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Proc-Type: 2001,MIC-CLEAR
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<SEC-DOCUMENT>0000087050-01-500007.txt : 20010619
<SEC-HEADER>0000087050-01-500007.hdr.sgml : 20010619
ACCESSION NUMBER:		0000087050-01-500007
CONFORMED SUBMISSION TYPE:	S-8
PUBLIC DOCUMENT COUNT:		7
FILED AS OF DATE:		20010618
EFFECTIVENESS DATE:		20010618

FILER:

	COMPANY DATA:	
		COMPANY CONFORMED NAME:			SBE INC
		CENTRAL INDEX KEY:			0000087050
		STANDARD INDUSTRIAL CLASSIFICATION:	COMPUTER COMMUNICATIONS EQUIPMENT [3576]
		IRS NUMBER:				941517641
		STATE OF INCORPORATION:			DE
		FISCAL YEAR END:			1031

	FILING VALUES:
		FORM TYPE:		S-8
		SEC ACT:		
		SEC FILE NUMBER:	333-63228
		FILM NUMBER:		1662504

	BUSINESS ADDRESS:	
		STREET 1:		4550 NORRIS CANYON ROAD
		CITY:			SAN RAMON
		STATE:			CA
		ZIP:			94583
		BUSINESS PHONE:		5103552000

	MAIL ADDRESS:	
		STREET 1:		4550 NORRIS CANYON RD
		CITY:			SAN RAMON
		STATE:			CA
		ZIP:			94583
</SEC-HEADER>
<DOCUMENT>
<TYPE>S-8
<SEQUENCE>1
<FILENAME>sbe_s861801.txt
<TEXT>


       As filed with the Securities and Exchange Commission on June 18, 2001
                           Registration No. 333-______
================================================================================

                       SECURITIES AND EXCHANGE COMMISSION
                             Washington, D.C. 20549
                             ----------------------

                                    FORM S-8
                             REGISTRATION STATEMENT
                                      UNDER
                           THE SECURITIES ACT OF 1933
                             ----------------------

                                    SBE, INC.
             (Exact name of registrant as specified in its charter)
                             ----------------------

            Delaware                                   94-1517641
     -----------------------           ------------------------------------
     (State of Incorporation)          (I.R.S. Employer Identification No.)


                             4550 NORRIS CANYON ROAD
                               SAN RAMON, CA 94583
                    (Address of principal executive offices)


                             1996 STOCK OPTION PLAN
                       1998 NON-OFFICER STOCK OPTION PLAN
                            (Full title of the plans)


                                 TIMOTHY J. REPP
                             CHIEF FINANCIAL OFFICER
                                    SBE, INC.
                             4550 NORRIS CANYON ROAD
                               SAN RAMON, CA 94583
                                 (925) 355-2000
  (Name, address, including zip code, and telephone number, including area code,
                              of agent for service)
                             ----------------------

                                   Copies to:
                          Christopher A. Westover, Esq.
                               Cooley Godward LLP
                         One Maritime Plaza, 20th Floor
                             San Francisco, CA 94111
                                 (415) 693-2000


                                        1
<PAGE>
<TABLE>
<CAPTION>


                                   CALCULATION OF REGISTRATION FEE
====================================================================================================

    TITLE OF                                PROPOSED MAXIMUM    PROPOSED MAXIMUM
SECURITIES TO BE           AMOUNT TO BE      OFFERING PRICE        AGGREGATE           AMOUNT OF
   REGISTERED              REGISTERED (1)     PER SHARE (2)    OFFERING PRICE (2)   REGISTRATION FEE
- ------------------------   -------------    ----------------   -----------------    ----------------
<S>                        <C>              <C>                <C>                  <C>
Stock Options and Common   300,000 shares   $           2.61   $         783,000    $         206.71
Stock (par value $.001)
====================================================================================================
<FN>

(1)  This  registration  statement  is  intended  to cover the offering of up to
     150,000  shares of the Registrant's Common Stock pursuant to its 1996 Stock
     Option  Plan,  as  amended  (the  "Plan")  and  up to 150,000 shares of the
     Registrant's  Common  Stock  pursuant  to its 1998 Non-Officer Stock Option
     Plan,  as  amended  (the  "Non-Officer  Plan"). This registration statement
     shall  also  cover  any  additional  shares  of  Common  Stock which become
     issuable  under  the  Plan  or  Non-Officer  Plan  by  reason  of any stock
     dividend,  stock  split,  recapitalization or any other similar transaction
     without receipt of consideration which results in an increase in the number
     of  shares  of  the  Registrant's  outstanding  Common  Stock.

(2)  Estimated  solely  for  the  purpose  of  calculating  the  amount  of  the
     registration  fee pursuant to Rule 457(h) under the Securities Act of 1933,
     as  amended  (the  "Act"). The price per share and aggregate offering price
     are  based  upon  the  average  of  the high and low prices of Registrant's
     Common  Stock  on  June 15, 2001 as reported on the Nasdaq National Market.
</TABLE>

                                        2
<PAGE>
                    INCORPORATION BY REFERENCE OF CONTENTS OF
    REGISTRATION STATEMENT ON FORM S-8 NOS. 33-45998, POS 33-45998, 333-63377,
                       333-65767, 333-32896 AND 333-43532.

     The  contents  of  Registration  Statements  on Form S-8 Nos. 33-45998, POS
33-45998,  333-63377,  333-65767,  333-32896  and  333-43532  filed  with  the
Securities  and  Exchange  Commission  on  February  26,  1992, August 19, 1998,
September  15,  1998,  October  16,  1998,  March  21, 2000 and August 11, 2000,
respectively,  are  incorporated  by  reference  herein.

                                    EXHIBITS

EXHIBIT
NUMBER
======
5.1      Opinion  of  Cooley  Godward  LLP.

23.1     Consent  of  PricewaterhouseCoopers  LLP,  Independent  Auditors.

23.2     Consent  of  Cooley  Godward  LLP  is  contained in Exhibit 5.1 to this
         Registration  Statement.

24.1     Power  of  Attorney  is  contained  on  the  signature  pages.

99.1     1996  Stock  Option  Plan,  as  amended  through  January  8,  2001.

99.2     1998  Non-Officer  Stock  Option Plan, as amended through May 22, 2001.

99.3     Form  of  Incentive  and  Nonstatutory  Stock Option Agreements used in
         connection  with  the  1996  Stock  Option  Plan.

99.4     Form of Stock Option Agreement and Grant Notice used in connection with
         the  1998  Non-Officer  Stock  Option  Plan.

                                        3
<PAGE>
                                   SIGNATURES

     Pursuant to the requirements of the Securities Act of 1933, as amended, the
Registrant certifies that it has reasonable grounds to believe that it meets all
of the requirements for filing on Form S-8 and has duly caused this Registration
Statement  to  be  signed  on  its  behalf  by  the  undersigned, thereunto duly
authorized,  in  the  City  of San Ramon, State of California, on June 18, 2001.


                                   SBE,  INC.


                                   By:  /s/Timothy  J.  Repp
                                        ----------------------
                                         Timothy  J.  Repp

                                   Title:  Vice President, Finance, Chief
                                           Financial Officer and Secretary


                               POWER OF ATTORNEY
     KNOW  ALL  PERSONS  BY  THESE  PRESENTS,  that  each person whose signature
appears  below constitutes and appoints William B. Heye, Jr. and Timothy J. Repp
and  each  or  any  one of them, his true and lawful attorney-in-fact and agent,
with  full  power  of  substitution and resubstitution, for him and in his name,
place  and  stead,  in  any  and  all capacities, to sign any and all amendments
(including  post-effective  amendments)  to  this Registration Statement, and to
file  the  same,  with  all  exhibits thereto, and other documents in connection
therewith,  with  the  Securities  and  Exchange  Commission, granting unto said
attorneys-in-fact  and  agents, and each of them, full power and authority to do
and  perform  each and every act and thing requisite and necessary to be done in
connection  therewith, as fully to all intents and purposes as he might or could
do  in  person,  hereby ratifying and confirming all that said attorneys-in-fact
and  agents,  or  any  of  them,  or their or his substitutes or substitute, may
lawfully  do  or  cause  to  be  done  by  virtue  hereof.

     Pursuant  to  the  requirements  of the Securities Act of 1933, as amended,
this  Registration  Statement  has  been  signed by the following persons in the
capacities  and  on  the  dates  indicated.

          SIGNATURE                         TITLE                      DATE

 /s/  William  B.  Heye,  Jr.
- -----------------------------
William  B.  Heye,  Jr.           President, Chief Executive       June 18, 2001
                                  Officer and Director
                                  (Principal Executive Officer)

 /s/  Timothy  J.  Repp
- -----------------------
Timothy  J.  Repp                 Vice President, Finance, Chief   June 18, 2001
                                  Financial Officer and Secretary
                                  (Principal Financial and
                                   Accounting Officer)

 /s/  Raimon  L.  Conlisk
- -------------------------
Raimon  L.  Conlisk               Director                         June 18, 2001


 /s/  Ronald  J.  Ritchie
- -------------------------
Ronald  J.  Ritchie               Director                         June 18, 2001


 /s/  Randall  L-W.  Caudill
- ----------------------------
Randall  L-W.  Caudill            Director                         June 18, 2001

                                        4
<PAGE>


                                  EXHIBIT INDEX

EXHIBIT       DESCRIPTION                                                   PAGE

5.1           Opinion of Cooley Godward LLP.                                   6

23.1          Consent of PricewaterhouseCoopers LLP, Independent Auditors.     7

23.2          Consent of Cooley Godward LLP is contained in Exhibit 5.1
              to this Registration Statement.                                  6

24.1          Power of Attorney is contained on the signature page             4

99.1          1996 Stock Option Plan, as amended through January 8, 2001.      8

99.2          1998 Non-Officer Stock Option Plan, as amended through
              May 22, 2001.                                                   30

99.3          Form of Incentive and Nonstatutory Stock Option Agreements
              used in connection with the 1996 Stock Option Plan.             40

99.4          Form of Stock Option Agreement and Grant Notice used in
              connection with the 1998 Non-Officer Stock Option Plan.         44



                                        5
<PAGE>


</TEXT>
</DOCUMENT>
<DOCUMENT>
<TYPE>EX-5.1
<SEQUENCE>2
<FILENAME>cooley_consent.txt
<TEXT>




Exhibit  5.1

June  14,  2001
SBE,  INC.
4550  NORRIS  CANYON  ROAD
SAN  RAMON,  CA  94583

Ladies  and  Gentlemen:

You  have  requested  our  opinion with respect to certain matters in connection
with the filing by SBE, Inc. (the "Company") of a Registration Statement on Form
S-8  (the  "Registration Statement") with the Securities and Exchange Commission
covering  the  offering  of  up to 300,000 shares of the Company's Common Stock,
$.001  par  value,  (the  "Shares")  pursuant to its 1996 Stock Option Plan (the
"Stock  Option  Plan")  and  its  1998  Non-Officer  Stock  Option  Plan  (the
"Non-Officer  Plan"  and  together  with  the  Stock  Option Plan, the "Plans").

In connection with this opinion, we have examined the Registration Statement and
related Prospectuses, your Certificate of Incorporation and By-laws, as amended,
and such other documents, records, certificates, memoranda and other instruments
as  we  deem  necessary  as  a  basis  for  this  opinion.  We  have assumed the
genuineness  and authenticity of all documents submitted to us as originals, the
conformity  to originals of all documents submitted to us as copies thereof, and
the due execution and delivery of all documents where due execution and delivery
are  a  prerequisite  to  the  effectiveness  thereof.

On  the  basis  of the foregoing, and in reliance thereon, we are of the opinion
that  the  Shares,  when  sold  and  issued  in  accordance  with the Plans, the
Registration  Statement  and related Prospectuses, will be validly issued, fully
paid, and nonassessable (except as to shares issued pursuant to certain deferred
payment  arrangements,  which  will  be  fully  paid and nonassessable when such
deferred  payments  are  made  in  full).

We  consent  to  the  filing  of  this opinion as an exhibit to the Registration
Statement.

Very truly yours,

Cooley Godward LLP
By:/s/Christopher A. Westover
   ----------------------------
     Christopher A. Westover


                                        6
<PAGE>




</TEXT>
</DOCUMENT>
<DOCUMENT>
<TYPE>EX-23.1
<SEQUENCE>3
<FILENAME>pwe_consent.txt
<TEXT>

Exhibit  23.1  Consent  of  PricewaterhouseCoopers  LLP

                       CONSENT OF INDEPENDENT ACCOUNTANTS



We  hereby  consent  to  the  incorporation  by  reference  in this Registration
Statement  on  Form  S-8  of our report dated November 30, 2000, relating to the
consolidated  financial  statements  and  financial  statement  schedule,  which
appears  in  SBE, Inc. Annual report of Form 10-K for the year ended October 31,
2000.



/s/PricewaterhouseCoopers LLP

San  Jose,  California
June  8,  2001





                                        7
<PAGE>




</TEXT>
</DOCUMENT>
<DOCUMENT>
<TYPE>EX-99.1
<SEQUENCE>4
<FILENAME>stockplan1996.txt
<TEXT>




Exhibit  99.1

                                    SBE, INC.

                             1996 STOCK OPTION PLAN

                ADOPTED BY THE BOARD OF DIRECTORS JULY 21, 1987,
          AMENDED MARCH 23, 1993, AUGUST 23, 1994 AND JANUARY 17, 1995
            APPROVED BY SHAREHOLDERS MARCH 9, 1989 AND MARCH 21, 1995
                      AMENDED AND RESTATED JANUARY 18, 1996
                 APPROVED BY THE SHAREHOLDERS ON APRIL 16, 1996
                            AMENDED DECEMBER 9, 1997
                 APPROVED BY THE STOCKHOLDERS ON APRIL 14, 1998
                            AMENDED JANUARY 27, 1999
                 APPROVED BY THE STOCKHOLDERS ON MARCH 23, 1999
                             AMENDED JANUARY 8, 2001
                 APPROVED BY THE STOCKHOLDERS ON MARCH 20, 2001

1)   PURPOSES.

a)   The  purpose  of the Plan is to provide a means by which selected Employees
     and Directors of and Consultants to the Company, and its Affiliates, may be
     given  an  opportunity  to  purchase  stock  of  the  Company.

b)   The  Company, by means of the Plan, seeks to retain the services of persons
     who  are now Employees or Directors of or Consultants to the Company or its
     Affiliates,  to  secure and retain the services of new Employees, Directors
     and  Consultants,  and  to  provide  incentives  for  such persons to exert
     maximum  efforts  for  the  success  of  the  Company  and  its Affiliates.

c)   The  Company  intends  that the Options issued under the Plan shall, in the
     discretion  of  the  Board  or  any  Committee  to which responsibility for
     administration  of the Plan has been delegated pursuant to subsection 3(c),
     be  either  Incentive  Stock  Options  or  Nonstatutory  Stock Options. All
     Options  shall  be  separately  designated  Incentive  Stock  Options  or
     Nonstatutory Stock Options at the time of grant, and in such form as issued
     pursuant  to  Section 6, and a separate certificate or certificates will be
     issued  for  shares  purchased  on  exercise  of  each  type  of  Option.

2)   DEFINITIONS.

a)   "Affiliate" means any parent corporation or subsidiary corporation, whether
     now  or  hereafter  existing, as those terms are defined in Sections 424(e)
     and  (f)  respectively,  of  the  Code.

b)   "Board" means the Board of Directors of the Company.

c)   "Code" means the Internal Revenue Code of 1986, as amended.
                                        8
<PAGE>

d)   "Committee" means a Committee appointed by the Board in accordance with
     subsection 3(c) of the Plan.

e)   "Company" means SBE, Inc., a Delaware corporation.

f)   "Consultant" means any person, including an advisor, engaged by the Company
     or  an  Affiliate  to render consulting 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.

g)   "Continuous  Status  as an Employee, Director or Consultant" means that the
     service  of  an individual to the Company, whether as an Employee, Director
     or  Consultant,  is  not  interrupted or terminated. The Board, in its sole
     discretion,  may  determine  whether  Continuous  Status  as  an  Employee,
     Director  or Consultant shall be considered interrupted in the case of: (i)
     any  leave of absence approved by the Board, including sick leave, military
     leave,  or any other personal leave; or (ii) transfers between the Company,
     Affiliates  or  their  successors.

h)   "Covered Employee" means the chief executive officer and the four (4) other
     highest  compensated officers of the Company for whom total compensation is
     required  to  be  reported  to  stockholders  under  the  Exchange  Act, as
     determined  for  purposes  of  Section  162(m)  of  the  Code.

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

j)   "Disinterested  Person"  means a Director who either (i) was not during the
     one  year  prior  to  service  as  an  administrator of the Plan granted or
     awarded  equity  securities  pursuant  to the Plan or any other plan of the
     Company  or  any  affiliate  entitling  the participants therein to acquire
     equity  securities  of  the Company or any affiliate except as permitted by
     Rule 16b-3(c)(2)(i); or (ii) is otherwise considered to be a "disinterested
     person"  in  accordance  with  Rule 16b-3(c)(2)(i), or any other applicable
     rules,  regulations  or  interpretations  of  the  Securities  and Exchange
     Commission.

k)   "Employee"  means any person, including Officers and Directors, employed by
     the  Company or any Affiliate 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 the common stock of
     the Company 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 sales price for such stock
          (or  the  closing  bid,  if  no sales were reported) 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;
                                        9
<PAGE>

     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 bid and
          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)   "Nonstatutory Stock Option" means an Option not intended to qualify as an
     Incentive Stock Option.

p)   "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.

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

r)   "Option  Agreement"  means  a  written agreement between the Company and an
     Optionee evidencing the terms and conditions of an individual Option grant.
     Each  Option  Agreement shall be subject to the terms and conditions of the
     Plan.

s)   "Optionee" means a person who holds an outstanding Option.

t)   "Outside  Director"  means  a  Director  who  either  (i)  is not a current
     employee  of the Company or an "affiliated corporation" (within the meaning
     of  the Treasury regulations promulgated under Section 162(m) of the Code),
     is  not  a  former  employee  of the Company or an "affiliated corporation"
     receiving  compensation for prior services (other than benefits under a tax
     qualified  pension  plan),  was  not  an  officer  of  the  Company  or  an
     "affiliated corporation" at any time, and is not currently receiving direct
     or  indirect  remuneration  from the Company or an "affiliated corporation"
     for services in any capacity other than as a Director, or (ii) is otherwise
     considered  an  "outside  director"  for  purposes of Section 162(m) of the
     Code.

u)   "Plan" means this SBE, Inc. 1996 Stock Option Plan.

v)   "Rule  16b-3" means Rule 16b-3 of the Exchange Act or any successor to Rule
     16b-3,  as in effect when discretion is being exercised with respect to the
     Plan.
                                       10
<PAGE>

3)   ADMINISTRATION.

a)   The Plan shall be administered by the Board unless and until the Board
     delegates administration to a Committee, as provided in subsection 3(c).

b)   The Board shall have the power, subject to, and within the limitations of,
     the express provisions of the Plan:

     i)   To determine from time to time which of the persons eligible under the
          Plan  shall  be  granted  Options;  when  and how each Option shall be
          granted;  whether  an  Option  will  be an Incentive Stock Option or a
          Nonstatutory  Stock  Option;  the  provisions  of  each Option granted
          (which need not be identical), including the time or times such Option
          may  be  exercised  in  whole or in part; and the number of shares for
          which  an  Option  shall  be  granted  to  each  such  person.

     ii)  To  construe  and interpret the Plan and Options granted under it, and
          to  establish,  amend  and  revoke  rules  and  regulations  for  its
          administration.  The Board, in the exercise of this power, may correct
          any  defect,  omission  or  inconsistency in the Plan or in any Option
          Agreement,  in  a  manner and to the extent it shall deem necessary or
          expedient  to  make  the  Plan  fully  effective.

     iii) To  amend  the  Plan  or  an  Option  as  provided  in  Section  11.

     iv)  Generally,  to  exercise  such  powers and to perform such acts as the
          Board  deems  necessary  or expedient to promote the best interests of
          the  Company.

c)   The  Board  may delegate administration of the Plan to a committee composed
     of  not fewer than two (2) members (the "Committee"), all of the members of
     which  Committee  shall  be  Disinterested  Persons and may also be, in the
     discretion  of the Board, Outside Directors. If administration is delegated
     to  a  Committee,  the  Committee  shall  have,  in  connection  with  the
     administration  of  the Plan, the powers theretofore possessed by the Board
     (and  references  in  this  Plan  to  the  Board shall thereafter be to the
     Committee),  subject,  however,  to such resolutions, not inconsistent with
     the  provisions  of  the  Plan,  as may be adopted from time to time by the
     Board.  The  Board  may abolish the Committee at any time and revest in the
     Board  the  administration  of  the  Plan. Notwithstanding anything in this
     Section  3  to  the  contrary, the Board or the Committee may delegate to a
     committee of one or more persons the authority to grant Options to eligible
     persons  who  (1)  are  not  then subject to Section 16 of the Exchange Act
     and/or  (2)  are either (i) not then Covered Employees and are not expected
     to be Covered Employees at the time of recognition of income resulting from
     such Option, or (ii) not persons with respect to whom the Company wishes to
     comply  with  Section  162(m)  of  the  Code.

d)   Any requirement that an administrator of the Plan be a Disinterested Person
     shall  not apply if the Board or the Committee expressly declares that such
     requirement  shall  not  apply.  Any  Disinterested  Person shall otherwise
     comply  with  the  requirements  of  Rule  16b-3.
                                       11
<PAGE>

4)   SHARES  SUBJECT  TO  THE  PLAN.

a)   Subject  to  the  provisions  of  Section  10  relating to adjustments upon
     changes  in stock, the stock that may be sold pursuant to Options shall not
     exceed  in  the  aggregate  one  million  five  hundred  eighty  thousand
     (1,580,000)  shares  of the Company's common stock. If any Option shall for
     any  reason  expire  or  otherwise  terminate, in whole or in part, without
     having  been  exercised  in full, the stock not purchased under such Option
     shall  revert  to  and  again become available for issuance under the Plan.

b)   The  stock subject to the Plan may be unissued shares or reacquired shares,
     bought  on  the  market  or  otherwise.

5)     ELIGIBILITY.

a)   Incentive  Stock  Options  may  be  granted only to Employees. Nonstatutory
     Stock  Options  may be granted only to Employees, Directors or Consultants.

b)   A  Director  shall  in  no  event  be eligible for the benefits of the Plan
     unless at the time discretion is exercised in the selection of the Director
     as  a person to whom Options may be granted, or in the determination of the
     number  of  shares which may be covered by Options granted to the Director:
     (i)  the Board has delegated its discretionary authority over the Plan to a
     Committee  which consists solely of Disinterested Persons; or (ii) the Plan
     otherwise  complies  with  the  requirements of Rule 16b-3. The Board shall
     otherwise  comply with the requirements of Rule 16b-3. This subsection 5(b)
     shall  not apply if the Board or Committee expressly declares that it shall
     not  apply.

c)   No  person shall be eligible for the grant of an Incentive Stock Option if,
     at  the  time  of  grant, such person owns (or is deemed to own pursuant to
     Section 424(d) of the Code) stock possessing more than ten percent (10%) of
     the  total  combined voting power of all classes of stock of the Company or
     of  any of its Affiliates unless the exercise price of such Incentive Stock
     Option  is at least one hundred ten percent (110%) of the Fair Market Value
     of  such  stock  at the date of grant and the Incentive Stock Option is not
     exercisable  after the expiration of five (5) years from the date of grant.

d)   Subject  to  the  provisions  of  Section  10  relating to adjustments upon
     changes  in  stock,  no  person  shall  be  eligible  to be granted Options
     covering  more  than  one  hundred  fifty  thousand (150,000) shares of the
     Company's  common  stock  in  any  calendar  year.

6)   OPTION  PROVISIONS.

     Each  Option  shall  be  in  such  form  and  shall  contain such terms and
conditions  as  the  Board  shall  deem  appropriate. The provisions of separate
Options  need  not  be  identical,  but  each  Option  shall  include  (through
incorporation  of provisions hereof by reference in the Option or otherwise) the
substance  of  each  of  the  following  provisions:

a)   TERM. No Option shall be exercisable after the expiration of ten (10) years
     from  the  date  it  was  granted.
                                       12
<PAGE>

b)   PRICE.  The exercise price of each Incentive Stock Option shall be not less
     than  one  hundred  percent  (100%)  of  the Fair Market Value of the stock
     subject to the Option on the date the Option is granted; the exercise price
     of  each  Nonstatutory  Stock  Option  shall  be  not less than eighty-five
     percent  (85%)  of the Fair Market Value of the stock subject to the Option
     on the date the Option is granted. Notwithstanding the foregoing, an Option
     (whether  an  Incentive Stock Option or a Nonstatutory Stock Option) may be
     granted  with  an exercise price lower than that set forth in the preceding
     sentence  if  such  Option  is  granted  pursuant  to  an  assumption  or
     substitution  for  another  option in a manner satisfying the provisions of
     Section  424(a)  of the Code. c) CONSIDERATION. The purchase price of stock
     acquired  pursuant  to  an Option shall be paid, to the extent permitted by
     applicable  statutes  and  regulations,  either (i) in cash at the time the
     Option  is  exercised,  or  (ii)  at  the  discretion  of  the Board or the
     Committee,  at  the time of the grant of the Option, (A) by delivery to the
     Company  of  other common stock of the Company, (B) according to a deferred
     payment  or  other  arrangement  (which  may  include, without limiting the
     generality  of the foregoing, the use of other common stock of the Company)
     with  the  person  to  whom  the Option is granted or to whom the Option is
     transferred  pursuant to subsection 6(d), or (C) in any other form of legal
     consideration  that  may  be  acceptable  to  the  Board.

     In  the case of any deferred payment arrangement, interest shall be payable
     at  least  annually  and  shall  be charged at the minimum rate of interest
     necessary  to  avoid  the  treatment  as  interest,  under  any  applicable
     provisions  of  the  Code,  of  any amounts other than amounts stated to be
     interest  under  the  deferred  payment  arrangement.

d)   TRANSFERABILITY. An Incentive Stock Option shall not be transferable except
     by  will  or  by  the  laws  of  descent  and  distribution,  and  shall be
     exercisable  during  the lifetime of the person to whom the Incentive Stock
     Option  is  granted  only by such person. A Nonstatutory Stock Option shall
     not  be  transferable  except  by  will  or  by  the  laws  of  descent and
     distribution or pursuant to a qualified domestic relations order satisfying
     the  requirements  of  Rule  16b-3 and the rules thereunder (a "QDRO"), and
     shall  be  exercisable during the lifetime of the person to whom the Option
     is  granted  only  by such person or any transferee pursuant to a QDRO. The
     person  to  whom the Option is granted may, by delivering written notice to
     the Company, in a form satisfactory to the Company, designate a third party
     who,  in  the  event  of  the  death  of  the Optionee, shall thereafter be
     entitled  to  exercise  the  Option.

e)   VESTING.  The total number of shares of stock subject to an Option may, but
     need not, be allotted in periodic installments (which may, but need not, be
     equal). The Option Agreement may provide that from time to time during each
     of  such  installment  periods,  the Option may become exercisable ("vest")
     with  respect to some or all of the shares allotted to that period, and may
     be  exercised  with  respect  to some or all of the shares allotted to such
     period and/or any prior period as to which the Option became vested but was
     not  fully  exercised.  The  Option  may be subject to such other terms and
     conditions  on  the  time  or  times when it may be exercised (which may be
     based  on performance or other criteria) as the Board may deem appropriate.
     The provisions of this subsection 6(e) are subject to any Option provisions
     governing  the  minimum  number  of  shares  as  to  which an Option may be
     exercised.
                                       13
<PAGE>

f)   SECURITIES  LAW  COMPLIANCE.  The  Company may require any Optionee, or any
     person  to  whom  an  Option  is  transferred  under  subsection 6(d), as a
     condition  of  exercising  any  such Option, (1) to give written assurances
     satisfactory  to  the Company as to the Optionee's knowledge and experience
     in  financial  and  business  matters  and/or  to  employ  a  purchaser
     representative  reasonably satisfactory to the Company who is knowledgeable
     and  experienced  in  financial and business matters, and that he or she is
     capable of evaluating, alone or together with the purchaser representative,
     the  merits  and  risks  of  exercising the Option; and (2) to give written
     assurances  satisfactory  to  the  Company  stating  that  such  person  is
     acquiring the stock subject to the Option for such person's own account and
     not  with  any  present  intention of selling or otherwise distributing the
     stock.  The  foregoing  requirements,  and any assurances given pursuant to
     such  requirements,  shall be inoperative if (i) the issuance of the shares
     upon  the exercise of the Option has been registered under a then currently
     effective  registration  statement  under  the  Securities  Act of 1933, as
     amended (the "Securities Act"), or (ii) as to any particular requirement, a
     determination is made by counsel for the Company that such requirement need
     not  be met in the circumstances under the then applicable securities laws.
     The Company may require the Optionee to provide such other representations,
     written  assurances  or  information  which  the Company shall determine is
     necessary,  desirable  or  appropriate to comply with applicable securities
     and  other  laws  as  a condition of granting an Option to such Optionee or
     permitting  the  Optionee  to  exercise  such Option. The Company may, upon
     advice  of  counsel  to  the  Company,  place legends on stock certificates
     issued  under  the  Plan  as such counsel deems necessary or appropriate in
     order to comply with applicable securities laws, including, but not limited
     to,  legends  restricting  the  transfer  of  the  stock.

g)   TERMINATION  OF  EMPLOYMENT OR RELATIONSHIP AS A DIRECTOR OR CONSULTANT. In
     the  event  an  Optionee's  Continuous  Status  as an Employee, Director or
     Consultant terminates (other than upon the Optionee's death or disability),
     the  Optionee  may  exercise  his  or  her  Option  (to the extent that the
     Optionee  was  entitled  to  exercise it as of the date of termination) but
     only within such period of time ending on the earlier of (i) the date three
     (3)  months after the termination of the Optionee's Continuous Status as an
     Employee,  Director  or  Consultant,  or  such  longer  or  shorter  period
     specified  in  the  Option Agreement, or (ii) the expiration of the term of
     the Option as set forth in the Option Agreement. If, after termination, the
     Optionee  does  not exercise his or her Option within the time specified in
     the Option Agreement, the Option shall terminate, and the shares covered by
     such  Option  shall revert to and again become available for issuance under
     the  Plan.

h)   DISABILITY  OF OPTIONEE. In the event an Optionee's Continuous Status as an
     Employee,  Director  or Consultant terminates as a result of the Optionee's
     disability, the Optionee may exercise his or her Option (to the extent that
     the  Optionee  was  entitled to exercise it as of the date of termination),
     but  only  within such period of time ending on the earlier of (i) the date
     twelve  (12)  months  following such termination (or such longer or shorter
     period  specified  in  the Option Agreement), or (ii) the expiration of the
     term of the Option as set forth in the Option Agreement. If, at the date of
     termination,  the  Optionee  is  not entitled to exercise his or her entire
     Option, the shares covered by the unexercisable portion of the Option shall
     revert to and again become available for issuance under the Plan. If, after
     termination,  the  Optionee  does not exercise his or her Option within the
     time  specified  herein, the Option shall terminate, and the shares covered
     by  such  Option  shall  revert  to and again become available for issuance
     under  the  Plan.
                                       14
<PAGE>

i)   DEATH  OF  OPTIONEE.  In  the  event of the death of an Optionee during, or
     within a period specified in the Option Agreement after the termination of,
     the  Optionee's  Continuous  Status as an Employee, Director or Consultant,
     the  Option  may  be  exercised (to the extent the Optionee was entitled to
     exercise the Option as of the date of death) by the Optionee's estate, by a
     person  who  acquired  the  right  to  exercise  the  Option  by bequest or
     inheritance  or  by  a  person  designated  to exercise the option upon the
     Optionee's  death  pursuant  to subsection 6(d), but only within the period
     ending  on  the  earlier of (i) the date eighteen (18) months following the
     date  of  death  (or  such longer or shorter period specified in the Option
     Agreement),  or (ii) the expiration of the term of such Option as set forth
     in  the  Option  Agreement.  If, at the time of death, the Optionee was not
     entitled  to  exercise  his or her entire Option, the shares covered by the
     unexercisable  portion  of  the  Option  shall  revert  to and again become
     available  for  issuance under the Plan. If, after death, the Option is not
     exercised within the time specified herein, the Option shall terminate, and
     the  shares  covered  by  such  Option  shall  revert  to  and again become
     available  for  issuance  under  the  Plan.

j)   EARLY  EXERCISE.  The Option may, but need not, include a provision whereby
     the  Optionee  may  elect  at  any  time  while  an  Employee,  Director or
     Consultant  to  exercise  the  Option  as  to any part or all of the shares
     subject to the Option prior to the full vesting of the Option. Any unvested
     shares  so  purchased  may be subject to a repurchase right in favor of the
     Company or to any other restriction the Board determines to be appropriate.

k)   WITHHOLDING.  To  the  extent provided by the terms of an Option Agreement,
     the  Optionee  may  satisfy  any  federal,  state  or local tax withholding
     obligation  relating to the exercise of such Option by any of the following
     means  or by a combination of such means: (1) tendering a cash payment; (2)
     authorizing  the  Company  to withhold shares from the shares of the common
     stock otherwise issuable to the Optionee as a result of the exercise of the
     Option;  or  (3) delivering to the Company owned and unencumbered shares of
     the  common  stock  of  the  Company.

7)   COVENANTS  OF  THE  COMPANY.

a)   During  the  terms  of the Options, the Company shall keep available at all
     times  the  number  of  shares  of  stock required to satisfy such Options.

b)   The  Company shall seek to obtain from each regulatory commission or agency
     having  jurisdiction  over  the  Plan  such authority as may be required to
     issue  and  sell  shares  of  stock upon exercise of the Options; provided,
     however,  that  this  undertaking shall not require the Company to register
     under the Securities Act either the Plan, any Option or any stock issued or
     issuable  pursuant  to  any  such Option. If, after reasonable efforts, the
     Company  is  unable to obtain from any such regulatory commission or agency
     the  authority which counsel for the Company deems necessary for the lawful
     issuance  and  sale  of stock under the Plan, the Company shall be relieved
     from  any  liability  for  failure to issue and sell stock upon exercise of
     such  Options  unless  and  until  such  authority  is  obtained.
                                       15
<PAGE>

8)   USE  OF  PROCEEDS  FROM  STOCK.

     Proceeds  from  the  sale  of  stock  pursuant  to Options shall constitute
     general  funds  of  the  Company.

9)   MISCELLANEOUS.

a)   The  Board  shall  have the power to accelerate the time at which an Option
     may  first  be  exercised  or  the  time during which an Option or any part
     thereof  will  vest  pursuant  to  subsection  6(e),  notwithstanding  the
     provisions  in  the  Option  stating  the  time  at  which  it may first be
     exercised  or  the  time  during  which  it  will  vest.

b)   Neither  an  Optionee nor any person to whom an Option is transferred under
     subsection  6(d) shall be deemed to be the holder of, or to have any of the
     rights  of  a  holder  with  respect  to, any shares subject to such Option
     unless and until such person has satisfied all requirements for exercise of
     the  Option  pursuant  to  its  terms.

c)   Nothing  in  the Plan or any instrument executed or Option granted pursuant
     thereto  shall  confer  upon any Employee, Director, Consultant or Optionee
     any  right to continue in the employ of the Company or any Affiliate (or to
     continue  acting  as a Director or Consultant) or shall affect the right of
     the  Company  or any Affiliate to terminate the employment of any Employee,
     with  or without cause, to remove any Director as provided in the Company's
     By-Laws  and  the provisions of the General Corporation Law of the State of
     Delaware,  or to terminate the relationship of any Consultant in accordance
     with the terms of that Consultant's agreement with the Company or Affiliate
     to  which  such  Consultant  is  providing  services.

d)   To  the extent that the aggregate Fair Market Value (determined at the time
     of  grant)  of  stock  with  respect  to  which Incentive Stock Options are
     exercisable  for  the  first  time by any Optionee during any calendar year
     under  all  plans  of  the  Company  and its Affiliates exceeds one hundred
     thousand  dollars  ($100,000), the Options or portions thereof which exceed
     such  limit  (according  to  the order in which they were granted) shall be
     treated  as  Nonstatutory  Stock  Options.

e)   i)   The Board or the Committee shall have the authority to effect, at
          any time and from time to  time  (i)  the repricing of any outstanding
          Options  under  the  Plan and/or (ii) with the consent of the affected
          holders  of  Options,  the cancellation of any outstanding Options and
          the  grant  in  substitution  therefor  of  new Options under the Plan
          covering  the same or different numbers of shares of common stock, but
          having  an  exercise price per share not less than eighty-five percent
          (85%) of the Fair Market Value (one hundred percent (100%) of the Fair
          Market  Value in the case of an Incentive Stock Option or, in the case
          of  an  Incentive  Stock  Option  granted  to  a  ten  percent  (10%)
          stockholder (as defined in subsection 5(c)), not less than one hundred
          and  ten  percent (110%) of the Fair Market Value) per share of common
          stock  on  the  new  grant  date.
                                       16
<PAGE>

     ii)  Shares  subject to an Option canceled under this subsection 9(f) shall
          continue  to be counted against the maximum award of Options permitted
          to  be  granted pursuant to subsection 5(d) of the Plan. The repricing
          of  an  Option under this subsection 9(f), resulting in a reduction of
          the  exercise  price,  shall  be  deemed  to  be a cancellation of the
          original  Option and the grant of a substitute Option; in the event of
          such repricing, both the original and the substituted Options shall be
          counted  against the maximum awards of Options permitted to be granted
          pursuant  to  subsection  5(d)  of  the  Plan.  The provisions of this
          subsection  9(f)  shall  be  applicable only to the extent required by
          Section  162(m)  of  the  Code.

10)  ADJUSTMENTS  UPON  CHANGES  IN  STOCK.

a)   If  any  change is made in the stock subject to the Plan, or subject to any
     Option  (through  merger,  consolidation, reorganization, recapitalization,
     stock  dividend,  dividend  in  property  other  than  cash,  stock  split,
     liquidating  dividend, combination of shares, exchange of shares, change in
     corporate  structure  or  other  transaction  not  involving the receipt of
     consideration  by  the Company), the Plan will be appropriately adjusted in
     the  class(es) and maximum number of shares subject to the Plan pursuant to
     subsection  4(a)  and  the maximum number of shares subject to award to any
     person  during  any  calendar  year  pursuant  to  subsection 5(d), and the
     outstanding  Options  will  be  appropriately adjusted in the class(es) and
     number  of  shares and price per share of stock subject to such outstanding
     Options.  Such  adjustments  shall  be  made by the Board or Committee, the
     determination  of  which  shall  be  final,  binding  and  conclusive. (The
     conversion  of  any  convertible  securities  of  the  Company shall not be
     treated as a "transaction not involving the receipt of consideration by the
     Company.")

b)   In  the  event  of:  (1)  a  dissolution,  liquidation,  or  sale of all or
     substantially  all  of  the  assets  of  the  Company;  (2)  a  merger  or
     consolidation  in which the Company is not the surviving corporation; (3) a
     reverse  merger  in  which the Company is the surviving corporation but the
     shares  of the Company's common stock outstanding immediately preceding the
     merger  are  converted by virtue of the merger into other property, whether
     in the form of securities, cash or otherwise; or (4) the acquisition by any
     person, entity or group within the meaning of Section 13(d) or 14(d) of the
     Exchange  Act,  or  any  comparable  successor  provisions  (excluding  any
     employee  benefit  plan,  or  related trust, sponsored or maintained by the
     Company  or  any  Affiliate  of  the  Company)  of the beneficial ownership
     (within  the  meaning  of Rule 13d-3 promulgated under the Exchange Act, or
     comparable  successor  rule)  of  securities of the Company representing at
     least  fifty percent (50%) of the combined voting power entitled to vote in
     the  election of directors, then to the extent permitted by applicable law:
     (i)  any  surviving  or  acquiring  corporation  shall  assume  any Options
     outstanding  under  the Plan or shall substitute similar Options (including
     an option to acquire the same consideration paid to the stockholders in the
     transaction described in this subsection 10(b)) for those outstanding under
     the  Plan, or (ii) such Options shall continue in full force and effect. In
     the  event  any  surviving  or acquiring corporation refuses to assume such
     Options,  or  to substitute similar options for those outstanding under the
     Plan,  then,  with  respect  to  Options  held  by  persons then performing
     services as Employees, Directors or Consultants, the time during which such
     Options  may  be exercised shall be accelerated prior to such event and the
     Options terminated if not exercised after such acceleration and at or prior
     to  such  event.
                                       17
<PAGE>

11)  AMENDMENT  OF  THE  PLAN  AND  OPTIONS.

a)   The  Board at any time, and from time to time, may amend the Plan. However,
     except  as  provided  in Section 10 relating to adjustments upon changes in
     stock,  no amendment shall be effective unless approved by the stockholders
     of  the  Company  within twelve (12) months before or after the adoption of
     the  amendment,  where  the  amendment  will:

     i)   Increase  the  number  of  shares reserved for Options under the Plan;

     ii)  Modify  the  requirements  as  to eligibility for participation in the
          Plan (to the extent such modification requires stockholder approval in
          order  for  the Plan to satisfy the requirements of Section 422 of the
          Code);  or

     iii) Modify  the Plan in any other way if such modification requires stock-
          holder  approval  in order for the Plan to satisfy the requirements of
          Section  422  of  the  Code or to comply with the requirements of Rule
          16b-3.

b)   The Board may in its sole discretion submit any other amendment to the Plan
     for  stockholder approval, including, but not limited to, amendments to the
     Plan intended to satisfy the requirements of Section 162(m) of the Code and
     the  regulations  promulgated  thereunder  regarding  the  exclusion  of
     performance-based compensation from the limit on corporate deductibility of
     compensation  paid  to  certain  executive  officers.

c)   It  is  expressly  contemplated  that  the  Board may amend the Plan in any
     respect  the  Board  deems necessary or advisable to provide Optionees with
     the maximum benefits provided or to be provided under the provisions of the
     Code and the regulations promulgated thereunder relating to Incentive Stock
     Options  and/or  to  bring  the Plan and/or Incentive Stock Options granted
     under  it  into  compliance  therewith.

d)   Rights  and  obligations  under  any Option granted before amendment of the
     Plan  shall  not  be  impaired  by any amendment of the Plan unless (i) the
     Company  requests  the consent of the person to whom the Option was granted
     and  (ii)  such  person  consents  in  writing.

e)   The  Board  at  any time, and from time to time, may amend the terms of any
     one  or  more  Options;  provided, however, that the rights and obligations
     under any Option shall not be impaired by any such amendment unless (i) the
     Company  requests  the consent of the person to whom the Option was granted
     and  (ii)  such  person  consents  in  writing.

12)  TERMINATION  OR  SUSPENSION  OF  THE  PLAN.

a)   The  Board  may  suspend  or  terminate the Plan at any time. Unless sooner
     terminated,  the  Plan  shall  terminate on January 17, 2006 which shall be
     within  ten  (10)  years  from the date the Plan is adopted by the Board or
     approved  by  the  stockholders  of  the  Company, whichever is earlier. No
     Options  may be granted under the Plan while the Plan is suspended or after
     it  is  terminated.
                                       18
<PAGE>

b)   Rights and obligations under any Option granted while the Plan is in effect
     shall not be impaired by suspension or termination of the Plan, except with
     the  written  consent  of  the  person  to  whom  the  Option  was granted.

13)     EFFECTIVE  DATE  OF  PLAN.

     The  Plan shall become effective as determined by the Board, but no Options
granted  under  the  Plan  shall be exercised unless and until the Plan has been
approved  by  the  stockholders  of  the Company, which approval shall be within
twelve  (12)  months  before or after the date the Plan is adopted by the Board.



                                       19
<PAGE>

                             INCENTIVE STOCK OPTION

     ____________________,  Optionee:

     SBE,  Inc.  (the  "Company"),  pursuant  to its 1996 Stock Option Plan (the
"Plan"),  has  granted  to  you, the optionee named above, an option to purchase
shares  of  the  common  stock  of  the Company ("Common Stock"). This option is
intended to qualify as an "incentive stock option" within the meaning of Section
422  of  the  Internal  Revenue  Code  of  1986,  as  amended  (the  "Code").

     The  grant  hereunder  is  in  connection  with  and  in furtherance of the
Company's compensatory benefit plan for participation of the Company's employees
(including  officers),  directors  or  consultants.

     The  details  of  your  option  are  as  follows:

1.   TOTAL  NUMBER  OF SHARES SUBJECT TO THIS OPTION. The total number of shares
     of  Common  Stock  subject  to  this  option  is  ____________________
     (__________).

2.   VESTING.  Subject  to  the  limitations contained herein, __________ of the
     shares will vest (become exercisable) on ____________, _____ and __________
     of  the shares will then vest each ____________ thereafter until either (i)
     you  cease  to provide services to the Company for any reason, or (ii) this
     option  becomes  fully  vested.

3.   EXERCISE  PRICE  AND  METHOD  OF  PAYMENT.

a)   EXERCISE  PRICE.  The  exercise  price  of  this  option  is
     ___________________________  ($___________)  per share, being not less than
     the  fair  market  value  of  the Common Stock on the date of grant of this
     option.  b)  Method  of Payment. Payment of the exercise price per share is
     due  in full upon exercise of all or any part of each installment which has
     accrued  to  you.  You  may  elect,  to  the extent permitted by applicable
     statutes  and  regulations, to make payment of the exercise price under one
     of  the  following  alternatives:

     (i)  Payment  of  the exercise price per share in cash (including check) at
          the  time  of  exercise;

     (ii) Payment  pursuant  to  a  program  developed  under  Regulation  T  as
          promulgated  by the Federal Reserve Board which, prior to the issuance
          of  Common  Stock, results in either the receipt of cash (or check) by
          the  Company  or  the  receipt  of irrevocable instructions to pay the
          aggregate  exercise  price  to  the  Company  from the sales proceeds;

     (iii)  Provided  that at the time of exercise the Company's Common Stock is
          publicly  traded  and  quoted  regularly  in  the Wall Street Journal,
          payment  by delivery of already-owned shares of Common Stock, held for
          the  period  required  to  avoid  a  charge  to the Company's reported
          earnings,  and owned free and clear of any liens, claims, encumbrances
          or  security interests, which Common Stock shall be valued at its fair
          market  value  on  the  date  of  exercise;  or
                                       20
<PAGE>

     (iv) Payment  by  a  combination  of  the  methods  of payment permitted by
          subparagraph  3(b)(i)  through  3(b)(iii)  above.

4.   WHOLE  SHARES;  MINIMUM  SHARES  EXERCISABLE.

a)   This  option  may  not  be  exercised  for any number of shares which would
     require  the  issuance  of  anything  other  than  whole  shares.

b)   The  minimum  number  of  shares  with  respect to which this option may be
     exercised  at  any one time is one hundred (100) shares, except that (i) as
     to that number of shares to which it is exercisable under the provisions of
     paragraph  2  of  this  option, if fewer than one hundred (100) shares, the
     number  of  such  shares  exercisable shall be the minimum number of shares
     that  are vested thereunder, and (ii) with respect to the final exercise of
     this  option  this  minimum  shall  not  apply.

5.   SECURITIES  LAW  COMPLIANCE.  Notwithstanding  anything  to  the  contrary
     contained  herein,  this  option  may  not  be  exercised unless the shares
     issuable upon exercise of this option are then registered under the Act or,
     if  such shares are not then so registered, the Company has determined that
     such  exercise  and  issuance  would  be  exempt  from  the  registration
     requirements  of  the  Act.

6.   TERM.  The  term of this option commences on __________, _____, the date of
     grant,  and expires on ---___________________ (the "Expiration Date," which
     date  shall  be  no  more  than ten (10) years from the date this option is
     granted),  unless  this  option expires sooner as set forth below or in the
     Plan.  In  no event may this option be exercised on or after the Expiration
     Date.  This option shall terminate prior to the Expiration Date as follows:
     three  (3)  months  after  the  termination of your Continuous Status as an
     Employee,  Director  or  Consultant with the Company or an Affiliate of the
     Company  unless  one  of  the  following  circumstances  exists:

a)   Your  termination  of  Continuous  Status  as  an  Employee,  Director  or
     Consultant  is  due  to  your  permanent  and  total disability (within the
     meaning  of Section 422(c)(6) of the Code). This option will then expire on
     the  earlier  of  the Expiration Date set forth above or twelve (12) months
     following such termination of Continuous Status as an Employee, Director or
     Consultant.

b)   Your  termination  of  Continuous  Status  as  an  Employee,  Director  or
     Consultant  is  due  to  your  death  or your death occurs within three (3)
     months  following  your  termination  of  Continuous Status as an Employee,
     Director  or  Consultant for any other reason. This option will then expire
     on  the  earlier  of  the  Expiration Date set forth above or eighteen (18)
     months  after  your  death.

c)   If during any part of such three (3) month period you may not exercise your
     option solely because of the condition set forth in paragraph 5 above, then
     your  option  will  not expire until the earlier of the Expiration Date set
     forth  above  or  until  this  option  shall  have  been exercisable for an
     aggregate  period  of three (3) months after your termination of Continuous
     Status  as  an  Employee,  Director  or  Consultant.
                                       21
<PAGE>

d)   If your exercise of the option within three (3) months after termination of
     your  Continuous  Status  as  an  Employee, Director or Consultant with the
     Company or with an Affiliate of the Company would result in liability under
     section 16(b) of the Securities Exchange Act of 1934, then your option will
     expire  on the earlier of (i) the Expiration Date set forth above, (ii) the
     tenth  (10th)  day  after the last date upon which exercise would result in
     such  liability  or  (iii)  six  (6)  months  and  ten  (10) days after the
     termination  of  your  Continuous  Status  as  an  Employee,  Director  or
     Consultant  with  the  Company  or  an  Affiliate  of  the  Company.

     However,  this  option may be exercised following termination of Continuous
Status  as  an Employee, Director or Consultant only as to that number of shares
as  to  which it was exercisable on the date of termination of Continuous Status
as  an  Employee,  Director or Consultant under the provisions of paragraph 2 of
this  option.

     In  order  to  obtain  the federal income tax advantages associated with an
"incentive  stock  option," the Code requires that at all times beginning on the
date  of  grant  of the option and ending on the day three (3) months before the
date  of  the  option's  exercise,  you must be an employee of the Company or an
Affiliate  of  the  Company,  except in the event of your death or permanent and
total  disability.  The  Company  has provided for continued vesting or extended
exercisability  of your option under certain circumstances for your benefit, but
cannot  guarantee  that your option will necessarily be treated as an "incentive
stock  option"  if  you  provide  services to the Company or an Affiliate of the
Company as a consultant or exercise your option more than three (3) months after
the  date  your  employment  with  the Company and all Affiliates of the Company
terminates.

7.   EXERCISE.

a)   This  option may be exercised, to the extent specified above, by delivering
     a  notice  of  exercise (in a form designated by the Company) together with
     the exercise price to the Secretary of the Company, or to such other person
     as  the Company may designate, during regular business hours, together with
     such  additional  documents  as  the  Company  may then require pursuant to
     subsection  6(f)  of  the  Plan.

b)   By  exercising  this  option  you  agree  that:

     (i)  as  a  precondition  to the completion of any exercise of this option,
          the  Company may require you to enter an arrangement providing for the
          payment by you to the Company of any tax withholding obligation of the
          Company  arising by reason of (1) the exercise of this option; (2) the
          lapse  of  any  substantial risk of forfeiture to which the shares are
          subject  at  the  time  of  exercise; or (3) the disposition of shares
          acquired  upon  such  exercise;

     (ii) you  will notify the Company in writing within fifteen (15) days after
          the  date  of any disposition of any of the shares of the Common Stock
          issued  upon  exercise of this option that occurs within two (2) years
          after  the date of this option grant or within one (1) year after such
          shares  of  Common Stock are transferred upon exercise of this option;
          and
                                       22
<PAGE>

8.   TRANSFERABILITY.  This option is not transferable, except by will or by the
     laws  of descent and distribution, and is exercisable during your life only
     by  you. Notwithstanding the foregoing, by delivering written notice to the
     Company,  in  a form satisfactory to the Company, you may designate a third
     party  who,  in  the  event  of your death, shall thereafter be entitled to
     exercise  this  option.

9.   OPTION  NOT  A  SERVICE CONTRACT. This option is not an employment contract
     and  nothing in this option shall be deemed to create in any way whatsoever
     any obligation on your part to continue in the employ of the Company, or of
     the  Company  to  continue  your  employment with the Company. In addition,
     nothing  in  this option shall obligate the Company or any Affiliate of the
     Company,  or their respective stockholders, Board of Directors, officers or
     employees  to  continue any relationship which you might have as a Director
     or  Consultant  for  the  Company  or  Affiliate  of  the  Company.

10.  NOTICES. Any notices provided for in this option or the Plan shall be given
     in  writing  and  shall be deemed effectively given upon receipt or, in the
     case  of  notices  delivered  by  the  Company  to you, five (5) days after
     deposit in the United States mail, postage prepaid, addressed to you at the
     address specified below or at such other address as you hereafter designate
     by  written  notice  to  the  Company.

11.  GOVERNING  PLAN  DOCUMENT.  This option is subject to all the provisions of
     the  Plan, a copy of which is attached hereto and its provisions are hereby
     made  a part of this option, including without limitation the provisions of
     Section 6 of the Plan relating to option provisions, and is further subject
     to  all  interpretations,  amendments, rules and regulations which may from
     time  to time be promulgated and adopted pursuant to the Plan. In the event
     of  any  conflict  between  the  provisions of this option and those of the
     Plan,  the  provisions  of  the  Plan  shall  control.

          Dated  the  ____  day  of  __________________,  _____.

                                        Very  truly  yours,
                                        ____________________________


                                        By
                                         ___________________________
                                        Duly  authorized  on behalf of the Board
                                        of  Directors

     ATTACHMENTS:

     SBE,  Inc.  1996  Stock  Option  Plan
     Notice  of  Exercise


                                       23
<PAGE>
     The  undersigned:

a)   Acknowledges receipt of the foregoing option and the attachments referenced
     therein  and  understands  that  all rights and liabilities with respect to
     this  option  are  set  forth  in  the  option  and  the  Plan;  and

b)   Acknowledges that as of the date of grant of this option, it sets forth the
     entire  understanding  between the undersigned optionee and the Company and
     its  Affiliates  regarding  the  acquisition  of  stock  in the Company and
     supersedes  all  prior oral and written agreements on that subject with the
     exception  of  (i)  the  options  previously  granted  and delivered to the
     undersigned under stock option plans of the Company, and (ii) the following
     agreements  only:

     NONE      ______________________________
               (Initial)

     OTHER
               ______________________________
               ______________________________

c)   Acknowledges  receipt  of  a  copy of Section 260.141.11 of Title 10 of the
     California  Code  of  Regulations.

                                              ________________________________
                                              OPTIONEE

     Address:
                                              _________________________________
                                              _________________________________



                                       24
<PAGE>
                            NONSTATUTORY STOCK OPTION


     ____________________,  Optionee:

     SBE,  Inc.  (the  "Company"),  pursuant  to its 1996 Stock Option Plan (the
"Plan"),  has  granted  to  you, the optionee named above, an option to purchase
shares  of  the common stock of the Company ("Common Stock"). This option is not
intended  to  qualify  and  will  not  be treated as an "incentive stock option"
within  the  meaning  of  Section  422  of the Internal Revenue Code of 1986, as
amended  (the  "Code").

     The  grant  hereunder  is  in  connection  with  and  in furtherance of the
Company's compensatory benefit plan for participation of the Company's employees
(including  officers),  directors or consultants. The details of your option are
as  follows:

1.   TOTAL  NUMBER  OF SHARES SUBJECT TO THIS OPTION. The total number of shares
     of  Common  Stock  subject to this option is _________________________ ( ).

2.   VESTING.  Subject  to  the  limitations contained herein, __________ of the
     shares will vest (become exercisable) on ____________, _____ and __________
     of  the shares will then vest each ____________ thereafter until either (i)
     you  cease  to provide services to the Company for ANY reason, or (ii) this
     option  becomes  fully  vested.

3.   EXERCISE  PRICE  AND  METHOD  OF  PAYMENT.

a)   EXERCISE  PRICE. The exercise price of this option is ($ ) per share, being
     not  less than 85% of the fair market value of the Common Stock on the date
     of  grant  of  this  option.

b)   METHOD  OF  PAYMENT. Payment of the exercise price per share is due in full
     upon  exercise  of all or any part of each installment which has accrued to
     you.  You  may  elect,  to  the extent permitted by applicable statutes and
     regulations,  to  make  payment  of  the  exercise  price  under one of the
     following  alternatives:

     (i)  Payment  of  the exercise price per share in cash (including check) at
          the  time  of  exercise;

     (ii) Payment  pursuant  to  a  program  developed  under  Regulation  T  as
          promulgated  by the Federal Reserve Board which, prior to the issuance
          of  Common  Stock, results in either the receipt of cash (or check) by
          the  Company  or  the  receipt  of irrevocable instructions to pay the
          aggregate  exercise  price  to  the  Company  from the sales proceeds;

     (iii)  Provided  that at the time of exercise the Company's Common Stock is
          publicly  traded  and  quoted  regularly  in  the Wall Street Journal,
          payment  by delivery of already-owned shares of Common Stock, held for
          the  period  required  to  avoid  a  charge  to the Company's reported
          earnings,  and owned free and clear of any liens, claims, encumbrances
          or  security interests, which Common Stock shall be valued at its fair
          market  value  on  the  date  of  exercise;  or
                                       25
<PAGE>

     (iv) Payment  by  a  combination  of  the  methods  of payment permitted by
          subparagraph  3(b)(i)  through  3(b)(iii)  above.

4.   WHOLE  SHARES;  MINIMUM  SHARES  EXERCISABLE.

a)   This  option  may  not  be  exercised  for any number of shares which would
     require  the  issuance  of  anything  other  than  whole  shares.

b)   The  minimum  number  of  shares  with  respect to which this option may be
     exercised  at  any one time is one hundred (100) shares, except that (i) as
     to that number of shares to which it is exercisable under the provisions of
     paragraph  2  of  this  option, if fewer than one hundred (100) shares, the
     number  of  such  shares  exercisable shall be the minimum number of shares
     that  are vested thereunder, and (ii) with respect to the final exercise of
     this  option  this  minimum  shall  not  apply.

5.   SECURITIES  LAW  COMPLIANCE.  Notwithstanding  anything  to  the  contrary
     contained  herein,  this  option  may  not  be  exercised unless the shares
     issuable upon exercise of this option are then registered under the Act or,
     if  such shares are not then so registered, the Company has determined that
     such  exercise  and  issuance  would  be  exempt  from  the  registration
     requirements  of  the  Act.

6.   TERM.  The  term  of this option commences on _________, _____, the date of
     grant  and expires on __________________ (the "Expiration Date," which date
     shall be no more than ten (10) years from the date this option is granted),
     unless  this option expires sooner as set forth below or in the Plan. In no
     event  may  this  option be exercised on or after the Expiration Date. This
     option  shall  terminate prior to the Expiration Date as follows: three (3)
     months  after  the  termination  of  your Continuous Status as an Employee,
     Director  or Consultant with the Company or an Affiliate of the Company for
     any  reason  or  for  no  reason  unless:

a)   such  termination  of  Continuous  Status  as  an  Employee,  Director  or
     Consultant  is  due  to  your  permanent  and  total disability (within the
     meaning  of Section 422(c)(6) of the Code), in which event the option shall
     expire on the earlier of the Expiration Date set forth above or twelve (12)
     months  following  such  termination  of  Continuous Status as an Employee,
     Director  or  Consultant;  or

b)   such  termination  of  Continuous  Status  as  an  Employee,  Director  or
     Consultant  is  due  to  your  death  or your death occurs within three (3)
     months  following your termination for any other reason, in which event the
     option  shall  expire on the earlier of the Expiration Date set forth above
     or  eighteen  (18)  months  after  your  death;  or

c)   during  any  part  of  such  three  (3)  month  period  the  option  is not
     exercisable solely because of the condition set forth in paragraph 5 above,
     in  which  event  the  option  shall  not  expire  until the earlier of the
     Expiration Date set forth above or until it shall have been exercisable for
     an aggregate period of three (3) months after the termination of Continuous
     Status  as  an  Employee,  Director  or  Consultant;  or
                                       26
<PAGE>

d)   exercise  of  the  option within three (3) months after termination of your
     Continuous  Status  as an Employee, Director or Consultant with the Company
     or with an Affiliate of the Company would result in liability under section
     16(b)  of the Securities Exchange Act of 1934 (the "Exchange Act), in which
     case  the  option will expire on the earlier of (i) the Expiration Date set
     forth  above,  (ii)  the  tenth  (10th)  day after the last date upon which
     exercise  would  result  in  such liability or (iii) six (6) months and ten
     (10)  days  after the termination of your Continuous Status as an Employee,
     Director  or  Consultant  with  the Company or an Affiliate of the Company.

     However,  this  option may be exercised following termination of Continuous
Status  as  an Employee, Director or Consultant only as to that number of shares
as  to  which it was exercisable on the date of termination of Continuous Status
as  an  Employee,  Director or Consultant under the provisions of paragraph 2 of
this  option.

7.   EXERCISE.

a)   This  option may be exercised, to the extent specified above, by delivering
     a  notice  of  exercise (in a form designated by the Company) together with
     the exercise price to the Secretary of the Company, or to such other person
     as  the Company may designate, during regular business hours, together with
     such  additional  documents  as  the  Company  may then require pursuant to
     subsection  6(f)  of  the  Plan.

b)   By  exercising  this  option  you  agree  that:

     (i)  as  a  precondition  to the completion of any exercise of this option,
          the  Company may require you to enter an arrangement providing for the
          cash  payment  by you to the Company of any tax withholding obligation
          of  the Company arising by reason of: (1) the exercise of this option;
          (2)  the  lapse  of  any  substantial  risk of forfeiture to which the
          shares  are subject at the time of exercise; or (3) the disposition of
          shares  acquired  upon such exercise. You also agree that any exercise
          of this option has not been completed and that the Company is under no
          obligation  to issue any Common Stock to you until such an arrangement
          is  established  or  the  Company's  tax  withholding  obligations are
          satisfied,  as  determined  by  the  Company;  and

8.   TRANSFERABILITY.  This option is not transferable, except by will or by the
     laws  of descent and distribution, and is exercisable during your life only
     by  you  or  pursuant to a qualified domestic relations order as satisfying
     the  requirements  of  Rule  16b-3  of  the Exchange Act (a "QDRO"), and is
     exercisable  during  your  life  only  by you or a transferee pursuant to a
     QDRO.  Notwithstanding  the  foregoing, by delivering written notice to the
     Company,  in  a form satisfactory to the Company, you may designate a third
     party  who,  in  the  event  of your death, shall thereafter be entitled to
     exercise  this  option.
                                       27
<PAGE>

9.   OPTION  NOT  A  SERVICE CONTRACT. This option is not an employment contract
     and  nothing in this option shall be deemed to create in any way whatsoever
     any obligation on your part to continue in the employ of the Company, or of
     the  Company  to  continue  your  employment with the Company. In addition,
     nothing  in  this option shall obligate the Company or any Affiliate of the
     Company, or their respective stockholders, Board of Directors, officers, or
     employees  to  continue any relationship which you might have as a Director
     or  Consultant  for  the  Company  or  Affiliate  of  the  Company.

10.  NOTICES. Any notices provided for in this option or the Plan shall be given
     in  writing  and  shall be deemed effectively given upon receipt or, in the
     case  of  notices  delivered  by  the  Company  to you, five (5) days after
     deposit in the United States mail, postage prepaid, addressed to you at the
     address specified below or at such other address as you hereafter designate
     by  written  notice  to  the  Company.

11.  GOVERNING  PLAN  DOCUMENT.  This option is subject to all the provisions of
     the  Plan, a copy of which is attached hereto and its provisions are hereby
     made  a part of this option, including without limitation the provisions of
     Section 6 of the Plan relating to option provisions, and is further subject
     to  all  interpretations,  amendments, rules and regulations which may from
     time  to time be promulgated and adopted pursuant to the Plan. In the event
     of  any  conflict  between  the  provisions of this option and those of the
     Plan,  the  provisions  of  the  Plan  shall  control.

          Dated  the  ____  day  of  __________________,  _____.

                                        Very truly  yours,
                                        ______________________________________

                                        By____________________________________
                                        Duly authorized  on  behalf of the Board
                                             of  Directors

     ATTACHMENTS:

     SBE,  Inc.  1996  Stock  Option  Plan
     Notice  of  Exercise


                                       28
<PAGE>

     The  undersigned:

a)   Acknowledges receipt of the foregoing option and the attachments referenced
     therein  and  understands  that  all rights and liabilities with respect to
     this  option  are  set  forth  in  the  option  and  the  Plan;  and

b)   Acknowledges that as of the date of grant of this option, it sets forth the
     entire  understanding  between the undersigned optionee and the Company and
     its  Affiliates  regarding  the  acquisition  of  stock  in the Company and
     supersedes  all  prior oral and written agreements on that subject with the
     exception  of  (i)  the  options  previously  granted  and delivered to the
     undersigned under stock option plans of the Company, and (ii) the following
     agreements  only:

     NONE      ____________________________
               (Initial)


     OTHER
               ____________________________
               ____________________________


c)   Acknowledges  receipt  of  a  copy of Section 260.141.11 of Title 10 of the
     California  Code  of  Regulations.

                                                       _________________________
                                                       OPTIONEE

                                                       Address:
                                                       _________________________
                                                       _________________________


                                       29
<PAGE>




</TEXT>
</DOCUMENT>
<DOCUMENT>
<TYPE>EX-99.2
<SEQUENCE>5
<FILENAME>stockplan_1998.txt
<TEXT>

Exhibit  99.2
                                    SBE, INC.

                       1998 NON-OFFICER STOCK OPTION PLAN

               ADOPTED BY THE BOARD OF DIRECTORS ON JUNE 15, 1998
                             AMENDED ON MAY 23, 2000
                             AMENDED ON MAY 22, 2001


1.   Purposes.

a)   ELIGIBLE OPTION RECIPIENTS. The persons eligible to receive Options are the
     non-officer  Employees  and  Consultants of the Company and its Affiliates.

b)   AVAILABLE  OPTIONS.  The purpose of the Plan is to provide a means by which
     eligible  recipients of Options may be given an opportunity to benefit from
     increases in value of the Common Stock through the granting of Nonstatutory
     Stock  Options.

c)   GENERAL  PURPOSE.  The  Company,  by means of the Plan, seeks to retain the
     services of the group of persons eligible to receive Options, to secure and
     retain  the services of new members of this group and to provide incentives
     for  such  persons  to exert maximum efforts for the success of the Company
     and  its  Affiliates.

2.   Definitions.

a)   "AFFILIATE"  means  any parent corporation or subsidiary corporation of the
     Company,  whether  now or hereafter existing, as those terms are defined in
     Sections  424(e)  and  (f),  respectively,  of  the  Code.

b)   "BOARD"  means  the  Board  of  Directors  of  the  Company.

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

d)   "COMMITTEE"  means  a  Committee  appointed by the Board in accordance with
     subsection  3(c).

e)   "COMMON  STOCK"  means  the  common  stock  of  the  Company.

f)   "COMPANY"  means  SBE,  Inc.,  a  Delaware  corporation.

g)   "CONSULTANT" means any person, including an advisor, engaged by the Company
     or  an  Affiliate  to  render  consulting  or  advisory services and who is
     compensated  for  such  services, provided that the term "Consultant" shall
     not  include  a  Director.
                                       30
<PAGE>

h)   "CONTINUOUS SERVICE" means that the Optionholder's service with the Company
     or  an  Affiliate,  whether  as an Employee, Director or Consultant, is not
     interrupted  or terminated. The Optionholder's Continuous Service shall not
     be  deemed to have terminated merely because of a change in the capacity in
     which the Optionholder renders service to the Company or an Affiliate as an
     Employee,  Consultant  or  Director or a change in the entity for which the
     Optionholder  renders  such service, provided that there is no interruption
     or  termination  of  the  Optionholder's Continuous Service. For example, a
     change  in  status  from  an  Employee of the Company to a Consultant of an
     Affiliate  or a Director of the Company will not constitute an interruption
     of  Continuous  Service.  The  Board  or the chief executive officer of the
     Company,  in that party's sole discretion, may determine whether Continuous
     Service shall be considered interrupted in the case of any leave of absence
     approved  by  that party, including sick leave, military leave or any other
     personal  leave.

i)   "DIRECTOR"  means  a  member  of  the  Board  of  Directors of the Company.

j)   "DISABILITY"  means  the  permanent and total disability of a person within
     the  meaning  of  Section  22(e)(3)  of  the  Code.

k)   "EMPLOYEE"  means  any person employed by the Company or an Affiliate. Mere
     service  as  a Director or payment of a director's fee by the Company or an
     Affiliate shall not be sufficient to constitute "employment" by the Company
     or  an  Affiliate.

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

m)   "FAIR  MARKET  VALUE"  means, as of any date, the value of the Common Stock
     determined  as  follows:

     i)   If  the  Common  Stock  is listed on any established stock exchange or
          traded  on  the  Nasdaq  National Market System or the Nasdaq SmallCap
          Market,  the Fair Market Value of a share of Common Stock shall be the
          closing  sales  price  for such stock (or the closing bid, if no sales
          were  reported)  as quoted on such exchange or market (or the exchange
          or  market with the greatest volume of trading in 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.

     ii)  In  the  absence of such markets for the Common Stock, the Fair Market
          Value  shall  be  determined  in  good  faith  by  the  Board.

n)   "NONSTATUTORY  STOCK  OPTION" means an Option not intended to qualify as an
     incentive  stock  option  within the meaning of Section 422 of the Code and
     the  regulations  promulgated  thereunder.
                                       31
<PAGE>

o)   "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, and each other person who is an officer within the
     meaning  of  Rule  4460(i)(1)  of  the  National  Association of Securities
     Dealers,  Inc. Manual or such other similar rule, regulation or requirement
     applicable  to  the  Company  in  connection with the listing of the Common
     Stock  for  trading  on  an  established  stock  exchange  or other market.

p)   "OPTION"  means  a  Nonstatutory Stock Option granted pursuant to the Plan.

q)   "OPTION  AGREEMENT"  means  a  written agreement between the Company and an
     Optionholder  evidencing  the  terms and conditions of an individual Option
     grant.  Each  Option Agreement shall be subject to the terms and conditions
     of  the  Plan.

r)   "OPTIONEE"  means  a  person  to  whom an Option is granted pursuant to the
     Plan.

s)   "OPTIONHOLDER" means a person who holds an outstanding Option granted under
     the  Plan,  including  (as  applicable)  the  Optionee's estate, person who
     acquired  the  right  to  exercise the Option by bequest or inheritance, or
     person designated to exercise the option upon the Optionee's death pursuant
     to  subsection  6(d).

t)   "PLAN"  means  this  SBE,  Inc.  1998  Non-Officer  Stock  Option  Plan.

u)   "SECURITIES  ACT"  means  the  Securities  Act  of  1933,  as  amended.

3.   Administration.

a)   ADMINISTRATION  BY  BOARD.  The  Board  will administer the Plan unless and
     until  the  Board  delegates  administration to a Committee, as provided in
     subsection  3(c).

b)   POWERS OF BOARD. The board shall have the power, subject to, and within the
     limitations  of,  the  express  provisions  of  the  Plan:

     i)   To determine from time to time which of the persons eligible under the
          Plan  shall  be  granted  Options;  when  and how each Option shall be
          granted;  the  provisions  of  each  Option granted (which need not be
          identical),  including  the  time  or  times  when  a  person shall be
          permitted  to  receive  stock pursuant to an Option; and the number of
          shares  with  respect to which an Option shall be granted to each such
          person.

     ii)  To  construe  and interpret the Plan and Options granted under it, and
          to  establish,  amend  and  revoke  rules  and  regulations  for  its
          administration.  The Board, in the exercise of this power, may correct
          any  defect,  omission  or  inconsistency in the Plan or in any Option
          Agreement,  in  a  manner and to the extent it shall deem necessary or
          expedient  to  make  the  Plan  fully  effective.
                                       32
<PAGE>

     iii) To  amend  the  Plan  or  an  Option  as  provided  in  Section  11.

     iv)  Generally,  to  exercise  such  powers and to perform such acts as the
          Board  deems  necessary  or expedient to promote the best interests of
          the Company which are not in conflict with the provisions of the Plan.

c)   DELEGATION  TO COMMITTEE. The Board may delegate administration of the Plan
     to  a  Committee or Committees of one or more members of the Board, and the
     term  "Committee"  shall  apply  to  any  person  or  persons  to whom such
     authority  has  been  delegated.  If  administration  is  delegated  to  a
     Committee,  the Committee shall have, in connection with the administration
     of  the  Plan, the powers theretofore possessed by the Board, including the
     power  to  delegate  to a subcommittee any of the administrative powers the
     Committee  is  authorized  to  exercise (and references in this Plan to the
     Board  shall  thereafter  be  to  the  Committee or subcommittee), subject,
     however,  to  such resolutions, not inconsistent with the provisions of the
     Plan,  as  may  be  adopted  from  time to time by the Board. The Board may
     abolish  the  Committee  at  any  time  and  revest  in  the  Board  the
     administration  of  the  Plan.

4.   Shares  Subject  to  the  Plan.

a)   SHARE  RESERVE.  Subject  to  the  provisions  of  Section  10  relating to
     adjustments upon changes in stock, the stock that may be issued pursuant to
     Options  shall  not  exceed  in  the  aggregate  six hundred fifty thousand
     (650,000)  shares  of  Common  Stock.

b)   REVERSION  OF  SHARES  TO  THE  SHARE  RESERVE. If any Option shall for any
     reason  expire  or otherwise terminate, in whole or in part, without having
     been  exercised  in  full,  the  stock not acquired under such Option shall
     revert  to  and  again become available for issuance under the Plan. If any
     Common  Stock  acquired pursuant to the exercise of an Option shall for any
     reason  be  repurchased  by  the Company under an unvested share repurchase
     option  provided under the Plan, the stock repurchased by the Company under
     such  repurchase  option shall not revert to and again become available for
     issuance  under  the  Plan.

c)   SOURCE  OF  SHARES. The stock subject to the Plan may be unissued shares or
     reacquired  shares,  bought  on  the  market  or  otherwise.

5.   Eligibility.

     Options may be granted only to Employees or Consultants who are not, at the
time  of  such  grants,  (i)  Directors  or  (ii)  Officers.

6.   Option  Provisions.

     Each  Option  shall  be  in  such  form  and  shall  contain such terms and
conditions  as  the  Board  shall  deem  appropriate. The provisions of separate
Options  need  not  be  identical,  but  each  Option  shall  include  (through
incorporation  of provisions hereof by reference in the Option or otherwise) the
substance  of  each  of  the  following  provisions:
                                       33
<PAGE>

a)   TERM. No Option shall be exercisable after the expiration of ten (10) years
     from  the  date  it was granted, or such longer or shorter period as may be
     provided  in  the  Option  Agreement.

b)   EXERCISE  PRICE.  The  exercise price of each Option shall be not less than
     eighty-five  percent (85%) of the Fair Market Value of the stock subject to
     the  Option  on  the  date  the  Option  is  granted.  Notwithstanding  the
     foregoing,  an Option may be granted with an exercise price lower than that
     set  forth  in the preceding sentence if such Option is granted pursuant to
     an assumption or substitution for another option in a manner satisfying the
     provisions  of  Section  424(a)  of  the  Code.

c)   CONSIDERATION.  The  purchase price of stock acquired pursuant to an Option
     shall  be  paid,  to  the  extent  permitted  by  applicable  statutes  and
     regulations, either (i) in cash at the time the Option is exercised or (ii)
     at  the discretion of the Board, by delivery to the Company of other Common
     Stock,  according  to  a  deferred  payment or other arrangement (which may
     include, without limiting the generality of the foregoing, the use of other
     Common  Stock)  with  the  Optionholder  or  in  any  other  form  of legal
     consideration  that may be acceptable to the Board; provided, however, that
     at  any  time  that the Company is incorporated in Delaware, payment of the
     Common  Stock's "par value," as defined in the Delaware General Corporation
     Law,  shall  not  be  made  by  deferred  payment.

     In  the  case  of  any  deferred  payment  arrangement,  interest  shall be
compounded  at  least  annually  and  shall  be  charged  at the minimum rate of
interest  necessary  to  avoid  the  treatment as interest, under any applicable
provisions  of the Code, of any amounts other than amounts stated to be interest
under  the  deferred  payment  arrangement.

d)   TRANSFERABILITY.  An  Option shall be transferable except by will or by the
     laws  of  descent  and  distribution  and  shall  be exercisable during the
     lifetime  of  the  Optionee  only  by  the  Optionee.  Notwithstanding  the
     foregoing  provisions  of  this  subsection  6(d),  the  Optionee  may,  by
     delivering  written  notice  to  the Company, in a form satisfactory to the
     Company,  designate  a  third  party  who, in the event of the death of the
     Optionee,  shall  thereafter  be  entitled  to  exercise  the  Option.

e)   VESTING GENERALLY. The total number of shares of Common Stock subject to an
     Option may, but need not, vest and therefore become exercisable in periodic
     installments  which  may, but need not, be equal. The Option may be subject
     to  such  other  terms  and  conditions on the time or times when it may be
     exercised  (which  may  be  based  on performance or other criteria) as the
     Board  may  deem  appropriate. The vesting provisions of individual Options
     may  vary. The provisions of this subsection 6(e) are subject to any Option
     provisions governing the minimum number of shares as to which an Option may
     be  exercised.
                                       34
<PAGE>

f)   TERMINATION  OF  CONTINUOUS  SERVICE. In the event an Optionee's Continuous
     Service  terminates  (other  than upon the Optionee's death or Disability),
     the  Optionholder  may  exercise  his or her Option (to the extent that the
     Optionholder was entitled to exercise it as of the date of termination) but
     only within such period of time ending on the earlier of (i) the date three
     (3)  months  following the termination of the Optionee's Continuous Service
     (or  such  longer  or shorter period specified in the Option Agreement), or
     (ii)  the  expiration  of the term of the Option as set forth in the Option
     Agreement.  If,  after such termination, the Optionholder does not exercise
     his  or  her  Option within the time specified in the Option Agreement, the
     Option  shall  terminate.

g)   EXTENSION  OF  TERMINATION  DATE.  An  Optionee's Option Agreement may also
     provide that if the exercise of the Option following the termination of the
     Optionee's  Continuous  Service  (other  than  upon the Optionee's death or
     Disability)  would be prohibited at any time solely because the issuance of
     shares  would  violate  the  registration requirements under the Securities
     Act,  then  the Option shall terminate on the earlier of (i) the expiration
     of  the  term  of  the  Option  set  forth  in  subsection 6(a) or (ii) the
     expiration  of  a  period  of three (3) months after the termination of the
     Optionee's Continuous Service during which the exercise of the Option would
     not  be  in  violation  of  such  registration  requirements.

h)   DISABILITY  OF  OPTIONEE.  In  the  event  an Optionee's Continuous Service
     terminates  as  a result of the Optionee's Disability, the Optionholder may
     exercise  his  or  her  Option  (to  the  extent  that the Optionholder was
     entitled  to  exercise  it  as  of  the date of such termination), but only
     within  such  period  of  time ending on the earlier of (i) the date twelve
     (12)  months  following  such termination (or such longer or shorter period
     specified  in  the  Option Agreement) or (ii) the expiration of the term of
     the Option as set forth in the Option Agreement. If, after termination, the
     Optionholder  does not exercise his or her Option within the time specified
     herein,  the  Option  shall  terminate.

i)   DEATH  OF  OPTIONEE.  In  the  event  (i)  an Optionee's Continuous Service
     terminates  as  a  result of the Optionee's death or (ii) the Optionee dies
     within  the  period  (if  any)  specified in the Option Agreement after the
     termination  of  the  Optionee's Continuous Service for a reason other than
     death, then the Option may be exercised (to the extent the Optionholder was
     entitled  to  exercise  the  Option  as  of  the  date  of  death)  by  the
     Optionholder  but  only  within the period ending on the earlier of (1) the
     date  twelve  (12)  months  following  the date of death (or such longer or
     shorter  period specified in the Option Agreement) or (2) the expiration of
     the  term  of  such  Option as set forth in the Option Agreement. If, after
     death,  the  Option  is not exercised within the time specified herein, the
     Option  shall  terminate.

j)   EARLY  EXERCISE.  The Option may, but need not, include a provision whereby
     the  Optionholder  may  elect  at any time before the Optionee's Continuous
     Service  terminates  to  exercise  the  Option as to any part or all of the
     shares  subject  to the Option prior to the full vesting of the Option. Any
     unvested shares so purchased may be subject to an unvested share repurchase
     option  in  favor  of  the  Company  or  to any other restriction the Board
     determines  to  be  appropriate.
                                       35
<PAGE>

7.   Covenants  of  the  Company.

a)   AVAILABILITY  OF SHARES. During the terms of the Options, the Company shall
     keep  available  at all times the number of shares of Common Stock required
     to  satisfy  such  Options.

b)   SECURITIES  LAW  COMPLIANCE.  The  Company  shall  seek to obtain from each
     regulatory  commission  or  agency  having  jurisdiction over the Plan such
     authority  as may be required to grant Options and to issue and sell shares
     of  Common Stock upon exercise of the Options; provided, however, that this
     undertaking  shall not require the Company to register under the Securities
     Act  the  Plan,  any Option or any stock issued or issuable pursuant to any
     such  Option. If, after reasonable efforts, the Company is unable to obtain
     from  any  such regulatory commission or agency the authority which counsel
     for  the  Company deems necessary for the lawful issuance and sale of stock
     under  the  Plan,  the  Company  shall  be  relieved from any liability for
     failure  to  issue  and sell stock upon exercise of such Options unless and
     until  such  authority  is  obtained.

8.   Use  of  Proceeds  from  Stock.

     Proceeds  from  the  sale  of  stock  pursuant  to Options shall constitute
general  funds  of  the  Company.

9.   Miscellaneous.

a)   ACCELERATION  OF EXERCISABILITY AND VESTING. The Board shall have the power
     to  accelerate  the  time  at which an Option may first be exercised or the
     time  during  which  an  Option or any part thereof will vest in accordance
     with  the  Plan,  notwithstanding  the provisions in the Option stating the
     time  at  which  it may first be exercised or the time during which it will
     vest.

b)   STOCKHOLDER RIGHTS. No Optionholder shall be deemed to be the holder of, or
     to  have  any of the rights of a holder with respect to, any shares subject
     to  such  Option  unless  and  until  such  Optionholder  has satisfied all
     requirements  for  exercise  of  the  Option  pursuant  to  its  terms.

c)   NO  EMPLOYMENT  OR  OTHER  SERVICE  RIGHTS.  Nothing  in  the  Plan  or any
     instrument  executed  or  Option granted pursuant thereto shall confer upon
     any  Optionee or Optionholder any right to continue to serve the Company or
     an  Affiliate  in the capacity in effect at the time the Option was granted
     (or  to  serve the Company in any other capacity) or shall affect the right
     of  the  Company  or  an  Affiliate  to  terminate (i) the employment of an
     Employee  with  or  without  notice  and  with or without cause or (ii) the
     service  of  a  Consultant  pursuant  to  the  terms  of  such Consultant's
     agreement  with  the  Company  or  an  Affiliate.
                                       36
<PAGE>

d)   INVESTMENT  ASSURANCES.  The  Company  may  require  an  Optionholder, as a
     condition  of  exercising  or acquiring stock under any Option, (i) to give
     written  assurances  satisfactory  to  the Company as to the Optionholder's
     knowledge and experience in financial and business matters and/or to employ
     a  purchaser  representative  reasonably satisfactory to the Company who is
     knowledgeable and experienced in financial and business matters and that he
     or  she  is  capable  of  evaluating,  alone or together with the purchaser
     representative,  the merits and risks of exercising the Option; and (ii) to
     give  written  assurances  satisfactory  to  the  Company  stating that the
     Optionholder  is  acquiring  the  stock  subject  to  the  Option  for  the
     Optionholder's own account and not with any present intention of selling or
     otherwise  distributing  the  stock.  The  foregoing  requirements, and any
     assurances  given  pursuant  to  such requirements, shall be inoperative if
     (iii)  the issuance of the shares upon the exercise or acquisition of stock
     under  the  Option  has  been  registered  under a then currently effective
     registration  statement  under  the  Securities  Act  or  (iv)  as  to  any
     particular  requirement, a determination is made by counsel for the Company
     that  such  requirement need not be met in the circumstances under the then
     applicable  securities laws. The Company may, upon advice of counsel to the
     Company,  place legends on stock certificates issued under the Plan as such
     counsel  deems  necessary or appropriate in order to comply with applicable
     securities  laws,  including,  but  not limited to, legends restricting the
     transfer  of  the  stock.

e)   WITHHOLDING  OBLIGATIONS.  To the extent provided by the terms of an Option
     Agreement,  the  Optionholder  may  satisfy any federal, state or local tax
     withholding  obligation  relating  to  the exercise or acquisition of stock
     under an Option by any of the following means (in addition to the Company's
     right  to  withhold  from  any compensation paid to the Optionholder by the
     Company)  or  by a combination of such means: (i) tendering a cash payment;
     (ii)  authorizing  the  Company  to  withhold shares from the shares of the
     Common  Stock  otherwise  issuable  to  the Optionholder as a result of the
     exercise  or  acquisition of stock under the Option; or (iii) delivering to
     the  Company  owned  and  unencumbered  shares  of  the  Common  Stock.

f)   REPRICING  OF  OPTIONS. The Board or the Committee shall have the authority
     to  effect,  at  any  time  and  from time to time (i) the repricing of any
     outstanding  Options  under  the  Plan  and/or (ii) with the consent of the
     affected Optionholders, the cancellation of any outstanding Options and the
     grant  in  substitution therefor of new Options under the Plan covering the
     same or different numbers of shares of Common Stock, but having an exercise
     price  per share not less than eighty-five percent (85%) of the Fair Market
     Value.
                                       37
<PAGE>

10.  Adjustments  upon  Changes  in  Stock.

a)   CAPITALIZATION  ADJUSTMENTS.  If any change is made in the stock subject to
     the Plan, or subject to any Option, without the receipt of consideration by
     the  Company  (through  merger,  consolidation,  reorganization,
     recapitalization,  reincorporation,  stock  dividend,  dividend in property
     other  than cash, stock split, liquidating dividend, combination of shares,
     exchange  of shares, change in corporate structure or other transaction not
     involving  the  receipt  of consideration by the Company), the Plan will be
     appropriately  adjusted  in  the class(es) and maximum number of securities
     subject  to  the  Plan  pursuant  to  subsection  4(a), and the outstanding
     Options  will  be  appropriately  adjusted  in  the class(es) and number of
     securities  and  price  per  share  of  stock  subject  to such outstanding
     Options.  Such adjustments shall be made by the Board, the determination of
     which  shall  be  final,  binding  and  conclusive.  (The conversion of any
     convertible securities of the Company shall not be treated as a transaction
     "without  receipt  of  consideration"  by  the  Company.)

b)   CHANGE  IN CONTROL. In the event of: (1) a dissolution, liquidation or sale
     of  substantially  all  of  the  assets  of  the  Company;  (2) a merger or
     consolidation in which the Company is not the surviving corporation; or (3)
     a  reverse merger in which the Company is the surviving corporation but the
     shares  of the Company's common stock outstanding immediately preceding the
     merger  are  converted by virtue of the merger into other property, whether
     in  the form of securities, cash or otherwise, then to the extent permitted
     by  applicable  law: (i) any surviving corporation shall assume any Options
     outstanding  under  the  Plan or shall substitute similar Options for those
     outstanding  under  the  Plan,  or (ii) such Options shall continue in full
     force  and effect. In the event any surviving corporation refuses to assume
     or  continue  such  Options,  or  to  substitute  similar options for those
     outstanding  under  the Plan, then, with respect to Options held by persons
     then  performing  services as Employees, Directors or Consultants, the time
     during  which  such  Options  may be exercised shall be accelerated and the
     Options  terminated  if  not  exercised  prior  to  such  event.

11.  Amendment  of  the  Plan  and  Options.

a)   AMENDMENT  OF PLAN. The Board at any time, and from time to time, may amend
     the  Plan.

b)   STOCKHOLDER  APPROVAL.  The  Board  may, in its sole discretion, submit any
     amendment  to  the  Plan  for  stockholder  approval.

c)   NO  IMPAIRMENT  OF RIGHTS. Rights under any Option granted before amendment
     of  the  Plan  shall  not  be  impaired by any amendment of the Plan unless
                                       38
<PAGE>

     (i)  the  Company  requests  the  consent  of the Optionholder and (ii) the
          Optionholder  consents  in  writing.

d)   AMENDMENT  OF  OPTIONS.  The  Board at any time, and from time to time, may
     amend  the  terms  of  any one or more Options; provided, however, that the
     rights  under any Option shall not be impaired by any such amendment unless
     (i)  the  Company  requests  the  consent  of the Optionholder and (ii) the
     Optionholder  consents  in  writing.

12.  Termination  or  Suspension  of  the  Plan.

a)   PLAN  TERM. The Board may suspend or terminate the Plan at any time. Unless
     sooner terminated, the Plan shall terminate on the date ten (10) years from
     the date of adoption by the Board. No Options may be granted under the Plan
     while  the  Plan  is  suspended  or  after  it  is  terminated.

b)   NO  IMPAIRMENT  OF  RIGHTS. Rights and obligations under any Option granted
     while  the  Plan  is  in  effect  shall  not  be  impaired by suspension or
     termination  of  the  Plan,  except  with  the  written  consent  of  the
     Optionholder.

13.  Effective  Date  of  Plan.

     The  Plan  shall  become  effective  on the date it is adopted by the Board


                                       39
<PAGE>




</TEXT>
</DOCUMENT>
<DOCUMENT>
<TYPE>EX-99.3
<SEQUENCE>6
<FILENAME>grantauth_96.txt
<TEXT>

Exhibit  99.3

     NONSTATUTORY  STOCK  OPTION


 FIRSTNAME   LASTNAME  ,

     SBE,  Inc.  (the  "Company"),  pursuant  to its 1996 Stock Option Plan (the
"Plan"),  has  granted  to  you, the optionee named above, an option to purchase
shares  of  the common stock of the Company ("Common Stock"). This option is not
intended  to  qualify  and  will  not  be treated as an "incentive stock option"
within  the  meaning  of  Section  422  of the Internal Revenue Code of 1986, as
amended  (the  "Code").

     The  grant  hereunder  is  in  connection  with  and  in furtherance of the
Company's compensatory benefit plan for participation of the Company's employees
(including  officers),  directors  or  consultants.

     The  details  of  your  option  are  as  follows:

1.   TOTAL  NUMBER  OF SHARES SUBJECT TO THIS OPTION. The total number of shares
     of  Common  Stock  subject  to  this  option  is  TOTALSHARES  .

2.   VESTING.  Subject  to the limitations contained herein, 1/4TH OF THE SHARES
     VEST ONE YEAR AFTER THE VESTING COMMENCEMENT DATE, AND 1/48TH OF THE SHARES
     VEST  MONTHLY  THEREAFTER  OVER  THE NEXT THREE YEARS, until either (i) you
     cease  to  provide  services  to  the  Company for any reason, or (ii) this
     option  becomes  fully  vested.

3.   EXERCISE  PRICE  AND  METHOD  OF  PAYMENT.

(A)  EXERCISE  PRICE.  The  exercise price of this option is $ PRICE per -------
     share, being not less than 85% of the fair market value of the Common Stock
     on  the  date  of  grant  of  this  option.

(B)  METHOD  OF  PAYMENT. Payment of the exercise price per share is due in full
     upon  exercise  of all or any part of each installment which has accrued to
     you.  You  may  elect,  to  the extent permitted by applicable statutes and
     regulations,  to  make  payment  of  the  exercise  price  under one of the
     following  alternatives:

     (i)Payment of the exercise price per share in cash (including check) at the
          time  of  exercise;

     (ii)Payment  pursuant  to  a  program  developed  under  Regulation  T  as
          promulgated  by the Federal Reserve Board which, prior to the issuance
          of  Common  Stock, results in either the receipt of cash (or check) by
          the  Company  or  the  receipt  of irrevocable instructions to pay the
          aggregate  exercise  price  to  the  Company  from the sales proceeds;

     (iii)Provided  that  at  the time of exercise the Company's Common Stock is
          publicly  traded  and  quoted  regularly  in  the Wall Street Journal,
          payment  by delivery of already-owned shares of Common Stock, held for
          the  period  required  to  avoid  a  charge  to the Company's reported
          earnings,  and owned free and clear of any liens, claims, encumbrances
          or  security interests, which Common Stock shall be valued at its fair
          market  value  on  the  date  of  exercise;  or
                                       40
<PAGE>

     (iv)Payment  by  a  combination  of  the  methods  of  payment permitted by
          subparagraph  3(b)(i)  through  3(b)(iii)  above.

4.   WHOLE  SHARES;  MINIMUM  SHARES  EXERCISABLE.

(A)  This  option  may  not  be  exercised  for any number of shares which would
     require  the  issuance  of  anything  other  than  whole  shares.

(B)  The  minimum  number  of  shares  with  respect to which this option may be
     exercised  at  any one time is one hundred (100) shares, except that (i) as
     to that number of shares to which it is exercisable under the provisions of
     paragraph  2  of  this  option, if fewer than one hundred (100) shares, the
     number  of  such  shares  exercisable shall be the minimum number of shares
     that  are vested thereunder, and (ii) with respect to the final exercise of
     this  option  this  minimum  shall  not  apply.

5.   SECURITIES  LAW  COMPLIANCE.  Notwithstanding  anything  to  the  contrary
     contained  herein,  this  option  may  not  be  exercised unless the shares
     issuable upon exercise of this option are then registered under the Act or,
     if  such shares are not then so registered, the Company has determined that
     such  exercise  and  issuance  would  be  exempt  from  the  registration
     requirements  of  the  Act.

6.   TERM.  The  term  of  this option commences on DATE1, the date of grant and
     expires  on DATE, 2008, (the "Expiration Date," which date shall be no more
     than  ten  (10)  years  from  the date this option is granted), unless this
     option  expires  sooner  as set forth below or in the Plan. In no event may
     this option be exercised on or after the Expiration Date. This option shall
     terminate  prior  to the Expiration Date as follows: three (3) months after
     the  termination  of  your  Continuous  Status  as an Employee, Director or
     Consultant  with  the Company or an Affiliate of the Company for any reason
     or  for  no  reason  unless:

(a)  such  termination  of  Continuous  Status  as  an  Employee,  Director  or
     Consultant  is  due  to  your  permanent  and  total disability (within the
     meaning  of Section 422(c)(6) of the Code), in which event the option shall
     expire on the earlier of the Expiration Date set forth above or twelve (12)
     months  following  such  termination  of  Continuous Status as an Employee,
     Director  or  Consultant;  or

(b)  such  termination  of  Continuous  Status  as  an  Employee,  Director  or
     Consultant  is  due  to  your  death  or your death occurs within three (3)
     months  following your termination for any other reason, in which event the
     option  shall  expire on the earlier of the Expiration Date set forth above
     or  eighteen  (18)  months  after  your  death;  or

(c)  during  any  part  of  such  three  (3)  month  period  the  option  is not
     exercisable solely because of the condition set forth in paragraph 5 above,
     in  which  event  the  option  shall  not  expire  until the earlier of the
     Expiration Date set forth above or until it shall have been exercisable for
     an aggregate period of three (3) months after the termination of Continuous
     Status  as  an  Employee,  Director  or  Consultant;  or

(d)  exercise  of  the  option within three (3) months after termination of your
     Continuous  Status  as an Employee, Director or Consultant with the Company
     or with an Affiliate of the Company would result in liability under section
     16(b)  of the Securities Exchange Act of 1934 (the "Exchange Act), in which
     case  the  option will expire on the earlier of (i) the Expiration Date set
     forth  above,  (ii)  the  tenth  (10th)  day after the last date upon which
     exercise  would  result  in  such liability or (iii) six (6) months and ten
     (10)  days  after the termination of your Continuous Status as an Employee,
     Director  or  Consultant  with  the Company or an Affiliate of the Company.

     However,  this  option may be exercised following termination of Continuous
Status  as  an Employee, Director or Consultant only as to that number of shares
as  to  which it was exercisable on the date of termination of Continuous Status
as  an  Employee,  Director or Consultant under the provisions of paragraph 2 of
this  option.
                                       41
<PAGE>

7.   EXERCISE.

(a)  This  option may be exercised, to the extent specified above, by delivering
     a  notice  of  exercise (in a form designated by the Company) together with
     the exercise price to the Secretary of the Company, or to such other person
     as  the Company may designate, during regular business hours, together with
     such  additional  documents  as  the  Company  may then require pursuant to
     subsection  6(f)  of  the  Plan.

(b)  By  exercising  this  option  you  agree  that:

     (i)  as  a  precondition  to the completion of any exercise of this option,
          the  Company may require you to enter an arrangement providing for the
          cash  payment  by you to the Company of any tax withholding obligation
          of  the Company arising by reason of: (1) the exercise of this option;
          (2)  the  lapse  of  any  substantial  risk of forfeiture to which the
          shares  are subject at the time of exercise; or (3) the disposition of
          shares  acquired  upon such exercise. You also agree that any exercise
          of this option has not been completed and that the Company is under no
          obligation  to issue any Common Stock to you until such an arrangement
          is  established  or  the  Company's  tax  withholding  obligations are
          satisfied,  as  determined  by  the  Company;  and


8.   TRANSFERABILITY.  This option is not transferable, except by will or by the
     laws  of descent and distribution, and is exercisable during your life only
     by  you  or  pursuant to a qualified domestic relations order as satisfying
     the  requirements  of  Rule  16b-3  of  the Exchange Act (a "QDRO"), and is
     exercisable  during  your  life  only  by you or a transferee pursuant to a
     QDRO.  Notwithstanding  the  foregoing, by delivering written notice to the
     Company,  in  a form satisfactory to the Company, you may designate a third
     party  who,  in  the  event  of your death, shall thereafter be entitled to
     exercise  this  option.

9.   OPTION  NOT  A  SERVICE CONTRACT. This option is not an employment contract
     and  nothing in this option shall be deemed to create in any way whatsoever
     any obligation on your part to continue in the employ of the Company, or of
     the  Company  to  continue  your  employment with the Company. In addition,
     nothing  in  this option shall obligate the Company or any Affiliate of the
     Company, or their respective shareholders, Board of Directors, officers, or
     employees  to  continue any relationship which you might have as a Director
     or  Consultant  for  the  Company  or  Affiliate  of  the  Company.

10.  NOTICES. Any notices provided for in this option or the Plan shall be given
     in  writing  and  shall be deemed effectively given upon receipt or, in the
     case  of  notices  delivered  by  the  Company  to you, five (5) days after
     deposit in the United States mail, postage prepaid, addressed to you at the
     address specified below or at such other address as you hereafter designate
     by  written  notice  to  the  Company.
                                       42
<PAGE>

11.  GOVERNING  PLAN  DOCUMENT.  This option is subject to all the provisions of
     the  Plan, a copy of which is attached hereto and its provisions are hereby
     made  a part of this option, including without limitation the provisions of
     Section 6 of the Plan relating to option provisions, and is further subject
     to  all  interpretations,  amendments, rules and regulations which may from
     time  to time be promulgated and adopted pursuant to the Plan. In the event
     of  any  conflict  between  the  provisions of this option and those of the
     Plan,  the  provisions  of  the  Plan  shall  control.

      Dated__________
                              Very  truly  yours,



                              By________________________________________________
                              Duly authorized  on  behalf  of  the  Board  of
                                   Directors


ATTACHMENTS:

     SBE,  Inc.  1996  Stock  Option  Plan
     Notice  of  Exercise

The  undersigned:

          Acknowledges  receipt  of  the  foregoing  option  and the attachments
referenced  therein and understands that all rights and liabilities with respect
to  this  option  are  set  forth  in  the  option  and  the  Plan;  and

          Acknowledges  that  as  of  the  date of grant of this option, it sets
forth  the entire understanding between the undersigned optionee and the Company
and  its  Affiliates  regarding  the  acquisition  of  stock  in the Company and
supersedes  all  prior  oral  and  written  agreements  on that subject with the
exception of (i) the options previously granted and delivered to the undersigned
under stock option plans of the Company, and (ii) the following agreements only:

     NONE      _________
               (Initial)

     OTHER
               ___________________________________
               ___________________________________
               ___________________________________



                              _________________________________________
                              OPTIONEE


                              Address: ________________________________
                                       ________________________________


                                       43
<PAGE>




</TEXT>
</DOCUMENT>
<DOCUMENT>
<TYPE>EX-99.4
<SEQUENCE>7
<FILENAME>grantauth_98.txt
<TEXT>

Exhibit  99.4
                       1998 NON-OFFICER STOCK OPTION PLAN


 FIRSTNAME   LASTNAME  ,

     SBE,  Inc.  (the  "Company"), pursuant to its 1998 Non-Officer Stock Option
Plan  (the  "Plan"),  has granted to you, the optionee named above, an option to
purchase  shares  of  the  common  stock  of the Company ("Common Stock").  This
option is not intended to qualify and will not be treated as an "incentive stock
option"  within the meaning of Section 422 of the Internal Revenue Code of 1986,
as  amended  (the  "Code").

     The  grant  hereunder  is  in  connection  with  and  in furtherance of the
Company's compensatory benefit plan for participation of the Company's employees
(excluding  officers).

     The  details  of  your  option  are  as  follows:

1.   TOTAL  NUMBER  OF SHARES SUBJECT TO THIS OPTION. The total number of shares
     of  Common  Stock  subject  to  this  option  is  TOTALSHARES  .

2.   VESTING.  Subject  to the limitations contained herein, 1/4TH OF THE SHARES
     VEST ONE YEAR AFTER THE VESTING COMMENCEMENT DATE, AND 1/48TH OF THE SHARES
     VEST  MONTHLY  THEREAFTER  OVER  THE NEXT THREE YEARS, until either (i) you
     cease  to  provide  services  to  the  Company for any reason, or (ii) this
     option  becomes  fully  vested.

3.   EXERCISE  PRICE  AND  METHOD  OF  PAYMENT.

(A)  EXERCISE  PRICE.  The  exercise  price of this option is $ ______per share,
     being not less than 85% of the fair market value of the Common Stock on the
     date  of  grant  of  this  option.

(B)  METHOD  OF  PAYMENT. Payment of the exercise price per share is due in full
     upon  exercise  of all or any part of each installment which has accrued to
     you.  You  may  elect,  to  the extent permitted by applicable statutes and
     regulations,  to  make  payment  of  the  exercise  price  under one of the
     following  alternatives:

     (i)Payment of the exercise price per share in cash (including check) at the
          time  of  exercise;

     (ii)Payment  pursuant  to  a  program  developed  under  Regulation  T  as
          promulgated  by the Federal Reserve Board which, prior to the issuance
          of  Common  Stock, results in either the receipt of cash (or check) by
          the  Company  or  the  receipt  of irrevocable instructions to pay the
          aggregate  exercise  price  to  the  Company  from the sales proceeds;

     (iii)Provided  that  at  the time of exercise the Company's Common Stock is
          publicly  traded  and  quoted  regularly  in  the Wall Street Journal,
          payment  by delivery of already-owned shares of Common Stock, held for
          the  period  required  to  avoid  a  charge  to the Company's reported
          earnings,  and owned free and clear of any liens, claims, encumbrances
          or  security interests, which Common Stock shall be valued at its fair
          market  value  on  the  date  of  exercise;  or

     (iv)Payment  by  a  combination  of  the  methods  of  payment permitted by
          subparagraph  3(b)(i)  through  3(b)(iii)  above.

                                       44
<PAGE>

4.   WHOLE  SHARES;  MINIMUM  SHARES  EXERCISABLE.

(A)  This  option  may  not  be  exercised  for any number of shares which would
     require  the  issuance  of  anything  other  than  whole  shares.

(B)  The  minimum  number  of  shares  with  respect to which this option may be
     exercised  at  any one time is one hundred (100) shares, except that (i) as
     to that number of shares to which it is exercisable under the provisions of
     paragraph  2  of  this  option, if fewer than one hundred (100) shares, the
     number  of  such  shares  exercisable shall be the minimum number of shares
     that  are vested thereunder, and (ii) with respect to the final exercise of
     this  option  this  minimum  shall  not  apply.

5.   SECURITIES  LAW  COMPLIANCE.  Notwithstanding  anything  to  the  contrary
     contained  herein,  this  option  may  not  be  exercised unless the shares
     issuable upon exercise of this option are then registered under the Act or,
     if  such shares are not then so registered, the Company has determined that
     such  exercise  and  issuance  would  be  exempt  from  the  registration
     requirements  of  the  Act.

6.   TERM. The term of this option commences on _______, 2001, the date of grant
     and  expires  on  DATE, 2008,(the "Expiration Date," which date shall be no
     more than ten (10) years from the date this option is granted), unless this
     option  expires  sooner  as set forth below or in the Plan. In no event may
     this option be exercised on or after the Expiration Date. This option shall
     terminate  prior  to the Expiration Date as follows: three (3) months after
     the  termination  of  your  Continuous  Status  as an Employee, Director or
     Consultant  with  the Company or an Affiliate of the Company for any reason
     or  for  no  reason  unless:

(a)  such  termination  of  Continuous  Status  as  an  Employee,  Director  or
     Consultant  is  due  to  your  permanent  and  total disability (within the
     meaning  of Section 422(c)(6) of the Code), in which event the option shall
     expire on the earlier of the Expiration Date set forth above or twelve (12)
     months  following  such  termination  of  Continuous Status as an Employee,
     Director  or  Consultant;  or

(b)  such  termination  of  Continuous  Status  as  an  Employee,  Director  or
     Consultant  is  due  to  your  death  or your death occurs within three (3)
     months  following your termination for any other reason, in which event the
     option  shall  expire on the earlier of the Expiration Date set forth above
     or  eighteen  (18)  months  after  your  death;  or

(c)  during  any  part  of  such  three  (3)  month  period  the  option  is not
     exercisable solely because of the condition set forth in paragraph 5 above,
     in  which  event  the  option  shall  not  expire  until the earlier of the
     Expiration Date set forth above or until it shall have been exercisable for
     an aggregate period of three (3) months after the termination of Continuous
     Status  as  an  Employee,  Director  or  Consultant;  or

(d)  exercise  of  the  option within three (3) months after termination of your
     Continuous  Status  as an Employee, Director or Consultant with the Company
     or with an Affiliate of the Company would result in liability under section
     16(b)  of the Securities Exchange Act of 1934 (the "Exchange Act), in which
     case  the  option will expire on the earlier of (i) the Expiration Date set
     forth  above,  (ii)  the  tenth  (10th)  day after the last date upon which
     exercise  would  result  in  such liability or (iii) six (6) months and ten
     (10)  days  after the termination of your Continuous Status as an Employee,
     Director  or  Consultant  with  the Company or an Affiliate of the Company.

     However,  this  option may be exercised following termination of Continuous
Status  as  an Employee, Director or Consultant only as to that number of shares
as  to  which it was exercisable on the date of termination of Continuous Status
as  an  Employee,  Director or Consultant under the provisions of paragraph 2 of
this  option.

                                       45
<PAGE>

7.   EXERCISE.

(a)  This  option may be exercised, to the extent specified above, by delivering
     a  notice  of  exercise (in a form designated by the Company) together with
     the exercise price to the Secretary of the Company, or to such other person
     as  the Company may designate, during regular business hours, together with
     such  additional  documents  as  the  Company  may then require pursuant to
     subsection  6(f)  of  the  Plan.

(b)  By  exercising  this  option  you  agree  that:

     (i)  as  a  precondition  to the completion of any exercise of this option,
          the  Company may require you to enter an arrangement providing for the
          cash  payment  by you to the Company of any tax withholding obligation
          of  the Company arising by reason of: (1) the exercise of this option;
          (2)  the  lapse  of  any  substantial  risk of forfeiture to which the
          shares  are subject at the time of exercise; or (3) the disposition of
          shares  acquired  upon such exercise. You also agree that any exercise
          of this option has not been completed and that the Company is under no
          obligation  to issue any Common Stock to you until such an arrangement
          is  established  or  the  Company's  tax  withholding  obligations are
          satisfied,  as  determined  by  the  Company;  and


8.   TRANSFERABILITY.  This option is not transferable, except by will or by the
     laws  of descent and distribution, and is exercisable during your life only
     by  you  or  pursuant to a qualified domestic relations order as satisfying
     the  requirements  of  Rule  16b-3  of  the Exchange Act (a "QDRO"), and is
     exercisable  during  your  life  only  by you or a transferee pursuant to a
     QDRO.  Notwithstanding  the  foregoing, by delivering written notice to the
     Company,  in  a form satisfactory to the Company, you may designate a third
     party  who,  in  the  event  of your death, shall thereafter be entitled to
     exercise  this  option.

9.   OPTION  NOT  A  SERVICE CONTRACT. This option is not an employment contract
     and  nothing in this option shall be deemed to create in any way whatsoever
     any obligation on your part to continue in the employ of the Company, or of
     the  Company  to  continue  your  employment with the Company. In addition,
     nothing  in  this option shall obligate the Company or any Affiliate of the
     Company, or their respective shareholders, Board of Directors, officers, or
     employees  to  continue any relationship which you might have as a Director
     or  Consultant  for  the  Company  or  Affiliate  of  the  Company.


10.  NOTICES. Any notices provided for in this option or the Plan shall be given
     in  writing  and  shall be deemed effectively given upon receipt or, in the
     case  of  notices  delivered  by  the  Company  to you, five (5) days after
     deposit in the United States mail, postage prepaid, addressed to you at the
     address specified below or at such other address as you hereafter designate
     by  written  notice  to  the  Company.
                                       46
<PAGE>

11.  GOVERNING  PLAN  DOCUMENT.  This option is subject to all the provisions of
     the  Plan, a copy of which is attached hereto and its provisions are hereby
     made  a part of this option, including without limitation the provisions of
     Section 6 of the Plan relating to option provisions, and is further subject
     to  all  interpretations,  amendments, rules and regulations which may from
     time  to time be promulgated and adopted pursuant to the Plan. In the event
     of  any  conflict  between  the  provisions of this option and those of the
     Plan,  the  provisions  of  the  Plan  shall  control.

      Date ________

                              Very  truly  yours,


                              By______________________________________________
                                   Duly authorized  on  behalf  of  the Board of
                                        Directors


ATTACHMENTS:

     SBE,  Inc.  1998  Non-Officer  Stock  Option  Plan  document


The  undersigned:

          Acknowledges  receipt  of  the  foregoing  option  and the attachments
referenced  therein and understands that all rights and liabilities with respect
to  this  option  are  set  forth  in  the  option  and  the  Plan;  and

          Acknowledges  that  as  of  the  date of grant of this option, it sets
forth  the entire understanding between the undersigned optionee and the Company
and  its  Affiliates  regarding  the  acquisition  of  stock  in the Company and
supersedes  all  prior  oral  and  written  agreements  on that subject with the
exception of (i) the options previously granted and delivered to the undersigned
under stock option plans of the Company, and (ii) the following agreements only:

     NONE  ____________
           (Initial)

     OTHER
           ____________________________________
           ____________________________________
           ____________________________________



                              _____________________________________________
                              OPTIONEE  SIGNATURE





</TEXT>
</DOCUMENT>
</SEC-DOCUMENT>
-----END PRIVACY-ENHANCED MESSAGE-----
