Document:

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                                                                    Exhibit 10.1

                      INTEGRATED INFORMATION SYSTEMS, INC.

                          1997 LONG-TERM INCENTIVE PLAN
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                      INTEGRATED INFORMATION SYSTEMS, INC.
                          1997 LONG-TERM INCENTIVE PLAN

ARTICLE 1         PURPOSE

         1.1      GENERAL. The purpose of the Integrated Information Systems,
                  Inc. 1997 Long-Term Incentive Plan (the "Plan") is to promote
                  the success and enhance the value of Integrated Information
                  Systems, Inc. (the "Company") by linking the personal
                  interests of its officers, directors, employees, consultants,
                  or independent contractors to those of Company stockholders
                  and by providing its officers, directors, employees,
                  consultants, or independent contractors with an incentive for
                  outstanding performance. The Plan is further intended to
                  provide flexibility to the Company in its ability to motivate,
                  attract, and retain the services of officers, directors,
                  employees, consultants, or independent contractors upon whose
                  judgment, interest, and special effort the successful conduct
                  of the Company's operation is largely dependent. Accordingly,
                  the Plan permits the grant of incentive awards, non-qualified
                  awards, and other awards from time to time to officers,
                  directors, employees, consultants, or independent contractors.

ARTICLE 2         EFFECTIVE DATE

         2.1      EFFECTIVE DATE. The Plan is effective as of January 1, 1997
                  (the "Effective Date").

ARTICLE 3         DEFINITIONS AND CONSTRUCTION

         3.1      DEFINITIONS. When a word or phrase appears in this Plan with
                  the initial letter capitalized, and the word or phrase does
                  not commence a sentence, the word or phrase shall generally be
                  given the meaning ascribed to it in this Section or in
                  Sections 1.1 or 2.1 unless a clearly different meaning is
                  required by the context. The following words and phrases shall
                  have the following meanings:

                  (a)      "Award" means any Option, Stock Appreciation Right,
                           Restricted Stock Award, or Performance Share Award
                           granted to a Participant under the Plan.

                  (b)      "Award Agreement" means any written agreement,
                           contract, or other instrument or document evidencing
                           an Award.

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

                  (d)      "Change of Control" means and includes each of the
                           following:

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                           (1)      When the individuals who, at the beginning
                                    of any one-year period, constituted the
                                    Board of Directors of the Company cease, for
                                    any reason, to constitute at least a
                                    majority thereof, unless the election or
                                    nomination for election of each new director
                                    was approved by the vote of at least
                                    two-thirds of the directors then still in
                                    office who were directors at the beginning
                                    of such period and who have not otherwise
                                    died or become Disabled;

                           (2)      A change of control of the Company through a
                                    transaction or series of transactions. such
                                    that any person (as that term is used in
                                    Section 13 and 14(d)(2) of the 1934 Act),
                                    excluding affiliates of the Company as of
                                    the Effective Date, is or becomes the
                                    beneficial owner (as that term is used in
                                    Section 13(d) of the 1934 Act) directly or
                                    indirectly of securities of the Company
                                    representing fifty-one percent (51%) or more
                                    of the combined voting power of the
                                    Company's then outstanding securities;

                           (3)      Any consolidation or merger of the Company
                                    in which the Company is not the continuing
                                    or surviving corporation or pursuant to
                                    which Stock would be converted into cash,
                                    securities or other property, other than a
                                    merger of the Company in which the holders
                                    of the shares of Stock immediately before
                                    the merger own at least forty-nine percent
                                    (49%) of the common stock of the surviving
                                    corporation immediately after the merger;

                           (4)      The stockholders of the Company approve any
                                    plan or proposal for the liquidation or
                                    dissolution of the Company; or

                           (5)      Substantially all of the assets of the
                                    Company are sold or otherwise transferred to
                                    parties that are not within a "controlled
                                    group of corporations" (as defined in
                                    Section 1563 of the Code) of which the
                                    Company is a member.

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

                  (f)      "Committee" means the committee of the Board
                           described in Article 4.

                  (g)      "Disability" means any illness or other physical or
                           mental condition of a Participant which renders the
                           Participant incapable of performing his/her customary
                           and usual duties for the Company, or any medically
                           determinable illness or other physical or mental
                           condition resulting from a bodily injury, disease or
                           mental disorder

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                           which in the judgment of the Committee is permanent
                           and continuous in nature. The Committee may require
                           such medical or other evidence as it deems necessary
                           to judge the nature and permanency of the
                           Participant's condition.

                  (h)      "Fair Market Value" means, as of any given date, the
                           fair market value of Stock or other property on a
                           particular date determined by such methods or
                           procedures as may be established from time to time by
                           the Committee.

                  (i)      "For Cause Termination" means a termination of an
                           employee's employment with the Company because the
                           Company has determined, in good faith, that the
                           employee has: (i) engaged in misconduct involving a
                           material violation of established Company rules or
                           policies for the conduct of its employees including,
                           but not limited to, theft, gross negligence,
                           discriminatory conduct prohibited by Company
                           policies, sexual harassment of an employee or a
                           subordinate, or such other similar offense or
                           offenses that would be grounds for discharge of an
                           employee under Company rules or policies; (ii)
                           engaged in financial misconduct, including
                           embezzlement or using Company assets for unauthorized
                           personal use resulting in a material loss to the
                           Company; (iii) engaged in a willful and continued
                           failure to substantially perform employee's duties
                           and responsibilities (other than due to a Disability)
                           and employee has received written notice of such
                           failure prior to a For Cause Termination; (iv)
                           breached an agreement that relates to the employee's
                           employment with the Company; or (v) been convicted of
                           a crime constituting a felony.

                  (j)      "Incentive Stock Option" means an Option that is
                           intended to meet the requirements of Section 422 of
                           the Code or any successor provision thereto.

                  (k)      "Non Qualified Stock Option" means an Option that is
                           not intended to be an Incentive Stock Option, but
                           shall include any Option intended as an Incentive
                           Stock Option that fails to meet the requirements
                           thereof.

                  (l)      "Option" means a right that is granted to a
                           Participant under Article 7 of the Plan to purchase
                           Stock at a specified price during specified time
                           periods. An Option may be either an Incentive Stock
                           Option or a Non Qualified Stock Option.

                  (m)      "Participant" means a person whom, as an officer,
                           director, employee, consultant, or independent
                           contractor of the Company or any Subsidiary, has been
                           granted an Award under the Plan.

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                  (n)      "Performance Share" means a right granted to a
                           Participant under Article 9, to receive cash, Stock,
                           or other Awards, the payment of which is contingent
                           upon achieving certain performance goals established
                           by the Committee.

                  (o)      "Plan" means the Integrated Information Systems, Inc.
                           1997 Long-Term Incentive Plan, as amended from time
                           to time.

                  (p)      "Restricted Stock Award" means Stock granted to a
                           Participant under Article 10 that is subject to
                           certain restrictions and to risk of forfeiture.

                  (q)      "Retirement" means retirement from active service as
                           an officer or employee of the Company on or after
                           attaining age 60 after completing ten years of
                           service with the Company.

                  (r)      "Stock" means the common stock of the Company and
                           such other securities of the Company that may be
                           substituted for Stock pursuant to Article 11.

                  (s)      "Stock Appreciation Right" or "SAR" means a right
                           granted to a Participant under Article 8 to receive a
                           payment equal to the difference between the Fair
                           Market Value of a share of Stock as of the date of
                           exercise of the SAR over the grant price of the SAR,
                           all as determined pursuant to Article 8.

                  (t)      "Subsidiary" means any corporation of which a
                           majority of the outstanding voting stock or voting
                           power is beneficially owned, directly or indirectly,
                           by the Company.

ARTICLE 4         ADMINISTRATION

         4.1      COMMITTEE. The Plan shall be administered by a committee (the
                  "Committee") that is appointed by, and shall serve at the
                  discretion of, the Board.

         4.2      ACTION BY THE COMMITTEE. A majority of the Committee shall
                  constitute a quorum. The acts of majority of the members
                  present at any meeting at which a quorum is present and acts
                  approved in writing by a majority of the Committee in lieu of
                  a meeting shall be deemed the acts of the Committee. Each
                  member of the Committee is entitled to, in good faith, rely or
                  act upon any report or other information furnished to that
                  member by any officer or other employee of the Company or any
                  Subsidiary, the Company's independent certified public
                  accountants, or any executive compensation consultant or other
                  professional retained by the Company to assist in the
                  administration of the Plan.

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         4.3      AUTHORITY OF COMMITTEE. The Committee has the exclusive power,
                  authority and discretion to:

                  (a)      Designate Participants to receive Awards;

                  (b)      Determine the type or types of Awards to be granted
                           to each Participant;

                  (c)      Determine the number of Awards to be granted and the
                           number of shares of Stock to which an Award will
                           relate;

                  (d)      Determine the terms and conditions of any Award
                           granted under the Plan including but not limited to,
                           the exercise price, grant price, or purchase price,
                           any restrictions or limitations on the Award, any
                           schedule for lapse or forfeiture restrictions or
                           restrictions on the exercisability of an Award, and
                           accelerations or waivers thereof, based in each case
                           on such considerations as the Committee in its sole
                           discretion determines;

                  (e)      Determine whether, to what extent, and under what
                           circumstances an Award may be settled in, or the
                           exercise price of an Award may be paid in, cash,
                           Stock, other Awards, or other property, or an Award
                           may be canceled, forfeited, or surrendered;

                  (f)      Prescribe the form of each Award Agreement, which
                           need not be identical for each Participant;

                  (g)      Decide all other matters that must be determined in
                           connection with an Award;

                  (h)      Establish, adopt or revise any rules and regulations
                           as it may deem necessary or advisable to administer
                           the Plan;

                  (i)      Interpret the Plan and any agreements defining the
                           rights and/or obligations of the Company; and

                  (j)      Make all other decisions and determinations that may
                           be required under the Plan or as the Committee deems
                           necessary or advisable to administer the Plan.

         4.4      DECISIONS BINDING. The Committees interpretation of the Plan,
                  any Awards granted under the Plan, any Award Agreement and all
                  decisions and determinations by the Committee with respect to
                  the Plan are final, binding, and conclusive on all parties.

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ARTICLE 5         SHARES SUBJECT TO THE PLAN

         5.1      NUMBER OF SHARES. Subject to adjustment provided in Section
                  12.1, the aggregate number of shares of Stock reserved and
                  available for grant under the Plan shall be two million
                  (2,000,000) shares.

         5.2      LAPSED AWARDS. To the extent that an Award terminates,
                  expires, or lapses for any reason, any shares of Stock subject
                  to the Award will again be available for the grant of an Award
                  under the Plan and shares subject to SARs or other Awards
                  settled in cash will be available for the grant of an Award
                  under the Plan.

         5.3      STOCK DISTRIBUTED. Any Stock distributed pursuant to an Award
                  may consist, in whole or in part, of authorized and unissued
                  Stock, treasury stock, or Stock purchased on the open market.

ARTICLE 6         ELIGIBILITY AND PARTICIPATION

         6.1      ELIGIBILITY. Persons eligible to participate in this Plan
                  include all officers, directors, employees, consultants, or
                  independent contractors of the Company or a Subsidiary, as
                  determined by the Committee, including employees who are also
                  members of the Board.

         6.2      ACTUAL PARTICIPATION. Subject to the provisions of the Plan,
                  the Committee may, from time to time, select from among all
                  eligible individuals, those to whom Awards shall be granted
                  and shall determine the nature, terms, and amount of each
                  Award pursuant to Section 4.3 of the Plan. No individual shall
                  have any right to be granted an Award under this Plan.

         6.3      EVIDENCE OF AWARD. All Awards shall be evidenced by a written
                  Award Agreement between the Company and the Participant. The
                  Award Agreement shall include such provisions as may be
                  specified by the Committee.

ARTICLE 7         STOCK OPTIONS

         7.1      GENERAL. The Committee is authorized to grant Options to
                  Participants on the following terms and conditions:

                  (a)      EXERCISE PRICE. The exercise price per share of Stock
                           under an Option shall be determined by the Committee
                           and set forth in the Award Agreement. It is the
                           intention under the Plan that the exercise price for
                           any Option shall not be less than the Fair Market
                           Value as of the date of grant; provided, however,
                           that the Committee may, in its discretion, grant
                           Options (other than Incentive Stock Options with an
                           exercise price of less than Fair Market Value on the
                           date of grant.

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                  (b)      TIME AND CONDITIONS OF EXERCISE. The Committee shall
                           determine the time or times at which an Option may be
                           exercised in whole or in part and the time or times
                           at which an Option will lapse. The Committee also
                           shall determine the performance of other conditions,
                           if any, which must be satisfied before all or part of
                           an Option may be exercised. Such conditions will be
                           set forth in the Award Agreement.

                  (c)      PAYMENT. The Committee shall determine the methods by
                           which the exercise price of an Option may be paid,
                           the form of payment, including, without limitation,
                           cash, shares of Stock, or other property (including
                           broker-assisted "cashless exercise" arrangements),
                           and the methods by which shares of Stock shall be
                           delivered or deemed to be delivered to Participants.

         7.2      INCENTIVE STOCK OPTIONS. Incentive Stock Options shall be
                  granted only to employees of the Company and the terms of any
                  Incentive Stock Options panted under the Plan must comply with
                  the following additional rules:

                  (a)      EXERCISE PRICE. The Committee shall set the exercise
                           price per share of Stock, provided that the exercise
                           price for any Incentive Stock Option may not be less
                           than the Fair Market Value as of the date of the
                           grant.

                  (b)      EXERCISE. In no event, may any Incentive Stock Option
                           be exercisable for more than ten years from the date
                           of its grant.

                  (c)      LAPSE OF OPTION. An Incentive Stock Option shall
                           lapse under the following circumstances:

                           (1)      An Incentive Stock Option shall lapse ten
                                    years from the date it is granted. unless an
                                    earlier time is set in the Award Agreement.

                           (2)      An Incentive Stock Option shall lapse three
                                    (3) months after the Participants
                                    termination of employment if the termination
                                    of employment was attributable to: (i)
                                    Disability; (ii) Retirement; or (iii) any
                                    other reason, provided that the Committee
                                    has approved, in wilting, the continuation
                                    of any Incentive Stock Option outstanding on
                                    the date of the Participant's termination of
                                    employment.

                           (3)      Unless otherwise determined by the
                                    Committee, an Incentive Stock Option shall
                                    lapse seven (7) days following the
                                    Participants termination of employment if
                                    the termination of employment was a For
                                    Cause Termination.

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                           (4)      Unless otherwise determined by the
                                    Committee, an Incentive Stock Option shall
                                    lapse seven (7) days following employee's
                                    receipt of a written notice from Company
                                    that the Company has determined, in good
                                    faith, that the employee has breached the
                                    terms of any agreement between the
                                    Participant and the Company relating to the
                                    Participant's employment with the Company.

                           (5)      If a Participant dies before the Option
                                    lapses pursuant to paragraph (1), (2), (3),
                                    or (4) above, the Incentive Stock Option
                                    shall lapse, unless it is previously
                                    exercised, on the earlier of: (i) the date
                                    on which the Option would have lapsed had
                                    the Participant lived and had his/her
                                    employment status (i.e., whether the
                                    Participant was employed by the Company on
                                    the date of his/her death or had previously
                                    terminated employment) remained unchanged;
                                    or (ii) twelve (12) months after the date of
                                    the Participant's death. Upon the
                                    Participant's death, any Incentive Stock
                                    Options exercisable at the Participant's
                                    death may be exercised by the Participant's
                                    legal representative or representatives, by
                                    the person or persons entitled to do so
                                    under the Participant's last will and
                                    testament, or, if the Participant shall fail
                                    to make testamentary disposition of such
                                    Incentive Stock Option or shall die
                                    intestate, by the person or persons entitled
                                    to receive said Incentive Stock Option under
                                    the applicable laws of descent and
                                    distribution.

                  (d)      INDIVIDUAL DOLLAR LIMITATION. The aggregate Fair
                           Market Value (determined as of the time an Award is
                           made) of all shares of Stock with respect to which
                           Incentive Stock Options are first exercisable by a
                           Participant in any calendar year may not exceed
                           $100,000.00 or such other limitation as imposed by
                           Section 422(d) of the Code, or any successor
                           provision. To the extent that Incentive Stock Options
                           are first exercisable by a Participant in excess of
                           such limitation, the excess shall be considered Non
                           Qualified Stock Options.

                  (e)      TEN PERCENT OWNERS. An Incentive Stock Option shall
                           be granted to any individual who, at the date of
                           grant, owns stock possessing more than ten percent of
                           the total combined voting power of all classes of
                           Stock of the Company only if such Option is granted
                           at a price that is not less than 110% of Fair Market
                           Value on the date of grant and the Option is
                           exercisable for no more than five years from the date
                           of grant.

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                  (f)      EXPIRATION OF INCENTIVE STOCK OPTIONS. No Award of an
                           Incentive Stock Option may be made pursuant to this
                           Plan after the tenth anniversary of the Effective
                           Date.

                  (g)      RIGHT TO EXERCISE. During a Participant's lifetime,
                           an Incentive Stock Option may be exercised only by
                           the Participant.

ARTICLE 8         STOCK APPRECIATION RIGHTS

         8.1      GRANT OF SARs. The Committee is authorized to grant SARs to
                  Participants on the following terms and conditions:

                  (a)      RIGHT TO PAYMENT. Upon the exercise of a Stock
                           Appreciation Right, the Participant to whom the SAR
                           is granted has the right to receive the excess, if
                           any, of:

                           (1)      The Fair Market Value of a share of Stock on
                                    the date of exercise; minus;

                           (2)      The grant price of the Stock Appreciation
                                    Right as determined by the Committee, which
                                    shall not be less, than the Fair Market
                                    Value of a share of Stock on the date of
                                    grant in the case of any SAR related to any
                                    Incentive Stock Option.

                  (b)      OTHER TERMS. All awards of Stock Appreciation Rights
                           shall be evidenced by an Award Agreement. The terms,
                           methods of exercise, methods of settlement, form of
                           consideration payable in settlement, and any other
                           terms and conditions of any Stock Appreciation Right
                           shall be determined by the Committee at the time of
                           the grant of the Award and shall be reflected in the
                           Award Agreement.

ARTICLE 9         PERFORMANCE SHARES

         9.1      GRANT OF PERFORMANCE SHARES. The Committee is authorized to
                  grant Performance Shares to Participants on such terms and
                  conditions as may be selected by the Committee. The Committee
                  shall have the complete discretion to determine the number of
                  Performance Shares granted to each Participant. All Awards of
                  Performance Shares shall be evidenced by an Award Agreement.

         9.2      RIGHT TO PAYMENT. A grant of Performance Shares gives the
                  Participant rights, valued as determined by the Committee, and
                  payable to, or exercisable by, the Participant to whom the
                  Performance Shares are granted, in whole or in part, as the
                  Committee shall establish at grant or thereafter. The
                  Committee shall set performance goals and other terms or
                  conditions to payment of the Performance Shares in its
                  discretion which,

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                  depending on the extent to which they are met, will determine
                  the number and value of Performance Shares that will be paid
                  to the Participant, provided that the time period during which
                  the performance goals must be met shall, in all cases, exceed
                  six months.

         9.3      OTHER TERMS. Performance Shares may be payable in cash, Stock,
                  or other property, and have such other terms and conditions as
                  determined by the Committee and reflected in the Award
                  Agreement.

ARTICLE 10        RESTRICTED STOCK AWARDS

         10.1     GRANT OF RESTRICTED STOCK. The Committee is authorized to make
                  Awards of Restricted Stock to Participants in such amounts and
                  subject to such terms and conditions as may be selected by the
                  Committee. All Awards of Restricted Stock shall be evidenced
                  by a Restricted Stock Award Agreement.

         10.2     ISSUANCE AND RESTRICTIONS. Restricted Stock shall be subject
                  to such restrictions on transferability and other restrictions
                  as the Committee may impose (including, without limitation,
                  limitations on the right to vote Restricted Stock or the right
                  to receive dividends on the Restricted Stock). These
                  restrictions may lapse separately or in combination at such
                  times, under such circumstances, in such installments, or
                  otherwise, as the Committee determines at the time of the
                  grant of the Award or thereafter.

         10.3     FORFEITURE. Except as otherwise determined by the Committee at
                  the time of the grant of the Award or thereafter, upon
                  termination of employment during the applicable restriction
                  period. Restricted Stock that is at that time subject to
                  restrictions shall be forfeited and reacquired by the Company,
                  provided, however, that the Committee may provide in any Award
                  Agreement that restrictions or forfeiture conditions relating
                  to Restricted Stock will be waived in whole or in part in the
                  event of terminations resulting from specified causes, and the
                  Committee may in other cases waive, in whole or in part,
                  restrictions or forfeiture conditions relating to Restricted
                  Stock.

         10.4     CERTIFICATES FOR RESTRICTED STOCK. Restricted Stock granted
                  under the Plan may be evidenced in such manner as the
                  Committee shall determine. If certificates representing shares
                  of Restricted Stock are registered in the name of the
                  Participant, certificates must bear an appropriate legend
                  referring to the terms, conditions, and restrictions
                  applicable to such Restricted Stock, and the Company shall
                  retain physical possession of the certificate until such time
                  as all applicable restrictions lapse.

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ARTICLE 11        PROVISIONS APPLICABLE TO AWARDS

         11.1     STAND-ALONE, TANDEM, AND SUBSTITUTE AWARDS. Awards granted
                  under the Plan may, in the discretion of the Committee, be
                  granted either alone or in addition to, in tandem with, or in
                  substitution for, any other Award granted under the Plan. If
                  an Award is granted in substitution for another Award, the
                  Committee may require the surrender of such other Award in
                  consideration of the grant of the new Award. Awards granted in
                  addition to or in tandem with other Awards may be granted
                  either at the same time as or at a different time from the
                  grant of such other Awards.

         11.2     EXCHANGE PROVISIONS. The Committee may at any time offer to
                  exchange or buy out any previously granted Award for a payment
                  in cash, Stock, or another Award (subject to Section 11.1),
                  based on the terms and conditions the Committee determines and
                  communicates to the Participant at the time the offer is made.

         11.3     TERM OF AWARD. The term of each Award shall be for the period
                  as determined by the Committee, provided that in no event
                  shall the term of any Incentive Stock Option or a Stock
                  Appreciation Right granted in tandem with the Incentive Stock
                  Option exceed a period often years from the date of its grant.

         11.4     FORM OF PAYMENT FOR AWARDS. Subject to the terms of the Plan
                  and any applicable law or Award Agreement, payments or
                  transfers to be made by the Company or a Subsidiary on the
                  grant or exercise of an Award may be made in such forms as the
                  Committee determines at or after the time of grant, including
                  without limitation, cash, Stock, other Awards, or other
                  property, or any combination, and may be made in a single
                  payment or transfer, in installments, or on a deferred basis,
                  in each case determined in accordance with rules adopted by,
                  and at the discretion of the Committee.

         11.5     LIMITS ON TRANSFER. No right or interest of a Participant in
                  any Award may be pledged, encumbered, or hypothecated to or in
                  favor of any party other than the Company or a Subsidiary, or
                  shall be subject to any lien, obligation, or liability of such
                  Participant to any other party other than the Company or a
                  Subsidiary. Except as otherwise provided by the Committee, no
                  Award shall be assignable or transferable by a Participant
                  other than by will or the laws of descent and distribution.

         11.6     BENEFICIARIES. Notwithstanding Section 11.5, a Participant
                  may, in the manner determined by the Committee, designate a
                  beneficiary to exercise the rights of the Participant and to
                  receive any distribution with respect to any Award upon the
                  Participant's death. A beneficiary, legal guardian, legal
                  representative, or other person claiming any rights under the
                  Plan (collectively a "Beneficiary") is subject to all terms
                  and

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                  conditions of the Plan and any Award Agreement applicable to
                  the Participant, except to the extent the Plan and Award
                  Agreement otherwise provide, and to any additional
                  restrictions deemed necessary or appropriate by the Committee.
                  If the Participant is married, a designation of a person other
                  than the Participant's spouse as his/her Beneficiary with
                  respect to more than fifty percent (50%) of the Participant's
                  interest in the Award shall not be effective without the
                  written consent of the Participant's spouse. If no beneficiary
                  has been designated or survives the Participant, payment shall
                  be made to the person entitled thereto under the Participant's
                  will or the laws of descent and distribution. Subject to the
                  foregoing, a Beneficiary designation may be changed or revoked
                  by a Participant at any time provided the change or revocation
                  is filed with the Committee.

         11.7     STOCK CERTIFICATES. All Stock certificates delivered under the
                  Plan are subject to any stop-transfer orders and other
                  restrictions as the Committee deems necessary or advisable to
                  comply with Federal or state securities laws, rules and
                  regulations and the rules of any national securities exchange
                  or automated quotation system on which the Stock is listed,
                  quoted, or traded. The Committee may place legends on any
                  Stock certificate to reference restrictions applicable to the
                  Stock.

         11.8     TENDER OFFERS. In the event of a public tender for all or any
                  portion of the Stock, or in the event that a proposal to
                  merge, consolidate, or otherwise combine with another company
                  is submitted for stockholder approval, the Committee may in
                  its sole discretion declare previously granted Options to be
                  immediately exercisable. To the extent that this provision
                  causes Incentive Stock Options to exceed the dollar limitation
                  set forth in Section 7.2(d), the excess Options shall be
                  deemed to be Non Qualified Stock Options.

         11.9     ACCELERATION UPON A CHANGE OF CONTROL. If so provided in a
                  Participant's Award Agreement, if a Change of Control occurs,
                  all outstanding Options, Stock Appreciation Rights, and other
                  Awards shall become fully exercisable and all restrictions on
                  outstanding Awards shall lapse. To the extent that this
                  provision causes Incentive Stock Options to exceed the dollar
                  limitation set forth in Section 7.2(d), the excess Options
                  shall be deemed to be Non Qualified Stock Options. Upon, or in
                  anticipation of such an event, the Committee may cause every
                  Award outstanding hereunder to terminate at a specific time in
                  the future and shall give each Participant the right to
                  exercise Awards during a period of time as the Committee, in
                  its sole and absolute discretion, shall determine, except in
                  the event that the surviving or resulting entity agrees to
                  assume the Awards on terms and conditions that substantially
                  preserve the Participant's rights and benefits of the Award
                  then outstanding.

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         11.10    PROVISIONS FOR EXERCISE. No Award shall be exercisable or
                  shall vest until the date provided in the applicable Award
                  Agreement. Once exercisable, an Award shall remain exercisable
                  until expiration or earlier termination of the Award, unless
                  the Committee otherwise provides.

ARTICLE 12        CHANGES IN CAPITAL STRUCTURE

         12.1     GENERAL. In the event a stock dividend is declared upon the
                  Stock, the shares of Stock then subject to each Award (and the
                  number of shares subject thereto) shall be increased
                  proportionately without any change in the aggregate purchase
                  price therefor. In the event the Stock shall be changed into
                  or exchanged for a different number or class of shares of
                  Stock or of another corporation, whether through
                  reorganization, recapitalization, stock split, combination of
                  shares, merger or consolidation, there shall be substituted
                  for each such share of Stock then subject to each Award (and
                  for each share of Stock then subject thereto) the number and
                  class of shares of Stock into which each outstanding share of
                  Stock shall be so exchanged, all without any change in the
                  aggregate purchase price for the shares then subject to each
                  Award.

ARTICLE 13        AMENDMENT, MODIFICATION AND TERMINATION

         13.1     AMENDMENT, MODIFICATION AND TERMINATION. With the approval of
                  the Board, at any time and from time to time, the Committee
                  may terminate, amend, or modify the Plan.

         13.2     AWARDS PREVIOUSLY GRANTED. No termination, amendment, or
                  modification of the Plan shall adversely affect in any
                  material way any Award previously granted under the Plan,
                  without the written consent of the Participant.

ARTICLE 14        GENERAL PROVISIONS

         14.1     NO RIGHTS TO AWARDS. No Participant, employee, or other person
                  shall have any claim to be granted any Award under the Plan,
                  and neither the Company nor the Committee is obligated to
                  treat Participants, employees, and other persons uniformly.

         14.2     NO STOCKHOLDERS' RIGHTS. No Award gives the Participant any of
                  the rights of a stockholder of the Company unless and until
                  shares of Stock are in fact issued to such person in
                  connection with such Award.

         4.3      SHAREHOLDERS' AGREEMENTS. Upon the exercise of an Award, the
                  Company shall have the right, at its option, to require the
                  Participant (or Beneficiary) to execute a separate
                  shareholders' agreement in order to effectuate such exercise.
                  Any shareholders' agreement will be uniform in content and
                  applicable to all Participants under the Plan.

                                       13
<PAGE>   15
         4.4      WITHHOLDING. The Company or any Subsidiary shall have the
                  authority and the right to deduct or withhold, or require a
                  Participant to remit to the Company, an amount sufficient to
                  satisfy Federal, state, and local taxes (including the
                  Participant's FICA obligation) required by law to be withheld
                  with respect to any taxable event arising as a result of this
                  Plan.

         4.5      NO RIGHT TO EMPLOYMENT. Nothing in the Plan or any Award
                  Agreement shall interfere with or limit in any way the right
                  of the Company or any Subsidiary to terminate any
                  Participant's employment at any time, or confer upon any
                  Participant any right to continue in the employ of the Company
                  or any Subsidiary.

         14.6     UNFUNDED STATUS OF AWARDS. The Plan is intended to be an
                  "unfunded" plan for incentive compensation. With respect to
                  any payments not yet made to a Participant pursuant to an
                  Award, nothing contained in the Plan or any Award Agreement
                  shall give the Participant any rights that are greater than
                  those of a general creditor of the Company or any Subsidiary.

         14.7     INDEMNIFICATION. To the extent allowable under applicable law,
                  each member of the Committee or of the Board shall be
                  indemnified and held harmless by the Company from any loss,
                  cost, liability, or expense that may be imposed upon or
                  reasonably incurred by such member in connection with or
                  resulting from any claim, action, suit, or proceeding to which
                  he or she may be a party or in which he or she may be involved
                  by reason of any action or failure to act under the Plan and
                  against and from any and all amounts paid by him or her in
                  satisfaction of judgment in such action, suit, or proceeding
                  against him or her provided he or she gives the Company an
                  opportunity, at its own expense, to handle and defend the same
                  before he or she undertakes to handle and defend it on his or
                  her own behalf. The foregoing right of indemnification shall
                  not be exclusive of any other rights of indemnification to
                  which such persons may be entitled under the Company's
                  Articles of Incorporation or By-Laws, as a matter of law, or
                  otherwise, or any power that the Company may have to indemnify
                  them or hold them harmless.

         14.8     RELATIONSHIP TO OTHER BENEFITS. No payment under the Plan
                  shall be taken into account in determining any benefits under
                  any pension, retirement, savings, profit sharing, group
                  insurance, welfare or other benefit plan of the Company or any
                  Subsidiary.

         14.9     EXPENSES. The expenses of administering the Plan shall be
                  borne by the Company and its Subsidiaries.

         14.10    TITLES AND HEADINGS. The titles and headings of the Sections
                  in the Plan are for convenience of reference only, and in the
                  event of any

                                       14
<PAGE>   16
                  conflict, the text of the Plan, rather than such titles or
                  headings, shall control.

         14.11    FRACTIONAL SHARES. No fractional shares of stock shall be
                  issued and the Committee shall determine, in its discretion,
                  whether cash shall be given in lieu of fractional shares or
                  whether such fractional shares shall be eliminated by rounding
                  up.

         14.12    GOVERNMENT AND OTHER REGULATIONS. The obligation of the
                  Company to make payment of awards in Stock or otherwise shall
                  be subject to all applicable laws, rules, and regulations, and
                  to such approvals by government agencies as may be required.
                  The Company shall be under no obligation to register under the
                  Securities Act of 1933, as amended (the "1933 Act"), any of
                  the shares of Stock paid under the Plan. If the shares paid
                  under the Plan may in certain circumstances be exempt from
                  registration under the 1933 Act, the Company may restrict the
                  transfer of such shares in such manner as it deems advisable
                  to ensure the availability of any such exemption.

         14.13    GOVERNING LAW. The Plan and all Award Agreements shall be
                  construed in accordance with and governed by the laws of the
                  State of Arizona.

INTEGRATED INFORMATION SYSTEMS, INC.

____________________________________
BY:      JAMES G. GARVEY
         PRESIDENT AND CHIEF EXECUTIVE OFFICER

                                       15
<PAGE>   17

                               FIRST AMENDMENT TO
                      INTEGRATED INFORMATION SYSTEMS, INC.
                          1997 LONG-TERM INCENTIVE PLAN

      Integrated Information Systems, Inc. (the "Company") previously approved
the adoption of the Integrated Information Systems, Inc. 1997 Long-Term
Incentive Plan (the "Plan") to provide certain employees, directors, and
consultants or independent contractors with an incentive for outstanding
performance. By this instrument, the Company desires to amend the Plan to
increase the maximum aggregate number of shares of common stock of the Company
to be reserved and available under the Plan.

      1. The provisions of this First Amendment shall be effective as of date
indicated below.

      2. Section 5.1 (Number of Shares) of the Plan is hereby amended and
restated in its entirety as follows:

             5.1 NUMBER OF SHARES. Subject to adjustment as provided in Section
      12.1 below, the aggregate number of shares of Stock reserved and available
      for grant under the Plan shall be four million five hundred thousand
      (4,500,000) shares.

      3. This First Amendment shall amend only the provisions of the Plan as set
forth herein. Those provisions of the Plan not expressly amended hereby shall be
considered in full force and effect.

      IN WITNESS WHEREOF, the Company has caused this First Amendment to be
executed on this _____________ day of ______________________________________,
2000.
                                    INTEGRATED INFORMATION SYSTEMS, INC.

                                    By:
                                       -------------------------------------

                                     Its:
                                       -------------------------------------<PAGE>   1
                                                                    EXHIBIT 10.2

                      INTEGRATED INFORMATION SYSTEMS, INC.
                        2000 EMPLOYEE STOCK PURCHASE PLAN

      1.    PURPOSE.  The purpose of this Integrated Information Systems,
Inc. 2000 Employee Stock Purchase Plan (the "Plan") is to encourage stock
ownership by eligible employees of Integrated Information Systems, Inc. (the
"Company") and its Subsidiaries and thereby provide employees with an
incentive to contribute to the profitability and success of the Company.  The
Plan is intended to qualify as an "employee stock purchase plan" under
Section 423 of the Code and will be maintained for the exclusive benefit of
eligible employees of the Company and its Subsidiaries.

      2.    DEFINITIONS.  For purposes of the Plan, in addition to the terms
defined in Section 1, the following terms are defined:

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

            (b)   "Cash Account" means the account maintained on behalf of a
Participant by the Company for the purpose of holding cash contributions
withheld from payroll pending investment in Stock.

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

            (d)   "Custodian" means the registrar and transfer agent for the
Company's Stock, or any successor or replacement appointed by the Board or
its delagatee under Section 3(a).

            (e)   "Earnings" means a Participant's salary or wages for
services performed for the Company and its Subsidiaries and received by a
Participant for services rendered during an Offering Period.

            (f)   "Fair Market Value" means the closing price of the Stock on
the relevant date as reported on NASDAQ (or any national securities exchange
or quotation system on which the Stock is then listed), or if there were no
sales on that date the closing price on the next preceding date for which a
closing price was reported.

            (g)   "Offering Period" means the six-month period beginning
January 1, 2000 and ending June 30, 2000, and every six month period
thereafter, with the second Offering Period to begin on July 1, 2000 and
ending December 31, 2000; provided, however, that during the year 2000, the
first offering period shall begin on the consummation of the Company's
initial public offering of Stock (the "First Commencement Date") and shall
end on either (i) June 30, 2000, or, (ii) if the First Commencement Date is
after June 30, 2000, then December 31, 2000.

            (h)   "Participant" means an employee of the Company or a
Subsidiary who is participating in the Plan.
<PAGE>   2
            (i)   "Purchase Right" means a Participant's option to purchase
Stock that is deemed to be outstanding during a Offering Period.  A Purchase
Right represents an "option" under Section 423 of the Code.

            (j)   "Stock" means the common stock of the Company.

            (k)   "Stock Account" means the account maintained on behalf of
the Participant by the Custodian for the purpose of holding Stock acquired
under the Plan.

            (l)   "Subsidiary" means any corporation (other than the Company)
in an unbroken chain of corporations beginning with the Company if each of
the corporations (other than the last corporation in the unbroken chain) owns
stock possessing 50% or more of the total combined voting power of all
classes of stock in one of the other corporations in the chain as set forth
in Code Section 424(f).

      3.    ADMINISTRATION.

            (a)   Board Administration.  The Plan will be administered by the
Board.  The Board may delegate its administrative duties and authority (other
than its authority to amend the Plan) to any Board committee or to any
officers or employees or committee thereof as the Board may designate (in
which case references to the Board will be deemed to refer to the
administrator to which such duties and authority have been delegated).  The
Board will have full authority to adopt, amend, suspend, waive, and rescind
rules and regulations and appoint agents as it deems necessary or advisable
to administer the Plan, to correct any defect or supply any omission or
reconcile any inconsistency in the Plan and to construe and interpret the
Plan and rules and regulations thereunder, to furnish to the Custodian such
information as the Custodian may require, and to make all other decisions and
determinations under the Plan (including determinations relating to
eligibility).  No person acting in connection with the administration of the
Plan will, in that capacity, participate in deciding any matter relating to
his or her participation in the Plan.

            (b)   The Custodian.  The Custodian will act as custodian under
the Plan, and will perform duties under the Plan and in any agreement between
the Company and the Custodian.  The Custodian will establish and maintain
Participants Stock Accounts and any subaccounts as may be necessary or
desirable to administer the Plan.

            (c)   Waivers.  The Board may waive or modify any requirement
that a notice or election be made or filed under the Plan a specified period
in advance on an individual case or by adopting a rule or regulation under
the Plan, without amending the Plan.

            (d)   Other Administrative Provisions.  The Company will furnish
information from its records as directed by the Board, and such records,
including a Participant's Earnings, will be conclusive on all persons unless
determined by the Board to be incorrect.  Each Participant and other person
claiming benefits under the Plan must furnish to the Company in writing an
up-to-date mailing address and any other information as the Board or
Custodian may reasonably request.  Any communication, statement, or notice
mailed with postage prepaid to any such Participant or other person at the
last mailing address filed with the Company will be deemed sufficiently given
when mailed and will be binding upon the named recipient.  The Plan

                                      -2-
<PAGE>   3
will be administered on a reasonable and nondiscriminatory basis and uniform
rules will apply to all persons similarly situated. All Participants will have
equal rights and privileges (subject to the terms of the Plan) with respect to
Purchase Right outstanding during any given Offering Period.

      4.    STOCK SUBJECT TO PLAN.  Subject to adjustment as provided below,
the total number of shares of Stock reserved and available for issuance or
which may be otherwise acquired upon exercise of Purchase Rights under the
Plan will be 400,000.  Any shares of Stock delivered by the Company under the
Plan may consist, in whole or in part, of authorized and unissued shares or
treasury shares.  The number and kind of such shares of Stock subject to the
Plan will be proportionately adjusted, as determined by the Board, in the
event of any extraordinary dividend or other distribution, recapitalization,
forward or reverse split, reorganization, merger, consolidation, spin-off,
combination, repurchase, or share exchange, or other similar corporate
transaction or event affecting the Stock.

      5.    ENROLLMENT AND CONTRIBUTIONS.

            (a)   Eligibility.  An employee of the Company or a Subsidiary
may be enrolled in the Plan for any Offering Period if such employee is
employed by the Company or a Subsidiary on the first day of the Offering
Period, unless one of the following applies to the employee:

                  (i)   such person has been employed by the Company or a
                        Subsidiary less than 2 years; or

                  (ii)  such person is customarily employed by the Company or
                        a Subsidiary for 20 hours or less a week; or

                  (iii) such person is customarily employed by the Company or
                        a Subsidiary for not more than five months in any
                        calendar year;

                  (iv)  such person is a "highly compensated employee" within
                        the meaning of Section 414(q) of the Code; or

                  (v)   such person would, immediately upon enrollment, be
                        deemed to own, for purposes of Section 423(b)(3) of
                        the Code, an aggregate of five percent or more of the
                        total combined voting power or value of all
                        outstanding shares of all classes of the Company or
                        any Subsidiary.

The Company will notify an employee of the date as of which he or she is
eligible to enroll in the Plan, and will make available to each eligible
employee the necessary enrollment forms.  Notwithstanding the above, any
individual who is employed by the Company or a Subsidiary and who is working
outside of the United States shall not be eligible to participate in the Plan
if the laws of the country in which the employee is working makes the offer
of the Purchase Right or the delivery of Stock under the Plan impractical.
Additionally, the offer of the Purchase Right and the delivery of Stock under
the Plan shall only be effective for any individual who is employed by the
Company or a Subsidiary and who is working outside of the United States only

                                      -3-
<PAGE>   4
after the Company has complied with the applicable laws of the country in
which the employee is working.

            (b)   Initial Enrollment.  An employee who is eligible under
Section 5(a) (or who will become eligible on or before a given Offering
Period) may, after receiving current information about the Plan, initially
enroll in the Plan by executing and filing with the Company a properly
completed enrollment form, including the employee's election as to the rate
of payroll contributions for the Offering Period.  To be effective for any
Offering Period, such enrollment form must be filed at least two weeks
preceding such Offering Period.

            (c)   Automatic Re-enrollment for Subsequent Offering Periods.  A
Participant whose enrollment in, and payroll contributions under, the Plan
continues throughout a Offering Period will automatically be re-enrolled in
the Plan for the next Offering Period unless (i) the Participant terminates
enrollment before the next Offering Period in accordance with Section 7(a),
or (ii) the Participant is ineligible to participate under Section 5(a).  The
initial rate of payroll contributions for a Participant who is automatically
re-enrolled for a Offering Period will be the same as the rate of payroll
contribution in effect at the end of the preceding Offering Period, unless
the Participant files a new enrollment form designating a different rate of
payroll contributions and such new enrollment form is received no later than
two weeks prior to the beginning of the next Offering Period.

            (d)   Payroll Contributions.  A Participant will make
contributions under the Plan by means of payroll deductions from each payroll
period which ends during the Offering Period, at the rate elected by the
Participant in his or her enrollment form in effect for that Offering Period
(except that such rate may be changed during the Offering Period to the
extent permitted below).  The rate of payroll contributions elected by a
Participant may not be less than one percent (1%) nor more than ten percent
(10%) of the Participant's Earnings for each payroll period, and only whole
percentages may be elected; provided, however, that the Board may specify a
lower minimum rate and higher maximum rate, subject to Section 8(c).
Notwithstanding the above, a Participant's payroll contributions will be
adjusted downward by the Company as necessary to ensure that the limit on the
amount of Stock purchased with respect to a Offering Period set forth in
Section 6(a)(iii) is not exceeded.  A Participant may elect to increase,
decrease, or discontinue payroll contributions for a future Offering Period
by filing a new enrollment form designating a different rate of payroll
contributions, which form must be received at least two weeks prior to the
beginning of an Offering Period to be effective for that Offering Period.  In
addition, a Participant may elect to discontinue payroll contributions during
an Offering Period by filing a new enrollment form, such change to be
effective for the next payroll after the Participant's new enrollment form is
received.

            (e)   Crediting Payroll Contributions to Cash Accounts.  All
payroll contributions by a Participant under the Plan will be credited to a
Cash Account maintained by the Company on behalf of the Participant. The
Company will credit payroll contributions to each Participant's Cash Account
as soon as practicable after the contributions are withheld from the
Participant's Earnings.

            (f)   No Interest on Cash Accounts.  No interest will be credited
or paid on cash balances in Participant's Cash Accounts pending investment in
Stock.

                                      -4-
<PAGE>   5
      6.    PURCHASES OF STOCK

            (a)   Purchase Rights.  Enrollment in the Plan for any Offering
Period by a Participant will constitute a grant by the Company of a Purchase
Right to such Participant for such Offering Period.  Each Purchase Right will
be subject to the following terms:

                  (i)   The purchase price at which Stock will be purchased
                        under a Purchase Right will be as specified in
                        Section 6(c).

                  (ii)  Except as limited in (iii) below, the number of
                        shares of Stock that may be purchased upon exercise
                        of the Purchase Right for a Offering Period will
                        equal the number of shares (including fractional
                        shares) that can be purchased at the purchase price
                        specified in Section 6(c) with the aggregate amount
                        credited to the Participant's Cash Account as of the
                        last day of an Offering Period.

                  (iii) The number of shares of Stock subject to a
                        Participant's Purchase Right for any Offering Period
                        will not exceed the number derived by dividing
                        $12,500 by 100% of the Fair Market Value of one share
                        of Stock on the first day of the Offering Period for
                        the Offering Period.

                  (iv)  The Purchase Right will be automatically exercised on
                        the last day of the Offering Period.
                  (v)   Payments by a Participant for Stock purchased under a
                        Purchase Right will be made only through payroll
                        deduction in accordance with Section 5(d) and (e).

                  (vi)  The Purchase Right will expire on the earlier of the
                        last day of the Offering Period or the date on which
                        the Participant's enrollment in the Plan terminates.

            (b)   Purchase of Stock.  At or as promptly as practicable after
the last day of an Offering Period, amounts credited to each Participant's
Cash Account will be applied by the Company to purchase Stock, in accordance
with the terms of the Plan.  Shares of Stock will be purchased from the
Company.  The Company will aggregate the amounts in all Cash Accounts when
purchasing Stock, and shares purchased will be allocated to each
Participant's Stock Account in proportion to the cash amounts withdrawn from
such Participant's Cash Account.  After completing purchases for each
Offering Period (which will be completed in not more than 15 calendar days
after the last day of an Offering Period), all shares of Stock so purchased
for a Participant will be credited to the Participant's Stock Account.

            (c)   Purchase Price.  The purchase price of each share of Stock
purchased for each Offering Period will equal 85% of the lesser of (i) the
Fair Market Value of a share of Stock on the first day of an Offering Period,
or (ii) the Fair Market Value of a share of Stock on the last day of an
Offering Period.

                                      -5-
<PAGE>   6
            (d)   Dividend Reinvestment; Other Distributions.  Cash dividends
on any Stock credited to a Participant's Stock Account will be automatically
reinvested in additional shares of Stock; such amounts will not be available
in the form of cash to Participants.  The Company will aggregate all
purchases of Stock in connection with dividend reinvestment for a given
dividend payment date.  Purchases of Stock for purposes of dividend
reinvestment will be made as promptly as practicable (but not more than 15
calendar days) after a dividend payment date.  The purchases will be made
directly from the Company at 100% of the Fair Market Value of a share of
Stock on the dividend payment date.  Any shares of Stock distributed as a
dividend or distribution in respect of shares of Stock or in connection with
a split of the Stock credited to a Participant's Stock Account will be
credited to such Account.

            (e)   Withdrawals and Transfers.  Shares of Stock may be
withdrawn from a Participant's Stock Account, in which case one or more
certificates for whole shares may be issued in the name of, and delivered to,
the Participant, with such Participant receiving cash in lieu of fractional
shares based on the Fair Market Value of a share of Stock on the day
preceding the date of withdrawal.  Alternatively, whole shares of Stock may
be withdrawn from a Participant's Stock Account by means of a transfer to a
broker-dealer or financial institution that maintains an account for the
Participant, together with the transfer of cash in lieu of fractional shares
based on the Fair Market Value of a share of Stock on the day preceding the
date of withdrawal.  Participants may not designate any other person to
receive shares of Stock withdrawn or transferred under the Plan.  A
Participant seeking to withdraw or transfer shares of Stock must give
instructions to the Custodian in such manner and form as may be prescribed by
the Custodian, which instructions will be acted upon as promptly as
practicable.  Withdrawals and transfers will be subject to any fees imposed
in accordance with Section 8(a).

            (f)   Excess Account Balances.  If any amounts remain in a Cash
Account following the date on which the Company purchases Stock for an
Offering Period as a result of the limitation set forth in Section 6(a)(iii)
or for any other reason, such amounts will be returned to the Participant  as
promptly as practicable.

      7.    TERMINATION AND DISTRIBUTIONS.

            (a)   Termination of Enrollment.  A Participant's enrollment in
the Plan will terminate upon (i) the beginning of any payroll period or
Offering Period that begins after he or she files a written notice of
termination of enrollment with the Company, provided that such Participant
will continue to be deemed to be enrolled with respect to any completed
Offering Period for which purchases have not been completed, (ii) such time
as the Participant becomes ineligible to participate under Section 5(a) of
the Plan, or (iii) the termination of the Participant's employment by the
Company and its Subsidiaries.  An employee whose enrollment in the Plan
terminates may again enroll in the Plan as of any subsequent Offering Period
that is at least 90 days after such termination of enrollment if he or she
satisfies the eligibility requirements of Section 5(a) as of such Offering
Period.  A Participant's election to discontinue payroll contributions will
not constitute a termination of enrollment.

            (b)   Distribution.  As soon as practicable after a Participant's
enrollment in the Plan terminates, amounts in the Participant's Cash Account
which resulted from payroll contributions will be repaid to the Participant.
The Custodian will continue to maintain the

                                      -6-
<PAGE>   7
Participant's Stock Account for the Participant until the earlier of such
time as the Participant directs the sale of all Stock in the Account, withdraws,
or transfers all Stock in the Account, or one year after the Participant ceases
to be employed by the Company and its Subsidiaries. If a Participant's
termination of enrollment results from his or her death, all amounts payable
will be paid to his or her estate.

      8.    GENERAL.

            (a)   Costs.  Costs and expenses incurred in the administration
of the Plan and maintenance of Accounts will be paid by the Company, to the
extent provided in this Section 8(a).  Any brokerage fees and commissions for
the purchase of Stock under the Plan (including Stock purchased upon
reinvestment of dividends and distributions) will be paid by the Company, but
any brokerage fees and commissions for the sale of Stock under the Plan by a
Participant will be borne by such Participant.  The rate at which such fees
and commissions will be charged to Participants will be determined by the
Custodian or any broker-dealer used by the Custodian (including an affiliate
of the Custodian), and communicated from time to time to Participants.  In
addition, the Custodian may impose or pass through a reasonable fee for the
withdrawal of Stock in the form of stock certificates (as permitted under
Section 6(e)), and reasonable fees for other services unrelated to the
purchase of Stock under the Plan, to the extent approved in writing by the
Company and communicated to Participants.

            (b)   Statements to Participants.  The Participant's statement
will reflect payroll contributions, purchases, sales, and withdrawals and
transfers of shares of Stock and other Plan transactions by appropriate
adjustments to the Participant's Accounts.  The Custodian will, not less
frequently than semi-annually, provide or cause to be provided a written
statement to the Participant showing the transactions in his or her Stock
Account and the date thereof, the number of shares of Stock credited or sold,
the aggregate purchase price paid or sales price received, the purchase or
sales price per share, the brokerage fees and commissions paid (if any), the
total shares held for the Participant's Stock Account (computed to at least
three decimal places), and such other information as agreed to by the
Custodian and the Company.

            (c)   Compliance with Section 423.  It is the intent of the
Company that this Plan comply in all respects with applicable requirements of
Section 423 of the Code and regulations thereunder.  Accordingly, if any
provision of this Plan does not comply with such requirements, such provision
will be construed or deemed amended to the extent necessary to conform to
such requirements.

      9.    GENERAL PROVISIONS.

            (a)   Compliance With Legal and Other Requirements.  The Plan,
the granting and exercising of Purchase Rights hereunder, and the other
obligations of the Company and the Custodian under the Plan will be subject
to all applicable federal and state laws, rules, and regulations, and to such
approvals by any regulatory or governmental agency as may be required.  The
Company may, in its discretion, postpone the issuance or delivery of Stock
upon exercise of Purchase Rights until completion of such registration or
qualification of such Stock or other required action under any federal or
state law, rule, or regulation, or the laws of any country in which employees
of the Company and a Subsidiary who are nonresident aliens and who are

                                      -7-
<PAGE>   8
eligible to participate reside, or other required action with respect to any
automated quotation system or stock exchange upon which the Stock or other
Company securities are designated or listed, or compliance with any other
contractual obligation of the Company, as the Company may consider
appropriate, and may require any Participant to make such representations and
furnish such information as it may consider appropriate in connection with
the issuance or delivery of Stock in compliance with applicable laws, rules,
and regulations, designation or listing requirements, or other contractual
obligations.

            (b)   Limits on Encumbering Rights.  No right or interest of a
Participant under the Plan, including any Purchase Right, may be pledged,
encumbered, or hypothecated to or in favor of any party, subject to any lien,
obligation, or liability of such Participant, or otherwise assigned,
transferred, or disposed of except pursuant to the laws of descent or
distribution, and any right of a Participant under the Plan will be
exercisable during the Participant's lifetime only by the Participant.

            (c)   No Right to Continued Employment.  Neither the Plan nor any
action taken hereunder, including the grant of a Purchase Right, will be
construed as giving any employee the right to be retained in the employ of
the Company or any of its Subsidiaries, nor will it interfere in any way with
the right of the Company or any of its Subsidiaries to terminate any
employee's employment at any time.

            (d)   Taxes.  The Company or any Subsidiary is authorized to
withhold from any payment to be made to a Participant, including any payroll
and other payments not related to the Plan, amounts of withholding and other
taxes due in connection with any transaction under the Plan, and a
Participant's enrollment in the Plan will be deemed to constitute his or her
consent to such withholding.  In addition, Participants may be required to
advise the Company of sales and other dispositions of Stock acquired under
the plan in order to permit the Company to comply with tax laws and to claim
any tax deductions to which the Company may be entitled with respect to the
Plan.  This provision and other Plan provisions do not set forth an
explanation of the tax consequences to Participants under the Plan.  A brief
summary of the tax consequences will be included in disclosure documents to
be separately furnished to Participants.

            (e)   Changes to the Plan.  The Board may amend, alter, suspend,
discontinue, or terminate the Plan without the consent of shareholders or
Participants, except that any such action will be subject to the approval of
the Company's shareholders within one year after such Board action if such
shareholder approval is required by any federal or state law or regulation or
the rules of any automated quotation system or stock exchange on which the
Stock may then be quoted or listed, or if such shareholder approval is
necessary in order for the Plan to continue to meet the requirements of
Section 423 of the Code, and the Board may otherwise, in its discretion,
determine to submit other such actions to shareholders for approval.
However, without the consent of an affected Participant, no amendment,
alteration, suspension, discontinuation, or termination of the Plan may
materially and adversely affect the rights of such Participant with respect
to outstanding Purchase Rights relating to any Offering Period that has been
completed prior to such Board action.  The foregoing notwithstanding, upon
termination of the Plan the Board may elect to terminate all outstanding
Purchase Rights at such time as the Board may designate; in the event of such
termination of any Purchase Right prior to its exercise,

                                      -8-
<PAGE>   9
all amounts contributed to the Plan which remain in a Participant's Cash Account
will be returned to the Participant (without interest) as promptly as
practicable.

            (f)   No Rights to Participate; No Shareholder Rights.  No
Participant or employee will have any claim to participate in the Plan with
respect to Offering Periods that have not commenced, and the Company will
have no obligation to continue the Plan.   No Purchase Right will confer on
any Participant any of the rights of a shareholder of the Company unless and
until Stock is duly issued or transferred and delivered to the Participant
(or credited to the Participant's Stock Account).

            (g)   Fractional Shares.  Unless otherwise determined by the
Board, purchases of Stock under the Plan executed by the Custodian may result
in the crediting of fractional shares of Stock to the Participant's Stock
Account.  Such fractional shares will be computed to at least three decimal
places.  Fractional shares will not, however, be issued by the Company, and
certificates representing fractional shares will not be delivered to
Participants under any circumstances.

            (h)   Plan Year.  The Plan will operate on a plan year that
begins on January 1 and ends December 31 in each year.

            (i)   Governing Law.  The validity, construction, and effect of
the Plan and any rules and regulations relating to the Plan will be
determined in accordance with the laws of the State of Arizona, without
giving effect to principles of conflicts of laws, and applicable federal law.

            (j)   Effective Date.  The Plan will become effective on the
First Commencement Date, subject to the Plan being approved by shareholders
of the Company, at a meeting thereof, by a vote sufficient to meet the
requirements of Section 423(b)(2) of the Code.  If the Plan is not approved
in accordance with Section 423(b)(2) of the Code, each Participant's Purchase
Right shall be void and amounts credited to the Participant's Cash Account
shall be promptly returned to the Participant.  In the event the First
Commencement Date does not commence by December 31, 2000, the Plan shall be
terminated notwithstanding any approval thereof by shareholders of the
Company.

                                      -9-

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