DFG HOLDINGS, INC.

                              STOCK INCENTIVE PLAN



      1. Purpose. DFG Holdings, Inc., a Delaware corporation (the "Company"),
hereby adopts the DFG Holdings, Inc. Stock Incentive Plan (the "Plan"). The Plan
is intended to recognize the contributions made to the Company by employees
(including employees who are members of the Board of Directors) of the Company
or any Affiliate, to provide such persons with additional incentive to devote
themselves to the future success of the Company or an Affiliate, and to improve
the ability of the Company or an Affiliate to attract, retain, and motivate
individuals upon whom the Company's sustained growth and financial success
depend, by providing such persons with an opportunity to acquire or increase
their proprietary interest in the Company through receipt of rights to acquire
the Company's Common Stock, par value of $.001 per share (the "Common Stock"),
and through the transfer or issuance of Common Stock. In addition, the Plan is
intended as an additional incentive to directors of the Company who are not
employees of the Company or an Affiliate to serve on the Board of Directors and
to devote themselves to the future success of the Company by providing them with
an opportunity to acquire or increase their proprietary interest in the Company
through the receipt of rights to acquire Common Stock. Furthermore, the Plan may
be used to encourage consultants and advisors of the Company to further the
success of the Company.

      2. Definitions. Unless the context clearly indicates otherwise, the
following terms shall have the following meanings:

            (a) "Act" means the Securities Act of 1933.

            (b) "Affiliate" means a corporation which is a parent corporation or
a subsidiary corporation with respect to the Company within the meaning of
Section 424(e) or (f) of the Code.

            (c) "Award" shall mean a transfer of Common Stock made pursuant to
the terms of the Plan.

            (d) "Award Agreement" shall mean the agreement between the Company
and a Grantee with respect to an Award made pursuant to the Plan.

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

            (f) "Change of Control" shall have the meaning as set forth in 
Section 9 of the Plan.

            (g) "Code" means the Internal Revenue Code of 1986, as amended.

            (h) "Committee" shall have the meaning set forth in Section 3 of the
Plan.

            (i) "Common Stock" shall have the meaning set forth in Section 1 of
the Plan.

            (j) "Company" means DFG Holdings, Inc., a Delaware corporation.

            (k) "Disability" shall have the meaning set forth in Section
22(e)(3) of the Code.

            (l) "Employee" means an employee of the Company or an Affiliate.

            (m) "Exchange Act" means the Securities Exchange Act of 1934, as
amended.

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            (n) "Fair Market Value" shall have the meaning set forth in
Subsection 8(b) of the Plan.

            (o) "Grantee" shall mean a person to whom an Award has been granted
pursuant to the Plan.

            (p) "ISO" means an Option granted under the Plan which is intended
to qualify as an "incentive stock option" within the meaning of Section 422(b)
of the Code.

            (q) "Non-qualified Stock Option" means an Option granted under the
Plan which is not intended to qualify, or otherwise does not qualify, as an
"incentive stock option" within the meaning of Section 422(b) of the Code.

            (r) "Option" means either an ISO or a Non-qualified Stock Option
granted under the Plan.

            (s) "Optionee" means a person to whom an Option has been granted
under the Plan, which Option has not been exercised and has not expired or
terminated.

            (t) "Option Document" means the document described in Section 8 of
the Plan, as applicable, which sets forth the terms and conditions of each grant
of Options.

            (u) "Option Price" means the price at which Shares may be purchased
upon exercise of an Option, as calculated pursuant to Subsection 8(b) of the
Plan.

            (v) "SAR" shall have the meaning set forth in Section 11 of the
Plan.

            (w) "Shares" means the shares of Common Stock of the Company which
are the subject of Options or granted as Awards under the Plan.

      3. Administration of the Plan. The Board of Directors or a committee
designated by it shall operate and administer the Plan. Any committee designated
by the Board of Directors, and the Board of Directors itself in its
administrative capacity with respect to the Plan, is referred to herein as the
"Committee." The provisions set forth herein, as it pertains to members of the
Committee, may be administered by the Board of Directors.

            (a) Meetings. The Committee shall hold meetings at such times and
places as it may determine, shall keep minutes of its meetings, and shall adopt,
amend and revoke such rules or procedures as it may deem proper; provided,
however, that it may take action only upon the agreement of a majority of the
whole Committee. Any action which the Committee shall take through a written
instrument signed by a majority of its members shall be as effective as though
it had been taken at a meeting duly called and held.

            (b) Exculpation. No member of the Board of Directors shall be
personally liable for monetary damages for any action taken or any failure to
take any action in connection with the administration of the Plan or the
granting of Options under the Plan, provided that this Subsection 3(b) shall not
apply to (i) any breach of such member's duty of loyalty to the Company, an
Affiliate, or the Company's stockholders, (ii) acts or omissions not in good
faith or involving intentional misconduct or a knowing violation of law, (iii)
acts or omissions that would result in liability under applicable law, and (iv)
any transaction from which the member derived an improper personal benefit.

            (c) Indemnification. Each member of the Committee shall be entitled,
without further act on his or her part, to indemnity from the Company and
limitation of liability to the fullest extent provided by applicable law and by
the Company's Certificate of Incorporation and/or By-laws in connection with or
arising out of any action, suit or proceeding with respect to the administration
of the Plan or the granting of Options thereunder in which he or she may be
involved by reason of his or her being or having been a member of the

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Committee, whether or not he or she continues to be such member of the Committee
at the time of the action, suit or proceeding.

            (d) Interpretation. The Committee shall have the power and authority
to interpret the Plan and to adopt rules and regulations for its administration
that are not inconsistent with the express terms of the Plan. Any such actions
by the Committee shall be final, binding and conclusive on all parties in
interest.

      4. Grants under the Plan. Grants under the Plan may be in the form of a
Non-qualified Stock Option, an ISO or a combination thereof, at the discretion
of the Committee.

      5. Eligibility. All Employees, members of the Board of Directors and
consultants and advisors to the Company shall be eligible to receive Options and
Awards hereunder. Consultants and advisors shall be eligible only if they render
bona fide services to the Company unrelated to the offer or sale of securities;
provided, however, that the limitation contained in this sentence shall not
apply to the extent that the inapplicability of such limitation will not
disqualify the Common Stock from being eligible for registration on Form S-8 (or
any successor form) under the Act. The Committee, in its sole discretion, shall
determine whether an individual qualifies as an employee.

      6. Shares Subject to Plan. The aggregate maximum number of Shares for
which Awards or Options may be granted pursuant to the Plan is five hundred
(500). The number of Shares which may be issued under the Plan shall be further
subject to adjustment in accordance with Section 10. The Shares shall be issued
from authorized and unissued Common Stock or Common Stock held in or hereafter
acquired for the treasury of the Company. If an Option terminates or expires
without having been fully exercised for any reason or if Shares subject to an
Award have been conveyed back to the Company pursuant to the terms of an Award
Agreement, the Shares for which the Option was not exercised or the Shares that
were conveyed back to the Company may again be the subject of one or more
Options or Awards granted pursuant to the Plan.

      7. Term of the Plan. The Plan is effective as of April 2, 1997, the date
on which it was adopted by the Board of Directors, subject to the approval of
the Plan within one year after such date by the stockholders in the manner
required by state law. If the Plan is not so approved by the stockholders, all
ISO's granted under the Plan shall be null and void. No ISO may be granted under
the Plan after April 1, 2007.

      8. Option Documents and Terms. Each Option granted under the Plan shall be
a Non-qualified Stock Option unless the Option shall be specifically designated
at the time of grant to be an ISO for Federal income tax purposes. If any Option
designated an ISO is determined for any reason not to qualify as an incentive
stock option within the meaning of Section 422 of the Code, such Option shall be
treated as a Nonqualified Stock Option for all purposes under the provisions of
the Plan. Options granted pursuant to the Plan shall be evidenced by the Option
Documents in such form as the Committee shall from time to time approve, which
Option Documents shall comply with and be subject to the following terms and
conditions and such other terms and conditions as the Committee shall from time
to time require which are not inconsistent with the terms of the Plan.

            (a) Number of Option Shares. Each Option Document shall state the
number of Shares to which it pertains. An Optionee may receive more than one
Option, which may include Options which are intended to be ISO's and Options
which are not intended to be ISO's, but only on the terms and subject to the
conditions and restrictions of the Plan.

            (b) Option Price. Each Option Document shall state the Option Price
which, for a Nonqualified Stock Option, may be less than, equal to, or greater
than the Fair Market Value of the Shares on the date the Option is granted and,
for an ISO, shall be at least 100% of the Fair Market Value of the Shares on the
date the Option is granted as determined by the Committee in accordance with
this Subsection 8(b); provided, however, that if an ISO is granted to an
Optionee who then owns, directly or by attribution under Section 424(d) of the
Code, shares possessing more than ten percent of the total combined voting power
of all classes of stock of the Company or an Affiliate, then the Option Price
shall be at least 110% of the Fair Market Value of the Shares on the date the
Option is granted. If the Common Stock is traded in a public

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market, then the Fair Market Value per share shall be, if the Common Stock is
listed on a national securities exchange or included in the NASDAQ System, the
last reported sale price thereof on the relevant date, or, if the Common Stock
is not so listed or included, the mean between the last reported "bid" and
"asked" prices thereof on the relevant date, as reported on NASDAQ or, if not so
reported, as reported by the National Daily Quotation Bureau, Inc. or as
reported in a customary financial reporting service, as applicable and as the
Committee determines. If the Common Stock is not traded in a public market, Fair
Market Value shall be determined in good faith by the Committee.

            (c) Exercise. No Option shall be deemed to have been exercised prior
to the receipt by the Company of written notice of such exercise and (unless
arrangements satisfactory to the Company have been made for payment through a
broker in accordance with procedures permitted by Regulation P of the Federal
Reserve Board) of payment in full of the Option Price for the Shares to be
purchased. Each such notice shall specify the number of Shares to be purchased
and shall (unless the Shares are covered by a then current registration
statement or a Notification under Regulation A under the Act), contain the
Optionee's acknowledgment in form and substance satisfactory to the Company that
(a) such Shares are being purchased for investment and not for distribution or
resale (other than a distribution or resale which, in the opinion of counsel
satisfactory to the Company, may be made without violating the registration
provisions of the Act), (b) the Optionee has been advised and understands that
(i) the Shares have not been registered under the Act and are "restricted
securities" within the meaning of Rule 144 under the Act and are subject to
restrictions on transfer and (ii) the Company is under no obligation to register
the Shares under the Act or to take any action which would make available to the
Optionee any exemption from such registration, (c) such Shares may not be
transferred without compliance with all applicable federal and state securities
laws, and (d) an appropriate legend referring to the foregoing restrictions on
transfer and any other restrictions imposed under the Option Documents may be
endorsed on the certificates. Notwithstanding the foregoing, if the Company
determines that issuance of Shares should be delayed pending (A) registration
under federal or state securities laws, (B) the receipt of an opinion of counsel
satisfactory to the Company that an appropriate exemption from such registration
is available, (C) the listing or inclusion of the Shares on any securities
exchange or an automated quotation system or (D) the consent or approval of any
governmental regulatory body whose consent or approval is necessary in
connection with the issuance of such Shares, the Company may defer exercise of
any Option granted hereunder until any of the events described in this sentence
has occurred.

            (d) Medium of Payment. Subject to the terms of the applicable Option
Document, an Optionee shall pay for Shares (i) in cash, (ii) by certified or
cashier's check payable to the order of the Company, or (iii) by such other mode
of payment as the Committee may approve, including payment through a broker in
accordance with procedures permitted by Regulation P of the Federal Reserve
Board. The Optionee may also exercise the Option in any manner contemplated by
Section 11. Furthermore, the Committee may provide in an Option Document that
payment may be made in whole or in part in shares of the Company's Common Stock
held by the Optionee. If payment is made in whole or in part in shares of the
Company's Common Stock, then the Optionee shall deliver to the Company
certificates registered in the name of such Optionee representing the shares
owned by such Optionee, free of all liens, claims and encumbrances of every kind
and having an aggregate Fair Market Value on the date of delivery that is at
least as great as the Option Price of the Shares (or relevant portion thereof)
with respect to which such Option is to be exercised by the payment in shares of
Common Stock, endorsed in blank or accompanied by stock powers duly endorsed in
blank by the Optionee. In the event that certificates for shares of the
Company's Common Stock delivered to the Company represent a number of shares in
excess of the number of shares required to make payment for the Option Price of
the Shares (or relevant portion thereof) with respect to which such Option is to
be exercised by payment in shares of Common Stock, the stock certificate or
certificates issued to the Optionee shall represent (i) the Shares in respect of
which payment is made, and (ii) such excess number of shares. Notwithstanding
the foregoing, the Committee may impose from time to time such limitations and
prohibitions on the use of shares of the Common Stock to exercise an Option as
it deems appropriate.

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            (e) Termination of Options.

                  (i) No Option shall be exercisable after the first to occur of
the following:

                        (A) Expiration of the Option term specified in the
Option Document, which, in the case of an ISO, shall not occur after (1) ten
years from the date of grant, or (2) five years from the date of grant if the
Optionee on the date of grant owns, directly or by attribution under Section
424(d) of the Code, shares possessing more than ten percent (10%) of the total
combined voting power of all classes of stock of the Company or of an Affiliate;

                        (B) Except to the extent otherwise provided in an
Optionee's Option Document, a finding by the Committee, after full consideration
of the facts presented on behalf of both the Company and the Optionee, that the
Optionee has been engaged in disloyalty to the Company or an Affiliate,
including, without limitation, fraud, embezzlement, theft, commission of a
felony or proven dishonesty in the course of the Optionee's employment or
service, or has disclosed trade secrets or confidential information of the
Company or an Affiliate. In such event, in addition to immediate termination of
the Option, the Optionee shall automatically forfeit all Shares for which the
Company has not yet delivered the share certificates upon refund by the Company
of the Option Price. Notwithstanding anything herein to the contrary, the
Company may withhold delivery of share certificates pending the resolution of
any inquiry that could lead to a finding resulting in a forfeiture;

                        (C) The date, if any, set by the Board of Directors as
an accelerated expiration date in the event of the liquidation or dissolution of
the Company;

                        (D) The occurrence of such other event or events as may
be set forth in the Option Document as causing an accelerated expiration of the
Option; or

                        (E) Except as otherwise set forth in the Option Document
and subject to the foregoing provisions of this Subsection 8(e), three months
after the Optionee's employment or service with the Company or its Affiliates
terminates for any reason other than Disability or death or one year after such
termination due to Optionee's Disability or death. With respect to this
Subsection 8(e)(i)(E), the only Options that may be exercised during the
three-month or one-year period, as the case may be, are Options which were
exercisable on the last date of such employment or service and not Options
which, if the Optionee were still employed or rendering service during such
three-month or one-year period, would become exercisable, unless the Option
Document specifically provides to the contrary. The terms of an executive
severance agreement or other agreement between the Company and an Optionee,
approved by the Committee, whether entered into prior or subsequent to the grant
of an Option, which provide for Option exercise dates later than those set forth
in Subsection 8(e)(i) shall be deemed to be Option terms approved by the
Committee and consented to by the Optionee.

                  (ii) Notwithstanding the foregoing, the Committee may extend
the period during which all or any portion of an Option may be exercised to a
date no later than the Option term specified in the Option Document pursuant to
Subsection 8(e)(i)(A), provided that any change pursuant to this Subsection
8(e)(ii) which would cause an ISO to become a Non-qualified Stock Option may be
made only with the consent of the Optionee.

                  (iii) Notwithstanding anything to the contrary contained in
the Plan or an Option Document, an ISO shall be treated as a Non-qualified Stock
Option to the extent such ISO is exercised at any time after the expiration of
the time period permitted under the Code for the exercise of an ISO.

            (f) Transfers. No Option granted under the Plan may be transferred,
except by will or by the laws of descent and distribution except as otherwise
set forth in the Option Document or to the extent that the Committee otherwise
determines.

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            (g) Limitation on ISO Grants. To the extent that the aggregate fair
market value of the shares of Common Stock (determined at the time the ISO is
granted) with respect to which ISO's under all incentive stock option plans of
the Company or its Affiliates are exercisable for the first time by the Optionee
during any calendar year exceeds $100,000, such ISO's shall, to the extent of
such excess, be treated as Nonqualified Stock Options.

            (h) Other Provisions. Subject to the provisions of the Plan, the
Option Documents shall contain such other provisions including, without
limitation, provisions authorizing the Committee to accelerate the
exercisability of all or any portion of an Option granted pursuant to the Plan,
rights of redemption by the Company, additional restrictions or conditions prior
to or upon the exercise of the Option or additional limitations upon the term of
the Option, as the Committee shall deem advisable.

            (i) Amendment. Subject to the provisions of the Plan, the Committee
shall have the right to amend any Option Document or Award Agreement issued to
an Optionee or Award holder, subject to the Optionee's or Award holder's consent
if such amendment is not favorable to the Optionee or Award holder, or if such
amendment has the effect of changing an ISO to a Non-Qualified Stock Option,
except that the consent of the Optionee or Award holder shall not be required
for any amendment made pursuant to Subsection 8(e)(i)(C) or Section 9 of the
Plan, as applicable.

       9. Change of Control. In the event of a Change of Control, the Committee
may take whatever actions it deems necessary or desirable with respect to any of
the Options outstanding which need not be treated identically, including,
without limitation, accelerating (a) the expiration or termination date in the
respective Option Documents to a date no earlier than thirty (30) days after
notice of such acceleration is given to the Optionees, or (b) the exercisability
of the Option. Notwithstanding the foregoing, in the event of a Change of
Control, Options granted pursuant to the Plan will become automatically
exercisable in full but only with respect to those Optionees who, in the good
faith determination of the Board of Directors, are likely to have their
relationship with the Company or any Affiliate of the Company terminated
(including constructive termination through a significant decrease in authority,
responsibility or overall total compensation) as a result of such Change of
Control.

            A "Change of Control" shall be deemed to have occurred upon the
earliest to occur of the following events:

      (i) W.G. Corporate Development Associates IV, L.P. and W.G. Corporate
Development Associates IV (Overseas), Ltd., collectively, shall cease to own
equity securities having at least 51% of the voting power of Holdings other than
by reason of, or as a result of, a public offering of Holdings' shares;
provided, however, that shares of Holdings held by (i) any liquidating trust for
either of said parties, (ii) the partners or stockholders of either of said
parties, (iii) the partners or stockholders of either of said parties in the
event of the liquidation of such parties, or (iv) any venture capital or
management buy out fund sponsored by Weiss, Peck & Greer shall not be deemed to
constitute a Change of Control for the purposes of this subparagraph (i); or

      (ii) the Company becomes a subsidiary of another unaffiliated corporation
or shall be merged or consolidated into another unaffiliated corporation.

      10. Adjustments on Changes in Capitalization.

            (a) In the event that the outstanding Shares are changed by reason
of a reorganization, merger, consolidation, recapitalization, reclassification,
stock split-up, combination or exchange of shares and the like (not including
the issuance of Common Stock on the conversion of other securities of the
Company which are outstanding on the date of grant and which are convertible
into Common Stock) or dividends payable in Shares, an equitable adjustment shall
be made by the Committee in the aggregate number of shares available under the
Plan and in the number of Shares and price per Share subject to outstanding
Options. Unless the Committee makes other provisions for the equitable
settlement of outstanding Options, if the Company shall be reorganized,
consolidated, or merged with another corporation or other legal entity,

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or if all or substantially all of the assets of the Company shall be sold or
exchanged, an Optionee shall at the time of issuance of the stock under such
corporate event be entitled to receive upon the exercise of his or her Option
the same number and kind of shares of stock or the same amount of property, cash
or securities as he or she would have been entitled to receive upon the
occurrence of any such corporate event as if he or she had been, immediately
prior to such event, the holder of the number of Shares covered by his or her
Option.

            (b) Any adjustment under this Section 10 in the number of Shares
subject to Options shall apply proportionately to only the unexercised portion
of any Option granted hereunder. If fractions of a Share would result from any
such adjustment, the adjustment shall be revised to the next lower whole number
of Shares.

            (c) The Committee shall have authority to determine the adjustments
to be made under this Section, and any such determination by the Committee shall
be final, binding and conclusive.

      11.   Stock Appreciation Rights (SARs).

            (a) In General. Subject to the terms and conditions of the Plan, the
Committee may, in its sole and absolute discretion, grant to an Optionee the
right to surrender an Option to the Company, in whole or in part, and to receive
in exchange therefor payment by the Company of an amount equal to the excess of
the Fair Market Value of the shares of Common Stock subject to such Option, or
portion thereof, so surrendered (determined in the manner described in section
8(b) as of the date the SARs are exercised) over the exercise price to acquire
such shares (which right shall be referred to as an "SAR"). Except as may
otherwise be provided in an Option Document, such payment may be made, as
determined by the Committee in accordance with subsection 11(c) below and set
forth in the Option Document, either in shares of Common Stock or in cash or in
any combination thereof.

            (b) Grant. Each SAR shall relate to a specific Option granted under
the Plan and shall be granted to the Optionee concurrently with the grant of
such Option by inclusion of appropriate provisions in the Option Document
pertaining thereto. The number of SARs granted to an Optionee shall not exceed
the number of shares of Common Stock which such Optionee is entitled to purchase
pursuant to the related Option. The number of SARs held by an Optionee shall be
reduced by (i) the number of SARs exercised under the provisions of the Option
Document pertaining to the related Option, and (ii) the number of shares of
Common Stock purchased pursuant to the exercise of the related Option.

            (c) Payment. The Committee shall have sole discretion to determine
whether payment in respect of SARs granted to any Optionee shall be made in
shares of Common Stock, or in cash, or in a combination thereof. If payment is
made in Common Stock, the number of shares of Common Stock which shall be issued
pursuant to the exercise of SARs shall be determined by dividing (i) the total
number of SARs being exercised, multiplied by the amount by which the Fair
Market Value (as determined under section 8(b)) of a share of Common Stock on
the exercise date exceeds the exercise price for shares covered by the related
Option, by (ii) the Fair Market Value of a share of Common Stock on the exercise
date of the SARs. No fractional share of Common Stock shall be issued on
exercise of an SAR; cash may be paid by the Company to the individual exercising
an SAR in lieu of any such fractional share. If payment on exercise of an SAR is
to be made in cash, the individual exercising the SAR shall receive in respect
of each share to which such exercise relates an amount of money equal to the
difference between the Fair Market Value of a share of Common Stock on the
exercise date and the exercise price for shares covered by the related Option.

            (d) Limitations. SARs shall be exercisable at such times and under
such terms and conditions as the Committee, in its sole and absolute discretion,
shall determine; provided, however, that an SAR may be exercised only at such
times and by such individuals as the related Option under the Plan and the
Option Agreement may be exercised.

      12. Terms and Conditions of Awards. Awards granted pursuant to the Plan
shall be evidenced by written Award Agreements in such form as the Committee
shall from time to time approve, which Award

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<PAGE>



Agreements shall comply with and be subject to the following terms and
conditions and such other terms and conditions which the Committee may from time
to time require which are not inconsistent with the terms of the Plan.

            (a) Number of Shares. Each Award Agreement shall state the number of
shares of Common Stock to which it pertains.

            (b) Purchase Price. Each Award Agreement shall specify the purchase
price, if any, which applies to the Award. If the Board specifies a purchase
price, the Grantee shall be required to make payment on or before the date
specified in the Award Agreement. A Grantee shall pay for Shares (i) in cash,
(ii) by certified check payable to the order of the Company, or (iii) by such
other mode of payment as the Committee may approve.

            (c) Grant. In the case of an Award which provides for a grant of
Shares without any payment by the Grantee, the grant shall take place on the
date specified in the Award Agreement. In the case of an Award which provides
for a payment, the grant shall take place on the date the initial payment is
delivered to the Company, unless the Committee or the Award Agreement otherwise
specifies. Stock certificates evidencing Shares granted pursuant to an Award
shall be issued in the sole name of the Grantee. Notwithstanding the foregoing,
as a precondition to a grant, the Company may require an acknowledgment by the
Grantee as required with respect to Options under Section 8.

            (d) Conditions. The Committee may specify in an Award Agreement any
conditions under which the Grantee of that Award shall be required to convey to
the Company the Shares covered by the Award. Upon the occurrence of any such
specified condition, the Grantee shall forthwith surrender and deliver to the
Company the certificates evidencing such Shares as well as completely executed
instruments of conveyance. The Committee, in its discretion, may provide that
certificates for Shares transferred pursuant to an Award be held in escrow by
the Company or an officer of the Company until such time as each and every
condition has lapsed and that the Grantee be required, as a condition of the
Award, to deliver to such escrow agent or Company officer stock powers covering
the Award Shares duly endorsed by the Grantee. Unless otherwise provided in the
Award Agreement, distributions made on Shares held in escrow will be deposited
in escrow, to be distributed to the party becoming entitled to the Shares on
which the distribution was made. Stock certificates evidencing Shares subject to
conditions shall bear a legend to the effect that the Common Stock evidenced
thereby is subject to repurchase or conveyance to the Company in accordance with
an Award made under the Plan and that the Shares may not be sold or otherwise
transferred.

            (e) Lapse of Conditions. Upon termination or lapse of each and every
forfeiture condition, if any, the Company shall cause certificates without the
legend referring to the Company's repurchase right (but with any other legends
that may be appropriate) evidencing the Shares covered by the Award to be issued
to the Grantee upon the Grantee's surrender of the legended certificates held by
him or her to the Company.

            (f) Rights as Stockholder. Upon payment of the purchase price, if
any, for Shares covered by an Award and compliance with the acknowledgment
requirement of subsection 12(c), the Grantee shall have all of the rights of a
stockholder with respect to the Shares covered thereby, including the right to
vote the Shares and receive all dividends and other distributions paid or made
with respect thereto, except to the extent otherwise provided by the Committee
or in the Award Agreement.

      13. Amendment of the Plan. The Board of Directors of the Company may amend
the Plan from time to time in such manner as it may deem advisable.
Nevertheless, the Board of Directors of the Company may not change the class of
individuals eligible to receive an ISO or increase the maximum number of Shares
as to which Options may be granted without obtaining approval, within twelve
months before or after such action, by the stockholders in the manner required
by state law.

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<PAGE>


      14. No Commitment to Retain. The grant of an Option or Award pursuant to
the Plan shall not be construed to imply or to constitute evidence of any
agreement, express or implied, on the part of the Company or any Affiliate to
retain the Optionee or Grantee as an employee, consultant or advisor of the
Company or any Affiliate, as a member of the Board of Directors or in any other
capacity.

      15. Withholding of Taxes. In connection with any event relating to an
Option or Award, the Company shall have the right to (a) require the recipient
to remit or otherwise make available to the Company an amount sufficient to
satisfy any federal, state and/or local withholding tax requirements prior to
the delivery or transfer of any certificate or certificates for such Shares or
(b) take whatever other action it deems necessary to protect its interests with
respect to tax liabilities. The Company's obligations under the Plan shall be
conditioned on the Optionee's or Grantee's compliance, to the Company's
satisfaction, with any withholding requirement.


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