RMS TITANIC, INC.

                             2000 STOCK OPTION PLAN


         1. GRANT OF  OPTIONS;  GENERALLY.  In  accordance  with the  provisions
hereinafter  set  forth  in this  stock  option  plan,  the name of which is RMS
TITANIC,  INC. 2000 STOCK OPTION PLAN (the "Plan"),  the Board of Directors (the
"Board") or, the  Compensation  Committee (the "Stock Option  Committee") of RMS
Titanic,  Inc. (the  "Corporation")  is hereby  authorized to issue from time to
time  on the  Corporation's  behalf  to any  one or  more  Eligible  Persons  as
hereinafter  defined,  options to  acquire  shares of the  Corporation's  common
stock, par value $.0001 per share (the "Stock").

         2.  TYPE OF  OPTIONS.  The  Board  or the  Stock  Option  Committee  is
authorized to issue Incentive Stock Options ("ISOs") which meet the requirements
of Section 5422 of the Internal  Revenue Code of 1986,  as amended (the "Code"),
which options are hereinafter referred to collectively as ISOs, or singularly as
an ISO. The Board or the Stock  Option  Committee  is also,  in its  discretion,
authorized to issue options  which are not ISOs,  which options are  hereinafter
referred to collectively as Non Statutory Options ("NSOs"),  or singularly as an
NSO. The Board or the Stock Option Committee is also authorized to issue "Reload
Options" in accordance  with paragraph 8 herein,  which options are  hereinafter
referred to collectively  as Reload  Options,  or singularly as a Reload Option.
Except  where the  context  indicates  to the  contrary,  the term  "Option"  or
"Options" means ISOs, NSOs and Reload Options.

3.  AMOUNT  OF STOCK.  The  aggregate  number  of  shares of Stock  which may be
purchased pursuant to the exercise of options shall be _________Shares.  Of this
amount,  the  Board or the  Stock  Option  Committee  shall  have the  power and
authority  to  designate  whether any  options so issued  shall be ISOs or NSOs,
subject to the  restrictions on ISOs contained  elsewhere  herein.  If an Option
ceases to be  exercisable,  in whole or in part, the shares of Stock  underlying
such Option shall continue to be available under this Plan.  Further,  if shares
of Stock  are  delivered  to the  Corporation  as  payment  for  shares of Stock
purchased by the exercise of an Option  granted under this Plan,  such shares of
Stock  shall also be  available  under this Plan.  If there is any change in the
number  of  shares  of  Stock  due to of the  declaration  of  stock  dividends,
recapitalization  resulting in stock split-ups,  or combinations or exchanges of
shares of Stock,  or  otherwise,  the  number of shares of Stock  available  for
purchase upon the exercise of options, the shares of Stock subject to any Option
and the exercise price of any outstanding Option shall be approximately adjusted
by the  Board or the Stock  Option  Committee.  The  Board or the  Stock  Option
Committee  shall give notice of any  adjustments to each Eligible Person granted
an Option under this Plan, and such  adjustments  shall be effective and binding
on  all  Eligible  Persons.  If  because  of  one  or  more   recapitalizations,
reorganizations  or other  corporate  events,  the holders of outstanding  Stock
receive  something  other than shares of Stock then, upon exercise of an Option,
the Eligible  Person will receive what the holder would have owned if the holder
had exercised the Option  immediately  before the first such corporate event and
not disposed of anything the holder received as a result of the corporate event.

                                      -1-

<PAGE>

         4.   ELIGIBLE PERSONS.

           (a) With respect to ISOs, an Eligible  Person means any individual
who has been employed b the Corporation or by any subsidiary of the Corporation,
for a continuous period of at least sixty (60) days.

           (b) With respect to NSOs, an Eligible Person means (i) any individual
who  has  been  employed  by  the  Corporation  or  by  any  subsidiary  of  the
Corporation,  for a  continuous  period of at least  sixty (60)  days,  (ii) any
director of the  Corporation or any  subsidiary of the  Corporation or (iii) any
consultant of the Corporation or any subsidiary of the Corporation.

         5. GRANT OF OPTIONS.  The Board or the Stock Option  Committee  has the
right to issue the Options  established  by this Plan to Eligible  Persons.  The
Board or the Stock Option  Committee shall follow the procedures  prescribed for
it elsewhere  in this Plan.  A grant of Options  shall be set forth in a writing
signed on behalf of the Corporation or by a majority of the members of the Stock
Option Committee. The writing shall identify whether the option being granted is
an ISO or an NSO and shall set forth the terms  which  govern  the  Option.  The
terms shall be  determined by the Board or the Stock Option  Committee,  and may
include,  among other terms,  the number of shares of Stock that may be acquired
pursuant to the exercise of the Options, when the Options may be exercised,  the
period for which the Option is granted and including the  expiration  date,  the
effect on the Options if the Eligible Person  terminates  employment and whether
the Eligible  Person may deliver  shares of Stock to pay for the shares of Stock
to be  purchased by the  exercise of the Option.  However,  no term shall be set
forth in the writing which is  inconsistent  with any of the terms of this Plan.
The terms of an Option  granted to an Eligible  Person may differ from the terms
of an Option granted to another Eligible  Person,  and may differ from the terms
of an earlier Option granted to the same Eligible Person.

         6. OPTION PRICE.  The option price per share shall be determined by the
Board or the Stock Option Committee at the time any Option is granted, and shall
be not less than (i) in the case of an ISO, the fair market  value,  (ii) in the
case of an ISO granted to a ten percent or greater  stockholder,  110 percent of
the fair market value,  or (iii) in the case of an NSO, not less than 55% of the
fair  market  value  (but in no event  less than the par  value) of one share of
Stock on the date the Option is granted, as determined by the Board or the Stock
Option Committee. Fair market value as used herein shall be: paragraphs 7(a) and
(b).

         7.  (a)  If  shares  of  Stock  shall  be  traded  on  an  exchange  or
over-the-counter market, the mean between the high and low sales prices of Stock
on such exchange or over-the-counter market on which such shares shall be traded
on that date, or if such exchange or over-the-counter  market is closed or if no
shares shall have traded on such date, on the last  preceding date on which such
shares shall have traded.

               (b) If shares of Stock  shall  not be  traded on an  exchange  or
over-the-counter  market,  the value as determined by a recognized  appraiser as
selected by the Board or the Stock Option Committee.

                                      -2-
<PAGE>


         8.  PURCHASE OF SHARES.  An Option  shall be exercised by the tender to
the  Corporation  of the full purchase  price of the Stock with respect to which
the Option is exercised and written  notice of the exercise.  The purchase price
of the  Stock  shall be in  United  States  dollars,  payable  in  cash,  check,
Promissory  Note secured by the Shares  issued  through  exercise of the related
Options,  or in property or Corporation  stock,  if so permitted by the Board or
the  Stock  Option  Committee  in  accordance  with the  discretion  granted  in
paragraph 5 hereof, having a value equal to such purchase price. The Corporation
shall not be required to issue or deliver any  certificates  for shares of Stock
purchased  upon the  exercise  of an  option  prior to (i) if  requested  by the
Corporation,  the  filing  with the  Corporation  by the  Eligible  Person  of a
representation  in  writing  that  it is  the  Eligible  Person's  then  present
intention  to acquire  the Stock  being  purchased  for  investment  and not for
resale, and/or (ii) the completion of any registration or other qualification of
such shares under any government  regulatory body,  which the Corporation  shall
determine to be necessary or advisable.


         9. GRANT OF RELOAD OPTIONS.  In granting an Option under this Plan, the
Board or the  Stock  Option  Committee  may  include a Reload  Option  provision
therein,  subject to the provisions set forth in paragraphs 20 and 21 herein.  A
Reload Option  provision  provides that if the Eligible Person pays the exercise
price of shares  of Stock to be  purchased  by the  exercise  of an ISO,  NSO or
another Reload Option (the "Original  Option") by delivering to the  Corporation
shares of Stock already owned by the Eligible  Person (the  "Tendered  Shares"),
the Eligible Person shall receive a Reload option which shall be a new Option to
purchase  shares of Stock equal in number to the tendered  shares.  The terms of
any Reload option shall be determined by the Board or the Stock Option Committee
consistent with the provisions of this Plan.

         10. STOCK OPTION COMMITTEE. The Stock Option Committee may be appointed
from time to time by the  Corporation's  Board of Directors.  The Board may from
time to time remove  members from or add members to the Stock Option  Committee.
The Stock  Option  Committee  shall be  constituted  so as to permit the Plan to
comply in all respects with the provisions set forth in paragraph 20 herein. The
members  of the Stock  Option  Committee  may elect  one of its  members  as its
chairman.  The Stock Option  Committee shall hold its meetings at such times and
places  as  its  chairman  shall  determine.  A  majority  of the  Stock  Option
Committee's  members  present  in  person  shall  constitute  a  quorum  for the
transaction of business.  All  determinations of the Stock Option Committee will
be made by the majority vote of the members constituting the quorum. The members
may  participate  in a  meeting  of the Stock  Option  Committee  by  conference
telephone  or similar  communications  equipment  by means of which all  members
participating in the meeting can hear each other.  Participation in a meeting in
that manner will constitute  presence in person at the meeting.  Any decision or
determination  reduced to writing and signed by all members of the Stock  Option
Committee  will be  effective  as if it had been made by a majority  vote of all
members of the Stock  Option  Committee  at a meeting  which is duly  called and
held.

                                      -3-
<PAGE>

         11.  ADMINISTRATION  OF PLAN.  In addition  to granting  Options and to
exercising the authority  granted to it elsewhere in this Plan, the Board or the
Stock Option  Committee is granted the full right and authority to interpret and
construe the  provisions of this Plan,  promulgate,  amend and rescind rules and
procedures  relating  to the  implementation  of the Plan and to make all  other
determinations  necessary  or  advisable  for the  administration  of the Plan.,
consistent,  however, with the intent of the Corporation that Options granted or
awarded  pursuant to the Plan comply with the provisions of paragraphs 20 and 21
herein. All determinations made by the Board or the Stock Option Committee shall
be final,  binding and conclusive on all persons  including the Eligible Person,
the  Corporation  and its  stockholders,  employees,  officers and directors and
consultants. No member of the Board or the Stock Option Committee will be liable
for any act or  omission  in  connection  with the  administration  of this Plan
unless it is attributable to that member's willful misconduct.

         12. PROVISIONS APPLICABLE TO ISOs. The following provisions shall apply
to all  ISOs  granted  by the  Board  or the  Stock  Option  Committee  and  are
incorporated by reference into any writing granting an ISO:

                  (a) An ISO may only be  granted  within  ten (10)  years  from
2000, the date that this Plan was originally adopted by the Corporation's  Board
of Directors.

                  (b) An ISO may not be  exercised  after the  expiration  of
ten (10) years from the date the ISO is granted.

                  (c) The  option  price  may not be less  than the fair  market
value of the Stock at the time the ISO is granted.

                  (d) An ISO is not  transferable by the Eligible Person to whom
it is granted  except by will, or the laws of descent and  distribution,  and is
exercisable during his or her lifetime only by the Eligible Person.

                  (e) If the Eligible Person  receiving the ISO owns at the time
of the grant stock  possessing more than ten (10%) percent of the total combined
voting  power of all  classes  of stock of the  employer  corporation  or of its
parent or subsidiary  corporation (as those terms are defined in the Code), then
the option  price shall be at least 110% of the fair market  value of the Stock,
and the ISO shall not be exercisable after the expiration of five (5) years from
the date the ISO is granted.

                  (f) The aggregate  fair market value  (determined  at the time
the ISO is  granted)  of the  Stock  with  respect  to  which  the ISO is  first
exercisable by the Eligible Person during any calendar year (under this Plan and
any other  incentive  stock  option  plan of the  Corporation)  shall not exceed
$100,000.

                  (g) Even if the shares of Stock which are issued upon exercise
of an ISO are sold within one year  following  the  exercise of such ISO so that
the sale  constitutes a  disqualifying  disposition  for ISO treatment under the
Code, no provision of this Plan shall be construed as prohibiting such a sale.

                                      -4-
<PAGE>


                  (h) This Plan was adopted by the  Corporation on April , 2000,
by virtue of its approval by the Corporation's Board of Directors.

         13.  DETERMINATION  OF FAIR MARKET  VALUE.  In granting ISOs under this
Plan,  the  Board  or the  Stock  Option  Committee  shall  make  a  good  faith
determination  as to the fair market  value of the Stock at the time of granting
the ISO.

         14.  RESTRICTIONS ON ISSUANCE OF STOCK.  The  Corporation  shall not be
obligated  to sell or issue any shares of Stock  pursuant  tot he exercise of an
Option  unless the Stock with respect to which the Option is being  exercised is
at that time  effectively  registered  or  exempt  from  registration  under the
Securities Act of 1933, as amended,  and any other  applicable  laws,  rules and
regulations.  The Corporation may condition the exercise of an option granted in
accordance  herewith  upon  receipt  from  the  Eligible  Person,  or any  other
purchaser thereof, of a written representation that at the time of such exercise
it is his or her then  present  intention  to  acquire  the  shares of Stock for
investment  and  not  with a view  to,  or for  sale  in  connection  with,  any
distribution  thereof,  except that, in the case of a legal  representative of n
Eligible Person, "distribution" shall be defined to exclude distribution by will
or under the laws of descent  and  distribution.  Prior to issuing any shares of
Stock  pursuant to the exercise of an Option,  the  Corporation  shall take such
steps as it deems necessary to satisfy any  withholding tax obligations  imposed
upon it by any level of government.

         15.     EXERCISE IN THE EVENT OF DEATH OF TERMINATION OF EMPLOYMENT.

                  (a) If an  optionee  shall  die (i) while an  employee  of the
Corporation  or a Subsidiary  or (ii) within three months after  termination  of
this employment with the Corporation or a Subsidiary  because of his disability,
or retirement or otherwise, his options may be exercised, to the extent that the
optionee  shall  have  been  entitled  to do so on the date of his death or such
termination of employment, by the person or persons to whom the optionee's right
under the option pass by will or  applicable  law, or if no such person has such
right, by his executors or administrators, at any time, or from time to time. In
the event of termination of employment because of his death while an employee or
because  of  disability,  his  options  may be  exercised  not  later  than  the
expiration date specified in paragraph 5 or one year after the optionee's death,
whichever date is earlier,  or in the event of termination of employment because
of retirement  or otherwise,  not later than the  expiration  date  specified in
paragraph 5 hereof or one year after the  optionee's  death,  whichever  date is
earlier.

                  (b)  If an  optionee's  employment  by  the  Corporation  or a
Subsidiary  shall terminate  because of his disability and such optionee has not
died within the  following  three  months,  he may exercise his options,  to the
extent that he shall have been entitled to do so at the date of the  termination
of his  employment,  at any time,  or from time to time,  but not later than the
expiration date specified in paragraph 5 hereof or one year after termination of
employment, whichever date is earlier.

                                      -5-
<PAGE>


                  (c) If an optionee's  employment  shall terminate by reason of
his retirement in accordance with the terms of the  Corporation's  tax-qualified
retirement  plans,  if any, or with the consent of the Board or the Stock Option
Committee  or  involuntarily  other  than by  termination  for  cause,  and such
optionee has not died within the  following  three  months,  he may exercise his
Option to the  extent he shall  have been  entitled  to do so at the date of the
termination of his employment,  at any time and from time to time, but not later
than the  expiration  date  specified  in paragraph 5 hereof or thirty (30) days
after termination of employment, whichever date is earlier. For purposes of this
paragraph 14,  termination  for cause shall mean: (i)  termination of employment
for cause as  defined  in the  optionee's  Employment  Agreement  or (ii) in the
absence of an Employment  Agreement for the optionee,  termination of employment
by reason of the optionee's  commission of a felony, fraud or willful misconduct
which has resulted,  or is likely to result,  in substantial and material damage
to the  Corporation  or a  Subsidiary,  all as the  Board  or the  Stock  Option
Committee in it sole discretion may determine.

                  (d) If an optionee's employment shall terminate for any reason
other than death, disability, retirement or otherwise, all right to exercise his
Option shall  terminate at the date of such  termination  of  employment  absent
specific provisions in the optionee's Option Agreement.

         16.  CORPORATE  EVENTS.  In the event of the  proposed  dissolution  or
liquidation of the Corporation,  a proposed sale of all or substantially  all of
the assets of the Corporation,  a merger or tender for the Corporation's  shares
of Common  Stock the Board of  Directors  may declare  that each Option  granted
under  this  Plan  shall  terminate  as of a date to be  fixed  by the  Board of
Directors;  provided  that not less than thirty (30) days written  notice of the
date so fixed shall be given to each Eligible Person holding an option, and each
such Eligible Person shall have the right, during the period of thirty (30) days
preceding such  termination,  to exercise his Option as to all or any par of the
shares of Stock  covered  thereby,  including  shares of Stock as to which  such
Option would not otherwise be exercisable. Nothing set forth herein shall extend
the term set for purchasing the shares of Stock set forth in the Option.

         17. NO GUARANTEE OF EMPLOYMENT.  Nothing in this Plan or in any writing
granting an Option will confer upon any Eligible Person the right to continue in
the employ of the Eligible Person's employer, or will interfere with or restrict
in any way the  right  of the  Eligible  Person's  employer  to  discharge  such
Eligible Person at any time for any reason whatsoever, with or without cause.

         18.  NON-TRANSFERABILITY.  No Option  granted  under the Plan  shall be
transferable  other  than by will or by the laws of  descent  and  distribution.
During the lifetime of the optionee, an Option shall be exercisable only by him.

         19. NO RIGHTS AS  STOCKHOLDER.  No optionee  shall have any rights as a
stockholder  with respect to any shares  subject to his Option prior to the date
of issuance to him of a certificate or certificates for such shares.

                                      -6-
<PAGE>


         20. AMENDMENT AND  DISCONTINUANCE OF PLAN. The  Corporation's  Board of
Directors may amend,  suspend or discontinue this Plan at any time.  However, no
such  action  may  prejudice  the  rights of any  Eligible  Person who has prior
thereto been granted Options under this Plan. Further, no amendment to this Plan
which has the effect of (a) increasing  the aggregate  number of shares of Stock
subject to this Plan (except for adjustments pursuant to paragraph 3 herein), or
(b) changing the definition of Eligible Person under this Plan, may be effective
unless and until approval of the  stockholders of the Corporation is obtained in
the same manner as approval of this Plan is required. The Corporation's Board of
Directors is authorized to seek the approval of the  Corporation's  stockholders
for any other  changes  it  proposes  to make to this Plan  which  require  such
approval,  however, the Board of Directors may modify the Plan, as necessary, to
effectuate  the  intent  of the  Plan as a  result  of any  changes  in the tax,
accounting  or  securities  laws  treatment  of  Eligible  Persons and the Plan,
subject to the  provisions set forth in this paragraph 19, and paragraphs 20 and
21.

         21.  COMPLIANCE WITH RULE 16b-3.  This Plan is intended t comply in all
respects  with Rule 16b-3 ("Rule  16b-311)  promulgated  by the  Securities  and
Exchange  Commission under the Securities  Exchange Act of 1934, as amended (the
"Exchange  Act"),  with respect to participants who are subject to Section 16 of
the Exchange Act, and any provision(s) herein that is/are contrary to Rule 16b-3
shall be deemed  null and void to the  extent  appropriate  by either  the Stock
Option Committee or the Corporation's Board of Directors.

         22.  COMPLIANCE WITH CODE. The aspects of this Plan on ISOs is intended
to comply in every  respect  with  Section  422 of the Code and the  regulations
promulgated  thereunder.  In the event any future  statute or  regulation  shall
modify the existing statute,  the aspects of this Plan n ISOs shall be deemed to
incorporate by reference such modification.  Any stock option agreement relating
to any Option granted  pursuant tot his Plan  outstanding and unexercised at the
time any modifying statute or regulation  becomes effective shall also be deemed
to incorporate by reference such modification and no notice of such modification
need be given to optionee.

         If any  provision of the aspects of this Plan on ISOs is  determined to
disqualify  the shares  purchasable  pursuant to the Options  granted under this
Plan from the special tax treatment provided by Code Section 422, such provision
shall be deemed null and void and to incorporate  by reference the  modification
required to qualify the shares for said tax treatment.

         23. COMPLIANCE WITH OTHER LAWS AND REGULATIONS. The Plan, the grant and
exercise of options  thereunder,  and the obligation of the  Corporation to sell
and deliver Stock under such options, shall be subject to all applicable federal
and state laws,  rules,  and regulations and to such approvals by any government
or regulatory  agency as may be required.  The Corporation shall not be required
to issue or  deliver  any  certificates  for  shares  of Stock  prior to (a) the
listing of such shares on any stock exchange or over-the-counter market on which
the Stock may then be  listed  and (b) the  completion  of any  registration  or
qualification  of such  shares  under any federal or state law, or any ruling or
regulation  of any  government  body which the  Corporation  shall,  in its sole
discretion,  determine to be necessary or advisable.  Moreover, no option may be
exercised  if its  exercise or the receipt of Stock  pursuant  thereto  would be
contrary to applicable laws.

                                      -7-
<PAGE>

         24.  DISPOSITION OF SHARES. In the event any share of Stock acquired by
an exercise of an option granted under the Plan shall be transferable other than
by will or by the laws of descent and distribution  within two years of the date
such  Option was  granted or within  one year after the  transfer  of such Stock
pursuant to such exercise, the optionee shall give prompt written notice thereof
to the Corporation or the Stock Option Committee.

         25. NAME. The Plan shall be known as the "RMS Titanic,  Inc. 2000 Stock
Option Plan."

         26.  NOTICES.  Any notice  hereunder  shall be in  writing  and sent by
certified  mail,  return receipt  requested or by facsimile  transmission  (with
electronic  or  written  confirmation  of  receipt)  and when  addressed  to the
Corporation  shall be sent to its office,  17 Battery Place,  New York, New York
10004,  and when  addressed to the  Committee  shall be sent to it at 17 Battery
Place,  New York,  New York  10004,  subject  to the  right of  either  party to
designate at any time hereafter in writing some other address,  facsimile number
or person to whose attention such notice shall be sent.

         27.  HEADINGS.   The  headings  preceding  the  text  of  Sections  and
subparagraphs hereof are inserted solely for convenience of reference, and shall
not  constitute  a part  of  this  Plan  nor  shall  they  affect  its  meaning,
construction or effect.

         28.  EFFECTIVE DATE. This Plan, the RMS Titanic,  Inc. 200 Stock Option
Plan, was adopted by the Board of Directors of the  Corporation on April , 2000.
The effective date of the Plan shall be the same date.

Dated as of April       , 2000.
                 -------
                                          RMS TITANIC, INC.




                                          By
                                             ---------------------
                                              President


                                      -8-
<PAGE>

                               RMS TITANIC, INC.
                                17 Battery Place
                            New York, New York 10004


                                               Date:
                                                       --------------


----------------------

----------------------

----------------------

Dear                             :
     ----------------------------

                  The   Board  of   Directors   of  RMS   Titanic,   Inc.   (the
"Corporation")  is pleased to award you an Option  pursuant to the provisions of
the 2000 Stock Option Plan (the  "Plan").  This letter will  describe the Option
granted to you.  Attached to this letter is a copy of the Plan. The terms of the
Plan also set forth provisions  governing the Option granted to you.  Therefore,
in addition to reading this letter you should also read the Plan. Your signature
on this letter is an  acknowledgment to us that you have read and understand the
Plan and that you agree to abide by its  terms.  All terms not  defined  in this
letter shall have the same meaning as in the Plan.

                  1.   TYPE OF OPTION.  You are granted an NSO.  Please see in
particular Section 11 of the Plan.

                  2.   RIGHTS  AND   PRIVILEGES.   Subject  to  the   conditions
hereinafter  set forth,  we grant you the right to purchase shares of Stock at $
per share,  the  current  fair  market  value of a share of Stock.  The right to
purchase  the shares of Stock  accrues  in  installments  over the time  periods
described below:

                  The right to acquire                  shares accrues on
                                      -----------------
                  The right to acquire                  shares accrues on
                                      -----------------

                  3. TIME OF  EXERCISE.  The option may be exercised at any time
and from time to time  beginning  when the right to purchase the shares of Stock
accrues and ending when they terminate as provided in Section 5 of this letter.

                  4. METHOD OF  EXERCISE.  The  Options  shall be  exercised  by
written notice to the Chief  Financial  Officer at the  Corporation's  principal
place of  business.  The notice shall set forth the number of shares of Stock to
be acquired and shall contain a check payable to the Corporation in full payment
for the Stock or that number of already  owned shares of Stock equal in value to
the total Exercise Price of the Option.  We shall make delivery of the shares of
Stock subject to the conditions described in Section 13 of the Plan.


<PAGE>

         5.  TERMINATION  OF OPTION.  To the extent not  exercised,  the Option
shall  terminate  upon the first to occur of the following dates:

                  (a)      , 200  , being       Years from the date of grant
                     -----      -        ------
pursuant to the provisions of Section 2 of this Agreement, or

                  (b) The  expiration  of three months  following  the date your
employment  terminates with the Corporation and any of its subsidiaries included
in the  Plan  for any  reason,  other  than by  reason  of  death  or  permanent
disability.  As used  herein,  "permanent  disability"  means your  inability to
engage  in  any  substantial   gainful  activity  by  reason  of  any  medically
determinable  physical or mental  impairment  which can be expected to result in
death or which has lasted or can be expected to last for a continuous  period of
not less than 12 months; or

                  (c) The  expiration  of 12  months  following  the  date  your
employment  terminates with the Corporation and any of its subsidiaries included
in the Plan, if such employment termination occurs by reason of your death or by
reason of your permanent disability (as defined above).

         6. SECURITIES  LAWS. The option and the shares of Stock  underlying the
Option have not been  registered  under the  Securities  Act of 1933, as amended
(the "Act").  The  Corporation has no obligations to ever register the option or
the shares of Stock underlying the Option. All shares of Stock acquired upon the
exercise of the Option shall be "restricted  securities" as that term is defined
in Rule 144 promulgated  under the Act. The certificate  representing the shares
shall bear an appropriate legend restricting their transfer.  Such shares cannot
be sold,  transferred,  assigned or otherwise  hypothecated without registration
under the Act or unless a valid  exemption from  registration  is then available
under applicable  federal and state securities laws and the Corporation has been
furnished with an opinion of counsel  satisfactory  in form and substance to the
Corporation that such registration is not required.

         7. BINDING EFFECT. The rights and obligations  described in this letter
shall inure to the benefit of and be binding upon both os us, and our respective
heirs, personal representatives, successors and assigns.

                                      -2-
<PAGE>


         8. DATE OF GRANT. The Option shall be treated as having been granted to
you on the date of this letter even though you may sign it at a later date.

                                      Very truly yours,

                                      ---------------------------




                                      By
                                        -------------------------
                                           President



                                      Very truly yours,

                                      ---------------------------



                                      By
                                        -------------------------
                                          President