EXHIBIT 10.1


TEXT OF PROPOSED AMENDMENT TO nSTOR'S 2001 STOCK OPTION PLAN


        5.     COMMON STOCK

The capital stock of nStor that may be issued  pursuant to Options granted under
the Plan shall be shares of common stock,  with $0.05 value per share,  of nStor
(the "Common  Stock"),  which shares may be treasury  shares or  authorized  but
unissued  shares.  The total number of shares of Common Stock that may be issued
pursuant to Options  granted  under the Plan shall be Seven Million Five Hundred
Thousand (7,500,000),  subject to adjustment as provided in Section 15 below. If
any Option  expires,  terminates,  or is  terminated  or canceled for any reason
prior to exercise in full,  the shares of Common  Stock that were subject to the
unexercised portion of such Option shall be available for future Options granted
under the Plan.