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                                                                    Exhibit 10.1





                        NEOGENESIS PHARMACEUTICALS, INC.

                             1997 STOCK OPTION PLAN
                       (as amended as of November 9, 2001)













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             NEOGENESIS PHARMACEUTICALS, INC. 1997 STOCK OPTION PLAN

                      (as amended as of November 9, 2001)

                                TABLE OF CONTENTS


<TABLE>
<CAPTION>
                                                                                  PAGE
<S> <C>                                                                          <C>
1.  Purpose..........................................................................1

2.  Administration of the Plan.......................................................1

3.  Option Shares....................................................................1

4.  Authority to Grant Options.......................................................2

5.  Written Agreement................................................................2

6.  Eligibility......................................................................3

7.  Option Price.....................................................................3

8.  Duration of Options..............................................................4

9.  Restriction on Exercise of Options...............................................4

10. Exercise of Options..............................................................5

11. Nontransferability of Options....................................................6

12. Termination of Employment or Involvement of Optionee with the Company............7

13. Requirements of Law..............................................................8

14. No Rights as Stockholder.........................................................9

15. Employment Obligation............................................................9

16. Forfeiture as a Result of Termination For Cause..................................9

17. Changes in the Company's Capital Structure......................................10

18. Amendment or Termination of the Plan............................................12

19. Effective Date and Duration of the Plan.........................................12
</TABLE>

<PAGE>


             NEOGENESIS PHARMACEUTICALS, INC. 1997 STOCK OPTION PLAN
                       (AS AMENDED AS OF NOVEMBER 9, 2001)

     1. PURPOSE

     The purpose of this NeoGenesis Pharmaceuticals, Inc. 1997 Stock Option
Plan, as amended to date (the "PLAN") is to encourage directors, consultants and
key employees of NeoGenesis Pharmaceuticals, Inc. (the "COMPANY") and its
Subsidiaries (as hereinafter defined) to continue their association with the
Company, by providing favorable opportunities for such persons to participate in
the ownership of the Company and in its future growth through the granting of
stock options (the "OPTIONS"), which may either be options designed to qualify
as "incentive stock options" within the meaning of Section 422 of the Internal
Revenue Code of 1986, as amended (the "CODE") (an "ISO") or options not intended
to qualify for any special tax treatment under the Code (a "NQO"). The term
"SUBSIDIARY" as used in the Plan means a corporation of which the Company owns,
directly or indirectly through an unbroken chain of ownership, fifty percent
(50%) or more of the total combined voting power of all classes of stock. A
person to whom an Option has been granted pursuant to the Plan is hereinafter
referred to as an "OPTIONEE".

     2. ADMINISTRATION OF THE PLAN

     The Plan shall be administered by the Board of Directors of the Company
(the "BOARD OF DIRECTORS") or by a committee appointed by the Board of Directors
(the "COMMITTEE"), which shall have the authority to adopt, amend and rescind
such rules and regulations as, in its opinion, may be advisable in the
administration of the Plan. Unless the Board of Directors otherwise provides for
the method by which the appointed committee shall operate, the Committee shall
select one of its members as Chairman and shall hold meetings at such times and
places as it may determine. A majority of the Committee shall constitute a
quorum and acts of the Committee at which a quorum is present, or acts reduced
to or approved in writing by all the members of the Committee, shall be the
valid acts of the Committee. Hereinafter, all references in this Plan to the
"Committee" shall mean the Board of Directors if no Committee has been
appointed. All questions of interpretation and application of such rules and
regulations, of the Plan or of Options granted thereunder shall be subject to
the determination, which shall be final and binding, of a majority of the
Committee. The Plan shall be administered in such a manner as to permit those
Options granted hereunder and specially designated under Section 4 hereof to
qualify as "incentive stock options" as described in Section 422A of the Code.


                                       1


<PAGE>


     3. OPTION SHARES

     The stock subject to Options under the Plan shall be shares of the
Company's Common Stock, par value $.001 per share (the "Stock"). At no time
shall the number of shares of Stock with respect to which outstanding Options
have been granted plus the number of shares of Stock issued as a result of the
exercise of options under the Plan and which are still outstanding exceed in the
aggregate 6,625,000 shares (the "OPTION POOL"), provided that such aggregate
number of shares shall be subject to adjustment in accordance with the
provisions of Section 17. In the event that any outstanding Option shall expire
for any reason or shall terminate by reason of the death or severance of
employment of the Optionee, the surrender of any such Option, or any other
cause, the shares of Stock allocable to the unexercised portion of such Option
may again be subject to an option under the Plan. Should the Company repurchase
any shares of Stock which were acquired pursuant to the exercise of options
granted under the Plan, such shares may be returned to the Option Pool pursuant
to a vote of the Committee, subject, however, to the Option Pool size limitation
set forth above.

     4. AUTHORITY TO GRANT OPTIONS

     The Committee may grant from time to time, to employee, directors, or
consultants of the Company as it shall from time to time determine, an Option or
Options to buy a stated number of shares of Stock under the terms and conditions
of the Plan, each of which Option or Options shall be designated at the time of
grant as either an ISO or a NQO. Subject only to any applicable limitations set
forth elsewhere in the Plan, the number of shares of Stock to be covered by any
Option shall be as determined by the Committee; PROVIDED, that in no event shall
the number of shares of Stock covered by the Options granted to any one person
in any one calendar year exceed 25% of the aggregate number of shares of Stock
subject to the Plan. The Committee shall have the right, with the consent of the
Optionee, to convert an ISO granted under the Plan into a NQO and to impose such
conditions on the exercise of the resulting NQO as the Committee may in its
discretion determine, provided that such conditions shall not be inconsistent
with the Plan.

     5. WRITTEN AGREEMENT

     Options granted hereunder shall be embodied in written option agreements
(which need not be identical) in such forms as the Committee may from time to
time approve (each an "OPTION AGREEMENT"). Option Agreements shall be subject to
the terms and conditions prescribed herein and shall be signed by the Optionee
and by the President or any Vice President of the Company for and in the name
and on behalf of the Company. An Option Agreement shall indicate whether the
subject Option has been


                                       2


<PAGE>


designated an ISO or a NQO. The written Option Agreement for any Option may
contain such provisions not inconsistent with this Plan as the Committee in its
discretion may deem advisable.

     6. ELIGIBILITY

     The individuals who shall be eligible for grant of Options under the Plan
shall be key employees (including officers who may be members of the Board of
Directors), directors who are not employees and other individuals who render
services of special importance to the management, operation, or development of
the Company or a Subsidiary, and who have contributed or may be expected to
contribute materially to the success of the Company or a Subsidiary. No Option
designated as an ISO shall be granted to any individual who is not an employee
of the Company or a Subsidiary.

     If required to insure compliance with Section 16 of the Securities Exchange
Act of 1934 (the "EXCHANGE ACT"), the selection of a director as a participant
and the number of shares for which an Option may be granted to such director
shall be determined either (i) by the Board of Directors, of which a majority,
as well as a majority of the directors acting in the matter, shall be
"disinterested persons" (as hereinafter defined) or (ii) by, or only in
accordance with, the recommendations of a committee of three or more persons
having full authority to act in the matter, of which all members shall be
"disinterested persons". For purposes of the Plan, a director or member of such
committee shall be deemed to be "disinterested" only if such person qualifies as
a "disinterested person" within the meaning of Rule 16b-3 under the Exchange
Act, or any successor rule, as such term is interpreted from time to time.

     7. OPTION PRICE

     The price at which shares may be purchased pursuant to an Option shall be
specified by the Committee at the time the Option is granted, but shall in no
event be less than the par value of such shares and, in the case of an incentive
stock option, except as set forth in the following sentence, shall not be less
than one hundred percent (100%) of the fair market value of the shares of Stock
on the date the ISO is granted. In the case of any employee who owns (or is
considered under Section 424(d) of the Code as owning) stock possessing more
than ten percent (10%) of the total combined voting power of all classes of
stock of the Company or any Subsidiary, the price at which shares may be so
purchased pursuant to an incentive stock option shall be not less than one
hundred ten percent (110%) of the fair market value of the Stock on the date the
ISO is granted.


                                       3
<PAGE>


     For purposes of the Plan, the "fair market value" of a share of Stock on
any date specified herein shall mean (a) the last reported sales price, regular
way, or, in the event that no sale takes place on such day, the average of the
reported lowest closing bid and asked prices, regular way, in either case (i) as
reported on the New York Stock Exchange Composite Tape, or (ii) if the Stock is
not listed or admitted to trading on the New York Stock Exchange, on the
principal national securities exchange on which such security is listed or
admitted to trading, or (iii) if not then listed or admitted to trading on any
national securities exchange, on the NASDAQ National Market System; or (b) if
the stock is not quoted on such National Market System, (i) the average of the
closing bid and asked prices on each such day in the over-the-counter market as
reported by NASDAQ, or (ii) if bid and asked prices for such security on each
such day shall not have been reported through NASDAQ, the average of the bid and
asked prices for such day as furnished by any New York Stock Exchange member
firm regularly making a market in such security selected for such purpose by the
Committee; or (c) if the Stock is not then listed or admitted to trading on any
national exchange or quoted in the over-the-counter market, the fair value
thereof determined in good faith by the Committee-as of a date which is within
thirty (30) days of the date as of which the determination is to be made;
provided however that any method of determining fair market value employed by
the Committee with respect to an ISO shall be consistent with any applicable
laws or regulations pertaining to "incentive stock options".

     8. DURATION OF OPTIONS

     The duration of any Option shall be specified by the Committee in the
Option Agreement, but no ISO shall be exercisable after the expiration of ten
(10) years from the date such Option is granted. In the case of any employee who
owns (or is considered under Section 424(d) of the Code as owning) stock
possessing more than ten percent (10%) of the total combined voting power of all
classes of stock of the Company or any Subsidiary, no ISO shall be exercisable
after the expiration of five (5) years from the date such Option is granted. The
Committee, in its sole and absolute discretion, may extend any Option
theretofore granted subject to the aforesaid limits and may provide that an
Option shall be exercisable during its entire duration or during any lesser
period of time.

     9. RESTRICTION ON EXERCISE OF OPTIONS

     Notwithstanding any other provision of the Plan, the aggregate fair market
value (determined as of the time the Option is granted) of the Stock with
respect to which ISOs may be exercisable for the first time by an Optionee
during any calendar year (under the Plan or any other incentive


                                       4
<PAGE>


stock option plan(s) of the Company or any Subsidiary) shall not exceed
$100,000. Subject to the foregoing, each Option may be exercised so long as it
is valid and outstanding from time to time, in part or as a whole, in such
manner and subject to such conditions as the Committee, in its sole and absolute
discretion, may provide in the Option Agreement. Notwithstanding the foregoing,
any shares of Stock that would cause the foregoing $100,000 limitation to be
violated shall be deemed to have been granted under a separate NQO, otherwise
identical in its terms to those of the ISO.

     10. EXERCISE OF OPTIONS

     Each Option may be exercised from time to time in such amounts as is
provided in the Option Agreement by the delivery of written notice to the
Company setting forth the number of shares with respect to which the Option is
to be exercised, accompanied by payment of the option price of such shares,
which payment shall be made, subject to the alternative provisions of this
Section, in cash or by such cash equivalents, payable to the order of the
Company in an amount in United States dollars equal to the option price of such
shares, as the Committee in its discretion shall consider acceptable. Such
notice shall be delivered in person to the Secretary of the Company or shall be
sent by registered mail, return receipt requested, to the Secretary of the
Company, in which case delivery shall be deemed made on the date such notice is
deposited in the mail.

     Alternatively, payment of the option price may be made, in whole or in
part, in shares of Stock owned by the Optionee; provided, however, that the
Optionee may not make payment in shares of Stock that he acquired upon the
earlier exercise of any ISO, unless he has held the shares until at least two
(2) years after the date the ISO was granted and at least one (1) year after the
date the ISO was exercised. If payment is made in whole or in part in shares of
Stock, then the Optionee shall deliver to the Company in payment of the option
price of the shares with respect of which such Option is exercised (i)
certificates registered in the name of such Optionee representing a number of
shares of Stock legally and beneficially owned by such Optionee, free of all
liens, claims and encumbrances of every kind and having a fair market value on
the date of delivery of such notice equal to the option price of the shares with
respect to which such Option is to be exercised, such certificates to be
accompanied by stock powers duly endorsed in blank by the record holder of the
shares represented by such certificates; and (ii) if the option price of the
shares with respect to which such Option is to be exercised exceeds such fair
market value, cash or such cash equivalents payable to the order to the Company,
in an amount in United States dollars equal to the amount of such excess, as the
Committee in its discretion shall consider acceptable. Notwithstanding the
foregoing provisions of this Section, the


                                       5
<PAGE>


Committee, in its sole discretion, may refuse to accept shares of Stock in
payment of the option price of the shares with respect to which such Option is
to be exercised and, in that event, any certificates representing shares of
Stock which were delivered to the Company with such written notice shall be
returned to such Optionee together with notice by the Company to such Optionee
of the refusal of the Committee to accept such shares of Stock.

     Alternatively, if the Option Agreement so specifies or if the Committee in
its sole and absolute discretion permits, payment of the option price may be
made in part by a promissory note executed by the Optionee and collaterally
secured by the Stock obtained upon exercise of the Option, providing for
repayment at such time or times as the Committee shall specify; provided,
however, (a) that such promissory note shall provide for repayment no later than
five (5) years from the date of exercise and for interest at a rate not less
than the "base" rate announced on the date of exercise by Fleet Bank, (b) that
in any event an amount not less than the par value of the shares of Stock with
respect to which the Option is being exercised must be paid in cash, cash
equivalents, or shares of Stock in accordance with this Section and (c) the
payment of such exercise price by promissory note does not violate any
applicable laws or regulations, including, without limitation, margin lending
rules. The decision as to whether to permit partial payment by a promissory note
for Stock to be issued upon exercise of any Option granted shall rest entirely
in the discretion of the Committee.

     As promptly as practicable after the receipt by the Company of (i) written
notice from the Optionee setting forth the number of shares with respect to
which such Option is to be exercised and (ii) payment of the option price of
such shares in the form required by the foregoing provisions of this Section,
the Company shall cause to be delivered to such Optionee certificates
representing the number of shares with respect to which such Option has been so
exercised. Notwithstanding the foregoing, if an Optionee owes money to or is
otherwise indebted to the Company at the time of his or her exercise of an
Option then in addition to other rights which the Company may have, the Company
may in its sole discretion refuse to issue shares upon such exercise and may set
off such debt against the value of such shares or may retain such shares to the
extent of the amount of such debt.

     11. NONTRANSFERABILITY OF OPTIONS

     ISOs shall not be transferable, otherwise than by will or the laws of
descent and distribution, and may be exercised during the life of the Optionee
only by the Optionee. NSOs shall not be transferable, other than by will or the
laws of descent and distribution, and may be exercised during the life of


                                       6
<PAGE>


the Optionee only by the Optionee; provided, however, that the Committee may, at
or after the grant of a NSO, provide that such Option may be transferred by the
recipient to an immediate family member; provided, however, that any such
transfer is without payment of any consideration whatsoever and that no transfer
of an Option shall be valid unless first approved by the Committee, acting in
its sole discretion. For this purpose, "immediate family member" means an
individual's parents, siblings, spouse and issue, spouses of such issue and the
recipient or any trust for the benefit of, or the legal representative of, the
Optionee or any of the preceding persons or any combination thereof, or any
partnership substantially all of the partners of which are one or more of such
persons or the Optionee.

     12. TERMINATION OF EMPLOYMENT OR INVOLVEMENT OF OPTIONEE WITH THE COMPANY

     For purposes of this Section, employment by or involvement with (in the
case of an Optionee who is not an employee) a Subsidiary shall be considered
employment by or involvement with the Company. NQOs shall be exercisable
following an Optionee's termination of employment or involvement with the
Company to the extent provided below with respect to ISOs unless otherwise set
forth in the Option Agreement for such non-qualified options. Except as may be
otherwise expressly provided herein, Options designated incentive stock options
shall be exercisable after the Optionee's termination of employment with the
Company only within the period of three (3) months after the date the Optionee
ceases to be in the employ of the Company, unless terminated earlier by its
terms and only to the extent to which the Optionee was entitled to exercise the
Option immediately prior to the termination of his or her employment. If, before
the date of expiration of the Option, the Optionee shall be retired in good
standing from the employ of the Company for reasons of age under the then
established rules of the Company, the Option shall terminate on the earlier of
such date of expiration or three (3) months after the date of such retirement.
In the event of the death of the holder of an Option before the date of
expiration of such Option and while in the employ of the Company or during the
three (3) month period described in the preceding sentence, or in the event of
the retirement of the Optionee for reasons of disability (within the meaning of
Section 22(e)(3) of the Code), such Option shall terminate on the earlier of
such date of expiration or one (1) year following the date of such death or
retirement. After the death of the Optionee, his or her executors,
administrators or any persons to whom his or her Option may be transferred by
will or by the laws of descent and distribution shall have the right at any time
prior to such termination to exercise the Option to the extent to which the
Optionee was entitled to exercise the Option on the date of his or her death.


                                       7
<PAGE>


     Authorized leave of absence or absence on military or government service
shall not constitute severance of the employment relationship between the
Company and the Optionee for purposes of the Plan, provided that either (i) such
absence is for a period of no more than ninety (90) days or (ii) the Optionee's
right to re-employment after such absence is guaranteed either by statute or by
contract.

     13. REQUIREMENTS OF LAW

     The Company shall not be required to sell or issue any shares of Stock upon
the exercise of any Option if the issuance of such shares shall constitute or
result in a violation by the Optionee or the Company of any provisions of any
law, statute or regulation of any governmental authority. Specifically, in
connection with the Securities Act of 1933, as amended (the "SECURITIES ACT"),
and any applicable state securities or "blue sky" law (a "BLUE SKY LAW"), upon
exercise of any Option the Company shall not be required to issue such shares
unless the Committee has received evidence satisfactory to it to the effect that
the holder of such Option will not transfer such shares except pursuant to a
registration statement in effect under the Securities Act and Blue Sky Laws or
unless an opinion of counsel satisfactory to the Company has been received by
the Company to the effect that such registration and compliance is not required.
Any determination in this connection by the Committee shall be final, binding
and conclusive. The Company shall not be obligated to take any other affirmative
action in order to cause the exercise of an Option or the issuance of shares of
Stock pursuant thereto to comply with any law or regulations of any governmental
authority, including, without limitation, the Securities Act or applicable Blue
Sky Laws.

     Notwithstanding any other provision of the Plan to the contrary, the
Company may refuse to permit transfer of shares of Stock if in the opinion of
its legal counsel such transfer would violate federal or state securities laws
or subject the Company to liability thereunder. Any sale, assignment, transfer,
pledge or other disposition of shares of Stock received upon exercise of any
Option (or any other shares or securities derived therefrom) which is not in
accordance with the provisions of this Section shall be void and of no effect
and shall not be recognized by the Company.

     LEGEND ON CERTIFICATES. The Committee may cause any certificate
representing shares of Stock acquired upon exercise of an Option (and any other
shares or securities derived therefrom) to bear a legend to the effect that the
securities represented by such certificate have not been registered under the
Securities Act or any applicable state securities laws, and may not be sold,
assigned, transferred, pledged or otherwise disposed of except in


                                       8
<PAGE>


accordance with the Plan and applicable agreements binding the holder and the
Company or any of its stockholders.

     14. NO RIGHTS AS STOCKHOLDER

     No Optionee shall have rights as a stockholder with respect to shares
covered by his or her Option until the date of issuance of a stock certificate
for such shares. Except as otherwise provided in Section 17 no adjustment for
dividends or other rights shall be made if the record date therefor is prior to
the date of issuance of such certificate.

     15. EMPLOYMENT OBLIGATION

     Nothing in this Plan nor the granting of any Option under this Plan shall
(i) impose upon the Company or any Subsidiary any obligation to employ or
continue to employ any Optionee, or to engage or retain the services of any
person, (ii) diminish or affect the right of the Company or any Subsidiary to
terminate the employment or services of any person or (iii) affect the ability
of the Company to increase or decrease the compensation of any person. The
existence of any Option shall not be taken into account in determining any
damages relating to termination of employment for any reason.

     16. FORFEITURE AS A RESULT OF TERMINATION FOR CAUSE

     Notwithstanding anything to the contrary in the Plan, if the Committee
determines, after full consideration of the facts presented on behalf of both
the Company and an Optionee, that

         a. the Optionee has been engaged in fraud, embezzlement, theft,
         commission of a felony or proven dishonesty in the course of his or her
         employment by or involvement with the Company or a Subsidiary, which
         damaged the Company or a Subsidiary, or has made unauthorized
         disclosure of trade secrets or other proprietary information of the
         Company or a Subsidiary or of a third party who has entrusted such
         information to the Company or a Subsidiary, or

         b. the Optionee's employment or involvement was otherwise terminated
         for "cause", as defined in any employment agreement with the Optionee,
         if applicable, or if there is no such agreement, as determined by the
         Committee, which may determine that "cause" includes among other
         matters the failure or inability of the Optionee to carry out his or
         her assigned duties diligently and in a manner satisfactory to the
         Company,


                                       9
<PAGE>


then the Optionee's right to exercise an Option shall terminate as of the date
of such act (in the case of Section 16.a) or such termination (in the case of
Section 16.b) and the Optionee shall forfeit all unexercised Options. If an
Optionee whose behavior the Company asserts falls within the provisions of
Section 16.a or Section 16.b above has exercised or attempts to exercise an
Option prior to a decision of the Committee, the Company shall not be required
to recognize such exercise until the Committee has made its decision and, in the
event of any exercise shall have taken place, it shall be of no force and effect
(and void ab initio) if the Committee makes an adverse determination; provided,
however, if the Committee finds in favor of the Optionee then the Optionee will
be deemed to have exercised such Options retroactively as of the date he or she
originally gave written notice of his or her attempt to exercise or actual
exercise, as the case may be. The decision of the Committee as to the cause of
an Optionee's discharge and the damage done to the Company or a Subsidiary shall
be final, binding and conclusive. No decision of the Committee, however, shall
affect in any manner the finality of the discharge of such Optionee by the
Company or a Subsidiary.

     17. CHANGES IN THE COMPANY'S CAPITAL STRUCTURE

     The existence of outstanding Options shall not affect in any way the right
or power of the Company or its stockholders to make or authorize any
adjustments, recapitalizations, reorganizations or other changes in the
Company's capital structure or its business or any merger or consolidation of
the Company or any issue of bonds, debentures, preferred or preference stock,
whether or not convertible into the Stock or other securities, ranking prior to
the Stock or affecting the rights thereof, or warrants, rights or options to
acquire the same, or the dissolution or liquidation of the Company or any sale
or transfer of all or any part of its assets or business or any other corporate
act or proceeding, whether of a similar character or otherwise.

     The number of shares of Stock in the Option Pool (less the number of shares
theretofore delivered upon exercise of Options) and the number of shares of
Stock covered by any outstanding Option and the price per share payable upon
exercise thereof (provided that in no event shall the option price be less than
the par value of such shares) shall be proportionately adjusted for any increase
or decrease in the number of issued and outstanding shares of Stock resulting
from the subdivision, split, combination or consolidation of shares of Stock or
any other capital adjustment, the payment of a stock dividend or any other
increase in such shares effected without receipt of consideration by the Company
or any other decrease therein effected without a distribution of cash or
property in connection therewith, provided, however, that no adjustment shall be
made that would constitute a modification as defined in Section 424(h)(3) of the
Code.


                                       10
<PAGE>


     In the event the Company merges or consolidates with a wholly-owned
subsidiary for the purpose of reincorporating itself under the laws of another
jurisdiction, the Optionees will be entitled to acquire shares of the common
stock of the reincorporated Company upon the same terms and conditions as were
in effect immediately prior to such reincorporation (unless such reincorporation
involves a change in the number of shares, in which case proportional
adjustments shall be made as provided above) and the Plan, unless otherwise
rescinded by the Committee, will remain the Plan of the reincorporated Company.

     Except as otherwise provided in the preceding paragraph, if the Company is
merged or consolidated with another corporation, whether or not the Company is
the surviving entity, or if the Company is liquidated or sells or otherwise
disposes of all or substantially all of its assets to another entity while
unexercised Options remain outstanding under the Plan, or in other circumstances
in which the Committee in its sole and absolute discretion deems it appropriate
for the provisions of this paragraph to apply, (a) subject to the provisions of
clause (c) below, after the effective date of such merger, consolidation,
liquidation, sale or other event (in each case, an "APPLICABLE EVENT"), as the
case may be, each holder of an outstanding Option shall be entitled, upon
exercise of such Option, to receive in lieu of shares of Stock, such stock or
other securities or property as he or she would have received had he exercised
such Option immediately prior to the Applicable Event; (b) the Committee may, in
its sole and absolute discretion, waive, generally or in more specific cases,
any limitations imposed pursuant to Section 9 (even if the effect of such waiver
is to disqualify the Option as an ISO) or Section 19 so that some or all Options
from and after a date prior to the effective date of such Applicable Event
specified by the Committee, in its sole and absolute discretion, shall be
exercisable in full; and (c) all outstanding and unexercised Options may, in its
sole and absolute discretion, be cancelled by the Committee as of the effective
date of any such Applicable Event; provided, however, notice of any such
cancellation shall be given to each holder of an Option not less than thirty
(30) days preceding the effective date of such Applicable Event; and provided
further, however, that the Committee may in its sole and absolute discretion,
waive, generally or in one or more specific instances, any limitations imposed
pursuant to Section 9 (even if the effect of such waiver is to disqualify the
Option as an ISO) or Section 19 with respect to any Option so that such Option
shall be exercisable in full or in part, as the Committee may, in its sole and
absolute discretion, determine, during such thirty (30) day period.

     Except as expressly provided herein, the issue by the Company of shares of
Stock or other securities of any class or securities convertible into or
exchangeable or exercisable for shares of Stock or other securities of any class


                                       11
<PAGE>



for cash or property or for labor or services either upon direct sale or upon
the exercise of rights or warrants to subscribe therefor, or upon conversion of
shares or obligations of the Company convertible into such shares or other
securities, shall not affect, and no adjustment by reason thereof shall be made
with respect to, the number, class or price of shares of Stock then subject to
outstanding Options.

     18. AMENDMENT OR TERMINATION OF THE PLAN

     The Board of Directors may at any time terminate the Plan or make such
modifications of the Plan as it shall deem advisable. Unless the Board of
Directors otherwise expressly provides, no amendment of the Plan shall affect
the terms of any Options outstanding on the date of such amendment. In any case,
no termination or amendment of the Plan may, without the consent of any
recipient of an Option granted hereunder, adversely affect the rights of such
recipient under such Option.

     The Committee may amend the terms of any Option theretofore granted,
prospectively or retroactively, provided that as amended such Award is
consistent with the terms of the Plan, but no such amendment shall impair the
rights of the recipient of such Option without such recipient's consent.

     19. EFFECTIVE DATE AND DURATION OF THE PLAN

     The Plan shall become effective and shall be deemed to have been adopted on
April l, 1997 subject only to ratification by the holders of at least a majority
of the outstanding shares of Stock within twelve (12) months after such date.
Unless the Plan shall have terminated earlier, the Plan shall terminate on the
tenth (10th) anniversary of its effective date, and no Option shall be granted
pursuant to the Plan after the day preceding the tenth (10th) anniversary of its
effective date.


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