Exhibit 10.16

                            THE PATHWAYS GROUP, INC.

                           DIRECTORS STOCK OPTION PLAN

            1. Purpose. The purpose of the Directors Stock Option Plan (the
"Plan") is to aid the Company in attracting, retaining and motivating directors
by providing them with incentives for making significant contributions to the
growth and profitability of the Company. The Plan is designed to accomplish this
goal by the granting of stock options, thereby providing Participants with a
proprietary interest in the growth, profitability and success of the Company.

            2. Definitions.

            (a) Board. The Board of Directors of the Company.

            (b) Code. The Internal Revenue Code of 1986, as amended from time to
time.

            (c) Committee. The members of the Board who are not eligible to
participate in the Plan, or a committee composed of such members (consisting of
not less than two persons) as may be designated from time to time by all such
members, who shall administer the Plan.

            (d) Company. The Pathways Group, Inc.

            (e) Fair Market Value. If the Stock is listed on the New York Stock
Exchange (or other national exchange), the average of the high and low sale
prices as reported on the New York Stock Exchange (or such other exchange) or,
if the Stock is not listed on a national exchange, the average of the high and
low sale prices of the Stock in the over-the-counter market, as reported by the
National Association of Securities Dealers through its Automated Quotation
System or otherwise, in either case for the date in question, provided that if
no transactions in the Stock are reported for that date, the average of the high
and low sale prices as so reported for the preceding day on which transactions
in the Stock were effected.

            (f) Non-Employee Directors. Directors of the Company who are not
officers or employees of the Company or any direct or indirect subsidiary of the
Company.

            (g) Option. A non-qualified stock option to purchase shares of Stock
granted pursuant to the terms and conditions of the Plan.

            (h) Option Agreement. An agreement between the Company and a
Participant setting forth the terms, conditions and limitations applicable to an
Option.

            (i) Participant. A director of the Company to whom an Option has
been granted.

            (j) Stock. Authorized and issued or unissued shares of Common Stock
of the Company or any security issued in exchange or substitution therefor.

            3. Eligibility. Only the following persons are eligible to
participate in the Plan: Non- Employee Directors who (i) have not been
designated by the Board within 30 days after becoming a director as being
eligible to receive Awards under the Amended and Restated Stock Incentive Plan,
or (ii) having been eligible to participate in the Amended and Restated Stock
Incentive Plan, have ceased to be so eligible as a result of a determination by
the Board. The eligibility of any such director to partici pate in the Plan
shall cease if such director is subsequently designated as being eligible to
receive
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Awards (as defined in the Amended and Restated Stock Incentive Plan) under the
Amended and Restated Stock Incentive Plan.

            4. Stock Available for Options. Subject to Section 8 hereof, a total
of 100,000 shares of Stock shall be available for issuance pursuant to options
granted under the Plan. From time to time, the Board and appropriate officers of
the Company shall file such documents with governmental authorities and, if the
Stock is listed on the New York Stock Exchange (or other national exchange),
with such stock exchange, as are required to make shares of Stock available for
issuance pursuant to Options and publicly tradeable. Shares of Stock related to
Options, or portions of Options, that are forfeited, canceled or terminated,
expire unexercised, are surrendered in exchange for other Options, or in such
manner that all or some of the shares covered by an Option are not and will not
be issued to a Participant, shall be restored to the total number of shares of
Stock available for issuance pursuant to Options.

            5. Administration. The Plan shall be administered by the Committee,
which shall have full and exclusive power to (a) construe and interpret the Plan
and all Option Agreements, (b) adopt and amend such rules, procedures,
regulations and guidelines for carrying out the Plan as it may deem necessary or
desirable and (c) take any other action necessary for the proper operation and
administration of the Plan, all of which powers shall be exercised in a manner
consistent with the objectives, and in accordance with the terms and conditions,
of the Plan; provided, however, that no discretion regarding the grant, amount,
timing, terms and conditions of Options granted under the Plan (which are
established by the Plan), shall be afforded to the Committee. All actions of the
Committee with respect to the Plan shall require the vote of a majority of its
members or, if there are only two members, by the vote of both. Any action of
the Committee may be taken by a written instrument signed by a majority (or
both) of such members and any action so taken shall be as effective as if it had
been taken by a vote of such members at a meeting. All determinations and acts
of the Committee as to any matters concerning the Plan, including
interpretations or constructions of the Plan and any Award Agreement, shall be
conclusive and binding on all Participants and on any parties validly claiming
through any Participants.

            6. Granting of Options.

            (a) On the date the Plan becomes effective, each director who at
such date is eligible to participate in the Plan shall automatically be granted
an Option to purchase 10,000 shares of Stock.

            (b) On the date that any Non-Employee Director (other than a
director who received a grant pursuant to subparagraph (a) of this Section 6)
first becomes eligible to participate in the Plan, such Non-Employee Director
shall automatically be granted an Option to purchase 10,000 shares of Stock.

            (c) Commencing on the date of the Annual Meeting of Stockholders of
the Company (i) on or next preceding the second anniversary of the date on which
a Participant becomes eligible to participate in the Plan, in the case of a
Participant who is granted an Option pursuant to subparagraph (b) of this
Section 6, or (ii) on or next preceding the first anniversary of the date on
which a Non-Employee Director becomes eligible to participate in the Plan, in
the case of a Non-Employee Director who is not granted an Option pursuant to
subparagraph (b) of this Section 6, and, in each case, on the date of each
succeeding Annual Meeting of Stockholders, any such Participant, if remaining a
director and eligible to participate in the Plan, shall automatically be granted
an Option to purchase 5,000 shares of Stock.

            (d) Notwithstanding the foregoing, no Option shall be granted to any
person whose service as a director ends at the Annual Meeting of Stockholders on
the date of which the Option would otherwise be granted.


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            (e) The number of shares of Stock for which Options shall be granted
under this Section 6 is subject to adjustment as set forth in Section 7(l)
hereof.

            7. Options. Each Option granted pursuant to, or otherwise to be
governed by the terms and conditions of, the Plan shall have the following terms
and conditions:

            (a) Each Option shall have an exercise price equal to the Fair
      Market Value of a share of Stock on the date of grant.

            (b) The price at which shares of Stock may be purchased upon
      exercise of an Option shall be paid in full at the time of exercise, in
      cash or by (i) tendering Stock or surrendering another stock option,
      valued at, or on the basis of, the Fair Market Value of the Stock on the
      date of exercise, (ii) delivery of a promissory note issued by a
      Participant to the Company in a form determined by the Committee, or (iii)
      other means acceptable to the Committee. The Committee shall determine
      acceptable methods for tendering Stock or surren dering other stock
      options. Participants may also exercise Options and simultaneously sell
      some or all of the shares of Stock so acquired pursuant to a brokerage or
      similar arrangement which provides for the payment of the Option exercise
      price substantially concurrently with the delivery of such shares.

            (c) Each Option shall be exercisable for a period of ten years from
      the date of grant.

            (d) Each Option shall be exercisable as to one-third of the shares
      of Stock subject to such Option on and after the first anniversary of the
      date of grant of such Option, as to an additional one-third, on and after
      the second anniversary thereof, and as to the remaining one-third, on and
      after the third anniversary thereof.

            (e) The Company shall have the right to deduct applicable taxes
      resulting from any exercise of or other payment on an Option and to
      withhold an appropriate number of shares of Stock for payment of tax
      withholding obligations, if any, or to take such other action as may be
      necessary in the opinion of the Company to satisfy any tax withholding
      obligations. In addition, Participants may elect to (i) have the Company
      deduct applicable taxes by withholding an appropriate number of shares of
      Stock for payment of taxes required by law or (ii) tender to the Company
      for the purpose of satisfying tax payment obligations other Stock held by
      the Par ticipant. If the Company withholds shares of Stock to satisfy tax
      payment obligations, the value of such Stock shall be its Fair Market
      Value on the date the Option is exercised. If a Participant tenders shares
      of Stock pursuant to clause (ii) above to satisfy tax payment obligations,
      the value of such Stock shall be the Fair Market Value on the date the
      Participant tenders such Stock to the Company.

            (f) Except as otherwise set forth in the applicable Option Agreement
      or as other wise provided in paragraphs (g), (h), (i) and (j) of this
      Section 7, if a Participant's association with the Company terminates, any
      unexercised Option (or portion thereof) shall, to the extent it is ex
      ercisable pursuant to the terms of such Option on the date of such
      termination, remain exercis able for a period of three months following
      the date of termination or until the stated expiration date of the Option,
      if earlier.

            (g) If a Participant dies, any outstanding Option then held by the
      Participant shall become fully exercisable as of the date of the
      Participant's death. Any such Option shall be exercisable by the
      Participant's estate or beneficiaries following the Participant's death
      through the expiration date specified in the applicable Option Agreement
      and in such manner as if the Participant were living. Rights with respect
      to any such Option shall pass in the following order: (i) to beneficiaries
      so designated in writing by the Participant; or if none, then (ii) to the


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      Participant's legal representatives; or if none, then (iii) to the persons
      entitled thereto as determined by a court of competent jurisdiction.

            (h) If a Participant ceases to be associated with the Company
      because the Participant is deemed by the Company to be disabled, any
      Option held by the Participant may be exercised by the Participant, if
      legally competent, or by a committee or other legally designated guardian
      or representative if the Participant is legally incompetent, through the
      expiration date specified in the applicable Option Agreement. Any such
      Option shall become fully exercisable as of the date of the Participant's
      termination of his or her association with the Company by virtue of such
      disability.

            (i) If a Participant's association with the Company terminates in
      order that such Participant may assume a position with a governmental,
      charitable or educational agency or institution, such Participant's
      Options, to the extent permitted by law, shall continue in effect and be
      exercisable beyond the date of termination, up until the expiration date
      specified in the applicable Option Agreement. Any such Option shall become
      fully exercisable as of the date of the Participant's termination. To the
      extent permitted by law, the Participant may authorize a third party
      (including, without limitation, the trustee of a "blind" trust),
      acceptable to the appli cable authorities, the Participant and the
      Committee, to act on behalf of the Participant with respect to such
      Options.

            (j) If a Participant's association with the Company terminates by
      reason of the Participant's retirement at 62 years of age or thereafter,
      any outstanding Option then held by the Participant shall become fully
      exercisable as of the date of the Participant's retirement. Any such
      Option shall be exercisable through the expiration date specified in the
      applicable Option Agreement.

            (k) An Option shall not be assignable or transferable to, or
      exercisable by, anyone other than the Participant to whom it is granted,
      except as provided in subparagraphs (g), (h), (i) and (j) of this Section
      7.

            (l) In the event of any change in the number of shares of
      outstanding Stock by reason of a stock split, stock dividend, combination
      or reclassification of shares, recapitalization, merger, consolidation or
      similar event, the Committee shall adjust proportionally the number of
      shares of Stock covered by each outstanding Option and the exercise price
      thereof. In the event of any other change affecting the Stock or any
      distribution (other than normal cash dividends) to holders of Stock, such
      adjustments as may be deemed equitable by the Committee, including
      adjustments to avoid fractional shares, shall be made to give proper
      effect to such event.

            (m) Notwithstanding the provisions of paragraph (d) of this Section
      7, Options shall be subject to acceleration of exercisability in the event
      of a Change in Control of the Company, as provided in agreements between
      the Company and certain of its officers and directors which provide for
      certain protections and benefits in the event of a Change in Control (as
      defined in such agreements), or as shall be provided in applicable Option
      Agreements. "Change in Control" for purposes of the Plan and any Options
      shall mean a change in control of the Company under such circumstances as
      shall be specified (i) where applicable to any Options by any such
      agreement between the Company and a Participant as (A) may have been
      entered into prior to the effective date of the Plan or (B) shall be
      entered into after the effective date of the Plan upon such terms and
      conditions, to the extent applicable to any Options, as are substantially
      the same as those contained in earlier prior agreements with certain
      officers and directors, or (ii) in the applicable Option Agreement. For
      the purposes of the Plan or any Option, a "Change in Control" may, without
      limitation, be deemed to have occurred if (U) a change in control of the
      Company of a nature that would be required to be reported in response to
      Item 6(e) of Schedule 14A of Regulation 14A under the Exchange Act occurs;
      (V) any "person" or


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      "group" of persons (as the terms "person" and "group" are used in Section
      13(d) and 14(d) of the Exchange Act and the rules thereunder) is or
      becomes the beneficial owner, directly or indirectly, of securities of the
      Company representing 30% or more of the combined voting power of the then
      outstanding securities of the Company; (W) the Company consummates a
      merger, consolidation, share exchange, division or other reorganization of
      the Company with any other corporation or entity, unless the stockholders
      of the Company immediately prior to such transaction beneficially own,
      directly or indirectly, (1) if the Company is the surviving corporation in
      such transaction, 60% or more of the combined voting power of the
      Company's outstanding voting securities as well as 60% or more of the
      total market value of the Company's outstanding equity securities, (2) if
      the Company is not the surviving corporation, 80% or more of the combined
      voting power of the surviving entity's outstanding voting securities as
      well as 80% or more of the total market value of such entity's outstanding
      equity securities, or (3) in the case of a division, 80% or more of the
      combined voting power of the outstanding voting securities of each entity
      resulting from the division as well as 80% or more of the total market
      value of each such entity's outstanding equity securities, in each case in
      substantially the same proportion as such stockholders owned shares of the
      Company prior to such transaction; (X) the Company adopts a plan of
      complete liquidation or winding-up of the Company; (Y) the stockholders of
      the Company approve an agreement for the sale or disposition (in one
      transaction or a series of transactions) of all or substantially all of
      the Company's assets; or (Z) a change of more than 25% in the composition
      of the Board occurs within a two-year period unless such change was
      approved in advance by at least two-thirds of the previous directors.

            8. Adjustments. In the event of any change in the outstanding Stock
by reason of a stock split, stock dividend, combination or reclassification of
shares, recapitalization, merger, consolidation or similar event, the Committee
shall adjust proportionally the number of shares of Stock (a) reserved for
issuance pursuant to the Plan and (b) available for Options.

            9. Amendment or Termination. The Committee may amend, modify,
suspend or terminate the Plan for the purpose of (a) meeting or addressing any
changes in any applicable tax, securities or other laws, rules or regulations or
(b) for any other purpose permitted by law. Subject to changes in law or other
legal requirements which would permit otherwise, the Plan may not be amended
without stockholder approval to (i) materially increase the aggregate number of
shares of Stock that may be issued under the Plan (except for any increase
resulting from adjustments pursuant to Section 7(l) or 8 hereof) or (ii)
materially increase the benefits accruing to Participants or (iii) materially
modify the requirements as to eligibility for participation in the Plan.
Further, the Plan may not be amended in a manner that would alter, impair,
amend, modify, suspend or terminate any rights of a Participant or obligation of
the Company under any Options theretofore granted, in any manner adverse to such
affected Participant, without the consent of such affected Participant.

            10. Notice. Any written notice to the Company required by any of the
provisions of the Plan shall be addressed to the Committee, c/o the Secretary of
the Company, and shall become effective when received by the Secretary.

            11. Governing Law. The Plan and all determinations made and actions
taken pursuant hereto, to the extent not otherwise governed by the Code or the
securities laws of the United States, shall be governed by and construed under
the laws of the State of Delaware.

            12. Effective and Termination Dates. The Plan, and any amendment
hereof requiring stockholder approval, shall become effective as of the date of
its approval by the stockholders of the Company by the affirmative vote of a
majority of the votes cast at a stockholders' meeting at which the approval of
the Plan (or any such amendment) is considered, provided that the total vote
cast represents over 50% of all shares entitled to vote on the proposal. The
Plan shall terminate ten years after its initial effective date, subject to
earlier termination by the Board pursuant to Section 9 hereof, except as to
Options then outstanding.


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