SONUS CORP.

                           SECOND AMENDED AND RESTATED

                                STOCK AWARD PLAN

                         (AS AMENDED FEBRUARY 11, 2000)

                                   ARTICLE 1

                            ESTABLISHMENT AND PURPOSE

         1.1   ESTABLISHMENT;    AMENDMENT   AND   RESTATEMENT.    Sonus   Corp.
("Corporation")  established  the Sonus  Corp.  Stock  Award Plan (the  "Plan"),
effective as of December 10, 1996,  subject to shareholder  approval as provided
in  Article  16 of the  Plan.  The  Plan was  previously  amended  and  restated
effective  February 5, 1997, was further amended and restated  effective October
15, 1997, was further amended effective December 18, 1997, and October 26, 1998,
and most  recently has been  amended to increase  the number of Shares  issuable
hereunder  from  2,300,000  Shares to 2,500,000  Shares,  subject to shareholder
approval at Corporation's 2000 annual meeting of shareholders.

         1.2  PURPOSE.  The  purpose of the Plan is to promote  and  advance the
interests of Corporation and its  shareholders  by enabling  Corporation and its
subsidiaries  to  attract,  retain,  and reward key  employees,  directors,  and
outside  consultants.  It is  also  intended  to  strengthen  the  mutuality  of
interests  between  such  employees,  directors,  and  outside  consultants  and
Corporation's shareholders. The Plan is designed to meet this intent by offering
stock  options and other  equity-based  incentive  awards,  thereby  providing a
proprietary  interest in  pursuing  the  long-term  growth,  profitability,  and
financial success of Corporation.

                                   ARTICLE 2
                                  DEFINITIONS

         2.1 DEFINED TERMS.  For purposes of the Plan, the following terms shall
have the meanings set forth below:

         "AWARD" means an award or grant made to a Participant of Options, Stock
Appreciation Rights,  Restricted Units, Performance Awards, or Other Stock-Based
Awards pursuant to the Plan.

         "AWARD  AGREEMENT"  means an  agreement  as  described  in Section  6.4
evidencing an Award granted under the Plan.

         "BOARD" means the Board of Directors of Corporation.

         "CODE"  means the  Internal  Revenue  Code of 1986,  as amended  and in
effect  from  time to time,  or any  successor  thereto,  together  with  rules,
regulations,  and interpretations  promulgated thereunder.  Where the context so
requires, any reference to a particular Code section shall be construed to refer
to the successor provision to such Code section.

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         "CONSULTANT"  means any  consultant  or  adviser  to  Corporation  or a
Subsidiary who is not an employee of  Corporation or a Subsidiary,  but does not
include any person involved in a capital-raising  or investor relations activity
on behalf of the Corporation.

         "CONTINUING  RESTRICTION"  means a  Restriction  contained  in Sections
15.4, 15.6, and 15.7 of the Plan and any other Restrictions expressly designated
by the Board in an Award Agreement as a Continuing Restriction.

         "CORPORATION" means Sonus Corp., an Alberta, Canada,  corporation as it
may be continued to the Yukon Territories, or any successor corporation.

         "DISABILITY" means the condition of being "disabled" within the meaning
of Section  22(e)(3) of the Code.  However,  the Board may change the  foregoing
definition of "Disability"  or may adopt a different  definition for purposes of
specific Awards.

         "DOLLARS" OR "$" means United States dollars.

         "EXCHANGE  ACT" means the  Securities  Exchange Act of 1934, as amended
and in effect from time to time, or any successor statute.  Where the context so
requires,  any reference to a particular  section of the Exchange Act, or to any
rule  promulgated  under  the  Exchange  Act,  shall  be  construed  to refer to
successor provisions to such section or rule.

         "FAIR  MARKET  VALUE" of a Share on a  particular  day  means,  without
regard to any  Restrictions,  the mean  between the  reported  high and low sale
prices,  or, if there is no sale on such day,  the mean between the reported bid
and asked  prices,  for that day, of Shares on that day or, if that day is not a
trading day, the last prior trading day, on the principal securities exchange or
automated  securities  interdealer  quotation  system on which such Shares shall
have been traded.

         "INCENTIVE  STOCK OPTION" or "ISO" means any Option granted pursuant to
the Plan that is  intended  to be and is  specifically  designated  in its Award
Agreement as an "incentive  stock  option"  within the meaning of Section 422 of
the Code.

         "NONEMPLOYEE  DIRECTOR"  means  a  member  of the  Board  who is not an
employee of Corporation or a Subsidiary.

         "NONQUALIFIED OPTION" or "NQO" means any Option granted pursuant to the
Plan that is not an Incentive Stock Option.

         "OPTION" means an ISO or an NQO.

         "OTHER STOCK-BASED AWARD" means an Award as described in Section 11.1.

         "PARTICIPANT"  means an  employee or  Consultant  of  Corporation  or a
Subsidiary or a Nonemployee Director who is granted an Award under the Plan.

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         "PERFORMANCE  AWARD" means an Award granted  pursuant to the provisions
of Article 10 of the Plan,  the Vesting of which is  contingent on attaining one
or more Performance Goals.

         "PERFORMANCE  CYCLE" means a designated  performance period pursuant to
the provisions of Section 10.3 of the Plan.

         "PERFORMANCE GOAL" means a designated performance objective pursuant to
the provisions of Section 10.4 of the Plan.

         "PLAN" means this Sonus Corp. Stock Award Plan, as amended and restated
as set forth herein and as it may be hereafter amended from time to time.

         "REPORTING  PERSON" means a Participant who is subject to the reporting
requirements of Section 16(a) of the Exchange Act.

         "RESTRICTED  UNIT"  means an Award of stock units  representing  Shares
described in Section 9.1 of the Plan.

         "RESTRICTION"  means a provision  in the Plan or in an Award  Agreement
which  limits  the  exercisability  or  transferability,  or which  governs  the
forfeiture,  of an Award or the Shares, cash, or other property payable pursuant
to an Award.

         "RETIREMENT" means:

              (a) For  Participants  who are employees,  retirement  from active
         employment with Corporation and its Subsidiaries at or after age 65, or
         such earlier  retirement  date as approved by the Board for purposes of
         the Plan;

              (b) For Participants who are Nonemployee Directors, termination of
         membership  on the  Board  after  attaining  age 65,  or  such  earlier
         retirement date as approved by the Board for purposes of the Plan; and

              (c) For individual  Participants who are Consultants,  termination
         of service as a Consultant  after  attaining a retirement age specified
         by the Board for purposes of an Award to such Consultant.

However,  the Board may change the foregoing  definition of  "Retirement" or may
adopt a different definition for purposes of specific Awards.

         "SHARES"  means  the  Common  Shares  without  nominal  or par value of
Corporation or any security of Corporation issued in substitution,  exchange, or
in lieu of such securities.

         "STOCK APPRECIATION RIGHT" or "SAR" means an Award described in Article
8 of the Plan.

         "STOCK OPTION PLAN" means the Corporation's incentive stock option plan
adopted effective November 18, 1993.

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         "SUBSIDIARY" means a "subsidiary corporation" of Corporation within the
meaning of Section 425 of the Code,  namely any corporation in which Corporation
directly or indirectly  controls 50 percent or more of the total combined voting
power of all classes of stock having voting power.

         "VEST" or "VESTED" means:


              (a) In the case of an Award that  requires  exercise,  to be or to
         become  immediately and fully  exercisable and free of all Restrictions
         (other than Continuing Restrictions);

              (b) In the case of an Award that is subject to  forfeiture,  to be
         or to  become  nonforfeitable,  freely  transferable,  and  free of all
         Restrictions (other than Continuing Restrictions);

              (c) In the case of an  Award  that is  required  to be  earned  by
         attaining  specified  Performance  Goals, to be or to become earned and
         nonforfeitable,  freely  transferable,  and  free  of all  Restrictions
         (other than Continuing Restrictions); or

              (d) In the case of any  other  Award as to  which  payment  is not
         dependent solely upon the exercise of a right,  election, or option, to
         be or to  become  immediately  payable  and  free  of all  Restrictions
         (except Continuing Restrictions).

         2.2 GENDER AND NUMBER. Except where otherwise indicated by the context,
any  masculine or feminine  terminology  used in the Plan shall also include the
opposite  gender;  and the definition of any term in Section 2.1 in the singular
shall also include the plural, and vice versa.

                                   ARTICLE 3
                                 ADMINISTRATION

         3.1  GENERAL.  Except as  provided  in Section  3.2,  the Plan shall be
administered by the Board.

         3.2  COMMITTEE. The Board may delegate  administration of the Plan to a
committee of two or more Nonemployee Directors. In the event the Board delegates
administration to such a committee, the committee will have all the authority of
the Board with respect to  administration  of the Plan, other than the authority
to  grant  Awards  to  Nonemployee  Directors,   which  authority  shall  reside
exclusively  with the  Board,  and  subject  to any  additional  limits  on such
delegation imposed by the Board.

         3.3  AUTHORITY  OF THE  BOARD.  The Board  shall  have  full  power and
authority to administer the Plan in its sole discretion, including the authority
to:

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              (a) Construe and interpret the Plan and any Award Agreement;

              (b) Promulgate,  amend, and rescind rules and procedures  relating
         to the implementation of the Plan;

              (c) With respect to Participants:

                   (i)  Select  the  employees,   Nonemployee   Directors,   and
              Consultants who will be granted Awards;

                   (ii)  Determine  the number and types of Awards to be granted
              to each Participant;

                   (iii) Determine the number of Shares,  or Share  equivalents,
              to be subject to each Award;

                   (iv) Determine the option price,  purchase price, base price,
              or similar feature for any Award; and

                   (v)  Determine  all the  terms  and  conditions  of all Award
              Agreements,  consistent  with  the  requirements  of the  Plan and
              subject to approval,  to the extent  required,  by any  regulatory
              authority having jurisdiction over Awards granted under the Plan.

Decisions of the Board, or any delegate as permitted by the Plan, will be final,
conclusive, and binding on all Participants.

         3.4 LIABILITY OF BOARD  MEMBERS.  No member of the Board will be liable
for any action or determination made in good faith with respect to the Plan, any
Award, or any Participant.

         3.5 COSTS OF PLAN.  The costs and  expenses of  administering  the Plan
will be borne by Corporation.

                                   ARTICLE 4
               DURATION OF THE PLAN AND SHARES SUBJECT TO THE PLAN

         4.1 DURATION OF THE PLAN.  The Sonus Corp.  Stock Award Plan  initially
became  effective  December  10,  1996,  subject to  approval  by  Corporation's
shareholders  as  provided  in Article 16 of the Plan.  The Plan will  remain in
effect until Awards have been granted  covering all the available  Shares or the
Plan is  otherwise  terminated  by the Board.  Termination  of the Plan will not
affect outstanding Awards.

         4.2 Shares Subject to the Plan.

         4.2.1 GENERAL. The shares which may be made subject to Awards under the
Plan  are  Shares,  which  may be  either  authorized  and  unissued  Shares  or
reacquired Shares. No fractional Shares may be issued under the Plan.

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         4.2.2 MAXIMUM NUMBER OF SHARES.  The maximum number of Shares for which
Awards may be granted under the Plan is 2,500,000 Shares,  subject to adjustment
pursuant to Article 13 of the Plan;  provided that the maximum  number of Shares
issuable under the Plan may not exceed the number  permitted by the regulations,
guidelines or policies of any regulatory  authority having jurisdiction over the
issuance of Shares pursuant to the Plan.

         4.2.3 AVAILABILITY OF SHARES FOR FUTURE AWARDS.   If an Award under the
Plan is canceled or expires for any reason  prior to having been fully Vested or
exercised  by a  Participant  or is  settled  in cash in  lieu of  Shares  or is
exchanged  for other  Awards,  all Shares  covered by such  Awards  will be made
available for future Awards under the Plan. Furthermore, any Shares covered by a
Stock  Appreciation  Right  which  are not  issued  upon  exercise  will  become
available for future Awards.

                                   ARTICLE 5
                                  ELIGIBILITY

         Officers and other key employees of  Corporation  and its  Subsidiaries
(who may also be directors of  Corporation or a  Subsidiary),  Consultants,  and
Nonemployee Directors who, in the Board's judgment,  are or will be contributors
to the  long-term  success of  Corporation  shall be eligible to receive  Awards
under the Plan.

                                   ARTICLE 6
                                     AWARDS

         6.1  TYPES OF AWARDS. The types of Awards that may be granted under the
Plan are:

         (a) Options governed by Article 7 of the Plan;

         (b) Stock Appreciation Rights governed by Article 8 of the Plan;

         (c) Restricted Units governed by Article 9 of the Plan;

         (d) Performance Awards governed by Article 10 of the Plan; and

         (e) Other Stock-Based  Awards or combination Awards governed by Article
    11 of the Plan.

In the discretion of the Board,  any Award may be granted alone, in addition to,
or in tandem with other Awards under the Plan.

         6.2  GENERAL.  Subject to the  limitations  of the Plan,  the Board may
cause Corporation to grant Awards to such  Participants,  at such times, of such
types,  in such amounts,  for such periods,  with such option  prices,  purchase
prices, or base prices, and subject to such terms, conditions,  limitations, and
restrictions as the Board, in its discretion,  deems appropriate;  provided that
all Awards  granted  under the Plan are subject to  approval  by any  regulatory
authority  having  jurisdiction  over such  grants.  Awards  may be  granted  as
additional  compensation  to a Participant or in lieu of other  compensation  to
such  Participant.  A Participant

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may receive  more than one Award and more than one type of Award under the Plan,
subject to approval,  to the extent required, by any regulatory authority having
jurisdiction over Awards granted under the Plan.

         6.3  NONUNIFORM  DETERMINATIONS. The Board's  determinations  under the
Plan or under one or more Award Agreements,  including,  without limitation, the
selection of Participants to receive Awards,  the type, form, amount, and timing
of  Awards,   the  terms  of  specific  Award  Agreements,   and  elections  and
determinations made by the Board with respect to exercise or payments of Awards,
need not be uniform and may be made by the Board selectively among  Participants
and Awards, whether or not Participants are similarly situated.

         6.4  AWARD AGREEMENTS.  Each Award will be evidenced by a written Award
Agreement between Corporation and the Participant. Award Agreements, or the form
thereof, must be approved by the Board and may, subject to the provisions of the
Plan, contain any provision approved by the Board,  subject to approval,  to the
extent required,  by any regulatory  authority having  jurisdiction  over Awards
granted under the Plan.

         6.5  PROVISIONS GOVERNING ALL AWARDS. All Awards will be subject to the
following provisions:

         (a)  ALTERNATIVE  AWARDS.  If any Awards are  designated in their Award
    Agreements as alternative to each other,  the exercise of all or part of one
    Award   automatically   will  cause  an   immediate   equal  (or  pro  rata)
    corresponding termination of the other alternative Award or Awards.

         (b)  RIGHTS AS  SHAREHOLDERS. No Participant  will have any rights of a
    shareholder with respect to Shares subject to an Award until such Shares are
    issued in the name of the Participant.

         (c)  EMPLOYMENT  RIGHTS.  Neither  the  adoption  of the  Plan  nor the
    granting  of any Award  will  confer on any  person  the right to  continued
    employment  with  Corporation  or any Subsidiary or the right to remain as a
    director of or a consultant to  Corporation or any  Subsidiary,  as the case
    may be, and will not interfere in any way with the right of Corporation or a
    Subsidiary to terminate such person's employment or to remove such person as
    a  Consultant  or as a director at any time for any reason or for no reason,
    with or without cause.

         (d)  TERMINATION OF EMPLOYMENT. The terms and conditions under which an
    Award may be exercised,  if at all,  after a  Participant's  termination  of
    employment  or service  as a  Nonemployee  Director  or  Consultant  will be
    determined by the Board and  specified in the  applicable  Award  Agreement,
    subject to approval,  to the extent  required,  by any regulatory  authority
    having jurisdiction over Awards granted under the Plan.

         (e)  CHANGE IN CONTROL.  The Board, in its  discretion,  may provide in
    any Award  Agreement that in the event of a change in control of Corporation
    (as the Board may define such term in the Award  Agreement),  as of the date
    of such change in control:

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              (i)   All, or a specified  portion of, Awards  requiring  exercise
         will become  fully and  immediately  exercisable,  notwithstanding  any
         other limitations on exercise;

              (ii)  All,  or  a  specified   portion  of,   Awards   subject  to
         Restrictions will become fully Vested; and

              (iii) All,  or  a  specified   portion  of,   Awards   subject  to
         Performance Goals will be deemed to have been fully earned.

    The Board,  in its discretion,  may include change in control  provisions in
    some Award  Agreements and not in others,  may include  different  change in
    control provisions in different Award Agreements,  and may include change in
    control provisions for some Awards or some Participants and not for others.

         (f)  REPORTING  PERSONS.  Notwithstanding  anything  in the Plan to the
    contrary, the Board, in its sole discretion, may bifurcate the Plan so as to
    restrict,  limit,  or  condition  the use of any  provision  of the  Plan to
    Participants who are Reporting  Persons without so restricting,  limiting or
    conditioning the Plan with respect to other Participants.

         (g)  SERVICE  PERIODS.  At the time of granting  Awards,  the Board may
    specify,  by resolution or in the Award Agreement,  the period or periods of
    service  performed or to be performed by the  Participant in connection with
    the grant of the Award.

         (h)  NONTRANSFERABILITY.  Each  Award  shall  not  be  transferable  or
    assignable  otherwise  than by will or the laws of descent and  distribution
    and shall be  exercisable  (if exercise is required)  during the lifetime of
    the  Participant,  only by the  Participant or, in the event the Participant
    becomes  legally  incompetent,   by  the  Participant's  guardian  or  legal
    representative.

                                   ARTICLE 7
                                    OPTIONS

         7.1  TYPES OF  OPTIONS.  Options  granted  under the Plan may be in the
form of  Incentive  Stock  Options or  Nonqualified  Options.  The grant of each
Option and the Award Agreement governing each Option will identify the Option as
an ISO or an NQO.  In the event the Code is amended to provide  for  tax-favored
forms of stock options other than or in addition to Incentive Stock Options, the
Board may grant Options under the Plan meeting the requirements of such forms of
options.

         7.2  GENERAL.  Options will be subject to the terms and  conditions set
forth  in  Article  6 of the  Plan  and  this  Article  7 and may  contain  such
additional terms and conditions, not inconsistent with the express provisions of
the Plan, as the Board deems  desirable,  subject to approval by any  regulatory
authority having jurisdiction over Awards granted under the Plan.

         7.3 OPTION  PRICE.  Each Award  Agreement  for  Options  will state the
option  exercise price per Share of Common Stock  purchasable  under the Option,
which will not be less than:

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         (a) 75 percent of the Fair Market Value of a Share on the date of grant
    for all Nonqualified Options; or

         (b) 100  percent  of the  Fair  Market  Value of a Share on the date of
    grant for all Incentive Stock Options;

provided  that at no time  shall the option  exercise  price of an Option at the
date of grant be  greater  or less than that  permitted  under the  regulations,
guidelines or policies of any  regulatory  authority  having  jurisdiction  over
Awards granted under the Plan.

         7.4  OPTION TERM. The Award  Agreement for each Option will specify the
term  during  which the Option may be  exercised,  as  determined  by the Board,
subject to approval by any regulatory  authority having jurisdiction over Awards
granted under the Plan.

         7.5 TIME OF EXERCISE. The Award Agreement for each Option will specify,
as determined by the Board:

         (a) The time or times  when the  Option  will  become  exercisable  and
    whether the Option will become  exercisable in full or in graduated  amounts
    over a period specified in the Award Agreement;

         (b) Such  other  terms,  conditions,  and  restrictions  as to when the
    Option may be exercised as are determined by the Board; and

         (c) The extent,  if any,  to which the Option  will remain  exercisable
    after the  Participant  ceases to be an employee,  Consultant or Nonemployee
    Director of Corporation or a Subsidiary;

in  each  case,   subject  to  approval  by  any  regulatory   authority  having
jurisdiction  over Awards  granted  under the Plan.  An Award  Agreement  for an
Option may, in the discretion of the Board, provide whether, and to what extent,
the Option will become immediately and fully exercisable (i) in the event of the
death, Disability, or Retirement of the Participant, or (ii) upon the occurrence
of a change in control of Corporation.

         7.6  METHOD OF  EXERCISE.  The Award  Agreement  for each  Option  will
    specify  the method or methods of payment  acceptable  upon  exercise  of an
    Option.  An Award  Agreement may provide that the option price is payable in
    full in cash or, at the  discretion  of the Board,  by  delivery  (in a form
    approved by the Board) of an  irrevocable  direction to a securities  broker
    acceptable  to the Board (i) to sell  Shares  subject  to the  Option and to
    deliver all or a part of the sales proceeds to Corporation in payment of all
    or a part of the option price and  withholding  taxes due, or (ii) to pledge
    Shares  subject to the Option to the  broker as  security  for a loan and to
    deliver all or a part of the loan proceeds to  Corporation in payment of all
    or a part of the option price and withholding taxes due.

         7.7 SPECIAL RULES FOR INCENTIVE STOCK OPTIONS. In the case of an Option
    designated  as an Incentive  Stock  Option,  the terms of the Option and the
    Award  Agreement  shall be in conformance  with the statutory and regulatory
    requirements  specified in Section 422 of the Code, as in effect on the date
    such ISO is granted.  ISOs may not be granted under the Plan after


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December 9, 2006,  unless the ten-year  limitation  of Section  422(b)(2) of the
Code is removed or extended.

                                   ARTICLE 8
                           STOCK APPRECIATION RIGHTS

         8.1 GENERAL. Stock Appreciation Rights will be subject to the terms and
conditions set forth in Article 6 of the Plan and this Article 8 and may contain
such additional terms and conditions, not inconsistent with the express terms of
the Plan,  as the Board  deems  desirable,  subject to  approval,  to the extent
required,  by any regulatory  authority having  jurisdiction over Awards granted
under the Plan.

         8.2 NATURE OF STOCK APPRECIATION  RIGHT. A Stock Appreciation Right (or
SAR) is an Award  entitling  a  Participant  to receive  an amount  equal to the
excess  (or if the  Board  determines  at the time of grant,  a  portion  of the
excess) of the Fair  Market  Value of a Share on the date of exercise of the SAR
over  the  base  price,  as  described  below,  on the date of grant of the SAR,
multiplied  by the number of Shares with respect to which the SAR is  exercised.
The base price will be  designated  by the Board in the Award  Agreement for the
SAR and may be the Fair Market  Value of a Share on the grant date of the SAR or
such other higher or lower price as the Board determines.

         8.3 EXERCISE.   A  Stock  Appreciation  Right  may  be  exercised  by a
Participant in accordance  with procedures  established by the Board.  The Board
may also  provide  that a SAR  will be  automatically  exercised  on one or more
specified dates or upon the satisfaction of one or more specified conditions.

         8.4 FORM OF PAYMENT.  Payment  upon  exercise  of a Stock  Appreciation
Right may be made in cash, in installments,  in Shares,  or in any other form or
combination of such methods as the Board shall determine.

                                   ARTICLE 9
                                RESTRICTED UNITS

         9.1 NATURE OF RESTRICTED  UNITS. A Restricted Unit is an Award of stock
units  (with each unit  having a value  equivalent  to one  Share)  granted to a
Participant subject to such terms and conditions as the Board deems appropriate,
and may include a requirement that the Participant forfeit such Restricted Units
upon  termination  of  Participant's  employment  (or service as a Consultant or
Nonemployee Director) for specified reasons within a specified period of time or
upon other  conditions,  as set forth in the Award Agreement for such Restricted
Units.

         9.2 GENERAL.  Restricted  Units  will  be  subject  to the  terms  and
conditions  of  Article 6 of the Plan and this  Article 9 and may  contain  such
additional terms and conditions, not inconsistent with the express provisions of
the Plan,  as the Board  deems  desirable,  subject to  approval,  to the extent
required,  by any regulatory  authority having  jurisdiction over Awards granted
under the Plan.

         9.3 RESTRICTION PERIOD. Restricted Units will provide that such Awards,
and the Shares subject to such Awards,  may not be transferred,  and may provide
that, in order for a

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Participant  to  Vest  in  such  Awards,  the  Participant  must  remain  in the
employment (or remain as a Consultant or Nonemployee Director) of Corporation or
its  Subsidiaries,  subject  to  relief  for  reasons  specified  in  the  Award
Agreement,  for a period commencing on the date of grant of the Award and ending
on such later date or dates as the Board may  designate at the time of the Award
(the "Restriction Period"). During the Restriction Period, a Participant may not
sell,  assign,  transfer,  pledge,  encumber,  or  otherwise  dispose  of Shares
underlying Restricted Units. The Board, in its sole discretion,  may provide for
the lapse of restrictions in installments  during the Restriction  Period.  Upon
expiration of the applicable Restriction Period (or lapse of Restrictions during
the  Restriction  Period  where  the  Restrictions  lapse in  installments)  the
Participant  will be entitled to settlement of the  Restricted  Units or portion
thereof,  as the case may be. Although  Restricted Units usually will Vest based
on continued  employment  (or continued  service as a Consultant or  Nonemployee
Director) and Performance  Awards under Article 10 of the Plan will usually Vest
based on attainment of Performance  Goals,  the Board,  in its  discretion,  may
condition Vesting of Restricted Units on attainment of Performance Goals as well
as continued  employment  (or continued  service as a Consultant or  Nonemployee
Director).  In such case, the Restriction  Period for such Restricted Units will
include the period prior to satisfaction of the Performance Goals.

         9.4 FORFEITURE.  If  a  Participant  ceases  to  be  an  employee  (or
Consultant or Nonemployee  Director) of  Corporation or a Subsidiary  during the
Restriction  Period for any reason other than reasons  which may be specified in
an  Award  Agreement  (such as  death,  Disability,  or  Retirement)  the  Award
Agreement may require that all non-Vested Restricted Units previously granted to
the Participant be forfeited and returned to Corporation.

         9.5 SETTLEMENT OF VESTED RESTRICTED UNITS. Upon Vesting of an Award (or
portion thereof) of Restricted  Units, a Participant will be entitled to receive
payment for  Restricted  Units in an amount equal to the  aggregate  Fair Market
Value of the number of Shares covered by such Restricted Units at the expiration
of the applicable Restriction Period. Payment in settlement of a Restricted Unit
will be made as soon as  practicable  following the conclusion of the applicable
Restriction  Period in cash, in  installments,  in Shares equal to the number of
Restricted  Units,  or in any other form or  combination  of such methods as the
Board, in its sole discretion, determines.

                                   ARTICLE 10
                               PERFORMANCE AWARDS

         10.1 GENERAL.   Performance  Awards  will be  subject  to the terms and
conditions  set  forth in  Article  6 of the Plan  and this  Article  10 and may
contain  such other  terms and  conditions  not  inconsistent  with the  express
provisions of the Plan, as the Board deems  desirable,  subject to approval,  to
the extent required, by any regulatory authority having jurisdiction over Awards
granted under the Plan.

         10.2 NATURE OF PERFORMANCE  AWARDS. A Performance  Award is an Award of
stock units (with each unit having a value equivalent to one Share) granted to a
Participant subject to such terms and conditions as the Board deems appropriate,
including, without limitation, the requirement that the Participant forfeit such
Performance Award or a portion of

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<PAGE>

such  Award  in the  event  specified  Performance  Goals  are not met  within a
designated Performance Cycle.

         10.3 PERFORMANCE  CYCLES.  For each  Performance  Award, the Board will
designate a performance  period (the "Performance  Cycle") with a duration to be
determined by the Board in its  discretion  within which  specified  Performance
Goals are to be attained.  There may be several  Performance Cycles in existence
at any one time and the duration of Performance  Cycles for specific  Awards may
differ from each other.

         10.4 PERFORMANCE  GOALS.   For each  Performance  Award, the Board will
establish Performance Goals on the basis of such criteria and to accomplish such
objectives as the Board may from time to time select.  Performance  Goals may be
based on performance  criteria for  Corporation,  a Subsidiary,  or an operating
group  or  division,  or  based  on  a  Participant's   individual  performance.
Performance  Goals may include  objective and  subjective  criteria.  During any
Performance  Cycle,  the  Board  may  adjust  the  Performance  Goals  for  such
Performance   Cycle  as  it  deems   equitable  in  recognition  of  unusual  or
nonrecurring  events  affecting  Corporation,  changes in applicable tax laws or
accounting principles, or such other factors as the Board may determine.

         10.5 DETERMINATION OF VESTED AWARDS.   As soon as practicable after the
end of a  Performance  Cycle,  the  Board  will  determine  the  extent to which
Performance  Awards have been earned on the basis of  performance in relation to
the established Performance Goals.

         10.6 TIMING  AND FORM OF  PAYMENT.  Settlement  of earned  Performance
Awards  will be made  to the  Participant  as  soon  as  practicable  after  the
expiration of the Performance Cycle and the Board's  determination under Section
10.5,  in  the  form  of  cash,  installments,  or  Shares,  or in any  form  or
combination of such methods as the Board determines.

                                   ARTICLE 11
                    OTHER STOCK-BASED AND COMBINATION AWARDS

         11.1 OTHER STOCK-BASED  AWARDS.  The Board may grant other Awards under
the Plan  pursuant  to which  Shares  are or may in the future be  acquired,  or
Awards  denominated in or measured by Share equivalent  units,  including Awards
valued  using  measures  other  than the  market  value of  Shares.  Such  Other
Stock-Based  Awards may be granted  either  alone,  in addition to, or in tandem
with, any other type of Award granted under the Plan.

         11.2 COMBINATION AWARDS. The Board may also grant Awards under the Plan
in tandem or  combination  with other  Awards or in  exchange  of Awards,  or in
tandem or combination  with, or as  alternatives  to, grants or rights under any
other employee plan of Corporation,  including the plan of any acquired  entity.
No action  authorized  by this  section  will reduce the amount of any  existing
benefits or change the terms and conditions  thereof  without the  Participant's
consent.

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<PAGE>

                                   ARTICLE 12
                               DEFERRAL ELECTIONS

         The Board may  permit a  Participant  to elect to defer  receipt of the
payment of cash or the  delivery of Shares that would  otherwise  be due to such
Participant  by virtue of the  exercise,  earn-out,  or Vesting of an Award made
under the Plan.  If any such  election is  permitted,  the Board will  establish
rules and procedures for such payment deferrals,  including, but not limited to,
payment or crediting of a growth  factor on such  deferred  amounts  credited in
cash.

                                   ARTICLE 13
                ADJUSTMENTS UPON CHANGES IN CAPITALIZATION, ETC.

         13.1 PLAN DOES NOT RESTRICT CORPORATION.  The existence of the Plan and
the Awards  granted  under the Plan will not affect or  restrict  in any way the
right or  power  of the  Board or the  shareholders  of  Corporation  to make or
authorize any adjustment,  recapitalization,  reorganization, or other change in
Corporation's capital structure or its business,  any merger or consolidation of
the Corporation,  any issue of bonds, debentures,  preferred or prior preference
stocks ahead of or affecting  Corporation's capital stock or the rights thereof,
the  dissolution or liquidation of Corporation or any sale or transfer of all or
any part of its assets or business, or any other corporate act or proceeding.

         13.2  ADJUSTMENTS  BY  THE  BOARD.  In  the  event  of  any  change  in
capitalization  affecting the Shares of  Corporation,  such as a stock dividend,
stock split, recapitalization,  merger, consolidation,  split-up, combination or
exchange  of  shares  or  other  form of  reorganization,  or any  other  change
affecting the Shares,  such proportionate  adjustments as the Board, in its sole
discretion,  deems appropriate to reflect such change, will be made with respect
to the  aggregate  number of Shares for which  Awards in respect  thereof may be
granted  under  the Plan,  the  maximum  number  of Shares  which may be sold or
awarded to any  Participant,  the number of Shares  covered by each  outstanding
Award, and the price per Share in respect of outstanding  Awards.  The Board may
also make such  adjustments  in the  number of Shares  covered  by, and price or
other  value of any  outstanding  Awards  in the  event of a  spin-off  or other
distribution  (other than  normal  cash  dividends),  of  Corporation  assets to
shareholders.

                                   ARTICLE 14
                           AMENDMENT AND TERMINATION

         Without further approval of Corporation's  shareholders,  the Board may
at any time  terminate  the  Plan,  or may  amend  it from  time to time in such
respects  as the  Board  may deem  advisable;  provided  that the Board may not,
without approval of the  shareholders,  make any amendment that would materially
increase  the  aggregate  number  of Shares  that may be  issued  under the Plan
(except  for  adjustments  pursuant  to Article 13 of the  Plan);  and  provided
further  that any  amendment  of the Plan shall be subject to  approval,  to the
extent required, by any regulatory authority having jurisdiction over the Plan.

                                     - 13 -
<PAGE>

                                   ARTICLE 15
                                 MISCELLANEOUS

         15.1    Tax Withholding.

         15.1.1  GENERAL.  Corporation  will have the  right to deduct  from any
settlement  of any Award under the Plan,  including  the  delivery or vesting of
Shares,  any  taxes of any kind  required  by the laws of any  Canadian  or U.S.
jurisdiction  to be withheld with respect to such payments or to take such other
action  as may be  necessary  in the  opinion  of  Corporation  to  satisfy  all
obligations  for the  payment of such  taxes.  The  recipient  of any payment or
distribution under the Plan may be required to make arrangements satisfactory to
Corporation  for the  satisfaction  of any  such  withholding  tax  obligations,
whether or not such  recipient is an employee of  Corporation or a Subsidiary on
the date of such  settlement.  Corporation will not be required to make any such
payment or distribution under the Plan until such obligations are satisfied.

         15.1.2  STOCK  WITHHOLDING.  The  Board,  in its sole  discretion,  may
permit a Participant to satisfy all or a part of the withholding tax obligations
incident to the settlement of an Award  involving  payment or delivery of Shares
to the Participant by having  Corporation  withhold a portion of the Shares that
would otherwise be issuable to the Participant. Such Shares will be valued based
on their Fair  Market  Value on the date the tax  withholding  is required to be
made.

         15.2    UNFUNDED PLAN. The Plan will be unfunded and Corporation  shall
not be required to segregate any assets that may at any time be  represented  by
Awards under the Plan.  Any liability of  Corporation to any person with respect
to any  Award  under  the  Plan  will  be  based  solely  upon  any  contractual
obligations  that may be effected  pursuant to the Plan.  No such  obligation of
Corporation shall be deemed to be secured by any pledge of, or other encumbrance
on, any property of Corporation.

         15.3    PAYMENTS TO TRUST.  The  Board  is  authorized  to  cause to be
established a trust agreement or several trust  agreements  whereunder the Board
may make payments of amounts due or to become due to  Participants  in the Plan.
However, the Board has no obligation to establish such a trust or fund.

         15.4    ANNULMENT OF AWARDS.  Any Award  Agreement may provide that the
grant  of an  Award  payable  in  cash  is  provisional  until  cash  is paid in
settlement  of such  Award or that the  grant of an Award  payable  in Shares is
provisional  until the Participant  becomes entitled to the stock certificate in
settlement  of  such  Award.  In the  event  the  employment  (or  service  as a
Consultant or Nonemployee Director) of a Participant is terminated for cause (as
defined below), any Award that is provisional will be annulled as of the date of
such  termination for cause. For the purpose of this Section 15.4, the term "for
cause"  will  have  the  meaning  set  forth  in  the  Participant's  employment
agreement, if any, or otherwise means any discharge (or removal) for material or
flagrant  violation of the policies and  procedures of  Corporation or for other
job performance or conduct that is materially  detrimental to the best interests
of Corporation, as determined by the Board.

                                     - 14 -
<PAGE>

         15.5    ENGAGING IN COMPETITION WITH  CORPORATION.  Any Award Agreement
may provide that, if a Participant  terminates  employment with Corporation or a
Subsidiary  for any reason  whatsoever,  and within 18 months  after the date of
such termination accepts employment with any competitor of (or otherwise engages
in competition with) Corporation, the Board, in its sole discretion, may require
such  Participant to return to Corporation  the economic value of any Award that
is realized or obtained (measured at the date of exercise,  Vesting, or payment)
by such  Participant at any time during the period beginning on the date that is
six months prior to the date of such  Participant's  termination  of  employment
with Corporation.

         15.6    OTHER CORPORATION BENEFIT AND COMPENSATION  PROGRAMS.  Payments
and other benefits received by a Participant under an Award made pursuant to the
Plan  will  not  be  deemed  a  part  of  a  Participant's  regular,   recurring
compensation  for purposes of the termination  indemnity or severance pay law of
any state or  country  and will not be  included  in, or have any effect on, the
determination  of  benefits  under any other  employee  benefit  plan or similar
arrangement provided by Corporation or a Subsidiary unless expressly so provided
by such  other  plan or  arrangements,  or  except  where  the  Board  expressly
determines that an Award or portion of an Award should be included to accurately
reflect  competitive  compensation  practices or to recognize  that an Award has
been made in lieu of a portion of cash  compensation.  Awards under the Plan may
be made in combination  with or in tandem with, or as  alternatives  to, grants,
awards,   or  payments  under  any  other   Corporation  or  Subsidiary   plans,
arrangements,  or  programs.  The  Plan  notwithstanding,   Corporation  or  any
Subsidiary   may  adopt  such  other   compensation   programs  and   additional
compensation  arrangements as it deems necessary to attract,  retain, and reward
employees and directors for their service with Corporation and its Subsidiaries.

         15.7    SECURITIES LAW RESTRICTIONS. No Shares will be issued under the
Plan unless  counsel for  Corporation is satisfied that such issuance will be in
compliance  with  the  applicable  securities  laws  of  any  Canadian  or  U.S.
jurisdiction. Certificates for Shares delivered under the Plan may be subject to
such  stop-transfer  orders and other  restrictions as the Board deems advisable
under the rules,  regulations,  and other  requirements  of the  Securities  and
Exchange Commission, the Alberta or British Columbia Securities Commissions, any
stock  exchange  upon  which the  Shares  are then  listed,  and any  applicable
securities  law.  The Board may cause a legend or  legends to be put on any such
certificates to make appropriate reference to such restrictions.

         15.8    GOVERNING LAW. Except with respect to references to the Code or
applicable  securities  laws, the Plan and all actions taken  thereunder will be
governed by and construed in accordance with the laws of the State of Oregon.

                                   ARTICLE 16
                              SHAREHOLDER APPROVAL

         The adoption of the Plan, as amended and restated effective October 15,
1997,  and any  grant of  Awards  under the Plan are  expressly  subject  to the
approval  of the  Plan  by  the  shareholders  at the  1997  annual  meeting  of
Corporation's  shareholders.  In the event  that such  shareholder  approval  is
received, no additional stock options will be granted thereafter under the

                                     - 15 -
<PAGE>


Stock Option Plan and such plan will immediately  terminate;  provided that such
termination will have no effect on any options previously granted thereunder.