SEQUENT COMPUTER SYSTEMS, INC.
                        1995 STOCK INCENTIVE PLAN

     1.  Purpose.  The purpose of this Stock Incentive Plan (the 
"Plan") is to enable Sequent Computer Systems, Inc. (the "Company") to 
attract and retain the services of (1) selected employees, officers and 
directors of the Company or of any subsidiary of the Company and 
(2) selected non-employee agents, consultants, advisors, persons involved 
in the sale or distribution of the Company's products and independent 
contractors of the Company or any subsidiary.

     2.  Shares Subject to the Plan.  Subject to adjustment as 
provided below and in paragraph 14, the shares to be offered under the Plan 
shall consist of Common Stock of the Company, and the total number of 
shares of Common Stock that may be issued under the Plan shall not exceed 
1,200,000 shares plus any shares that are available for grant under the 
Company's 1989 Incentive Plan or that may subsequently become available for 
grant under such plan or the 1987 Nonstatutory Stock Option Plan or the 
1987 Employee Stock Option through the expiration, termination, forfeiture 
or cancellation of awards under such plans.  The shares issued under the 
Plan may be authorized and unissued shares or reacquired shares.  If an 
option, stock appreciation right or performance unit granted under the Plan 
expires, terminates or is cancelled, the unissued shares subject to such 
option, stock appreciation right or performance unit shall again be 
available under the Plan.  If shares sold or awarded as a bonus under the 
Plan are forfeited to the Company or repurchased by the Company, the number 
of shares forfeited or repurchased shall again be available under the Plan. 

     3.  Effective Date and Duration of Plan.

         (a) Effective Date.  The Plan shall become effective as of 
January 26, 1995 (the "Effective Date").  No option, stock appreciation 
right or performance unit granted under the Plan to an officer who is 
subject to Section 16(b) of the Securities Exchange Act of 1934, as amended 
(the "Exchange Act") or a director shall become exercisable, however, until 
the Plan is approved by shareholders in accordance with Rule 16b-3 as in 
effect at the time of the Company's 1995 annual meeting of shareholders and 
any such awards under the Plan prior to such approval shall be conditioned 
on and subject to such approval.  Subject to this limitation, options, 
stock appreciation rights and performance units may be granted and shares 
may be awarded as bonuses or sold under the Plan at any time after the 
effective date and before termination of the Plan.
            
         (b) Duration.  The Plan shall continue in effect until all 
shares available for issuance under the Plan have been issued and all 
restrictions on such shares have lapsed.  The Board of Directors may 
suspend or terminate the Plan at any time except with respect to options, 
performance units and shares subject to restrictions then outstanding under 
the Plan.  Termination shall not affect any outstanding options, any right 
of the Company to repurchase shares or the forfeitability of shares issued 
under the Plan.

     4.  Administration.

         (a) Board of Directors.  The Plan shall be administered by 
the Board of Directors of the Company, which shall determine and designate 
from time to time the individuals to whom awards shall be made, the amount 
of the awards and the other terms and conditions of the awards.  Subject to 
the provisions of the Plan, the Board of Directors may from time to time 
adopt and amend rules and regulations relating to administration of the 
Plan, advance the lapse of any waiting period, accelerate any exercise 
date, waive or modify any restriction applicable to shares (except those 
restrictions imposed by law) and make all other determinations in the 
judgment of the Board of Directors necessary or desirable for the 
administration of the Plan.  The interpretation and construction of the 
provisions of the Plan and related agreements by the Board of Directors 
shall be final and conclusive.  The Board of Directors may correct any 
defect or supply any omission or reconcile any inconsistency in the Plan or 
in any related agreement in the manner and to the extent it shall deem 
expedient to carry the Plan into effect, and it shall be the sole and final 
judge of such expediency.

         (b)  Committee.  The Board of Directors may delegate to a 
committee of the Board of Directors or specified officers of the Company, 
or both (the "Committee") any or all authority for administration of the 
Plan.  If authority is delegated to a Committee, all references to the 
Board of Directors in the Plan shall mean and relate to the Committee 
except (i) as otherwise provided by the Board of Directors, (ii) that only 
the Board of Directors may amend or terminate the Plan as provided in 
paragraphs 3 and 17 and (iii) that a Committee including officers of the 
Company shall not be permitted to grant options to persons who are officers 
of the Company.

     5.  Types of Awards; Eligibility; Limitations on Certain Awards. 
The Board of Directors may, from time to time, take the following action, 
separately or in combination, under the Plan:  (i) grant Incentive Stock 
Options, as defined in Section 422 of the Internal Revenue Code of 1986, as 
amended (the "Code"), as provided in paragraphs 6(a) and 6(b); (ii) grant 
options other than Incentive Stock Options ("Non-Statutory Stock Options") 
as provided in paragraphs 6(a) and 6(c); (iii) award stock bonuses as 
provided in paragraph 7; (iv) sell shares subject to restrictions as 
provided in paragraph 8; (v) grant stock appreciation rights as provided in 
paragraph 9; (vi) grant cash bonus rights as provided in paragraph 10; 
(vii) grant performance units as provided in paragraph 11 and (viii) grant 
foreign qualified awards as provided in paragraph 12.  Any such awards may 
be made to employees, including employees who are officers or directors, 
and to other individuals described in paragraph 1 who the Board of 
Directors believes have made or will make an important contribution to the 
Company or its subsidiaries; provided, however, that only employees of the 
Company shall be eligible to receive Incentive Stock Options under the Plan 
and directors who are not employees shall receive awards only pursuant to 
paragraph 13.  The Board of Directors shall select the individuals to whom 
awards shall be made and shall specify the action taken with respect to 
each individual to whom an award is made.  At the discretion of the Board 
of Directors, an individual may be given an election to surrender an award 
in exchange for the grant of a new award.  No employee may be granted 
options or stock appreciation rights under the Plan for more than an 
aggregate of 500,000 shares of Common Stock in any calendar year.       

     6.  Option Grants.

         (a) General Rules Relating to Options.

             (i) Terms of Grant.  The Board of Directors may 
     grant options under the Plan.  With respect to each option grant, 
     the Board of Directors shall determine the number of shares subject to 
     the option, the option price, the period of the option, the time or 
     times at which the option may be exercised and whether the option is an 
     Incentive Stock Option or a Non-Statutory Stock Option.  At the time of 
     the grant of an option or at any time thereafter, the Board of Directors 
     may provide that an optionee who exercised an option with Common Stock 
     of the Company shall automatically receive a new option to purchase 
     additional shares equal to the number of shares surrendered and 
     may specify the terms and conditions of such new options.

             (ii) Exercise of Options.  Except as provided in 
     paragraph 6(a)(iv) or as determined by the Board of Directors, no 
     option granted under the Plan may be exercised unless at the time 
     of such exercise the optionee is employed by or in the service of 
     the Company or any subsidiary of the Company and shall have been 
     so employed or provided such service continuously since the date 
     such option was granted.  Absence on leave or on account of 
     illness or disability under rules established by the Board of 
     Directors shall not, however, be deemed an interruption of 
     employment or service for this purpose.  Unless otherwise 
     determined by the Board of Directors, vesting of options shall not 
     continue during an absence on leave (including an extended 
     illness) or on account of disability.  Except as provided in 
     paragraphs 6(a)(iv), 14 and 15, options granted under the Plan may 
     be exercised from time to time over the period stated in each 
     option in such amounts and at such times as shall be prescribed by 
     the Board of Directors, provided that options shall not be 
     exercised for fractional shares.  Unless otherwise determined by 
     the Board of Directors, if the optionee does not exercise an 
     option in any one year with respect to the full number of shares 
     to which the optionee is entitled in that year, the optionee's 
     rights shall be cumulative and the optionee may purchase those 
     shares in any subsequent year during the term of the option.

             (iii) Nontransferability.  Each Incentive Stock 
     Option and, unless otherwise determined by the Board of Directors 
     with respect to an option granted to a person who is neither an 
     officer nor a director of the Company, each other option granted 
     under the Plan by its terms shall be nonassignable and 
     nontransferable by the optionee, either voluntarily or by 
     operation of law, except by will or by the laws of descent and 
     distribution of the state or country of the optionees domicile at 
     the time of death, and each option by its terms shall be 
     exercisable during the optionees lifetime only by the optionee.

             (iv) Termination of Employment or Service.

                  (A) General Rule.  Unless otherwise determined 
             by the Board of Directors, in the event the employment or 
             service of the optionee with the Company or a subsidiary 
             terminates for any reason other than because of physical 
             disability or death as provided in subparagraphs 6(a)(iv)(B) 
             and (C), the option may be exercised at any time prior to the 
             expiration date of the option or the expiration of 30 days 
             after the date of such termination, whichever is the shorter 
             period, but only if and to the extent the optionee was 
             entitled to exercise the option at the date of such 
             termination.

                  (B) Termination Because of Total Disability.  
             Unless otherwise determined by the Board of Directors, in the 
             event of the termination of employment or service because of 
             total disability, the option may be exercised at any time 
             prior to the expiration date of the option or the expiration 
             of 12 months after the date of such termination, whichever is 
             the shorter period, but only if and to the extent the optionee 
             was entitled to exercise the option at the date of such 
             termination.  The term "total disability" means a mental or 
             physical impairment which is expected to result in death or 
             which has lasted or is expected to last for a continuous 
             period of 12 months or more and which causes the optionee to 
             be unable, in the opinion of the Company and two independent 
             physicians, to perform his or her duties as an employee, 
             director, officer or consultant of the Company and to be 
             engaged in any substantial gainful activity.  Total disability 
             shall be deemed to have occurred on the first day after the 
             Company and the two independent physicians have furnished 
             their opinion of total disability to the Company.

                  (C) Termination Because of Death.  Unless 
             otherwise determined by the Board of Directors, in the event 
             of the death of an optionee while employed by or providing 
             service to the Company or a subsidiary, the option may be 
             exercised at any time prior to the expiration date of the 
             option or the expiration of 12 months after the date of such 
             death, whichever is the shorter period, but only if and to the 
             extent the optionee was entitled to exercise the option at the 
             date of such termination and only by the person or persons to 
             whom such optionees rights under the option shall pass by the 
             optionee's will or by the laws of descent and distribution of 
             the state or country of domicile at the time of death.

                  (D) Amendment of Exercise Period Applicable to 
             Termination.  The Board of Directors, at the time of grant or 
             at any time thereafter, may extend the 30-day and 12-month 
             exercise periods any length of time not later than the 
             original expiration date of the option, and may increase the 
             portion of an option that is exercisable, subject to such 
             terms and conditions as the Board of Directors may determine.

                  (E) Failure to Exercise Option.  To the extent 
             that the option of any deceased optionee or of any optionee 
             whose employment or service terminates is not exercised within 
             the applicable period, all further rights to purchase shares 
             pursuant to such option shall cease and terminate.

             (v) Purchase of Shares.  Unless the Board of 
     Directors determines otherwise, shares may be acquired pursuant to 
     an option granted under the Plan only upon receipt by the Company 
     of notice in writing from the optionee of the optionee's intention 
     to exercise, specifying the number of shares as to which the 
     optionee desires to exercise the option and the date on which the 
     optionee desires to complete the transaction, and if required in 
     order to comply with the Securities Act of 1933, as amended, 
     containing a representation that it is the optionee's present 
     intention to acquire the shares for investment and not with a view 
     to distribution.  Unless the Board of Directors determines 
     otherwise, on or before the date specified for completion of the 
     purchase of shares pursuant to an option, the optionee must have 
     paid the Company the full purchase price of such shares in cash 
     (including, with the consent of the Board of Directors, cash that 
     may be the proceeds of a loan from the Company) or, with the 
     consent of the Board of Directors, in whole or in part, in Common 
     Stock of the Company valued at fair market value, restricted 
     stock, performance units or other contingent awards denominated in 
     either stock or cash, deferred compensation credits, promissory 
     notes and other forms of consideration.  The fair market value of 
     Common Stock provided in payment of the purchase price shall be 
     the closing price of the Common Stock as reported in The Wall 
     Street Journal on the trading day preceding the date the option is 
     exercised, or such other reported value of the Common Stock as 
     shall be specified by the Board of Directors.  No shares shall be 
     issued until full payment therefor has been made.  With the 
     consent of the Board of Directors, an optionee may request the 
     Company to apply automatically the shares to be received upon the 
     exercise of a portion of a stock option (even though stock 
     certificates have not yet been issued) to satisfy the purchase 
     price for additional portions of the option.  Each optionee who 
     has exercised an option shall immediately upon notification of the 
     amount due, if any, pay to the Company in cash amounts necessary 
     to satisfy any applicable federal, state and local tax withholding 
     requirements.  If additional withholding is or becomes required 
     beyond any amount deposited before delivery of the certificates, 
     the optionee shall pay such amount to the Company on demand.  If 
     the optionee fails to pay the amount demanded, the Company may 
     withhold that amount from other amounts payable by the Company to 
     the optionee, including salary, subject to applicable law.  With 
     the consent of the Board of Directors an optionee may satisfy this 
     obligation, in whole or in part, by having the Company withhold 
     from the shares to be issued upon the exercise that number of 
     shares that would satisfy the withholding amount due or by 
     delivering to the Company Common Stock to satisfy the withholding 
     amount.  Upon the exercise of an option, the number of shares 
     reserved for issuance under the Plan shall be reduced by the 
     number of shares issued upon exercise of the option, less the 
     number of shares surrendered in payment of the option exercise or 
     surrendered or withheld to satisfy withholding obligations.

         (b) Incentive Stock Options.  Incentive Stock Options 
shall be subject to the following additional terms and conditions:

             (i) Limitation on Amount of Grants.  No employee may 
         be granted Incentive Stock Options under the Plan if the aggregate 
         fair market value, on the date of grant, of the Common Stock with 
         respect to which Incentive Stock Options are exercisable for the 
         first time by that employee during any calendar year under the 
         Plan and under any other incentive stock option plan (within the 
         meaning of Section 422 of the Code) of the Company or any parent 
         or subsidiary of the Company exceeds $100,000.

             (ii) Limitations on Grants to 10 Percent 
         Shareholders.  An Incentive Stock Option may be granted under the 
         Plan to an employee possessing more than 10 percent of the total 
         combined voting power of all classes of stock of the Company or of 
         any parent or subsidiary of the Company only if the option price 
         is at least 110 percent of the fair market value of the Common 
         Stock subject to the option on the date it is granted, as 
         described in paragraph 6(b)(iv), and the option by its terms is 
         not exercisable after the expiration of five years from the date 
         it is granted.

             (iii) Duration of Options.  Subject to paragraphs 
         6(a)(ii) and 6(b)(ii), Incentive Stock Options granted under the 
         Plan shall continue in effect for the period fixed by the Board of 
         Directors, except that no Incentive Stock Option shall be 
         exercisable after the expiration of 10 years from the date it is 
         granted.

             (iv) Option Price.  The option price per share shall 
         be determined by the Board of Directors at the time of grant.  
         Except as provided in paragraph 6(b)(ii), the option price shall 
         not be less than 100 percent of the fair market value of the 
         Common Stock covered by the Incentive Stock Option at the date the 
         option is granted.  The fair market value shall be deemed to be 
         the closing price of the Common Stock as reported in The Wall 
         Street Journal on the day preceding the date the option is 
         granted, or if there has been no sale on that date, on the last 
         preceding date on which a sale occurred, or such other value of 
         the Common Stock as shall be specified by the Board of Directors.
 
             (v) Limitation on Time of Grant.  No Incentive Stock 
         Option shall be granted on or after the tenth anniversary of the 
         effective date of the Plan.

             (vi) Conversion of Incentive Stock Options.  The 
         Board of Directors may at any time without the consent of the 
         optionee convert an Incentive Stock Option to a Non-Statutory 
         Stock Option.

             (vii) Limitation on Number of Shares Issuable Under 
         Incentive Stock Options.  Subject to adjustment as provided in 
         paragraph 14, the total number of shares of Common Stock that may 
         be issued under the Plan upon exercise of Incentive Stock Options 
         shall not exceed 1,200,000 shares.  

         (c) Non-Statutory Stock Options.  Non-Statutory Stock 
Options shall be subject to the following additional terms and conditions:

             (i) Option Price.  The option price for 
         Non-Statutory Stock Options shall be determined by the Board of 
         Directors at the time of grant.  The option price may not be less 
         than 50 percent of the fair market value of the shares on the date 
         of grant.  The fair market value of shares covered by a 
         Non-Statutory Stock Option shall be determined pursuant to 
         paragraph 6(b)(iv).

             (ii) Duration of Options.  Non-Statutory Stock 
         Options granted under the Plan shall continue in effect for the 
         period fixed by the Board of Directors.

     7.  Stock Bonuses.  The Board of Directors may award shares under 
the Plan as stock bonuses.  Shares awarded as a bonus shall be subject to 
the terms, conditions, and restrictions determined by the Board of 
Directors.  The restrictions may include restrictions concerning 
transferability and forfeiture of the shares awarded, together with such 
other restrictions as may be determined by the Board of Directors.  The 
Board of Directors may require the recipient to sign an agreement as a 
condition of the award, but may not require the recipient to pay any 
monetary consideration other than amounts necessary to satisfy tax 
withholding requirements.  The agreement may contain any terms, conditions, 
restrictions, representations and warranties required by the Board of 
Directors.  The certificates representing the shares awarded shall bear any 
legends required by the Board of Directors.  The Company may require any 
recipient of a stock bonus to pay to the Company in cash upon demand 
amounts necessary to satisfy any applicable federal, state or local tax 
withholding requirements.  If the recipient fails to pay the amount 
demanded, the Company may withhold that amount from other amounts payable 
by the Company to the recipient, including salary or fees for services, 
subject to applicable law.  With the consent of the Board of Directors, a 
recipient may deliver Common Stock to the Company to satisfy this 
withholding obligation.  Upon the issuance of a stock bonus, the number of 
shares reserved for issuance under the Plan shall be reduced by the number 
of shares issued, less the number of shares surrendered or withheld to 
satisfy withholding obligations.

     8.  Restricted Stock.  The Board of Directors may issue shares 
under the Plan for such consideration (including promissory notes and 
services) as determined by the Board of Directors provided that in no event 
shall the consideration be less than 50 percent of fair market value of the 
Common Stock at the time of issuance.  Shares issued under the Plan shall 
be subject to the terms, conditions and restrictions determined by the 
Board of Directors.  The restrictions may include restrictions concerning 
transferability, repurchase by the Company and forfeiture of the shares 
issued, together with such other restrictions as may be determined by the 
Board of Directors.  All Common Stock issued pursuant to this paragraph 8 
shall be subject to a purchase agreement, which shall be executed by the 
Company and the prospective recipient of the shares prior to the delivery 
of certificates representing such shares to the recipient.  The purchase 
agreement may contain any terms, conditions, restrictions, representations 
and warranties required by the Board of Directors.  The certificates 
representing the shares shall bear any legends required by the Board of 
Directors.  The Company may require any purchaser of restricted stock to 
pay to the Company in cash upon demand amounts necessary to satisfy any 
applicable federal, state or local tax withholding requirements.  If the 
purchaser fails to pay the amount demanded, the Company may withhold that 
amount from other amounts payable by the Company to the purchaser, 
including salary, subject to applicable law.  With the consent of the Board 
of Directors, a purchaser may deliver Common Stock to the Company to 
satisfy this withholding obligation.  Upon the issuance of restricted 
stock, the number of shares reserved for issuance under the Plan shall be 
reduced by the number of shares issued, less the number of shares 
surrendered in payment of the restricted stock or surrendered or withheld 
to satisfy withholding obligations.

     9.  Stock Appreciation Rights.

         (a) Grant.  Stock appreciation rights may be granted under 
the Plan by the Board of Directors, subject to such rules, terms, and 
conditions as the Board of Directors prescribes.

         (b) Exercise.

             (i) Each stock appreciation right shall entitle the 
         holder, upon exercise, to receive from the Company in exchange 
         therefor an amount equal in value to the excess of the fair market 
         value on the date of exercise of one share of Common Stock of the 
         Company over its fair market value on the date of grant (or, in 
         the case of a stock appreciation right granted in connection with 
         an option, the excess of the fair market value of one share of 
         Common Stock of the Company over the option price per share under 
         the option to which the stock appreciation right relates), 
         multiplied by the number of shares covered by the stock 
         appreciation right or the option, or portion thereof, that is 
         surrendered.  No stock appreciation right shall be exercisable at 
         a time that the amount determined under this subparagraph is 
         negative.  Payment by the Company upon exercise of a stock 
         appreciation right may be made in Common Stock valued at fair 
         market value, in cash, or partly in Common Stock and partly in 
         cash, all as determined by the Board of Directors.

             (ii) A stock appreciation right shall be exercisable 
         only at the time or times established by the Board of Directors.  
         If a stock appreciation right is granted in connection with an 
         option, the following rules shall apply:  (1) the stock 
         appreciation right shall be exercisable only to the extent and on 
         the same conditions that the related option could be exercised; 
         (2) upon exercise of the stock appreciation right, the option or 
         portion thereof to which the stock appreciation right relates 
         terminates; and (3) upon exercise of the option, the related stock 
         appreciation right or portion thereof terminates.  No stock 
         appreciation right granted to an officer or director may be 
         exercised during the first six months following the date it is 
         granted.

             (iii) The Board of Directors may withdraw any stock 
         appreciation right granted under the Plan at any time and may 
         impose any conditions upon the exercise of a stock appreciation 
         right or adopt rules and regulations from time to time affecting 
         the rights of holders of stock appreciation rights.  Such rules 
         and regulations may govern the right to exercise stock 
         appreciation rights granted prior to adoption or amendment of such 
         rules and regulations as well as stock appreciation rights granted 
         thereafter.

             (iv) For purposes of this paragraph 9, the fair 
         market value of the Common Stock shall be the closing price of the 
         Common Stock as reported in The Wall Street Journal, or such other 
         reported value of the Common Stock as shall be specified by the 
         Board of Directors, on the trading day preceding the date the 
         stock appreciation right is exercised.

             (v) No fractional shares shall be issued upon 
         exercise of a stock appreciation right.  In lieu thereof, cash may 
         be paid in an amount equal to the value of the fraction or, if the 
         Board of Directors shall determine, the number of shares may be 
         rounded downward to the next whole share.

             (vi) Each participant who has exercised a stock 
         appreciation right shall, upon notification of the amount due, pay 
         to the Company in cash amounts necessary to satisfy any applicable 
         federal, state and local tax withholding requirements.  If the 
         participant fails to pay the amount demanded, the Company may 
         withhold that amount from other amounts payable by the Company to 
         the participant including salary, subject to applicable law.  With 
         the consent of the Board of Directors a participant may satisfy 
         this obligation, in whole or in part, by having the Company 
         withhold from any shares to be issued upon the exercise that 
         number of shares that would satisfy the withholding amount due or 
         by delivering Common Stock to the Company to satisfy the 
         withholding amount.

             (vii) Upon the exercise of a stock appreciation 
         right for shares, the number of shares reserved for issuance under 
         the Plan shall be reduced by the number of shares issued, less the 
         number of shares surrendered or withheld to satisfy withholding 
         obligations.  Cash payments of stock appreciation rights shall not 
         reduce the number of shares of Common Stock reserved for issuance 
         under the Plan.

     10. Cash Bonus Rights.

         (a) Grant.  The Board of Directors may grant cash bonus 
rights under the Plan in connection with (i) options granted or previously 
granted, (ii) stock appreciation rights granted or previously granted, 
(iii) stock bonuses awarded or previously awarded and (iv) shares sold or 
previously sold under the Plan.  Cash bonus rights will be subject to 
rules, terms and conditions as the Board of Directors may prescribe.  The 
payment of a cash bonus shall not reduce the number of shares of Common 
Stock reserved for issuance under the Plan.

         (b) Cash Bonus Rights in Connection With Options.  A cash 
bonus right granted in connection with an option will entitle an optionee 
to a cash bonus when the related option is exercised (or terminates in 
connection with the exercise of a stock appreciation right related to the 
option) in whole or in part.  No cash bonus right granted to an officer or 
director in connection with an option may be exercised during the first six 
months following the date the bonus right is granted.  If an optionee 
purchases shares upon exercise of an option and does not exercise a related 
stock appreciation right, the amount of the bonus shall be determined by 
multiplying the excess of the total fair market value of the shares to be 
acquired upon the exercise over the total option price for the shares by 
the applicable bonus percentage.  If the optionee exercises a related stock 
appreciation right in connection with the termination of an option, the 
amount of the bonus shall be determined by multiplying the total fair 
market value of the shares and cash received pursuant to the exercise of 
the stock appreciation right by the applicable bonus percentage.  The bonus 
percentage applicable to a bonus right shall be determined from time to 
time by the Board of Directors but shall in no event exceed 75 percent.

         (c) Cash Bonus Rights in Connection With Stock Bonus.  A 
cash bonus right granted in connection with a stock bonus will entitle the 
recipient to a cash bonus payable when the stock bonus is awarded or 
restrictions, if any, to which the stock is subject lapse.  If bonus stock 
awarded is subject to restrictions and is repurchased by the Company or 
forfeited by the holder, the cash bonus right granted in connection with 
the stock bonus shall terminate and may not be exercised.  The amount and 
timing of payment of a cash bonus shall be determined by the Board of 
Directors.

         (d) Cash Bonus Rights in Connection With Stock Purchases. 
 A cash bonus right granted in connection with the purchase of stock 
pursuant to paragraph 8 will entitle the recipient to a cash bonus when the 
shares are purchased or restrictions, if any, to which the stock is subject 
lapse.  Any cash bonus right granted in connection with shares purchased 
pursuant to paragraph 8 shall terminate and may not be exercised in the 
event the shares are repurchased by the Company or forfeited by the holder 
pursuant to applicable restrictions.  The amount of any cash bonus to be 
awarded and timing of payment of a cash bonus shall be determined by the 
Board of Directors.

         (e) Taxes.  The Company shall withhold from any cash bonus 
paid pursuant to paragraph 10 the amount necessary to satisfy any 
applicable federal, state and local withholding requirements.

     11. Performance Units.  The Board of Directors may grant 
performance units consisting of monetary units which may be earned in whole 
or in part if the Company achieves certain goals established by the Board 
of Directors over a designated period of time, but not in any event more 
than 10 years.  The goals established by the Board of Directors may include 
earnings per share, return on shareholders' equity, return on invested 
capital, and such other goals as may be established by the Board of 
Directors.  In the event that the minimum performance goal established by 
the Board of Directors is not achieved at the conclusion of a period, no 
payment shall be made to the participants.  In the event the maximum 
corporate goal is achieved, 100 percent of the monetary value of the 
performance units shall be paid to or vested in the participants.  Partial 
achievement of the maximum goal may result in a payment or vesting 
corresponding to the degree of achievement as determined by the Board of 
Directors.  Payment of an award earned may be in cash or in Common Stock or 
in a combination of both, and may be made when earned, or vested and 
deferred, as the Board of Directors determines.  Deferred awards shall earn 
interest on the terms and at a rate determined by the Board of Directors.  
Each participant who has been awarded a performance unit shall, upon 
notification of the amount due, pay to the Company in cash amounts 
necessary to satisfy any applicable federal, state and local tax 
withholding requirements.  If the participant fails to pay the amount 
demanded, the Company may withhold that amount from other amounts payable 
by the Company to the participant, including salary or fees for services, 
subject to applicable law.  With the consent of the Board of Directors a 
participant may satisfy this obligation, in whole or in part, by having the 
Company withhold from any shares to be issued that number of shares that 
would satisfy the withholding amount due or by delivering Common Stock to 
the Company to satisfy the withholding amount.  The payment of a 
performance unit in cash shall not reduce the number of shares of Common 
Stock reserved for issuance under the Plan.  The number of shares reserved 
for issuance under the Plan shall be reduced by the number of shares issued 
upon payment of an award, less any shares surrendered or withheld to 
satisfy withholding obligations.

     12. Foreign Qualified Grants.  Awards under the Plan may be 
granted to such officers and employees of the Company and its subsidiaries 
and such other persons described in paragraph 1 residing in foreign 
jurisdictions as the Board of Directors may determine from time to time.  
The Board of Directors may adopt such supplements to the Plan as may be 
necessary to comply with the applicable laws of such foreign jurisdictions 
and to afford participants favorable treatment under such laws; provided, 
however, that no award shall be granted under any such supplement with 
terms which are more beneficial to the participants than the terms 
permitted by the Plan.

     13. Option Grants to Non-Employee Directors.

         (a) Initial Board Grants.  Each person who becomes a 
Non-Employee Director after the Effective Date shall be automatically 
granted an option to purchase 10,000 shares of Common Stock on the date he 
or she becomes a Non-Employee Director.  A "Non-Employee Director" is a 
director who is not an employee of the Company or any of its subsidiaries 
and has not been an employee of the Company or any of its subsidiaries 
within one year of any date as of which a determination of eligibility is 
made.

         (b) Additional Board Grants.  Each Non-Employee Director 
shall be automatically granted an option to purchase additional shares of 
Common Stock in each calendar year subsequent to the year in which such 
Non-Employee Director became a director, such option to be granted as of 
the date of the Company's annual meeting of stockholders held in such 
calendar year, provided that the Non-Employee Director continues to serve 
in such capacity as of such date.  The number of shares subject to each 
additional grant shall be 5,000 shares.

         (c) Committee Grants.  On the date of each annual meeting 
of shareholders, each Non-Employee Director who then serves on a committee 
of the Board of Directors shall be automatically granted an option to 
purchase 2,000 shares of Common Stock for each committee on which he or she 
then serves.

         (d) Exercise Price.  The exercise price of the options 
granted pursuant to this paragraph 13 shall be equal to 85 percent of the 
fair market value of the Common Stock determined pursuant to paragraph 
6(b)(iv).

         (e) Term of Option.  The term of each option granted 
pursuant to this paragraph 13 shall be 10 years from the date of grant.

         (f) Exercisability.  Until an option expires or is 
terminated and except as provided in paragraph 13(f), 14 and 15, an option 
granted under this paragraph 13 shall be exercisable according to the 
following schedule:

             Period of Non-Employee                         
             Director's Continuous                        
             Service as a Director of                   
             the Company from the Date              Portion of Total Option
             the Option is Granted                  Which Is Exercisable   

             Less than 12 months                    0%

             After 12 months                        24% plus 2% for each
                                                    complete month of
                                                    continuous service in
                                                    excess of 12 months,
                                                    until fully vested.

         For purposes of this paragraph 13(e), a complete month shall be 
deemed to be the period which starts on the day of grant and ends on the 
same day of the following calendar month, so that each successive "complete 
month" ends on the same day of each successive calendar month (or, in 
respect of any calendar month which does not include such a day, that 
"complete month" shall end on the first day of the next following calendar 
month).

         (g) Termination As a Director.  If an optionee ceases to 
be a director of the Company for any reason, including death, the option 
may be exercised at any time prior to the expiration date of the option or 
the expiration of 30 days (or 12 months in the event of death) after the 
last day the optionee served as a director, whichever is the shorter 
period, but only if and to the extent the optionee was entitled to exercise 
the option as of the last day the optionee served as a director.

         (h) Nontransferability.  Each option by its terms shall be 
nonassignable and nontransferable by the optionee, either voluntarily or by 
operation of law, except by will or by the laws of descent and distribution 
of the state or country of the optionee's domicile at the time of death, 
and each option by its terms shall be exercisable during the optionee's 
lifetime only by the optionee.

         (i) Exercise of Options.  Options may be exercised upon 
payment of cash or shares of Common Stock of the Company in accordance with 
paragraph 6(a)(v).

     14. Changes in Capital Structure.  If the outstanding Common 
Stock of the Company is hereafter increased or decreased or changed into or 
exchanged for a different number or kind of shares or other securities of 
the Company or of another corporation by reason of any reorganization, 
merger, consolidation, plan of exchange, recapitalization, 
reclassification, stock split-up, combination of shares or dividend payable 
in shares, appropriate adjustment shall be made by the Board of Directors 
in the number and kind of shares available for awards under the Plan.  In 
addition, except with respect to transactions referred to in paragraph 15, 
the Board of Directors shall make appropriate adjustment in the number and 
kind of shares as to which outstanding options and stock appreciation 
rights, or portions thereof then unexercised, shall be exercisable, so that 
the optionees proportionate interest before and after the occurrence of the 
event is maintained.  Notwithstanding the foregoing, the Board of Directors 
shall have no obligation to effect any adjustment that would or might 
result in the issuance of fractional shares, and any fractional shares 
resulting from any adjustment may be disregarded or provided for in any 
manner determined by the Board of Directors.  Any such adjustments made by 
the Board of Directors shall be conclusive.  If the stockholders of the 
Company receive capital stock of another corporation ("Exchange Stock") in 
exchange for their shares of Common Stock in any transaction involving a 
merger, consolidation or plan of exchange, all options granted hereunder 
shall be converted into options to purchase shares of Exchange Stock unless 
the Company and the corporation issuing the Exchange Stock, in their sole 
discretion, determine that any or all such options granted hereunder shall 
be converted into options to purchase shares of Exchange Stock but instead 
shall terminate in accordance with the provisions of the last sentence of 
this paragraph 14.  The amount and price of converted options shall be 
determined by adjusting the amount and price of the options granted 
hereunder in the same proportion as used for determining the number of 
shares of Exchange Stock the holders of the Common Stock receive in such 
merger.  The converted options shall be fully vested whether or not the 
vesting requirements set forth in the option agreement have been satisfied. 
 In the event of dissolution of the Company or a merger, consolidation or 
plan of exchange affecting the Company in lieu of providing for options and 
stock appreciation rights as provided above in this paragraph 14 the Board 
of Directors may, in its sole discretion, provide a 30-day period prior to 
such event during which optionees shall have the right to exercise options 
and stock appreciation rights in whole or in part without any limitation on 
exercisability and upon the expiration of which 30-day period all 
unexercised options and stock appreciation rights shall immediately 
terminate.

     15. Special Acceleration in Certain Events.

         (a) Special Acceleration.  Notwithstanding any other 
provisions of the Plan, a special acceleration ("Special Acceleration") of 
options and stock appreciation rights outstanding under the Plan shall 
occur with the effect set forth in paragraph 15(b) at any time when any one 
of the following events has taken place:

             (i) The shareholders of the Company approve one of 
     the following ("Approved Transactions"):

                 (A) Any consolidation, merger or plan of 
             exchange involving the Company ("Merger") pursuant to 
             which Common Stock would be converted into cash; or

                 (B) Any sale, lease, exchange, or other 
             transfer (in one transaction or a series of related 
             transactions) of all or substantially all of the assets 
             of the Company or the adoption of any plan or proposal 
             for the liquidation or dissolution of the Company; or

             (ii) A tender or exchange offer, other than one made 
     by the Company, is made for Common Stock (or securities 
     convertible into Common Stock) and such offer results in a 
     portion of those securities being purchased and the offeror 
     after the consummation of the offer is the beneficial owner (as 
     determined pursuant to Section 13(d) of the Exchange Act), 
     directly or indirectly, of at least 20 percent of the 
     outstanding Common Stock (an "Offer"); or

             (iii) The Company receives a report on Schedule 13D 
     of the Exchange Act reporting the beneficial ownership by any 
     person of 20 percent or more of the Company's outstanding 
     Common Stock, except that if such receipt shall occur during a 
     tender offer or exchange offer by any person other than the 
     Company or a wholly owned subsidiary of the Company, Special 
     Acceleration shall not take place until the conclusion of such 
     offer; or

             (iv) During any period of 12 months or less, 
     individuals who at the beginning of such a period constituted a 
     majority of the Board of Directors cease for any reason to 
     constitute a majority thereof unless the nomination or election 
     of such new directors was approved by a vote of at least two 
     thirds of the directors then still in office who were directors 
     at the beginning of such period.

     The terms used in this paragraph 15 and not defined elsewhere in the 
Plan shall have the same meanings as such terms have in the Exchange Act 
and the rules and regulations adopted thereunder.

     (b) Effect on Outstanding Options and Stock Appreciation 
Rights.  Upon a Special Acceleration pursuant to paragraph 15(a):

         (i) Exercise or Purchase of Options.  All options 
     then outstanding under the Plan shall immediately become 
     exercisable in full for the remainder of their terms, provided 
     that no option may be exercised by an officer or director of 
     the Company within six months of its date of grant; and each 
     optionee shall have the right during a period of 30 days 
     following a Special Acceleration to have the Company purchase 
     any Non-Statutory Stock Options as to which no stock 
     appreciation rights have been granted at a cash purchase price 
     computed in accordance with paragraph 15(b)(iii) below and any 
     Incentive Stock Options as to which no stock appreciation 
     rights have been granted at a cash purchase price equal to the 
     product of (1) the excess, if any, of the fair market value of 
     a share of Common Stock (computed in accordance with procedures 
     for granting Incentive Stock Options) over the option price and 
     (2) the number of shares of Common Stock covered by the 
     Incentive Stock Options or portion thereof surrendered, 
     provided that the Company shall have the right during such 
     period to purchase any Incentive Stock Option as to which no 
     stock appreciation rights have been granted at the purchase 
     price computed in accordance with paragraph 15(b)(iii) below.  
     With respect to an option (as to which no stock appreciation 
     rights have been granted) granted less than six months prior to 
     a Special Acceleration to an officer or director of the 
     Company, the officer or director shall have the right to have 
     the Company purchase such stock option in accordance with this 
     paragraph 14(b)(i) during the 30 days following the expiration 
     of six months after the date of such grant, and this right 
     shall apply even if the option has otherwise terminated 
     pursuant to paragraph 6(a)(iv) after a Special Acceleration.

         (ii) All stock appreciation rights outstanding 
     under the Plan shall immediately become exercisable in full for 
     a period of 30 days following a Special Acceleration, with 
     payment to be made solely in cash upon any exercise during such 
     period of a stock appreciation right granted with respect to a 
     Non-Statutory Stock Option in an amount computed in accordance 
     with paragraph 15(b)(iii) below, and in cash upon exercise 
     during such period of a stock appreciation right granted with 
     respect to an Incentive Stock Option in an amount equal to the 
     product of (1) the excess, if any, of the fair market value of 
     a Common Share (computed in accordance with procedures for 
     granting Incentive Stock Options) over the exercise price of 
     the related option and (2) the number of shares of Common Stock 
     covered by the related option.  Notwithstanding the foregoing, 
     the Company shall have the right during such period to purchase 
     any stock appreciation right granted with respect to an 
     Incentive Stock Option (and cancel the related options) at the 
     purchase price computed in accordance with paragraph 15(b)(iii) 
     below, and no stock appreciation right may be exercised by an 
     officer or director of the Company within six months of its 
     date of grant.  With respect to a stock appreciation right 
     granted less than six months prior to a Special Acceleration to 
     an officer or director of the Company, the stock appreciation 
     right shall become exercisable in full for a period of 30 days 
     following the expiration of six months after the date of such 
     grant, and this right shall apply even if the stock 
     appreciation right has otherwise terminated pursuant to 
     paragraph 6(a)(iv) after a Special Acceleration.

         (iii) Except as otherwise specified in paragraphs 
     15(b)(i) and 15(b)(ii) above, the purchase price for an option 
     or a stock appreciation right and the amount to be paid upon 
     exercise of a stock appreciation right shall be an amount equal 
     to the product of (1) the excess, if any, of the highest of 
     (A) the highest reported closing sales price of a share of 
     Common Stock as reported in The Wall Street Journal during the 
     60 days preceding such exercise, (B) the highest purchase price 
     shown in any Schedule 13D referred to in paragraphs 15(a)(ii) 
     or 15(a)(iii) as paid within the 60 days prior to the date of 
     such report, (C) the highest gross price (before brokerage 
     commissions and soliciting dealers' fees) paid or to be paid 
     for a share of Common Stock (whether by way of exchange, 
     conversion, distribution, or liquidation or otherwise) in any 
     Approved Transaction or Offer that is in effect at any time 
     during the 60 days preceding such exercise, over the option 
     price, and (2) the number of shares of Common Stock covered by 
     the stock option or stock appreciation right, or portions 
     thereof surrendered.  If the consideration paid or to be paid 
     in any Approved Transaction or offer consists, in whole or 
     part, of consideration other than cash, the Board of Directors 
     shall take action it deems appropriate to establish the cash 
     value of the consideration, but the valuation shall not be less 
     than the value, if any, attributed to the consideration by any 
     other party to the Approved Transaction or Offer.

         (iv) No options or stock appreciation rights may be 
     exercised upon a Special Acceleration if the amount determined 
     under paragraph 15(b)(iii) is negative.  The rights set forth 
     in paragraph 15 shall be transferable only to the extent the 
     related option is transferable in accordance with paragraph 
     6(a)(iii).

     16. Corporate Mergers, Acquisitions, etc.  The Board of 
Directors may also grant options, stock appreciation rights, performance 
units, stock bonuses and cash bonuses and issue restricted stock under the 
Plan having terms, conditions and provisions that vary from those specified 
in this Plan provided that any such awards are granted in substitution for, 
or in connection with the assumption of, existing options, stock 
appreciation rights, stock bonuses, cash bonuses, restricted stock and 
performance units granted, awarded or issued by another corporation and 
assumed or otherwise agreed to be provided for by the Company pursuant to 
or by reason of a transaction involving a corporate merger, consolidation, 
acquisition of property or stock, separation, reorganization or liquidation 
to which the Company or a subsidiary is a party.

     17. Amendment of Plan.  The Board of Directors may at any time, 
and from time to time, modify or amend the Plan in such respects as it 
shall deem advisable because of changes in the law while the Plan is in 
effect or for any other reason.  Except as provided in paragraphs 6(a)(iv), 
9, 14 and 15, however, no change in an award already granted shall be made 
without the written consent of the holder of such award.

     18. Approvals.  The obligations of the Company under the Plan 
are subject to the approval of state and federal authorities or agencies 
with jurisdiction in the matter.  The Company will use its best efforts to 
take steps required by state or federal law or applicable regulations, 
including rules and regulations of the Securities and Exchange Commission 
and any stock exchange on which the Company's shares may then be listed, in 
connection with the grants under the Plan.  The foregoing notwithstanding, 
the Company shall not be obligated to issue or deliver Common Stock under 
the Plan if such issuance or delivery would violate applicable state or 
federal securities laws.

     19. Employment and Service Rights.  Nothing in the Plan or any 
award pursuant to the Plan shall (i) confer upon any employee any right to 
be continued in the employment of the Company or any subsidiary or 
interfere in any way with the right of the Company or any subsidiary by 
whom such employee is employed to terminate such employee's employment at 
any time, for any reason, with or without cause, or to decrease such 
employee's compensation or benefits, or (ii) confer upon any person engaged 
by the Company any right to be retained or employed by the Company or to 
the continuation, extension, renewal, or modification of any compensation, 
contract, or arrangement with or by the Company.

     20. Rights as a Shareholder.  The recipient of any award under 
the Plan shall have no rights as a shareholder with respect to any Common 
Stock until the date of issue to the recipient of a stock certificate for 
such shares.  Except as otherwise expressly provided in the Plan, no 
adjustment shall be made for dividends or other rights for which the record 
date occurs prior to the date such stock certificate is issued.