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                                                                   Exhibit 10.7


                                SERVICEWARE, INC.
                     AMENDED AND RESTATED STOCK OPTION PLAN


1.  PURPOSE OF THE PLAN.

    The purpose of the ServiceWare, Inc. Amended and Restated Stock Option Plan
(the "Plan") is to promote the interests of ServiceWare, Inc. (the "Company")
and its shareholders by (i) attracting and retaining employees, officers,
directors, consultants and advisors of outstanding ability, (ii) motivating such
persons, by means of performance-related incentives, to achieve longer-range
performance goals, and (iii) enabling such persons to participate in the
long-term growth and financial success of the Company. The effective date of the
ServiceWare, Inc. Amended and Restated Stock Option Plan is January 1, 1996 (the
"Effective Date").

2.  ADMINISTRATION.

    Subject to the following paragraph, the Plan shall be administered by the
Board of Directors of the Company (the "Board") or by a Compensation Committee
appointed by the Board. If the Board appoints a Compensation Committee and
delegates to it the authority to administer the Plan, the Compensation Committee
shall be empowered to take all actions reserved to the Board under the Plan. The
Board is authorized to interpret the Plan, to prescribe, amend and rescind rules
and regulations to further the purposes of the Plan, and to make all other
determinations necessary for the administration of the Plan. All such actions by
the Board shall be final and binding.

    At any time following the registration by the Company of its Common Stock
under Section 12 of the Securities Exchange Act of 1934, as amended (the
"Exchange Act"), the Plan shall be administered by a Compensation Committee,
which shall consist of one or more persons approved by the Board, all of whom
shall be (i) "Non-Employee Directors" as defined under Rule 16b-3 under the
Exchange Act and (ii) "outside directors" as defined under Section 162(m) or any
successor provision of the Internal Revenue Code of 1986, as amended (the
"Code") and applicable Treasury regulations thereunder, if such qualification is
deemed necessary in order for the grant or the exercise of awards made under the
Plan to qualify for any tax or other material benefit to participants or the
Company under applicable law.

3.  INCENTIVE STOCK OPTIONS; NONQUALIFIED STOCK OPTIONS.

    Awards under the Plan may be in the form of options which qualify as
"incentive stock options" ("Incentive Stock Options") within the meaning of
Section 422 or any successor provision of the Code or options which do not so
qualify ("Nonqualified Options"). Incentive Stock Options may be granted only to
employees of the Company. Each award of an option shall be designated in the
applicable option agreement as an Incentive Stock Option or a Nonqualified
Option, as appropriate.

4.  SHARES SUBJECT TO THE PLAN.
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    Subject to adjustment as provided in Section 13, awards in respect of an
aggregate of up to 1,512,500 shares of the Common Stock of the Company, no par
value per share (the "Common Stock"), may be made under the Plan (such number of
shares includes shares which have been issued under the ServiceWare, Inc. 1994
Stock Option/Stock Issuance Plan, or which may be issued upon the exercise of
options granted under the ServiceWare, Inc. 1994 Stock Option/StockIssuance
Plan, prior to the Effective Date). The Common Stock to be offered under the
Plan shall be authorized and unissued Common Stock, or issued Common Stock which
shall have been reacquired by the Company and held in its treasury. The Common
Stock covered by any unexercised portion of terminated stock options granted
under the Plan may again be subject to new awards under the Plan. In the event
the purchase price of a stock option is paid in whole or in part through the
delivery of Common Stock, only the net number of shares of Common Stock issuable
in connection with the exercise of the option shall be counted against the
number of shares remaining available for the grant of awards under the Plan. At
any time following the registration by the Company of its Common Stock under
Section 12 of the Exchange Act, no participant shall be granted awards in
respect of more than 425,000 shares of Common Stock in any calendar year
(subject to adjustment as provided in Section 13).

5.  PARTICIPANTS.

    The Board shall determine and designate from time to time those employees,
directors, consultants and advisors of the Company or its subsidiaries who shall
be awarded options under the Plan and the number of shares of Common Stock to be
covered by each such option, provided that any such consultants or advisors
render bona fide services which are not in connection with the offer or sale of
securities in a capital-raising transaction. In making its determinations, the
Board shall take into account the present and potential contributions of the
respective individuals to the success of the Company, and such other factors as
the Board shall deem relevant in connection with accomplishing the purposes of
the Plan. Each option award shall be evidenced by a written stock option
agreement in such form as the Board shall approve from time to time.

6.  FAIR MARKET VALUE.

    For all purposes under the Plan, the term "Fair Market Value" shall mean, as
of any applicable date, (i) if the principal securities market on which the
Common Stock is traded is a national securities exchange or The Nasdaq National
Market ("NNM"), the closing price of the Common Stock on such exchange or NNM,
as the case may be, or if no sale of the Common Stock shall have occurred on
such date, on the next preceding date on which there was a reported sale; or
(ii) if the Common Stock is not traded on a national securities exchange or NNM,
the closing price on such date as reported by The Nasdaq SmallCap Market, or if
no sale of the Common Stock shall have occurred on such date, on the next
preceding date on which there was a reported sale; or (iii) if the principal
securities market on which the Common Stock is traded is not a national
securities exchange, NNM or The Nasdaq SmallCap Market, the average of the bid
and asked prices reported by the National Quotation Bureau, Inc.; or (iv) if the
price of the Common Stock is not so reported, the Fair Market Value of the
Common Stock as determined in good faith by the Board.

7.  EXERCISE PRICE.

    Incentive Stock Options shall be granted at an exercise price of not less
than 100% of the Fair Market Value on the date of grant; provided, however, that
Incentive Stock Options granted to a participant who at the time of such grant
owns (within the meaning of Section 424(d) of the Code) more
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than ten percent of the voting power of all classes of stock of the Company (a
"10% Holder") shall be granted at an exercise price of not less than 110% of the
Fair Market Value on the date of grant. Nonqualified Options shall be granted at
an exercise price determined in each case by the Board.
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8.  TERM AND TERMINATION.

    (a) The Board shall determine the term within which each option may be
exercised, in whole or in part, provided that (i) such term shall not exceed ten
years from the date of grant; (ii) the term of an Incentive Stock Option granted
to a 10% Holder shall not exceed five years from the date of grant; and (iii)
the aggregate Fair Market Value (determined on the date of grant) of Common
Stock with respect to which Incentive Stock Options granted to a participant
under the Plan or any other plan of the Company and its subsidiaries become
exercisable for the first time in any single calendar year shall not exceed
$100,000.

    (b) Unless otherwise determined by the Board, all rights to exercise options
shall terminate on the first to occur of (i) the scheduled expiration date as
set forth in the applicable stock option agreement, or (ii) ninety (90) days
following the date of termination of employment for any reason other than the
death or permanent disability (as defined in the Code) of the participant, or
(iii) one (1) year following the date of termination of employment by reason of
the participant's death or permanent disability; provided, however, that in the
event that an employee ceases to be employed by the Company on account of a
"termination for cause" (as defined in subsection (c)), all rights to exercise
options held by such employee shall terminate immediately as of the date such
employee ceases to be employed by the Company.

    (c) As used in this Plan, the term "termination for cause" shall mean a
finding by the Board that the employee has engaged in conduct that is
fraudulent, disloyal, criminal or injurious to the Company, including, without
limitation, embezzlement, theft, commission of a felony or proven dishonesty in
the course of his or her employment or service, or the disclosure of trade
secrets or confidential information of the Company to persons not entitled to
receive such information.

9.  RIGHT OF FIRST REFUSAL; RIGHT TO REPURCHASE.

    (a) At any time prior to the registration by the Company of its Common Stock
under Section 12 of the Exchange Act, the Company shall have a right of first
refusal with respect to any proposed sale or other disposition by optionees (and
their successors in interest by purchase, gift or other mode of transfer) of any
shares of Common Stock issued upon the exercise of options granted under the
Plan. Such right shall be exercisable by the Company in accordance with the
terms and conditions established by the Board and set forth in the applicable
stock option agreement.

    (b) At any time prior to the registration by the Company of its Common Stock
under Section 12 of the Exchange Act, in the event that an employee is
terminated for cause (as defined in Section 8(c)), the Company shall have the
right, exercisable in accordance with the terms and conditions established by
the Board and set forth in the applicable stock option agreement, to repurchase
any shares of Common Stock issued to such terminated employee under the Plan.

10. CHANGE OF CONTROL.

    As used herein, a "Change of Control" shall be deemed to have occurred:

    (a) If, as a result of any transaction, any "person" (as such term is used
in Section 13(d) and 14(d) of the Exchange Act) other
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than an existing shareholder as of the effective date of the Plan (or his
beneficiary or estate) is or becomes a "beneficial owner" (as defined in Rule
13d-3 under the Exchange Act), directly or indirectly of securities of the
Company representing more than 50% of the combined voting power of the then
outstanding securities of the Company;

    (b) Upon (i) the merger or consolidation of the Company with another
corporation where the shareholders of the Company, immediately prior to the
merger or consolidation, will not beneficially own, immediately after the merger
or consolidation, shares entitling such shareholders to 50% or more of the all
votes to which all shareholders of the surviving corporation would be entitled
in the election of directors (without consideration of the rights of any class
of stock to elect directors by a separate class vote), or where the members of
the Board, immediately prior to the merger or consolidation, would not,
immediately after the merger or consolidation, constitute a majority of the
board or directors of the surviving corporation, (ii) the sale, lease, exchange
or other transfer of all or substantially all of the assets of the Company,
(iii) a liquidation, dissolution or statutory exchange of the Company, or (iv)
the sale of more than 50% or more of the outstanding voting securities in one or
a series of transactions other than an initial public offering of voting
securities registered with the Securities and Exchange Commission.

    (c) If, on or after the Effective Date, during any period of two consecutive
years, individuals who constitute the Board at the beginning of such period
cease for any reason to constitute at least a majority of the Board, unless the
election, or the nomination for election by the Company's shareholders, of each
new director was approved by a vote of at least two-thirds of the directors then
still in office who were directors at the beginning of the period.

11. CONSEQUENCES OF A CHANGE OF CONTROL.

    (a) Subject to Section 11(b) and 11(d), upon a Change of Control, all
outstanding options granted under this Plan shall automatically accelerate so
that each such option shall, immediately prior to the specified effective date
of the Change of Control, become immediately exercisable and each holder of
outstanding options shall thereupon have the right to exercise in full any or
all of his or her outstanding stock options.

    (b) Notwithstanding Section 11(a), an outstanding option shall not
accelerate if and to the extent that such option is, in connection with the
Change of Control, either assumed by the Acquiring Corporation (as defined
below) or parent thereof or replaced with a comparable option to purchase shares
of the capital stock of the Acquiring Corporation or parent thereof (such
assumed and comparable options together, the "Replacement Options"); provided,
however, all Replacement Options held by an employee whose employment with the
Company or the Acquiring Corporation is terminated without cause (as defined in
Section 8(c)) in the period beginning upon the Change of Control and ending 12
months following the Change of Control, shall become immediately exercisable
upon the date of such termination of employment. The term "Acquiring
Corporation" means the surviving, continuing, successor or purchasing
corporation, as the case may be.

    (c) Each outstanding option which is to be assumed in connection with the
Change of Control or is otherwise to continue in effect shall be appropriately
adjusted, immediately following such Change of Control, to apply and pertain to
the number and class of securities which would have been issuable, in
consummation of such Change of Control, to an actual holder of the same number
of shares of Common Stock as are subject to such option immediately prior to
such Change of Control. Appropriate
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adjustments shall also be made to the option price payable per share, provided
the aggregate option price payable remains the same.

    (d) Notwithstanding anything in this Plan to the contrary, in the event of a
Change of Control, no action described in this Plan shall be taken (including
without limitation actions described in subsections (a) and (b) above) that
would make the Change of Control ineligible for pooling of interest accounting
treatment or that would make the Change of Control ineligible for desired tax
treatment if, in the absence of such right, the Change of Control would qualify
for such treatment and the Company intends to use such treatment with respect to
such Change of Control.

12. OTHER TERMS AND CONDITIONS.

    The Board shall have the discretion to determine terms and conditions,
consistent with the Plan, that will be applicable to options. Options granted to
the same or different participants, or at the same or different times, need not
contain similar provisions.

13. ADJUSTMENTS TO REFLECT CAPITAL CHANGES.

    The number and kind of shares subject to outstanding options, the exercise
price applicable thereto, and the number and kind of shares available for
options subsequently granted under the Plan shall be appropriately adjusted to
reflect any stock dividend, stock split, combination or exchange of shares or
other change in capitalization with a similar substantive effect upon the Plan
or the awards granted under the Plan. The Board shall have the power and sole
discretion to determine the nature and amount of the adjustment to be made in
each case. The adjustment so made shall be final and binding on all
participants.

14. PAYMENT FOR STOCK.

    Full payment for shares purchased upon exercise of options granted under the
Plan shall be made at the time the award is exercised in whole or in part.
Payment of the purchase price shall be made in cash or in such other form as the
Board may approve, including, without limitation, (i) by the delivery to the
Company by the participant of a promissory note containing such terms as the
Board may determine, or (ii) by the delivery to the Company by the participant
of shares of Common Stock that have been held by the participant for at least
six months prior to exercise of the award, valued at the Fair Market Value of
such shares on the date of exercise or (iii) if the Company's Common Stock is
publicly traded, pursuant to a cashless exercise arrangement with a broker on
such terms as the Board may determine; provided, however, that if payment is
made pursuant to clause (i), the then par value of the purchased shares shall be
paid in cash. No shares of Common Stock shall be issued to the participant until
such payment has been made, and a participant shall have none of the rights of a
shareholder with respect to options held by such participant.

15. TRANSFERABILITY.

    Unless otherwise determined by the Board with respect to Nonqualified
Options, options granted under the Plan shall not be transferable other than by
will or the laws of descent and distribution and are exercisable during a
participant's lifetime only by the participant.

16. WITHHOLDING.
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    The Company shall have the right to deduct from all amounts paid to a
participant in cash as salary, bonus or other compensation any taxes required by
law to be withheld in respect of awards granted under the Plan. In the Board's
discretion, a participant may be permitted to elect to have withheld from the
shares otherwise issuable to the participant, or to tender to the Company, the
number of shares of Common Stock whose Fair Market Value equals the amount
required to be withheld.
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17. CONSTRUCTION OF THE PLAN.

    The validity, construction, interpretation, administration and effect of the
Plan and of its rules and regulations, and rights relating to the Plan, shall be
determined solely by the Board. Any determination by the Board shall be final
and binding on all participants. The Plan shall be governed in accordance with
the laws of the Commonwealth of Pennsylvania, without regard to the conflict of
law provisions of such laws.

18. NO RIGHT TO AWARD; NO RIGHT TO EMPLOYMENT.

    No person shall have any claim of right to be granted an option under the
Plan. Neither the Plan nor any action taken hereunder shall be construed as
giving any employee any right to be retained in the employ of the Company or any
of its subsidiaries or as giving any consultant, adviser or director any right
to continue to serve in such capacity.

19. AWARDS NOT INCLUDABLE FOR BENEFIT PURPOSES.

    Income recognized by a participant pursuant to the provisions of the Plan
shall not be included in the determination of benefits under any employee
pension benefit plan (as such term is defined in Section 3(2) of the Employee
Retirement Income Security Act of 1974) or group insurance or other benefit
plans applicable to the participant which are maintained by the Company or any
of its subsidiaries, except as may be provided under the terms of such plans or
determined by resolution of the Board.

20. NO STRICT CONSTRUCTION.

    No rule of strict construction shall be implied against the Company, the
Board, or any other person in the interpretation of any of the terms of the
Plan, any award granted under the Plan or any rule or procedure established by
the Board.

21. CAPTIONS.

    All Section headings used in the Plan are for convenience only, do not
constitute a part of the Plan, and shall not be deemed to limit, characterize or
affect in any way any provisions of the Plan, and all provisions of the Plan
shall be construed as if no captions have been used in the Plan.

22. SEVERABILITY.

    Whenever possible, each provision in the Plan and every award at any time
granted under the Plan shall be interpreted in such manner as to be effective
and valid under applicable law, but if any provision of the Plan or any award at
any time granted under the Plan shall be held to be prohibited by or invalid
under applicable law, then such provision shall be deemed amended to accomplish
the objectives of the provision as originally written to the fullest extent
permitted by law, and all other provisions of the Plan and every other award at
any time granted under the Plan shall remain in full force and effect.

23. LEGENDS.

    All certificates for Common Stock delivered under the Plan shall be subject
to such transfer and other restrictions as the Board may deem advisable under
the rules, regulations and other requirements of the Securities and Exchange
Commission, any stock exchange or quotation system upon which the
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Common Stock is then listed or quoted and any applicable federal or state
securities law, and the Board may cause a legend or legends to be put on any
such certificates to make appropriate references to such restrictions.

24. AMENDMENT.

    The Board may, by resolution, amend or revise the Plan, except that such
action shall not be effective without shareholder approval if such shareholder
approval is required to maintain the compliance of the Plan and/or awards
granted to directors, executive officers or other persons with Rule 16b-3
promulgated under the Exchange Act or any successor rule. The Board may not
modify any options previously granted under the Plan in a manner adverse to the
holders thereof without the consent of such holders, except in accordance with
the provisions of Section 11 or Section 13.

25. EFFECTIVE DATE; TERMINATION OF PLAN.

      The Plan was initially adopted by the Board and the shareholders of the
Company on February 15, 1994 (the "Initial Effective Date") as the ServiceWare,
Inc. 1994 Stock Option/Stock Issuance Plan and was amended and restated in its
entirety effective as of January 1, 1996. The Plan shall terminate on the tenth
anniversary of the Initial Effective Date unless it is earlier terminated by the
Board. Termination of the Plan shall not affect awards previously granted under
the Plan.