ARKONA, INC.
                                  ------------

                            2001 STOCK INCENTIVE PLAN
                            -------------------------

         1. Purpose.  The purpose of this 2001 Incentive Stock Plan (the "Plan")
is to enable Arkona,  Inc. (the "Company") to attract and retain the services of
(i) selected  employees,  officers and directors of the Company or any parent or
subsidiary of the Company and (ii)  selected  nonemployee  agents,  consultants,
advisers and independent  contractors of the Company or any parent or subsidiary
of the Company. For purposes of this Plan, a person is considered to be employed
by or in the  service  of the  Company if the  person is  employed  by or in the
service  of  the  Company  or any  parent  or  subsidiary  of  the  Company  (an
"Employer").

         2. Shares Subject to the Plan.  Subject to adjustment as provided below
and in Section  10, the  shares to be  offered  under the Plan shall  consist of
Common Stock of the Company, and the total number of shares of Common Stock that
may be  issued  under  the Plan  shall be  6,000,000  shares.  If an  option  or
Performance-based  Award (as  defined  below)  granted  under the Plan  expires,
terminates  or is  canceled,  the  unissued  shares  subject  to that  option or
Performance-based  Award  shall  again be  available  under the Plan.  If shares
awarded as a bonus pursuant to Section 7 or sold pursuant to Section 8 under the
Plan are  forfeited  to or  repurchased  by the  Company,  the  number of shares
forfeited or repurchased shall again be available under the Plan.

         3. Effective Date and Duration of Plan.

            3.1 Effective  Date. The Plan shall become  effective as of December
1, 2001. Options, and Performance-based  Awards may be granted and shares may be
awarded as bonuses or sold under the Plan at any time after the  effective  date
and before termination of the Plan.

            3.2  Duration.  The Plan shall  continue in effect  until all shares
available for issuance under the Plan have been issued and all  restrictions  on
the shares have lapsed. The Board of Directors may suspend or terminate the Plan
at any time except with respect to options,  Performance-based Awards and shares
subject to restrictions then outstanding  under the Plan.  Termination shall not
affect  any  outstanding  options,  Performance-based  Awards,  any right of the
Company to repurchase  shares or the  forfeitability  of shares issued under the
Plan.

          4. Administration.

            4.1 Board of Directors.  The Plan shall be administered by the Board
of Directors of the Company, which shall determine and designate the individuals
to whom awards  shall be made,  the amount of the awards and the other terms and
conditions of the awards.  Subject to the  provisions of the Plan,  the Board of
Directors may adopt and amend rules and regulations  relating to  administration
of the Plan,  advance the lapse of any waiting  period,  accelerate any exercise


                                       1
<PAGE>

date,  waive or  modify  any  restriction  applicable  to shares  (except  those
restrictions  imposed by law) and make all other  determinations in the judgment
of the Board of Directors  necessary or desirable for the  administration of the
Plan.  The  interpretation  and  construction  of the provisions of the Plan and
related agreements by the Board of Directors shall be final and conclusive.  The
Board of  Directors  may correct any defect or supply any  omission or reconcile
any  inconsistency in the Plan or in any related  agreement in the manner and to
the extent it deems  expedient to carry the Plan into  effect,  and the Board of
Directors shall be the sole and final judge of such expediency.

            4.2 Committee.  The Board of Directors may delegate to any committee
of  the  Board  of  Directors  (the   "Committee")  any  or  all  authority  for
administration  of the Plan.  If authority is  delegated to the  Committee,  all
references  to the Board of  Directors  in the Plan shall mean and relate to the
Committee,  except (i) as otherwise  provided by the Board of Directors and (ii)
only the Board of  Directors  may amend or  terminate  the Plan as  provided  in
Sections 3, 10 and 11.

         5. Types of Awards;  Eligibility;  Limitations.  The Board of Directors
may,  from  time  to  time,  take  the  following  actions,   separately  or  in
combination,  under the Plan:  (i) grant  options that are not  Incentive  Stock
Options as  defined in Section  422 of the  Internal  Revenue  Code of 1986,  as
amended (the "Code")  ("Non-Statutory Stock Options");  (ii) award stock bonuses
as  provided  in Section 7; and (iii) sell  shares  subject to  restrictions  as
provided  in Section 8; and (iv) award  Performance-based  Awards as provided in
Section 9. Awards may be made to employees, including employees who are officers
or directors,  and to other individuals  described in Section 1 selected by 5the
Board of Directors.  The Board of Directors shall select the individuals to whom
awards  shall be made and shall  specify the action  taken with  respect to each
individual  to  whom an  award  is  made.  At the  discretion  of the  Board  of
Directors,  an  individual  may be given an  election to  surrender  an award in
exchange for the grant of a new award.

         6. Option Grants.

            6.1 Terms of Grant.  The Board of Directors  may grant options under
the Plan.  With  respect to each  option  grant,  the Board of  Directors  shall
determine the number of shares subject to the option,  the exercise  price,  the
period of the option and the time or times at which the option may be exercised,
and any other terms,  conditions or restrictions  related to the Option.  At the
time of the grant of an option or at any time thereafter, the Board of Directors
may provide  that an optionee  who  exercised an option with Common Stock of the
Company shall  automatically  receive a new option to purchase additional shares
equal to the  number  of  shares  surrendered  and may  specify  the  terms  and
conditions of such new options.

            6.2  Exercise  of  Options.  Except as provided in Section 6.4 or as
determined  by the Board of Directors,  no option  granted under the Plan may be
exercised  unless at the time of exercise  the optionee is employed by or in the
service of the Company and shall have been so employed or provided  such service
continuously  since the date the  option  was  granted.  Except as  provided  in


                                       2
<PAGE>

Sections 6.4 and 10,  options  granted under the Plan may be exercised from time
to time over the period stated in each option in amounts and at times prescribed
by the Board of  Directors,  provided  that  options  may not be  exercised  for
fractional  shares.  In the  event  the Board of  Directors  does not  specify a
vesting schedule for any Option at the time of grant,  such option (a) shall not
be  exercisable  until  12  months  after  the  Grant  Date,  (b)  shall  become
exercisable  for 1/3 of the total number of shares subject thereto at the end of
12 months following the grant date and (c) shall become exercisable with respect
to 1/36 of the total  number of shares at the end of each month  thereafter,  so
that the option will be fully exercisable on the third anniversary of the grant.
Unless otherwise  determined by the Board of Directors,  if an optionee does not
exercise  an option  in any one year for the full  number of shares to which the
optionee is entitled in that year, the optionee's rights shall be cumulative and
the optionee may purchase those shares in any subsequent year during the term of
the option.

            6.3 Nontransferability.  Unless otherwise determined by the Board of
Directors (either at or following the time of grant),  each other option granted
under the Plan by its terms (i) shall be nonassignable  and  nontransferable  by
the optionee,  either  voluntarily or by operation of law,  except by will or by
the laws of descent and  distribution  of the state or country of the optionee's
domicile at the time of death, and (ii) during the optionee's lifetime, shall be
exercisable only by the optionee.

            6.4 Termination of Employment or Service.

                6.4(a) General Rule. Unless otherwise determined by the Board of
        Directors  (either at or following the time of grant),  if an optionee's
        employment or service with the Company  terminates  for any reason other
        than because of total disability or death as provided in Sections 6.1(b)
        and 6.1(c),  his or her option may be  exercised  at any time before the
        expiration  date of the  option or the  expiration  of 30 days after the
        date of termination, whichever is the shorter period, but only if and to
        the extent the  optionee was entitled to exercise the option at the date
        of termination.

                6.4(b) Termination Because of Total Disability. Unless otherwise
        determined  by the Board of Directors,  if an  optionee's  employment or
        service with the Company terminates because of total disability,  his or
        her option may be  exercised at any time before the  expiration  date of
        the option or before the date 12 months  after the date of  termination,
        whichever  is the  shorter  period,  but only if and to the  extent  the
        optionee was entitled to exercise the option at the date of termination.
        The term "total  disability"  means a medically  determinable  mental or
        physical impairment that is expected to result in death or has lasted or
        is  expected  to last for a  continuous  period of 12 months or more and
        that,  in the  opinion of the Company  and two  independent  physicians,
        causes  the  optionee  to be unable to  perform  his or her duties as an
        employee,  director, officer or consultant of the Employer and unable to
        be engaged in any substantial  gainful activity.  Total disability shall
        be deemed to have  occurred  on the first day after the two  independent
        physicians have furnished  their written opinion of total  disability to
        the Company and the Company has reached an opinion of total disability.



                                       3
<PAGE>

                6.4(c) Termination Because of Death. Unless otherwise determined
        by the Board of  Directors,  if an  optionee  dies while  employed by or
        providing service to the Company,  his or her option may be exercised at
        any time before the expiration  date of the option or before the date 12
        months  after the date of death,  whichever is the shorter  period,  but
        only if and to the extent the  optionee  was  entitled to  exercise  the
        option at the date of death and only by the  person or  persons  to whom
        the optionee's rights under the option shall pass by the optionee's will
        or by the laws of descent  and  distribution  of the state or country of
        domicile at the time of death.

                6.4(d)  Amendment of Exercise Period  Applicable to Termination.
        The Board of  Directors  may at any time extend the 30-day and  12-month
        exercise  periods  any  length  of time not  longer  than  the  original
        expiration  date of the option.  The Board of Directors  may at any time
        increase the portion of an option that is exercisable,  subject to terms
        and conditions determined by the Board of Directors.

                6.4(e) Failure to Exercise Option. To the extent that the option
        of any deceased  optionee or any optionee  whose  employment  or service
        terminates is not exercised  within the applicable  period,  all further
        rights  to  purchase  shares  pursuant  to the  option  shall  cease and
        terminate.

                6.4(f)  Leave  of  Absence.  Absence  on leave  approved  by the
        Employer  or on account of illness or  disability  shall not be deemed a
        termination or interruption of employment or service.  Unless  otherwise
        determined by the Board of Directors,  vesting of options shall continue
        during a medical,  family or military leave of absence,  whether paid or
        unpaid,  and  vesting of  options  shall be  suspended  during any other
        unpaid leave of absence.

            6.5 Purchase of Shares.

                6.5(a)  Notice  of  Exercise.  Unless  the  Board  of  Directors
        determines  otherwise,  shares  may be  acquired  pursuant  to an option
        granted under the Plan only upon the Company's receipt of written notice
        from the  optionee  of the  optionee's  binding  commitment  to purchase
        shares, specifying the number of shares the optionee desires to purchase
        under the option and the date on which the  optionee  agrees to complete
        the  transaction,  and, if required to comply with the Securities Act of
        1933 and/or governing state securities laws, containing a representation
        that it is the optionee's intention to acquire the shares for investment
        and not with a view to distribution.

                6.5(b)  Payment.   Unless  the  Board  of  Directors  determines
        otherwise  (either at or following the time or grant),  on or before the
        date specified for  completion of the purchase of shares  pursuant to an


                                       4
<PAGE>

        option  exercise,  the optionee  must pay the Company the full  purchase
        price of those  shares in cash or by check or,  with the  consent of the
        Board of Directors,  in whole or in part, in Common Stock of the Company
        valued at fair market value, restricted stock or other contingent awards
        denominated in either stock or cash, promissory notes and other forms of
        consideration.  Unless  otherwise  determined by the Board of Directors,
        any Common  Stock  provided in payment of the  purchase  price must have
        been  previously  acquired  and held by the  optionee  for at least  six
        months. The fair market value of Common Stock provided in payment of the
        purchase  price  shall be the  closing  price of the  Common  Stock last
        reported before the time payment in Common Stock is made or, if earlier,
        committed to be made, if the Common Stock is publicly traded, or another
        value of the Common  Stock as specified  by the Board of  Directors.  No
        shares  shall be issued until full payment for the shares has been made,
        including all amounts owed for tax withholding.  With the consent of the
        Board of  Directors,  an  optionee  may  request  the  Company  to apply
        automatically  the shares to be received  upon the exercise of a portion
        of a stock  option (even  though  stock  certificates  have not yet been
        issued) to satisfy the  purchase  price for  additional  portions of the
        option.

                6.5(c) Tax  Withholding.  Each  optionee  who has  exercised  an
        option shall,  immediately upon  notification of the amount due, if any,
        pay to the Company in cash or by check amounts  necessary to satisfy any
        applicable  federal,  state and local tax withholding  requirements.  If
        additional  withholding is or becomes  required (as a result of exercise
        of an option or as a result of disposition of shares  acquired  pursuant
        to exercise of an option) beyond any amount deposited before delivery of
        the  certificates,  the optionee  shall pay such  amount,  in cash or by
        check, to the Company on demand. If the optionee fails to pay the amount
        demanded,  the Company or the  Employer  may  withhold  that amount from
        other amounts  payable to the  optionee,  including  salary,  subject to
        applicable law. With the consent of the Board of Directors,  an optionee
        may satisfy this  obligation,  in whole or in part, by  instructing  the
        Company to  withhold  from the shares to be issued  upon  exercise or by
        delivering  to the  Company  other  shares  of Common  Stock;  provided,
        however,  that the number of shares so withheld or  delivered  shall not
        exceed the minimum amount necessary to satisfy the required  withholding
        obligation.

                6.5(d)  Reduction  of Reserved  Shares.  Upon the exercise of an
        option,  the number of shares reserved for issuance under the Plan shall
        be reduced by the number of shares  issued  upon  exercise of the option
        (less the number of any shares  surrendered  in payment for the exercise
        price or withheld to satisfy withholding requirements).

            6.6 Limitations on Grants to Non-Exempt Employees.  Unless otherwise
determined  by the Board of  Directors,  if an  employee  of the  Company or any
parent or  subsidiary  of the Company is a  non-exempt  employee  subject to the
overtime  compensation  provisions of Section 7 of the Fair Labor  Standards Act
(the  "FLSA"),  any  option  granted  to that  employee  shall be subject to the


                                       5
<PAGE>

following restrictions: (i) the option price shall be at least 85 percent of the
fair market value, as described in Section 6.2 4, of the Common Stock subject to
the  option  on the  date it is  granted;  and  (ii)  the  option  shall  not be
exercisable  until at least six months  after the date it is granted;  provided,
however,  that this six-month  restriction on exercisability will cease to apply
if the  employee  dies,  becomes  disabled  or  retires,  there is a  change  in
ownership of the Company, or in other circumstances permitted by regulation, all
as prescribed in Section 7(e)(8)(B) of the FLSA.

         7. Stock  Bonuses.  The Board of  Directors  may award shares under the
Plan as stock bonuses.  Shares awarded as a bonus shall be subject to the terms,
conditions  and  restrictions   determined  by  the  Board  of  Directors.   The
restrictions may include restrictions concerning  transferability and forfeiture
of the shares awarded,  together with any other  restrictions  determined by the
Board of Directors.  The Board of Directors may require the recipient to sign an
agreement as a condition of the award,  but may not require the recipient to pay
any  monetary   consideration  other  than  amounts  necessary  to  satisfy  tax
withholding  requirements.  The  agreement  may contain  any terms,  conditions,
restrictions, representations and warranties required by the Board of Directors.
The certificates representing the shares awarded shall bear any legends required
by the Board of  Directors.  The Company may  require any  recipient  of a stock
bonus to pay to the Company in cash or by check upon demand amounts necessary to
satisfy any applicable federal, state or local tax withholding requirements.  If


                                       6
<PAGE>

the recipient fails to pay the amount demanded,  the Company or the Employer may
withhold  that amount from other  amounts  payable to the  recipient,  including
salary, subject to applicable law. With the consent of the Board of Directors, a
recipient may satisfy this  obligation,  in whole or in part, by instructing the
Company to withhold from any shares to be issued or by delivering to the Company
other shares of Common Stock;  provided,  however,  that the number of shares so
withheld or delivered  shall not exceed the minimum amount  necessary to satisfy
the required  withholding  obligation.  Upon the issuance of a stock bonus,  the
number of shares  reserved for  issuance  under the Plan shall be reduced by the
number of shares  issued,  less the number of shares  withheld or  delivered  to
satisfy withholding obligations.

         8. Restricted  Stock. The Board of Directors may issue shares under the
Plan for any consideration  (including promissory notes and services) determined
by the Board of Directors.  Shares issued under the Plan shall be subject to the
terms,  conditions and  restrictions  determined by the Board of Directors.  The
restrictions may include restrictions concerning transferability,  repurchase by
the  Company  and  forfeiture  of the  shares  issued,  together  with any other
restrictions  determined  by the Board of  Directors.  All Common  Stock  issued
pursuant to this Section 8 shall be subject to a purchase agreement, which shall
be executed by the Company and the  prospective  purchaser of the shares  before
the  delivery of  certificates  representing  the shares to the  purchaser.  The
purchase   agreement   may   contain   any  terms,   conditions,   restrictions,
representations  and  warranties  required  by  the  Board  of  Directors.   The
certificates  representing  the shares  shall bear any  legends  required by the
Board of Directors. The Company may require any purchaser of restricted stock to
pay to the Company in cash or by check upon demand amounts  necessary to satisfy
any applicable  federal,  state or local tax  withholding  requirements.  If the
purchaser  fails to pay the amount  demanded,  the Company or the  Employer  may
withhold  that amount from other  amounts  payable to the  purchaser,  including
salary, subject to applicable law. With the consent of the Board of Directors, a
purchaser may satisfy this  obligation,  in whole or in part, by instructing the
Company to withhold from any shares to be issued or by delivering to the Company
other shares of Common Stock;  provided,  however,  that the number of shares so
withheld or delivered  shall not exceed the minimum amount  necessary to satisfy
the required withholding obligation.  Upon the issuance of restricted stock, the
number of shares  reserved for  issuance  under the Plan shall be reduced by the
number of shares  issued,  less the number of shares  withheld or  delivered  to
satisfy withholding obligations.

         9.  Performance-based  Awards.  To the extent  counsel  for the Company
determines  that the  applicable  grants to qualify,  the Board of Directors may
grant  awards  intended to qualify as qualified  performance-based  compensation
under   Section   162(m)   of  the   Code   and   the   regulations   thereunder
("Performance-based  Awards").  Performance-based Awards shall be denominated at
the time of grant  either in Common  Stock  ("Stock  Performance  Awards") or in
dollar amounts ("Dollar Performance Awards").  Payment under a Stock Performance
Award or a Dollar  Performance  Award shall be made,  at the  discretion  of the
Board of Directors, in Common Stock ("Performance Shares"), or in cash or in any
combination thereof.  Performance-based Awards shall be subject to the following
terms and conditions:

             9.1 Award Period. The Board of Directors shall determine the period
of time for which a Performance-based Award is made (the "Award Period").


             9.2  Performance  Goals and Payment.  The Board of Directors  shall
establish in writing  objectives  ("Performance  Goals") that must be met by the
Company or any  subsidiary,  division  or other unit of the  Company  ("Business
Unit")  during the Award Period as a condition  to payment  being made under the
Performance-based  Award.  The Performance  Goals for each award shall be one or
more targeted levels of performance with respect to one or more of the following
objective  measures with respect to the Company or any Business Unit:  earnings,
earnings per share, stock price increase,  total shareholder return (stock price
increase plus dividends), return on equity, return on assets, return on capital,
economic value added, revenues, operating income, inventories,  inventory turns,
cash  flows  or  any  of  the  foregoing  before  the  effect  of  acquisitions,
divestitures,   accounting  changes,   and  restructuring  and  special  charges
(determined  according to criteria  established by the Board of Directors).  The
Board of Directors shall also establish the number of Performance  Shares or the
amount  of cash  payment  to be  made  under a  Performance-based  Award  if the
Performance Goals are met or exceeded, including the fixing of a maximum payment
(subject  to  Section  9.4).   The  Board  of  Directors  may  establish   other
restrictions  to payment under a  Performance-based  Award,  such as a continued
employment  requirement,  in addition to satisfaction of the Performance  Goals.
Some or all of the Performance  Shares may be issued at the time of the award as
restricted shares subject to forfeiture in whole or in part if Performance Goals
or, if applicable, other restrictions are not satisfied.



                                       7
<PAGE>

             9.3  Computation of Payment.  During or after an Award Period,  the
performance of the Company or Business  Unit, as  applicable,  during the period
shall be measured  against the Performance  Goals. If the Performance  Goals are
not met,  no  payment  shall be made  under a  Performance-based  Award.  If the
Performance Goals are met or exceeded, the Board of Directors shall certify that
fact in writing  and  certify  the number of  Performance  Shares  earned or the
amount of cash  payment  to be made  under  the  terms of the  Performance-based
Award.

             9.4 Maximum  Awards.  No participant may receive in any fiscal year
Stock  Performance  Awards under which the  aggregate  amount  payable under the
Awards  exceeds  the  equivalent  of  500,000  shares of Common  Stock or Dollar
Performance  Awards under which the  aggregate  amount  payable under the Awards
exceeds $500,000.

             9.5 Tax Withholding.  Each participant who has received Performance
Shares shall, upon notification of the amount due, pay to the Company in cash or
by check amounts  necessary to satisfy any applicable  federal,  state and local
tax  withholding  requirements.  If the  participant  fails  to pay  the  amount
demanded,  the  Company or the  Employer  may  withhold  that  amount from other
amounts payable to the participant, including salary, subject to applicable law.
With the consent of the Board of  Directors,  a  participant  may  satisfy  this
obligation, in whole or in part, by instructing the Company to withhold from any
shares to be issued  or by  delivering  to the  Company  other  shares of Common
Stock;  provided,  however,  that the number of shares so  delivered or withheld
shall  not  exceed  the  minimum  amount   necessary  to  satisfy  the  required
withholding obligation.

             9.6 Effect on Shares Available.  The payment of a Performance-based
Award in cash shall not reduce the number of shares of Common Stock reserved for
issuance  under the Plan.  The  number of shares of Common  Stock  reserved  for
issuance  under the Plan shall be reduced  by the number of shares  issued  upon
payment of an award,  less the number of shares delivered or withheld to satisfy
withholding obligations.

          10. Changes in Capital Structure.

             10.1 Stock Splits, Stock Dividends. If the outstanding Common Stock
of the Company is hereafter  increased or decreased or changed into or exchanged
for a different  number or kind of shares or other  securities of the Company by
reason of any stock split,  combination of shares,  dividend  payable in shares,
recapitalization or  reclassification,  appropriate  adjustment shall be made by
the Board of  Directors  in the number and kind of shares  available  for grants
under  the Plan and in all  other  share  amounts  set  forth  in the  Plan.  In
addition, the Board of Directors shall make appropriate adjustment in the number
and kind of shares as to which  outstanding  options,  or portions  thereof then
unexercised, shall be exercisable, so that the optionee's proportionate interest
before and after the occurrence of the event is maintained.  Notwithstanding the
foregoing,  the Board of  Directors  shall  have no  obligation  to  effect  any
adjustment that would or might result in the issuance of fractional  shares, and


                                       8
<PAGE>

any  fractional  shares  resulting  from any  adjustment  may be  disregarded or
provided  for in any  manner  determined  by the  Board of  Directors.  Any such
adjustments made by the Board of Directors shall be conclusive.

             10.2  Mergers,  Reorganizations,  Etc.  In the  event of a  merger,
consolidation,  plan of exchange,  acquisition  of property or stock,  split-up,
split-off,  spin-off,  reorganization  or  liquidation to which the Company is a
party,  any sale,  lease,  exchange or other  transfer (in one  transaction or a
series of related  transactions) of all, or substantially  all, of the assets of
the  Company,  or the transfer by one or more  shareholders,  in one transfer or
several related transfers, of 50% of more of the Common Stock outstanding on the
date of such transfer (or the first of such related transfers) to persons, other
than  wholly-owned  subsidiaries or family trusts,  who were not shareholders of
the Company prior to the first such transfer (each, a "Transaction"),  the Board
of Directors  shall, in its sole discretion and to the extent possible under the
structure  of the  Transaction,  select one of the  following  alternatives  for
treating  outstanding  options under the Plan prior to the  consummation  of the
Transaction:

                   10.2(a)   Outstanding  options  shall  remain  in  effect  in
         accordance with their terms.

                   10.2(b)  Outstanding  options shall be converted into options
         to purchase  stock in one or more of the  corporations,  including  the
         Company,  that  are the  surviving  or  acquiring  corporations  in the
         Transaction.  The  amount,  type  of  securities  subject  thereto  and
         exercise  price of the  converted  options  shall be  determined by the
         Board of  Directors  of the  Company,  taking into account the relative
         values of the companies  involved in the  Transaction  and the exchange
         rate,   if  any,   used  in   determining   shares  of  the   surviving
         corporation(s) to be held by holders of shares of the Company following
         the Transaction. Unless otherwise determined by the Board of Directors,
         the  converted  options  shall be vested  only to the  extent  that the
         vesting  requirements  relating to options granted  hereunder have been
         satisfied.

                   10.2(c) The Board of  Directors  shall  provide a period of a
         least 10 days before the  completion  of the  Transaction  during which
         outstanding  options may be exercised,  to the extent then exercisable,
         and upon the expiration of that period,  all unexercised  options shall
         immediately terminate. The Board of Directors may, its sole discretion,
         accelerate the  exercisability  of options so that they are exercisable
         in full during that period.

                   10.3  Dissolution  of  the  Company.  In  the  event  of  the
         dissolution of the Company, options shall be treated in accordance with
         Section 10.2(c).

                   10.4  Rights  Issued  by  Another  Corporation.  The Board of
         Directors    may   also   grant   options   and   stock   bonuses   and
         Performance-based Awards and issue restricted stock under the Plan with
         terms,  conditions and provisions that vary from those specified in the
         Plan, provided that any such awards are granted in substitution for, or
         in connection with the assumption of, existing options,  stock bonuses,


                                       9
<PAGE>

         Performance-based  Awards  and  restricted  stock  granted,  awarded or
         issued by another  corporation  and assumed or  otherwise  agreed to be
         provided for by the Company pursuant to or by reason of a Transaction.

         11.  Amendment  of the  Plan.  The Board of  Directors  may at any time
modify or amend the Plan in any  respect.  Except as  provided  in  Section  10,
however, no change in an award already granted shall be made without the written
consent  of the  holder of the award if the change  would  adversely  affect the
holder.

         12. Approvals.  The Company's obligations under the Plan are subject to
the approval of state and federal  authorities or agencies with  jurisdiction in
the matter.  The  Company  will use its best  efforts to take steps  required by
state or federal law or applicable regulations,  including rules and regulations
of the  Securities  and Exchange  Commission and any stock exchange on which the
Company's  shares may then be listed,  in  connection  with the grants under the
Plan. The foregoing notwithstanding, the Company shall not be obligated to issue
or deliver  Common  Stock  under the Plan if such  issuance  or  delivery  would
violate state or federal  securities laws. Unless the Company  determines,  with
advice of counsel that such legend is not necessary,  certificates  representing
all shares of Common  Stock  issued in  connection  with the Plan will contain a
legend indicating that such shares of Common Stock are "restricted  securities,"
as defined  under Rule 144  promulgated  under the  Securities  Act of 1933,  as
amended,  and that such shares may not be  transferred  unless such  transfer is
registered  under the  Securities  Act and governing  state  securities  laws or
exempt from the registration requirements of the same.

         13.  Employment  and Service  Rights.  Nothing in the Plan or any award
pursuant  to the Plan  shall  (i)  confer  upon  any  employee  any  right to be
continued  in the  employment  of an Employer or  interfere  in any way with the
Employer's right to terminate the employee's employment at will at any time, for
any reason, with or without cause, or to decrease the employee's compensation or
benefits,  or (ii) confer upon any person engaged by an Employer any right to be
retained or employed by the Employer or to the continuation,  extension, renewal
or  modification  of any  compensation,  contract or arrangement  with or by the
Employer.

         14. Rights as a Shareholder.  The recipient of any award under the Plan
shall have no rights as a shareholder with respect to any shares of Common Stock
until the date the  recipient  becomes  the  holder  of record of those  shares.
Except as otherwise  expressly provided in the Plan, no adjustment shall be made
for  dividends or other rights for which the record date occurs  before the date
the recipient becomes the holder of record.

                            (Signature page follows)



                                       10
<PAGE>



         The  undersigned,  who is the duly  elected  Secretary  of the Company,
hereby certifies that, following adoption of this Plan by the Board of Directors
of the Company on December 1, 2001. This Plan is not expected to be submitted to
the Shareholders of the company for approval.

                                ARKONA, INC.


                                By: /s/ Steve Russo
                                   ---------------------
                                    Steve Russo
                                    Secretary




                                       11
<PAGE>