1996 STOCK OPTION PLAN
NAME AND PURPOSE
1.1 Name. The name of this Plan is the "QuesTech, Inc.
1996 Stock Option Plan."
1.2 Purpose. The Company has established this Plan to
attract, retain, motivate and reward Employees and other
individuals and to encourage ownership of the Company's Common
Stock by them.
DEFINITIONS OF TERMS AND RULES OF CONSTRUCTION
2.1 General Definitions. The following words and
phrases, when used in the Plan, unless otherwise specifically
defined or unless the context clearly otherwise requires, shall
have the following respective meanings:
(a) Affiliate. A Parent or Subsidiary of the
(b) Agreement. The document which evidences the
grant of an Option under the Plan and which sets forth the
terms, conditions and provisions of, and restrictions relating
to, such Option.
(c) Board. The Board of Directors of the Company.
(d) Change of Control. The acquisition, without
the approval of the Board, by any person or entity, other than
the Company or a Related Entity, of more than 20% of the
outstanding shares of the Company's voting common stock
through a tender offer, exchange offer or otherwise; the
liquidation or dissolution of the Company following a sale or
other disposition of all or substantially all of its assets;
a merger or consolidation involving the Company which results
in the Company not being the surviving parent corporation; or
any time during any two-year period in which individuals who
constituted the Board at the start of such period (or whose
election was approved by at least two-thirds of the then
members of the Board who were members at the start of the
two-year period) do not constitute at least 50% of the Board
for any reason. A Related Entity is the Parent, a Subsidiary
or any employee benefit plan (including a trust forming a part
of such a plan) maintained by the Parent, the Company or a
(e) Code. The Internal Revenue Code of 1986, as
amended. Any reference to the Code includes the regulations
promulgated pursuant to the Code.
(f) Company. QuesTech, Inc.
(g) Committee. The Committee described in
(h) Common Stock. The Company's common stock which
presently has a par value of $0.05 per Share.
(i) Effective Date. The date that the Plan is
approved by the shareholders of the Company. Any grants of
Options prior to the approval by the shareholders of the
Company shall be void if such approval is not obtained.
(j) Employee. Any person employed by the Employer.
(k) Employer. The Company and all Affiliates.
(l) Exchange Act. The Securities Exchange Act of
1934, as amended.
(m) Fair Market Value. The closing price of a
share of Common Stock on the NASDAQ on a given date, or, in
the absence of sales on a given date, the closing price on the
NASDAQ on the last day on which a sale occurred prior to such
date, or, if the Common Stock is not then included on the
NASDAQ, such fair market value as the Board may fairly
(n) Fiscal Year. The taxable year of the Company
which is the calendar year.
(o) ISO. An Incentive Stock Option as defined in
Section 422 of the Code.
(p) NQSO. A Non-Qualified Stock Option, which is
an Option that does not qualify as an ISO.
(q) Option. An option to purchase Shares granted
under the Plan, whether an ISO or an NQSO.
(r) Parent. Any corporation (other than the
Company or a Subsidiary) in an unbroken chain of corporations
ending with the Company, if, at the time of the grant of an
Option, each of the corporations (other than the Company or a
Subsidiary) owns stock possessing 50% or more of the total
combined voting power of all classes of stock in one of the
other corporations in such chain.
(s) Participant. An individual who is granted an
Option under the Plan.
(t) Plan. The QuesTech, Inc. 1996 Stock Option
Plan and all amendments and supplements to it.
(u) Rule 16b-3. Rule 16b-3 promulgated by the SEC,
as amended, or any successor rule in effect from time to time.
(v) SEC. The Securities and Exchange Commission.
(w) Share. A share of Common Stock.
(x) Subsidiary. Any corporation, other than the
Company, in an unbroken chain of corporations beginning with
the Company if, at the time of grant of an Option, each of the
corporations, other than the last corporation in the unbroken
chain, owns stock possessing 50% or more of the total combined
voting power of all classes of stock in one of the other
corporations in such chain.
2.2 Other Definitions. In addition to the above
definitions, certain words and phrases used in the Plan and any
Agreement may be defined in other portions of the Plan or in such
2.3 Conflicts in Plan. In the case of any conflict in
the terms of the Plan relating to an Option, the provisions in the
ARTICLE of the Plan which specifically grants such Option shall
control those in a different ARTICLE.
SHARES SUBJECT TO THE PLAN
3.1 Number of Shares. The number of Shares for which
Options may be granted under the Plan shall initially be 200,000
Shares. Such Shares may be authorized but unissued Shares, Shares held in the
treasury, or both, or may be shares which are held in trust in the
Company's Stock Employee Compensation Trust ("SECT").
3.2 Reusage. If an Option expires or is terminated,
surrendered, forfeited, or canceled without having been fully
exercised, the Shares with respect to which such Option has not
been exercised at the time of termination, surrender, forfeiture,
or cancellation shall again be available for use under the Plan.
3.3 Adjustments. If there is any change in the Common
Stock of the Company by reason of any stock dividend, spin-off,
split-up, spin-out, recapitalization, merger, consolidation,
reorganization, combination or exchange of shares, number and class
of shares available for Options and the number of Shares subject to
outstanding Options, and the price thereof, as applicable, shall be
appropriately adjusted by the Committee.
Options may be granted only to Employees, employees and
owners of entities which are not Affiliates but which have a direct
or indirect ownership interest in an Employer or in which an
Employer has a direct or indirect ownership interest, individuals
who, and employees and owners of entities which, are customers and
suppliers of an Employer, individuals who, and employees and owners
of entities which, render services to an Employer, and individuals
who, and employees and owners of entities, which have ownership or
business affiliations with any individual or entity previously
described. The Participants and the Options they receive under the
Plan shall be determined solely by the Committee. In making its
determinations, the Committee shall consider past, present and
expected future contributions of Participants and potential
Participants to the Employer, including, without limitation, the
performance of, or the refraining from the performance of,
5.1 Committee. The Plan shall be administered by the
Committee. The Committee shall consist of two or more members of
the Board. At least two members of the Committee shall be "Non-Employee
Directors" as defined in Rule 16b-3 (or shall otherwise
meet the requirements for Committee membership under the then
effective version of Rule 16b-3) and "outside directors" as defined
by Section 162(m)(4)(C)(i) of the Code. The members of the
Committee shall be appointed by and shall serve at the pleasure of
the Board, which may from time to time appoint members in
substitution for members previously appointed and fill vacancies,
however caused, in the Committee. The Committee may select one of
its members as its Chairman and shall hold its meetings at such
times and places as it may determine. A majority of its members
shall constitute a quorum. All determinations of the Committee
shall be made by a majority of its members. Any decision or
determination reduced to writing and signed by a majority of the
members shall be fully as effective as if it had been made by a
majority vote at a meeting duly called and held.
5.2 Authority. Subject to the terms of the Plan, the
Committee shall have discretionary authority to:
(a) determine the individuals to whom Options are
granted, the type and amounts of Options to be granted and the
time of all such grants;
(b) determine the terms, conditions and provisions
of, and restrictions relating to, each Option granted;
(c) interpret and construe the Plan and all
(d) prescribe, amend and rescind rules and
regulations relating to the Plan;
(e) determine the content and form of all
(f) determine all questions relating to Options
under the Plan;
(g) maintain accounts, records and ledgers relating
(h) maintain records concerning its decisions and
(i) employ agents, attorneys, accountants or other
persons for such purposes as the Committee considers necessary
(j) take, at any time, any action permitted by
Section 9.6 irrespective of whether any Change of Control has
occurred or is imminent; and
(k) do and perform all acts which it may deem
necessary or appropriate for the administration of the Plan
and carry out the purposes of the Plan.
5.3 Delegation. Except as required by Rule 16b-3 with
respect to grants of Options to individuals who are subject to
Section 16 of the Exchange Act or as otherwise required for
compliance with Rule 16b-3 or other applicable law, the Committee
may delegate all or any part of its authority under the Plan to any
Employee, Employees or committee.
5.4 Adjudication of Claims. The Committee shall have
discretionary authority to make all determinations as to the right
to benefits under the Plan. In the event that a Participant
believes he has not received the benefits to which he is entitled
under the Plan, a claim shall be made in writing to the Committee.
The claim shall be reviewed by the Committee. If the claim is
approved or denied, in full or in part, the Committee shall provide
a written notice of approval or denial within 90 days with, in the
case of a denial, the specific reasons for the denial and specific
reference to the provisions of the Plan and/or Agreement upon which
the denial is based. A claim shall be deemed denied if the
Committee does not take any action within the aforesaid 90 day
period. If a claim is denied or deemed denied and a review is
desired, the Participant shall notify the Committee in writing
within 60 days of the receipt of notice of denial or the date on
which the claim is deemed to be denied, as the case may be. In
requesting a review, the Participant may review the Plan or any
document relating to it and submit any written issues and comments
he may deem appropriate. The Committee shall then review the claim
and provide a written decision within 60 days. This decision, if
adverse to the Participant, shall state the specific reasons for
the decision and shall include reference to specific provisions of
the Plan and/or Agreement on which the decision is based. The
Committee's decision on review shall be final.
6.1 Types of Options. The Committee shall have
authority to grant both ISOs and NQSOs under the Plan.
6.2 Grant of ISOs and Option Price. Each ISO must be
granted to an Employee and granted within ten years from the date
of adoption of the Plan by the Board. The purchase price for
Shares under any ISO shall be no less than the Fair Market Value of
the Shares at the time the Option is granted.
6.3 Other ISO Terms. In addition to the requirements of
(a) Each ISO, by its terms,. cannot be exercisable
after the expiration of 10 years from the date such the ISO is
(b) Each ISO, by its terms, cannot be transferable
by the optionee otherwise than by will or the laws of descent and
distribution, and must be excisable, during his lifetime, only by
(c) The optionee, at the time the ISO is granted,
cannot own stock possessing more than 10 percent of the total
combined voting power of all classes of stock of the Company or its
Affiliates unless, at the time the Option is granted, the purchase
price is at least 110 percent of the Fair Market Value of the
Shares subject to the Option and such Option, by its terms, is not
exercisable after the expiration of five years from the date such
Option is granted.
6.4 $100,000 Per Year Limitation for ISOs. To the
extent that the aggregate Fair Market Value of Shares with respect
to which ISOs (determined without regard to this Section 6.4) are
exercisable for the first time by any individual during any
calendar year (under all plans of the Company and its Affiliates)
exceeds $100,000, such Options shall be treated as options which
are not ISOs. The foregoing sentence shall be applied by taking
Options into account in the order in which they were granted, and
the Fair Market Value of any Shares shall be determined as of the
time the Option with respect to such Shares is granted.
6.5 NQSOs. The terms of each NQSO shall provide that
such Option will not be treated as an ISO. The purchase price for
Shares under any NQSO shall be no less than the Fair Market Value
of the Shares at the time the Option is granted.
6.6 Determination by Committee. Except as otherwise
provided in Section 6.2 through Section 6.5, the terms of all
Options shall be determined by the Committee.
AGREEMENTS AND CERTAIN OPTIONS
7.1 Grant Evidenced by Agreement. The grant of any
Option under the Plan shall be evidenced by an Agreement which
shall describe the specific Option granted and the terms and
conditions of the Option. The granting of any Option shall be
subject to, and conditioned upon, the recipient's execution of any
Agreement required by the Committee. Except as otherwise provided
in an Agreement, all capitalized terms used in the Agreement shall
have the same meaning as in the Plan. The Agreement shall be
subject to all of the terms of the Plan.
7.2 Provisions of Agreement. Each Agreement shall
contain such provisions that the Committee shall determine to be
necessary, desirable and appropriate for the Option granted which
may include, but need not be limited to, the following with respect
to any Option: description of the type of Option; the Option's
duration; its transferability; its exercise price, the exercise
period and the person or persons who may exercise the Option; the
effect upon such Option of the Participant's death or termination
of employment; the Option's conditions; when, if, and how any
Option may be forfeited, converted into another Option, modified,
exchanged for another Option, or replaced; and the restrictions on
any Shares purchased under the Option.
PAYMENT, DIVIDENDS, AND WITHHOLDING
8.1 Payment. Upon the exercise of an Option, the amount
due the Company shall be paid:
(a) in cash;
(b) by the tender to the Company of Shares owned by
the optionee and registered in his name having a Fair Market
Value equal to the amount due to the Company;
(c) in cash, but by means of a so-called "cashless
exercise" of an Option; and/or
(e) by any combination of the payment methods
specified in (a), (b) and (c) above.
Notwithstanding the foregoing, any method of payment other than (a)
may be used only with the consent of the Committee or if and to the
extent so provided in an Agreement. The proceeds of the sale of
Common Stock purchased pursuant to an Option shall be added to the
general funds of the Company or to the Shares held in treasury, as
the case may be, and used for the corporate purposes of the Company
as the Board shall determine.
8.2 Dividend Equivalents. Grants of Options may include
dividend equivalent payments or dividend credit rights.
8.3 Withholding. Unless otherwise provided in an
Agreement, the Company shall, at the time any Option is exercised,
withhold from the Shares issuable upon the exercise of an Option,
any amount necessary to satisfy federal, state and local income
and/or other tax withholding requirements with respect to the
exercise of such Option.
AMENDMENT, TERMINATION AND CHANGE OF CONTROL
9.1 Amendment. The Board shall have the sole right and
power to amend the Plan at any time and from time to time,
provided, however, that the Board may not amend the Plan without
approval of the shareholders of the Company:
(a) in a manner which would cause Options which are
intended to qualify as ISOs to fail to qualify;
(b) in a manner which would cause grants under the
Plan to fail to meet the requirements of Rule 16b-3; or
(c) in a manner which would violate applicable law.
9.2 Term. The Plan shall commence as of the Effective
Date and, subject to the terms of the Plan, including those
requiring approval by the shareholders of the Company and those
limiting the period over which ISOs may be granted, shall continue
in full force and effect until terminated.
9.3 Termination. The Plan may be terminated at any time
by the Board.
9.4 Effect of Amendment or Termination. Subject to the
provisions of Section 9.5, the amendment or termination of the Plan
shall not adversely affect a Participant's right to any Option
granted prior to such amendment or termination.
9.5 Committee's Right. Any Option granted may be
converted, modified, forfeited or canceled, in whole or in part, by
the Committee if and to the extent permitted in the Plan or
applicable Agreement or with the consent of the Participant to whom
such Option was granted.
9.6 Change of Control. In order to maintain a
Participant's rights in the event of a Change in Control, the
Committee, in its sole discretion, may, in any Agreement evidencing
an Option, or at any time prior to, or simultaneously with or after
a Change in Control, provide such protection as it may deem
necessary. Without, in any way, limiting the generality of the
foregoing sentence or requiring any specific protection, the
(a) provide for the acceleration of any time
periods relating to the exercise of such Option so that such
Option may be exercised in full on or before a date fixed by
(b) provide for the purchase of such Option, upon
the Participant's request, for an amount of cash equal to the
amount which could have been attained upon the exercise of
such Option had such Option been currently exercisable;
(c) make such adjustment to the Option then
outstanding as the Committee deems appropriate to reflect such
transaction or change; and/or
(d) cause the Options then outstanding to be
assumed, or new Options substituted therefor, by the surviving
corporation in such change.
10.1 Headings and Captions. The headings and captions to
the several Articles and Sections contained in the Plan are
included only for convenience and shall not be construed as a part
of the Plan or in any respect affect or modify its provisions.
10.2 Number and Gender. The masculine and neuter,
wherever used in the Plan, shall refer to either the masculine,
neuter or feminine; and, unless the context otherwise requires, the
singular shall include the plural and the plural the singular.
10.3 Governing Law. This Plan shall be construed and
administered in accordance with the laws of the State of Virginia.
10.4 Purchase for Investment. The Committee may require
each person purchasing Shares pursuant to an Option to represent to
and agree with the Company in writing that such person is acquiring
the Shares for investment and without a view to distribution or
resale. The certificates for such Shares may include any legend
which the Committee deems appropriate to reflect any restrictions
on transfer. All certificates for Shares delivered under the Plan
shall be subject to such stock-transfer orders and other
restrictions as the Committee may deem advisable under all
applicable laws, rules and regulations, and the Committee may cause
a legend or legends to be put on any such certificates to make
appropriate references to such restrictions.
10.5 No Employment Contract. The adoption of the Plan
shall not confer upon any Employee any right to continued
employment nor shall it interfere in any way with the right of the
Employer to terminate the employment of any of its Employees at any
10.6 No Effect on Other Benefits. The grant of Options
under the Plan shall have no effect on any benefits to which a
Participant may be entitled from the Employer, under another plan
or otherwise, or preclude a Participant from receiving any such
10.7 Section 162(m) Fail-Safe Provision. If Code Section
162(m) is applicable to the Company and to a Participant, ISOs and
NQSOs are intended to meet the requirements of "other performance-based
compensation" under Code Section 162(m)(4)(C), so that any
remuneration resulting from the grant or exercise of any such
Option will not be considered "applicable employee remuneration"
within the meaning of Code Section 162(m)(4). If and to the extent
any provision of the Plan or action by the Board, Committee, or the
Committee's designee is contrary to such intention, it shall be
deemed null and void.
STOCK OPTION PLAN FOR NON-EMPLOYEE DIRECTORS
1. Purpose. The purpose of the QuesTech, Inc. Stock Option
Plan for Non-Employee Directors ("Plan") is to increase the
proprietary interest of Non-Employee Directors in QuesTech,
Inc. ("Corporation") by granting them non-qualified options
("Options") to purchase shares ("Shares") of common stock,
$0.05 per share par value, of the Corporation ("Common
Stock") that will promote long-term shareholder value
through ownership of Common Stock.
2. Administration. The Plan shall be administered by the Board
of Directors. Grants of Options under the Plan shall be
automatic as provided in Section 5 and, upon the approval of
the Board of Directors with an interested director recusing
himself or herself, in the discretion of the Board of
Directors as provided in Section 6. The Board shall have
full authority to interpret the plan, to promulgate such
rules and regulations with respect to the Plan as it deems
desirable and to make all other determinations necessary or
appropriate for the administration of the Plan, and such
determinations shall be final and binding upon all persons
having an interest in the Plan.
3. Participation. Each member of the Board of Directors of the
Corporation who is not an employee of the Corporation or any
of its subsidiaries at the date of each grant ("Non-Employee
Director") shall be eligible to participate in the Plan.
4. Available Shares. The number of Shares available for grants
under the Plan shall not exceed 50,000 shares, subject to
adjustment as provided in Section 11. Any Shares issued
pursuant to Options ("Optioned Shares") may consist, in
whole or in part, of authorized and unissued Shares or
Shares in the Corporation's treasury. All Options granted
under the Plan shall be non-qualified options not entitled
to special tax treatment under Section 422 of the Internal
Revenue Code of 1986, as amended.
5. Formula Awards under the Plan.
(a) Grant of Formula Award Options. Each individual who
becomes a Non-Employee Director (but excluding any Non-Employee Director
re-elected), shall, on the first anniversary of the first trading
day coinciding with or immediately following election to the
Board, automatically be granted an Option for 5,000 shares
all of which shall vest at the rate of 20 percent per year each year
following the date of grant. Each Non-Employee Director upon
re-election shall, on the first trading day coinciding with or immediately
following such reelection, automatically be granted an
Option to acquire 5,000 shares, 20 percent of which vests each year
following the date of grant and the balance one year after the date of
grant. The written agreement evidencing each Option shall be dated as
of the applicable date of grant. Each Non-Employee Director accepting
an Option shall execute and return a copy of the agreement to the
(b) Option Exercise Price. The exercise price per Share
("Option Price") of the formula award Option described above
in Section 5(a) shall be 100% of the Fair Market Value of a
Share on the business day immediately preceding the date of
grant. "Fair Market Value" as of any date shall be the last
reported sale price, regular way, of the Shares on any day
or, in case no such reported sale takes place on such day,
the average of the reported closing bid and asked prices,
regular way, in either case on the principal national
securities exchange on which the Shares are listed or, if
the Shares are not listed on a national securities exchange
and are listed on the Nasdaq Stock Market, the sale price
determined in the same fashion or, if the Shares are not so
listed on any of the foregoing, the average of the bid and
asked prices on such day as furnished by dealers in the
Shares in the over-the-counter market. All calculations of
the current market price shall be made to the nearest cent.
(c) Term of Option. Each formula award Option shall expire
ten (10) years from the date of grant.
(d) Exercise of Option. Each Option granted under Section
5(a) to (i) a newly elected Non-Employee Director shall be
exercisable six months from its date of grant and (ii) a re-elected
Director shall be exercisable as provided in Section 5(a) above.
6. Other Grants. The Board may make such other, discretionary
Option grants to Non-Employee Directors as it may determine,
so long as such Options are evidenced by a written agreement
setting forth the terms and conditions of such Option, which
shall in all events be consistent with the terms of this
7. Manner of Exercise. An exercisable Option, or any
exercisable portion thereof, may be exercised solely by
delivery to the Secretary of the Corporation at his or her
office of all of the following:
(a) Notice in writing signed by the Optionee or other
person then entitled to exercise an Option or portion
thereof, stating that the Option or portion is
exercised, such notice complying with all applicable
rules established by the Board;
(b) Such representations and documents as the Board,
in its absolute discretion, deems necessary or
advisable to effect compliance with all applicable
provisions of the Federal Securities Act of 1933, as
amended ("Federal Securities Act"), and any other
Federal or state securities laws or regulations. The
Board may, in its absolute discretion, also take
whatever action it deems appropriate to effect such
compliance, including without limitation, placing
legends on share certificates and issuing stop-transfer
orders to transfer agents and registrars; and
(c) Full cash payment of the Option Price for the
Optioned Shares with respect to which such Option or
portion is thereby exercised and which are to be
delivered to him or her pursuant to such exercise.
Such payment need not accompany the written notice of
exercise if the Optionee, either (a) in the notice of
exercise directs that the stock certificate or
certificates for the Optioned Shares as to which the
Option is exercised be delivered to a broker-dealer
registered with the Securities and Exchange Commission
that is a member of the New York Stock Exchange or any
other broker-dealer acceptable to the Board, as the
agent for the Optionee, which broker-dealer delivers to
the Corporation its unconditional and irrevocable
undertaking that, at the time such stock certificate or
certificates are delivered, such broker-dealer will pay
to the Corporation an amount in cash equal to such
payment, plus the amount ("withholding amount") of all
federal, state and/or local taxes of any kind which the
Corporation is required to withhold with respect to the
exercise of the Option or (b) furnish with said notice
(i) Shares (endorsed in favor of the Corporation)
having a Fair Market Value equal to the amount of such
payment or (ii) instructions that the Corporation
withhold from the Optioned Shares to be delivered a
number of Optioned Shares having a fair market value
equal to the Option Price, plus (in each case), the
8. Conditions to Issuance of Stock Certificates. The
Corporation shall not be required to issue or deliver any
certificate or certificates for Optioned Shares prior to
fulfillment of all of the following conditions:
(a) The completion of any registration or other
qualification of such Shares under any Federal or state
law or under the rulings or regulations of the
Securities and Exchange Commission or any other
governmental regulatory body, which the Corporation
shall, in its absolute discretion, deem necessary or
(b) The obtaining of any approval or other clearance
from any state or federal governmental agency which the
Corporation shall, in its absolute discretion,
determine to be necessary or advisable;
(c) The provision for any income tax withholding which
the Corporation shall, in its absolute discretion,
determine to be necessary or advisable; and
(d) The lapse of such reasonable period of time
following the exercise of the Option as the Corporation
may determine, in its absolute discretion, from time to
time to be necessary or advisable for reasons of
9. Rights as Stockholders. An Optionee shall not be, nor have
any of the rights of, a stockholder of the Corporation in
respect to any shares of Common Stock which may be purchased
upon the exercise of any option or portion thereof unless
and until certificates representing such shares have been
issued by the Corporation.
10. Non-transferability. An Option shall be non-assignable and
non-transferable by a Non-Employee Director other than by
will or the laws of descent and distribution. A Non-Employee Director
shall forfeit any Option assigned or transferred, voluntarily or
involuntarily, other than as
permitted under this Section. An Option may be exercised
during the Non-Employee Director's lifetime only by such
person or his or her guardian or legal representative.
11. Adjustments. In the event of a stock dividend or stock
split, or combination or other reduction in the number of
issued Shares, a merger, consolidation, reorganization,
recapitalization, sale or exchange of substantially all
assets or dissolution of the Corporation, then appropriate
adjustments shall be made in the shares and number of Shares
subject to and authorized by this Plan and the Option prices
specified, in order to prevent dilution or enlargement of
the rights of the Non-Employee Directors under the Plan.
12. Amendment of the Plan. The Board of Directors may suspend
or terminate the Plan or any portion thereof at any time,
and the Board of Directors may amend the Plan from time to
time as may be deemed to be in the best interests of the
Corporation; provided, however, that no such amendment,
alteration or discontinuation shall be made (a) that would
impair the rights of a Non-Employee Director with respect to
Options theretofore awarded, without such person's consent,
or (b) without the approval of the stockholders if such
approval is necessary to comply with any legal, tax or
regulatory requirement, including any approval requirement
which is a prerequisite for exemptive relief from Section
16(b) of the Securities Exchange Act of 1934, as amended.
13. Miscellaneous Provisions. Neither the Plan nor any action
taken hereunder shall be construed as giving any Non-Employee Director any
right to be nominated for re-election to the Board.
14. Effective Date and Duration of Plan. The Plan shall be
effective as of November 1, 1996 and shall expire ten years
from the effective date hereof unless earlier terminated by