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                                                                    EXHIBIT 10.3


                    MODUS MEDIA INTERNATIONAL HOLDINGS, INC.

                           1997 Stock Incentive Plan
                           -------------------------


1.  Purpose
    -------

    The purpose of this 1997 Stock Incentive Plan (the "Plan") of Modus Media
International Holdings, Inc., is to advance the interests of the Company's
stockholders by enhancing the Company's ability to attract, retain and motivate
persons who make (or are expected to make) important contributions to the
Company by providing such persons with equity ownership opportunities and
performance-based incentives and thereby better aligning the interests of such
persons with those of the Company's stockholders.  Except where the context
otherwise requires, the term "Company" shall include any present or future
subsidiary corporations of Modus Media International Holdings, Inc. as defined
in Section 424(f) of the Internal Revenue Code of 1986, as amended, and as
further amended from time to time, and any regulations promulgated thereunder
(the "Code") (a "Subsidiary").

2.  Eligibility
    -----------

    All of the employees, officers, directors, consultants and advisors of the
Company are eligible to be granted options, restricted stock, or other stock-
based awards (each, an "Award") under the Plan.  Any person who has been granted
an Award under the Plan shall be deemed a "Participant".

3.  Administration, Delegation
    --------------------------

    a.   Administration by Board of Directors. The Plan will be administered by
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the Board of Directors of the Company (the "Board"). The Board shall have
authority to grant Awards and to adopt, amend and repeal such administrative
rules, guidelines and practices relating to the Plan as it shall deem advisable
from time to time, to interpret and correct the provisions of the Plan and any
Award. No member of the Board shall be liable for any action or determination
relating to the Plan. All decisions by the Board shall be made in their sole
discretion and shall be final and binding on all persons having or claiming any
interest in the Plan or in any Award.

    b.   Delegation to Executive Officers. To the extent permitted by applicable
         --------------------------------
law, the Board may delegate to one or more executive officers of the Company the
power to make Awards and exercise such other powers under the Plan as the Board
may determine, provided that the Board shall fix the maximum number of shares
subject to Awards and the maximum number of shares for any one Participant to be
made by such executive officers.
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    c.   Appointment of Committees.  To the extent permitted by applicable law,
         -------------------------
the Board may delegate any or all of its powers under the Plan to one or more
committees or subcommittees of the Board (a "Committee"). If and when the Class
A Common Stock, $.01 par value per share, of the Company (the "Common Stock") is
registered under the Securities Exchange Act of 1934, as amended (the "Exchange
Act"), the Board shall appoint one such Committee of not less than two members,
each member of which shall be an "outside director" within the meaning of
Section 162(m) of the Code and a "non-employee director" as defined in Rule 16b-
3 promulgated under the Exchange Act. All references in the Plan to the "Board"
shall mean a Committee or the Board or the executive officer referred to in
Section 3(b) to the extent of such delegation.

4.  Stock Available for Awards
    --------------------------

    a.   Number of Shares. Subject to adjustment under Section 4(c), Awards may
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be made under the Plan for up to 1,800,000 shares of Common Stock. If any Award
expires or is terminated, surrendered or canceled without having been fully
exercised or is forfeited in whole or in part or results in any Common Stock not
being issued, the unused Common Stock covered by such Award shall again be
available for the grant of Awards under the Plan, subject, however, in the case
of Incentive Stock Options (as defined hereinafter) to any limitation required
under the Code. Shares issued under the Plan may consist in whole or in part of
authorized but unissued shares or treasury shares.

    b.   Per-Participant Limit. Subject to adjustment under Section 4(c), for
         ---------------------
Awards granted after the Common Stock is registered under the Exchange Act, the
maximum number of shares with respect to which an Award may be granted to any
Participant under the Plan shall be 900,000 per calendar year. The per-
Participant limit described in this Section 4(b) shall be construed and applied
consistently with Section 162(m) of the Code.

    c.   Adjustment to Common Stock. In the event of any stock split, stock
         --------------------------
dividend, recapitalization, combination of shares, liquidation, spin-off, or
other similar change in capitalization or event, or any distribution to holders
of Common Stock other than a normal cash dividend, (i) the number and class of
securities available under this Plan, (ii) the number and class of security and
exercise price per share subject to each outstanding Option, (iii) the
repurchase price per security subject to each outstanding Restricted Stock Award
(as defined hereinafter), and (iv) the terms of each other outstanding stock-
based Award shall be appropriately adjusted by the Company (or substituted
Awards may be made, if applicable) to the extent the Board shall determine, in
good faith, that such an adjustment (or substitution) is necessary and
appropriate.

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5.      Stock Options
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        a.   General. The Board may grant options to purchase Common Stock
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(each, an "Option") and determine the number of shares of Common Stock to be
covered by each Option, the exercise price of each Option and the conditions and
limitations applicable to the exercise of each Option, including conditions
relating to applicable federal or state securities laws, as it considers
necessary or advisable. An Option which is not intended to be an Incentive Stock
Option (as hereinafter defined) shall be designated a "Nonstatutory Stock
Option".

        b.   Incentive Stock Options. An Option that the Board intends to be an
             -----------------------
"incentive stock option" as defined in Section 422 of the Code (an "Incentive
Stock Option") shall only be granted to employees of the Company and shall be
subject to and shall be construed consistently with the requirements of Section
422 of the Code. The Company shall have no liability to a Participant, or any
other party, if an Option (or any part thereof) which is intended to be an
Incentive Stock Option is not an Incentive Stock Option.

        c.   Exercise Price. The Board shall establish the exercise price at the
             --------------
time each Option is granted and specify it in the applicable option agreement.

        d.   Duration of Options. Each Option shall be exercisable at such times
             -------------------
and subject to such terms and conditions as the Board may specify in the
applicable option agreement.

        e.   Exercise of Option. Options may be exercised only by delivery to
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the Company of a written notice of exercise signed by the proper person together
with payment in full as specified in Section 5(f) for the number of shares for
which the Option is exercised.

        f.   Payment Upon Exercise. Common Stock purchased upon the exercise of
             ---------------------
an Option granted under the Plan shall be paid for as follows:

             (i)   in cash or by check, payable to the order of the Company;

             (ii)  except as the Board may otherwise provide in an Option,
delivery of an irrevocable and unconditional undertaking by a credit worthy
broker to deliver promptly to the Company sufficient funds to pay the exercise
price, or delivery by the Participant to the Company of a copy of irrevocable
and unconditional instructions to a credit worthy broker to deliver promptly to
the Company cash or a check sufficient to pay the exercise price;

             (iii) to the extent permitted by the Board and explicitly provided
in the Option (x) by delivery of shares of Common Stock owned by the Participant

                                      -3-
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valued at their fair market value as determined by the Board in good faith
("Fair Market Value"), which Common Stock was owned by the Participant at least
six months prior to such delivery, (y) by delivery of a promissory note of the
Participant to the Company on terms determined by the Board (and payment to the
Company by the Participant of cash in an amount equal to the par value of the
shares purchased), or (z) payment of such other lawful consideration as the
Board may determine; or

             (iv)  any combination of the above permitted forms of payment.

6.      Restricted Stock
        ----------------

        a.   Grants. The Board may grant Awards entitling recipients to acquire
             ------
shares of Common Stock, subject to (i) payment to the Company by the Participant
of cash in an amount equal to the par value of the shares purchased, and (ii)
the right of the Company to repurchase all or part of such shares at their issue
price or other stated or formula price (or to require forfeiture of such shares
if issued in an amount equal only to the par value of the shares purchased) from
the recipient in the event that conditions specified by the Board in the
applicable Award are not satisfied prior to the end of the applicable
restriction period or periods established by the Board for such Award (each,
"Restricted Stock Award").

        b.   Terms and Conditions. The Board shall determine the terms and
             --------------------
conditions of any such Restricted Stock Award, including the conditions for
repurchase (or forfeiture) and the issue price, if any. Any stock certificates
issued in respect of a Restricted Stock Award shall be registered in the name of
the Participant and, unless otherwise determined by the Board, deposited by the
Participant, together with a stock power endorsed in blank, with the Company (or
its designee). At the expiration of the applicable restriction periods, the
Company (or such designee) shall deliver the certificates no longer subject to
such restrictions to the Participant or if the Participant has died, to the
beneficiary designated by a Participant, in a manner determined by the Board, to
receive amounts due or exercise rights of the Participant in the event of the
Participant's death (the "Designated Beneficiary"). In the absence of an
effective designation by a Participant, Designated Beneficiary shall mean the
Participant's estate.

7.      Other Stock-Based Awards
        ------------------------

        The Board shall have the right to grant other Awards based upon the
Common Stock having such terms and conditions as the Board may determine,
including the grant of shares based upon certain conditions, the grant of
securities convertible into Common Stock and the grant of stock appreciation
rights.

                                      -4-
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8.      General Provisions Applicable to Awards
        ---------------------------------------

        a.   Transferability of Awards. Except as the Board may otherwise
             -------------------------
determine or provide in an Award, Awards shall not be sold, assigned,
transferred, pledged or otherwise encumbered by the person to whom they are
granted, either voluntarily or by operation of law, except by will or the laws
of descent and distribution, and, during the life of the Participant, shall be
exercisable only by the Participant. References to Participant, to the extent
relevant in the context, shall include references to authorized transferees.

        b.   Documentation. Each Award under the Plan shall be evidenced by a
             -------------
written instrument in such form as the Board shall determine. Each Award may
contain terms and conditions in addition to those set forth in the Plan.

        c.   Board Discretion. Except as otherwise provided by the Plan, each
             ----------------
type of Award may be made alone, in addition to or in relation to any other type
of Award. The terms of each type of Award need not be identical, and the Board
need not treat Participants uniformly.

        d.   Termination of Status. The Board shall determine the effect on an
             ---------------------
Award of the disability, death, retirement, authorized leave of absence or other
change in the employment or other status of a Participant and the extent to
which, and the period during which, the Participant, the Participant's legal
representative, conservator, guardian or Designated Beneficiary may exercise
rights under the Award.

        e.   Acquisition Events
             ------------------

             (i)   Consequences of Acquisition Events. Upon the occurrence of an
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Acquisition Event (as defined below), (a) each outstanding Option or Award shall
be assumed or an equivalent option or award shall be substituted by the
successor corporation or a parent or subsidiary of the successor corporation
(unless the successor corporation refuses to assume or substitute for the Option
or Award), provided that any such Options substituted for Incentive Stock
Options shall satisfy, in the determination of the Board, the requirements of
Section 424(a) of the Code, and (b) (x) all Options then outstanding shall
become immediately exercisable in full immediately prior to the effectiveness of
the Acquisition Event and, unless assumed or substituted by the successor
corporation, will terminate, to the extent unexercised, upon the consummation of
such Acquisition Event; (y) all Restricted Stock Awards then outstanding shall
become immediately free of all restrictions upon the consummation of the
Acquisition Event; and (z) all other stock-based Awards shall become immediately
exercisable, realizable or vested in full, or shall be immediately free of all
restrictions or conditions, as the case may be, upon the consummation of the
Acquisition Event.

                                      -5-
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         An "Acquisition Event" shall mean: (x) any merger or consolidation
which results in the voting securities of the Company outstanding immediately
prior thereto continuing to represent (either by remaining outstanding or by
being converted into voting securities of the surviving or acquiring entity or
its parent) less than 50% of the combined voting power of the voting securities
of the Company or such surviving or acquiring entity or its parent outstanding
immediately after such merger or consolidation; (y) any sale of all or
substantially all of the assets of the Company; or (z) the complete liquidation
of the Company.

         (ii)  Assumption of Options Upon Certain Events. The Board may grant
               -----------------------------------------
Awards under the Plan in substitution for stock and stock-based awards held by
employees of another corporation who become employees of the Company as a result
of a merger or consolidation of the employing corporation with the Company or
the acquisition by the Company of property or stock of the employing
corporation. The substitute Awards shall be granted on such terms and conditions
as the Board considers appropriate in the circumstances.

     f.  Withholding. Each Participant shall pay to the Company, or make
         -----------
provisions satisfactory to the Board for payment of, any taxes required by law
to be withheld in connection with Awards to such Participant no later than the
date of the event creating the tax liability. The Board may allow Participants
to satisfy such tax obligations in whole or in part in shares of Common Stock,
including shares retained from the Award creating the tax obligation, valued at
their Fair Market Value. The Company may, to the extent permitted by law, deduct
any such tax obligations from any payment of any kind otherwise due to a
Participant.

     g.  Amendment of Award. The Board may amend, modify or terminate any
         ------------------
outstanding Award, including but not limited to, substituting therefor another
Award of the same or a different type, changing the date of exercise or
realization, and converting an Incentive Stock Option to a Nonstatutory Stock
Option, provided that the Participant's consent to such action shall be required
unless the Board determines that the action, taking into account any related
action, would not materially and adversely affect the Participant.

     h.  Conditions on Delivery of Stock. The Company will not be obligated to
         -------------------------------
deliver any shares of Common Stock pursuant to the Plan or to remove
restrictions from shares previously delivered under the Plan until (i) all
conditions of the Award have been met or removed to the satisfaction of the
Company, (ii) in the opinion of the Company's counsel, all other legal matters
in connection with the issuance and delivery of such shares have been satisfied,
including any applicable securities laws and any applicable stock exchange or
stock market rules and regulations, and (iii) the Participant has executed and
delivered to the Company such representations or agreements as the Company may
consider appropriate to satisfy the requirements of any applicable laws, rules
or regulations.

                                      -6-
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     i.  Acceleration. The Board may at any time provide that any Options shall
         ------------
become immediately exercisable in full or in part, that any Restricted Stock
Awards shall be free of all restrictions, or that any other stock-based Awards
may become exercisable in full or in part or free of some or all restrictions or
conditions, or otherwise realizable in full or in part, as the case may be,
despite the fact that foregoing options may (i) cause the application of
Sections 280G and 4999 of the Code if a change in control of the Company occurs,
and (ii) disqualify all or part of the Option as an incentive stock option.

9.   Miscellaneous
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     a.  No Right To Employment or Other Status. No person shall have any claim
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or right to be granted an Award, and the grant of an Award shall not be
construed as giving a Participant the right to continued employment or any other
relationship with the Company. The Company expressly reserves the right at any
time to dismiss or otherwise terminate its relationship with a Participant free
from any liability or claim under the Plan, except as expressly provided in the
applicable Award.

     b.  No Rights As Stockholder. Subject to the provisions of the applicable
         ------------------------
Award, no Participant or Designated Beneficiary shall have any rights as a
stockholder with respect to any shares of Common Stock to be distributed with
respect to an Award until becoming the record holder thereof.

     c.  Effective Date and Term of Plan. The Plan shall become effective on the
         -------------------------------
date on which it is adopted by the Board, but no Award granted to a Participant
designated as subject to Section 162(m) by the Board shall become exercisable,
vested or realizable, as applicable to such Award, unless and until the Plan has
been approved by the Company's stockholders. No Awards shall be granted under
the Plan after the completion of ten years from the earlier of (i) the date on
which the Plan was adopted by the Board or (ii) the date the Plan was approved
by the Company's stockholders, but Awards previously granted may extend beyond
that date.

     d.  Amendment of Plan. The Board may amend, suspend or terminate the Plan
         -----------------
or any portion thereof at any time, provided that no Award granted to a
Participant designated as subject to Section 162(m) by the Board after the date
of such amendment shall become exercisable, realizable or vested, as applicable
to such Award (to the extent that such amendment to the Plan was required to
grant such Award to a particular Participant), unless and until such amendment
shall have been approved by the Company's stockholders.

                                      -7-
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     e.  Stockholder Approval. For purposes of this Plan, stockholder approval
         --------------------
shall mean approval by a vote of the stockholders in accordance with the
requirements of Section 162(m) of the Code.

     f.  Governing Law. The provisions of the Plan and all Awards made hereunder
         -------------
shall be governed by and interpreted in accordance with the laws of the State of
Delaware, without regard to any applicable conflicts of law.



                                       Adopted by the Board of Directors on
                                       December 15, 1997


                                       Approved by the stockholders on
                                       December 15, 1997

                                      -8-
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                   MODUS MEDIA INTERNATIONAL HOLDINGS, INC.

                                Amendment No. 1

                                      to

                           1997 Stock Incentive Plan
                           -------------------------


     Section 8(e)(i) of the 1997 Stock Incentive Plan of Modus Media
International Holdings, Inc. is hereby restated in its entirety as follows:

          "(i)  Consequences of Acquisition.  In the event of an Acquisition
                ---------------------------
     Event (as defined below), the Board of Directors of the Company, or the
     board of directors of any corporation assuming the obligations of the
     Company, may, in its discretion, take any one or more of the following
     actions as to outstanding Awards:  (i) provide that such Awards shall be
     assumed, or substantially equivalent Awards shall be substituted, by the
     acquiring or succeeding corporation (or an affiliate thereof) on such terms
     as the Board determines to be appropriate, (ii) upon written notice to
     Participants, provide that all unexercised Options or other Awards will
     terminate immediately prior to the consummation of such transaction unless
     exercised by the Participant within a specified period following the date
     of such notice, (iii) in the event of an Acquisition Event under the terms
     of which holders of the Common Stock of the Company will receive upon
     consummation thereof a cash payment for each share surrendered in the
     Acquisition Event (the "Acquisition Price"), make or provide for a cash
     payment to Participants equal to the difference between (A) the Acquisition
     Price times the number of shares of Common Stock subject to outstanding
     Options or other Awards (to the extent then exercisable at prices not in
     excess of the Acquisition Price) and (B) the aggregate exercise price of
     all such outstanding Options or other Awards, in exchange for the
     termination of such Options and other Awards, (iv) provide that all
     Restricted Stock Awards then outstanding shall become immediately free of
     all restrictions upon the consummation of the Acquisition Event, and (v)
     provide that all or any outstanding Awards shall become exercisable or
     realizable in full prior to the effective date of such Acquisition Event.

          An "Acquisition Event" shall mean: (x) any merger or consolidation
     which results in the voting securities of the Company outstanding
     immediately prior thereto continuing to represent (either by remaining
     outstanding or by being converted into voting securities of the surviving
     or acquiring entity or its parent) less than 50% of the combined voting
     power of the voting securities of the Company or such surviving or
     acquiring entity or its parent outstanding
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     immediately after such merger or consolidation; (y) any sale of all or
     substantially all of the assets of the Company; or (z) the complete
     liquidation of the Company."

                                         Adopted by the Board of Directors
                                         on April 17, 1998