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                                                                     EXHIBIT 4.1


                                   EXHIBIT 4.1

                          PICTUREWORKS TECHNOLOGY, INC.

                             1994 STOCK OPTION PLAN


         1. Purpose. This 1994 Stock Option Plan (the "Plan") is intended to
provide incentives (a) to the employees of PictureWorks Technology, Inc. (the
"Company"), its parent (if any), and any present or future subsidiaries of the
Company (collectively, "Related Corporations") by providing them with
opportunities to purchase stock in the Company pursuant to options which qualify
as "incentive stock options" under Section 422A(b) of the Internal Revenue Code
of 1986, as amended (the "Code"), granted hereunder ("ISO" or "ISOs"); and (b)
to directors, employees and consultants of the Company and Related Corporations
by providing them with opportunities to purchase stock in the Company pursuant
to options granted hereunder which do not qualify as ISOs ("Non-Qualified
Option") or "Non-Qualified Options"). Both ISOs and Non-Qualified Options are
referred to hereafter individually as an "Option" and collectively as "Options."
As used herein, the terms "parent" and "subsidiary" mean "parent corporation"
and "subsidiary corporation" as those terms are defined in Section 425 of the
Code.

         2. Administration of the Plan.

                  (a) The Plan shall be administered by the Board of Directors
of the Company (the "Board"). The Board may appoint a Stock Option Plan
Committee (the "Committee") of three (3) or more of its members to administer
this Plan. No member of the Committee, while a member, shall be eligible to
participate in this Plan. Subject to ratification of the grant of each Option by
the Board (if so required by applicable state law), and subject to the terms of
the Plan, the Committee, if so appointed, shall have the authority to (i)
determine the employees of the Company and Related Corporations (from among the
class of employees eligible under paragraph 3 to receive ISOs) to whom ISOs may
be granted, and to determine (from among the class of individuals and entities
eligible under paragraph 3 to received Non-Qualified Options) to whom
Non-Options may be granted; (ii) determine the time or times at which Options
may be granted; (iii) determine the option price of shares subject to each
Option, which price with respect to ISOs shall not be less than the minimum
specified in paragraph 6; (iv) determine whether each Option granted shall be an
ISO or a Non-Qualified Option; (v) determine (subject to paragraph 7) the time
or times when each Option shall become exercisable and the duration of the
exercise period; (vi) determine whether restrictions such as repurchase options
are to be imposed on shares subject to Options, and the nature of such
restrictions if any, and (vii) interpret the Plan and prescribe and rescind
rules and regulations relating to it. If the Committee determines to issue a
Non-Qualified Option, it shall take whatever actions it deems necessary, under
Section 422A of the Code and the regulations promulgated thereunder, to ensure
that such Option is not treated as an ISO. The interpretation and construction
by the Committee of any provisions of the Plan or of any Option granted under it
shall be final unless otherwise determined by the Board. The Committee may from
time to time adopt such rules and regulations for carrying out the Plan as it
may deem best. No member of the Board or the Committee shall be liable for any
action or determination made in good faith with respect to the Plan or any
Option granted under it.

                  (b) The Committee may select one of its members as its
chairman, and shall hold meetings at such time and place as it may determine.
Acts by a majority of the Committee, or acts reduced to or approved in writing
by a majority of the members of the Committee, shall be the valid acts of the
Committee. All references in this Plan to the Committee shall mean the Board if
no Committee has been appointed. From time to time the Board may increase the
size of the Committee and appoint additional members thereof, remove members
(with or without cause) and appoint new members in substitution therefor, fill
vacancies however caused, or remove all members of the Committee and thereafter
directly administer the Plan.

                  (c) Notwithstanding the provisions of paragraph 2(a), no
Option shall be granted to any person who is, at the time of the proposed grant,
a member of the Board, unless such grant has been approved by a majority vote of
the disinterested members of the Board. All grants of Options to members of the
Board, shall in all other respects be made in accordance with the provisions of
this Plan applicable to other eligible persons. Members of the Board who are
either (i)


                                 Exhibit 4.1.1
<PAGE>   2

eligible for Options pursuant to the Plan or (ii) have been granted Options, may
vote on any matters affecting the administration of the Plan or the grant of any
Options pursuant to the Plan, except that no such member shall act upon the
granting to himself of Options, but any such member may be counted in
determining the existence of a quorum at any meeting of the Board during which
action is taken with respect to the granting to him of Options.

                  (d) Notwithstanding any other provision of this paragraph 2,
in the event the Company registers any class of any equity security pursuant to
Section 12 of the Securities Exchange Act of 1934, as amended (the "Exchange
Act"), any registration until six (6) months after the termination of such
registration shall be made only by the Board; provided, however, that if a
majority of the Board is eligible to participate in the Plan or in any other
stock option or other stock plan of the Company or any of its affiliates, or has
been so eligible at any time within the preceding year, any grant to directors,
of Options must be made by, or only in accordance with recommendation of, a
Committee consisting of three (3), or more persons, who may but need not be
directors or employees of the Company , appointed by the Board but having full
authority to act in the matter, none of whom is eligible to participate in this
Plan or any other stock option or other stock plan of the Company, or any of its
affiliates, or has been eligible at any time within the preceding year. The
requirements imposed by the preceding sentence shall also apply with respect to
grants to officers who are not also directors. Once appointed, the Committee
shall continue to serve until otherwise directed by the Board.

         3. Eligible Employees and Others. ISOs may be granted to any employee
of the Company or any Related Corporation. Those directors of the Company who
are not employees may not be granted ISOs under the Plan. Non-Qualified Options
may be granted to any director (whether or not an employee), employee or
consultant of the Company or any Related Corporation. In determining the persons
to whom ISOs shall be granted, the Committee shall take into consideration the
duties of the respective person, their present and potential contributions to
the success of the Company and such other factors as the Committee shall deem
relevant in determining whether to grant an ISO or a Non-Qualified Option
Granting of any Option to any individual or entity shall neither entitle that
individual or entity to, nor disqualify him from, participation in any other
grant or Options.

         4. Stock. The stock subject to Options shall be authorized but unissued
shares of Common Stock of the Company, no par value (the "Common Stock"), or
shares of Common Stock reacquired by the Company in any manner. The aggregate
number of shares which may be issued pursuant to the Plan is two thousand
(2,000), subject to adjustment as provided in paragraph 13. Any such shares may
be issued as ISOs or Non-Qualified Options so long as the number of shares so
issued does not exceed such number, as adjusted. If any Option granted under the
Plan shall expire or terminate for any reason without having been exercised in
full or shall cease for any reason to be exercisable in whole or in part, the
unpurchased shares subject thereto shall again be available for grants of
Options under the Plan.

         5. Granting of Options. Options may be granted under the Plan at any
time after September 1, 1994 and prior to August 31, 2004. Any grants of Options
shall be subject to the receipt, within twelve (12) months of August 1, 1995, of
the approval of Stockholders as provided in paragraph 15. The date of grant of
an Option under the Plan will be the date specified by the Committee at the time
it grants the Option. The Committee shall have the right, with the consent of
the optionee, to convert an ISO granted under the Plan to a Non-Qualified Option
pursuant to paragraph 16.

         6. Minimum Option Price; ISO Limitations.

                  (a) The price per share specified in the Agreement relating to
each Non-Qualified Option granted under the Plan shall in no event be less than
the lesser of (i) the book value per share of Common Stock as of the end of the
fiscal year of the Company immediately preceding the date of such grant, or (ii)
fifty (50%) percent of the Fair Market Value per share of Common Stock on the
date of such grant.

                  (b) The price per share specified in the Agreement relating to
each ISO granted under the Plan shall not be less than the Fair Market Value per
share of Common Stock on the date of such grant. In the case of an ISO to be
granted to any employee owning stock possessing more than ten percent (10%) of
the total combined voting power of all classes of stock of the Company or any
Related Corporation, the price per share specified in the agreement relating to
such ISO shall not be less than one hundred and ten percent (110%) of the Fair
Market Value of Common Stock on the date of grant.


                                 Exhibit 4.1.2
<PAGE>   3

                  (c) The aggregate Fair Market Value of the shares of Common
Stock with respect to which Options granted under this Plan and all other option
plans of the Company and any Subsidiary become exercisable for the first time by
an Optionee during any calendar year shall not exceed one hundred thousand
($100,000) dollars.

         7. Option Duration. Subject to earlier termination as provided in
paragraphs 9 and 10, an Option shall expire on the date specified by the
Committee, but not more than (i) ten (10) years and one (1) day from the date of
grant in the case of Non-Qualified Options, (ii) ten (10) years from the date of
grant in the case of ISOs generally, and (iii) five (5) years from the date of
grant in the case of ISOs granted to employee owning stock possessing more than
ten (10) percent of the total combined voting power of all classes of stock of
the Company or any Related Corporation. Subject to earlier termination as
provided in paragraphs 9 and 10, the Term of each ISO shall be the Term set
forth in the original instrument granting such ISO, except with respect to any
part of such ISO that is converted into a Non-Qualified Option pursuant to
paragraph 16.

         8. Exercise of Option. Subject to the provisions of paragraphs 9
through 12, each Option granted under the Plan shall be exercisable as follows:

                  (a) The Option shall either be fully exercisable on the date
of grant or shall become exercisable thereafter in such installments as the
Committee may specify.

                  (b) Once an installment becomes exercisable it shall remain
until expiration or termination of the Option, unless otherwise specified by the
Committee.

                  (c) Each Option or installment may be exercised at any time,
or from time to time, in whole or in part, and upon the terms and conditions
that the Committee may determine as reflected in the Stock Option Agreement, for
up to the total number of shares with respect to which it is then exercisable.
An option may be exercised as to any, or all full shares, of Common Stock as to
which the option has become exercisable, by giving written notice of such
exercise to the Committee.

                  (d) The Committee shall have the right to accelerate the date
of exercise of any installment of any Option; provided that the Committee shall
not accelerate the exercise date of any installment of any Option granted to any
employee as an ISO (and not previously converted into a Non-Qualified Option
pursuant to paragraph 16) if such acceleration would violate the annual vesting
limitation contained in Section 442A(b)(7) of the Code, as amended, which
provides generally that the aggregate Fair Market Value (determined at the time
the option is granted) of the stock with respect to which ISOs granted to any
employee are exercisable for the first time by such employee during any calendar
year (under all plans of the Company and any Related Corporation) shall not
exceed $100,000.00.

         9. Termination of Employment. If an ISO optionee ceases to be employed
by the Company and all Related Corporations other than by reason of death or
disability as defined in paragraph 10, no further installments of his ISOs shall
become exercisable, and his ISOs shall terminate after the passage of sixty (60)
days from the date of said termination, but in no event later than on their
specified expiration dates, except to the extent that such ISOs (or unexercised
installments thereof) have been converted into Non-Qualified Options pursuant to
paragraph 16. A leave of absence with the written approval of the Committee
shall not be considered an interruption of employment under the Plan, provided
that such written approval contractually obligates the Company, or any Related
Corporation to continue the employment of the employee after the approved period
of absence. Employment shall also be considered as continuing uninterrupted
during any other bona fide leave of absence (such as those attributable to
illness, military obligations or governmental service) provided that the period
of such leave does not exceed ninety (90) days or, if longer, any period during
which such employee's right to reemployment is guaranteed by statutes. ISOs
granted under the Plan shall not be affected by any change of employment within
or among the Company and Related Corporations, so long as the employee continues
to be an employee of the Company or any Related Corporation. Nothing in the Plan
shall be deemed to give any grantee of any Option the right to be retained in
employment or other services by the Company or any Related Corporation for any
period of time. In granting any Non-Qualified Option, the Committee may specify
that such Non-Qualified Option shall be subject to the restrictions set forth
herein with respect to ISOs or to such other termination or cancellation
provisions as the Committee may determine.


                                 Exhibit 4.1.3
<PAGE>   4


         10. Death; Disability; Dissolution. If an ISO optionee shall die while
employed by the Company, or any Related Corporation, any ISO of his may be
exercised, to the extent of the number of shares with respect to which he could
have exercised it on the date of his death, by his estate, personal
representative or beneficiary who has acquired the ISO by will or by the laws of
the descent and distribution, at any time prior to the earlier of the ISO's
specified expiration date or one hundred, eighty (180) days from the date of the
optionee's death.

         If an ISO optionee ceases to be employed by the Company, or any Related
Corporation, by reason of his disability, he shall have the right to exercise
any ISO held by him on the date of termination of employment, to the extent of
the number of shares with respect to which he could have exercised it on that
date, at any time prior to the earlier of the ISO's specified expiration date or
one hundred, eighty (180) days from the date of the termination of the
optionee's employment. For the purposes of the Plan, the term "disability" shall
mean permanent and total disability as defined in Section 22(e)(3) of the Code
or any successor statute.

         In granting any Non-Qualified Option, the Committee may specify that
such Non-Qualified Option shall be subject to the restrictions set forth herein
with respect to ISOs, or to such other termination or cancellation provisions as
the Committee may determine.

         11. Non-Transferability of Options. No Option shall be assignable or
transferable by the optionee except by will or by the laws of descent and
distribution, and during the lifetime of the optionee shall be exercisable only
by him.

         12. Terms and Conditions of Options. Options shall be evidenced by
instruments (which need not be identical) in such forms as the Committee may
from time to time approve. Such instruments shall conform to the terms and
conditions set forth in paragraph 6 through 11 hereof and may contain such other
provisions as the Committee deems advisable which are not inconsistent with the
Plan, including restrictions applicable to shares of Common Stock issuable upon
exercise of Options. The Committee may from time to time confer authority and
responsibility on one or more of its own members and/or one or more officers of
the Company to execute and deliver such instruments. The proper officers of the
Company are authorized and directed to take any and all action necessary or
advisable from time to time to carry out the terms of such instruments.

         13. Adjustments. Upon the happening of any of the following described
events, an optionee's rights with respect to Options granted to him hereunder
shall be adjusted as hereinafter provided, unless otherwise specifically
provided in the written agreement between the recipient and the Company relating
to such Option.

                  (a) If there is any change in the number of Shares of Common
Stock through the declaration of stock dividends, or through recapitalization
resulting in stock splits, or combinations or exchanges of such shares, the
number of shares of Common Stock available for Options, the number of such
shares covered by outstanding Options and the price per share of such Options
shall be proportionately adjusted by the Committee to reflect any increase or
decrease in the number of issued shares of Common Stock; provided, however, that
any fractional shares resulting from such adjustment shall be eliminated.

                  (b) In the event of the proposed dissolution or liquidation of
the Company, in the event of any corporate separation or division, including,
but not limited to, split-up, split-off or spin-off, or in the event of a merger
or consolidation of the Company with another corporation, the Committee may
provide that the holder of each Option then exercisable shall have the right to
exercise such Option (at its then Option Price) solely for the kind and amount
of shares of stock and other securities, property, cash or any combination
thereof receivable upon such dissolution, liquidation, or corporate separation
or common stock for which such Option might have been exercised immediately
prior to such dissolution, liquidation, or corporate separation or division, or
merger or consolidation by a holder of the number of shares of Common Stock for
which such Option might have been exercised immediately prior to such
dissolution, liquidation or corporate separation or division, or merger or
consolidation; or the Committee may provide, in the alternative, that each
Option granted under the Plan shall terminate as of a date to be fixed by the
Committee; provided, however, that not less than thirty (30) days' written
notice of the date so fixed shall be given to each Optionee, who shall have the
right, during the period of thirty (30) days preceding such termination, to
exercise the Options as to all or any part of the shares of Common Stock covered
thereby, including shares as to which such Options would not otherwise be
exercisable; provided, further, that failure to provide such notice


                                 Exhibit 4.1.4
<PAGE>   5

shall not invalidate or affect the action with respect to which such notice was
required.

                  (c) If while unexercised Options remain outstanding under the
Plan, the stockholders of the Company approve a definitive agreement to merge
or consolidate the Company with or into another corporation, or to sell or
otherwise dispose of all or substantially all of its assets, or adopt a plan of
liquidation (each, a "Disposition Transaction"), then the Committee may (a) make
an appropriate adjustment to the number and class of shares available for
options, and to the amount and kind of shares or other securities or property
(including cash) receivable upon exercise of any outstanding options after the
effective date of such transaction, and the price thereof, or, in lieu of such
adjustment, provide for the cancellation of all options outstanding at our prior
to the effective date of such transaction; (b) provide that exercisability of
all Options shall be accelerated, whether or not otherwise exercisable; or (c)
in its discretion, permit Optionees to surrender outstanding options for
cancellation; provided, however, that if the stockholders approve such
Disposition Transaction within five (5) years of the date of adoption of this
Plan and before the Company is taken public, the Committee shall provide for the
alternative in (b) above. Upon any cancellation of an outstanding Option
pursuant to this Section, the Optionee shall be entitled to receive, in exchange
therefor, a cash payment under any such Option in an amount per share determined
by the Committee in its sole discretion, but not less than the difference
between the per share exercise price of such Option and the Fair Market Value of
a share of the Company Common Stock on such date as the Committee shall
determine.

                  (d) Paragraphs (b) and (c) of this Section 13 shall not apply
to a merger or consolidation in which the Company is the surviving corporation
and shares of Common Stock are not converted into or exchanged for stock,
securities of any other corporation, cash or any other thing of value.
Notwithstanding the preceding sentence, in case of any consolidation or merger
of another corporation into the Company in which the Company is the surviving
corporation and in which there is a reclassification or change (including a
change to the right to receive cash or other property) of the shares of Common
Stock (other than a change in par value, or from par value to no par value, or
as a result of a subdivision or combination, but including any change in such
shares into two or more classes or series of shares), the Committee may provide
that the holder of each Option then exercisable shall have the right to exercise
such Option solely for the kind and amount of shares of stock and other
securities (including those of any new direct or indirect parent of the
Corporation), property, cash, or any combination thereof receivable upon such
reclassification, change, consolidation or merger by the holder of the number of
share of Common Stock for which such Option might have been exercised.

                  (e) In the event of a change in the Common Stock of the
Company as presently constituted which is limited to a change of all of its
authorized shares with par value into the same number of shares with a different
par value or without par value, the shares resulting from any such change shall
be deemed to be the Common Stock within the meaning of the Plan.


                  (f) To the extent that the foregoing adjustments relate to
stock or securities of the Company, such adjustments shall be made by the
Committee, whose determination in that respect shall be final, binding and
conclusive, provided that each Incentive Stock Option granted pursuant to this
Plan shall not be adjusted in a manner that causes such option to fail to
continue to qualify as an Incentive Stock Option within the meaning of IRC
section 442A.

                  (g) Except as hereinabove expressly provided in this
paragraph, the Optionee shall have no rights by reason of any subdivision or
consolidation of shares of stock or any class or the payment of any stock
dividend or any other increase or decrease in the number of shares of stock or
any class or by reason of any dissolution, liquidation, merger, or consolidation
or spin-off of assets or stock of another corporation; and any issue by the
Company of shares of stock of any class shall not affect, and no adjustment by
reason thereof shall be made with respect to the number or price.

         14. Means of Exercising Options. An Option (or any part or installment
thereof) shall be exercised by giving written notice ("Notice") to the Company
at its principal office address. Such Notice shall identify the Option being
exercised and specify the number of shares as to which such Option is being
exercised, accompanied by full payment of the purchase price therefor either (a)
in United States dollars in case or by check, or (b) at the discretion of the
Committee, through delivery of shares of Common Stock having Fair Market Value
equal as of the date of the exercise to the cash exercise price of the Option,
or (c) at the discretion of the Committee, by delivery of the optionee's
personal recourse note bearing interest payable not less than annually at no
less than 100% of the lowest applicable Federal rate, as defined in


                                 Exhibit 4.1.5
<PAGE>   6

1274(d) of the Code or (d) at the discretion of the Committee, by any
combination of (a), (b) and (c) above. If the Committee exercises its discretion
to permit payment of the exercise price of an ISO by means of the methods set
forth in clauses (b) or (c) of the preceding sentence, such discretion shall be
exercised in writing at the time of the grant of the ISO in question. The holder
of an Option shall not have the rights of a shareholder with respect to the
shares covered by his Option until the date of issuance of a stock certificate
to him for such shares. Except as expressly provided above in paragraph 13 with
respect to changes in capitalization and stock dividends, no adjustment shall be
made for dividends or similar rights for which the record date is before the
date such stock certificate is issued.

         15. Term and Amendment of Plan. This Plan was adopted by the Board
effective September 1, 1994, subject to approval of the Plan by the holders of a
majority of the outstanding shares of Common Stock of the Company at the next
Meeting of Stockholders. The Plan shall expire on August 31, 2004 (except as to
Options outstanding on that date). Subject to the provisions of paragraph 5
above, Options may be granted under the Plan prior to the date of stockholder
approval of the Plan. If the approval of Stockholders is not obtained by August
31, 1995, any grants of Options under the Plan made prior to that date will be
rescinded. The Board may terminate or amend the Plan in any respect at any time,
except that, without the approval of such stockholders obtained within twelve
(12) months before or after the Board adopts a resolution authorizing any of the
following actions: (a) the total number of shares that may be issued under the
Plan may not be increased (except by adjustment pursuant to paragraph 13); (b)
the provisions of paragraph 3 regarding eligibility for grants of ISOs may not
be modified; (c) the provisions of paragraph 6(B) regarding the exercise price
at which shares may be offered pursuant to ISOs may not be modified (except by
adjustment pursuant to paragraph 13); and (d) the expiration date of the Plan
may not be extended. Except as provided in the fourth sentence of this paragraph
15, in no event may action of the Board or stockholders alter or impair the
rights of an optionee without his consent, under any Option previously granted
to or made by him.

         16. Conversion of ISOs into Non-Qualified Options; Termination of ISOs.
The Committee, at the written request of any optionee, may, in its discretion,
take such actions as may be necessary to convert such optionee's ISOs (or any
installments or portions of installments thereof) that have not been exercised
on the date of conversion into Non-Qualified Options at any time prior to the
expiration of such ISOs, regardless of whether the optionee is an employee of
the Company, or a Related Corporation, at the time of such conversion. Such
actions may include, but are not limited to, extending the exercise period or
reducing the exercise price of the appropriate installments of such Options. At
the time of such conversion, the Committee (with the consent of the Optionee)
may impose such conditions on the exercise of the resulting Non-Qualified
Options as the Committee in its discretion may determine, provided that such
conditions shall not be inconsistent with this Plan. Nothing in the Plan shall
be deemed to give any optionee the right to have such optionee's ISOs converted
into Non-Qualified Options, and no such conversation shall occur until and
unless the Board take appropriate action. The Committee, with the consent of the
optionee, may also terminate any portion of any ISO that has not been exercised
at the time of such termination.

         17. Application of Funds. The proceeds received by the Company from the
sale of shares pursuant to Options granted under the Plan shall be used for
general corporate purposes.

         18. Governmental Regulation. The Company's obligation to sell and
deliver shares of the Common Stock under this Plan is subject to the approval of
any governmental authority required in connection with the authorization,
issuance or sale of such shares.

         19. Withholding of Additional Income Taxes. Upon the exercise of a
Non-Qualified Option, the making of a Disqualifying Disposition (as defined in
paragraph 20) or the vesting of restricted Common Stock acquired on the exercise
of an Option, the Company, in accordance with Section 3402(a) of the Code, may
require the optionee to pay additional withholding taxes in respect of the
amount that is considered compensation includable in such person's gross income.
The Committee in its discretion may condition (i) the exercise of an Option or
(ii) the vesting of restricted Common Stock acquired by exercising an Option, on
the optionee's payment of such additional withholding taxes.

         20. Notice to Company of Disqualifying Disposition. Each employee who
receives ISOs shall agree to notify the Company in writing immediately after the
employee makes a disqualifying disposition of any Common Stock received pursuant
to the exercise of an ISO (a "Disqualifying Disposition"). Disqualifying
Disposition means any disposition


                                 Exhibit 4.1.6
<PAGE>   7

(including any sale) of such stock before the later of (a) two years after the
employee was granted the ISO under which he acquired such stock, or (b) one year
after the employee acquired such stock is sold, these holding period
requirements do not apply and no Disqualifying Disposition will thereafter
occur.

         21. Governing Laws; Construction. The validity and construction of the
Plan and the instruments evidencing Options, Awards and Purchases shall be
governed by the laws of The State of New York. In construing this Plan, the
singular shall include the plural and the masculine gender shall include the
feminine and neuter, unless the context otherwise requires.


                                 Exhibit 4.1.7