Document:

ADVANCED AERODYNAMICS & STRUCTURES, INC

SYS TECHNOLOGIES,
INC.

2003 STOCK OPTION
PLAN

1.         PURPOSE.  This
Stock Option Plan (the "Plan") is intended to serve as an incentive
to, and to encourage stock ownership by, certain eligible participants
rendering services to SYS Technologies, Inc., a California corporation (the
"Corporation"), and certain affiliates as set forth below, so that
they may acquire or increase their proprietary interest in the Corporation.

2.         ADMINISTRATION.

           
2.1       Committee.  The Plan shall be administered by the Board
of Directors of the Corporation (the "Board of Directors") or a
committee of two or more members appointed by the Board of Directors (the
"Committee") who are Non-Employee Directors as defined in Rule 16b-3
promulgated under Section 16 of the Securities Exchange Act of 1934 and outside
directors as defined in Treasury Regulation Section 1.162-27(e)(3).  The Committee shall select one of its
members as Chairman and shall appoint a Secretary, who need not be a member of
the Committee.  The Committee shall hold
meetings at such times and places as it may determine and minutes of such
meetings shall be recorded.  Acts by a
majority of the Committee in a meeting at which a quorum is present and acts
approved in writing by a majority of the members of the Committee shall be
valid acts of the Committee.

           
2.2       Term.  If the Board of Directors selects a Committee, the members of the
Committee shall serve on the Committee for the period of time determined by the
Board of Directors and shall be subject to removal by the Board of Directors at
any time.  The Board of Directors may
terminate the function of the Committee at any time and resume all powers and
authority previously delegated to the Committee.

           
2.3       Authority.  The Committee shall have sole discretion and
authority to grant options under the Plan to eligible participants rendering
services to the Corporation or any "parent" or "subsidiary"
of the Corporation, as defined in Section 424 of the Internal Revenue Code of
1986, as amended (the "Code") ("Parent or Subsidiary"), at
such times, under such terms and in such amounts as it may decide.  For purposes of this Plan and any Stock
Option Agreement (as defined below), the term "Corporation" shall
include any Parent or Subsidiary, if applicable.  Subject to the express provisions of the Plan, the Committee
shall have complete discretion and authority to interpret the Plan, to
prescribe, amend and rescind the rules and regulations relating to the Plan, to
determine the details and provisions of any Stock Option Agreement, to accelerate
any options granted under the Plan and to make all other determinations
necessary or advisable for the administration of the Plan.

           
2.4       Type of Option.  The Committee shall have full authority and
discretion to determine, and shall specify, whether the eligible individual
will be granted options intended to qualify as incentive options under Section
422 of the Code ("Incentive Options") or options which are not
intended to qualify under Section 422 of the Code ("Non-Qualified Options");
provided, however, that Incentive Options shall only be granted to employees of
the Corporation, or a Parent or Subsidiary thereof, and shall be subject to the
special limitations set forth herein attributable to Incentive Options.

Page 1

           
2.5       Interpretation.  The interpretation and construction by the
Committee of any provisions of the Plan or of any option granted under the Plan
shall be final and binding on all parties having an interest in this Plan or
any option granted hereunder.  No member
of the Committee shall be liable for any action or determination made in good
faith with respect to the Plan or any option granted under the Plan.

3.         ELIGIBILITY.

           
3.1       General.  All directors, officers, employees of and certain persons
rendering services to the Corporation, or any Parent or Subsidiary, relative to
the Corporation's, or any Parent's or Subsidiaries', management, operation or
development shall be eligible to receive options under the Plan.  The selection of recipients of options shall
be within the sole and absolute discretion of the Committee.  No person shall be granted an option under
this Plan unless such person has executed the grant representation letter set
forth on Exhibit "A," as such Exhibit may be amended by the Committee
from time to time and no person shall be granted an Incentive Option under this
Plan unless such person is an employee of the Corporation, or a Parent or
Subsidiary, on the date of grant.  .

           
3.2       Termination of Eligibility.

                       
3.2.1    If an optionee ceases to be employed by the
Corporation, or its Parent or Subsidiary, is no longer an officer or member of
the Board of Directors of the Corporation or no longer performs services for
the Corporation, or its Parent or Subsidiary for any reason (other than for
"cause," as hereinafter defined, or such optionee's death), any
option granted hereunder to such optionee shall expire three months after the
date the occurrence giving rise to such termination of eligibility (or 1 year
in the event an optionee is "disabled," as defined in Section 22(e)(3)
of the Code) or upon the date it expires by its terms, whichever is
earlier.  Any option that has not vested
in the optionee as of the date of such termination shall immediately expire and
shall be null and void.  The Committee
shall, in its sole and absolute discretion, decide, utilizing the provisions
set forth in Treasury Regulations Section 1.421-7(h), whether an authorized
leave of absence or absence for military or governmental service, or absence
for any other reason, shall constitute termination of eligibility for purposes
of this Section.

                       
3.2.2    If an optionee ceases to be employed by the
Corporation, or its Parent or Subsidiary, is no longer an officer or member of
the Board of Directors of the Corporation, or no longer performs services for
the Corporation, or its Parent or Subsidiary and such termination is as a
result of "cause," as hereinafter defined, then all options granted
hereunder to such optionee shall expire on the date of the occurrence giving
rise to such termination of eligibility or upon the date it expires by its
terms, whichever is earlier, and such optionee shall have no rights with
respect to any unexercised options.  For
purposes of this Plan, "cause" shall mean an optionee's personal dishonesty,
misconduct, breach of fiduciary duty, incompetence, intentional failure to
perform stated obligations, willful violation of any law, rule, regulation or
final cease and desist order, or any material breach of any provision of this
Plan, any Stock Option Agreement or any employment agreement.  The Board of Directors shall have complete
discretion and authority to determine whether the termination of the optionee
is for cause.

Page 2

           
3.3       Death of Optionee and Transfer Option.  In the event an optionee shall die, an
option may be exercised (subject to the condition that no option shall be
exercisable after its expiration and only to the extent that the optionee's
right to exercise such option had accrued at the time of the optionee's death)
at any time after the optionee's death by the executors or administrators of
the optionee or by any person or persons who shall have acquired the option
directly from the optionee by bequest or inheritance but not later than the
expiration of the option in accordance with its terms.  Except as otherwise provided in any Stock
Option Agreement, any option that has not vested in the optionee as of the date
of death or termination of employment, whichever is earlier, shall immediately
expire and shall be null and void.  No
option shall be transferable by the optionee other than by will or the laws of
descent and distribution.

           
3.4       Limitation on Incentive Options.  No person shall be granted any Incentive
Option to the extent that the aggregate fair market value of the Stock (as
defined below) to which such options are exercisable for the first time by the
optionee during any calendar year (under all plans of the Corporation as
determined under Section 422(d) of the Code) exceeds $100,000.

4.         IDENTIFICATION OF STOCK.  The Stock, as defined herein, subject to the options shall be
shares of the Corporation's authorized but unissued or acquired or reacquired
common stock (the "Stock"). 
The aggregate number of shares subject to outstanding options shall not
exceed  one million five hundred
thousand (1,500,000) shares of Stock (subject to adjustment as provided in
Section 6).  If any option granted
hereunder shall expire or terminate for any reason without having been
exercised in full, the unpurchased shares subject thereto shall again be available
for purposes of this Plan.

5.         TERMS AND CONDITIONS OF OPTIONS.  Any option granted pursuant to the Plan
shall be evidenced by an agreement ("Stock Option Agreement") in such
form as the Committee shall from time to time determine, which agreement shall
comply with and be subject to the following terms and conditions:

           
5.1      Number of Shares.  Each option shall state the number of shares
of Stock to which it pertains.

           
5.2      Option Exercise Price.  Each option shall state the option exercise
price, which shall be determined by the Committee; provided, however, that (i)
the exercise price of any Incentive Option shall not be less than the fair
market value of the Stock, as determined by the Committee, on the date of grant
of such option, (ii) the exercise price of any Incentive Option granted to an
employee who owns more than 10% of the total combined voting power of all
classes of the Corporation's stock, as determined for purposes of Section 422
of the Code, shall not be less than 110% of the fair market value of the Stock,
as determined by the Committee, on the date of grant of such option, and (iii)
the exercise price of any Non-Qualified Option shall not be less than 100% of
the fair market value of the Stock, as determined by the Committee, on the date
of grant of such option.

           
5.3      Term of Option.  The term of an option granted hereunder
shall be determined by the Committee at the time of grant, but shall not exceed
ten years from the date of the grant. 
The term of any Incentive Option granted to an employee who owns more
than 10% of the total combined voting power of all classes of the Corporation's
stock, as determined for purposes of Section 422 of the Code, shall in no event
exceed five years from the date of grant. 
All options shall be subject to early termination as set forth in this Plan.  In no event shall any option be exercisable
after the expiration of its term.

Page 3

           
5.4       Method of Exercise.  An option shall be exercised by written
notice (Exhibit " A") to the Corporation by the optionee (or
successor in the event of death).  Such
written notice shall state the number of shares with respect to which the
option is being exercised and designate a time, during normal business hours of
the Corporation, for the delivery thereof ("Exercise Date"), which
time shall be at least 30 days after the giving of such notice unless an
earlier date shall have been mutually agreed upon.  At the time specified in the written notice, the Corporation
shall deliver to the optionee at the principal office of the Corporation, or
such other appropriate place as may be determined by the Committee, a
certificate or certificates for such shares. 
Notwithstanding the foregoing, the Corporation may postpone delivery of
any certificate or certificates after notice of exercise for such reasonable
period as may be required to comply with any applicable listing requirements of
any securities exchange.  In the event
an option shall be exercisable by any person other than the optionee, the
required notice under this Section shall be accompanied by appropriate proof of
the right of such person to exercise the option.

           
5.5       Medium and Time of Payment.  The option exercise price shall be payable
in full on or before the option Exercise Date in any one of the following
alternative forms:

                       
5.5.1       
Full payment in cash or certified bank or cashier's check;

                       
5.5.2    Full payment in shares of Stock other
securities of the Corporation having a fair market value on the Exercise Date
in the amount equal to the option exercise price;

                       
5.5.3    A combination of the consideration set forth
in Sections 5.5.1, 5.5.2 and 5.5.3 equal to the option exercise price; or

                       
5.5.4    Any other method of payment complying with
the provisions of Section 422 of the Code with respect to Incentive Options,
including, but not limited to, the delivery by optionee of an irrevocable
direction to a securities broker approved by the Corporation to sell the Stock
and to deliver all or part of the sales proceeds to the Corporation in payment
of all or part of the exercise price and any withholding taxes; provided that
the terms of payment are established by the Committee at the time of grant and
any other method of payment established by the Committee with respect to
Non-Qualified Options.

           
5.6       Fair Market Value.  The fair market value of a share of Stock or
other security of the Corporation on any relevant date shall be determined in
accordance with the following provisions:

                       
5.6.1    If the Stock or other security of the
Corporation at the time is neither listed nor admitted to trading on any stock
exchange nor traded in the over-the-counter market, then the fair market value
shall be determined by the Committee after taking into account such factors as
the Committee shall deem appropriate.

Page 4

                       
5.6.2    If the Stock or other security of the
Corporation is not at the time listed or admitted to trading on any stock
exchange but is traded in the over-the-counter market, the fair market value
shall be the mean between the highest bid and lowest asked prices (or, if such
information is available, the closing selling price) of one share of Stock or other
security of the Corporation on the 30 days preceeding the date of the grant in
question in the over-the-counter market, as such prices are reported by the
National Association of Securities Dealers through its NASDAQ system or any
successor system.  If there are no
reported bid and asked prices (or closing selling price) for the Stock or other
security of the Corporation on the date in question, then the mean between the
highest bid price and lowest asked price (or the closing selling price) on the
last preceding date for which such quotations exist shall be determinative of
fair market value. 

                       
5.6.3    If the Stock or other security of the
Corporation is at the time listed or admitted to trading on any stock exchange,
then the fair market value shall be the closing selling price of one share of
Stock or other security of the Corporation on the date in question on the stock
exchange determined by the Committee to be the primary market for the Stock or
other security of the Corporation, as such price is officially quoted in the
composite tape of transactions on such exchange.  If there is no reported sale of Stock or other security of the
Corporation on such exchange on the date in question, then the fair market
value shall be the closing selling price on the exchange on the last preceding
date for which such quotation exists.

           
5.7       Rights as a Shareholder.  An optionee or successor shall have no
rights as a shareholder with respect to any Stock underlying any option until
the date of the issuance to such optionee of a certificate for such Stock.  No adjustment shall be made for dividends
(ordinary or extraordinary, whether in cash, securities or other property) or
distributions or other rights for which the record date is prior to the date
such Stock certificate is issued, except as provided in Section 6.

           
5.8       Modification, Extension and Renewal of
Options.  Subject to the terms and
conditions of the Plan, the Committee may modify, extend or renew outstanding
options granted under the Plan, or accept the surrender of outstanding options
(to the extent not exercised) and authorize the granting of new options in
substitution therefor.

           
5.9       Vesting and Restrictions.  The Committee shall have complete authority
and discretion to set the terms, conditions, restrictions, vesting schedules
and other provisions of any option in the applicable Stock Option Agreement and
shall have complete authority to require conditions and restrictions on any
Stock issued pursuant to this Plan.

           
5.10     Other Provisions.  The Stock Option Agreements shall contain
such other provisions, including without limitation, restrictions or conditions
upon the exercise of options, as the Committee shall deem advisable.

6.         ADJUSTMENTS UPON CHANGES IN CAPITALIZATION.

           
6.1       Subdivision or Consolidation.  Subject to any required action by
shareholders of the Corporation, the number of shares of Stock covered by each
outstanding option, and the exercise price thereof, shall be proportionately
adjusted for any increase or decrease in the number of issued shares of Stock
of the Corporation resulting from a subdivision or consolidation of shares
including, but not limited to, a stock split, reverse stock split,
recapitalization, continuation or reclassification, or the payment of a stock
dividend (but only on the Stock) or any other increase or decrease in the
number of such shares effected without receipt of consideration by the
Corporation.  Any fraction of a share
subject to option that would otherwise result from an adjustment pursuant to
this Section shall be rounded downward to the next full number of shares
without other compensation or consideration to the holder of such option.

Page 5

           
6.2       Capital Transactions.  Upon a sale or exchange of all or
substantially all of the assets of the Corporation, a merger or consolidation
in which the Corporation is not the surviving corporation, a merger,
reorganization or consolidation in which the Corporation is the surviving
corporation and shareholders of the Corporation exchange their stock for
securities or property, a liquidation of the Corporation or similar transaction
as determined by the Committee ("Capital Transaction"), this Plan and
each option issued under this Plan, whether vested or unvested, shall terminate
immediately prior to such Capital Transaction, unless such options are assumed
by a successor corporation in a merger or consolidation; provided, however,
that unless the outstanding options are assumed by a successor corporation in a
merger or consolidation, subject to terms approved by the Committee, all optionees
will have the right, during the 30 days prior to such Capital Transaction, to
exercise all vested options. 
Notwithstanding the foregoing, in the event there is a merger or
consolidation where the Corporation is not the surviving corporation, all options
granted under this Plan shall vest 30 days prior to such merger or
consolidation unless such options are assumed by the successor corporation in
such merger or consolidation.  The
Corporation shall, subject to any nondisclosure provisions, attempt to provide
optionees at least 30 days notice of the option termination date.  The Committee may (but shall not be
obligated to) (i) accelerate the vesting of any option or (ii) apply the
foregoing provisions, including but not limited to termination of this Plan and
any options granted pursuant to the Plan, in the event there is a sale of 51%
or more of the stock of the Corporation in any two year period or a transaction
similar to a Capital Transaction.

           
6.3       Adjustments.  To the extent that the foregoing adjustments
relate to stock or securities of the Corporation, such adjustments shall be
made by the Committee, whose determination in that respect shall be final,
binding and conclusive.

           
6.4       Ability to Adjust.  The grant of an option pursuant to the Plan
shall not affect in any way the right or power of the Corporation to make
adjustments, reclassifications, reorganizations or changes of its capital or
business structure or to merge, consolidate, dissolve, liquidate, sell or
transfer all or any part of its business or assets.

           
6.5       Notice of Adjustment.  Whenever the Corporation shall take any
action resulting in any adjustment provided for in this Section, the
Corporation shall forthwith deliver notice of such action to each optionee,
which notice shall set forth the number of shares subject to the option and the
exercise price thereof resulting from such adjustment.

           
6.6       Limitation on Adjustments.  Any adjustment, assumption or substitution
of an Incentive Option shall comply with Section 425 of the Code, if applicable.

7.         NONASSIGNABILITY. 
Options granted under this Plan may not be sold, pledged, assigned or
transferred in any manner other than by will or by the laws of intestate
succession, and may be exercised during the lifetime of an optionee only by such
optionee.  Any transfer by the optionee
of any option granted under this Plan in violation of this Section shall void
such option and any Stock Option Agreement entered into by the optionee and the
Corporation regarding such transferred option shall be void and have no further
force or effect.  No option shall be
pledged or hypothecated in any way, nor shall any option be subject to
execution, attachment or similar process.

Page 6

8.         NO RIGHT OF EMPLOYMENT.  Neither the grant nor exercise of any option nor anything in this
Plan shall impose upon the Corporation or any other corporation any obligation
to employ or continue to employ any optionee. 
The right of the Corporation and any other corporation to terminate any
employee shall not be diminished or affected because an option has been granted
to such employee.

9.         TERM OF PLAN. 
This Plan is effective on the date the Plan is adopted by the Board of
Directors and options may be granted pursuant to the Plan from time to time
within a period of ten (10) years from such date, or the date of any required
shareholder approval required under the Plan, if earlier.  Termination of the Plan shall not affect any
option theretofore granted.

10.       AMENDMENT OF THE PLAN.  The Board of Directors of the Corporation
may, subject to any required shareholder approval, suspend, discontinue or
terminate the Plan, or revise or amend it in any respect whatsoever with
respect to any shares of Stock at that time not subject to options.

11.       APPLICATION OF FUNDS.  The proceeds received by the Corporation
from the sale of Stock pursuant to options may be used for general corporate
purposes.

12.       RESERVATION OF SHARES.  The Corporation, during the term of this
Plan, shall at all times reserve and keep available such number of shares of
Stock as shall be sufficient to satisfy the requirements of the Plan.

13.       NO OBLIGATION TO EXERCISE OPTION.  The granting of an option shall not impose
any obligation upon the optionee to exercise such option.

14.       APPROVAL OF BOARD OF DIRECTORS AND
SHAREHOLDERS.  The Plan shall not
take effect until approved by the Board of Directors of the Corporation.  This Plan shall be approved by a vote of the
shareholders within 12 months from the date of approval by the Board of
Directors.  In the event such shareholder
vote is not obtained, all options granted hereunder, whether vested or
unvested, shall be null and void.

15.       WITHHOLDING TAXES.  Notwithstanding anything else to the
contrary in this Plan or any Stock Option Agreement, the exercise of any option
shall be conditioned upon payment by such optionee in cash, or other provisions
satisfactory to the Committee, of all local, state, federal or other
withholding taxes applicable, in the Committee's judgment, to the exercise or
to later disposition of shares acquired upon exercise of an option (including
any repurchase of an option or the Stock).

16.       PARACHUTE PAYMENTS.  Any outstanding option under the Plan may
not be accelerated to the extent any such acceleration of such option would,
when added to the present value of other payments in the nature of compensation
which becomes due and payable to the optionee would result in the payment to
such optionee of an excess parachute payment under Section 280G of the
Code.  The existence of any such excess
parachute payment shall be determined in the sole and absolute discretion of
the Committee.

Page 7

17.       SECURITIES LAWS COMPLIANCE.  Notwithstanding anything contained herein,
the Corporation shall not be obligated to grant any option under this Plan or
to sell, issue or effect any transfer of any Stock unless such grant, sale,
issuance or transfer is at such time effectively (i) registered or exempt from
registration under the Act and (ii) qualified or exempt from qualification
under the California Corporate Securities Law of 1968 and any other applicable
state securities laws.  As a condition
to exercise of any option, each optionee shall make such representations as may
be deemed appropriate by counsel to the Corporation for the Corporation to use
any available exemption from registration under the Act or any applicable state
securities law.

18.       RESTRICTIVE LEGENDS.  The certificates representing the Stock
issued upon exercise of options granted pursuant to this Plan will bear any
legends required by applicable state or federal securities laws as determined
by the Committee.

19.       NOTICES.  Any notice to be given under the terms of the Plan shall be
addressed to the Corporation in care of its Secretary at its principal office,
and any notice to be given to an optionee shall be addressed to such optionee
at the address maintained by the Corporation for such person or at such other
address as the optionee may specify in writing to the Corporation.

           
As
adopted by the Board of Directors as of ________________________, 2003

                                                                               
SYS Technologies, Inc., a California

                                                                               
corporation

 

                                                                               
By:_______________________________

                                                                                    
_______________________________

                                                                                    
_______________________________

        

            Approved by the Company's shareholders on
__________________, 2003.

 

Page 8

  NON-QUALIFIED STOCK OPTION AGREEMENT

  

      THIS NON-QUALIFIED STOCK OPTION AGREEMENT
  ("Agreement") is made by and between SYS Technologies, Inc., a
  California corporation (the "Corporation"), and
  ______________________________ (the "Optionee").

      NOW, THEREFORE, in consideration of the mutual benefit
  to be derived herefrom, the Corporation and Optionee agree as follows:

      1.    Grant of Option.  The
  Corporation hereby grants to Optionee, subject to all the terms and provisions
  of the SYS Technologies, Inc, 2003 Stock Option Plan dated __________, 2003,
  as such Plan may be hereinafter amended, a copy of which is attached hereto
  and incorporated herein by this reference (the "Plan"), the right,
  privilege and option ("Option") to purchase _____ shares of its
  common stock ("Stock") at __________ per share, in the manner and
  subject to the conditions provided hereinafter and in the Plan and any
  amendments thereto and any rules and regulations thereunder.

      2.    Time of Exercise of Option. 
  The Option shall vest in Optionee and may be exercised by Optionee as follows:

                             
  Date                            
  %                                            
  # of Shares

                             
                                     
                                                 
                         

                             
                                     
                                                 
                         

                             
                                     
                                                 
                         

                             
                                     
                                                 
                         

                             
                                     
                                                 
                         

      Except as otherwise provided in the Plan, including, but
  not limited to, Section 3.2.2, such Option must be exercised within the
  earlier of (i) 10 years after the date of the grant, or (ii) three
  months after Optionee's termination of employment with either the Corporation,
  or a Parent or Subsidiary thereof; provided, however, such rights shall be
  extended as more fully set forth in Section 3.3 of the Plan in the case
  of Optionee's death.  In no event shall the Corporation be required to
  transfer fractional shares to Optionee or those entitled to Optionee's rights
  herein.

      3.    Method of Exercise.  An
  option shall be exercised by written notice (Exhibit "B") to the
  Corporation by the optionee (or successor in the event of death).  The
  Option shall be exercised by Optionee as set forth in Sections 5.4 and
  5.5 of the Plan, including, but not limited to, a cashless exercise, as
  described in Section 5.5.5 of the Plan.

  Page 1

  

  

      4.    Restrictions on Exercise and
  Delivery.  The exercise of each Option shall be subject to the
  condition that, if at any time the Committee shall determine, in its sole and
  absolute discretion,

             
  (a)    the satisfaction of any withholding tax or other
  withholding liabilities, is necessary or desirable as a condition of, or in
  connection with, such exercise or the delivery or purchase of Stock pursuant
  thereto,

             
  (b)    the listing, registration, or qualification of any
  shares deliverable upon such exercise is desirable or necessary, under any
  state or federal law, as a condition of, or in connection with, such exercise
  or the delivery or purchase of shares pursuant thereto, or

             
  (c)    the consent or approval of any regulatory body is
  necessary or desirable as a condition of, or in connection with, such exercise
  or the delivery or purchase of shares pursuant thereto,

  then in any such event, such exercise shall not be effective unless such
  withholding, listing, registration, qualification, consent or approval shall
  have been effected or obtained free of any conditions not acceptable to the
  Committee.  Optionee shall execute such documents and take such other
  actions as are required by the Committee to enable it to effect or obtain such
  withholding, listing, registration, qualification, consent or approval. 
  Neither the Corporation nor any officer or director, or member of the
  Committee, shall have any liability with respect to the non-issuance or
  failure to sell shares as the result of any suspensions of exercisability
  imposed pursuant to this Section.

      5.    Termination of Option. 
  Except as otherwise provided in this Agreement or the Plan, to the extent not
  previously exercised, the Option shall terminate upon the first to occur of
  any of the following events:

             
  (a)    the dissolution or liquidation of the Corporation;

             
  (b)    the expiration of 10 years from the date of the grant of
  the Option hereunder;

             
  (c)    the breach by Optionee of any provision of this
  Agreement;

             
  (d)    as more fully set forth in Section 3.2.1 of the
  Plan, three months after termination of employment other than for
  "cause;"

             
  (e)    as more fully set forth in Section 3.2.2 of the
  Plan, upon or as of the occurrence of an event giving rise to termination of
  employment for "cause;"

             
  (f)    as more fully set forth in Section 6.2 of the Plan,
  in the event of a Capital Transaction.

  Page 2

  

  

      6.    Nonassignability. 
  Options may not be sold, pledged, assigned or transferred in any manner other
  than by will or by the laws of intestate succession, and may be exercised
  during the lifetime of Optionee only by Optionee.  Any transfer by
  Optionee of any Option granted under the Plan or this Agreement shall void
  such Option and the Corporation shall have no further obligation with respect
  to such Option.  No Option shall be pledged or hypothecated in any way,
  nor shall any Option be subject to execution, attachment or similar process.

      7.    Restrictions on Transfer of
  Shares Acquired.  Optionee represents and warrants to the Corporation
  that he will not transfer the Stock in violation of the provisions of any
  applicable securities statute or regulation.

      8.    Representation Letter. 
  Upon the grant of the Option and execution of this Agreement, the Optionee
  will deliver to the Corporation the grant representation letter set forth on
  Exhibit "A" of the Plan, as such Exhibit may be amended by
  the Committee from time to time.  Optionee also agrees to make such other
  representations as are deemed necessary or appropriate by the Corporation and
  its counsel.

      9.    Restrictive Legends. 
  Each certificate evidencing the shares acquired hereunder, including any
  certificate issued to any transferee thereof, shall be imprinted with legends
  required by applicable state or federal securities law, as determined by the
  Committee.

      10.  Rights as Shareholder.  Neither
  Optionee nor his executor, administrator, heirs or legatees, shall be, or have
  any rights or privileges of a shareholder of the Corporation in respect of the
  Stock unless and until certificates representing such Stock shall have been
  issued in Optionee's name.

      11.  No Right of Employment.  Neither
  the grant nor exercise of any Option nor anything in the Plan or this
  Agreement shall impose upon the Corporation or any other corporation any
  obligation to employ or continue to employ any Optionee.  The right of
  the Corporation and any other corporation to terminate any employee shall not
  be diminished or affected because an Option has been granted to such employee.

      12.  Mandatory Arbitration.  In the
  event of any dispute between the Corporation and Optionee regarding this
  Agreement or the Plan, the dispute and any issue as to the arbitrability of
  such dispute, shall be settled to the exclusion of a court of law, by
  arbitration in San Diego, California, by a panel of three arbitrators
  (each party shall choose one arbitrator and the third shall be chosen by the
  two arbitrators so selected) in accordance with the Commercial Arbitration
  Rules of the American Arbitration Association then in effect.  The
  decision of a majority of the arbitrators shall be final and binding upon the
  parties.  All costs of the arbitration and the fees of the arbitrators
  shall be allocated between the parties as determined by a majority of the
  arbitrators, it being the intention of the parties that the prevailing party
  in such a proceeding be made whole with respect to its expenses.

      13.  Definitions.  Capitalized terms
  shall have the meaning set forth in the Plan unless otherwise defined herein.

      14.  Notices.  Any notice to be given
  under the terms of this Agreement shall be addressed to the Corporation in
  care of its Secretary at its principal office, and any notice to be given to
  Optionee shall be addressed to such Optionee at the address maintained by the
  Corporation for such person or at such other address as the Optionee may
  specify in writing to the Corporation.

  Page 3

  

  

      15.  Binding Effect.  This Agreement
  shall be binding upon and inure to the benefit of Optionee, his heirs and
  successors, and of the Corporation, its successors and assigns.

      16.  Governing Law.  This Agreement
  shall be governed by the laws of the State of California.

      17.  Descriptive Headings.  Titles to
  Sections are solely for information purposes.

      18.  Application of Plan.  The
  Corporation has delivered and the Optionee hereby acknowledges receipt of a
  copy of the Plan.  The parties agree and acknowledge that the Option
  granted hereunder is granted pursuant to the Plan and subject to the terms and
  provisions thereof, and the rights of the Optionee are subject to
  modifications and termination in certain events as provided in the Plan.

      IN WITNESS WHEREOF, this Agreement is effective as of,
  and the date of grant shall be, _______________________, 2003.

  		
        CORPORATION

        

        SYS Technologies, Inc.,

        a California corporation

        By:                                                                     

                 Its:                                                            

        OPTIONEE

                                                                                  

      

Page 4

  INCENTIVE STOCK OPTION AGREEMENT

  

      THIS INCENTIVE STOCK OPTION AGREEMENT
  ("Agreement") is made by and between SYS Technologies, Inc., a
  California corporation, (the "Corporation"), and _________________
  (the "Optionee").

      NOW, THEREFORE, in consideration of the mutual benefit
  to be derived herefrom, the Corporation and Optionee agree as follows:

      1.    Grant of Option.  The
  Corporation hereby grants to Optionee, subject to all the terms and provisions
  of the SYS Technologies, Inc., 2003 Stock Option Plan dated
  __________________, 2003 as such Plan may be hereinafter amended, a copy of
  which is attached hereto and incorporated herein by this reference (the
  "Plan"), the right, privilege and option ("Option") to
  purchase _________ shares of its common stock ("Stock") at _________
  per share, in the manner and subject to the conditions provided hereinafter
  and in the Plan and any amendments thereto and any rules and regulations
  thereunder.

      2.    Time of Exercise of Option. 
  The Option shall vest  and may be exercised by Optionee as follows:

                                
  Date                              
  %                                      
  # of Shares

                                
  _____                           
  _____                               
  ____________

                                
  _____                           
  _____                               
  ____________ 

                                
  _____                           
  _____                               
  ____________

                                
  _____                           
  _____                               
  ____________

                                
  _____                           
  _____                               
  ____________

   

      Except as otherwise provided in the Plan, including, but
  not limited to, Section 3.2.2, such Option must be exercised within the
  earlier of (i) 10 years (5 years for 10% shareholders as defined in the
  Plan) after the date of the grant, or (ii) three months after Optionee's
  termination of employment with either the Corporation, or a Parent or
  Subsidiary thereof; provided, however, such rights shall be extended as more
  fully set forth in Section 3.3 of the Plan in the case of Optionee's
  death.  In no event shall the Corporation be required to transfer
  fractional shares to Optionee or those entitled to Optionee's rights herein.

      3.    Method of Exercise.  An
  option shall be exercised by written notice (Exhibit "B") to the
  Corporation by the optionee (or successor in the event of death).  The
  Option shall be exercised by Optionee as set forth in Sections 5.4 and
  5.5 of the Plan, including, but not limited to, a cashless exercise, as
  described in Section 5.5.5 of the Plan.

  Page 1

  

      4.    Restrictions on Exercise and
  Delivery.  The exercise of each Option shall be subject to the
  condition that, if at any time the Committee shall determine, in its sole and
  absolute discretion,

             
  (a)    the satisfaction of any withholding tax or other
  withholding liabilities, is necessary or desirable as a condition of, or in
  connection with, such exercise or the delivery or purchase of Stock pursuant
  thereto,

             
  (b)    the listing, registration, or qualification of any
  shares deliverable upon such exercise is desirable or necessary, under any
  state or federal law, as a condition of, or in connection with, such exercise
  or the delivery or purchase of shares pursuant thereto, or

             
  (c)    the consent or approval of any regulatory body is
  necessary or desirable as a condition of, or in connection with, such exercise
  or the delivery or purchase of shares pursuant thereto,

  then in any such event, such exercise shall not be effective unless such
  withholding, listing, registration, qualification, consent or approval shall
  have been effected or obtained free of any conditions not acceptable to the
  Committee.  Optionee shall execute such documents and take such other
  actions as are required by the Committee to enable it to effect or obtain such
  withholding, listing, registration, qualification, consent or approval. 
  Neither the Corporation nor any officer or director, or member of the
  Committee, shall have any liability with respect to the non-issuance or
  failure to sell shares as the result of any suspensions of exercisability
  imposed pursuant to this Section.

      5.    Termination of Option. 
  Except as otherwise provided in this Agreement or the Plan, to the extent not
  previously exercised, the Option shall terminate upon the first to occur of
  any of the following events:

             
  (a)    the dissolution or liquidation of the Corporation;

             
  (b)    The expiration of 10 years (5 years for 10% shareholders
  as defined in the Plan) from the date of the grant of the Option hereunder;

             
  (c)    the breach by Optionee of any provision of this
  Agreement;

             
  (d)    as more fully set forth in Section 3.2.1 of the
  Plan, three months after termination of employment other than for
  "cause;"

             
  (e)    as more fully set forth in Section 3.2.2 of the
  Plan, upon or as of the occurrence of an event giving rise to termination of
  employment for "cause;"

             
  (f)    as more fully set forth in Section 6.2 of the Plan,
  in the event of a Capital Transaction.

  Page 2

  

  

      6.    Nonassignability. 
  Options may not be sold, pledged, assigned or transferred in any manner other
  than by will or by the laws of intestate succession, and may be exercised
  during the lifetime of Optionee only by Optionee.  Any transfer by
  Optionee of any Option granted under the Plan or this Agreement shall void
  such Option and the Corporation shall have no further obligation with respect
  to such Option.  No Option shall be pledged or hypothecated in any way,
  nor shall any Option be subject to execution, attachment or similar process.

      7.    Restrictions on Transfer of
  Shares Acquired.  Optionee represents and warrants to the Corporation
  that he will not transfer the Stock in violation of the provisions of any
  applicable securities statute or regulation.

      8.    Representation Letter. 
  Upon the grant of the Option and execution of this Agreement, the Optionee
  will deliver to the Corporation the grant representation letter set forth on
  Exhibit "A" of the Plan, as such Exhibit may be amended by the
  Committee from time to time.  Optionee also agrees to make such other
  representations as are deemed necessary or appropriate by the Corporation and
  its counsel.

      9.    Restrictive Legends. 
  Each certificate evidencing the shares acquired hereunder, including any
  certificate issued to any transferee thereof, shall be imprinted with legends
  required by applicable state or Federal securities law, as determined by the
  Committee.

      10.  Rights as Shareholder.  Neither
  Optionee or his executor, administrator, heirs or  legal representative,
  shall be, or have any rights or privileges of a shareholder of the Corporation
  in respect of the Stock unless and until certificates representing such Stock
  shall have been issued in Optionee's name.

      11.  No Right of Employment.  Neither
  the grant nor exercise of any Option nor anything in the Plan or this
  Agreement shall impose upon the Corporation or any other corporation any
  obligation to employ or continue to employ any Optionee.  The right of
  the Corporation and any other corporation to terminate any employee shall not
  be diminished or affected because an Option has been granted to such employee.

      12.  Mandatory Arbitration.  In the
  event of any dispute between the Corporation and Optionee regarding this
  Agreement or the Plan, the dispute and any issue as to the arbitrability of
  such dispute, shall be settled to the exclusion of a court of law, by
  arbitration in San Diego, California, by a panel of three arbitrators (each
  party shall choose one arbitrator and the third shall be chosen by the two
  arbitrators so selected) in accordance with the Commercial Arbitration Rules
  of the American Arbitration Association then in effect.  The decision of
  a majority of the arbitrators shall be final and binding upon the
  parties.  All costs of the arbitration and the fees of the arbitrators
  shall be allocated between the parties as determined by a majority of the
  arbitrators, it being the intention of the parties that the prevailing party
  in such a proceeding be made whole with respect to its expenses.

      13.  Definitions.  Capitalized terms
  shall have the meaning set forth in the Plan unless otherwise defined herein.

      14.  Notices.  Any notice to be given
  under the terms of this Agreement shall be addressed to the Corporation in
  care of its Secretary at its principal office, and any notice to be given to
  Optionee shall be addressed to such Optionee at the address maintained by the
  Corporation for such person or at such other address as the Optionee may
  specify in writing to the Corporation.

  Page 3

  

  

      15.  Binding Effect.  This Agreement
  shall be binding upon and inure to the benefit of Optionee, his heirs and
  successors, and of the Corporation, its successors and assigns.

      16.  Governing Law.  This Agreement
  shall be governed by the laws of the State of California.

      17.  Descriptive Headings.  Titles to
  Sections are solely for information purposes.

      18.  Application of Plan.  The
  Corporation has delivered and the Optionee hereby acknowledges receipt of a
  copy of the Plan.  The parties agree and acknowledge that the Option
  granted hereunder is granted pursuant to the Plan and subject to the terms and
  provisions thereof, and the rights of the Optionee are subject to
  modifications and termination in certain events as provided in the Plan.

      IN WITNESS WHEREOF, this Agreement is effective as of,
  and the date of grant shall be, ____________________, 2003.

  		
        CORPORATION

        SYS Technologies Inc.,

        a California corporation

        By:                                                                     

                 Its:                                                            

         

      
		
        OPTIONEE

                                                                                

      

Page 41999 Employee Stock Purchase Plan

SYS

2003 EMPLOYEE STOCK PURCHASE PLAN

        The following constitute the provisions of the 2003
Employee Stock Purchase Plan of SYS.

1.     Purpose. 
The purpose of the Plan is to provide employees of the Company and its
Designated Subsidiaries with an opportunity to purchase Common Stock of the
Company through accumulated payroll deductions.  It is the intention of the Company that the Plan qualify as an
"Employee Stock Purchase Plan" under Section 423 of the Internal
Revenue Code of 1986, as amended.  The
provisions of the Plan, accordingly, shall be construed so as to extend and
limit participation in a manner consistent with the requirements of that
section of the Code.

2.     Definitions.

        (a)   "Board" shall mean the Board of Directors of
the Company.  Any reference to the
"Board" in this Plan shall also be a reference to a committee
appointed by the Board of Directors of the Company to take actions on its
behalf with respect to the Plan.

        (b)   "Code" shall mean the Internal Revenue Code
of 1986, as amended.

        (c)   "Common Stock" shall mean the common stock of
the Company.

        (d)   "Company" shall mean SYS and any Designated
Subsidiary of the Company.

        (e)   "Compensation" shall mean all base straight
time gross earnings and commissions, but excluding payments for overtime, shift
premium, incentive compensation, incentive payments, bonuses, commissions,
allowances for moving, relocation or automobiles and other compensation.

        (f)    "Designated Subsidiary" shall mean any
Subsidiary which has been designated by the Board from time to time in its sole
discretion as eligible to participate in the Plan.

        (g)   "Employee" shall mean any individual who is
an employee of the Company for tax purposes. 
For purposes of the Plan, the employment relationship shall be treated
as continuing intact while the individual is on sick leave or other leave of
absence approved by the Company.  Where
the period of leave exceeds 90 days and the individual's right to reemployment
is not guaranteed either by statute or by contract, the employment relationship
shall be deemed to have terminated on the 91st day of such leave.

        (h)   "Enrollment Date" shall mean the first day of
each Offering Period.

        (i)    "Exercise Date" shall mean the last day of
each Offering Period.

Page 1

        (j)    "Fair Market Value" shall mean, as of any
date, the value of Common Stock determined as follows:

               
(1)    If the Common Stock at the time is neither listed nor
admitted to trading on any stock exchange nor traded in the over-the-counter
market, then the fair market value shall be the value of the stock as
determined by the Board in their last valuation of the Common Stock, after
taking into account such factors as the Board of Directors shall deem
appropriate.

               
(2)    If the Common Stock is not at the time listed or
admitted to trading on any stock exchange but is traded in the over-the-counter
market, the fair market value shall be the mean between the highest bid and
lowest asked prices (or, if such information is available, the closing selling
price) of one share of Common Stock on the date in question in the
over-the-counter market, as such prices are reported by the National
Association of Securities Dealers through its NASDAQ system or any successor
system.  If there are no reported bid
and asked prices (or closing selling price) for the Common Stock on the date in
question, then the mean between the highest bid price and lowest asked price
(or the closing selling price) on the last preceding date for which such
quotations exist shall be determinative of fair market value.

               
(3)    If the Common Stock is at the time listed or admitted
to trading on any stock exchange, then the fair market value shall be the
closing selling price of one share of Common Stock on the date in question on
the stock exchange determined by the Board to be the primary market for the
Common Stock, as such price is officially quoted in the composite tape of
transactions on such exchange.  If there
is no reported sale of Common Stock on such exchange on the date in question,
then the fair market value shall be the closing selling price on the exchange
on the last preceding date for which such quotation exists.

        (k)   "Offering Period" shall mean a period of
approximately six (6) months during which a Purchase Right granted pursuant to
the Plan may be exercised, commencing on the first Trading Day on or after
January 1 and terminating on the last Trading Day in the period ending the
following June 30, or commencing on the first Trading Day on or after July 1
and terminating on the last Trading Day in the period ending the following
December 31; provided, however, that the first Offering Period under the Plan
will commence on the first Trading Day on or after the later of January 1, 2003
or the effective date of the Company's Registration Statement with respect to
the Plan.  The duration of Offering
Periods may be changed pursuant to Section 4 of this Plan.

        (l)     "Plan" shall mean this 2003 SYS Employee
Stock Purchase Plan.

        (m)   "Purchase Price" shall mean 85% of the Fair
Market Value of a share of Common Stock on the Enrollment Date or on the
Exercise Date, whichever is lower; provided, however, that the Purchase Price
may be adjusted by the Board pursuant to Section 20.

Page 2

        (n)    "Purchase Right" means the right to purchase
shares of Common Stock granted pursuant to the Plan.

        (o)    "Reserves" shall mean the number of shares of
Common Stock covered by each Purchase Right under the Plan which has not yet
been exercised and the number of shares of Common Stock which have been
authorized for issuance under the Plan but not yet placed under a Purchase
Right.

        (p)    "Subsidiary" shall mean a corporation,
domestic or foreign, of which not less than 50% of the voting shares are held
by the Company or a Subsidiary, whether or not such corporation now exists or
is hereafter organized or acquired by the Company or a Subsidiary.

        (q)    "Trading Day" shall mean a day on which national
stock exchanges and the Nasdaq System are open for trading.

3.     Eligibility.

        (a)    Except as provided in (b), below, any Employee who
shall be employed by the Company on a given Enrollment Date shall be eligible
to participate in the Plan.

        (b)    Any provisions of the Plan to the contrary
notwithstanding, no Employee shall be granted a Purchase Right under the Plan
(i) to the extent that, immediately after the grant, such Employee (or any
other person whose stock would be attributed to such Employee pursuant to Section 424(d) of
the Code) would own capital stock of the Company and/or hold outstanding
Purchase Rights to purchase such stock possessing five percent (5%) or more of
the total combined voting power or value of all classes of the capital stock of
the Company or of any Subsidiary, or (ii) to the extent that his or her
rights to purchase stock under all employee stock purchase plans of the Company
and its Subsidiaries accrues at a rate which exceeds Twenty-Five Thousand
Dollars ($25,000) worth of stock (determined at the Fair Market Value of the
shares at the time such Purchase Right is granted) for each calendar year in
which such Purchase Right is outstanding at any time.

4.     Offering Periods.  The Plan shall be implemented by consecutive Offering Periods
with a new Offering Period commencing on the first Trading Day on or after
January 1 and July 1 each year, or on such other date as the Board
shall determine, and continuing thereafter for the period described in Section
2(k), above, or until terminated in accordance with Section 20
hereof.  The Board shall have the power
to change the duration of Offering Periods (including the commencement dates
thereof) with respect to future offerings without shareholder approval if such
change is announced at least five (5) days prior to the scheduled
beginning of the first Offering Period to be affected thereafter.

Page 3

5.     Participation.

        (a)    An eligible Employee may become a participant in the
Plan by completing a subscription agreement authorizing payroll deductions in
the form of Exhibit A to this Plan and filing it with the Company's
payroll office prior to the applicable Enrollment Date.

        (b)    Payroll deductions for a participant shall commence on
the first payroll following the Enrollment Date and shall end on the last
payroll in the Offering Period to which such authorization is applicable,
unless sooner terminated by the participant as provided in Section 10
hereof.

6.     Payroll Deductions.

        (a)    At the time a participant files his or her subscription
agreement, he or she shall elect to have payroll deductions made on each pay
day during the Offering Period in an amount not exceeding twenty percent (20%)
of the Compensation which he or she receives on each pay day during the
Offering Period.

        (b)    All payroll deductions made for a participant shall be
credited to his or her account under the Plan and shall be withheld in whole
percentages only.  A participant may not
make any additional payments into such account.

        (c)    A participant may discontinue his or her participation
in the Plan as provided in Section 10 hereof, or may increase or decrease
the rate of his or her payroll deductions during the Offering Period by
completing or filing with the Company a new subscription agreement authorizing
a change in payroll deduction rate.  The
Board may, in its discretion, limit the number of participation rate changes
during any Offering Period.  The change
in rate shall be effective with the first full payroll period following five
(5) business days after the Company's receipt of the new subscription
agreement unless the Company elects to process a given change in participation
more quickly.  A participant's
subscription agreement shall remain in effect for successive Offering Periods
unless terminated as provided in Section 10 hereof.

        (d)    Notwithstanding the foregoing, to the extent necessary
to comply with Section 423(b)(8) of the Code and
Section 3(b) hereof, a participant's payroll deductions may be
decreased to zero percent (0%) at any time during an Offering Period.  Payroll deductions shall recommence at the
rate provided in such participant's subscription agreement at the beginning of
the first Offering Period which is scheduled to end in the following calendar
year, unless terminated by the participant as provided in Section 10
hereof.

        (e)    At the time a Purchase Right is exercised, in whole or
in part, or at the time some or all of the Company's Common Stock issued under
the Plan is disposed of, the participant must make adequate provision for the
Company's federal, state, or other tax withholding obligations, if any, which arise
upon the exercise of the Purchase Right or the disposition of the Common
Stock.  At any time, the Company may,
but shall not be obligated to, withhold from the participant's Compensation the
amount necessary for the Company to meet applicable withholding obligations,
including any withholding required to make available to the Company any tax
deductions or benefits attributable to sale or early disposition of Common
Stock by the Employee.

Page 4

7.     Grant of Purchase Right.  On the Enrollment Date of each Offering Period,
each eligible Employee participating in such Offering Period shall be granted a
Purchase Right to purchase on the Exercise Date of such Offering Period (at the
applicable Purchase Price) up to a number of shares of the Company's Common
Stock determined by dividing such Employee's payroll deductions accumulated
prior to such Exercise Date and retained in the Participant's account as of the
Exercise Date by the applicable Purchase Price; provided that (i) in no event
shall an Employee be permitted to purchase during each Offering Period more
than 20,000 shares (subject to any adjustment pursuant to Section 19), and (ii)
such purchase shall be subject to the limitations set forth in
Sections 3(b) and 13 hereof. 
The Board may, for any future Offering Period, increase or decrease, in
its absolute discretion, the maximum number of shares of the Company's Common
Stock an Employee may purchase during each Offering Period.  Exercise of a Purchase Right shall occur as
provided in Section 8 hereof, unless the participant has withdrawn
pursuant to Section 10 hereof.  A
Purchase Right shall expire on the last day of the Offering Period.

8.     Exercise of Purchase Right.

Unless a participant withdraws from the Plan as provided in
Section 10 hereof, his or her Purchase Right for the purchase of shares
shall be exercised automatically on the Exercise Date, and the maximum number
of full shares subject to Purchase Rights shall be purchased for such
participant at the applicable Purchase Price with the accumulated payroll deductions
in his or her account.  No fractional
shares shall be purchased; any payroll deductions accumulated in a
participant's account which are not sufficient to purchase a full share shall
be retained in the participant's account for the subsequent Offering Period,
subject to earlier withdrawal by the participant as provided in Section 10
hereof.  In the event that the aggregate
number of shares that all participants elect to purchase on an Exercise Date
exceeds the maximum number of shares remaining available for issuance under the
Plan, then the number of shares to which each participant is entitled shall be
determined by multiplying the number of shares available for issuance by a
fraction, the numerator of which is the number of shares that such participant
has elected to purchase and the denominator of which is the number of shares
that all participants have elected to purchase.  Any other amounts left over in a participant's account after the
Exercise Date shall be returned to the participant.  During a participant's lifetime, a participant's Purchase Right
to purchase shares hereunder is exercisable only by him or her.

9.     Delivery. 
As promptly as practicable after each Exercise Date on which a purchase
of shares occurs, the Company shall arrange the delivery to each participant,
as appropriate, of a certificate representing the shares purchased upon
exercise of his or her Purchase Right.

Page 5

10.    Withdrawal.

         (a)     A participant may withdraw all but not less than all
the payroll deductions credited to his or her account and not yet used to
exercise his or her Purchase Rights under the Plan at any time by giving
written notice to the Company in the form of Exhibit B to this Plan.  All of the participant's payroll deductions
credited to his or her account shall be paid to such participant promptly after
receipt of notice of withdrawal and such participant's Purchase Rights for the
Offering Period shall be automatically terminated, and no further payroll
deductions for the purchase of shares shall be made for such Offering Period.  If a participant withdraws from an Offering
Period, payroll deductions shall not resume at the beginning of the succeeding
Offering Period unless the participant delivers to the Company a new
subscription agreement.

        (b)     A participant's withdrawal from an Offering Period
shall not have any effect upon his or her eligibility to participate in any
similar plan which may hereafter be adopted by the Company or in succeeding
Offering Periods which commence after the termination of the Offering Period
from which the participant withdraws.

11.    Termination of Employment.  Upon a participant's ceasing to be an
Employee, for any reason, he or she shall be deemed to have elected to withdraw
from the Plan and the payroll deductions credited to such participant's account
during the Offering Period but not yet used to exercise the Participant's
Purchase Rights shall be returned to such participant or, in the case of his or
her death, to the person or persons entitled thereto under Section 15
hereof, and such participant's Purchase Rights shall be automatically
terminated.  The preceding sentence
notwithstanding, a participant who receives payment in lieu of notice of
termination of employment shall be treated as continuing to be an Employee for
the participant's customary number of hours per week of employment during the
period in which the participant is subject to such payment in lieu of notice.

12.    Interest. 
No interest shall accrue on the payroll deductions of a participant in
the Plan.

13.    Stock.

         (a)     Subject to adjustment upon changes in capitalization of
the Company as provided in Section 19 hereof, the maximum number of shares
of the Company's Common Stock which shall be made available for sale under the
Plan shall be one million (1,000,000) shares.

         (b)     The participant shall have no interest or voting right
in shares covered by his or her Purchase Rights until such Purchase Rights have
been exercised.

         (c)     Shares to be delivered to a participant under the Plan
shall be registered in the name of the participant or in the name of the
participant and his or her spouse.

14.    Administration and Acts of Committee.  The Plan shall be administered by the Board
or a committee of members of the Board appointed by the Board.  Such committee is authorized to take any
action which is permitted of the Board under the terms of this Plan.  The Board or its committee shall have full
and exclusive discretionary authority to construe, interpret and apply the
terms of the Plan, to determine eligibility and to adjudicate all disputed
claims filed under the Plan.  Every
finding, decision and determination made by the Board or its committee shall,
to the full extent permitted by law, be final and binding upon all parties.

Page 6

15.    Designation of Beneficiary.

         (a)     A participant may file a written designation of a
beneficiary who is to receive any shares and cash, if any, from the
participant's account under the Plan in the event of such participant's death
subsequent to an Exercise Date on which a Purchase Right is exercised but prior
to delivery to such participant of such shares and cash.  In addition, a participant may file a
written designation of a beneficiary who is to receive any cash from the
participant's account under the Plan in the event of such participant's death
prior to exercise of a Purchase Right. 
If a participant is married and the designated beneficiary is not the
spouse, spousal consent shall be required for such designation to be effective.

        (b)      Such designation of beneficiary may be changed by the
participant at any time by written notice. 
In the event of the death of a participant and in the absence of a
beneficiary validly designated under the Plan who is living at the time of such
participant's death, the Company shall deliver such shares and/or cash to the
executor or administrator of the estate of the participant, or if no such
executor or administrator has been appointed (to the knowledge of the Company),
the Company, in its discretion, may deliver such shares and/or cash to the
spouse or to any one or more dependents or relatives of the participant, or if
no spouse, dependent or relative is known to the Company, then to such other
person as the Company may designate.

16.    Transferability.  Neither payroll deductions credited to a participant's account
nor any rights with regard to the exercise of a Purchase Right or to receive
shares under the Plan may be assigned, transferred, pledged or otherwise
disposed of in any way (other than by will, the laws of descent and
distribution or as provided in Section 15 hereof) by the participant.  Any such attempt at assignment, transfer,
pledge or other disposition shall be without effect, except that the Company
may treat such act as an election to withdraw funds from an Offering Period in
accordance with Section 10 hereof. 
No Purchase Right shall be pledged or hypothecated in any way, nor shall
any Purchase Right be subject to execution, attachment or similar process.

17.    Use of Funds. 
All payroll deductions received or held by the Company under the Plan
may be used by the Company for any corporate purpose, and the Company shall not
be obligated to segregate such payroll deductions.

18.    Reports. 
Individual accounts shall be maintained for each participant in the
Plan.  Statements of account shall be
given to participating Employees at least annually, which statements shall set
forth the amounts of payroll deductions, the Purchase Price, the number of
shares purchased and the remaining cash balance, if any.

Page 7

19.    Adjustments Upon Changes in Capitalization,
Dissolution, Liquidation, Merger or Asset Sale.

         (a)     Changes in Capitalization.  Subject to any required action by the
shareholders of the Company, the Reserves, the maximum number of shares each
participant may purchase each Offering Period (pursuant to Section 7), as
well as the price per share and the number of shares of Common Stock covered by
each Purchase Right under the Plan which has not yet been exercised shall be
proportionately adjusted for any increase or decrease in the number of issued
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 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, 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 a Purchase Right.

        (b)     Dissolution or Liquidation.  In the event of the proposed dissolution or
liquidation of the Company, the Offering Period then in progress shall be
shortened by setting a new Exercise Date (the "New Exercise Date"),
and shall terminate immediately prior to the consummation of such proposed
dissolution or liquidation, unless provided otherwise by the Board.  The New Exercise Date shall be before the
date of the Company's proposed dissolution or liquidation.  The Board shall notify each participant in
writing, at least ten (10) business days prior to the New Exercise Date, that
the Exercise Date for the participant's Purchase Rights has been changed to the
New Exercise Date and that the participant's Purchase Rights shall be exercised
automatically on the New Exercise Date, unless prior to such date the
participant has withdrawn from the Offering Period as provided in
Section 10 hereof.

        (c)     Merger or Asset Sale.  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, each outstanding Purchase Right shall be assumed or an equivalent
Purchase Right substituted by the successor corporation or a Parent or
Subsidiary of the successor corporation. 
In the event that the successor corporation refuses to assume or
substitute for the Purchase Right, any Offering Period then in progress shall
be shortened by setting a new Exercise Date (the "New Exercise Date")
and any Offering Periods then in progress shall end on the New Exercise Date.  The New Exercise Date shall be before the
date of the Company's proposed sale or merger. 
The Board shall notify each participant in writing, at least ten (10)
business days prior to the New Exercise Date, that the Exercise Date for the
participant's Purchase Rights has been changed to the New Exercise Date and
that the participant's Purchase Rights shall be exercised automatically on the
New Exercise Date, unless prior to such date the participant has withdrawn from
the Offering Period as provided in Section 10 hereof.

Page 8

20.     Amendment or Termination.

         (a)     The Board of Directors of the Company may at any time
and for any reason terminate or amend the Plan.  Except as provided in Section 19 or this Section 20 hereof,
no such termination can affect Purchase Rights previously granted, provided
that an Offering Period may be terminated by the Board of Directors on any
Exercise Date if the Board determines that the termination of the Offering
Period or the Plan is in the best interests of the Company and its shareholders.  Except as provided in Section 19 and
this Section 20 hereof, no amendment may make any change in any Purchase
Right theretofore granted which adversely affects the rights of any
participant.  To the extent necessary to
comply with Section 423 of the Code (or any successor rule or provision or
any other applicable law, regulation or stock exchange rule), the Company shall
obtain shareholder approval in such a manner and to such a degree as required.

        (b)     Without shareholder consent and without regard to whether
any participant rights may be considered to have been "adversely
affected," the Board (or its committee) shall be entitled to change the
Offering Periods, limit the frequency and/or number of changes in the amount
withheld during an Offering Period, establish the exchange ratio applicable to
amounts withheld in a currency other than U.S. dollars, permit payroll
withholding in excess of the amount designated by a participant in order to
adjust for delays or mistakes in the Company's processing of properly completed
withholding elections, establish reasonable waiting and adjustment periods
and/or accounting and crediting procedures to ensure that amounts applied
toward the purchase of Common Stock for each participant properly correspond
with amounts withheld from the participant's Compensation, and establish such
other limitations or procedures as the Board (or its committee) determines in
its sole discretion advisable which are consistent with the Plan.

        (c)     In the event the Board determines that the ongoing operation
of the Plan may result in unfavorable financial accounting consequences, the
Board may, in its discretion and, to the extent necessary or desirable, modify
or amend the Plan to reduce or eliminate such accounting consequence including,
but not limited to:

                
(1)     altering the Purchase Price for any Offering Period
including an Offering Period underway at the time of the change in Purchase
Price;

                
(2)     shortening any Offering Period so that the Offering
Period ends on a new Exercise Date, including an Offering Period underway at
the time of the Board action; and

                
(3)     allocating shares.

                
Such modifications or
amendments shall not require stockholder approval or the consent of any Plan
participants.

Page 9

21.     Arbitration. 
In the event of any dispute between the Company and a participant
regarding this Plan, the dispute and any issue as to the arbitrability of such
dispute, shall be settled to the exclusion of a court of law, by arbitration in
San Diego, California, by a panel of three arbitrators (each party shall choose
one arbitrator and the third shall be chosen by the two arbitrators so
selected) in accordance with the Commercial Arbitration Rules of the American
Arbitration Association then in effect. 
The decision of a majority of the arbitrators shall be final and binding
upon the parties.  All costs of the
arbitration and the fees of the arbitrators shall be allocated between the
parties as determined by a majority of the arbitrators, it being the intention
of the parties that the prevailing party in such a proceeding be made whole
with respect to its expenses.

22.     Governing Law. 
This Agreement shall be governed by the laws of the State of California.

23.     Notices. 
All notices or other communications by a participant to the Company
under or in connection with the Plan shall be deemed to have been duly given
when received in the form specified by the Company at the location, or by the
person, designated by the Company for the receipt thereof.

24.     Conditions Upon Issuance of Shares.  Shares shall not be issued with respect to a
Purchase Right unless the exercise of such Purchase Right and the issuance and
delivery of such shares pursuant thereto shall comply with all applicable
provisions of law, domestic or foreign, including, without limitation, the
Securities Act of 1933, as amended, the Securities Exchange Act of 1934
("Exchange Act"), as amended, the rules and regulations promulgated
thereunder, and the requirements of 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 a Purchase Right,
the Company may require the person exercising such Purchase Right 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 applicable provisions
of law.

25.     Term of Plan. 
The Plan shall become effective upon the earlier to occur of its
adoption by the Board of Directors or its approval by the shareholders of the
Company.  It shall continue in effect
for a term of ten (10) years unless sooner terminated under Section 20
hereof.

Page 10

26.     Additional Restrictions of Rule 16b-3.  The terms and conditions of Purchase Rights
granted hereunder to, and the purchase of Common Stock by, persons subject to
Section 16 of the Exchange Act shall comply with the applicable provisions of
Rule 16b-3.  This Plan shall be deemed
to contain, and such Purchase Rights shall contain, and the Common Stock issued
upon exercise thereof shall be subject to, such additional conditions and
restrictions as may be required by Rule 16b-3 to qualify for the maximum
exemption from Section 16 of the Exchange Act with respect to Plan
transactions.

         As adopted by the Board of Directors on ________

         SYS

         By:__________________________

 

 

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