STOCK OPTION AGREEMENT

     This STOCK OPTION  AGREEMENT  is made as of the _______ day of  __________,
1999,  by  and  between  Spectrum  Information  Technologies,  Inc.  a  Delaware
Corporation (the "Company") and Powers & Co. (the "Optionee".

     WHEREAS,  the Company and the Optionee  have entered into a Stock  Purchase
Agreement dated July 26, 1999,  providing for the sale to the Optionee of shares
of common  stock,  par value  $0.001  per share,  of The  Company  (the  "Common
Stock"),  and the stock option described herein for an aggregate  purchase price
of $1,250,000, subject to conditions precedent set forth therein; and

     WHEREAS,  the  conditions  precedent  set  forth  in  such  Stock  Purchase
Agreement have been satisfied;

     NOW,  THEREFORE,  in  consideration  of the payment  described,  the mutual
covenants  hereinafter set forth and for other good and valuable  consideration,
the parties hereto agree as follows:

     1. GRANT OF OPTION. The Company hereby grants to the Optionee the right and
option  (hereafter  called this  "Option"),  to  purchase  all or any part of an
aggregate  of 500,000  shares of Common  Stock on the terms and  conditions  set
forth herein.

     2. EXERCISE  PRICE AND  EXPIRATION.  The exercise  price and the expiration
dates as to the share underlying this Option shall be as follows:

Number of Share               Exercise Price           Expiration Date
---------------               ---------------          ---------------

500,000                       $2.50 per share          ______________, 2004

     3.  DURATION.  This Option shall become  exercisable  upon issuance of this
Agreement  and  shall  remain  exercisable  at  the  stated  price  through  the
expiration date set forth above.  To facilitate  partial  transfer,  exercise or
sale, this Option may be subdivided into options in smaller  denominations  upon
the Optionee's request in writing from time to time.

     4.  LIMITATION  ON  DISPOSITION.  This  Option and  shares of Common  Stock
underlying this Option have not been registered under the Securities Act of 1933
(the "Act") or under applicable state securities laws and, therefore,  cannot be
sold, assigned,  or otherwise  transferred unless subsequently  registered under
the Act and under  applicable  state  securities  laws or an exemption from such
registration  is then  available.  The Optionee  hereby  agrees that it will not
sell,  assign,  or transfer this Option or the shares of Common Stock underlying
this Option unless they are registered  under the Act and under applicable state
securities  laws or an  exemption  from  such  registration  is then  available,
according to a legal opinion reasonably acceptable to the Company.

<PAGE>


     5. MANNER OF EXERCISE OF OPTION.  This Option may be exercised,  subject to
the terms and conditions  contained herein, by delivering  written notice to the
Chief Executive  Officer or Treasurer of the Company at its principal  office no
less than three days in advance of the proposed exercise date. Such notice shall
specify the number of shares of Common  Stock with  respect to which this Option
is being exercised and the effective date of the proposed  exercise and shall be
signed by the Optionee.  The notice shall be accompanied by a certified check or
cash in the amount of the  aggregate  option  exercise  price for such number of
shares.  In no event shall stock be issued or  certificates  be delivered  until
full  payment  shall have been  received by the  Company as to such  exercise or
partial  exercise,  nor  shall  the  Optionee  have  any  right or  status  as a
shareholder of such underlying  shares prior to such exercise.  Certificates for
shares of Common  Stock  purchased  upon the  exercise of this  Option  shall be
delivered to the Optionee as soon as practicable following the effective date on
which this Option is exercised.

     6.  ADJUSTMENT  ON  RECAPITALIZATION,  MERGER  OR  REORGANIZATION.  If  the
outstanding   shares  of  the  Common  Stock  of  the  Company  are  subdivided,
consolidated,  increased,  decreased,  changed into or exchanged for a different
number or kind of shares or  securities of the Company  through  reorganization,
merger, recapitalization,  reclassification, capital adjustment or otherwise, or
if the Company  shall issue  Common  Stock as a dividend or upon a stock  split,
then the number of shares  subject  to the  unexercised  portion of this  Option
shall be  appropriately  adjusted by the Board of Directors of the Company.  Any
such  adjustment  shall be made  without  change  in the  total  exercise  price
applicable  to the  unexercised  portion of this  Option.  If, in the event of a
merger or consolidation,  the Company is not the surviving corporation,  and the
event that the  agreement  of merger or  consolidation  does not provide for the
substitution  of a new option for this  Option,  or for the  assumption  of this
Option  by the  surviving  corporation,  or in the event of the  dissolution  or
liquidation of the Company,  the Optionee shall have the right immediately prior
to the effective date of such merger, consolidation, dissolution or liquidation,
to exercise this Option in whole or in part, provided, however, that this Option
shall  not be  exercisable  in whole  or in part  later  than the date  noted in
paragraph 2 above. Any adjustments made pursuant to this paragraph shall be made
by the Board of  Directors  of the Company,  whose good faith  determination  in
compliance with Delaware law, as to what adjustment shall be made and the extent
thereof,  shall be final,  binding and  conclusive.  In computing any adjustment
hereunder,  any fractional  share which might  otherwise  become subject to this
Option shall be eliminated.


SPECTRUM INFORMATION TECHNOLOGIES, INC


By: ___________________________________________________
    Jon Gerber, Vice-President, Secretary and Treasurer


OPTIONEE

POWERS & CO.


By: ___________________________________________________
    Lawrence M. Powers, Owner


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