Document:

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                                                                   Exhibit 10.1

           This Agreement, effective as of the 15TH day of September, 2000 is
between L.E. LAWSON ("Owner"), whose address is 16267 Highway #2 North Republic,
Washington 99166 and NAVIGATOR VENTURES INC. incorporated in the State of Nevada
and qualified to do business in the State of Washington ("Navigator"), whose
address is Navigator International Minerals 201-1425 Marine Drive West
Vancouver, British Columbia Canada V2T 1B9.

RECITALS

           Owner represents that he owns 100% of the mineral estate of the Zala
M Group mineral claims and is in possession of certain lands in northeastern
Washington state (the "Property"), more particularly described in Exhibit A,
including the area of interest and

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attached hereto and incorporated by reference herein.

           Navigator desires to obtain and Owner is willing to grant a lease of
the Property for mining purposes exclusive of the surface rights excepting that
surface area required for mining purposes.

           NOW THEREFORE, in consideration of One Thousand Dollars ($1000.00)
Canadian, the receipt and sufficiency of which are hereby acknowledged, and
further in consideration of the mutual covenants, agreements, and promises
herein contained, the parties hereto agree as follows:

         1.       LEASE. Owner leases the Property to Navigator for mining
purposes, reserving to Owner the right to reside, graze, farm and harvest timber
on the Property, and to occupy the surface of the Property for such purposes so
long as there is no interference with Navigator's rights under this Agreement.

         2.       TERM.
(a) The initial term of this Agreement shall be Ten (10) years from the date
hereof, unless sooner surrendered or otherwise terminated.

(b) Navigator may extend the initial term of this Agreement for two (2)
additional periods of Ten (10) years each by giving Owner notice of such
extension not less than thirty (30) days prior to the expiration of the initial
term or any extension thereof.

3.       EXCLUSIVE POSSESSION. Navigator shall have the exclusive possession of
the Property for mining purposes during the term of this Agreement.

      TITLE.
(a) Owner warrants that it is in possession of the Property, that it has the
right to enter into this Agreement, that except as specifically set forth in
Part II of Exhibit A if any, it knows of no other person claiming any interest
in the Property, and that except as specifically set forth in Part II of Exhibit
A. if any, the Property is free from all liens and encumbrances, except liens
for property taxes not yet due and payable. Owner further warrants to Navigator
the quiet enjoyment of the Property and the right to explore, develop, and mine
the same.

(b) Owner warrants and will defend title to the Property against all persons
whomsoever.

(c) Owner shall provide Navigator with recording data with respect to deeds,
easements, or other documents which bear upon Owner's title to the Property, and
shall provide Navigator with copies of all such documents and copies of all
title reports and abstracts in Owner's possession or control. Owner shall upon
Navigator's request, record any such document in Owner's possession or control
which has not been recorded.

(d) At Navigator's request, Owner shall take all action necessary (including
judicial

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proceedings) to remove any cloud from or cure any defect in his title to the
Property or the ground covered thereby. If Owner fails or refuses to take any
such action, Navigator may take any such action in Owner's name. Owner agrees to
cooperate with Navigator in any such action taken. Navigator may recover from
any production royalty payments thereafter to become due to Owner hereunder all
costs and expenses (including attorneys' fees) incurred by Navigator any such
action.

         5.       UNDIVIDED INTEREST. If the interest claimed by Owner in any
portion of the Property is less than one hundred percent (100%), the interest
claimed by Owner is set forth in Exhibit A. Any representation or warranty of
title made by Owner shall apply only to the interest set forth in Exhibit A.

         6.       HOMESTEAD EXEMPTION. Owner waives and releases all rights,
exemptions, and benefits under or by virtue of any homestead, homestead
exemption, dower, or courtesy laws, now or hereafter applicable or in force in
the jurisdiction in which the property is located.

ROYALTY.
(a) Navigator shall pay to Owner in Canadian funds, a minimum royalty on the
dates and in the amount subject to the Agreement as follows:

<TABLE>
<CAPTION>
           Anniversary Date               Amount
<S>                                       <C>
           Sept. 30,2000                  $ 1,000.00
           Sept.30,2001                   $ 5,000.00
           Sept.30,2002                   $10,000.00
           Sept.30,2003                   $20,000.00
           Sept.30,2004 &thereafter       $40,000.00
</TABLE>

(b) Notwithstanding the provisions of Paragraph 23 (c) herein, Navigator shall
be obligated to make the minimum royalty payment due on the Anniversary Date in
2000 (c) Navigator shall pay to Owner a royalty of 2 1/2% of the Net Returns
from all ores, minerals, concentrates, or other products mined and removed from
the Property and sold or processed by Navigator. There shall be credited against
the production royalty payments provided for in this subparagraph (b) all
minimum royalties theretofore paid pursuant to the foregoing subparagraph (a).

(d)   "Net Returns" means:

           (i) in the case of ores, minerals, or other products which are sold
by Navigator in the crude state, the amount received by Navigator from the
purchaser of the ores, minerals, or other products, less the following items to
the extent borne by Navigator: sales, severance, and other similar taxes and
charges for and taxes on transportation from the mine to the place of sale,

           (ii) in the case of ores, minerals, or other products which are
processed by or for the account of Navigator and sold as concentrates or other
intermediate products, the

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amount received by Navigator from the purchaser of the concentrates or other
intermediate products, less the following items to the extent borne by
Navigator: sales, severance, and other similar taxes, purchaser's smelter or
other processing charges or costs, and charges for and taxes on transportation
from the plant producing the concentrates or other intermediate products to the
place of sale,

           (iii) in the case of ores, minerals or other products which are
processed by or for the account of Navigator to produce concentrates or other
salable intermediate products which are smelted or otherwise further processed
by or for the account of Navigator, the market value of the concentrates or
other salable intermediate products f.o.b. the plant producing the concentrates
or other salable intermediate products, less any amount equal to the sales,
severance, or other similar taxes which would have been imposed had the
concentrates or other salable intermediate products been sold, and

           (iv) in all other cases, the amount received by Navigator from the
purchaser of the ores, minerals, concentrates, or other products, less the
following items to the extent borne by Navigator: sales, severance, and other
similar taxes, purchaser's treatment charges or costs, and charges for and taxes
on transportation from the mine to the place of sale.

(e)      All royalty payments with respect to ores, minerals, or other products
which are sold by Navigator in the crude state or as concentrates or other
intermediate products shall be made on or before the 25th day of the month
following the calendar quarter in which payment is received for such ores,
minerals, or other products. All royalty payments with respect to ores,
minerals, or other products which are processed by or for the account of
Navigator to produce concentrates or other salable intermediate products which
are smelted or otherwise further processed by or for the account of Navigator
shall be made on or before the 25th day of the month following the calendar
quarter in which such ores, minerals, or other products are first processed. All
royalty payments shall be accompanied by a statement indicating the amount of
ores, minerals, concentrates, or other products sold or processed and the
computation of the royalty being paid.

(f)      Within ninety (90) days after the end of Navigator's fiscal year,
Navigator will furnish an unaudited year end statement showing the amount of
royalties paid Owner during the fiscal year. All year end statements shall be
conclusively presumed true and correct after the expiration of three (3) months
from the date furnished, unless within the three-month period Owner takes
written exception, specifying with particularity the items excepted to and the
ground for each exception. Owner shall be entitled to an annual independent
audit of the matters covered by the statement, at his expense, provided he
selects for the audit an accounting firm of recognized standing, at least one of
whose members is a Registered Chartered Accountant in Canada.

(g)      If at any time during the term of this Agreement it appears that one or
more third parties may have a claim of ownership in the Property, the minerals
lying in or under the Property, or royalties or other payments with respect to
the Property, Navigator may

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withhold from any payments which would otherwise be due to Owner under the terms
of this Agreement an amount sufficient to satisfy the claims. Navigator shall
deposit the amount withheld in escrow, giving notice of the deposit to Owner,
the amount to remain in escrow until the controversy is resolved by decision of
a court, or otherwise. Owner shall pay when due and before delinquent all taxes
required by this Agreement to be paid by Owner and all mortgage and other
payments required to preserve Owner's interest in the Property. Owner shall
furnish Navigator with receipts or other evidence of such payments. If at any
time during the term of this Agreement it appears that any one or more third
parties may have a claim against the Property by reason of any tax, mortgage, or
other lien, Navigator may pay any past due payments and shall be subrogated to
all rights of the holder against Owner. If Navigator makes any payments to one
or more third parties as a result of any claim of ownership, tax, mortgage or
lien, either by way of contract, settlement, compromise, pursuant to final
judgement of any court of record, or otherwise, Navigator may recover from Owner
or from any payments thereafter to become due to Owner hereunder the amount of
any payment and all costs and expenses (including attorneys' fees) incurred by
Navigator in connection with the claim of ownership, tax mortgage, or lien.

(h)      If Navigator stockpiles any ores, minerals or other products upon other
property for a period longer than six (6) months, Navigator shall pay Owner a
provisional royalty of seventy-five (75%) of the estimated royalty. When such
ores, minerals, or other products are sold or processed by Navigator, Navigator
shall pay to or recover from Owner the difference between the provisional
royalty paid and the amount of royalty determined as provided in subparagraph
(d), above.

         8.       WORK OBLIGATION. On or before the Second Anniversary date of
this agreement, Navigator shall have performed work on or for the benefit of the
Property in an amount equivalent to $10,000.00 Canadian. The type and nature of
such work shall be at the sole discretion of Navigator.

         9.       STOCKPILING. Navigator may stockpile any ores, minerals, or
other products form the Property at such place or places as Navigator may elect,
either upon the Property or upon other property.

         10.      COMMINGLING. Navigator may commingle ore, minerals,
concentrates, or other products from the Property ("Subject Ore") with ore,
minerals, concentrates, or other products from other property ("Other Ore").
Before commingling, Navigator shall weigh and sample the Subject Ore and Other
Ore in accordance with sound mining and metallurgical practice for moisture and
metal content and assay the samples to determine metal content. Navigator shall
keep records showing weights, moisture, percent metal content, and gross metal
content of the Subject Ore and Other Ore. Royalties shall be allocated between
Subject Ore and Other Ore on the basis of gross metal content, with regard being
given to the difference, if any, between the royalty rate on Subject Ore and the
royalty rate on Other Ore.

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         11.      PAYMENTS. (a) Navigator shall make all payments due Owner
hereunder (except for the amount paid directly to Owner upon execution of this
Agreement) by check, which shall be made payable to and shall be transmitted
to_________________ whose address is_______or any successor back (the "Bank"),
with instructions to deposit the same to Owner's credit. Upon making the payment
to the Bank, Navigator shall be deemed to have made the payment to the Owner,
its heirs, representatives, successors, and assigns, and thereupon Navigator
shall be discharged to the same extent as if the payment had been made to Owner
or to any person, firm, or corporation entitled thereto, and Navigator shall not
be liable for the ultimate distribution or receipt of any payment. Owner shall
instruct the Bank as to the disbursement of the payments and shall bear all
charges of the Bank relating to the receipt and disbursement of the payments. If
any person entitled to payments under this Agreement dies, Navigator may make
the payments to the credit of the personal representatives of the deceased at
the Bank. If the Bank should fail, liquidate, or be succeeded by another bank,
or if for any reason it should not accept any payment, Navigator shall not be in
default with respect to the payment until thirty (30) days after Owner has
delivered to Navigator an instrument signed by Owner and by the Bank therein
named, naming another bank to receive and disburse payments hereunder.

(b)      If no bank is named in the preceding subparagraph (a), Navigator may
make all payments due Owner hereunder either (i) by check which shall be made
payable to all Owners jointly and shall be transmitted as provided in paragraph
27, entitled "Notices", or (ii) by separate checks which shall be payable to
each individual Owner separately and shall be transmitted to each individual
Owner at such address as Navigator may have for such Owner. In determining the
amount payable to each individual Owner, Navigator may assume, in absence of
anything to the contrary set forth in this Agreement, that the Property is held
in equal undivided interests by all individual Owners, and that a husband and
wife own equal undivided interests.

         12.      OPERATIONS.
(a)      During the term of this Agreement, Navigator shall have free and
unrestricted access to the Property, and shall have the right:

           (i) to explore, develop, and mine the Property, and to extract,
remove, and sell or otherwise dispose of for its own account any and all ores,
minerals, concentrates, or other products,

           (ii) to remove ores, air, water, waste, and materials from the
Property by means of underground or surface operations on or in the Property,

           (iii) to deposit ores, water, waste, and materials from the Property
or other property on or in the Property, and to use any part of the Property for
waste dumps and tailing disposal areas,

           (iv) to conduct on or in the Property general mining, milling,
processing, and related operations respecting the Property and other property,
and to use any part of the

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Property for any purposes incident to such operations, and

           (v) to erect, construct, use, and maintain on the Property such
roads, buildings, structures, machinery, equipment, personal property, fixtures,
and improvements as may be necessary or convenient for the conduct of
Navigator's operations.

(b)      Navigator shall conduct all operations on the Property in a good and
workmanlike manner and in accordance with accepted mining practice. All
decisions with respect to exploration, development, and mining of the Property
and the selling of ores, minerals, concentrates, or other products from the
Property, including all decisions regarding the commencement, suspension,
resumption, or termination of any operations, shall be made by Navigator in its
sole discretion. Navigator may sell ores, minerals, concentrates, or other
products, and may stockpile ores, minerals, concentrates, or other products for
any length of time before selling the same. there are no covenants or agreements
regarding these matters other than those expressly set forth herein.

(c)      Navigator may use any mining method, whether or not the method is in
general use at the time of the execution of this Agreement, including, without
limitation, underground mining (including methods, such as block caving, which
result in the disturbance or subsidence of the surface), surface mining
(including strip mining, open pit mining, and dredging), and in situ mining
(including solution mining, leaching, gasification, and liquefication).

(d)      Navigator shall comply with all laws and regulations governing its
operations on the Property. If this Agreement is inconsistent with or contrary
to any law or regulation, the law or regulation shall control and this Agreement
shall be deemed to be modified accordingly.

(e)      Navigator may use existing roads, if any, on the Property, and may
construct and maintain at its own expense any additional roads reasonably
necessary or convenient for the conduct of Navigator's operations on the
Property or on other property. Navigator will endeavor to construct any such
additional roads on the Property at a location agreeable to Owner and Navigator.
All additional roads shall be constructed and maintained in such manner to bear
the traffic necessary to Navigator's operations. Owner may use any additional
road so long as its use does not interfere with Navigator's use. Upon notice to
Navigator given within thirty (30) days after the termination of this Agreement,
Owner may require that all or any part of any additional road be plowed up.

(f)      If Navigator finds it necessary to cut any fence on the Property for
the purpose of passage, Navigator shall, prior to cutting the fence, install and
brace heavy "corner type" posts at each end of the opening to be made, to which
the fence wire shall be securely fastened in such manner as to prevent sagging.
Navigator shall install a gate of a quality acceptable to Owner in each opening.
If Navigator desires that openings provide uninterrupted ingress and egress, it
may in the alternative install cattle guards of sufficient size and substance to
bear the type of traffic necessary for its operations and capable of turning all
domestic livestock.

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(g)      Navigator shall conduct no surface operations within one hundred (100)
feet of the main dwelling house, if any, now located on the Property without
first obtaining the written consent of Owner, which consent will not
unreasonably be withheld.

(h)      Neither Navigator nor its agents, employees, contractors, or
subcontractors, nor their agents or employees, shall hunt or fish on the
Property, nor shall any of them carry onto the Property firearms or other
equipment designed or adapted for such purposes.

         13.      DUMPS and TAILINGS. All dumps, tailings, or residue remaining
after mining, milling, or subsequent processing of ores, minerals, concentrates,
or other products from the Property shall be the sole and exclusive property of
Navigator, unless such dumps, tailings, or residue remain upon the Property
after the period of the time provided for in paragraph 24, entitled "Removal of
Property", in which case the dumps, tailings, or residue shall be the property
of Owner.

         14.      NO IMPLIED COVENANTS. No covenants or conditions relating to
the exploration, development, mining, or related operations on or in connection
with the Property, or the timing thereof, other than those expressly provided in
this Agreement, shall be implied. After commencing any exploration, development,
mining, or related operations on or in connection with the Property, or the
timing thereof other than those expressly provided in this Agreement, shall be
implied, After commencing any exploration, development, mining or related
operations on or in connection with the Property, Navigator may in its sole
discretion curtail or cease such operations so long as it continues to make any
payments due Owner under this Agreement.

         15.      DAMAGES. Navigator shall pay Owner reasonable compensation for
any damage to livestock, crops, timber, fences, buildings, or other tangible
improvements on the Property resulting from Navigator's operations on the
Property.

         16.      WATER and MATERIALS.

(a)      To the extent that Owner may do so, Owner grants to Navigator the free
use of water from the Property for use in Navigator's operations, but Navigator
shall not use water from Owner's wells, tanks, or surface reservoirs without
first obtaining the written consent of Owner.

(b)      Navigator shall conduct its operations, insofar as practicable, so as
not to damage any water supply of Owner, If, in order to properly mine the
Property, Navigator damages or destroys any water supply, it shall with all
reasonable diligence repair, restore, or replace any well, tank, reservoir, or
other water facility so as to provide a facility of a capacity and quality
substantially as good as that damaged or destroyed, or pay reasonable
compensation for such damage or destruction.

(c)      Upon termination of this Agreement, Navigator shall offer to transfer
any well in

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which water was discovered on the Property to Owner on an "as is" basis. Prior
to abandoning or plugging any well on the Property in which water was
discovered, Navigator shall give Owner seven (7) days notice of its intended
action. Upon notice Navigator given within the seven-day period, Navigator shall
transfer the well to Owner. Owner shall, at Owner's sole cost and expense,
obtain all permits and perform all acts that may be necessary to complete the
well, and shall indemnify, defend, and hold Navigator harmless from any and all
liability relating to the well after it is transferred to Owner.

(d)      To the extent that Owner may do so, Owner grants Navigator the free use
of timber, stone, sand, and gravel, clay, earth, and other materials from the
Property for use in Navigator's operations.

         17.      PROTECTION FROM LIENS and DAMAGES. Navigator shall keep the
Property free of liens for labor performed or materials or merchandise furnished
for use on the Property under this Agreement, and shall hold Owner harmless from
all costs, loss, or damage which may result from any work or operations of
Navigator or its occupancy of the Property.

         18.      TAXES. Owner shall pay all taxes levied against the Property
prior to the date of this Agreement. Navigator shall pay or reimburse Owner for
all taxes levied against the Property during the term of this Agreement to the
extent that such taxes are assessed or levied solely upon the mineral estate in
the Property or are based upon Navigator's operations. Owner will pay the
balance of such taxes. In the case of taxes for the calendar year in which this
Agreement commences, and for the calendar year in which this Agreement ends,
there shall be an apportionment between the parties, Navigator to bear the
proportion of taxes upon the Property applicable to the part of the calendar
year included hereunder, and Owner to bear the balance of the taxes. Navigator
shall pay all taxes levied during the term of this Agreement against all
buildings, structures, machinery, equipment, personal property, fixtures, and
improvements placed upon the Property by Navigator, and all taxes levied against
Navigator as an employer of labor. All taxes shall be paid when due and before
delinquent, but Navigator shall be under no obligation to pay any tax so long as
the tax is being contested in good faith and by appropriate legal proceedings
and the nonpayment thereof does not adversely affect any right, title, or
interest of Owner in or to the Property.

         19.      INSURANCE. Navigator shall carry at all times during the term
of this Agreement worker's compensation and other insurance required by
provincial laws and mining regulations.

         20.      INSPECTION.

(a) Owner or its authorized representative may enter on the Property at any
reasonable time for the purpose of inspection, but shall enter at Owner's own
risk and so as not to hinder unreasonably the operations of Navigator. Owner
shall indemnify and hold Navigator harmless from any damage, claim or demand by
reason of injury to or the presence of Owner, its agents or representatives on
the Property.

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(b)      Owner or its authorized representative may, at any reasonable time,
inspect any records pertinent and necessary for substantiating the compliance of
Navigator with the provisions of this Agreement.

         21.      DATA.
(a)      Upon the execution of this Agreement, Owner shall deliver to Navigator
all drill core, all geological, geophysical, and engineering data and maps, logs
of drill holes, results of assaying and sampling, and similar data concerning
the Property (or copies thereof) which are in Owner's possession or control.

(b)      Upon the surrender or other termination of this Agreement Navigator
shall, within sixty (60) days after termination, (i) return to Owner all drill
core and original data delivered by Owner to Navigator which are then in
Navigator's possession or control, and (ii) make available for inspection by
Owner all factual geological and geophysical data and maps (not including
interpretive data), logs of drill holes, drill core, and results of assaying and
sampling pertaining to the Property which Navigator has obtained as a result of
its exploration work under this Agreement and which are then in Navigator's
possession or control. Upon Owner's request made within sixty (60) days after
termination of this Agreement, Navigator shall, at Owner's expense, provide
Owner with the drill core designated by Owner and with copies of any portion of
the factual geological and geophysical data and maps (not including interpretive
data), logs of drill holes, and results of assaying and sampling designated by
Owner. Navigator makes no representation or warranty as to the accuracy or
completeness of any such data or information, and shall not be liable on account
of any use by Owner or any other person of any such data or information.
Navigator shall not be liable for the loss or destruction of any drill core.

         22.      CONFIDENTIALITY. All information obtained by Navigator or its
authorized representatives from Navigator arising out of Navigator's activities
on the Property pursuant to this Agreement shall be kept strictly confidential
by Owner and shall hot be released to any third party except upon the prior
written consent of Navigator.

         23.      TERMINATION and SURRENDER.
(a)      If Navigator fails to comply with any of the provisions of this
Agreement, including paragraph 7, entitled "Royalty", and if Navigator does not
initiate and diligently pursue steps to correct the default within thirty (30)
days after notice has been given to it by Owner specifying with particularity
the nature of the default, then upon the expiration of the thirty-day period,
all rights of Navigator under this Agreement (except as provided in paragraphs
24 and 25, entitled "Removal of Property" and "Access") shall terminate, and all
liabilities and obligations of Navigator (except liabilities existing of the
date of termination, except as provided in paragraph 21, entitled "Royalty" then
due or, in the case of production royalties, then accrued) shall terminate. Any
default claimed with respect to the payment of money may be cured by the deposit
in escrow of the amount in controversy (not including claimed consequential,
special, exemplary, or punitive damages) and giving of notice of the deposit to
Owner, the amount to remain in escrow

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until the controversy is resolved by decision of a court or otherwise. If
Navigator by notice to Owner disputes the existence of a default, then this
Agreement shall not terminate unless Navigator does not initiate and diligently
pursue steps to correct the default within thirty (30) days after the existence
of a default has been determined by decision of a court or otherwise.

(b)      Subject to the right of Owner to terminate this Agreement as provided
in the foregoing subparagraph (a), controversy between the parties hereto shall
not interrupt performance of this Agreement or the continuation of operations
hereunder. In the event of any controversy, Navigator may continue operations
hereunder and shall make the payments provided for herein notwithstanding the
existence of the controversy. Upon the resolution of the controversy, such
payments or restitutions shall be made as required by the terms of the decision
of the court or arbitrators, or otherwise.

Navigator may at any time terminate this Agreement as to all or any part of the
Property by delivering to Owner or by filing of record in the appropriate office
(with a copy to Owner) a good and sufficient Surrender of this Agreement or a
Partial Surrender describing that portion of the Property as to which this
Agreement is surrendered. Upon mailing the Surrender or Partial Surrender to
Owner or to the appropriate office, all rights of Navigator under this Agreement
with respect to the portion of the Property as to which this Agreement is
terminated (except as provided in paragraphs 24 and 25, entitled "Removal of
Property" and "Access") shall terminate and all liabilities and obligations of
Navigator with respect to the portion of the Property as to which this Agreement
is terminated (except liabilities existing of the date of termination, except as
provided in paragraph 21, entitled "Data", and except liability for payments
under paragraph 7, entitled "Royalty" then due or, in the case of production
royalties, then accrued) shall terminate. Notwithstanding the provisions of this
paragraph, Navigator must retain a minimum of 320 acres of the Property subject
to this Agreement in order to maintain this Agreement in effect.

         24.      REMOVAL of PROPERTY. For a period on six (6) months after the
termination of this Agreement Navigator shall have the right (but not the
obligation) to remove from the Property all broken or stockpiled ore, minerals,
concentrates, or other products (subject to the payment of the royalties
provided for in this Agreement). dumps, tailings, and residue, and all
buildings, structures, machinery, equipment, personal property, fixtures, and
improvements owned by Navigator or erected or placed on or in the Property by
Navigator, except mine timbers in place. Navigator may keep one or more watchmen
on the Property during the six-month period.

         25.      ACCESS. For as long as necessary after termination of this
Agreement, Navigator shall execute one or more instruments granting to Navigator
without costs to Navigator easements upon, over, or through other property owned
by Owner, for the construction, maintenance, use, and removal of pipe lines,
telephone lines, electrical power or transmission lines, roads, railroads,
tramways, flumes, ditches, shafts, drifts, tunnels, and other facilities
necessary or convenient for Navigator's operations on the Property or on other
property

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         26.      EASEMENTS. If requested by Navigator during the term of this
Agreement, Owner shall execute one or more instruments granting to Navigator
without costs to Navigator easements upon, over, or through the Property or
upon, over, or through other property owned by Owner, for the construction,
maintenance use and removal of pipe lines telephone lines, electrical power or
transmission lines, roads, railroads, tramways, flumes, ditches, shafts, drifts,
tunnels, and other facilities necessary or convenient for Navigator's operations
on the Property or on other property.

         27.      NOTICES. All notices and other communications to either party
shall be in writing and shall be sufficiently given if delivered in person or
sent by certified or registered mail, return receipt requested, addressed as
hereinafter set forth. Notices given by mail shall be deemed delivered as of the
date of mailing. Until a change of address is communicated as indicated above,
all notices to Owner shall be addressed:

           Mr. L.E.LAWSON
           16267 Highway #21 North
           Republic, Washington
           99166
and all notices to Navigator shall be addressed:

           Navigator International Minerals
           207-1425 Marine Drive
           West Vancouver, British Columbia
           Canada
           V7T 1B9

         28.      ASSIGNMENT.
(a)      The rights of either party hereunder may be assigned in whole or in
part, subject to the provisions hereinafter set forth.

(b)      No change or division in the ownership of the Property or the payments
provided for herein, however accomplished, shall enlarge the obligations or
diminish the rights of Navigator. Owner covenants that any change in his
ownership shall be accomplished in such a manner that Navigator shall be
required to make payments and to give notices to but one person, firm, or
corporation, and upon breach of this covenant, Navigator may retain all monies
otherwise due to Owner until the breach has been cured. No change or division in
ownership shall be binding on Navigator until thirty (30) days after Owner has
given Navigator a certified copy of the recorded instrument evidencing the
change or division.

(c)      If Owner desires to sell or otherwise dispose of all or any part of his
interest in the Property or in this Agreement, Owner shall first offer the
interest to Navigator stating the interest proposed to be sold or otherwise
disposed of, the offering price (which may

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<PAGE>

include deferred payments), and other terms and conditions of sale. Navigator
may accept the offer by notice to Owner given within sixty (60) days following
the effective date of Owner's offer. If Navigator does not accept Owner's offer,
Owner may sell or otherwise dispose of the interest offered to Navigator at a
price and upon terms and conditions equal to or less favorable to the third
party than those offered to Navigator provided that the sale or other
disposition is effectuated within one hundred and twenty (120) days from the
effective date of Owner's offer.

         29.      FORCE MAJEURE.
(a)      If Navigator shall be prevented by Force Majeure from timely
performance of any of its obligations hereunder (except the payment of money to
Owner), the failure of performance shall be excused and the period for
performance and the term of this Agreement shall be extended for an additional
period equal to the duration of the Force Majeure. Upon the occurrence and upon
the termination of any Force Majeure, Navigator shall promptly notify Owner.
Navigator shall use reasonable diligence to remedy a Force Majeure, but shall
not be required against its better judgment to settle any labor dispute or
contest the validity of any law or regulation or any action or inaction of civil
or military authority.

(b)      "Force Majeure" means any cause beyond Navigator's reasonable control,
including law or regulation; action or inaction of civil or military authority;
inability to obtain any license, permit, or other authorization that may be
required to conduct operations on or in connection with the Property; unusually
severe weather; mining casualty; fire; explosion; flood; insurrection; riot;
labor dispute; inability after diligent effort to obtain workmen or material;
delay in transportation; acts of God; unavailability of a suitable market for
the ores, minerals, concentrates, or other products from the Property; and
excessive costs of mining, milling, processing or marketing, or insufficient
prices available for the ores, minerals, concentrates, or other products
produced from the Property, which render Navigator's operations uneconomic.

         30.      SHORT FORM. Contemporaneously herewith, Navigator and Owner
have executed and delivered a Short Form of Agreement. Navigator may record the
Short Form or this Agreement, or both, as it may elect.

         31.      INUREMENT. All covenants, conditions, limitations, and
provisions therein contained apply to and are binding upon the parties hereto,
their heirs, representatives, successors, and assigns.

         32.      MODIFICATION. No modification, variation, or amendment of this
Agreement shall be effective unless the modification, variation or amendment is
in writing and is signed by Owner and Navigator.

         33.      WAIVER. No waiver of any breach or default under this
Agreement shall be effective unless the waiver is in writing and signed by the
party against whom the waiver is claimed. No waiver of any breach or default
shall be deemed to be a waiver of any other or subsequent breach or default.

                                       13
<PAGE>

         34.      CONSTRUCTION. The paragraph headings are for convenience only,
and shall not be used in the construction of this Agreement. The term "Owner"
shall be deemed to be a singular or plural, and shall be deemed to be masculine
or feminine, or both, or neuter, whenever the construction of this Agreement so
requires.

         35.      GOVERNING LAW. The formation, interpretation, and performance
of this Agreement shall be governed by the law of the Province of British
Columbia.

         36.      INVALIDITY. The invalidity of any provision of this Agreement
shall not affect the enforceability of any other provision of this Agreement.

         37.      COUNTERPARTS. This Agreement may be executed by any number of
counterparts, each of which shall be deemed to be an original.

         38.      ADDITIONAL DOCUMENTS. Owner will provide Navigator with such
additional documents as may be necessary to carry out the purposes of this
Agreement. If conditions change by reason of conveyances, assignments, or other
matters relating to the title to or description of the Property, Owner and
Navigator shall execute amendments of this Agreement and the Short Form of
Agreement, and any other documents which may be necessary to reflect such
changed conditions.

         39.      ENTIRE AGREEMENT. This Agreement sets forth the entire
agreement of the parties and, except as therein expressly provided, supersedes
all previous and contemporaneous agreements, representations, warranties, or
understandings, written or oral.

         IN WITNESS WHEREOF, the parties have executed this Agreement as of the
date first above written.

                               /s/ L. E. Lawson
                               By:
                               L.E. LAWSON
                               Zala M Group Properties

                               /s/ John Reid Anderson
                               By:
                               John Reid Anderson
                               President and Director
                               Navigator International Minerals
                               207-1425 Marine Drive
                               West Vancouver, British Columbia
                               Canada
                               V7T 1B9

                                       14<PAGE>
                                                                    EXHIBIT 4.02

                           ELANTEC SEMICONDUCTOR, INC.

                           2001 EQUITY INCENTIVE PLAN

                           As Adopted November 2, 2000

          1.        PURPOSE. The purpose of this Plan is to provide incentives
to attract, retain and motivate eligible persons whose present and potential
contributions are important to the success of the Company, its Parent and
Subsidiaries, by offering them an opportunity to participate in the Company's
future performance through awards of Options, Restricted Stock and Stock
Bonuses. Capitalized terms not defined in the text are defined in Section 23.

         2.       SHARES SUBJECT TO THE PLAN.

                    2.1       NUMBER OF SHARES AVAILABLE. Subject to Sections
2.2 and 18, the total number of Shares reserved and available for grant and
issuance pursuant to this Plan will be 1,050,000 Shares plus Shares that are
subject to: (a) issuance upon exercise of an Option but cease to be subject to
such Option for any reason other than exercise of such Option; (b) an Award
granted hereunder but are forfeited or are repurchased by the Company at the
original issue price; and (c) an Award that otherwise terminates without Shares
being issued. At all times the Company shall reserve and keep available a
sufficient number of Shares as shall be required to satisfy the requirements of
all outstanding Options granted under this Plan and all other outstanding but
unvested Awards granted under this Plan.

                    2.2       ADJUSTMENT OF SHARES. In the event that the number
of outstanding shares is changed by a stock dividend, recapitalization, stock
split, reverse stock split, subdivision, combination, reclassification or
similar change in the capital structure of the Company without consideration,
then (a) the number of Shares reserved for issuance under this Plan, (b) the
number of Shares that may be granted pursuant to Sections 3 below, (c) the
Exercise Prices of and number of Shares subject to outstanding Options, and (d)
the number of Shares subject to other outstanding Awards will be proportionately
adjusted in compliance with applicable securities laws; PROVIDED, HOWEVER, that
fractions of a Share will not be issued but will either be replaced by a cash
payment equal to the Fair Market Value of such fraction of a Share or will be
rounded up to the nearest whole Share, as determined by the Committee.

          3.        ELIGIBILITY. ISOs (as defined in Section 5 below) may be
granted only to employees (including officers and directors who are also
employees) of the Company or of a Parent or Subsidiary of the Company. All other
Awards may be granted to employees, officers, directors, consultants,
independent contractors and advisors of the Company or any Parent or Subsidiary
of the Company; PROVIDED such consultants, contractors and advisors render bona
fide services not in connection with the offer and sale of securities in a
capital-raising transaction. No person will be eligible to receive more than
200,000 Shares in any calendar year under this Plan pursuant to the grant of
Awards hereunder, other than new employees of the Company or of a Parent or
Subsidiary of the Company (including new employees who are also officers and
directors of the Company or any Parent or Subsidiary of the Company), who are
eligible to receive up to a maximum of 800,000 Shares in the calendar year in
which they commence their employment. A person may be granted more than one
Award under this Plan.

          4.        ADMINISTRATION.

                    4.1       COMMITTEE AUTHORITY. This Plan will be
administered by the Committee or by the Board acting as the Committee. Subject
to the general purposes, terms and conditions of this Plan, and to the direction
of the Board, the Committee will have full power to implement and carry out this
Plan. The Committee will have the authority to:

                    (a)       construe and interpret this Plan, any Award
                              Agreement and any other agreement or document
                              executed pursuant to this Plan;
<PAGE>
                                                     Elantec Semiconductor, Inc.
                                                      2001 Equity Incentive Plan

                    (b)       prescribe, amend and rescind rules and regulations
                              relating to this Plan or any Award;

                    (c)       select persons to receive Awards;

                    (d)       determine the form and terms of Awards;

                    (e)       determine the number of Shares or other
                              consideration subject to Awards;

                    (f)       determine whether Awards will be granted singly,
                              in combination with, in tandem with, in
                              replacement of, or as alternatives to, other
                              Awards under this Plan or any other incentive or
                              compensation plan of the Company or any Parent or
                              Subsidiary of the Company;

                    (g)       grant waivers of Plan or Award conditions;

                    (h)       determine the vesting, exercisability and payment
                              of Awards;

                    (i)       correct any defect, supply any omission or
                              reconcile any inconsistency in this Plan, any
                              Award or any Award Agreement;

                    (j)       determine whether an Award has been earned; and

                    (k)       make all other determinations necessary or
                              advisable for the administration of this Plan.

                    4.2       COMMITTEE DISCRETION. Any determination made by
the Committee with respect to any Award will be made in its sole discretion at
the time of grant of the Award or, unless in contravention of any express term
of this Plan or Award, at any later time, and such determination will be final
and binding on the Company and on all persons having an interest in any Award
under this Plan. The Committee may delegate to one or more officers of the
Company the authority to grant an Award under this Plan to Participants who are
not Insiders of the Company.

          5.        OPTIONS. The Committee may grant Options to eligible persons
and will determine whether such Options will be Incentive Stock Options within
the meaning of the Code ("ISO") or Nonqualified Stock Options ("NQSOs"), the
number of Shares subject to the Option, the Exercise Price of the Option, the
period during which the Option may be exercised, and all other terms and
conditions of the Option, subject to the following:

                    5.1       FORM OF OPTION GRANT. Each Option granted under
this Plan will be evidenced by an Award Agreement which will expressly identify
the Option as an ISO or an NQSO ("STOCK OPTION AGREEMENT"), and will be in such
form and contain such provisions (which need not be the same for each
Participant) as the Committee may from time to time approve, and which will
comply with and be subject to the terms and conditions of this Plan.

                    5.2       DATE OF GRANT. The date of grant of an Option will
be the date on which the Committee makes the determination to grant such Option,
unless otherwise specified by the Committee. The Stock Option Agreement and a
copy of this Plan will be delivered to the Participant within a reasonable time
after the granting of the Option.

                    5.3       EXERCISE PERIOD. Options may be exercisable within
the times or upon the events determined by the Committee as set forth in the
Stock Option Agreement governing such Option; PROVIDED, HOWEVER, that no Option
will be exercisable after the expiration of ten (10) years from the date the
Option is granted; and PROVIDED FURTHER that no ISO granted to a person who
directly or by attribution owns more than ten percent (10%) of the total
combined voting power of all classes of stock of the Company or of any Parent or
Subsidiary of the Company ("TEN PERCENT STOCKHOLDER") will be exercisable after
the expiration of five (5) years from the date the ISO is granted. The Committee
also may provide for Options to become exercisable at one time or from time to
time, periodically or otherwise, in such number of Shares or percentage of
Shares as the Committee determines.

                                       2
<PAGE>
                                                     Elantec Semiconductor, Inc.
                                                      2001 Equity Incentive Plan

                    5.4       EXERCISE PRICE. The Exercise Price of an Option
will be determined by the Committee when the Option is granted; provided that:
(i) the Exercise Price of an ISO will be not less than 100% of the Fair Market
Value of the Shares on the date of grant; and (ii) the Exercise Price of any ISO
granted to a Ten Percent Stockholder will not be less than 110% of the Fair
Market Value of the Shares on the date of grant. Payment for the Shares
purchased may be made in accordance with Section 8 of this Plan.

                    5.5       METHOD OF EXERCISE. Options may be exercised only
by delivery to the Company of a written stock option exercise agreement (the
"EXERCISE AGREEMENT") in a form approved by the Committee (which need not be the
same for each Participant), stating the number of Shares being purchased, the
restrictions imposed on the Shares purchased under such Exercise Agreement, if
any, and such representations and agreements regarding Participant's investment
intent and access to information and other matters, if any, as may be required
or desirable by the Company to comply with applicable securities laws, together
with payment in full of the Exercise Price for the number of Shares being
purchased.

                    5.6       TERMINATION. Notwithstanding the exercise periods
set forth in the Stock Option Agreement, exercise of an Option will always be
subject to the following:

                    (a)       If the Participant is Terminated for any reason
                              except death or Disability, then the Participant
                              may exercise such Participant's Options only to
                              the extent that such Options would have been
                              exercisable upon the Termination Date no later
                              than three (3) months after the Termination Date
                              (or such shorter or longer time period not
                              exceeding five (5) years as may be determined by
                              the Committee, with any exercise beyond three (3)
                              months after the Termination Date deemed to be an
                              NQSO), but in any event, no later than the
                              expiration date of the Options.

                    (b)       If the Participant is Terminated because of
                              Participant's death or Disability (or the
                              Participant dies within three (3) months after a
                              Termination other than for Cause or because of
                              Participant's Disability), then Participant's
                              Options may be exercised only to the extent that
                              such Options would have been exercisable by
                              Participant on the Termination Date and must be
                              exercised by Participant (or Participant's legal
                              representative or authorized assignee) no later
                              than twelve (12) months after the Termination Date
                              (or such shorter or longer time period not
                              exceeding five (5) years as may be determined by
                              the Committee, with any such exercise beyond (a)
                              three (3) months after the Termination Date when
                              the Termination is for any reason other than the
                              Participant's death or disability, within the
                              meaning of Section 22(e)(3) of the Code, or (ii)
                              twelve (12) months after the Termination Date when
                              the Termination is for Participant's disability,
                              within the meaning of Section 22(e)(3) of the
                              Code, deemed to be an NQSO), but in any event no
                              later than the expiration date of the Options.

                    (c)       If the Participant is terminated for Cause, then
                              Participant's Options shall expire on such
                              Participant's Termination Date, or at such later
                              time and on such conditions as are determined by
                              the Committee.

                    5.7       LIMITATIONS ON EXERCISE. The Committee may specify
a reasonable minimum number of Shares that may be purchased on any exercise of
an Option, provided that such minimum number will not prevent Participant from
exercising the Option for the full number of Shares for which it is then
exercisable.

                    5.8       LIMITATIONS ON ISO. The aggregate Fair Market
Value (determined as of the date of grant) of Shares with respect to which ISO
are exercisable for the first time by a Participant during any calendar year
(under this Plan or under any other incentive stock option plan of the Company,
Parent or Subsidiary of the Company) will not exceed $100,000. If the Fair
Market Value of Shares on the date of grant with respect to which ISO are
exercisable for the first time by a Participant during any calendar year exceeds
$100,000, then the Options for the first $100,000 worth of Shares to become
exercisable in such calendar year will be ISO and the Options for the amount in
excess of $100,000 that become exercisable in that calendar year will be NQSOs.
In the event that the

                                       3
<PAGE>
                                                     Elantec Semiconductor, Inc.
                                                      2001 Equity Incentive Plan

Code or the regulations promulgated thereunder are amended after the Effective
Date of this Plan to provide for a different limit on the Fair Market Value of
Shares permitted to be subject to ISO, such different limit will be
automatically incorporated herein and will apply to any Options granted after
the effective date of such amendment.

                    5.9       MODIFICATION, EXTENSION OR RENEWAL. The Committee
may modify, extend or renew outstanding Options and authorize the grant of new
Options in substitution therefor, provided that any such action may not, without
the written consent of a Participant, impair any of such Participant's rights
under any Option previously granted. Any outstanding ISO that is modified,
extended, renewed or otherwise altered will be treated in accordance with
Section 424(h) of the Code. The Committee may reduce the Exercise Price of
outstanding Options without the consent of Participants affected by a written
notice to them; PROVIDED, HOWEVER, that the Exercise Price may not be reduced
below the minimum Exercise Price that would be permitted under Section 5.4 of
this Plan for Options granted on the date the action is taken to reduce the
Exercise Price.

                    5.10      NO DISQUALIFICATION. Notwithstanding any other
provision in this Plan, no term of this Plan relating to ISO will be
interpreted, amended or altered, nor will any discretion or authority granted
under this Plan be exercised, so as to disqualify this Plan under Section 422 of
the Code or, without the consent of the Participant affected, to disqualify any
ISO under Section 422 of the Code.

          6.        RESTRICTED STOCK. A Restricted Stock Award is an offer by
the Company to sell to an eligible person Shares that are subject to
restrictions. The Committee will determine to whom an offer will be made, the
number of Shares the person may purchase, the price to be paid (the "PURCHASE
PRICE"), the restrictions to which the Shares will be subject, and all other
terms and conditions of the Restricted Stock Award, subject to the following:

                    6.1       FORM OF RESTRICTED STOCK AWARD. All purchases
under a Restricted Stock Award made pursuant to this Plan will be evidenced by
an Award Agreement ("RESTRICTED STOCK PURCHASE AGREEMENT") that will be in such
form (which need not be the same for each Participant) as the Committee will
from time to time approve, and will comply with and be subject to the terms and
conditions of this Plan. The offer of Restricted Stock will be accepted by the
Participant's execution and delivery of the Restricted Stock Purchase Agreement
and full payment for the Shares to the Company within thirty (30) days from the
date the Restricted Stock Purchase Agreement is delivered to the person. If such
person does not execute and deliver the Restricted Stock Purchase Agreement
along with full payment for the Shares to the Company within thirty (30) days,
then the offer will terminate, unless otherwise determined by the Committee.

                    6.2       PURCHASE PRICE. The Purchase Price of Shares sold
pursuant to a Restricted Stock Award will be determined by the Committee on the
date the Restricted Stock Award is granted, except in the case of a sale to a
Ten Percent Stockholder, in which case the Purchase Price will be 100% of the
Fair Market Value. Payment of the Purchase Price may be made in accordance with
Section 8 of this Plan.

                    6.3       TERMS OF RESTRICTED STOCK AWARDS. Restricted Stock
Awards shall be subject to such restrictions as the Committee may impose. These
restrictions may be based upon completion of a specified number of years of
service with the Company or upon completion of the performance goals as set out
in advance in the Participant's individual Restricted Stock Purchase Agreement.
Restricted Stock Awards may vary from Participant to Participant and between
groups of Participants. Prior to the grant of a Restricted Stock Award, the
Committee shall: (a) determine the nature, length and starting date of any
Performance Period for the Restricted Stock Award; (b) select from among the
Performance Factors to be used to measure performance goals, if any; and (c)
determine the number of Shares that may be awarded to the Participant. Prior to
the payment of any Restricted Stock Award, the Committee shall determine the
extent to which such Restricted Stock Award has been earned. Performance Periods
may overlap and Participants may participate simultaneously with respect to
Restricted Stock Awards that are subject to different Performance Periods and
having different performance goals and other criteria.

                    6.4       TERMINATION DURING PERFORMANCE PERIOD. If a
Participant is Terminated during a Performance Period for any reason, then such
Participant will be entitled to payment (whether in Shares, cash or otherwise)
with respect to the Restricted Stock Award only to the extent earned as of the
date of Termination in accordance with the Restricted Stock Purchase Agreement,
unless the Committee will determine otherwise.

                                       4
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                                                     Elantec Semiconductor, Inc.
                                                      2001 Equity Incentive Plan

          7.        STOCK BONUSES.

                    7.1       AWARDS OF STOCK BONUSES. A Stock Bonus is an award
of Shares (which may consist of Restricted Stock) for services rendered to the
Company or any Parent or Subsidiary of the Company. A Stock Bonus may be awarded
for past services already rendered to the Company, or any Parent or Subsidiary
of the Company pursuant to an Award Agreement (the "STOCK BONUS AGREEMENT") that
will be in such form (which need not be the same for each Participant) as the
Committee will from time to time approve, and will comply with and be subject to
the terms and conditions of this Plan. A Stock Bonus may be awarded upon
satisfaction of such performance goals as are set out in advance in the
Participant's individual Award Agreement (the "PERFORMANCE STOCK BONUS
AGREEMENT") that will be in such form (which need not be the same for each
Participant) as the Committee will from time to time approve, and will comply
with and be subject to the terms and conditions of this Plan. Stock Bonuses may
vary from Participant to Participant and between groups of Participants, and may
be based upon the achievement of the Company, Parent or Subsidiary and/or
individual performance factors or upon such other criteria as the Committee may
determine.

                    7.2       TERMS OF STOCK BONUSES. The Committee will
determine the number of Shares to be awarded to the Participant. If the Stock
Bonus is being earned upon the satisfaction of performance goals pursuant to a
Performance Stock Bonus Agreement, then the Committee will: (a) determine the
nature, length and starting date of any Performance Period for each Stock Bonus;
(b) select from among the Performance Factors to be used to measure the
performance, if any; and (c) determine the number of Shares that may be awarded
to the Participant. Prior to the payment of any Stock Bonus, the Committee shall
determine the extent to which such Stock Bonuses have been earned. Performance
Periods may overlap and Participants may participate simultaneously with respect
to Stock Bonuses that are subject to different Performance Periods and different
performance goals and other criteria. The number of Shares may be fixed or may
vary in accordance with such performance goals and criteria as may be determined
by the Committee. The Committee may adjust the performance goals applicable to
the Stock Bonuses to take into account changes in law and accounting or tax
rules and to make such adjustments as the Committee deems necessary or
appropriate to reflect the impact of extraordinary or unusual items, events or
circumstances to avoid windfalls or hardships.

                    7.3       FORM OF PAYMENT. The earned portion of a Stock
Bonus may be paid currently or on a deferred basis with such interest or
dividend equivalent, if any, as the Committee may determine. Payment may be made
in the form of cash or whole Shares or a combination thereof, either in a lump
sum payment or in installments, all as the Committee will determine.

          8.        PAYMENT FOR SHARE PURCHASES.

                    8.1       PAYMENT. Payment for Shares purchased pursuant to
this Plan may be made in cash (by check) or, where expressly approved for the
Participant by the Committee and where permitted by law:

                    (a)       by cancellation of indebtedness of the Company to
                              the Participant;

                    (b)       by surrender of shares that either: (1) have been
                              owned by Participant for more than six (6) months
                              and have been paid for within the meaning of SEC
                              Rule 144 (and, if such shares were purchased from
                              the Company by use of a promissory note, such note
                              has been fully paid with respect to such shares);
                              or (2) were obtained by Participant in the public
                              market;

                    (c)       by tender of a full recourse promissory note
                              having such terms as may be approved by the
                              Committee and bearing interest at a rate
                              sufficient to avoid imputation of income under
                              Sections 483 and 1274 of the Code; PROVIDED,
                              HOWEVER, that Participants who are not employees
                              or directors of the Company will not be entitled
                              to purchase Shares with a promissory note unless
                              the note is adequately secured by collateral other
                              than the Shares;

                    (d)       by waiver of compensation due or accrued to the
                              Participant for services rendered;

                                       5
<PAGE>
                                                     Elantec Semiconductor, Inc.
                                                      2001 Equity Incentive Plan

                    (e)       with respect only to purchases upon exercise of an
                              Option, and provided that a public market for the
                              Company's stock exists:

                              (1)       through a "same day sale" commitment
                                        from the Participant and a broker-dealer
                                        that is a member of the National
                                        Association of Securities Dealers (an
                                        "NASD DEALER") whereby the Participant
                                        irrevocably elects to exercise the
                                        Option and to sell a portion of the
                                        Shares so purchased to pay for the
                                        Exercise Price, and whereby the NASD
                                        Dealer irrevocably commits upon receipt
                                        of such Shares to forward the Exercise
                                        Price directly to the Company; or

                              (2)       through a "margin" commitment from the
                                        Participant and a NASD Dealer whereby
                                        the Participant irrevocably elects to
                                        exercise the Option and to pledge the
                                        Shares so purchased to the NASD Dealer
                                        in a margin account as security for a
                                        loan from the NASD Dealer in the amount
                                        of the Exercise Price, and whereby the
                                        NASD Dealer irrevocably commits upon
                                        receipt of such Shares to forward the
                                        Exercise Price directly to the Company;
                                        or

                    (f)       by any combination of the foregoing.

                    8.2       LOAN GUARANTEES. The Committee may help the
Participant pay for Shares purchased under this Plan by authorizing a guarantee
by the Company of a third-party loan to the Participant.

          9.        RESTRICTIONS ON SHARES. At the discretion of the Committee,
the Company may reserve to itself and/or its assignee(s) in the Award Agreement
a right to repurchase a portion of or all Unvested Shares held by a Participant
following such Participant's Termination at any time within ninety (90) days
after the later of Participant's Termination Date and the date Participant
purchases Shares under this Plan, for cash and/or cancellation of purchase money
indebtedness, at the Participant's Exercise Price or Purchase Price, as the case
may be.

          10.       WITHHOLDING TAXES.

                    10.1      WITHHOLDING GENERALLY. Whenever Shares are to be
issued in satisfaction of Awards granted under this Plan, the Company may
require the Participant to remit to the Company an amount sufficient to satisfy
federal, state and local withholding tax requirements prior to the delivery of
any certificate or certificates for such Shares. Whenever, under this Plan,
payments in satisfaction of Awards are to be made in cash, such payment will be
net of an amount sufficient to satisfy federal, state, and local withholding tax
requirements.

                    10.2      STOCK WITHHOLDING. When, under applicable tax
laws, a Participant incurs tax liability in connection with the exercise or
vesting of any Award that is subject to tax withholding and the Participant is
obligated to pay the Company the amount required to be withheld, the Committee
may in its sole discretion allow the Participant to satisfy the minimum
withholding tax obligation by electing to have the Company withhold from the
Shares to be issued that number of Shares having a Fair Market Value equal to
the minimum amount required to be withheld, determined on the date that the
amount of tax to be withheld is to be determined. All elections by a Participant
to have Shares withheld for this purpose will be made in accordance with the
requirements established by the Committee and be in writing in a form acceptable
to the Committee.

          11.       TRANSFERABILITY.

                    11.1      Except as otherwise provided in this Section 11,
Awards granted under this Plan, and any interest therein, will not be
transferable or assignable by Participant, and may not be made subject to
execution, attachment or similar process, otherwise than by will or by the laws
of descent and distribution or as determined by the Committee and set forth in
the Award Agreement with respect to Awards that are not ISOs.

                                       6
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                                                     Elantec Semiconductor, Inc.
                                                      2001 Equity Incentive Plan

                    11.2      ALL AWARDS OTHER THAN NQSO's. All Awards other
than NQSO's shall be exercisable: (i) during the Participant's lifetime, only by
(A) the Participant, or (B) the Participant's guardian or legal representative;
and (ii) after Participant's death, by the legal representative of the
Participant's heirs or legatees.

                    11.3      NQSOs. Unless otherwise restricted by the
Committee, an NQSO shall be exercisable: (i) during the Participant's lifetime
only by (A) the Participant, (B) the Participant's guardian or legal
representative, (C) a Family Member of the Participant who has acquired the NQSO
by "permitted transfer;" and (ii) after Participant's death, by the legal
representative of the Participant's heirs or legatees. "Permitted transfer"
means, as authorized by this Plan and the Committee in an NQSO, any transfer
effected by the Participant during the Participant's lifetime of an interest in
such NQSO but only such transfers which are by gift or domestic relations order.
A permitted transfer does not include any transfer for value and neither of the
following are transfers for value: (a) a transfer of under a domestic relations
order in settlement of marital property rights or (b) a transfer to an entity in
which more than fifty percent of the voting interests are owned by Family
Members or the Participant in exchange for an interest in that entity.

          12.       PRIVILEGES OF STOCK OWNERSHIP.

                    12.1      VOTING AND DIVIDENDS. No Participant will have any
of the rights of a stockholder with respect to any Shares until the Shares are
issued to the Participant. After Shares are issued to the Participant, the
Participant will be a stockholder and have all the rights of a stockholder with
respect to such Shares, including the right to vote and receive all dividends or
other distributions made or paid with respect to such Shares; PROVIDED, that if
such Shares are Restricted Stock, then any new, additional or different
securities the Participant may become entitled to receive with respect to such
Shares by virtue of a stock dividend, stock split or any other change in the
corporate or capital structure of the Company will be subject to the same
restrictions as the Restricted Stock; PROVIDED, FURTHER, that the Participant
will have no right to retain such stock dividends or stock distributions with
respect to Shares that are repurchased at the Participant's Purchase Price or
Exercise Price pursuant to Section 12.

                    12.2      FINANCIAL STATEMENTS. The Company will provide
financial statements to each Participant prior to such Participant's purchase of
Shares under this Plan, and to each Participant annually during the period such
Participant has Awards outstanding; PROVIDED, HOWEVER, the Company will not be
required to provide such financial statements to Participants whose services in
connection with the Company assure them access to equivalent information.

          13.       CERTIFICATES. All certificates for Shares or other
securities delivered under this Plan will be subject to such stock transfer
orders, legends and other restrictions as the Committee may deem necessary or
advisable, including restrictions under any applicable federal, state or foreign
securities law, or any rules, regulations and other requirements of the SEC or
any stock exchange or automated quotation system upon which the Shares may be
listed or quoted.

          14.       ESCROW; PLEDGE OF SHARES. To enforce any restrictions on a
Participant's Shares, the Committee may require the Participant to deposit all
certificates representing Shares, together with stock powers or other
instruments of transfer approved by the Committee, appropriately endorsed in
blank, with the Company or an agent designated by the Company to hold in escrow
until such restrictions have lapsed or terminated, and the Committee may cause a
legend or legends referencing such restrictions to be placed on the
certificates. Any Participant who is permitted to execute a promissory note as
partial or full consideration for the purchase of Shares under this Plan will be
required to pledge and deposit with the Company all or part of the Shares so
purchased as collateral to secure the payment of Participant's obligation to the
Company under the promissory note; PROVIDED, HOWEVER, that the Committee may
require or accept other or additional forms of collateral to secure the payment
of such obligation and, in any event, the Company will have full recourse
against the Participant under the promissory note notwithstanding any pledge of
the Participant's Shares or other collateral. In connection with any pledge of
the Shares, Participant will be required to execute and deliver a written pledge
agreement in such form as the Committee will from time to time approve. The
Shares purchased with the promissory note may be released from the pledge on a
pro rata basis as the promissory note is paid.

                                       7
<PAGE>
                                                     Elantec Semiconductor, Inc.
                                                      2001 Equity Incentive Plan

          15.       EXCHANGE AND BUYOUT OF AWARDS. The Committee may, at any
time or from time to time, authorize the Company, with the consent of the
respective Participants, to issue new Awards in exchange for the surrender and
cancellation of any or all outstanding Awards. The Committee may at any time buy
from a Participant an Award previously granted with payment in cash, Shares
(including Restricted Stock) or other consideration, based on such terms and
conditions as the Committee and the Participant may agree.

          16.       SECURITIES LAW AND OTHER REGULATORY COMPLIANCE. An Award
will not be effective unless such Award is in compliance with all applicable
federal and state securities laws, rules and regulations of any governmental
body, and the requirements of any stock exchange or automated quotation system
upon which the Shares may then be listed or quoted, as they are in effect on the
date of grant of the Award and also on the date of exercise or other issuance.
Notwithstanding any other provision in this Plan, the Company will have no
obligation to issue or deliver certificates for Shares under this Plan prior to:
(a) obtaining any approvals from governmental agencies that the Company
determines are necessary or advisable; and/or (b) completion of any registration
or other qualification of such Shares under any state or federal law or ruling
of any governmental body that the Company determines to be necessary or
advisable. The Company will be under no obligation to register the Shares with
the SEC or to effect compliance with the registration, qualification or listing
requirements of any state securities laws, stock exchange or automated quotation
system, and the Company will have no liability for any inability or failure to
do so.

          17.       NO OBLIGATION TO EMPLOY. Nothing in this Plan or any Award
granted under this Plan will confer or be deemed to confer on any Participant
any right to continue in the employ of, or to continue any other relationship
with, the Company or any Parent or Subsidiary of the Company or limit in any way
the right of the Company or any Parent or Subsidiary of the Company to terminate
Participant's employment or other relationship at any time, with or without
cause.

          18.       CORPORATE TRANSACTIONS.

                    18.1      ASSUMPTION OR REPLACEMENT OF AWARDS BY SUCCESSOR.
In the event of (a) a dissolution or liquidation of the Company, (b) a merger or
consolidation in which the Company is not the surviving corporation (other than
a merger or consolidation with a wholly-owned subsidiary, a reincorporation of
the Company in a different jurisdiction, or other transaction in which there is
no substantial change in the stockholders of the Company or their relative stock
holdings and the Awards granted under this Plan are assumed, converted or
replaced by the successor corporation, which assumption will be binding on all
Participants), (c) a merger in which the Company is the surviving corporation
but after which the stockholders of the Company (other than any stockholder
which merges (or which owns or controls another corporation which merges) with
the Company in such merger) cease to own their shares or other equity interests
in the Company, (d) the sale of substantially all of the assets of the Company,
or (e) any other transaction which qualifies as a "corporate transaction" under
Section 424(a) of the Code wherein the stockholders of the Company give up all
of their equity interest in the Company (EXCEPT for the acquisition, sale or
transfer of all or substantially all of the outstanding shares of the Company
from or by the stockholders of the Company), any or all outstanding Awards may
be assumed, converted or replaced by the successor corporation (if any), which
assumption, conversion or replacement will be binding on all Participants. In
the alternative, the successor corporation may substitute equivalent Awards or
provide substantially similar consideration to Participants as was provided to
stockholders (after taking into account the existing provisions of the Awards).
The successor corporation may also issue, in place of outstanding Shares of the
Company held by the Participant, substantially similar shares or other property
subject to repurchase restrictions no less favorable to the Participant. In the
event such successor corporation (if any) refuses to assume or substitute
Options, as provided above, pursuant to a transaction described in this
Subsection 18.1, such Options will expire on such transaction at such time and
on such conditions as the Board will determine.

                    18.2      OTHER TREATMENT OF AWARDS. Subject to any greater
rights granted to Participants under the foregoing provisions of this Section
18, in the event of the occurrence of any transaction described in Section 18.1,
any outstanding Awards will be treated as provided in the applicable agreement
or plan of merger, consolidation, dissolution, liquidation, sale of assets or
other "corporate transaction."

                                       8
<PAGE>
                                                     Elantec Semiconductor, Inc.
                                                      2001 Equity Incentive Plan

                    18.3      ASSUMPTION OF AWARDS BY THE COMPANY. The Company,
from time to time, also may substitute or assume outstanding awards granted by
another company, whether in connection with an acquisition of such other company
or otherwise, by either: (a) granting an Award under this Plan in substitution
of such other company's award; or (b) assuming such award as if it had been
granted under this Plan if the terms of such assumed award could be applied to
an Award granted under this Plan. Such substitution or assumption will be
permissible if the holder of the substituted or assumed award would have been
eligible to be granted an Award under this Plan if the other company had applied
the rules of this Plan to such grant. In the event the Company assumes an award
granted by another company, the terms and conditions of such award will remain
unchanged (EXCEPT that the exercise price and the number and nature of Shares
issuable upon exercise of any such option will be adjusted appropriately
pursuant to Section 424(a) of the Code). In the event the Company elects to
grant a new Option rather than assuming an existing option, such new Option may
be granted with a similarly adjusted Exercise Price.

          19.       ADOPTION AND STOCKHOLDER APPROVAL. This Plan will become
effective on the date this Plan is adopted by the Board (the "EFFECTIVE DATE").
This Plan shall be approved by the stockholders of the Company (excluding Shares
issued pursuant to this Plan), consistent with applicable laws, within twelve
(12) months before or after the date this Plan is adopted by the Board. Upon the
Effective Date, the Committee may grant Awards pursuant to this Plan; PROVIDED,
HOWEVER, that: (a) no Option may be exercised prior to initial stockholder
approval of this Plan; (b) no Option granted pursuant to an increase in the
number of Shares subject to this Plan approved by the Board will be exercised
prior to the time such increase has been approved by the stockholders of the
Company; (c) in the event that initial stockholder approval is not obtained
within the time period provided herein, all Awards granted hereunder shall be
cancelled, any Shares issued pursuant to any Awards shall be cancelled and any
purchase of Shares issued hereunder shall be rescinded; and (d) in the event
that stockholder approval of such increase is not obtained within the time
period provided herein, all Awards granted pursuant to such increase will be
cancelled, any Shares issued pursuant to any Award granted pursuant to such
increase will be cancelled, and any purchase of Shares pursuant to such increase
will be rescinded.

          20.       TERM OF PLAN/GOVERNING LAW. Unless earlier terminated as
provided herein, this Plan will terminate ten (10) years from the date this Plan
is adopted by the Board or, if earlier, the date of stockholder approval. This
Plan and all agreements thereunder shall be governed by and construed in
accordance with the laws of the State of California.

          21.       AMENDMENT OR TERMINATION OF PLAN. The Board may at any time
terminate or amend this Plan in any respect, including without limitation
amendment of any form of Award Agreement or instrument to be executed pursuant
to this Plan; PROVIDED, HOWEVER, that the Board will not, without the approval
of the stockholders of the Company, amend this Plan in any manner that requires
such stockholder approval.

          22.       NONEXCLUSIVITY OF THE PLAN. Neither the adoption of this
Plan by the Board, the submission of this Plan to the stockholders of the
Company for approval, nor any provision of this Plan will be construed as
creating any limitations on the power of the Board to adopt such additional
compensation arrangements as it may deem desirable, including, without
limitation, the granting of stock options and bonuses otherwise than under this
Plan, and such arrangements may be either generally applicable or applicable
only in specific cases.

          23.       DEFINITIONS. As used in this Plan, the following terms will
have the following meanings:

                    "AWARD" means any award under this Plan, including any
Option, Restricted Stock or Stock Bonus.

                    "AWARD AGREEMENT" means, with respect to each Award, the
signed written agreement between the Company and the Participant setting forth
the terms and conditions of the Award.

                    "BOARD" means the Board of Directors of the Company.

                    "CAUSE" means (i) the commission of an act of theft,
embezzlement, fraud, dishonesty, (b) a breach of fiduciary duty to the Company
or a Parent or Subsidiary of the Company or (c) a failure to materially perform
the customary duties of employee's employment.

                                       9
<PAGE>
                                                     Elantec Semiconductor, Inc.
                                                      2001 Equity Incentive Plan

                    "CODE" means the Internal Revenue Code of 1986, as amended.

                    "COMMITTEE" means the Compensation Committee of the Board.

                    "COMPANY" means Elantec Semiconductor, Inc. or any successor
corporation.

                    "DISABILITY" means a disability, whether temporary or
permanent, partial or total, as determined by the Committee.

                    "EXCHANGE ACT" means the Securities Exchange Act of 1934, as
amended.

                    "EXERCISE PRICE" means the price at which a holder of an
Option may purchase the Shares issuable upon exercise of the Option.

                    "FAIR MARKET VALUE" means, as of any date, the value of a
share of the Company's Common Stock determined as follows:

                    (a)       if such Common Stock is then quoted on the Nasdaq
                              National Market, its closing price on the Nasdaq
                              National Market on the date of determination as
                              reported in THE WALL STREET JOURNAL;

                    (b)       if such Common Stock is publicly traded and is
                              then listed on a national securities exchange, its
                              closing price on the date of determination on the
                              principal national securities exchange on which
                              the Common Stock is listed or admitted to trading
                              as reported in THE WALL STREET JOURNAL;

                    (c)       if such Common Stock is publicly traded but is not
                              quoted on the Nasdaq National Market nor listed or
                              admitted to trading on a national securities
                              exchange, the average of the closing bid and asked
                              prices on the date of determination as reported in
                              THE WALL STREET JOURNAL;

                    (d)       in the case of an Award made on the Effective
                              Date, the price per share at which shares of the
                              Company's Common Stock are initially offered for
                              sale to the public by the Company's underwriters
                              in the initial public offering of the Company's
                              Common Stock pursuant to a registration statement
                              filed with the SEC under the Securities Act; or

                    (e)       if none of the foregoing is applicable, by the
                              Committee in good faith.

                    "FAMILY MEMBER" includes any of the following:

                    (a)       child, stepchild, grandchild, parent, stepparent,
                              grandparent, spouse, former spouse, sibling,
                              niece, nephew, mother-in-law, father-in-law,
                              son-in-law, daughter-in-law, brother-in-law, or
                              sister-in-law of the Participant, including any
                              such person with such relationship to the
                              Participant by adoption;

                    (b)       any person (other than a tenant or employee)
                              sharing the Participant's household;

                    (c)       a trust in which the persons in (a) and (b) have
                              more than fifty percent of the beneficial
                              interest;

                    (d)       a foundation in which the persons in (a) and (b)
                              or the Participant control the management of
                              assets; or

                                       10
<PAGE>
                                                     Elantec Semiconductor, Inc.
                                                      2001 Equity Incentive Plan

                    (e)       any other entity in which the persons in (a) and
                              (b) or the Participant own more than fifty percent
                              of the voting interest.

                    "INSIDER" means an officer or director of the Company or any
other person whose transactions in the Company's Common Stock are subject to
Section 16 of the Exchange Act.

                    "OPTION" means an award of an option to purchase Shares
pursuant to Section 5.

                    "PARENT" means any corporation (other than the Company) in
an unbroken chain of corporations ending with the Company if each of such
corporations other than the Company owns stock possessing 50% or more of the
total combined voting power of all classes of stock in one of the other
corporations in such chain.

                    "PARTICIPANT" means a person who receives an Award under
this Plan.

                    "PERFORMANCE FACTORS" means the factors selected by the
Committee from among the following measures to determine whether the performance
goals established by the Committee and applicable to Awards have been satisfied:

                    (a)       Net revenue and/or net revenue growth;

                    (b)       Earnings before income taxes and amortization
                              and/or earnings before income taxes and
                              amortization growth;

                    (c)       Operating income and/or operating income growth;

                    (d)       Net income and/or net income growth;

                    (e)       Earnings per share and/or earnings per share
                              growth;

                    (f)       Total stockholder return and/or total stockholder
                              return growth;

                    (g)       Return on equity;

                    (h)       Operating cash flow return on income;

                    (i)       Adjusted operating cash flow return on income;

                    (j)       Economic value added; and

                    (k)       Individual confidential business objectives.

                    "PERFORMANCE PERIOD" means the period of service determined
by the Committee, not to exceed five years, during which years of service or
performance is to be measured for Restricted Stock Awards or Stock Bonuses.

                    "PLAN" means this Elantec Semiconductor, Inc. 2001 Equity
Incentive Plan, as amended from time to time.

                    "RESTRICTED STOCK AWARD" means an award of Shares pursuant
to Section 6.

                    "SEC" means the Securities and Exchange Commission.

                    "SECURITIES ACT" means the Securities Act of 1933, as
amended.

                                       11
<PAGE>
                                                     Elantec Semiconductor, Inc.
                                                      2001 Equity Incentive Plan

                    "SHARES" means shares of the Company's Common Stock reserved
for issuance under this Plan, as adjusted pursuant to Sections 2 and 18, and any
successor security.

                    "STOCK BONUS" means an award of Shares, or cash in lieu of
Shares, pursuant to Section 7.

                    "SUBSIDIARY" means any corporation (other than the Company)
in an unbroken chain of corporations beginning with the Company if each of the
corporations other than the last corporation in the unbroken chain owns stock
possessing 50% or more of the total combined voting power of all classes of
stock in one of the other corporations in such chain.

                    "TERMINATION" or "TERMINATED" means, for purposes of this
Plan with respect to a Participant, that the Participant has for any reason
ceased to provide services as an employee, officer, director, consultant,
independent contractor, or advisor to the Company or a Parent or Subsidiary of
the Company. An employee will not be deemed to have ceased to provide services
in the case of (i) sick leave, (ii) military leave, or (iii) any other leave of
absence approved by the Committee, provided, that such leave is for a period of
not more than 90 days, unless reemployment upon the expiration of such leave is
guaranteed by contract or statute or unless provided otherwise pursuant to
formal policy adopted from time to time by the Company and issued and
promulgated to employees in writing. In the case of any employee on an approved
leave of absence, the Committee may make such provisions respecting suspension
of vesting of the Award while on leave from the employ of the Company or a
Subsidiary as it may deem appropriate, except that in no event may an Option be
exercised after the expiration of the term set forth in the Option agreement.
The Committee will have sole discretion to determine whether a Participant has
ceased to provide services and the effective date on which the Participant
ceased to provide services (the "TERMINATION DATE").

                    "UNVESTED SHARES" means "Unvested Shares" as defined in the
Award Agreement.

                    "VESTED SHARES" means "Vested Shares" as defined in the
Award Agreement.

                                       12

<PAGE>

                           ELANTEC SEMICONDUCTOR, INC.

                           2001 EQUITY INCENTIVE PLAN

                             STOCK OPTION AGREEMENT

          This Stock Option Agreement (this "Agreement") is made and entered
into as of the date of grant set forth in the Notice of Grant of Stock
Options and Option Agreement (the "Date of Grant") by and between Elantec
Semiconductor, Inc., a Delaware corporation (the "Company"), and the
participant named in the Notice of Grant of Stock Options and Option
Agreement ("Participant"). Capitalized terms not defined herein shall have
the meaning ascribed to them in the Company's 2001 Equity Incentive Plan, as
amended (the "Plan").

          1.        GRANT OF OPTION. The Company hereby grants to Participant an
option (this "Option") to purchase up to the total number of shares of Common
Stock, par value $0.01 of the Company set forth above (collectively, the
"Shares") at the Exercise Price Per Share set forth above (the "Exercise
Price"), subject to all of the terms and conditions of this Agreement and the
Plan. If designated as an Incentive Stock Option above, this Option is intended
to qualify as an "incentive stock option" ("ISO") within the meaning of Section
422 of the Internal Revenue Code of 1986, as amended (the "Code").

          2.        VESTING; EXERCISE PERIOD.

                    2.1       VESTING; EXERCISE PERIOD OF OPTION. (a) Provided
Participant continues to provide services to the Company or any Subsidiary,
Parent or Affiliate of the Company throughout the specified period, the Option
shall become exercisable with respect to twenty-five percent (25%) of the Shares
at the end of each full succeeding year after the Vesting Start Date set forth
above (the "Vesting Start Date"); (b) if Participant has continuously provided
services to the Company or any Subsidiary, Parent or Affiliate of the Company
from the Date of Grant through the First Vesting Date and has not been
Terminated on or before the First Vesting Date, then on the First Vesting Date
this Option shall become exercisable as to twenty-five percent (25%) of the
Shares on the first anniversary of the date of hire for new employees and on the
first anniversary of the date of grant for existing employees and 1/48th of the
total number of shares on a monthly basis thereafter; PROVIDED that this Option
shall in no event ever become exercisable with respect to more than 100% of the
Shares.

                    2.2       EXPIRATION. This Option shall expire on the
Expiration Date and must be exercised, if at all, on or before the earlier of
the Expiration Date or the date on which this Option is earlier terminated in
accordance with the provisions of Section 3.

          3.        TERMINATION.

                    3.1       TERMINATION FOR ANY REASON EXCEPT DEATH OR
DISABILITY. If Participant is Terminated for any reason, except Participant's
death or Disability, then this Option, to the extent (and only to the extent)
that it would have been exercisable by Participant on the Termination Date, may
be exercised by Participant no later than three (3) months after the Termination
Date, but in any event no later than the Expiration Date.

                    3.2       TERMINATION BECAUSE OF DEATH OR DISABILITY. If
Participant is Terminated because of death or Disability of Participant (or
Participant dies within three (3) months after Termination other than because of
Participant's death or disability), then this Option, to the extent that it is
exercisable by Participant on the Termination Date, may be exercised by
Participant (or Participant's legal representative) no later than twelve (12)
months after the Termination Date, but in any event no later than the Expiration
Date. Any exercise beyond (a) three (3) months after the Termination Date when
the Termination is for any reason other than the Participant's death or
Disability, or (b) twelve (12) months after the Termination Date when the
Termination is for Participant's death or Disability, deemed to be an
nonqualified stock option.

                    3.3       NO OBLIGATION TO EMPLOY. Nothing in the Plan or
this Agreement shall confer on Participant any right to continue in the employ
of, or other relationship with, the Company or any Parent, Subsidiary or
Affiliate of the Company, or limit in any way the right of the Company or any
Parent, Subsidiary or Affiliate of the Company to terminate Participant's
employment or other relationship at any time, with or without cause.

                                       1
<PAGE>

          4.        MANNER OF EXERCISE.

                    4.1       STOCK OPTION EXERCISE AGREEMENT. To exercise this
Option, Participant (or in the case of exercise after Participant's death,
Participant's executor, administrator, heir or legatee, as the case may be) must
deliver to the Company an executed stock option exercise agreement in the form
attached hereto as EXHIBIT A, or in such other form as may be approved by the
Company from time to time (the "Exercise Agreement"), which shall set forth,
INTER ALIA, Participant's election to exercise this Option, the number of Shares
being purchased, any restrictions imposed on the Shares and any representations,
warranties and agreements regarding Participant's investment intent and access
to information as may be required by the Company to comply with applicable
securities laws. If someone other than Participant exercises this Option, then
such person must submit documentation reasonably acceptable to the Company that
such person has the right to exercise this Option.

                    4.2       LIMITATIONS ON EXERCISE. This Option may not be
exercised unless such exercise is in compliance with all applicable federal and
state securities laws, as they are in effect on the date of exercise. This
Option may not be exercised as to fewer than 100 Shares unless it is exercised
as to all Shares as to which this Option is then exercisable.

                    4.3       PAYMENT. The Exercise Agreement shall be
accompanied by full payment of the Exercise Price for the Shares being purchased
in cash (by check), or where permitted by law:

     (a)       by cancellation of indebtedness of the Company to the
               Participant;

     (b)       by surrender of shares of the Company's Common Stock that
               either: (1) have been owned by Participant for more than six
               (6) months and have been paid for within the meaning of SEC
               Rule 144 (and, if such shares were purchased from the
               Company by use of a promissory note, such note has been
               fully paid with respect to such shares); or (2) were
               obtained by Participant in the open public market; AND (3)
               are clear of all liens, claims, encumbrances or security
               interests;

     (c)       by tender of a full recourse promissory note having such
               terms as may be approved by the Committee and bearing
               interest at a rate sufficient to avoid imputation of income
               under Sections 483 and 1274 of the Code; PROVIDED, HOWEVER,
               that Participants who are not employees or directors of the
               Company shall not be entitled to purchase Shares with a
               promissory note unless the note is adequately secured by
               collateral other than the Shares; and PROVIDED, FURTHER,
               that the portion of the Exercise Price equal to the par
               value of the Shares must be paid in cash;

     (d)       by waiver of compensation due or accrued to Participant for
               services rendered; PROVIDED that the portion of the Exercise
               Price equal to the par value of the Shares must be paid in
               cash;

     (e)       by tender of property;

     (f)       provided that a public market for the Company's stock
               exists: (1) through a "same day sale" commitment from
               Participant and a broker-dealer that is a member of the
               National Association of Securities Dealers (an "NASD
               Dealer") whereby Participant irrevocably elects to exercise
               this Option and to sell a portion of the Shares so purchased
               to pay for the exercise price and whereby the NASD Dealer
               irrevocably commits upon receipt of such Shares to forward
               the exercise price directly to the Company; OR (2) through a
               "margin" commitment from Participant and a NASD Dealer
               whereby Participant irrevocably elects to exercise this
               Option and to pledge the Shares so purchased to the NASD
               Dealer in a margin account as security for a loan from the
               NASD Dealer in the amount of the exercise price, and whereby
               the NASD Dealer irrevocably commits upon receipt of such
               Shares to forward the exercise price directly to the
               Company; or

     (g)       by any combination of the foregoing.

                    4.4       TAX WITHHOLDING. Prior to the issuance of the
Shares upon exercise of this Option, Participant must pay or provide for any
applicable federal or state withholding obligations of the Company. If the

                                       2
<PAGE>

Committee permits, Participant may provide for payment of withholding taxes upon
exercise of this Option by requesting that the Company retain Shares with a Fair
Market Value equal to the minimum amount of taxes required to be withheld. In
such case, the Company shall issue the net number of Shares to the Participant
by deducting the Shares retained from the Shares issuable upon exercise.

                    4.5       ISSUANCE OF SHARES. Provided that the Exercise
Agreement and payment are in form and substance satisfactory to counsel for the
Company, the Company shall issue the Shares registered in the name of
Participant, Participant's authorized assignee, or Participant's legal
representative, and shall deliver certificates representing the Shares with the
appropriate legends affixed thereto.

          5.        NOTICE OF DISQUALIFYING DISPOSITION OF ISO SHARES. If this
Option is an ISO, and if Participant sells or otherwise disposes of any of the
Shares acquired pursuant to the ISO on or before the later of (a) the date two
(2) years after the Date of Grant, and (b) the date one (1) year after transfer
of such Shares to Participant upon exercise of this Option, then Participant
shall immediately notify the Company in writing of such disposition. Participant
agrees that Participant may be subject to income tax withholding by the Company
on the compensation income recognized by Participant from the early disposition
by payment in cash or out of the current wages or other compensation payable to
Participant.

          6.        COMPLIANCE WITH LAWS AND REGULATIONS. The exercise of this
Option and the issuance and transfer of Shares shall be subject to compliance by
the Company and Participant with all applicable requirements of federal and
state securities laws and with all applicable requirements of any stock exchange
on which the Company's Common Stock may be listed at the time of such issuance
or transfer. Participant understands that the Company is under no obligation to
register or qualify the Shares with the Securities and Exchange Commission, any
state securities commission or any stock exchange to effect such compliance.

          7.        NONTRANSFERABILITY OF OPTION. This Option may not be
transferred in any manner other than by will or by the laws of descent and
distribution and may be exercised during the lifetime of Participant only by
Participant. The terms of this Option shall be binding upon the executors,
administrators, successors and assigns of Participant.

          8.        TAX CONSEQUENCES. Set forth below is a brief summary as of
the Date of Grant of some of the federal and California tax consequences of
exercise of this Option and disposition of the Shares. THIS SUMMARY IS
NECESSARILY INCOMPLETE, AND THE TAX LAWS AND REGULATIONS ARE SUBJECT TO CHANGE.
PARTICIPANT SHOULD CONSULT A TAX ADVISOR BEFORE EXERCISING THE OPTION OR
DISPOSING OF THE SHARES.

                    8.1       EXERCISE OF ISO. If this Option qualifies as an
ISO, there will be no regular federal or California income tax liability upon
the exercise of this Option, although the excess, if any, of the fair market
value of the Shares on the date of exercise over the Exercise Price will be
treated as a tax preference item for federal income tax purposes and may subject
the Participant to the alternative minimum tax in the year of exercise.

                    8.2       EXERCISE OF NONQUALIFIED STOCK OPTION. If this
Option does not qualify as an ISO, there may be a regular federal and California
income tax liability upon the exercise of this Option. Participant will be
treated as having received compensation income (taxable at ordinary income tax
rates) equal to the excess, if any, of the fair market value of the Shares on
the date of exercise over the Exercise Price. The Company will be required to
withhold from Participant's compensation or collect from Participant and pay to
the applicable taxing authorities an amount equal to a percentage of this
compensation income at the time of exercise.

                    8.3       DISPOSITION OF SHARES. If the Shares are held for
more than twelve (12) months after the date of the transfer of the Shares
pursuant to the exercise of this Option (and, in the case of an ISO, are
disposed of more than two (2) years after the Date of Grant), then any gain
realized on disposition of the Shares will be treated as long term capital gain
for federal and California income tax purposes. If Shares purchased under an ISO
are disposed of within one (1) year of exercise or within two (2) years after
the Date of Grant, then any gain realized on such disposition will be treated as
compensation income (taxable at ordinary income rates) to the extent of the
excess, if any, of the fair market value of the Shares on the date of exercise
over the Exercise Price. The

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<PAGE>

Company will be required to withhold from Participant's compensation or collect
from Participant and pay to the applicable taxing authorities an amount equal to
a percentage of this compensation income at the time of exercise.

          9.        PRIVILEGES OF STOCK OWNERSHIP. Participant shall not have
any of the rights of a stockholder with respect to any Shares until Participant
exercises this Option and pays the Exercise Price.

          10.       INTERPRETATION. Any dispute regarding the interpretation of
this Agreement shall be submitted by Participant or the Company to the Committee
for review. The resolution of such a dispute by the Committee shall be final and
binding on the Company and Participant.

          11.       ENTIRE AGREEMENT. The Plan is incorporated herein by
reference. This Agreement and the Plan and the Exercise Agreement constitute the
entire agreement and understanding of the parties hereto with respect to the
subject matter hereof and supersede all prior understandings and agreements with
respect to such subject matter.

          12.       NOTICES. Any notice required to be given or delivered to the
Company under the terms of this Agreement shall be in writing and addressed to
the Corporate Secretary of the Company at its principal corporate offices. Any
notice required to be given or delivered to Participant shall be in writing and
addressed to Participant at the address indicated above or to such other address
as such party may designate in writing from time to time to the Company. All
notices shall be deemed to have been given or delivered upon: personal delivery;
three (3) days after deposit in the United States mail by certified or
registered mail (return receipt requested); one (1) business day after deposit
with any return receipt express courier (prepaid); or one (1) business day after
transmission by rapifax or telecopier.

          13.       SUCCESSORS AND ASSIGNS. The Company may assign any of its
rights under this Agreement. This Agreement shall be binding upon and inure to
the benefit of the successors and assigns of the Company. Subject to the
restrictions on transfer set forth herein, this Agreement shall be binding upon
Participant and Participant's heirs, executors, administrators, legal
representatives, successors and assigns.

          14.       GOVERNING LAW. This Agreement shall be governed by and
construed in accordance with the internal laws of the State of Delaware, without
regard to that body of law pertaining to choice of law or conflict of law.

          15.       ACCEPTANCE. Participant hereby acknowledges receipt of a
copy of the Plan and this Agreement. Participant has read and understands the
terms and provisions thereof, and accepts this Option subject to all the terms
and conditions of the Plan and this Agreement. Participant acknowledges that
there may be adverse tax consequences upon exercise of this Option or
disposition of the Shares and that the Company has advised Participant to
consult a tax advisor prior to such exercise or disposition.

          IN WITNESS WHEREOF, the Company has caused this Agreement to be
executed in duplicate by its duly authorized representative and Participant has
executed this Agreement in duplicate as of the Date of Grant.

ELANTEC SEMICONDUCTOR, INC.                     OPTIONEE

By:____________________________________         By:_____________________________
     Richard M. Beyer                              Signature
     President & Chief Executive Officer
                                                ________________________________
                                                Print Name

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                                    EXHIBIT A

                         STOCK OPTION EXERCISE AGREEMENT

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