1995 STOCK OPTION PLAN

 CERPROBE CORPORATION
                             1995 STOCK OPTION PLAN

                                    ARTICLE I
                                     General

         1.1 Purpose of Plan; Term

                  (a)  Adoption.  On May 9, 1995,  the Board of  Directors  (the
"Board")  of  Cerprobe  Corporation,  a Delaware  corporation  (the  "Company"),
adopted  this stock  option plan to be known as the 1995 Stock  Option Plan (the
"Plan").

                  (b) Defined Terms. All initially capitalized terms used hereby
shall have the meaning set forth in Article V hereto.

                  (c)  General  Purpose.  The  Plan  shall be  divided  into two
programs: the Discretionary Grant Program and the Automatic Grant Program.

                           (i)  Discretionary  Grant  Plan.  The  purpose of the
Discretionary  Grant  Program is to further the interests of the Company and its
stockholders by encouraging  key persons  associated with the Company (or Parent
or Subsidiary  Corporations) to acquire shares of the Company's  Stock,  thereby
acquiring a  proprietary  interest in its  business  and an  increased  personal
interest  in  its  continued  success  and  progress.   Such  purpose  shall  be
accomplished by providing for the  discretionary  granting of options to acquire
the  Company's  Stock  ("Discretionary  Options"),  the direct  granting  of the
Company's  Stock ("Stock  Awards"),  the granting of stock  appreciation  rights
("SARs"),  or the granting of other cash awards ("Cash  Awards")  (Stock Awards,
SARs and Cash Awards shall be collectively referred to herein as "Awards").

                           (ii)  Automatic  Grant  Program.  The  purpose of the
Automatic  Grant Program is to promote the interests of the Company by providing
non-employee  members of the  Company's  Board of  Directors  (the  "Board") the
opportunity  to acquire a  proprietary  interest,  or otherwise  increase  their
proprietary  interest,  in the Company and to thereby have an increased personal
interest  in  its  continued  success  and  progress.   Such  purpose  shall  be
accomplished  by  providing  for the  automatic  grant of options to acquire the
Company's Stock ("Automatic Options").

                  (d) Character of Options.  Discretionary Options granted under
this Plan to  employees  of the Company (or Parent or  Subsidiary  Corporations)
that are intended to qualify as an  "incentive  stock option" as defined in Code
ss. 422  ("Incentive  Stock Option") will be specified in the  applicable  stock
option agreement. All other Options granted under this Plan will be nonqualified
options.

                  (e) Rule  16b-3  Plan.  With  respect  to  persons  subject to
Section 16 of the Securities  Exchange Act of 1934, as amended ("1934 Act"),  to
the  extent  that  the  Board  delegates  it  administration  rights  under  the
Discretionary  Grant  Program to the Senior  Committee,  as described in Section
1.3(a)  hereof,  the Plan is thereafter  intended to comply with all  applicable
conditions  of Rule 16b-3 (and all  subsequent  revisions  thereof)  promulgated
under the 1934 Act. In such instance, to the extent any provision of the Plan or
action by a Plan  Administrator  fails to so comply, it shall be deemed null and
void,  to the  extent  permitted  by law  and  deemed  advisable  by  such  Plan
Administrator. In addition, the 
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Board may amend  the Plan  from time to time as it deems  necessary  in order to
meet the requirements of any amendments to Rule 16b-3 without the consent of the
shareholders of the Company.

                  (f)  Duration  of  Plan.  The  term of the  Plan  is 10  years
commencing  on the date of  adoption  of the Plan by the Board as  specified  in
Section 1.1(a) hereof. No Option or Award shall be granted under the Plan unless
granted within 10 years of the adoption of the Plan by the Board, but Options or
Awards outstanding on that date shall not be terminated or otherwise affected by
virtue of the Plan's expiration.

         1.2 Stock and Maximum Number of Shares Subject to Plan.

                  (a)  Description  of Stock and Maximum Shares  Allocated.  The
stock subject to the provisions of the Plan and issuable upon the grant of Stock
Awards or upon the exercise of SARs or Options  granted under the Plan is shares
of the Company's common stock, $.05 par value per share (the "Stock"), which may
be  either  unissued  or  treasury  shares,  as the  Board may from time to time
determine.  Subject to  adjustment  as  provided  in  Section  4.1  hereof,  the
aggregate number of shares of Stock covered by the Plan and issuable  thereunder
shall be 500,000 shares of Stock.

                  (b)   Calculation  of  Available   Shares.   For  purposes  of
calculating  the maximum number of shares of Stock which may be issued under the
Plan:  (i) the shares issued  (including  the shares,  if any,  withheld for tax
withholding  requirements)  upon exercise of an Option shall be counted and (ii)
the shares issued  (including the shares,  if any,  withheld for tax withholding
requirements)  as a result of a grant of a Stock  Award or an exercise of an SAR
shall be counted.

                  (c)  Restoration  of Unpurchased  Shares.  If an Option or SAR
expires or  terminates  for any reason  prior to its exercise in full and before
the term of the Plan  expires,  the shares of Stock  subject  to, but not issued
under,  such Option or SAR shall,  without  further action or by or on behalf of
the Company, again be available under the Plan.

         1.3 Approval; Amendments.

                  (a) Approval by  Stockholders.  The Plan shall be submitted to
the  stockholders  of the  Company  for their  approval  at a regular or special
meeting to be held within 12 months after the adoption of the Plan by the Board.
Stockholder  approval shall be evidenced by the affirmative  vote of the holders
of a majority of the shares of the  Company's  Common Stock present in person or
by proxy and  voting at the  meeting.  The  Automatic  Grant  Program  shall not
commence until the date such stockholder  approval has been obtained ("Effective
Date").  The Discretionary  Grant Program may commence  immediately,  but if the
Plan is submitted to stockholders for their approval and they decline to approve
the Plan or if the Plan is not  approved  by the  stockholders  within 12 months
after its  adoption  by the Board,  the Plan and all  Discretionary  Options and
Awards made under the Discretionary Grant Program shall automatically  terminate
to the same  extent  and with the same  effect as though the Plan had never been
adopted. If the Plan is approved by shareholders,  all Discretionary  Options or
Awards granted under the Discretionary Grant Program to Eligible Persons who are
Affiliates shall be deemed made on the Effective Date.

                  (b) Amendments to Plan.  The Board may,  without action on the
part of the Company's  stockholders,  make such  amendments  to,  changes in and
additions  to the  Plan  as it  may,  from  time  to  time,  deem  necessary  or
appropriate  and in the best interests of the Company;  provided,  the Board 
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may not,  without the consent of the  applicable  Optionholder,  take any action
which  disqualifies any Discretionary  Option previously  granted under the Plan
for treatment as an Incentive Stock Option or which adversely affects or impairs
the rights of the Optionholder of any Discretionary Option outstanding under the
Plan, and further  provided that,  except as provided in Article IV hereof,  the
Board may not, without the approval of the Company's stockholders,  (i) increase
the  aggregate  number of shares of Stock  subject to the Plan,  (ii) reduce the
exercise  price at which  Discretionary  Options may be granted or the  exercise
price at which any  outstanding  Discretionary  Option may be  exercised,  (iii)
extend  the term of the Plan,  (iv)  change  the class of  persons  eligible  to
receive  Discretionary  Options  or Awards  under the  Plan,  or (v)  materially
increase the benefits accruing to participants  under the Plan.  Notwithstanding
the foregoing, Discretionary Options or Awards may be granted under this Plan to
purchase  shares of Stock in excess of the number of shares then  available  for
issuance  under the Plan if (A) an amendment  to increase the maximum  number of
shares  issuable  under the Plan is  adopted by the Board  prior to the  initial
grant of any such Option or Award and within one year  thereafter such amendment
is approved by the Company's stockholders and (B) each such Discretionary Option
or Award granted is not to become exercisable or vested, in whole or in part, at
any time prior to the obtaining of such stockholder approval.

                                   ARTICLE II
                           Discretionary Grant Program

         2.1 Participants; Administration.

                  (a) Eligibility and Participation.  Discretionary  Options and
Awards may be granted only to persons  ("Eligible  Persons")  who at the time of
grant are (i) key personnel (including officers and directors) of the Company or
parent or  subsidiaries  of the  Company,  or (ii)  consultants  or  independent
contractors  who  provide  valuable   services  to  the  Company  or  parent  or
subsidiaries of the Company;  provided that (1) if a Senior  Committee is formed
pursuant to Section 2.1(b) hereof, the members of that Senior Committee shall be
ineligible,  during  their  tenure  on  the  Senior  Committee,  to  be  granted
Discretionary  Options  or Awards  under the Plan or to be  granted  or  awarded
equity  securities  of the Company  pursuant to any other plan of the Company or
its affiliates  except  pursuant to the Automatic  Grant Program or as otherwise
allowed by Rule 16b-3(c)(2)(i) promulgated under the 1934 Act, and (2) Incentive
Stock  Options  may only be granted to key  personnel  of the  Company  (and its
Parent or  Subsidiary)  who are also  employees  of the  Company  (or its Parent
Corporation or Subsidiary  Corporation).  A Plan  Administrator  shall have full
authority to determine which Eligible Persons in its  administered  group are to
receive  Discretionary  Option grants under the Plan, the number of shares to be
covered by each such grant,  whether or not the granted  Discretionary Option is
to be an  Incentive  Stock  Option,  the  time  or  times  at  which  each  such
Discretionary  Option is to become  exercisable,  and the maximum term for which
the Discretionary  Option is to be outstanding.  A Plan Administrator shall also
have full  authority to determine  which  Eligible  Persons in such group are to
receive Awards under the Discretionary Grant Program and the conditions relating
to such Award.

                  (b) General  Administration.  The Eligible  Persons  under the
Discretionary  Grant Program shall be divided into two groups and there shall be
a separate administrator for each group. One group will be comprised of Eligible
Persons that are  Affiliates.  For purposes of this Plan, the term  "Affiliates"
shall mean all  "executive  officers"  (as that term is defined in Rule 16a-1(f)
promulgated under the 1934 Act) and directors of the Company and all persons who
own  ten  percent  or  more  of the  Company's  issued  and  outstanding  Stock.
Initially,  the power to administer the Discretionary Grant Program with respect
to Eligible  Persons that are Affiliates  shall be vested with the Board. At any
time,  however,  the Board may vest the power to  administer  the  Discretionary
Grant  Program with respect to 
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Persons  that  are  Affiliates   exclusively   with  a  committee  (the  "Senior
Committee") comprised of two or more Disinterested Directors which are appointed
by the Board. The administration of all Eligible Persons that are not Affiliates
("Non-Affiliates")  shall be  vested  exclusively  with the  Board.  The  Board,
however,  may at any time appoint a committee (the "Employee  Committee") of two
or more  persons  who are  members of the Board and  delegate  to such  Employee
Committee the power to administer the  Discretionary  Grant Program with respect
to the  Non-Affiliates.  Members of the Senior Committee and Employee  Committee
shall  serve for such  period of time as the  Board may  determine  and shall be
subject to removal by the Board at any time. The Board may at any time terminate
all or a portion of the  functions of the Senior  Committee  and/or the Employee
Committee  and  reassume  all or a portion  of powers and  authority  previously
delegated to such Committee.

                  (c) Plan  Administrators.  The Board, the Employee  Committee,
and/or the Senior Committee,  whichever is applicable, shall be each referred to
herein  as a "Plan  Administrator."  Each  Plan  Administrator  shall  have  the
authority and  discretion,  with respect to its  administered  group,  to select
which Eligible Persons shall participate in the Discretionary  Grant Program, to
grant Discretionary  Options or Awards under the Discretionary Grant Program, to
establish such rules and regulations as they may deem  appropriate  with respect
to the proper administration of the Discretionary Grant Program and to make such
determinations under, and issue such interpretations of, the Discretionary Grant
Program  and any  outstanding  Discretionary  Option  or  Award as they may deem
necessary or advisable.  Unless otherwise  required by law,  decisions among the
members of a Plan Administrator  shall be by majority vote.  Decisions of a Plan
Administrator  shall be final and binding on all parties who have an interest in
the  Discretionary  Grant  Program or any  outstanding  Discretionary  Option or
Award.

                  (d) Guidelines for Participation. In designating and selecting
Eligible Persons for  participation in the Discretionary  Grant Program,  a Plan
Administrator  shall consult with and give consideration to the  recommendations
and criticisms submitted by appropriate managerial and executive officers of the
Company.  A Plan  Administrator  also  shall  take into  account  the duties and
responsibilities  of the Eligible  Persons,  their past,  present and  potential
contributions  to the success of the  Company  and such other  factors as a Plan
Administrator  shall deem relevant in connection with  accomplishing the purpose
of the Plan.

         2.2 Terms and Conditions of Options

                  (a) Allotment of Shares. A Plan Administrator  shall determine
the number of shares of Stock to be optioned from time to time and the number of
shares to be optioned to any Eligible Person (the "Optioned Shares").  The grant
of a Discretionary  Option to a person shall neither entitle such person to, nor
disqualify  such  person  from,  participation  in any other grant of Options or
Stock Awards under this Plan or any other stock option plan of the Company.

                  (b)  Exercise  Price.  Upon  the  grant  of any  Discretionary
Option,  a Plan  Administrator  shall specify the option price per share.  In no
event may the option price per share specified by a Plan  Administrator  be less
than 85 percent of the fair market  value per share of the Stock on the date the
Discretionary Option is granted;  provided,  however,  that if the Discretionary
Option is intended to qualify as an Incentive  Stock Option under the Code,  the
option price per share may not be less than 100 percent of the fair market value
per share of the stock on the date the  Discretionary  Option  is  granted  (110
percent if the Discretionary  Option is granted to a shareholder who at the time
the  Discretionary  Option is granted owns or is deemed to own stock  possessing
more than 10 percent of the total combined  voting power of all classes of stock
of the Company or of any Parent  Corporation  or  Subsidiary  Corporation).  The
determination  of the fair market value of the Stock shall be made in accordance
with the valuation provisions of Section 4.5 hereof.
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                  (c) Individual Stock Option Agreements.  Discretionary Options
granted under the Plan shall be evidenced by option  agreements in such form and
content as a Plan  Administrator  from time to time approves,  which  agreements
shall  substantially  comply  with and be  subject  to the  terms  of the  Plan,
including the terms and  conditions of this Section 2.2. As determined by a Plan
Administrator,  each option agreement shall state (i) the total number of shares
to which it  pertains,  (ii) the  exercise  price for the shares  covered by the
Option, (iii) the time at which the Options vest and become exercisable and (iv)
the Option's  scheduled  expiration date. The option agreements may contain such
other  provisions  or  conditions  as a Plan  Administrator  deems  necessary or
appropriate to effectuate the sense and purpose of the Plan, including covenants
by the  Optionholder not to compete and remedies for the Company in the event of
the breach of any such covenant.

                  (d) Option Period.  No Discretionary  Option granted under the
Plan that is intended to be an Incentive Stock Option shall be exercisable for a
period  in  excess of 10 years  from the date of its  grant  (five  years if the
Discretionary   Option  is  granted  to  a  shareholder  who  at  the  time  the
Discretionary  Option is granted owns or is deemed to own stock  possessing more
than 10 percent of the total  combined  voting  power of all classes of stock of
the Company or of its parent or any subsidiary corporation),  subject to earlier
termination in the event of  termination  of employment,  retirement or death of
the Optionholder.  A Discretionary Option may be exercised in full or in part at
any time or from time to time  during  the term of the  Discretionary  Option or
provide  for its  exercise in stated  installments  at stated  times  during the
Option's term.

                  (e)  Vesting;  Limitations.  The  time at which  the  Optioned
Shares vest with respect to an  Optionholder  shall be in the discretion of that
Optionholder's  Plan  Administrator;  provided,  however,  that no Affiliate may
exercise  a  Discretionary  Option  within  six  months  of the  date of  grant.
Notwithstanding the foregoing,  to the extent a Discretionary Option is intended
to qualify as an  Incentive  Stock  Option,  the  aggregate  fair  market  value
(determined as of the respective  date or dates of grant) of the Stock for which
one or more  Options  granted to any person under this Plan (or any other option
plan of the Company or its parent or subsidiary  corporations) may for the first
time become  exercisable as Incentive Stock Options during any one calendar year
shall not  exceed  the sum of  $100,000  (referred  to  herein as the  "$100,000
Limitation").  To the extent  that any person  holds two or more  Options  which
become  exercisable  for the first time in the same calendar year, the foregoing
limitation on the  exercisability  as an Incentive Stock Option shall be applied
on the basis of the order in which such Options are granted.

                  (f) No Fractional  Shares.  Options shall be exercisable  only
for whole  shares;  no  fractional  shares will be issuable upon exercise of any
Discretionary Option granted under the Plan.

                  (g) Method of Exercise.  In order to exercise a  Discretionary
Option with respect to any vested Optioned  Shares,  an Optionholder  (or in the
case of an exercise after an Optionholder's death, such Optionholder's executor,
administrator,  heir or  legatee,  as the case may be) must  take the  following
action:

                           (i)  execute  and  deliver  to the  Company a written
notice of exercise signed in writing by the person  exercising the Discretionary
Option  specifying  the  number  of shares of Stock  with  respect  to which the
Discretionary Option is being exercised;
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                           (ii)  pay the  aggregate  Option  Price in one of the
alternate forms as set forth in Section 2.2(h) below; and

                           (iii)  furnish  appropriate  documentation  that  the
person or  persons  exercising  the  Discretionary  Option  (if  other  than the
Optionholder) has the right to exercise such Option.

As soon after the Exercise Date as practical,  the Company shall mail or deliver
to or on behalf of the Optionholder  (or any other person or persons  exercising
this Discretionary  Option in accordance herewith) a certificate or certificates
representing the Stock for which the Discretionary  Option has been exercised in
accordance  with the provisions of this Plan. In no event may any  Discretionary
Option be exercised for any fractional shares.

                  (h) Payment Price. The aggregate Option Price shall be payable
in one of the alternative forms specified below:

                           (i) Full payment in cash or check made payable to the
Company's order; or

                           (ii) Full  payment  in  shares of Stock  held for the
requisite period necessary to avoid a charge to the Company's  reported earnings
and  valued  at fair  market  value  on the  Exercise  Date  (as  determined  in
accordance with Section 4.5 hereof); or

                           (iii)  If  a  cashless   exercise  program  has  been
implemented by the Board,  full payment through a sale and remittance  procedure
pursuant  to which  the  Optionholder  (A)  shall  provide  irrevocable  written
instructions to a designated  brokerage firm to effect the immediate sale of the
Optioned  Shares  to be  purchased  and  remit to the  Company,  out of the sale
proceeds  available  on the  settlement  date,  sufficient  funds to  cover  the
aggregate exercise price payable for the Optioned Shares to be purchased and (B)
shall  concurrently  provide  written  directives  to the Company to deliver the
certificates for the Optioned Shares to be purchased  directly to such brokerage
firm in order to complete the sale transaction.

                  (i) Rights of a  Stockholder.  An  Optionholder  shall have no
rights as a  stockholder  with  respect to shares  covered by his  Discretionary
Option until the date a stock  certificate is issued to him. No adjustment  will
be made for  dividends or other rights for which the record date is prior to the
date such stock certificate is issued.

                  (j) Repurchase Right. The Plan  Administrator may, in its sole
discretion,  set forth other terms and conditions upon which the Company (or its
assigns)  shall  have the right to  repurchase  shares of Stock  acquired  by an
Optionholder  pursuant to a Discretionary  Option.  Any repurchase  right of the
Company shall be exercisable  by the Company (or its assignees)  upon such terms
and  conditions as the Plan  Administrator  may specify in the Stock  Repurchase
Agreement  evidencing  such  right.  The  Plan  Administrator  may  also  in its
discretion  establish  as a term  and  condition  of one or  more  Discretionary
Options  granted  under the Plan that the  Company  shall  have a right of first
refusal  with  respect  to  any  proposed  sale  or  other  disposition  by  the
Optionholder   of  any  shares  of  Stock  issued  upon  the  exercise  of  such
Discretionary  Options.  Any such right of first refusal shall be exercisable by
the Company (or its assigns) in  accordance  with the terms and  conditions  set
forth in the Stock Repurchase Agreement.
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                  (k) Termination of Service.  If any Optionholder  ceases to be
in Service to the Company for a reason other than death,  such  Optionholder (or
such  Optionholder's  successors in the case of the  Optionholder's  death) may,
within 30 days after the date of  termination  of such Service,  but in no event
after the Discretionary Option's stated expiration date, exercise some or all of
the Discretionary  Options that the Optionholder was entitled to exercise on the
date  the  Optionholder's  Service  terminated;   provided,   that  (i)  if  the
Optionholder's  Service is terminated by the Company in its good faith judgment,
for (A) commission of a crime by the Optionholder or for reasons involving moral
turpitude;  (B) an act by the Optionholder which tends to bring the Company into
disrepute;   or  (C)  negligent,   fraudulent  or  willful   misconduct  by  the
Optionholder,  or (ii) if after the Service of the  Optionholder  is terminated,
the Optionholder commits acts detrimental to the Company's  interests,  then the
Discretionary Option shall thereafter be void for all purposes.  Notwithstanding
the  foregoing,  if any  Optionholder  ceases to be in Service to the Company by
reason of  permanent  disability  within the meaning of section  22(e)(3) of the
Code (as  determined by the applicable  Plan  Administrator),  the  Optionholder
shall have 180 days after the date of  termination  of Service,  but in no event
after the stated expiration date of the Optionholder's Discretionary Options, to
exercise Discretionary Options that the Optionholder was entitled to exercise on
the date the Optionholder's Service terminated as a result of disability.

                  (l)  Nonassignability.  No Discretionary  Option granted under
the  Plan  or any of the  rights  and  privileges  conferred  thereby  shall  be
assignable or transferable by an Optionholder  other than by will or the laws of
descent and  distribution,  and such  Discretionary  Option shall be exercisable
during the Optionholder's lifetime only by the Optionholder.

                  (m) Death of  Optionholder.  If an Optionholder  dies while in
the Company's Service, the Optionholder's  vested  Discretionary  Options on the
date of death  shall be  exercisable  within 90 days of such  death or until the
stated expiration date of the Optionholder's Option,  whichever occurs first, by
the person or persons  ("successors")  to whom the  Optionholder's  rights  pass
under a will or by the laws of descent and distribution.  A Discretionary Option
may be exercised and payment of the option price made in full by the  successors
only after written  notice to the Company  specifying the number of shares to be
purchased.  Such notice  shall state that the Option Price is being paid in full
in the manner specified in Section 2.2(g) hereof.  As soon as practicable  after
receipt  by the  Company  of such  notice  and of  payment in full of the Option
Price, a certificate or certificates  representing  the Optioned Shares shall be
registered  in the name or names  specified  by the  successors  in the  written
notice of exercise and shall be delivered to the successors.

                  (n) Other Plan Provisions Still Applicable. If a Discretionary
Option is exercised upon the  termination of Service or death of an Optionholder
under  this  Section  2.2,  the  other  provisions  of the Plan  shall  still be
applicable to such exercise,  including the requirement that the Optionholder or
its successor may be required to enter into a Stock Repurchase Agreement.

                  (o) Definition of "Service". For purposes of this Plan, unless
it is evidenced  otherwise in the option  agreement with the  Optionholder,  the
Optionholder  shall be deemed to be in  "Service" to the Company so long as such
individual renders continuous services on a periodic basis to the Company (or to
any Parent or Subsidiary Corporation) in the capacity of an employee,  director,
or  an  independent   consultant  or  advisor.  In  the  discretion  of  a  Plan
Administrator,  an Optionholder  shall be considered to be rendering  continuous
services to the Company even if the type of services change, e.g., from employee
to  independent  consultant.  The  Optionholder  shall  be  considered  to be an
employee for so long as such individual  remains in the employ of the Company or
one or more of its Parent or Subsidiary Corporations.
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         2.3 Terms and Conditions of Stock Awards

                  (a)  Eligibility.  All Eligible  Persons  shall be eligible to
receive Stock Awards.  The Plan  Administrator of each administered  group shall
determine  the number of shares of Stock to be awarded  from time to time to any
Eligible  Person in such  group.  The grant of a Stock  Award to a person  shall
neither  entitle such person to, nor disqualify  such person from  participation
in, any other grant of options or awards by the Company, whether under this Plan
or under any other stock option or award plan of the Company.

                  (b) Award for Services Rendered. Stock Awards shall be granted
in recognition of an Eligible Person's past services to the Company the value of
which services must exceed the value of any compensation  previously received by
such  Eligible  Person  for  such  past  services  as may be  determined  by the
applicable Plan Administrator.  The grantee of any such Stock Award shall not be
required  to pay any  consideration  to the Company  upon  receipt of such Stock
Award,  except as may be required  to satisfy  applicable  employment  taxes and
income tax withholding requirements.

                  (c) Conditions to Award.  All Stock Awards shall be subject to
such terms,  conditions,  restrictions,  or limitations  as the applicable  Plan
Administrator  deems appropriate,  including,  by way of illustration but not by
way of limitation,  restrictions on  transferability,  requirements of continued
employment,  individual performance or the financial performance of the Company,
or payment by the recipient of any applicable  employment or withholding  taxes.
Such  Plan  Administrator  may  modify  or  accelerate  the  termination  of the
restrictions  applicable to any Stock Award under the  circumstances as it deems
appropriate.  Notwithstanding the foregoing,  any Stock received by an affiliate
pursuant  to a Stock  Award  must be held for a period of six  months  after the
grant of such Stock Award.

                  (d) Award  Agreements.  A Plan  Administrator may require as a
condition to a Stock Award that the  recipient of such Stock Award enter into an
award agreement in such form and content as that Plan Administrator from time to
time approves.

         2.4 Terms and Conditions of SARs

                  (a)  Eligibility.  All Eligible  persons  shall be eligible to
receive SARs. The Plan  Administrator of each administered group shall determine
the SARs to be awarded from time to time to any  Eligible  Person in such group.
The grant of an SAR to a person  shall  neither  entitle  such  person  to,  nor
disqualify  such  person  from  participation  in, any other grant of options or
awards by the Company,  whether  under this Plan or under any other stock option
or award plan of the Company.

                  (b)  Award of SARs.  Concurrently  with or  subsequent  to the
grant of any  Discretionary  Option to purchase  one or more shares of Stock,  a
Plan  Administrator  may award to the Optionholder with respect to each share of
Stock, a related SAR permitting the  Optionholder to be paid the appreciation on
the Stock underlying the Discretionary  Option in lieu of exercising the Option.
In  addition,  a Plan  Administrator  may  award to any  Eligible  Person an SAR
permitting  the  Eligible  Person to be paid the  appreciation  on a  designated
number of shares of the Stock, whether or not such Shares are actually issued.

                  (c)  Conditions  to SAR.  All SARs  shall be  subject  to such
terms,   conditions,   restrictions   or  limitations  as  the  applicable  Plan
Administrator  deems appropriate,  including,  by way of illustration but not by
way of limitation,  restrictions of  transferability,  requirements of continued
                                      A-8

employment,  individual  performance,  financial  performance of the Company, or
payment by the recipient of any applicable employment or withholding taxes. Such
Plan  Administrator may modify or accelerate the termination of the restrictions
applicable to any SAR under the circumstances as it deems appropriate.

                  (d) SAR  Agreements.  A Plan  Administrator  may  require as a
condition  to the grant of an SAR that the  recipient  of such SAR enter into an
SAR agreement in such form and content as that Plan  Administrator  from time to
time approves.

                  (e)  Exercise.  An Eligible  Person who has been granted a SAR
may exercise such SAR subject to the  conditions  specified in the SAR agreement
by the Plan Administrator.

                  (f)  Amount of  Payment.  The  amount of  payment to which the
grantee of an SAR shall be entitled upon the exercise of each SAR shall be equal
to the amount, if any, by which the fair market value of the specified shares of
Stock on the exercise date exceeds the fair market value of the specified shares
of Stock on the date the Discretionary  Option related to the SAR was granted or
became  effective,  or, if the SAR is not related to any Option, on the date the
SAR was granted or became effective.

                  (g) Form of  Payment.  The SAR may be paid in  either  cash or
Stock, as determined in the discretion of the applicable Plan  Administrator and
set forth in the SAR agreement. If the payment is in Stock, the number of shares
to be paid to the participant  shall be determined by dividing the amount of the
payment  determined  pursuant to Section  2.4(f) by the fair  market  value of a
share of Stock on the  exercise  date of such SAR.  As soon as  practical  after
exercise,  the  Company  shall  deliver  to the SAR  grantee  a  certificate  or
certificates for such shares of Stock.

                  (h) Termination of Employment; Death. Sections 2.2(k) and (m),
applicable to Options, shall apply equally to SARs.

                  (i) Nonassignability.  No SAR granted under the Plan or any of
the rights and privileges  conferred thereby shall be assignable or transferable
by a grantee  other than by will or the laws of descent  and  distribution,  and
such SAR shall be exercisable during the grantee's lifetime only by the grantee.

         2.5 Other Cash Awards

                  (a) In General.  The Plan  Administrator of each  administered
group shall have the discretion to make other awards of cash to Eligible Persons
in such group ("Cash  Awards").  Such Cash Awards may relate to existing Options
or to the appreciation in the value of the Stock or other Company securities.

                  (b)  Conditions to Award.  All Cash Awards shall be subject to
such terms,  conditions,  restrictions  or limitations  as the  applicable  Plan
Administrator  deems  appropriate,  and such Plan Administrator may require as a
condition to such Cash Award that the recipient of such Cash Award enter into an
award agreement in such form and content as the Plan  Administrator from time to
time approves.
                                       A-9

                                   ARTICLE III
                             Automatic Grant Program

         3.1 Eligible  Persons under the Automatic  Grant  Program.  The persons
eligible to  participate  in the  Automatic  Grant  Program  shall be limited to
non-employee Board members ("Eligible Persons").  Persons who are eligible under
the  Automatic  Grant  Program  may also be  eligible  to receive  Discretionary
Options or Awards  under the  Discretionary  Grant  Program or option  grants or
direct stock issuances under other plans of the Company.

         3.2 Terms and Conditions of Automatic Option Grants.

                  (a)  Amount  and Date of Grant.  During the term of this Plan,
Automatic  Grants  shall be made to each  Eligible  Person  ("Optionholder")  as
follows:

                           (i) Annual Grants. Each year on the Annual Grant Date
an  Automatic  Option to acquire  2,000 shares of Stock shall be granted to each
Eligible Person for so long as there are shares of Stock available under Section
1.2 hereof.  The "Annual Grant Date" shall be the date of the  Company's  annual
stockholders  meeting  commencing as of the next annual meeting  occurring after
the annual  meeting held on the Effective  Date.  Any Person that was granted an
Automatic  Option under  Section  3.2(a)(ii)  hereof within 30 days of an Annual
Grant Date shall be ineligible to receive an Automatic  Option grant pursuant to
this Section 3.2(a)(i) on such Annual Grant Date.

                           (ii)  Initial  New  Director  Grants.  On the Initial
Grant Date,  every new member of the Board who is an Eligible Person and has not
previously  received an Automatic  Option  grant under this  Section  3.2(a)(ii)
shall  be  granted  an  Automatic  Option  to  acquire  20,000  shares  of Stock
("Optioned Shares") as long as there are shares of Stock available under Section
1.2 hereof.  The "Initial Grant Date" shall be the date that an Eligible  Person
is first appointed or elected to the Board. Any Eligible Person that was granted
an Automatic Option on the Effective Date pursuant to Section  3.2(a)(iii) shall
be  ineligible  to receive an Automatic  Option  grant  pursuant to this Section
3.2(a)(ii).

                           (iii)  Initial  Existing   Director  Grants.  On  the
Effective  Date,  each Eligible  Person shall be granted an Automatic  Option to
acquire 2,000 shares of Stock.

                  (b)  Exercise  Price.  The  exercise  price per share of Stock
subject to each Automatic Option Grant shall be equal to 100 percent of the fair
market value per share of the Stock on the date the Automatic Option was granted
as determined in accordance with the valuation  provisions of Section 4.5 hereof
(the "Option Price").

                  (c)  Vesting.   Each  Automatic   Option  Grant  shall  become
exercisable  and  vest  in  a  series  of  three  equal  and  successive  yearly
installments,  with each annual  installment  to become  exercisable  on the day
before the Company's annual  stockholders'  meeting  occurring in the applicable
year.  Each  installment  of an  Automatic  Option  shall  only vest and  become
exercisable if the  Optionholder  has not ceased serving as a Board member as of
such installment date.

                  (d) Method of  Exercise.  In order to  exercise  an  Automatic
Option with respect to any vested Optioned  Shares,  an Optionholder  (or in the
case of an exercise after an Optionholder's death, such Optionholder's executor,
administrator,  heir or  legatee,  as the case may be) must  take the  following
action:
                                       A-10

                           (i)  execute  and  deliver  to the  Company a written
notice of  exercise  signed in writing by the person  exercising  the  Automatic
Option  specifying  the  number  of shares of Stock  with  respect  to which the
Automatic Option is being exercised;

                           (ii)  pay the  aggregate  Option  Price in one of the
alternate forms as set forth in Section 3.2(e) below; and

                           (iii)  furnish  appropriate  documentation  that  the
person  or  persons   exercising  the  Automatic   Option  (if  other  than  the
Optionholder) has the right to exercise such Option.

As soon after the Exercise Date, as practical, the Company shall mail or deliver
to or on behalf of the Optionholder  (or any other person or persons  exercising
this  Automatic  Option in accordance  herewith) a certificate  or  certificates
representing  the Stock for which the  Automatic  Option has been  exercised  in
accordance  with the  provisions  of this  Plan.  In no event may any  Automatic
Option be exercised for any fractional shares.

                  (e) Payment Price. The aggregate Option Price shall be payable
in one of the alternative forms specified below:

                           (i) full payment in cash or check made payable to the
Company's order; or

                           (ii) full  payment  in  shares of Stock  held for the
requisite period necessary to avoid a charge to the Company's  reported earnings
and  valued  at fair  market  value  on the  Exercise  Date  (as  determined  in
accordance with Section 4.5 hereof); or

                           (iii)  if  a  cashless   exercise  program  has  been
implemented by the Board,  full payment through a sale and remittance  procedure
pursuant  to which  the  Optionholder  (A)  shall  provide  irrevocable  written
instructions to a designated  brokerage firm to effect the immediate sale of the
Optioned  Shares  to be  purchased  and  remit to the  Company,  out of the sale
proceeds  available  on the  settlement  date,  sufficient  funds to  cover  the
aggregate exercise price payable for the Optioned Shares to be purchased and (B)
shall  concurrently  provide  written  directives  to the Company to deliver the
certificates for the Optioned Shares to be purchased  directly to such brokerage
firm in order to complete the sale transaction.

                  (f) Term of Option.  Each Automatic Option shall expire on the
tenth  anniversary  of the date on  which an  Automatic  Option  Grant  was made
("Expiration  Date").  Except as  provided  in  Section  4.4  hereof,  should an
Optionholder's  service as a Board member cease prior to the Expiration Date for
any reason while an Automatic Option remains  outstanding and unexercised,  then
the Automatic Option term shall  immediately  terminate and the Automatic Option
shall cease to be outstanding in accordance with the following provisions:

                           (i) The Automatic Option shall immediately  terminate
and cease to be outstanding for any shares of Stock which were not vested at the
time of Optionholder's cessation of Board service.

                           (ii)  Should an  Optionholder  cease,  for any reason
other than death, to serve as a member of the Board, then the Optionholder shall
have 30 days measured from the date of such  cessation of Board service in which
to exercise  the Options  which  vested  prior to the time of such  cessation of
Board service. In no event, however, may any Automatic Option be exercised after
the Expiration Date of such Option.
                                      A-11

                           (iii) Should an  Optionholder  die while serving as a
Board  member or within  30 days  after  cessation  of Board  service,  then the
personal  representative of the Optionholder's  estate (or the person or persons
to whom the Automatic Option is transferred  pursuant to the Optionholder's will
or in accordance with the laws of descent and distribution)  shall have a 90 day
period measured from the date of the  Optionholder's  cessation of Board service
in  which  to  exercise  the  Options  which  vested  prior  to the time of such
cessation of Board service.  In no event,  however,  may any Automatic Option be
exercised after the Expiration Date of such Option.

                  (g) Rights of a  Stockholder.  An  Optionholder  shall have no
rights as a stockholder  with respect to shares covered by his Automatic  Option
until the date a stock  certificate is issued to him. No adjustment will be made
for  dividends  or other  rights for which the record  date is prior to the date
such stock certificate is issued.

                  (h) Limited  Transferability.  Each Automatic  Option shall be
exercisable  only by Optionholder  during  Optionholder's  lifetime and shall be
neither  transferable  nor  assignable,  other  than by  will or by the  laws of
descent and distribution following Optionholder's death.

                                   ARTICLE IV
                                  Miscellaneous

         4.1  Capital  Adjustments.  The  aggregate  number  of  shares of Stock
subject to the Plan (and the number of shares covered by outstanding Options and
Awards  and the price per share  stated in such  Options  and  Awards)  shall be
proportionately  adjusted  for  any  increase  or  decrease  in  the  number  of
outstanding  shares of Stock of the  Company  resulting  from a  subdivision  or
consolidation  of shares or any other  capital  adjustment  or the  payment of a
stock  dividend  or any other  increase or decrease in the number of such shares
effected  without  the  Company's  receipt of  consideration  therefor in money,
services or property.

         4.2 Mergers,  Etc. If the Company is the surviving  corporation  in any
merger or  consolidation,  any  Option  or Award  granted  under the Plan  shall
pertain to and apply to the securities to which a holder of the number of shares
of Stock  subject to the Option or Award would have been  entitled  prior to the
merger or consolidation. A dissolution or liquidation of the Company shall cause
every Option or Award outstanding hereunder to terminate.

         4.3 Corporate  Transaction.  In the event of stockholder  approval of a
Corporate  Transaction,  (a) all unvested Automatic Options shall  automatically
accelerate and immediately vest so that each outstanding  Option shall, one week
prior to the  specified  effective  date for the Corporate  Transaction,  become
fully exercisable for all of the Optioned Shares and (b) the Plan  Administrator
shall have the discretion and authority, exercisable at any time, to provide for
the  automatic  acceleration  of one or  more of the  outstanding  Discretionary
Options or Awards  granted by it under the Plan.  Upon the  consummation  of the
Corporate  Transaction,   all  Options  shall,  to  the  extent  not  previously
exercised, terminate and cease to be outstanding.
                                       A-12

         4.4 Change in Control.

                  (a)  Automatic  Grant  Program.  In the  event of a Change  in
Control,  all unvested  Automatic  Options shall  automatically  accelerate  and
immediately  vest so that each outstanding  Automatic Option shall,  immediately
prior to the effective date of such Change in Control,  become fully exercisable
for all of the Optioned Shares.  Thereafter,  each Automatic Option shall remain
exercisable until the Expiration Date of such Option.

                  (b) Discretionary  Grant Program.  In the event of a Change in
Control,  a  Plan  Administrator   shall  have  the  discretion  and  authority,
exercisable  at any time,  whether  before or after the  Change in  Control,  to
provide for the automatic acceleration of one or more outstanding  Discretionary
Options  or Awards  granted  by it under the Plan  upon the  occurrence  of such
Change in Control.  A Plan  Administrator  may also impose  limitations upon the
automatic  acceleration  of such  Options  or  Awards  to the  extent  it  deems
appropriate.  Any Options or Awards  accelerated  upon a Change in Control  will
remain fully  exercisable  until the  expiration  or sooner  termination  of the
Option term.

                  (c) Incentive Stock Option Limits.  The  exercisability of any
Discretionary  Options which are intended to qualify as Incentive  Stock Options
and which are accelerated by the Plan Administrator in connection with a pending
Corporation Transaction or Change in Control shall, except as otherwise provided
in the discretion of the Plan Administrator and the Optionholder, remain subject
to the $100,000 Limitation and vest as quickly as possible without violating the
$100,000 Limitation.

         4.5 Calculation of Fair Market Value of Stock. The fair market value of
a share of Stock on any relevant date shall be determined in accordance with the
following provisions:

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

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

                           (iii) If the Stock at the time is neither  listed nor
admitted  to trading on any stock  exchange  nor traded in the  over-the-counter
market, then the fair market value shall be determined by the Board after taking
into account such factors as the Board shall deem appropriate,  including one or
more independent professional appraisals.

         4.6 Use of Proceeds. The proceeds received by the Company from the sale
of Stock pursuant to the exercise of Options or Awards hereunder,  if any, shall
be used for general corporate purposes.
                                       A-13

         4.7  Cancellation of Options.  Each Plan  Administrator  shall have the
authority to effect,  at any time and from time to time, with the consent of the
affected Optionholders, the cancellation of any or all outstanding Discretionary
Options  granted  under  the  Plan by that  Plan  Administrator  and to grant in
substitution  therefore  new  Discretionary  Options under the Plan covering the
same or different  numbers of shares of Stock as long as such new  Discretionary
Options  have an  exercise  price per  share of Stock no less  than the  minimum
exercise price as set forth in Section 2.2(b) hereof on the new grant date.

         4.8 Regulatory Approvals.  The implementation of the Plan, the granting
of any Option or Award hereunder, and the issuance of Stock upon the exercise of
any such Option or Award shall be subject to the  procurement  by the Company of
all approvals and permits required by regulatory authorities having jurisdiction
over the Plan,  the  Options  or Awards  granted  under it and the Stock  issued
pursuant to it.

         4.9   Indemnification.   In   addition   to  such   other   rights   of
indemnification as they may have, the members of a Plan  Administrator  shall be
indemnified  and held  harmless by the Company,  to the extent  permitted  under
applicable law, for, from and against all costs and expenses reasonably incurred
by them in  connection  with any action,  legal  proceeding  to which any member
thereof may be a party by reason of any action taken, failure to act under or in
connection  with the Plan or any  rights  granted  thereunder  and  against  all
amounts paid by them in settlement  thereof or paid by them in satisfaction of a
judgment of any such action, suit or proceeding,  except a judgment based upon a
finding of bad faith.

         4.10 Plan Not Exclusive.  This Plan is not intended to be the exclusive
means by which the Company  may issue  options or warrants to acquire its Stock,
stock awards or any other type of award.  To the extent  permitted by applicable
law,  any such other  option,  warrants  or awards may be issued by the  Company
other than pursuant to this Plan without shareholder approval.

         4.11 Company  Rights.  The grants of Options shall in no way affect the
right of the Company to adjust,  reclassify,  reorganize or otherwise change its
capital or business structure or to merge, consolidate,  dissolve,  liquidate or
sell or transfer all or any part of its business or assets.

         4.12 Privilege of Stock Ownership.  An Optionholder  shall not have any
of the rights of a  stockholder  with  respect  to  Optioned  Shares  until such
individual  shall have  exercised  the Option and paid the Option  Price for the
Optioned Shares.

         4.13  Assignment.  The right to acquire Stock or other assets under the
Plan  may  not  be  assigned,   encumbered  or  otherwise   transferred  by  any
Optionholder except as specifically  provided herein. The provisions of the Plan
shall  inure to the  benefit  of,  and be  binding  upon,  the  Company  and its
successors or assigns, and the Optionholders, the legal representatives of their
respective  estates,  their  respective  heirs or legatees  and their  permitted
assignees.

         4.14 Securities Restrictions

                  (a)  Legend on  Certificates.  All  certificates  representing
shares of Stock issued upon exercise of Options or Awards granted under the Plan
shall be endorsed with a legend reading as follows:

               The  shares  of  Common  Stock  evidenced  by this
               certificate  have been  issued  to the  registered
               owner in  reliance  upon  written  representations
               that these shares have been  purchased  solely for
                                      A-14

               investment.   These   shares   may  not  be  sold,
               transferred  or assigned  unless in the opinion of
               the  Company  and its  legal  counsel  such  sale,
               transfer or assignment will not be in violation of
               the  Securities  Act of 1933, as amended,  and the
               rules and regulations thereunder.

                  (b) Private  Offering  for  Investment  Only.  The Options and
Awards are and shall be made  available  only to a limited number of present and
future key  executives  and key  employees  who have  knowledge of the Company's
financial  condition,  management  and its affairs.  The Plan is not intended to
provide additional capital for the Company,  but to encourage ownership of Stock
among the Company's key  personnel.  By the act of accepting an Option or Award,
each grantee  agrees (i) that,  any shares of Stock  acquired will be solely for
investment  not with any  intention to resell or  redistribute  those shares and
(ii) such intention will be confirmed by an appropriate  certificate at the time
the Stock is  acquired.  The neglect or failure to execute  such a  certificate,
however, shall not limit or negate the foregoing agreement.

                  (c)  Registration   Statement.  If  a  Registration  Statement
covering the shares of Stock issuable upon exercise of options granted under the
Plan as filed under the  Securities  Exchange  Act of 1933,  as amended,  and as
declared  effective by the  Securities  Exchange  Commission,  the provisions of
Sections  4.1(a)  and (b) shall  terminate  during  the period of time that such
Registration Statement, as periodically amended, remains effective.

         4.15 Tax Withholding.

                  (a) General.  The  Company's  obligation to deliver Stock upon
the exercise of Options under the Plan shall be subject to the  satisfaction  of
all applicable federal, state and local income tax withholding requirements.

                  (b)  Shares  to Pay for  Withholding.  The Board  may,  in its
discretion  and in accordance  with the  provisions of this Section  4.15(b) and
such  supplemental  rules  as it may  from  time to time  adopt  (including  the
applicable  safe-harbor  provisions  of  SEC  Rule  16b-3),  provide  any or all
Optionholders  with the right to use shares of Stock in  satisfaction  of all or
part of the  federal,  state and local income tax  liabilities  incurred by such
Optionholders in connection with the exercise of their Options  ("Taxes").  Such
right  may be  provided  to any  such  Optionholder  in  either  or  both of the
following formats:

                           (i) Stock Withholding.  The Optionholder of an Option
may be provided with the election to have the Company  withhold,  from the Stock
otherwise  issuable upon the exercise of such Option,  a portion of those shares
of Stock with an  aggregate  fair market  value equal to the  percentage  of the
applicable Taxes (not to exceed 100 percent) designated by the Optionholder.

                           (ii)  Stock   Delivery.   The  Board   may,   in  its
discretion,  provide  the  Optionholder  with the  election  to  deliver  to the
Company,  at the time the  Option  is  exercised,  one or more  shares  of Stock
previously  acquired by such individual  (other than pursuant to the transaction
triggering  the  Taxes)  with  an  aggregate  fair  market  value  equal  to the
percentage of the taxes incurred in connection with such Option exercise (not to
exceed 100 percent) designated by the Optionholder.
                                      A-15

                                    ARTICLE V
                                   Definitions

         The  following  capitalized  terms  used in this  Plan  shall  have the
meaning described below:

         "Affiliates"  shall  mean all  "executive  officers"  (as that  term is
defined in Rule  16a-1(f)  promulgated  under the 1934 Act) and directors of the
Company and all persons who own ten percent or more of the Company's  issued and
outstanding Stock.

         "Annual  Grant  Date"  shall  mean  the  date of the  Company's  annual
stockholder meeting commencing as of the next annual meeting occurring after the
annual meeting held on the Effective Date.

         "Automatic  Grant Program" shall mean that program set forth in Article
III of this Agreement  pursuant to which  non-employee  members of the Board are
automatically granted Options upon certain events.

         "Automatic  Option Grant" shall mean those automatic option grants made
on the Annual Grant Date, on the Initial Grant Date, and on the Effective Date.

         Automatic  Options"  shall mean those Options  granted  pursuant to the
Automatic Grant Program.

         "Award" shall mean a Stock Award, SAR or Cash Award.

         "Board" shall mean the Board of Directors of the Company.

         "Cash Award"  shall mean an award to be paid in cash and granted  under
Section 2.5 hereunder.

         "Change  in  Control"  shall  mean (i) a  person  or  related  group of
persons,  other  than  the  Company  or a person  that  directly  or  indirectly
controls,  is controlled by, or under common control with the Company,  acquires
ownership  of 40  percent  or more of the  Company's  outstanding  common  stock
pursuant to a tender or exchange  offer which the Board of Directors  recommends
that  the  Company's  stockholders  not  accept,  or  (ii)  the  change  in  the
composition of the Board occurs such that those  individuals who were elected to
the Board at the last  stockholders'  meeting at which there was not a contested
election for Board membership  subsequently ceased to comprise a majority of the
Board by reason of a contested election.

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

         "Company" shall mean Cerprobe Corporation, a Delaware corporation.

         "Corporate  Transaction"  shall mean (a) a merger or  consolidation  in
which the Company is not the  surviving  entity,  except for a  transaction  the
principal  purposes  of which is to change  the state in which  the  Company  is
incorporated;  (b)  the  sale,  transfer  of or  other  disposition  of  all  or
substantially  all of the assets of the  Company  and  complete  liquidation  or
dissolution  of the Company,  or (c) any reverse  merger in which the Company is
the surviving entity but in which the securities possessing more than 50 percent
of the total combined voting power of the Company's  outstanding  securities are
transferred to a person or persons different from those who held such securities
immediately prior to such merger.
                                      A-16

         "Discretionary  Grant  Program"  shall mean the  program  described  in
Article II of this  Agreement  pursuant to which  certain  Eligible  Persons are
granted Options or Awards in the discretion of the Plan Administrator.

         "Discretionary   Options"   shall  mean  options   granted   under  the
Discretionary Grant Program.

         "Disinterested  Directors"  shall mean those  Directors who satisfy the
definition of "Disinterested Person" under Rule 16b-3(c)(2)(i) promulgated under
the 1934 Act.

         "Effective Date" shall mean the date that the Plan has been approved by
the stockholders as required by Section 1.3(c) hereof.

         "Eligible  Persons"  shall mean (a) with  respect to the  Discretionary
Grant Program,  those persons who, at the time that the Discretionary  Option or
Award is granted,  are (i) key personnel  (including  officers and directors) of
the  Company  or Parent  or  Subsidiary  Corporations,  or (ii)  consultants  or
independent  contractors who provide valuable  services to the Company or Parent
or  Subsidiary  Corporations;  provided  that if a Senior  Committee  is  formed
pursuant to Section  1.3(a) hereof,  the members of that Committee  shall not be
included as "Eligible  Persons"  under the  Discretionary  Grant Program  during
their  tenure on the Senior  Committee;  and (b) with  respect to the  Automatic
Grant Program, those persons who are non-employee Board members.

         "Employee  Committee" shall mean that committee  appointed by the Board
to administer the Plan with respect to the  Non-Affiliates  and comprised of one
or more persons who are members of the Board.

         "Exercise  Date"  shall  be the  date on which  written  notice  of the
exercise  of an  Option is  delivered  to the  Company  in  accordance  with the
requirements of the Plan.

         "Expiration Date" shall be the 10-year anniversary of the date on which
an Automatic Option Grant was made.

         "Incentive  Stock  Option"  shall mean a  Discretionary  Option that is
intended to qualify as an "inventive stock option" under Code ss. 422.

         "Initial  Grant Date"  shall mean the date that an  Eligible  Person is
first appointed or elected to the Board.

         "Non-Affiliates" shall mean all persons who are not Affiliates.

         "$100,000  Limitation" shall mean the limitation in which the aggregate
fair market value  (determined as of the  respective  date or dates of grant) of
the Stock for which one or more  Discretionary  Options  granted  to any  person
under  this Plan (or any  other  option  plan of the  Company  or its  parent or
subsidiary  corporations)  may for the first time be  exercisable  as  Incentive
Stock Options during any one calendar year shall not exceed the sum of $100,000.

         "Optionholder"  shall mean an Eligible Person to whom Options have been
granted.

         "Optioned  Shares"  shall be those shares of Stock to be optioned  from
time to time to any Eligible Person.
                                      A-17

         "Option  Price"  shall mean 100  percent of the fair  market  value per
share of the  Stock on the  date  any  Option  was  granted,  as  determined  in
accordance with the valuation provisions of Section 4.5 hereof.

         "Options" shall mean options granted under the Plan to acquire Stock.

         "Parent  Corporation"  shall mean any corporation in the unbroken chain
of corporations ending with the employer corporation, where, at each link of the
chain,  the  corporation  and the link  above  owns at least 50  percent  of the
combined  total voting power of all classes of the stock in the  corporation  in
the link below.

         "Plan" shall mean this stock option plan for Cerprobe Corporation.

         "Plan  Administrator"  shall  mean (a)  either  the Board or the Senior
Committee,  whichever is applicable,  with respect to the  administration of the
Discretionary Grant Program as it relates to Affiliates and (b) either the Board
or  the  Employee  Committee,  whichever  is  applicable,  with  respect  to the
administration   of  the   Discretionary   Grant   Program   as  it  relates  to
Non-Affiliates.

         "SAR" shall mean stock appreciation  rights granted pursuant to Section
2.4 hereunder.

         "Senior Committee" shall mean that committee  appointed by the Board to
administer  the  Discretionary  Grant Program with respect to the Affiliates and
comprised of two or more Disinterested Directors.

         "Service" shall have the meaning set forth in Section 2.2(o) hereof.

         "Stock" shall mean shares of the Company's common stock, $.05 par value
per share,  which may be unissued or treasury shares, as the Board may from time
to time determine.

         "Stock   Awards"   shall  mean  Stock   directly   granted   under  the
Discretionary Grant Program.

         "Subsidiary  Corporation"  shall mean any  corporation  in the unbroken
chain of  corporations  starting with the employer  corporation,  where, at each
link of the chain,  the  corporation and the link above owns at least 50 percent
of the combined voting power of all classes of stock in the corporation below.

         EXECUTED as of the 8th day of May, 1995.

                                  CERPROBE CORPORATION

                                  By: /s/ C. Zane Close
                                      ------------------
                                  Name: C. Zane Close
                                        ----------------
                                  Its: President and CEO
                                       -----------------
ATTESTED BY:

______________________________
Secretary

                                      A-18 

Basic Info X:

Name: 1995 STOCK OPTION PLAN
Type: Stock Option Plan
Date: April 1, 1996
Company: CERPROBE CORP
State: Delaware

Other info:

Date:

  • May 9 , 1995
  • 8th day of May , 1995

Organization:

  • Company 's Board of Directors
  • Maximum Number of Shares Subject
  • Description of Stock and Maximum Shares Allocated
  • b Calculation of Available Shares
  • Company 's Common Stock
  • Senior Committee and Employee Committee
  • Parent Corporation or Subsidiary Corporation
  • Individual Stock Option Agreements
  • g Method of Exercise
  • k Termination of Service
  • Optionholder 's Service
  • m Death of Optionholder
  • Company 's Service
  • Conditions of Stock Awards
  • b Award for Services Rendered
  • III Automatic Grant Program 3.1 Eligible Persons
  • Conditions of Automatic Option Grants
  • Date of Grant
  • Annual Grant Date an Automatic Option
  • b Exercise Price
  • Incentive Stock Option Limits
  • Incentive Stock Options
  • Calculation of Fair Market Value of Stock
  • National Association of Securities Dealers
  • Privilege of Stock Ownership
  • Securities Exchange Commission
  • Initial Grant Date
  • Board of Directors of the Company
  • Discretionary Grant Program
  • C. Zane Close

Location:

  • Etc
  • Delaware

Money:

  • $ 100,000
  • $ .05

Person:

  • Optionholders

Percent:

  • 85 percent
  • 10 percent
  • 100 percent
  • ten percent
  • 40 percent
  • 50 percent