Exhibit 10.1

                               PHOENIX COLOR CORP.
                    AMENDED AND RESTATED STOCK INCENTIVE PLAN

1.    Establishment, Purpose and Types of Awards

      PHOENIX COLOR CORP., a Delaware corporation (the "Company"), hereby
establishes the PHOENIX COLOR CORP. AMENDED AND RESTATED STOCK INCENTIVE PLAN
(the "Plan"). The purpose of the Plan is to promote the long-term growth and
profitability of the Company by (i) providing key people with incentives to
improve stockholder value and to contribute to the growth and financial success
of the Company through their future services, and (ii) enabling the Company to
attract, retain and reward the best-available persons. This Plan is a
continuation, and amendment and restatement, of the Company's 2002 Stock
Incentive Plan.

      The Plan permits the granting of nonstatutory stock options, stock
appreciation rights, restricted or unrestricted stock awards, phantom stock,
performance awards, other stock-based awards, or any combination of the
foregoing.

2.    Definitions

      Under this Plan, except where the context otherwise indicates, the
following definitions apply:

            (a) "Administrator" means the Board, or the committee(s) or
      officer(s) appointed by the Board that have authority to administer the
      Plan as provided in Section 3(a) hereof.

            (b) "Affiliate" means any entity, whether now or hereafter existing,
      which controls, is controlled by, or is under common control with, the
      Company (including, but not limited to, joint ventures, limited liability
      companies, and partnerships). For this purpose, "control" shall mean
      ownership of 50% or more of the total combined voting power or value of
      all classes of stock or interests of the entity.

            (c) "Award" means any stock option, stock appreciation right, stock
      award, phantom stock award, performance award, or other stock-based award.

            (d) "Board" means the Board of Directors of the Company.

            (e) "Change of Control" means: (i) the acquisition in one or more
      transactions by any Person, as defined in this Section 2(e), (other than
      from the Company) of the beneficial ownership (within the meaning of Rule
      13d-3 promulgated under the Securities Exchange Act of 1934, as amended)
      of 50% or more of (A) the then outstanding capital stock of the Company,
      or (B) the combined voting power of the then outstanding capital stock of
      the Company entitled to vote generally in the election of directors (the
      "Company Voting Stock"); (ii) the closing of a sale or other conveyance of
      all or substantially all of the assets of the Company; (iii) the effective
      time of any merger, share exchange, consolidation, or other business
      combination involving the Company if immediately after such transaction
      persons who hold a majority of the outstanding voting securities entitled
      to vote generally in the election of directors of the surviving entity (or
      the entity owning 100% of such surviving entity) are not persons who,
      immediately prior to such transaction, held the Company Voting Stock. For
      purposes of this Section 2(e), a "Person" means any individual, entity or
      group within the meaning of Section 13(d)(3) or 14(d)(2) of the Securities
      Exchange Act of 1934, as amended, other than: employee benefit plans
      sponsored or maintained by the Company and entities controlled by the
      Company.

            (f) "Code" means the Internal Revenue Code of 1986, as amended, and
      any regulations promulgated thereunder.

            (g) "Common Stock" means shares of the Class A Common Stock of the
      Company, par value one cent ($0.01) per share.

            (h) "Fair Market Value" means, with respect to a share of the
      Company's Common Stock for any purpose on a particular date, the value
      determined by the Administrator in good faith. However, if the Common
      Stock is registered under Section 12(b) or 12(g) of the Securities
      Exchange Act of 1934,

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      as amended, and listed for trading on a national exchange or market, "Fair
      Market Value" means, as applicable, (i) either the closing price or the
      average of the high and low sale price on the relevant date, as determined
      in the Administrator's discretion, quoted on the New York Stock Exchange,
      the American Stock Exchange, or the Nasdaq National Market; (ii) the last
      sale price on the relevant date quoted on the Nasdaq SmallCap Market;
      (iii) the average of the high bid and low asked prices on the relevant
      date quoted on the Nasdaq OTC Bulletin Board Service or by the National
      Quotation Bureau, Inc. or a comparable service as determined in the
      Administrator's discretion; or (iv) if the Common Stock is not quoted by
      any of the above, the average of the closing bid and asked prices on the
      relevant date furnished by a professional market maker for the Common
      Stock, or by such other source, selected by the Administrator. If no
      public trading of the Common Stock occurs on the relevant date but the
      shares are so listed, then Fair Market Value shall be determined as of the
      next preceding date on which trading of the Common Stock does occur. For
      all purposes under this Plan, the term "relevant date" as used in this
      Section 2(h) means either the date as of which Fair Market Value is to be
      determined or the next preceding date on which public trading of the
      Common Stock occurs, as determined in the Administrator's discretion.

            (i) "Grant Agreement" means a written document memorializing the
      terms and conditions of an Award granted pursuant to the Plan and shall
      incorporate the terms of the Plan.

3.    Administration

            (a) Administration of the Plan. The Plan shall be administered by
      the Board or by such committee or committees as may be appointed by the
      Board from time to time. To the extent allowed by applicable state law,
      the Board by resolution may authorize one or more officers to grant Awards
      (other than stock Awards) to other officers and employees of the Company
      and its Affiliates and, to the extent of such authorization, such officer
      or officers shall be the Administrator.

            (b) Powers of the Administrator. The Administrator shall have all
      the powers vested in it by the terms of the Plan, such powers to include
      authority, in its sole and absolute discretion, to grant Awards under the
      Plan, prescribe Grant Agreements evidencing such Awards and establish
      programs for granting Awards.

            The Administrator shall have full power and authority to take all
      other actions necessary to carry out the purpose and intent of the Plan,
      including, but not limited to, the authority to: (i) determine the
      eligible persons to whom, and the time or times at which Awards shall be
      granted; (ii) determine the types of Awards to be granted; (iii) determine
      the number of shares to be covered by or used for reference purposes for
      each Award; (iv) impose such terms, limitations, restrictions and
      conditions upon any such Award as the Administrator shall deem
      appropriate; (v) modify, amend, extend or renew outstanding Awards, or
      accept the surrender of outstanding Awards and substitute new Awards
      (provided however, that, except as provided in Section 7(c) of the Plan,
      any modification that would materially adversely affect any outstanding
      Award shall not be made without the consent of the holder); (vi)
      accelerate or otherwise change the time in which an Award may be exercised
      or becomes payable and to waive or accelerate the lapse, in whole or in
      part, of any restriction or condition with respect to such Award,
      including, but not limited to, any restriction or condition with respect
      to the vesting or exercisability of an Award following termination of any
      grantee's employment or other relationship with the Company; (vii)
      establish objectives and conditions, if any, for earning Awards and
      determining whether Awards will be paid after the end of a performance
      period; and (viii) for any purpose, including but not limited to,
      qualifying for preferred tax treatment under foreign tax laws or otherwise
      complying with the regulatory requirements of local or foreign
      jurisdictions, to establish, amend, modify, administer or terminate
      sub-plans, and prescribe, amend and rescind rules and regulations relating
      to such sub-plans.

            The Administrator shall have full power and authority, in its sole
      and absolute discretion, to administer and interpret the Plan, Grant
      Agreements and all other documents relevant to the Plan and Awards issued
      thereunder, and to adopt and interpret such rules, regulations,
      agreements, guidelines and instruments for the administration of the Plan
      and for the conduct of its business as the Administrator deems necessary
      or advisable.


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<PAGE>

            (c) Non-Uniform Determinations. The Administrator's determinations
      under the Plan (including without limitation, determinations of the
      persons to receive Awards, the form, amount and timing of such Awards, the
      terms and provisions of such Awards and the Grant Agreements evidencing
      such Awards) need not be uniform and may be made by the Administrator
      selectively among persons who receive, or are eligible to receive, Awards
      under the Plan, whether or not such persons are similarly situated.

            (d) Limited Liability. To the maximum extent permitted by law, no
      member of the Administrator shall be liable for any action taken or
      decision made in good faith relating to the Plan or any Award thereunder.

            (e) Indemnification. To the maximum extent permitted by law and by
      the Company's charter and by-laws, the members of the Administrator shall
      be indemnified by the Company in respect of all their activities under the
      Plan.

            (f) Effect of Administrator's Decision. All actions taken and
      decisions and determinations made by the Administrator on all matters
      relating to the Plan pursuant to the powers vested in it hereunder shall
      be in the Administrator's sole and absolute discretion and shall be
      conclusive and binding on all parties concerned, including the Company,
      its stockholders, any participants in the Plan and any other employee,
      consultant, or director of the Company, and their respective successors in
      interest.

4.    Shares Available for the Plan

      Subject to adjustments as provided in Section 7(c) of the Plan, the shares
of Common Stock that may be issued with respect to Awards granted under the Plan
shall not exceed an aggregate of Two Thousand Eight Hundred Thirty-Five (2,835)
shares of Common Stock. The Company shall reserve such number of shares for
Awards under the Plan, subject to adjustments as provided in Section 7(c) of the
Plan. If any Award, or portion of an Award, under the Plan expires or terminates
unexercised, becomes unexercisable or is forfeited or otherwise terminated,
surrendered or canceled as to any shares, or if any shares of Common Stock are
repurchased by or surrendered to the Company in connection with any Award
(whether or not such surrendered shares were acquired pursuant to any Award), or
if any shares are withheld by the Company, the shares subject to such Award and
the repurchased, surrendered and withheld shares shall thereafter be available
for further Awards under the Plan.

5.    Participation

      Participation in the Plan shall be open to all employees, officers, and
directors of, and other individuals providing bona fide services to or for, the
Company or any Affiliate, as may be selected by the Administrator from time to
time. The Administrator may also grant Awards to individuals in connection with
hiring, retention or otherwise, prior to the date the individual first performs
services for the Company or an Affiliate, provided that such Awards shall not
become vested or exercisable prior to the date the individual first commences
performance of such services.

6.    Awards

      The Administrator, in its sole discretion, shall establish the terms of
all Awards granted under the Plan. Awards may be granted individually or in
tandem with other types of Awards. All Awards are subject to the terms and
conditions provided in the Grant Agreement. The Administrator may permit or
require a recipient of an Award to defer such individual's receipt of the
payment of cash or the delivery of Common Stock that would otherwise be due to
such individual by virtue of the exercise of, payment of, or lapse or waiver of
restrictions respecting, any Award. If any such payment deferral is required or
permitted, the Administrator shall, in its sole discretion, establish rules and
procedures for such payment deferrals.

            (a) Stock Options. The Administrator may from time to time grant to
      eligible participants Awards of nonstatutory stock options that are not
      intended to be "incentive stock options" as that term is defined in Code
      section 422. Such options may have an exercise price below, equalt to, or
      greater than Fair Market Value as of the date of grant, as determined in
      the discretion of the Administrator.


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<PAGE>

            (b) Stock Appreciation Rights. The Administrator may from time to
      time grant to eligible participants Awards of Stock Appreciation Rights
      ("SAR"). An SAR entitles the grantee to receive, subject to the provisions
      of the Plan and the Grant Agreement, a payment having an aggregate value
      equal to the product of (i) the excess of (A) the Fair Market Value on the
      exercise date of one share of Common Stock over (B) the base price per
      share specified in the Grant Agreement, times (ii) the number of shares
      specified by the SAR, or portion thereof, which is exercised. Payment by
      the Company of the amount receivable upon any exercise of an SAR may be
      made by the delivery of Common Stock or cash, or any combination of Common
      Stock and cash, as determined in the sole discretion of the Administrator.
      If upon settlement of the exercise of an SAR a grantee is to receive a
      portion of such payment in shares of Common Stock, the number of shares
      shall be determined by dividing such portion by the Fair Market Value of a
      share of Common Stock on the exercise date. No fractional shares shall be
      used for such payment and the Administrator shall determine whether cash
      shall be given in lieu of such fractional shares or whether such
      fractional shares shall be eliminated.

            (c) Stock Awards. The Administrator may from time to time grant
      restricted or unrestricted stock Awards to eligible participants in such
      amounts, on such terms and conditions, and for such consideration,
      including no consideration or such minimum consideration as may be
      required by law, as it shall determine. A stock Award may be paid in
      Common Stock, in cash, or in a combination of Common Stock and cash, as
      determined in the sole discretion of the Administrator.

            (d) Phantom Stock. The Administrator may from time to time grant
      Awards to eligible participants denominated in stock-equivalent units
      ("phantom stock") in such amounts and on such terms and conditions as it
      shall determine. Phantom stock units granted to a participant shall be
      credited to a bookkeeping reserve account solely for accounting purposes
      and shall not require a segregation of any of the Company's assets. An
      Award of phantom stock may be settled in Common Stock, in cash, or in a
      combination of Common Stock and cash, as determined in the sole discretion
      of the Administrator. Except as otherwise provided in the applicable Grant
      Agreement, the grantee shall not have the rights of a stockholder with
      respect to any shares of Common Stock represented by a phantom stock unit
      solely as a result of the grant of a phantom stock unit to the grantee.

            (e) Performance Awards. The Administrator may, in its discretion,
      grant performance awards which become payable on account of attainment of
      one or more performance goals established by the Administrator.
      Performance awards may be paid by the delivery of Common Stock or cash, or
      any combination of Common Stock and cash, as determined in the sole
      discretion of the Administrator. Performance goals established by the
      Administrator may be based on the Company's or an Affiliate's operating
      income or one or more other business criteria selected by the
      Administrator that apply to an individual or group of individuals, a
      business unit, or the Company or an Affiliate as a whole, over such
      performance period as the Administrator may designate.

            (f) Other Stock-Based Awards. The Administrator may from time to
      time grant other stock-based awards to eligible participants in such
      amounts, on such terms and conditions, and for such consideration,
      including no consideration or such minimum consideration as may be
      required by law, as it shall determine. Other stock-based awards may be
      denominated in cash, in Common Stock or other securities, in
      stock-equivalent units, in stock appreciation units, in securities or
      debentures convertible into Common Stock, or in any combination of the
      foregoing and may be paid in Common Stock or other securities, in cash, or
      in a combination of Common Stock or other securities and cash, all as
      determined in the sole discretion of the Administrator.

7.    Miscellaneous

            (a) Withholding of Taxes. Grantees and holders of Awards shall pay
      to the Company or its Affiliate, or make provision satisfactory to the
      Administrator for payment of, any taxes required to be withheld in respect
      of Awards under the Plan no later than the date of the event creating the
      tax liability. The Company or its Affiliate may, to the extent permitted
      by law, deduct any such tax obligations from any payment of any kind
      otherwise due to the grantee or holder of an Award. In the event that
      payment to the Company or its Affiliate of such tax obligations is made in
      shares of Common Stock, such shares


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<PAGE>

      shall be valued at Fair Market Value on the applicable date for such
      purposes and shall not exceed in amount the minimum statutory tax
      withholding obligation.

            (b) Transferability. Except as otherwise determined by the
      Administrator, no Award granted under the Plan shall be transferable by a
      grantee otherwise than by will or the laws of descent and distribution.
      Unless otherwise determined by the Administrator in accord with the
      provisions of the immediately preceding sentence, an Award may be
      exercised during the lifetime of the grantee, only by the grantee or,
      during the period the grantee is under a legal disability, by the
      grantee's guardian or legal representative.

            (c) Adjustments for Corporate Transactions and Other Events.

                  (i)   Stock Dividend, Stock Split and Reverse Stock Split. In
                        the event of a stock dividend of, or stock split or
                        reverse stock split affecting, the Common Stock, (A) the
                        maximum number of shares of such Common Stock as to
                        which Awards may be granted under this Plan, as provided
                        in Section 4 of the Plan, and (B) the number of shares
                        covered by and the exercise price and other terms of
                        outstanding Awards, shall, without further action of the
                        Board, be adjusted to reflect such event unless the
                        Board determines, at the time it approves such stock
                        dividend, stock split or reverse stock split, that no
                        such adjustment shall be made. The Administrator may
                        make adjustments, in its discretion, to address the
                        treatment of fractional shares and fractional cents that
                        arise with respect to outstanding Awards as a result of
                        the stock dividend, stock split or reverse stock split.

                  (ii)  Non-Change of Control Transactions. Except with respect
                        to the transactions set forth in Section 7(c)(i), in the
                        event of any change affecting the Common Stock, the
                        Company or its capitalization, by reason of a spin-off,
                        split-up, dividend, recapitalization, merger,
                        consolidation or share exchange, other than any such
                        change that is part of a transaction resulting in a
                        Change of Control of the Company, the Administrator, in
                        its discretion and without the consent of the holders of
                        the Awards, may make (A) appropriate adjustments to the
                        maximum number and kind of shares reserved for issuance
                        or with respect to which Awards may be granted under the
                        Plan, as provided in Section 4 of the Plan; and (B) any
                        adjustments in outstanding Awards, including but not
                        limited to modifying the number, kind and price of
                        securities subject to Awards.

                  (iii) Change of Control Transactions. In the event of any
                        transaction resulting in a Change of Control of the
                        Company, outstanding stock options and other Awards that
                        are payable in or convertible into Common Stock under
                        this Plan will terminate upon the effective time of such
                        Change of Control unless provision is made in connection
                        with the transaction for the continuation or assumption
                        of such Awards by, or for the substitution of the
                        equivalent awards of, the surviving or successor entity
                        or a parent thereof. In the event of such termination,
                        (A) the outstanding stock options and other Awards that
                        will terminate upon the effective time of the Change of
                        Control shall become fully vested immediately before the
                        effective time of the Change of Control, and (B) the
                        holders of stock options and other Awards under the Plan
                        will be permitted, immediately before the Change of
                        Control, to exercise or convert all portions of such
                        stock options or other Awards under the Plan that are
                        then exercisable or convertible or which become
                        exercisable or convertible upon or prior to the
                        effective time of the Change of Control.

                  (iv)  Unusual or Nonrecurring Events. The Administrator is
                        authorized to make, in its discretion and without the
                        consent of holders of Awards, adjustments in the terms
                        and conditions of, and the criteria included in, Awards
                        in recognition of unusual or nonrecurring events
                        affecting the Company, or the financial statements of
                        the Company or any Affiliate, or of changes in
                        applicable laws,


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<PAGE>

                        regulations, or accounting principles, whenever the
                        Administrator determines that such adjustments are
                        appropriate in order to prevent dilution or enlargement
                        of the benefits or potential benefits intended to be
                        made available under the Plan.

            (d) Substitution of Awards in Mergers and Acquisitions. Awards may
      be granted under the Plan from time to time in substitution for awards
      held by employees, officers, consultants or directors of entities who
      become or are about to become employees, officers, consultants or
      directors of the Company or an Affiliate as the result of a merger or
      consolidation of the employing entity with the Company or an Affiliate, or
      the acquisition by the Company or an Affiliate of the assets or stock of
      the employing entity. The terms and conditions of any substitute Awards so
      granted may vary from the terms and conditions set forth herein to the
      extent that the Administrator deems appropriate at the time of grant to
      conform the substitute Awards to the provisions of the awards for which
      they are substituted.

            (e) Other Agreements. As a condition precedent to the grant of any
      Award under the Plan, the exercise pursuant to such an Award, or to the
      delivery of certificates for shares issued pursuant to any Award, the
      Administrator may require the grantee or the grantee's successor or
      permitted transferee, as the case may be, to become a party to a stock
      restriction agreement, shareholders' agreement, voting trust agreement or
      other agreements regarding the Common Stock of the Company in such form(s)
      as the Administrator may determine from time to time.

            (f) Termination, Amendment and Modification of the Plan. The Board
      may terminate, amend or modify the Plan or any portion thereof at any
      time.

            (g) Non-Guarantee of Employment or Service. Nothing in the Plan or
      in any Grant Agreement thereunder shall confer any right on an individual
      to continue in the service of the Company or shall interfere in any way
      with the right of the Company to terminate such service at any time with
      or without cause or notice and whether or not such termination results in
      (i) the failure of any Award to vest; (ii) the forfeiture of any unvested
      or vested portion of any Award; and/or (iii) any other adverse effect on
      the individual's interests under the Plan.

            (h) Compliance with Securities Laws; Listing and Registration.

                  (i)   If at any time the Administrator determines that the
                        delivery of Common Stock under the Plan is or may be
                        unlawful under the laws of any applicable jurisdiction,
                        or federal, state or foreign securities laws, the right
                        to exercise an Award or receive shares of Common Stock
                        pursuant to an Award shall be suspended until the
                        Administrator determines that such delivery is lawful.
                        The Company shall have no obligation to effect any
                        registration or qualification of the Common Stock under
                        federal, state or foreign laws.

                  (ii)  The Company may require that a grantee, as a condition
                        to exercise of an Award, and as a condition to the
                        delivery of any share certificate, make such written
                        representations (including representations to the effect
                        that such person will not dispose of the Common Stock so
                        acquired in violation of federal, state or foreign
                        securities laws) and furnish such information as may, in
                        the opinion of counsel for the Company, be appropriate
                        to permit the Company to issue the Common Stock in
                        compliance with applicable federal, state or foreign
                        securities laws. The stock certificates for any shares
                        of Common Stock issued pursuant to this Plan may bear a
                        legend restricting transferability of the shares of
                        Common Stock unless such shares are registered or an
                        exemption from registration is available under the
                        Securities Act of 1933, as amended, and applicable state
                        or foreign securities laws.

            (i) No Trust or Fund Created. Neither the Plan nor any Award shall
      create or be construed to create a trust or separate fund of any kind or a
      fiduciary relationship between the Company and a grantee or any other
      person. To the extent that any grantee or other person acquires a right to
      receive


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<PAGE>

      payments from the Company pursuant to an Award, such right shall be no
      greater than the right of any unsecured general creditor of the Company.

            (j) Governing Law. The validity, construction and effect of the
      Plan, of Grant Agreements entered into pursuant to the Plan, and of any
      rules, regulations, determinations or decisions made by the Administrator
      relating to the Plan or such Grant Agreements, and the rights of any and
      all persons having or claiming to have any interest therein or thereunder,
      shall be determined exclusively in accordance with applicable federal laws
      and the laws of the State of Delaware without regard to its conflict of
      laws principles.

            (k) Effective Date; Termination Date. The Plan, as amended and
      restated herein, is effective as of the date on which the Plan, as so
      amended and restated, is adopted by the Board (the "Effective Date"). The
      Plan shall continue in effect until all shares reserved for issuance
      hereunder have been issued or until any earlier termination by the Board.
      Subject to other applicable provisions of the Plan, all Awards made under
      the Plan prior to such termination of the Plan shall remain in effect
      until such Awards have been satisfied or terminated in accordance with the
      Plan and the terms of such Awards.


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                                   APPENDIX A
                       PROVISIONS FOR CALIFORNIA RESIDENTS

      With respect to Awards granted to California residents prior to a public
offering of capital stock of the Company that is effected pursuant to a
registration statement filed with, and declared effective by, the Securities and
Exchange Commission under the Securities Act of 1933, as amended, and only to
the extent required by applicable law, the following provisions shall apply
notwithstanding anything in the Plan or a Grant Agreement to the contrary:

1. Stock appreciation rights Awards under Section 6(b) of the Plan or phantom
stock Awards under Section 6(d) of the Plan, which may be settled in shares of
Common Stock, shall not be issued to California residents.

2. With respect to any Award granted in the form of a stock option pursuant to
Section 6(a) of the Plan:

      (a) The Award shall provide an exercise price which is not less than 85%
      of the Fair Market Value of the underlying security at the time the option
      is granted, except that the price shall be not less than 110% of the Fair
      Market Value in the case of any person who owns securities possessing more
      than 10% of the total combined voting power (as defined in Section 194.5
      of the California Corporations Code) of all classes of securities of the
      issuer or its parent or subsidiaries possessing voting power.

      (b) The exercise period shall be no more than 120 months from the date the
      option is granted.

      (c) The options shall be non-transferable other than by will, by the laws
      of descent and distribution, or, if and to the extent permitted under the
      Grant Agreement, as permitted by Rule 701 of the Securities Act of 1933,
      as amended (17 C.F.R. 230.701).

      (d) The Award recipient shall have the right to exercise at the rate of at
      least 20% per year over 5 years from the date the option is granted,
      subject to reasonable conditions such as continued employment. However, in
      the case of an option granted to officers, directors or consultants of the
      Company or the issuer of the underlying security or any of its affiliates,
      the option may become fully exercisable, subject to reasonable conditions
      such as continued employment, at any time or during any period established
      by the issuer of the option or the issuer of the underlying security or
      any of its affiliates.

      (e) Unless employment is terminated for "cause" as defined by applicable
      law, the terms of the Plan or Grant Agreement, or a contract of
      employment, the right to exercise the option in the event of termination
      of employment, to the extent that the Award recipient is entitled to
      exercise on the date employment terminates, will be as follows:

            (1) At least 6 months from the date of termination if termination
            was caused by death or disability.

            (2) At least 30 days from the date of termination if termination was
            caused by other than death or disability.

3. With respect to an Award, granted pursuant to Section 6(c) of the Plan, that
provides the Award recipient the right to purchase stock:

      (a) The Award shall provide a purchase price which is not less than 85% of
      the Fair Market Value of the security at the time the Award recipient is
      granted the right to purchase securities under the Grant Agreement, or at
      the time the purchase is consummated; or, not less than 100% of the Fair
      Market Value of the security either at the time the Award recipient is
      granted the right to purchase securities under the Grant Agreement, or at
      the time the purchase is consummated, in the case of any person who owns
      securities possessing more than 10% of the total combined voting power (as
      defined in Section 194.5 of the California Corporations Code) of all
      classes of securities of the issuer or its parent or subsidiaries
      possessing voting power.


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<PAGE>

      (b) The Award shall be non-transferable other than by will, by the laws of
      descent and distribution, or, if and to the extent permitted under the
      Grant Agreement, as permitted by Rule 701 of the Securities Act of 1933,
      as amended (17 C.F.R. 230.701).

4. The Plan shall have a termination date of not more than 10 years from the
date the Plan is adopted by the Board or the date the Plan is approved by the
security holders, whichever is earlier.

5. Security holders representing a majority of the Company's outstanding
securities entitled to vote must approve the Plan within 12 months before or
after the date the Plan is adopted. Any option exercised or any securities
purchased before security holder approval is obtained must be rescinded if
security holder approval is not obtained within 12 months before or after the
Plan is adopted. Such securities shall not be counted in determining whether
such approval is obtained.

6. At the discretion of the Administrator, the Company may reserve to itself
and/or its assignee(s) in the Grant Agreement or any applicable stock
restriction agreement a right to repurchase securities held by an Award
recipient upon such Award recipient's termination of employment at any time
within 90 days after such Award recipient's termination date (or in the case of
securities issued upon exercise of an option after the termination date, within
90 days after the date of such exercise) for cash or cancellation of purchase
money indebtedness, at:

      (A) no less than the Fair Market Value of such securities as of the date
      of the Award recipient's termination of employment, provided, that such
      right to repurchase securities terminates when the Company's securities
      have become publicly traded; or

      (B) the Award recipient's original purchase price, provided, that such
      right to repurchase securities at the original purchase price lapses at
      the rate of at least 20% of the securities per year over 5 years from the
      date the option is granted (without respect to the date the option was
      exercised or became exercisable).

      The securities held by an officer, director or consultant of the Company
or an affiliate may be subject to additional or greater restrictions.

7. The Company will provide financial statements to each Award recipient
annually during the period such individual has Awards outstanding, or as
otherwise required under Section 260.140.46 of Title 10 of the California Code
of Regulations. Notwithstanding the foregoing, the Company will not be required
to provide such financial statements to Award recipients when issuance is
limited to key employees whose services in connection with the Company assure
them access to equivalent information.

8. The Company will comply with Section 260.140.1 of Title 10 of the California
Code of Regulations with respect to the voting rights of Common Stock and
similar equity securities.

9. The Plan is intended to comply with Section 25102(o) of the California
Corporations Code. Any provision of this Plan which is inconsistent with Section
25102(o), including without limitation any provision of this Plan that is more
restrictive than would be permitted by Section 25102(o) as amended from time to
time, shall, without further act or amendment by the Board, be reformed to
comply with the provisions of Section 25102(o). If at any time the Administrator
determines that the delivery of Common Stock under the Plan is or may be
unlawful under the laws of any applicable jurisdiction, or federal or state
securities laws, the right to exercise an Award or receive shares of Common
Stock pursuant to an Award shall be suspended until the Administrator determines
that such delivery is lawful. The Company shall have no obligation to effect any
registration or qualification of the Common Stock under federal or state laws.


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