<PAGE>

                                                            Exhibit 4.2
                                                            -----------

                                 NFRONT, INC.

                          DIRECTOR STOCK OPTION PLAN

1.   Purposes of the Plan. The purposes of this Director Stock Option Plan are
     to attract and retain the best available personnel for service as Outside
     Directors (as defined herein) of the Company, to provide additional
     incentive to the Outside Directors of the Company to serve as Directors,
     and to encourage their continued service on the Board.

     All options granted hereunder shall be nonstatutory stock options.

2.   Definitions.  As used herein, the following definitions shall apply:

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

     (b)  "Code" means the Internal Revenue Code of 1986, as amended.

     (c)  "Common Stock" means the Common Stock of the Company.

     (d)  "Company" means nFront, Inc., a Georgia corporation.

     (e)  "Director" means a member of the Board.

     (f)  "Employee" means any person, including officers and Directors,
          employed by the Company or any Parent or Subsidiary of the Company.
          The payment of a Director's fee by the Company shall not be sufficient
          in and of itself to constitute "employment" by the Company.

     (g)  "Exchange Act" means the Securities Exchange Act of 1934, as amended.

     (h)  "Fair Market Value" means, as of any date, the value of Common Stock
          determined as follows:

          (i)  If the Common Stock is listed on any established stock exchange
               or a national market system, including without limitation the
               Nasdaq National Market or The Nasdaq SmallCap Market of The
               Nasdaq Stock Market, its Fair Market Value shall be the closing
               sales price for such stock (or the closing bid, if no sales were
               reported) as quoted on such exchange or system for the last
               market trading day prior to the time of determination, as
               reported in The Wall Street Journal or such other source as the
               Board deems reliable;

          (ii) If the Common Stock is regularly quoted by a recognized
               securities dealer but selling prices are not reported, the Fair
               Market Value of a Share of Common Stock shall be the mean between
               the high bid and low asked prices for the Common Stock on the
               date of determination, as reported in The Wall Street Journal or
               such other source as the Board deems reliable, or;
<PAGE>

          (iii)  In the absence of an established market for the Common Stock,
                 the Fair Market Value thereof shall be determined in good faith
                 by the Board.

     (i)  "Inside Director" means a Director who is an Employee.

     (j)  "Option" means a stock option granted pursuant to the Plan.

     (k)  "Optioned Stock" means the Common Stock subject to an Option.

     (l)  "Optionee" means a Director who holds an option.

     (m)  "Outside Director" means a Director who is not an Employee.

     (n)  "Parent" means a "parent corporation," whether now or hereafter
          existing, as defined in Section 424(e) of the Code.

     (o)  "Plan" means this Director Stock Option Plan.

     (p)  "Share" means a share of the Common Stock, as adjusted in accordance
          with Section 10 of the Plan.

     (q)  "Subsidiary" means a "subsidiary corporation," whether now or
          hereafter existing, as defined in Section 424(f) of the Code.

3.   Stock Subject to the Plan. Subject to the provisions of Section 10 of the
     Plan, the maximum aggregate number of Shares which may be optioned and sold
     under the Plan is Two Hundred Thousand (200,000) Shares of Common Stock
     (the "Pool"). The Shares may be authorized but unissued, or reacquired
     Common Stock.

     If an Option expires or becomes unexercisable without having been exercised
     in full, the unpurchased Shares which were subject thereto shall become
     available for future grant or sale under the Plan (unless the Plan has
     terminated). Shares that have actually been issued under the Plan shall not
     be returned to the Plan and shall not become available for future
     distribution under the Plan.

4.   Administration and Grants of Options under the Plan.

     (a)  Procedure for Grants.  No person shall have any discretion to select
          --------------------
          which Outside Directors shall be granted Options or to determine the
          number of Shares to be covered by Options granted to Outside
          Directors. Automatic grants hereunder shall be made in accordance with
          the following provisions:

          (i)    Each Outside Director (other than an Outside Director serving
                 on the Board on the effective date of this Plan, as determined
                 in accordance with Section 6 hereof) shall be automatically
                 granted an Option to purchase Two Thousand Five Hundred (2,500)
                 Shares (the "First Option") on the date on which such person
                 first becomes an Outside Director, whether through election by
                 the shareholders of the Company or appointment by the Board to
                 fill a vacancy; provided, however, that an Inside Director who
                 ceases to be an Inside Director but who remains a Director
                 shall not receive a First Option.

                                       2
<PAGE>

          (ii)   Each Outside Director shall be automatically granted an Option
                 to purchase One Thousand (1,000) Shares (a "Subsequent Option")
                 on (A) the date such person is elected or reelected, as the
                 case may be, to the Board by the shareholders at the Company's
                 annual meeting of shareholders or otherwise, if on such date,
                 he or she shall have served on the Board for at least six (6)
                 months or (B) in the case of an Outside Director serving a
                 multi-year term, the date of each such annual meeting during
                 his term (other than the meeting at which he or she is elected
                 and the meeting at which his or her term ends), if on such date
                 he or she shall have served on the Board for at least six (6)
                 months.

          (iii)  Notwithstanding the provisions of subsections (ii) and (iii)
                 hereof, any exercise of an Option granted before the Company
                 has obtained shareholder approval of the Plan in accordance
                 with Section 16 hereof shall be conditioned upon obtaining such
                 shareholder approval of the Plan in accordance with Section 16
                 hereof.

          (iv)   The terms of an Option granted hereunder shall be as follows:

                 (A)  the term of the Option shall be ten (10) years.

                 (B)  the Option shall be exercisable only while the Outside
                      Director remains a Director of the Company, except as set
                      forth in Sections 8 and 10 hereof.

                 (C)  the exercise price per Share shall be equal to the Fair
                      Market Value per Share on the date of grant of the Option.
                      In the event that the date of grant of the Option is not a
                      trading day, the exercise price per Share shall be the
                      Fair Market Value on the next trading day immediately
                      following the date of grant of the Option.

          (v)    In the event that any Option granted under the Plan would cause
                 the number of Shares subject to outstanding Options plus the
                 number of Shares previously purchased under Options to exceed
                 the Pool, then the remaining Shares available for Option grant
                 shall be granted under Options to the Outside Directors on a
                 pro rata basis. No further grants shall be made until such
                 time, if any, as additional Shares become available for grant
                 under the Plan through action of the Board or the shareholders
                 to increase the number of Shares which may be issued under the
                 Plan or through cancellation or expiration of Options
                 previously granted hereunder.

5.   Eligibility. Options may be granted only to Outside Directors. All Options
     shall be automatically granted in accordance with the terms set forth in
     Section 4 hereof.

     The Plan shall not confer upon any Optionee any right with respect to
     continuation of service as a Director or nomination to serve as a Director,
     nor shall it interfere in any way with any rights which the Director or the
     Company may have to terminate the Director's relationship with the Company
     at any time.

6.   Term of Plan. The Plan shall become effective upon the earlier to occur of
     its adoption by the Board or its approval by the shareholders of the
     Company as described in Section 16 of the Plan. It shall continue in effect
     for a term of ten (10) years unless sooner terminated under Section 11 of
     the Plan.

                                       3
<PAGE>

7.   Form of Consideration. The consideration to be paid for the Shares to be
     issued upon exercise of an Option, including the method of payment, shall
     consist of (i) cash, (ii) check, (iii) other shares which (x) in the case
     of Shares acquired upon exercise of an option, have been owned by the
     Optionee for more than six (6) months on the date of surrender, and (y)
     have a Fair Market Value on the date of surrender equal to the aggregate
     exercise price of the Shares as to which said Option shall be exercised,
     (iv) delivery of a properly executed exercise notice together with such
     other documentation as the Company and the broker, if applicable, shall
     require to effect an exercise of the Option and delivery to the Company of
     the sale or loan proceeds required to pay the exercise price, or (v) any
     combination of the foregoing methods of payment.

8.   Exercise of Option.

     (a)  Procedure for Exercise; Rights as a Shareholder.  Any Option granted
          -----------------------------------------------
          hereunder shall be exercisable at such times as are set forth in
          Section 4 hereof; provided, however, that no Options shall be
          exercisable until shareholder approval of the Plan in accordance with
          Section 16 hereof has been obtained.

          An Option may not be exercised for a fraction of a Share.

          An Option shall be deemed to be exercised when written notice of such
          exercise has been given to the Company in accordance with the terms of
          the Option by the person entitled to exercise the Option and full
          payment for the Shares with respect to which the Option is exercised
          has been received by the Company. Full payment may consist of any
          consideration and method of payment allowable under Section 7 of the
          Plan. Until the issuance (as evidenced by the appropriate entry on the
          books of the Company or of a duly authorized transfer agent of the
          Company) of the stock certificate evidencing such Shares, no right to
          vote or receive dividends or any other rights as a shareholder shall
          exist with respect to the Optioned Stock, notwithstanding the exercise
          of the Option. A share certificate for the number of Shares so
          acquired shall be issued to the Optionee as soon as practicable after
          exercise of the Option. No adjustment shall be made for a dividend or
          other right for which the record date is prior to the date the stock
          certificate is issued, except as provided in Section 10 of the Plan.

          Exercise of an Option in any manner shall result in a decrease in the
          number of Shares which thereafter may be available, both for purposes
          of the Plan and for sale under the Option, by the number of Shares as
          to which the Option is exercised.

     (b)  Termination of Continuous Status as a Director.  Subject to Section 10
          ----------------------------------------------
          hereof, in the event an Optionee's status as a Director terminates
          (other than upon the Optionee's death or total and permanent
          disability (as defined in Section 22(e)(3) of the Code)), the Optionee
          may exercise his or her Option, but only within three (3) months
          following the date of such termination, and only to the extent that
          the Optionee was entitled to exercise it on the date of such
          termination (but in no event later than the expiration of its ten (10)
          year term). To the extent that the Optionee was not entitled to
          exercise an Option on the date of such termination, and to the extent
          that the Optionee does not exercise such Option (to the extent
          otherwise so entitled) within the time specified herein, the Option
          shall terminate.

     (c)  Disability of Optionee.  In the event Optionee's status as a Director
          ----------------------
          terminates as a result of total and permanent disability (as defined
          in Section 22(e)(3) of the Code), the Optionee may exercise his or her
          Option, but only within twelve (12) months following the date of such

                                       4
<PAGE>

          termination, and only to the extent that the Optionee was entitled to
          exercise it on the date of such termination (but in no event later
          than the expiration of its ten (10) year term). To the extent that the
          Optionee was not entitled to exercise an Option on the date of
          termination, or if he or she does not exercise such Option (to the
          extent otherwise so entitled) within the time specified herein, the
          Option shall terminate.

     (d)  Death of Optionee.  In the event of an Optionee's death, the
          -----------------
          Optionee's estate or a person who acquired the right to exercise the
          Option by bequest or inheritance may exercise the Option, but only
          within twelve (12) months following the date of death, and only to the
          extent that the Optionee was entitled to exercise it on the date of
          death (but in no event later than the expiration of its ten (10) year
          term). To the extent that the Optionee was not entitled to exercise an
          Option on the date of death, and to the extent that the Optionee's
          estate or a person who acquired the right to exercise such Option does
          not exercise such Option (to the extent otherwise so entitled) within
          the time specified herein, the Option shall terminate.

9.   Non-Transferability of Options. The Option may not, without the prior
     written consent of the non-interested members of the Board, be sold,
     pledged, assigned, hypothecated, transferred, or disposed of in any manner
     other than by will or by the laws of descent or distribution and may be
     exercised, during the lifetime of the Optionee, only by the Optionee (or
     its assignee permitted under the preceding clause).

10.  Adjustments Upon Changes in Capitalization, Dissolution, Merger or Asset
     Sale.

     (a)  Changes in Capitalization.  Subject to any required action by the
          -------------------------
          shareholders of the Company, the number of Shares covered by each
          Outstanding Option, the number of Shares which have been authorized
          for issuance under the Plan but as to which no Options have yet been
          granted or which have been returned to the Plan upon cancellation or
          expiration of an Option, as well as the exercise price per Share
          covered by each such outstanding Option, and the number of Shares
          issuable pursuant to the automatic grant provisions of Section 4
          hereof shall be proportionately adjusted for any increase or decrease
          in the number of issued Shares resulting from a stock split, reverse
          stock split, stock dividend, combination or reclassification of the
          Common Stock. Except as expressly provided herein, no issuance by the
          Company of shares of stock of any class, or securities convertible
          into shares of stock of any class, shall affect, and no adjustment by
          reason thereof shall be made with respect to, the number or price of
          Shares subject to an Option.

     (b)  Dissolution or Liquidation.  In the event of the proposed dissolution
          --------------------------
          or liquidation of the Company, to the extent that an Option has not
          been previously exercised, it shall terminate immediately prior to the
          consummation of such proposed action.

     (c)  Merger or Asset Sale.  In the event of a merger of the Company with
          --------------------
          or into another corporation or the sale of substantially all of the
          assets of the Company, outstanding Options may be assumed or
          equivalent options may be substituted by the successor corporation or
          a Parent or Subsidiary thereof (the "Successor Corporation"). If an
          Option is assumed or substituted for, the Option or equivalent option
          shall continue to be exercisable as provided in Section 4 hereof for
          so long as the Optionee serves as a Director or a director of the
          Successor Corporation.

          If the Successor Corporation does not assume an outstanding Option or
          substitute for it-an equivalent option, then the Board shall notify
          the Optionee that the Option shall be fully

                                       5
<PAGE>

          exercisable for a period of thirty (30) days from the date of such
          notice, and upon the expiration of such period the Option shall
          terminate.

          For the purposes of this Section 10(c), an Option shall be considered
          assumed if, following the merger or sale of assets, the Option confers
          the right to purchase or receive, for each Share of Optioned Stock
          subject to the Option immediately prior to the merger or sale of
          assets, the consideration (whether stock, cash, or other securities or
          property) received in the merger or sale of assets by holders of
          Common Stock for each Share held on the effective date of the
          transaction (and if holders were offered a choice of consideration,
          the type of consideration chosen by the holders of a majority of the
          outstanding Shares). If such consideration received in the merger or
          sale of assets is not solely common stock of the successor corporation
          or its Parent, the Board may, with the consent of the successor
          corporation, provide for the consideration to be received upon the
          exercise of the Option, for each Share of Optioned Stock subject to
          the Option, to be solely common stock of the successor corporation or
          its Parent equal in fair market value to the per share consideration
          received by holders of Common Stock in the merger or sale of assets.

11.  Amendment and Termination of the Plan.

     (a)  Amendment and Termination.  The Board may at any time amend, alter,
          -------------------------
          suspend, or discontinue the Plan, but no amendment, alteration,
          suspension, or discontinuation shall be made which would impair the
          rights of any Optionee under any grant theretofore made, without his
          or her consent. In addition, to the extent necessary and desirable to
          comply with any applicable law, regulation or stock exchange rule, the
          Company shall obtain shareholder approval of any Plan amendment in
          such a manner and to such a degree as required.

     (b)  Effect of Amendment or Termination.  Any such amendment or termination
          ----------------------------------
          of the Plan shall not affect Options already granted and such Options
          shall remain in full force and effect as if this Plan had not been
          amended or terminated.

12.  Time of Granting Options. The date of grant of an Option shall, for all
     purposes, be the date determined in accordance with Section 4 hereof.

13.  Conditions Upon Issuance of Shares. Shares shall not be issued pursuant to
     the exercise of an Option unless the exercise of such Option and the
     issuance and delivery of such Shares pursuant thereto shall comply with all
     relevant provisions of law, including, without limitation, the Securities
     Act of 1933, as amended, the Exchange Act, the rules and regulations
     promulgated thereunder, state securities laws, and the requirements of any
     stock exchange upon which the Shares may then be listed, and shall be
     further subject to the approval of counsel for the Company with respect to
     such compliance.

     As a condition to the exercise of an Option, the Company may require the
     person exercising such Option to represent and warrant at the time of any
     such exercise that the Shares are being purchased only for investment and
     without any present intention to sell or distribute such Shares, if, in the
     opinion of counsel for the Company, such a representation is required by
     any of the aforementioned relevant provisions of law.

     Inability of the Company to obtain authority from any regulatory body
     having jurisdiction, which authority is deemed by the Company's counsel to
     be necessary to the lawful issuance and sale of any

                                       6
<PAGE>

     Shares hereunder shall relieve the Company of any liability in respect of
     the failure to issue or sell such Shares as to which such requisite
     authority shall not have been obtained.

14.  Reservation of Shares. The Company, during the term of this Plan, will at
     all times reserve and keep available such number of Shares as shall be
     sufficient to satisfy the requirements of the Plan.

15.  Option Agreement.  Options shall be evidenced by written option agreements
     in such form as the Board shall approve.

16.  Shareholder Approval. Continuance of the Plan shall be subject to approval
     by the shareholders of the Company at or prior to the first annual meeting
     of shareholders held subsequent to the granting of an Option hereunder.
     Such shareholder approval shall be obtained in the degree and manner
     required under applicable state and federal law and any stock exchange
     rules.

17.  Governing Law.  This Plan shall be construed under the laws of the State of
     Georgia.

                                       7