Exhibit 10.3


                                  PROCEPT, INC.

                         1994 Director Stock Option Plan

As Amended by the Board of Directors on January 20, 1997 (no stockholder
approval required) and as further amended by the Board of Directors on March 17,
1997 and approved by the Stockholders on June 16, 1997.


1.  Purpose.

    The purpose of this 1994 Director Stock Option Plan (the "Plan") of Procept,
Inc. (the "Company") is to attract and retain highly qualified non-employee
directors of the Company and to encourage ownership of stock of the Company by
such directors so as to provide additional incentives to promote the success of
the Company.

2.  Administration of the Plan.

    Grants of stock options under the Plan shall be automatic as provided in
Section 7. However, all questions of interpretation with respect to the Plan and
options granted under it shall be determined by the Board of Directors of the
Company (the "Board") or by a committee consisting of one or more directors
appointed by the Board and such determination shall be final and binding upon
all persons having an interest in the Plan.

3.  Persons Eligible to Participate in the Plan.

    Each director of the Company who is not any one of:

    (a) an employee of the Company or of any subsidiary of the Company,

    (b) an employee, or otherwise a representative, of an institutional venture
        capital investor in the Company, or

    (c) subject to any law, contract or other obligation (including obligations
        arising from such director's professional institutional affiliation)
        which prohibits or restricts such director's ownership of shares in the
        Company (including any restriction which would require a director to
        transfer options granted under the Plan in violation of Section 7(h)),

shall be eligible to participate in the Plan unless such director irrevocably
elects not to participate.

4.  Shares Subject to the Plan.

    (a) The aggregate number of shares of the Company's common stock, $.01 par
value ("Common Stock") which may be optioned under this Plan is Three Hundred
Thousand (300,000) shares. Shares issued under the Plan may consist in whole or
in part of authorized but unissued shares or treasury shares.

    (b) In the event of a stock dividend, split-up, combination or
reclassification of shares, recapitalization or other similar capital change
relating to the Company's Common Stock, the maximum


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aggregate number and kind of shares or securities of the Company as to which
options may be granted under this Plan and as to which options then outstanding
shall be exercisable, and the option price of such options shall be
appropriately adjusted so that the proportionate number of shares or other
securities as to which options may be granted and the proportionate interest of
holders of outstanding options shall be maintained as before the occurrence of
such event.

    (c) In the event of a consolidation or merger of the Company with another
corporation where the Company's stockholders do not own a majority in interest
of the surviving or resulting corporation, or the sale or exchange of all or
substantially all of the assets of the Company, or a reorganization or
liquidation of the Company, any deferred exercise period shall be automatically
accelerated and each holder of an outstanding option shall be entitled to
receive upon exercise and payment in accordance with the terms of the option the
same shares, securities or property as he would have been entitled to receive
upon the occurrence of such event if he had been, immediately prior to such
event, the holder of the number of shares of Common Stock purchasable under his
or her option; provided, however, that in lieu of the foregoing the Board may
upon written notice to each holder of an outstanding option or right under the
Plan, provide that such option or right shall terminate on a date not less than
20 days after the date of such notice unless theretofore exercised.

    (d) Whenever options under this Plan lapse or terminate or otherwise become
unexercisable the shares of Common Stock which were subject to such options may
again be subjected to options under this Plan. The Company shall at all times
while this Plan is in force reserve such number of shares of Common Stock as
will be sufficient to satisfy the requirements of this Plan.

5.  Non-Statutory Stock Options.

    All options granted under this Plan shall be non-statutory options not
entitled to special tax treatment under Section 422 of the Internal Revenue Code
of 1986, as amended (the "Code").

6.  Form of Options.

    Options granted hereunder shall be in such form as the Board or any
committee appointed pursuant to Section 2 above may from time to time determine.

7.  Grant of Options and Option Terms.

    (a) Automatic Grant of Options. Each eligible director as of January 20,
1997 shall be automatically granted options on such date to purchase Twenty
Thousand (20,000) shares of Common Stock. Each director who becomes eligible by
election (whether by the Board or the stockholders and whether to fill a vacancy
or otherwise) or otherwise after January 20, 1997 shall be automatically granted
options on the date of first eligibility to purchase Twenty Thousand (20,000)
shares of Common Stock. Each eligible director as of any annual meeting of
stockholders after January 20, 1997 who does not then hold options granted under
this Plan which are not fully exercisable, shall be automatically granted
options on such date to purchase Twenty Thousand (20,000) shares of Common
Stock.

    (b) Date of Grant. The "Date of Grant" for options granted under this Plan
shall be (i) the actual date of grant for options granted prior to January 20,
1997, (ii) January 20, 1997 for options granted on January 20, 1997, (iii) the
date of first eligibility for options granted upon a director first becoming
eligible under this Plan or (iv) the date of an annual meeting of stockholders
for options granted on such date.


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    (c) Option Price. The option price for each option granted under this Plan
shall be the current fair market value of a share of Common Stock of the Company
as determined by the last sale price for the Company's Common Stock as reported
by the Nasdaq National Market for the business day immediately preceding the
Date of Grant.

    (d) Term of Option. The term of each option granted under this Plan shall be
ten years from the Date of Grant.

    (e) Exercisability of Options. Except as otherwise provided in this Plan,
options granted under this Plan on or after January 20, 1997 shall be
exercisable as to Ten Thousand (10,000) shares of Common Stock on the date of
each of the next two annual meetings of the stockholders of the Company
following the Date of Grant if and only if the option holder is a member of the
Board at the opening of business on that date.

    (f) General Exercise Terms. Directors holding exercisable options under this
Plan who cease to serve as members of the Board may, during their lifetime,
exercise the rights they had under such options at the time they ceased being a
director for the full unexpired term of such option. Any rights that have not
yet become exercisable shall terminate upon cessation of membership on the
Board. Upon the death of a director, those entitled to do so shall have the
right, at any time within twelve months after the date of death, to exercise in
whole or in part any rights which were available to the director at the time of
his or her death. The rights of the option holder may be exercised by the
holder's guardian or legal representative in the case of disability and by the
beneficiary designated by the holder in writing delivered to the Company or, if
none has been designated, by the holder's estate or his or her transferee on
death in accordance with this Plan, in the case of death. Options granted under
the Plan shall terminate, and no rights thereunder may be exercised, after the
expiration of the applicable exercise period. Notwithstanding the foregoing
provisions of this section, no rights under any options may be exercised after
the expiration of ten years from their Date of Grant.

    (g) Method of Exercise and Payment. Options may be exercised only by written
notice to the Company at its principal office accompanied by payment of the full
option price for the shares of Common Stock as to which they are exercised. The
option price shall be paid in cash or by check or in shares of Common Stock of
the Company, or in any combination thereof. Shares of Common Stock surrendered
in payment of the option price shall have been held by the person exercising the
option for at least six months, unless otherwise permitted by the Board. The
value of shares delivered in payment of the option price shall be their fair
market value, as determined in accordance with Section 7(c) above, as of the
date of exercise. Upon receipt of such notice and payment, the Company shall
promptly issue and deliver to the optionee (or other person entitled to exercise
the option) a certificate or certificates for the number of shares as to which
the exercise is made.

    (h) Limitations on Transferability. Options granted under this Plan shall
not be transferable by the recipient other than by will or the laws of descent
and distribution and are exercisable during such person's lifetime only by such
person or by such person's guardian or legal representative, provided that the
Board or any committee appointed by the Board may in its discretion waive such
restriction in any case.

8.  Limitation of Rights.

    (a) No Right to Continue as a Director. Neither the Plan, nor the granting
of an option or any other action taken pursuant to the Plan, shall constitute an
agreement or understanding, express or


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implied, that the Company will retain an option holder as a director for any
period of time or at any particular rate of compensation.

    (b) No Stockholders' Rights for Options. A director shall have no rights as
a stockholder with respect to the shares covered by options until the date the
director exercises such options and pays the option price to the Company, and no
adjustment will be made for dividends or other rights for which the record date
is prior to the date such option is exercised and paid for.

9.  Amendment or Termination.

    The Board may amend or terminate this Plan at any time. The Board may amend
or modify any outstanding option in any respect, provided that the optionee's
consent to such action shall be required unless the Board determines that the
action, taking into account any related action, would not materially and
adversely affect the optionee.

10. Stockholder Approval.

    This Plan was approved by the stockholders of the Company on June 6, 1995
and the amendments hereto approved by the Board of Directors on January 20, 1997
shall not require approval by the stockholders. Further amendments shall be
subject to stockholder approval to the extent (i) required by law, (ii) required
by Nasdaq or stock exchange listing requirements, as determined by the Board of
Directors, or (iii) as desirable, as determined by the Board of Directors, to
comply with Rule 16b-3 under the Securities Exchange Act of 1934, as amended. In
the event any such approval is not obtained, all options granted under this Plan
after such further amendment shall be void and without effect.

11. Governing Law.

    This Plan shall be governed by and interpreted in accordance with the laws
of the State of Delaware.


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