<PAGE>
                                                            EXHIBIT 10.1

                               SCHEID VINEYARDS INC.

                       1997 STOCK OPTION/STOCK ISSUANCE PLAN
                  (AS AMENDED AND RESTATED THROUGH MARCH 10, 1998)

                                    ARTICLE ONE

                                 GENERAL PROVISIONS

    I. PURPOSE OF THE PLAN

    This 1997 Stock Option/Stock Issuance Plan is intended to promote the
interests of Scheid Vineyards Inc., a Delaware corporation, by providing
eligible persons with the opportunity to acquire a proprietary interest, or
otherwise increase their proprietary interest, in the Corporation as an
incentive for them to remain in the service of the Corporation.

    Capitalized terms herein shall have the meanings assigned to such terms
in the attached Appendix.

    II. STRUCTURE OF THE PLAN

         A. The Plan shall be divided into three (3) separate equity programs:

              (i) the Discretionary Option Grant Program under which eligible
         persons may, at the discretion of the Plan Administrator, be granted
         options to purchase shares of Class A Common Stock,

             (ii) the Stock Issuance Program under which eligible persons may,
         at the discretion of the Plan Administrator, be issued shares of
         Class A Common Stock directly, either through the immediate purchase
         of such shares or as a bonus for services rendered to the Corporation
         (or any Parent or Subsidiary), and

            (iii) the Automatic Option Grant Program under which eligible
         non-employee Board members shall automatically receive option grants at
         periodic intervals to purchase shares of Class A Common Stock.

         B. The provisions of Articles One and Five shall apply to all equity
programs under the Plan and shall accordingly govern the interests of all
persons under the Plan.

    III. ADMINISTRATION OF THE PLAN

         A. Administration of the Discretionary Option Grant and Stock
Issuance Programs with respect to Section 16 Insiders may, at the Board's
discretion, be vested in the Primary Committee, or the Board may retain the
power to administer those programs with respect to Section 16 Insiders.

<PAGE>

         B. Administration of the Discretionary Option Grant and Stock
Issuance Programs with respect to all other persons eligible to participate
in those programs may, at the Board's discretion, be vested in the Primary
Committee or a Secondary Committee, or the Board may retain the power to
administer those programs with respect to all such persons.

         C. Members of the Primary Committee or any Secondary Committee shall
serve for such period of time as the Board may determine and may be removed
by the Board at any time.  The Board may also at any time terminate the
functions of the Primary Committee or any Secondary Committee and reassume
all powers and authority previously delegated to such committee.

         D. Each Plan Administrator shall, within the scope of its
administrative functions under the Plan, have full power and authority
(subject to the provisions of the Plan) to establish such rules and
regulations as it may deem appropriate for proper administration of the
Discretionary Option Grant and Stock Issuance Programs and to make such
determinations under, and issue such interpretations of, the provisions of
such programs and any outstanding options or stock issuances thereunder as it
may deem necessary or advisable.  Decisions of the Plan Administrator within
the scope of its administrative functions under the Plan shall be final and
binding on all parties who have an interest in the Discretionary Option Grant
and Stock Issuance Programs under its jurisdiction or any option or stock
issuance thereunder.

         E. Service on the Primary Committee or the Secondary Committee shall
constitute service as a Board member, and members of each such committee
shall accordingly be entitled to full indemnification and reimbursement as
Board members for their service on such committee.  No member of the Primary
Committee or the Secondary Committee shall be liable for any act or omission
made in good faith with respect to the Plan or any option grants or stock
issuances under the Plan.

         F. Administration of the Automatic Option Grant Program shall be
self-executing in accordance with the terms of that program, and no Plan
Administrator shall exercise any discretionary functions with respect to any
option grants or stock issuances made under that program.

    IV. ELIGIBILITY

         A. The persons eligible to participate in the Discretionary Option
Grant and Stock Issuance Programs are as follows:

              (i) Employees,

             (ii) non-employee members of the Board or the non-employee members
         of the board of directors of any Parent or Subsidiary, and

            (iii) consultants and other independent advisors who provide
         services to the Corporation (or any Parent or Subsidiary).

                                      -2-

<PAGE>

          B. The Plan Administrator shall, within the scope of its
administrative jurisdiction under the Plan, have full authority to determine,
(i) with respect to the option grants under the Discretionary Option Grant
Program, which eligible persons are to receive option grants, the time or
times when such option grants are to be made, the number of shares to be
covered by each such grant, the status of the granted option as either an
Incentive Option or a Non-Statutory Option, the time or times when each
option is to become exercisable, the vesting schedule (if any) applicable to
the option shares and the maximum term for which the option is to remain
outstanding and (ii) with respect to stock issuances under the Stock Issuance
Program, which eligible persons are to receive such stock issuances, the time
or times when such issuances are to be made, the number of shares to be
issued to each Participant, the vesting schedule (if any) applicable to the
issued shares and the consideration to be paid for such shares.

         C. The Plan Administrator shall have the absolute discretion either
to grant options in accordance with the Discretionary Option Grant Program or
to effect stock issuances in accordance with the Stock Issuance Program.

         D. The individuals who shall be eligible to participate in the
Automatic Option Grant Program shall be those non-employee Board members
eligible to receive grants in accordance with Section I of Article Four.

    V. STOCK SUBJECT TO THE PLAN

         A. The stock issuable under the Plan shall be shares of authorized
but unissued or reacquired Class A Common Stock, including shares repurchased
by the Corporation in the open market.  The maximum number of shares of Class
A Common Stock which may be issued over the term of the Plan shall not exceed
200,000 shares, subject to adjustment from time to time in accordance with
the provisions of this Section V.

         B. No one person participating in the Plan may receive option grants
or direct stock issuances for more than 100,000 shares of Class A Common
Stock in the aggregate per calendar year.

         C. Shares of Class A Common Stock subject to outstanding options
shall be available for subsequent issuance under the Plan to the extent (i)
the options expire or terminate for any reason prior to exercise in full or
(ii) the options are cancelled in accordance with the cancellation-regrant
provisions of Article Two.  Unvested shares issued under the Plan and
subsequently repurchased by the Corporation, at the option exercise or direct
issue price paid per share, pursuant to the Corporation's repurchase rights
under the Plan shall be added back to the number of shares of Class A Common
Stock reserved for issuance under the Plan and shall accordingly be available
for reissuance through one or more subsequent option grants or direct stock
issuances under the Plan.  However, should the exercise price of an
outstanding option under the Plan be paid with shares of Class A Common
Stock, then the number of shares of Class A Common Stock available for
issuance under the Plan shall be

                                      -3-

<PAGE>

reduced by the gross number of shares for which the option is exercised, and
not by the net number of shares of Class A Common Stock actually issued to
the holder of such option.

         D. Should any change be made to the Class A Common Stock by reason
of any stock split, stock dividend, recapitalization, combination of shares,
exchange of shares or other change affecting the outstanding Class A Common
Stock as a class without the Corporation's receipt of consideration,
appropriate adjustments shall be made to (i) the maximum number and/or class
of securities issuable under the Plan, (ii) the number and/or class of
securities for which any one person may receive option grants or direct stock
issuances under the Plan per calendar year, (iii) the number and/or class of
securities for which grants are subsequently to be made under the Automatic
Option Grant Program to new and continuing non-employee Board members, and
(iv) the number and/or class of securities and the exercise price per share
in effect under each outstanding option under the Plan.  Such adjustments to
the outstanding options are to be effected in a manner which shall preclude
the enlargement or dilution of rights and benefits under those options.  The
adjustments determined by the Plan Administrator shall be final, binding and
conclusive.

                                    ARTICLE TWO

                         DISCRETIONARY OPTION GRANT PROGRAM

    I. OPTION TERMS

    Each option shall be evidenced by one or more documents in the form
approved by the Plan Administrator; provided, however, that each such
document shall comply with the terms specified below.  Each document
evidencing an Incentive Option shall, in addition, be subject to the
provisions of the Plan applicable to such options.

         A. EXERCISE PRICE.

              1. The exercise price per share shall be fixed by the Plan
         Administrator but shall not be less than one hundred percent (100%)
         of the Fair Market Value per share of Class A Common Stock on the
         option grant date.

              2. The exercise price shall become immediately due upon
         exercise of the option and shall, subject to the provisions of
         Section I of Article Five and the documents evidencing the option,
         be payable in cash or check made payable to the Corporation.  Should
         the Class A Common Stock be registered under Section 12(g) of the
         1934 Act at the time the option is exercised, then the exercise
         price may also be paid as follows:

                   (i) in shares of Class A Common Stock held for the
         requisite period necessary to avoid a charge to the Corporation's
         earnings for financial reporting purposes and valued at Fair Market
         Value on the Exercise Date, or

                                      -4-

<PAGE>

                  (ii) to the extent the option is exercised for vested
         shares, through a special sale and remittance procedure pursuant to
         which the Optionee shall concurrently provide irrevocable
         instructions (A) to a Corporation-designated brokerage firm to
         effect the immediate sale of the purchased shares and remit to the
         Corporation, out of the sale proceeds available on the settlement
         date, sufficient funds to cover the aggregate exercise price payable
         for the purchased shares plus all applicable Federal, state and
         local income and employment taxes required to be withheld by the
         Corporation by reason of such exercise and (B) to the Corporation to
         deliver the certificates for the purchased shares directly to such
         brokerage firm in order to complete the sale.

              Except to the extent such sale and remittance procedure is
         utilized, payment of the exercise price for the purchased shares
         must be made on the Exercise Date.

         B. EXERCISE AND TERM OF OPTIONS.  Each option shall be exercisable
at such time or times, during such period and for such number of shares as
shall be determined by the Plan Administrator and set forth in the documents
evidencing the option grant.  However, no option shall have a term in excess
of ten (10) years measured from the option grant date.

         C. EFFECT OF TERMINATION OF SERVICE.

              1. The following provisions shall govern the exercise of any
         options held by the Optionee at the time of cessation of Service or
         death:

                   (i) Any option outstanding at the time of the Optionee's
         cessation of Service for any reason shall remain exercisable for
         such period of time thereafter as shall be determined by the Plan
         Administrator and set forth in the documents evidencing the option,
         but no such option shall be exercisable after the expiration of the
         option term.

                  (ii) Any option exercisable in whole or in part by  the
         Optionee at the time of death may be subsequently exercised by the
         personal representative of the Optionee's estate or by the person or
         persons to whom the option is transferred pursuant to the Optionee's
         will or in accordance with the laws of descent and distribution.

                 (iii) Should the Optionee's Service be terminated for
         Misconduct, then all outstanding options held by the Optionee shall
         terminate immediately and cease to be outstanding.

                  (iv) During the applicable post-Service exercise period,
         the option may not be exercised in the aggregate for more than the
         number of vested shares for which the option is exercisable on the
         date of the Optionee's cessation of Service.  Upon the expiration of
         the applicable exercise period or (if earlier) upon the expiration
         of the option term, the option shall terminate and cease to be
         outstanding for any vested


                                      -5-

<PAGE>


         shares for which the option has not been exercised.  However, the
         option shall, immediately upon the Optionee's cessation of Service,
         terminate and cease to be outstanding to the extent the option is
         not otherwise at that time exercisable for vested shares.

              2. The Plan Administrator shall have the discretion,
         exercisable either at the time an option is granted or at any time
         while the option remains outstanding, to:

                   (i) extend the period of time for which the option is to
         remain exercisable following the Optionee's cessation of Service or
         death from the limited exercise period otherwise in effect for that
         option to such greater period of time as the Plan Administrator
         shall deem appropriate, but in no event beyond the expiration of the
         option term, and/or

                  (ii) permit the option to be exercised, during the
         applicable post-Service exercise period, not only with respect to
         the number of vested shares of Class A Common Stock for which such
         option is exercisable at the time of the Optionee's cessation of
         Service but also with respect to one or more additional installments
         in which the Optionee would have vested under the option had the
         Optionee continued in Service.

    D. STOCKHOLDER RIGHTS.  The holder of an option shall have no stockholder
rights with respect to the shares subject to the option until such person
shall have exercised the option, paid the exercise price and become a holder
of record of the purchased shares.

    E. UNVESTED SHARES.  The Plan Administrator shall have the discretion to
grant options which are exercisable for unvested shares of Class A Common
Stock.  Should the Optionee cease Service while holding such unvested shares,
the Corporation shall have the right to repurchase, at the exercise price
paid per share, any or all of those unvested shares.  The terms upon which
such repurchase right shall be exercisable (including the period and
procedure for exercise and the appropriate vesting schedule for the purchased
shares) shall be established by the Plan Administrator and set forth in the
document evidencing such repurchase right.

    F. LIMITED TRANSFERABILITY OF OPTIONS.  During the lifetime of the
Optionee, Incentive Options shall be exercisable only by the Optionee and
shall not be assignable or transferable other than by will or by the laws of
descent and distribution following the Optionee's death.  However, a
Non-Statutory Option may, in connection with the Optionee's estate plan, be
assigned in whole or in part during the Optionee's lifetime to one or more
members of the Optionee's immediate family or to a trust established
exclusively for one or more such family members.  The assigned portion may
only be exercised by the person or persons who acquire a proprietary interest
in the option pursuant to the assignment.  The terms applicable to the
assigned portion shall be the same as those in effect for the option
immediately prior to such assignment and shall be set forth in such documents
issued to the assignee as the Plan Administrator may deem appropriate.

                                      -6-

<PAGE>

    G. WITHHOLDING.  The Corporation's obligation to deliver shares of Class
A Common Stock upon the exercise of any options granted under the Plan shall
be subject to the satisfaction of all applicable Federal, state and local
income and employment tax withholding requirements.

    II. INCENTIVE OPTIONS

    The terms specified below shall be applicable to all Incentive Options.
Except as modified by the provisions of this Section II, all the provisions
of Articles One, Two and Five shall be applicable to Incentive Options.
Options which are specifically designated as Non-Statutory Options when
issued under the Plan shall not be subject to this Section II.

         A. ELIGIBILITY.  Incentive Options may only be granted to Employees.

         B. DOLLAR LIMITATION.  The aggregate Fair Market Value of the shares
of Class A Common Stock (determined as of the respective date or dates of
grant) for which one or more options granted to any Employee under the Plan
(or any other option plan of the Corporation or any Parent or Subsidiary) may
for the first time become exercisable as Incentive Options during any one
calendar year shall not exceed the sum of One Hundred Thousand Dollars
($100,000).  To the extent the Employee holds two (2) or more such options
which become exercisable for the first time in the same calendar year, the
foregoing limitation on the exercisability of such options as Incentive
Options shall be applied on the basis of the order in which such options are
granted.

         C. 10% STOCKHOLDER.  If any Employee to whom an Incentive Option is
granted is a 10% Stockholder, then the exercise price per share shall not be
less than one hundred ten percent (110%) of the Fair Market Value per share
of Class A Common Stock on the option grant date, and the option term shall
not exceed five (5) years measured from the option grant date.

     III. CORPORATE TRANSACTION/CHANGE IN CONTROL

         A. In the event of any Corporate Transaction, each outstanding
option shall automatically accelerate so that each such option shall,
immediately prior to the effective date of the Corporate Transaction, become
fully exercisable with respect to the total number of shares of Class A
Common Stock at the time subject to such option and may be exercised for any
or all of those shares as fully-vested shares of Class A Common Stock.
However, an outstanding option shall not so accelerate if and to the extent:
(i) such option is, in connection with the Corporate Transaction, either to
be assumed by the successor corporation (or parent thereof) or to be replaced
with a comparable option to purchase shares of the capital stock of the
successor corporation (or parent thereof), (ii) such option is to be replaced
with a cash incentive program of the successor corporation which preserves
the spread existing on the unvested option shares at the time of the
Corporate Transaction and provides for subsequent payout in accordance with
the same vesting schedule applicable to those option shares or (iii) the
acceleration of such option is subject to other limitations imposed by the
Plan

                                      -7-

<PAGE>

Administrator at the time of the option grant.  The determination of option
comparability under clause (i) above shall be made by the Plan Administrator,
and its determination shall be final, binding and conclusive.

         B. All outstanding repurchase rights shall also terminate
automatically, and the unvested shares of Class A Common Stock subject to
those terminated rights shall immediately vest in full, in the event of any
Corporate Transaction, except to the extent: (i) those repurchase rights are
assigned to the successor corporation (or parent thereof) in connection with
such Corporate Transaction or (ii) such accelerated vesting is precluded by
other limitations imposed by the Plan Administrator at the time the
repurchase right is issued.

         C. Immediately following the consummation of the Corporate
Transaction, all outstanding options shall terminate and cease to be
outstanding, except to the extent assumed by the successor corporation (or
parent thereof).

         D. Each option which is assumed in connection with a Corporate
Transaction shall be appropriately adjusted, immediately after such Corporate
Transaction, to apply to the number and class of securities which would have
been issuable to the Optionee in consummation of such Corporate Transaction,
had the option been exercised immediately prior to such Corporate
Transaction. Appropriate adjustments shall also be made to (i) the number and
class of securities available for issuance under the Plan following the
consummation of such Corporate Transaction and (ii) the exercise price
payable per share under each outstanding option, provided the aggregate
exercise price payable for such securities shall remain the same.

         E. The Plan Administrator shall have the discretion, exercisable
either at the time the option is granted or at any time while the option
remains outstanding, to provide for the automatic acceleration (in whole or
in part) of one or more outstanding options (and the automatic termination of
one or more outstanding repurchase rights, with the immediate vesting of the
shares of Class A Common Stock subject to those terminated rights) upon the
occurrence of a Corporate Transaction, whether or not those options are to be
assumed or replaced in the Corporate Transaction.

         F. The Plan Administrator shall have full power and authority to
grant options under the Discretionary Option Grant Program which will
automatically accelerate in the event the Optionee's Service terminates by
reason of an Involuntary Termination within a designated period (not to
exceed eighteen (18) months) following the effective date of any Corporate
Transaction in which those options are assumed or replaced and do not
otherwise accelerate. Any options so accelerated shall remain exercisable for
fully-vested shares until the earlier of (i) the expiration of the option
term or (ii) the expiration of the one (1)-year period measured from the
effective date of the Involuntary Termination.  In addition, the Plan
Administrator may provide that one or more of the Corporation's outstanding
repurchase rights with respect to shares held by the Optionee at the time of
such Involuntary Termination shall immediately terminate, and the shares
subject to those terminated repurchase rights shall accordingly vest in full.

                                      -8-

<PAGE>

         G. The Plan Administrator shall have full power and authority to
grant options under the Discretionary Option Grant Program which will
automatically accelerate in the event the Optionee's Service subsequently
terminates by reason of an Involuntary Termination within a designated period
(not to exceed eighteen (18) months) following the effective date of any
Change in Control.  Each option so accelerated shall remain exercisable for
fully-vested shares until the earlier of (i) the expiration of the option
term or (ii) the expiration of the one (1)-year period measured from the
effective date of the Involuntary Termination.  In addition, the Plan
Administrator may provide that one or more of the Corporation's outstanding
repurchase rights with respect to shares held by the Optionee at the time of
such Involuntary Termination shall immediately terminate, and the shares
subject to those terminated repurchase rights shall accordingly vest in full.

         H. The portion of any Incentive Option accelerated in connection
with a Corporate Transaction or a Change in Control shall remain exercisable
as an Incentive Option only to the extent the applicable One Hundred Thousand
Dollar ($100,000) limitation is not exceeded.  To the extent such dollar
limitation is exceeded, the accelerated portion of such option shall be
exercisable as a Non-Statutory Option under the Federal tax laws.

         I. The grant of options under the Plan shall in no way affect the
right of the Corporation to adjust, reclassify, reorganize or otherwise
change its capital or business structure or to merge, consolidate, dissolve,
liquidate or sell or transfer all or any part of its business or assets.

    IV. CANCELLATION AND REGRANT OF OPTIONS

    The Plan Administrator shall have the authority to effect, at any time
and from time to time, with the consent of the affected option holders, the
cancellation of any or all outstanding options under the Discretionary Option
Grant Program and to grant in substitution therefor new options covering the
same or different number of shares of Class A Common Stock but with an
exercise price per share based on the Fair Market Value per share of Class A
Common Stock on the new option grant date.

                                   ARTICLE THREE

                               STOCK ISSUANCE PROGRAM

    I. STOCK ISSUANCE TERMS

    Shares of Class A Common Stock may be issued under the Stock Issuance
Program through direct and immediate issuances without any intervening option
grants.  Each such stock issuance shall be evidenced by a Stock Issuance
Agreement which complies with the terms specified below.

                                      -9-

<PAGE>

    A. PURCHASE PRICE.

              1. The purchase price per share shall be fixed by the Plan
         Administrator but shall not be less than one hundred percent (100%)
         of the Fair Market Value per share of Class A Common Stock on the
         issue date.

              2. Subject to the provisions of Section I of Article Five,
         shares of Class A Common Stock may be issued under the Stock
         Issuance Program for any of the following items of consideration
         which the Plan Administrator may deem appropriate in each individual
         instance:

                  (i) cash or check made payable to the Corporation, or

                 (ii) past services rendered to the Corporation (or any Parent
          or Subsidiary).

    B. VESTING PROVISIONS.

              1. Shares of Class A Common Stock issued under the Stock
         Issuance Program may, in the discretion of the Plan Administrator,
         be fully and immediately vested upon issuance or may vest in one or
         more installments over the Participant's period of Service or upon
         attainment of specified performance objectives.

              2. Any new, substituted or additional securities or other
         property (including money paid other than as a regular cash
         dividend) which the Participant may have the right to receive with
         respect to the Participant's unvested shares of Class A Common Stock
         by reason of any stock dividend, stock split, recapitalization,
         combination of shares, exchange of shares or other change affecting
         the outstanding Class A Common Stock as a class without the
         Corporation's receipt of consideration shall be issued subject to
         (i) the same vesting requirements applicable to the Participant's
         unvested shares of Class A Common Stock and (ii) such escrow
         arrangements as the Plan Administrator shall deem appropriate.

              3. The Participant shall have full stockholder rights with
         respect to any shares of Class A Common Stock issued to the
         Participant under the Stock Issuance Program, whether or not the
         Participant's interest in those shares is vested.  Accordingly, the
         Participant shall have the right to vote such shares and to receive
         any regular cash dividends paid on such shares.

              4. Should the Participant cease to remain in Service while
         holding one or more unvested shares of Class A Common Stock issued
         under the Stock Issuance Program or should the performance
         objectives not be attained with respect to one or more such unvested
         shares of Class A Common Stock, then those shares shall be
         immediately surrendered to the Corporation for cancellation, and the
         Participant shall have no further stockholder rights with respect to
         those shares.  To the extent the surrendered shares were previously
         issued to the Participant for consideration paid in

                                      -10-

<PAGE>

         cash or cash equivalent (including the Participant's purchase-money
         indebtedness), the Corporation shall repay to the Participant the
         cash consideration paid for the surrendered shares and shall cancel
         the unpaid principal balance of any outstanding purchase-money note
         of the Participant attributable to such surrendered shares.

              5. The Plan Administrator may in its discretion waive the
         surrender and cancellation of one or more unvested shares of Class A
         Common Stock (or other assets attributable thereto) which would
         otherwise occur upon the non-completion of the vesting schedule
         applicable to such shares.  Such waiver shall result in the
         immediate vesting of the Participant's interest in the shares of
         Class A Common Stock as to which the waiver applies.  Such waiver
         may be effected at any time, whether before or after the
         Participant's cessation of Service or the attainment or
         non-attainment of the applicable performance objectives.

    II.  CORPORATE TRANSACTION/CHANGE IN CONTROL

         A.  Upon the occurrence of a Corporate Transaction, all outstanding
repurchase rights under the Stock Issuance Program shall terminate
automatically, and the shares of Class A Common Stock subject to those
terminated rights shall immediately vest in full, except to the extent: (i)
those repurchase rights are assigned to the successor corporation (or parent
thereof) in connection with such Corporate Transaction or (ii) such
accelerated vesting is precluded by other limitations imposed by the Plan
Administrator at the time the repurchase right is issued.

         B.    The Plan Administrator shall have the discretionary authority,
exercisable either at the time the unvested shares are issued or any time
while the Corporation's repurchase rights with respect to those shares remain
outstanding, to provide that those rights shall automatically terminate on an
accelerated basis, and the shares of Class A Common Stock subject to those
terminated rights shall immediately vest, in the event the Participant's
Service should subsequently terminate by reason of an Involuntary Termination
within a designated period (not to exceed eighteen (18) months) following the
effective date of any Corporate Transaction in which those repurchase rights
are assigned to the successor corporation (or parent thereof).

         C.    The Plan Administrator shall have the discretionary authority,
exercisable either at the time the unvested shares are issued or any time
while the Corporation's repurchase/cancellation rights remain outstanding
under the Stock Issuance Program, to provide that those rights shall
automatically terminate in whole or in part, and the shares of Class A Common
Stock subject to those terminated rights shall immediately vest, in the event
the Participant's Service should subsequently terminate by reason of an
Involuntary Termination within a designated period (not to exceed eighteen
(18) months) following the effective date of any Change in Control.

                                      -11-

<PAGE>

     III.  SHARE ESCROW/LEGENDS

     Unvested shares may, in the Plan Administrator's discretion, be held in
escrow by the Corporation until the Participant's interest in such shares
vests or may be issued directly to the Participant with restrictive legends
on the certificates evidencing those unvested shares.

                                   ARTICLE FOUR

                          AUTOMATIC OPTION GRANT PROGRAM

     I. OPTION TERMS

         A. GRANT DATES.  Option grants shall be made under this Automatic
Option Grant Program on the dates specified below:

              1.   Each individual serving as a non-employee Board member on
         the Underwriting Date shall automatically be granted on that date a
         Non-Statutory Option to purchase 10,000 shares of Class A Common
         Stock, provided that individual has not previously been in the
         employ of the Corporation or any Parent or Subsidiary and has not
         previously received an option grant from the Corporation in his or
         her capacity as a non-employee Board member.

              2.   Each individual who is first elected or appointed as a
         non-employee Board member at any time after the Underwriting Date
         shall automatically be granted on the date of such initial election
         or appointment a Non-Statutory Option to purchase 10,000 shares of
         Class A Common Stock, provided that individual has not previously
         been in the employ of the Corporation or any Parent or Subsidiary.

               3.   On the date of each Annual Stockholders Meeting held
         after the Underwriting Date, each individual who is to continue to
         serve as a non-employee Board member, whether or not that individual
         is standing for re-election to the Board at that particular Annual
         Meeting, shall automatically be granted a Non-Statutory Option to
         purchase 2,500 shares of Class A Common Stock, provided such
         individual has served as a non-employee Board member for at least
         six (6) months.  There shall be no limit on the number of such
         2,500-share option grants any one non-employee Board member may
         receive over his or her period of Board service, and non-employee
         Board members who have previously been in the employ of the
         Corporation (or any Parent or Subsidiary) or who have otherwise
         received a stock option grant from the Corporation prior to the
         Underwriting Date shall be eligible to receive one or more such
         annual option grants over their period of continued Board service.

         B.    EXERCISE PRICE.

               1.   The exercise price per share shall be equal to one
         hundred percent (100%) of the Fair Market Value per share of Class A
         Common Stock on the option grant date.

                                      -12-

<PAGE>

               2.   The exercise price shall be payable in one or more of the
         alternative forms authorized under Article Two, Section I.A.2.
         Except to the extent the sale and remittance procedure specified
         thereunder is utilized, payment of the exercise price for the
         purchased shares must be made on the Exercise Date.

         C.    OPTION TERM.  Each option shall have a term of ten (10) years
measured from the option grant date.

         D.    EXERCISE AND VESTING OF OPTIONS.  Each initial 10,000-share
grant shall become exercisable in a series of four (4) successive equal
annual installments upon the Optionee's completion of each year of Board
service over the four (4)-year period measured from the option grant date.
Each annual 2,500-share grant shall become exercisable upon the Optionee's
completion of one (1) year of Board service measured from the automatic grant
date.

         E.    EFFECT OF TERMINATION OF SERVICE.  The following provisions
shall govern the exercise of any options granted to the Optionee pursuant to
this Automatic Option Grant Program and held at the time of his or her
cessation of Board service or death:

               1.   The Optionee (or, in the event of Optionee's death, the
         personal representative of the Optionee's estate or the person or
         persons to whom the option is transferred pursuant to the Optionee's
         will or in accordance with the laws of descent and distribution)
         shall have a twelve (12)-month period following the date of such
         cessation of Board service in which to exercise each such option.

                    2.   During the twelve (12)-month exercise period, the
         option may not be exercised in the aggregate for more than the
         number of vested shares of Class A Common Stock for which the option
         is exercisable at the time of the Optionee's cessation of Board
         service.

                    3.   Should the Optionee cease to serve as a Board member
         by reason of death or Permanent Disability, then all shares at the
         time subject to the option shall immediately vest so that such
         option may, during the twelve (12)-month exercise period following
         such cessation of Board service, be exercised for all or any portion
         of those shares as fully-vested shares of Class A Common Stock.

                    4.   In no event shall the option remain exercisable
         after the expiration of the option term.  Upon the expiration of the
         twelve (12)-month exercise period or (if earlier) upon the
         expiration of the option term, the option shall terminate and cease
         to be outstanding for any vested shares for which the option has not
         been exercised.  However, the option shall, immediately upon the
         Optionee's cessation of Board service for any reason other than
         death or Permanent Disability, terminate and cease to be outstanding
         with respect to any option shares in which the Optionee is not
         otherwise vested at that time.

                                      -13-

<PAGE>

         F.    STOCKHOLDER RIGHTS.  The holder of an option grant under this
Automatic Option Grant Program shall have no stockholder rights with respect
to the shares subject to the option until such person shall have exercised
the option, paid the exercise price and become a holder of record of the
purchased shares.

         G.    LIMITED TRANSFERABILITY OF OPTIONS.  This option may, in
connection with the Optionee's estate plan, be assigned in whole or in part
during Optionee's lifetime to one or more members of the Optionee's immediate
family or to a trust established for the exclusive benefit of one or more
such family members.  The assigned portion shall be exercisable only by the
person or persons who acquire a proprietary interest in the option pursuant
to such assignment.  The terms applicable to the assigned portion shall be
the same as those in effect for this option immediately prior to such
assignment and shall be set forth in such documents issued to the assignee as
the Corporation may deem appropriate.  Should the Optionee die while holding
this option, then this option shall be transferred in accordance with
Optionee's will or the laws of descent and distribution.

     II.       CORPORATE TRANSACTION/CHANGE IN CONTROL

         A.    In the event of any Corporate Transaction, each outstanding
option under this Automatic Option Grant Program shall automatically
accelerate so that each such option shall, immediately prior to the specified
effective date for the Corporate Transaction, become fully exercisable for
all of the shares of Class A Common Stock at the time subject to that option
and may be exercised for all or any portion of such shares as fully-vested
shares of Class A Common Stock.  Immediately following the consummation of
the Corporate Transaction, all automatic option grants under this Article
Four shall terminate and cease to be outstanding, unless assumed by the
successor corporation or its parent company.

         B.    In connection with any Change in Control, each outstanding
option shall automatically accelerate so that each such option shall,
immediately prior to the effective date of the Change in Control, become
fully exercisable for all of the shares of Class A Common Stock at the time
subject to such option and may be exercised for all or any portion of those
shares as fully-vested shares of Class A Common Stock.  Each such option
shall remain exercisable for such fully-vested option shares until the
expiration or sooner termination of the option term.

         C.    Each option which is assumed in connection with a Corporate
Transaction shall be appropriately adjusted, immediately after such Corporate
Transaction, to apply to the number and class of securities which would have
been issuable to the Optionee in the consummation of such Corporate
Transaction, had the option been exercised immediately prior to such
Corporate Transaction. Appropriate adjustments shall also be made to the
exercise price payable per share under each outstanding option, provided the
aggregate exercise price payable for such securities shall remain the same.

         D.    The grant of options under the Automatic Option Grant Program
shall in no way affect the right of the Corporation to adjust, reclassify,
reorganize or otherwise change its

                                      -14-

<PAGE>

capital or business structure or to merge, consolidate, dissolve, liquidate
or sell or transfer all or any part of its business or assets.

                                  ARTICLE FIVE

                                 MISCELLANEOUS

     I.    FINANCING

     The Plan Administrator may permit any Optionee or Participant to pay the
option exercise price or the purchase price for shares issued to such person
under the Plan by delivering a full-recourse, interest-bearing promissory
note payable in one or more installments and secured by the purchased shares.
 The terms of any such promissory note (including the interest rate and the
terms of repayment) shall be established by the Plan Administrator in its
sole discretion.  In no event shall the maximum credit available to the
Optionee or Participant exceed the sum of (i) the aggregate option exercise
price or purchase price payable for the purchased shares plus (ii) any
Federal, state and local income and employment tax liability incurred by the
Optionee or the Participant in connection with the option exercise or share
purchase.

     II.   EFFECTIVE DATE AND TERM OF PLAN

         A.    The Board adopted the Plan on July 16, 1997, and the
stockholders approved the Plan in July 1997.  The Plan became effective on
the Underwriting Date.  The Board amended and restated the Plan on March 10,
1998.

         B.    The Plan shall terminate upon the earliest of (i) June 30,
2007, (ii) the date on which all shares available for issuance under the Plan
shall have been issued as fully-vested shares or (iii) the termination of all
outstanding options in connection with a Corporate Transaction.  All options
and unvested stock issuances outstanding at that time under the Plan shall
continue to have full force and effect in accordance with the provisions of
the documents evidencing such options or issuances.

     III.   AMENDMENT OF THE PLAN

         A.    The Board shall have complete and exclusive power and
authority to amend or modify the Plan in any or all respects.  However, no
such amendment or modification shall adversely affect the rights and
obligations with respect to options or unvested stock issuances at the time
outstanding under the Plan unless the Optionee or the Participant consents to
such amendment or modification.  In addition, certain amendments may require
stockholder approval pursuant to applicable laws and regulations.

         B.    Options may be granted under the Discretionary Option Grant
Program and shares may be issued under the Stock Issuance Program which are
in each instance in excess of the number of shares of Class A Common Stock
then available for issuance under the Plan, provided any excess shares
actually issued under those programs shall be held in escrow until

                                      -15-

<PAGE>

there is obtained stockholder approval of an amendment sufficiently
increasing the number of shares of Class A Common Stock available for
issuance under the Plan.  If such stockholder approval is not obtained within
twelve (12) months after the date the first such excess issuances are made,
then (i) any unexercised options granted on the basis of such excess shares
shall terminate and cease to be outstanding and (ii) the Corporation shall
promptly refund to the Optionees and the Participants the exercise or
purchase price paid for any excess shares issued under the Plan and held in
escrow, together with interest (at the applicable Short Term Federal Rate)
for the period the shares were held in escrow, and such shares shall
thereupon be automatically cancelled and cease to be outstanding.

     IV.  USE OF PROCEEDS

     Any cash proceeds received by the Corporation from the sale of shares of
Class A Common Stock under the Plan shall be used for general corporate
purposes.

      V.  WITHHOLDING

      The Corporation's obligation to deliver shares of Class A Common Stock
upon the exercise of any options or upon the vesting of any shares issued
under the Plan shall be subject to the satisfaction of all applicable
Federal, state and local income and employment tax withholding requirements.

     VI.  REGULATORY APPROVALS

      The implementation of the Plan, the granting of any options under the
Plan and the issuance of any shares of Class A Common Stock (i) upon the
exercise of any option or (ii) under the Stock Issuance Program shall be
subject to the Corporation's procurement of all approvals and permits
required by regulatory authorities having jurisdiction over the Plan, the
options granted under it and the shares of Class A Common Stock issued
pursuant to it.

     VII.  NO EMPLOYMENT OR SERVICE RIGHTS

     Nothing in the Plan shall confer upon the Optionee or the Participant
any right to continue in Service for any period of specific duration or
interfere with or otherwise restrict in any way the rights of the Corporation
(or any Parent or Subsidiary employing or retaining such person) or of the
Optionee or the Participant, which rights are hereby expressly reserved by
each, to terminate such person's Service at any time for any reason, with or
without cause.

                                      -16-

<PAGE>

                                      APPENDIX

     The following definitions shall be in effect under the Plan:

         A.    AUTOMATIC OPTION GRANT PROGRAM shall mean the automatic option
grant program in effect under Article Four of the Plan.

         B.    BOARD shall mean the Corporation's Board of Directors.

         C.    CHANGE IN CONTROL shall mean

               (i)  a change in ownership or control of the Corporation
         effected through either of the following transactions:

                   (A)  the acquisition, directly or indirectly by any
         person or related group of persons (other than the Corporation, or a
         person that directly or indirectly controls, is controlled by, or is
         under common control with, the Corporation), of beneficial ownership
         (within the meaning of Rule 13d-3 of the 1934 Act) of securities
         possessing more than fifty percent (50%) of the total combined
         voting power of the outstanding securities of the Corporation
         pursuant to a tender or exchange offer made directly to the
         Corporation's stockholders, or

                   (B)  a change in the composition of the Board over a
         period of thirty-six (36) consecutive months or less such that a
         majority of the Board members ceases, by reason of one or more
         contested elections for Board membership, to be comprised of
         individuals who either (A) have been Board members continuously
         since the beginning of such period or (B) have been elected or
         nominated for election as Board members during such period by at
         least a majority of the Board members described in clause (A) who
         were still in office at the time the Board approved such election or
         nomination, or

              (ii) a change in ownership of the Named Subsidiary effected
         through the acquisition by any person (or related group of persons),
         whether by tender or exchange offer made directly to the
         stockholders of the Named Subsidiary, private purchases from one or
         more of the stockholders of the Named Subsidiary, one or more direct
         issuances of securities from the Named Subsidiary or by any other
         transaction, of beneficial ownership (within the meaning of Rule
         13d-3 of the 1934 Act) of securities possessing more than fifty
         percent (50%) of the total combined voting power of the outstanding
         securities of the Named Subsidiary.

         D.    CLASS A COMMON STOCK shall mean shares of the Corporation's
Class A Common Stock, which shall be registered under Section 12(g) of the 1934
Act and shall have the right to one (1) vote per share on all matters subject to
stockholder approval.

         E.    CODE shall mean the Internal Revenue Code of 1986, as amended.

                                      A-1

<PAGE>

         F.    COMMITTEE shall mean a committee of two (2) or more Board members
appointed by the Board to exercise one or more administrative functions under
the Plan.

         G.    CORPORATE TRANSACTION shall mean either of the following
stockholder-approved transactions to which (i) the Corporation is a party while
the Parent of the Named Subsidiary or (ii) the Named Subsidiary is a party:

              (i)  a merger or consolidation in which securities possessing
         more than fifty percent (50%) of the total combined voting power of
         the outstanding securities of the Corporation or the Named
         Subsidiary (as the case may be) are transferred to a person or
         persons different from the person or persons holding those
         securities immediately prior to such transaction, or

             (ii)  the sale, transfer or other disposition of all or
         substantially all of the assets of the Corporation or the Named
         Subsidiary (as the case may be) in complete liquidation or
         dissolution of the Corporation or the Named Subsidiary.

         H.    CORPORATION shall mean Scheid Vineyards Inc., a Delaware
corporation, and any successor corporation to all or substantially all of the
assets or voting stock of Scheid Vineyards Inc.  which shall by appropriate
action adopt the Plan.

         I.    DISABILITY shall mean the inability of the Optionee or the
Participant to engage in any substantial gainful activity by reason of any
medically determinable physical or mental impairment and shall be determined by
the Plan Administrator on the basis of such medical evidence as the Plan
Administrator deems warranted under the circumstances.

         J.    DISCRETIONARY OPTION GRANT PROGRAM shall mean the discretionary
option grant program in effect under Article Two of the Plan.

         K.    EMPLOYEE shall mean an individual who is in the employ of the
Corporation (or any Parent or Subsidiary), subject to the control and direction
of the employer entity as to both the work to be performed and the manner and
method of performance.

         L.    EXERCISE DATE shall mean the date on which the Corporation shall
have received written notice of the option exercise.

         M.    FAIR MARKET VALUE per share of Class A Common Stock on any
relevant date shall be determined in accordance with the following provisions:

               (i)  If the Class A Common Stock is at the time traded on the
         Nasdaq National Market, then the Fair Market Value shall be the
         closing selling price per share of Class A Common Stock on the date
         in question, as such price is reported by the National Association
         of Securities Dealers on the Nasdaq National Market.  If there is no
         closing selling price for the Class A Common Stock on the date in
         question, then the Fair Market Value shall be the closing selling
         price on the last preceding date for which such quotation exists.

                                      A-2

<PAGE>

              (ii) If the Class A Common Stock is at the time listed on any
         Stock Exchange, then the Fair Market Value shall be the closing
         selling price per share of Class A Common Stock on the date in
         question on the Stock Exchange determined by the Plan Administrator
         to be the primary market for the Class A Common Stock, as such price
         is officially quoted in the composite tape of transactions on such
         exchange.  If there is no closing selling price for the Class A
         Common Stock on the date in question, then the Fair Market Value
         shall be the closing selling price on the last preceding date for
         which such quotation exists.

         N.    INCENTIVE OPTION shall mean an option which satisfies the
requirements of Code Section 422.

         O.    INVOLUNTARY TERMINATION shall mean the termination of the Service
of any individual which occurs by reason of:

              (i)  such individual's involuntary dismissal or discharge by
         the Corporation for reasons other than Misconduct, or

             (ii) such individual's voluntary resignation following (A) a
         change in his or her position with the Corporation which materially
         reduces his or her duties and responsibilities or the level of
         management to which he or she reports, (B) a reduction in his or her
         level of compensation (including base salary, fringe benefits and
         target bonuses under any corporate-performance based bonus or
         incentive programs) by more than fifteen percent (15%) or (C) a
         relocation of such individual's place of employment by more than
         fifty (50) miles, provided and only if such change, reduction or
         relocation is effected without the individual's consent.

         P.    MISCONDUCT shall mean the commission of any act of fraud,
embezzlement or dishonesty by the Optionee or Participant, any unauthorized use
or disclosure by such person of confidential information or trade secrets of the
Corporation (or any Parent or Subsidiary), or any other intentional misconduct
by such person adversely affecting the business or affairs of the Corporation
(or any Parent or Subsidiary) in a material manner.  The foregoing definition
shall not be deemed to be inclusive of all the acts or omissions which the
Corporation (or any Parent or Subsidiary) may consider as grounds for the
dismissal or discharge of any Optionee, Participant or other person in the
Service of the Corporation (or any Parent or Subsidiary).

         Q.    1934 ACT shall mean the Securities Exchange Act of 1934, as
amended.

         R.    NAMED SUBSIDIARY shall mean Scheid Vineyards California Inc.,
a California corporation and a Subsidiary of the Corporation, and any
successor corporation to all or substantially all of the assets or voting
stock of Scheid Vineyards California Inc.

         S.    NON-STATUTORY OPTION shall mean an option not intended to
satisfy the requirements of Code Section 422.

                                      A-3

<PAGE>

         T.    OPTIONEE shall mean any person to whom an option is granted
under the Plan.

         U.    PARENT shall mean any corporation (other than the Corporation)
in an unbroken chain of corporations ending with the Corporation, provided
each corporation in the unbroken chain (other than the Corporation) owns, at
the time of the determination, stock possessing fifty percent (50%) or more
of the total combined voting power of all classes of stock in one of the
other corporations in such chain.

         V.    PARTICIPANT shall mean any person who is issued shares of
Class A Common Stock under the Stock Issuance Program.

         W.    PERMANENT DISABILITY or PERMANENTLY DISABLED shall mean the
inability of the Optionee or the Participant to engage in any substantial
gainful activity by reason of any medically determinable physical or mental
impairment expected to result in death or to be of continuous duration of
twelve (12) months or more.  However, solely for purposes of the Automatic
Option Grant Program, Permanent Disability or Permanently Disabled shall mean
the inability of the non-employee Board member to perform his or her usual
duties as a Board member by reason of any medically determinable physical or
mental impairment expected to result in death or to be of continuous duration
of twelve (12) months or more.

         X.    PLAN shall mean the Corporation's 1997 Stock Option/Stock
Issuance Plan, as set forth in this document.

         Y.    PLAN ADMINISTRATOR shall mean the particular entity, whether
the Primary Committee, the Board or the Secondary Committee, which is
authorized to administer the Discretionary Option Grant and Stock Issuance
Programs with respect to one or more classes of eligible persons, to the
extent such entity is carrying out its administrative functions under those
programs with respect to the persons under its jurisdiction.

         Z.    PRIMARY COMMITTEE shall mean the committee of two (2) or more
non-employee Board members appointed by the Board to administer the
Discretionary Option Grant and Stock Issuance Programs with respect to
Section 16 Insiders.

         AA.   SECONDARY COMMITTEE shall mean a committee of one (1) or more
Board members appointed by the Board to administer the Discretionary Option
Grant and Stock Issuance Programs with respect to eligible persons other than
Section 16 Insiders.

         AB.   SECTION 16 INSIDER shall mean an officer or director of the
Corporation subject to the short-swing profit restrictions of Section 16 of
the 1934 Act.

         AC.   SERVICE shall mean the provision of services to the
Corporation (or any Parent or Subsidiary) by a person in the capacity of an
Employee, a non-employee member of the board of directors or a consultant or
independent advisor, except to the extent otherwise specifically provided in
the documents evidencing the option grant.

                                      A-4

<PAGE>

         AD.   STOCK EXCHANGE shall mean either the American Stock Exchange
or the New York Stock Exchange.

         AE.   STOCK ISSUANCE AGREEMENT shall mean the agreement entered into
by the Corporation and the Participant at the time of issuance of shares of
Class A Common Stock under the Stock Issuance Program.

         AF.   STOCK ISSUANCE PROGRAM shall mean the stock issuance program
in effect under Article Three of the Plan.

         AG.   SUBSIDIARY shall mean any corporation (other than the
Corporation) in an unbroken chain of corporations beginning with the
Corporation, provided each corporation (other than the last corporation) in
the unbroken chain owns, at the time of the determination, stock possessing
fifty percent (50%) or more of the total combined voting power of all classes
of stock in one of the other corporations in such chain.

         AH.   10% STOCKHOLDER shall mean the owner of stock (as determined
under Code Section 424(d)) possessing more than ten percent (10%) of the
total combined voting power of all classes of stock of the Corporation (or
any Parent or Subsidiary).

         AI.   UNDERWRITING AGREEMENT shall mean the agreement between the
Corporation and the underwriter or underwriters managing the initial public
offering of the Class A Common Stock.

         AJ.   UNDERWRITING DATE shall mean the date on which the Underwriting
Agreement is executed and priced in connection with an initial public offering
of the Class A Common Stock.

                                      A-5