Stock Option Plan for Nonemployee Directors - Storage Technology Corp.


                         STORAGE TECHNOLOGY CORPORATION
                     AMENDED AND RESTATED STOCK OPTION PLAN
                           FOR NONEMPLOYEE DIRECTORS


                                    RECITALS

      A.    Pursuant to a resolution dated June 15, 1987, the board of
directors (the 'Board') of Storage Technology Corporation, a Delaware
corporation (the 'Company'), adopted the Stock Option Plan for NonEmployee
Directors (the 'Plan').  The Plan was approved by the stockholders of the
Company at a meeting held October 20, 1987 (the 'Original Adoption Date').  The
Plan was thereafter amended (the 'First Amendment') by the Board on March 29,
1989 and such amendment was approved by the stockholders of the Company at a
meeting held June 28, 1989, and again amended (the 'Second Amendment') by the
Board on November 7, 1990 and such amendment was approved by the stockholders
of the Company at a meeting held May 29, 1991.  This Amended and Restated Plan
incorporates the above amendments, and amendments approved by the Board on July
26, 1995 and March 6, 1996.

      B.    The Board reserved the right to amend the Plan from time to time
with certain restrictions and only with the approval of the stockholders with
respect to certain amendments, all as specified in the Plan.  Pursuant to such
authority, the Plan is hereby amended in its entirety as set forth below (the
'Amended Plan'), provided, however, that the amendments made hereby and options
first granted hereby, pursuant to Section 3.2.1.6, are all subject to the
approval of the Company's stockholders at the Company's next annual meeting
following the Board's adoption of this Amended Plan.

      C.    The purposes of the Plan are to secure for the Company the benefits
arising from capital stock ownership by its current and future nonemployee
directors by providing to such directors added incentive to continue in the
service of the Company and a more direct interest in the future success of the
operations of the Company through the granting to such directors of options
('Option' or 'Options') to purchase shares of the $.10 par value common stock
of the Company (the 'Stock') subject to the terms and conditions described
below.


                                   ARTICLE I

1    GENERAL

     1.1    Definitions.  For purposes of this Amended Plan, and as used
            herein, a 'nonemployee director' is an individual who (a) is a
            member of the board of directors of the Company, and (b) is not an
            employee of the Company.  For purposes of this Amended Plan, an
            employee is an individual whose wages are subject to the
            withholding of federal income tax under section 3401 of the
            Internal Revenue Code of 1986, as amended from time to time (the
            'Code').









     1.2    Options.  The Options granted hereunder shall be options that are
            not qualified as incentive stock options under section 422A of the
            Code.

                                   ARTICLE II

2    ADMINISTRATION

     2.1    The Stock Option Committee.  The Amended Plan shall be administered
            by the Compensation Committee of the Board ('the Committee'), which
            shall be composed in such a manner to satisfy the requirements, if
            any, of Rule 16b-3 promulgated under the Securities Exchange Act of
            1934 or any successor rule ('Rule 16b-3') with respect to
            committees administering formula plans that comply with Rule 16b-3
            and in accordance with the General Corporation Law of Delaware.
            The persons comprising the Committee shall be appointed by and
            serve at the pleasure of the Board.  The Committee members shall
            all be members of the Board.

     2.2    Quorum.  A majority of the Committee shall constitute a quorum, and
            the acts of a majority of the members present at any meeting at
            which a quorum is present or participating by the means described
            in the last sentence of this section 2.2, or acts approved in
            writing by all members of the Committee, shall be the acts of the
            Committee.  The Committee shall keep minutes of its meetings.  One
            or more members of the Committee may participate in a meeting of
            the Committee by means of conference telephone or similar
            communications equipment by means of which all persons
            participating in the meeting can hear each other.

     2.3    Authority of the Committee.  The Committee shall have no authority
            or discretion or power to select the participants who will receive
            Options, to set the number of shares to be covered by each Option,
            or to set the exercise price or the period within which the Options
            may be exercised or to alter any other terms or conditions
            specified herein, except in the sense of administering the Amended
            Plan subject to the provisions of the Amended Plan.  Subject to the
            foregoing limitations, the Committee shall have authority and power
            to adopt such rules and regulations and to take such action as it
            shall consider necessary or advisable for the administration of the
            Amended Plan and to construe, interpret and administer the Amended
            Plan and the decisions of the Committee shall be final and binding
            upon the Company, the Holders (as defined below) and all other
            persons.  No member of the Committee shall incur any liability by
            reason of any action or determination made in good faith with
            respect to the Amended Plan or any stock option agreement.





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                                  ARTICLE III

3    OPTIONS

     3.1    Participation.  Each individual who was a nonemployee director of
            the Company on the Original Adoption Date or who becomes such
            thereafter shall receive Options to purchase Stock under the Plan
            on the terms and conditions described herein.

     3.2    Stock Option Agreements.  Each Option granted under the Amended
            Plan shall be evidenced by a written stock option agreement in
            substantially the form attached hereto, which shall be entered into
            by the Company and the nonemployee director to whom the Options
            are granted (the 'Holder'), and which shall include or conform to
            the following terms and conditions, and which may include such
            other terms and conditions, if any, not inconsistent therewith or
            with the terms and conditions of this Amended Plan as the Committee
            considers appropriate:

            3.2.1   Number of Options and Grant Dates.  Each nonemployee
                    director is entitled to receive, under the Plan, Options to
                    purchase shares of Stock as described below and subject to
                    adjustment from and after the Original Adoption Date as
                    provided in section 4.2 hereof.

                    3.2.1.1    Each nonemployee director who was such on
                               October 20, 1987, has received an Option,
                               granted as of October 20, 1987, to purchase
                               2,500 shares of Stock (after adjustment for the
                               one-for-ten reverse stock split effected on May
                               19, 1989) pursuant to the Plan.

                    3.2.1.2    Each individual who became a nonemployee
                               director of the Company after March 29, 1989,
                               and prior to November 7, 1990, has received an
                               Option, granted as of his or her election date,
                               to purchase 2,500 shares of Stock pursuant to
                               the First Amendment.

                    3.2.1.3    Between October 20, 1987 and November 7, 1990,
                               each nonemployee director holding an Option
                               granted under 3.2.1.1 or 3.2.1.2 above who had,
                               after such grant, been elected to serve on the
                               Board at two consecutive annual meetings of
                               stockholders as a nonemployee director after
                               receipt of the Option granted under 3.2.1.1 or
                               3.2.1.2 above, has received an additional
                               Option, granted as of such election date, to
                               purchase 2,500 shares of Stock.

                    3.2.1.4    Options granted under 3.2.1.1, 3.2.1.2 and
                               3.2.1.3 above will hereinafter be collectively
                               referred to as 'Initial Options'.  All Initial
                               Options shall continue to be held pursuant to
                               the terms and conditions of this Amended Plan.






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                    3.2.1.5    Each nonemployee director who was such on
                               November 7, 1990, or who first becomes such
                               after November 7, 1990, shall receive an Option
                               (the 'New Option'), granted as of the later to
                               occur of November 7, 1990, or his or her first
                               election or appointment as a nonemployee
                               director, to purchase a number of shares of
                               Stock equal to 25,000 less any shares subject to
                               the Initial Options granted to such director.

                    3.2.1.6    Each nonemployee director who was such on July
                               26, 1995  or is thereafter elected or appointed
                               shall receive an additional option (the
                               'Additional Option') granted as of the later to
                               occur of July 26, 1995 or the third anniversary
                               of his or her first election or appointment as a
                               nonemployee director, to purchase 18,000 shares
                               of Stock.

                    3.2.1.7    In the event that any grant hereunder would
                               exceed the number of shares of Stock available
                               for issuance under the Amended Plan, or is
                               otherwise subject to stockholder approval, then
                               each such grant shall be conditioned on and
                               subject to subsequent stockholder approval to
                               the extent it exceeds that number of shares
                               determined by dividing the total number of
                               shares remaining available for grant under the
                               Amended Plan on such grant date by the number of
                               eligible nonemployee directors, or to the
                               extent that stockholder approval is otherwise
                               required.

            3.2.2   Price.  The price at which each share of Stock covered by
                    an Option may be purchased shall be the greater of 100
                    percent of the fair market value of such share on the date
                    of grant of the Option or the par value per share.  For
                    purposes of this determination, 'fair market value' means
                    the closing price of a share of Stock as reported in the
                    Wall Street Journal for the last business day prior to the
                    date of the grant.  If no such closing price is reported,
                    then fair market value shall mean the average of the high
                    and low sale prices (or if no sale prices are reported, the
                    average of the high and low bid prices) as reported by the
                    principal regional stock exchange, or if not so reported,
                    as reported by NASDAQ or a quotation system of general
                    circulation to brokers and dealers.

            3.2.3   Service Required for Exercise.

                    3.2.3.1    Each Initial Option shall be exercisable in full
                               six months after the date of grant, or at any
                               time after November 7, 1990, whichever shall
                               occur last.

                    3.2.3.2    Subject to 3.2.3.5 below, for each nonemployee
                               director who is such on November 7, 1990, such
                               director's New Option shall become exercisable
                               as follows:  a number of shares equal to 5,000
                               less any shares subject to Initial Options
                               granted to such director, shall become
                               exercisable six months after the grant date, and
                               the balance shall become exercisable in






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                               four equal amounts on the first through fourth 
                               anniversaries of such grant date.

                    3.2.3.3    Subject to 3.2.3.5 below, for each nonemployee
                               director who becomes such after November 7,
                               1990, such director's New Option shall become
                               exercisable as follows:  5,000 shares shall
                               become exercisable six months after the grant
                               date and the balance shall become exercisable in
                               six equal amounts on the first through the sixth
                               anniversaries of such grant date (with the first
                               four years rounded down to the nearest whole
                               share, and the last two years rounded up).

                    3.2.3.4    Subject to 3.2.3.5 below, each Additional Option
                               shall become exercisable as follows: 6,000
                               shares on each of the first, second, and third
                               anniversaries of the first date by which all
                               shares that are subject to New Options held by
                               such directors have become exercisable.

                    3.2.3.5    Except as set forth in this Article III, the
                               Options shall not be exercisable as to any
                               shares as to which the continuous service
                               requirement shall not be satisfied, regardless
                               of the circumstances under which the Holder's
                               service to the Company shall be terminated.  The
                               number of shares as to which an Option may be
                               exercised shall be cumulative, so that once an
                               Option shall become exercisable as to any shares
                               it shall continue to be exercisable as to such
                               shares, until expiration or termination of the
                               Options as provided in the Amended Plan.

            3.2.4   Option Period.  The period within which each Option may be
                    exercised shall expire, in all cases, ten years from the
                    date of grant of the Option (the 'Option Period'), unless
                    terminated sooner pursuant to subsection 3.2.5 below or
                    fully exercised prior to the end of such period.

            3.2.5   Termination of Service. With respect to the exercise of
                    such Option in the event that the Holder ceases to be a
                    nonemployee director of the Company for the reasons
                    described in this 3.2.5:

                    3.2.5.1    As to all options granted before July 20, 1995,
                               and as to options granted on or after July 20,
                               1995, if the option has not been outstanding, as
                               of the date of the director ceasing to be a
                               nonemployee director, for at least six years and
                               such director has not been an outside director
                               for at least ten years, the vesting of and
                               expiration of the right to exercise such options
                               shall occur as follows:

                               3.2.5.1.1    Disability.  If the Holder
                                            terminates his or her service as a
                                            director due to becoming disabled
                                            (within the meaning of section
                                            22(e)(3) of the Code) while in a
                                            directorship of the






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                                            Company or becomes disabled during 
                                            the six-month period after his or 
                                            her termination, Options vested as 
                                            of the date of termination may be
                                            exercised within twelve months
                                            following the disability (if
                                            otherwise within the Option Period)
                                            but will expire at the end of such
                                            period to the extent they are not
                                            exercised; or

                               3.2.5.1.2    Death.  If the Holder shall die
                                            while in a directorship of the
                                            Company or during the six-month
                                            period after his or her termination
                                            of service as a director, all
                                            Options, including, but not limited
                                            to, Options not otherwise vested
                                            may be exercised within twelve
                                            months following such death (if
                                            otherwise within the Option
                                            Period), but not thereafter, by the
                                            Holder's legal representative or
                                            representatives, or by the person
                                            or persons entitled to do so under
                                            the Holder's last will and
                                            testament, or if the Holder shall
                                            fail to make testamentary
                                            disposition of his or her Options
                                            or shall die intestate, by the
                                            person or persons entitled to
                                            receive said Options under the laws
                                            of descent and distribution; or

                               3.2.5.1.3    Other.  If the directorship of a
                                            Holder is terminated for any reason
                                            prior to such director reaching age
                                            70 (other than the circumstances
                                            specified in 3.2.5.1.1 and
                                            3.2.5.1.2 of this 3.2.5.1) within
                                            the Option Period, the Options
                                            vested as of the date of
                                            termination may be exercised within
                                            six months following the date of
                                            such termination (if otherwise
                                            within the Option Period), but not
                                            thereafter, or

                               3.2.5.1.4    Retirement.  If the directorship of
                                            a Holder is terminated for any
                                            reason after such director reaches
                                            age 70 (other than the
                                            circumstances specified in
                                            3.2.5.1.1 and 3.2.5.1.2) within the
                                            Option Period, all Options,
                                            including, but not limited to,
                                            Options not otherwise vested may be
                                            exercised within six months
                                            following the date of such
                                            termination (if otherwise within
                                            the Option Period), but not
                                            thereafter.

                    3.2.5.2    As to all Options granted on or after July 20,
                               1995, if the Option has been  outstanding, as of
                               the date of the director's ceasing to be a
                               nonemployee director, for at least six years or
                               such director has been an outside director for
                               at least ten years, the vesting of and
                               expiration of the right to exercise such options
                               shall occur as follows:

                               3.2.5.2.1    Disability.  If the Holder
                                            terminates his or her service as a
                                            director due to becoming disabled
                                            (within the meaning of






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                                            section 22(e)(3) of the Code) while
                                            in a directorship of the Company,
                                            Options vested as of the date of
                                            termination may be exercised within
                                            the Option Period but will expire
                                            at the end of such period to the
                                            extent they are not exercised; or

                               3.2.5.2.2    Death.  If the Holder shall die
                                            while in a directorship of the
                                            Company all Options, including, but
                                            not limited to, Options not
                                            otherwise vested may be exercised
                                            within the Option Period but not
                                            thereafter, by the Holder's legal
                                            representative or representatives,
                                            or by the person or persons
                                            entitled to do so under the
                                            Holder's last will and testament,
                                            or if the Holder shall fail to make
                                            testamentary disposition of his or
                                            her Options or shall die intestate,
                                            by the person or persons entitled
                                            to receive said Options under the
                                            laws of descent and distribution;
                                            or

                               3.2.5.2.3    Other.  If the directorship of the
                                            Holder is terminated for any reason
                                            prior to such director reaching age
                                            70 (other than the circumstances
                                            specified in 3.2.5.2.1 and
                                            3.2.5.2.2 of this 3.2.5.2) within
                                            the Option Period, the Options
                                            vested as of the date of
                                            termination may be exercised within
                                            the Option Period, but not
                                            thereafter; or

                               3.2.5.2.4    Retirement.  If the directorship of
                                            the Holder is terminated for any
                                            reason after such director reaches
                                            age 70 (other than the
                                            circumstances specified in
                                            3.2.5.2.1 and 3.2.5.2.2) within the
                                            Option Period, all Options,
                                            including, but not limited to,
                                            Options not otherwise vested may be
                                            exercised within the Option Period,
                                            but not thereafter.

            3.2.6   Transferability.  Each Option granted under the Plan or the
                    Amended Plan shall not be transferable by the Holder except
                    (i) by will or pursuant to the laws of descent and
                    distribution, or (ii) pursuant to a qualified domestic
                    relations order as defined by the Code or Title I of the
                    Employee Retirement Income Security Act, or the rules
                    thereunder, or (iii) as may otherwise be permitted by
                    applicable law, including the version of Rule 16b-3 that is
                    applicable to this Amended Plan at the time of the
                    transfer.  Each Option shall be exercisable during the
                    Holder's lifetime only by the Holder or by his or her
                    permitted transferee(s) pursuant to clause (ii) or (iii)
                    hereof.

            3.2.7   Exercise of Option.  The method for exercising each Option
                    granted pursuant to the Plan or the Amended Plan shall be
                    by delivery to the Company of written notice specifying the
                    number of shares with respect to which the Options are
                    being exercised.  If requested by the Company, such notice
                    shall contain the Holder's






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                    representation that he or she is purchasing the Stock for
                    investment purposes only and his or her agreement not to
                    sell any Stock so purchased in any manner that is in
                    violation of the Securities Act of 1933, as amended, or
                    applicable state law.  Such restrictions, or notice
                    thereof, shall be placed on the certificates representing
                    the Stock so purchased.  The purchase of such Stock shall
                    take place at the principal offices of the Company within
                    twenty days following delivery of such notice, at which
                    time the purchase price of the Stock shall be paid in full
                    in cash, by check payable to the Company's order, by
                    delivery to the Company of certificates representing the
                    number of shares of Stock then owned by the exercising
                    Holder, the fair market value of which, on the date of
                    exercise, equals the purchase price of the Stock purchased
                    pursuant to exercise of the Options, properly endorsed for
                    transfer to the Company, or by a combination of such
                    methods of payment.  A properly executed certificate or
                    certificates representing the Stock shall be delivered to
                    the Holder upon payment therefor.


                                   ARTICLE IV

4    AUTHORIZED STOCK

     4.1    The Stock.  The total number of shares of Stock as to which Options
            may be granted pursuant to the Amended Plan shall not exceed
            530,000 in the aggregate, except as such number of shares shall be
            adjusted from and after July 26, 1995 in accordance with the
            provisions of 4.2 hereof.  If any outstanding Option granted under
            the Plan or the Amended Plan shall expire or be terminated for any
            reason before the end of the Option Period, the shares of Stock
            allocable to the unexercised portion of such Option shall be
            available for grants pursuant to 3.2.1.5 and 3.2.1.6 above.
            Fractional shares shall not be distributed and shall remain
            unallocated.  The Company shall at all times during the life of any
            outstanding Options retain as authorized and unissued shares or
            treasury shares at least the number of shares from time to time
            included in the outstanding Options, or otherwise assure itself of
            its ability to perform its obligations under the Amended Plan.

     4.2    Adjustment by Stock Split, Stock Dividend, Etc.  In the event that
            the outstanding shares of Stock of the Company are changed into or
            exchanged for a different number or kind of shares or other
            securities of the Company by reason of any recapitalization,
            reclassification, stock split, reverse stock split, stock dividend,
            combination or subdivision, appropriate adjustment shall be made in
            the number and kind of shares available for grant under the Amended
            Plan and reserved for issuance under any Options granted under the
            Plan or the Amended Plan.  Such adjustment to outstanding Options
            shall be made without change in the total price applicable to the
            unexercised portion of such Options, and a corresponding adjustment
            in the applicable exercise price per share shall be made.






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     4.3    Rights as a Stockholder.  The holder of an Option shall have no
            rights as a stockholder with respect to any shares covered by an
            Option until the date of issue of a stock certificate to him or her
            for such shares.  Except as otherwise expressly provided in the
            Amended Plan, no adjustment shall be made for dividends or other
            rights for which the record date is prior to the date such stock
            certificate is issued.

     4.4    General Adjustment Rules.  No adjustment or substitution provided
            for in this Article IV shall require the Company to sell a
            fractional share under any stock option agreement and the total
            substitution or adjustment with respect to each stock option
            agreement shall be limited by deleting any fractional share.  In
            the case of any such substitution or adjustment, the exercise price
            per share in each such stock option agreement shall be equitably
            adjusted by the Committee to reflect the greater or lesser number
            of shares of Stock or other securities into which the Stock subject
            to an Option may have been changed.  Adjustments under this Article
            IV shall be made by the Committee, whose determination with regard
            thereto shall be final and binding.


                                   ARTICLE V

5    REORGANIZATION OR LIQUIDATION

     In case the Company is merged or consolidated with another entity and the
     stockholders of the Company as of immediately prior to such merger or
     consolidation own 50% or less of the voting power of the surviving entity,
     or in case all or substantially all of the assets or more than 50% of the
     outstanding voting stock of the Company is acquired by any other person or
     entity, or in case of a reorganization (other than a reorganization under
     federal bankruptcy statutes) or liquidation of the Company that is
     approved by the stockholders of the Company (i) any outstanding Options
     shall be assumed or substituted on an equitable basis by the merged,
     consolidated or otherwise reorganized corporation, person or entity,
     provided that no additional benefits shall be conferred upon the Holders
     as a result of such assumption or substitution, and the excess of the
     aggregate fair market value of the shares subject to the Options
     immediately after such assumption or substitution over the purchase price
     thereof is not more than the excess of the aggregate fair market value of
     the shares subject to the Options immediately before such assumption or
     substitution over the purchase price thereof, and (ii) the exercisability
     of all outstanding Options shall automatically be accelerated such that
     the Options shall become exercisable in full regardless of whether all
     conditions of exercise relating to vesting period or length of service of
     a director have been satisfied.  In the event that the triggering event is
     an event that requires approval of the stockholders of the Company prior
     to its consummation, then the acceleration of exercisability shall be
     effective upon stockholder approval of such triggering event.  If the
     triggering event does not require stockholder approval (such as the
     acquisition by a third party of more than 50% of the outstanding stock of
     the Company), then the acceleration of exercisability shall be effective
     upon the occurrence of such event.






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                                   ARTICLE VI

6    GENERAL PROVISIONS

     6.1    Expiration.  The Amended Plan shall terminate whenever the Board
            adopts a resolution to that effect.  If not sooner terminated under
            the preceding sentence, the Amended Plan shall wholly cease and
            expire on March 29, 2010.  After termination, no Option shall be
            granted under this Amended Plan, but the Company shall continue to
            recognize Options previously granted.

     6.2    Amendments.  The Board may from time to time amend, modify, suspend
            or terminate the Amended Plan; provided, however, that the
            provisions of the Amended Plan that determine which directors may
            be granted Options, the timing of the Option grants and the number
            of shares of Stock subject to Options granted hereunder may not be
            amended more frequently than is permitted for formula plans by Rule
            16b-3.  Nevertheless, no such amendment, modification, suspension
            or termination shall (a) impair any Option earlier granted under
            the Plan or the Amended Plan or deprive any Holder of any shares of
            Stock that he or she may have acquired through or as a result of
            the Plan or the Amended Plan or (b) be made without the approval of
            the stockholders of the Company if such approval is required to
            retain the exemption provided by Rule 16b-3 with respect to Options
            granted under the Plan or the Amended Plan.

     6.3    Treatment of Proceeds.  Proceeds from the sale of Stock pursuant to
            Options granted under the Plan or the Amended Plan shall constitute
            general funds of the Company.

     6.4    Effectiveness.  The effective date of the Plan was October 20,
            1987.  The 'Effective Date' of this Amended Plan shall be July 26,
            1995.

     6.5    Paragraph Headings.  The paragraph headings are included herein
            only for convenience, and they shall have no effect on the
            interpretation of the Plan.

     ADOPTED by the authority of the Board on March 6, 1996, effective as of
the Effective Date of the Amended Plan.

                                                STORAGE TECHNOLOGY CORPORATION






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