SGI INTERNATIONAL

                           1996 OMNIBUS STOCK PLAN


1.  Purpose of the Plan.  The purpose of the SGI International 1996 Omnibus
Stock Plan is to enable SGI International to provide an incentive to eligible
employees, consultants, advisors, Directors, and Officers whose present
and potential contributions are important to the continued success of the
Company, to afford these individuals the opportunity to acquire a proprietary
interest in the Company, and to enable the Company to enlist and retain in its
employment the best available talent for the successful conduct of its business.
It is intended that this purpose will be effected through the granting of (a)
incentive and nonqualified stock options, (b) stock purchase rights, (c) stock
appreciation rights, and (d) long-term performance awards.

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

(a)  "Applicable Laws" means the legal requirements relating to the
administration of stock option plans under applicable securities laws, Utah
corporate law, and the Internal Revenue Code.

(b)  "Board" means the Board of Directors of the Company.  If one or more
Committees have been appointed by the Board to administer the Plan,
"Board" also means such Committees.

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

(d)  "Committee" means a Committee appointed by the Board in accordance with
Section 5 of the Plan.

(e)  "Common Stock" means the Common Stock of the Company.

(f)  "Company" means SGI International, a Utah corporation.

(g)  "Consultant" means any person, including an advisor, engaged by the
Company or a Parent or Subsidiary to render services and who is
compensated for such services, provided that the term "Consultant" shall not
include Directors who are paid only a director's fee by the Company or who are
not compensated by the Company for their services as Directors.

(h)  "Continuous Status as an Employee or Consultant" means that the employment
or consulting relationship is not interrupted or terminated by the Company, any
Parent or Subsidiary.  Continuous Status as an Employee or Consultant shall not
be considered interrupted in the case of: (i) any leave of absence approved by
the Company, including sick leave, military leave, or any other personal leave;
provided, however, that for purposes of Incentive Stock Options, any such leave
may not exceed ninety (90) days, unless reemployment upon the expiration of
such leave is guaranteed by contract (including certain Company policies) or
statute; or (ii) transfers between locations of the Company or between the
Company, its Parent, its Subsidiaries or its successor.

(i)  "Director" means a member of the Board.

(j)  "Disability" means total and permanent disability as defined in Section
22(e)(3) of the Code.

(k)  "Employee" means any person, including Officers and Directors, employed by
the Company or any Parent or Subsidiary of the Company.  Neither service as a
Director nor payment of a director's fee by the Company shall be sufficient to
constitute "employment" by the Company.

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

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

(i)  If the Common Stock is listed on any established stock exchange or a
national market system, including without limitation the National Market System
of the National Association of Securities Dealers, Inc., Automated Quotation
("NASDAQ") System, the Fair Market Value of a Share of common stock shall be
the closing bid price for such stock as quoted on such system or exchange (or
the exchange with the greatest volume of trading in Common Stock) on the last
market trading day prior to the day of determination, as reported in The Wall
Street Journal or such other source as the Board deems reliable;

(ii)  If the Common Stock is quoted on the NASDAQ System (but not on the
National Market System thereof) or is regularly quoted by a recognized
securities dealer but selling prices are not reported, the Fair Market Value
of a Share of Common Stock shall be the mean between the high bid and low asked
prices for the Common Stock on the last market trading day prior to the day of
determination, as reported in the Wall Street Journal or such other source as
the Board deems reliable;

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

(n)  "Incentive Stock Option" means an Option intended to qualify as an
incentive stock option within the meaning of Section 422 of the Code and the
regulations promulgated thereunder.

(o)  "Long-Term Performance Award" means an award under Section 10 below.  A
Long-Term Performance Award shall permit the recipient to receive a cash or
stock bonus (as determined by the Board) upon satisfaction of such performance
factors as are set out in the recipient's individual grant.  Long-term
Performance Awards will be based upon the achievement of Company, Subsidiary
and/or individual performance factors or upon such other criteria as the Board
may deem appropriate.

(p)  "Long-Term Performance Award Agreement" means a written agreement between
the Company and an Optionee evidencing the terms and conditions of an
individual Long-Term Performance Award grant.  The Long-Term Performance Award
Agreement is subject to the terms and conditions of the Plan.

(q)  "Nonqualified Stock Option" means any Option that is not an Incentive
Stock Option.

(r)  "Notice of Grant" means a written notice evidencing certain terms and
conditions of an individual Option, Stock Purchase Right, or Long-Term
Performance Award grant.  The Notice of Grant is part of the Option Agreement,
and the Long-Term Performance Award Agreement.

(s)  "Officer" means a person who is an Officer of the Company within the
meaning of Section 16 of the Exchange Act and the rules and regulations
promulgated thereunder.

(t)  "Option" means a stock option granted pursuant to the Plan.

(u)  "Option Agreement" means a written agreement between the Company and an
Optionee evidencing the terms and conditions of an individual Option grant.
The Option Agreement is subject to the terms and conditions of the Plan.

(v)  "Option Exchange Program" means a program whereby outstanding options are
surrendered in exchange for options with a lower exercise price.

(w)  "Optioned Stock" means the Common Stock underlying an Option or Right.

(x)  "Optionee" means an Employee or Consultant who holds an outstanding Option
or Right.

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

(z)  "Plan" means this 1996 Omnibus Stock Plan.

(aa)  "Restricted Stock" means shares of Common Stock subject to a Restricted
Stock Purchase Agreement acquired pursuant to a grant of Stock Purchase Rights
under Section 9 below.

(bb)  "Restricted Stock Purchase Agreement" means a written agreement between
the Company and the Optionee evidencing the terms and restrictions applying to
stock purchased under a Stock Purchase Right.  The Restricted Stock Purchase
Agreement is subject to the terms and conditions of the Plan and the Notice of
Grant.

(cc)  "Right" means and includes Long-Term Performance Awards, Stock
Appreciation Rights, and Stock Purchase Rights granted pursuant to the Plan.

(dd)  "Rule 16b-3" means Rule 16b-3 of the Exchange Act or any successor rule
thereto, as in effect when discretion is being exercised with respect to the
Plan.

(ee)  "SAR" means a stock appreciation right granted pursuant to Section 8 of
the Plan.

(ff)  "SAR Agreement" means a written agreement between the Company and an
Optionee evidencing the terms and conditions of an individual SAR grant.  The
SAR Agreement is subject to the terms and conditions of the Plan.

(gg)  "Share" means a share of the Common Stock, as adjusted in accordance with
Section 12 of the Plan.

(hh)  "Stock Purchase Right" means the right to purchase Common Stock pursuant
to Section 9 of the Plan, as evidenced by a Notice of Grant.

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

3.  Eligibility.  Nonqualified Stock Options and Rights may be granted to
Employees and Consultants. Incentive Stock Options may be granted only to
Employees.  If otherwise eligible, an Employee or Consultant who has been
granted an Option or Right may be granted additional Options or Rights.

4.  Stock Subject to the Plan.

(a)  Shares Reserved.  Subject to the provisions of Section 12 of the Plan, the
total number of Shares reserved and available for distribution under the Plan
is 2,000,000 Shares.  Subject to Section 12 of the Plan, if any Shares that
have been optioned under an Option cease to be subject to such Option (other
than through exercise of the Option), or if any Option or Right granted
hereunder is forfeited or any such award otherwise terminates prior to the
issuance of Common Stock to the participant, the shares that were subject to
such Option or Right shall again be available for distribution in connection
with future Option or Right grants under the Plan; provided, however, that
Shares that have actually been issued under the Plan, whether upon exercise of
an Option or Right, shall not in any event be returned to the Plan and shall
not become available for future distribution under the Plan.

(b)  No Fractional Shares.  No fractional Shares may be issued under this Plan;
fractional Shares shall be rounded to the nearest whole Share.

(c)  Conditional Issuances.  If this Plan is amended at any time subject to
shareholder approval, then the Board may, in accordance with the terms and
conditions of this Plan, grant Options or Rights on a conditional basis,
subject to such approval by the shareholders of the Company not later
than the next annual meeting of the shareholders of the Company following the
date of such conditional grant.  Any Options or Rights granted on a conditional
basis shall not be exercisable unless and until the amendment to this Plan is
approved by the shareholders of the Company.  If such an amendment is not
approved by the shareholders at the next annual meeting of shareholders of the
Company following the conditional grant, then the conditional grant shall be
canceled.

5.  Administration.

(a)  Administration by the Board.  The Plan shall be administered by the Board,
including any duly appointed Committee of the Board.  All questions of
interpretation of the Plan or of any Option or Right shall be determined by the
Board, and such determinations shall be final and binding upon all persons
having an interest in the Plan or such Option or Right.  Any Officer of a
Parent or Subsidiary shall have the authority to act on behalf of the Company
with respect to any matter, right, obligation, determination or election
which is the responsibility of or which is allocated to the Company herein,
provided the officer has apparent authority with respect to such matter, right,
obligation, determination or election.

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

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

(ii)  to select the Consultants and Employees to whom Options and Rights may be
granted hereunder;

(iii)  to determine whether and to what extent Options and Rights or any
combination thereof, are granted hereunder;

(iv)  to determine the number of shares of Common Stock to be covered by each
Option and Right granted hereunder;

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

(vi)  to determine the terms and conditions, not inconsistent with the terms of
the Plan, of any award granted hereunder.  Such terms and conditions include,
but are not limited to, the exercise price, the time or times when Options or
Rights may be exercised (which may be based on performance criteria), any
vesting, acceleration or waiver of forfeiture restrictions, and any restriction
or limitation regarding any Option or Right or the shares of Common Stock
relating thereto, based in each case on such factors as the Board, in its sole
discretion, shall determine;

(vii)  to construe and interpret the terms of the Plan;

(viii)  to prescribe, amend and rescind rules and regulations relating to the
Plan;

(ix)  to determine whether and under what circumstances an Option or Right may
be settled in cash instead of Common Stock or Common Stock instead of cash;

(x)  to reduce the exercise price of any Option or Right;

(xi)  to modify or amend each Option or Right (subject to Section 14 of the
Plan);

(xii)  to authorize any person to execute on behalf of the Company any
instrument required to effect the grant of an Option or Right previously
granted by the Board;

(xiii)  to institute an Option Exchange Program;

(xiv)  to determine the terms and restrictions applicable to Options and Rights
and any Restricted Stock; and

(xv)  to make all other determinations deemed necessary or advisable for
administering the Plan.

(c)  Effect of Board's Decision.  The Board's decisions, determinations and
interpretations shall be final and binding on all Optionees and any other
holders of Options or Rights.

(d)  Limitations on Grants.  The following limitations will apply to grants of
Options and Rights under the Plan:

(i)  no Employee or Consultant will be granted Options or Rights under the Plan
to receive more than 100,000 Shares in any one fiscal year; and

(ii)  no Employee or Consultant will be granted Options or Rights under the
Plan to purchase more than 500,000 Shares over the term of the Plan, provided
that, if the number of Shares available for issuance under Paragraph 4 of the
Plan is increased, the maximum number of Options or Rights that any Employee or
Consultant may be granted will also increase by a pro rata amount for each
additional fiscal year in which Shares are allocated for issuance under the
Plan.

(e)  Rule 16b-3 Compliance.  It is the intent that this Plan and all Options
and Rights granted pursuant to it shall be administered, in the discretion of
the Board, so as to permit this Plan and the Options and Rights to comply with
Exchange Act Rule 16b-3.  With respect to grants of Options and Rights to
Executive Officers and Directors, the Plan will be administered by the full
Board or a Committee to satisfy Rule 16b-3 to the extent the Board determines,
in its sole discretion, that compliance with Rule 16b-3 is necessary or
desirable.  If any provision of this Plan or of any Options and Rights would
otherwise frustrate or conflict with the intent expressed in this Section 5
(e), that provision, to the extent the Board determines it possible, necessary,
or desirable, shall be interpreted and deemed amended in the manner determined
by the Board so as to avoid such conflict.  To the extent of any remaining
irreconcilable conflict with such intent, the provision shall be deemed void as
applicable to Optionees who are then subject to the reporting requirements of
Section 16 of the Exchange Act to the extent permitted by law and in the manner
deemed advisable by the Committee.

6.  Duration of the Plan.  The Plan shall remain in effect until terminated by
the Board under the terms of the Plan, provided that in no event may Incentive
Stock Options be granted under the Plan later than 10 years from the date the
Plan was adopted by the Board.

7.  Options.

(a)  Options.  The Board, in its discretion, may grant Options to eligible
participants and shall determine whether such Options shall be Incentive Stock
Options or Nonqualified Stock Options.  Each Option shall be evidenced by a
Notice of Grant/Option Agreement which shall expressly identify the Options as
Incentive Stock Options or as Nonqualified Stock Options, and be in such form
and contain such provisions as the Board shall from time to time deem
appropriate.  The Notice of Grant/Option Agreement shall govern each Optionee's
rights and obligations with respect to each such particular Option.  Without
limiting the foregoing, the Board may at any time authorize the Company, with
the consent of the respective recipients, to issue new Options or Rights in
exchange for the surrender and cancellation of outstanding Options or Rights.
Option agreements shall contain the following terms and conditions:

(i)  Exercise Price; Number of Shares.  The per Share exercise price for the
Shares issuable pursuant to an Option shall be such price as is determined by
the Board; provided, however, that in the case of an Incentive Stock Option,
the price shall be no less than 100% of the Fair Market Value of the Common
Stock on the date the Option is granted, subject to any additional conditions
set out in Section 7(a)(iv) below.  In the case of a Nonqualified Stock Option,
the per share exercise price for the Shares issuable pursuant to an Option
shall be such price as is determined by the Board; provided, however, the price
shall not be less than 100% of the Fair Market Value of the Common Stock on the
date the Option is granted.

(1)  The Notice of Grant shall specify the number of Shares to which it
pertains.

(ii)  Waiting Period and Exercise Dates.  At the time an Option is granted,
the Board will determine the terms and conditions to be satisfied before Shares
may be purchased, including the dates on which Shares subject to the Option may
first be purchased.  The Board may specify that an Option may not be exercised
until the completion of the service period specified at the time of grant.
(Any such period is referred to herein as the "waiting period.") At the time an
Option is granted, the Board shall fix the period within which the Option may
be exercised, which shall not be earlier than the end of the waiting period, if
any, nor, in the case of an Incentive Stock Option, later than ten (10) years,
from the date of grant.

(iii)  Form of Payment.  The consideration to be paid for the Shares to be
issued upon exercise of an Option, including the method of payment, shall be
determined by the Board (and, in the case of an Incentive Stock Option, shall
be determined at the time of grant) and may consist entirely of:

(1)  cash;

(2) check;

(3) promissory note;

(4) other Shares which (a) in the case of Shares acquired upon exercise
of an option, have been owned by the Optionee for more than six months on the
date of surrender, unless otherwise permitted under Applicable Laws, including
Rule 16b-3 and Section 16(b) of the Exchange Act, and (b) have a Fair Market
Value on the date of surrender not greater than the aggregate exercise price of
the Shares as to which said Option shall be exercised;

(5)  delivery of a properly executed exercise notice together with such
other documentation as the Board and the broker, if applicable, shall require
to effect an exercise of the Option and delivery to the Company of the sale or
loan proceeds required to pay the exercise price, or the use of such other
procedures which shall effect a cashless exercise;

(6)  any combination of the foregoing methods of payment; or

(7)  such other consideration and method of payment for the issuance of
Shares to the extent permitted by Applicable Laws.

(iv)  Special Incentive Stock Option Provisions.  In addition to the foregoing,
Options granted under the Plan which are intended to be Incentive Stock Options
under Section 422 of the Code shall be subject to the following terms and
conditions:

(1)  Dollar Limitation.  To the extent that the aggregate Fair Market Value
of (a) the Shares with respect to which Options designated as Incentive Stock
Options plus (b) the shares of stock of the Company, Parent and any Subsidiary
with respect to which other incentive stock options are exercisable for the
first time by an Optionee during any calendar year under all plans of the
Company and any Parent and Subsidiary exceeds $100,000, such Options shall be
treated as Nonqualified Stock Options.  For purposes of the preceding sentence,
(x) Options shall be taken into account in the order in which they were granted,
and (y) the Fair Market Value of the Shares shall be determined as of the time
the Option or other incentive stock option is granted.

(2)  10% Shareholder.  If any Optionee to whom an Incentive Stock Option is
to be granted pursuant to the provisions of the Plan is, on the date of grant,
the owner of Common Stock (as determined under Section 424(d) of the Code)
possessing more than 10% of the total combined voting power of all classes of
stock of the Company or any Parent or Subsidiary of the Company, then the
following special provisions shall be applicable to the Option granted to such
individual:

(a)  The per Share Option price of Shares subject to such Incentive Stock
Option shall not be less than 110% of the Fair Market Value of Common Stock on
the date of grant:
and

(b)  The Option shall not have a term in excess of five (5) years from the
date of grant.

Except as modified by the preceding provisions of this subsection 7(a)(iv) and
except as otherwise limited by Section 422 of the Code, all of the provisions
of the Plan shall be applicable to the Incentive Stock Options granted
hereunder.

(v)  Other Provisions.  Each Option granted under the Plan may contain such
other terms, provisions, and conditions not inconsistent with the Plan as may
be determined by the Board.

(vi)  Buyout Provisions.  The Board may at any time offer to buy out for a
payment in cash or Shares, an Option previously granted, based on such terms
and conditions as the Board shall establish and communicate to the Optionee at
the time that such offer is made; provided, however, that buyout offers made to
Officers, Directors, and 10% shareholders may only be payable in cash and shall
comply with Rule 16b-3 to the extent deemed desirable or required by the Board.

(b)  Method of Exercise.

(i)  Procedure for Exercise, Rights as a Shareholder.  Any Option or SAR
granted hereunder shall be exercisable at such times and under such conditions
as determined by the Board and as shall be permissible under the terms of the
Plan.

An Option or SAR shall be deemed to be exercised when written notice of such
exercise has been given to the Company in accordance with the terms of the
Option or SAR by the person entitled to exercise the Option or SAR and full
payment for the Shares with respect to which the Option is exercised has been
received by the Company.  Full payment may, as authorized by the Board (and, in
the case of an Incentive Stock Option, determined at the time of grant) and
permitted by the Option Agreement consist, of any consideration and method of
payment allowable under subsection 7(a)(iii) of the Plan.  Until the issuance
(as evidenced by the appropriate entry on the books of the Company or of a duly
authorized transfer agent of the Company) of the stock certificate evidencing
such Shares, no right to vote or receive dividends or any other rights as a
shareholder shall exist with respect to the Optioned Stock, notwithstanding the
exercise of the Option.  No adjustment will be made for a dividend or other
right for which the record date is prior to the date the stock certificate is
issued, except as provided in Section 12 of the Plan.

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

(ii)  Rule 16b-3.  Options and SARs granted to individuals subject to Section
16 of the Exchange Act ("Insiders") may, in the discretion of the Board, comply
with the applicable provisions of Rule 16b-3 and may contain such additional
conditions or restrictions as may be required thereunder to qualify for the
maximum exemption from Section 16 of the Exchange Act with respect to Plan
transactions.

(iii)  Termination of Employment or Consulting Relationship.  In the event an
Optionee's Continuous Status as an Employee or Consultant terminates (other
than upon the Optionee's death or Disability), the Optionee may exercise his or
her Option or SAR, but only within such period of time as is determined by the
Board at the time of grant, not to exceed six (6) months, (three (3) months in
the case of an Incentive Stock Option) from the date of such termination, and
only to the extent that the Optionee was entitled to exercise it at the date of
such termination (but in no event later than the expiration of the term of such
Option or SAR as set forth in the SAR or Option Agreement).  To the extent that
Optionee was not entitled to exercise an Option or SAR at the date of such
termination, and to the extent that the Optionee does not exercise such Option
or SAR (to the extent otherwise so entitled) within the time specified herein,
the Option or SAR shall terminate.

(iv)  Disability of Optionee.  In the event an Optionee's Continuous Status as
an Employee or Consultant terminates as a result of the Optionee's Disability,
the Optionee may exercise his or her Option or SAR, but only within six (6)
months from the date of such termination, and only to the extent that the
Optionee was entitled to exercise it at the date of such termination (but in no
event later than the expiration of the term of such Option or SAR as set forth
in the Option or SAR Agreement).  To the extent that Optionee was not entitled
to exercise an Option or SAR at the date of such termination, and to the extent
that the Optionee does not exercise such Option or SAR (to the extent otherwise
so entitled) within the time specified herein, the Option or SAR shall
terminate.

(v)  Death of Optionee.  In the event of an Optionee's death, the Optionee's
estate or a person who acquired the right to exercise the deceased Optionee's
Option or SAR by bequest or inheritance may exercise the Option or SAR, but
only within twelve (12) months following the date of death, and only to the
extent that the Optionee was entitled to exercise it at the date of death (but
in no event later than the expiration of the term of such Option or SAR as set
forth in the Option or SAR Agreement).  To the extent that Optionee was not
entitled to exercise an Option or SAR at the date of death, and to the extent
that the Optionee's estate or a person who acquired the right to exercise such
Option or SAR does not exercise such Option or SAR (to the extent otherwise so
entitled) within the time specified herein, the Option or SAR shall terminate.

8.  Stock Appreciation Rights

All Stock Appreciation Rights granted under the Plan shall comply with, and
the related SAR Agreement shall be deemed to include and be subject to, the
applicable terms and conditions set forth in this Section 8 and also the terms
and conditions set forth in Section 12 and Section 7(b) (iii), (iv), and (v);
provided, however, that the Committee may authorize an SAR Agreement related
to a Stock Appreciation Right that expressly contains terms and provisions that
differ from the terms and provisions set forth in Section 12 and any of the
terms and provisions of Section 7(b)(iii), (iv), or (v).

(a)  Form of Right.  A Stock Appreciation Right may be granted (i) in
connection with an Option, either at the time of grant or at any time
during the term of the Option, or (ii) without relation to an Option.

(b)  Rights Related to Options.  A Stock Appreciation Right granted pursuant
to an Option shall entitle the Optionee, upon exercise, to surrender that
Option or any portion thereof, to the extent unexercised, and to receive
payment of any amount computed pursuant to Section 8(b)(ii).  That Option shall
then cease to be exercisable to the extent surrendered.  Stock Appreciation
Rights granted in connection with an Option shall be subject to the terms of
the SAR Agreement governing the Option, which shall comply with the following
provisions in addition to those applicable to Options:

(i)  Exercise and Transfer.  Subject to Section 15, a Stock Appreciation Right
granted in connection with an Option shall be exercisable only at such time or
times and only to the extent that the related Option is exercised and shall not
be transferable except to the extent that the related Option is transferable.
To the extent that an Option has been exercised, the Stock Appreciation Rights
granted in connection with such Option shall terminate.

(ii)  Value of Right.  Upon the exercise of a Stock Appreciation Right related
to an Option, the Optionee shall be entitled to receive payment from the
Company of an amount determined by multiplying:

(a)  The difference obtained by subtracting the exercise price of a Share
specified in the related Option from the Fair Market Value of a Share on the
date of exercise of the Stock Appreciation Right, by

(b)  The number of Shares as to which that Stock Appreciation Right has
been exercised.

(c)  Right Without Option.  A Stock Appreciation Right granted without
relationship to an Option shall be exercisable as determined by the Board and
set forth in the SAR Agreement governing the Stock Appreciation Right, which
SAR Agreement shall comply with the following provisions:

(i)  Number of Shares.  Each SAR Agreement shall state the total number of
Shares to which the Stock Appreciation Right relates.

(ii)  Vesting.  Each SAR Agreement shall state the time or periods in which the
right to exercise the Stock Appreciation Right or a portion thereof shall vest
and the number of Shares for which the right to exercise the Stock Appreciation
Right shall vest at each such time or period.

(iii)  Expiration of Rights.  Each SAR Agreement shall state the date at which
the Stock Appreciation Rights shall expire if not previously exercised.

(iv)  Value of Right.  A Stock Appreciation Right granted without relationship
to an Option shall entitle the Optionee or holder of a SAR, upon exercise of
the Stock Appreciation Right, to receive payment of an amount determined by
multiplying:

(a)  The difference obtained by subtracting the Fair Market Value of a
Share on the date the Stock Appreciation Right is granted from the Fair Market
Value of a Share on the date of exercise of that Stock Appreciation Right, by

(b)  The number of rights as to which the Stock Appreciation Right has
been exercised.

(d)  Limitations on Rights.  Notwithstanding Section 8(b)(ii) and Section
8(c)(iv), the Board may limit the amount payable upon exercise of a
Stock Appreciation Right.  Any such limitation must be determined on the date
of the Notice of Grant and be noted on the instrument evidencing the Optionee's
Stock Appreciation Right.

(e)  Payment of Rights.  Payment of the amount determined under
Section 8(b)(ii) or Section 8(c)(iv) and Section 8(d) may be made solely in
whole Shares valued at Fair Market Value on the date of exercise of the Stock
Appreciation Right or, in the sole discretion of the Board solely in cash or a
combination of cash and Shares.  If the Board decides to make full payment in
Shares and the amount payable results in a fractional Share, payment for the
fractional Share shall be made in cash.

(f)  Stockholder Privileges.  No Employee or Consultant shall have any rights
as a stockholder with respect to any Shares covered by a Stock Appreciation
Right until the Employee or Consultant becomes the holder of record
of such Common Stock, and no adjustments shall be made for dividends or other
distributions or other rights as to which there is a record date preceding the
date such Employee or Consultant becomes the holder of record of such Common
Stock.

(g)  Other Agreement Provisions.  The SAR Agreements authorized
relating to Stock Appreciation Rights shall contain such provisions in addition
to those required by the Plan (including, without limitation, restrictions or
the removal of restrictions upon the exercise of the Stock Appreciation Right
and the retention or transfer of shares thereby acquired as the Board may deem
advisable.

9.  Stock Purchase Rights.

(a)  Grant of Restricted Stock.  Subject to the terms and
provisions of the Plan, the Board, at any time and from time to time, may grant
Stock Purchase Rights to Employees and Consultants in such amounts as the Board
in its sole discretion shall determine.

(b)  Restricted Stock Purchase Agreement.  Each Restricted Stock
grant shall be evidenced by a Restricted Stock Purchase Agreement that shall
specify the period of time during which the transfer of Restricted Stock is
limited in some way, including the passage of time, achievement of performance
goals, or upon the occurrence of other events as determined by the Board in its
sole discretion ("Period of Restriction"), the number of Shares of Restricted
Stock granted, and such other provisions as the Board, in its sole discretion,
shall determine.

(c)  Transferability.  Except as provided in this Section 9(c), the Restricted
Stock granted herein may not be sold, transferred, pledged, assigned, or
otherwise alienated or hypothecated until the end of the applicable Period of
Restriction established by the Board and specified in the Restricted Stock
Purchase Agreement, or upon earlier satisfaction of any other conditions, as
specified by the Board in its sole discretion and set forth in the Restricted
Stock Purchase Agreement.  The Restricted Stock is subject to substantial risk
of forfeiture during the Period of Restriction.

(d)  Other Restrictions.  The Board shall impose such other restrictions
on any Restricted Stock granted pursuant to the Plan as it may deem advisable
including, without limitation, restrictions based upon the achievement
of specific performance goals (Company-wide, Subsidiary, and/or individual),
and/or restrictions under applicable Federal or state securities laws, and may
legend the certificate representing Restricted Stock to give appropriate notice
for such restrictions.  The Restricted Stock shall be deposited in escrow with
the Company until the Restricted Stock is vested and the Period of Restriction
is terminated.

(e)  Certificate Legend.  In addition to any legends placed on
certificates pursuant to this Section 9(e) each certificate representing
Restricted Stock granted pursuant to the Plan shall bear the following legend:

"The sale or other transfer of the Shares of stock represented by this
Certificate, whether voluntary, involuntary, or by operation of law, is subject
to certain restrictions on transfer as set forth in the SGI International 1996
Omnibus Stock Plan and in a Restricted Stock Purchase Agreement dated November
7, 1996.  A copy of the Plan and such Restricted Stock Purchase Agreement may
be obtained from the Chief Financial Officer of SGI International."

(f)  Removal of Restrictions.  Except as otherwise provided in
this Section 9, Restricted Stock covered by each Restricted Stock grant made
under the Plan shall become freely transferable by the participant after the
last day of the Period of Restriction.  The Board, in its discretion, may
accelerate the time at which any restriction shall lapse and/or remove any
restrictions. Once the Shares are released from the restrictions, the Employee
or Consultant shall be entitled to have the legend required by Section 9(e)
removed from his or her Share certificate.

(g)  Voting Rights.  During the Period of Restriction, Employees or Consultants
holding Shares of Restricted Stock granted hereunder may exercise
full voting rights with respect to those Shares.

(h)  Dividends and Other Distributions.  During the Period of Restriction,
Employees or Consultants holding Shares of Restricted Stock granted hereunder
shall be entitled to receive all dividends and other distributions paid with
respect to those Shares while they are so held.  If any such dividends
or distributions are paid in Shares, the Shares shall be subject to the same
restrictions on transferability and forfeitability as the Restricted Stock with
respect to which they were paid.

(i)  Termination of Employment Due to Death, Disability, or Retirement.  In the
event that an Employee or Consultant's employment with the Company is
terminated by reason of death or Disability, the restrictions on the Employee
or Consultant's Restricted Stock shall lapse as of the date of termination
(in the case of Disability, the restrictions shall lapse on the date
the Employee or Consultant's Disability is determined by the Board to be total
and permanent).

(j)  Termination of Employment for Other Reasons.  If the employment of the
Employee or Consultant shall terminate for any reason other than those reasons
described in Section 9(i), including termination for cause, all nonvested
Restricted Stock held by the Employee or Consultant at that time shall be
subject to the repurchase option of the Company, unless the Board determines
otherwise.  However, with the exception of a termination of employment for
cause, the Board, in its sole discretion, shall have the right to provide
for lapsing of the restrictions on Restricted Stock following employment
termination, upon such terms and provisions as it deems proper.

(k)  Rule 16b-3.  If the Company has any class of equity security
registered pursuant to Section 12 of the Exchange Act, Stock Purchase
Rights granted to Insiders, and Shares purchased by Insiders in connection with
the Stock Purchase Rights, may be, in the discretion of the Board, subject to
any restrictions applicable thereto in compliance with Rule 16b-3.  An Insider
may only purchase Shares pursuant to the grant of a Stock Purchase Right and
may only sell Shares purchased pursuant to the grant of a Stock Purchase Right,
during such time or times as are permitted by Rule 16b-3, unless waived in the
sole discretion of the Board.

10.  Long-Term Performance Awards.

(a)  Administration.  Long-Term Performance Awards are cash or stock bonus
awards that may be granted either alone or in addition to other awards granted
under the Plan.  Such awards shall be granted for no cash consideration.  The
Board shall determine the nature, length and starting date of any performance
period (the "Performance Period") for each Long-Term Performance Award, and
shall determine the performance or employment factors, if any, to be used in
the determination of Long-Term Performance Awards and the extent to which such
Long-Term Performance Awards are valued or have been earned.  Long-Term
Performance Awards may vary from participant to participant and between groups
of participants and shall be based upon the achievement of Company, Subsidiary,
Parent and/or individual performance factors or upon such other criteria as
the Board may deem appropriate.  Performance Periods may overlap and
participants may participate simultaneously with respect to Long-Term
Performance Awards that are subject to different Performance Periods and
different performance factors and criteria.  Long-Term Performance Awards shall
be confirmed by, and be subject to the terms of, a Long-Term Performance
Award agreement.  The terms of such awards need not be the same with respect to
each participant.

At the beginning of each Performance Period, the Board may determine for each
Long-Term Performance Award subject to such Performance Period the range of
dollar values or number of shares of Common Stock to be awarded to the
participant at the end of the Performance Period if and to the extent that the
relevant measures of performance for such Long-Term Performance Award are met.
Such dollar values or number of shares of Common Stock may be fixed or may vary
in accordance with such performance or other criteria as may be determined by
the Board.

(b)  Adjustment of Awards.  The Board may adjust the performance
factors applicable to the Long-Term Performance Awards to take into account
changes in legal, accounting and tax rules and to make such adjustments as the
Board deems necessary or appropriate to reflect the inclusion or exclusion of
the impact of extraordinary or unusual items, events or circumstances in order
to avoid windfalls or hardships.

11.  Non-Transferability of Options.  Options and Rights may not be sold,
pledged, assigned, hypothecated, transferred or disposed of in any manner other
than by will or by the laws of descent or distribution and may be exercised,
during the lifetime of the Optionee, only by the Optionee.

12.  Adjustments Upon Changes in Capitalization, Dissolution, Merger, Asset
Sale or Change of Control.

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

(b)  Dissolution or Liquidation.  In the event of the proposed dissolution or
liquidation of the Company, to the extent that an Option or Right has not been
previously exercised, it will terminate immediately prior to the consummation
of such proposed action.  The Board may, in the exercise of its sole discretion
in such instances, declare that any Option or Right shall terminate as of a
date fixed by the Board and give each Optionee the right to exercise his or her
Option or Right as to all or any part of the Optioned Stock, including Shares
as to which the Option or Right would not otherwise be exercisable.

(c)  Merger or Asset Sale.  Subject to the provisions of paragraph (d) hereof,
in the event of a merger of the Company with or into another corporation, or
the sale of substantially all of the assets of the Company, each outstanding
Option and Right shall be assumed, or an equivalent Option or Right
substituted, by the successor corporation or a Parent or Subsidiary of the
successor corporation.  In the event that the successor corporation does not
agree to assume the Option or to substitute an equivalent option, the Board
shall, in lieu of such assumption or substitution, provide for the Optionee to
have the right to exercise the Option or Right as to all or a portion of the
Optioned Stock, including Shares as to which it would not otherwise be
exercisable.  If the Board makes an Option or Right exercisable in lieu of
assumption or substitution in the event of a merger or sale of assets, the
Board shall notify the Optionee that the Option or Right shall be exercisable
for a period of fifteen (15) days from the date of such notice, and the Option
or Right will terminate upon the expiration of such period.  For the purposes
of this paragraph, the Option or Right shall be considered assumed if,
immediately following the merger or sale of assets, the Option or Right confers
the right to purchase, for each Share of Optioned Stock subject to the Option
or Right immediately prior to the merger or sale of assets, for the
consideration (whether stock, cash, or other securities or property) received
in the merger or sale of assets by holders of Common Stock for each Share held
on the effective date of the transaction (and if holders were offered a choice
of consideration, the type of consideration chosen by the holders of a majority
of the outstanding Shares); provided, however, that if such consideration
received in the merger or sale of assets was not solely common stock of the
successor corporation or its Parent, the Board may, with the consent of the
successor corporation and the participant, provide for the consideration to be
received upon the exercise of the Option or Right, for each Share of Optioned
Stock subject to the Option or Right, to be solely common stock of the
successor corporation or its Parent equal in Fair Market Value to the per share
consideration received by holders of Common Stock in the merger or sale of
assets.

(d)  Change in Control.  In the event of a "Change in Control" of the Company,
as defined in paragraph (e) below, then the following acceleration and
valuation provisions shall apply:

(i)  Except as otherwise determined by the Board, in its discretion, prior to
the occurrence of a Change in Control, any Options and Rights outstanding on
the date such Change in Control is determined to have occurred that are not yet
exercisable and vested on such date shall become fully exercisable and vested;

(ii)  Except as otherwise determined by the Board, in its discretion, prior to
the occurrence of a Change in Control, all outstanding Options and Rights, to
the extent they are exercisable and vested (including Options and Rights that
shall become exercisable and vested pursuant to subparagraph (i) above), shall
be terminated in exchange for a cash payment equal to the Change in Control
Price, (reduced by the exercise price, if any, applicable to such Options or
Rights).  These cash proceeds shall be paid to the Optionee or, in the event of
death of an Optionee prior to payment, to the estate of the Optionee or to a
person who acquired the right to exercise the Option or Right by bequest or
inheritance.

(e)  Definition of "Change in Control".  For purposes of this
Section 12, a "Change in Control" means the happening of any of the following:

(i)  When any "person," as such term is used in Section 13(d) and 14(d) of the
Exchange Act (other than the Company, a Subsidiary or a Company employee
benefit plan, including any trustee of such plan acting as trustee) is or
becomes the "beneficial owner" (as defined in Rule 13d-3 under the Exchange
Act), directly or indirectly, of securities of the Company representing fifty
percent (50%) or more of the combined voting power of the Company's then
outstanding securities entitled to vote generally in the election of directors;
or

(ii)  A merger or consolidation of the Company with any other corporation,
other than a merger or consolidation which would result in the voting
securities of the Company outstanding immediately prior thereto continuing to
represent (either by remaining outstanding or by being converted into voting
securities of the surviving entity) at least fifty percent (50%) of the total
voting power represented by the voting securities of the Company or such
surviving entity outstanding immediately after such merger or consolidation, or
the shareholders of the Company approve an agreement for the sale or
disposition by the Company of all or substantially all the Company's assets; or

(iii)  A change in the composition of the Board of Directors of the Company
occurring within a two-year period, as a result of which fewer than a majority
of the directors are Incumbent Directors.

"Incumbent Directors" shall mean directors who either (x) are directors of the
Company as of the date the Plan is approved by the Board or the shareholders,
whichever shall first occur, or (y) are elected, or nominated for election, to
the Board of the Company with the affirmative votes of at least a majority
of the Incumbent Directors at the time of such election or nomination (but
shall not include an individual whose election or nomination is in connection
with an actual or threatened proxy contest relating to the election of
directors to the Company).

(f)  Change in Control Price.  For purposes of this Section 12, "Change in
Control Price" shall be, as determined by the Board, (i) the highest Fair
Market Value of a Share within the 60-day period immediately preceding the date
of determination of the Change in Control Price by the Board (the "60--Day
Period"), or (ii) the highest price paid or offered per Share, as determined by
the Board, in any bona fide transaction or bona fide offer related to the
Change in Control of the Company, at any time within the 60-Day Period, or
(iii) such lower price as the Board, in its discretion, determines to be a
reasonable estimate of the fair market value of a Share.

13.  Date of Grant.  The date of grant of an Option or Right shall be,
for all purposes, the date on which the Board makes the determination granting
such Option or Right, or such other later date as is determined by the Board.
Notice of the determination shall be provided to each Optionee within a
reasonable time after the date of such grant.

14.  Amendment and Termination of the Plan.

(a)  Amendment and Termination.  The Board may at any time amend, alter,
suspend or terminate the Plan for any reason.

(b)  Shareholder Approval.  The Company shall obtain shareholder approval
of any Plan amendment to the extent requested by Applicable Law, rule or
regulation, including the requirements of any exchange or quotation system on
which the Common Stock is listed or quoted. Such shareholder approval, if
required, shall be obtained in such a manner and to such a degree as is
required by the Applicable Laws, rules or regulations.

(c)  Effect of Amendment or Termination.  No amendment, alteration, suspension
or termination of the Plan shall impair the rights of any Optionee, unless
mutually agreed otherwise between the Optionee and the Board, which agreement
must be in writing and signed by the Optionee and the Company unless such
amendment, alteration, suspension or termination is required to enable an
Option designated as an Incentive Stock Option to qualify as an Incentive Stock
Option or is necessary to comply with any Applicable Laws or government
regulations.

15.  Conditions Upon Issuance of Shares.

(a)  Legal Compliance.  Shares shall not be issued pursuant to the exercise of
an Option or Right unless the exercise of such Option or Right and the issuance
and delivery of such Shares shall comply with all relevant provisions of law,
including, without limitation, the Securities Act of 1933 ("Securities Act"),
as amended, the Exchange Act, the securities laws of applicable states, the
rules and regulations promulgated thereunder, Applicable Laws, and the
requirements of any stock exchange or quotation system upon which the Shares
may then be listed or quoted, and shall be further subject to the approval of
counsel for the Company with respect to such compliance.

(b)  Investment Representations Re: Federal Securities Laws.
The Shares underlying these Options and Rights, as of the date hereof, have not
been registered under the Securities Act.  The Optionee represents that if
Options or Rights are exercised in whole or in part at a time when there is not
in effect, under the Securities Act, a registration statement applicable to the
Shares issuable upon exercise, then the purchase of such Shares is expressly
conditioned upon the following representations, warranties and covenants:

(i)  Investment Intent.  Optionee is acquiring the Shares for its own account,
not as a nominee or agent, and not with a view to their resale or distribution
and is prepared to hold the Shares for an indefinite period and has no present
intention to sell, distribute, or grant any participating interests in the
Shares.  Optionee acknowledges the Shares have not been registered under the
Securities Act or the securities laws of any other state, province or country
(collectively, with the 1933 Act, the "Securities Laws"), and that the Company
is issuing the Shares to it in reliance on its representations made herein.

(ii)  Restricted Securities.  Optionee hereby confirms it has been informed
that the Shares may not be resold or transferred unless such Shares are first
registered under the applicable Securities Laws or unless an exemption from
such registration is available. Accordingly, Optionee acknowledges it is
prepared to hold the Shares for an indefinite period.

(iii)  Investment Experience.  In connection with the investment
representations made herein, Optionee represents that it is able to fend for
itself in the transactions contemplated by this Plan, has such knowledge and
experience in financial and business matters as to be capable of evaluating the
merits and risks of its investment, has the ability to bear the economic risks
of its investment, and has been furnished with and has had access to such
information as is normally made available in the form of a registration
statement, together with such additional information as is necessary to verify
the accuracy of the information supplied and to have all questions answered by
the Company.

(iv)  Disposition of Shares.  Optionee agrees that it shall make no disposition
of the Shares, unless and until:

(a)  Optionee shall have complied with all requirements of this Agreement and
any stock exchange on which such Shares (or any substituted securities) may be
listed;

(b)  Optionee shall have notified the Company of the proposed disposition and
furnished it with a written summary of the terms and conditions of the proposed
disposition; and

(c)  Optionee shall have provided an opinion to the Company's counsel (at
optionee's expense), in form and substance reasonably satisfactory to
the Company, that (x) the proposed disposition does not require
registration of the Shares under the applicable Securities Laws or (y)
all appropriate action necessary for compliance with the registration
requirements of the applicable Securities Laws or of any exemption from
registration available under the applicable Securities Laws has been
taken.

16.  Liability of Company.

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

(b)  Grants Exceeding Allotted Shares.  If the Optioned Stock covered by an
Option or Right exceeds, as of the date of grant, the number of Shares which
may be issued under the Plan without additional shareholder approval, such
Option or Right shall be void with respect to such excess Optioned Stock,
unless shareholder approval of an amendment sufficiently increasing the number
of Shares subject to the Plan is timely obtained in accordance with Section
14(b) of the Plan.

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

18.  Provision of Information.  At least annually, copies of the Company's
annual report or Form 10-K for the just completed fiscal year shall be
made available to each Optionee and purchaser of Shares upon exercise of an
Option or Right.  The Company shall not be required to provide such information
to persons whose duties in connection with the Company assure them access to
equivalent information.

19.  Plan Does Not Affect Employment Status.

(a)  Status as an Employee or Consultant shall not be construed
as a commitment that any Option or Right will be made under the Plan to such
Employee or Consultant or to eligible Employees or Consultants generally.

(b)  Nothing in the Plan or in any Agreement or related documents shall
confer upon any Employee or Consultant or Optionee any right to continue
in the employment of the Company or any Parent or Subsidiary or constitute
any contract of employment or affect any right which the Company or any Parent
or Subsidiary may have to change such person's compensation, other benefits,
job responsibilities, or title, or to terminate the employment of such
person with or without cause.

20.  Unfunded Plan.  The Plan shall be unfunded and the Company shall not be
required to segregate any assets that may at any time be represented by Options
or Rights under the Plan.  Neither the Company, its Parent or Subsidiary,
nor the Board shall be deemed to be a trustee of any amounts to be paid under
the Plan, nor shall anything contained in the Plan or any action taken pursuant
to its provisions create or be construed to create a fiduciary relationship
between the Company and/or its Parent or Subsidiary and an Optionee.  To the
extent any person acquires a right to receive an Option or Right under the
Plan, such right shall be no greater than the right of an unsecured general
creditor of the Company.

21.  Indemnification.  In addition to such other rights of indemnification as
they may have as members of the Board or Officers or employees of the Company
and any Parent or Subsidiary, members of the Board and any Officers or
employees of the Company and any Parent or Subsidiary to whom authority to act
for the Board is delegated shall be indemnified by the Company against all
reasonable expenses, including attorneys= fees, actually and necessarily
incurred in connection with the defense of any action, suit or proceeding, or
in connection with any appeal therein, to which they or any of them may be a
party by reason of any action taken or failure to act under or in connection
with the Plan, or any right granted hereunder, and against all amounts paid by
them in settlement thereof (provided such settlement is approved by independent
legal counsel selected by the Company) or paid by them in satisfaction of a
judgment in any such action, suit or proceeding, except in relation to matters
as to which it shall be adjudged in such action, suit or proceeding that such
person is liable for gross negligence, bad faith or intentional misconduct in
duties; provided, however, that within sixty (60) days after the institution of
such action, suit or proceeding, such person shall offer to the Company, in
writing, the opportunity at its own expense to handle and defend the same.

22.  Stock Withholding to Satisfy Withholding Tax Obligations

(a)  Ability to Use Stock to Satisfy Withholding.  At the discretion of the
Company, Optionees may satisfy withholding obligations as provided in this
Section 22.  When an Optionee incurs tax liability in connection with the
award, vesting or exercise of an Option or Right, which tax liability is
subject to tax withholding under applicable tax laws (including federal, state
and local laws), the Optionee may satisfy the withholding tax obligation (up
to an amount calculated by applying such Optionee's maximum marginal tax rate)
by electing to have the Company withhold from the Shares to be issued upon
award, vesting or exercise of the Option or Right, that number of Shares, or by
delivering to the Company that number of previously owned Shares, having a Fair
Market Value (as defined in the Plan) equal to the amount required to be
withheld. The Fair Market Value of the Shares to be withheld or delivered, as
the case may be, shall be determined on the date that the amount of tax to be
withheld is determined (the "Tax Date").

(b)  Election to Have Shares Withheld.  All elections by an
Optionee to have Shares withheld or to deliver previously owned Shares pursuant
to this Section 22 shall be made in writing in a form acceptable to the Company
and shall be subject to the following restrictions:

(i)  the election must be made on or prior to the application Tax Date;

(ii)  all elections shall be subject to the consent or disapproval of the
Company; and

(iii)  if the Optionee is subject to Section 16 of the Securities Act, the
election shall, to the extent practicable, desirable, or as determined by the
Board, comply with the applicable provisions of Rule 16b-3 and may be subject
to such additional conditions or restrictions as may be required thereunder to
qualify for the maximum exemption from Section 16 of the Exchange Act with
respect to Plan transactions.

(c)  Section 83(b) Elections.  In the event that (i) an election to have the
Shares withheld is made by an Optionee, (ii) no election is filed under
Section 83(b) of the Internal Revenue Code by such Optionee, and (iii) the Tax
Date is deferred under Section 83 of the Internal Revenue Code, the Optionee
shall receive the full number of Shares with respect to which the Option or
Right has been awarded, has vested or has been exercised, as the case may be,
but such Optionee shall be unconditionally obligated to tender back to the
Company the proper number of Shares on the Tax Date.

23.  Shareholder Approval.  Continuance of the Plan shall be subject to
approval by the shareholders of the Company within twelve (12) months after the
date the Plan is adopted.  Such shareholder approval shall be obtained in the
manner and to the degree required under applicable federal and state law.

Adopted by the Board of Directors on November 7, 1996

ATTEST:

SGI International



By: ___________________________
John R. Taylor, General Councel