Document:

Exhibit 10.4

                              EMPLOYMENT AGREEMENT

         NOVINT TECHNOLOGIES, INC., a New Mexico corporation (the "Company") and
WALTER A. AVILES (the "Employee") agree:

         1. EMPLOYMENT. The Company hereby employs Employee, and Employee
agrees to serve, as Chief Technical Officer of Company and any subsidiaries or
affiliates of Company (together, the "Subsidiaries"). Subject to the direction
of the Chief Executive Officer, the Employee will be responsible for, in
addition to any other matters assigned to Employee, Company's technical
development, including development of Company's e-touch software, development of
applications and products, and management of technical staff. The Employee
agrees to devote his full business time and attention and best efforts to the
affairs of the Company and the Subsidiaries during the period of Employee's
employment with Company. Employee will execute and deliver to Company the
Proprietary Information and Inventions Agreement required of all Company
employees.

         2. START DATE. The employment of the Employee by the Company under the
terms and conditions of this Agreement will commence as of November 1, 2000.

         3. COMPENSATION. The Employee will receive the following compensation:

                  3.1      ANNUAL SALARY.  The Company shall pay to the Employee
         an annual salary of $100,000.00 (the "Base Salary") payable in
         installments in accordance with Company policy. The Chief Executive
         Officer shall review the performance of the Employee periodically and,
         subject to the sole discretion of the Chief Executive Officer,
         determine whether the Employee is entitled to an increase in the Base
         Salary.

                  3.2 CASH BONUS. The Company may pay to Employee a cash bonus
         (the "Cash Bonus"). Any such bonus will be paid at the sole discretion
         of the Company.

                  3.3 REIMBURSEMENT OF EXPENSES. The Employee shall be entitled
         to receive prompt reimbursement of all reasonable expenses incurred by
         the Employee in performing services hereunder, including all expenses
         of travel, entertainment and living expenses while away from Employee's
         primary residence on business at the request of, or in the service of,
         the Company or any Subsidiary, provided that such expenses are incurred
         and accounted for in accordance with the policies and procedures and
         approved operating budget established by the Company.

                  3.4 BENEFITS. The Employee shall be entitled to participate in
         and be covered by all health, insurance, pension, cash performance or
         profit sharing bonus plans, and other Employee plans and benefits
         established by the Company for its employees generally, subject to
         meeting applicable eligibility requirements.

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                  3.5 PERSONAL LEAVE AND HOLIDAYS. The Employee shall be
         entitled to an annual personal leave of twenty (20) days at full pay.
         Employee may take a reasonable amount of sick leave, which does not
         count as personal leave, subject to company's policies on sick leave.
         The Employee shall also be entitled to ten paid holidays a year. Such
         holidays will be established by the Company for all employees.

                  3.6 STOCK PLAN AND AGREEMENT. Employee shall be eligible to
         participate in Company's employee stock option plan and, pursuant to
         the terms and conditions of the plan and a separate agreement between
         Company and Employee,  shall be granted options to purchase 4,000
         shares of Company common stock.

         4. CONFIDENTIALITY AND NON-COMPETITION. The Employee agrees to the
following confidentiality and non-competition restrictions:

                  4.1 CONFIDENTIALITY. The Employee will not during his
         employment by the Company or thereafter at any time disclose, directly
         or indirectly, to any person or entity or use, or permit the use of,
         any trade secrets or confidential information relating to the Company
         or any Subsidiary (the "Confidential Information") except as required
         by law. "Confidential Information" shall include, but shall not be
         limited to, (i) products or services, (ii) business or strategic plans,
         (iii) designs, (iv) analyses, (v) drawings, photographs and reports,
         (vi) computer hardware and software, including operating systems,
         applications, program listings, and installation plans and techniques,
         (vii) flow charts, manuals and documentations, (viii) data bases, (ix)
         tax or financial data, (x) trade secrets, know-how, inventions,
         devices, new developments, methods and processes, whether patentable or
         unpatentable and whether or not reduced to practice, (xi) customers and
         clients and customers or client lists or other marketing or sales
         programs or plans, (xii) other copyrightable works, (xiii) all
         technology and trade secrets, (xiv) the terms of any agreement for the
         development or commercialization of any invention or technology related
         thereto, (xv) the terms of any license, marketing, sales or
         distribution agreement of Company, (xvi) all information denominated as
         "Confidential" and made available only on a restricted basis and (xvii)
         all similar and related information.; provided however, that
         "Confidential Information" shall not include information which comes
         into the public domain through no fault of the Employee or which the
         Employee obtains after the termination of employment with the Company
         or otherwise from a third party who, to the knowledge of the Employee,
         has the right to disclose such information.

                  4.2 RETURN OF COMPANY MATERIAL. The Employee shall promptly
         deliver to the Company on termination of the Employee's employment with
         the Company, for whatever the reason, or at any time the Company may so
         request, all Company or Subsidiary memoranda, notes, records, reports,
         manuals, drawings, computer software, and all documents containing
         Confidential Information belonging to the Company, including all copies
         of such materials which the Employee may then possess or have under the
         Employee's control irrespective of the format of such materials.

                  4.3 NON-COMPETITION. During the period of Employee's
         employment with the Company and for up to a one-year period thereafter,
         the Employee will not, within the United States, directly or

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         indirectly, without the consent of the Board of Directors of the
         Company: (i) own, manage, operate, join, control, or participate in or
         be connected with, as an officer, employee, partner, stockholder of
         greater than 1% of available shares, director, adviser, consultant, or
         agent (whether paid or unpaid), any business, which is at the time
         engaged in any activities which compete with the business of the
         Company or any Subsidiary; or (ii) utilize any employees of the Company
         to perform any service which conflicts with their full-time employment
         with the Company or otherwise take actions which result in the
         termination of any employee's relationship with the Company. Employee
         hereby acknowledges that because of Company's national presence in its
         industry it is necessary for this section to apply to the entire United
         States in order to adequately protect Company's interests.

                  4.4 RIGHT TO INJUNCTIVE AND EQUITABLE RELIEF As a result of
         the Employee's position as an Employee of the Company, the Employee's
         obligations not to disclose or use Confidential Information and to
         refrain from the activities described in this Section 4 are of a
         special and unique character which gives them a peculiar value, and
         which is supported by valuable consideration. The Company cannot be
         reasonably or adequately compensated in damages in an action at law in
         the event the Employee breaches such obligations. Therefore, the
         Employee expressly agrees that the Company shall be entitled to
         injunctive and other equitable relief without bond or other security in
         the event of such breach in addition to any other rights or remedies
         which the Company may possess. Furthermore, the obligations of the
         Employee and the rights and remedies of the Company under this Section
         4 are cumulative and in addition to, and not in lieu of, any
         obligations, rights, or remedies created by applicable law relating to
         misappropriation or theft of trade secrets or confidential information.

         5. TERMINATION. Company and Employee agree to the following termination
provisions:

                  5.1 TERMINATION BY THE COMPANY. The Chief Executive Officer
         may terminate the Employee's employment hereunder as follows:

                  (a)      Upon the death of the Employee, whereupon this
                           Agreement shall immediately terminate;

                  (b)      Upon a determination of Permanent Disability;
                           "Permanent Disability" shall mean a physical or
                           mental incapacity as a result of which the Employee
                           becomes totally unable to continue the performance of
                           his duties hereunder for a period of 180 consecutive
                           days or an aggregate of 270 days in any 24 month
                           period. A determination of Permanent Disability shall
                           be subject to the certification of a qualified
                           medical doctor agreed to by the Company and the
                           Employee or, in the event of the Employee's
                           incapacity to designate a doctor, the Employee's
                           legal representative. In the absence of agreement
                           between the Company and the Employee, each party

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                           shall nominate a qualified medical doctor and the two
                           doctors so nominated shall select a third doctor, who
                           shall make the determination as to the occurrence and
                           continuance of a Permanent Disability; or

                  (c) For cause. "Cause" shall mean only the following:

                           (i)      the willful and, after written notice and a
                                    reasonable opportunity to cure, continued
                                    failure by the Employee to follow the
                                    reasonable directions of the Chief Executive
                                    Officer not inconsistent with this Agreement
                                    (other than such failure resulting from the
                                    Employee's incapacity due to physical or
                                    mental illness);

                           (ii)     willful and, after written notice and a
                                    reasonable opportunity to cure, continued
                                    misconduct by the Employee that materially
                                    adversely affects the Company;

                           (iii)    conviction of a felony or guilty plea or
                                    plea of nolo contendre to a crime or offense
                                    relating to the performance of the
                                    Employee's duties to the Company;

                           (iv)     willful theft from the Company;

                           (v)      a willful violation of any law, rule or
                                    regulation, or the imposition of a final
                                    order issued by any regulatory authority
                                    against the Company, which, in any event,
                                    prohibits the Employee from holding an
                                    Employee position with the Company or any
                                    Subsidiary;

                           (vi)     the Employee's habitual drunkenness or
                                    habitual use of illegal substances, after
                                    notice to cease and the opportunity provided
                                    by the Company to enter into and
                                    successfully complete a reputable
                                    rehabilitation program at the expense of the
                                    Company; or

                           (vii)    the Employee fails to substantially perform
                                    any material term or provision of this
                                    Agreement.

                  For purposes of this Agreement, no act, or failure to act, on
         the Employee's part shall be considered "willful" unless done, or
         omitted to be done, by the Employee in bad faith and without a
         reasonable belief that such action or omission by the Employee was in
         the best interests of the Company, and no termination by the Company
         for "Cause" shall be effective unless the Employee shall have been
         given written notice of the breaches of this Section 4.1(c) and a
         period of 30 days within which to cure any such breach. provided that
         such curative period shall be permitted only once in any 12 month
         period.

                  (d) Without Cause for any reason or no reason.

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                  5.2 TERMINATION BY EMPLOYEE. The Employee may voluntarily
         terminate his employment hereunder at any time for any reason or no
         reason.

                  5.3 SEVERANCE PAYMENTS; TERMINATION FOR CAUSE. In the event of
         termination for Cause, the Employee shall receive no severance, and
         shall be entitled to receive, in lieu of any other payments or
         benefits, his accrued and unpaid salary at the rate provided in Section
         3.1 (as increased from time to time by the Chief Executive Officer)
         through the date of termination, plus any accrued but unpaid Cash
         Bonus, and plus (i) any amounts earned but unpaid for any benefit plans
         in which Employee is a participant on the date of termination for prior
         completed fiscal or calendar year including any accrued vacation and
         (ii) any unpaid reimbursable expenses incurred prior to the date of
         termination ((i) and (ii) collectively called the "Unpaid Benefits").

                  5.4 SEVERANCE PAYMENTS; TERMINATION AS A RESULT OF DEATH. In
         the event of termination because of the death of Employee, the
         Employee's estate or beneficiaries, as the case may be, shall be
         entitled to receive, in addition to any other payments or benefits
         hereunder, (i) the proceeds from any insurance policies paid for by the
         Company in favor of the Employee's estate or beneficiaries and (ii) any
         Unpaid Benefits. Such amounts shall be paid promptly in a lump sum in
         cash.

                  5.5  SEVERANCE PAYMENTS; TERMINATION WITHOUT CAUSE.  In
         the event of termination by the Company without Cause, the Employee
         shall be entitled to receive (i) Unpaid Benefits through the date of
         termination, plus (ii) an amount equal to any accrued but unpaid Cash
         Bonus (each of the amounts in subclauses (i) and (ii) payable in a lump
         sum in cash within 30 days after the date of termination), plus (iii)
         an amount equal to his Base Salary for a two week period.

                  5.6 SEVERANCE PAYMENTS; VOLUNTARY TERMINATION BY EMPLOYEE. If
         the Employee shall voluntarily resign, he shall be entitled only to
         Unpaid Benefits through the effective date of such resignation or
         voluntary termination, and any such amounts shall be promptly paid in a
         lump sum in cash.

                  5.7 SEVERANCE PAYMENTS; TERMINATION DUE TO PERMANENT
         DISABILITY. If the Employee's employment hereunder is terminated as a
         result of Permanent Disability, in lieu of any other payments or
         benefits (other than any such disability benefits he may receive), he
         shall be paid an amount equal to all Unpaid Benefits in a single lump
         sum in cash within thirty (30) days of the date of his termination.

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                  5.8 GENERAL RELEASE. Prior to the Employee's receipt of any
         severance payment under this Section 5, the Employee shall issue a
         general release to the Company in such form as the Company may
         reasonably require, which release shall extinguish all actual or
         potential claims or causes of action he has, may have had, or hereafter
         may have against the Company. The Company shall simultaneously provide
         a release to the Employee in the same form given to the Company by the
         Employee.

                  5.9 OTHER PAYMENTS UPON TERMINATION. If notice of termination
         of the employment of Employee is given by the Employee or the Company,
         the Employee shall continue to receive his then Base Salary and
         benefits as provided in this Agreement until the date of termination.

         6.       GENERAL PROVISIONS.

                  6.1 NOTICE. For purposes of this Agreement, notices and all
         other communications provided for in the Agreement shall be in writing
         and shall be deemed to have been duly given when delivered or mailed by
         United States registered mail, return receipt required, postage
         prepaid, as follows:

                  If to the Company:
                  Novint Technologies, Inc.
                  8500 Menaul Blvd NE
                  Suite A210
                  Albuquerque, NM  87112
                  Attention: Chief Executive Officer

                  If to Employee:

                  ---------------------------

                  ---------------------------

         or such other address as either party may have furnished to the other
         in writing in accordance herewith, except that notices of change of
         address shall be effective only upon receipt.

                  6.2 NO WAIVERS. No provision of this Agreement may be
         modified, waived or discharged unless such waiver, modification or
         discharge is agreed to in writing signed by the Employee and the
         Company. No waiver by either party hereto at any time or any breach by
         the other party hereto of, or compliance with, any condition or
         provision of this Agreement to be performed by such other party shall
         be deemed a waiver or similar or dissimilar provisions or conditions at
         the same or at any prior or subsequent time.

                  6.3 NO MITIGATION; NO OFFSET. In the event of the Employee's
         termination of employment, he shall be under no obligation to seek
         other employment and there shall be no offset against any amounts due
         the Employee hereunder on account of any remuneration the Employee may
         obtain from any subsequent employment.

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                  6.4 LEGAL FEES. The losing party shall promptly pay or
         reimburse the prevailing party for reasonable costs of enforcing this
         Agreement, including, specifically, the fees and expenses of counsel.

                  6.5 ARBITRATION. Any and all disputes or controversies arising
         out of or relating to this Agreement, other than injunctive relief
         pursuant to Section 4.4, shall be resolved by arbitration at the
         American Arbitration Association at its Albuquerque, New Mexico offices
         before a panel of three arbitrators under the then existing rules and
         regulations of the American Arbitration Association. The parties agree
         that in any such arbitration, the arbitrators shall not have the power
         to reform or modify this Agreement in any way and to that extent their
         powers are so limited. The determination of the arbitrators shall be
         final and binding on the parties hereto and judgment on it may be
         entered in any court of competent jurisdiction. Except as required by
         law, neither the Company nor the Employee shall issue any press release
         or make any statement which is reasonably foreseeable to become public
         with respect to any arbitration or dispute between the parties without
         receiving the prior written consent of the other party to the content
         of such press release or statement. The losing party in such
         arbitration will, in addition to any other amounts deemed payable by
         the losing party, reimburse the prevailing party for the prevailing
         party's expenses (including, without limitation, legal fees and
         expenses) incurred in connection with such proceedings. All such
         amounts shall be paid promptly, but in any event within ten (10) days
         after the Employee provides the Company with a statement of such
         amounts to be recovered.

                  6.6   INDEMNIFICATION.   The Company hereby agrees to hold the
         Employee harmless and indemnify the Employee from and against, and to
         reimburse the Employee for, any and all judgments, fines, liabilities,
         amounts paid in settlement and expenses, including attorneys' fees,
         incurred directly or indirectly as a result of or in connection with
         any threatened, pending or completed action, suit or proceeding,
         whether civil, criminal, administrative or investigative, whether or
         not such action, suit or proceeding is by or in the right of the
         Company to procure a judgment in its favor, including an action, suit
         or proceeding by or in the right of any other corporation of any type
         or kind, domestic or foreign, or any partnership, joint venture, trust,
         employee benefit plan or other enterprise for which the Employee served
         in any capacity at the request of the Company, to which the Employee
         is, was or at any time becomes a party, or is threatened to be made a
         party, or a result of or in connection with any appeal therein, by
         reason of the fact that the Employee is or was at any time a director,
         officer, employee or agent of the Company; provided, however, that (i)
         indemnification shall be paid pursuant to this paragraph if and only if
         the Employee acted in good faith and in a manner reasonably believed by
         the Employee to be in or not opposed to the best interests of the
         Company, and, with respect to any criminal action or proceeding, had no
         reasonable cause to believe the Employee's conduct was unlawful; and
         (ii) no indemnification shall be payable pursuant to this paragraph if
         a court having jurisdiction in the matter shall determine that such
         indemnification is not lawful.

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                  6.7  GOVERNING LAW.  This Agreement shall be governed by and
         construed in accordance with the internal laws of theState of New
         Mexico without regard to its Conflicts of Laws provisions.

                  6.8 SEVERABILITY OR PARTIAL INVALIDITY. The invalidity or
         unenforceability of any provisions of this Agreement shall not affect
         the validity or enforceability of any other provision of this
         Agreement, which shall remain in full force and effect.

                  6.9 COUNTERPARTS. This Agreement may be executed in one or
         more counterparts, each of which shall be deemed to be an original but
         all of which together will constitute one and the same instrument.

                  6.10 ENTIRE AGREEMENT. This Agreement constitutes the entire
         agreement of the parties and supersedes all prior written or oral and
         all contemporaneous oral agreements, understanding, and negotiations
         between the parties with respect to the subject matter hereof. This
         Agreement is intended by the parties as the final expression of their
         agreement with respect of such terms as are included in this agreement
         and may not be contradicted by evidence of any prior or contemporaneous
         agreement. The parties further intend that this Agreement constitutes
         the complete and exclusive statements of its terms and that no
         extrinsic evidence may be introduced in any judicial proceeding
         involving this Agreement.

                  6.11 ASSIGNMENT. This Agreement and the rights, duties and
         obligations hereunder may not be assigned or delegated by any party
         without the prior written consent of the other party. Any such
         assignment or delegation without the prior written consent of the other
         party shall be void and be of no effect. Notwithstanding the foregoing
         provisions of this Section 6.11, the Company may assign or delegate its
         rights, duties and obligations hereunder to any person or entity which
         succeeds to all or substantially all of the business of the Company
         through merger, consolidation, reorganization, or other business
         combination or by acquisition of all or substantially all of the assets
         of the Company; provided that such person assumes the Company's
         obligations under this Agreement.

                  6.12 BENEFICIAL INTERESTS. This Agreement shall inure to the
         benefit of and be enforceable by the Employee's personal and legal
         representatives, executors, administrators, successors, heirs,
         distributees, devisees and legatees. If the Employee should die while
         any amounts are still payable to him hereunder, all such amounts,
         unless otherwise provided herein, shall be paid in accordance with the
         terms of this Agreement to the Employee's devisee, legatee, or other
         designee, or, if there be no such designee, to the Employee's estate.

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                         DATED AS OF: November ___, 2000

COMPANY:                                     EMPLOYEE:

NOVINT TECHNOLOGIES, INC.
                                             ----------------------------------
                                             WALTER A. AVILES

By
   ----------------------------------

   Its
       ------------------------------

                                       9Exhibit 10.5

                            NOVINT TECHNOLOGIES, INC.

                            2004 STOCK INCENTIVE PLAN

                                   ARTICLE ONE

                               GENERAL PROVISIONS

I. PURPOSE OF THE PLAN

         This 2004 Stock  Incentive Plan is intended to promote the interests of
Novint  Technologies,  Inc.,  a  Delaware  corporation  (the  "Corporation")  by
providing  eligible  persons  with the  opportunity  to  acquire  a  proprietary
interest,  or otherwise increase their proprietary  interest, in the Corporation
as an  incentive  for  them  to  remain  in  the  Service  of  the  Corporation.
Capitalized  terms not defined herein,  shall have the meanings assigned to them
in the attached Appendix.

II. STRUCTURE OF THE PLAN

         A. The Plan shall have a Discretionary Option Grant Program under which
eligible  persons may, at the discretion of the Plan  Administrator,  be granted
options to purchase shares of Common Stock.

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

III. ADMINISTRATION OF THE PLAN

         A.  The  Plan  shall  be  administered  by the  Board  or  one or  more
committees appointed by the Board,  provided that (1) beginning with the Section
12  Registration  Date,  the  Primary  Committee  shall have sole and  exclusive
authority to  administer  the Plan with respect to Section 16 Insiders,  and (2)
administration of the Plan may otherwise,  at the Board's discretion,  be vested
in the Primary Committee or a Secondary Committee. Beginning with the Section 12
Registration Date, any discretionary option grants or stock issuances to members
of the Primary  Committee  must be  authorized  and approved by a  disinterested
majority of the Board.

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

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

                                      -1-
<PAGE>

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

IV. ELIGIBILITY

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

                  (i)   Employees,

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

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

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

         C. The Plan Administrator  shall have the absolute  discretion to grant
options in accordance with the Discretionary Option Grant Program.

V. STOCK SUBJECT TO THE PLAN

         A. The stock  issuable under the Plan shall be shares of authorized but
unissued  or  reacquired  Common  Stock,  including  shares  repurchased  by the
Corporation  on the open  market.  The maximum  number of shares of Common Stock
initially  reserved  for  issuance  over the term of the Plan  shall not  exceed
2,500,000  shares.  No one person  participating  in the Plan may receive  stock
options for more than __________________ shares of Common Stock in the aggregate
per calendar year.

         B.  Shares of Common  Stock  subject to  outstanding  options  shall be
available for subsequent issuance under the Plan to the extent (i) those options
expire or terminate for any reason prior to exercise in full or (ii) the options
are cancelled in accordance with the cancellation-regrant  provisions of Article
Two.  Unvested  shares issued under the Plan and  subsequently  cancelled by the
Corporation shall be added back to the number of shares of Common Stock reserved
for issuance  under the Plan and shall  accordingly  be available for reissuance
through one or more subsequent option grants under the Plan. In addition, should
the  exercise  price of an option  under the Plan be paid with  shares of Common
Stock or should  shares of Common  Stock  otherwise  issuable  under the Plan be
withheld by the Corporation in satisfaction of the withholding taxes incurred in
connection  with the  exercise of an option or the  vesting of a stock  issuance
under the Plan, then the number of shares of Common Stock available for issuance
under the Plan shall be reduced only by the net number of shares of Common Stock
issued to the  holder of such  option  or stock  issuance,  and not by the gross
number of shares for which the option is exercised or which vest under the stock
issuance.

                                      -2-
<PAGE>

         C. If any  change  is made to the  Common  Stock by reason of any stock
split,  stock  dividend,  recapitalization,  combination of shares,  exchange of
shares or other change affecting the outstanding Common Stock as a class without
the  Corporation's  receipt of consideration,  appropriate  adjustments shall be
made to: (i) the maximum  number and/or class of securities  issuable  under the
Plan; (ii) the number and/or class of securities for which any one person may be
granted stock options  under this Plan per calendar  year;  and (iii) the number
and/or class of securities and the exercise price per share in effect under each
outstanding  option under the Plan. Such adjustments to the outstanding  options
are to be effected in a manner which shall preclude the  enlargement or dilution
of rights and benefits  under such options.  The  adjustments  determined by the
Plan Administrator shall be final, binding and conclusive.

                                   ARTICLE TWO

                       DISCRETIONARY OPTION GRANT PROGRAM

I. OPTION TERMS

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

         A. EXERCISE PRICE.

                  1. The  exercise  price per  share  shall be fixed by the Plan
Administrator  but shall not be less than eighty-five  percent (85%) of the Fair
Market Value per share of Common Stock on the option grant date, except that the
exercise price shall not be less than one hundred ten percent (110%) of the Fair
Market  Value per share of Common  Stock on the option grant date in the case of
any person who owns stock  possessing  more than ten percent  (10%) of the total
combined  voting  power  of all  classes  of  stock  of the  Corporation  or its
subsidiary corporations.

                  2.  The  exercise  price  shall  become  immediately  due upon
exercise  of the  option  and may,  subject  to the  provisions  of Section I of
Article  Three,  be payable by cash or check  made  payable to the  Corporation.
Payment  of the  exercise  price for the  purchased  shares  must be made on the
Exercise Date, except as otherwise provided by the Plan Administrator.

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

         C. EFFECT OF TERMINATION OF SERVICE.

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

                           (i)  Any  option  outstanding  at  the  time  of  the
         Optionee's cessation of Service for any reason shall remain exercisable
         for such period of time  thereafter  as shall be determined by the Plan
         Administrator and set forth in the documents evidencing the option.

                           (ii) Any option  held by the  Optionee at the time of
         death  and  exercisable  in  whole  or in  part  at  that  time  may be
         subsequently exercised by the personal representative of the Optionee's

                                      -3-
<PAGE>

         estate or by the person or  persons  to whom the option is  transferred
         pursuant  to the  Optionee's  will or in  accordance  with  the laws of
         descent and distribution of by the Optionee's designated beneficiary or
         beneficiaries of that option.

                           (iii) Should the Optionee's Service be terminated for
         Misconduct or should the Optionee  otherwise engage in Misconduct while
         holding one or more  outstanding  options  under this Article Two, then
         all  those  options  shall  terminate   immediately  and  cease  to  be
         outstanding.

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

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

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

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

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

         E.  LIMITED  TRANSFERABILITY  OF  OPTIONS.  During the  lifetime of the
Optionee,  Incentive Options shall be exercisable only by the Optionee and shall
not be assignable or  transferable  other than by will or by the laws of descent
and distribution following the Optionee's death.  Non-Statutory Options shall be
subject  to the same  limitation,  except  that a  Non-Statutory  Option  may be
assigned in whole or in part during  Optionee's  lifetime to one or more members
of the Optionee's  Immediate Family or to a trust  established for the exclusive
benefit of one or more family  members or the Optionee's  former spouse,  to the
extent such assignment is in connection with Optionee's  estate plan or pursuant
to a domestic relations order. The assigned portion shall be exercisable only by
the person or persons who acquire a proprietary  interest in the option pursuant
to such  assignment.  The terms  applicable to the assigned portion shall be the
same as those in effect for this option immediately prior to such assignment and
shall  be set  forth  in such  documents  issued  to the  assignee  as the  Plan
Administrator may deem appropriate.  Notwithstanding the foregoing, the Optionee
may also designate one or more persons as the  beneficiary or  beneficiaries  of
his or her outstanding  options under this Article Two, and those options shall,
in  accordance  with such  designation,  automatically  be  transferred  to such
beneficiary  or  beneficiaries  upon the  Optionee's  death while  holding those
options.  Such  beneficiary or beneficiaries  shall take the transferred  option

                                      -4-
<PAGE>

subject to all the terms and conditions of this  Agreement,  including  (without
limitation)  the limited  time period  during  which the option may be exercised
following the Optionee's death.

II. INCENTIVE OPTIONS

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

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

         B. EXERCISE PRICE.  The exercise price per share shall not be less than
one hundred percent (100%) of the Fair Market Value per share of Common Stock on
the option grant date.

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

         D.  FAILURE TO  QUALIFY AS  INCENTIVE  OPTION.  To the extent  that any
option  governed by this Plan does not qualify as an Incentive  Option by reason
of the dollar  limitation  described  in Section  II.C of Article Two or for any
other reason,  such option shall be exercisable as a Non-Statutory  Option under
the Federal tax laws.

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

III. CANCELLATION AND REGRANT OF OPTIONS

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

IV. CHANGE IN CONTROL/HOSTILE TAKE-OVER

         A. No  option  outstanding  at the time of a Change  in  Control  shall
become exercisable on an accelerated basis if and to the extent: (i) that option
is,  in  connection  with  the  Change  in  Control,  assumed  by the  successor
corporation (or Parent thereof) or otherwise  continued in full force and effect
pursuant to the terms of the Change in Control transaction,  (ii) such option is
replaced  with a cash  incentive  program  of the  successor  corporation  which
preserves the spread existing at the time of the Change in Control on the shares
of Common Stock for which the option is not  otherwise at that time  exercisable

                                      -5-
<PAGE>

and provides for subsequent payout in accordance with the same  exercise/vesting
schedule  applicable  to those option shares or (iii) the  acceleration  of such
option is subject to other limitations  imposed by the Plan Administrator at the
time of the option  grant.  However,  if none of the  foregoing  conditions  are
satisfied, then each option outstanding at the time of the Change in Control but
not  otherwise  exercisable  for all the  shares  of  Common  Stock at that time
subject to such option shall  automatically  accelerate so that each such option
shall,  immediately prior to the effective date of the Change in Control, become
exercisable  for all the  shares of  Common  Stock at the time  subject  to such
option  and may be  exercised  for any or all of those  shares  as fully  vested
shares of Common Stock.

         B. Immediately following the consummation of the Change in Control, all
outstanding  options shall terminate and cease to be outstanding,  except to the
extent  assumed by the successor  corporation  (or Parent  thereof) or otherwise
expressly continued in full force and effect pursuant to the terms of the Change
in Control transaction.

         C. Each option which is assumed in connection  with a Change in Control
or otherwise  continued in effect shall be appropriately  adjusted,  immediately
after such  Change in  Control,  to apply to the number and class of  securities
which would have been issuable to the Optionee in consummation of such Change in
Control  had the  option  been  exercised  immediately  prior to such  Change in
Control. Appropriate adjustments to reflect such Change in Control shall also be
made to: (i) the exercise price payable per share under each outstanding option,
provided the aggregate  exercise price payable for such securities  shall remain
the same;  (ii) the maximum  number  and/or class of  securities  available  for
issuance  over the  remaining  term of the Plan;  and (iii) the  maximum  number
and/or class of securities for which any one person may be granted options under
the  Plan  per  calendar   year.  To  the  extent  the  actual  holders  of  the
Corporation's  outstanding  Common Stock  receive cash  consideration  for their
Common Stock in consummation of the Change in Control transaction, the successor
corporation  may, in connection with the assumption of the  outstanding  options
under the Discretionary  Option Grant Program,  substitute one or more shares of
its  own  common  stock  with  a  fair  market  value  equivalent  to  the  cash
consideration  paid  per  share  of  Common  Stock  in such  Change  in  Control
transaction.

         D. The Plan  Administrator  shall have the  discretionary  authority to
structure one or more outstanding  options under the Discretionary  Option Grant
Program so that those options shall,  immediately prior to the effective date of
a Change in Control,  become  exercisable  for all the shares of Common Stock at
that time subject to such options on an  accelerated  basis and may be exercised
for any or all of such shares as fully vested shares of Common Stock, whether or
not those  options are to be assumed or  otherwise  continued  in full force and
effect pursuant to the express terms of the Change in Control transaction.

         E. The Plan  Administrator  shall  have  full  power and  authority  to
structure one or more outstanding  options under the Discretionary  Option Grant
Program so that those  options  shall  vest and become  exercisable  for all the
shares of Common Stock at that time  subject to such  options on an  accelerated
basis in the event the Optionee's  Service is subsequently  terminated by reason
of an Involuntary Termination within a designated period (not to exceed eighteen
(18)  months)  following  the  effective  date of any Change in Control in which
those  options do not otherwise  accelerate.  Any options so  accelerated  shall
remain  exercisable for fully vested shares of Common Stock until the expiration
or sooner termination of the option term.

         F. The Plan  Administrator  shall have the  discretionary  authority to
structure one or more outstanding  options under the Discretionary  Option Grant
Program so that those options shall,  immediately prior to the effective date of
a Hostile  Take-Over,  vest and become  exercisable for all the shares of Common
Stock at that time  subject to such options on an  accelerated  basis and may be
exercised for any or all of such shares as fully vested shares of Common Stock.

                                      -6-
<PAGE>

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

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

                                  ARTICLE THREE

                                  MISCELLANEOUS

I. FINANCING

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

II. TAX WITHHOLDING

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

III. EFFECTIVE DATE AND TERM OF THE PLAN

         A. The Plan shall become effective  immediately upon the Plan Effective
Date. Options may be granted under the Discretionary Option Grant at any time on
or after the Plan Effective Date. However, no options granted under the Plan may
be  exercised,  and no shares shall be issued under the Plan,  until the Plan is
approved by the Corporation's stockholders.  If such stockholder approval is not
obtained  within  twelve (12) months  after the Plan  Effective  Date,  then all
options  previously  granted  under  this Plan shall  terminate  and cease to be
outstanding,  and no further  options  shall be granted  and no shares  shall be
issued under the Plan.

         B.  The  Plan  shall  terminate  upon  the  EARLIEST  of (i) the  tenth
anniversary  of the Plan  Effective  Date,  (ii) the  date on which  all  shares
available  for  issuance  under the Plan shall have been issued as  fully-vested
shares or (iii) the termination of all outstanding  options in connection with a
Change in Control. Upon such plan termination, all outstanding option grants and
unvested stock issuances shall  thereafter  continue to have force and effect in
accordance  with the  provisions  of the  documents  evidencing  such  grants or
issuances.

                                      -7-
<PAGE>

IV. AMENDMENT OF THE PLAN

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

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

V. USE OF PROCEEDS

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

VI. REGULATORY APPROVALS

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

         B. No  shares  of  Common  Stock or other  assets  shall be  issued  or
delivered  under the Plan unless and until there shall have been compliance with
all applicable  requirements of Federal and state securities laws, including the
filing and  effectiveness of the Form S-8 registration  statement for the shares
of Common Stock issuable under the Plan, and all applicable listing requirements
of any stock exchange (or the Nasdaq  National  Market,  if applicable) on which
Common Stock is then listed for trading.

VII. NO EMPLOYMENT/SERVICE RIGHTS

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

X. FINANCIAL REPORTS

         THE CORPORATION  SHALL DELIVER  FINANCIAL REPORTS AND OTHER INFORMATION
IF SUCH  REPORTS  AND  INFORMATION  IS  REQUIRED  TO BE  DELIVERED  PURSUANT  TO
APPLICABLE LAW.

                                      -8-
<PAGE>

                                    APPENDIX

         The following definitions shall be in effect under the Plan:

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

B.  CHANGE  IN  CONTROL  shall  mean a change in  ownership  or  control  of the
Corporation effected through any of the following transactions:

         (i) a stockholder-approved  merger or consolidation in which securities
possessing  more than fifty percent (50%) of the total combined  voting power of
the Corporation's  outstanding securities are transferred to a person or persons
different from the persons holding those  securities  immediately  prior to such
transaction;

         (ii) a sale,  transfer or other disposition of all or substantially all
of the Corporation's assets; or

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

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

D. COMMON STOCK shall mean the Corporation's common stock.

E. CORPORATION shall mean Novint Technologies, Inc., a Delaware corporation, and
its successors.

F. DISCRETIONARY  OPTION GRANT PROGRAM shall mean the discretionary option grant
program in effect under the Plan.

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

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

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

         (i) if the Common  Stock is then listed or quoted on a Trading  Market,
the Fair Market Value is the daily volume  weighted  average  price per share of
the Common  Stock for such date (or the nearest  preceding  date) on the primary
Trading Market on which the Common Stock is then listed or quoted;

         (ii) if the  Common  Stock is not then  listed or quoted on an  Trading
Market and if prices for the Common Stock are then reported in the "Pink Sheets"
published  by  the  National   Quotation  Bureau   Incorporated  (or  a  similar
organization  or agency  succeeding to its functions of reporting  prices),  the
Fair Market  Value is the most recent bid price per share of the Common Stock so
reported; or

                                      -1-
<PAGE>

         (iii) in all other  cases,  the Fair Market  Value of a share of Common
Stock shall be  determined by the Plan  Administrator  after taking into account
such factors as the Plan Administrator shall deem appropriate.

J. HOSTILE TAKE-OVER shall mean:

         (i) the acquisition,  directly or indirectly,  by any person or related
group of persons  (other  than the  Corporation  or a person  that  directly  or
indirectly  controls,  is controlled  by, or is under common  control with,  the
Corporation)  of beneficial  ownership  (within the meaning of Rule 13d-3 of the
1934 Act) of  securities  possessing  more than fifty percent (50%) of the total
combined voting power of the Corporation's  outstanding securities pursuant to a
tender or exchange offer made directly to the Corporation's  stockholders  which
the Board does not recommend such stockholders to accept; or

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

K.  IMMEDIATE  FAMILY  shall  mean any  child,  stepchild,  grandchild,  parent,
stepparent,   grandparent,   spouse,  sibling,   mother-in-law,   father-in-law,
son-in-law, daughter-in-law, brother-in-law, or sister-in-law, and shall include
adoptive relationships.

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

         (i) INVOLUNTARY  TERMINATION  shall mean the termination of the Service
of any  individual  which  occurs  by reason  of such  individual's  involuntary
dismissal or discharge by the Corporation for reasons other than Misconduct.

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

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

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

P.  OPTIONEE  shall  mean any  person  to whom an option  is  granted  under the
Discretionary Option Grant Program.

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

                                       -2-
<PAGE>

R. PLAN shall mean the Corporation's  2004 Stock Incentive Plan, as set forth in
this document.

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

T. PLAN  EFFECTIVE DATE shall mean the date on which the Plan was adopted by the
Board.

U. PRIMARY  COMMITTEE  shall mean the committee of two (2) or more  non-employee
Board members  appointed by the Board to  administer  the  Discretionary  Option
Grant with respect to Section 16 Insiders  following the Section 12 Registration
Date.

V. SECONDARY  COMMITTEE  shall mean a committee of two (2) or more Board members
appointed by the Board to administer  any aspect of Plan not required  hereunder
to be  administered  by the  Primary  Committee.  The  members of the  Secondary
Committee  may  be  Board   members  who  are  Employees   eligible  to  receive
discretionary  option grants, stock bonus or other stock plan of the Corporation
(or any Subsidiary).

W. SECTION 12 REGISTRATION DATE shall mean the date on which the Common Stock is
first registered under Section 12(g) or Section 15 of the 1934 Act.

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

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

Z. SHORT TERM  FEDERAL  RATE shall mean the  federal  short-term  rate in effect
under Section 1274(d) of the Code for the period the shares were held in escrow.

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

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

CC. TAXES shall mean the  Federal,  state and local  income and  employment  tax
liabilities  incurred by the holder of Non-Statutory  Options or unvested shares
of Common Stock in connection  with the exercise of those options or the vesting
of those shares.

DD. TRADING MARKET means the following  markets or exchanges on which the Common
Stock is listed or quoted for trading on the date in question:  the OTC Bulletin
Board,  the American Stock  Exchange,  the New York Stock  Exchange,  the Nasdaq
National Market or the Nasdaq SmallCap Market.

                                      -3-
<PAGE>

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

                                      -4-

Source: [{"source": "alea-institute/alea-institute/kl3m-data-edgar-agreements/train-00066-of-00352.parquet"}, [{"source": "alea-institute/alea-institute/kl3m-data-edgar-agreements/train-00066-of-00352.parquet"}]]