Document:

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                                                                   EXHIBIT 10.11

                         OUTDOOR CHANNEL HOLDINGS, INC.
                  NON-STATUTORY STOCK OPTION PLAN AND AGREEMENT
                  ---------------------------------------------

         THIS NON-STATUTORY STOCK OPTION PLAN AND AGREEMENT (the "Agreement") by
and between OUTDOOR CHANNEL HOLDINGS, INC., an Alaska corporation (the
"Company"), and WILLIAM A. OWEN ("Employee") is entered into effective as of the
13th day of November 2003.

                                    RECITALS
                                    --------

         1. Pursuant to that certain offer letter dated October 13, 2003 by and
between the Company and Employee (the "Letter"), and as an inducement to
Employee to enter into an employment relationship with the Company, the Company
has agreed to grant Employee non-statutory options to purchase an aggregate of
up to 175,000 shares of the Company's common stock;

         2. The Board of Directors of the Company has approved the grant of
options under this Agreement, subject to approval by the stockholders of the
Company; and

         3. The parties desire to set forth the terms and conditions governing
the options granted hereunder.

                  NOW, THEREFORE, the parties hereto agree as follows:

         1. GRANT. The Company hereby grants to Employee the right to purchase
up to 175,000 shares of the Company's common stock at a price equal to $29.00
per share, on the terms and conditions set forth herein. The options granted
hereunder are not intended to qualify as incentive stock options under Section
422 of the Internal Revenue Code, as amended, and are not granted pursuant to
any Company stock option plan. Employee agrees that Employee and any other
person who may be entitled hereunder to exercise these options shall be bound by
all terms and conditions of this Agreement.

         2. VESTING.

                  (a) SCHEDULE. Subject to all of the terms contained in this
Agreement, except as specifically set forth in Section 3 hereof and provided
that Employee continues to provide "Continuous Service" (as defined in Section 3
below) to the Company at such times, the options granted herein shall vest and
become exercisable on the dates and in the amounts as set forth on EXHIBIT A
hereto.

                  (b) CHANGE OF CONTROL. Upon a Change of Control (as such term
is defined below), unless otherwise determined by the Board of Directors of the
Company (the "Board"), then the vesting of all options granted pursuant to this
Agreement shall accelerate, regardless of whether the vesting requirements set
forth herein have been satisfied, and Employee shall have the right, for a
period of ninety (90) days following the termination of Employee's employment,

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to exercise this option with respect to all shares, to the extent not previously
exercised. This Agreement and all rights granted hereunder shall terminate and
otherwise be extinguished on the 91st day following such termination. "Change in
Control" shall mean (i) the acquisition, directly or indirectly, by any person
or group (within the meaning of Section 13(d)(3) of the Securities Exchange Act
of 1934, as amended) of the beneficial ownership of more than fifty percent
(50%) of the outstanding securities of the Company, other than the Company or
any person or group who as of the date of this Agreement is or are director(s)
or officer(s) of the Company (including any affiliates of such officer(s) or
director(s) and trusts established by such persons); (ii) a merger or
consolidation in which the Company is not the surviving entity, except for a
transaction to change the state in which the Company is incorporated; (iii) the
sale, transfer or other disposition of all or substantially all of the assets of
the Company; (iv) a complete liquidation or dissolution of the Company; or (v)
any reverse merger in which the Company is the surviving entity but in which
securities possessing more than fifty percent (50%) of the total combined voting
power of the Company's outstanding securities are transferred to a person or
persons different from the persons holding those securities immediately prior to
such merger.

         3. TERMINATION OF EMPLOYMENT. Employee's right to exercise this option
shall terminate upon the first to occur of the following:

                  (a) the fifth (5th) anniversary date of the date of this
Agreement;

                  (b) the expiration of one year from the date of termination of
Employee's Continuous Service if such termination occurs for any reason other
than voluntary resignation or termination for cause, but only to the extent that
this option was exercisable on the date of termination of such service; or

                  (c) the expiration of six (6) months from the date of
termination of Employee's Continuous Service if Employee's Continuous Service is
terminated for cause or if Employee's Continuous Service is terminated due to
voluntary resignation, but only to the extent that this option was exercisable
on the date of termination of such service.

                  As used herein, the term "Continuous Service" means (i)
employment by either the Company or any parent or subsidiary corporation of the
Company, or by a corporation or a parent or subsidiary of a corporation issuing
or assuming a stock option in a transaction to which Section 424(a) of the
Internal Revenue Code applies, which is uninterrupted except for vacations,
illness, or leaves of absence which are approved in writing by the Company or
any of such other employer corporations, if applicable, (ii) service as a member
of the Board of Directors of the Company until Employee resigns, is removed from
office, or Employee's term of office expires and he or she is not reelected, or
(iii) so long as Employee is engaged as a consultant or service provider to the
Company or other corporation referred to in clause (i) above.

         4. EXERCISE. Subject to approval of this Agreement by the Company's
shareholders pursuant to applicable Alaska law, this option may be exercised in
whole or in part on the terms and conditions contained herein by Employee giving
the Company ten (10) days' prior written notice of Employee's election to
exercise, which notice shall specify the number of shares to be purchased and
the price to be paid therefore. The purchase price shall be payable in full in

                                      -2-

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United States dollars in one or a combination of the following methods: (i) in
cash or check payable to the order of the Company; (ii) in accordance with a
cashless exercise program acceptable to the Company pursuant to which Employee
concurrently provides irrevocable instructions (A) to such Employee's broker or
dealer to effect the immediate sale of the purchased shares and remit to the
Company, out of the sale proceeds available on the settlement date, sufficient
funds to cover the purchase price plus all applicable income and employment
taxes required to be withheld by the Company by reason of such exercise and (B)
to the Company to deliver the certificates for the purchased shares directly to
such broker or dealer in order to complete the sale; and (iii) in the sole
discretion of the Board of Directors of the Company, such other method of
payment or other consideration permitted by applicable law. No shares shall be
delivered pursuant to an exercise of an option until payment in full of the
purchase price therefore is received by the Company.

         5. EFFECT OF EXERCISE. Upon the exercise of all or any part of these
options, the number of shares of common stock subject to the options granted
pursuant to this Agreement shall be reduced by the number of shares with respect
to which such exercise is made.

         6. EXPIRATION. The options granted hereunder shall expire, to the
extent not previously exercised or earlier terminated pursuant to Section 3
hereof, upon the fifth (5th) anniversary of the date of this Agreement.

         7. TRANSFERABILITY. This option shall be transferable only by will or
by the laws of descent and distribution to the estate (or other personal
representative) of Employee and shall be exercisable during Employee's lifetime
only by Employee. Except as otherwise provided herein, any attempt at
alienation, assignment, pledge, hypothecation, transfer, sale, attachment,
execution or similar process, whether voluntary or involuntary, with respect to
all or any part of this option or any right under this Agreement, shall be null
and void.

         8. WITHHOLDING REQUIREMENTS. In the event the Company determines that
it is required to withhold state or federal income taxes as a result of the
exercise of these options, Employee shall be required, as a condition to the
exercise hereof, to make arrangements satisfactory to the Company to enable it
to satisfy such withholding requirements.

         9. RIGHTS AS A STOCKHOLDER. Employee, or any permitted transferee of
Employee, shall have no rights as a stockholder with respect to any shares
covered by these options until the date of the issuance of a stock certificate
for such shares. No adjustment shall be made for dividends (ordinary or
extraordinary, whether in cash, securities or other property), distributions or
other rights for which the record date is prior to the date such stock
certificate is issued, except as provided in Section 10 of this Agreement. This
Agreement shall not confer upon Employee any right of continued employment by
the Company or interfere in any way in the Company's right to terminate
Employee.

         10. RECAPITALIZATION. The number of shares of common stock covered by
this option and the exercise price thereof shall be proportionately adjusted for
any increase or decrease in the number of issued shares of common stock
resulting from a subdivision or consolidation of such shares or the payment of a
stock dividend (but only of common stock) or any other increase or decrease in
the number of issued shares of common stock effected without receipt of

                                      -3-

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consideration by the Company. If the Company is the surviving corporation in any
merger or consolidation, this option shall pertain and apply to the securities
to which a holder of the number of shares of common stock subject to the option
would have been entitled. The foregoing adjustments shall be made by the
Company's board of directors, whose determination shall be conclusive and
binding on the Company and Employee.

         11. SECURITIES ACT AND OTHER REGULATORY REQUIREMENTS. This option is
not exercisable, in whole or in part, and the Company is not obligated to sell
any shares of the Company's common stock subject to this option, if such
exercise or sale, in the opinion of counsel for the Company, would violate the
Securities Act of 1933 (the "Securities Act") (or any other federal or state
statutes having similar requirements) as it may be in effect at that time.
Employee acknowledges and agrees that the options granted to Employee pursuant
to this Agreement are being acquired for investment purposes only and not with a
view to any public distribution thereof. The certificates evidencing any shares
issued pursuant to these options shall bear such restrictive legends as required
by federal or state law. Employee agrees not to offer to sell or otherwise
dispose of the shares of the Company's common stock acquired upon the exercise
of these options in violation of the registration requirements of the Securities
Act or any applicable securities laws.

         12. NOTICES. Any notice or other communication required or permitted
hereunder or by law shall be validly given or made only if in writing and
delivered in person to an officer or duly authorized representative of the other
party, or deposited in the United States mail, duly certified or registered,
return receipt requested, postage prepaid, and addressed to the party to whom
intended. If sent to the Company, it shall be addressed in care of the Chief
Executive Officer, Outdoor Channel Holdings, Inc., 43445 Business Park Drive,
Suite 113, Temecula, California 92590, and if sent to Employee, it shall be
addressed to Employee's address on file with the Company on the date of such
notice. If sent by mail, notice shall be deemed given two days after deposit of
such notice in the mail and in accordance with this section. Any party may from
time to time, by written notice to the other, designate a different address for
notice which shall be substituted for that specified above.

         13. CHOICE OF LAW; COUNTERPARTS. This Agreement, and all rights and
obligations hereunder, shall be governed by the laws of the State of California.
This Agreement may be executed in one or more counterparts, each of which when
so executed and delivered shall be deemed an original, but all such counterparts
together shall constitute but one and the same instrument.

         14. ARBITRATION; VENUE. The parties hereto agree that any disputes or
controversies relating to or arising out of this Agreement shall be resolved
exclusively by arbitration, in accordance with the Letter. The venue for any
such proceeding shall be as set forth in the Letter.

         15. SUCCESSOR. This Agreement shall be binding upon and inure to the
benefit of the parties hereto and their respective successors, heirs,
beneficiaries, executors and administrators.

                                      -4-

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         16. INTEGRATION. The terms and conditions of the options hereunder
shall be governed exclusively by this Agreement and this Agreement shall
supercede the Letter and any other agreement between the parties with respect to
all matters pertaining to the options granted hereunder. Employee acknowledges
that this Agreement (and the grant of options hereunder) and the grant of
options to Employee to purchase 25,000 shares of the Company's common stock
under the Company's 1995 Stock Option Plan also made effective as of the date of
this Agreement satisfy the Company's obligations under paragraph 5 of the
Letter. The Board shall have full power and authority to operate, manage and
administer this Agreement and interpret and construe this Agreement.

         17. PARAGRAPH HEADINGS; EMPLOYMENT. Paragraph headings are for
convenience only and are not part of the context. This Agreement shall not
obligate the Company or any affiliate to employ Employee for any period of time,
nor does this Agreement constitute a contract or agreement for employment.

         18. SHAREHOLDER APPROVAL. This Agreement is effective as of the date
approved by the Board of Directors of the Company; provided, however, that this
Agreement shall be submitted to the Company's stockholders for approval (or
ratification), and if not approved by the stockholders within one year from the
date approved by the Board of Directors, this Agreement shall be of no force and
effect. The options granted under this Agreement before approval of this
Agreement by the stockholders are granted subject to such approval and shall not
be exercisable before such approval.

                  IN WITNESS WHEREOF, this Agreement is dated as of the date
first written above.

                                        OUTDOOR CHANNEL HOLDINGS, INC.,
                                        an Alaska corporation

                                        By:        /s/ Perry Massie
                                             ------------------------------
                                        Name:         Perry Massie
                                               ----------------------------
                                        Title:     Chief Executive Officer
                                                 --------------------------

                                        EMPLOYEE:

                                        /s/ William A. Owen
                                        -----------------------------------
                                        William A. Owen

                                      -5-

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                                    EXHIBIT A
                                    ---------

         VESTING DATE                       NUMBER OF VESTED SHARES
         ------------                       -----------------------
         January 13, 2004                           15,000
         April 13, 2004                             10,000
         July 13, 2004                              10,000
         October 13, 2004                           10,000
         January 13, 2005                           10,000
         April 13, 2005                             10,000
         July 13, 2005                              10,000
         October 13, 2005                           10,000
         January 13, 2006                           10,000
         April 13, 2006                             10,000
         July 13, 2006                              10,000
         October 13, 2006                           10,000
         January 13, 2007                           10,000
         April 13, 2007                             10,000
         July 13, 2007                              10,000
         October 13, 2007                           10,000
         January 13, 2008                           10,000
                                                  --------
              TOTAL:                               175,000<PAGE>

                                                                   EXHIBIT 10.12

                         OUTDOOR CHANNEL HOLDINGS, INC.

                             NON-EMPLOYEE DIRECTORS
                                STOCK OPTION PLAN

                                                      AS ADOPTED AND APPROVED BY
                                                          THE BOARD OF DIRECTORS
                                                            ON DECEMBER 18, 2003

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                                TABLE OF CONTENTS

                                                                            PAGE
                                                                            ----

1.       PURPOSE..............................................................1

2.       NON-QUALIFIED STOCK OPTIONS..........................................1

3.       ADMINISTRATION.......................................................1

4.       SHARES SUBJECT TO THE PLAN...........................................1

5.       GRANTING OF OPTIONS..................................................2

         (a)      Eligible Director...........................................2

         (b)      Option Grant................................................2

         (c)      No Option Grant Where Prohibited............................2

         (d)      Option Agreement............................................2

         (e)      Option Price................................................2

         (f)      Definition of Fair Market Value.............................2

         (g)      Nontransferability..........................................3

6.       EXERCISE OF OPTIONS..................................................3

         (a)      Vesting Schedule............................................3

         (b)      Method of Exercise..........................................3

         (c)      Payment Shares..............................................4

         (d)      Effect of Change in Control.................................4

         (e)      No Rights as Shareholder....................................5

7.       EXPIRATION OF OPTIONS................................................5

8.       ADJUSTMENT UPON CHANGES IN CAPITALIZATION............................6

9.       TAX WITHHOLDING......................................................6

10.      LAWS AND REGULATIONS.................................................6

         (a)      U.S. Securities Laws........................................6

         (b)      Local Jurisdictions.........................................6

11.      TERMINATION AND AMENDMENT OF THIS PLAN...............................6

12.      EFFECTIVE DATE.......................................................6

13.      GOVERNING LAW........................................................7

<PAGE>

                         OUTDOOR CHANNEL HOLDINGS, INC.

                    NON-EMPLOYEE DIRECTORS STOCK OPTION PLAN

         1. PURPOSE. The purpose of this Plan is to advance the interests of
Outdoor Channel Holdings, Inc., an Alaska corporation (the "Company"), and its
shareholders ("Shareholders") by (a) encouraging increased share ownership by
the Company's directors who are not employees of the Company or employees or
directors of any of its subsidiaries, (b) enhancing the Company's ability to
attract and retain the services of experienced, able and knowledgeable persons
to serve as directors and (c) providing additional incentive for directors to
contribute their best efforts to the Company's success.

         2. NON-QUALIFIED STOCK OPTIONS. The options to be granted pursuant to
this Plan ("Options" or, individually, an "Option") are nonstatutory options and
are not intended to qualify as incentive stock options under Section 422 of the
Internal Revenue Code of 1986, as amended.

         3. ADMINISTRATION. This Plan shall be administered by the Company's
Board of Directors (the "Board"). The Board shall have full authority,
consistent with this Plan, to construe and interpret this Plan and any
agreements defining the rights and obligations of the Company and Eligible
Directors (as defined below) under the Plan, to promulgate, amend and rescind
such rules and regulations with respect to this Plan as it deems desirable and
to make all other determinations necessary or desirable for the administration
of this Plan. All decisions, determinations and interpretations of the Board
shall be binding upon all Eligible Directors, the Company and all other
interested persons. The Board may, in its discretion, delegate any or all of its
authority under the Plan to a committee consisting of two or more directors of
the Company, so long as allowable under applicable law, and if such authority is
so delegated to such a committee all references to the Board in this Plan shall
mean and relate to such committee to the extent of the power so delegated. The
Company shall pay or reimburse any member of the Board, as well as any employee
or consultant who takes action in connection with this Plan at the direction of
the Board, for all expenses incurred with respect to the Plan and shall
indemnify each and every one of them for any claims, liabilities and costs
(including reasonable attorneys' fees) arising out of their good faith
performance of duties under this Plan, to the fullest extent permitted by law.
The Company may obtain liability insurance for this purpose.

         4. SHARES SUBJECT TO THE PLAN. The shares of stock to be issued upon
the exercise of Options shall be authorized shares of the Company's voting
shares of common stock ("Shares" or, individually, "Share"), either previously
unissued or previously issued but reacquired by the Company. The aggregate
number of Shares to be issued upon the exercise of Options granted under this
Plan shall be four hundred thousand (400,000), subject to adjustment as provided
in Section 8 below. Any Share subject to an Option which is cancelled,
terminated or otherwise expires without having been exercised shall again be
available to be awarded under this Plan.

<PAGE>

         5. GRANTING OF OPTIONS.

                  (a) ELIGIBLE DIRECTOR. As used herein, "Eligible Director"
means any of the Company's directors who are not (i) employees of the Company or
of any direct or indirect subsidiary of the Company, and (ii) have not been
either an employee of the Company or an employee or director of any direct or
indirect subsidiary of the Company during any of the three previous years prior
to such director's election or appointment as a director of the Company
(collectively, "Eligible Directors" and, individually, an "Eligible Director").

                  (b) OPTION GRANT. The Company shall grant an Option to
purchase fifty thousand (50,000) Shares to each person who becomes an Eligible
Director after the date this Plan is approved by the Board (but, who previously
has not been an Eligible Director under this Plan), which Option shall be
granted on the date such person is first elected or appointed as a director.

                  (c) NO OPTION GRANT WHERE PROHIBITED. No Eligible Director
shall be granted an Option under this Plan if at the time of such grant, the
grant is prohibited by applicable law or by the policies of the employer of such
person or the policies of any other company of which such person is a member of
the board of directors, a general partner or a manager.

                  (d) OPTION AGREEMENT. Each Option shall be evidenced by an
option agreement executed by the Company and the Eligible Director receiving
such Option. Each such agreement shall state the terms and conditions of the
grant, not inconsistent with this Plan, as the Board in its sole discretion
shall determine and approve.

                  (e) OPTION PRICE. The purchase price for each Share subject to
an Option shall be its Fair Market Value (as defined in paragraph 5(f) below)
determined as of the date such Option is granted (the "Grant Date").

                  (f) DEFINITION OF FAIR MARKET VALUE. For the purposes of this
Plan, "Fair Market Value" as of a certain date (the "Determination Date") means:
(i) the closing price of a share of the Company's Shares on the New York Stock
Exchange or the American Stock Exchange (collectively, the "Exchange"), on the
Determination Date, or, if shares were not traded on the Determination Date,
then on the nearest preceding trading day during which a sale occurred; or (ii)
if such stock is not traded on the Exchange but is quoted on NASDAQ or a
successor quotation system, (A) the last sales price (if the stock is then
listed as a National Market Issue under The Nasdaq National Market System) or
(B) the mean between the closing representative bid and asked prices (in all
other cases) for the stock on the Determination Date as reported by NASDAQ or
such successor quotation system; or (iii) if such stock is not traded on the
Exchange or quoted on NASDAQ but is otherwise traded in the over-the-counter
market, the mean between the representative bid and asked prices on such date;
or (iv) if subsections (i)-(iii) do not apply, the fair market value established
in good faith by the Board.

                                      -2-

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                  (g) NONTRANSFERABILITY. An Option shall be nonassignable and
nontransferable other than by will or the laws of descent and distribution.
Notwithstanding the foregoing, Options may be transferred to an Eligible
Director's family members who acquire the Options from the Eligible Director
through a gift or a domestic relations order which meets the requirements set
forth in general instruction A.1.(a)(5) of Form S-8 Registration Statement under
the United States Security Act of 1933, as amended. In the event of an Eligible
Director's death, an Option may be exercised by such director's designated
beneficiary or, in the absence of such designation, by will or the laws of
descent and distribution to the extent permitted by this Plan.

         6. EXERCISE OF OPTIONS.

                  (a) VESTING SCHEDULE. Except as provided in Section 6(d)
hereof, each Option shall become exercisable on the following schedule, provided
that the Eligible Director is then serving as a member of the Board on such
date: (i) beginning on the date three months following the Grant Date, forty
percent (40%) of the total number of Shares covered by such Option (the total
number of shares herein referred to as the "Covered Shares"), (ii) beginning on
the first anniversary of the Grant Date, an aggregate of sixty percent (60%) of
the Covered Shares, (iii) beginning on the second anniversary of the Grant Date,
an aggregate of eighty percent (80%) of the Covered Shares, and (iv) beginning
on the third anniversary of the Grant Date, and thereafter until the expiration
of such Option pursuant to Section 7 of this Plan, an aggregate of one hundred
percent (100%) of the Covered Shares. No Option shall be exercisable as to any
Shares with respect to which such Option previously has been exercised.

                  (b) METHOD OF EXERCISE. Prior to its expiration pursuant to
Section 7 hereof and in accordance with the vesting schedule outlined in Section
6(a) hereof, each Option may be exercised, in whole or in part (provided,
however, that the Company shall not be required to issue fractional shares) by
delivery of written notice of exercise to the secretary of the Company
accompanied by the full purchase price of the Shares being purchased. The
purchase price shall be paid (i) in cash or by check made payable to the
Company, or (ii) in Payment Shares (as defined in Section 6(c) hereof), the Fair
Market Value of which, as of the date of exercise, is equal to the Purchase
Price, or (iii) by any combination of cash and Payment Shares. In addition, at
the Board's discretion, the Company may allow the exercise of an Option and the
payment of the purchase price by permitting the sale of the shares underlying
the Option through a broker in accordance with a cashless exercise program
acceptable to the Company pursuant to which the holder of the Option

                                      -3-

<PAGE>

concurrently provides irrevocable instructions (A) to such holder's broker or
dealer to effect the immediate sale of the purchased shares and remit to the
Company, out of the sale proceeds available on the settlement date, sufficient
funds to cover the purchase price plus all applicable taxes required to be
withheld by the Company, if any, by reason of such exercise and (B) to the
Company to deliver the certificates for the purchased shares directly to such
broker or dealer in order to complete the sale. The Company shall not be
required to deliver any Shares pursuant to an exercise of an Option until
payment of the full purchase price therefore is received by the Company.

                  (c) PAYMENT SHARES. As used herein, "Payment Shares" means
shares of the Company's voting common stock, that (i) have been owned at least
six months (or such other longer period as determined by the Company) by the
Eligible Director who is purchasing Shares pursuant to the exercise of an
Option, (ii) are, at the time of such transfer, free and clear of any and all
claims, pledges, liens and encumbrances, or any restrictions which would in any
manner restrict the transfer of such shares to or by the Company, and (iii) are
duly endorsed for transfer to the Company.

                  (d) EFFECT OF CHANGE IN CONTROL. In the event of a Change in
Control of the Company (as defined below), all outstanding Options held by each
Eligible Director on the date of such Change in Control shall be immediately
exercisable in full, notwithstanding the vesting schedule of Section 6(a)
hereof.

                  For purposes of this Plan, a "Change in Control" of the
Company shall mean a change in control of a nature that would be required to be
reported in response to Item 1 of Form 8-K required to be filed pursuant to the
Securities Exchange Act of 1934, as amended (the "Exchange Act"); provided that,
without limitation, such a Change in Control shall be deemed to have occurred
if:

                  (i) the Shareholders of the Company approve a definitive
         agreement to sell, transfer, or otherwise dispose of all or
         substantially all of the Company's assets and properties; or

                  (ii) any "person" (as such term is used in Section 13(d) and
         14(d) of the Exchange Act), other than the Company, any subsidiary of
         the Company or any "person" who as of the date this Plan is adopted by
         the Board, is a director or officer of the Company (including
         affiliates of such directors and officers and trusts established by
         such affiliates or persons), is or becomes the "beneficial owner" (as
         defined in Rule 13d-3 under the Exchange Act), directly or indirectly,
         of securities of the Company representing fifty percent (50%) or more
         of the combined voting power of the Company's then outstanding
         securities provided, however, that the following shall not constitute a
         "Change in Control" of the Company:

                           (a) any acquisition directly from the Company
         (excluding any acquisition resulting from the exercise of a conversion
         or exchange privilege in respect of outstanding convertible or
         exchangeable securities);

                           (b) any acquisition by an employee benefit plan (or
         related trust) sponsored or maintained by the Company or any
         corporation controlled by the Company; or

                                      -4-

<PAGE>

                           (c) upon the death of any person who as of the date
         of this Plan is a director or officer of the Company, the transfer (a)
         by testamentary disposition or the laws of intestate succession to the
         estate or the legal beneficiaries or heirs of such person, or (b) by
         the provisions of any living trust to the named current income
         beneficiaries thereof of the securities of the Company beneficially
         owned by such director or officer of the Company; or

                  (iii) during any period of two consecutive years during the
         term of this Plan, individuals who at the beginning of such period
         constitute the Board cease for any reason to constitute at least a
         majority thereof, unless the election of each director who was not a
         director at the beginning of such period has been approved in advance
         by directors representing at least two-thirds of the directors then in
         office who were directors at the beginning of the period; or

                  (iv) the Shareholders of the Company approve the dissolution
         of the Company or a definitive agreement for a merger, reorganization
         or consolidation involving the Company other than a merger,
         reorganization or consolidation in which holders of the Company's
         voting common stock, immediately prior to such transaction own, either
         directly or indirectly, fifty percent (50%) or more of the equity
         interests or combined voting power of the surviving corporation or
         entity (or its parent company) immediately following such transaction.

                  (e) NO RIGHTS AS SHAREHOLDER. No one shall have any rights as
a shareholder of the Company with respect to any Shares underlying an Option
until such time as such shares are issued by the Company pursuant to the valid
exercise of an Option. Nothing in this Plan shall be construed as giving any
Eligible Director any right to continue to remain a member of the Board.

         7. EXPIRATION OF OPTIONS. Except as hereinafter provided, each Option
shall expire on the earlier of (a) the tenth anniversary of the Grant Date of
such Option or (b) the date that the Eligible Director holding such Option
ceases to be a member of the Board; provided, however, that to the extent any
unexpired Options are otherwise exercisable on the date that an Eligible
Director ceases to be a member of the Board for any reason other than "cause",
death or retirement, such Options shall remain exercisable for six months
following the last day of the Eligible Director's Board membership and shall
expire if not exercised within said six-month period. If Board membership ceases
on account of death or retirement, all unexpired Options held by the Eligible
Director on the last day of Board membership, which are then exercisable shall
remain exercisable for one year following the last day of the Eligible
Director's Board membership and shall expire if not exercised within said
one-year period. All Options held by an Eligible Director whose membership on
the Board ends after the occurrence of "cause" shall expire immediately on the
last date of membership. "Cause", for the purposes of this paragraph 7, means
any (i) act or omission for which indemnification of the Eligible Director is
prohibited by the laws of the jurisdiction of incorporation of the Company, (ii)
conviction of a felony, or (iii) misconduct involving personal profit to the
Eligible Director to the material detriment of the Company or its subsidiaries.

                                      -5-

<PAGE>

         8. ADJUSTMENT UPON CHANGES IN CAPITALIZATION. If a reorganization,
recapitalization, stock split, stock dividend, combination of shares, merger,
consolidation, rights offering, or any other change in the corporate structure
or shares of voting common stock of the Company occurs, the number and kind of
shares authorized by this Plan, and the number, Option price and kind of shares
covered by the Options granted hereunder, shall be automatically adjusted as
required in order to prevent an unfavorable effect upon the value of the Shares
covered by the then outstanding Options and Shares covered by Options
subsequently granted.

         9. TAX WITHHOLDING. Any exercise of an Option pursuant to this Plan
shall be subject to withholding of state and federal income taxes, FICA tax or
other taxes to the extent required by applicable law.

         10. LAWS AND REGULATIONS.

                  (a) U.S. SECURITIES LAWS. This Plan, the grant and exercise of
Options under this Plan, and the obligation of the Company to sell or deliver
any of its securities (including, without limitation, Options and Shares) under
this Plan shall be subject to all applicable laws, regulations and rules. In the
event that the Shares are not registered under the Securities Act of 1933, as
amended (the "Act"), or any applicable state securities laws prior to the
delivery of such Shares, the Company may require, as a condition to the issuance
thereof, that the persons to whom Shares are to be issued represent and warrant
in writing to the Company that such Shares are being acquired by him or her for
investment for his or her own account and not with a view to, for resale in
connection with, or with an intent of participating directly or indirectly in,
any distribution of such Shares within the meaning of the Act, and a legend to
that effect may be placed on the certificates representing the Shares.

                  (b) LOCAL JURISDICTIONS. The Company may adopt rules and
procedures relating to the operation and administration of this Plan to
accommodate the specific requirements of local laws. The Company may adopt
sub-plans applicable to particular locations.

         11. TERMINATION AND AMENDMENT OF THIS PLAN. The Board may at any time
terminate this Plan or may at any time or times amend this Plan or amend any
outstanding Options for the purpose of satisfying the requirements of any
changes in applicable laws or regulations or for any other purpose which at the
time may be permitted by law.

         12. EFFECTIVE DATE. This Plan shall become effective on December 18,
2003, the date of approval by the Board; provided, however, that this Plan shall
be submitted to the Shareholders for approval (or ratification), and if not
approved (or ratified) by the Shareholders within one year from the date of
approval by the Board, this Plan shall be of no force and effect. Options
granted under this Plan before approval of this Plan by the Shareholders shall
be granted subject to such approval (or ratification) and shall not be
exercisable before such approval (or ratification).

                                      -6-

<PAGE>

                  13. GOVERNING LAW. This Plan, and the related option
agreements, shall be governed by and enforced and construed in accordance with
the internal substantive laws (and not the laws of conflicts of laws) of
California.

                                      -7-

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