<PAGE>
                                                                   EXHIBIT 10.10

                               Asta Funding, Inc.
                           Form 10-QSB March 31, 2002
                                  Exhibit 10.10

                               ASTA FUNDING, INC.

                             2002 STOCK OPTION PLAN


<PAGE>

                                TABLE OF CONTENTS

                                                                            Page
                                                                            ----


1.  PURPOSE...................................................................16

2.  DEFINITIONS...............................................................16

3.  ADMINISTRATION............................................................20

4.  STOCK SUBJECT TO THE PLAN.................................................21

5.  OPTION GRANTS FOR ELIGIBLE INDIVIDUALS....................................22

6.  TERMS AND CONDITIONS APPLICABLE TO ALL OPTIONS............................22

7.  EFFECT OF A TERMINATION OF EMPLOYMENT.....................................24

8.  ADJUSTMENT UPON CHANGES IN CAPITALIZATION.................................24

9.  INTERPRETATION............................................................25

10. TERMINATION AND AMENDMENT OF THE PLAN.....................................25

11. NON-EXCLUSIVITY OF THE PLAN...............................................25

12. LIMITATION OF LIABILITY...................................................25

13. REGULATIONS AND OTHER APPROVALS; GOVERNING LAW............................26

14. MISCELLANEOUS.............................................................26


<PAGE>

                               ASTA FUNDING, INC.

                             2002 STOCK OPTION PLAN

PURPOSE.

                  The purpose of this Plan is to strengthen Asta Funding, Inc.,
(the "Company") by providing an incentive to its employees, officers, directors,
and consultants and thereby encouraging them to devote their abilities and
industry to the success of the Company's business enterprise. It is intended
that this purpose be achieved by extending to employees, officers, directors,
and consultants of the Company and its Subsidiaries an added long-term incentive
for high levels of performance and unusual efforts through the grant of
Incentive Stock Options and Nonqualified Stock Options, as such terms are
defined herein.

DEFINITIONS.

                  For purposes of the Plan:

         "Affiliate" means any entity that directly or indirectly controls, is
controlled by, or is under common control with the Company or any corporation or
other entity acquiring, directly or indirectly, all or substantially all of the
assets and business of the Company, whether by operation of law or otherwise.

         "Option Agreement" means the written agreement between the Company and
an Optionee evidencing the grant of an Option and setting forth the terms and
conditions thereof.

         "Board" means the Board of Directors of the Company.

         "Cause" means, unless otherwise designated by the Plan Committee and
set forth in the Option Agreement evidencing the grant of an award or Option:
(i) intentional failure to perform reasonably assigned duties to the Company or
any of its Subsidiaries; (ii) dishonesty or willful misconduct in the
performance of such duties; (iii) involvement in a transaction in connection
with the performance of such duties, which transaction is engaged in for
personal profit and is adverse to the interests of the Company or any of its
Subsidiaries; or (iv) willful violation of any law, rule or regulation in
connection with the performance of such duties (other than traffic violations or
similar offenses).

         "Change in Capitalization" means any increase or reduction in the
number of Shares, or any change (including, but not limited to, a change in
value) in the Shares or exchange of Shares for a different number or kind of
shares or other securities of the Company, by reason of a reclassification,
recapitalization, merger, consolidation, reorganization, spin-off, split-up,
issuance of warrants or rights or debentures, stock dividend, stock split or
reverse stock split, cash dividend, property dividend, combination or exchange
of Shares, repurchase of Shares, change in corporate structure, or otherwise.

<PAGE>


         A "Change in Control" means the occurrence during the term of the Plan
of:

         an acquisition (other than directly from the Company) of any voting
         securities of the Company (the "Voting Securities") by any "Person" (as
         the term "Person" is used for purposes of Section 13(d) or 14(d) of the
         Securities Exchange Act of 1934, as amended (the "Exchange Act")),
         immediately after which such Person has "Beneficial Ownership" (within
         the meaning of Rule 13d-3 promulgated under the Exchange Act) of fifty
         percent (50%) or more of the then-outstanding Shares or the combined
         voting power of the Company's then-outstanding Voting Securities;
         provided, however, that in determining whether a Change in Control has
         occurred, Shares or Voting Securities acquired in a "Non-Control
         Acquisition" (as hereinafter defined) shall not constitute an
         acquisition that would cause a Change in Control. A "Non-Control
         Acquisition" shall mean an acquisition by (i) an employee benefit plan
         (or a trust forming a part thereof) maintained by (A) the Company or
         (B) any corporation or other Person if the Company controls such
         Person's voting power by owning, directly or indirectly, the majority
         of its voting equity securities or equity interest (for purposes of
         this definition, a "Subsidiary"); (ii) the Company or its Subsidiaries;
         or (iii) any Person in connection with a "Non-Control Transaction" (as
         hereinafter defined);

         the individuals who, as of the date of adoption of this Plan by the
         shareholders of the Company, are members of the Board (the "Incumbent
         Board"), cease for any reason to constitute a majority of the members
         of the Board; provided, however, that if the election, or nomination
         for election by the Company's common stockholders, of any new director
         was approved by a vote of at least two-thirds of the Incumbent Board,
         such new director shall, for purposes of this Plan, be considered a
         member of the Incumbent Board; provided further, however, that no
         individual shall be considered a member of the Incumbent Board if such
         individual initially assumed office as a result of either an actual or
         threatened "Election Contest" (as described in Rule 14a-11 promulgated
         under the Exchange Act) or other actual or threatened solicitation of
         proxies or consents by or on behalf of a Person other than the Board (a
         "Proxy Contest"), including by reason of any agreement intended to
         avoid or to settle any Election Contest or Proxy Contest; or

         The consummation of:

                  a merger, consolidation or reorganization with or into the
                  Company or in which securities of the Company are issued,
                  unless such merger, consolidation, or reorganization is a
                  "Non-Control Transaction." A "Non-Control Transaction" shall
                  mean a merger, consolidation, or reorganization with or into
                  the Company or in which securities of the Company are issued
                  where:

                           the stockholders of the Company, immediately before
                           such merger, consolidation or reorganization, own
                           directly or indirectly immediately following such
                           merger, consolidation or reorganization, at least
                           fifty percent (50%) of the combined voting power of
                           the outstanding voting securities of the corporation
                           resulting from such merger or consolidation or
                           reorganization (the "Surviving Corporation") in
                           substantially the same proportion as their ownership
                           of the Voting Securities immediately before such
                           merger, consolidation or reorganization,

                           the individuals who were members of the Incumbent
                           Board immediately prior to the execution of the
                           agreement providing for such merger, consolidation or
                           reorganization constitute at least two-thirds of the
                           members of the board of directors of the Surviving
                           Corporation, or a corporation beneficially directly
                           or indirectly owning a majority of the Voting
                           Securities of the Surviving Corporation, and
<PAGE>

                           no Person other than (I) the Company, (II) any
                           Subsidiary, (III) any employee benefit plan (or any
                           trust forming a part thereof) that, immediately prior
                           to such merger, consolidation or reorganization, was
                           maintained by the Company or any Subsidiary, or (IV)
                           any Person who, immediately prior to such merger,
                           consolidation or reorganization had Beneficial
                           Ownership of fifty percent (50%) or more of the
                           then-outstanding Voting Securities or Shares, has
                           Beneficial Ownership of fifty percent (50%) or more
                           of the combined voting power of the Surviving
                           Corporation's then-outstanding voting securities or
                           its common stock;

                  A complete liquidation or dissolution of the Company; or

                  The sale or other disposition of all or substantially all of
                  the assets of the Company to any Person (other than a transfer
                  to a Subsidiary).

         Notwithstanding the foregoing, a Change in Control shall not be deemed
to occur solely because any Person (the "Subject Person") acquired Beneficial
Ownership of more than the permitted amount of the then-outstanding Shares or
Voting Securities as a result of the acquisition of Shares or Voting Securities
by the Company which, by reducing the number of Shares or Voting Securities then
outstanding, increases the proportional number of shares Beneficially Owned by
the Subject Persons, provided that if a Change in Control would occur (but for
the operation of this sentence) as a result of the acquisition of Shares or
Voting Securities by the Company, and after such share acquisition by the
Company, the Subject Person becomes the Beneficial Owner of any additional
Shares or Voting Securities which increases the percentage of the
then-outstanding Shares or Voting Securities Beneficially Owned by the Subject
Person, then a Change in Control shall occur.

         If an Eligible Individual's employment is terminated by the Company
without Cause prior to the date of a Change in Control but the Eligible
Individual reasonably demonstrates that the termination (A) was at the request
of a third party who has indicated an intention or taken steps reasonably
calculated to effect a change in control or (B) otherwise arose in connection
with, or in anticipation of, a Change in Control which has been threatened or
proposed, such termination shall be deemed to have occurred after a Change in
Control for purposes of this Plan provided a Change in Control shall actually
have occurred.

         "Code" means the Internal Revenue Code of 1986, as amended.

         "Company" means Asta Funding, Inc. and any successor corporation within
the meaning of Code ss. 424(a) which issues or assumes a stock option in a
transaction to which Code ss. 424(a) applies.

         "Disability" means:

                  in the case of an Optionee whose employment with the Company
                  or a Subsidiary is subject to the terms of an employment
                  agreement between such Optionee and the Company or Subsidiary,
                  which employment agreement includes a definition of
                  "Disability", the term "Disability" as used in this Plan or
                  any Option Agreement shall have the meaning set forth in such
                  employment agreement during the period that such employment
                  agreement remains in effect; and
<PAGE>

                  in all other cases, the term "Disability" as used in this Plan
                  or any Option Agreement shall mean a physical or mental
                  infirmity that impairs substantially the Optionee's ability to
                  perform his or her duties for a period of one hundred eighty
                  (180) consecutive days.

         "Eligible Individual" means any officer, employee, or director of the
Company or any consultant or advisor to the Company who has been designated by
the Plan Committee as eligible to receive Options, subject to the conditions set
forth herein. "Eligible Individual" also shall include any person who has agreed
to become an officer, employee, director, consultant, or advisor; provided,
however, that any Option shall terminate immediately and be forfeited if the
Plan Committee determines, in its sole discretion, that such person will not
become an officer, employee, director, consultant, or advisor.

         "Exchange Act" means the Securities Exchange Act of 1934, as amended.

         "Fair Market Value" on any date means the closing sales prices of the
Shares on such date on the principal national securities exchange on which the
Shares are listed or admitted to trading, or, if the Shares are not so listed or
admitted to trading, the average of the per Share closing bid price and per
Share closing asked price on such date as quoted on the National Association of
Securities Dealers Automated Quotation System or such other market in which such
prices are regularly quoted, or, if there have been no published bid or asked
quotations with respect to Shares on such date, the Fair Market Value shall be
the value established by the Board in good faith and, in the case of an
Incentive Stock Option, in accordance with Code ss. 422.

          "Incentive Stock Option" means an Option satisfying the requirements
of Code ss. 422 and designated by the Plan Committee as an Incentive Stock
Option.

         "Mature Shares" means Shares that have been held by the Optionee for
more than six months.

         "Nonemployee Director" means a director of the Company who is a
"nonemployee director" within the meaning of Rule 16b-3 promulgated under the
Exchange Act.

         "Nonqualified Stock Option" means an Option that is not an Incentive
Stock Option.

         "Option" means a Nonqualified Stock Option, an Incentive Stock Option,
or either of them.

         "Optionee" means a person to whom an Option has been granted under the
Plan.

         "Outside Director" means a director of the Company who is an "outside
director" within the meaning of Code ss. 162(m) and the regulations promulgated
thereunder.

         "Parent" means any corporation that is a parent corporation (within the
meaning of Code ss. 424(e)) with respect to the Company.

         "Plan" means the Asta Funding Inc. 2002 Stock Option Plan, as amended
and restated from time to time.

         "Plan Committee" means a committee, as described in Section 0,
appointed by the Board of Directors to administer the Plan and to perform the
functions set forth herein. If at any time there is no Plan Committee, the Plan
Committee's functions shall be performed by the Board.
<PAGE>

         "Securities Act" means the Securities Act of 1933, as amended.

         "Shares" means the common stock, par value $0.01 per share, of the
Company.

         "Subsidiary" means any corporation that is a subsidiary corporation
(within the meaning of Code ss. 424(f)) with respect to the Company.

         "10-Percent Shareholder" means an Eligible Individual, who, at the time
an Incentive Stock Option is to be granted to him or her, owns (within the
meaning of Code ss. 422(b)(6)) stock possessing more than ten percent (10%) of
the total combined voting power of all classes of stock of the Company, or of a
Parent or a Subsidiary.

ADMINISTRATION.

         The Plan shall be administered by the Plan Committee, which shall hold
meetings at such times as may be necessary for the proper administration of the
Plan. The Plan Committee shall keep minutes of its meetings. A quorum shall
consist of not fewer than two members of the Plan Committee and a majority of a
quorum may authorize any action. Any decision or determination reduced to
writing and signed by a majority of all of the members of the Plan Committee
shall be as fully effective as if made by a majority vote at a meeting duly
called and held. The Plan Committee shall consist of at least two (2) directors
of the Company and may consist of the entire Board; provided, however, that (A)
if the Plan Committee consists of less than the entire Board, each member shall
be a Nonemployee Director; and (B) to the extent necessary for any Option or
Award intended to qualify as performance-based compensation under Code ss.
162(m) to so qualify, each member of the Plan Committee, whether or not it
consists of the entire Board, shall be an Outside Director. No member of the
Plan Committee shall be liable for any action, failure to act, determination or
interpretation made in good faith with respect to this Plan or any transaction
hereunder, except for liability arising from his or her own willful misfeasance,
gross negligence, or reckless disregard of his or her duties. The Company hereby
agrees to indemnify each member of the Plan Committee for all costs and expenses
and, to the extent permitted by applicable law, any liability incurred in
connection with defending against, responding to, negotiating for the settlement
of, or otherwise dealing with any claim, cause of action or dispute of any kind
arising in connection with any actions in administering this Plan or in
authorizing or denying authorization to any transaction hereunder.

         Subject to the express terms and conditions set forth herein, the Plan
Committee shall have the power from time to time to:

                  determine those Eligible Individuals to whom Options shall be
                  granted under the Plan and the number of such Options to be
                  granted and to prescribe the terms and conditions (which need
                  not be identical) of each such Option, including the purchase
                  price per Share subject to each Option, and make any amendment
                  or modification to any Option Agreement consistent with the
                  terms of the Plan;

                  to construe and interpret the Plan and the Options granted
                  hereunder and to establish, amend and revoke rules and
                  regulations for the administration of the Plan, including, but
                  not limited to, correcting any defect or supplying any
                  omission, or reconciling any inconsistency in the Plan or in
                  any Option Agreement, in the manner and to the extent it shall
                  deem necessary or advisable so that the Plan complies with
                  applicable law including Rule 16b-3 under the Exchange Act and
                  the Code to the extent applicable, and otherwise to make the
                  Plan fully effective. All decisions and determinations by the
                  Plan Committee in the exercise of this power shall be final,
                  binding and conclusive upon the Company, its Subsidiaries, the
                  Optionees, and all other persons having any interest therein;
<PAGE>

                  to determine the duration and purposes for leaves of absence
                  which may be granted to an Optionee on an individual basis
                  without constituting a termination of employment or service
                  for purposes of the Plan;

                  to exercise its discretion with respect to the powers and
                  rights granted to it as set forth in the Plan; and

                  generally, to exercise such powers and to perform such acts as
                  are deemed necessary or advisable to promote the best
                  interests of the Company with respect to the Plan.

STOCK SUBJECT TO THE PLAN.

         The maximum number of Shares that may be made the subject of Options
granted under the Plan is five hundred thousand (500,000) shares. The maximum
number of Shares with respect to which an Eligible Individual may be granted
Options during any fiscal year of the Plan is seventy-five thousand (75,000)
shares, and the maximum dollar amount that any Eligible Individual may receive
during the term of the Plan in respect of Options denominated in dollars is
$1,000,000. Upon a Change in Capitalization, the maximum number of Shares
referred to in the first two sentences of this Section 4.1 shall be adjusted in
number and kind pursuant to Section 10. The Company shall reserve for the
purposes of the Plan, out of its authorized but unissued Shares or out of Shares
held in the Company's treasury, or partly out of each, such number of Shares as
shall be determined by the Board.

         Upon the granting of an Option, the number of Shares available under
Section 4.1 for the granting of further Options shall be reduced as follows: In
connection with the granting of an Option, the number of Shares shall be reduced
by the number of Shares in respect of which the Option or Award is granted or
denominated.

         Whenever any outstanding Option or Award or portion thereof expires, is
canceled or is otherwise terminated for any reason without having been exercised
or payment having been made in respect of the entire Option or Award, the Shares
allocable to the expired, canceled or otherwise terminated portion of the Option
or Award may again be the subject of Options or Awards granted hereunder.

         Unless otherwise stated in the applicable Option Agreement, whenever
any portion of the purchase price of an Option is paid in previously owned
Shares, the Optionee shall be granted a new Option covering the same number of
Shares used to pay such portion of the purchase price. Such new Option shall
have a per share purchase price equal to the Fair Market Value of a Share on the
date of exercise of the first Option, shall be exercisable six months after the
date of grant of the new Option, and shall terminate on the same date as the
first Option.

<PAGE>

OPTION GRANTS FOR ELIGIBLE INDIVIDUALS.

         Authority of Plan Committee. Subject to the provisions of the Plan, the
Plan Committee shall have full and final authority to select those Eligible
Individuals who will receive Options, and the terms and conditions of the grant
to such Eligible Individuals shall be set forth in an Option Agreement;
provided, however, that no person shall receive any Incentive Stock Option
unless he or she is an employee of the Company, a Parent, or a Subsidiary at the
time the Incentive Stock Option is granted.

         Purchase Price. The purchase price or the manner in which the purchase
price is to be determined for Shares under each Option shall be determined by
the Plan Committee and set forth in the Option Agreement; provided, however,
that the purchase price per Share under each Incentive Stock Option shall not be
less than 100% of the Fair Market Value of a Share on the date the Option is
granted (110% in the case of an Incentive Stock Option granted to a 10-Percent
Shareholder).

         Maximum Duration. Options granted hereunder shall be for such term as
the Plan Committee shall determine; provided that an Incentive Stock Option
shall not be exercisable after the expiration of ten (10) years from the date it
is granted (five (5) years in the case of an Incentive Stock Option granted to a
10-Percent Shareholder), and a Nonqualified Stock Option shall not be
exercisable after the expiration of ten (10) years from the date it is granted.
The Plan Committee may, subsequent to the granting of any Option, extend the
term thereof, but in no event shall the term as so extended exceed the maximum
term provided for in the preceding sentence.

         Vesting. Unless otherwise designated by the Plan Committee and set
forth in the Option Agreement evidencing the grant of an Option, or unless
accelerated pursuant to Section 6.4, Options shall become fully vested and
exercisable with respect to 33.3% of the Shares subject thereto on the first,
second and third anniversaries of the date of grant; provided, however, that the
Optionee must be employed by, or otherwise in the service of, the Company or an
Affiliate on such anniversary date for the vesting to take place. The Plan
Committee may accelerate the exercisability of any Option or portion thereof at
any time.

         Modification. No modification of an Option shall alter adversely or
impair any rights or obligations under the Option without the Optionee's
consent.

TERMS AND CONDITIONS APPLICABLE TO ALL OPTIONS.

         Non-Transferability. Unless set forth in the Option Agreement
evidencing an Incentive Stock Option at the time of grant or at any time
thereafter, an Option granted hereunder shall not be transferable by the
Optionee to whom granted except by will or the laws of descent and distribution
or pursuant to a domestic relations order (within the meaning of Rule 16a-12
promulgated under the Exchange Act), and an Option may be exercised during the
lifetime of such Optionee only by the Optionee or his or her guardian or legal
representative. The terms of such Option shall be final, binding, and conclusive
upon the beneficiaries, executors, administrators, heirs and successors of the
Optionee.
<PAGE>

         Method of Exercise.

                  The exercise of an Option shall be made only by a written
                  notice delivered in person or by mail to the Secretary of the
                  Company at the Company's principal executive office,
                  specifying the number of Shares to be purchased and
                  accompanied by payment therefor and otherwise in accordance
                  with the Option Agreement pursuant to which the Option was
                  granted.

                  The purchase price for any Shares purchased pursuant to the
                  exercise of an Option shall be paid, as determined by the Plan
                  Committee in its discretion, in either of the following forms
                  (or any combination thereof): (i) cash or (ii) the transfer of
                  Mature Shares to the Company upon such terms and conditions as
                  determined by the Plan Committee. In addition, Options may be
                  exercised through a registered broker-dealer pursuant to such
                  cashless exercise procedures (other than Share withholding)
                  that are, from time to time, deemed acceptable by the Plan
                  Committee. Any Mature Shares transferred to the Company as
                  payment of the purchase price under an Option shall be valued
                  at their Fair Market Value on the day preceding the date of
                  exercise of such Option.

                  When the Optionee delivers the Option Agreement evidencing the
                  Option to the Secretary of the Company, the Secretary shall
                  endorse thereon a notation of such exercise and return the
                  Option Agreement to the Optionee. No fractional Shares (or
                  cash in lieu thereof) shall be issued upon exercise of an
                  Option, and the number of Shares that may be purchased upon
                  exercise shall be rounded to the nearest number of whole
                  Shares.

         Rights of Optionees. Optionee shall not be deemed for any purpose to be
the owner of any Shares subject to any Option unless and until (i) the Option
shall have been exercised pursuant to the terms thereof; (ii) the Company shall
have issued and delivered Shares to the Optionee; and (iii) the Optionee's name
shall have been entered as a stockholder of record on the books of the Company.
Thereupon, the Optionee shall have full voting, dividend, and other ownership
rights with respect to such Shares, subject to such terms and conditions as may
be set forth in the applicable Option Agreement.

         Effect of Change in Control. In the event of a Change in Control, then
each outstanding Option shall (a) be deemed to be fully vested and exercisable
immediately prior to the effective time of the Change in Control (including
Shares that would not be vested or exercisable otherwise); and (b) be assumed or
an equivalent option or right substituted by the successor corporation or a
Parent or Subsidiary of the successor corporation. For the purposes of this
paragraph, an outstanding Option shall be considered assumed if, following the
consummation of the Change in Control, the Option confers the right to purchase
or receive, for each Share subject to the Option immediately prior to the
consummation of the Change in Control, the consideration (whether stock, cash,
or other securities or property) received in the Change in Control by holders of
Common Stock for each Share held on the effective date of the transaction (and
if holders were offered a choice of consideration, the type chosen by the
holders of a majority of the outstanding Shares); provided, however, that if
such consideration received in the Change in Control is not solely common stock
of the successor corporation or its Parent, the Administrator may, with the
consent of the successor corporation, provide for the consideration to be
received upon the exercise of the Option, for each Share of Optioned Stock
subject to the Option, to be solely common stock of the successor corporation or
its Parent or Subsidiary equal in fair market value to the per share
consideration received by holders of Common Stock in the Change in Control.
<PAGE>

EFFECT OF A TERMINATION OF EMPLOYMENT.

                  The Option Agreement evidencing the grant of each Option may
set forth the terms and conditions applicable to such Option upon a termination
or change in the status of the employment of the Optionee by the Company or a
Subsidiary (including a termination or change by reason of the sale of the
Subsidiary), which shall be as the Plan Committee may, in its discretion,
determine at the time the Option is granted or thereafter. In the absence of
such provisions in an Option Agreement and unless specifically set forth in an
Option Agreement to the contrary, the following rules shall apply:

         In the event that an Optionee's employment or service with the Company
is terminated for Cause, any and all Options granted to the Optionee hereunder
that have not been exercised or paid as of the date of such Optionee's
termination of employment shall immediately terminate, lapse, or be forfeited.

         In the event that an Optionee's employment or service with the Company
terminates due to death or Disability, all Options owned by such Optionee may be
exercised, to the extent exercisable on the date of termination of employment,
at any time within one year after such date of termination (at the end of which
period, all such Options shall lapse), by such decedent's executors or personal
administrators or by such disabled Optionee.

         In the event that an Optionee's employment or service with the Company
terminates for any reason other than those set forth in paragraphs 0 or 0 above,
all Options held by such Optionee shall be exercisable, but only to the extent
exercisable on the date of termination of employment, by such Optionee for a
period of up to the earlier of (A) ninety (90) days after such termination of
employment; and (B) the expiration date of such Options. At the end of such
period, all such Options shall lapse.

ADJUSTMENT UPON CHANGES IN CAPITALIZATION.

         In the event of a Change in Capitalization, the Plan Committee shall
determine conclusively the appropriate adjustments, if any, to (a) the maximum
number and class of Shares or other stock or securities with respect to which
Options may be granted under the Plan; (b) the maximum number and class of
Shares or other stock or securities with respect to which Options or Awards may
be granted to any Eligible Individual during the term of the Plan; (c) the
number and class of Shares or other stock or securities subject to outstanding
Options or Awards granted under the Plan and the purchase price therefor, if
applicable; and (d) the Performance Objectives.

         Any such adjustment in the Shares or other stock or securities subject
to outstanding Incentive Stock Options (including any adjustments in the
purchase price) shall be made in such a manner as shall not constitute a
modification as defined by Code ss. 424(h)(3) and only to the extent otherwise
permitted by Code ss.ss. 422 and 424.

         If, by reason of a Change in Capitalization, an Optionee shall be
entitled to exercise an Option with respect to, new, additional, or different
shares of stock or securities, such new, additional, or different shares shall
thereupon be subject to all of the conditions, restrictions, and performance
criteria that were applicable to the Shares subject to the Award or Option, as
the case may be, prior to such Change in Capitalization.
<PAGE>

INTERPRETATION.

         The Plan is intended to comply with Rule 16b-3 promulgated under the
Exchange Act, and the Plan Committee shall interpret and administer the
provisions of the Plan or any Option Agreement in a manner consistent therewith.
Any provisions inconsistent with such Rule shall be inoperative and shall not
affect the validity of the Plan.

         Unless otherwise expressly stated in the relevant Option Agreement,
each Option granted under the Plan is intended to be performance-based
compensation within the meaning of Code ss. 162(m)(4)(C). The Plan Committee
shall not be entitled to exercise any discretion otherwise authorized hereunder
with respect to such Options or Awards if the ability to exercise such
discretion or the exercise of such discretion itself would cause the
compensation attributable to such Options or Awards to fail to qualify as
performance-based compensation.

TERMINATION AND AMENDMENT OF THE PLAN.

                  The Plan shall terminate on the day preceding the tenth
anniversary of the date of its adoption by the Board, and no Option may be
granted thereafter. The Board may terminate the Plan sooner, and the Board may
at any time and from time to time amend, modify, or suspend the Plan; provided,
however, that:

         no such amendment, modification, suspension, or termination shall
impair or adversely alter any Options theretofore granted under the Plan, except
with the consent of the Optionee, nor shall any amendment, modification,
suspension, or termination deprive any Optionee of any Shares that he or she may
have acquired through or as a result of the Plan; and

         to the extent necessary under applicable law, no amendment shall be
effective unless approved by the stockholders of the Company in accordance with
applicable law.

NON-EXCLUSIVITY OF THE PLAN.

                  The adoption of the Plan by the Board shall not be construed
as amending, modifying, or rescinding any previously approved incentive
arrangement or as creating any limitations on the power of the Board to adopt
such other incentive arrangements as it may deem desirable, including, without
limitation, the granting of stock options otherwise than under the Plan, and
such arrangements may be either applicable generally or only in specific cases.

LIMITATION OF LIABILITY.
                  As illustrative of the limitations of liability of the
Company, but not intended to be exhaustive thereof, nothing in the Plan shall be
construed to:

         give any person any right to be granted an Option or Award other than
at the sole discretion of the Plan Committee;

         give any person any rights whatsoever with respect to Shares except as
specifically provided in the Plan;

         limit in any way the right of the Company or any Subsidiary to
terminate the employment of any person at any time; or
<PAGE>

         be evidence of any agreement or understanding, expressed or implied,
that the Company will employ any person at any particular rate of compensation
or for any particular period of time.

REGULATIONS AND OTHER APPROVALS; GOVERNING LAW.

         Governing Law. Except as to matters of federal law, the Plan and the
rights of all persons claiming hereunder shall be construed and determined in
accordance with the laws of the State of Delaware without giving effect to
conflicts of laws principles thereof.

         Delivery of Shares. The obligation of the Company to sell or deliver
Shares with respect to Options granted under the Plan shall be subject to all
applicable laws, rules and regulations, including all applicable federal and
state securities laws, and the obtaining of all such approvals by governmental
agencies as may be deemed necessary or appropriate by the Plan Committee.

         Changes. The Board may make such changes as may be necessary or
appropriate to comply with the rules and regulations of any government
authority, or to obtain for Eligible Individuals granted Incentive Stock Options
the tax benefits under the applicable provisions and regulations promulgated
thereunder.

         Registration. Each Option and Award is subject to the requirement that,
if at any time the Plan Committee determines, in its discretion, that the
listing, registration, or qualification of Shares issuable pursuant to the Plan
is required by any securities exchange or under any state or federal law, or the
consent or approval of any governmental regulatory body is necessary or
desirable as a condition of, or in connection with, the grant of an Option or
Award or the issuance of Shares, no Options or Awards shall be granted or
payment made or Shares issued, in whole or in part, unless listing,
registration, qualification, consent or approval has been effected or obtained
free of any conditions as acceptable to the Plan Committee.

         Regulatory Restrictions. Notwithstanding anything contained in the Plan
or any Option Agreement to the contrary, in the event that the disposition of
Shares acquired pursuant to the Plan is not covered by a then-current
registration statement under the Securities Act, and is not otherwise exempt
from such registration, such Shares shall be restricted against transfer to the
extent required by the Securities Act and Rule 144 or other regulations
thereunder. The Plan Committee may require any individual receiving Shares
pursuant to an Option or Award granted under the Plan, as a condition precedent
to receipt of such Shares, to represent and warrant to the Company in writing
that the Shares acquired by such individual are acquired without a view to any
distribution thereof and will not be sold or transferred other than pursuant to
an effective registration thereof under said Act or pursuant to an exemption
applicable under the Securities Act or the rules and regulations promulgated
thereunder. The certificates evidencing any of such Shares shall be
appropriately amended to reflect their status as restricted securities as
aforesaid.

MISCELLANEOUS.

         Multiple Option Agreements. The terms of each Option or Award shall be
stated in an agreement between the Company and the Eligible Individual in a form
approved by the Plan Committee. The Eligible Individual must execute and deliver
the agreement to the Company as a condition to the effectiveness of the Option
or Award. All such agreements may contain all terms and conditions as the Plan
Committee considers advisable that are not inconsistent with the Plan,
including, but not limited to, transfer restrictions, repurchase rights, rights
of first refusal, non-compete, non-solicitation and confidentiality covenants,
forfeiture provisions, representations and warranties of the Eligible Individual
and provisions to ensure compliance with all applicable laws, regulations and
rules. The terms of each Option or Award may differ from other Options or Awards
granted under the Plan at the same time, or at some other time. The Plan
Committee may also grant more than one Option or Award to a given Eligible
Individual during the term of the Plan, either in addition to, or in
substitution for, one or more Options or Awards previously granted to that
Eligible Individual.
<PAGE>

         Withholding of Taxes.

                  At such times as an Optionee recognizes taxable income in
                  connection with the receipt of Shares or cash hereunder (a
                  "Taxable Event"), the Optionee shall pay to the Company an
                  amount equal to the federal, state, and local income taxes and
                  other amounts as may be required by law to be withheld by the
                  Company in connection with the Taxable Event (the "Withholding
                  Taxes") prior to the issuance, or release from escrow, of such
                  Shares or the payment of such cash. The Company shall have the
                  right to deduct from any payment of cash to an Optionee an
                  amount equal to the Withholding Taxes in satisfaction of the
                  obligation to pay Withholding Taxes. In satisfaction of the
                  obligation to pay Withholding Taxes to the Company, the
                  Optionee may make a written election (the "Tax Election"),
                  which may be accepted or rejected in the discretion of the
                  Plan Committee, to have withheld a portion of the Shares then
                  issuable to him or her having an aggregate Fair Market Value
                  equal to the Withholding Taxes.

                  If an Optionee makes a disposition, within the meaning of Code
                  ss. 424(c) and regulations promulgated thereunder, of any
                  Share or Shares issued to such Optionee pursuant to the
                  exercise of an Incentive Stock Option within the two-year
                  period commencing on the day after the date of the grant or
                  within the one-year period commencing on the day after the
                  date of transfer of such Share or Shares to the Optionee
                  pursuant to such exercise, the Optionee shall, within ten (10)
                  days of such disposition, notify the Company thereof, by
                  delivery of written notice to the Company at its principal
                  executive office.

         Effective Date. The effective date of this Plan shall be as determined
by the Board, subject only to approval, pursuant to Code ss. 422(b)(2), by the
affirmative vote of a majority of the Company's stockholders present or
represented at a meeting of stockholders duly held in accordance with the
applicable laws of the State of Delaware within twelve (12) months of the
adoption of the Plan by the Board, and entitled to vote at such meeting.