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                                                                Exhibit 10.3

                          MICROSTRATEGY INCORPORATED

                           1997 DIRECTOR OPTION PLAN

  1. Purposes of the Plan. The purposes of this 1997 Director Option Plan are
to attract and retain the best available personnel for service as Outside
Directors (as defined herein) of the Company, to provide additional incentive
to the Outside Directors of the Company to serve as Directors, and to
encourage their continued service on the Board.

  All options granted hereunder shall be nonstatutory stock options.

  2. Definitions. As used herein, the following definitions shall apply:

    (a) "Board" means the Board of Directors of the Company.

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

    (c) "Common Stock" means the Class A Common Stock of the Company.

    (d) "Company" means Microstrategy Incorporated, a Delaware corporation.

    (e) "Director" means a member of the Board.

    (f) "Employee" means any person, including officers and Directors,
  employed by the Company or any Parent or Subsidiary of the Company. The
  payment of a Director's fee by the Company shall not be sufficient in and
  of itself to constitute "employment" by the Company.

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

    (h) "Fair Market Value" means, as of any date, the value of Common Stock
  determined as follows:

      (i) If the Common Stock is listed on any established stock exchange
    or a national market system, including without limitation the Nasdaq
    National Market or The Nasdaq SmallCap Market of The Nasdaq Stock
    Market, its Fair Market Value shall be the closing sales price for such
    stock (or the closing bid, if no sales were reported) as quoted on such
    exchange or system for the last market trading day prior to the time of
    determination, as reported in The Wall Street Journal or such other
    source as the Administrator deems reliable;

      (ii) If the Common Stock is regularly quoted by a recognized
    securities dealer but selling prices are not reported, the Fair Market
    Value of a Share of Common Stock shall be the mean between the high bid
    and low asked prices for the Common Stock on the date of determination,
    as reported in The Wall Street Journal or such other source as the
    Board deems reliable, or;

      (iii) In the absence of an established market for the Common Stock,
    the Fair Market Value thereof shall be determined in good faith by the
    Board.

    (i) "Inside Director" means a Director who is an Employee.

    (j) "Option" means a stock option granted pursuant to the Plan.

    (k) "Optioned Stock" means the Common Stock subject to an Option.

    (l) "Optionee" means a Director who holds an Option.

    (m) "Outside Director" means a Director who is not an Employee.

    (n) "Parent" means a "parent corporation," whether now or hereafter
  existing, as defined in Section 424(e) of the Code.

    (o) "Plan" means this 1997 Director Option Plan.

    (p) "Share" means a share of the Common Stock, as adjusted in accordance
  with Section 10 of the Plan.



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    (q) "Subsidiary" means a "subsidiary corporation," whether now or
  hereafter existing, as defined in Section 424(f) of the Code.

  3. Stock Subject to the Plan. Subject to the provisions of Section 10 of the
Plan, the maximum aggregate number of Shares which may be optioned and sold
under the Plan is 200,000 Shares of Common Stock (the "Pool"). The Shares may
be authorized, but unissued, or reacquired Common Stock.

  If an Option expires or becomes unexercisable without having been exercised
in full, the unpurchased Shares which were subject thereto shall become
available for future grant or sale under the Plan (unless the Plan has
terminated). Shares that have actually been issued under the Plan shall not be
returned to the Plan and shall not become available for future distribution
under the Plan.

  4. Administration and Grants of Options under the Plan.

    (a) Procedure for Grants. The provisions set forth in this Section 4(a)
  shall not be amended more than once every six months, other than to comport
  with changes in the Code, the Employee Retirement Income Security Act of
  1974, as amended, or the rules thereunder. All grants of Options to Outside
  Directors under this Plan shall be automatic and nondiscretionary and shall
  be made strictly in accordance with the following provisions:

      (i) No person shall have any discretion to select which Outside
    Directors shall be granted Options or to determine the number of Shares
    to be covered by Options granted to Outside Directors.

      (i) Each Outside Director shall be automatically granted an Option to
    purchase 45,000 Shares (the "First Option") on the date on which the
    later of the following events occurs: (A) the effective date of this
    Plan, as determined in accordance with Section 6 hereof, or (B) the
    date on which such person first becomes an Outside Director, whether
    through election by the shareholders of the Company or appointment by
    the Board to fill a vacancy; provided, however, that an Inside Director
    who ceases to be an Inside Director but who remains a Director shall
    not receive a First Option.

      (ii) Each Outside Director shall be granted an Option to purchase
    5,000 Shares (a "Subsequent Option") each year on the date of the
    annual stockholders' meeting provided he or she is then an Outside
    Director and if as of such date, he or she shall have served on the
    Board for at least the preceding six (6) months.

      (iv) Notwithstanding the provisions of subsections (ii) and (iii)
    hereof, any exercise of an Option granted before the Company has
    obtained stockholder approval of the Plan in accordance with Section 16
    hereof shall be conditioned upon obtaining such stockholder approval of
    the Plan in accordance with Section 16 hereof.

      (v) The terms of a First Option granted hereunder shall be as
    follows:

        (A) the term of the First Option shall be ten (10) years.

        (B) the First Option shall vest and become exercisable only
      pursuant to the terms of the Director Option Agreement evidencing
      such First Option, except as set forth in Sections 8 and 10 hereof.

        (C) the exercise price per Share shall be 100% of the Fair Market
      Value per Share on the date of grant of the First Option. In the
      event that the date of grant of the First Option is not a trading
      day, the exercise price per Share shall be the Fair Market Value on
      the next trading day immediately following the date of grant of the
      First Option.

        (D) subject to Section 10 hereof, the First Option shall become
      vested as to twenty percent (20%) of the Shares subject to the First
      Option on each anniversary of its date of grant, provided that the
      Optionee continues to serve as a Director on such dates.

      (vi) The terms of a Subsequent Option granted hereunder shall be as
    follows:

        (A) the term of the Subsequent Option shall be ten (10) years.



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        (B) the Subsequent Option shall vest and become exercisable only
      pursuant to the terms of the Director Option Agreement evidencing
      such Subsequent Option, except as set forth in Sections 8 and 10
      hereof.

        (C) the exercise price per Share shall be 100% of the Fair Market
      Value per Share on the date of grant of the Subsequent Option. In
      the event that the date of grant of the Subsequent Option is not a
      trading day, the exercise price per Share shall be the Fair Market
      Value on the next trading day immediately following the date of
      grant of the Subsequent Option.

        (D) subject to Section 10 hereof, the Subsequent Option shall vest
      as to one hundred percent (100%) of the Shares subject to the
      Subsequent Option on the fifth anniversary of its date of grant,
      provided that the Optionee continues to serve as a Director on such
      date.

      (vii) In the event that any Option granted under the Plan would cause
    the number of Shares subject to outstanding Options plus the number of
    Shares previously purchased under Options to exceed the Pool, then the
    remaining Shares available for Option grant shall be granted under
    Options to the Outside Directors on a pro rata basis. No further grants
    shall be made until such time, if any, as additional Shares become
    available for grant under the Plan through action of the Board or the
    stockholders to increase the number of Shares which may be issued under
    the Plan or through cancellation or expiration of Options previously
    granted hereunder.

  5. Eligibility. Options may be granted only to Outside Directors. All
Options shall be automatically granted in accordance with the terms set forth
in Section 4 hereof.

  The Plan shall not confer upon any Optionee any right with respect to
continuation of service as a Director or nomination to serve as a Director,
nor shall it interfere in any way with any rights which the Director or the
Company may have to terminate the Director's relationship with the Company at
any time.

  6. Term of Plan. The Plan shall become effective upon the earlier to occur
of its adoption by the Board or its approval by the stockholders of the
Company as described in Section 16 of the Plan. It shall continue in effect
for a term of ten (10) years unless sooner terminated under Section 11 of the
Plan.

  7. Form of Consideration. The consideration to be paid for the Shares to be
issued upon exercise of an Option, including the method of payment, shall
consist of (i) cash, (ii) check, (iii) other shares which (A) in the case of
Shares acquired upon exercise of an Option, have been owned by the Optionee
for more than six (6) months on the date of surrender, and (B) have a Fair
Market Value on the date of surrender equal to the aggregate exercise price of
the Shares as to which said Option shall be exercised, (iv) delivery of a
properly executed exercise notice together with such other documentation as
the Company and the broker, if applicable, shall require to effect an exercise
of the option and delivery to the Company of the sale or loan proceeds
required to pay the exercise price, or (v) any combination of the foregoing
methods of payment.

  8. Exercise of Option.

    (a) Procedure for Exercise; Rights as a Shareholder. Any Option granted
  hereunder shall vest and become exercisable at such times as are set forth
  in Section 4 hereof and pursuant to the Director Option Agreement;
  provided, however, that no Options shall be exercisable until stockholder
  approval of the Plan in accordance with Section 16 hereof has been
  obtained.

    An Option may not be exercised for a fraction of a Share.

    If otherwise exercisable, an Option shall be deemed to be exercised when
  written notice of such exercise has been given to the Company in accordance
  with the terms of the Option by the person entitled to exercise the Option
  and full payment for the Shares with respect to which the Option is
  exercised has been received by the Company. Full payment may consist of any
  consideration and method of payment allowable under Section 7 of the Plan.
  Until the issuance (as evidenced by the appropriate entry on the books of
  the Company or of a duly authorized transfer agent of the Company) of the
  stock certificate evidencing such Shares, no right to vote or receive
  dividends or any other rights as a stockholder shall exist with respect


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  to the Optioned Stock, notwithstanding the exercise of the Option. A share
  certificate for the number of Shares so acquired shall be issued to the
  Optionee as soon as practicable after exercise of the Option. No adjustment
  shall be made for a dividend or other right for which the record date is
  prior to the date the stock certificate is issued, except as provided in
  Section 10 of the Plan.

    Exercise of an Option in any manner shall result in a decrease in the
  number of Shares which thereafter may be available, both for purposes of
  the Plan and for sale under the Option, by the number of Shares as to which
  the Option is exercised.

    (b) Rule 16b-3. Options granted to Outside Directors must comply with the
  applicable provisions of Rule 16b-3 promulgated under the Exchange Act or
  any successor thereto and shall contain such additional conditions or
  restrictions as may be required thereunder to qualify Plan transactions,
  and other transactions by Outside Directors that otherwise could be matched
  with Plan transactions, for the maximum exemption from Section 16 of the
  Exchange Act.

    (c) Termination of Continuous Status as a Director. Subject to Section 10
  hereof, in the event an Optionee's status as a Director terminates other
  than upon the Optionee's death or total and permanent disability (as
  defined in Section 22(e)(3) of the Code), the Optionee shall retain any
  vested portion of this Option (determined in accordance with the terms of
  the Director Option Agreement) and the Optionee (or his or her legal
  representative, as applicable) may exercise his or her Option, but only
  pursuant to the terms of the Director Option Agreement. To the extent that
  the Option was not vested on the date of such termination, and to the
  extent that the Optionee does not exercise such Option (to the extent
  otherwise so entitled) within the time specified pursuant to the Director
  Option Agreement, the Option shall terminate.

    (d) Disability of Optionee. In the event Optionee's status as a Director
  terminates as a result of total and permanent disability (as defined in
  Section 22(e)(3) of the Code), the Optionee shall retain any vested portion
  of his or her Option (determined in accordance with the terms of the
  Director Option Agreement) and the Optionee (or his legal representative,
  as applicable) may exercise his or her Option, but only pursuant to the
  terms of the applicable Director Option Agreement. To the extent that the
  Option was not vested on the date of termination, or if he or she does not
  exercise such Option (to the extent otherwise so entitled) within the time
  specified pursuant to the Director Option Agreement, the Option shall
  terminate.

    (e) Death of Optionee. In the event of an Optionee's death, the
  Optionee's estate or a person who acquired the right to exercise the Option
  by bequest or inheritance shall retain the vested portion of the Option
  (determined in accordance with the terms of the Director Option Agreement)
  and may exercise the Option, but only in accordance with the terms of the
  Director Option Agreement (but in no event later than the expiration of its
  ten (10) year term). To the extent that the Option was not vested on the
  date of death, and to the extent that the Optionee's estate or a person who
  acquired the right to exercise such Option does not exercise such Option
  (to the extent otherwise so entitled) within the time specified in the
  Director Option Agreement, the Option shall terminate.

  9. Non-Transferability of Options. No Option may be sold, pledged, assigned
or transferred in any manner other than by a qualified domestic relations
order as defined by the Code or Title I of the Employee Retirement Income
Security Act of 1974, as amended, or the rules thereunder ("QDRO") or by will
or the laws of descent and distribution unless and until such Option has been
exercised, or the shares underlying such Option have been issued, and all
restrictions applicable to such shares have lapsed; provided, however, an
Optionee may transfer an Option to a Permitted Transferee (as defined below)
to the extent permitted by any applicable law or regulations and subject to
the following terms and conditions:

    (a) An Option transferred to a Permitted Transferee shall not be
  assignable or transferable by the Permitted Transferee other than by a QDRO
  or by will or the laws of descent and distribution.

    (b) Any Option which is transferred to a Permitted Transferee shall
  continue to be subject to all the terms and conditions of the Option as
  applicable to the original holder (other than the ability to further
  transfer the Option).


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    (c) The Optionee and the Permitted Transferee shall execute any and all
  documents reasonably requested by the Board, including without limitation
  documents to (i) confirm the status of the transferee as a Permitted
  Transferee, (ii) satisfy any requirements for an exemption for the transfer
  under applicable federal and state securities laws and (iii) evidence the
  transfer.

    (d) Shares of Common Stock acquired by a Permitted Transferee through
  exercise of an Option have not been registered under the Securities Act of
  1933, as amended, or any state securities act and may not be transferred,
  nor will any assignee or transferee thereof be recognized as an owner of
  such shares of Common Stock for any purpose, unless a registration
  statement under the Securities Act of 1933, as amended, and any applicable
  state securities act with respect to such shares shall then be in effect or
  unless the availability of an exemption from registration with respect to
  any proposed transfer or disposition of such shares shall be established to
  the satisfaction of counsel for the Company.

  As used in this Section 9, "Permitted Transferee" shall mean (i) one or more
of the following family members of an Optionee: spouse, former spouse, child
(whether natural or adopted), stepchild, any other lineal descendant of the
Optionee, (ii) a trust, partnership or other entity established and existing
for the sole benefit of, or under the sole control of the Optionee or one or
more of the above family members of the Optionee, or (iii) any other
transferee specifically approved by the Board after taking into account any
state or federal tax or securities laws applicable to transferable Options.

  No interest or right therein shall be liable for the debts, contracts or
engagements of the holder thereof or his successors in interest or shall be
subject to disposition by transfer, alienation, anticipation, pledge,
encumbrance, assignment or any other means whether such disposition be
voluntary or involuntary or by operation of law by judgment, levy, attachment,
garnishment or any other legal or equitable proceedings (including
bankruptcy), and any attempted disposition thereof shall be null and void and
of no effect, except to the extent that such disposition is permitted by the
preceding provisions of this Section 9. Except as specifically provided in
this Section 9, an Option shall be exercised during the Optionee's lifetime
only by the Optionee or his guardian or legal representative.

  10. Adjustments Upon Changes in Capitalization, Dissolution, Merger or Asset
Sale.

    (a) Changes in Capitalization. Subject to any required action by the
  stockholders of the Company, the number of Shares covered by each
  outstanding Option, the number of Shares which have been authorized for
  issuance under the Plan but as to which no Options have yet been granted or
  which have been returned to the Plan upon cancellation or expiration of an
  Option, as well as the price per Share covered by each such outstanding
  Option, and the number of Shares issuable pursuant to the automatic grant
  provisions of Section 4 hereof shall be proportionately adjusted for any
  increase or decrease in the number of issued Shares resulting from a stock
  split, reverse stock split, stock dividend, combination or reclassification
  of the Common Stock, or any other increase or decrease in the number of
  issued Shares effected without receipt of consideration by the Company;
  provided, however, that conversion of any convertible securities of the
  Company shall not be deemed to have been "effected without receipt of
  consideration." Except as expressly provided herein, no issuance by the
  Company of shares of stock of any class, or securities convertible into
  shares of stock of any class, shall affect, and no adjustment by reason
  thereof shall be made with respect to, the number or price of Shares
  subject to an Option.

    (b) Dissolution or Liquidation. In the event of the proposed dissolution
  or liquidation of the Company, to the extent that an Option has not been
  previously exercised, it shall terminate immediately prior to the
  consummation of such proposed action.

    (c) Merger or Asset Sale. In the event of a merger of the Company with or
  into another corporation or the sale of substantially all of the assets of
  the Company, outstanding Options may be assumed or equivalent options may
  be substituted by the successor corporation or a Parent or Subsidiary
  thereof (the "Successor Corporation"). If an Option is assumed or
  substituted for, the Option or equivalent option shall continue to be
  exercisable as provided in Section 4 hereof for so long as the Optionee
  serves as a Director or a director of the Successor Corporation. Following
  such assumption or substitution, if the Optionee's


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  status as a Director or director of the Successor Corporation, as
  applicable, is terminated other than upon a voluntary resignation by the
  Optionee, the Option or option shall become fully exercisable, including as
  to Shares for which it would not otherwise be exercisable. Thereafter, the
  Option or option shall remain exercisable in accordance with Sections 8(c)
  through (e) above.

  If the Successor Corporation does not assume an outstanding Option or
substitute for it an equivalent option, the Option shall become fully vested
and exercisable, including as to Shares for which it would not otherwise be
exercisable. In such event the Board shall notify the Optionee that the Option
shall be fully exercisable for a period of thirty (30) days from the date of
such notice, and upon the expiration of such period the Option shall
terminate.

  For the purposes of this Section 10(c), an Option shall be considered
assumed if, following the merger or sale of assets, the Option confers the
right to purchase or receive, for each Share of Optioned Stock subject to the
Option immediately prior to the merger or sale of assets, the consideration
(whether stock, cash, or other securities or property) received in the merger
or sale of assets 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 of consideration chosen by the holders of a majority
of the outstanding Shares).

  11. Amendment and Termination of the Plan.

    (a) Amendment and Termination. Except as set forth in Section 4, the
  Board may at any time amend, alter, suspend, or discontinue the Plan, but
  no amendment, alteration, suspension, or discontinuation shall be made
  which would impair the rights of any Optionee under any grant theretofore
  made, without his or her consent. In addition, to the extent necessary and
  desirable to comply with Rule 16b-3 under the Exchange Act (or any
  applicable law or regulation), the Company shall obtain stockholder
  approval of any Plan amendment in such a manner and to such a degree as
  required.

    (b) Effect of Amendment or Termination. Any such amendment or termination
  of the Plan shall not affect Options already granted and such Options shall
  remain in full force and effect as if this Plan had not been amended or
  terminated.

  12. Time of Granting Options. The date of grant of an Option shall, for all
purposes, be the date determined in accordance with Section 4 hereof.

  13. Conditions Upon Issuance of Shares. Shares shall not be issued pursuant
to the exercise of an Option unless the exercise of such Option and the
issuance and delivery of such Shares pursuant thereto shall comply with all
relevant provisions of law, including, without limitation, the Securities Act
of 1933, as amended, the Exchange Act, the rules and regulations promulgated
thereunder, state securities laws, and the requirements of any stock exchange
upon which the Shares may then be listed, and shall be further subject to the
approval of counsel for the Company with respect to such compliance.

  As a condition to the exercise of an Option, the Company may require the
person exercising such Option to represent and warrant at the time of any such
exercise that the Shares are being purchased only for investment and without
any present intention to sell or distribute such Shares, if, in the opinion of
counsel for the Company, such a representation is required by any of the
aforementioned relevant provisions of law.

  Inability of the Company to obtain authority from any regulatory body having
jurisdiction, which authority is deemed by the Company's counsel to be
necessary to the lawful issuance and sale of any Shares hereunder, shall
relieve the Company of any liability in respect of the failure to issue or
sell such Shares as to which such requisite authority shall not have been
obtained.

  14. Reservation of Shares. The Company, during the term of this Plan, will
at all times reserve and keep available such number of Shares as shall be
sufficient to satisfy the requirements of the Plan.



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  15. Option Agreement. Options shall be evidenced by written option agreements
in such form as the Board shall approve.

  16. Stockholder Approval. Continuance of the Plan shall be subject to
approval by the stockholders of the Company at or prior to the first annual
meeting of stockholders held subsequent to the granting of an Option hereunder.
Such shareholder approval shall be obtained in the degree and manner required
under applicable state and federal law.


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               AMENDMENT NO. 1 TO THE 1997 DIRECTOR OPTION PLAN
                         OF MICROSTRATEGY INCORPORATED

  The first sentence of Section 3 of the 1997 Director Option Plan (the
"Plan") of MicroStrategy Corporation is hereby amended and restated in its
entirety, subject to stockholder approval, to provide as follows:

  "Subject to the provisions of Section 10 of the Plan (except as such
provisions relate to stock splits effected prior to February 16, 2000), the
maximum aggregate number of Shares which may be optioned and sold under the
Plan is 600,000 Shares of Common Stock (the "Pool')."

                                          Adopted by the Board of Directors
                                          on February 16, 2000