<PAGE>   1
                                                                    EXHIBIT 10.4

                      NON-QUALIFIED STOCK OPTION AGREEMENT

                              SIENA HOLDINGS, INC.


1.  GRANT OF OPTION. Siena Holdings, Inc., a Delaware corporation (the "Company"
    or "Siena") or its Subsidiaries, hereby grants to:

                                   FRANK RYAN
                         (the "Grantee" "You" or "Your")

    an option to purchase from the Company a total of 40,000 full shares ("Stock
    Options") of Ordinary Shares ("Common Stock") of the Company at $0.92 per
    share in the amounts, during the periods, and upon the terms and conditions
    set forth in this agreement. The Date of Grant of this Stock Option is
    DECEMBER 1, 1997. This is a NON-QUALIFIED STOCK OPTION.

2.  SUBJECT TO PLAN. This Stock Option and its exercise are subject to the terms
    and conditions of this Agreement. The capitalized terms used in this
    Agreement are defined below. This Stock Option is subject to any rules which
    have been or may be made by the Board or the Committee and communicated to
    you in writing.

    (A) Board. The Board of Directors (or equivalent governing authority) of the
    Company, as appointed by the Chairman of Siena.

    (B) Change in Control. A "Change in Control" shall mean a change in control
    of a nature that would be required to be reported in response to item 6(e)
    of Schedule 14A of Regulation 14A promulgated under the Exchange Act as such
    Schedule, Regulation and Act were in effect on the date of adoption of this
    Plan by the Board, assuming that such Schedule, Regulation and Act applied
    to the Company, provided that such a change in control shall be deemed to
    have occurred at such time as:

        (I) any "person" (as that term is used in Section 13(d) and 14(d)(2) of
        the Exchange Act) (other than Siena Holdings, Inc. or an affiliate of
        Siena Holdings, Inc.) becomes, directly or indirectly, the "beneficial
        owner" (as defined in Rule 13d-3 under the Exchange Act) of securities
        representing a 30% or more of the combined voting power for election of
        members of the Board of the then outstanding voting securities of the
        Company or any successor of the Company;

        (II) during any period of two (2) consecutive years or less, individuals
        who at the beginning of such period constituted the Board of the Company
        cease, for any reason, to constitute at least a majority of the Board,
        unless the election or nomination for 


                                      -1-
<PAGE>   2

        election of each new member of the Board was approved by a vote of at
        least two-thirds of the members of the Board then still in office who
        were members of the Board at the beginning of the period;

        (III) the equity-holders of the Company approve any merger or
        consolidation to which the Company is a party as a result of which the
        persons who were equity-holders of the Company immediately prior to the
        effective date of the merger or consolidation (and excluding, however,
        any shares held by any party to such merger or consolidation and their
        affiliates) shall have beneficial ownership of less than 50% of the
        combined voting power for election of members of the Board (or
        equivalent) of the surviving entity following the effective date of such
        merger or consolidation; or

        (IV) the equity-holders of the Company approve any merger or
        consolidation as a result of which the equity interests in the Company
        shall be changed, converted or exchanged (other than a merger with a
        wholly-owned subsidiary of the Company) or any liquidation of the
        Company or any sale or other disposition of 50% or more of the assets or
        earnings power of the Company;

    (C.) Code. The Internal Revenue Code of 1986, as amended.

    (D) Compensation Committee or Committee. The Committee, which shall be
    comprised of three or more members who shall be appointed by the Board to
    administer this Agreement, which the Board shall have the power to fill
    vacancies on the Committee arising by resignation, death, removal or
    otherwise. In the absence of a Committee, reference thereto shall be to the
    Board.

    (E) Common Stock. Siena Holdings, Inc. Class A Common Stock, which the
    Company is authorized to issue or may in the future be authorized to issue.

    (F) Company. Siena Holdings, Inc. ("Siena"), its subsidiaries and any
    successor corporation.

    (G) Disability. Any complete and permanent disability as defined in Section
    22(e)(3) of the Code and determined in accordance with the procedures set
    forth in the regulations thereunder.

    (H) Officer. Any officer of the Company or any Parent or Subsidiary, who, in
    the opinion of the Committee, is one of a select group of executive
    officers, other officers or other key management personnel of the Company or
    any Parent or Subsidiary who is in a position to contribute materially to
    the continued growth and development and to the continued financial success
    of the Company or any Parent or Subsidiary, including executive officers and
    officers who are members of the Board.


                                       -2-
<PAGE>   3

    (I) Exchange Act. The Securities Exchange Act of 1934, as amended.

    (J) Fair Market Value. The closing sales price of the Common Stock as
    reported or listed on a national securities exchange on any relevant date
    for valuation, or, if there is no such sale on such date, the applicable
    prices as so reported on the nearest preceding date upon which such sale
    took place. In the event the shares of Common Stock are not listed on a
    national securities exchange, the Fair Market Value of such shares shall
    initially; be based upon the book value of the Company on June 30, 1997
    which includes adjustments to reflect the market value of the assets and
    liabilities pursuant to generally accepted accounting principles, thereafter
    shall be determined by the Committee in its sole discretion.

    (K) Grantee. Any Officer or Director of the Company who in the opinion of
    the Committee performs significant services for the benefit of the Company
    and who is granted a Stock Option under this Agreement.

    (L) Involuntary Termination. The termination of Grantee's retention by Siena
    other than for death, Disability, Retirement, Terminated for Cause,
    Terminated for Good Reason, or in the event of a Change of Control (as
    defined in Section 2(B) above).

    (M) Retirement. The termination of retention by the Company or any Parent or
    Subsidiary constituting retirement as determined by the Committee.

    (N) Stock Option. A Non-Qualified Stock Option granted by the Committee to a
    Grantee under this Agreement.

    (O) Subsidiary. Any corporation (whether now or hereafter existing) which
    constitutes a "subsidiary" of the Company, as defined in Section 424(f) of
    the Code.

    (P) Termination for Cause. An Officer shall be deemed Terminated for Cause
    if he or she is terminated as a result of a breach of his or her written
    retention agreement.

    (Q) Termination for Good Reason. The resignation of an Officer shall be
    deemed to be a Termination for Good Reason if the Officers resignation is
    within two years of a Change in Control as defined in Section 2(B) above,
    caused by and within ninety (90) days of the following: (I) without the
    express written consent of the Officer, any duties that are assigned which
    are materially inconsistent with the Officer's position, duties and status
    with Siena at the time of the Change in Control; (ii) any action by Siena
    which results in a material diminution in the position, duties or status of
    the Officer with Siena at the time of the Change in Control or any transfer
    or proposed transfer of the Officer for any extended period to a location
    outside his principal place of retention at the time of the Change in
    Control without his consent; (iii) the base annual compensation of the
    Officer, as same may be hereafter be increased from time to time, is
    reduced; or (iv) without limiting the generality or effect of the foregoing,
    Siena fails to comply with any of its material obligations hereunder.


                                      -3-
<PAGE>   4

3.  VESTING: TIME OF EXERCISE. Except as specifically provided in this Agreement
    and subject to certain terms, restrictions and conditions set forth in this
    Agreement, this Stock Option is exercisable in the following cumulative
    installments:

    First installment.                      Up to 20% of the total Stock Options
                                            at any time following the first
                                            anniversary of the Date of Grant.

    Second installment.                     Up to an additional 20% of the total
                                            Stock Options at any time following
                                            the second anniversary of the Date
                                            of Grant.

    Third installment.                      Up to an additional 20% of the total
                                            Stock Options at any time following
                                            the third anniversary of the Date of
                                            Grant.

    Fourth installment.                     Up to an additional 20% of the total
                                            Stock Options at any time following
                                            the forth anniversary of the Date of
                                            Grant.

    Fifth installment.                      Up to an additional 20% of the total
                                            Stock Options at any time following
                                            the fifth anniversary of the Date of
                                            Grant.

4.  TERM; FORFEITURE. This Stock Option, and all unexercised Stock Options
    granted hereunder, will terminate and be forfeited at the first of the
    following to occur;

    (A) 5:00 pm on December 1, 2007; or

    (B) 5:00 pm on the date which is twelve (12) months following termination of
    service due to death, Disability or six (6) months after Retirement for
    Stock Options vested at termination; or

    (C.) 5:00 pm on the date which is twelve (12) months following termination
    of service due to death, Disability or six (6) months after Retirement for
    Stock Options that vest after termination; or

    (D) 5:00 pm on the 31st day after the day of any other termination of
    service.

    (E) For purposes of termination of service due to death or Disability, any
    non-vested portion of any outstanding Stock Option shall become vested and
    immediately and fully exercisable, notwithstanding any provision therein for
    the exercise in installments.

    (F) For purposes of termination of service due to Retirement, any non-vested
    portion of any outstanding Stock Options shall become vested and immediately
    and fully exercisable, notwithstanding any provision therein for the
    exercise in installments. immediately.

    (G) For purposes of termination of service as a result of Involuntary
    Termination (not 


                                      -4-
<PAGE>   5

    Change in Control), any non-vested portion of any outstanding Stock Options
    shall vest on a pro-rata basis based upon the number of months the
    terminated Officer has been retained within the applicable vesting schedule
    of this Agreement.

    (H) In the event of Involuntary Termination or Termination for Good Reason
    within two years of a Change in Control, all Stock Options then outstanding
    shall become vested and immediately and fully exercisable, notwithstanding
    any provision therein for the exercise in installments.

5.  WHO MAY EXERCISE. Subject to the terms and conditions set forth in Sections
    3 and 4 above, this Stock Option may be exercised only by Grantee. If as a
    result of death or Disability prior to the termination date specified in
    Section 4(A) hereof and Grantee have not exercised this Stock Option as to
    the maximum percentage of Stock Options set forth in Section 3 hereof as of
    the date of death of Disability, the following persons may exercise the
    exercisable portion of this Stock Option on behalf of Grantee at any time
    prior to the earlier of the dates specified in Sections 4(A) or (B) hereof:
    (i) if Grantee is disabled, your guardian; or (ii) if Grantee dies, the
    personal representative of your estate, or the person who acquired the right
    to exercise this Stock Option by bequest or inheritance or by reason of
    Grantees death; provided that this Stock Option shall remain subject to the
    other term of this Agreement, and applicable laws, rules, and regulations.

6.  RESTRICTIONS. This Stock Option may be exercised only with respect to full
    shares and no fractional share of stock shall be issued.

7.  MANNER OF EXERCISE. Subject to such rules as the Board or the Committee may
    from time to time adopt, this Stock Option may be exercised by the delivery
    of written notice to the Secretary of the Company setting forth the number
    of shares of Common Stock with respect to which the Stock Option is to be
    exercised and the date of exercise thereof (the "Exercise Date") which shall
    be at least three (3) days after giving such notice unless an earlier time
    shall have been mutually agreed upon.

    On the Exercise Date, Grantee shall deliver to the Company consideration
    with a value equal to the total Option Price of the shares to be purchased,
    payable as follows: (i) cash, certified check, bank draft, or money order
    payable to the order of the Company, and/or (ii) any other form of payment
    which is acceptable to the Committee.

    Common Stock which is acquired by Grantee pursuant to the exercise of this
    Stock Option may not b used to exercise a subsequent option until and unless
    such shares have been held for a period of six months.

    Upon payment of all amounts due, the Company shall cause certificates for
    the Common Stock then being purchased to be delivered to Grantee (or the
    person exercising Stock Option in the event of your death of Disability) at
    its principal business office promptly after the 


                                      -5-
<PAGE>   6

    Exercise date. The obligation of the Company to deliver shares of Common
    Stock shall, however, be subject to the condition that if at any time the
    Committee shall determine in its sole discretion that the listing,
    registration, or qualification of the Stock Option or the Common Stock upon
    any securities exchange or under any state of federal law, or the consent or
    approval of any governmental regulatory body, is necessary or desirable as a
    condition of, or in connection with, the Stock Option or the issuance or
    purchase of shares of Common Stock thereunder, then the Stock Option may not
    be exercised in whole or in part unless such, listing, registration,
    qualification, consent, or approval shall have been effected or obtained
    free of any conditions not acceptable to the Committee.

    If Grantee fails to pay for any of the Common Stock specified in such notice
    or fail to accept delivery thereof, then your right to purchase such Common
    Stock may be terminated by the Company.

8.  TAX WITHHOLDING. The Company shall have the right to deduct from all amounts
    hereunder paid in cash or other form, any Federal, state or local taxes
    required by law to be deducted. As a requirement for receiving shares of
    Common Stock issued under this Stock Option, Grantee will be required to pay
    the Company the amount of any taxes which the Company is required to
    withhold with respect to such shares of Common Stock. Such payments shall be
    required to be made before the delivery of any certificate representing such
    shares of Common Stock will be issued. The Committee may determine such
    payment can be made in cash, by check, or through the delivery of shares of
    Common Stock owned by Grantee (which may be effected by the actual delivery
    of shares of Common Stock by Grantee or if Grantee is not an insider (as
    defined by the Securities and Exchange Commission), by the Company's
    withholding a number of shares to be issued upon exercise of this Stock
    Option, if applicable), which shares have an aggregate Fair Market Value
    equal to the required minimum withholding payment , or any combination
    thereof.

9.  NON-ASSIGNABILITY. This Stock Option is not assignable or transferable
    except by will or the laws of descent and distribution or pursuant to a
    qualified domestic relations order as defined in the Code or Title I of the
    Employee Retirement Income Security Act of 1974, as amended. However, after
    Grantee has shown reasonable evidence of tax and/or financial advice from a
    third-party, Grantee may make an irrevocable gift of the Stock Option to a
    family member or trust.

10. RIGHTS AS STOCKHOLDER. You will have no rights as a stockholder with respect
    to any shares covered by this Stock Option until the issuance of a
    certificate or certificates to Grantee for the shares. No adjustment shall
    be made for dividends or other rights for which the record date is prior to
    the issuance of such certificate of certificates.

11. ADJUSTMENT OF NUMBER OF SHARES AND RELATED MATTERS. The number of shares of
    Common Stock covered by this Stock Option, and the Option Price thereof,
    shall be subject to adjustment in accordance with change in capitalization
    of Siena Holdings, Inc. or a 


                                      -6-
<PAGE>   7

    combination, merger, or reorganization of Siena Holdings, Inc. into or with
    any other corporation or any other transaction with similar effects.

12. GRANTEE'S REPRESENTATIONS. Notwithstanding any of the provisions hereof,
    Grantee hereby agrees that Grantee will not exercise the Stock Option
    granted hereby, and that the Company will not be obligated to issue any
    shares to Grantee hereunder, if the exercise thereof or the issuance of such
    shares shall constitute a violation by Grantee or the Company of any
    provision of any law or regulation of any governmental authority. Any
    determination in this connection by the Committee shall be final, binding
    and conclusive. The obligations of the Company and your rights are subject
    to all applicable laws, rules and regulations.

    Furthermore, if Grantee is an "insider" (as defined by the Securities
    Exchange Commission), Grantee agrees that Grantee will not exercise this
    Stock Option during the six (6) months following the Date of Grant.

13. INVESTMENT REPRESENTATION. Unless the Common Stock is issued to Grantee in a
    transaction registered under applicable Federal and state securities laws,
    by Grantees execution hereof, Grantee represents and warrants to the Company
    that all Common Stock which may be purchased hereunder will be acquired by
    Grantee for investment purposes for your own account and not with any intent
    for resale or distribution in violation of Federal or state securities laws.
    Unless the Common Stock is issued to you in a transaction registered under
    the applicable Federal and state securities laws, all certificates issued
    with respect to the Common Stock shall bear an appropriate restrictive
    investment legend.

14. PARTICIPANT'S ACKNOWLEDGMENTS. As a Grantee under this Agreement, Grantee
    acknowledges receipt of a copy of this Agreement, and represents that
    Grantee is familiar with the terms and provisions of this Agreement. By
    signing this Agreement, Grantee hereby accepts as binding, conclusive, and
    final all decisions or interpretations of the Committee, as that term is
    defined in this Agreement, upon any questions arising under this Agreement.
    Any disagreement by Grantee as to any decision or interpretation of the
    Committee shall be settled exclusively by the terms of this Agreement.

15. LAW GOVERNING. This Agreement shall be governed by, construed, and enforced
    in accordance with the laws of the State of Delaware (excluding any conflict
    of laws rule or principle of Delaware law that might refer the governance,
    construction, or interpretation of this agreement to the laws of another
    state).

    In the event of any change in applicable laws or any change in circumstances
    which results in or would result in any dilution of the rights granted under
    this Agreement, or which otherwise warrants equitable adjustment because it
    interferers with the intended operation of this Agreement, then if the
    Committee shall, in its sole discretion, determine that such change requires
    an adjustment in the number or kind of shares of stock or other securities
    or property theretofore subject, or which may become subject, to issuance or
    transfer under this 


                                      -7-
<PAGE>   8

    Agreement or in the terms and conditions of this Agreement, such adjustment
    shall be made in accordance with such determination. The Committee shall
    give notice to each Grantee, and upon notice such adjustment shall be
    effective and binding for all purposes of this Agreement.

16. NO RIGHT TO CONTINUE RETENTION. Nothing herein shall be construed to confer
    upon Grantee the right to continue in the retention of the Company or any
    Subsidiary or interfere with or restrict in any way the right of the Company
    or any Subsidiary to discharge Grantee at any time (subject to any contract
    rights Grantee might have).

17. LEGAL CONSTRUCTION. In the event that any one or more of the terms,
    provisions or agreements that are contained in this Agreement shall be held
    by a Court of competent jurisdiction to be invalid, illegal or unenforceable
    in any respect for any reason, the invalid, illegal or unenforceable term,
    provision or agreement shall not affect any other term, provision or
    agreement that is contained in this Agreement and this Agreement shall be
    construed in all respects as if the invalid, illegal or unenforceable term,
    provision or agreement had never been contained herein.

18. ENTIRE AGREEMENT. This Agreement supersede any and all other prior
    understandings and agreements, either oral or in writing, between the
    parties with respect to the subject matter hereof and constitute the sole
    and only agreements between the parties with respect to the said subject
    matter. All prior negotiations and agreements between the parties with
    respect to the subject matter hereof are merged into this Agreement. Each
    party to this Agreement acknowledges that no representations, inducements,
    promises or agreements, orally or otherwise, have been made by any party or
    by anyone acting on behalf of any party, which are not embodied in this
    Agreement and that any agreement, statement or promise that is not contained
    in this Agreement shall not be valid or binding or of any force or effect.

19. PARTIES BOUND. The terms, provisions, representations, warranties,
    covenants, and agreements that are contained in this Agreement shall apply
    to, be binding upon, and inure to the benefit of the parties and their
    respective heirs, executors, administrators, legal representatives, and
    permitted successors and assigns.

20. MODIFICATION. No change or modification of this Agreement shall be valid or
    binding upon the parties unless the change or modification is in writing and
    signed by the parties. Notwithstanding the preceding sentence, the Company
    may amend this Agreement or revoke this Stock Option to the extent permitted
    in this Agreement.

21. HEADINGS. The headings that are used in this Agreement are used for
    reference and convenience purposes only and do not constitute substantive
    matters to be considered in construing the terms and provisions of this
    Agreement.

22. NOTICE. Any notice required or permitted to be delivered hereunder shall be
    deemed to be 


                                      -8-
<PAGE>   9

    delivered only when actually received by the Company or by Grantee, as the
    case may be, at the addresses set forth below, or at such other addresses as
    they have theretofore specified by written notice delivered in accordance
    herewith.

         (A)  Notice to the Company shall be addressed and delivered as follows:

                              Siena Holdings, Inc.
                               Attention: Chairman
                        5068 W. Plano Parkway, Suite 345
                                 Plano, TX 75093

         (B)  Notice to Grantee shall be addressed and delivered as follows:

                                   Frank Ryan
                          Route 121, Houghtonville Road
                                   PO Box 185
                                Grafton, VT 05146


IN WITNESS WHEREOF, the Company has caused this Agreement to be executed by its
duly authorized officer, and Grantee, to evidence Grantees consent and approval
of all the terms hereof, has duly executed this Agreement, as of the date
specified in Section 1 hereof.



SIENA HOLDINGS, INC.


BY: /s/ W. JOSEPH DRYER                                    
   --------------------------

TITLE: PRESIDENT                                                 
      -----------------------

GRANTEE:

 /s/ FRANK B. RYAN                                              
-----------------------------


                                      -9-