<PAGE>



                                                                    EXHIBIT 10.3


                             OCTOBER 2001 AMENDMENT
                                     TO THE
                                FAIRMARKET, INC.
                   AMENDED AND RESTATED 1997 STOCK OPTION PLAN

         This October 2001 Amendment to the FairMarket, Inc. Amended and
Restated 1997 Stock Option Plan (the "Plan") is effective as of October 11,
2001. All capitalized terms used but not defined herein shall have the meanings
specified in the Plan.

1.       AMENDMENT TO THE PLAN.  Section 8(b) of the Plan is hereby amended in
its entirety to read as follows:

                  "(b) In the case of (i) the dissolution or liquidation of the
         Company, (ii) a merger, reorganization or consolidation in which a
         majority of the outstanding voting power of the Company is acquired by
         another person or entity (other than a holding company formed by the
         Company), (iii) the sale of all or substantially all of the assets of
         the Company to an unrelated person or entity, or (iv) the sale of all
         of the Common Stock of the Company to an unrelated person or entity (in
         each case, a "Transaction"), fifty percent (50%) of the outstanding
         Options held by any Optionee which have not yet vested shall become
         fully vested and exercisable as of the closing or consummation of such
         Transaction (except as the Board may otherwise specify with respect to
         particular grants), provided that such acceleration and any notice of
         exercise of options that become vested as of such closing or
         consummation shall in all cases be subject to and contingent upon such
         closing or consummation, and provided, further, that such acceleration
         shall be applied to each tranche of Options held by an Optionee on a
         separate basis.* The Plan and the options issued hereunder shall
         terminate upon the effectiveness of any such Transaction, unless
         provision is made in connection with such transaction in the sole
         discretion of the parties thereto for the assumption of options
         theretofore granted, or the substitution for such options of new
         options of the successor entity or a parent or subsidiary thereof, with
         such adjustment as to the number and kind of shares and the per share
         exercise prices as such parties shall agree. In the case of a
         Transaction whereby the outstanding Options are not to be assumed or
         substituted by the successor entity or a parent or subsidiary thereof,
         all outstanding Options that are not vested and exercisable immediately
         prior to the consummation of the Transaction shall become fully vested
         and exercisable

--------
*     For example, if an Optionee held an option to acquire 300 shares which was
      scheduled to vest with respect to 150 option shares on Date Y and with
      respect to the remaining 150 option shares on Date Z, then if a Sale Event
      is consummated on Date X (which Date X precedes both Date Y and Date Z),
      then on Date X 150 option shares become vested (i.e., 50% of the option
      shares that were to vest on Date Y and 50% of the option shares that were
      to vest on Date Z), on Date Y 75 option shares will become vested and on
      Date Z 75 option shares will become vested.


<PAGE>



          immediately prior to the consummation of the Transaction, provided
          that such acceleration and any notice of exercise of options that
          become vested immediately prior to such consummation shall in all
          cases be subject to and contingent upon such consummation. In the
          event of any Transaction subject to this Section 8(b), each Optionee
          shall be given notice thereof at least fifteen (15) days prior to the
          closing or anticipated consummation date, or the record date for such
          transaction, if earlier, and each Optionee shall be permitted during
          such period to exercise all outstanding Options held by such Optionee,
          including those that will become vested and exercisable upon the
          consummation of the Transaction subject to the consummation of the
          Transaction."

2.        STATUS OF PLAN. Except as specifically amended hereby, the Plan shall
continue in full force and effect. From and after the date hereof, all
references in any agreements covering awards granted under the Plan shall be
deemed to be references to the Plan as hereby amended.