Option
          Plan, as amended.

               (t) "Repricing Transaction" means any grant(s) of Option(s)
          reasonably related to any prior or potential Option(s), whether by an
          exchange of existing Options or Options with new terms or the grant of
          new Options in tandem with previously granted Options that will
          operate to cancel the previously granted Options upon exercise, which
          adjusts or amends the exercise price of a previously granted Option,
          or repricing of previously granted Options or any other grant which
          would be required to be reported as a repricing under Item 402(i) of
          Regulation S-K as then in effect under the Act; but excluding any
          repricing occurring through the operation of the antidilution
          provisions of Section 12 of the Plan.

               (u) "Rule 16b-3" means Rule 16b-3 promulgated by the Commission
          under the Act or any similar successor regulation exempting certain
          transactions involving stock-based compensation arrangements from the
          liability provisions of Section 16 of the Act, as adopted and amended
          from time to time and as interpreted by formal or informal opinions
          of, and releases published or other interpretive advice provided by,
          the Staff of the Commission.

               (v) "Section 16 Person" means an Employee who is subject to
          Section 16 of the Act, as interpreted by the rules and regulations
          promulgated by the Commission thereunder, as adopted and amended from
          time to time, and by formal or informal opinions of, and releases
          published or other interpretive advice provided by, the Staff of the
          Commission.

               (w) "Securities Law Requirements" means the Act and the rules and
          regulations promulgated by the Commission thereunder, as adopted and
          amended from time to time, including but not limited to Rule 16b-3,
          and as interpreted by formal or informal opinions of, and releases
          published or other interpretive advice provided by, the Staff of the
          Commission, and the requirements of any stock exchange, automated
          interdealer quotation system or other recognized securities market on
          which the Common Stock is listed or traded or in which the Common
          Stock is included, as adopted and amended from time to time and as
          interpreted by formal or informal opinions of, and other interpretive
          advice, provided by the representatives of such stock exchange,
          quotation system or other securities market.

               (x) "Shares" means the Common Stock as adjusted in accordance
          with Section 12 of the Plan.


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               (y) "Subsidiary" means a corporation of which not less than fifty
          percent (50%) of the voting shares are owned by the Company or a
          Subsidiary, whether or not such corporation now exists or is hereafter
          organized or acquired by the Company or a Subsidiary.

               (z) "Successor" means the estate of an Optionee or a person who
          succeeds by will or the laws of descent and distribution, or by a
          transfer made pursuant to Section 11(a)(1)(B) or 11(a)(1)(C), to an
          Optionee's right to exercise an Option, including but not limited to a
          person succeeding by will or the laws of descent and distribution to a
          prior Successor's right to exercise an Option.

               (aa) "Tax Qualified Option" means an Option which is intended at
          the time of grant to qualify for special tax treatment under Section
          422A or other particular provisions of the Code and the regulations,
          rulings and procedures promulgated, published or otherwise provided
          thereunder, as adopted and amended from time to time.

          3.   STOCK SUBJECT TO THE PLAN.

               (a)  Number of Shares Issuable. Subject to adjustment in
          accordance with the provisions of Section 12 of the Plan, the maximum
          aggregate number of Authorized Shares which may be issued and sold
          under Options granted pursuant to the Plan is equal to the sum of the
          following:

                    (i) Pre-1995 Authorized Shares. 2,500,000 shares of Common
               Stock, plus such number of the 1,200,000 shares of Common Stock
               authorized for issuance and sale under the Predecessor Plan which
               (A) as of the October 18, 1990 date this Plan was originally
               approved by the stockholders of the Company, were not subject to
               grants (including conditional grants) of stock options then
               outstanding under the Predecessor Plan (from and after
               stockholder approval of this Plan, no further grants shall be
               made under the Predecessor Plan, but any grants (including
               conditional grants) of stock options outstanding under the
               Predecessor Plan at the time of such approval shall continue in
               full force and effect in accordance with their respective terms)
               or (B) to the extent grants (including conditional grants)
               outstanding under the Predecessor Plan as of the date of original
               stockholder approval of this Plan are not exercised in full, are,
               as of any subsequent date, (x) issued pursuant to the exercise of
               a stock option granted under the Predecessor Plan in an amount
               equal to the number of Shares already owned by the person
               exercising such stock option which are delivered by such person
               to the Company in payment of the exercise price and/or related
               withholding taxes, (y) withheld by the Company, in payment of the
               withholding taxes with respect to the exercise of a stock option
               granted under the Predecessor Plan, from the total number of
               shares with respect to which such option is exercised, or (z) no
               longer subject to grants under the Predecessor Plan by reason of
               such grants


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               having expired or lapsed or having been canceled, surrendered,
               forfeited or otherwise terminated; plus

                    (ii) 1995 Authorized Shares. 850,000 Shares of Common Stock
               (the "1995 Authorized Shares"); and plus

                    (iii) 1997 Authorized Shares. 750,000 Shares of Common Stock
               (the "1997 Authorized Shares").

          The inclusion under this Plan of such shares reserved for issuance and
          sale under the Predecessor Plan as hereinabove provided shall not be
          affected by the expiration or other termination of the Predecessor
          Plan. The Shares issued and sold upon the exercise of Options may be
          treasury Shares, Shares of original issue or a combination thereof.

               (b) Computation of Shares Available for Grant. For purposes of
          computing the number of Authorized Shares available from time to time
          under the Plan for the grant of Options, the number of Shares subject
          to each Option granted pursuant to the Plan shall be provisionally
          counted against the Authorized Shares from and after the grant of such
          Option but only for so long as and to the extent that such Option
          shall remain outstanding and unexercised. Upon the exercise, in whole
          or in part, of an Option, the number of Shares issued upon such
          exercise shall be permanently deducted from the Authorized Shares,
          provided that no such permanent deduction shall be made, and the
          provisional deduction against the Authorized Shares shall be reversed,
          to the extent that the exercise price and/or the withholding taxes
          with respect to such exercise are paid through the delivery to the
          Company by the person exercising the Option of Shares already owned by
          such person and/or through the withholding by the Company of Shares
          from the total number of Shares with respect to which the Option is
          exercised. The provisional deduction against the Authorized Shares
          shall likewise be reversed to the extent of the unexercised portion of
          an Option upon the expiration, lapse, cancellation, surrender,
          forfeiture or other termination of such Option. The Shares covered by
          any such reversal of a provisional deduction against the Authorized
          Shares shall immediately become available for the granting of new
          Options under the Plan with respect thereto; provided, however, that
          any Shares covered by any such reversal which were 1995 Authorized
          Shares or 1997 Authorized Shares shall be subject to the restrictions
          set forth in Section 4(c) of the Plan.

          4.   ADMINISTRATION OF THE PLAN.

               (a)  Procedure. The Plan shall be administered by the Board or
          the Board may, in its discretion, appoint a Committee to administer
          the Plan subject to such terms and conditions as the Board may
          prescribe; provided that the terms upon which, including the time or
          times at or within which, and the price or prices at which Shares may
          be purchased upon the exercise of Options shall be approved or
          ratified by such action of the Board or a committee duly designated by
          the Board from its members as may be required by the Delaware General
          Corporation Law, as amended from time to time. Once appointed, the


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          Committee shall continue to serve until otherwise directed by the
          Board. From time to time the Board may increase the size of the
          Committee and may appoint additional members thereof, remove members
          (with or without cause), fill vacancies however caused and remove all
          members of the Committee and thereafter directly administer the Plan.

               (b)  Powers of the Committee. Subject to the provisions of this
          Plan, the Committee shall have the authority, in its sole discretion:

                    (i)  To determine, upon review of relevant information in
               accordance with Section 7(b) of the Plan, the "Fair Market Value"
               (as defined in said Section 7(b)) of the Shares;

                    (ii) To determine the Employees to whom, and the time or
               times at which, Options shall be granted and the number of Shares
               (up to a maximum of 500,000 Shares with respect to which Options
               may be granted to any individual in any one fiscal year of the
               Company) subject to purchase upon exercise of each Option (except
               as expressly set forth above in this Section 4(b)(ii) and such
               restrictions thereon as may be imposed by applicable tax laws
               which will have to be observed if the Committee intends that a
               particular Option qualify as a Tax Qualified Option, there is no
               limit on the time following the adoption or approval of this Plan
               within which Options may be granted under the Plan so long as it
               remains in effect, on the number of Options which may be granted
               to any one Employee or on the aggregate number of Shares subject
               to purchase thereunder);

                    (iii) To determine the terms and provisions of each Option
               (which terms and provisions need not be identical), including,
               but not limited to, the following;

                         (A) The exercise price per Share, subject to the
                    provisions of Section 7 of the Plan; and

                         (B) Whether Options shall become exercisable over a
                    period of time and when they shall be fully exercisable;

                    (iv) To accelerate the time as of which any Option may be
               exercised;

                    (v) To amend any outstanding Option, subject to the
               provisions of Section 19 of the Plan;

                    (vi) To authorize any person to prepare and execute on
               behalf of the Company any instrument deemed by the Committee to
               be necessary or advisable to evidence or effectuate the Plan, any
               Option granted thereunder or any amendment to the Plan or any
               Option;

                    (vii) To interpret the Plan;


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                    (viii) To prescribe, amend and rescind, if deemed necessary
               or appropriate, rules and regulations relating to the Plan, to
               the extent not inconsistent with the Plan; and

                    (ix) To make all other determinations the Committee may deem
               necessary or advisable in connection with the administration of
               the Plan.

               (c) Certain Limitations Applicable to Options Granted With
          Respect to 1995 Authorized Shares and 1997 Authorized Shares.
          Notwithstanding any other provision of the Plan, neither the Committee
          nor the Board shall, with respect to any Option granted under the Plan
          with respect to any 1995 Authorized Shares or 1997 Authorized Shares,
          provide for an "Option Term" (as defined in Section 6 of the Plan) of
          greater than eight (8) years from the date of grant thereof or approve
          any Repricing Transaction.

               (d) Effect of Board and Committee Decisions. All decisions,
          determinations and actions of the Board and the Committee in
          connection with the construction, interpretation, administration,
          application, operation and implementation of the Plan shall be final,
          conclusive and binding on the Company, its stockholders and
          Subsidiaries, all Employees and Optionees and the respective legal
          representatives, heirs, successors and assigns of all of the foregoing
          and all other Successors or other persons claiming under or through
          any of them.

               (e) Exculpation and Indemnification. No member of the Board or
          the Committee, and no Employee or other agent acting on behalf of the
          Board or the Committee, shall be personally liable for any decision,
          determination or action made or taken, or failed to be made or taken,
          with respect to this Plan or any Option granted hereunder, and the
          Company shall fully protect each such person in respect of any such
          decision, determination or action and shall indemnify each such person
          against any and all claims, losses, damages, expenses and liabilities
          arising from or in connection with any such decision, determination or
          action.

          5.   ELIGIBILITY. Options may be granted only to Employees who, in the
sole judgment of the Committee, have contributed or will contribute to the
success and growth of the Company. An Employee to whom the Company has
previously granted a stock option pursuant to this Plan or otherwise may, if he
is otherwise eligible, be granted additional Options.

          The existence of this Plan shall not create in any Employee any right
to be granted an Option hereunder, and neither the existence of this Plan nor
the granting of any Options to any Employee hereunder shall confer upon such
Employee any right with respect to continuation of the employment of such
Employee by the Company or any Subsidiary or shall in any way interfere with or
limit the right which such Employee, the Company or any Subsidiary may otherwise
have to terminate such employment at any time with or without cause. Upon the
termination of any Employee's employment with the Company or any Subsidiary,
neither the Company nor any Subsidiary shall have any liability or obligation to
such Employee under this Plan or any Options granted to such Employee hereunder
except to issue the appropriate number of Shares to such


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Employee upon the exercise of any Option granted to such Employee under this
Plan prior to such termination of employment, provided that such exercise is
duly and timely made in accordance with the provisions of this Plan and such
Option.

          6.   TERM OF OPTIONS. Except as may otherwise be specified by the
Committee in its sole discretion at the time of grant thereof and reflected in
the Option Agreement evidencing such Option, the term at the end of which each
Option shall expire (the "Option Term") shall be ten (10) years (eight (8) years
in the case of Options with respect to 1995 Authorized Shares or 1997 Authorized
Shares) from the date of grant thereof, provided that the Committee, if it
intends that a particular Option qualify as a Tax Qualified Option, will have to
observe such restrictions on the term of such Option as may be imposed by the
applicable tax laws in order for such Option so to qualify. Each Option shall
continue in effect in accordance with its terms notwithstanding that the Plan
may be terminated prior to the expiration of the term of such Option.

          7.   EXERCISE PRICE.

               (a)  Minimum Price Required. The per Share exercise price for the
          Shares subject to an Option shall be such price as is determined by
          the Committee at the time of grant of an Option and reflected in the
          Option Agreement evidencing the same; provided that in no event shall
          such exercise price per Share be less than the Fair Market Value per
          Share as of the day prior to the date of grant of such Option.

               (b)  Definition of "Fair Market Value". For all purposes under
          the Plan, "Fair Market Value" per Share shall be determined by the
          Committee in its sole discretion; provided that if the Shares are
          included in the NASDAQ National Market System or listed on a stock
          exchange on the date as of which the same is to be determined, the
          Fair Market Value per Share shall be the closing price on such
          quotation system or exchange which is the principal trading market for
          the Shares on the date of determination or, if no sale price was
          reported for the Shares on the date of determination, the closing
          price on such principal trading market for the last trading day prior
          to the date of determination for which a sale price was reported;
          provided further, however, that if the foregoing method of determining
          Fair Market Value is inconsistent with the then existing tax law
          requirements with respect to any Option which the Committee intends to
          qualify as a Tax Qualified Option, then the Fair Market Value per
          Share shall be determined by the Committee in such manner as is
          required for such Tax Qualified Option to qualify as such.

          8.   WITHHOLDING TAXES. Before a stock certificate evidencing the
Shares being acquired through exercise of an Option will be issued to the
Optionee or a Successor making such exercise, the Optionee or Successor must
pay, or make arrangements acceptable to the Company for the payment of, any and
all federal, state and local withholding taxes, whether domestic or foreign,
required to be withheld in connection with the exercise of an Option.


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          9.   FORM OF PAYMENT.

               (a) Acceptable Forms of Consideration. Except as may otherwise be
          specified by the Committee in its sole discretion at the time of grant
          thereof and reflected in the Option Agreement evidencing such Option,
          the following forms of consideration will be accepted in payment of
          the exercise price for the Shares to be issued upon exercise of an
          Option and of the taxes required to be withheld in connection with
          such exercise: (i) cash, (ii) personal check, (iii) bank cashier's
          check, (iv) already owned Shares (duly endorsed for transfer with
          signature guaranteed), or (v) any combination of the foregoing. Except
          as may otherwise be specified by the Committee in its sole discretion
          at the time of grant thereof and reflected in the Option Agreement
          evidencing such Option, Shares withheld from the Shares to be issued
          upon exercise of the Option, either alone or in any combination with
          any of the other acceptable forms of consideration recited in this
          Paragraph (a), will also be an accepted form of consideration for
          payment of the taxes required to be withheld in connection with the
          exercise of an Option. In addition to the acceptable forms of
          consideration hereinabove recited in this Paragraph (a), the Committee
          may determine in its sole discretion at the time of grant of an
          Option, and if the Committee so determines, shall provide in the
          Option Agreement evidencing such Option, that one or both of the
          following additional forms of consideration will be accepted, either
          alone or in any combination with any of the other acceptable forms of
          consideration recited in this Paragraph (a), in payment of the items
          specified: (vi) in payment of the exercise price for the Shares to be
          issued upon exercise of the Option, Shares withheld from the Shares to
          be issued upon such exercise, and/or (vii) in payment of the exercise
          price for the Shares to be issued upon exercise of an Option and the
          taxes required to be withheld in connection with such exercise, a
          commitment for the delivery to the Company of proceeds from the sale,
          pursuant to a brokerage or similar arrangement approved in advance by
          the Committee in its sole discretion, of Shares to be issued upon
          exercise of the Option. The forms of consideration which will be
          accepted in payment of the exercise price for an Option and related
          withholding taxes shall be specified in the Option Agreement
          evidencing such Option, the person or persons entitled to exercise the
          Option shall be entitled to elect from those so specified the form(s)
          to be used in effecting payment with respect to a particular exercise;
          provided that any election by a Section 16 Person to use already owned
          Shares or have Shares withheld from those issuable upon such exercise
          shall be effective only if made in accordance with the applicable
          requirements of Rule 16b-3; and provided further that a commitment for
          the delivery to the Company of proceeds from the sale, pursuant to a
          brokerage or similar arrangement, of Shares to be issued upon exercise
          of an Option will not be accepted from a Section 16 Person if under
          Securities Law Requirements such a sale would be matched with such
          exercise to result in "short swing" profit liability under Section
          16(b) of the Act on the part of such Section 16 Person with respect to
          such transaction.

               (b) Withholding Tax Loans. In addition to any one or more of the
          acceptable forms of consideration recited in Paragraph (a) of this
          Section 9 which the Committee may permit in the Option Agreement to be
          used for the payment of withholding taxes, the Committee may determine
          in its discretion at the time of grant of an Option to permit the


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          Optionee (but not any Successor) to, and if the Committee so
          determines, shall provide in the Option Agreement evidencing such
          Option that such Optionee may borrow from the Company an amount
          sufficient to pay the taxes required to be withheld in connection with
          the exercise of such Option by the Optionee, with each such borrowing
          to be evidenced by a promissory note of the Optionee payable to the
          order of the Company. Except as may otherwise be specified by the
          Committee in its sole discretion at the time of grant thereof and
          reflected in the Option Agreement evidencing an Option, each such loan
          shall be for a term of five (5) years at a rate of interest equal to
          the Company's then primary domestic commercial lender's prime or base
          rate as in effect from time to time, with payments of interest on such
          loan due quarterly and payments toward the principal of such loan due,
          to the extent of the net proceeds therefrom, within fifteen (15) days
          after any disposition by the Optionee of any Shares acquired upon
          exercise of any stock option granted by the Company to the Optionee
          pursuant to this Plan or otherwise (excluding any disposition of such
          Shares by gift or to the Company in payment of the exercise price of a
          stock option granted by the Company to the Optionee pursuant to this
          Plan or otherwise and/or any related withholding taxes), provided that
          the entire unpaid principal balance shall be due at the earlier of (i)
          the expiration of the five (5) year term, or (ii) the termination of
          the Optionee's Continuous Employment (other than by reason of
          Optionee's "disability" (as defined in Section 10(d)) or "retirement"
          (as defined in Section 10(e)).

               (c)  Company Withholding of Taxes. If, upon being notified by the
          Company of the amount of the taxes required to be withheld in
          connection with an exercise of an Option, the Optionee or a Successor
          fails promptly to pay, or to make arrangements acceptable to the
          Company for the payment of such taxes, the Company shall have the
          right to elect (but shall be under no obligation) to cover such taxes
          through:

                    (i) withholding Shares from those issuable upon such
               exercise, provided that any such election so to withhold Shares
               with respect to the exercise of an Option by a Section 16 Person
               shall be effective only if made in accordance with the applicable
               requirements of Rule 16b-3; and/or

                    (ii) deducting such taxes from any amounts payable in cash
               to the Optionee or the Successor by the Company for any reason as
               of the time of such exercise or any time thereafter.

               (d)  Valuation of Shares Delivered or Withheld. Where already
          owned Shares, or Shares withheld from those issuable upon such
          exercise, are used in payment of the exercise price and/or related
          withholding taxes, such Shares shall be valued at Fair Market Value as
          of the day immediately preceding the date of exercise and (ii) with
          respect to the payment of withholding taxes, at Fair Market Value as
          of the day immediately preceding the date tax withholding is required
          to be made.

               (e)  Certification of Already Owned Shares. Already owned Shares
          which were acquired through a previous exercise of a stock option
          granted pursuant to this Plan or otherwise may be used in payment of
          the exercise price of an Option and/or related


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          withholding taxes only if the previous exercise through which such
          Shares were acquired was made as of a date not less than six (6)
          months prior to the date of the exercise of the Option in connection
          with which such Shares are being tendered as payment. A tender of
          already owned Shares in payment of the exercise price of an Option
          and/or related withholding taxes will not be accepted by the Company
          unless accompanied by a written statement signed by the person or
          persons entitled to exercise such Option certifying that either (i)
          the Shares tendered in payment were acquired other than through the
          exercise of a stock option granted by the Company or (ii) the Shares
          tendered in payment were acquired through the exercise, on such
          date(s) as shall be recited in such statement (which date(s) shall be
          not less than six (6) months prior to the date of tender), of stock
          option(s) granted by the Company.

               (f)  Delivery of Already Owned Shares. Where the person
          exercising an Option elects to use already owned Shares in full or
          partial payment of the exercise price and/or related withholding
          taxes, the Committee may, in its sole discretion, accept, in lieu of
          physical delivery of the stock certificates evidencing such Shares,
          such constructive delivery of such Shares as may be satisfactory to
          the Committee.

          10.  METHOD OF EXERCISE.

               (a)  Procedure for Exercise; Rights as a Stockholder. Any Option
          granted hereunder shall be exercisable at such times and under such
          conditions as determined by the Committee and as permitted under the
          Plan. An Option may not be exercised for a fraction of a Share. In
          order to exercise an Option, the person or persons entitled to
          exercise it shall deliver to the Company written notice of the number
          of Shares with respect to which the Option is being exercised,
          accompanied by payment in full of the aggregate price for the Shares
          so to be acquired. To constitute an effective exercise of an Option,
          such notice and payment shall be addressed to the attention of the
          Treasurer of the Company and must be received at the principal
          executive office of the Company (i) with respect to an Option that is
          terminated for "Misconduct" (as defined below) pursuant to Paragraph
          (b) of this Section 10 or for "Prohibited Conduct" (as defined in
          Section 16(a)) pursuant to Section 16(a), prior to the time of the
          occurrence of the event constituting such Misconduct or Prohibited
          Conduct or (ii) with respect to any other Option, by 5:00 p.m., local
          time, on the date of expiration or termination of the Option. Until
          the issuance (as evidenced by the appropriate entry on the books of
          the Company or of a duly authorized transfer agent of the Company) of
          the stock certificate evidencing such Shares, no right to vote or
          receive dividends nor any other rights as a stockholder shall exist
          with respect to the Optioned Stock notwithstanding the exercise of the
          Option. No adjustment will be made for a dividend or other right for
          which the record date is prior to the date the stock certificate is
          issued, except as provided in Section 12.

               Exercise of an Option shall result in a decrease in the number of
          Shares which thereafter shall be available for sale under such Option
          by the number of Shares as to which the Option is exercised, including
          any Shares withheld from the Shares to be issued pursuant to such
          exercise to cover the exercise price and/or related withholding taxes.


                                       11
<PAGE>   12


               (b)  Termination of Employment. Except as may otherwise be
          specified by the Committee in its sole discretion at the time of grant
          thereof and reflected in the Option Agreement evidencing such Option,
          upon the termination of an Optionee's Continuous Employment (other
          than by reason of the Optionee's death, disability or retirement), the
          Optionee or any Successor entitled to exercise an Option may exercise
          the Option (to the extent that the Option was entitled to be exercised
          at the time of such termination of employment) until the earlier of
          (i) the date thirty (30) days (or such longer period of time as is
          determined by the Committee in its sole discretion at the time of such
          termination of employment, provided that if the Committee intends that
          a particular Option continue to qualify as a Tax Qualified Option, the
          Committee will have to observe such restrictions as may be imposed by
          applicable tax laws on the post-termination period within which a Tax
          Qualified Option may be exercised if it wishes to ensure that any
          post-termination exercise of such Option is made only within the
          period permitted by such laws) after the effective date of the
          termination of the Optionee's employment or (ii) the expiration date
          of such Option, and the Option shall terminate on the earlier of such
          dates; provided, however, that if the Optionee is terminated by the
          Company for Misconduct, then such Option shall terminate effective as
          of the time of the conduct constituting such Misconduct. As used in
          this Plan, "Misconduct" means that the Optionee has engaged in
          Prohibited Conduct, committed an act of embezzlement, fraud or theft
          with respect to the property or business of the Company or a
          Subsidiary or deliberately disregarded the rules of the Company or a
          Subsidiary in such a manner as to cause material loss, damage or
          injury to or otherwise endanger the property, reputation, employees or
          business prospects of the Company or a Subsidiary. The Committee shall
          determine whether an Optionee's employment was terminated by reason of
          Misconduct. In making such determination, the Committee may, but shall
          not be required to, give the Optionee an opportunity to be heard and
          to present evidence on his behalf.

               (c)  Death of Optionee. Except as may otherwise be specified by
          the Committee in its sole discretion at the time of grant thereof and
          reflected in the Option Agreement evidencing such Option, upon the
          death of an Optionee:

                    (i) who is at the time of his death in the employ of the
               Company or a Subsidiary and who shall have been in Continuous
               Employment since the date of grant of the Option, the Option may
               be exercised (to the extent the Option would have been entitled
               to be exercised had the Optionee continued living and terminated
               employment six (6) months after the date of death) by a Successor
               until the earlier of (A) the date six (6) months (or, if the
               Committee intends that a particular Option qualify as a Tax
               Qualified Option, such lesser period of time within which the
               applicable tax laws may require that the Option be exercised in
               order for such Option so to qualify) following the date of the
               Optionee's death or (B) the expiration date of such Option, and
               the Option shall terminate on the earlier of such dates; or


                                       12
<PAGE>   13


                    (ii) within one (1) month after the termination of
               Continuous Employment other than termination by the Company or a
               Subsidiary for Misconduct or due to disability, the Option may be
               exercised (to the extent the Option was entitled to be exercised
               at the date of termination of Continuous Employment) by a
               Successor until the earlier of (A) the date six (6) months
               following the date of the Optionee's death (or, if the Committee
               intends that a particular Option qualify as a Tax Qualified
               Option, such lesser period of time within which the applicable
               tax laws may require that the Option be exercised in order for
               such Option so to qualify) or (B) the expiration date of such
               Option, and the Option shall terminate on the earlier of such
               dates.

               (d)  Disability of Optionee. Except as may otherwise be specified
          by the Committee in its sole discretion at the time of grant thereof
          and reflected in the Option Agreement evidencing such Option, if an
          Optionee's Continuous Employment terminates due to optionee having
          become permanently and totally disabled within the meaning of Section
          23(e)(3) of the Code ("disability"), the Option may be exercised (to
          the extent the Option was entitled to be exercised as of the effective
          date of the termination of Optionee's employment by reason of such
          disability) until the earlier of (i) the date one (1) year after the
          effective date of such termination of employment or (ii) the
          expiration date of such Option, and the Option shall terminate on the
          earlier of such dates.

               (e)  Retirement of Optionee. Except as may otherwise be specified
          by the Committee in its sole discretion at the time of grant thereof
          and reflected in the Option Agreement evidencing such Option, if an
          Optionee's Continuous Employment terminates by reason of (A) his
          retirement at any age entitling him to benefits under the provisions
          of any retirement plan of the Company or any Subsidiary in which such
          Optionee participates; or (B) retirement at any time after attaining
          age 65 (whichever circumstance is applicable constituting
          "retirement"), the Option may be exercised (to the extent the Option
          shall be entitled to be exercised as of the effective date of the
          termination of the Optionee's employment by reason of such retirement)
          until the earlier of (i) the date three (3) months after the effective
          date of the termination of his employment or (ii) the expiration date
          of such Option, and the Option shall terminate on the earlier of such
          dates.

          11.  LIMITED TRANSFERABILITY OF OPTIONS.

               (a)  Options granted under the Plan and any rights and privileges
          appertaining thereto (1) may not be sold, pledged, assigned,
          hypothecated, transferred or disposed of in any manner by the Optionee
          other than (A) by will or the laws of descent and distribution, (B)
          pursuant to a "qualified domestic relations order" as defined in Code
          Section 414(p)(1)(B) and satisfying the requirements of Code Section
          414(p)(1)(A), or (C) with the consent of the Committee in the exercise
          of its discretion, to (x) a Family Member, (y) a Non-Profit
          Organization, or (z) a charitable trust, and (2) shall not be subject
          to execution, attachment or similar process. Transfers pursuant to
          clauses (1)(C)(x) may be approved by the Committee if made by gift or
          other transfer without the payment of any cash or other economic
          consideration by the transferee to the transferor or by sale or other
          transfer for cash or other economic consideration or otherwise,
          whereas transfers pursuant


                                       13
<PAGE>   14


          to clauses (1)(C)(y) and (1)(C)(z) may be approved by the Committee
          only if made without the payment of any cash or other economic
          consideration by the transferee. A transfer of an Option pursuant to
          one of the foregoing clauses (1)(A)-(C) may relate to all or any part
          of the Shares (but must be for whole Shares) which then continue to be
          subject to such Option.

                    (i) Written evidence of a transfer made pursuant to clauses
               (1)(A) or (1)(B), accompanied by the transferring Optionee's
               original copy of the Grant Agreement evidencing the transferred
               Option, shall be promptly provided to the Company upon the entry
               of the court order effecting, or other judicial authorization or
               direction of, such transfer. Upon the Committee's receipt of the
               foregoing, the Company shall cancel the original Option Agreement
               and re-issue a replacement Option Agreement to the transferee for
               the Option or portion thereof so transferred and to the
               transferring Optionee for any balance of the Option he or she
               retains without transfer.

                    (ii) Where an Optionee desires to make a transfer pursuant
               to clause (1)(C), the Optionee shall, prior to making of such
               transfer. provide written notice to the Committee of the proposed
               transfer, which notice shall identify the proposed transferee by
               name, demonstrate that the proposed transferee is within one of
               the classes of transferees permitted by such clause, describe in
               reasonable detail the terms of the proposed transfer and
               demonstrate that the transfer will comply with the applicable
               requirements of Section 15. Any transfer pursuant to clause
               (1)(C) shall otherwise be in form and substance reasonably
               acceptable to Committee; without limiting the generality of the
               foregoing, the Committee may condition its approval of such a
               transfer upon the transferor paying, or making other arrangements
               satisfactory to the Committee for the payment of, all withholding
               taxes, if any, which may required to be withheld in connection
               with the transfer. Upon the Committee's receipt and approval of
               the foregoing with respect to a proposed clause (1)(C) transfer,
               the Committee shall notify the Optionee proposing such transfer
               in writing of its approval of the transfer. Following receipt of
               such Committee approval, the Optionee shall be entitled to
               proceed with the transfer and shall provide the Company written
               notice of the consummation thereof. Upon the receipt of such
               consummation notice, the Company shall cancel the original Option
               Agreement and re-issue a replacement Option Agreement to the
               transferee for the Option or portion thereof so transferred and
               to the transferring Optionee for any balance of the Option he or
               she retains without transfer.

               (b) Upon the transfer of an Option or portion thereof in
          accordance with Section 11(a), the transferee shall succeed to, and be
          entitled to exercise, all of the rights and privileges of the
          transferring Optionee with respect to the Option or portion thereof so
          transferred, provided that the transferred Option in the hands of the
          transferee shall continue to be subject to all of the terms,
          conditions and restrictions under the Plan and the Option Agreement
          with respect to such Option which would be applicable to the


                                       14
<PAGE>   15


          Option were it still held by the Optionee to whom it was originally
          granted, including, without limitation, any requirement for the
          continued exercisability or other effectiveness of the Option based
          upon the life, employment or other status of the original Optionee and
          the payment of, or the making of arrangements acceptable to the
          Company for the payment of, any and all withholding taxes required to
          be withheld in connection with the exercise of the Option, whether
          such taxes are ultimately to be paid by the original Optionee (or in
          the event of his or her death prior to exercise by the transferee, his
          or her estate) or the transferee. Any transferee succeeding to an
          Option, whether by direct transfer from the original Optionee or, as
          permitted by Section 11(c), through further intervening transfers,
          shall also be subject to such restrictions on the exercise thereof as
          may be applicable to such transferee as a matter of law which would
          have applied to the Option were it still held by the original
          Optionee, such as, by way of example and not of limitation,
          restrictions on the exercise of an Option following a hardship
          withdrawal by the original Optionee from the Company's 401(k) plan.

               (c)  A Family Member succeeding to an Option pursuant to Section
          11(a)(1)(A) or Section 11(a)(1)(C)(x) may make further transfers of
          the Option or any portion thereof pursuant to Section 11(a)(1)(A) or,
          provided that the eligibility of the further transferee to received
          the transfer shall continue to be determined with reference to the
          original Optionee, pursuant to Section 11(a)(1)(C). However, a
          transferee of an Option pursuant to Section 11(a)(1)(A), 11(a)(1)(B),
          11(a)(1)(C)(y) or 11(a)(1)(C)(z) shall not be entitled to make any
          further transfer of the Option, except that the rights of a transferee
          pursuant to Section 11(a)(1)(A) or 11(a)(1)(B) may be transferred, by
          will or the laws of descent and distribution. The rights of any
          further transferee permitted by this Section 11(c) shall, as in the
          case of each prior transferee as provided in Section 11(b), be subject
          to all of the terms, conditions and restrictions under the Plan and
          the Option Agreement with respect to such Option which would be
          applicable to the Option were it still held by the original Optionee.

               (d)  The restrictions on transferability set forth in Section
          11(a) shall not be construed to limit the ability of an Optionee or
          Successor to elect to pay all or any portion of the exercise price
          using the form of consideration described with respect to clauses (vi)
          and (vii) of Section 9(a).

               (e)  Notwithstanding anything in the foregoing provisions of this
          Section 11 to contrary effect, no transferee succeeding to an Option
          shall be entitled to exercise the transferred option unless there
          shall be in effect a registration statement on an appropriate form or
          other filing covering the shares to be acquired through such exercise
          as required from time to time under applicable Securities Law
          Requirements and any other applicable provisions of law, including
          without limitation, state "blue sky" laws and foreign (national and
          provincial) securities laws and the rules and regulations promulgated
          under any of such laws, or such transferee establishes, to the
          satisfaction of counsel for the Company, that there is an applicable
          exemption from such Securities Law Requirements and other applicable
          laws.


                                       15
<PAGE>   16


          12.  ADJUSTMENTS UPON CHANGES IN CAPITALIZATION OR MERGER.

               (a)  Adjustments, in general. Subject to the provisions of
          Paragraph (b) of this Section 12 and to any required action by the
          stockholders of the Company, the number of Shares covered by each
          outstanding Option, and the number of Shares which have been
          authorized for issuance under the Plan but as to which no Options have
          yet been granted or which due to the expiration, lapse, cancellation,
          surrender, forfeiture or other termination of a stock option under
          this Plan or the Predecessor Plan are again available for grant, as
          well as the price per Share covered by each such outstanding Option,
          shall be proportionately adjusted for any increase or decrease in the
          number of issued and outstanding Shares resulting from a stock split,
          reverse stock split, stock dividend, combination or reclassification
          of Shares or any other increase or decrease in the aggregate number of
          issued and outstanding Shares effected without receipt of
          consideration by the Company; provided, however, that the issuance of
          Shares pursuant to the conversion or exchange of any securities of the
          Company convertible into or exchangeable for Shares shall not be
          deemed to have been "effected without receipt of consideration." Any
          fractional Shares which would otherwise result from any such
          adjustments shall be eliminated either by deleting all fractional
          Shares or by appropriate rounding to the next higher (fractions of
          one-half or more) or lower (fractions of less than one-half) whole
          Share. All such adjustments shall be made by the Board in its sole
          discretion. Except as expressly provided herein, no issuance by the
          Company of shares of stock of any class, or securities convertible
          into or exchangeable for shares of stock of any class, shall affect,
          and no adjustment by reason thereof shall be made to, the number of or
          exercise price for Shares subject to an Option.

               In the event of the proposed dissolution or liquidation of the
          Company, all outstanding Options will terminate immediately prior to
          the consummation of such proposed action, unless otherwise provided by
          the Board. The Board may, in the exercise of its sole discretion in
          such instances, declare that any Option shall terminate as of a date
          fixed by the Board and give each Optionee or a Successor the right to
          exercise his Option as to all or any part of the Optioned Stock,
          including Shares as to which the Option would not otherwise then be
          exercisable.

               Subject to the provisions of Paragraph (b) of this Section 12, in
          the event of a sale of all or substantially all of the assets of the
          Company, or the merger or consolidation of the Company with or into
          another corporation, each outstanding Option shall be assumed or an
          equivalent option shall be substituted by such successor corporation
          or a parent or subsidiary of such successor corporation, unless the
          Board, in the exercise of its sole discretion, determines that, in
          lieu of such assumption or substitution, the Optionee or a Successor
          shall have the right to exercise the Option as to all or any part of
          the Optioned Stock, including Shares as to which the Option would not
          otherwise then be exercisable. If in the event of a merger,
          consolidation or sale of assets the Board makes an Option fully
          exercisable in lieu of assumption or substitution, the Company shall
          notify the Optionee or Successor entitled to exercise the Option that
          the Option shall be fully exercisable for a


                                       16
<PAGE>   17


          period of thirty (30) days from the date of such notice, and the
          Option will terminate upon the expiration of such period.

               (b)  Special Adjustments upon Change in Control. In the event of
          a "Change in Control" of the Company (as defined in Paragraph (c) of
          this Section 12), unless otherwise determined by the Board in its sole
          discretion prior to the occurrence of such Change in Control, the
          following acceleration and valuation provisions shall apply:

                    (i)  Any Options outstanding as of the date of such Change
               in Control that are not yet fully vested on such date shall
               become fully vested; and

                    (ii) The value of all outstanding Options, measured by the
               excess of the "Change in Control Price" (as defined in Paragraph
               (d) of this Section 12) over the exercise price, shall be cashed
               out. The cash out proceeds shall be paid to the Optionee or the
               Successor entitled to exercise the Option.

               (c)  Definition of "Change in Control". For purposes of this
          Section 12, a "Change in Control" means the happening of any of the
          following:

                    (i) When any "person," as such term is used in Sections
               13(d) and 14(d) of the Act (other than the Company, a Subsidiary
               or a Company or Subsidiary employee benefit plan, including any
               trustee of such a plan acting as trustee) becomes the "beneficial
               owner" (as defined in Rule 13d-3 promulgated by the Commission
               under the Act, as adopted and amended from time to time and as
               interpreted by formal or informal opinions of, and releases
               published or other interpretive advice provided by, the Staff of
               the Commission), directly or indirectly, of securities of the
               Company representing fifty percent (50%) or more of the combined
               voting power of the Company's then outstanding securities; or

                    (ii) The consummation of a transaction requiring stockholder
               approval and involving the sale of all or substantially all of
               the assets of the Company or the merger or consolidation of the
               Company with or into another corporation.

               (d)  Definition of "Change in Control Price". For purposes of
          this Section 12, "Change in Control Price" shall be, as determined by
          the Board, (i) the highest closing sale price of a Share, as reported
          by the NASDAQ National Market, any stock exchange on which the Shares
          are listed or any other recognized securities market on which the
          Shares are traded, at any time within the sixty (60) day period
          immediately preceding the date of the Change in Control (the
          "Sixty-Day Period"), or (ii) the highest price paid or offered, as
          determined by the Board, in any bona fide transaction or bona fide
          offer related to the Change in Control, at any time within the
          Sixty-Day Period.


                                       17
<PAGE>   18

          13.  TIME OF GRANTING OPTIONS. The date of grant of an Option shall,
for all purposes, be the date on which the Committee makes the determination
granting such Option. Notice of such determination shall be given to each
Employee to whom an Option is so granted within a reasonable time after the date
of such grant.

          14.  OPTION AGREEMENTS. As a condition to the effectiveness of each
grant of an Option under this Plan, the Optionee shall enter into a written
Option Agreement in such form as may be authorized by the Committee from time to
time. Subject to the provisions of Section 20(a), each such Option Agreement
shall contain such provisions as are required by the terms of this Plan and may
contain such additional provisions not inconsistent with the terms of this Plan
as the Committee in its sole discretion may from time to time authorize. Each
Option Agreement evidencing an Option granted to a Section 16 Person shall also
provide for such minimum waiting period from the date of grant before the Option
may be exercised, and such minimum holding period from the date of the
acquisition of Shares upon exercise of an Option for which such Shares must be
held before making any disposition of such Shares, as may be required by Rule
16b-3.

          15.  CONDITIONS UPON ISSUANCE OF SHARES AND TRANSFERS OF OPTIONS.

          Notwithstanding anything express or implied to the contrary in the
Plan or any Option Agreement made hereunder:

               (a)  No Shares shall be issued with respect to an Option unless
          the exercise of such Option and the issuance and delivery of such
          Shares pursuant thereto, nor shall the transfer of an Option be
          effective under Section 11 unless the same, shall comply with all
          applicable Securities Law Requirements and all other applicable
          provisions of law, including without limitation, any applicable state
          "blue sky" laws and foreign (national and provincial) securities laws
          and the rules and regulations promulgated under any of such laws, and
          shall be further subject to the approval of counsel for the Company
          with respect to such compliance. As a condition to the exercise of an
          Option or the issuance of Shares upon exercise of an Option, or to the
          transfer of an Option under Section 11, the Company may require the
          person exercising such Option to make such representations and
          warranties to the Company as may be required, in the opinion of
          counsel for the Company, by any of the aforementioned Securities Law
          Requirements and other laws, which may include, without limitation,
          representations and warranties that the Shares which are being or may
          be purchased thereunder are being or will be acquired only for
          investment and without any present intention to sell or distribute
          such Shares.

               (b)  The Company shall not have any liability to any Optionee or
          Successor in respect of any delay in the sale or issuance of Shares,
          or the transfer of an Option, hereunder until the Company is able to
          effect any registration or other qualification or obtain such other
          approval or authority from any governmental authority (domestic or
          foreign) or self-regulatory organization having jurisdiction
          thereover, which registration, qualification, approval or authority is
          deemed by the Company's counsel to be necessary to the lawful


                                       18
<PAGE>   19


          sale, issuance or transfer of such Shares or Option, as the case may
          be, or in respect of any failure to sell or issue such Shares, or to
          effect any such Option transfer, as to which the Company is unable to
          obtain such requisite registration, qualification, approval or
          authority.

               (c)  The Company may, in its discretion, but shall be under no
          obligation to, effect or obtain any registration or other
          qualification or approval of any Option granted or transferred
          hereunder, or of any Shares issuable upon the exercise thereof, under
          any applicable Securities Law Requirements or any other applicable
          provisions of law, including without limitation, any applicable state
          "blue sky" laws and foreign (national and provincial) securities laws
          and the rules and regulations promulgated under any of such laws, and
          in the event any such registration, qualification or approval is not
          effected or obtained, such Option or Shares, as the case may be, shall
          be subject to such transfer and/or other restrictions (including, if
          so provided by such laws, rules and regulations, the prohibition of a
          particular transaction) as may be imposed by such laws, rules and
          regulations under such circumstances. By way of illustrating, but
          without limiting the generality of, the foregoing provisions of this
          Section 15(c), as of the time of the January 18, 2000 amendments to
          the Plan, the Shares issuable upon the exercise of an Option by an
          Employee were covered by an effective registration statement which the
          Company had prior to that date elected to file (consistent with the
          discretion recognized in this Section 15(c)) with the Commission on
          Form S-8 and would be freely tradable (subject to the filing of a Form
          144 and other applicable requirement of Rule 144 as then promulgated
          by the Commission to the extent applicable to the Employee at the time
          of any trade) by the Employee, but until the Company were to file (as
          of the date of such amendments, the Company has not yet filed and may
          be delayed in doing so until it is eligible to file) with the
          Commission a registration statement with respect thereto pursuant
          recent amendments to Form S-8, or were to elect to register under
          another available Form, the Shares issuable to the transferee of an
          Option under Section 11 would not upon his or her exercise thereof be
          able to dispose of such Shares on the public securities markets for
          such period as may be required by Rule 144 in the absence of an
          applicable Form S-8 or other registration statement. In the absence of
          such an effective registration, the Company may condition the transfer
          of an Option upon its receipt of a written acknowledgment from the
          transferee that the Option and the Shares issuable thereunder are
          subject to such transfer and/or other restrictions and require the
          Option Agreement evidencing such Option and the Shares so issued, as
          the case may be, shall bear such legends or include other appropriate
          provisions referencing such restrictions as the Company may reasonably
          require.

          16.  FOREFEITURE OF OPTIONS AND REALIZED BENEFITS.

               (a)  Loss of Unexercised Options. If an Optionee holding an
          outstanding Option, without the written consent of the Company as
          authorized by the Committee in its sole discretion, engages in any of
          the following conduct (any such conduct being referred to as
          "Prohibited Conduct") at any time during the period beginning on the
          date the Optionee first entered the employ of the Company or a
          Subsidiary and continuing for so


                                       19
<PAGE>   20

          long as any portion of such Option remains outstanding and unexercised
          (the "Grant Period"):

                    (i) rendering services for any organization or engaging
               directly or indirectly in any business which, in the sole
               judgment of the Committee, is or becomes competitive with the
               Company or a Subsidiary, or where such rendering of services or
               engaging in business, in the sole judgment of the Committee, is
               or becomes otherwise prejudicial to or in conflict with the
               interests of the Company or a Subsidiary; provided that the
               ownership of a not more than ten percent (10%) equity interest in
               any organization or business whose equity is listed on a
               recognized securities exchange or traded over-the-counter shall
               not constitute Prohibited Conduct within the meaning of this
               Subparagraph (i);

                    (ii) disclosing to anyone outside the Company or any
               Subsidiary, or use in other than the business of the Company or
               any Subsidiary, any confidential or proprietary information
               relating to the business of the Company or any Subsidiary,
               acquired by the Optionee either during or after employment with
               the Company or a Subsidiary;

                    (iii) except as may otherwise be permitted by any agreement
               otherwise made by the Company or a Subsidiary with the Optionee,
               failing to disclose fully and promptly in writing and assign to
               the Company or to the Subsidiary by which the Optionee is or was
               employed all right, title and interest in any discovery,
               invention, process, method, improvement or idea, whether or not
               patentable or subject to copyright protection and whether or not
               reduced to tangible form or reduced to practice, made or
               conceived by such person during employment by the Company or such
               Subsidiary, relating in any manner to the actual or contemplated
               business, research or development work of the Company or such
               Subsidiary or to do anything reasonably necessary to enable the
               Company or such Subsidiary to secure a patent, copyright or
               similar protection in the United States of America and/or in
               foreign countries as the Company or such Subsidiary may elect; or

                    (iv) inducing or attempting to induce any customer or
               supplier of the Company or a Subsidiary to breach any contract
               with the Company or a Subsidiary or otherwise terminate its
               relationship with the Company or a Subsidiary;

          then the Committee shall have the right, upon determining that the
          Optionee has engaged in any Prohibited Conduct at any time during the
          Grant Period (in making such determination, the Committee may, but
          shall not be required to, give the Optionee an opportunity to be heard
          and to present evidence on his behalf), to declare the Option
          forfeited and canceled effective as of the time of the conduct
          constituting such Prohibited Conduct.

               (b)  Certification upon Exercise. Each time an Option is
          exercised, the Optionee or Successor exercising the Option shall be
          deemed to certify to the Company


                                       20
<PAGE>   21

          that the Optionee did not, without the written consent of the Company
          as authorized by the Committee in its sole discretion, engage in any
          Prohibited Conduct at any time during the period beginning on the date
          the Optionee first entered the employ of the Company or a Subsidiary
          and ending on the date of such exercise (the "Pre-Exercise Period").

               (c)  Loss of Realized Benefits. In the event that the Committee
          determines with respect to a particular exercise of an Option that the
          Optionee engaged in any Prohibited Conduct at any time during the
          Pre-Exercise Period or within one (1) year after such exercise (in
          making such determination, the Committee may, but shall not be
          required to, give the Optionee an opportunity to be heard and to
          present evidence on his behalf), such Optionee shall be liable to the
          Company (i) to the extent such Optionee or a Successor has, prior to
          his receipt of the "Forfeiture Notice" (as defined below), disposed of
          the Shares acquired through such exercise, for payment to the Company
          of an amount in cash equal to the excess of (A) the net cash proceeds
          from such disposition (or if such Shares were disposed of other than
          for cash, the aggregate Fair Market Value of such Shares as of the
          date of disposition) over (B) that portion of the sum of the cash and
          the aggregate Fair Market Value as of the exercise date of any already
          owned Shares used by the Optionee or Successor to pay the exercise
          price for such Shares (such sum being referred to as the "Exercise
          Payment") which is allocable to the Shares disposed of in the
          proportion that such number of Shares bears to the total number of
          Shares issued pursuant to such Option exercise and (ii) to the extent
          such Optionee or Successor still owns at the time he receives the
          Forfeiture Notice the Shares acquired through such exercise, at the
          option of the Committee, either (A) for the return of such Shares to
          the Company in exchange for a cash refund from the Company to such
          Optionee or Successor in an amount equal to that portion of the
          Exercise Payment which is allocable to the Shares still owned in the
          proportion that such number of Shares bears to the total number of
          Shares issued pursuant to such Option exercise (such portion being
          referred to as the "Retained Shares Exercise Payment") or (B) for
          payment to the Company of an amount in cash equal to the excess of the
          aggregate Fair Market Value as of the exercise date of the Shares
          still owned over the Retained Shares Exercise Payment. To enforce such
          liability against an Optionee or Successor, the Committee shall notify
          the Optionee or Successor thereof in writing within three (3) years of
          the date of the affected Option exercise, which notice (the
          "Forfeiture Notice") shall include a statement of the form of payment
          which the Committee has elected to receive from the Optionee or
          Successor with respect to Shares still owned by the Optionee or
          Successor. Within ten (10) days after receiving the Forfeiture Notice,
          the Optionee or Successor shall make full payment of such liability to
          the Company in cash, or to the extent such Optionee or Successor still
          owns Shares acquired through the affected exercise and the Committee
          elects in the Forfeiture Notice to receive such Shares, stock
          certificates evidencing such Shares still owned by the Optionee or
          Successor(duly endorsed for transfer with signature guaranteed). In
          the event that the Committee elects to receive, and the Optionee or
          Successor returns, Shares, the Company shall make the refund payment
          required to be made to the Optionee or Successor with respect to such
          Shares upon the Company's receipt of such Shares as hereinabove
          required.


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<PAGE>   22

               (d)  Cumulative Rights. The obligation of an Optionee under this
          Section 16 to refrain from Prohibited Conduct is in addition to, and
          does not in any way supersede or diminish, any other obligation of
          such Optionee with respect to such matters which such Optionee may owe
          to the Company, any Subsidiary or any other person under any
          agreement, applicable law or otherwise (a "Similar Obligation"). Any
          action taken by the Company or the Committee to enforce, compromise,
          settle or waive the provisions of this Section 16 with respect to any
          particular event constituting Prohibited Conduct shall not in any way
          affect the rights of the Company, the Committee, any Subsidiary or any
          person against an Optionee with respect to any other event
          constituting Prohibited Conduct or any Similar Obligation, nor shall
          any action taken or failed to be taken by the Company, any Subsidiary
          or any other person against an Optionee to enforce, compromise, settle
          or waive any Similar Obligation have any effect on the rights of the
          Company and the Committee under this Section 16.

          17.  RESERVATION OF SHARES. The Company, during the term of this Plan,
shall at all times reserve and keep available such number of Shares as shall be
sufficient to satisfy the requirements of the Plan.

         18.   EFFECTIVENESS OF PLAN. This Plan was adopted by the Board on, and
shall be effective as of, August 27, 1990, subject to the approval hereof by the
vote of the Company's stockholders required therefor by the Delaware General
Corporation Law and applicable Securities Law Requirements within one (1) year
of the date of adoption by the Board, which approval was obtained at the Annual
Meeting of such stockholders held October 18, 1990. The Board has subsequently
approved increases in the number of Authorized Shares and, with respect to the
increases by the 1995 Authorized Shares and the 1997 Authorized Shares, certain
related amendments to this Plan subject to and which received such required
approval of the Company's stockholders at the Annual Meetings thereof held
August 19, 1992, August 19, 1994, August 31, 1995 and September 10, 1997. On
January 18, 2000, the Plan was further amended by the Board as to matters not
requiring any stockholder action with respect thereto. The Plan shall continue
in full force and effect until (i) terminated by resolution of the Board or (ii)
both (A) all Options granted under the Plan have been exercised in full and (B)
no Authorized Shares remain available for the granting of additional Options.
The termination of the Plan shall not affect Options already granted, which
Options shall remain in full force and effect in accordance with their
respective terms as if this Plan had not been terminated.

         19.  AMENDMENT OF PLAN AND OUTSTANDING OPTIONS. The Board may, in its
sole discretion, amend the Plan from time to time, provided that any amendment
which Rule 16b-3 or any other Securities Law Requirement requires be approved by
the stockholders of the Company shall be made only with the approval of such
stockholders. Amendments to the Plan shall apply prospectively to all Options
then outstanding under the Plan, except in the case of any amendment which is
adverse to an Optionee or Successor, in which case the amendment shall apply
with respect to the outstanding Options held by the adversely affected Optionee
or Successor only upon the consent of such Optionee or Successor to such
amendment. In exercising its authority under Section 4(b)(v) to amend
outstanding Options, the Committee likewise may make an amendment which
adversely affects the Optionee or Successor entitled to exercise the Option only
upon


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<PAGE>   23


the consent of such Optionee or Successor to such amendment. Notwithstanding the
provisions of this Section 19, the consent of the Optionee or Successor shall
not be required with respect to an amendment to the Plan or to any outstanding
Option which is made in order to comply with Securities Law Requirements or
which causes a Tax Qualified Option no longer to qualify as such.

          20.  GENERAL PROVISIONS.

               a.   Grants to Foreign Employees. Notwithstanding any other
          provision of this Plan to the contrary but subject to applicable
          Securities Law Requirements and tax laws, to the extent deemed
          necessary or appropriate by the Committee in its sole discretion in
          order to further the purposes of the Plan with respect to Employees
          who are foreign nationals and/or employed outside the United States of
          America, an Option granted to any such Employee may be on terms and
          conditions different from those specified in this Plan in recognition
          of the differences in the laws, tax policies and customs applicable to
          such an Employee, without the necessity of the Plan being amended to
          provide for such different terms and conditions.

               b.   Nature of Benefits. Benefits realized by an Optionee under
          this Plan or any Option granted hereunder shall not be deemed a part
          of such Optionee's regular, recurring compensation for purposes of the
          termination, indemnity or severance pay law of any country and shall
          not be included in, nor have any effect on, the determination of
          benefits under any other employee benefit plan or similar arrangement
          provided to such Optionee by the Company or a Subsidiary unless
          expressly so provided by such other plan or arrangement, or except
          where the Committee expressly determines in its sole discretion that
          an Option or portion thereof should be so included in order accurately
          to reflect competitive compensation practices or to recognize that an
          Option has been granted in lieu of a portion of competitive annual
          cash compensation.

               (c)  Determination of Deadlines. If any day on or before which
          action under this Plan or any Option granted hereunder must be taken
          falls on a Saturday, Sunday or Company-recognized holiday, such action
          may be taken on the next succeeding day which is not a Saturday,
          Sunday or Company-recognized holiday; provided, however, that the
          provisions of this Paragraph (c) shall not apply to, and shall not
          extend the time for exercise of, any Option which is terminated for
          Misconduct pursuant to Section 10(b) or for Prohibited Conduct
          pursuant to Section 16(a).

               (d)  Governing Law. To the extent that federal laws (such as the
          Act or the Code) or the Delaware General Corporation Law do not
          otherwise control, this Plan and all determinations made and actions
          taken pursuant hereto shall be governed by the laws of the State of
          Ohio and construed accordingly.


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<PAGE>   24


               (e)  Gender and Number. Whenever the context may require, any
          pronouns used herein shall include the corresponding masculine,
          feminine or neuter forms, and the singular form of nouns and pronouns
          shall include the plural and vice versa.

               (f)  Captions. The captions contained in this Plan are for
          convenience of reference only and do not affect the meaning of any
          term or provision hereof.


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