Exhibit 10.5


                        EXHIBIT A

                DIRECTOR STOCK OPTION AGREEMENT


This Stock Option Agreement (the "Agreement"), made this ____ day 
of _______, ____, by and between Lab Holdings, Inc. ("LHI") and 
____________ ______________________ (the "Grantee") evidences the 
grant, by LHI, of a Stock Option (the "Option") to the Grantee 
effective on __________, ____, (the "Date of Grant") and the Grantee's 
acceptance of the Option in accordance with the provisions of the Lab 
Holdings, Inc. 1997 Directors' Stock Option Plan (the "Plan").  LHI 
and the Grantee agree as follows:

1.      Shares Optioned and Option Price.  The Grantee shall have an 
option to purchase ________ shares of LHI common stock, par value 
$1.00 per share, for $_________ per share, subject to the terms and 
conditions of this Agreement and of the Plan, the provisions of which 
are hereby incorporated herein by reference.  The shares subject to 
the Option are not, nor are they intended to be, Incentive Stock 
Option (ISO) shares as described in section 422 of the Internal 
Revenue Code of 1986, as amended.

2.      Vesting.  Except as otherwise provided in section 3 below or 
in the Plan, this Option shall be deemed vested with respect to the 
number of shares described in section 1 as follows:  (a) the right to 
purchase one-third of the number of shares described in section 1 
shall first be vested on the first anniversary of the Date of Grant, 
(b) the right to purchase one-half of the remaining number of unvested 
shares shall first be vested on the second anniversary of the Date of 
Grant, and (c) the right to purchase the balance of the unvested 
shares shall first be vested on the third anniversary of the Date of 
Grant.  Notwithstanding the foregoing provisions of this section 2, if 
the Grantee's term as a Director of LHI terminates on account of his 
death, the Option shall be deemed vested as to all shares described in 
section 1 hereof as of the date of death.

3.      Exercise Period.  Except as otherwise provided in the Plan, 
the Option may be exercised from time to time with respect to all or 
any number of the then vested but unexercised shares on any regular 
business day of LHI at its then executive offices, until the earliest 
to occur of the following dates:

(a)     the tenth anniversary of the Date of Grant;

     (b) subject to  subsection  (c) next  below,  the date which is ninety (90)
days after the date the Grantee's term as a Director of LHI  terminates,  except
that such date shall be the date which is twelve (12) months after the Grantee's
death,  if death occurs while the Grantee is a Director of LHI or within  ninety
(90) days  thereafter;  provided  however,  if the term of a  director  does not
continue  due to the  terms of any plan or  arrangement  involving  any  merger,
consolidation  or other event  specified in Section 6.8, 6.9 or 6.10 of the Plan
or if the  director  is not  elected  to  continue  in office  for  three  years
following  such an event or is removed  without  cause from such  office  within
three years  following such an event,  then all options that are  exercisable at
the time of such event or that  become  exercisable  due to such event shall not
expire until the earlier of (a) twelve months following the date of death of the
director or (b) the end of the  original  term of the option  regardless  of the
date of termination of an Option holder's term as a Director.


provided, however, that if the Option is exercised after the 
Grantee's term as a Director has terminated for any reason, 
it may be exercised only to the extent vested on the date 
such term as a Director terminated.


4.      Exercise.  

(a)     During the period that the Option is 
exercisable, it may be exercised in full or in part by 
the Grantee or his guardian, assignee or legal 
representative, and, in the event of the Grantee's 
death, by the person or persons to whom the Option was 
transferred by assignment, will or the laws of descent 
and distribution, by delivering or mailing written 
notice of the exercise to the Secretary of LHI.  The 
written notice shall be signed by the person entitled 
to exercise the Option and shall specify the address 
and Social Security number of such person.  If any 
person other than the Grantee purports to be entitled 
to exercise all or any portion of the Option, the 
written notice shall be accompanied by proof, 
satisfactory to the Secretary of LHI, of that 
entitlement.

(b)     Subject to the provisions of subsection (c) 
hereof, the written notice shall be accompanied by full 
payment of the exercise price for the shares as to 
which the Option is exercised either (i) in cash or 
cash equivalents, (ii) in shares of LHI common stock 
evidenced by certificates either endorsed or with stock 
powers attached transferring ownership to LHI, with an 
aggregate Fair Market Value (as defined in the Plan) 
equal to said exercise price on the date the written 
notice is received by the Secretary, or (iii) in any 
combination of cash or cash equivalents and such 
shares; provided that any shares of LHI common stock 
tendered in payment of all or any part of the exercise 
price must, if they are shares acquired by the Grantee 
through an exercise of the Option, have been owned for 
more than six (6) months prior to the subject Option 

exercise.

(c)     In lieu of payment of the exercise price by 
way of delivery of certificate(s) evidencing shares of 
LHI common stock, the Grantee may furnish a notarized 
statement reciting the number of shares being purchased 
under the Option and the number of LHI shares owned by 
the Grantee which could be freely delivered as payment; 
provided that if the certificate refers to any shares 
acquired through an exercise of the Option, then such 
shares must have been owned for more than six (6) 
months prior to the subject Option exercise in order to 
be considered eligible to be freely delivered as 
payment.  If the Grantee furnishes such a statement in 
payment of the exercise price, he will be issued a 
certificate for new shares representing the number of 
shares as to which the Option is exercised, less the 
number of shares described in the notarized statement 
as constituting payment under the Option.

(d)     In the event the Grantee pays the Option 
exercise price by delivery of a notarized statement of 
ownership, as described in subsection (c) next above, 
the number of shares remaining subject to the Option 
shall be reduced not only by the number of new shares 
issued upon exercise of the Option but also by the 
number of previously owned shares listed on the 
notarized statement of ownership and deemed to be 
surrendered as payment of the exercise price.

(e)     The written notice of exercise will be 
effective and the Option shall be deemed exercised to 
the extent specified in the notice on the date that the 
written notice (together with required accompaniments 
respecting payment of the exercise price) is received 
by the Secretary of LHI at its then executive offices 
during regular business hours.

5.      Transfer of Shares; Tax Withholding.  As soon as 
practicable after receipt of an effective written notice of 
exercise and full payment of the exercise price as provided 
in section 4 above, the Secretary of LHI shall cause 
ownership of the appropriate number of shares of LHI common 
stock to be transferred to the person or persons exercising 
the Option by having a certificate or certificates for such 
number of shares registered in the name of such person or 
persons and shall have each certificate delivered to the 
appropriate person.  Each such certificate shall bear a 
legend describing the restrictions imposed by securities 
laws, as described in section 7 below, to the extent 
applicable.  Notwithstanding the foregoing, if LHI or a 
Subsidiary requires reimbursement of any tax required by law 
to be withheld with respect to shares of LHI common stock, 
the Secretary shall not transfer ownership of shares until 
the required payment is made; provided that in lieu of 
payment in cash of the taxes required by law to be withheld, 
the Grantee may pay such taxes by surrendering his right to 
exercise a portion of the Option equal in value to the 


amount of said taxes; the Grantee would then receive a 
certificate for the number of shares otherwise issuable 
pursuant to the Grantee's exercise of the Option, reduced by 
a number of shares with an aggregate Fair Market Value equal 
to the amount of said taxes, which latter number of shares 
would be deemed purchased pursuant to the exercise of the 
Option and, thus, no longer available under the Plan.

6.      Binding Effect.  The terms of this Option shall be 
binding upon the executors, administrators, heirs, 
successors, and assigns of the Grantee.

7.      Requirements of Law.  This Option may not be 
exercised if the issuance of shares of LHI common stock upon 
such exercise would constitute a violation of any applicable 
federal or state securities or other law or valid 
regulation.  The Grantee, as a condition to his exercise of 
this Option, shall represent to LHI that the shares of LHI 
common stock to be acquired by exercise of this Option are 
being acquired for investment and not with a present view to 
distribution or resale, unless counsel for LHI is then of 
the opinion that such a representation is not required under 
the Securities Act of 1933 or any other applicable law, 
regulation, or rule of any governmental agency.

IN WITNESS WHEREOF, LHI, by its duly authorized 
officer, and the Grantee have signed this Agreement as of 
the date first above written.

LAB HOLDINGS, INC.

By:___________________________

______________________________
Grantee

The Grantee acknowledges receipt of copies of the Plan 
and the Prospectus, dated ________________________, 
respecting the Plan.  The Grantee represents that (s)he is 
familiar with the terms and provisions of the Plan and such 
Prospectus.  The Grantee hereby accepts this Option subject 
to all the terms and provisions of the Plan, including but 
not limited to Section 6 ("Terms and Conditions") and 
Section 7 ("Adjustments in Event of Changes in 
Capitalization") thereof.  The Grantee hereby agrees to 
accept as binding, conclusive, and final all decisions and 
interpretations of the Board of Directors respecting any 
questions arising under the Plan.


Date: ________________                          


Grantee