As filed with the Securities and Exchange Commission on September 19, 2000
                                                      REGISTRATION NO.

                        SECURITIES AND EXCHANGE COMMISSION
                            WASHINGTON, D.C. 20549

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

                          DYNASIL CORPORATION OF AMERICA
              (Exact name of registrant as specified in its charter)


        NEW JERSEY                                    22-1734088
(State or other jurisdiction of           (I.R.S. Employer identification No.)
incorporation or organization)

                                   385 COOPER ROAD
                            WEST BERLIN, NEW JERSEY  08091
                        (Address of principal executive offices)

                            1996 STOCK INCENTIVE PLAN
                            1999 STOCK INCENTIVE PLAN
                           EMPLOYEE STOCK PURCHASE PLAN
                         --------------------------------
                              (Full title of the Plan)

                         John Kane, Chief Financial Officer
                           Dynasil Corporation of America
                                385 Cooper Road
                          West Berlin, New Jersey  08091
                                 (856) 797-4600
                          --------------------------------
(Name, address and telephone number, including area code, of agent for service)

                                   with a copy to:

                             STEPHEN M. ROBINSON, ESQ.
                             STEPHEN M. ROBINSON, P.A.
                                172 Tuckerton Road
                            Medford, New Jersey  08055
                                 (856) 596-5530

                         CALCULATION OF REGISTRATION FEE
- -------------------------------------------------------------------------------
                                      Proposed       Proposed
                                      Maximum        Maximum
Title of Securities      Amount       Offering       Aggregate    Amount of
 to be Registered        to be          Price        Offering     Registration
                       Registered     Per Unit       Price        Fee
- -------------------------------------------------------------------------------
Common Stock, $.0005
  par value (2)(3)     58,723 shares    $   1.50  (1) $ 88,085     $ 23.26
Common Stock, $.0005
  par value (2)(4)    450,000 shares    $   1.50  (1)  675,000     $178.20
Common Stock, $.0005
  par value     (5)    94,261 shares    $   1.28 (6)  $120,654     $ 31.85
Common Stock, $.0005
  par value     (7)     9,274 shares    $    .25      $ 2,319     $    .62

TOTAL REGISTRATION FEE                                            $ 233.93
- -------------------------------------------------------------------------------

(1)  Estimated in accordance with Rule 457(h) solely for the purpose of
     calculating the registration fee on the basis of $1.50 per share (the
     average of the high and low prices of the Registrant's common stock as
     reported on the OTC Bulletin Board on September 19, 2000) for the
     58,723 shares reserved for issuance under the 1996 Stock Incentive
     Plan ("1996 Plan") and for 450,000 shares reserved for issuance
     under the 1999 Stock Incentive Plan ("1999 Plan").

(2)  The amount being registered represents the maximum number of shares of
     Common Stock that may be issued by the Registrant upon the exercise of
     options and other stock-based awards granted or which may be granted
     under our 1996 and 1999 Plan.  Pursuant to Rule 416, there are also being
     registered additional shares of Common Stock as may become issuable
     pursuant to the anti-dilution provisions of such plan.

(3)  Shares to be issued  pursuant to the Dynasil Corporation of America
     1996 Stock Incentive Plan

(4)  Shares to be issued  pursuant to the Dynasil Corporation of America
     1999 Stock Incentive Plan

(5)  Shares to be issued  pursuant to the Dynasil Corporation of America
     Employee Stock Purchase Plan

(6)  Estimated in accordance with Rule 457(h) solely for the purpose of
     calculating the registration fee on the basis of 85% of $1.50 per share
    (the average of the high and low prices of the Registrant's common stock
     as reported on the OTC Bulletin Board on September 19, 2000) for the
     94,261 shares reserved for issuance under the Employee Stock
     Purchase Plan.

(7)  Shares previously issued pursuant to the Dynasil Corporation of America
     Employee Stock Purchase Plan at $.25 per share.

SUBJECT TO COMPLETION, DATED September 19, 2000 REOFFER PROSPECTUS 650,000 SHARES DYNASIL CORPORATION OF AMERICA Common Stock ($.0005 par value) This Prospectus relates to the reoffer and resale by certain selling shareholders of shares of our Common Stock, $.0005 par value, that have been issued as restricted stock pursuant to the Employee Stock Purchase Plan, and that may be issued by us to the Selling Shareholders upon (i) the exercise of outstanding stock options granted pursuant to our 1996 Stock Incentive Plan; the exercise of outstanding stock options granted pursuant to our 1999 Stock Incentive Plan; and (iii) the purchase of our stock by our employees pursuant to our Employee Stock Purchase Plan. With respect to the shares that may be issued to any of the selling shareholders or additional persons who may be deemed affiliates, this Prospectus also relates to certain shares underlying options which have not as of this date been granted. If and when such options are granted, we will distribute a Prospectus Supplement. The shares are being reoffered and resold for the account of the selling shareholders and we will not receive any of the proceeds from the resale of the shares. It is anticipated that the resale of their shares may be effected from time to time in one or more transactions on the open market, or in privately negotiated transactions or otherwise at market prices prevailing at the time of the sale or at prices otherwise negotiated. See "Plan of Distribution." We will bear all expenses in connection with the preparation of this Prospectus. Our common stock is traded on the OTC Bulletin Board under the symbol "DYSL." On September 19, 2000, the closing bid price for the common stock, as reported by the OTC Bulletin Board was $1.4375. Neither the Securities and Exchange Commission nor any state securities commission has determined whether this prospectus is truthful or complete. They have not made, nor will they make, any determination as to whether anyone should buy these securities. Any representation to the contrary is a criminal offense The date of this Prospectus is September 19, 2000. -1-

WHERE YOU CAN FIND MORE INFORMATION We file annual, quarterly and special reports, proxy statements and other information with the Securities and Exchange Commission (the "SEC"). You may read and copy any document we file at the SEC's public reference room located at Judiciary Plaza, 450 Fifth Street, N.W., Washington, D.C. 20549. You may obtain further information on the operation of the public reference room by calling the SEC at 1-800-SEC-0330. Our SEC filings are also available to the public over the Internet at the SEC's web site at http://www.sec.gov. You may also request copies of such documents, upon payment of a duplicating fee, by writing to the SEC at 450 Fifth Street, N.W., Washington, D.C. 20549. TABLE OF CONTENTS WHERE YOU CAN FIND MORE INFORMATION........................................ 2 INCORPORATION BY REFERENCE................................................. 3 GENERAL INFORMATION........................................................ 4 RISK FACTORS............................................................... 6 USE OF PROCEEDS............................................................ 11 SELLING SHAREHOLDERS....................................................... 11 PLAN OF DISTRIBUTION....................................................... 12 LEGAL MATTERS.............................................................. 12 EXPERTS.................................................................... 12 ADDITIONAL INFORMATION..................................................... 12 -2-

INCORPORATION OF CERTAIN DOCUMENTS BY REFERENCE The SEC allows us to "incorporate by reference" the information we file with them, which means that we can disclose important information to you by referring you to those documents. The information we incorporate by reference is considered to be a part of this prospectus and information that we file later with the SEC will automatically update and replace this information. We incorporate by reference the documents listed below and any future filings we make with the SEC under Sections 13(a), 13(c), 14 or 15(d) of the Securities Exchange Act of 1934, as amended (the "Exchange Act"): (a) The Corporation's Annual Report on Form 10-KSB for the fiscal year ended September 30, 1999 (b) The Corporation's proxy statement dated December 23, 1999, filed with the Securities and Exchange Commission on December 29, 1999 (c) The Corporation's Quarterly Reports on Form 10-QSB for the quarters ended December 31, 1999, March 31, 2000 and June 30, 2000; (d) Registrant's Form 10-SB Registration Statement filed October 1, 1999 (e) All documents subsequently filed by the registrant pursuant to Sections 13(a), 13(c), 14 and 15(d) of the Securities Exchange Act of 1934, as amended, prior to the filing of a post-effective amendment which indicates that all securities offered have been sold or which deregisters all securities then remaining unsold, shall be deemed to be incorporated by reference in this Registration Statement and to be a part hereof from the date of filing of such documents. Any statement contained herein or in a document, all or a portion of which is incorporated by reference herein shall be deemed to be modified or superseded for purposes of this Registration Statement to the extent that a statement contained in any subsequently filed document which also is or is deemed to be incorporated by reference herein modifies or supersedes such statement. Any such statement so modified or superseded shall not be deemed, except as so modified or superseded, to constitute a part of this Registration Statement. You may request a copy of these filings (excluding the exhibits to such filings which we have not specifically incorporated by reference in such filings) at no cost, by writing or telephoning us at the following address: Dynasil Corporation of America 385 Cooper Road West Berlin, NJ 08091 Attention: John Kane, Chief Financial Officer (856) 767-4600 ----------------- No dealer, salesman or other person has been authorized to give any information or to make any representations other than those contained in this Prospectus in connection with the offer made hereby, and, if given or made, such information or representations must not be relied upon as having been authorized by us or any selling shareholder. This Prospectus does not constitute an offer to sell, or a solicitation of an offer to buy, the securities offered hereby to any person in any state or other jurisdiction in which such offer or solicitation is unlawful. The delivery of this Prospectus at any time does not imply that information contained herein is correct as of any time subsequent to its date. -3-

GENERAL INFORMATION PROSPECTUS SUMMARY We have provided you with a summary of important information on our business. You should read all the information in this prospectus for a more complete understanding. Some of the information has been incorporated from our SEC filings. You can obtain copies of this incorporated information from us without charge as described beginning on page 3. Please be sure to read "Risk Factors" beginning on page 6 for a description of the high risk involved in acquiring our shares. THE COMPANY Principal Executive Dynasil Corporation of America Offices: 385 Cooper Road West Berlin, New Jersey 08091 (856) 767-4600 Our Business: Dynasil Corporation of America ("Dynasil", "we", or the "Company") was incorporated in the State of New Jersey on October 20, 1960. Business We are primarily engaged in the manufacturing and marketing of customized synthetic fused silica products. We also distribute fused quartz material that we obtain from a variety of sources. Our products are used primarily as components of optical instruments, lasers, analytical instruments, semiconductor/electronic devices, spacecraft/aircraft components, and in devices for the energy industry. These include: o Optical components - lenses, prisms, reflectors, mirrors, filters, optical flats o Lasers - Beam Splitters, brewster windows, q-switches, medical/industrial lasers, exciter systems o Analytical Instruments - UV spectrophotometer cells, fire control devices, reticle substrates, interferometer plates o Energy - Laser/Tkamak fusion research isotope separation, solar cell covers o Semiconductor/Electronic -Microcircuit substrates, microwave devices, photomasks, sputter plates, microlithography optics o Spacecraft/Aircraft - Docking light covers, windows, re-entry heat shields, ring laser gyros We have a two man sales force located in our corporate headquarters West Berlin, New Jersey that handles all domestic sales. We also use manufacture representatives in various foreign countries for international sales. Marketing efforts include direct customer contact through sales visits, advertising in trade publications and presentations at trade shows. Our products are distributed through direct sales and delivered by commercial carriers. -4-

We compete for business in the optics industry primarily with two other manufacturers of synthetic fused silica and several distributors of their products. The manufacturers are Corning Incorporated, Canton, NY and Heraeus Quarzglas, Germany. Our principal competitive distributors include United Lens Company, Inc., Southbridge, MA, Advanced Glass Industries, Rochester, NY and Glass Fab, Inc., Rochester NY. Market share in the optics industry is largely determined by a combination of quality, price and speed of delivery. We believe that we are competitive in the mid to high level quality markets. We feel that we do not compete as effectively for the lower quality markets because our price is not competitive, or in the very highest quality market because our manufacturing process is not currently able to produce product of sufficient quality. All of the fused silica that we manufacture is produced using a single manufacturing process. The product is then graded to determine its quality. We have been able to sell the higher quality material at a higher price, and with higher profit margins. With respect to speed of delivery, we believe that we perform as well as or better than our competitors. The primary raw material used in our manufacturing process is silicon tetrachloride, which we obtain from Teledyne Wah Chang. In the event we are unable to obtain silicon tetrachloride from our current supplier, it is available from Dow Chemical or Hemlock, Inc. at comparable prices. We presently have over 150 customers, with 90% of our business being concentrated in our top 40 customers. Our four largest customers, Grimes Aerospace Company, Carl Zeiss, VLOC and Spectra Physics, each accounted for approximately 8.2%, 6.8%, 5.7%, 5.3%, 5.2%, respectively, of our total revenues during nine months ended June 30, 2000. Generally, our customers provide purchase orders for a specific quantity and quality of fused silica. These purchase orders generally are filled with fused silica from inventory or manufacture to order. Orders are generally filled over a period ranging from one month to one year. The loss of any of these customers would likely have a material adverse effect on our business, financial condition and results of operations. Our business and financial condition would be materially adversely affected if we do not attain substantial additional business from these customers, or if we lose the business of any of these customers, and if we fail to attain substantial additional business from other customers. Other than federal, state and local environmental laws, our manufacturing process is not subject to direct governmental regulation. Dynasil's manufacturing process, which includes storage of hazardous materials, is subject to a variety of federal, state and local environmental rules and regulations. We make extensive use of engineering consultants to provide the technical expertise to help ensure that our equipment is in compliance with the environmental laws. Waste water and ground water testing is conducted quarterly by an engineering consultant, and the results are submitted directly to the appropriate regulating agencies. We are permitted to dispose of our waste water through the Camden County Municipal Utilities Authority. We have a permit to use an air scrubber system, which is tested periodically. The latest test was performed on March 28, 2000. We do not have a pending notice of violations and are aware of no potential violations. We train our employees in the proper handling of hazardous materials. There are no buried storage tanks on our property. A Phase I environmental audit, completed approximately two years ago, did not disclose any conditions requiring remediation. Our environmental compliance costs approximately $300,000 per year. -5-

Our research and development activities primarily have involved changes to our manufacturing process and the introduction of equipment with newer technology. Improvements to our manufacturing process involved developing larger furnaces in order to produce larger fused silica boules, and replacing existing furnaces with higher quality equipment. We have spent approximately $1,300,000 to develop the larger furnaces and upgrade existing furnaces. An additional $400,000 was invested in additional glass processing equipment. Investigations into use of purer raw material, alternative fuels and improved distribution systems have been the primary emphasis of our research and development program. We have collaborated with the University of Missouri to develop uses for scrap fused silica, and with Northwestern University to develop methods to remelt scrap material. RISK FACTORS WE MAY NEVER PAY CASH DIVIDENDS ON OUR COMMON STOCK, IN WHICH EVENT PURCHASERS' ONLY RETURN ON THEIR INVESTMENT, IF ANY, WILL OCCUR ON THE SALE OF OUR STOCK. We have never declared or paid a cash dividend. We presently intend to retain any future earnings for use in the business and do not presently intend to pay cash dividends in the foreseeable future. INDEMNIFICATION AND LIMITATION OF LIABILITY OF OUR OFFICERS AND DIRECTORS MAY INSULATE THEM FROM ACCOUNTABILITY TO STOCKHOLDERS AT SUBSTANTIAL COST TO US. Our by-laws include provisions whereby our officers and directors are to be indemnified against liabilities to the fullest extent permissible under New Jersey law. Our by-laws also limit a director's liability for monetary damages for breach of fiduciary duty, including gross negligence. In addition, we have agreed to advance the legal expenses of our officers and directors who are required to defend against claims. These provisions and agreements may have the effect of reducing the likelihood of suits against directors and officers even though such suits, if successful, might benefit us and our stockholders. Furthermore, your investment in may be adversely affected if we pay the cost of settlement and damage awards against directors and officers. A LARGE BLOCK OF SHARES CAN BE SOLD UNDER RULE 144. A large block of shares which were previously restricted can be sold under Rule 144. The sale of a large number of these shares could lower the price of our shares or make it harder to attract new investors. RISKS RELATED TO OUR OPERATIONS Our business may suffer if the optics industry fails to grow and evolve. The optics industry as a whole, experiences: . intense competition; . rapid technological changes resulting in short product life-cycles and consequent product obsolescence; . significant fluctuations in product demand; . economic cycles, including recessionary periods; and . consolidation. -6-

A recessionary period or other event leading to excess capacity affecting one or more segments of the optics industry we serve would likely result in intensified price competition, reduced margins and a decrease in sales. THE LOSS OF MAJOR CUSTOMERS COULD ADVERSELY AFFECT US. We presently have over 150 customers, with 90% of our business being concentrated in our top 40 customers. Our four largest customers, Grimes Aerospace Company, Carl Zeiss, VLOC and Spectra Physics, each accounted for approximately 8.2%, 6.8%, 5.7%, 5.3%, 5.2%, respectively, of our total revenues during nine months ended June 30, 2000. Generally, our customers provide purchase orders for a specific quantity and quality of fused silica. These purchase orders generally are filled with fused silica from inventory or manufacture to order. Orders are generally filled over a period ranging from one month to one year. The loss of any of these customers would likely have a material adverse effect on our business, financial condition and results of operations. Our business and financial condition would be materially adversely affected if we do not attain substantial additional business from these customers, or if we lose the business of any of these customers, and if we fail to attain substantial additional business from other customers. Because certain customers represent such a large part of our business, any of the following could negatively impact our business: . the loss of one or more major customers; . a significant reduction or delay in purchases from any major customer; . discontinuance by any major customer of the sale of products we manufacture; . a reduction in demand for the products of major customers that we manufacture; or . the inability or unwillingness of a major customer to pay for products and services on a timely basis or at all. Our customers do not enter into long-term purchase orders or commitments, and cancellations, reductions or delays in customer orders would adversely affect our profitability. The level and timing of orders placed by our customers vary due to: . customer attempts to manage inventory; . changes in the customers' manufacturing strategy, such as a decision by a customer to either diversify or consolidate the number of service providers used or to manufacture their products internally; and . variation in demand for customer products. -7-

We generally do not obtain long-term purchase orders or commitments from our customers. Instead, we work closely with our customers to anticipate delivery dates and future volume of orders based on customer forecasts. We rely on our estimates of anticipated future volumes when making commitments regarding: . the levels of business that we will seek and accept; . the timing of production schedules; . the purchase of materials; . the purchase or leasing of facilities and equipment; and . the levels and utilization of personnel and other resources. Customers may cancel, reduce or delay orders that were either previously made or anticipated for a variety of reasons. Significant or numerous terminations, reductions or delays in our customers' orders could negatively impact our operating results. We often manufacture product based on customer forecasts, at times without a customer commitment to pay for them. INCREASED COMPETITION MAY RESULT IN DECREASED DEMAND OR PRICES FOR OUR PRODUCTS. The optics industry is highly competitive. We compete against numerous U.S. and foreign manufacturing providers with global operations, as well as those who operate on a local or regional basis. In addition, current and prospective customers continually evaluate the merits of manufacturing products internally. Consolidation in the optics industry results in a continually changing competitive landscape. The consolidation trend in the industry also results in larger and more geographically diverse competitors who have significant combined resources with which to compete against us. Some of our competitors have substantially greater managerial, manufacturing, engineering, technical, financial, systems, sales and marketing resources than we do. These competitors may: . respond more quickly to new or emerging technologies; . have greater name recognition, critical mass and geographic and market presence; . be better able to take advantage of acquisition opportunities; . adapt more quickly to changes in customer requirements; and . devote greater resources to the development, promotion and sale of their products. WE MAY BE OPERATING AT A COST DISADVANTAGE COMPARED TO MANUFACTURERS WHO HAVE GREATER DIRECT BUYING POWER FROM RAW MATERIAL SUPPLIERS OR WHO HAVE LOWER COST STRUCTURES. Our manufacturing processes are generally not subject to significant proprietary protection, and companies with greater resources or a greater geographic and market presence may enter our market or increase their competition with us. Increased competition from existing or potential competitors could result in price reductions, reduced margins or loss of market share. -8-

WE MAY NOT BE ABLE TO OBTAIN RAW MATERIALS OR COMPONENTS FOR OUR PRODUCT ON A TIMELY BASIS OR AT ALL. We rely on a single or limited number of third-party suppliers for the raw materials used in the manufacturing process. We do not have any long-term supply agreements. Shortages of materials have occurred from time to time and will likely occur in the future. Raw materials or component shortages could result in shipping delays or increased prices which could adversely affect our ability to manufacture products for our customers on a timely basis or at acceptable cost. Moreover, the consolidation trend in our suppliers' industry results in changes in supply relationships and in the price, availability and quality of components and raw materials. WE MAY NOT BE ABLE TO MAINTAIN OUR TECHNOLOGICAL AND MANUFACTURING PROCESS EXPERTISE. The markets for our manufacturing services are characterized by rapidly changing technology and evolving process development. The continued success of our business will depend upon our ability to: . maintain and enhance our technological capabilities; . develop and market manufacturing services which meet changing customer needs; and . successfully anticipate or respond to technological changes in manufacturing processes on a cost-effective and timely basis. We may incur significant liabilities if we fail to comply with environmental regulations. We are subject to environmental regulations relating to the use, storage, discharge, site cleanup, and disposal of hazardous chemicals used in our manufacturing processes. If we fail to comply with present and future regulations, or are required to perform site remediation, we could be subject to future liabilities or the suspension of production. Present and future regulations may also: . restrict our ability to expand our facilities; . require us to acquire costly equipment; or . require us to incur other significant costs and expenses. RISKS RELATED TO OUR COMMON STOCK We anticipate that our net sales and operating results will fluctuate which could affect the price of our common stock. Our net sales and operating results have fluctuated and may continue to fluctuate significantly from quarter to quarter. A substantial portion of our net sales in a given quarter may depend on obtaining and fulfilling orders to be manufactured and shipped in the same quarter in which those orders are received. In addition to the variability resulting from the short-term nature of our customers' commitments, the following factors may contribute to such fluctuations: . fluctuations in demand for our services or the products we manufacture; . shipment delays; . interruptions in manufacturing caused by earthquakes or other natural disasters; -9-

. effectiveness in controlling manufacturing costs; . changes in cost and availability of labor and components; . inefficiencies in managing inventory and accounts receivable, including inventory obsolescence and write-offs; and . the levels at which we utilize our manufacturing capacity. Our operating expenses are based on anticipated revenue levels and a high percentage of our operating expenses are relatively fixed in the short term. As a result, any unanticipated shortfall in revenue in a quarter would likely adversely affect our operating results for that quarter. Also, changes in our product mix may cause our margins to fluctuate which could negatively impact our results of operations for that period. Results of operations in any period should not be considered indicative of the results to be expected for any future period. It is likely that in one or more future periods our results of operations will fail to meet the expectations of securities analysts or investors, and the price of our common stock could decline significantly. THE PRICE OF OUR COMMON STOCK HAS BEEN AND MAY CONTINUE TO BE VOLATILE. The price of our common stock has been and may continue to be volatile. The price of our common stock may fluctuate significantly in response to a number of events and factors relating to our company, our competitors and the market for our services, many of which are beyond our control, such as: . quarterly variations in our operating results; . announcements of new technological innovations, equipment or service offerings by us or our competitors; . announcements of new products or enhancement by our customers; . changes in financial estimates and recommendations by securities analysts; and . news relating to trends in our markets. In addition, the stock market in general, and the market prices for technology companies in particular, have experienced extreme volatility that often has been unrelated to the operating performance of these companies. These broad market and industry fluctuations may adversely affect the market price of our common stock, regardless of our operating performance. Recently, when the market price of a stock has been volatile, holders of that stock have often instituted securities class action litigation against the company that issued the stock. We have been the subject of such a lawsuit. If any of our stockholders brought another securities class action lawsuit against us, we could incur substantial additional costs defending that lawsuit. The lawsuit could also divert the time and attention of our management and an adverse judgment could cause our financial condition or operating results to suffer. WE RELY ON TRADE SECRET AND COPYRIGHT LAWS TO PROTECT THE PROPRIETARY TECHNOLOGIES THAT WE MAY DEVELOP. There can be no assurance that trade secret and/or copyright laws will provide us with sufficient protection, that others will not develop technologies that are similar or superior to ours, or that third parties will not copy or otherwise obtain or use our technologies without our authorization. We have no patents or patent applications filed or pending. -10-

Special Note Regarding Forward-looking Statements Some of the statements contained in this prospectus, including information incorporated by reference, discuss future expectations, contain projections of future results of operations or financial condition or state other "forward-looking" information. Those statements are subject to known and unknown risks, uncertainties and other factors that could cause the actual results to differ materially from those contemplated by the statements. The forward-looking information is based on various factors and was derived using numerous assumptions. Important factors that may cause actual results to differ from projections include the risk factors set forth above. USE OF PROCEEDS The Company will receive the price of the shares of Common Stock offered pursuant to the 1996 Stock Incentive Plan, the 1999 Stock Incentive Plan and the Employee Stock Purchase Plan, when exercised by the holders thereof. Such proceeds will be used for working capital purposes by the Company. The Company will not receive any of the proceeds from the reoffer and resale of the shares (the "Shares") of Common Stock, $.0005 par value ("Common Stock") by the selling shareholders. SELLING SHAREHOLDERS This Prospectus relates to the reoffer and resale of Shares issued or that may be issued to the Selling Shareholders under the 1996 Stock Incentive Plan, the 1999 Stock Incentive Plan or the Employee Stock Purchase Plan. The following table sets forth (i) the number of shares of Common Stock beneficially owned by each Selling Shareholder at September 19, 2000, (ii) the number of Shares to be offered for resale by each selling shareholder (i.e., the total number of Shares acquired under the Employee Stock Purchase Plan), (iii) the total number of shares underlying options held by the selling shareholders irrespective of whether such options are presently exercisable or exercisable within sixty days of September 19, 2000; and (iv) the number and percentage of shares of Common Stock to be held by each Selling Shareholder after completion of the offering. The table is based upon 2,356,408 shares outstanding as of September 19, 2000. Number of shares of Common Stock/ Number of Percentage of Class to Number of shares of Shares to be be Owned After Common Stock Owned at Offered for Completion of the Name, Position with Company April 30, 2000(1) Resale Offering - ---------------------------------------- ------------------------ ----------------- ------------------------ Bruce Leonetti, Vice President, Sales...... 10,100 10,000 * *less than one percent (1) Does not include 1,274 shares sold to unnamed non-affiliates who hold less than 1% of the shares issuable under the plan -11-

PLAN OF DISTRIBUTION It is anticipated that the Shares will be offered by the selling shareholders from time to time in the open market, either directly or through brokers or agents, or in privately negotiated transactions. The selling shareholders have advised the Company that they are not parties to any agreement, arrangement or understanding as to such sales. DISCLOSURE OF COMMISSION POSITION ON INDEMNIFICATION FOR SECURITIES ACT LIABILITIES Section 14A:3-5 of New Jersey Business Corporation Law grants each corporation organized thereunder the power to indemnify its officers, directors, employees and agents on certain conditions against liabilities arising out of any action or proceeding to which any of them is a party by reason of being such officer, director, employee or agent. The Certificate of Incorporation also provides for the indemnification, to the fullest extent permitted by New Jersey Business Corporation Law, of such persons. Insofar as indemnification for liabilities arising under the Securities Act, may be permitted to directors, officers or persons controlling the Company pursuant to the foregoing provisions, the Company has been informed that in the opinion of the Commission such indemnification is against public policy as expressed in the Securities Act and is therefore unenforceable. LEGAL MATTERS Certain legal matters in connection with the issuance of the Shares offered hereby have been passed upon for the Company by Stephen M. Robinson, P.A., 172 Tuckerton Road, Medford, New Jersey, 08055. EXPERTS The consolidated financial statements of Dynasil Corporation of America and subsidiaries as of September 30, 1999 and 1998 have been incorporated by reference in reliance upon the report of Haefele, Flanagan & Co., p.c., independent certified public accountants, upon the authority of said firm as experts in accounting and auditing. PART II--INFORMATION REQUIRED IN THE REGISTRATION STATEMENT ITEM 3. INCORPORATION OF DOCUMENTS BY REFERENCE. The following documents are hereby incorporated by reference in this Registration Statement and are deemed to be a part hereof from the date of filing such documents by Dynasil Corporation of America (the "Corporation"): (a) The Corporation's Annual Report on Form 10-KSB for the fiscal year ended September 30, 1999; and (b) The Corporation's Quarterly Reports on Form 10-QSB for the quarters ended December 31, 1999, March 31, 2000 and June 30, 2000; -12-

(c) The Corporation's proxy statement dated December 23, 1999, filed with the Securities and Exchange Commission on December 29, 1999 (d) Registrant's Form 10-SB Registration Statement filed October 1, 1999 All documents subsequently filed by the registrant pursuant to Sections 13(a), 13(c), 14 and 15(d) of the Securities Exchange Act of 1934, as amended, prior to the filing of a post-effective amendment which indicates that all securities offered have been sold or which deregisters all securities then remaining unsold, shall be deemed to be incorporated by reference in this Registration Statement and to be a part hereof from the date of filing of such documents. Any statement contained herein or in a document, all or a portion of which is incorporated by reference herein shall be deemed to be modified or superseded for purposes of this Registration Statement to the extent that a statement contained in any subsequently filed document which also is or is deemed to be incorporated by reference herein modifies or supersedes such statement. Any such statement so modified or superseded shall not be deemed, except as so modified or superseded, to constitute a part of this Registration Statement. ITEM 4. DESCRIPTION OF SECURITIES. Not applicable. ITEM 5. INTERESTS OF NAMED EXPERTS AND COUNSEL. Not applicable. ITEM 6. INDEMNIFICATION OF DIRECTORS AND OFFICERS. The by-laws of the Company provide that every person who is or was a director or officer, employee or agent of the Company, or any person who serves or has served in any capacity with any other enterprise at the request of the Company, shall be indemnified by the Company to the fullest extent permitted by law. The Company shall indemnify the persons listed above against all expenses and liabilities reasonably incurred by or imposed on them in connection with any proceedings to which they have been or may be made parties, or any proceedings in which they may have become involved by reason of being or having been a director or officer of the Company, or by reason of serving or having served another enterprise at the request of the Company, whether or not in the capacities of directors or officers of the Company at the time the expenses or liabilities are incurred. New Jersey has enacted the following statutory indemnification provisions: NJSA 14A:3-5. Indemnification of directors, officers and employees - (1) As used in this section, (a) "Corporate agent" means any person who is or was a director, officer, employee or agent of the indemnifying corporation or of any constituent corporation absorbed by the indemnifying corporation in a consolidation or merger and any person who is or was a director, officer, trustee, employee or agent of any other enterprise, serving as such at the request of the indemnifying corporation, or of any such constituent corporation, or the legal representative of any such director, officer, trustee, employee or agent; (b) "Other enterprise" means any domestic or foreign corporation, other than the indemnifying corporation, and any partnership, joint venture, sole proprietorship, trust or other enterprise, whether or not for profit, served by a corporate agent; -13-

(c) "Expenses" means reasonable costs, disbursements and counsel fees; (d) "Liabilities" means amounts paid or incurred in satisfaction of settlements, judgments, fines and penalties; (e) "Proceeding" means any pending, threatened or completed civil, criminal, administrative or arbitrative action, suit or proceeding, and any appeal therein and any inquiry or investigation which could lead to such action, suit or proceeding; and (f) References to "other enterprises" include employee benefit plans; references to "fines" include any excise taxes assessed on a person with respect to an employee benefit plan; and references to "serving at the request of the indemnifying corporation" include any service as a corporate agent which imposes duties on, or involves services by, the corporate agent with respect to an employee benefit plan, its participants, or beneficiaries; and a person who acted in good faith and in a manner the person reasonably believed to be in the interest of the participants and beneficiaries of an employee benefit plan shall be deemed to have acted in a manner "not opposed to the best interests of the corporation" as referred to in this section. (2) Any corporation organized for any purpose under any general or special law of this State shall have the power to indemnify a corporate agent against his expenses and liabilities in connection with any proceeding involving the corporate agent by reason of his being or having been such a corporate agent, other than a proceeding by or in the right of the corporation, if (a) such corporate agent acted in good faith and in a manner he reasonably believed to be in or not opposed to the best interests of the corporation; and (b) with respect to any criminal proceeding, such corporate agent had no reasonable cause to believe his conduct was unlawful. The termination of any proceeding by judgment, order, settlement, conviction or upon a plea of nolo contendere or its equivalent, shall not of itself create a presumption that such corporate agent did not meet the applicable standards of conduct set forth in paragraphs 14A:3-5(2)(a) and 14A:3-5(2)(b). (3) Any corporation organized for any purpose under any general or special law of this State shall have the power to indemnify a corporate agent against his expenses in connection with any proceeding by or in the right of the corporation to procure a judgment in its favor which involves the corporate agent by reason of his being or having been such corporate agent, if he acted in good faith and in a manner he reasonably believed to be in or not opposed to the best interests of the corporation. However, in such proceeding no indemnification shall be provided in respect of any claim, issue or matter as to which such corporate agent shall have been adjudged to be liable to the corporation, unless and only to the extent that the Superior Court or the court in which such proceeding was brought shall determine upon application that despite the adjudication of liability, but in view of all circumstances of the case, such corporate agent is fairly and reasonably entitled to indemnity for such expenses as the Superior Court or such other court shall deem proper. (4) Any corporation organized for any purpose under any general or special law of this State shall indemnify a corporate agent against expenses to the extent that such corporate agent has been successful on the merits or otherwise in any proceeding referred to in subsections 14A:3-5(2) and 14A:3-5(3) or in defense of any claim, issue or matter therein. -14-

(5) Any indemnification under subsection 14A:3-5(2) and, unless ordered by a court, under subsection 14A:3-5(3) may be made by the corporation only as authorized in a specific case upon a determination that indemnification is proper in the circumstances because the corporate agent met the applicable standard of conduct set forth in subsection 14A:3-5(2) or subsection 14A:3-5(3). Unless otherwise provided in the certificate of incorporation or bylaws, such determination shall be made (a) by the board of directors or a committee thereof, acting by a majority vote of a quorum consisting of directors who were not parties to or otherwise involved in the proceeding; or (b) if such a quorum is not obtainable, or, even if obtainable and such quorum of the board of directors or committee by a majority vote of the disinterested directors so directs, by independent legal counsel, in a written opinion, such counsel to be designated by the board of directors; or (c) by the shareholders if the certificate of incorporation or bylaws or a resolution of the board of directors or of the shareholders so directs. (6) Expenses incurred by a corporate agent in connection with a proceeding may be paid by the corporation in advance of the final disposition of the proceeding as authorized by the board of directors upon receipt of an undertaking by or on behalf of the corporate agent to repay such amount if it shall ultimately be determined that he is not entitled to be indemnified as provided in this section. (7) (a) If a corporation upon application of a corporate agent has failed or refused to provide indemnification as required under subsection 14A:3-5(4) or permitted under subsections 14A:3-5(2), 14A:3-5(3) and 14A:3-5(6), a corporate agent may apply to a court for an award of indemnification by the corporation, and such court (i) may award indemnification to the extent authorized under subsections 14A:3-5(2) and 14A:3-5(3) and shall award indemnification to the extent required under subsection 14A:3-5(4), notwithstanding any contrary determination which may have been made under subsection 14A:3-5(5); and (ii) may allow reasonable expenses to the extent authorized by, and subject to the provisions of, subsection 14A:3-5(6), if the court shall find that the corporate agent has by his pleadings or during the course of the proceeding raised genuine issues of fact or law. (b) Application for such indemnification may be made (i) in the civil action in which the expenses were or are to be incurred or other amounts were or are to be paid; or (ii) to the Superior Court in a separate proceeding. If the application is for indemnification arising out of a civil action, it shall set forth reasonable cause for the failure to make application for such relief in the action or proceeding in which the expenses were or are to be incurred or other amounts were or are to be paid. The application shall set forth the disposition of any previous application for indemnification and shall be made in such manner and form as may be required by the applicable rules of court or, in the absence thereof, by direction of the court to which it is made. Such application shall be upon notice to the corporation. The court may also direct that notice shall be given at the expense of the corporation to the shareholders and such other persons as it may designate in such manner as it may require. -15-

(8) The indemnification and advancement of expenses provided by or granted pursuant to the other subsections of this section shall not exclude any other rights, including the right to be indemnified against liabilities and expenses incurred in proceedings by or in the right of the corporation, to which a corporate agent may be entitled under a certificate of incorporation, bylaw, agreement, vote of shareholders, or otherwise; provided that no indemnification shall be made to or on behalf of a corporate agent if a judgment or other final adjudication adverse to the corporate agent establishes that his acts or omissions (a) were in breach of his duty of loyalty to the corporation or its shareholders, as defined in subsection (3) of > N.J.S.14A:2-7, (b) were not in good faith or involved a knowing violation of law or (c) resulted in receipt by the corporate agent of an improper personal benefit. (9) Any corporation organized for any purpose under any general or special law of this State shall have the power to purchase and maintain insurance on behalf of any corporate agent against any expenses incurred in any proceeding and any liabilities asserted against him by reason of his being or having been a corporate agent, whether or not the corporation would have the power to indemnify him against such expenses and liabilities under the provisions of this section. The corporation may purchase such insurance from, or such insurance may be reinsured in whole or in part by, an insurer owned by or otherwise affiliated with the corporation, whether or not such insurer does business with other insureds. (10) The powers granted by this section may be exercised by the corporation, notwithstanding the absence of any provision in its certificate of incorporation or bylaws authorizing the exercise of such powers. (11) Except as required by subsection 14A:3-5(4), no indemnification shall be made or expenses advanced by a corporation under this section, and none shall be ordered by a court, if such action would be inconsistent with a provision of the certificate of incorporation, a bylaw, a resolution of the board of directors or of the shareholders, an agreement or other proper corporate action, in effect at the time of the accrual of the alleged cause of action asserted in the proceeding, which prohibits, limits or otherwise conditions the exercise of indemnification powers by the corporation or the rights of indemnification to which a corporate agent may be entitled. (12) This section does not limit a corporation's power to pay or reimburse expenses incurred by a corporate agent in connection with the corporate agent's appearance as a witness in a proceeding at a time when the corporate agent has not been made a party to the proceeding. ITEM 7. EXEMPTION FROM REGISTRATION CLAIMED. 9,274 shares were offered pursuant to Rule 701 to employees under the Employee Stock Purchase Plan prior to Registrant becoming a reporting company. -16-

ITEM 8. EXHIBITS. Exhibit Number Description - ------- ------------ 5 * Opinion of Stephen M. Robinson, P.A. 10.03+ 1996 Stock Incentive Plan of the Registrant (Incorporated by reference from the Registrant's Registration Statement on Form 10 filed 10/1/99) 10.04+ 1999 Stock Incentive Plan of the Registrant (Incorporated by reference from the Registrant's Registration Statement on Form 10 filed 10/1/99) 10.05+ Employee Stock Purchase Plan of the Registrant (Incorporated by reference from the Registrant's Registration Statement on Form 10 filed 10/1/99) 10.06* 1999 Stock Incentive Plan of the Registrant, as amended July 25, 2000 10.07* Employee Stock Purchase Plan of the Registrant, as amended July 25, 2000 23.1 * Independent Auditors' Consent 23.2 * Legal Counsel Consent (contained in Exhibit 5) *Filed herewith +Incorporated by reference -17-

ITEM 9. UNDERTAKINGS. (a) The undersigned registrant hereby undertakes: (1) To file, during any period in which offers or sales are being made, a post-effective amendment to this registration statement: (i) To include any prospectus required by Section 10(a)(3) of the Securities Act of 1933; (ii) To reflect in the prospectus any facts or events arising after the effective date of the registration statement (or the most recent post-effective amendment thereof) which, individually or in the aggregate, represent a fundamental change in the information set forth in the registration statement; (iii) To include any material information with respect to the plan of distribution not previously disclosed in the registration statement or any material change to such information in the registration statement; provided, however, that paragraphs (a)(1)(i) and (a)(1)(ii) do not apply if the information required to be included in a post-effective amendment by those paragraphs is contained in periodic reports filed with or furnished to the Securities and Exchange Commission by the registrant pursuant to Section 13 or Section 15(d) of the Securities Exchange Act of 1934 that are incorporated by reference in the registration statement. (2) That, for the purpose of determining any liability under the Securities Act of 1933, each such post-effective amendment shall be deemed to be a new registration statement relating to the securities offered therein, and the offering of such securities at that time shall be deemed to be the initial bona fide offering thereof. (3) To remove from registration by means of a post-effective amendment any of the securities being registered which remain unsold at the termination of the offering. (b) The undersigned registrant hereby undertakes that, for purposes of determining any liability under the Securities Act of 1933, each filing of the registrant's annual report pursuant to Section 13(a) or Section 15(d) of the Securities Exchange Act of 1934 (and, where applicable, each filing of an employee benefit plan's annual report pursuant to Section 15(d) of the Securities Exchange Act of 1934) that is incorporated by reference in the registration statement shall be deemed to be a new registration statement relating to the securities offered therein, and the offering of such securities at that time shall be deemed to be the initial bona fide offering thereof. (h) Insofar as indemnification for liabilities arising under the Securities Act of 1933 may be permitted to directors, officers and controlling persons of the registrant pursuant to the foregoing provisions, or otherwise, the registrant has been advised that in the opinion of the Securities and Exchange Commission such indemnification is against public policy as expressed in the Act and is, therefore, unenforceable. In the event that a claim for indemnification against such liabilities (other than the payment by the registrant of expenses incurred or paid by a director, officer or controlling person of the registrant in the successful defense of any action, suit or proceeding) is asserted by such director, officer or controlling person in connection with the securities being registered, the registrant will, unless in the opinion of its counsel the matter has been settled by controlling precedent, submit to a court of appropriate jurisdiction the question of whether such indemnification by it is against public policy as expressed in the Act and will be governed by the final adjudication of such issue. -18-

SIGNATURES Pursuant to the requirements of the Securities Act of 1933, 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 Township of West Berlin, State of New Jersey on the day of August, 2000. DYNASIL CORPORATION OF AMERICA By: /s/ ----------------------------------- Charles J. Searock, Jr., President, Chief Executive Officer, Director Pursuant to the requirements of the Securities Act of 1933, this Registration Statement has been signed by the following persons in the capacities and on the date indicated. Signature Title Date - --------- ----- ---- BY: /s/ James Saltzman Chairman of the Board of August , 2000 --------------------- Directors ----------------- James Saltzman BY: /s/ Charles J. Searock Jr. President, CEO and Director August , 2000 -------------------------- ----------------- Charles J. Searock, Jr. BY: /s/ John Kane Secretary, Treasurer, August , 2000 --------------------- and Chief Financial Officer ----------------- John Kane (Principal Financial Officer and Principal Accounting Officer) BY: /s/ Jan Melles Director August , 2000 --------------------- ----------------- Jan Melles BY: /s/ Nathan Schwartz Director August , 2000 --------------------- ----------------- Nathan Schwartz BY: /s/ Peter P. Bihuniak Director August , 2000 --------------------- ----------------- Dr. Peter P. Bihuniak BY: /s/ Robert Lear Director August , 2000 --------------------- ----------------- Robert Lear -19

                                                                      EXHIBIT 5


                                     [LETTERHEAD]


                                          September 19, 2000


Securities and Exchange Commission
Division of Corporate Finance
450 Fifth Street, NW
Washington, DC 20549



         Re:  Dynasil Corporation of America
              REGISTRATION STATEMENT ON FORM S-8

Ladies and Gentlemen:

      We have acted as counsel to Dynasil Corporation of America, a New Jersey
corporation (the "Company"), in connection with the registration of
650,000 shares of common stock, $.0005 par value (the "Shares"), with the
Securities and Exchange Commission (the "Commission") under the Securities
Act of 1933, as amended (the "1933 Act") pursuant to a registration
statement on Form S-8 (the "Registration Statement").  The Shares are
registered on behalf of the Company; and 450,000 of such shares will be
issued pursuant to the Company's 1996 Stock Incentive Plan; 150,000 of such
shares will be issued pursuant to the Company's 1999 Stock Incentive Plan; and
50,000 of such shares will be issued pursuant to the Company's Employee Stock
Purchase Plan (collectively, the "Plans").

         This opinion is being delivered in accordance with the requirements
of Item 601(b)(5)(i) of Regulation S-B under the 1933 Act.

         As counsel to the Company, we have examined such documents and
records as we deemed appropriate.

         In rendering this opinion, we have relied, as to matters of fact,
upon representations and certificates of officers and employees of the
Company, and communications from, government authorities and public
officials; and we have assumed the genuineness of signatures of all persons
signing any documents, the authority of all persons signing any document,
the authority of all governmental authorities and public officials, the
truth and accuracy of all matters of fact set forth in all certificates
furnished to us, the authenticity of all documents submitted to us as
originals and the conformity to original documents of all documents
submitted to us as certified, conformed or photostatic copies.

         Based upon the foregoing, we are of the opinion that the Shares
issuable upon exercise of options issued under the Plans, when issued and
delivered upon exercise of such options in accordance with the terms of the
Plans, will be validly issued, fully paid and non-assessable.

         This opinion is solely for your information in connection with the
offer and sale of the Shares by the Company, and is not, without the prior
written consent of this firm, to be quoted in full or in part or otherwise
referred to in any documents nor to be filed with any governmental agency or
other persons, other than with the Commission and various state securities
administrators in connection with the qualification of the Shares, to which
reference and filings we hereby consent.  In giving this consent, we do not
thereby admit that we are in the category of persons whose consent is
required under Section 7 of the 1933 Act or the rules and regulations of the
Commission.


                                  Very truly yours,

                                  STEPHEN M. ROBINSON, P.A.

                                  /s/ Stephen M. Robinson

                                  BY:  Stephen M. Robinson

                DYNASIL CORPORATION OF
                       AMERICA

              1999 Stock  Incentive Plan

               As amended July 25, 2000
             DYNASIL CORPORATION OF AMERICA
                    1999 Stock Incentive Plan
                     AS AMENDED JULY 25, 2000

                           ARTICLE ONE

                        GENERAL PROVISIONS


I.   PURPOSE OF THE PLAN

     This 1999 Stock Incentive Plan, as amended July 25, 2000 ("Plan") is
intended to promote the interests of DYNASIL CORPORATION OF AMERICA, a New
Jersey corporation, by providing eligible persons with the opportunity to
acquire a proprietary interest, or otherwise increase their proprietary
interest, in the Corporation as an incentive for them to remain in the
service of the Corporation.

     Capitalized terms shall have the meanings assigned to such terms in the
attached Appendix.
II.  STRUCTURE OF THE PLAN

     A.   The Plan shall be divided into two separate equity programs:
          1.   the Discretionary Option Grant Program under which eligible
persons may, at the discretion of the Plan Administrator, be granted options
to purchase shares of Common Stock; and

          2.   the Stock Issuance Program under which eligible persons may,
at the discretion of the Plan Administrator, be issued shares of Common Stock
directly, either through the immediate purchase of such shares or as a bonus
for services rendered the Corporation (or any Parent or Subsidiary).

     B.   The Plan shall become effective immediately upon the Plan Effective
Date, January 26, 1999.

III. ADMINISTRATION OF THE PLAN

     A.   The Plan shall be administered by the Plan Administrator, which
will be comprised of the Stock Option Committee designated by the Board (the
"Committee"), and any sub-committee of the Committee which the Board
determines is necessary to comply with the requirements of the Code and the
1934 Act.

     B.   Members of the Committee shall serve for such period of time as the
Board may determine and may be removed by the Board at any time. The Board
may also at any time terminate the functions of the Committee and reassume
all powers and authority previously delegated to the  Committee.

     C.   The Plan Administrator shall, within the scope of its
administrative functions under the Plan, have full power and authority to
establish such rules and regulations as it may deem appropriate for proper
administration of the Plan and to make such determinations under, and issue
such interpretations of the provisions of such programs and any outstanding
options or stock issuances thereunder as it may deem necessary or advisable.
Decisions of the Plan Administrator within the scope of its administrative
functions under the Plan shall be final and binding on all parties who have
an interest in the Plan or any stock option or stock issuance thereunder.
     D.   Service on the Committee shall constitute service as a Board
member, and members of the Committee shall accordingly be entitled to full
indemnification and reimbursement as Board members for their service on the
Committee. No member of the Committee shall be liable for any act or omission
made in good faith with respect to the Plan or any option grants or stock
issuances under the Plan.

IV.  ELIGIBILITY

     A.   The persons eligible to participate in the Discretionary Option
Grant and Stock Issuance Programs are as follows:

          1.   Employees,

          2.   non-employee members of the Board or the board of directors of
any Parent or Subsidiary,

          3.   consultants and other independent advisors who provide
services to the Corporation (or any Parent or Subsidiary), and

          4.   any other entity or person which the Plan Administrator
believes could benefit the business of the Corporation (or any Parent or
Subsidiary).
     B.   The Plan Administrator shall, within the scope of its
administrative jurisdiction under the Plan, have full authority (subject to
the provisions of the Plan) to determine, (i) with respect to the option
grants under the Discretionary Option Grant Program, which eligible persons
are to receive option grants, the time or times when such option grants are
to be made, the number of shares to be covered by each such grant, the status
of the granted option as either an Incentive Option or a Non-Statutory
Option, the time or times at which each option is to become exercisable, the
vesting schedule (if any) applicable to the option shares and the maximum
term for which the option is to remain outstanding and (ii) with respect to
stock issuances under the Stock Issuance Program, which eligible persons are
to receive stock issuances, the time or times when such issuances are to be
made, the number of shares to be issued to each Participant, the vesting
schedule (if any) applicable to the issued shares and the consideration to be
paid for such shares.
     C.   The Plan Administrator shall have the absolute discretion either to
grant options in accordance with the Discretionary Option Grant Program or to
effect stock issuances in accordance with the Stock Issuance Program.

V.   STOCK SUBJECT TO THE PLAN

     A.   The stock issuable under the Plan shall be shares of authorized but
unissued or reacquired Common Stock, including shares repurchased by the
Corporation on the open market. The maximum number of shares of Common Stock
which may be issued over the term of the Plan shall not exceed 450,000
shares.

     B.   Shares of Common Stock subject to outstanding options shall be
available for subsequent issuance under the Plan to the extent (i) the
options expire or terminate for any reason prior to exercise in full or (ii)
the options are canceled in accordance with the cancellation re-grant
provisions of Article Two. All shares issued under the Plan, whether or not
those shares are subsequently repurchased or canceled by the Corporation
pursuant to its repurchase or cancellation rights under the Plan, shall
reduce on a share-for-share basis the number of shares of Common Stock
available for subsequent issuance under the Plan.  In addition, should the
exercise price of an option under the Plan be paid with shares of Common
Stock, then the number of shares of Common Stock available for issuance under
the Plan shall be reduced by the gross number of shares for which the option
is exercised or which vest under the stock issuance, and not by the net
number of shares of Common Stock issued to the holder of such option or stock
issuance.
     C.   Should any change be made to the Common Stock by reason of any
stock split, stock dividend, recapitalization, combination of shares, change
of shares or other change affecting the outstanding Common Stock as a class
without the Corporation's receipt of consideration, appropriate adjustments
shall be made to (i) the maximum number and/or class of securities issuable
under the Plan, (ii) the maximum number and/or class of securities for which
any one person may be granted options, separately exercisable stock
appreciation rights and direct stock issuances in the aggregate per calendar
year, and (iii) the number and/or class of securities and the exercise price
per share in effect under each outstanding option in order to prevent the
dilution or enlargement of benefits thereunder.  The adjustments determined
by the Plan Administrator shall be final, binding and conclusive.

                           ARTICLE TWO

                DISCRETIONARY OPTION GRANT PROGRAM

I.   OPTION TERMS

     Each option shall be evidenced by one or more documents in the form
approved by the Plan Administrator; provided, however, that each such
document shall comply with the terms specified below.  Each document
evidencing an Incentive Option shall, in addition, be subject to the
provisions of the Plan applicable to such options.

     A.   Exercise Price.

          1.   The exercise price per share shall be fixed by the Plan
Administrator; provided, however, that in the case of a Non-Statutory Stock
Option intended to qualify as "performance-based compensation" within the
meaning of Section 162(m) of the Code, the exercise price per share shall be
no less than 100% of the Fair Market Value on the option grant date.
          2.   The exercise price shall become immediately due upon exercise
of the option and shall, subject to the provisions of Section I of Article
Four and the documents evidencing the option, be payable in one or more of
the forms specified below:
               (i)  cash or check made payable to the Corporation,
               (ii) shares of Common Stock held for the requisite  period
necessary to avoid a charge to the Corporation's earnings for financial
reporting purposes and valued at Fair Market Value on the Exercise Date, or

               (iii)     to the extent the option is exercised for vested
shares, through a special sale and remittance procedure pursuant to which the
Optionee shall concurrently provide irrevocable written instructions to (a) a
Corporation-designated brokerage firm to effect the immediate sale of the
purchased shares and remit to the Corporation, out of the sale proceeds
available on the settlement date, sufficient funds to cover the aggregate
exercise price payable for the purchased shares plus all applicable Federal,
state and local income and employment taxes required to be withheld by the
Corporation by reason of such exercise and (b) the Corporation to deliver the
certificates for the purchased shares directly to such brokerage firm in
order to complete the sale transaction.

     Except to the extent such sale and remittance procedure is utilized,
payment of the exercise price for the purchased shares must be made on the
Exercise Date.
     B.   Exercise and Term of Options.  Each option shall be exercisable at
such time or times, during such period and for such number of shares as shall
be determined by the Plan Administrator and set forth in the documents
evidencing the option. However, no option shall have a term in excess of ten
(10) years measured from the option grant date.

     C.   Effect of Termination of Service.

          1.   The following provisions shall govern the exercise of any
options held by the Optionee at the time of cessation of Service or death:

               (i)  Any option outstanding at the time of the Optionee's
cessation of Service for any reason shall remain exercisable for such period
of time thereafter as shall be determined by the Plan Administrator and set
forth in the documents evidencing the option, but no such option shall be
exercisable after the expiration of the option term.
               (ii) Any option exercisable in whole or in part by the
Optionee at the time of death may be exercised subsequently by the personal
representative of the Optionee's estate or by the person or persons to whom
the option is transferred pursuant to the Optionee's will or in accordance
with the laws of descent and distribution.

               (iii)     During the applicable post-Service exercise period,
the option may not be exercised in the aggregate for more than the number of
vested shares for which the option is exercisable on the date of the
Optionee's cessation of Service. Upon the expiration of the applicable
exercise period or (if earlier) upon the expiration of the option term, the
option shall terminate and cease to be outstanding for any vested shares for
which the option has not been exercised. However, the option shall,
immediately upon the Optionee's cessation of Service, terminate and cease to
be outstanding to the extent the option is not otherwise at that time
exercisable for vested shares.
               (iv) Should the Optionee's Service be terminated for
Misconduct, then all outstanding options held by the Optionee shall terminate
immediately and cease to be outstanding.
          2.   The Plan Administrator shall have the discretion, exercisable
either at the time an option is granted or at any time while the option
remains outstanding, to:
               (i)  extend the period of time for which the option is to
remain exercisable following the Optionee's cessation of Service from the
period otherwise in effect for that option to such greater period of time as
the Plan Administrator shall deem appropriate, but in no event beyond the
expiration of the option term, and/or

               (ii) permit the option to be exercised, during the applicable
post-Service exercise period, not only with respect to the number of vested
shares of Common Stock for which such option is exercisable at the time of
the Optionee's cessation of Service but also with respect to one or more
additional installments in which the Optionee would have vested under the
option had the Optionee continued in Service.

     D.   Stockholder Rights.  The holder of an option shall have no
stockholder rights with respect to the shares subject to the option until
such person shall have exercised the option, paid the exercise price and
become a holder of record of the purchased shares.
     E.   Repurchase Rights.  The Plan Administrator shall have the
discretion to grant options which are exercisable for unvested shares of
Common Stock.  Should the Optionee cease Service while holding such unvested
shares, the Corporation shall have the right to repurchase, at the exercise
price paid per share, any or all of those unvested shares.  The terms upon
which such repurchase right shall be exercisable (including the period and
procedure for exercise and the appropriate vesting schedule for the purchased
shares) shall be established by the Plan Administrator and set forth in the
document evidencing such repurchase right.

     F.   Limited Transferability of Options.  During the lifetime of the
Optionee, the option shall be exercisable only by the Optionee and shall not
be assignable or transferable other than by will or by the laws of descent
and distribution following the Optionee's death.  However, a Non-Statutory
Option may be assigned in whole or in part during the Optionee's lifetime in
accordance with the terms of a Qualified Domestic Relations Order.  The
assigned portion may only be exercised by the person or persons who acquire a
proprietary interest in the option pursuant to such Qualified Domestic
Relations Order.  The terms applicable to the assigned portion shall be the
same as those in effect for the option immediately prior to such assignment
and shall be set forth in such documents issued to the assignee as the Plan
Administrator may deem appropriate.
II.  INCENTIVE OPTIONS

     The terms specified below shall be applicable to all Incentive Options.
Except as modified by the provisions of this Section II, all the provisions
of Articles One, Two and Four shall be applicable to Incentive Options.
Options which are specifically designated as Non-Statutory Options when
issued under the Plan shall not be subject to the terms of this Section II.
     A.   Eligibility. Incentive Options may only be granted to Employees.
     B.   Exercise Price. The exercise price per share shall not be less than
one hundred percent (100%) of the Fair Market Value per share of Common Stock
on the option grant date.
     C.   Dollar Limitation. The aggregate Fair Market Value of the shares of
Common Stock (determined as of the respective date or dates of grant) for
which one or more options granted to any Employee under the Plan (or any
other option plan of the Corporation or any Parent or Subsidiary) may for the
first time become exercisable as Incentive Options during any one (1)
calendar year shall not exceed the sum of One Hundred Thousand Dollars
($100,000).  To the extent the Employee holds two (2) or more such options
which become exercisable for the first time in the same calendar year, the
foregoing limitation on the exercisability of such options as Incentive
Options shall be applied on the basis of the order in which such options are
granted.
     D.   10% Stockholder.  If any Employee to whom an Incentive Option is
granted is a 10% Stockholder, then the exercise price per share shall not be
less than one hundred ten percent (110%) of the Fair Market Value per share
of Common Stock on the option grant date, and the option term shall not
exceed five (5) years measured from the option grant date.
III. CORPORATE TRANSACTION/CHANGE IN CONTROL

     A.   In the event of any Corporate Transaction, each outstanding option
shall automatically accelerate so that each such option shall, immediately
prior to the effective date of the Corporate Transaction, become fully
exercisable for all of the shares of Common Stock at the time subject to such
option and may be exercised for any or all of those shares as fully-vested
shares of Common Stock.  However, an outstanding option shall not so
accelerate if and to the extent: (i) such option is, in connection with the
Corporate Transaction, either to be assumed by the successor corporation (or
parent thereof) or to be replaced with a comparable option to purchase shares
of the capital stock of the successor corporation (or parent thereof), (ii)
such option is to be replaced with a cash incentive program of the successor
corporation which preserves the spread existing on the unvested option shares
at the time of the Corporate Transaction and provides for subsequent payout
in accordance with the same vesting schedule applicable to such option or
(iii) the acceleration of such option is subject to other limitations imposed
by the Plan Administrator at the time of the option grant.  The determination
of option comparability under clause (i) above shall be made by the Plan
Administrator, and its determination shall be final, binding and conclusive.
     B.   All outstanding repurchase rights shall also terminate
automatically, and the shares of Common Stock subject to those terminated
rights shall immediately vest in full, in the event of any Corporate
Transaction, except to the extent: (i) those repurchase rights are to be
assigned to the successor corporation (or parent thereof) in connection with
such Corporate Transaction or (ii) such accelerated vesting is precluded by
other limitations imposed by the Plan Administrator at the time the
repurchase right is issued.

     C.   Immediately following the consummation of the Corporate
Transaction, all outstanding options shall terminate and cease to be
outstanding, except to the extent assumed by the successor corporation (or
parent thereof).

     D.   Each option which is assumed in connection with a Corporate
Transaction shall be appropriately adjusted, immediately after such Corporate
Transaction to apply to the number and class of securities which would have
been issuable to the Optionee in consummation of such Corporate Transaction
had the option been exercised immediately prior to such Corporate
Transaction. Appropriate adjustments to reflect such Corporate Transaction
shall also be made to (i) the exercise price payable per share under each
outstanding option, provided the aggregate exercise price payable for such
securities shall remain the same, (ii) the maximum number and/or class of
securities available for issuance over the remaining term of the Plan and
(iii) the maximum number and/or class of securities for which any one person
may be granted stock options, separately exercisable stock appreciation
rights and direct stock issuances in the aggregate under the Plan per
calendar year.

     E.   The Plan Administrator shall have full power and authority to grant
options under the Discretionary Option Grant Program which will automatically
accelerate in whole or in part in the event the Optionee's Service
subsequently terminates by reason of an Involuntary Termination within twelve
(12) months following the effective date of any Corporate Transaction in
which those options are assumed or replaced and do not otherwise accelerate.
Any options so accelerated shall remain exercisable for fully-vested shares
until earlier of (i) the expiration of the option term or (ii) the expiration
of the one (1)-year period measured from the effective date of the
Involuntary Termination.  In addition, the Plan Administrator may provide
that one or more of the Corporation's outstanding repurchase rights with
respect to shares held by the Optionee at the time of such Involuntary
Termination shall immediately terminate in whole or in part, and the shares
subject to those terminated rights shall accordingly vest.

     F.   The Plan Administrator shall have full power and authority to grant
options under the Discretionary Option Grant Program which will automatically
accelerate in whole or in part in the event the Optionee's Service
subsequently terminates by reason of an Involuntary Termination within twelve
(12) months following the effective date of any Change in Control.  Each
option so accelerated shall remain exercisable for fully-vested shares until
the earlier of (i) the expiration of the option term or (ii) the expiration
of the one (1)-year period measured from the effective date of the
Involuntary Termination.  In addition, the Plan Administrator may provide
that one or more of the Corporation' s outstanding repurchase rights with
respect to shares held by the Optionee at the time of such Involuntary
Termination shall immediately terminate in whole or in part, and the shares
subject to those terminated rights shall accordingly vest.
     G.   The portion of any Incentive Option accelerated in connection with
a Corporate Transaction or Change in Control shall remain exercisable as an
Incentive Option only to the extent the applicable One Hundred Thousand
Dollar ($100,000) limitation is not exceeded.  To the extent such dollar
limitation is exceeded, the accelerated portion of such option shall be
exercisable as a Statutory Option under the Federal laws.

     H.   The outstanding options shall in no way affect the right of the
Corporation to adjust, reclassify, reorganize or otherwise change its capital
or business structure or to merge, consolidate, dissolve, liquidate or sell
or transfer all or any part of its business or assets.
IV.  CANCELLATION AND RE-GRANT OF OPTIONS

     The Plan Administrator shall have the authority to effect, at any time
and from time to time, with the consent of the affected option holders, the
cancellation of any or all outstanding options under the Discretionary Option
Grant Program and to grant in substitution new options covering the same or
different number of shares of Common Stock but with an exercise price per
share based on the Fair Market Value per share of Common Stock on the new
grant date.
V.   STOCK APPRECIATION RIGHTS

     The Plan Administrator shall have full power and authority to grant
limited stock appreciation rights to one or more Section 16 Insiders with
respect to their outstanding options under this Article Two.  Upon the
occurrence of a Hostile Take-Over, each Section 16 Officer holding one or
more options with such a limited stock appreciation right in effect for at
least six (6) months shall have the unconditional right (exercisable for a
thirty (30)-day period following such Hostile Take-Over) to surrender each
such option to the Corporation, to the extent the option is at the time
exercisable for vested shares of Common Stock.  In return for the surrendered
option, the Optionee shall receive a cash distribution from the Corporation
in an amount equal to the excess of (A) the Take-Over Price of the shares of
Common Stock which are at the time vested under each surrendered option (or
surrendered portion thereof) over (B) the aggregate exercise price payable
for those shares. Such cash distribution shall be paid within five (5) days
following the option surrender date.  Neither the approval of the Plan
Administrator nor the consent of the Board shall be required in connection
with such option surrender and cash distribution.  The balance of the option
(if any) shall continue in full force and effect in accordance with the
documents evidencing such option.

                          ARTICLE THREE

                      STOCK ISSUANCE PROGRAM

I.   STOCK ISSUANCE TERMS

     Shares of Common Stock may be issued under the Stock Issuance Program
through direct and immediate issuances without any intervening option grants.
Each such stock issuance shall be evidenced by a Stock Issuance Agreement
which complies with the terms specified below.


     A.   Purchase Price.

          1.   The purchase price per share shall be fixed by the Plan
Administrator; provided, however, that in the case of a stock issuances
intended to qualify as "performance-based compensation" within the meaning of
Section 162(m) of the Code, the purchase price per share shall be no less
than 100% of the Fair Market Value per share on the issuance date.
          2.   Subject to the provisions of Section I of Article Four, shares
of Common Stock may be issued under the Stock Issuance Program for any of the
following items of consideration which the Plan Administrator may deem
appropriate in each individual instance:
               (i)  cash or check made payable to the Corporation, or
               (ii) past services rendered to the Corporation (or any Parent
or Subsidiary).
     B.   Vesting Provisions.

          1.   Shares of Common Stock issued under the Stock Issuance Program
may, in the discretion of the Plan Administrator, be fully and immediately
vested upon issuance or may vest in one or more installments over the
Participant's period of Service or upon attainment of specified performance
objectives.  The elements of the vesting schedule applicable to any unvested
shares of Common Stock issued under the Stock Issuance Program namely:
               (i)  the Service period to be completed by the Participant or
the performance objectives to be attained,

               (ii) the number of installments in which the shares are to
vest,
               (iii)     the interval or intervals (if any) which are to
lapse between installments, and

               (iv) the effect which death, Permanent Disability or other
event designated by the Plan Administrator is to have upon the vesting
schedule, shall be determined by the Plan Administrator and incorporated into
the Stock Issuance Agreement.
          2.   Any new, substituted or additional securities or other
property (including money paid other than as a regular cash dividend) which
the Participant may have the right to receive with respect to the
Participant's unvested shares of Common Stock by reason of any stock
dividend, stock split, recapitalization, combination of shares, exchange of
shares or other change affecting the outstanding Common Stock as a class
without the Corporation's receipt of consideration shall be issued subject to
(i) the same vesting requirements applicable to the Participant's unvested
shares of Common Stock and (ii) such escrow arrangements as the Plan
Administrator shall deem appropriate.
          3.   The Participant shall have full stockholder rights with
respect to any shares of Common Stock issued to the Participant under the
Stock Issuance Program, whether or not the Participant's interest in those
shares is vested.  Accordingly, the Participant shall have the right to vote
such shares and to receive any regular cash dividends paid on such shares.
          4.   Should the Participant cease to remain in Service while
holding one or more unvested shares of Common Stock issued under the Stock
Issuance Program or should the performance objectives not be attained with
respect to one or more such unvested shares of Common Stock, then those
shares shall be immediately surrendered to the Corporation for cancellation,
and the Participant shall have no further stockholder rights with respect to
those shares.  To the extent the surrendered shares were previously issued to
the Participant for consideration paid in cash or cash equivalent (including
the Participant's purchase-money indebtedness), the Corporation shall repay
to the Participant the cash consideration paid for the surrendered shares and
shall cancel the unpaid principal balance of any outstanding purchase-money
note of the Participant attributable to the surrendered shares.

          5.   The Plan Administrator may in its discretion waive the
surrender and cancellation of one or more unvested shares of Common Stock (or
other assets attributable thereto) which would otherwise occur upon the
cessation of the Participant's Service or the non-attainment of the
performance objectives applicable to those shares.  Such waiver shall result
in the immediate vesting of the Participant's interest in the shares of
Common Stock as to which the waiver applies. Such waiver may be effected at
any time, whether before or after the Participant's cessation of Service or
the attainment or non-attainment of the applicable performance objectives.
II.  CORPORATE TRANSACTION/CHANGE IN CONTROL

     A.   All of the Corporation's outstanding repurchase/cancellation rights
under the Stock Issuance Program shall terminate automatically, and all the
shares of Common Stock subject to those terminated rights shall immediately
vest in full, in the event of any Corporate Transaction, except to the extent
(i) those repurchase/cancellation rights are to be assigned to the successor
corporation (or parent thereof) in connection with such Corporate Transaction
or (ii) such accelerated vesting is precluded by other limitations imposed in
the Stock Issuance Agreement.
     B.   The Plan Administrator shall have the discretionary authority,
exercisable either at the time the unvested shares are issued or any time
while the Corporation's repurchase/cancellation rights remain outstanding
under the Stock Issuance Program, to provide that those rights shall
automatically terminate in whole or in part, and the shares of Common Stock
subject to those terminated rights shall immediately vest, in the event the
Participant's Service should subsequently terminate by reason of an
Involuntary Termination within twelve (12) months following the effective
date of any Corporate Transaction in which those repurchase/cancellation
rights are assigned to the successor corporation (or parent thereof).

     C.   The Plan Administrator shall have the discretionary authority,
exercisable either at the time the unvested shares are issued or any time
while the Corporation's repurchase/cancellation rights remain outstanding
under the Stock Issuance Program, to provide that those rights shall
automatically terminate in whole or in part, and the shares of Common Stock
subject to those terminated rights shall immediately vest, in the event the
Participant's Service should subsequently terminate by reason of an
Involuntary Termination within twelve (12) months following the effective
date of any Change in Control.

III. SHARE ESCROW/LEGENDS

     Unvested shares may, in the Plan Administrator's discretion, be held in
escrow by the Corporation until the Participants interest in such shares
vests or may be issued directly to the Participant with restrictive legends
on the certificates evidencing those unvested shares.

                           ARTICLE FOUR

                          MISCELLANEOUS

I.   FINANCING

     A.   The Plan Administrator may permit any Optionee or Participant to
pay the option exercise price under the Discretionary Option Grant Program or
purchase price of shares issued under the Stock Issuance Program by
delivering a full-recourse, interest bearing promissory note payable in one
or more installments.  The terms of any such promissory note (including the
interest rate and the terms of repayment) shall be established by the Plan
Administrator in its sole discretion.  In no event, however, shall the
maximum credit available to the Optionee or Participant exceed the sum of (i)
the aggregate option exercise price or purchase price payable for the
purchased shares plus (ii) any Federal, state and local income and employment
tax liability incurred by the Optionee or the Participant in connection with
the option exercise or share purchase.
     B.   The Plan Administrator may, in its discretion, determine that one
or more such promissory notes shall be subject to forgiveness by the
Corporation in whole or in part upon such as the Plan Administrator may deem
appropriate.

II.  TAX WITHHOLDING

     The Corporation's obligation to deliver shares of Common Stock upon the
exercise of stock options or stock appreciation rights or upon the issuance
or vesting of such shares under the Plan shall be subject to the satisfaction
of all applicable Federal, state and local income and employment tax
withholding requirements.

III. EFFECTIVE DATE AND TERM OF THE PLAN

     A.   The Plan shall become effective on the Plan Effective Date, which
is January 26, 1999.  Non-statutory options and non-statutory share grants
may be made immediately upon the Plan Effective Date.  However, no statutory
options granted under the Plan may be exercised until the Plan is approved by
the Corporation's stockholders. If such stockholder approval is not obtained
within twelve (12) months after the Plan Effective Date, then all statutory
options previously granted under this Plan shall terminate and cease to be
outstanding, and no further statutory options shall be granted.

     B.   The Plan shall terminate upon the earliest of (i) January 25, 2009,
(ii) the date on which all shares available for issuance under the Plan shall
have been issued pursuant to the exercise of the options or the issuance of
shares (whether vested or unvested) under the Plan or (iii) the termination
of all outstanding options in connection with a Corporate Transaction. Upon
such Plan termination, all outstanding stock options and unvested stock
issuances shall continue to have force and effect in accordance with the
provisions of the documents evidencing such options or issuances.
IV.  AMENDMENT OF THE PLAN

     A.   The Board shall have complete and exclusive power and authority to
amend or modify the Plan in any or all respects.  However, no such amendment
or modification shall adversely affect any rights and obligations with
respect to options, stock appreciation rights or unvested stock issuances at
the time outstanding under the Plan unless the Optionee or the Participant
consents to such amendment or modification.  In addition, the Board shall
not, without the approval of the Corporation's stockholders, (i) materially
increase the maximum number of shares issuable under the Plan, or the maximum
number of shares for which any one person may be granted options, separately
exercisable stock appreciation rights and direct stock issuances per calendar
year, except for permissible adjustments in the event of certain changes in
the Corporation's capitalization, (ii) materially modify the eligibility
requirements for Plan participation or (iii) materially increase the benefits
accruing to Plan participants.

     B.   Options to purchase shares of Common Stock may be granted under the
Discretionary Option Grant Program and shares of Common Stock may be issued
under the Stock Issuance Program that are in each instance in excess of the
number of shares then available for issuance under the Plan, provided any
excess shares actually issued under those programs are held in escrow until
there is obtained stockholder approval of an amendment sufficiently
increasing the number of shares of Common Stock available for issuance under
the Plan.  If such stockholder approval is not obtained within twelve (12)
months after the date the first such excess grants or issuances are made,
then (i) any unexercised options granted on the basis of such excess shares
shall terminate and cease to be outstanding and (ii) the Corporation shall
promptly refund to the Optionees and the Participants the exercise or
purchase price paid for any excess shares issued under the Plan and held in
escrow, together with interest (at the applicable Short Term Federal Rate)
for the period the shares were held in escrow, and such shares shall
thereupon be automatically canceled and cease to be outstanding.
V.   USE OF PROCEEDS

     Any cash proceeds received by the Corporation from the sale of shares of
Common Stock under the Plan shall be used for general corporate purposes.
VI.  REGULATORY APPROVALS

     A.   The implementation of the Plan, the granting of any option or stock
appreciation right under the Plan and the issuance of any shares of Common
Stock (i) upon the exercise of any option or stock appreciation right or (ii)
under the Stock Issuance Program shall be subject to the Corporation's
procurement of all approvals and permits required by regulatory authorities
having jurisdiction over the Plan, the options and stock appreciation rights
granted under it and the shares of Common Stock issued pursuant to it.

     B.   No shares of Common Stock or other assets shall be issued or
delivered under the Plan unless and until there shall have been compliance
with all applicable requirements of Federal and state securities laws,
including the filing and effectiveness of the Form S-8 registration statement
for the shares of Common Stock issuable under the Plan, and all applicable
listing requirements of any stock exchange (or the Nasdaq National Market or
OTC Bulletin Board, if applicable) on which Common Stock is then listed for
trading.

VII. NO EMPLOYMENT/SERVICE RIGHTS

     Nothing in the Plan shall confer upon the Optionee or the Participant
any right to continue in Service for any period of specific duration or
interfere with or otherwise restrict in any way the rights of the Corporation
(or any Parent or Subsidiary employing or retaining such person) or of the
Optionee or the Participant, which rights are hereby expressly reserved by
each, to terminate such person's Service at any time for any reason, with or
without cause.

                             APPENDIX

          The following definitions shall be in effect under the Plan:
     A.   Board shall mean the Corporation's Board of Directors.
     B.   Change in Control shall mean a change in ownership or control of
the Corporation effected through either of the following transactions:

          1.   the acquisition, directly or indirectly, by any person or
related group of persons (other than the Corporation or a person that
directly or indirectly controls, is controlled by, or is under common control
with, the Corporation), of beneficial ownership (within the meaning of Rule
l3d-3 of the 1934 Act) of securities possessing more than fifty percent (50%)
of the total combined voting power of the Corporation's outstanding
securities pursuant to a tender or exchange offer made directly to the
Corporation's stockholders which the Board does not recommend such
stockholders to accept, or

          2.   a change in the composition of the Board over a period of
thirty-six (36) consecutive months or less such that a majority of the Board
members ceases, by reason of one or more contested elections for Board
membership, to be comprised of individuals who either (A) have been Board
members continuously since the beginning of such period or (B) have been
elected or nominated for election as Board members during such period by at
least a majority of the Board members described in clause (A) who were still
in office at the time the Board approved such election or nomination.

     C.   Code shall mean the Internal Revenue Code of 1986, as amended.
     D.   Committee shall mean the Stock Option Committee and any
sub-committee of the Stock Option Committee appointed by the Board to
administer the Plan.
     E.   Common Stock shall mean the Corporation's common stock.
     F.   Corporate Transaction shall mean either of the following
stockholder approved transactions to which the Corporation is a party:

          1.   a merger or consolidation in which securities possessing more
than fifty percent (50%) of the total combined voting power of the
Corporation's outstanding securities are transferred to a person or persons
different from the persons holding those securities immediately prior to such
transaction; or

          2.   the sale, transfer or other disposition of all or
substantially all of the Corporation's assets in complete liquidation or
dissolution of the Corporation.
     G.   Corporation shall mean DYNASIL CORPORATION OF AMERICA, a New Jersey
corporation and any corporate successor to all or substantially all of the
assets or voting stock of DYNASIL CORPORATION OF AMERICA which shall by
appropriate action adopt the Plan.
     H.   Discretionary Option Grant Program shall mean the discretionary
option grant program in effect under the Plan.

     I.   Domestic Relations Order shall mean any judgment, decree or order
(including approval of a property settlement agreement) which provides or
otherwise conveys, pursuant to applicable State domestic relations laws
(including community property laws), marital property rights to any spouse or
former spouse of the Optionee.

     J.   Employee shall mean an individual who is in the employ of the
Corporation (or any Parent or Subsidiary), subject to the control and
direction of the employer entity as to both the work to be performed and the
manner and method of performance.

     K.   Exercise Date shall mean the date on which the Corporation shall
have received written notice of the option exercise.

     L.   Fair Market Value per share of Common Stock on any relevant date
shall be determined in accordance with the following provisions:

               (i)  If the Common Stock is quoted on the OTC Bulletin Board
or in the Pink Sheets operated by the National Quotation Bureau, then the
Fair Market Value shall be the bid price per share (as determined by the Plan
Administrator) of Common Stock on the date in question, as such price is
reported by the OTC Bulletin Board, the Pink Sheets, or any successor system.
If there is no bid price available for the Common Stock on the date in
question, then the Fair Market Value shall be the bid price on the last
preceding date for which such quotation exists.
               (ii) If the Common Stock is at the time traded on the Nasdaq
National Market, then the Fair Market Value shall be the closing selling
price per share of Common Stock on the date in question, as such price is
reported by the National Association of Securities Dealers on the Nasdaq
National Market or any successor system.  If there is no closing selling
price for the Common Stock on the date in question, then the Fair Market
Value shall be the closing selling price on the last preceding date for which
such quotation exists.
               (iii)     If the Common Stock is at the time listed on any
Stock Exchange, then the Fair Market Value shall be the closing selling price
per share of Common Stock on the date in question on the Stock Exchange
determined by the Plan Administrator to be the primary market for the Common
Stock, as such price is officially quoted in the composite tape of
transactions on such exchange.  If there is no closing selling price for the
Common Stock on the date in question, then the Fair Market Value shall be the
closing selling price on the last preceding date for which such quotation
exists.

               (iv) If no quotation for the Common Stock is available as
stated above, the Fair Market Value shall be determined by the Plan
Administrator, after taking into account such factors as it deems
appropriate.

     M.   Hostile Take-Over shall mean a change in ownership of the
Corporation effected through the following transaction:

               (i)  the acquisition, directly or indirectly, by any person or
related group of persons (other than the Corporation or a person that
directly or indirectly controls, is controlled by, or is under common control
with, the Corporation) of beneficial ownership (within the meaning of Rule
l3d-3 of the 1934 Act) of securities possessing more than fifty percent (50%)
of the total combined voting power of the Corporation's outstanding
securities pursuant to a tender or exchange offer made directly to the
Corporation's stockholders which the Board does not recommend such
stockholders to accept, and

               (ii) more than fifty percent (50%) of the securities so
acquired are accepted from persons other than Section 16 Insiders.

     N.   Incentive Option shall mean an option which satisfies the
requirements of Code Section 422.

     O.   Involuntary Termination shall mean the termination of the Service
of any individual which occurs by reason of:

               (i)  such individual's involuntary dismissal or discharge by
the Corporation for reasons other than Misconduct, or

               (ii) such individual's voluntary resignation following (A) a
change in his or her position with the Corporation which materially reduces
his or her level of responsibility, (B) a reduction in his or her level of
compensation (including base salary, fringe benefits and participation in
corporate-performance based bonus or incentive programs) by more than fifteen
percent (15%) or (C) a relocation of such individual's place of employment by
more than fifty (50) miles, provided and only such change, reduction or
relocation is effected by the Corporation without the individual's consent.

     P.   Misconduct shall mean the commission of any act of fraud,
embezzlement or dishonesty by the Optionee or Participant, any unauthorized
use or disclosure by such person of confidential information or trade secrets
of the Corporation (or any Parent or Subsidiary), or any other intentional
misconduct by such person adversely affecting the business or affairs of the
Corporation (or any Parent or Subsidiary) in a material manner.  The
foregoing definition shall not be deemed to be inclusive of all the acts or
omissions which the Corporation (or any Parent or Subsidiary) may consider as
grounds for the dismissal or discharge of any Optionee, Participant or other
person in the Service of the Corporation (or any Parent or Subsidiary).
     Q.   1934 Act shall mean the Securities Exchange Act of 1934, as
amended.
     R.   Non-Statutory Option shall mean an option not intended to satisfy
the requirements of Code Section 422.

     S.   Optionee shall mean any person to whom an option is granted under
the Discretionary Option Grant.

     T.   Parent shall mean any corporation (other than the Corporation) in
an unbroken chain of corporations ending with the Corporation, provided each
corporation in the unbroken chain (other than the Corporation) owns, at the
time of the determination, stock possessing fifty percent (50%) or more of
the total combined voting power of all classes of stock in one of the other
corporations in such chain.

     U.   Participant shall mean any person who is issued shares of Common
Stock under the Stock Programs.

     V.   Permanent Disability or Permanently Disabled shall mean the
inability of the Optionee or the Participant to engage in any substantial
gainful activity by reason of any medically determinable physical or mental
impairment expected to result in death or to be of continuous duration of
twelve (12) months or more.

     W.   Plan shall mean the Corporation's 1999 Stock Incentive Plan, as set
forth in this document.

     X.   Plan Administrator shall mean the Committee or the sub-committee
which is authorized to administer the Plan with respect to one or more
classes of eligible persons, to the extent such entity is carrying out its
administrative functions under those programs with respect to the persons
under its jurisdiction.

     Y.   Plan Effective Date shall mean January 26, 1999.
     Z.   Qualified Domestic Relations Order shall mean a Domestic Relations
Order which substantially complies with the requirements of Code Section
414(p), The Plan Administrator shall have the sole discretion to determine
whether a Domestic Relations Order is a Qualified Domestic Relations Order.

     AA.  Section 16 Insider shall mean an officer or director of the
Corporation subject to the short-swing profit liabilities of Section 16 of
the 1934 Act.
     BB.  Service shall mean the provision of services to the Corporation (or
any Parent or Subsidiary) by a person in the capacity of an Employee, a
non-employee member of the board of directors or a consultant or independent
advisor, except to the extent otherwise specifically provided in the
documents evidencing the option grant or stock issuance.
     CC.  Stock Exchange shall mean either the American Stock Exchange or the
New York Stock Exchange.

     DD.  Stock Issuance Agreement shall mean the agreement entered into by
the Corporation and the Participant at the time of issuance of shares of
Common Stock under the Stock Issuance Program.

     EE.  Stock Issuance Program shall mean the stock issuance program in
effect under the Plan.

     FF.  Subsidiary shall mean any corporation (other than the Corporation)
in an unbroken chain of corporations beginning with the Corporation, provided
each corporation (other than the last corporation) in the unbroken chain
owns, at the time of the determination, stock possessing fifty percent (50%)
or more of the total combined voting power of all classes of stock in one of
the other corporations in such chain.

     GG.  Take-Over Price shall mean the greater of (i) the Fair Market Value
per share of Common Stock on the date the option is surrendered to the
Corporation in connection with a Hostile Take-Over or (ii) the highest
reported price per share of Common Stock paid by the tender offeror in
effecting such Hostile Take-Over.  However, if the surrendered option is an
Incentive Option, the Take-Over Price shall not exceed the clause (i) price
per share.
     HH.  10% Stockholder shall mean the owner of stock (as determined under
Code Section 424(d)) possessing more than ten percent (10%) of the total
combined voting power of all classes of stock of the Corporation (or any
Parent or Subsidiary).

                  DYNASIL CORPORATION OF AMERICA

                   EMPLOYEE STOCK PURCHASE PLAN

                     AS AMENDED JULY 25, 2000


     I.   PURPOSE OF THE PLAN

     This Employee Stock Purchase Plan is intended to promote the interests
of Dynasil Corporation of America by providing eligible employees with the
opportunity to acquire a proprietary interest in the Corporation through
participation in an employee stock purchase plan designed to qualify under
Section 423 of the Code.

     Capitalized terms herein shall have the meanings assigned to such terms
in the attached Appendix as set forth in the text.

     II.  ADMINISTRATION OF THE PLAN

     The Plan Administrator shall have full authority to interpret and
construe any provision of the Plan and to adopt such rules and regulations
for administering the Plan as it may deem necessary in order to comply with
the requirements of Code Section 423.  Decisions of the Plan Administrator
shall be final and binding on all parties having an interest in the Plan.
     III. STOCK SUBJECT TO PLAN

     A.   The stock purchasable under the Plan shall be shares of authorized
but unissued or reacquired Common Stock, including shares of Common Stock
purchased on the open market.  The maximum number of shares of Common Stock
which may be issued over the term of the Plan shall not exceed One Hundred
Fifty Thousand (150,000) shares (as adjusted for splits and dividends).
     B.   Should any change be made to the Common Stock by reason of any
stock split, stock dividend, recapitalization, combination of shares,
exchange of shares or other change affecting the outstanding Common Stock as
a class without the Corporation's receipt of consideration, appropriate
adjustments shall be made to (i) the maximum number and class of securities
issuable under the Plan, (ii) the maximum number and class of securities
purchasable per Participant on any one Purchase Date and (iii) the number and
class of securities and the price per share in effect under each outstanding
purchase right in order to prevent the dilution or enlargement of benefits
thereunder.
     IV.  OFFERING PERIODS

     A.   Shares of Common Stock shall be offered for purchase under the Plan
through a series of successive offering periods until such time as (i) the
maximum number of  shares of Common Stock available for issuance under the
Plan shall have been purchased or (ii) the Plan shall have been sooner
terminated.

     B.   Each offering period shall be twelve (12) months.   All offering
periods shall commence on January 1 and end on December 31 of each year.
     V.   ELIGIBILITY

     A.   Each individual who is an Eligible Employee during any offering
period may purchase shares during that offering period, provided he or she
remains an Eligible Employee.
     B.   To participate in the Plan for a particular offering period, the
Eligible Employee must complete forms prescribed by the Plan Administrator.

     VI.  PURCHASE RIGHTS

     A.   Grant of Purchase Right.  A Participant shall be granted a separate
purchase right for each offering period.  The purchase right shall provide
the Participant with the right to purchase shares of Common Stock, in a
series of successive installments over the remainder of such offering period,
upon the terms set forth below.  The Participant shall execute a stock
purchase agreement embodying such terms and such other provisions (not
inconsistent with the Plan) as the Plan Administrator may deem advisable.

     Under no circumstances shall purchase rights be granted under the Plan
to any Eligible Employee if such individual would, immediately after the
grant, own (within the meaning of Code Section 424(d)) or hold outstanding
options or other rights to purchase, stock possessing five percent (5%) or
more of the total combined voting power or value of all classes of stock of
the Corporation or any Corporate Affiliate.

     B.   Exercise of the Purchase Right.   The purchase right shall be
exercised within the offering period by a Participant exercising the
appropriate purchase request and paying the purchase price.  Shares of Common
Stock shall accordingly be purchased on behalf of each Participant.  Upon the
expiration of the offering period, any unexercised rights shall terminate as
to that offering period.
     C.   Purchase Price. The purchase price per share at which Common Stock
will be purchased on the Participant's behalf shall be equal to eighty-five
percent (85%) of the Fair Market Value per share of Common Stock on the date
that the Purchase Price is paid; provided, however, that the Purchase Price
may be adjusted by the Board pursuant to Section IX.
     D.   Number of Purchasable Shares.  During any twelve (12) month period,
an Employee shall be prohibited from purchasing pursuant to the Employee
Stock Purchase Plan, more than that number of shares for which the total
purchase price is $5,000.  This means, for example, if the purchase price is
$5.00 per share, then an employee may purchase no more than 1,000 shares
during any twelve (12) month offering period.

     Should the Participant cease to remain an Eligible  Employee for any
reason (including death, disability or change in status), then his or her
purchase right shall immediately terminate.
     E.   Proration of Purchase Rights.  Should the total number of shares of
Common Stock to be purchased pursuant to outstanding purchase rights on any
particular date exceed the number of shares then available for issuance under
the Plan, the Plan Administrator shall make a pro-rata allocation of the
available shares on a uniform and nondiscriminatory basis.
     F.   Assignability.  The purchase right shall be exercisable only by the
Participant and shall not be assignable or transferable by the Participant.

     G.   Stockholder Rights.  A Participant shall have no stockholder rights
with respect to the shares subject to his or her outstanding purchase right
until the shares are purchased by the Participant in accordance with the
provisions of the Plan and the Participant has become a holder of record of
the purchased shares.

     VII. ACCRUAL LIMITATIONS

     A.   No Participant shall be entitled to accrue rights to acquire Common
Stock pursuant to any purchase right outstanding under this Plan if and to
the extent such accrual, when aggregated with (i) rights to purchase Common
Stock accrued under any other purchase right granted under this Plan and (ii)
similar rights accrued under other employee stock purchase plans (within the
meaning of Code Section 423) of the Corporation or any Corporate Affiliate,
would otherwise permit such Participant to purchase more than Twenty-Five
Thousand Dollars ($25,000) worth of stock of the Corporation or any Corporate
Affiliate (determined on the basis of the Fair Market Value per share on the
date or dates such rights are granted) for each calendar year such rights are
at any time outstanding.

     B.   For purposes of applying such accrual limitations to the purchase
rights granted under the Plan, the following provisions shall be in effect:

          i.   The right to acquire Common Stock under each outstanding
purchase right shall accrue on the first day of the offering period.

          ii.  No right to acquire Common Stock under any outstanding
purchase right shall accrue to the extent the Participant has already accrued
in the same calendar year the right to acquire Common Stock under one (1) or
more other purchase rights at a rate equal to Twenty-Five Thousand Dollars
($25,000) worth of Common Stock (determined on the basis of the Fair Market
Value per share on the date or dates of grant) for each calendar year such
rights were at any time outstanding.
     C.   In the event there is any conflict between the provisions of this
Article and one or more provisions of the Plan or any instrument issued
thereunder, the provisions of this Article shall be controlling.

          VIII.     EFFECTIVE DATE AND TERM OF THE PLAN

     A.   The Plan was adopted by the Board and the shareholders on January
26, 1999, and became effective on that date.

     B.   Unless sooner terminated by the Board, the Plan shall terminate
upon the earliest of (i) January 25, 2009, or (ii) the date on which all
shares available for issuance under the Plan shall have been sold pursuant to
purchase rights exercised under the Plan.  No further purchase rights shall
be granted or exercised under the Plan following its termination.
     IX.  AMENDMENT OF THE PLAN

     The Board may alter, amend, suspend or discontinue the Plan at any time.
However, the Board may not, without the approval of the Corporation's
stockholders, (i) materially increase the number of shares of Common Stock
issuable under the Plan or the maximum number of shares purchasable per
Participant during any offering period, except for permissible adjustments in
the event of certain changes in the Corporation's capitalization, (ii) alter
the purchase price formula so as to reduce the purchase price payable for the
shares of Common Stock purchasable under the Plan, or (iii) materially
increase the benefits accruing to Participants under the Plan or materially
modify the requirements for eligibility to participate in the Plan.
Notwithstanding the above, in the event the Board determines that the ongoing
operation of the Plan may result in unfavorable financial accounting
consequences, the Board may, in its discretion and, to the extent necessary
or desirable, modify or amend the Plan to reduce or eliminate such accounting
consequence including, but not limited to (i) altering the purchase price for
any offering period including an offering period underway at the time of the
change in purchase price, (ii) shortening any offering period, including an
offering period underway at the time of the Board action; and (iii)
allocating shares. Such modifications or amendments shall not require
stockholder approval or the consent of any Plan Participants.
     X.   GENERAL PROVISIONS

     A.   Nothing in the Plan shall confer upon the Participant any right to
continue in the employ of the Corporation or any Corporate Affiliate for any
period of specific duration or interfere with or otherwise restrict in any
way the rights of the Corporation (or any Corporate Affiliate employing such
person) or of the Participant, which rights are hereby expressly reserved by
each, to terminate such person's employment at any time for any reason, with
or without cause.
     B.   All costs and expenses incurred in the administration of the Plan
shall be paid by the Corporation.

     C.   The provisions of the Plan shall be governed by the laws of the
State of New Jersey without resort to that State's conflict-of-laws rules.


                             APPENDIX

     The following definitions shall be in effect under the Plan:
     A.   Board shall mean the Corporation's Board of Directors.
     B.   Code shall mean the Internal Revenue Code of 1986, as amended.
     C.   Common Stock shall mean the Corporation's common stock.
     D.   Corporate Affiliate shall mean any parent or subsidiary corporation
of the Corporation (as determined in accordance with Code Section 424),
whether now existing or subsequently established.

     E.   Corporation shall mean Dynasil Corporation of America, a New Jersey
corporation, and any corporate successor to all or substantially all of the
assets or voting stock of Dynasil Corporation of America which shall by
appropriate action adopt the Plan.
     F.   Eligible Employee shall mean any person who is employed by the
Corporation on a basis under which he or she is regularly expected to render
more than twenty (20) hours of service per week, and has been employed for
more than three (3) months for earnings considered wages under Code Section
3401(a).

     G.   Entry Date shall mean the date an Eligible Employee first commences
participation in the offering period in effect under the Plan.

     H.   Fair Market Value per share of Common Stock on any relevant date
shall be determined in accordance with the following provisions:

          i.   If the Common Stock is at the time quoted on the OTC Bulletin
Board, then the Fair Market Value shall be the average bid price per share on
the date in question, as such price is quoted on the OTC Bulletin Board.
If there is no average bid price for the Common Stock on the date in
question, then the Fair Market Value shall be the closing bid price on the
last preceding date for which such quotation exists.

          ii.  If the Common Stock is at the time traded on the Nasdaq
SmallCap Market or Nasdaq National Market, then the Fair Market Value shall
be the closing selling price per share of Common Stock on the date in
question, as such price is reported by the National Association of Securities
Dealers on such Nasdaq Market or any successor system.  If there is no
closing selling price for the Common Stock on the date in question, then the
Fair Market Value shall be the closing selling price on the last preceding
date for which such quotation exists.
          iii. If the Common Stock is at the time listed on any Stock
Exchange, then the Fair Market Value shall be the closing selling price per
share of Common Stock on the date in question on the Stock Exchange
determined by the Plan Administrator to be the primary market for the Common
Stock, as such price is officially quoted in the composite tape of
transactions on such exchange.  If there is no closing selling price for the
Common Stock on the date in question, then the Fair Market Value shall be the
closing selling price on the last preceding date for which such quotation
exists.

     I.   1933 Act shall mean the Securities Act of 1933, as amended.
     J.   Participant shall mean any Eligible Employee of the Corporation.
     K.   Corporation shall mean the Corporation and such Corporate Affiliate
or Affiliates as may be authorized from time to time by the Board to extend
the benefits of the Plan to their Eligible Employees.

     L.   Plan shall mean the Corporation's Employee Stock Purchase Plan, as
set forth in this document.

     M.   Plan Administrator shall mean a committee appointed by the Board to
administer the Plan.

     N.   Stock Exchange shall mean either the American Stock Exchange or the
New York Stock Exchange.




                                                                  EXHIBIT 23.1




                          Consent of Independent Accountants

                                ----------------------

         As independent accountants, we hereby consent to the incorporation by
reference in this registration statement of our reports included in Dynasil
Corporation of America's Form 10-KSB for the year ended September 30, 1999, and
to all references to our Firm included in this registration statement.

                                        Haefele, Flanagan & Co., p.c.


Maple Shade, New Jersey
September 19, 2000