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                                   ECOGEN INC.
                             1998 STOCK OPTION PLAN
                                 (NON-STATUTORY)

1.  Purpose.

                  The purpose of this plan (the "Plan") is to secure for ECOGEN
INC. (the "Company") and its stockholders the benefits arising from capital
stock ownership by employees of the Company (and its parent and subsidiary
corporations) who are expected to contribute to the Company's future growth and
success.

2.  Authorization and Administration.

          (a) Authorization. Options granted pursuant to the Plan shall be
authorized by action of the Board of Directors of the Company (or a Committee,
as defined in Section 2(b) below, designated by the Board of Directors).

         (b) Administration. Except as provided in Section 2(c) below, the Plan
will be administered by the Board of Directors of the Company, whose
construction and interpretation of the terms and provisions of the Plan shall be
final and conclusive. The Board of Directors may in its sole discretion grant
options to purchase shares of the Company's Common Stock, par value .01 per
share ("Common Stock") and authorize the Company to issue shares upon exercise
of such options as provided in the Plan. The Board of Directors shall have
authority, subject to the express provisions of the Plan, to construe the
respective option agreements and the Plan, to prescribe, amend and rescind rules
and regulations relating to the Plan, to determine the terms and provisions of
the respective option agreements, which need not be identical, to advance the
lapse of any waiting or installment periods and exercise dates, and to make all
other determinations in the judgment of the Board of Directors necessary or
desirable for the administration of the Plan. The Board of Directors may correct
any defect or supply any omission or reconcile any inconsistency in the Plan or
in any option agreement in the manner and to the extent it shall deem expedient
to carry the Plan into effect and it shall be the sole and final judge of such
expediency. No director shall be liable for any action or determination taken or
made under or with respect to the Plan or any option in good faith. The Board of
Directors may, to the full extent permitted by law, delegate any or all of its
powers under the Plan to a committee (the "Committee") of two or more directors
each of whom is a Non-Employee Director (as hereinafter defined) appointed by
the Board of Directors, and if the Committee is so appointed all references to
the Board of Directors in the Plan as may pertain to the powers so delegated
shall mean and relate to the Committee. For the purposes of the Plan, a director
or member of such Committee shall be deemed to be a "Non-Employee Director" only
if such person qualifies as a "Non-Employee Director" within the meaning of
paragraph (b)(3) of Rule 16b-3 promulgated under the Securities Exchange Act of
1934, as amended (or any successor rule).

         (c) Non-Officer Employee Administration. Notwithstanding paragraph (b)
of this Section 2, the Chief Executive Officer ("CEO") may, in his sole
discretion, grant options to purchase
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shares of Common Stock under the Plan to non-officer employees. The CEO will
have authority, subject to the express provisions of the Plan, (i) to determine
which non-officer employees of the Company will receive such stock options, (ii)
to determine the number of shares of Common Stock issuable upon the exercise of
any such stock options, and (iii) to determine the terms and provisions of each
stock option grant.

3.  Eligibility.

         Options shall be granted only to persons who are, at the time of grant,
officers, directors, employees of, or consultants or advisors to the Company or
of any Parent Corporation or Subsidiary (as defined in Section 17 hereof).

4.  Stock Subject to Plan.

         Subject to adjustment as provided in Sections 15 and 16 below, the
maximum number of shares of Common Stock of the Company which may be issued and
sold under the Plan is 1,500,000 shares. Such shares may be authorized and
unissued shares or may be shares issued and thereafter acquired by the Company.
If an option granted under the Plan shall expire or terminate for any reason
without having been exercised in full, the unpurchased shares subject to such
option shall again be available for subsequent option grants under the Plan.
Stock issuable upon exercise of an option granted under the Plan may be subject
to such restrictions on transfer, repurchase rights or other restrictions as
shall be determined by the Board of Directors.

5.  Option Agreements.

         As a condition to the grant of an option under the Plan, each recipient
of an option shall execute an option agreement not inconsistent with the Plan as
the Board of Directors shall determine at the time such option is authorized to
be granted. Such agreements need not be identical but shall comply with, and be
subject to, the terms and conditions set forth herein.

6.  Purchase Price.

         The purchase price per share of stock deliverable upon the exercise of
an option shall be determined by the Board of Directors on the date such option
is authorized to be granted. Payment of the exercise price of an option shall be
in cash or, in the sole discretion of the Board of Directors, in capital stock
of the Company, by the surrender of other options to purchase capital stock of
the Company, by purchase money note bearing interest at a rate and coming due in
installments determined by the Board of Directors at the time the option is
granted, or by any other lawful means.

7.  Option Period.

         Each option and all rights thereunder shall be expressed to expire on
such date as the Board of Directors shall determine on the date such option is
authorized to be granted, but in no event after the expiration of ten years from
the day on which the option is granted and shall be
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subject to earlier termination as provided in the Plan. Notwithstanding the
foregoing, if at any time during the last six (6) months of the term of any
option granted under the Plan, the holder thereof is precluded from selling
shares of Common Stock underlying such option solely by reason of the
application to such optionee of the Company's policy regarding "Material Insider
Information and Insider Trading" (or similar successor policy), the term of such
option shall be deemed automatically extended by a period equal to six (6)
months beginning with the first day during which such optionee shall no longer
be so precluded.

8.  Exercise of Options.

         Each option granted under the Plan shall be exercisable either in full
or in installments at such time or times and during such period as shall be set
forth in the agreement evidencing such option; provided, however, that, subject
to Section 7, (i) no option granted under the Plan shall have a term in excess
of ten years from the date of grant, and (ii) the periods of time following the
optionee's cessation of employment with the Company or service as an Outside
Director (as hereinafter defined) of or consultant or advisor to the Company, or
the optionee's death or disability, during which an option may be exercised, as
provided in paragraphs (a), (b) and (c) of Section 10, shall not be included for
purposes of determining the number of shares of Common Stock with respect to
which an option granted under the Plan may be exercised. An Outside Director is
a director who is not an employee of the Company or of any Parent Corporation or
Subsidiary.

9.  Nontransferability of Options.

         Except as otherwise approved by the Board of Directors, no option
granted under the Plan shall be assignable or transferable by the person to whom
it is granted, either voluntarily or by operation of law, except by will or the
laws of descent and distribution. Subject to the preceding sentence, during the
life of the recipient, the option shall be exercisable only by or on behalf of
such person.

10. Effect of Termination of Employment or Cessation of Services.

         Notwithstanding anything contained in this Plan to the contrary, no
option may be exercised unless, at the time of such exercise, the optionee is,
and has been continuously since the date of grant of his or her option, employed
by or serving as an Outside Director of one or more of the Company, a Parent
Corporation or a Subsidiary, except that if and to the extent the option
agreement or instrument so provides:

         (a) if the optionee ceases to be employed by or serve as an Outside
Director of or consultant or advisor to any of the foregoing entities for any
reason other than death or disability, the right to exercise the option shall
terminate three months after such cessation (or at such earlier date as may be
specified in the option agreement or instrument);

         (b) if the optionee dies while in the employ of or while serving as an
outside Director of or consultant or advisor to any of the foregoing entities or
within three months after the optionee
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ceases to be such an employee or director, the option may be exercised by the
person to whom it is transferred by will or the laws of descent and distribution
within the period of one year after the date of death (or within such lesser
period as may be specified in the option agreement or instrument); and

         (c) if the optionee becomes disabled (within the meaning of Section
22(e)(3) of the Code) while in the employ of or while serving as an Outside
Director of or consultant or advisor to any of the foregoing entities, the
option may be exercised within the period of one year after the date the
optionee ceases to be such an employee, Outside Director, consultant or advisor
because of such disability (or within such lesser period as may be specified in
the option agreement or instrument); provided, however, that in no event may any
option be exercised after the expiration date of the option. For all purposes of
the Plan and any option granted hereunder, "employment" shall be defined in
accordance with the provisions of Section 1.421-7(h) of the Income Tax
Regulations (or any successor regulations).

11.  General Restrictions.

         (a) Investment Representations. The Company may require any person to
whom an option is granted, as a condition of exercising such option, to give
written assurances in substance and form satisfactory to the Company to the
effect that such person is acquiring the Common Stock subject to the option for
his own account for investment and not with any present intention of selling or
otherwise distributing the same, and to such other effects as the Company deems
necessary or appropriate in order to comply with federal and applicable state
securities laws.

         (b) Compliance With Securities Laws. Each option shall be subject to
the requirement that, if at any time counsel to the Company shall determine that
the listing, registration or qualification of the shares subject to such option
upon any securities exchange or under any state or federal law, or the consent
or approval of any governmental or regulatory body, is necessary as a condition
of, or in connection with, the issuance or purchase of shares thereunder, such
option may not be accepted or exercised in whole or in part unless such listing,
registration, qualification, consent or approval shall have been effected or
obtained on conditions acceptable to the Board of Directors. Nothing herein
shall be deemed to require the Company to apply for or to obtain such listing,
registration or qualification.

12. Rights as a Stockholder.

         The holder of an option shall have no rights as a stockholder with
respect to any shares covered by the option until the date of issue of a stock
certificate to him or her for such shares. Except as otherwise expressly
provided in the Plan, no adjustment shall be made for dividends or other rights
for which the record date is prior to the date such stock certificate is issued.

13.  Recapitalization.

         In the event that the outstanding shares of Common Stock of the Company
are changed
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into or exchanged for a different number or kind of shares or other securities
of the Company by reason of any recapitalization, reclassification, stock split,
stock dividend, combination or subdivision, appropriate adjustment shall be made
in the number and kind of shares available under the Plan and under any options
granted under the Plan. Such adjustment to outstanding options shall be made
without change in the total price applicable to the unexercised portion of such
options, and a corresponding adjustment in the applicable option price per share
shall be made. No such adjustment shall be made which would, within the meaning
of any applicable provisions of the Code, constitute a modification, extension
or renewal of any option or a grant of additional benefits to the holder of an
option.

14. Reorganization or Change in Control of the Company.

(a) Reorganization. In case (i) the Company is merged or consolidated with
another corporation and the Company is not the surviving corporation, (ii) all
or substantially all of the assets or more than 50% of the outstanding voting
stock of the Company is acquired by any other corporation or (iii) of a
reorganization or liquidation of the Company, the Board of Directors of the
Company, or the board of directors of any corporation assuming the obligations
of the Company, shall, as to outstanding options, either (x) make appropriate
provision for the protection of any such outstanding options by the substitution
on an equitable basis of appropriate stock of the Company, or of the merged,
consolidated or otherwise reorganized corporation which will be issuable in
respect of the shares of Common Stock of the Company, provided that no
additional benefits shall be conferred upon optionees as a result of such
substitution, and the excess of the aggregate fair market value of the shares
subject to the options immediately after such substitution over the purchase
price thereof is not more than the excess of the aggregate fair market value of
the shares subject to the option immediately before such substitution over the
purchase price thereof, or (y) upon written notice to the optionees, provide
that all unexercised options must be exercised within a specified number of days
of the date of such notice or they will be terminated. In any such case, the
Board of Directors may, in its discretion, accelerate the exercise dates of
outstanding options; provided, however, that paragraph (b) below shall govern
acceleration of options with respect to the events described in clauses (i),
(ii) and (iii) of such paragraph.

(b) Change in Control. In case of (i) any merger or consolidation (an "Event")
involving the Company, if the shareholders of the Company immediately before
such Event do not own, directly or indirectly, immediately following such Event,
more than fifty percent (50%) of the combined voting power of the outstanding
voting securities of the corporation resulting from such Event in substantially
the same proportion as their ownership of the shares of Common Stock immediately
before such Event; (ii) any sale, lease, license, exchange or other transfer (in
one transaction or a series of related transactions) of all, or substantially
all, of the business and/or assets of the Company or assets representing over
50% of the operating revenue of the Company; or (iii) any person (as such term
is used in Sections 13(d) and 14(d) of the Exchange Act) who was not, on
December 2, 1998, a "controlling person" (as defined in Rule 405 under the
Securities Act of 1933, as amended) (a "Controlling Person") of the Company
shall become (x) the beneficial owner (within the meaning of Rule 13d-3 under
the Exchange Act) of over 50% of the combined voting power of the Company's then
outstanding voting securities entitled
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to vote generally or (y) a Controlling Person of the Company, all outstanding
Options, regardless of the date of such Options, shall immediately become
exercisable with respect to 100% of the Common Stock subject to such Options."

15.  No Special Employment Rights.

         Nothing contained in the Plan or in any option granted under the Plan
shall confer upon any option holder any right with respect to the continuation
of his or her employment by the Company (or any Parent Corporation or
Subsidiary) or interfere in any way with the right of the Company (or any Parent
Corporation or Subsidiary), subject to the terms of any separate employment
agreement to the contrary, at any time to terminate such employment or to
increase or decrease the compensation of the option holder from the rate in
existence at the time of the grant of an option. Whether an authorized leave of
absence, or absence in military or government service, shall constitute
termination or cessation of employment for purposes of this Plan shall be
determined by the Board of Directors.

16.  Other Employee Benefits.

         The amount of any taxable income deemed to be received by an employee
as a result of the exercise of an option or the sale of shares received upon
such exercise will not constitute "earnings" with respect to which any other
employee benefits of such employee are determined, including without limitation
benefits under any pension, profit sharing, life insurance or salary
continuation plan.

17. Definition of Subsidiary and Parent Corporation.

         (a) Subsidiary. The term "Subsidiary" as used in the Plan shall mean
         any corporation in an unbroken chain of corporations beginning with the
         Company if each of the corporations other than the last corporation in
         the unbroken chain owns stock possessing 50% or more of the total
         combined voting power of all classes of stock in one of the other
         corporations in such chain.

         (b) Parent Corporation. The term "Parent Corporation" as used in the
Plan shall mean any corporation (other than the Company) in an unbroken chain of
corporations ending with the Company if each of the corporations other than the
Company owns stock possessing 50% or more of the combined voting power of all
classes of stock in one of the other corporations in such chain.

18. Amendment of the Plan.

         The Board of Directors may at any time and from time to time modify,
amend or terminate the Plan in any respect, except to the extent stockholder
approval is required by law. The termination or any modification or amendment of
the Plan shall not, without the consent of an optionee, affect his or her rights
under an option previously granted to him or her. With the consent of the
optionee affected, the Board of Directors may amend outstanding option
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agreements in a manner not inconsistent with the Plan.

19.  Withholding.

              The Company's obligation to deliver shares upon the exercise of
any option granted under the Plan shall be subject to the option holder's
satisfaction of all applicable federal, state and local income and employment
tax withholding requirements.

20. Effective Date and Duration of the Plan.

         (a) Effective Date. The Plan shall become effective when adopted by the
Board of Directors.

         (b) Termination. Unless earlier terminated by the Board of Directors,
the Plan shall terminate upon the earlier of (i) the close of business on the
day next preceding the tenth anniversary of the date of its adoption by the
Board of Directors, or (ii) the date on which all shares available for issuance
under the Plan shall have been issued pursuant to the exercise or cancellation
of options granted under the Plan. If the date of termination is determined
under (i) above, then options outstanding on such date shall continue to have
force and effect in accordance with the provisions of the instruments evidencing
such options.