Document:

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                             ARCADIA FINANCIAL LTD.
                             1990 STOCK OPTION PLAN
                          (AS AMENDED MARCH 16, 2000)

1. PURPOSE

    The purpose of this 1990 Stock Option Plan (the "Plan") is to promote the
interests of Arcadia Financial Ltd., a Minnesota corporation (the "Company"), by
providing employees of the Company and certain independent contractors with an
opportunity to acquire a proprietary interest in the Company, and thereby
develop a stronger incentive to contribute to the Company's continued success
and growth. In addition, the opportunity to acquire a proprietary interest in
the Company by the offering and availability of stock options will assist the
Company in attracting and retaining key personnel and consultants of outstanding
ability.

2. DEFINITIONS

    Wherever used in the Plan, the following terms have the meanings set forth
below:

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

    2.2    "Code" means the Internal Revenue Code of 1986, as amended, and the
rules and regulations promulgated thereunder.

    2.3    "Committee" means the Committee which may be designated from time to
time by the Board to administer the Plan pursuant to Section 3.5.

    2.4    "Incentive Stock Option" or "ISO" means a stock option which is
intended to qualify as an incentive stock option as defined in Section 422A of
the Code.

    2.5    "Non-Statutory Stock Option" or "NSO" means a stock option that is
not intended to, or does not, qualify as an incentive stock option as defined in
Section 422A of the Code.

    2.6    "Option" means, where required by the context of the Plan, an ISO
and/or NSO granted pursuant to the Plan.

    2.7    "Optionee" means a Participant in the Plan who has been granted one
or more Options under the Plan.

    2.8    "Participant" means an individual described in Section 5 of this Plan
who may be granted Options under the Plan.

    2.9    "Stock" means the Common Stock, $.01 par value, of the Company.

    2.10   "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 50% or
more of the voting stock in one of the other corporations in such chain.

3. ADMINISTRATION

    3.1    The Plan shall be administered by the Board, which shall have full
power, subject to the provisions of the Plan, to grant Options, construe and
interpret the Plan, establish rules and regulations with respect to the Plan and
Options granted hereunder, and perform all other acts, including the delegation
of administrative responsibilities, that it believes reasonable and necessary.

    3.2    The Board shall have the sole discretion, subject to the provisions
of the Plan, to determine the Participants eligible to receive Options pursuant
to the Plan and the amount, type, and terms of any Options and the terms and
conditions of option agreements relating to any Option.

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    3.3    The Board may correct any defect, supply any omission, or reconcile
any inconsistency in the Plan or in any Option granted hereunder in the manner
and to the extent it shall deem necessary to carry out the terms of the Plan.

    3.4    Any decision made, or action taken, by the Board arising out of or in
connection with the interpretation and administration of the Plan shall be
final, conclusive and binding upon all Optionees.

    3.5    The Board may designate a Committee from time to time to administer
the Plan. If designated, the Committee shall be composed of not less than two
persons (who need not be members of the Board) who are appointed from time to
time by the Board. If the Board has appointed a Committee pursuant to this
Section 3.5 of the Plan, then the Committee may administer the Plan and exercise
all of the rights and powers granted to the Board in this Plan, including,
without limitation, the right to grant Options pursuant to the Plan and to
establish the Option price as provided in the Plan.

4. SHARES SUBJECT TO THE PLAN

    4.1    The total number of shares of Stock reserved for issuance upon
exercise of Options under the Plan is 5,000,000. Such shares shall consist of
authorized but unissued Stock. If any Option granted under the Plan lapses or
terminates for any reason before being completely exercised, the shares covered
by the unexercised portion of such Option may again be made subject to Options
under the Plan.

    4.2    CHANGES IN CAPITALIZATION.  In the event of any change in the
outstanding shares of Stock of the Company by reason of any stock dividend,
split, recapitalization, reorganization, merger, consolidation, combination,
exchange of shares, or rights offering to purchase stock at a price
substantially below fair market value, or other similar corporate change, the
aggregate number of shares which may be subject to Options under the Plan and
the terms of any outstanding Option, including the number and kind of shares
subject to such Options and the purchase price per share thereof, shall be
appropriately adjusted by the Board, consistent with such change and in such
manner as the Board, in its sole discretion, may deem equitable to prevent
substantial dilution or enlargement of the rights granted to or available for
Optionees. Notwithstanding the preceding sentence, in no event shall any
fraction of a share of Stock be issued upon the exercise of an Option.

    4.3    AWARD LIMITATIONS UNDER THE PLAN.  No eligible participant, who is an
employee of the Company at the time of grant, may be granted any Option or
Options, the value of which Options are based solely on an increase in the value
of the Shares after the date of grant of such Options for more than 1,500,000
shares (subject to adjustment as provided for in Section 4.2 relating to stock
splits, etc.), in the aggregate, in any one calendar year period beginning with
the period commencing January 1, 1997 and ending December 31, 1997. The
foregoing annual limitation specifically includes the grant of any Options
representing "qualified performance based compensation" within the meaning of
Section 162(m) of the Code.

5. ELIGIBLE PARTICIPANTS

    The following persons are Participants eligible to participate in the Plan:

    5.1    INCENTIVE STOCK OPTIONS.  Incentive Stock Options may be granted only
to employees of the Company or any Subsidiary, including officers and directors
who are also employees of the Company or any Subsidiary.

    5.2    NON-STATUTORY STOCK OPTIONS.  Non-statutory stock options may be
granted to (i) any employee of the Company or any Subsidiary, including any
officer or director who is also an employee of the Company or any Subsidiary;
and (ii) any consultant to, or other independent contractor of, the Company.

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6. GRANT OF OPTIONS

    Subject to the terms, conditions, and limitations set forth in this Plan,
the Company, by action of its Board, may from time to time grant Options to
purchase shares of the Company's Stock to those eligible Participants as may be
selected by the Board, in such amounts and on such other terms as the Board in
its sole discretion shall determine. Such Options may be (i) "Incentive Stock
Options" so designated by the Board and which, when granted, are intended to
qualify as incentive stock options as defined in Section 422A of the Code; (ii)
"Non-Statutory Stock Options" so designated by the Board and which, when
granted, are not intended to, or do not, qualify as incentive stock options
under Section 422A of the Code; or (iii) a combination of both. The date on
which the Board approves the granting of an Option shall be the date of grant of
such Option, unless a different date is specified by the Board on such date of
approval. Notwithstanding the foregoing, with respect to the grant of any
Incentive Stock Option under the Plan, the aggregate fair market value of Stock
(determined as of the date the Option is granted) with respect to which
incentive stock options are exercisable for the first time by an Optionee in any
calendar year (under all such stock option plans of the Company or Subsidiaries)
shall not exceed $100,000. Each grant of an Option under the Plan shall be
evidenced by a written stock option agreement between the Company and the
Optionee setting forth the terms and conditions, not inconsistent with the Plan,
under which the Option so granted may be exercised pursuant to the Plan and
containing such other terms with respect to the Option as the Board in its sole
discretion may determine.

7. OPTION PRICE AND FORM OF PAYMENT

    7.1    INCENTIVE STOCK OPTIONS.  The purchase price for a share of Stock
subject to an Incentive Stock Option granted hereunder shall not be less than
100% of the fair market value of the Stock. Notwithstanding the foregoing, in
the case of an Incentive Stock Option granted to any Optionee then owning more
than 10% of the voting power of all classes of the Company's stock, the purchase
price per share of the Stock subject to such Option shall not be less than 110%
of the fair market value of the Stock on the date of grant of the Incentive
Stock Option, determined as provided in Section 7.3.

    7.2    NON-STATUTORY STOCK OPTIONS.  The purchase price for a share of Stock
subject to a non-statutory stock Option shall be not less than the lesser of
(a) 100% of the fair market value of the Stock on the date of grant or (b) the
greater of (i) 85% of the fair market value of the Stock on the date of grant
and (ii) $6.00 per share.

    7.3    DETERMINATION OF FAIR MARKET VALUE.  For purposes of this Section 7,
the "fair market value" of the Stock shall be determined as follows:

        (a) if the Stock of the Company is listed or admitted to unlisted
    trading privileges on a national securities exchange, the fair market value
    on any given day shall be the closing sale price for the Stock, or if no
    sale is made on such day, the closing bid price for such day on such
    exchange;

        (b) if the Stock is not listed or admitted to unlisted trading
    privileges on a national securities exchange, the fair market value on any
    given day shall be the closing sale price for the Stock as reported on the
    NASDAQ National Market System on such day, or if no sale is made on such
    day, the closing bid price for such day as entered by a market maker for the
    Stock;

        (c) if the Stock is not listed on a national securities exchange, it is
    not admitted to unlisted trading privileges on any such exchange, and is not
    eligible for inclusion in the NASDAQ National Market System, the fair market
    value on any given day shall be the average of the closing representative
    bid and asked prices as reported by the National Quotation Bureau, Inc. or,
    if the Stock is not quoted on the National Association of Securities Dealers
    Automated Quotations System, then as reported in any publicly available
    compilation of the bid and asked prices of the Stock in any over-the-
    counter market on which the Stock is traded; or

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        (d) if there exists no public trading market for the Stock, the fair
    market value on any given day shall be an amount determined in good faith by
    the Board in such manner as it may reasonably determine in its discretion,
    provided that such amount shall not be less than the book value per share as
    reasonably determined by the Board as of the date of determination or less
    than the par value of the Stock.

    7.4.   PAYMENT OF PURCHASE PRICE.  Except as provided herein, the purchase
price of each share of Stock purchased upon the exercise of any Option shall be
paid:

        (a) in United States dollars in cash or by check, bank draft or money
    order payable to the order of the Company; or

        (b) at the discretion of the Board, through the delivery of shares of
    Stock, having initially or as a result of successive exchanges of shares, an
    aggregate fair market value (as determined in the manner provided under this
    Plan) equal to the aggregate purchase price for the Stock as to which the
    Option is being exercised; or

        (c) at the discretion of the Board, by a combination of both (a) and
    (b) above; or

        (d) by such other method as may be permitted in the written stock option
    agreement between the Company and the Optionee.

    If such form of payment is permitted, the Board shall determine procedures
for tendering Stock as payment upon exercise of an Option and may impose such
additional limitations and prohibitions on the use of Stock as payment upon the
exercise of an Option as it deems appropriate.

    If the Board in its sole discretion so agrees, the Company may finance the
amount payable by an Optionee upon exercise of any Option upon such terms and
conditions as the Board may determine at the time such Option is granted under
this Plan.

8. EXERCISE OF OPTIONS

    8.1    MANNER OF EXERCISE.  An Option, or any portion thereof, shall be
exercised by delivering a written notice of exercise to the Board and paying to
the Company the full purchase price of the Stock to be acquired upon the
exercise of the Option. Until certificates for Stock acquired upon the exercise
of an Option are issued to an Optionee, such Optionee shall not have any rights
as a shareholder of the Company.

    8.2    LIMITATIONS AND CONDITIONS ON EXERCISE OF OPTIONS.  In addition to
any other limitations or conditions contained in this Plan or that may be
imposed by the Board from time to time or in the stock option agreement to be
entered into with respect to Options granted hereunder, the following
limitations and conditions shall apply to the exercise of Options granted under
this Plan:

    8.2.1  No Incentive Stock Option may be exercisable by its terms after the
expiration of 10 years from the date of the grant thereof.

    8.2.2  No Incentive Stock Option granted pursuant to the Plan to an eligible
Participant then owning more than 10% of the voting power of all classes of the
Company's stock may be exercisable by its terms after the expiration of five
years from the date of the grant thereof.

9. INVESTMENT PURPOSES

    Unless a registration statement under the Securities Act of 1933 is in
effect with respect to Stock to be purchased upon exercise of Options to be
granted under the Plan, the Company shall require that an Optionee agree with
and represent to the Company in writing that he or she is acquiring such shares
of Stock for the purpose of investment and with no present intention to
transfer, sell or otherwise dispose of such shares of stock other than by
transfers which may occur by will or by the laws of descent and

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distribution, and no shares of Stock may be transferred unless, in the opinion
of counsel to the Company, such transfer would be in compliance with applicable
securities laws. In addition, unless a registration statement under the
Securities Act of 1933 is in effect with respect to the Stock to be purchased
under the Plan, each certificate representing any shares of Stock issued to an
Optionee hereunder shall have endorsed thereon a legend in substantially the
following form:

    THE SHARES REPRESENTED BY THIS CERTIFICATE WERE ISSUED WITHOUT REGISTRATION
    UNDER THE SECURITIES ACT OF 1933, AS AMENDED (THE "ACT") AND WITHOUT
    REGISTRATION UNDER ANY APPLICABLE STATE SECURITIES LAWS, IN RELIANCE UPON
    EXEMPTION(S) CONTAINED THEREIN. NO TRANSFER OF THESE SHARES OR ANY INTEREST
    THEREIN MAY BE MADE EXCEPT PURSUANT TO EFFECTIVE REGISTRATION STATEMENTS
    UNDER SAID LAWS UNLESS THE COMPANY HAS RECEIVED AN OPINION OF COUNSEL
    SATISFACTORY TO IT THAT SUCH TRANSFER OR DISPOSITION DOES NOT REQUIRE
    REGISTRATION UNDER SAID LAWS AND, FOR ANY SALES UNDER RULE 144 OF THE ACT,
    SUCH EVIDENCE AS IT SHALL REQUEST FOR COMPLIANCE WITH THAT RULE, OR
    APPLICABLE STATE SECURITIES LAWS.

10. TRANSFERABILITY OF OPTIONS

    No Option granted under the Plan shall be transferable by an Optionee
(whether by sale, assignment, hypothecation or otherwise) other than by will or
the laws of descent and distribution, and shall be exercisable during the
Optionee's lifetime only by the Optionee.

11. TERMINATION OF EMPLOYMENT

    11.1   GENERALLY.  Except as otherwise provided in this Section 11, if any
Optionee's employment with the Company or Subsidiary is terminated (hereinafter
"Termination") other than by death or disability (as hereinafter defined), the
Optionee may exercise any Option granted under the Plan, to the extent the
Optionee was entitled to exercise the Option at the date of Termination, for a
period of three (3) months after the date of Termination or until the term of
the Option has expired, whichever date is earlier.

    11.1.1  The Optionee may exercise any Incentive Stock Option granted under
the Plan, to the extent the Optionee was entitled to exercise the Incentive
Stock Option at the date of Termination, for a period three (3) months after the
date of Termination or until the term of the Incentive Stock Option has expired,
whichever date is earlier.

    11.1.2  The Optionee may exercise any Non-Statutory Stock Option granted
under the Plan, to the extent the Optionee was entitled to exercise the
Non-Statutory Stock Option at the date of Termination, for a period of up to
eighteen (18) months after the date of Termination, as determined by the
Committee, or until the term of the Non-Statutory Option has expired, whichever
date is earlier.

    11.2   DEATH OR DISABILITY OF OPTIONEE.  In the event of the death or
disability of an Optionee prior to expiration of an Option held by him or her,
the following provisions shall apply:

    11.2.1  If the Optionee is at the time of his or her Disability employed by
the Company or a Subsidiary and has been in continuous employment (as determined
by the Board in its sole discretion) since the date of grant of the Option, then
the Option may be exercised by the Optionee until the earlier of one year
following the date of such Disability or the expiration date of the Option, but
only to the extent the Optionee was entitled to exercise such Option at the time
of his or her Disability. For the purpose of this Section 11, the term
"Disability" shall mean a permanent and total disability as defined in Section
22(e)(3) of the Code. The determination of whether an Optionee has a Disability
within the meaning of Section 22(e)(3) shall be made by the Board in its sole
discretion.

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    11.2.2  If the Optionee is at the time of his or her death employed by the
Company or a Subsidiary and has been in continuous employment (as determined by
the Board in its sole discretion) since the date of grant of the Option, then
the Option (including all then vested and unvested options) may be exercised by
the Optionee's estate or by a person who acquired the right to exercise the
Option by will or the laws of descent and distribution, until the earlier of one
year from the date of the Optionee's death or the expiration date of the Option.

    11.2.3  If the Optionee dies within three (3) months after Termination, the
Option may be exercised until the earlier of nine months following the date of
death or the expiration date of the Option, by the Optionee's estate or by a
person who acquired the right to exercise the Option by will or the laws of
descent or distribution, but only to the extent the Optionee was entitled to
exercise the Option at the time of Termination.

    11.3   TERMINATION FOR CAUSE.  If the employment of an Optionee is
terminated by the Company or a Subsidiary for cause, then the Board shall have
the right to cancel any Options granted to the Optionee under the Plan.

12. AMENDMENT AND TERMINATION OF PLAN

    12.1   The Board, may at any time and from time to time suspend or terminate
the Plan in whole or in part or amend it from time to time in such respects as
may be in the best interests of the Company; provided, however, that no such
amendment shall be made without the approval of the shareholders if it would:
(a) materially modify the eligibility requirements for Participants as set forth
in Section 5 hereof; (b) increase the maximum aggregate number of shares of
Stock which may be issued pursuant to Options, except in accordance with Section
4.2 of the Plan; (c) reduce the minimum Option price per share as set forth in
Section 7 of the Plan, except in accordance with Section 4.2 of the Plan;
(d) extend the period of granting Options; or (e) materially increase in any
other way the benefits accruing to Optionees.

    12.2   No amendment, suspension or termination of this Plan shall, without
the Optionee's consent, alter or impair any of the rights or obligations under
any Option theretofore granted to him or her under the Plan.

    12.3   The Board may amend the Plan, subject to the limitations cited above,
in such manner as it deems necessary to permit the granting of Incentive Stock
Options meeting the requirements of future amendments to the Code.

    12.4   In the event of the proposed dissolution or liquidation of the
Company, each Option will terminate immediately prior to the consummation of
such proposed action, unless otherwise provided by the Board. The Board may, in
the exercise of its sole discretion in such instances, declare that any Option
shall terminate as of a date fixed by the Board and give each Optionee the right
to exercise his or her Option as to all or any part of the Optioned Stock,
including Shares as to which the Option would not otherwise be exercisable.

    In the event of a proposed sale of all or substantially all of the assets of
the Company, or the merger of the Company with or into another corporation, the
Optionee shall have the right to exercise the Option as to all of the Optioned
Stock, including Shares as to which the Option would not otherwise be
exercisable. Not less than fifteen (15) days prior to the effective date of the
sale or merger, the Board shall notify the Optionee that the Option shall be
fully exercisable for the period from the date of the notice through and
including the date prior to the effective date of the merger, and the Option
will terminate upon expiration of such period as to any then unexercised
Options.

13. MISCELLANEOUS PROVISIONS

    13.1   RIGHT TO CONTINUED EMPLOYMENT.  No person shall have any claim or
right to be granted an Option under the Plan, and the grant of an Option under
the Plan shall not be construed as giving an

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Optionee the right to continued employment with the Company. The Company further
expressly reserves the right at any time to dismiss an Optionee or reduce an
Optionee's compensation with or without cause, free from any liability, or any
claim under the Plan, except as provided herein or in a stock option agreement.

    13.2   WITHHOLDING TAXES.  The Company shall have the right to require that
payment or provision for payment of any and all withholding taxes due upon the
grant or exercise of an Option hereunder or the disposition of any Stock or
other property acquired upon exercise of an Option be made by an Optionee. In
connection therewith, the Board shall have the right to establish such
rules and regulations or impose such terms and conditions in any agreement
relating to an Option granted hereunder with respect to such withholding as the
Board may deem necessary and appropriate.

    13.3   GOVERNING LAW.  The Plan shall be administered in the State of
Minnesota, and the validity, construction, interpretation, and administration of
the Plan and all rights relating to the Plan shall be determined solely in
accordance with the laws of such state, unless controlled by applicable federal
law, if any.

14. EFFECTIVE DATE

    The effective date of the Plan is January 18, 1991. No Option may be granted
after January 17, 2001, provided, however, that the Plan and all outstanding
Options shall remain in effect until such outstanding Options have expired or
been canceled.

                                       7<PAGE>
                             ARCADIA FINANCIAL LTD.
                        1992 DIRECTOR STOCK OPTION PLAN
                          (AS AMENDED MARCH 16, 2000)

    1.  PURPOSE OF THE PLAN.  The purpose of this 1992 Director Stock Option
Plan, initially adopted by the Board on January 7, 1992, is to attract and
retain the best available individuals to serve as Directors of the Company, to
provide additional incentive to the Outside Directors of the Company to serve as
Directors, and to encourage their continued service on the Board.

    The Company intends that the options granted hereunder shall not constitute
incentive stock options within the meaning of Section 422 of the Internal
Revenue Code of 1986. The Plan is intended to comply with the requirements of
Rule 16b-3 under the Exchange Act.

    2.  DEFINITIONS.  As used herein, the following definitions shall apply:

        (a) "BOARD" shall mean the Board of Directors of the Company.

        (b) "COMMON STOCK" shall mean the Common Stock, $.01 par value per
    share, of the Company.

        (c) "COMPANY" shall mean Arcadia Financial Ltd., a Minnesota
    corporation.

        (d) "COMMITTEE" shall mean a committee of the Board appointed by the
    Board to administer the Plan.

        (e) "CONTINUOUS SERVICE AS A DIRECTOR" shall mean the absence of any
    interruption or termination of service as a Director. Continuous Service as
    a Director shall not be considered interrupted in the case of sick leave,
    military leave, or any other leave of absence approved by the Board or
    Committee.

        (f) "DIRECTOR" shall mean a member of the Board.

        (g) "EMPLOYEE" shall mean any person, including officers and Directors,
    employed by the Company or any Parent or Subsidiary of the Company. The
    payment of fees to a Director shall not be sufficient in and of itself to
    constitute "employment" by the Company.

        (h) "EXCHANGE ACT" shall mean the Securities Exchange Act of 1934, as
    amended.

        (i) "OPTION" shall mean a stock option granted pursuant to the Plan.

        (j) "OPTIONED STOCK" shall mean the Common Stock subject to an Option.

        (k) "OPTIONEE" shall mean an Outside Director who receives an option.

        (l) "OUTSIDE DIRECTOR" shall mean a Director who is not an Employee.

        (m) "PARENT" shall mean a "parent corporation," whether now or hereafter
    existing, as defined in Section 424(e) of the Internal Revenue Code of 1986,
    as amended.

        (n) "PLAN" shall mean this 1992 Director Stock Option Plan.

        (o) "SHARE" shall mean a share of Common Stock, as adjusted in
    accordance with Section 12 of the Plan.

        (p) "SUBSIDIARY" shall mean a "subsidiary corporation," whether now or
    hereafter existing, as defined in Section 424(f) of the Internal Revenue
    Code of 1986, as amended.

    3.  STOCK SUBJECT TO THE PLAN.  Subject to the provisions of Section 12 of
the Plan, the maximum aggregate number of shares which may be optioned and sold
under the Plan is 840,000 shares of Common Stock. The shares may be authorized,
but unissued, or reacquired Common Stock.

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    If an Option expires or becomes unexercisable for any reason without having
been exercised in full, the unexercised Shares which were subject thereto shall,
unless the Plan has been terminated, become available for future grant under the
Plan. If Shares which were acquired upon exercise of an Option are subsequently
repurchased by the Company, such Shares shall not become available for future
grant under the Plan.

    4.  GRANTS OF OPTIONS.  All grants of Options hereunder shall be made
strictly in accordance with the following provisions:

        (a) Intentionally omitted.

        (b) Each Outside Director, including persons who are Outside Directors
    on the date of adoption of the Plan, shall be automatically granted an
    option to purchase Shares (the "First Option") upon the date on which such
    person first becomes an Outside Director, whether through election by the
    shareholders of the Company or appointment by the Board to fill a vacancy.
    The number of Shares constituting the First Option shall be determined based
    upon the calendar year in which the Outside Director first becomes an
    Outside Director, as follows:

<TABLE>
<CAPTION>
CALENDAR YEAR                             OPTION SHARES
-------------                          --------------------
<S>                                    <C>
1992.................................               15,000
1993.................................               15,000
1994.................................               15,000
1995.................................               15,000
1996.................................                5,000
1997.................................               25,000
1998.................................               25,000
1999 and thereafter..................  Annual Grant Amount
</TABLE>

    ; provided however, if an Outside Director first becomes a director on any
day of the calendar year other than the first day thereof, the number of shares
constituting the First Option shall be reduced prorata based upon the days
elapsed in such year as of the date he or she becomes a director.

    For each calendar year commencing with 1999, the Board of Directors shall
each year prior to the date of the annual meeting of the Company for such year
determine the number of Shares which shall constitute the Options to be granted
to each Outside Director for such calendar year (the "Annual Grant Amount"). The
Annual Grant Amount as so determined shall be the number of Shares granted as to
both First Options and Annual Options granted during such calendar year.

        (c) Each calendar year after the First Option has been granted to an
    Outside Director, such Outside Director shall be granted an Option (the
    "Annual Option") on the Grant Date (as hereinafter defined) to purchase the
    number of Shares to be determined based upon the calendar year in which the
    Grant Date occurs, as follows:

<TABLE>
<CAPTION>
CALENDAR YEAR                             OPTION SHARES
-------------                          --------------------
<S>                                    <C>
1992.................................               15,000
1993.................................               15,000
1994.................................               15,000
1995.................................               15,000
1996.................................                5,000
1997.................................               25,000
1998.................................               25,000
1999 and thereafter..................  Annual Grant Amount
</TABLE>

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    As used herein, as to each Outside Director the term "Grant Date" shall mean
    as follows: (i) for calendar years 1993 through 1997, the anniversary date
    of the date of the grant of the First Option to such director; (ii) for the
    calendar year 1998, January 25, 1998; and (iii) for the calendar year 1999
    and thereafter, such date as determined by the Board of Directors as the
    Grant Date for such calendar year in conjunction with its determination of
    the Annual Grant Amount for such year.

        (d) Each Outside Director who is an Outside Director on January 2, 1997,
    shall be automatically granted on such date an Option to purchase 10,000
    Shares.

        (e) Each Outside Director who is an Outside Director on January 20, 1999
    and who has had an Option granted prior to January 1, 1996 expire without
    exercise prior to January 20, 1999 (an "Expired Option"), shall be granted
    on January 20, 1999 an Option (the "Replacement Option") to replace each
    such Expired Option. Each Replacement Option shall (i) be for 15,000 shares;
    (ii) have a term equal to the number of days determined by deducting the
    number of days from the grant date of the Expired Option to January 20, 1999
    from 3,650 days; and (iii) shall have an exercise price per share equal to
    the exercise price of the Expired Option.

        (f) Notwithstanding anything to the contrary contained herein, in no
    event shall an Outside Director be granted Options to purchase in the
    aggregate more than 250,000 Share pursuant to the Plan.

        (g) Notwithstanding the provisions of Sections 4(b), (c) and
    (d) hereof, in the event that a grant would cause the number of Shares
    subject to outstanding Options by Outside Directors plus Shares previously
    purchased upon exercise of Options by Outside Directors to exceed 840,000
    Shares, then each such automatic grant shall be for that number of Shares
    determined by dividing the total number of shares remaining available for
    grant by the number of Outside Directors on the automatic grant date. Any
    further grants shall then be deferred until such time, if any, as additional
    Shares become available for grant under the Plan through action of the
    shareholders to increase the number of Shares which may be issued under the
    Plan or through cancellation or expiration of Options previously granted
    hereunder.

    5.  OPTION TERMS AND CONDITIONS.  The terms and conditions of an Option
granted hereunder shall be as follows:

        (a) subject to Sections 12 and 13 hereof, the term of each Option (other
    than a Replacement Option) shall be ten (10) years. Any Option granted prior
    to January 1, 1996 and not exercised or expired as of January 20, 1999 shall
    be amended to extend the term thereof to ten (10) years from the date of the
    original grant date thereof.

        (b) subject to Sections 12 of 13 hereof, the term of each Replacement
    Option shall be equal to the number of days determined by deducting the
    number of days from the grant date of the related Expired Option to January
    20, 1999 from 3,650 days.

        (c) each First Option and each Annual Option shall become exercisable in
    full beginning on the first anniversary of the grant of the Option provided
    in each case that the Outside Director shall have maintained Continuous
    Service as an Outside Director throughout such 12-month period. Each
    Replacement Option shall be exercisable in full on the grant date thereof.

        (d) the Option shall be exercisable only while the Outside Director
    serves as an Outside Director of the Company, and for a period of two
    (2) years after ceasing to be an Outside Director pursuant to Section
    10(b) hereof.

        (e) except as provided for a Replacement Option in Section 4(e), the
    exercise price per Share shall be 100% of the fair market value per Share on
    the date of grant of the Option, as determined in accordance with Section
    9(a) hereof.

                                       3
<PAGE>
        (f) the effectiveness of any Options granted hereunder is conditioned
    upon shareholder approval of the Plan in accordance with Rule 16b-3 under
    the Exchange Act.

    6.  ADMINISTRATION OF AND GRANTS OF OPTIONS UNDER THE PLAN.

        (a) ADMINISTRATION.  Except as otherwise required herein, the Plan shall
    be administered by the Board or a Committee.

        (b) POWERS OF THE BOARD OR COMMITTEE.  Subject to the provisions and
    restrictions of the Plan, the Board or Committee shall have the authority,
    in its discretion: (i) to determine the Annual Grant Amount and the Grant
    Date for each calendar year after 1997; (ii) to determine, upon review of
    relevant information and in accordance with Section 9(a) hereof, the fair
    market value of the Common Stock; (iii) to interpret the Plan; (iv) to
    prescribe, amend and rescind rules and regulations relating to the Plan;
    (v) to authorize any person to execute on behalf of the Company any
    instrument required to effectuate the grant of an Option hereunder; (vi) to
    accelerate the exercise date of any Option granted hereunder; and (vii) to
    make all other determinations deemed necessary or advisable for the
    administration of the Plan.

        (c) EFFECT OF BOARD'S DECISION.  All decisions, determinations and
    interpretations of the Board or Committee shall be final and binding on all
    Optionees and any other holders of any Options granted under the Plan.

        (d) SUSPENSION OR TERMINATION OF OPTION.  If the Board or Committee
    reasonably believes that an Optionee has committed an act of misconduct, it
    may suspend the Optionee's right to exercise any Option pending a
    determination by the Board or Committee (excluding the Outside Director
    accused of such misconduct). If the Board or Committee (excluding the
    Outside Director accused of such misconduct) determines that an Optionee has
    committed an act of embezzlement, fraud, dishonesty, nonpayment of an
    obligation owed to the Company, breach of fiduciary duty or deliberate
    disregard of the Company's rules resulting in loss, damage or injury to the
    Company, or if an Optionee makes an unauthorized disclosure of any Company
    trade secret or confidential information, engages in any conduct
    constituting unfair competition with respect to the Company, or induces any
    party to breach a contract with the Company, neither the Optionee nor the
    Optionee's estate shall be entitled to exercise any Option whatsoever. In
    making such determination, the Board or Committee (excluding the Outside
    Director accused of such misconduct) shall act fairly and shall give the
    Optionee an opportunity to appear and present evidence on the Optionee's
    behalf at a hearing before the Board or Committee.

        (e) DATE OF GRANT OF OPTIONS.  The date of grant of an Option shall, for
    all purposes, be the date determined in accordance with Section 4 hereof,
    notwithstanding the fact that an Optionee may not have entered into an
    option agreement with the Company on such date. Notice of the grant of an
    Option shall be given to the Optionee within a reasonable time after the
    date of such grant.

    7.  ELIGIBILITY.  Options may be granted only to Outside Directors. All
Options shall be granted in accordance with the terms set forth in Section 4
hereof. The Plan shall not confer upon any Optionee any right with respect to
continuation of service as a Director or nomination to serve as a Director, nor
shall it interfere in any way with any rights which a Director or the Company
may have to terminate such Director's directorship at any time.

    8.  TERM OF PLAN.  The effective date of this Plan is January 7, 1992, the
date upon which it was adopted by the Board. The Plan shall continue in effect
for a term of ten (10) years unless terminated sooner under Section 13 hereof.

    9.  FAIR MARKET VALUE AND FORM OF CONSIDERATION.

        (a) FAIR MARKET VALUE.  The fair market value per share shall be
    determined as follows:

                                       4
<PAGE>
           (i) if the Common Stock is listed on a national securities exchange
       or admitted to unlisted trading privileges on such exchange, the fair
       market value on any given day shall be the closing sale price for the
       Common Stock on such day, as reported in the Wall Street Journal or other
       newspaper of general circulation;

           (ii) if the Common Stock is not listed on a national securities
       exchange, the fair market value on any given day shall be the closing
       sale price for the Common Stock on the NASDAQ National Market System on
       such day, as reported in the Wall Street Journal or other newspaper of
       general circulation;

          (iii) if the Common Stock is not listed on a national securities
       exchange, is not admitted to unlisted trading privileges on any such
       exchange, and is not eligible for inclusion on the NASDAQ National Market
       System, the fair market value on any given day shall be the average of
       the closing representative bid and asked prices on such day, as reported
       on the NASDAQ System, and if not reported on such system, then as
       reported by the National Quotation Bureau, Inc. or such other publicly
       available compilation of the bid and asked prices of the Common Stock in
       any over-the-counter market on which the Common Stock is traded; or

           (iv) if there exists no public trading market for the Common Stock,
       the fair market value on any given day shall be an amount determined by
       the Board or Committee in such manner as it may reasonably determine in
       its discretion, provided that such amount shall not be less than the book
       value per share as reasonably determined by the Board or Committee as of
       the date of determination nor less than the par value of the Stock.

        (b) FORM OF CONSIDERATION.  The consideration to be paid for the Shares
    to be issued upon exercise of an Option shall consist entirely of cash or
    such other form of consideration as the Board or Committee may determine, in
    its sole discretion, to be appropriate for payment, including but not
    limited to other shares of Common Stock having a fair market value on the
    date of surrender equal to the aggregate exercise price of the Shares as to
    which the Option is exercised, or any combination of such methods of
    payment.

    10. EXERCISE OF OPTION.

        (a) PROCEDURE FOR EXERCISE; RIGHTS AS A SHAREHOLDER. Any Option granted
    hereunder shall be exercisable at such times as are set forth in Section 5
    hereof. An Option may not be exercised for a fraction of a Share.

        An Option shall be deemed to be exercised when written notice of such
    exercise has been given to the Company in accordance with the terms of the
    Option by the person entitled to exercise the Option and full payment for
    the Shares with respect to which the Option is exercised has been received
    by the Company. Full payment may consist of any consideration and method of
    payment allowable under Section 9(b) hereof. Until the issuance (as
    evidenced by the appropriate entry on the books of the Company or of a duly
    authorized transfer agent of the Company) of the stock certificate
    evidencing such Shares, no right to vote or receive dividends or any other
    rights as a shareholder shall exist with respect to the Optioned Stock,
    notwithstanding the exercise of the Option. A share certificate for the
    number of Shares so acquired shall be issued to the Optionee as soon as
    practicable after exercise of the Option. No adjustment will be made for a
    dividend or other right for which the record date is prior to the date the
    stock certificate is issued, except as provided in Section 12 hereof.

        Exercise of an Option in any manner shall result in a decrease in the
    number of Shares which thereafter may be available, both for purposes of the
    Plan and for sale under the Option, by the number of Shares as to which the
    Option was exercised.

        (b) TERMINATION OF STATUS AS A DIRECTOR.  If an Optionee ceases to serve
    as a Director, the Optionee may, but only within two (2) years after the
    date the Optionee ceases to be an Outside

                                       5
<PAGE>
    Director of the Company, exercise his or her Option to the extent the
    Optionee was entitled to exercise it at the date of such termination. To the
    extent that the Optionee was not entitled to exercise an Option at the date
    of such termination, or if the Optionee does not exercise such Option within
    the time specified herein, the Option shall terminate.

        (c) DEATH OF OPTIONEE.  In the event of the death of an Optionee
    occurring:

           (i) during the term of the Option, and provided that the Optionee was
       at the time of death a Director of the Company and had been in Continuous
       Service as a Director since the date of grant of the Option, the Option
       may be exercised, at any time within six (6) months following the date of
       death, by the Optionee's estate or by a person who acquired the right to
       exercise the Option by bequest or inheritance, but only to the extent of
       the right to exercise that would have accrued had the Optionee continued
       living and remained in Continuous Service a Director for six (6) months
       after the date of death.

           (ii) within thirty (30) days after the termination of Continuous
       Service as a Director, the Option may be exercised, at any time within
       six (6) months following the date of death, by the Optionee's estate or
       by a person who acquired the right to exercise the Option by bequest or
       inheritance, but only to the extent of the right to exercise that had
       accrued at the date of termination of Continuous Service as a Director.

    11. NON-TRANSFERABILITY OF OPTIONS.  Without the prior written consent of
the Board, an Option may not be sold, pledged, assigned, hypothecated,
transferred, or disposed of in any manner other than by will or by the laws of
descent or distribution and may be exercised, during the lifetime of the
Optionee, only by the Optionee.

    12. ADJUSTMENTS UPON CHANGES IN CAPITALIZATION OR MERGER.  The number of
shares of Common Stock covered by each outstanding Option, and the number of
shares of Common Stock which have been authorized for issuance under the Plan
but as to which Options have not yet been granted or which have been returned to
the Plan upon cancellation or expiration of an Option, as well as the price per
share of Common Stock covered by each such outstanding Option, shall be
proportionately adjusted for any increase or decrease in the number of issued
and outstanding shares of Common Stock resulting from a stock split, reverse
stock split, stock dividend, combination or reclassification of the Common
Stock, or any other increase or decrease in the number of issued shares of
Common Stock effected without receipt of consideration by the Company; provided,
however, that conversion of any convertible securities of the Company shall not
be deemed to have been "effected without receipt of consideration." Such
adjustment shall be made by the Board, whose determination in that respect shall
be final, binding and conclusive. Except as expressly provided herein, no
issuance by the Company of shares of stock of any class, or securities
convertible into shares of stock of any class, or options or rights to purchase
shares of stock of any class shall affect, and no adjustment by reason thereof
shall be made with respect to, the number or price of shares of Common Stock
subject to an Option.

    In the event of the proposed dissolution or liquidation of the Company, each
Option will terminate immediately prior to the consummation of such proposed
action, unless otherwise provided by the Board. The Board may, in the exercise
of its sole discretion in such instances, declare that any Option shall
terminate as of a date fixed by the Board and give each Optionee the right to
exercise his or her Option as to all or any part of the Optioned Stock,
including Shares as to which the Option would not otherwise be exercisable.

    In the event of a proposed sale of all or substantially all of the assets of
the Company, or the merger of the Company with or into another corporation, the
Optionee shall have the right to exercise the Option as to all of the Optioned
Stock, including Shares as to which the Option would not otherwise be
exercisable. Not less than fifteen (15) days prior to the effective date of the
sale or merger, the Board shall notify the Optionee that the Option shall be
fully exercisable for the period from the date of the notice through and

                                       6
<PAGE>
including the date prior to the effective date of the merger, and the Option
will terminate upon expiration of such period as to any then unexercised
Options.

    13. AMENDMENT, TERMINATION AND APPROVAL OF THE PLAN.  The Board may at any
time amend or terminate the Plan, except that the Board shall not amend the Plan
more than once every six (6) months with respect to the provisions of the Plan
relating to the amount, price, and timing of grants, other than to comply with
changes in the Internal Revenue Code of 1986, the Employee Retirement Income
Security Act of 1974, as amended, or the regulations thereunder. No Option may
be granted after the Plan is terminated. The foregoing provisions of this
Section notwithstanding, no amendment or termination shall, without the consent
of the holder of an Option, alter or impair any rights or obligations under any
Option theretofore granted under the Plan except as is permitted pursuant to
Section 12 of the Plan.

    If any amendment to the Plan requires approval by the shareholders of the
Company for continued applicability of Rule 16b-3 under the Exchange Act, or for
initial or continued listing of the Common Stock or other securities of the
Company upon any stock exchange, then such amendment shall be approved by the
holders of a majority of the Company's outstanding capital stock entitled to
vote.

    14. CONDITIONS UPON ISSUANCE OF SHARES.  Shares shall not be issued pursuant
to the exercise of an Option unless the exercise of such Option and the issuance
and delivery of such Shares pursuant thereto shall comply with all relevant
provisions of law, including, without limitation, the Securities Act of 1933, as
amended, the Exchange Act, the rules and regulations promulgated thereunder,
state securities laws, and the requirements of the NASD or any stock exchange
upon which the Shares may then be listed, and shall be further subject to the
approval of counsel for the Company with respect to such compliance.

    As a condition to the exercise of an Option, the Company may require the
person exercising such Option to represent and warrant at the time of any such
exercise that the Shares are being purchased only for investment and without any
present intention to sell or distribute such Shares, if, in the opinion of
counsel for the Company, such a representation is required by any of the
aforementioned relevant provisions of law. Such Shares may also be issued with
appropriate legends on stock certificates representing such Shares, and the
Company may place stop transfer orders with respect to such Shares.

    Inability of the Company to obtain authority from any regulatory body having
jurisdiction, which authority is deemed by the Company's counsel to be necessary
to the lawful issuance and sale of any Shares hereunder, shall relieve the
Company of any liability in respect of the failure to issue or sell such Shares
as to which such requisite authority shall not have been obtained.

    15. RESERVATION OF SHARES.  The Company, during the term of this Plan, will
at all times reserve and keep available such number of Shares as shall be
sufficient to satisfy the requirements of the Plan.

    16. OPTION AGREEMENT.  Options shall be evidenced by written option
agreements in substantially the form attached hereto or in such other form as
the Board or Committee shall approve.

    17. INFORMATION TO OPTIONEES.  The Company shall provide to each Optionee,
during the period for which such Optionee has one or more Options outstanding,
copies of all annual reports and other information which are provided to all
shareholders of the Company.

                                       7

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