Exhibit 10(pp)

                             SIGA Technologies, Inc.
    Amended and Restated 1996 Incentive and Non-Qualified Stock Option Plan

1. The Plan

The SIGA Technologies, Inc. 1996 Incentive and Non-Qualified Stock Option Plan
(the "Plan") was initially adopted in 1996. The Plan subsequently was amended in
1998, 1999 and 2000 to increase the number of shares of Company Stock with
respect to which awards may be granted under the Plan. The Plan was amended and
restated in its entirety and renamed the SIGA Technologies, Inc. Amended and
Restated 1996 Incentive and Non-Qualified Stock Option Plan on May 3, 2001, by
the Board of Directors, subject to approval by the stockholders of the Company.
The Plan is hereby further amended and restated, subject to stockholder
approval. The terms of the Plan, as amended and restated, shall apply to all
Options granted after the effective date set forth in Section 24 hereof. The
purposes of the Plan are to attract and retain the best available personnel, to
provide an additional incentive to the employees, consultants and non-employee
directors of SIGA Technologies, Inc., a Delaware corporation (the "Company"),
and to promote the success of the Company's business.

1. Definitions

      As used in the Plan, the following definitions apply to the terms
indicated below:

      (a)   "Affiliate" shall mean an entity (whether or not incorporated),
            controlling, controlled by or under common control with the Company.

      (b)   "Board of Directors" shall mean the Board of Directors of SIGA
            Technologies, Inc.

      (c)   "Cause" shall have the meaning set forth in any employment agreement
            between the Participant and the Company in effect as of the date the
            event giving rise to cause occurred. In the absence of such an
            employment agreement provision, "Cause" shall mean: (a) the
            Participant's conviction of any crime (whether or not involving the
            Company) constituting a felony in the jurisdiction involved; (b)
            conduct of the Participant related to the Participant's employment
            for which either criminal or civil penalties against the Participant
            or the Company may be sought; (c) material violation of the
            Company's policies, including, without limitation, those relating to
            sexual harassment, the disclosure or misuse of confidential
            information, or those set forth in Company manuals or statements of
            policy; (d) serious neglect or misconduct in the performance of the
            Participant's duties for the Company or willful or repeated failure
            or refusal to perform such duties; or (e) any material violation by
            the Participant of the terms of any agreement between the
            Participant and the Company, including, without limitation, any
            employment or non-competition agreement.


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            Any rights the Company may have hereunder in respect of the events
            giving rise to Cause shall be in addition to the rights the Company
            may have under any other agreement with a Participant or at law or
            in equity. Any determination of whether a Participant's employment
            is (or is deemed to have been) terminated for Cause shall be made by
            the Committee in its sole discretion, which determination shall be
            final and binding on all parties. If, subsequent to a Participant's
            termination of employment (whether voluntary or involuntary) without
            Cause, it is discovered that the Participant's employment could have
            been terminated for Cause, such Participant's employment shall be
            deemed to have been terminated for Cause. A Participant's
            termination of employment for Cause shall be effective as of the
            date of the occurrence of the event giving rise to Cause, regardless
            of when the determination of Cause is made.

      (d)   "Code" shall mean the Internal Revenue Code of 1986, as amended.

      (e)   "Committee" shall mean the Committee appointed by the Board of
            Directors to administer the Plan; provided, however, that the
            Committee shall at all times consist of two or more persons, all of
            whom are "non-employee directors" within the meaning of Rule 16b-3
            under the Exchange Act and "outside directors" within the meaning of
            Section 162(m) of the Code. With respect to any matters relating to
            the grant of Options to non-employee members of the Board of
            Directors or to individuals who are not reasonably expected to be
            "covered employees" within the meaning of Section 162(m) of the Code
            at the time the Option is exercised, the Committee may be the entire
            Board of Directors.

      (f)   "Company" shall mean SIGA Technologies, Inc. or any successor
            thereto. References to the Company also shall include the Company's
            Affiliates unless the context clearly indicates otherwise.

      (g)   "Company Stock" shall mean the common stock of the Company, par
            value $0.000l per share.

      (h)   "Disability" shall mean a disability described in Section 422(c)(6)
            of the Code. The existence of a Disability shall be determined by
            the Committee in its absolute discretion.

      (i)   "Exchange Act" shall mean the Securities Exchange Act of 1934, as
            amended from time to time.

      (j)   "Fair Market Value" shall mean, with respect to a share of Company
            Stock on an applicable date:

            (i)   If the principal market for the Company Stock (the "Market")
                  is a national securities exchange or the National Association
                  of Securities Dealers Automated Quotation System ("NASDAQ")
                  National Market, the last sale price or, if no reported sales
                  take place on the applicable date, the average of the high bid
                  and low asked price of Company Stock as reported for such
                  Market on such date or, if no such quotation is made on such
                  date, on the next preceding day on which there were
                  quotations, provided that such


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                  quotations shall have been made within the ten (10) business
                  days preceding the applicable date;

            (ii)  If the Market is the NASDAQ National List, the NASDAQ
                  Supplemental List or another market, the average of the high
                  bid and low asked price for Company Stock on the applicable
                  date, or, if no such quotations shall have been made on such
                  date, on the next preceding day on which there were
                  quotations, provided that such quotations shall have been made
                  within the ten (10) business days preceding the applicable
                  date; or,

            (iii) In the event that neither paragraph (i) nor (ii) shall apply,
                  the Fair Market Value of a share of Company Stock on any day
                  shall be determined in good faith by the Committee in a manner
                  consistently applied.

      (k)   "Incentive Stock Option" shall mean an Option that is an "incentive
            stock option" within the meaning of Section 422 of the Code and that
            is identified as an Incentive Stock Option in the applicable Option
            Agreement.

      (l)   "Non-Qualified Stock Option" shall mean an Option that is not an
            Incentive Stock Option

      (m)  "Option" shall mean an option to purchase shares of Company Stock
            (whether an Incentive Stock Option or a Non-Qualified Stock Option)
            that is granted pursuant to the Plan.

      (n)   "Option Agreement" shall mean an agreement, in such form and
            including such terms as the Committee in its sole discretion shall
            determine, evidencing an Option.

      (o)   "Participant" shall mean an individual who is eligible to
            participate in the Plan pursuant to Section 5 hereof and to whom an
            Option is granted pursuant to the Plan, and, upon his or her death,
            the individual's successors, heirs, executors and administrators, as
            the case may be.

      (p)   "Plan" shall mean this SIGA Technologies, Inc. Amended and Restated
            1996 Incentive and Non-Qualified Stock Option Plan, as it may be
            amended from time to time. Prior to the effective date hereof, the
            Plan was referred to as the SIGA Technologies, Inc. 1996 Incentive
            and Non-Qualified Stock Option Plan and the SIGA Corporation 1996
            Stock Option Plan.

      (q)   "Reload Option" shall mean an Option granted to a Participant in
            accordance with Section 6 hereof upon the exercise of an Option.

      (r)   References in this Plan to a "termination of employment" or to a
            Participant or employee who terminates employment or the like, mean
            the Participant's (i) ceasing to be employed by, or to provide
            consulting or other services for, the Company or any corporation (or
            any of its subsidiaries) which assumes the Participant's award in a
            transaction to which Section 424(a) of the Code applies or (ii)
            ceasing to be a member of the Board of Directors. For purposes of
            the


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            foregoing, if a Participant (a) at the time of reference, is an
            employee, consultant or a member of the Board of Directors, or any
            two of the three relationships, or (b) ceases to be an employee,
            consultant or a member of the Board of Directors and immediately is
            engaged in another of such relationships with the Company, the
            Participant shall not be considered to have terminated employment
            until he ceases the last of such relationships with the Company.

2. Stock Subject to the Plan

      (a) Plan Limit

      Subject to adjustment as provided in Section 9 hereof, the Committee may
grant Options hereunder with respect to shares of Company Stock that in the
aggregate do not exceed 7,500,000 shares. To the extent that any Options
terminate, expire or are cancelled without having been exercised, the shares
covered by such Options shall again be available for grant under the Plan.

      Shares of Company Stock issued under the Plan may be either newly issued
shares or treasury shares, at the discretion of the Committee.

      (b) Individual Limit

      Subject to adjustment as provided in Section 9 hereof, during any calendar
year, the Committee shall not grant any one Participant Options hereunder with
respect to more than 4,900,000 shares of Company Stock, which limit shall
include any shares represented by an Option granted within the same year that
has been cancelled.

3. Administration of the Plan

      The Plan shall be administered by the Committee, provided, however, that
in the absence of the appointment of the Committee or for any other reason
determined by the Board of Directors, the Board of Directors may take any action
under the Plan that would otherwise be the responsibility of the Committee. The
Committee shall from time to time designate the individuals who shall be granted
Options and the amount and type of such Options.

      The Committee shall have fill authority to administer the Plan, including
authority to interpret and construe any provision of the Plan and the terms of
any Option issued under it, correct any defect or supply any omission or
reconcile any inconsistency in the Plan and any Option Agreement, adopt such
rules and regulations for administering the Plan as it may deem necessary or
appropriate, and delegate such administrative responsibilities as it deems
appropriate, provided, however, that the Committee shall retain the
responsibility to designate the Option recipients and the amount and type of
such Options. Decisions of the Committee shall be final and binding on all
parties. The Committee's determinations under the Plan may, but need not, be
uniform and may be made on a Participant-by-Participant basis (whether or not
two or more Participants are similarly situated).

      The Committee may, in its absolute discretion, without amending the Plan,
accelerate the date on which any Option granted under the Plan becomes vested or
otherwise adjust any of the terms of such Option (except that no such adjustment
shall, without the consent of a Participant,

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reduce the Participant's rights under any previously granted and outstanding
Option unless the Committee determines that such adjustment is necessary or
appropriate to prevent such Option from constituting "applicable employee
remuneration" within the meaning of Section 162(m) of the Code).

      Whether an authorized leave of absence, or absence in military or
government service, shall constitute a termination of employment, and the
impact, if any, of any such leave of absence on Options theretofore granted
under the Plan shall be determined by the Committee in its absolute discretion,
subject to applicable law.

      A majority of the Committee shall constitute a quorum at any meeting, and
the acts of a majority of the members present, or acts unanimously approved in
writing by the entire Committee without a meeting, shall be the acts of the
Committee.

      No member of the Committee shall be liable for any action, omission, or
determination relating to the Plan, and the Company shall indemnify and hold
harmless each member of the Committee and each other director or employee of the
Company to whom any duty or power relating to the administration or
interpretation of the Plan has been delegated against any cost or expense
(including counsel fees) or liability (including any sum paid in settlement of a
claim with the approval of the Committee) arising out of any action, omission or
determination relating to the Plan, unless, in either case, such action,
omission or determination was taken or made by such member, director or employee
in bad faith and without reasonable belief that it was in the best interests of
the Company.

4. Eligibility

      The persons who shall be eligible to receive Options pursuant to the Plan
shall be (i) officers and salaried employees of the Company and its subsidiaries
(including employees who are also directors and prospective salaried employees
conditioned on their becoming salaried employees), (ii) members of the Board of
Directors (whether or not they also are employees of the Company), (iii) such
consultants to the Company and its subsidiaries as the Committee shall select in
its discretion, and (iv) any other key persons, as determined by the Committee
in its sole discretion, provided, however, that Incentive Stock Options only may
be granted to employees of the Company. For purposes of the preceding sentence,
an employee means an individual who is (or is expected to be) classified as an
employee of the Company for purposes of the Company's payroll. A director shall
not be considered an employee of the Company as a result of the Company's
payment of a director's fee.

5. Options

      The Committee may grant Options pursuant to the Plan. Each Option shall be
evidenced by an Option Agreement in such form and including such terms as the
Committee shall from time to time approve. Options shall comply with and be
subject to the following terms and conditions:

      (a) Identification of Options


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      Each Option granted under the Plan shall be clearly identified in the
applicable Option Agreement as either an Incentive Stock Option or as a
Non-Qualified Stock Option. In the absence of such identification, an Option
shall be deemed to be a Non-Qualified Stock Option.

      (b) Exercise Price

      The exercise price-per-share of any Non-Qualified Stock Option granted
under the Plan shall be such price as the Committee shall determine (which may
be equal to, less than or greater than the then Fair Market Value of a share of
Company Stock) on the date on which such Non-Qualified Stock Option is granted;
provided, that such price may not be less than the minimum price required by
law. Subject to Paragraph (d) of this Section 6, the exercise price-per-share of
any Incentive Stock Option granted under the Plan shall be not less than 100% of
the Fair Market Value of a share of Company Stock on the date on which such
Incentive Stock Option is granted (except as permitted in connection with the
assumption or issuance of Options in a transaction to which Section 424(a) of
the Code applies) and, to the extent any compensation payable in respect of an
Option is intended to qualify as performance-based compensation under Section
162(m)(4)(C) of the Code, the exercise price-per-share of such Option shall be
not less than 100% of the Fair Market Value of a share of Company Stock on the
date on which such Option is granted.

      (c) Term and Exercise of Options

            (1)   Each Option shall be exercisable at such times and under such
                  conditions as determined by the Committee and set forth in the
                  applicable Option Agreement, including performance criteria
                  with respect to the Company and/or the Participant. Except as
                  provided in Section 7 hereof, an Option shall first be
                  exercisable as of the date on which it vests, and shall remain
                  exercisable until the expiration of ten (10) years from the
                  date such Option was granted; provided, however, that each
                  Option shall be subject to earlier termination, expiration or
                  cancellation as provided in the Plan.

            (2)   Each Option shall be exercisable in whole or in part. The
                  partial exercise of an Option shall not cause the expiration,
                  termination or cancellation of the remaining portion thereof.
                  Upon the partial exercise of an Option, the Option Agreement
                  evidencing such Option shall be returned to the Participant
                  exercising such Option together with the delivery of the
                  certificates described in Section 6(c)(4) hereof.

            (3)   An Option shall be exercised by delivering notice to the
                  Company's principal office, to the attention of its Secretary,
                  at such time as the Committee reasonably may require. Such
                  notice shall be accompanied by the Option Agreement evidencing
                  the Option, shall specify the number of shares of Company
                  Stock with respect to which the Option is being exercised and
                  the effective date of the proposed exercise and shall be
                  signed by the Participant. The Participant may withdraw such
                  notice at any time prior to the close of business on the
                  business day immediately preceding the effective date of the
                  proposed exercise, in which case such Option Agreement shall
                  be returned to him. Payment for shares of


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                  Company Stock purchased upon the exercise of an Option shall
                  be made on the effective date of such exercise either:

                  (i)   in cash, by certified check, bank cashier's check or
                        wire transfer; or

                  (ii)  unless provided otherwise in the applicable Option
                        Agreement, in shares of Company Stock owned by the
                        Participant (which, if acquired pursuant to the exercise
                        of a stock option, were acquired at least six months
                        prior to the option exercise date) and valued at their
                        Fair Market Value on the effective date of such
                        exercise, or partly in shares of Company Stock with the
                        balance in cash, by certified check, bank cashier's
                        check or wire transfer; or

                  (iii) unless provided otherwise in the applicable Option
                        Agreement, pursuant to procedures adopted by the
                        Committee whereby the Participant, by a properly written
                        notice, shall direct (A) an immediate market sale or
                        margin loan respecting all or a part of the shares of
                        Company Stock to which the Participant is entitled upon
                        exercise pursuant to an extension of credit by the
                        Company to the Participant of the exercise price (B) the
                        delivery of the shares of Company Stock from the Company
                        directly to the brokerage firm, and (C) the delivery of
                        the exercise price from the sale or margin loan proceeds
                        from the brokerage firm directly to the Company.

                  (iv)  at the discretion of the Committee and to the extent
                        permitted by law, by such other provision as the
                        Committee may from time to time prescribe.

                  (v)   In addition, the Company may, in its sole discretion and
                        at the request of the Participant, (A) lend to the
                        Participant, with full recourse, an amount equal to such
                        portion of the payment for the shares of Company Stock
                        pursuant to the Option as the Committee may determine;
                        or (B) guarantee a loan obtained by the Participant from
                        a third-party for the purpose of tendering such payment.

Any payment in shares of Company Stock shall be effected by the delivery of such
shares to the Secretary of the Company, duly endorsed in blank or accompanied by
stock powers duly executed in blank, together with any other documents and
evidences as the Secretary of the Company shall require from time to time.

            (4)   Certificates for shares of Company Stock purchased upon the
                  exercise of an Option shall be issued in the name of the
                  Participant or his or her beneficiary (or permitted
                  transferee), as the case may be, and delivered to the
                  Participant or his or her beneficiary (or permitted
                  transferee), as the case may be, as soon as practicable
                  following the effective date on which the Option is exercised.

      (d) Limitations on Grant of Incentive Stock Options


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            (1)   To the extent that the aggregate Fair Market Value (determined
                  as of the time the option is granted) of the stock with
                  respect to which Incentive Stock Options granted under this
                  Plan and all other plans of the Company (and any plans of any
                  "subsidiary corporation" or "parent corporation" of the
                  Company within the meaning of Section 424 of the Code) are
                  first exercisable by any employee during any calendar year
                  shall exceed the maximum limit (currently, $100,000), if any,
                  imposed from time to time under Section 422 of the Code, such
                  options shall be treated as Non-Qualified Stock Options. In
                  such an event, the determination of which Options shall remain
                  Incentive Stock Options and which shall be treated as
                  Non-Qualified Stock Options shall be based on the order in
                  which such Options were granted, with the excess over the
                  first $100,000 granted deemed to be Non-Qualified Stock
                  Options. All other terms and provisions of such Options that
                  are deemed to be Non-Qualified Stock Options shall remain~
                  unchanged. Upon the exercise of an Option that, pursuant to
                  this Section 6(d)(1) is treated in part as an Incentive Stock
                  Option and in part as a Non-Qualified Stock Option, the
                  Company shall issue separate stock certificates evidencing the
                  shares of Company Stock treated as acquired upon exercise of
                  an Incentive Stock Option and the shares of Company Stock
                  treated as acquired upon exercise of a Non-Qualified Stock
                  Option and shall identify each such certificate accordingly in
                  its stock transfer records.

            (2)   No Incentive Stock Option may be granted to an individual if,
                  at the time of the proposed grant, such individual owns stock
                  possessing more than ten percent (10%) of the total combined
                  voting power of all classes of stock of the Company or any of
                  its "subsidiary corporations" or "parent corporations" (within
                  the meaning of Section 424 of the Code), unless (i) the
                  exercise price of such Incentive Stock Option is at least one
                  hundred ten percent (110%) of the Fair Market Value of a share
                  of Company Stock at the time such Incentive Stock Option is
                  granted and (ii) such Incentive Stock Option is not
                  exercisable after the expiration of five years from the date
                  such Incentive Stock Option is granted.

      (e) Grants of Reload Options

      If provided in the applicable Option Agreement, an additional option (the
"Reload Option") shall be granted to any Participant who, pursuant to Section
6(c)(3)(ii), delivers shares of Company Stock in partial or full payment of the
exercise price of an Option (the "Original Option"). The Reload Option shall be
for a number of shares of Company Stock equal to the number thus delivered,
shall have an exercise price equal to the Fair Market Value of a share of
Company Stock on the date of exercise of the Original Option, and shall have an
expiration date no later than the expiration date of the Original Option. A
Reload Option only may be granted if the exercise price-per-share of the
Original Option is no less than the Fair Market Value of a share of Company
Stock on its date of grant.

      (f) Effect of Termination of Employment


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            (1)   Unless otherwise provided in an applicable Option Agreement,
                  in the event that the employment of a Participant with the
                  Company shall terminate for any reason other than Cause,
                  Disability or death (i) Options granted to such Participant,
                  to the extent that they were vested at the time of such
                  termination, shall remain exercisable until the expiration of
                  90 days after such termination, on which date they shall
                  expire, and (ii) Options granted to such Participant, to the
                  extent that they were not vested at the time of such
                  termination, shall expire at the close of business on the date
                  of such termination; provided, however, that no Option shall
                  be exercisable after the expiration of its term.

            (2)   Unless otherwise provided in an applicable Option Agreement,
                  in the event that the employment of a Participant with the
                  Company shall terminate on account of the death or Disability
                  of the Participant (i) Options granted to such Participant, to
                  the extent that they were vested at the time of such
                  termination, shall remain exercisable (pursuant to Section 16
                  hereof) until the expiration of one year after such
                  termination, on which date they shall expire, and (ii) Options
                  granted to such Participant, to the extent that they were not
                  vested at the time of such termination, shall expire at the
                  close of business on the date of such termination; provided.
                  however, that no Option shall be exercisable after the
                  expiration of its term.

            (3)   Unless otherwise provided in an applicable Option Agreement,
                  in the event of the termination of a Participant's employment
                  for Cause, all outstanding Options granted to such Participant
                  shall expire at the commencement of business on the effective
                  date of such termination (or deemed termination in accordance
                  with Section 2(c)).

      (g) Other Option Grants.

      The Committee, in its discretion, may grant Options with terms different
than those set forth herein to the extent such Options are in substitution for
and have terms equivalent to options granted by another company that was merged
into or acquired by the Company or an Affiliate or whose assets or substantially
all of whose assets were acquired by the Company or an Affiliate.

6. Pre-Vesting Exercise

      (a) Pre-Vesting Exercise

      The Committee, in an Option Agreement, may permit a Participant to
exercise an Option prior to the date on which it vests; provided, however, the
unvested portion of the Company Stock issuable upon exercise of such Option
shall be subject to the nontransferability, forfeiture and repayment provisions
of this Section 7 until such shares vest.

      (b) Restrictions on Transferability


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      Until a share of Company Stock vests, the Participant may not transfer or
assign the Participant's rights to such share of Company Stock or to any cash
payment related thereto. Until a share of Company Stock so vests, no attempt to
transfer or assign such shares or the right to any cash payment related thereto,
whether by transfer, pledge, hypothecation or otherwise and whether voluntary or
involuntary, by operation of law or otherwise, shall vest the transferee or
assignee with any interest or right in or with respect to such share of Company
Stock or such cash payment, and the attempted transfer or assignment shall be of
no force and effect.

      Each such certificate that is issued pursuant to this Section 7 shall bear
the following legend, in addition to any legends or restrictions imposed
pursuant to Section 12 hereof:

            "The transferability of this certificate and the shares of stock
            represented hereby are subject to the restrictions, terms and
            conditions (including forfeiture and restrictions against transfer)
            contained in the SIGA Technologies, Inc. Amended and Restated 1996
            Incentive and Non-Qualified Stock Option Plan and an Agreement
            entered into between the registered owner of such shares and SIGA
            Technologies, Inc. A copy of the Plan and Agreement is on file in
            the office of the Secretary of SIGA Technologies, Inc."

      Such legend shall not be removed from the certificates evidencing such
exercised shares of Company Stock until such shares vest, at which time stock
certificates shall be issued pursuant to Section 12 hereof free of such legend.

      Each such stock certificate, together with the stock powers relating to
such shares of Company Stock, shall be deposited by the Company with a custodian
designated by the Company (the "Certificate Custodian"). The Company may
designate itself as Certificate Custodian hereunder. The Company shall cause
such Certificate Custodian to issue to the Participant a receipt evidencing the
certificates that are registered in the name of the Participant and are held by
the Certificate Custodian.

      (c) Dividends

      Unless the Committee in its absolute discretion otherwise determines, any
securities or other property (including dividends paid in cash) received by a
Participant with respect to a share of Company Stock issued pursuant to this
Section 7, as a result of any dividend, stock split, reverse stock split,
recapitalization, merger, consolidation, combination, exchange of shares or
otherwise, will not vest until such share of Company Stock vests, and shall be
promptly deposited with the Certificate Custodian designated pursuant to Section
7(b) hereof until such share vests, at which time such property shall be
delivered to the Participant. Any such cash dividends, prior to the date the
share vests, shall be merely an unfunded, unsecured promise of the Company to
pay a sum of money to the Participant in the future.

      (d) Forfeiture and Repayment

      Upon termination of a Participant's employment with the Company or an
Affiliate for any reason (including death), all unvested shares of Company Stock
exercised pursuant to any Option hereunder shall be immediately and irrevocably
forfeited. In the event of any such


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forfeiture, the Certificate Custodian shall surrender to the Company as soon as
practicable after the effective date of such forfeiture all certificates for
such shares issued to Participant by the Company. As soon as practicable after
such surrender, but in no event later than 30 days after such surrender,
Participant shall be entitled to a payment by the Company in an amount, in cash
equal to the aggregate of the exercise price-per-share paid for each exercised
but unvested share of Company Stock so forfeited.

7. Right of Recapture

      If at any time within one year after the date on which a Participant
exercises an Option, the Committee determines in its discretion that the Company
has been materially harmed by the Participant, whether such harm (a) results in
the Participant's termination or deemed termination of employment for Cause or
(b) results from any activity of the Participant determined by the Committee to
be in competition with any activity of the Company, or otherwise inimical,
contrary or harmful to the interests of the Company (including, but not limited
to, accepting employment with or serving as a consultant, adviser or in any
other capacity to an entity that is in competition with or acting against the
interests of the Company), then any gain realized by the Participant from such
exercise shall be paid by the Participant to the Company upon notice from the
Company. Such gain shall be determined as of the date of such exercise, without
regard to any subsequent change in the Fair Market Value of a share of Company
Stock. The Company shall have the right to offset such gain against any amounts
otherwise owed to the Participant by the Company (whether as wages, vacation
pay, or pursuant to any benefit plan or other compensatory arrangement).

8. Adjustment Upon Changes in Company Stock

      (a) Shares Available for Grants

      Subject to any required action by the stockholders of the Company, in the
event of any change in the number of shares of Company Stock outstanding by
reason of any stock dividend or split, reverse stock split, recapitalization,
merger, consolidation, combination or exchange of shares or similar corporate
change, the maximum number of shares of Company Stock with respect to which the
Committee may grant Options under Section 3 hereof shall be appropriately
adjusted by the Committee. In the event of any change in the number of shares of
Company Stock outstanding by reason of any other event or transaction, the
Committee may, but need not, make such adjustments in the number and class of
shares of Company Stock with respect to which Options may be granted under
Section 3 hereof as the Committee may deem appropriate. Any such adjustment
pursuant to this Section 9(a) shall be made by the Committee, whose
determination shall be final, binding and conclusive.

      (b) Outstanding Options -- Increase or Decrease in Issued Shares Without
Consideration

      Subject to any required action by the stockholders of the Company, in the
event of any increase or decrease in the number of issued shares of Company
Stock resulting from a subdivision or consolidation of shares of Company Stock
or the payment of a stock dividend (but only on the shares of Company Stock), or
any other increase or decrease in the number of such shares effected without
receipt of consideration by the Company, the Committee shall


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proportionally adjust the number of shares of Company Stock subject to each
outstanding Option and the exercise price-per-share of Company Stock of each
such Option. Any such adjustment pursuant to this Section 9(b) shall be made by
the Committee, whose determination shall be final, binding and conclusive.

      (c) Outstanding Options -- Certain Mergers

      Subject to any required action by the stockholders of the Company, in the
event that the Company shall be the surviving corporation in any merger or
consolidation (except a merger or consolidation as a result of which the holders
of shares of Company Stock receive securities of another corporation), each
Option outstanding on the date of such merger or consolidation shall pertain to
and apply to the securities which a holder of the number of shares of Company
Stock subject to such Option would have received in such merger or
consolidation.

      (d) Outstanding Options -- Certain Other Transactions

      In the event of (1) a dissolution or liquidation of the Company, (2) a
sale of all or substantially all of the Company's assets, (3) a merger or
consolidation involving the Company in which the Company is not the surviving
corporation or (4) a merger or consolidation involving the Company in which the
Company is the surviving corporation but the holders of shares of Company Stock
receive securities of another corporation and/or other property, including cash,
the Committee shall, in its absolute discretion, have the power to:

            (i)   cancel, effective immediately prior to the occurrence of such
                  event, each Option outstanding immediately prior to such event
                  (whether or not then vested), and, in full consideration of
                  such cancellation, pay to the Participant to whom such Option
                  was granted an amount in cash, for each share of Company Stock
                  subject to such Option equal to the excess of (A) the value,
                  as determined by the Committee in its absolute discretion, of
                  the property (including cash) received by the holder of a
                  share of Company Stock as a result of such event over (B) the
                  exercise price of such Option; or

            (ii)  provide for the exchange of each Option outstanding
                  immediately prior to such event (whether or not then vested)
                  for an option on some or all of the property which a holder of
                  the number of shares of Company Stock subject to such Option
                  would have received in such transaction or on shares of the
                  acquiror or surviving corporation and, incident thereto, make
                  an equitable adjustment as determined by the Committee in its
                  absolute discretion in the exercise price of the Option, or
                  the number of shares or amount of property subject to the
                  Option or, if appropriate, provide for a cash payment to the
                  Participant to whom such Option was granted in partial
                  consideration for the exchange of the Option.

      (e) Outstanding Options -- Other Changes

       In the event of any change in the capitalization of the Company or a
corporate change other than those specifically referred to in Sections 9(b), (c)
or (d) hereof, the Committee may, in its absolute discretion, make such
adjustments in the number and class of shares subject to


                                       12
<PAGE>

Options outstanding on the date on which such change occurs and in the per-share
exercise price of each such Option as the Committee may consider appropriate to
prevent dilution or enlargement of rights. In addition, if and to the extent the
Committee determines it is appropriate, the Committee may elect to cancel each
Option outstanding immediately prior to such event (whether or not then vested),
and, in full consideration of such cancellation, pay to the Participant to whom
such Option was granted an amount in cash, for each share of Company Stock
subject to such Option, equal to the excess of (A) the Fair Market Value of
Company Stock on the date of such cancellation over (B) the exercise price of
such Option.

      (f) Effect of Loss of Affiliate Status

      If an entity ceases to be an Affiliate because the Company sells its
interest in such entity to another party or parties, such event shall constitute
a termination of employment from the Company and its Affiliates by Participants
employed by such entity as of the date it ceases to be an Affiliate. The
Committee may, but need not, adjust the provisions of the Plan related to the
expiration of any Options not yet vested at termination of employment, as it
considers appropriate in connection with the specific event resulting in loss of
Affiliate status.

      (g) No Other Rights

      Except as expressly provided in the Plan, no Participant shall have any
rights by reason of any subdivision or consolidation of shares of stock of any
class, the payment of any dividend, any increase or decrease in the number of
shares of stock of any class or any dissolution, liquidation, merger or
consolidation of the Company or any other corporation. Except as expressly
provided in the Plan, 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 of shares of Company Stock subject to an Option or the exercise price of
any Option.

9. Rights as a Stockholder

      No person shall have any rights as a stockholder with respect to any
shares of Company Stock covered by or relating to any Option granted pursuant to
this Plan until the date that the Participant becomes the registered owner of
such shares. Except as otherwise expressly provided in Section 9 hereof, no
adjustment to any Option shall be made for dividends or other rights for which
the record date occurs prior to the date such stock certificate is issued.

10. No Special Employment Rights; No Right to Option

      Nothing contained in the Plan or any Option Agreement shall confer upon
any Participant any right with respect to the continuation of his or her
employment by or other relationship with the Company or interfere in any way
with the right of the Company, subject to the terms of any separate employment
agreement to the contrary, at any time to terminate such employment or to
increase or decrease the compensation of the Participant from the rate in
existence at the time of the grant of an Option.

      No person shall have any claim or right to receive an Option hereunder.
The Committee's granting of an Option to a Participant at any time shall neither
require the Committee to grant an Option to such Participant or any other
Participant or other person at any


                                       13
<PAGE>

time nor preclude the Committee from making subsequent grants to such
Participant or any other Participant or other person.

11. Securities Matters

      (a)   The Company shall be under no obligation to effect the registration
            pursuant to the Securities Act of 1933, as amended from time to
            time, of any interests in the Plan or any shares of Company Stock to
            be issued hereunder or to effect similar compliance under any state
            laws. Notwithstanding anything herein to the contrary, the Company
            shall not be obligated to cause to be issued or delivered any
            certificates evidencing shares of Company Stock pursuant to the Plan
            unless and until the Company is advised by its counsel that the
            issuance and delivery of such certificates is in compliance with all
            applicable laws, regulations of governmental authority and the
            requirements of any securities exchange on which shares of Company
            Stock are traded. The Committee may require, as a condition of the
            issuance and delivery of certificates evidencing shares of Company
            Stock pursuant to the terms hereof, that the recipient of such
            shares make such covenants, agreements and representations, and that
            such certificates bear such legends, as the Committee, in its sole
            discretion, deems necessary or desirable. The Company shall not
            permit any shares of Company Stock to be issued pursuant to the Plan
            unless such shares of Company Stock are fully paid and
            non-assessable, within the meaning of Section 152 of the Delaware
            General Corporation Law, except as otherwise permitted by Section
            153(c) of the Delaware General Corporation Law.

      (b)   The exercise of any Option granted hereunder shall be effective only
            at such time as counsel to the Company shall have determined that
            the issuance and delivery of shares of Company Stock pursuant to
            such exercise is in compliance with all applicable laws, regulations
            of governmental authority and the requirements of any securities
            exchange on which shares of Company Stock are traded. The Committee
            may, in its sole discretion, defer the effectiveness of any exercise
            of an Option granted hereunder in order to allow the issuance of
            shares of Company Stock pursuant thereto to be made pursuant to
            registration or an exemption from registration or other methods for
            compliance available under federal or state securities laws. The
            Committee shall inform the Participant in writing of its decision to
            defer the effectiveness of the exercise of an Option granted
            hereunder. During the period that the effectiveness of the exercise
            of an Option has been deferred, the Participant may, by written
            notice, withdraw such exercise and obtain a refund of any amount
            paid with respect thereto.

12. Withholding Taxes

      (a)   Cash Remittance

      Whenever shares of Company Stock are to be issued upon the exercise of an
Option, the Company shall have the right to require the Participant to remit to
the Company, in cash, an amount sufficient to satisfy the federal, state and
local withholding tax requirements, if any, attributable to such exercise prior
to the delivery of any certificate or certificates for such shares.


                                       14
<PAGE>

      (b) Stock Remittance

      At the election of the Participant, subject to the approval of the
Committee, when shares of Company Stock are to be issued upon the exercise of an
Option, in lieu of the remittance required by Section 13(a) hereof, the
Participant may tender to the Company a number of shares of Company Stock, the
Fair Market Value of which at the tender date the Committee determines to be
sufficient to satisfy the federal, state and local withholding tax requirements,
if any, attributable to such exercise and not greater than the Participant's
estimated total federal, state and local tax obligations associated with such
exercise.

      (c) Stock Withholding

      The Company shall have the right, when shares of Company Stock are to be
issued upon the exercise of an Option in lieu of requiring the remittance
required by Section 13(a) hereof, to withhold a number of such shares, the Fair
Market Value of which at the exercise date the Committee determines to be
sufficient to satisfy the federal, state and local withholding tax requirements,
if any, attributable to such exercise and is not greater than the Participant's
estimated total federal, state and local tax obligations associated with such
exercise.

13. Amendment or Termination of the Plan

      The Board of Directors may, at any time, suspend or discontinue the Plan
or revise or amend it in any respect whatsoever; provided, however, that if and
to the extent required under Section 422 of the Code (if and to the extent that
the Board of Directors deems it appropriate to comply with Section 422) and if
and to the extent required to treat some or all of the Options as
"performance-based compensation" within the meaning of Section 162(m) of the
Code (if and to the extent that the Board of Directors deems it appropriate to
meet such requirements), no amendment shall be effective without the approval of
the stockholders of the Company, that (i) except as provided in Section 9
hereof, increases the number of shares of Company Stock with respect to which
Options may be issued under the Plan, (ii) modifies the class of individuals
eligible to participate in the Plan or (iii) materially increases the benefits
accruing to individuals pursuant to the Plan. Nothing herein shall restrict the
Committee's ability to exercise its discretionary authority hereunder pursuant
to Section 4 hereof, which discretion may be exercised without amendment to the
Plan. No action under this Section 14 may, without the consent of a Participant,
reduce the Participant's rights under any previously granted and outstanding
Option except to the extent that the Board of Directors determines that such
amendment is necessary or appropriate to prevent such Options from constituting
"applicable employee remuneration" within the meaning of Section 162(m) of the
Code.

14. No Obligation to Exercise

      The grant to a Participant of an Option shall impose no obligation upon
such Participant to exercise such Option.


                                       15
<PAGE>

15. Transferability of Options

      (a)   Except as otherwise provided in this Section 16, during the lifetime
            of a Participant each Option granted to a Participant shall be
            exercisable only by the Participant and no Option shall be
            assignable or transferable otherwise than by will or by the laws of
            descent and distribution.

      (b)   Upon the death of a Participant, outstanding Options granted to such
            Participant that have not been transferred pursuant to Section 16(a)
            hereof may be exercised only by the executors or administrators of
            the Participant's estate or by any person or persons who shall have
            acquired such right to exercise by will or by the laws of descent
            and distribution. No transfer by will or the laws of descent and
            distribution of any Option, or the right to exercise any Option,
            shall be effective to bind the Company unless the Committee shall
            have been furnished with written notice thereof and with a copy of
            the will and/or such evidence as the Committee may deem necessary to
            establish the validity of the transfer.

      (c)   Any permissible transfer of an Option only shall be effective after
            the Committee shall have been furnished with an agreement by the
            transferee to comply with all the terms and conditions of the Option
            that are or would have been applicable to the Participant and to be
            bound by the acknowledgments made by the Participant in connection
            with the grant of the Option.

      (d)   In the event that at any time any doubt exists as to the right of
            any person to exercise or receive a payment under an Option, the
            Committee shall be entitled, in its discretion, to delay such
            exercise or payment until it is satisfied that such right has been
            confirmed (which may, but need not be, by order of a court of
            competent jurisdiction), or to permit such exercise or make payment
            only upon receipt of a bond or similar indemnification (in such
            amount and in such form as is satisfactory to the Committee).

16. Expenses and Receipts

      The expenses of the Plan shall be paid by the Company. Any proceeds
received by the Company in connection with any Option will be used for general
corporate purposes.

17. Limitations Imposed by Section 162(m)

      Notwithstanding any other provision hereunder, if and to the extent that
the Committee determines the Company's federal tax deduction in respect of an
Option may be limited as a result of Section 162(m) of the Code, the Committee
may delay the payment in respect of such Option until a date that is within 30
days after the date that compensation paid to the Participant no longer is
subject to the deduction limitation under Section 162(m) of the Code. In the
event that a Participant exercises an Option at a time when the Participant is
a "covered employee," and the Committee determines to delay the payment in
respect of any such Option, the Committee shall credit cash or, in the case of
an amount payable in Company Stock, the Fair Market Value of the Company Stock,
payable to the Participant to a book account. The Participant shall have no
rights in respect of such book account and the amount credited thereto shall not
be transferable by the Participant other than by will or laws of descent and
distribution.


                                       16
<PAGE>

The Committee may credit additional amounts to such book account as it may
determine in its sole discretion. Any book account created hereunder shall
represent only an unfunded unsecured promise by the Company to pay the amount
credited thereto to the Participant in the future.

18. Mitigation of Excise Tax

      If any payment or right accruing to a Participant under this Plan (without
the application of this Section), either alone or together with other payments
or rights accruing to the Participant from the Company or an affiliate ("Total
Payments") would constitute a "parachute payment" (as defined in Section 280G of
the Code and regulations thereunder), the Committee may in each particular
instance determine to (i) reduce such payment or right to the largest amount or
greatest right that will result in no portion of the amount payable or right
accruing under the Plan being subject to an excise tax under Section 4999 of the
Code or being disallowed as a deduction under Section 280G of the Code, or (ii)
take such other actions, or make such other arrangements or payments with
respect to any such payment or right as the Committee may determine in the
circumstances. Any such determination shall be made by the Committee in the
exercise of its sole discretion, and such determination shall be conclusive and
binding on the Participant. The Participant shall cooperate as may be requested
by the Committee in connection with the Committee's determination, including
providing the Committee with such information concerning such Participant as the
Committee may deem relevant to its determination.

19. Participant Obligation to Notify

      In the event that the Participant (a) disposes of any shares of Company
Stock acquired upon the exercise of an Incentive Stock Option (i) prior to the
expiration of two years after the date such Incentive Stock Option was granted
or prior to one year after the date the shares were acquired or (ii) under any
other circumstances described in Section 422(a) of the Code or any successor
provision, or (b) makes an election under Section 83(b) of the Code or any
successor provision, with respect to Company Stock acquired pursuant to Section
7 hereof, the Participant shall notify the Company of such disposition or
election within 10 days thereof

20. Information to Participants

      To the extent required by applicable law, the Company shall provide to
each Participant, during the period for which such Participant has one or more
Options outstanding, copies of all annual reports and other information which
are provided to all stockholders of the Company. Except as otherwise noted in
the foregoing sentence, the Company shall have no obligation or duty to
affirmatively disclose to any Participant, and no Participant shall have any
right to be advised of, any material information regarding the Company or any
Affiliate at any time prior to, upon or otherwise in connection with, the
exercise of an Option.

21. Funding

      All benefits payable under this Plan shall be paid directly by the
Company. The Company shall not be required to fund or otherwise segregate assets
to be used for payment of benefits under this Plan.


                                       17
<PAGE>

22. Failure to Comply

      In addition to the remedies of the Company elsewhere provided for herein,
a failure by a Participant (or beneficiary or permitted transferee) to comply
with any of the terms and conditions of the Plan or the agreement executed by
such Participant (or beneficiary or permitted transferee) evidencing an Option,
unless such failure is remedied by such Participant (or beneficiary or permitted
transferee) within 10 days after having been notified of such failure by the
Committee, shall be grounds for the cancellation and forfeiture of such Option,
in whole or in part, as the Committee, in its absolute discretion, may
determine.

23. Effective Date of Plan

      The Plan was initially adopted by the Board of Directors in 1996 and was
approved by shareholders of the Company. The Plan was subsequently amended in
1998, 1999 and 2000 to increase the number of shares with respect to which
Options may be granted under the Plan and each of the amendments was approved by
the shareholders of the Company. An amendment and restatement to the Plan was
approved by the Board of Directors, on May 3, 2001, subject to approval by the
stockholders of the Company, and the Plan as further amended and restated was
approved by the Board of Directors, as of June 29, 2001, subject to approval by
the stockholders of the Company. Options that were not previously authorized by
the stockholders of the Company under the provisions of the Plan as in effect
prior to May 3, 2001 that have not yet been approved by the stockholders may be
granted under the Plan at any time prior to the receipt of such stockholder
approval; provided, however, that each such grant shall be subject to such
approval. Without limitation on the foregoing, no Option may be exercised prior
to the receipt of such approval. If the amended and restated Plan is not so
approved on or before May 3, 2002, then the May 3, 2001 and the June 29, 2001
amendments and restatements of the Plan and all Options granted pursuant to such
amendments and restatements shall forthwith automatically terminate and be of no
force or effect.

24. Term of the Plan

      The right to grant Options under the Plan will terminate on January 1,
2006 with respect to the 2,500,000 shares of Company Stock authorized under the
provisions of the Plan in effect prior to this amendment and restatement, and on
May 3, 2011 with respect to the additional 5,000,000 shares of Company Stock
authorized pursuant to the May 3, 2001 amendment and restatement.

25. Applicable Law

      Except to the extent preempted by any applicable federal law, the Plan
will be construed and administered in accordance with the laws of the State of
Delaware, without reference to the principles of conflicts of law.

26. Severability

      If any provision of the Plan shall hereafter be held to be invalid,
unenforceable or illegal in whole or in part, in any jurisdiction under any
circumstances for any reason, (a) such provision shall be reformed to the
minimum extent necessary to cause such provision to be valid, enforceable and
legal while preserving the intent expressed by the Plan or (b) if such provision


                                       18
<PAGE>

cannot be so reformed, such provision shall be severed from the Plan and, in the
discretion of the Committee, an equitable adjustment shall be made to the Plan
(including, without limitation, addition of necessary further provisions to the
Plan) so as to give effect to the intent as so expressed and the benefits so
provided. Such holding shall not affect or impair the validity, enforceability
or legality of such provision in any other jurisdiction or under any other
circumstances. Neither such holding nor such reformation or severance shall
affect or impair the legality, validity or enforceability of any other provision
of the Plan.


                                       19