ZIASUN TECHNOLOGIES, INC.
                             (A Nevada Corporation)

                             1999 STOCK OPTION PLAN
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     The following  constitutes  the provisions of the 1999 Stock Option Plan of
ZiaSun Technologies, Inc.

                                    ARTICLE 1

                                    OVERVIEW

     1.1  Purpose.  The purpose of the 1999 Stock Option Plan (the "Plan") is to
attract,  retain, and reward persons providing services to ZiaSun  Techonolgies,
Inc., a Nevada Corporation,  and any successor corporation thereto (collectively
referred  to as  the  "Company"),  and  any  present  or  future  parent  and/or
subsidiary corporations of such corporation (all of which along with the Company
being  individually  referred to as a  "Participating  Company" and collectively
referred to as the "Participating  Company Group"), and to motivate such persons
to  contribute to the growth and profits of the  Participating  Company Group in
the future.  For  purposes of the Plan,  a parent  corporation  and a subsidiary
corporation  shall be as defined in Sections  424(e) and 424(f) of the  Internal
Revenue Code of 1986, as amended (the "Code").

     1.2   Administration.   The   following   provisions   shall   govern   the
administration of the Plan:

          (a)  Administration  By Board  And/Or  Committee.  The  Plan  shall be
          administered  by the Board of Directors  of the Company (the  "Board")
          and/or by a duly  appointed  committee of the Board having such powers
          as shall be specified by the Board. Any subsequent  references  herein
          to the Board shall also mean the committee if such  committee has been
          appointed,   and  unless  the  powers  of  the  committee   have  been
          specifically limited.

          (b) Committee Powers.  The Committee shall effect the grant of options
          under  the Plan by  execution  of  instruments  in  writing  in a form
          approved by the Committee. Subject to the express terms and conditions
          of the Plan, the Committee  shall have full power to construe the Plan
          and the terms of any  option  granted  under the Plan,  to  prescribe,
          amend  and  rescind  rules  and  regulations  relating  to the Plan or
          options and to make all other  determinations  necessary  or advisable
          for the Plan's  administration,  including,  without  limitation,  the
          power to:

               (i) determine which persons meet the  requirements of Sections 2,
               3, and 4 hereof for selection as participants in the Plan;

               (ii) determine to whom of the eligible  persons,  if any, options
               shall be granted under the Plan;

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               (iii) establish the terms and conditions required or permitted to
               be included in every option agreement or any amendments  thereto,
               including  whether  options  to be  granted  thereunder  shall be
               "Incentive Stock Options," as defined in section 422 of the Code,
               or nonqualified stock options not described in sections 422(b) or
               423(a) of the Code;

               (iv) specify the number of shares to be covered by each option;

               (v)  determine the method by which fair market value of shares of
               the Company's common stock will be established under the Plan;

               (vi)  take  appropriate  action to amend  any  option  hereunder,
               provided  that no such  action may be taken  without  the written
               consent of the affected optionee;

               (vii) cancel  outstanding  options and issue replacement  options
               therefor with the consent of the affected optionee; and

               (viii)  make  all  other   determinations   deemed  necessary  or
               advisable for administering the Plan.

     The Committee's determination on the foregoing matters shall be conclusive.

          (c) Special Rule for Officers and  Directors.  The grant of options to
          employees  who  are  officers  or  directors  of  the  Company  and to
          nonemployee directors of the Company may be made by and all discretion
          with respect to the material  terms of the options may be exercised by
          either (i) the Board of Directors,  or (ii) a duly appointed committee
          of the  Board  composed  solely of two or more  nonemployee  directors
          having  full  authority  to act in the matter.  The term  "nonemployee
          directors"  shall  have  the  meaning  set  forth  in  Rule  16b-3  as
          promulgated by the Securities  and Exchange  Commission  ("SEC") under
          section 16(b) of the Securities  Exchange Act of 1934, as amended (the
          "Exchange Act"), as that rule may be amended from time to time, and as
          interpreted by the SEC ("Rule 16b-3").

          (d) Options Authorized.  Options may be either Incentive Stock Options
          as defined in Section 422 of the Code  ("Incentive  Stock Options") or
          nonqualified stock options.

     1.3 Eligibility.

          (a)  Eligible  Persons.  Options  may be  granted  only  to  employees
          (including officers) and directors of the Participating Company Group,
          or to individuals who are rendering services as consultants, advisors,
          or other independent  contractors to the Participating  Company Group.
          The Board shall, in its sole discretion, determine which persons shall
          be  granted  Options  (an  "Optionee").   Notwithstanding   any  other
          provision of the Plan, no Eligible Person shall in any single calendar
          year be granted  options to purchase  more than an  aggregate of three
          hundred thousand  (300,000) shares of the Company's common stock under
          the Plan, as adjusted pursuant to Section 6.2.

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          (b)  Restrictions  on Option  Grants.  A director  of a  Participating
          Company may only be granted a  nonqualified  stock  option  unless the
          director is also an employee of the  Participating  Company Group.  An
          individual  who is rendering  services as a  consultant,  advisor,  or
          other independent  contractor may only be granted a nonqualified stock
          option.

     1.4 Shares  Subject to Option.  Options shall be for the purchase of shares
of the authorized but unissued  common stock or treasury  shares of common stock
$0.001 par value of the Company (the "Stock"), subject to adjustment as provided
in Section 6.2 below.  The maximum number of shares of Stock which may be issued
under the Plan shall be Two Million Five Hundred Thousand (2,500,000) shares. In
the event that any outstanding Option for any reason expires or is terminated or
canceled  and/or shares of Stock subject to repurchase  are  repurchased  by the
Company, the shares allocable to the unexercised portion of such Option, or such
repurchased shares, may again be subject to an Option grant. Notwithstanding the
foregoing,  any such  shares  shall be made  subject to a new Option only if the
grant of such new Option and the  issuance of such  shares  pursuant to such new
Option  would  not  cause  the  Plan or any  Option  granted  under  the Plan to
contravene Rule 16b-3.

     1.5 Time for Granting  Options.  All Options  shall be granted,  if at all,
within  seven (7) years from the  earlier of the date the Plan is adopted by the
Board or the date the Plan approved by the stockholders of the Company.

     1.6 Terms, Conditions and Form of Options. Subject to the provisions of the
Plan,  the Board shall  determine  for each Option (which need not be identical)
the  number  of shares of Stock for  which  the  Option  shall be  granted,  the
exercise price of the Option, the timing and terms of exercisability and vesting
of the  Option,  the  time  of  expiration  of the  Option,  the  effect  of the
Optionee's  termination  of employment  or service,  whether the Option is to be
treated as an Incentive  Stock Option or as a  nonqualified  stock  option,  the
method for satisfaction of any tax withholding  obligation arising in connection
with the Option,  including by the  withholding  or delivery of shares of stock,
and all other terms and conditions of the Option not inconsistent with the Plan.
Options  granted  pursuant to the Plan shall be evidenced by written  agreements
specifying  the number of shares of Stock covered  thereby,  in such form as the
Board shall from time to time establish, which agreements may incorporate all or
any of the terms of the Plan by  reference  and shall comply with and be subject
to the following terms and conditions:

                                    ARTICLE 2

                             INCENTIVE STOCK OPTIONS

     2.1  Incentive  Stock  Option  Terms and  Conditions.  Options  granted  to
employees (but not to nonemployee  directors)  under the terms and conditions of
this Section 2 are intended to be Incentive  Stock  Options under section 422 of

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the Code. Each Incentive Stock Option granted under the Plan shall be authorized
by action of the Committee and shall be evidenced by a written agreement in such
form as the Committee  shall from time to time approve,  which  agreement  shall
comply with and be subject to the following terms and conditions:

          (a)  Exercise  Price.  The  exercise  price for each  Option  shall be
          established at the sole  discretion of the Board;  provided,  however,
          that:

               (i) the exercise  price per share for an  Incentive  Stock Option
               shall be not less  than one  hundred  percent  (100%) of the fair
               market value,  as determined by the Board, of a share of Stock on
               the date of the granting of the Option;

               (ii) no Incentive  Stock Option granted to an Optionee who at the
               time the Option is granted  owns stock  possessing  more than ten
               percent (10%) of the total  combined  voting power of all classes
               of stock of a Participating Company within the meaning of Section
               422(b)(6) of the Code (a "Ten Percent Owner Optionee") shall have
               an  exercise  price per share less than one  hundred  ten percent
               (110%) of the fair market value, as determined by the Board, of a
               share  of  Stock  on the  date  of the  granting  of the  Option.
               Notwithstanding  the foregoing,  an Option may be granted with an
               exercise  price lower than the minimum  exercise  price set forth
               above if such  Option is granted  pursuant  to an  assumption  or
               substitution  for another option in a manner  qualifying with the
               provisions of Section 424(a) of the Code.

          (b) Exercise Period of Options. The Board shall have the power to set,
          including by  amendment  of an Option,  the time or times within which
          each  Option  shall be  exercisable  or the event or  events  upon the
          occurrence  of  which  all  or a  portion  of  each  Option  shall  be
          exercisable and the term of each Option;  provided,  however,  that no
          Option shall be  exercisable  after the  expiration of seven (7) years
          after the date such  Option is  granted.  No  Incentive  Stock  Option
          granted  to an  individual  who owns  stock  possessing  more than ten
          percent  (10%) of the total  combined  voting  power of all classes of
          stock of the Company,  as determined  under the stock  ownership rules
          specified  in  Subsection  2.1(c),  shall  be  exercisable  after  the
          expiration  of seven (7) years from the date on which  that  option is
          granted.

          (c)  Determination of Stock Ownership.  For purposes of determining in
          Subsections   2.1(a)  and  2.1(b)   whether  an  employee  owns  stock
          possessing  more than ten percent (10%) of the total  combined  voting
          power of all classes of stock of the  Company,  an  employee  shall be
          considered as owning the stock owned,  directly or  indirectly,  by or
          for his or her  brothers  and  sisters  (whether  by the whole or half
          blood),  spouse,  ancestors,  and  lineal  descendants.  Stock  owned,
          directly or indirectly, by or for a corporation,  partnership, estate,
          or trust shall be considered as being owned  proportionately by or for
          its shareholders,  partners,  or beneficiaries.  Stock with respect to
          which the employee holds an option shall not be counted.

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          (d) Right to  Exercise.  Each  Incentive  Stock  Option  shall  become
          exercisable and vest according to the terms and conditions established
          by the Board and  reflected in the written  agreement  evidencing  the
          option.   Notwithstanding  the  preceding  sentence,  all  outstanding
          Incentive Stock Options shall immediately  become  exercisable in full
          in the  event  that (i) the  shareholders  of the  Company  approve  a
          dissolution  or  liquidation  of  the  Company  or a  sale  of  all or
          substantially  all of the Company's  assets to another entity;  (ii) a
          tender within the meaning of section 14 of the Securities Exchange Act
          of 1934,  as  amended,  is made for five  percent  (5%) or more of the
          Company's  outstanding  capital  stock by any  person  other  than the
          Company or an affiliate;  or (iii) the Company effects an underwritten
          public offering of its securities pursuant to a registration statement
          filed under the  Securities Act of 1933.  Each Incentive  Stock Option
          shall be  subject to  termination  before  its date of  expiration  as
          provided in Subsection 2.1(e).

          (e) Termination of Employee Options. If an optionee who is an employee
          ceases to be an employee of the Company, his or her rights to exercise
          an Incentive Stock Option then held shall be only as follows:

               (i) Death. If an optionee dies while he or she is employed by the
               Company,  the optionee's estate shall have the right for a period
               of six (6) months (or such  longer  period as the  Committee  may
               determine  at the date of grant or during the term of the option)
               after the date of death to exercise  the option to the extent the
               optionee  was  entitled  to  exercise  the  option on that  date,
               provided the date of exercise is in no event after the expiration
               of the  term of the  option.  To the  extent  the  option  is not
               exercised  within  this  period,  the option will  terminate.  An
               optionee's    "estate"   shall   mean   the   optionee's    legal
               representative  or any person who  acquires the right to exercise
               an option by reason of the optionee's death.

               (ii)  Disability.  If an optionee's  employment  with the Company
               ends because the optionee becomes  disabled,  the optionee or his
               or her qualified  representative  (in the event of the optionee's
               mental  disability)  shall  have the right for a period of twelve
               (12)  months  after the date on which the  optionee's  employment
               ends to  exercise  the  option to the  extent  the  optionee  was
               entitled to exercise  the option on that date,  provided the date
               of exercise is in no event  after the  expiration  of the term of
               the option. To the extent the option is not exercised within this
               period, the option will terminate.

               (iii) Resignation.  If an optionee  voluntarily  resigns from the
               Company,  the  optionee  shall have the right for a period of two
               (2) months after the date of  resignation  to exercise the option
               to the extent the optionee was entitled to exercise the option on
               that date, provided the date of exercise is in no event after the
               expiration of the term of the option. To the extent the option is
               not exercised within this period, the option will terminate.

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<PAGE>
               (iv)  Termination  for Reasons other than Cause. If an optionee's
               employment  is  terminated  by the Company for reasons other than
               "Cause,"  the  optionee  shall have the right for a period of two
               (2) months after the date of  termination  to exercise the option
               to the extent the optionee was entitled to exercise the option on
               that date, provided the date of exercise is in no event after the
               expiration of the term of the option. To the extent the option is
               not exercised within this period, the option will terminate.  The
               termination  of an  optionee's  employment by the Company will be
               for reasons other than Cause if the  termination is NOT due to an
               act by the optionee  that is described  below under  "Termination
               for Cause."

               (v)  Termination  for  Cause.  If  an  optionee's  employment  is
               terminated  by the Company for "Cause,"  the optionee  shall have
               the  right  for a  period  of one (1)  month  after  the  date of
               termination to exercise the option to the extent the optionee was
               entitled to exercise  the option on that date,  provided the date
               of exercise is in no event  after the  expiration  of the term of
               the option. To the extent the option is not exercised within this
               period,  the  option  will  terminate.  For the  purpose  of this
               clause,  "Cause"  shall mean that:  the optionee is determined by
               the Committee to have  committed an act of  embezzlement,  fraud,
               dishonesty,  or breach of fiduciary  duty to the  Company,  or to
               have  deliberately  disregarded  the rules of the  Company  which
               resulted in loss,  damage,  or injury to the Company,  or because
               the optionee has made any  unauthorized  disclosure of any of the
               secrets or confidential  information of the Company,  has induced
               any client or customer of the Company to break any contract  with
               the Company,  has induced any principal for whom the Company acts
               as agent to terminate the agency relationship,  or has engaged in
               any conduct that constitutes unfair competition with the Company.

          (f) Notice of Sale. If an optionee sells or otherwise  disposes of any
          Shares  acquired  upon  exercise of an  Incentive  Stock  Option,  the
          optionee  shall  give the  Company  notice of the sale or  disposition
          within five business (5) days thereafter.

          (g) Other Reasons.  If an optionee's  employment with the Company ends
          for any reason not mentioned above in this Subsection 2(e), all rights
          of the optionee in an Incentive  Stock  Option,  to the extent that it
          has not been  exercised,  shall  terminate  30 days after the date the
          optionee's employment ends.

          (h) Limit on Exercise of Incentive  Stock Options.  To the extent that
          the aggregate fair market value  (determined as of the time the option
          is granted) of the Stock with respect to which Incentive Stock Options
          are  exercisable  for the  first  time by any  individual  during  any
          calendar  year  (under  all plans of the  Company  and its  parent and
          subsidiary   corporations)   exceeds  One  Hundred   Thousand  Dollars
          ($100,000),  the  options  shall be treated  as  options  that are not
          Incentive Stock Options.

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                                    ARTICLE 3

                            NONQUALIFIED STOCK OPTION

     3.1  Nonqualified  Stock Option Terms and  Conditions.  The options granted
under the terms and conditions of this Section 3 are nonqualified  stock options
and are not  intended  to  qualify  as  either a  qualified  stock  option or an
Incentive  Stock Option as those terms are defined by  applicable  provisions of
the Code.  Each  nonqualified  stock  option  granted  under  the Plan  shall be
authorized  by  action of the  Committee  and  shall be  evidenced  by a written
agreement in such form as the Committee  shall from time to time approve,  which
agreement  shall  comply  with  and  be  subject  to  the  following  terms  and
conditions:

          (a) Exercise  Price.  The exercise  price of each  nonqualified  stock
          option  shall not be less than eighty five  percent  (85%) of the fair
          market  value of a Share of the  Company  on the  date the  option  is
          granted; provided,  however, that the exercise price of a nonqualified
          stock option granted to an individual who owns stock  possessing  more
          than ten percent  (10%) of the  combined  voting power of the Company,
          its  parent,  or  subsidiaries  shall not be less than one hundred ten
          percent  (110%) of the fair market  value of a Share of the Company on
          the date the option is granted.

          (b) Exercise Period of Options. The Board shall have the power to set,
          including by  amendment  of an Option,  the time or times within which
          each  Option  shall be  exercisable  or the event or  events  upon the
          occurrence  of  which  all  or a  portion  of  each  Option  shall  be
          exercisable and the term of each Option;  provided,  however,  that no
          Option shall be  exercisable  after the  expiration of seven (7) years
          after the date such Option is granted.  No  nonqualified  stock option
          granted  to an  individual  who owns  stock  possessing  more than ten
          percent  (10%) of the total  combined  voting  power of all classes of
          stock of the Company,  as determined  under the stock  ownership rules
          specified  in  Subsection  3.1(c),  shall  be  exercisable  after  the
          expiration  of seven (7) years from the date on which  that  option is
          granted.

          (c)  Determination of Stock Ownership.  For purposes of determining in
          Subsections 3.1(a)and 3.1(b) whether an employee owns stock possessing
          more than ten percent (10%) of the total combined  voting power of all
          classes of stock of the Company,  an employee  shall be  considered as
          owning the stock owned,  directly or indirectly,  by or for his or her
          brothers  and sisters  (whether by the whole or half  blood),  spouse,
          ancestors,   and  lineal   descendants.   Stock  owned,   directly  or
          indirectly,  by or for a corporation,  partnership,  estate,  or trust
          shall be  considered  as  being  owned  proportionately  by or for its
          shareholders,  partners, or beneficiaries. Stock with respect to which
          the employee holds an option shall not be counted.

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          (d) Right to  Exercise.  Each  nonqualified  stock option shall become
          exercisable and vest according to the terms and conditions established
          by the Committee and reflected in the written agreement evidencing the
          option. Each nonqualified stock option shall be subject to termination
          before its date of expiration as provided in Subsection 3.1(e).

          (e)  Terminations of Options.  If an optionee ceases to be an employee
          of the  Company,  his or her rights to exercise a  nonqualified  stock
          option then held shall be only as follows:

               (i) Death. If an optionee dies while he or she is employed by the
               Company,  the optionee's estate shall have the right for a period
               of six (6) months (or such  longer  period as the  Committee  may
               determine  at the date of grant or during the term of the option)
               after the date of death to exercise  the option to the extent the
               optionee  was  entitled  to  exercise  the  option on that  date,
               provided the date of exercise is in no event after the expiration
               of the  term of the  option.  To the  extent  the  option  is not
               exercised  within  this  period,  the option will  terminate.  An
               optionee's    "estate"   shall   mean   the   optionee's    legal
               representative  or any person who  acquires the right to exercise
               an option by reason of the optionee's death.

               (ii)  Disability.  If an optionee's  employment  with the Company
               ends because the optionee becomes  disabled,  the optionee or his
               or her qualified  representative  (in the event of the optionee's
               mental  disability)  shall  have the right for a period of twelve
               (12)  months  after the date on which the  optionee's  employment
               ends to  exercise  the  option to the  extent  the  optionee  was
               entitled to exercise  the option on that date,  provided the date
               of exercise is in no event  after the  expiration  of the term of
               the option. To the extent the option is not exercised within this
               period, the option will terminate.

               (iii) Resignation.  If an optionee  voluntarily  resigns from the
               Company,  the  optionee  shall have the right for a period of two
               (2) months after the date of  resignation  to exercise the option
               to the extent the optionee was entitled to exercise the option on
               that date, provided the date of exercise is in no event after the
               expiration of the term of the option. To the extent the option is
               not exercised within this period, the option will terminate.

               (iv)  Termination  For Reasons Other Than Cause. If an optionee's
               employment  is  terminated  by the Company for reasons other than
               "Cause,"  the  optionee  shall have the right for a period of two
               (2) months after the date of  termination  to exercise the option
               to the extent the optionee was entitled to exercise the option on
               that date, provided the date of exercise is in no event after the
               expiration of the term of the option. To the extent the option is
               not exercised within this period, the option will terminate.  The
               termination  of an  optionee's  employment by the Company will be
               for reasons other than Cause if the  termination is NOT due to an
               act by the optionee  that is described  below under  "Termination
               for Cause."

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               (v)  Termination  For  Cause.  If  an  optionee's  employment  is
               terminated  by the Company for "Cause,"  the optionee  shall have
               the  right  for a  period  of one (1)  month  after  the  date of
               termination to exercise the option to the extent the optionee was
               entitled to exercise  the option on that date,  provided the date
               of exercise is in no event  after the  expiration  of the term of
               the option. To the extent the option is not exercised within this
               period,  the  option  will  terminate.  For the  purpose  of this
               clause,  "Cause"  shall mean that:  the optionee is determined by
               the Committee to have  committed an act of  embezzlement,  fraud,
               dishonesty,  or breach of fiduciary  duty to the  Company,  or to
               have  deliberately  disregarded  the rules of the  Company  which
               resulted in loss,  damage,  or injury to the Company,  or because
               the optionee has made any  unauthorized  disclosure of any of the
               secrets or confidential  information of the Company,  has induced
               any client or customer of the Company to break any contract  with
               the Company,  has induced any principal for whom the Company acts
               as agent to terminate the agency relationship,  or has engaged in
               any conduct that constitutes unfair competition with the Company.

                                    ARTICLE 4

                          NON-EMPLOYEE DIRECTOR OPTIONS

     4.1 Grants to  Non-Employee  Directors.  All options granted to nonemployee
directors shall be subject to the following terms and conditions:

          (a) Limits.  The aggregate  amount of Shares (as adjusted  pursuant to
          Section 6.2) subject to options granted to all  nonemployee  directors
          as a group shall not exceed  twenty  percent  (20%) of the Shares plus
          Shares underlying expired or terminated options that are added back to
          the number of Shares available under the Plan.

          (b)  Nonqualified  Options.  All stock options  granted to nonemployee
          directors pursuant to the Plan shall be nonqualified stock options.

          (c) Exercise  Price.  The exercise  price of each option  granted to a
          nonemployee  director  shall not be less than 85% of fair market value
          per Share;  provided,  however,  that the exercise  price of an option
          granted to a nonemployee  director who owns stock possessing more than
          ten percent  (10%) of the combined  voting  power of the Company,  its
          parent, or subsidiaries shall not be less than one hundred ten percent
          (110%) of the fair market  value of a Share of the Company on the date
          the option is granted.  The fair market  value of the Shares  shall be
          determined by the Board.

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          (d) Duration of Options. Each option granted to a nonemployee director
          shall be for a term determined by the Board;  provided,  however, that
          the term of any option may not exceed seven (7) years.

          (e) Right to Exercise.  Each option granted to a nonemployee  director
          shall  become   exercisable  and  vest  according  to  the  terms  and
          conditions  established  by the Board  and  reflected  in the  written
          agreement  evidencing the option. Each option granted to a nonemployee
          director shall be subject to termination before its date of expiration
          as provided in Subsection 4.1(f).

          (f) Terminations of Non-employee  Director Options.  If a non-employee
          director ceases to be a director of the Company,  his or her rights to
          exercise an option then held shall be only as follows:

               (i)  Death.  If a  nonemployee  director  dies while he or she is
               serving on the Board of the Company,  the director's estate shall
               have the  right for a period of six (6)  months  (or such  longer
               period as the  Committee  may  determine  at the date of grant or
               during  the  term of the  option)  after  the  date of  death  to
               exercise  the option to the extent the  director  was entitled to
               exercise  the option on that date,  provided the date of exercise
               is in no event after the expiration of the term of the option. To
               the extent the option is not  exercised  within this period,  the
               option  will  terminate.  A  director's  "estate"  shall mean the
               director's  legal  representative  or any person who acquires the
               right to exercise an option by reason of the director's death.

               (ii)  Disability.  If a nonemployee  director's  Board membership
               ends because the director becomes  disabled,  the director or his
               or her qualified  representative  (in the event of the director's
               mental  disability)  shall  have the right for a period of twelve
               (12)  months  after  the  date  on  which  the  director's  Board
               membership ends to exercise the option to the extent the director
               was  entitled to exercise  the option on that date,  provided the
               date of exercise is in no event after the  expiration of the term
               of the option.  To the extent the option is not exercised  within
               this period, the option will terminate.

               (iii) Resignation.  If a nonemployee director voluntarily resigns
               from the Company's Board, the director shall have the right for a
               period  of six  (6)  months  after  the  date of  resignation  to
               exercise  the option to the extent the  director  was entitled to
               exercise  the option on that date,  provided the date of exercise
               is in no event after the expiration of the term of the option. To
               the extent the option is not  exercised  within this period,  the
               option will terminate.

               (iv)  Termination  for Reasons other than Cause. If a nonemployee
               director's  Board  membership  is  terminated  by the Company for
               reasons other than "Cause," the director shall have the right for
               a period  of six (6)  months  after  the date of  termination  to

                                       10
<PAGE>
               exercise  the option to the extent the  director  was entitled to
               exercise  the option on that date,  provided the date of exercise
               is in no event after the expiration of the term of the option. To
               the extent the option is not  exercised  within this period,  the
               option  will   terminate.   The   termination  of  a  nonemployee
               director's  Board membership will be for reasons other than Cause
               if the  termination  is NOT due to an act by the director that is
               described below under "Termination for Cause."

               (v)  Termination  For Cause.  If a nonemployee  director's  Board
               membership is terminated by the Company for "Cause," the director
               shall have the right for a period of one (1) month after the date
               of  termination to exercise the option to the extent the director
               was  entitled to exercise  the option on that date,  provided the
               date of exercise is in no event after the  expiration of the term
               of the option.  To the extent the option is not exercised  within
               this period,  the option will terminate.  For the purpose of this
               clause,  "Cause"  shall mean that:  the director is determined by
               the Committee to have  committed an act of  embezzlement,  fraud,
               dishonesty,  or breach of fiduciary  duty to the  Company,  or to
               have  deliberately  disregarded  the rules of the  Company  which
               resulted in loss,  damage,  or injury to the Company,  or because
               the director has made any  unauthorized  disclosure of any of the
               secrets or confidential  information of the Company,  has induced
               any client or customer of the Company to break any contract  with
               the Company,  has induced any principal for whom the Company acts
               as agent to terminate the agency relationship,  or has engaged in
               any conduct that constitutes unfair competition with the Company.

               (vi) Other Reasons. If a nonemployee  director's Board membership
               ends  for any  reason  not  mentioned  above  in this  Subsection
               4.1(f),  all rights of the  director in an option,  to the extent
               that it has not been  exercised,  shall terminate on the date the
               director's Board membership ends.

                                    ARTICLE 5

                    STANDARD FORMS OF STOCK OPTION AGREEMENT

     5.1 Incentive Stock Options.  Unless otherwise provided for by the Board at
the time an Option is granted, an Option designated as an Incentive Stock Option
shall  comply with and be subject to the terms and  conditions  of an  Incentive
Stock Option Agreement which shall be in such form as designated by the Board of
Directors or Committee from time to time.

     5.2 Nonqualified Stock Options.  Unless otherwise provided for by the Board
at the time an Option is granted,  an Option designated as a Nonqualified  Stock
Option  shall  comply  with and be  subject  to the  terms and  conditions  of a
Nonqualified Stock Option Agreement which shall be in such form as designated by
the Board of Directors or Committee from time to time.

                                       11
<PAGE>
     5.3 Standard Term For Options.  Unless otherwise  provided for by the Board
in the grant of an Option, any Option granted hereunder shall be exercisable for
a term of seven (7) years.

     5.4 Authority To Vary Terms.  The Board shall have the authority  from time
to time to modify,  extend, renew or vary the terms of any of the standard forms
of Stock Option Agreement described in Article 6 below either in connection with
the  grant or  amendment  of an  individual  Option  or in  connection  with the
authorization of a new standard form or forms; provided, however, that the terms
and conditions of such revised or amended standard form or forms of stock option
agreement  shall be in  accordance  with the terms of the Plan.  Such  authority
shall  include,  but not by way of  limitation,  the  authority to grant Options
which are not immediately exercisable.

                                    ARTICLE 6

            ADDITIONAL TERMS AND CONDITIONS APPLICABLE TO ALL OPTIONS

     The  following  terms and  conditions  shall apply to all  options  granted
pursuant to the plan:

     6.1 Payment of Exercise Price.

          (a)  Excersise  of Options.  Optionees  may  exercise  options only by
          providing  written  notice to the Company at the address  specified in
          the  written  agreement  evidencing  the  option.  The notice  must be
          accompanied  by full  payment  in cash for the  Shares as to which the
          options are exercised.

          (b) Forms of Payment Authorized. Payment of the exercise price for the
          number of shares of Stock being purchased pursuant to any Option shall
          be made (i) in cash, by check, or cash  equivalent,  (ii) by tender to
          the Company of shares of the  Company's  stock  owned by the  Optionee
          having a fair market  value,  as  determined by the Board (but without
          regard to any restrictions on transferability applicable to such stock
          by reason of federal or state  securities  laws or agreements  with an
          underwriter for the Company),  not less than the exercise price, (iii)
          by the  assignment  of the  proceeds  of a sale  of some or all of the
          shares  being  acquired  upon the  exercise of the Option  (including,
          without limitation,  through an exercise complying with the provisions
          of  Regulation  T as  promulgated  from  time to time by the  Board of
          Governors of the Federal Reserve  System),  (iv) by the withholding of
          shares being acquired upon exercise of the Option having a fair market
          value,  as  determined  by  the  Board  (but  without  regard  to  any
          restrictions on transferability  applicable to such stock by reason of
          federal or state securities laws or agreements with an underwriter for
          the  Company),  not  less  than  the  exercise  price,  or  (v) by any
          combination  thereof.  The  Board may at any time or from time to time
          grant  Options  which  do not  permit  all of the  foregoing  forms of
          consideration to be used in payment of the exercise price and/or which
          otherwise restrict one (1) or more forms of consideration.

                                       12
<PAGE>
          (c) Tender of Company Stock.  Notwithstanding the foregoing, an Option
          may not be  exercised  by  tender  to the  Company  of  shares  of the
          Company's  stock to the extent such tender of stock,  as determined by
          the Board,  would constitute a violation of the provisions of any law,
          regulation   and/or  agreement   restricting  the  redemption  of  the
          Company's stock. Unless otherwise provided by the Board, an Option may
          not be exercised  by tender to the Company of shares of the  Company's
          stock unless such shares of the Company's stock either have been owned
          by the  Optionee  for more than six (6)  months or were not  acquired,
          directly  or  indirectly,  from  the  Company.  An  optionee  may also
          exercise an option by the delivery  and  surrender of Shares which (i)
          have been  owned by the  optionee  for at least six (6)  months or for
          such  other  period as the  Committee  may  require;  and (ii) have an
          aggregate  fair  market  value on the date of  surrender  equal to the
          exercise price. In addition,  an option may be exercised by delivering
          to the  Company  (i) an  exercise  notice  instructing  the Company to
          deliver the  certificates  for the Shares  purchased  to a  designated
          brokerage firm; and (ii) a copy of irrevocable  instructions delivered
          to the brokerage firm to sell the Shares acquired upon exercise of the
          option and to deliver to the Company from the sale proceeds sufficient
          cash  to pay the  exercise  price  and  applicable  withholding  taxes
          arising as a result of the exercise

          (d) Assignment of Proceeds of Sale. The Company  reserves,  at any and
          all times,  the right, in the Company's sole and absolute  discretion,
          to establish,  decline to approve and/or  terminate any program and/or
          procedures  for the exercise of Options by means of an  assignment  of
          the  proceeds  of a sale of some or all of the  shares  of Stock to be
          acquired upon such exercise.

     6.2 Adjustment of and Changes In Capitalization.

          (a) Changes in  Capitalization.  Subject to any required action by the
          shareholders  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,  as well as the  price per  Share  covered  by each
          outstanding option, shall be proportionately adjusted for any increase
          or  decrease  in the number of issued  Shares  resulting  from a stock
          split,   reverse  stock  split,   stock  dividend,   recapitalization,
          combination or  reclassification  of the Shares, or any other increase
          or decrease in the number of issued Shares effected without receipt of
          consideration by the Company;  provided,  however,  that conversion of
          any convertible  securities of the Company shall not be deemed to have
          been "effected  without  receipt of  consideration."  Such  adjustment
          shall be made by the Board of Directors,  whose  determination in that
          respect shall be final,  binding, and conclusive.  Except as expressly
          provided herein,  no issuance by the Company of shares of stock of any
          class,  or securities  convertible  into shares of stock of any class,
          shall affect,  and no adjustment by reason  thereof shall be made with
          respect  to, the number or price of Shares  subject to an option.

                                       13
<PAGE>
          (b)  Dissolution,  Liquidation,  Sale,  or  Merger.  In the event of a
          proposed   dissolution  or   liquidation   of  the  Company,   options
          outstanding  under the Plan  shall  terminate  immediately  before the
          consummation  of  such  proposed  action.  The  Board  will,  in  such
          circumstances, provide written notice to the optionees of the expected
          dates of termination of outstanding  options and  consummation  of the
          proposed  dissolution or liquidation.

               In the event of a proposed  sale of all or  substantially  all of
          the assets of the  Company,  or the merger of the Company with or into
          another  corporation  in a transaction in which the Company is not the
          surviving   corporation,   outstanding   options  may  be  assumed  or
          equivalent options may be substituted by the successor corporation (or
          a parent or  subsidiary  of the  successor  corporation),  unless  the
          successor  corporation  does not agree to  assume  the  options  or to
          substitute  equivalent options. If outstanding options are not assumed
          or substituted by equivalent  options,  all outstanding  options shall
          terminate  immediately  before the  consummation of the sale or merger
          (subject  to the actual  consummation  of the sale or merger)  and the
          Company shall provide  written notice to the optionees of the expected
          dates  of  termination  of  the  options  and   consummation   of  the
          transaction.  If  the  transaction  is  not  consummated,  unexercised
          options shall continue in accordance with their original terms.

          (c)  Notice of  Adjustments,  Fractional  Shares.  To the  extent  the
          foregoing  adjustments  relate to stock or  securities of the Company,
          such adjustments shall be made by the Committee,  whose  determination
          in that respect shall be final,  binding, and conclusive.  No right to
          purchase fractional shares shall result from any adjustment in options
          pursuant  to this  Section  6.2. In case of any such  adjustment,  the
          shares  subject to the option  shall be  rounded  down to the  nearest
          whole share. Notice of any adjustment shall be given by the Company to
          each  holder  of an  option  which  was in  fact so  adjusted  and the
          adjustment  (whether or not notice is given)  shall be  effective  and
          binding for all purposes of the Plan.

               No  adjustment  shall be made for  dividends  or other rights for
          which the record date is prior to the date of such issuance, except as
          provided in this Section 6.2.

               Any issue by the  Company  of shares  of stock of any  class,  or
          securities  convertible into shares of any class, shall not affect the
          number or price of Shares subject to the option,  and no adjustment by
          reason thereof shall be made.  The grant of an option  pursuant to the
          Plan shall not affect in any way the right or power of the  Company to
          make adjustments, reclassifications, reorganizations or changes of its
          capital or  business  structure  or to merge or to  consolidate  or to
          dissolve,  liquidate  or  sell,  or  transfer  all or any  part of its
          business or assets.

                                       14
<PAGE>
     6.3 Transfer of Control.  A "Transfer  of Control"  shall be deemed to have
occurred in the event any of the  following  occurs with respect to the Company:

          (a) the  acquisition  of direct or indirect  ownership of stock by any
          person,  entity or group of  persons  or  entities  acting in  concert
          possessing  more than a majority  of the  beneficial  interest  in the
          voting stock of the Company;

          (b) the direct or indirect sale or exchange by the stockholders of the
          Company of all or substantially  all of the stock of the Company where
          the  stockholders  of the Company  before such sale or exchange do not
          retain, directly or indirectly,  at least a majority of the beneficial
          interest  in the  voting  stock  of the  Company  after  such  sale or
          exchange;

          (c) a merger or  consolidation  where the  stockholders of the Company
          before  such  merger  or  consolidation  do not  retain,  directly  or
          indirectly,  at least a majority  of the  beneficial  interest  in the
          voting stock of the Company after such merger or consolidation;

          (d) the sale,  exchange,  or transfer of all, or substantially all, of
          the assets of the Company other than a sale, exchange,  or transfer to
          one (1) or more subsidiary of the Company; or

          (e) a liquidation or  dissolution of the Company.  For purposes of the
          foregoing, if a group of persons or entities begins to act in concert,
          and if such group  meets the  beneficial  ownership  requirements  set
          forth in clause (a) above,  then such  acquisition  shall be deemed to
          have  occurred on the date the  Company  first  becomes  aware of such
          group or its actions.

          (f) a Stock  Option  Agreement  may, in the  discretion  of the Board,
          provide for accelerated vesting in the event of a Transfer of Control.
          In the event of a Transfer  of  Control,  the  surviving,  continuing,
          successor, or purchasing corporation or parent corporation thereof, as
          the case may be (the "Acquiring Corporation"), shall either assume the
          Company's  rights  and  obligations  under  outstanding  stock  option
          agreements or substitute options for the Acquiring Corporation's stock
          for such outstanding  Options. In the event the Acquiring  Corporation
          elects not to assume or  substitute  for such  outstanding  Options in
          connection  with the  Transfer of Control,  any  unexercisable  and/or
          unvested shares subject to such  outstanding  stock option  agreements
          shall be  immediately  exercisable  and  fully  vested  as of the date
          thirty (30) days prior to the proposed  effective date of the Transfer
          of  Control.  The  exercise  and/or  vesting  of any  Option  that was
          permissible  solely by reason of this Section 6.3 shall be conditioned
          upon the  consummation  of the Transfer of Control.  Any Options which
          are neither assumed or substituted for by the Acquiring Corporation in
          connection  with the Transfer of Control nor  exercised as of the date
          of the Transfer of Control shall terminate and cease to be outstanding
          effective as of the date of the Transfer of Control.

                                       15
<PAGE>
     6.4 Options  Non-Transferable.  During the  lifetime of the  Optionee,  the
Option shall be exercisable only by the Optionee.  No Option shall be assignable
or  transferable  by the Optionee,  except by will or by the laws of descent and
distribution.  In  addition,  in order for  Shares  acquired  upon  exercise  of
Incentive Stock Options to receive the tax treatment  afforded such Shares,  the
Shares may not be disposed of within two years from the date of the option grant
nor within one year after the date of transfer of such Shares to the optionee.

     6.5 Termination or Amendment of Plan or Options.  The Board,  including any
duly  appointed  committee of the Board,  may terminate or amend the Plan or any
Option  at any  time;  provided,  however,  that  without  the  approval  of the
Company's  stockholders,  there shall be (a) no increase in the total  number of
shares of Stock  covered by the Plan (except by operation of the  provisions  of
Section 6.2  above),  (b) no change in the class  eligible to receive  Incentive
Stock  Options,   and  (c)  no  expansion  in  the  class  eligible  to  receive
nonqualified  stock options.  In addition to the foregoing,  the approval of the
Company's  stockholders  shall be sought for any amendment to the Plan for which
the Board  deems  stockholder  approval  necessary  in order to comply with Rule
16b-3.  In any event,  no amendment  may adversely  affect any then  outstanding
Option or any unexercised portion thereof,  without the consent of the Optionee,
unless such amendment is required to enable an Option designated as an Incentive
Stock Option to qualify as an Incentive Stock Option.

     The Plan, unless sooner  terminated,  shall terminate on December 14, 2006,
seven (7) years from the date the Plan was originally  adopted by the Board.  An
option may not be granted under the Plan after the Plan is terminated.

     6.6  Information  to Optionees.  The Company shall provide to each Optionee
during  the  period  for  which he or she has one or more  outstanding  options,
copies of all annual  reports  and all other  information  which is  provided to
shareholders  of the Company.  The Company shall not be required to provide such
information to key employees  whose duties in connection with the Company assure
their access to equivalent information.

     6.7 Privileges of Stock Ownership,  Securities Law Compliance.  No Optionee
shall be  entitled to the  privileges  of stock  ownership  as to any Shares not
actually issued and delivered to the Optionee.  The exercise of any option under
the Plan shall be conditioned  upon the  registration of the Shares with the SEC
and  qualification  of the options and  underlying  Shares under the  California
securities laws, unless in the opinion of counsel to the Company registration or
qualification is not necessary.  The Company shall diligently endeavor to comply
with all  applicable  securities  laws before any options are granted  under the
Plan and before any Shares are issued pursuant to the exercise of such options.

     6.8 Limitation of Rights.

          (a) No Right to an Option.  Nothing in the Plan shall be  construed to
          give any employee or any nonemployee director of the Company any right
          to be granted an option.

          (b) No  Employment  Rights.  Neither  the Plan nor the  granting of an
          option  nor  any  other  action  taken  pursuant  to  the  Plan  shall
          constitute or be evidence of any agreement or  understanding,  express

                                       16
<PAGE>
          or  implied,  that the  Company  will  employ  or  continue  the Board
          membership  of an optionee for any period of time, or in any position,
          or at any particular rate of compensation.

                                    ARTICLE 7

                            MISCELLANEOUS PROVISIONS

     7.1 Effective Date of Plan. The Plan will become effective upon approval by
the  Company's  shareholders  within  twelve (12) months of the date the Plan is
adopted by the Company's  Board of  Directors.  Options may be granted under the
Plan at any time after the Plan becomes  effective and before the termination of
the Plan.

     7.2  Indemnification.  To the extent  permitted by applicable law in effect
from time to time, no member of the Board or the  Committee  shall be liable for
any action or omission of any other member of the Board or Committee nor for any
act or  omission on the  member's  own part,  excepting  only the  member's  own
willful misconduct or gross negligence.  The Company shall pay expenses incurred
by, and satisfy a judgment  or fine  rendered  or levied  against,  a present or
former  director or member of the  Committee  in any action  against such person
(whether or not the Company is joined as a party  defendant) to impose liability
or a penalty on such  person for an act alleged to have been  committed  by such
person while a director or member of the  Committee  arising with respect to the
Plan or  administration  thereof or out of membership on the Committee or by the
Company,  or all or any  combination of the preceding;  provided the director or
Committee  member  was  acting  in good  faith,  within  what such  director  or
Committee member reasonably believed to have been within the scope of his or her
employment or authority and for a purpose which he or she reasonably believed to
be in the best interests of the Company or its shareholders. Payments authorized
hereunder include amounts paid and expenses incurred in settling any such action
or threatened  action.  This section does not apply to any action  instituted or
maintained  in the right of the Company by a  shareholder  or holder of a voting
trust  certificate  representing  shares of the Company.  The provisions of this
section shall apply to the estate, executor,  administrator,  heirs, legatees or
devisees of a director or  Committee  member,  and the term  "person" as used in
this section shall include the estate, executor, administrator,  heirs, legatees
or devisees of such person.

     7.3 Withholding. The Company shall have the right to condition the issuance
of Shares  upon  exercise  of an option  upon  payment  by the  optionee  of any
applicable taxes required to be withheld under federal,  state or local tax laws
or regulations in connection  with the exercise.  To the extent  permitted in an
optionee's stock option agreement,  an optionee may elect to pay such tax by (i)
requesting the Company to withhold a sufficient  number of Shares from the total
number of Shares  issuable  upon  exercise  of the option or (ii)  delivering  a
sufficient  number of Shares  which have been held by the  optionee for at least
six (6)  months (or such  other  period as the  Committee  may  require)  to the
Company.  This election is subject to approval or  disapproval by the Committee.
The value of Shares  withheld or delivered shall be the fair market value of the
Shares on the date the exercise becomes taxable as determined by the Committee.

                                       17
<PAGE>
     7.4 Further  Assurances.  All parties to this Plan agree to perform any and
all further acts and to execute and deliver any documents that may reasonably be
necessary to carry out the provisions of this Plan.

     7.5 Attorneys' Fees. In any legal action or other proceeding brought by any
party to enforce or interpret the terms of this Plan, the prevailing party shall
be entitled to recover reasonable attorneys' fees and costs.

     7.6 Governing Law. The Plan and all  determinations  made and actions taken
pursuant  hereto,  to the  extent  not  otherwise  governed  by the  Code or the
securities laws of the United States,  shall be governed by the law of the State
of California.

     7.7  Notices.  Any  written  notice to the  Company  required by any of the
provisions of the Plan shall be addressed to the chief  personnel  officer or to
the chief executive  officer of the Company,  and shall become effective when it
is received by the office of the chief personnel  officer or the chief executive
officer.

     7.8 Entire  Agreement.  This Plan,  together with those  documents that are
referenced in the Plan,  are intended to be the final,  complete,  and exclusive
statement of the terms of the  agreement  between  Employee and the Company with
regard to the subject matter of this Plan.  This Agreement  supersedes all other
prior  agreements,  communications,  and  statements,  whether  written or oral,
express or implied,  pertaining  to that  subject  matter.  This Plan may not be
contradicted  by  evidence  of  any  prior  or  contemporaneous   statements  or
agreements,  oral or  written,  and  may not be  explained  or  supplemented  by
evidence of consistent additional terms. This Plan does not effect the terms and
conditions  of any options  granted by the Company prior to the date of adoption
of this Plan by the Board of Directors.

     7.9 Successors and Assigns.  Optionee agrees that he will not assign, sell,
transfer,   delegate,   or  otherwise   dispose  of,   whether   voluntarily  or
involuntarily,  or by  operation of law,  any rights or  obligations  under this
Plan, except as expressly permitted by this Plan. Any such purported assignment,
sale, transfer, delegation, or other disposition shall be null and void. Subject
to the  limitations  set forth in this  Plan,  the Plan  shall be binding on and
inure to the  benefit  of the  successors  and  assigns of the  Company  and any
successors  and permitted  assigns of Employee,  including any of his executors,
administrators, or other legal representatives.  It shall not benefit any person
or entity other than those specifically enumerated in this Agreement.

     7.10 Severability. If any provision of this Plan, or its application to any
person, place, or circumstance, is held by an arbitrator or a court of competent
jurisdiction  to be invalid,  unenforceable,  or void,  that provision  shall be
enforced to the greatest  extent  permitted  by law,  and the  remainder of this
Agreement and of that provision shall remain in full force and effect as applied
to other persons, places, and circumstances.


                                       18
<PAGE>
     7.11 Interpretation.  This Plan shall be construed as a whole, according to
its fair  meaning,  and not in favor of or against any party.  By way of example
and not in  limitation,  this Plan shall not be  construed in favor of the party
receiving  a benefit  nor  against  the  party  responsible  for any  particular
language in this Plan.  Captions are used for reference purposes only and should
be ignored  in the  interpretation  of the Plan.  Unless  the  context  requires
otherwise,  all  references in this Plan to Paragraphs  are to the paragraphs of
this Plan.

     The  undersigned  hereby  certify that the foregoing  Stock Option Plan was
duly adopted and approved by the Board of Directors on December 15, 1999.




/S/ D. Scott Elder                           Allen D. Hardman
----------------------------------           -----------------------------------
D. Scott Elder                               Allen D. Hardman
Chairman of the Board & CEO                  Vice-President


                                       19