Document:

SUBORDINATION AGREEMENT

     THIS  SUBORDINATION AGREEMENT (this "Agreement") is made  as
of  May  4,  2000  by  and  among Congress Financial  Corporation
(Southwest), a Texas corporation ("Lender"), LSB Industries, Inc.
("Subordinated   Creditor"),   DriveLine   Technologies,    Inc.,
(formerly   known  as  Tribonetics  Corporation),   an   Oklahoma
corporation  ("DriveLine") and L&S Manufacturing Corp.  ("LSMC").
LSMC  and DriveLine are hereinafter referred to individually  and
collectively as "Borrower".

                            RECITALS:

     WHEREAS, L&S Automotive Products Co. ("LSAP"), a Delaware
corporation, DriveLine and MC Automotive Acquisition Corp., an
Oklahoma corporation ("MCAA") are parties to that certain Stock
Purchase and Sale Agreement of even date herewith (the "Stock
Purchase Agreement"), pursuant to which MCAA will purchase all
shares of common stock in DriveLine owned by Subordinated
Creditor; and

     WHEREAS, LSAP, L&S Bearing Co. ("L&SB"), an Oklahoma
corporation, LSB Extrusion Co. ("LSBE"), an Oklahoma corporation
and Rotex Corporation ("Rotex"), an Oklahoma corporation as
sellers ("Sellers") and DriveLine as purchaser have entered into
an Asset Purchase and Sale Agreement of even date herewith (the
"Asset Sale Agreement") pursuant to which DriveLine will purchase
all or substantially all of the assets of the Sellers (the "Asset
Sale"); and

     WHEREAS, pursuant to the Stock Purchase Agreement and the
Asset Sale Agreement Borrower has entered into certain credit
accommodations and contractual obligations with Subordinated
Creditor, including but not limited to those notes, credit
accommodations and agreements described in Exhibit A attached
hereto (the "Subordinated Notes"); and

     WHEREAS, the Subordinated Notes are secured by among other
documents, instruments and agreements, (a) that certain Secured
Guaranty Agreement of even date herewith between MCAA and
Subordinated  Creditor (the "MCAA Guaranty"); (b) that certain
Security Agreement of even date herewith by and among Borrower
and Subordinated Creditor (the "Borrower Security Agreement");
(c) that certain Stock Pledge Agreement of even date herewith
between Murray Cohen Revocable Trust #2 and Subordinated Creditor
(the "Cohen Stock Pledge"); (d) that certain Stock Pledge
Agreement of even date herewith by and between MCAA and
Subordinated Creditor (the "MCAA Stock Pledge"); and (e) that
certain Stock Pledge Agreement of even date herewith between
DriveLine and Subordinated Creditor (the "DriveLine Stock
Pledge"); and

     WHEREAS, the Subordinated Notes, the Stock Purchase
Agreement, the Asset Sale Agreement, the MCAA Stock Pledge, the
MCAA Guaranty, the Borrower Security Agreement, the Cohen Stock
Pledge and the DriveLine Stock Pledge, and all agreements,
documents, instruments evidencing, governing or executed or
delivered in connection therewith, including without limitation,
all amendments, modifications, renewals and extensions of the
foregoing are collectively referred to herein as the
"Subordinated Documents;" and

     WHEREAS, Lender has made, or in the future may make, credit
accommodations available to Borrower pursuant to the terms and
provisions of that certain Amended and Restated Loan and Security
Agreement of even date herewith by and among Lender and Borrower,
as amended, modified extended and restated from time to time (the
"Loan Agreement"); and

     WHEREAS,  in  order  to induce Lender  to  make  the  credit
accommodations   described   above   available    to    Borrower,
Subordinated Creditor has agreed to subordinate all of its rights
and  claims  now  existing or hereafter arising pursuant  to  the
Subordinated  Documents to the rights and claims  of  Lender  now
existing or hereafter arising against Borrower, all in accordance
with the terms and provisions of this Agreement;

     NOW, THEREFORE, for and in consideration of the premises and
the mutual agreements contained herein, the parties hereto hereby
agree as follows:

                            ARTICLE I
                           DEFINITIONS

     1.1   Defined Terms.  As used in this Agreement,  the  terms
defined  above  shall have their respective  meanings  set  forth
above and the following terms shall have the following meanings:

          "Borrower  Stock"  shall mean any  and  all  shares  of
     capital stock now or hereafter issued by Borrower.

          "Collateral" shall mean any and all property which  now
     constitutes or hereafter will constitute collateral or other
     security for payment of the Senior Indebtedness pursuant  to
     the Senior Documents.

          "Distribution"  by  any  Person  shall  mean  (a)  with
     respect to any stock or partnership interest issued by  such
     Person,  the  retirement,  redemption,  purchase  or   other
     acquisition  for  value  of any such  stock  or  partnership
     interest, (b) the declaration or payment of any dividend  or
     other  distribution on or with respect to any such stock  or
     partnership interest, (c) any loan or advance by such Person
     to, or other investment by such Person in, the holder of any
     such  stock  or  partnership interest,  and  (d)  any  other
     payment  (other  than  ordinary  salaries  to  employees  or
     advances  made  in  the  ordinary  course  of  business   to
     employees  for  travel  or other expenses  incurred  in  the
     ordinary course of business) and other than as permitted  in
     the Senior Documents by such Person to or for the benefit of
     the holder of any such stock or partnership interest.

          "Person"  shall  mean  and  include  an  individual,  a
     partnership, a corporation, a business trust, a joint  stock
     company,  a  trust, an unincorporated association,  a  joint
     venture or other entity or a governmental authority.

          "Proceeds" shall have the meaning assigned to it  under
     the  Uniform Commercial Code, shall also include  "products"
     (as  defined  in the Uniform Commercial Code), and,  in  any
     event, shall include, but not be limited to (a) any and  all
     proceeds  of any insurance, indemnity, warranty,  letter  of
     credit  or  guaranty or collateral security payable  to  any
     grantor  from  time  to  time with respect  to  any  of  the
     Collateral,   (b)  any  and  all  payments  (in   any   form
     whatsoever)  made  or due and payable to the  owner  of  the
     Collateral  from  time  to  time  in  connection  with   any
     requisition,   confiscation,   condemnation,   seizure    or
     forfeiture  of  all  or any part of the  Collateral  by  any
     governmental  body,  authority, bureau  or  agency  (or  any
     Person acting under color of governmental authority) and (c)
     any  and all other amounts from time to time paid or payable
     under or in connection with any of the Collateral.

          "Senior  Creditor" shall mean Lender and its successors
     and assigns.

          "Senior  Documents" shall mean any and all  agreements,
     documents and instruments evidencing, governing or  executed
     or  delivered  in  connection with the Senior  Indebtedness,
     including, without limitation, the Loan Agreement.

          "Senior   Indebtedness"  shall   mean   any   and   all
     indebtedness, obligations and liabilities of every kind  and
     character of Borrower or any obligor now or hereafter  owing
     to  Senior  Creditor, whether such indebtedness, obligations
     and   liabilities  are  direct  or  indirect,   primary   or
     secondary,  joint,  several or joint and several,  fixed  or
     contingent  and  whether  incurred  by  Borrower  as  maker,
     endorser,   guarantor  or  otherwise,   including,   without
     limitation,  any  and  all  indebtedness,  obligations   and
     liabilities  of  Borrower now or hereafter owing  to  Senior
     Creditor pursuant to or evidenced by the Senior Documents.

          "Subordinated  Indebtedness" shall  mean  any  and  all
     indebtedness, obligations and liabilities of every kind  and
     character of Borrower, MCAA, Murray Cohen Revocable Trust #2
     or any other obligor under the Subordinated Documents now or
     hereafter owing to Subordinated Creditor, including, without
     limitation,  the indebtedness evidenced and to be  evidenced
     by  the  Subordinated Documents, whether such  indebtedness,
     obligations and liabilities are direct or indirect,  primary
     or  secondary, joint, several or joint and several, fixed or
     contingent  and whether incurred by Borrower,  MCAA,  Murray
     Cohen  Revocable  Trust #2 or any other  obligor  under  the
     Subordinated Documents as maker, endorser, guarantor.

                           ARTICLE II
                      RIGHTS IN COLLATERAL

     2.1   Priorities  Regarding  Collateral.  Until  the  Senior
Indebtedness has been finally and irrevocably paid  in  full  and
the commitments of Senior Creditor under the Loan Agreement shall
have  terminated  as  provided herein, any  and  every  lien  and
security interest in the Collateral in favor of or held  for  the
benefit  of the Senior Creditor has and shall have priority  over
any  lien  or security interest that Subordinated Creditor  might
have  or  acquire in the Collateral notwithstanding any statement
or provision contained in the Subordinated Documents or otherwise
to  the  contrary and irrespective of the time or order of filing
or  recording of financing statements, deeds of trust,  mortgages
or  other  notices  of security interests, liens  or  assignments
granted  pursuant thereto, and irrespective of anything contained
in  any  filing  or agreement to which any party  hereto  or  its
respective  successors  and assigns may now  or  hereafter  be  a
party,  and  irrespective of the ordinary rules  for  determining
priorities under the Uniform Commercial Code or under  any  other
law  governing the relative priorities of secured creditors.  Any
lien  or  security  interest  of  Subordinated  Creditor  in  the
Collateral and any and all rights of Subordinated Creditor to the
Collateral  are  and  shall be inferior and  subordinate  to  the
rights  of Senior Creditor thereto. Until the Senior Indebtedness
has been finally and irrevocably paid in full and the commitments
of Senior Creditor under the Loan Agreement shall have terminated
as  provided  herein, Subordinated Creditor  shall  not  make  or
permit any assignment, transfer, pledge or disposition of all  or
any  part of the Subordinated Indebtedness (or any collateral  or
other security for the Subordinated Indebtedness).

     2.2   Management of Collateral.  Senior Creditor shall  have
the  exclusive right to manage, perform and enforce the terms  of
the  Senior Documents with respect to the Collateral, to exercise
and enforce all privileges and rights thereunder according to its
discretion  and the exercise of its business judgment, including,
but  not  limited  to,  the exclusive right  to  take  or  retake
possession  of  the  Collateral and to hold,  prepare  for  sale,
process,  sell,  lease, dispose of, or liquidate the  Collateral,
pursuant to a foreclosure or otherwise.  Notwithstanding anything
to   the  contrary  contained  in  any  document,  instrument  or
agreement   evidencing,   securing  or  otherwise   executed   in
connection  with the incurrence of the Subordinated Indebtedness,
only  the  Senior Creditor shall have the right  to  restrict  or
permit,  or  approve or disapprove, the sale, transfer  or  other
disposition  of Collateral.  Accordingly, should Senior  Creditor
elect to exercise its rights and remedies with respect to any  of
the  Collateral,  Senior Creditor may proceed to  do  so  without
regard to any interest of Subordinated Creditor, and Subordinated
Creditor  waives  any  claims that it  may  have  against  Senior
Creditor  for  any  disposition of the Collateral.   Subordinated
Creditor  agrees, whether or not a default has  occurred  in  the
payment  of  any  indebtedness or the performance  of  any  other
obligations  to it, that any liens on and security  interests  in
the  Collateral  or any portion thereof that  it  might  have  or
acquire  shall automatically be fully released with respect  only
to  the  purchaser(s) of such Collateral, as to all  indebtedness
and  other  obligations  secured thereby  owing  to  Subordinated
Creditor  if  and when Senior Creditor releases its lien  in  and
security  interest  on  such Collateral or any  portion  thereof,
provided,  however,  that  after  satisfaction  in  full  of  all
Obligations, the remaining proceeds, if any, shall be payable  to
the  parties  legally  entitled thereto,  including  Subordinated
Creditor  (giving  effect  to  Subordinated  Creditor's  Security
Interest in the Collateral).

                           ARTICLE III
                            PROCEEDS

     3.1   Distribution of Proceeds of Collateral.  At  any  time
during  which  (i)  all  or any part of the  Senior  Indebtedness
remains outstanding, and whether or not the same is then due  and
payable, or (ii) the commitments of the Senior Creditor under the
Loan  Agreement  remain  in effect, the  Proceeds  of  any  sale,
disposition  or  other realization by Senior  Creditor  or  other
party hereto (or any agent therefor) upon all or any part of  the
Collateral  shall be applied in the following order of priorities
irrespective of the application of any rule of law or the  defect
or  impairment of any Senior Document, Subordinated  Document  or
security interest, lien or assignment thereunder:

     first, to  the  payment of all costs and expenses of  Senior
            Creditor  and/or  its  agent  or  agents  (including,
            without  limitation, the reasonable fees and expenses
            of   counsel   to   Senior  Creditor)   incurred   in
            connection  with the collection of such  Proceeds  or
            the  protection of the rights and interests of Senior
            Creditor therein;

     second,to  the payment in full of all Senior Indebtedness in
            such order as Senior Creditor shall determine in  its
            sole discretion; and

     finally,     to  pay  any  surplus  then  remaining  to  the
            parties  legally  entitled  thereto,  including   the
            Subordinated  Creditor, the owner of  the  Collateral
            or  its  successors  or assigns  or  as  a  court  of
            competent jurisdiction may direct.

     3.2   Contingent Obligations.  For purposes of  distributing
the  Proceeds  of  Collateral pursuant to this Article  III,  the
portion  of  Senior Indebtedness consisting of loans or  advances
not  yet  made  by Senior Creditor to Borrower under  the  Senior
Documents   shall   be   considered  Senior   Indebtedness   then
outstanding,  and  the Senior Creditor shall have  the  right  to
retain,  in a cash collateral account, cash collateral  equal  to
the  amount thereof which Senior Creditor determines, in its sole
discretion, may arise or exist from time to time.

     3.3   Holding  of  Proceeds  in Trust.   In  the  event  the
Subordinated Creditor (or an affiliate thereof) or any  party  to
this  Agreement other than Senior Creditor receives the  Proceeds
of the Collateral, such party shall be deemed to hold all of such
Proceeds  in trust for the benefit of Senior Creditor  until  the
application  thereof in accordance with Section 3.1  hereof.   No
party  to  this  Agreement shall seek to challenge the  validity,
enforceability,  priority or perfection  of  any  of  the  Senior
Documents  if the purpose or effect thereof would in  any  manner
defeat  or  delay  the  distribution  of  the  Proceeds  of   any
Collateral in the manner set forth in Section 3.1 hereof.

                           ARTICLE IV
                          SUBORDINATION

     Subordinated   Creditor  covenants  and  agrees   that   the
Subordinated  Indebtedness, howsoever evidenced and  whether  now
existing   or  hereafter  incurred,  shall  be  subordinate   and
subordinated in right of payment, to the extent and in the manner
hereinafter set forth, of all Senior Indebtedness:

          (a)   The holder of the Senior Indebtedness shall first
     be  finally and irrevocably paid in cash an aggregate amount
     equal to the principal thereof and termination fees, if any,
     interest at the time due thereon, and all other costs, fees,
     expenses   and/or   obligations  now  or   hereafter   owing
     thereunder, and the Senior Creditor's commitments under  the
     Loan  Agreement  shall have terminated  as  provided  herein
     before  any  payment or Distribution (other  than  Permitted
     Payments  (as defined below)) of any character,  whether  in
     cash, securities or other property, shall be made on account
     of  the Subordinated Indebtedness or otherwise to or for the
     benefit  of  the  Subordinated Creditor in  respect  of  the
     Subordinated  Indebtedness; and any payment or  Distribution
     of  any  character,  whether in cash,  securities  or  other
     property,  which would otherwise, but for the provisions  of
     this Article IV, be payable or deliverable in respect of the
     Subordinated  Indebtedness or otherwise  shall  be  paid  or
     delivered  directly to the holder of the Senior Indebtedness
     (or  its  duly  authorized representatives), until  all  the
     Senior Indebtedness shall have been irrevocably paid in full
     and   the  Senior  Creditor's  commitments  under  the  Loan
     Agreement shall have terminated as provided herein.

          (b)  Notwithstanding the provisions of subparagraph (a)
     of   this  Article  IV,  Borrower  may  make  its  regularly
     scheduled  (i.e.  uncollected  and  not  prepaid)   interest
     payment  obligations to the Subordinated Creditor under  the
     promissory  notes of Borrower to LSB Industries,  Inc.,  one
     such note in the amount of $5,934,000, and one such note  in
     the   amount   of  $2,732,000,  executed  pursuant   to   or
     contemporaneously   with  the  Asset   Purchase   and   Sale
     Agreement,  substantially in the  form  attached  hereto  as
     Exhibit  B,  as  and when the same are due  and  payable  as
     presently provided therein and at the rate provided  therein
     (the  "Permitted Payments"); provided, however,  that  as  a
     condition  precedent to Borrower's right to  make  (and  the
     Subordinated Creditor's right to receive) any and  all  such
     Permitted Payments:

               (i)  there shall not have occurred or then exist a
          default  or  event of default that is continuing  under
          any  of  the  Senior Indebtedness or any of the  Senior
          Documents, or an event or condition which with  notice,
          lapse  of  time  or  the making of such  payment  would
          constitute a default or event of default under  any  of
          the foregoing;

               (ii) Borrower's Excess Availability (as defined in
          the  Loan Agreement) shall be greater than or equal  to
          $1,000,000  on the date of and after giving  effect  to
          each Permitted Payment;

               (iii)       Subordinated   Creditor   shall   have
          completed  the  Asset Sale and the Stock  Purchase  (as
          defined in the Senior Documents) and there shall be  no
          default under the terms and conditions thereof;

               (iv) there shall at all times be at least a $_____
          [Balance  as  of  May  4,  2000] outstanding  principal
          balance owing on the Subordinated Notes; and

               (v)    the  Senior  Creditor,  on  or  before  the
          fifteenth  (15th) day preceding the date  of  any  such
          payment, shall have received a certificate, executed by
          the Chief Executive Officer and Chief Financial Officer
          of the of Borrower, which certifies, in form, substance
          and  detail satisfactory to the Senior Creditor in  its
          sole   discretion,   that  the   foregoing   conditions
          precedent  to any payment to the Subordinated  Creditor
          as  set  forth  in  subparagraph (b)(i),  (b)(ii),  and
          (b)(iii) of this Article IV have been satisfied.

          (c)   The  Subordinated  Creditor  agrees  to  promptly
     notify  the  Senior Creditor in writing of  any  default  or
     event  of  default  that is continuing on  any  Subordinated
     Indebtedness  or otherwise or under any of the  Subordinated
     Documents  and further agrees not to exercise any  right  or
     remedy  or take any enforcement action with respect  to  any
     default  or  event  of  default on any of  the  Subordinated
     Indebtedness  or otherwise or under any of the  Subordinated
     Documents  until  such time as the Senior  Indebtedness  has
     been  irrevocably  paid  in full and the  Senior  Creditor's
     commitments  under the Loan Agreement shall have  terminated
     as  provided herein.  Without limiting any of the foregoing,
     any failure of Borrower to perform any of its obligations to
     the  Subordinated  Creditor  as  a  result  of  any  of  the
     prohibitions, restrictions or limitations set forth in  this
     Agreement  shall not constitute the basis for a  default  or
     event  of default on any Subordinated Indebtedness or  under
     any Subordinated Documents.  An Event of Default (as defined
     in the Loan Agreement) under the Loan Agreement shall not be
     the  cause  of  an  event of default under the  Subordinated
     Notes.

          (d)  Except as provided in (b) above, no reimbursement,
     payment,  direct  or  indirect,  or  disbursement  of  other
     property or assets of Borrower shall be made by Borrower  on
     account  of  the Subordinated Indebtedness or  otherwise  or
     received,  accepted, retained or applied by the Subordinated
     Creditor   on  Borrower's  account  with  respect   to   the
     Subordinated  Indebtedness  (except  for  the  account   and
     benefit of Senior Creditor, which shall be held in trust for
     Senior  Creditor,  or  except as specifically  permitted  in
     Subparagraph (b) of this Article IV) until such time as  the
     Senior Indebtedness has been finally and irrevocably paid in
     full  and the commitments of Senior Creditor under the  Loan
     Agreement shall have terminated as provided herein.

          (e)   Without  affecting  the  Subordinated  Creditor's
     obligations set forth in this Agreement not to exercise  any
     remedy   as   set  forth  in  this  Article  IV  under   the
     circumstances  described  herein,  in  the  event  that  the
     Subordinated  Creditor exercises any remedy permitted  under
     applicable  law  with  respect  to  any  of  the  assets  or
     properties of Borrower or receives any other payment of  any
     character, whether in cash, securities, or other properties,
     that  would, but for the provisions of this Article  IV,  be
     payable  or  deliverable  in  respect  of  the  Subordinated
     Indebtedness,  such  cash, securities  or  other  properties
     shall be held in trust for the benefit of the holder of  the
     Senior  Indebtedness and shall be paid or delivered  to  the
     holder   of  the  Senior  Indebtedness  (or  its  authorized
     representatives), in the proportions in which it holds same,
     until  all the Senior Indebtedness shall have been  paid  in
     full  and  the Senior Creditor's commitments under the  Loan
     Agreement shall have terminated as provided herein.

          (f)   The  provisions  of this Agreement  are  and  are
     intended  solely  for the purpose of defining  the  relative
     rights  of  the holder of the Subordinated Indebtedness,  on
     the  one hand, and the holder of the Senior Indebtedness  on
     the  other  hand.   Nothing contained in this  Agreement  is
     intended  to  or shall impair, as between Borrower  and  the
     holder  of the Subordinated Indebtedness, the obligation  of
     Borrower which is absolute and unconditional, to pay to  the
     holder   of  the  Subordinated  Indebtedness  the  principal
     thereof  and  interest thereon as and when  the  same  shall
     become due and payable in accordance with its terms,  or  is
     intended  to  or  shall affect the relative  rights  against
     Borrower of the holder of the Senior Indebtedness.

          (g)  No right of any present or future holder of any of
     the  Senior  Indebtedness to enforce  the  subordination  as
     herein  provided shall at any time in any way be  prejudiced
     or  impaired  by any act or failure to act on  the  part  of
     Borrower  or by any act in good faith or failure to  act  in
     good  faith  by any such holder, or by any noncompliance  by
     Borrower  with  the covenants, agreements and conditions  of
     the  Subordinated Indebtedness, regardless of any  knowledge
     thereof  any  such  holder may have or be otherwise  charged
     with.

          (h)   Senior  Creditor  shall  have  no  obligation  to
     preserve  the  rights of the Collateral  against  any  prior
     parties  or to marshal any of the Collateral for the benefit
     of any Person.

                            ARTICLE V
                  PROHIBITION OF DISTRIBUTIONS

     Except  as may be expressly permitted pursuant to  the  Loan
Agreement,  Borrower hereby agrees that it will not declare,  pay
or  make any Distribution with respect to the Borrower Stock  or,
otherwise  to any holder of the Borrower Stock.  Until such  time
as  the  Senior Indebtedness has been paid in full and the Senior
Creditor's  commitments  under  the  Loan  Agreement  shall  have
terminated  as  provided  herein,  except  as  may  be  expressly
permitted pursuant to the Loan Agreement, Borrower hereby  agrees
that  it will not authorize or approve the issuance of, or issue,
any  shares  of  any  class  of such its  capital  stock  or  any
security,   right,   option  or  warrant  convertible   into   or
exercisable  for  any shares of any class of its  capital  stock.
Subordinated Creditor hereby agrees that, until such time as  the
Senior  Indebtedness  has  been  paid  in  full  and  the  Senior
Creditor's  commitments  under  the  Loan  Agreement  shall  have
terminated  as  provided herein, it (A)  will  not  cause  to  be
declared,  paid  or  made any Distribution with  respect  to  the
Borrower Stock, or, except as expressly permitted pursuant to the
Loan  Agreement,  to  it, (B) will not cause  to  be  authorized,
approved, or issued any shares of any class of its capital  stock
or  any  security, right, option or warrant convertible  into  or
exercisable for any shares of any class of its capital stock, and
(C)  shall on Senior Creditor's request or automatically  on  the
occurrence  of  any  Event  of  Default  cause  the  certificates
evidencing  the  Borrower  Stock  owned  and/or  held   by   such
Subordinated Creditor to be marked with a legend with a statement
that  such  Borrower Stock is subject to the terms and provisions
of this Agreement.

                           ARTICLE VI
                       FURTHER ASSURANCES

     Each of the parties hereto hereby agrees to promptly execute
and  deliver to the other parties hereto any and all such further
instruments  and documents and take such further action  as  such
other parties may reasonably request in order to fully effect the
purposes of this Agreement.

                           ARTICLE VII
            REPRESENTATIONS AND WARRANTIES OF PARTIES

     7.1   General Representations and Warranties.  Each  of  the
Subordinated  Creditor  and the Borrower  hereby  represents  and
warrants to Senior Creditor that:

          (a)   such  party has full power, authority  and  legal
     right  to  execute, deliver and perform this Agreement,  and
     has  taken all necessary corporate or partnership action  to
     authorize  the execution, delivery and performance  of  this
     Agreement;

          (b)   this  Agreement constitutes a  legal,  valid  and
     binding obligation of such party enforceable against  it  in
     accordance  with its terms except as enforceability  may  be
     limited by applicable bankruptcy, insolvency, moratorium  or
     other similar laws affecting creditors rights generally  and
     except   as   enforceability  may  be  limited  by   general
     principles of equity (whether considered in a suit at law or
     in equity); and

          (c)   Subordinated Creditor is the only holder  of  the
     indebtedness evidenced by the Subordinated Notes.

     7.2   Additional Representations and Warranty.  Subordinated
Creditor hereby represents and warrants to Senior Creditor that a
true  and  correct  copy of the draft documents,  instruments  or
Agreements  evidencing or governing the terms of the Subordinated
Notes  is  attached  hereto  as Exhibit  A  and  that  the  final
definitive  version of such documents, instruments or  agreements
will be in substantial conformity therewith.

                          ARTICLE VIII
                CONSENT OF SUBORDINATED CREDITOR

     Subordinated  Creditor hereby consents to the execution  and
delivery  of  the Senior Documents and any borrowings  thereunder
and  agrees  that the performance (including, without limitation,
the  making  of future borrowings) by Borrower of its obligations
under  the Senior Documents will not constitute a default  or  an
event  of default under the Subordinated Documents.  Subordinated
Creditor  further  consents to and covenants  that,  without  the
necessity  of  any  reservation of  rights  against  Subordinated
Creditor, and without notice to or further assent by Subordinated
Creditor,  (a) any demand for payment of any Senior  Indebtedness
may  be rescinded in whole or in part and any Senior Indebtedness
may  be  continued, and the Senior Indebtedness, or the liability
of  Borrower or any other Person upon or for any part thereof, or
any  collateral security or guaranty therefor or right of  offset
with  respect thereto, or any obligation or liability of Borrower
or  any other Person under the Senior Documents may, from time to
time,  in  whole  or  in  part, be renewed,  extended,  modified,
accelerated,  compromised, waived and surrendered,  or  released,
and   (b)  the  Senior  Documents,  any  document  or  instrument
evidencing  or governing the terms of the Senior Indebtedness  or
any  collateral security documents or guaranties or documents  in
connection  therewith may be amended, modified,  supplemented  or
terminated,  in whole or in part, as the Senior Creditor  or  its
agent  may  deem advisable from time to time, and any  collateral
security  at any time held for the benefit of the Senior Creditor
for  the  payment of any of the Senior Indebtedness may be  sold,
exchanged,  waived, surrendered or released,  in  each  case  all
without  notice to or further assent by the Subordinated Creditor
which  will  remain bound under this Agreement, and  all  without
impairing,  abridging, releasing or affecting  the  subordination
provided for herein, notwithstanding any such renewal, extension,
modification,  acceleration, compromise,  amendment,  supplement,
termination,  sale, exchange, waiver, surrender or release.   The
Subordinated Creditor waives any and all notice of the  creation,
renewal, extension, subsequent advance or accrual of any  of  the
Senior  Indebtedness and notice of or proof of  reliance  by  the
Senior  Creditor upon this Agreement, and the Senior Indebtedness
shall conclusively be deemed to have been created, contracted  or
incurred  in  reliance  upon  this Agreement,  and  all  dealings
between Borrower and the Senior Creditor have been deemed to have
been   consummated   in  reliance  upon  this   Agreement.    The
Subordinated  Creditor acknowledges and agrees  that  the  Senior
Creditor  has relied upon the subordination and consent  provided
for  herein  in  entering into the Senior Loan Documents  and  in
providing  for  the  credit facilities  described  therein.   The
Subordinated  Creditor waives notice of or proof of  reliance  on
this  Agreement  and protest, demand for payment  and  notice  of
default.  Any agreements, documents or instruments which  at  any
time  evidence the Subordinated Indebtedness or any part  thereof
shall be marked with a legend stating that payment thereunder  is
subject  to  the  terms and provisions of  this  Agreement.   The
Subordinated  Creditor  agrees  that  it  shall  not,  under  any
circumstances,  take or initiate any action or  proceeding  under
any  federal or state bankruptcy or insolvency law, or any  other
reorganization,  liquidation, receivership or similar  action  or
proceeding  involving Borrower without the prior written  consent
of  every  Senior  Creditor,  which consent  may  be  granted  or
withheld  by each Senior Creditor in such Senior Creditor's  sole
and absolute discretion.

                           ARTICLE IX
                      BORROWER'S AGREEMENT

     The  Borrower  hereby  acknowledges  that  the  Subordinated
Indebtedness is payable as stated herein, and agrees to  make  no
payment   of   principal  of  or  interest  on  the  Subordinated
Indebtedness so long as the Borrower shall be indebted to  Senior
Creditor,  except  (i) such payments as may  be  made  to  Senior
Creditor,  (ii)  such  payments as may be  made  with  the  prior
written  consent of Senior Creditor, and (iii) such  payments  as
are  permitted  by Article IV herein.  If (a) the Borrower  makes
any  other payment of the Subordinated Indebtedness, except  such
payments as are permitted by Article IV herein, (b) any  term  of
this  Agreement is breached by the Borrower, or (c) the  Borrower
fails  to make any payment of the Subordinated Indebtedness  when
due  after Senior Creditor has given its written consent  to  the
making  of  such  payment,  then,  notwithstanding  any  contrary
provisions  of the Loan Agreement, Senior Creditor  may,  at  its
sole   election,  declare  all  or  any  portion  of  the  Senior
Indebtedness to be immediately due and payable without demand  or
notice of any kind.

                            ARTICLE X
              PROVISIONS TO APPLY AFTER BANKRUPTCY

     The  provisions  of this Agreement shall  continue  in  full
force  and  effect, notwithstanding the commencement  of  a  case
under  Title  11  of  the United States Code, as  amended  and/or
superseded (the "Federal Bankruptcy Code") by or against Borrower
or  any  of  its  property.  In furtherance of the foregoing,  if
Subordinated Creditor receives any property of, or payments  from
Borrower  after the commencement of such a case on account  of  a
secured  claim  which  is  subordinated  by  the  terms  of  this
Agreement   (whether   as  "adequate  protection"   payments   or
otherwise),  Subordinated Creditor shall  immediately  turn  such
property or payments over to the Senior Creditor for distribution
by   it   in   accordance  with  the  applicable  provisions   of
Article  III.   To the extent that Subordinated Creditor  has  or
acquires  any  rights under Section 363 or  Section  364  of  the
Federal  Bankruptcy Code with respect to collateral, Subordinated
Creditor  hereby  agrees not to assert such  rights  without  the
prior  written consent of the Senior Creditor.  The  Subordinated
Creditor  hereby  grants to the Senior Creditor  the  right,  but
Senior  Creditor shall not be obligated, to file, prove and  vote
claims  on  account  of  the  Subordinated  Indebtedness  in  any
receivership, bankruptcy, or other proceeding under  the  Federal
Bankruptcy   Code   commenced  by  or  against   Borrower.    The
Subordinated  Creditor  shall not prove  or  vote  any  claim  on
account  of  the  Subordinated Indebtedness in any  receivership,
bankruptcy, or other proceeding under the Federal Bankruptcy Code
commenced  by  or  against Borrower in a manner  which  adversely
effects  the rights, claims and interests of the Senior  Creditor
now  existing  or hereafter arising concerning the Collateral  or
against the Borrower.

                           ARTICLE XI
                 NO WAIVER, CUMULATIVE REMEDIES

     No  failure to exercise, and no delay in exercising  on  the
part of Senior Creditor, any right, power or privilege under this
Agreement shall operate as a waiver thereof, nor shall any single
or  partial  exercise by Senior Creditor of any right,  power  or
privilege  under  this Agreement preclude any  other  or  further
exercise  thereof or the exercise of any other  right,  power  or
privilege by Senior Creditor.  The rights and remedies by  Senior
Creditor provided in this Agreement are cumulative and shall  not
be exclusive of any rights or remedies provided by law.

                           ARTICLE XII
                             NOTICES

     All  notices, requests and demands to or upon the respective
parties hereto to be effective shall be in writing (including  by
telegraph,  facsimile, or telex) and, unless otherwise  expressly
provided herein, shall be deemed to have been duly given or  made
when  delivered by hand, or if by certified mail, return  receipt
requested, five days after being deposited in the mail or, in the
case of facsimile notice, when sent, acknowledgment of receipt is
received, or if sent by reputable overnight delivery service  for
next business day delivery, on the next business day addressed as
set  forth  below or to such address or other address as  may  be
hereafter notified in writing by the respective parties hereto:

     To Senior Creditor:      Congress Financial Corporation
     (Southwest)
                              1201 Main Street, Suite 1625
                              Dallas, Texas 75250
                              Attn: Portfolio Manager
                              Telecopy No.: (214) 748-9131

     With copies to:          Patton Boggs LLP
                              2001 Ross Avenue, Suite 3000
                              Dallas, Texas 75201
                              Attn: Larry A. Makel, Esq.
                              Telecopy No.: (214) 758-1550

     To Borrower:            L & S Automotive Products Co.
                             6 South Pennsylvania Ave.
                             Oklahoma City, OK 73101
                             Attn: President
                             Fax: (405) 236-1209

                             With copy to:
                             David Shear
                             16 South Pennsylvania Ave.
                             Oklahoma City, OK 73101

    To Subordinated Creditor:LSB Industries, Inc.
                             16 South Pennsylvania Ave.
                             Oklahoma City, OK 73101
                             Attn:
                             Fax: (405) 236-1209

                             With copy to:
                             David Shear
                             16 South Pennsylvania Ave.
                             Oklahoma City, OK 73101

                          ARTICLE XIII
                          GOVERNING LAW

     This Agreement has been executed, delivered and accepted  at
and shall be deemed to have been made in Dallas County, Texas and
shall  be  interpreted  and the rights  and  obligations  of  the
parties  under this Agreement shall be governed by, and construed
and  interpreted  in accordance with, the internal  laws  of  the
State of Texas and shall be binding upon and inure to the benefit
of   the   parties   hereto  and  their  respective   successors,
transferees and assigns.

                           ARTICLE XIV
                     AMENDMENTS AND WAIVERS

     Neither  this Agreement nor any of the terms hereof  may  be
amended,  waived, discharged or terminated unless such amendment,
waiver, discharge or termination is in writing signed by each  of
the  parties  hereto.  Each of the Borrower and the  Subordinated
Creditor  agree  not to amend the Subordinated Documents  without
the prior written consent of the Senior Creditor.

                           ARTICLE XV
                           EXCULPATION

     Neither the Senior Creditor nor its agents have made to  the
other parties hereto nor do any of them hereby or otherwise  make
any  representations or warranties, express or  implied,  nor  do
they assume any liability with respect to (i) obligors under  any
instruments  of  guarantee;  (ii) the  enforceability,  validity,
value   or   collectibility  of  the  Senior  Indebtedness,   any
Collateral therefor, or any guarantee or security which may  have
been  granted  to  any  of  them in connection  with  the  Senior
Documents;  or  (iii) Borrower's title or right to  transfer  any
collateral or security.  Senior Creditor shall not be  liable  to
any  other party hereto for any action or failure to act  or  any
error of judgment, negligence, or mistake or oversight whatsoever
on  its  part  or its respective agents, officers,  employees  or
attorneys  with  respect  to  any  transaction  relating  to  the
Collateral or this Agreement.  To the maximum extent permitted by
law,  except as otherwise provided herein, Subordinated  Creditor
waives  any  claim  it  might have against Senior  Creditor  with
respect  to,  or  arising out of, the handling of the  Collateral
(including,  without limitation, any such claim  based  upon  the
timing or method of realizing upon such Collateral).

                           ARTICLE XVI
                       THIRD PARTY RIGHTS

     This  Agreement  is solely for the benefit  of  the  parties
hereto and their respective successors and assigns, and no  other
Person  shall have any right, benefit, priority or other interest
under, or because of the existence of, this Agreement.

                          ARTICLE XVII
                           TERMINATION

     This   Agreement  shall  terminate  upon   the   final   and
indefeasible payment in full of all the Senior Indebtedness,  the
termination  of  Senior  Creditor's commitments  under  the  Loan
Agreement and the termination of all of the Senior Documents.

                          ARTICLE XVIII
                          COUNTERPARTS

     This Agreement may be executed by one or more of the parties
hereto  in  any  number of separate counterparts, each  of  which
shall  be an original, but all of which shall constitute but  one
agreement.

                           ARTICLE XIX
                 ASSIGNMENT OF SUBORDINATED DEBT

     Subordinated  Creditor shall not sell, assign,  or  transfer
any  part  of  the  Subordinated  Notes  unless  such  purchaser,
assignee or transferee agrees to be bound by this Agreement.

                           ARTICLE XX
                           JURY WAIVER

     SUBORDINATED  CREDITOR, BORROWER AND SENIOR CREDITOR  HEREBY
WAIVE ANY RIGHT TO TRIAL BY JURY OF ANY CLAIM, DEMAND, ACTION  OR
CAUSE  OF ACTION (i) ARISING UNDER THIS AGREEMENT OR ANY  OF  THE
OTHER  FINANCING AGREEMENTS OR (ii) IN ANY WAY CONNECTED WITH  OR
RELATED  OR INCIDENTAL TO THE DEALINGS OF THE PARTIES  HERETO  IN
RESPECT   OF  THIS  AGREEMENT  OR  ANY  OF  THE  OTHER  FINANCING
AGREEMENTS OR THE TRANSACTIONS RELATED HERETO OR THERETO IN  EACH
CASE  WHETHER NOW EXISTING OR HEREAFTER ARISING, AND  WHETHER  IN
CONTRACT,  TORT,  EQUITY  OR OTHERWISE.   SUBORDINATED  CREDITOR,
BORROWER  AND SENIOR CREDITOR HEREBY AGREE AND CONSENT  THAT  ANY
SUCH CLAIM, DEMAND, ACTION OR CAUSE OF ACTION SHALL BE DECIDED BY
COURT  TRIAL  WITHOUT  A  JURY  AND THAT  SUBORDINATED  CREDITOR,
BORROWER OR SENIOR CREDITOR MAY FILE AN ORIGINAL COUNTERPART OF A
COPY OF THIS AGREEMENT WITH ANY COURT AS WRITTEN EVIDENCE OF  THE
CONSENT  OF  THE PARTIES HERETO TO THE WAIVER OF THEIR  RIGHT  TO
TRIAL  BY  JURY.   SUBORDINATED  CREDITOR,  BORROWER  AND  SENIOR
CREDITOR  HEREBY AGREE AND CONSENT THAT ANY SUCH  CLAIM,  DEMAND,
ACTION OR CAUSE OF ACTION SHALL BE DECIDED BY COURT TRIAL WITHOUT
A  JURY  AND  THAT  SUBORDINATED  CREDITOR,  BORROWER  OR  SENIOR
CREDITOR  MAY  FILE AN ORIGINAL COUNTERPART OF  A  COPY  OF  THIS
AGREEMENT  WITH ANY COURT AS WRITTEN EVIDENCE OF THE  CONSENT  OF
THE PARTIES HERETO TO THE WAIVER OF THEIR RIGHT TO TRIAL BY JURY.

    [The Remainder of This Page is Intentionally Left Blank]
     IN  WITNESS  WHEREOF,  the parties hereto  have  caused  this
Agreement  to be duly executed by their proper and duly authorized
officers or partners as of the day and year first above written.

                                 SUBORDINATED CREDITOR:

                                 LSB INDUSTRIES, INC.

                                 By:
                                 Name:
                                 Title:

                                 BORROWER:

                                 DRIVELINE TECHNOLOGIES, INC.,
                                 (formerly known as Tribonetics
                                 Corporation)

                                 By:
                                 Name:
                                 Title:
                                 L&S  MANUFACTURING CORP.

                                 By:
                                 Name:
                                 Title:

                                 LENDER:

                                 CONGRESS FINANCIAL CORPORATION
                                 (SOUTHWEST)

                                 By:
                                 Name:
                                 Title:EXHIBIT 10.59

                           TRIMBLE NAVIGATION LIMITED

                             1993 STOCK OPTION PLAN
                            (as amended May 11, 2000)

 1.  Purposes of the Plan.  The  purposes  of this Stock  Option Plan are to
attract and retain the best  available  personnel for  positions of  substantial
responsibility, to provide additional incentive to the Employees and Consultants
of the Company and to promote the success of the Company's business.

     Options  granted  hereunder  may  be  either  Incentive  Stock  Options  or
Nonstatutory  Stock Options,  at the discretion of the Board and as reflected in
the terms of the written option agreement.

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

     (a)  "Administrator"  means  the Board or any of its  Committees  appointed
pursuant to Section 4 of the Plan.

     (b) "Board" shall mean the  Committee,  if one has been  appointed,  or the
Board of Directors of the Company, if no Committee is appointed.

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

     (d)  "Committee"  shall  mean  the  Committee  appointed  by the  Board  of
Directors in accordance  with  paragraph (a) of Section 4 of the Plan, if one is
appointed.

     (e) "Common Stock" shall mean the Common Stock of the Company.

     (f)  "Company"  shall  mean  Trimble   Navigation   Limited,  a  California
corporation.

     (g) "Consultant" shall mean any person who is engaged by the Company or any
Parent or Subsidiary to render  consulting  services and is compensated for such
consulting  services,  and any director of the Company  whether  compensated for
such  services  or not,  provided  that the term  Consultant  shall not  include
directors  who are  not  compensated  for  their  services  or are  paid  only a
director's fee by the Company.

     (h) "Continuous Status as an Employee or Consultant" shall mean the absence
of any  interruption  or  termination  of service as an Employee or  Consultant.
Continuous  Status  as  an  Employee  or  Consultant  shall  not  be  considered
interrupted  in the case of sick leave,  military  leave,  or any other leave of
absence  approved by the  Company or any Parent or  Subsidiary  of the  Company;
provided  that  such  leave  is for a  period  of  not  more  than  90  days  or
reemployment  upon the  expiration  of such leave is  guaranteed  by contract or
statute.

     (i)  "Employee"  shall mean any person,  including  officers and directors,
employed by the Company or any Parent or Subsidiary of the Company.  The payment
of a  director's  fee by the  Company  shall  not be  sufficient  to  constitute
"employment" by the Company.

     (j) "Exchange Act" means the Securities Exchange Act of 1934, as amended.

                                       9
<PAGE>

     (k) "Fair Market  Value" means,  as of any date,  the value of Common Stock
determined as follows:

        (i) If the Common Stock is listed on any established stock exchange or a
national market system including  without  limitation the National Market System
of the National  Association of Securities  Dealers,  Inc.  Automated  Quotation
("NASDAQ")  System,  its Fair Market Value shall be the closing  sales price for
such stock (or the  closing  bid, if no sales were  reported,  as quoted on such
system  or  exchange  for the  last  market  trading  day  prior  to the time of
determination)  as reported in the Wall Street  Journal or such other  source as
the Administrator deems reliable;

        (ii) If the  ommon  Stock is quoted on the NASDAQ System (but not on the
National Market System thereof) or regularly  quoted by a recognized  securities
dealer but selling  prices are not reported,  its Fair Market Value shall be the
mean between the high and low asked prices for the Common Stock or;

        (iii) In the absence of an established market for the Common Stock,  the
Fair  Market  Value   thereof   shall  be   determined  in  good  faith  by  the
Administrator.

     (l) "Incentive Stock Option" shall mean an Option intended to qualify as an
incentive stock option within the meaning of Section 422 of the Code.

     (m)  "Nonstatutory  Stock  Option"  shall  mean an Option not  intended  to
qualify as an Incentive Stock Option.

     (n) "Option" shall mean a stock option granted pursuant to the Plan.

     (o) "Optioned Stock" shall mean the Common Stock subject to an Option.

     (p) "Optionee" shall mean an Employee or Consultant who receives an Option.

     (q) "Parent"  shall mean a "parent  corporation",  whether now or hereafter
existing, as defined in Section 424(e) of the Code.

     (r) "Plan" shall mean this 1993 Stock Option Plan.

     (s)  "Share"  shall  mean a share  of the  Common  Stock,  as  adjusted  in
accordance with Section 11 of the Plan.

     (t)  "Subsidiary"  shall mean a  "subsidiary  corporation",  whether now or
hereafter existing, as defined in Section 424(f) of the Code.

 3.  Stock  Subject to the Plan.  Subject to the  provisions of Section 11 of
the Plan, the maximum  aggregate number of shares which may be optioned and sold
under  the  Plan  is  5,925,000  shares  of  Common  Stock.  The  Shares  may be
authorized, but unissued, or reacquired Common Stock.

     If an Option should expire or become  unexercisable  for any reason without
having been exercised in full, the unpurchased Shares which were subject thereto
shall,  unless the Plan shall have been terminated,  become available for future
grant under the Plan.  Notwithstanding  any other provision of the Plan,  shares
issued  under the Plan and later  repurchased  by the  Company  shall not become
available for future grant or sale under the Plan.

                                       10
<PAGE>

 4.  Administration of the Plan.

     (a) Procedure.

        (i)  Multiple Administrative  Bodies. The  Plan  may be  dministered  by
different   Committees  with  respect  to  different  groups  of  Employees  and
Consultants.

        (ii) Section 162(m). To the extent that the Administrator determines it
to be  desirable  to  qualify  Options  granted  hereunder as "performance-based
compensation"  within the meaning of Section  162(m) of the Code, the Plan shall
be  administered  by a Committee of two or more "outside  directors"  within the
meaning of Section 162(m) of the Code.

        (iii) Rule 16b-3. To the extent desirable to qualify transactions
hereunderas exempt under Rule 16b-3,  the  transactions  contemplated  hereunder
shall be structured to satisfy the requirements for exemption under Rule 16b-3.

     (b) Powers of the Administrator.  Subject to the provisions of the Plan and
in the case of a Committee,  the specific duties  delegated by the Board to such
Committee, the Administrator shall have the authority, in its discretion:

        (i) to determine the Fair Market Value of the Common Stock, in
accordance with Section 2(k) of the Plan;

        (ii) to select the officers,  Consultants and Employees to whom Options
may from time to time be granted hereunder;

        (iii)  to  determine  whether  and  to  what  extent Options are granted
hereunder;

        (iv) to  determine  the  number of shares of Common  Stock to be covered
by each such award granted hereunder;

        (v) to approve forms of agreement for use under the Plan;

        (vi) to determine the terms and conditions, not inconsistent with the
terms of the Plan, of any award granted hereunder (including,  but not limited
to, the share price and any  restriction or limitation,  or any vesting
acceleration or waiver of  forfeiture  restrictions  regarding  any Option  and/
or the shares of Common  Stock  relating  thereto,  based  in each  case on such
factors  as the Administrator shall determine, in its sole discretion);

        (vii) to determine whether and under what circumstances an Option may be
settled in cash under subsection 9(e) instead of Common Stock;

        (viii) to determine whether, to what extent and under what circumstances
Common Stock and other amounts  payable with respect to an award under this Plan
shall be deferred  either  automatically  or at the election of the  participant
(including  providing  for and  determining  the  amount,  if any, of any deemed
earnings on any deferred amount during any deferral period);

        (ix) to reduce the exercise price of any Option to the then current Fair
Market Value if the Fair Market Value of the Common Stock covered by such Option
shall have declined since the date the Option was granted; and

                                       11
<PAGE>

     (c) Effect of Administrator's  Decision. All decisions,  determinations and
interpretations of the Administrator shall be final and binding on all Optionees
and any other holders of any Options.

     (d)  Grant  Limits.  The  following  limitations  shall  apply to grants of
Options under the Plan:

        (i) No  employee  shall be  granted,  in any  fiscal  year of the
Company, Options under the Plan to purchase more than 150,000  Shares,  provided
that the Company  may make an  additional  one-time  grant  of up to  250,000
Shares  to newly-hired Employees.

        (ii)  The  foregoing  limitations  shall  be  adjusted  proportionately
in connection  with any change in the  Company's  capitalization  as  described
in Section 11.

        (iii) If an Option is canceled (other than in connection with a
transaction described  in Section 11),  the  canceled  Option  shall be counted
against the limits set forth in Section 4(d)(i).  For this purpose, if the
exercise price of an Option is reduced,  the transaction  will be treated as a
cancellation of the Option and the grant of a new Option.

 5.  Eligibility.

     (a) Nonstatutory Stock Options may be granted only to Employees, Directors,
and  Consultants.  Incentive Stock Options may be granted only to Employees.  An
Employee,  Director,  or Consultant who has been granted an Option may, if he is
otherwise eligible, be granted an additional Option or Options.

     (b) Each Option  shall be  designated  in the written  option  agreement as
either an  Incentive  Stock  Option or a  Nonstatutory  Stock  Option.  However,
notwithstanding such designations,  to the extent that the aggregate Fair Market
Value of the Shares with respect to which Options  designated as Incentive Stock
Options are  exercisable  for the first time by any Optionee during any calendar
year  (under  all plans of the  Company  or any  Parent or  Subsidiary)  exceeds
$100,000, such excess Options shall be treated as Nonstatutory Stock Options.

     (c) For purposes of Section  5(b),  Incentive  Stock Options shall be taken
into account in the order in which they were granted,  and the Fair Market Value
of the Shares shall be determined as of the time the Option with respect to such
Shares is granted.

     (d) The Plan shall not confer upon any  Optionee  any right with respect to
continuation  of  employment or consulting  relationship  with the Company,  nor
shall it interfere in any way with his right or the Company's right to terminate
his employment or consulting relationship at any time, with or without cause.

 6.  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 as described in Section 18 of the Plan. It shall  continue in effect
for a term of ten (10) years unless  sooner  terminated  under Section 14 of the
Plan.

 7.  Term of Option. The term of each Option shall be ten (10) years from the
date of grant  thereof or such  shorter  term as may be  provided  in the Option
Agreement.  However,  in the case of an  Incentive  Stock  Option  granted to an
Optionee who, at the time the Option is granted,  owns stock  representing  more
than ten  percent  (10%) of the  voting  power  of all  classes  of stock of the
Company or any Parent or

                                       12
<PAGE>

Subsidiary, the term of the Option shall be five (5) years from the date of
grant thereof or such shorter term as may be provided in the Option Agreement.

 8.  Exercise Price and Consideration.

     (a) The per Share  exercise  price for the Shares to be issued  pursuant to
exercise of an Option  shall be such price as is  determined  by the Board,  but
shall be subject to the following:

        (i) In the case of an Incentive Stock Option

                (A) granted to an Employee who, at the time of the grant of such
Incentive Stock Option,  owns stock representing more than ten percent (10%) of
the voting power of all  classes of stock of the Company or any Parent or
Subsidiary,  the per Share exercise price shall be no less than 110% of the Fair
Market Value per Share on the date of grant.

                (B) granted to any Employee,  the per Share exercise price shall
be no less than 100% of the Fair Market Value per Share on the date of grant.

        (ii) In the case of a  Nonstatutory Stock Option, the per Share exercise
price shall be determined by the  Administrator.  In the case of a  Nonstatutory
Stock Option intended to qualify as "performance-based  compensation" within the
meaning of Section  162(m) of the Code, the per Share exercise price shall be no
less than 100% of the Fair Market Value per Share on the date of grant.

        (iii)  Notwithstanding the foregoing, Options may be granted  with a per
Share exercise price of less than 100% of the Fair Market Value per Share on the
date of grant pursuant to a merger or other corporate transaction.

     (b) The  consideration to be paid for the Shares to be issued upon exercise
of an  Option,  including  the method of  payment,  shall be  determined  by the
Administrator  and may consist  entirely of (1) cash, (2) check,  (3) promissory
note, (4) other Shares which (x) either have been owned by the Optionee for more
than six  months on the date of  surrender  or were not  acquired,  directly  or
indirectly,  from the  Company,  and (y) have a Fair Market Value on the date of
surrender  equal to the aggregate  exercise price of the Shares as to which said
Option shall be exercised, (5) authorization from the Company to retain from the
total number of Shares as to which the Option is exercised that number of Shares
having a Fair Market Value on the date of exercise  equal to the exercise  price
for the total number of Shares as to which the Option is exercised, (6) delivery
of a properly executed exercise notice together with irrevocable instructions to
a broker to promptly  deliver to the Company the amount of sale or loan proceeds
required to pay the exercise price, (7) delivery of an irrevocable  subscription
agreement for the Shares which  irrevocably  obligates the option holder to take
and pay for the Shares not more than twelve months after the date of delivery of
the  subscription  agreement,  (8) any  combination of the foregoing  methods of
payment,  (9) or such other consideration and method of payment for the issuance
of  Shares  to the  extent  permitted  under  Applicable  Laws.  In  making  its
determination  as to the  type of  consideration  to  accept,  the  Board  shall
consider if  acceptance  of such  consideration  may be  reasonably  expected to
benefit the Company.

 9.  Exercise of Option.

     (a) Procedure for Exercise;  Rights as a  Shareholder.  Any Option  granted
hereunder  shall be  exercisable  at such  times and under  such  conditions  as
determined  by the Board,  including  performance  criteria  with respect to the
Company and/or the Optionee,  and as shall be permissible under the terms of the
Plan.

                                       13
<PAGE>

     An Option may not be exercised for a fraction of a Share.

     An Option  shall be  deemed to be  exercised  when  written  notice of such
exercise  has been  given to the  Company  in  accordance  with the terms of the
Option by the person  entitled to exercise  the Option and full  payment for the
Shares with  respect to which the Option is exercised  has been  received by the
Company.  Full  payment  may,  as  authorized  by  the  Board,  consist  of  any
consideration  and method of payment  allowable  under Section 8(b) of the Plan.
Until the issuance (as  evidenced by the  appropriate  entry on the books of the
Company or of a duly  authorized  transfer  agent of the  Company)  of the stock
certificate evidencing such Shares, no right to vote or receive dividends or any
other rights as a  shareholder  shall exist with respect to the Optioned  Stock,
notwithstanding the exercise of the Option. The Company shall issue (or cause to
be issued)  such stock  certificate  promptly  upon  exercise of the Option.  No
adjustment  will be made for a dividend or other right for which the record date
is prior to the date the stock  certificate  is issued,  except as  provided  in
Section 11 of the Plan.

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

     (b)  Termination  of Status as an Employee or  Consultant.  In the event of
termination of an Optionee's  Continuous Status as an Employee or Consultant (as
the case may be),  such  Optionee may, but only within thirty (30) days (or such
other period of time, not exceeding three (3) months in the case of an Incentive
Stock Option or six (6) months in the case of a Nonstatutory Stock Option, as is
determined  by the Board)  after the date of such  termination  (but in no event
later than the date of expiration of the term of such Option as set forth in the
Option  Agreement),  exercise  his Option to the extent that he was  entitled to
exercise  it at the  date of such  termination.  To the  extent  that he was not
entitled to exercise the Option at the date of such  termination,  or if he does
not exercise  such Option  (which he was  entitled to exercise)  within the time
specified herein, the Option shall terminate.

     (c) Disability of Optionee.  Notwithstanding the provisions of Section 9(b)
above,  in the event of  termination  of an Optionee's  Continuous  Status as an
Employee or  Consultant as a result of his total and  permanent  disability  (as
defined in Section 22(e)(3) of the Code), he may, but only within six (6) months
(or such other period of time not exceeding  twelve (12) months as is determined
by the Board) from the date of such  termination (but in no event later than the
date of  expiration  of the  term of such  Option  as set  forth  in the  Option
Agreement),  exercise his Option to the extent he was entitled to exercise it at
the date of such termination. To the extent that he was not entitled to exercise
the Option at the date of  termination,  or if he does not exercise  such Option
(which he was entitled to exercise) within the time specified herein, the Option
shall terminate.

     (d) Death of Optionee. In the event of the death of an Optionee:

        (i)  during  the  term of the  Option who is at the time of his death an
Employee or  Consultant  of the  Company  and who shall have been in  Continuous
Status as an Employee or Consultant  since the date of grant of the Option,  the
Option may be  exercised,  at any time within  twelve (12) months  following the
date of death (but in no event later than the date of  expiration of the term of
such Option as set forth in the Option  Agreement),  by the Optionee's estate or
by a person  who  acquired  the  right to  exercise  the  Option by  bequest  or
inheritance,  but only to the  extent of the right to  exercise  that would have
accrued had the Optionee  continued living and remained in Continuous  Status as
an Employee or Consultant twelve (12) months after the date of death, subject to
the limitation set forth in Section 5(b); or

                                       14
<PAGE>

        (ii) within thirty (30) days (or such other period of time not exceeding
three (3)  months as is  determined  by the  Board)  after  the  termination  of
Continuous Status as an Employee or Consultant,  the Option may be exercised, at
any time within twelve (12) months  following the date of death (but in no event
later than the date of expiration of the term of such Option as set forth in the
Option  Agreement),  by the  Optionee's  estate or by a person who  acquired the
right to exercise the Option by bequest or  inheritance,  but only to the extent
of the right to exercise that had accrued at the date of termination.

     (e) Buyout  Provisions.  The Administrator may at any time offer to buy out
for a payment in cash or Shares,  an Option  previously  granted,  based on such
terms and conditions as the Administrator shall establish and communicate to the
Optionee at the time that such offer is made.

 10. Non-Transferability  of  Options.  Options  may not be sold,  pledged,
assigned,  hypothecated,  transferred or disposed of in any manner other than by
will or by the laws of descent  and  distribution  or  pursuant  to a  qualified
domestic  relations  order as  defined  by the  Code or Title I of the  Employee
Retirement  Income Security Act, or the rules  thereunder.  The designation of a
beneficiary  by an Optionee  does not  constitute  a transfer.  An Option may be
exercised,  during the  lifetime  of the  Optionee,  only by the  Optionee  or a
transferee permitted by this Section 10.

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

     In the event of the proposed dissolution or liquidation of the Company, the
Board  shall  notify  the  Optionee  at least  fifteen  (15) days  prior to such
proposed action. To the extent it has not been previously exercised,  the Option
will terminate immediately prior to the consummation of such proposed action. In
the event of a merger  of the  Company  with or into  another  corporation,  the
Option shall be assumed or an  equivalent  option shall be  substituted  by such
successor  corporation or a parent or subsidiary of such successor  corporation.
In the even the successor corporation does not agree to assume the option or the
substitute and equivalent option, the Board shall, in lieu of such assumption or
substitution, provide for the Optionee to have the right to vest in and exercise
the Option as to all of the  Optioned  Stock,  including  Shares as to which the
Option  would not  otherwise  be vested or  exercisable.  If the Board  makes an
Option fully vested and exercisable in lieu of assumption or substitution in the
event of a merger,  the Board shall notify the Optionee that the Option shall be
fully vested and  exercisable for a period of fifteen (15) days from the date of
such notice,  and the Option will  terminate upon the expiration of such period.
If,  in such a  merger,  the  Option  is  assumed  or an  equivalent  option  is
substituted  by such  successor  corporation  or a parent or  subsidiary of such
successor corporation,  and if during a one-year period after the effective date
of such merger, the Optionee's Continuous Status as an Employee or Consultant is
terminated  for any reason other than the  Optionee's  voluntary  termination of
such  relationship,  then the

                                       15
<PAGE>

Optionee shall have the right within thirty days thereafter to exercise the
Option as to all of the Optioned Stock,  including Shares as to which the Option
would  not  be  otherwise  exercisable,   effective  as  of  the  date  of  such
termination.

 12. Stock  Withholding  to Satisfy  Withholding  Tax  Obligations.  At the
discretion of the Administrator,  Optionees may satisfy withholding  obligations
as  provided  in this  paragraph.  When an  Optionee  incurs  tax  liability  in
connection  with an Option,  which tax  liability is subject to tax  withholding
under  applicable  tax laws, and the Optionee is obligated to pay the Company an
amount  required to be withheld  under  applicable  tax laws,  the  Optionee may
satisfy the withholding tax obligation by electing to have the Company  withhold
from the Shares to be issued upon exercise of the Option, if any, that number of
Shares  having a Fair Market Value equal to the amount  required to be withheld.
The Fair Market Value of the Shares to be withheld  shall be  determined  on the
date that the amount of tax to be withheld is to be determined.

 13. Time of Granting Options. The date of grant of an Option shall, for all
purposes,  be the date on which the Board makes the determination  granting such
Option.  Notice  of the  determination  shall  be  given  to  each  Employee  or
Consultant  to whom an Option is so granted  within a reasonable  time after the
date of such grant.

 14. Amendment and Termination of the Plan.

     (a)  Amendment  and  Termination.  The Board may at any time amend,  alter,
suspend or  discontinue  the Plan, but no amendment,  alteration,  suspension or
discontinuation  shall be made which  would  impair  the rights of any  Optionee
under any grant theretofore made,  without his or her consent.  In addition,  to
the extent  necessary  and  desirable to comply with Section 422 of the Code (or
any other  applicable law or regulation,  including the requirements of the NASD
or an established stock exchange), the Company shall obtain shareholder approval
of any Plan amendment in such a manner and to such a degree as required.

     (b) Effect of Amendment or  Termination.  Any such amendment or termination
of the Plan shall not affect  Options  already  granted and such  Options  shall
remain  in full  force  and  effect  as if this  Plan  had not been  amended  or
terminated, unless mutually agreed otherwise between the Optionee and the Board,
which agreement must be in writing and signed by the Optionee and the Company.

 15. Conditions Upon Issuance of Shares. Shares shall not be issued pursuant
to the exercise of an Option unless the exercise of such Option and the issuance
and  delivery of such Shares  pursuant  thereto  shall  comply with all relevant
provisions of law, including, without limitation, the Securities Act of 1933, as
amended, the Exchange Act, the rules and regulations promulgated thereunder, 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 an Option,  the Company may require the
person  exercising  such Option to represent and warrant at the time of any such
exercise that the Shares are being purchased only for investment and without any
present  intention  to sell or  distribute  such  Shares  if, in the  opinion of
counsel  for  the  Company,  such a  representation  is  required  by any of the
aforementioned relevant provisions of law.

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

                                       16
<PAGE>

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

 17. Option  Agreement.  Options  shall  be  evidenced  by  written  option
agreements in such form as the Board shall approve.

 18. Shareholder  Approval.  Continuance  of the Plan  shall be  subject to
approval by the  shareholders of the Company within twelve (12) months before or
after the date the Plan is adopted.  Such shareholder approval shall be obtained
in the degree and manner required under Applicable Laws.

                                       17
<PAGE>

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