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                                                                    EXHIBIT 10.1

                             VIVID TECHNOLOGY, INC.

                       1989 COMBINATION STOCK OPTION PLAN
                        (AS AMENDED THROUGH MAY 7, 1996)

Section I.        Purpose of the Plan.

         The purposes of this Vivid Technology, Inc. 1989 Combination Stock
Option Plan (the "1989 Plan") are (i) to provide long-term incentives and
rewards to those key employees (the "Employee Participants") of Vivid
Technologies, Inc. (the "Corporation") and its subsidiaries (if any), and any
other persons (the "Non-employee Participants") who are in a position to
contribute to the long-term success and growth of the Corporation and its
subsidiaries, (ii) to assist the Corporation in retaining and attracting
executives and key employees with requisite experience and ability, and (iii) to
associate more closely the interests of such executives and key employees with
those of the Corporation's stockholders. The term "key employees" shall include
division and department managers, supervisory personnel and other persons who
are also employees of the Corporation or of a Parent or Subsidiary who the Board
of Directors or the Committee shall deem to be valuable contributors to the
success of the Corporation.

Section II.       Definitions.

         Code. The "Code" is the Internal Revenue Code of 1986, as it may be
amended from time to time.

         Common Stock. "Common Stock" is the $.01 par value common stock of the
Corporation.

         Committee. "Committee" is defined in Section III, paragraph (a).

         Corporation. "Corporation" is defined in Section I.

         Corporation ISOs. "Corporation ISOs" are all stock options (including
1989 Plan ISOs) which (i) are Incentive Stock Options and (ii) are granted on or
after January 1, 1989 under any plans (including this 1989 Plan) of the
Corporation, a Parent Corporation and/or a Subsidiary Corporation.

         Employee Participants. "Employee Participants" is defined in Section I.

         Fair Market Value. The "Fair Market Value" of any property is the value
of the property as reasonably determined by the Committee.

         Inventive Stock Option. An "Incentive Stock Option" is a stock option
which is treated as an incentive stock option under Section 422A of the Code.

         1989 Plan. "1989 Plan" is defined in Section I.
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         1989 Plan ISOs. "1989 Plan ISOs" are Stock Options which are Incentive
Stock Options.

         Non-employee Participants. "Non-employee Participants" is defined in
Section I.

         Non-qualified Option. A "Non-qualified Option" is a Stock Option which
does not qualify as an Incentive Stock Option or for which the Committee
provides, in the terms of such option and at the time such option is granted,
that the option shall not be treated as an Incentive Stock Option.

         Parent Corporation. "Parent Corporation" has the meaning provided in
Section 425(e) of the Code.

         Participants. "Participants" are all persons who are either Employee
Participants or Non-employee Participants.

         Permanent and Total Disability. "Permanent and Total Disability" has
the meaning provided in Section 22(e)(3) of the Code.

         Stock Options. "Stock Options" are rights granted pursuant to this 1989
Plan to purchase shares of Common Stock at a fixed price.

         Subsidiary Corporation. "Subsidiary Corporation" has the meaning
provided in Section 425(f) of the Code.

         Ten Percent Stockholder. "Ten Percent Stockholder" means, with respect
to a 1989 Plan ISO, any individual who directly or indirectly owns stock
possessing more than 10% of the total combined voting power of all classes of
stock of the Corporation or any Parent Corporation or any Subsidiary Corporation
at the time such 1989 Plan ISO is granted.

         Section III. Administration.

         (a) The Committee. The Plan shall be administered by the Board of
Directors of the Corporation, or if the Board so determines, by a Compensation
Committee designated by the Board of Directors of the Corporation (the
administering body is hereafter referred to as the "Committee"). The Committee
shall serve at the pleasure of the Board of Directors, which may from time to
time, and in its sole discretion, discharge any member, appoint additional new
members in substitution for those previously appointed and/or fill vacancies
however caused. A majority of the Committee shall constitute a quorum and the
acts of a majority of the members present at any meeting at which a quorum is
present shall be deemed the action of the Committee.

         (b) Authority and Discretion of the Committee. Subject to the express
provisions of this 1989 Plan and provided that all actions taken shall be
consistent with the purposes of this 1989 Plan, and subject to ratification by
the Board of Directors only if required by applicable law, the Committee shall
have full and complete authority and

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the sole discretion to: (i) determine those persons who shall constitute
Employee Participants and Non-employee Participants; (ii) select the
Participants to whom Stock Options shall be granted under this 1989 Plan; (iii)
determine the size and the form of the Stock Options, if any, to be granted to
any Participant; (iv) determine the time or times such Stock Options shall be
granted including the grant of Stock Options in connection with other awards
made, or compensation paid, to the Participant; (v) establish the terms and
conditions upon which such Stock Options may be exercised and/or transferred,
including the exercise of Stock Options in connection with other awards made, or
compensation paid, to the Participant; (vi) make or alter any restrictions and
conditions upon such Stock Options and the Stock received on exercise thereof,
including, but not limited to, providing for limitations on the Participant's
right to keep any Stock received on termination of employment; and (vii) adopt
such rules and regulations, establish, define and/or interpret these and any
other terms and conditions, and make all determinations (which may be on a
case-by-case basis) deemed necessary or desirable for the administration of this
1989 Plan. Notwithstanding any provision of this 1989 Plan to the contrary, only
Employee Participants shall be eligible to receive 1989 Plan ISOs.

         (c) Applicable Law. This 1989 Plan, and all Stock Options shall be
governed by the law of the state in which the Corporation is incorporated.

         Section IV. Terms of Stock Options.

         (a) Agreements. Stock Options shall be evidenced by a written agreement
between the Corporation and the Participant awarded the Stock Option. Said
agreement shall be in such form, and contain such terms and conditions (not
inconsistent with this 1989 Plan) as the Committee may determine. If the Stock
Option described therein is not intended to be an Incentive Stock Option, such
agreement shall include the following, or a similar statement: "This stock
option is not intended to be an Incentive Stock Option, as that term is
described in Section 422A of the Internal Revenue Code of 1986, as amended."

         (b) Term. Stock Options shall be for such periods as may be determined
by the Committee, provided that in the case of 1989 Plan ISOs, the term of any
such 1989 Plan ISO shall not extend beyond three months after the time the
Participant ceases to be an employee of the Corporation. Notwithstanding the
foregoing, the Committee may provide in a 1989 Plan ISO that in the event of the
Permanent and Total Disability or death of the Participant, the 1989 Plan ISO
may be exercised by the Participant or his estate (if applicable) for a period
of up to one year after the date of such Permanent and Total Disability or
Death. In no event may a 1989 Plan ISO be exercisable (including provisions, if
any, for exercise in installments) subsequent to ten years after the date of
grant, or, in the case of 1989 Plan ISOs granted to Ten Percent Stockholders,
more than five years after the date of grant.

         (c) Purchase Price. The purchase price of shares purchased pursuant to
any Stock Option shall be determined by the Committee, and shall be paid by the
employee in full upon exercise, (a) in cash, (b) by delivery of shares of Common
Stock (valued at their Fair Market Value on the date of such exercise), (c) any
other property (valued at its Fair

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Market Value on the date of such exercise), or (d) any combination of cash,
stock and other property, each of the foregoing only as the Committee, in its
sole discretion, may permit. In no event will the purchase price of Common Stock
subject to a 1989 Plan ISO be less than the Fair Market Value of the Common
Stock on the date of the issuance of the 1989 Plan ISO, provided that in the
case of 1989 Plan ISOs granted to Ten Percent Stockholders, the purchase price
shall not be less than 110% of the Fair Market Value of the Common Stock on the
date of issuance of the 1989 Plan ISO.

         (d) Further Restrictions as to Incentive Stock Options. To the extent
that the aggregate Fair Market Value of Common Stock with respect to which
Corporation ISOs (determined without regard to this section) are exercisable for
the first time by any Employee Participant during any calendar year exceeds
$100,000, such Corporation ISOs shall be treated as options which are not
Incentive Stock Options.

         (e) Restrictions. At the discretion of the Committee, the Common Stock
issued pursuant to the Stock Options granted hereunder may be subject to the
restrictions on vesting or transferability.

         (f) Withholding of Taxes. Pursuant to applicable Federal, state, local
or foreign laws, the Corporation may be required to collect income or other
taxes upon the grant of a Stock Option to, or exercise of a Stock Option by, a
holder. The Corporation may require, as a condition to the exercise of a Stock
Option, or demand, at such other time as it may consider appropriate, that the
Employee pay the Corporation the amount of any taxes which the Corporation may
determine is required to be withheld or collected, and the Employee shall comply
with the requirement or demand of the Corporation.

         (g) Securities Law Compliance. Upon exercise (or partial exercise) of a
Stock Option, the Employee shall make such representations and furnish such
information as may, in the opinion of counsel for the Corporation, be
appropriate to permit the Corporation to issue or transfer Stock in compliance
with the provisions of applicable federal or state securities laws. The
Corporation, in its discretion, may postpone the issuance and delivery of Stock
upon any exercise of this Option until completion of such registration or other
qualification of such shares under any federal or state laws, or stock exchange
listing, as the Corporation may consider appropriate. The Corporation may
require that prior to the issuance or transfer of Stock upon exercise of a Stock
Option, the Employee enter into a written agreement to comply with any
restrictions on subsequent disposition that the Corporation deems necessary or
advisable under any applicable federal and state securities laws. Certificates
of Stock issued hereunder may be legended to reflect such restrictions.

         (h) Right to Stock Option. No employee of the Corporation or any other
person shall have any claim or right to be a participant in this 1989 Plan or to
be granted a Stock Option hereunder. Neither this 1989 Plan nor any action taken
hereunder shall be construed as giving any person any right to be retained in
the employ of the Corporation. Nothing contained hereunder shall be construed as
giving any person any equity or interest of any kind in any assets of the
Corporation or creating a trust of any kind or a fiduciary relationship of any
kind between the Corporation and any such person. As to

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any claim for any unpaid amounts under this 1989 Plan, any person having a claim
for payments shall be an unsecured creditor.

         (i) Indemnity. Neither the Board of Directors nor the Committee, nor
any members of either, nor any employees of the Corporation or any subsidiary,
shall be liable for any act, omission, interpretation, construction or
determination made in good faith in connection with their responsibilities with
respect to this 1989 Plan, and the Corporation hereby agrees to indemnify the
members of the Board of Directors, the members of the Committee, and the
employees of the Corporation and its subsidiaries in respect of any claim, loss,
damage, or expense (including counsel fees) arising from any such act, omission,
interpretation, construction or determination to the full extent permitted by
law.

         (j) Participation by Foreigners. Without amending this 1989 Plan,
except to the extent required by the Code in the case of Incentive Stock
Options, the Committee may modify grants made to participants who are foreign
nationals or employed outside the United States so as to recognize differences
in local law, tax policy, or custom.

         Section V. Amendment and Termination; Adjustments Upon Changes in
                    Stock.

         The Board of Directors of the Corporation may at any time, and from
time to time, amend, suspend or terminate this 1989 Plan in whole or in part;
provided, however, that the Board of Directors may not materially increase the
benefits accruing to Participants, increase the number of shares of Common Stock
reserved for purposes of this 1989 Plan, extend the term of this 1989 Plan or
materially modify the requirements to be a Participant in this 1989 Plan without
further approval by the affirmative vote of at least a majority of the holders
of the outstanding shares of Common Stock. Except as provided herein, no
amendment, suspension or termination of this 1989 Plan may affect the rights of
a Participant to whom a Stock Option has been granted without such Participant's
consent. The Committee is specifically authorized to convert the unexercised
portion of any 1989 Plan ISO granted to an Employee Participant to a
Non-qualified Option at any time prior to the exercise, in full, of such 1989
Plan ISO. If there shall be any change in the Common Stock or to any Stock
Option granted under this 1989 Plan through merger, consolidation,
reorganization, recapitalization, stock dividend, stock split or other change in
the corporate structure of the Corporation, appropriate adjustments may be made
by the Board of Directors of the Corporation (or if the Corporation is not the
surviving corporation in any such transaction, the Board of Directors of the
surviving corporation) in the aggregate number and kind of shares subject to
this 1989 Plan, and the number and kind of shares and the price per share
subject to outstanding options, provided that such adjustment does not affect
the qualification of any 1989 Plan ISO as an Incentive Stock Option. In
connection with the foregoing, the Board of Directors may issue new Stock
Options in exchange for outstanding Stock Options.

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         Section VI. Shares of Stock Subject to the Plan.

         The number of shares of Common Stock that may be the subject of awards
under this 1989 Plan shall not exceed an aggregate of 1,250,000 shares. Shares
to be delivered under this 1989 Plan may be either authorized but unissued
shares of Common Stock or treasury shares. Any shares subject to an option
hereunder which for any reason expires unexercised, shares reacquired by the
Corporation because restrictions do not lapse, shares returned because payment
is made hereunder in stock of equivalent value rather than in cash, and/or
shares reacquired for a recipient for any other reason shall, at such time, no
longer count towards the aggregate number of shares which have been the subject
of Stock Options issued hereunder, and such number of shares shall be subject to
further awards under this 1989 Plan, provided the total number of shares then
eligible for award under this 1989 Plan may not exceed the total specified in
the first sentence of this Section VI.

         Section VII. Effective Date and Term of this Plan.

         The effective date of this 1989 Plan is June 22, 1989 (the "Effective
Date") and awards under this 1989 Plan may be made for a period of ten years
commencing on the Effective Date. The period during which a Stock Option may be
exercised may extend beyond that time as provided herein.

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                                                                    EXHIBIT 10.2

                            VIVID TECHNOLOGIES, INC.

                           1996 EQUITY INCENTIVE PLAN

Section 1.  Purpose

        The purpose of the Vivid Technologies, Inc. 1996 Equity Incentive Plan
(the "Plan") is to attract and retain key employees, directors, advisors and
consultants to provide an incentive for them to assist Vivid Technologies, Inc.
(the "Company") to achieve long-range performance goals, and to enable them to
participate in the long-term growth of the Company.

Section 2.  Definitions

(a)      "Affiliate" means any business entity in which the Company owns
         directly or indirectly 50% or more of the total combined voting power
         or has a significant financial interest as determined by the Committee.

(b)      "Award" means any Option, Stock Appreciation Right, Performance or
         Award Share, or Restricted Stock awarded under the Plan.

(c)      "Award Share" means a share of Common Stock awarded to an employee,
         director, advisor or consultant without payment therefor.

(d)      "Board" means the Board of Directors of the Company.

(e)      "Code" means the Internal Revenue Code of 1986, as amended from time to
         time.

(f)      "Committee" means a committee of not less than three members of the
         Board appointed by the Board to administer the Plan. Alternatively, if
         the Board so designates, the President of the Company shall serve as
         the sole member of the Committee.

(g)      "Common Stock" or "Stock" means the Common Stock, par value $.01 per
         share, of the Company.

(h)      "Company" means Vivid Technologies, Inc.

(i)      "Designated Beneficiary" means the beneficiary designated by a
         Participant, in a manner determined by the Board, to receive amounts
         due or exercise rights of the Participant in the event of the
         Participant's death. In the absence of an effective designation by a
         Participant, Designated Beneficiary shall mean the Participant's
         estate.

(j)      "Fair Market Value" means, with respect to Common Stock or any other
         property, the fair market value of such property as determined by the
         Board in good faith or in the manner established by the Board from time
         to time.

(k)      "Incentive Stock Option" means an option to purchase shares of Common
         Stock awarded to a Participant under Section 6 which is intended to
         meet the requirements of Section 422 of the Code or any successor
         provision.

(l)      "Nonstatutory Stock Option" means an option to purchase shares of
         Common Stock awarded to a Participant under Section 6 which is not
         intended to be an Incentive Stock Option.
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(m)      "Option" means an Incentive Stock Option or a Nonstatutory Stock
         Option.

(n)      "Participant" means a person selected by the Board to receive an Award
         under the Plan.

(o)      "Performance Cycle" or "Cycle" means the period of time selected by the
         Board during which performance is measured for the purpose of
         determining the extent to which an award of Performance Shares has been
         earned.

(p)      "Performance Shares" mean shares of Common Stock which may be earned by
         the achievement of performance goals awarded to a Participant under
         Section 8.

(q)      "Restricted Period" means the period of time selected by the Board
         during which an award of Restricted Stock may be forfeited to the
         Company.

(r)      "Restricted Stock" means shares of Common Stock subject to forfeiture
         awarded to a Participant under Section 9.

(s)      "Stock Appreciation Right" or "SAR" means a right to receive any excess
         in value of shares of Common Stock over the exercise price awarded to a
         Participant under Section 7.

(t)      "Stock Unit" means an award of Common Stock or units that are valued in
         whole or in part by reference to, or otherwise based on, the value of
         Common Stock, awarded to a Participant under Section 10.

Section 3.  Administration

        The Plan shall be administered by the Board. The Board shall have
authority to adopt, alter and repeal such administrative rules, guidelines and
practices governing the operation of the Plan as it shall from time to time
consider advisable, and to interpret the provisions of the Plan. The Board's
decisions shall be final and binding. To the extent permitted by applicable law,
the Board may delegate to the Committee the power to make Awards to Participants
and all determinations under the Plan with respect thereto.

Section 4.  Eligibility

        All employees and, in the case of Awards other than Incentive Stock
Options, directors, advisors and consultants of the Company or any Affiliate
capable of contributing significantly to the successful performance of the
Company, other than a person who has irrevocably elected not to be eligible, are
eligible to be Participants in the Plan.

Section 5.  Stock Available for Awards

(a)      Subject to adjustment under subsection (b), Awards may be made under
         the Plan of Options to acquire not in excess of 750,000 shares of
         Company Common Stock. Other Awards may be made as the Board may
         determine, provided that a maximum of 750,000 shares of Common Stock
         may be issued under this Plan. If any Award in respect of shares of
         Common Stock expires or is terminated unexercised or is forfeited for
         any reason or settled in a manner that results in fewer shares
         outstanding than were initially awarded, including without limitation
         the surrender of shares in payment for the Award or any tax obligation
         thereon, the shares subject to such Award or so surrendered, as the
         case may be, to the extent of such expiration, termination, forfeiture
         or decrease, shall again be available for award under the Plan,
         subject, however, in the case of Incentive Stock Options, to any
         limitation required

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         under the Code. Common Stock issued through the assumption or
         substitution of outstanding grants from an acquired company shall not
         reduce the shares available for Awards under the Plan. Shares issued
         under the Plan may consist in whole or in part of authorized but
         unissued shares or treasury shares.

(b)      In the event that the Board determines that any stock dividend,
         extraordinary cash dividend, creation of a class of equity securities,
         recapitalization, reorganization, merger, consolidation, split-up,
         spin-off, combination, exchange of shares, warrants or rights offering
         to purchase Common Stock at a price substantially below fair market
         value, or other similar transaction affects the Common Stock such that
         an adjustment is required in order to preserve the benefits or
         potential benefits intended to be made available under the Plan, then
         the Board, subject, in the case of Incentive Stock Options, to any
         limitation required under the Code, shall equitably adjust any or all
         of (i) the number and kind of shares in respect of which Awards may be
         made under the Plan, (ii) the number and kind of shares subject to
         outstanding Awards, and (iii) the award, exercise or conversion price
         with respect to any of the foregoing, and if considered appropriate,
         the Board may make provision for a cash payment with respect to an
         outstanding Award, provided that the number of shares subject to any
         Award shall always be a whole number.

Section 6.  Stock Options

(a)      Subject to the provisions of the Plan, the Board may award Incentive
         Stock Options and Nonstatutory Stock Options and determine the number
         of shares to be covered by each Option, the option price therefor and
         the conditions and limitations applicable to the exercise of the
         Option. The terms and conditions of Incentive Stock Options shall be
         subject to and comply with Section 422 of the Code, or any successor
         provision, and any regulations thereunder.

(b)      The Board shall establish the option price at the time each Option is
         awarded, which price shall not be less than 100% of the Fair Market
         Value of the Common Stock on the date of award with respect to
         Incentive Stock Options.

(c)      Each Option shall be exercisable at such times and subject to such
         terms and conditions as the Board may specify in the applicable Award
         or thereafter. The Board may impose such conditions with respect to the
         exercise of Options, including conditions relating to applicable
         federal or state securities laws, as it considers necessary or
         advisable.

(d)      No shares shall be delivered pursuant to any exercise of an Option
         until payment in full of the option price therefor is received by the
         Company. Such payment may be made in whole or in part in cash or, to
         the extent permitted by the Board at or after the award of the Option,
         by delivery of a note or shares of Common Stock owned by the
         optionholder, including Restricted Stock, valued at their Fair Market
         Value on the date of delivery, or such other lawful consideration as
         the Board may determine.

(e)      The Board may provide for the automatic award of an Option upon the
         delivery of shares to the Company in payment of an Option for up to the
         number of shares so delivered.

(f)      In the case of Incentive Stock Options the following additional
         conditions shall apply:

         (i)      Such options shall be granted only to employees of the
                  Company, and shall not be granted to any person who owns stock
                  that possesses more than ten percent of the total combined
                  voting power of all classes of stock of the Company or of its
                  parent or

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                  subsidiary corporation (as those terms are defined in section
                  422(b) of the Internal Revenue Code of 1986, as amended, and
                  the regulations promulgated thereunder), unless, at the time
                  of such grant, the exercise price of such option is at least
                  110% of the fair market value of the stock that is subject to
                  such option and the option shall not be exercisable more than
                  five years after the date of grant;

         (ii)     Such options shall not be exercisable more than ten years from
                  the date hereof and shall not be exercisable more than ten
                  years from the date of grant;

         (iii)    Such options shall, by their terms, be transferable by the
                  optionee only by will or the laws of descent and distribution,
                  and shall be exercisable only by such employee during his
                  lifetime.

Section 7.  Stock Appreciation Rights

        Subject to the provisions of the Plan, the Board may award SARs in
tandem with an Option (at or after the award of the Option), or alone and
unrelated to an Option. SARs in tandem with an Option shall terminate to the
extent that the related Option is exercised, and the related Option shall
terminate to the extent that the tandem SARs are exercised.

Section 8.  Performance Shares

(a)      Subject to the provisions of the Plan, the Board may award Performance
         Shares and determine the number of such shares for each Performance
         Cycle and the duration of each Performance Cycle. There may be more
         than one Performance Cycle in existence at any one time, and the
         duration of Performance Cycles may differ from each other. The payment
         value of Performance Shares shall be equal to the Fair Market Value of
         the Common Stock on the date the Performance Shares are earned or, in
         the discretion of the Board, on the date the Board determines that the
         Performance Shares have been earned.

(b)      The Board shall establish performance goals for each Cycle, for the
         purpose of determining the extent to which Performance Shares awarded
         for such Cycle are earned, on the basis of such criteria and to
         accomplish such objectives as the Board may from time to time select.
         During any Cycle, the Board may adjust the performance goals for such
         Cycle as it deems equitable in recognition of unusual or non-recurring
         events affecting the Company, changes in applicable tax laws or
         accounting principles, or such other factors as the Board may
         determine.

(c)      As soon as practicable after the end of a Performance Cycle, the Board
         shall determine the number of Performance Shares which have been earned
         on the basis of performance in relation to the established performance
         goals. The payment values of earned Performance Shares shall be
         distributed to the Participant or, if the Participant has died, to the
         Participant's Designated Beneficiary, as soon as practicable
         thereafter. The Board shall determine, at or after the time of award,
         whether payment values will be settled in whole or in part in cash or
         other property, including Common Stock or Awards.

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Section 9.  Restricted Stock

(a)      Subject to the provisions of the Plan, the Board may award shares of
         Restricted Stock and determine the duration of the Restricted Period
         during which, and the conditions under which, the shares may be
         forfeited to the Company and the other terms and conditions of such
         Awards. Shares of Restricted Stock may be issued for no cash
         consideration or such minimum consideration as may be required by
         applicable law.

(b)      Shares of Restricted Stock may not be sold, assigned, transferred,
         pledged or otherwise encumbered, except as permitted by the Board,
         during the Restricted Period. Shares of Restricted Stock shall be
         evidenced in such manner as the Board may determine. Any certificates
         issued in respect of shares of Restricted Stock shall be registered in
         the name of the Participant and unless otherwise determined by the
         Board, deposited by the Participant, together with a stock power
         endorsed in blank, with the Company. At the expiration of the
         Restricted Period, the Company shall deliver such certificates to the
         Participant or if the Participant has died, to the Participant's
         Designated Beneficiary.

Section 10.  Stock Units

(a)      Subject to the provisions of the Plan, the Board may award Stock Units
         subject to such terms, restrictions, conditions, performance criteria,
         vesting requirements and payment rules as the Board shall determine.

(b)      Shares of Common Stock awarded in connection with a Stock Unit Award
         shall be issued for no cash consideration or such minimum consideration
         as may be required by applicable law. Such shares of Common Stock may
         be designated as Award Shares by the Board.

Section 11.  General Provisions Applicable to Awards

(a)      Documentation. Each Award under the Plan shall be evidenced by a
         writing delivered to the Participant specifying the terms and
         conditions thereof and containing such other terms and conditions not
         inconsistent with the provisions of the Plan as the Board considers
         necessary or advisable to achieve the purposes of the Plan or comply
         with applicable tax and regulatory laws and accounting principles.

(b)      Board Discretion. Each type of Award may be made alone, in addition to
         or in relation to any other type of Award. The terms of each type of
         Award need not be identical, and the Board need not treat Participants
         uniformly. Except as otherwise provided by the Plan or a particular
         Award, any determination with respect to an Award may be made by the
         Board at the time of award or at any time thereafter. Without limiting
         the foregoing, an Award may be made by the Board, in its discretion, to
         any 401(k), savings, pension, profit sharing or other similar plan of
         the Company in lieu of or in addition to any cash or other property
         contributed or to be contributed to such plan.

(c)      Settlement. The Board shall determine whether Awards are settled in
         whole or in part in cash, Common Stock, other securities of the
         Company, Awards or other property. The Board may permit a Participant
         to defer all or any portion of a payment under the Plan, including the
         crediting of interest on deferred amounts denominated in cash and
         dividend equivalents on amounts denominated in Common Stock.

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(d)      Dividends and Cash Awards. In the discretion of the Board, any Award
         under the Plan may provide the Participant with (i) dividends or
         dividend equivalents payable currently or deferred with or without
         interest, and (ii) cash payments in lieu of or in addition to an Award.

(e)      Termination of Employment. The Board shall determine the effect on an
         Award of the disability, death, retirement or other termination of
         employment of a Participant and the extent to which, and the period
         during which, the Participant's legal representative, guardian or
         Designated Beneficiary may receive payment of an Award or exercise
         rights thereunder.

(f)      Change in Control. In order to preserve a Participant's rights under an
         Award in the event of a change in control of the Company, the Board in
         its discretion may, at the time an Award is made or at any time
         thereafter, take one or more of the following actions: (i) provide for
         the acceleration of any time period relating to the exercise or
         realization of the Award, (ii) provide for the purchase of the Award
         upon the Participant's request for an amount of cash or other property
         that could have been received upon the exercise or realization of the
         Award had the Award been currently exercisable or payable, (iii) adjust
         the terms of the Award in a manner determined by the Board to reflect
         the change in control, (iv) cause the Award to be assumed, or new
         rights substituted therefor, by another entity, or (v) make such other
         provision as the Board may consider equitable and in the best interests
         of the Company.

(g)      Withholding. The Participant shall pay to the Company, or make
         provision satisfactory to the Board for payment of, any taxes required
         by law to be withheld in respect of Awards under the Plan no later than
         the date of the event creating the tax liability. In the Board's
         discretion, such tax obligations may be paid in whole or in part in
         shares of Common Stock, including shares retained from the Award
         creating the tax obligation, valued at their Fair Market Value on the
         date of delivery. The Company and its Affiliates may, to the extent
         permitted by law, deduct any such tax obligations from any payment of
         any kind otherwise due to the Participant.

(h)      Foreign Nationals. Awards may be made to Participants who are foreign
         nationals or employed outside the United States on such terms and
         conditions different from those specified in the Plan as the Board
         considers necessary or advisable to achieve the purposes of the Plan or
         comply with applicable laws.

(i)      Amendment of Award. The Board may amend, modify or terminate any
         outstanding Award, including substituting therefor another Award of the
         same or a different type, changing the date of exercise or realization
         and convening an Incentive Stock Option to a Nonstatutory Stock Option,
         provided that the Participant's consent to such action shall be
         required unless the Board determines that the action, taking into
         account any related action, would not materially and adversely affect
         the Participant.

Section 12.  Miscellaneous

(a)      No Right To Employment. No person shall have any claim or right to be
         granted an Award, and the grant of an Award shall not be construed as
         giving a Participant the right to continued employment. The Company
         expressly reserves the right at any time to dismiss a Participant free
         from any liability or claim under the Plan, except as expressly
         provided in the applicable Award.

(b)      No Rights As Shareholder. Subject to the provisions of the applicable
         Award, no Participant or Designated Beneficiary shall have any rights
         as a shareholder with respect to any shares of Common Stock to be
         distributed under the Plan until he or she becomes the holder thereof.
         A

                                      -6-
<PAGE>   7
         Participant to whom Common Stock is awarded shall be considered the
         holder of the Stock at the time of the Award except as otherwise
         provided in the applicable Award.

(c)      Effective Date. Subject to the approval of the shareholders of the
         Company, the Plan shall be effective on October 8, 1996. Prior to such
         approval, Awards may be made under the Plan expressly subject to such
         approval.

(d)      Amendment of Plan. The Board may amend, suspend or terminate the Plan
         or any portion thereof at any time, provided that no amendment shall be
         made without shareholder approval if such approval is necessary to
         comply with any applicable tax requirement.

(e)      Governing Law. The provisions of the Plan shall be governed by and
         interpreted in accordance with the laws of the State of Delaware.

                                      -7-

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