Document:

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                                                                    Exhibit 10.1

                              EMPLOYMENT AGREEMENT

       This employment agreement (the "Agreement") is effective as of September
1, 2001, between LearningStar Corp. ("Employer") and Richard Delaney
("Employee").

                                    RECITALS

       Employer desires the services of Employee in order to retain Employee's
experience, abilities, and knowledge, and is therefore willing to engage
Employee's services on the terms and conditions set forth. Employee desires to
be employed by Employer and is willing to do so on the terms and conditions set
forth below.

       THEREFORE, in consideration of the above recitals and of the mutual
promises and conditions set forth in this Agreement, it is agreed as follows:

1.     DURATION: Subject to earlier termination as provided in this Agreement,
       Employee shall be employed for a term beginning September 1, 2001, and
       continuing through August 31, 2004.

2.     PLACE OF EMPLOYMENT: Unless the parties agree otherwise in writing,
       during the employment term Employee shall perform the services Employee
       is required to perform under this Agreement at Employer's headquarters
       (which are currently located at 2 Lower Ragsdale Dr., Suite 200,
       Monterey, CA, 93940) on an average of two to three days per week and at
       an office in Los Angeles for the balance of the week; provided, however,
       that Employer may from time to time require Employee to travel
       temporarily to other locations on Employer's business.

3.     DUTIES AND AUTHORITY: Employer shall employ Employee as its Chief
       Financial Officer or in such other capacity or capacities as Employer may
       from time to time prescribe. Employee shall have the full power and
       authority to manage and conduct business for the Employer, subject to the
       directions and policies of Employer as they may be, from time to time,
       stated either orally or in writing.

4.     REASONABLE TIME AND EFFORT: During Employee's employment, Employee shall
       devote such time, interest, and effort to the performance of this
       Agreement as may be fairly and reasonably necessary.

5.     SALARY: During the term of this Agreement, Employer agrees to pay
       Employee a base salary of $240,000 per year. The base salary shall be
       payable as a current salary on a bi-weekly basis. Employer, in its sole
       discretion, may increase Employee's base salary or any other benefits but
       may not decrease Employee's salary during the term of this Agreement.

       If during the term of this Agreement Employee's position is eliminated
       for any reason and/or Employee's employment with Employer is otherwise
       involuntarily terminated

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       for any reason apart from the reasons set forth in the sections below
       titled "Termination," "Termination Because of Death," and/or "Termination
       Because of Disability," Employer shall continue to pay Employee's base
       salary in effect at the time of Employee's termination of employment
       through August 31, 2004, or for one year, whichever is greater.

       Whenever compensation is payable to Employee during a time when Employee
       is partially or totally disabled and such disability would entitle
       Employee to disability income or to salary continuation payments from
       Employer according to the terms of any plan now or hereafter provided by
       Employer or according to any policy of Employer in effect at the time of
       such disability, Employee shall apply for such disability income or
       salary continuation, and the compensation payable to Employee under this
       Agreement shall be inclusive of any such disability income or salary
       continuation and shall not be in addition to such disability income or
       salary continuation. If disability income is payable to Employee by an
       insurance company under an insurance policy paid for by Employer, the
       compensation payable to Employee under this Agreement shall be inclusive
       of the amounts paid to Employee by that insurance company and shall not
       be in addition to the amounts paid to Employee by that insurance company.

6.     ADDITIONAL BENEFITS: During the employment term, Employee shall be
       entitled to receive all other benefits of employment generally available
       to Employer's other senior managerial employees when and as Employee
       becomes eligible for them, including medical, dental, life and disability
       insurance benefits, and participation in any pension plan, quarterly
       bonus plan, incentive plan and/or profit-sharing plan.

       Employer reserves the right to modify, suspend or discontinue any and all
       of the above benefit plans, policies and practices at any time without
       notice to or recourse to Employee so long as such action is taken
       generally with respect to other similarly situated persons and does not
       single out Employee.

7.     STOCK OPTIONS: Employee shall be entitled to options to purchase up to
       80,000 shares of LearningStar common stock pursuant to, and governed by,
       the LearningStar Corp. 2001 Stock Option and Incentive Plan. Such options
       are in addition to the options to purchase up to 40,000 shares of
       LearningStar common stock previously granted to Employee under the
       LearningStar Corp. 2001 Non-Employee Director Stock Option Plan.

8.     PAID TIME OFF: Employee shall be entitled to 38 business days of Paid
       Time Off ("PTO") annually. Employee's PTO will continue to accrue so long
       as Employee's total accrued PTO does not exceed 57 business days. In the
       event Employee's accrued PTO should reach 57 business days, Employee will
       cease to accrue further PTO until Employee's accrued PTO falls below that
       level. Other than the accrual and maximum accrual of PTO as set forth in
       this section of the Agreement, Employee's PTO shall be governed by the
       PTO provisions of the Earlychildhood.com Employee Manual.

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9.     HOUSING AND TRANSPORTATION: Employer will reimburse Employee for mutually
       agreeable, reasonable furnished housing and transportation for Employee
       while Employee is in Monterey pursuant to this Agreement.

10.    OFFICE FACILITIES AND ADMINISTRATIVE SUPPORT IN LOS ANGELES: Employer
       will provide Employee with commercially reasonable office space and
       administrative support in Los Angeles while working for Employer pursuant
       to this Agreement.

11.    EXPENSE REIMBURSEMENT: During the employment term, to the extent that
       such expenditures satisfy the criteria under the Internal Revenue Code
       for deductibility by Employer (whether or not fully deductible) for
       federal income tax purposes as ordinary and necessary business expenses,
       Employer shall reimburse Employee promptly for reasonable business
       expenses, including travel, entertainment, parking, business meetings,
       and professional dues, made and substantiated in accordance with the
       policies and procedures established from time to time by Employer with
       respect to Employer's other managerial employees.

12.    TERMINATION: Employer may terminate Employee's employment at any time for
       cause. Under this Agreement, the term "cause" shall mean (i)
       misappropriation of any material funds or property of Employer or of any
       of its related companies; (ii) unjustifiable neglect of duties under this
       Agreement; (iii) conviction of a felony involving moral turpitude; (iv)
       gross misconduct and/or the failure to act in good faith to the material
       detriment of Employer, or (v) willful and bad faith failure to obey
       reasonable and material orders given by Employer. If Employee is
       terminated as set forth in this paragraph, then payment of the specified
       salary earned and benefits accrued as of the date of the termination
       shall be payment in full of all compensation payable under this
       Agreement.

       In the event of a total and complete closure of Employer's business
       operations, for any reason whatsoever, Employee shall be entitled to
       continue to receive Employee's regular agreed-upon compensation for up to
       and including a maximum period of 12 weeks. If the business operations
       remain totally and completely closed for a period exceeding 12 weeks,
       Employer has the option of terminating the Agreement for the then
       remaining portion of the Term.

       If Employee is terminated or resigns as set forth in this section
       entitled "Termination," Employer shall be released and discharged of and
       from all further obligations under this Agreement, except for any monies
       due and owing to Employee and then unpaid which shall have vested prior
       to such termination.

13.    TERMINATION ON RESIGNATION: Employee may resign Employee's employment
       under this Agreement by giving Employer at least thirty (30) calendar
       days written notice of resignation. If Employee resigns as set forth in
       this section, Employer shall be released and discharged of and from all
       further obligations under this Agreement, except for any monies due and
       owing to Employee and then unpaid which shall have vested prior to such
       resignation.

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14.    TERMINATION BECAUSE OF DEATH: In the event that Employee should die
       during the term of this Agreement, this Agreement shall be terminated on
       the last day of the calendar month of Employee's death and Employer shall
       be required to pay to Employee's estate the specified salary and any
       additional benefits accrued by Employee at the time of Employee's death.

15.    TERMINATION BECAUSE OF DISABILITY: If, at the end of any calendar month
       during the initial term or any renewal term of this Agreement, Employee
       is and has been for the four (4) consecutive full calendar months then
       ending, or for 80% or more of the normal working days during the six (6)
       consecutive full calendar months then ending, unable due to mental or
       physical illness or injury to perform Employee's duties under this
       Agreement, Employer shall have the right, subject to applicable federal
       and state law, to terminate Employee's employment, and Employer shall
       only be obligated to pay Employee the specified compensation earned and
       benefits accrued by Employee at the time of her termination by Employer.

16.    AGREEMENT SURVIVES COMBINATION OR DISSOLUTION: This Agreement shall not
       be terminated by Employer's voluntary or involuntary dissolution or by
       any merger in which Employer is not the surviving or resulting
       corporation, or on any transfer of all or substantially all of Employer's
       assets. In the event of any such merger or transfer of assets, the
       provisions of this Agreement shall be binding on and inure to the benefit
       of the surviving business entity or the business entity to which such
       assets shall be transferred.

17.    NOTICES: All notices that either party is required or may desire to serve
       upon the other may be served either personally or by depositing the same
       in the US mail addressed to the other party to be served as follows:

       To Employer: Ron Elliott, c/o LearningStar Corp., 2 Lower Ragsdale Dr.,
       #200, Monterey, CA 93940.

       To Employee: Richard Delaney, 726 Via De La Paz, Pacific Palisades, CA
       90272.

18.    EMPLOYEE MANUAL: Employee acknowledges that Employee has been provided a
       copy of the Employee Manual, attached hereto as Exhibit A. It is agreed
       and understood that the Employee Manual represents guidelines that
       Employer may change from time to time in its sole discretion. It is not
       intended to be a contract. To the extent that this Agreement conflicts
       with the Employee Manual, the terms of this Agreement pertain to
       Employee's employment.

19.    NONDISCLOSURE OF CONFIDENTIAL INFORMATION OR TRADE SECRETS: In the course
       of Employee's employment with Employer, Employee will have access to
       confidential records and data pertaining to Employer's customers and its
       operations. Such information is considered secret and is disclosed to
       Employee in confidence. Furthermore, all memoranda, notes, records,
       computer files, and other documents or tangible material made or compiled
       by Employee, or made available to Employee

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       during the term of this Agreement concerning the business of Employer,
       shall be the sole property of Employer and shall be delivered to Employer
       on the expiration or termination of this Agreement, or at another time on
       request. During Employee's employment with Employer and thereafter,
       Employee shall keep in confidence and shall not directly or indirectly
       disclose any secret or confidential information belonging to Employer or
       any of its related companies except as required in the course of
       Employee's employment by Employer and/or authorized in writing by
       Employer, or required by law.

20.    GOVERNING LAW: This Agreement shall be governed by, and construed in
       accordance with, the laws of the State of California.

21.    ARBITRATION AND EQUITABLE RELIEF: (1) Arbitration: Employee agrees that
       in consideration of Employee's employment with Employer, its promise to
       arbitrate all employment-related disputes and Employee's receipt of the
       compensation, pay raises and other benefits paid to Employee by Employer,
       at present and in the future, Employee agrees that any and all
       controversies, claims, or disputes with anyone (including Employer and
       any employee, officer, director, shareholder or benefit plan of Employer
       in their capacity as such or otherwise) arising out of, relating to, or
       resulting from Employee's employment with Employer or the termination of
       Employee's employment with Employer, including any breach of this
       Agreement, shall be subject to binding arbitration under the arbitration
       rules set forth in California Code of Civil Procedure section 1280
       through 1294.2, including section 1283.05 (the "rules") and pursuant to
       California law. Disputes which Employee agrees to arbitrate, and thereby
       agrees to waive any right to a trial by jury, include any statutory
       claims under state or federal law, including, but not limited to, claims
       under Title VII of the Civil Rights Act of 1964, the Americans with
       Disabilities Act of 1994, the Age Discrimination in Employment Act of
       1967, the Older Workers Benefit Protection Act, the California Fair
       Employment and Housing Act, the California Labor Code, claims of
       harassment, discrimination or wrongful termination and any statutory
       claims. Employee further understands that this agreement to arbitrate
       also applies to any disputes that Employer may have with Employee. (2)
       Procedure: Employee agrees that any arbitration will be administered by
       the American Arbitration Association ("AAA") and that the arbitrator will
       be selected in a manner consistent with its national rules for the
       resolution of employment disputes. Employee agrees that the arbitrator
       shall have the power to decide any motions brought by any party to the
       arbitration, including motions for summary judgment and/or adjudication
       and motions to dismiss and demurrers, prior to any arbitration hearing.
       Employee also agrees that the arbitrator shall have the power to award
       any remedies, including attorneys' fees and costs, available under
       applicable law. Employee understands Employer will pay for any
       administrative or hearing fees charged by the arbitrator or AAA except
       that Employee shall pay the first $200.00 of any filing fees associated
       with any arbitration Employee initiates. Employee agrees that the
       arbitrator shall administer and conduct any arbitration in a manner
       consistent with the rules and that to the extent that the AAA's national
       rules for the resolution of employment disputes conflict with the rules,
       the rules shall take precedence. (3) Remedy: Except as provided by the
       rules,

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       arbitration shall be the sole, exclusive and final remedy for any dispute
       between Employee and Employer. Accordingly, except as provided for by the
       rules, neither Employee nor Employer will be permitted to pursue court
       action regarding claims that are subject to arbitration. Notwithstanding,
       the arbitrator will not have the authority to disregard or refuse to
       enforce any lawful Employer policy, and the arbitrator shall not order or
       require Employer to adopt a policy not otherwise required by law which
       Employer has not adopted. (4) Availability of Injunctive Relief: In
       addition to the right under the rules to petition the court for
       provisional relief, Employee agrees that any party may also petition the
       court for injunctive relief where either party alleges or claims a
       violation of any agreement or obligation regarding trade secrets,
       confidential information, nonsolicitation, Labor Code Section 2870, or
       invention assignment. In the event either party seeks injunctive relief,
       the prevailing party shall be entitled to recover reasonable costs and
       attorneys' fees. (5) Administrative Relief: Employee understands that
       this agreement does not prohibit Employee from pursuing an administrative
       claim with a local, state or federal administrative body such as the
       Department of Fair Employment and Housing, the Equal Employment
       Opportunity Commission or the Workers' Compensation Appeals Board. This
       agreement does, however, preclude Employee from pursuing court action
       regarding any such claim. (6) Voluntary Nature of Agreement: Employee
       acknowledges and agrees that Employee is executing this arbitration
       provision voluntarily and without any duress or undue influence by
       Employer or anyone else, and that Employee fully understands the terms,
       consequences and binding effect of this arbitration provision, including
       that Employee is waiving Employee's right to a jury trial.

22.    WAIVER: The failure by either party to exercise or enforce any terms or
       conditions under this Agreement shall not be deemed to be a waiver of
       that party's right to exercise or enforce any such term or condition in
       the future. The waiver by either party of any breach, default, or
       omission in the performance of any of the terms or conditions of this
       Agreement by the other party shall not be deemed to be a waiver of any
       other breach, default, or omission.

23.    SEVERABILITY: If any part of this Agreement is invalidated or rendered
       unenforceable by any court of competent jurisdiction or by any regulation
       or legislation to which it is subject, the remaining provisions and that
       provision found invalid or unenforceable as it may apply to other
       circumstances, shall remain in full force and effect. In such event, the
       parties shall promptly negotiate in good faith to amend this Agreement by
       replacing such stricken provision with a valid and enforceable provision
       that fulfills the original intention of the invalid or unenforceable
       provision.

24.    ENTIRE AGREEMENT: This Agreement constitutes the entire agreement of the
       parties with respect to the subject matter hereof and cancels and
       supersedes all previous agreements or understandings relating thereto,
       whether written or oral, between the parties.

25.    AMENDMENT: This Agreement shall only be amended or waived by a writing
       that explicitly refers to this Agreement and that is signed by both
       parties.

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26.    EXECUTION: The parties, having carefully read this Agreement and having
       consulted or having been given an opportunity to consult legal counsel,
       hereby acknowledge their agreement to all of the foregoing terms and
       conditions by executing this Agreement. Each signatory hereto represents
       and warrants that it is authorized to sign this Agreement on behalf of
       the respective party. This Agreement may be executed in any number of
       counterparts, and each such counterpart shall be an original and together
       they shall constitute one Agreement.

EMPLOYER                                EMPLOYEE
By:                                     By:

 /s/ Ronald Elliott                      /s/ Richard Delaney
--------------------------              -------------------------
Ronald Elliott                          Richard Delaney
CEO -- LearningStar Corp.

Date: September 1, 2001                 Date: September 1, 2001

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                                                                    Exhibit 10.2

                              AMENDED AND RESTATED

                               LEARNINGSTAR CORP.

                        2001 EMPLOYEE STOCK PURCHASE PLAN

ARTICLE 1 - PURPOSE.

       This 2001 Employee Stock Purchase Plan (the "Plan") is intended to
encourage stock ownership by all eligible employees of LearningStar Corp., a
Delaware corporation, (the "Company"), and its participating subsidiaries (as
defined in Article 17) so that they may share in the growth of the Company by
acquiring or increasing their proprietary interest in the Company. The Plan is
designed to encourage eligible employees to remain in the employ of the Company
and its participating subsidiaries. The Plan is intended to constitute an
"employee stock purchase plan" within the meaning of Section 423(b) of the
Internal Revenue Code of 1986, as amended (the "Code").

ARTICLE 2 - ADMINISTRATION OF THE PLAN.

       The Plan may be administered by a committee appointed by the Board of
Directors of the Company (the "Committee"). The Committee shall consist of not
less than two members of the Company's Board of Directors. The Board of
Directors may from time to time remove members from, or add members to, the
Committee. Vacancies on the Committee, howsoever caused, shall be filled by the
Board of Directors. The Committee may select one of its members as Chairman, and
shall hold meetings at such times and places as it may determine. Acts by a
majority of the Committee, or acts reduced to or approved in writing by a
majority of the members of the Committee, shall be the valid acts of the
Committee.

       The interpretation and construction by the Committee of any provisions of
the Plan or of any option granted under it shall be final, unless otherwise
determined by the Board of Directors. The Committee may from time to time adopt
such rules and regulations for carrying out the Plan as it may deem best,
provided that any such rules and regulations shall be applied on a uniform basis
to all employees under the Plan. No member of the Board of Directors or the
Committee shall be liable for any action or determination made in good faith
with respect to the Plan or any option granted under it.

       In the event the Board of Directors fails to appoint or refrains from
appointing a Committee, the Board of Directors shall have all power and
authority to administer the Plan. In such event, the word "Committee" wherever
used herein shall be deemed to mean the Board of Directors.

ARTICLE 3 - ELIGIBLE EMPLOYEES.

       All employees of the Company or any of its participating subsidiaries
whose customary employment with the Company is more than 20 hours per week and
for more than five months in any calendar year and who have completed at least
one (1) day of employment, shall be eligible to receive options under the Plan
to purchase common stock of the Company, and all eligible employees shall have
the same rights and privileges hereunder. Persons who are eligible employees on
the first business day of any Payment Period (as defined in Article 5) shall
receive their options as of such day. Persons who become eligible employees
after any date on which options are granted under the Plan shall be granted
options on the first day of the next succeeding Payment Period on which options
are granted to eligible employees under the

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Plan. In no event, however, may an employee be granted an option if such
employee, immediately after the option was granted, would be treated as owning
stock possessing five percent or more of the total combined voting power or
value of all classes of stock of the Company or of any parent corporation or
subsidiary corporation, as the terms "parent corporation" and "subsidiary
corporation" are defined in Section 424(e) and (f) of the Code. For purposes of
determining stock ownership under this paragraph, the rules of Section 424(d) of
the Code shall apply, and stock which the employee may purchase under
outstanding options shall be treated as stock owned by the employee.

ARTICLE 4 - STOCK SUBJECT TO THE PLAN.

       The stock subject to the options under the Plan shall be shares of the
Company's authorized but unissued common stock, par value $.01 per share (the
"Common Stock"), or shares of Common Stock reacquired by the Company, including
shares purchased in the open market. The aggregate number of shares which may be
issued pursuant to the Plan is 250,000, subject to adjustment as provided in
Article 12. If any option granted under the Plan shall expire or terminate for
any reason without having been exercised in full or shall cease for any reason
to be exercisable in whole or in part, the unpurchased shares subject thereto
shall again be available under the Plan.

ARTICLE 5 - PAYMENT PERIOD AND STOCK OPTIONS.

       Payment Periods shall consist of the six-month periods commencing on
March 1 and September 1 and ending on August 31 and February 28 of each calendar
year.

       On the first business day of each Payment Period, the Company will grant
to each eligible employee who is then a participant in the Plan an option to
purchase on the last day of such Payment Period, at the Option Price hereinafter
provided for, a maximum of 200 shares, on condition that such employee remains
eligible to participate in the Plan throughout the remainder of such Payment
Period. The participant shall be entitled to exercise the option so granted only
to the extent of the participant's accumulated payroll deductions on the last
day of such Payment Period. If the participant's accumulated payroll deductions
on the last day of the Payment Period would enable the participant to purchase
more than 200 shares except for the 200-share limitation, the excess of the
amount of the accumulated payroll deductions over the aggregate purchase price
of the 200 shares shall be promptly refunded to the participant by the Company,
without interest. The Option Price per share for each Payment Period shall be
the lesser of (i) 85% of the average market price of the Common Stock on the
first business day of the Payment Period and (ii) 85% of the average market
price of the Common Stock on the last business day of the Payment Period, in
either event rounded up to the nearest cent. The foregoing limitation on the
number of shares subject to option and the Option Price shall be subject to
adjustment as provided in Article 12.

       For purposes of the Plan, the term "average market price" on any date
means (i) the average (on that date) of the high and low prices of the Common
Stock on the principal national securities exchange on which the Common Stock is
traded, if the Common Stock is then traded on a national securities exchange; or
(ii) the last reported sale price (on that date) of the Common Stock on the
Nasdaq Stock Market, if the Common Stock is not then traded on a national
securities exchange; or (iii) the average of the closing bid and asked prices
last quoted (on that date) by an established quotation service for
over-the-counter securities, if the Common Stock is not reported on the Nasdaq
Stock Market; or (iv) if the Common Stock is not publicly traded, the fair
market value of the Common Stock as determined by the Committee after taking
into consideration all factors which it deems appropriate, including, without
limitation, recent sale and offer prices of the Common Stock in private
transactions negotiated at arm's length.

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       For purposes of the Plan, the term "business day" means a day on which
there is trading on the Nasdaq Stock Market or the aforementioned national
securities exchange, whichever is applicable pursuant to the preceding
paragraph; and if neither is applicable, a day that is not a Saturday, Sunday or
legal holiday in the State of Delaware.

       No employee shall be granted an option which permits the employee's right
to purchase stock under the Plan, and under all other Section 423(b) employee
stock purchase plans of the Company and any parent or subsidiary corporations,
to accrue at a rate which exceeds $25,000 of fair market value of such stock
(determined on the date or dates that options on such stock were granted) for
each calendar year in which such option is outstanding at any time. The purpose
of the limitation in the preceding sentence is to comply with Section 423(b)(8)
of the Code. If the participant's accumulated payroll deductions on the last day
of the Payment Period would otherwise enable the participant to purchase Common
Stock in excess of the Section 423(b)(8) limitation described in this paragraph,
the excess of the amount of the accumulated payroll deductions over the
aggregate purchase price of the shares actually purchased shall be promptly
refunded to the participant by the Company, without interest.

ARTICLE 6 - EXERCISE OF OPTION.

       Each eligible employee who continues to be a participant in the Plan on
the last day of a Payment Period shall be deemed to have exercised his or her
option on such date and shall be deemed to have purchased from the Company such
number of full shares of Common Stock reserved for the purpose of the Plan as
the participant's accumulated payroll deductions on such date will pay for at
the Option Price, subject to the 200-share limit of the option and the Section
423(b)(8) limitation described in Article 5. If the individual is not a
participant on the last day of a Payment Period, then he or she shall not be
entitled to exercise his or her option. Only full shares of Common Stock may be
purchased under the Plan. Unused payroll deductions remaining in a participant's
account at the end of a Payment Period by reason of the inability to purchase a
fractional share shall be carried forward to the next Payment Period.

ARTICLE 7 - AUTHORIZATION FOR ENTERING THE PLAN.

       An employee may elect to enter the Plan by filling out, signing and
delivering to the Company an authorization:

              A. Stating the percentage to be deducted regularly from the
       employee's pay;

              B. Authorizing the purchase of stock for the employee in each
       Payment Period in accordance with the terms of the Plan; and

              C. Specifying the exact name or names in which stock purchased for
       the employee is to be issued as provided under Article 11 hereof.

Such authorization must be received by the Company at least ten days before the
first day of the next succeeding Payment Period and shall take effect only if
the employee is an eligible employee on the first business day of such Payment
Period.

       Unless a participant files a new authorization or withdraws from the
Plan, the deductions and purchases under the authorization the participant has
on file under the Plan will continue from one Payment Period to succeeding
Payment Periods as long as the Plan remains in effect.

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       The Company will accumulate and hold for each participant's account the
amounts deducted from his or her pay. No interest will be paid on these amounts.

ARTICLE 8 - MAXIMUM AMOUNT OF PAYROLL DEDUCTIONS.

       An employee may authorize payroll deductions in an amount (expressed as a
whole percentage) not less than one percent (1%) but not more than ten percent
(10%) of the employee's total compensation, including base pay or salary and any
overtime, bonuses or commissions.

ARTICLE 9 - CHANGE IN PAYROLL DEDUCTIONS.

       Deductions may not be increased or decreased during a Payment Period.
However, a participant may withdraw in full from the Plan.

ARTICLE 10 - WITHDRAWAL FROM THE PLAN.

       A participant may withdraw from the Plan (in whole but not in part) at
any time prior to the last day of a Payment Period by delivering a withdrawal
notice to the Company.

       To re-enter the Plan, an employee who has previously withdrawn must file
a new authorization at least ten days before the first day of the next Payment
Period in which he or she wishes to participate. The employee's re-entry into
the Plan becomes effective at the beginning of such Payment Period, provided
that he or she is an eligible employee on the first business day of the Payment
Period.

ARTICLE 11 - ISSUANCE OF STOCK.

       Certificates for stock issued to participants shall be delivered as soon
as practicable after each Payment Period by the Company's transfer agent.

       Stock purchased under the Plan shall be issued only in the name of the
participant, or if the participant's authorization so specifies, in the name of
the participant and another person of legal age as joint tenants with rights of
survivorship.

ARTICLE 12 - ADJUSTMENTS.

       Upon the happening of any of the following described events, a
participant's rights under options granted under the Plan shall be adjusted as
hereinafter provided:

              A. In the event that the shares of Common Stock shall be
       subdivided or combined into a greater or smaller number of shares or if,
       upon a reorganization, split-up, liquidation, recapitalization or the
       like of the Company, the shares of Common Stock shall be exchanged for
       other securities of the Company, each participant shall be entitled,
       subject to the conditions herein stated, to purchase such number of
       shares of Common Stock or amount of other securities of the Company as
       were exchangeable for the number of shares of Common Stock that such
       participant would have been entitled to purchase except for such action,
       and appropriate adjustments shall be made in the purchase price per share
       to reflect such subdivision, combination or exchange; and

              B. In the event the Company shall issue any of its shares as a
       stock dividend upon or with respect to the shares of stock of the class
       which shall at the time be subject to option hereunder, each participant
       upon exercising such an option shall be entitled to receive (for the
       purchase price paid upon such exercise) the shares as to which the
       participant is exercising his or her option and, in

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       addition thereto (at no additional cost), such number of shares of the
       class or classes in which such stock dividend or dividends were declared
       or paid, and such amount of cash in lieu of fractional shares, as is
       equal to the number of shares thereof and the amount of cash in lieu of
       fractional shares, respectively, which the participant would have
       received if the participant had been the holder of the shares as to which
       the participant is exercising his or her option at all times between the
       date of the granting of such option and the date of its exercise.

       Upon the happening of any of the foregoing events, the class and
aggregate number of shares set forth in Article 4 hereof which are subject to
options which have been or may be granted under the Plan and the limitations set
forth in the second paragraph of Article 5 shall also be appropriately adjusted
to reflect the events specified in paragraphs A and B above. Notwithstanding the
foregoing, any adjustments made pursuant to paragraphs A or B shall be made only
after the Committee, based on advice of counsel for the Company, determines
whether such adjustments would constitute a "modification" (as that term is
defined in Section 424 of the Code). If the Committee determines that such
adjustments would constitute a modification, it may refrain from making such
adjustments.

       If the Company is to be consolidated with or acquired by another entity
in a merger, a sale of all or substantially all of the Company's assets or
otherwise (an "Acquisition"), the Committee or the board of directors of any
entity assuming the obligations of the Company hereunder (the "Successor Board")
shall, with respect to options then outstanding under the Plan, either (i) make
appropriate provision for the continuation of such options by arranging for the
substitution on an equitable basis for the shares then subject to such options
either (a) the consideration payable with respect to the outstanding shares of
the Common Stock in connection with the Acquisition, (b) shares of stock of the
successor corporation, or a parent or subsidiary of such corporation, or (c)
such other securities as the Successor Board deems appropriate, the fair market
value of which shall not materially exceed the fair market value of the shares
of Common Stock subject to such options immediately preceding the Acquisition;
or (ii) terminate each participant's options in exchange for a cash payment
equal to the excess of (a) the fair market value on the date of the Acquisition,
of the number of shares of Common Stock that the participant's accumulated
payroll deductions as of the date of the Acquisition could purchase, at an
option price determined with reference only to the first business day of the
applicable Payment Period and subject to the 200-share limit, Code Section
423(b)(8) and fractional-share limitations on the amount of stock a participant
would be entitled to purchase, over (b) the result of multiplying such number of
shares by such option price.

       The Committee or Successor Board shall determine the adjustments to be
made under this Article 12, and its determination shall be conclusive.

ARTICLE 13 - NO TRANSFER OR ASSIGNMENT OF EMPLOYEE'S RIGHTS.

       An option granted under the Plan may not be transferred or assigned and
may be exercised only by the participant.

ARTICLE 14 - TERMINATION OF EMPLOYEE'S RIGHTS.

       Whenever a participant ceases to be an eligible employee because of
retirement, voluntary or involuntary termination, resignation, layoff,
discharge, death or for any other reason, his or her rights under the Plan shall
immediately terminate, and the Company shall promptly refund, without interest,
the entire balance of his or her payroll deduction account under the Plan.
Notwithstanding the foregoing, eligible employment shall be treated as
continuing intact while a participant is on military leave, sick leave or other
bona fide leave of absence, for up to 90 days, or for so long as the
participant's right to re-employment is guaranteed either by statute or by
contract, if longer than 90 days.

                                       5
<PAGE>

       If a participant's payroll deductions are interrupted by any legal
process, a withdrawal notice will be considered as having been received from the
participant on the day the interruption occurs.

ARTICLE 15 - TERMINATION AND AMENDMENTS TO PLAN.

       Unless terminated sooner as provided below, the Plan shall terminate on
April 30, 2011. The Plan may be terminated at any time by the Company's Board of
Directors but such termination shall not affect options then outstanding under
the Plan. It will terminate in any case when all or substantially all of the
unissued shares of stock reserved for the purposes of the Plan have been
purchased. If at any time shares of stock reserved for the purpose of the Plan
remain available for purchase but not in sufficient number to satisfy all then
unfilled purchase requirements, the available shares shall be apportioned among
participants in proportion to the amount of payroll deductions accumulated on
behalf of each participant that would otherwise be used to purchase stock, and
the Plan shall terminate. Upon such termination or any other termination of the
Plan, all payroll deductions not used to purchase stock will be refunded,
without interest.

       The Committee or the Company's Board of Directors may at any time wholly
or partially amend, alter or suspend the Plan. However, without approval of the
Company's shareholders given within twelve (12) months before or after the
action by the Board, no action of the Committee or the Company's Board of
Directors may, except as provided in paragraph 12, increase the limits imposed
in paragraph 4 on the maximum number of shares which may be issued under the
Plan or extend the term of the Plan under paragraph 15.

       The Company's Board of Directors shall obtain shareholder approval of any
Plan amendment to the extent necessary and desirable to comply with applicable
tax laws.

       No amendment, alteration, suspension or termination of the Plan shall
impair the rights of any participant, unless mutually agreed otherwise between
the participant and the Company, which agreement must be in writing and signed
by the participant and the Company. Termination of the Plan shall not affect the
Committee's ability to exercise the powers granted to it hereunder with respect
to options granted or awarded under the Plan prior to the date of such
termination.

ARTICLE 16 - LIMITS ON SALE OF STOCK PURCHASED UNDER THE PLAN.

       The Plan is intended to provide shares of Common Stock for investment and
not for resale. The Company does not, however, intend to restrict or influence
any employee in the conduct of his or her own affairs. An employee may,
therefore, sell stock purchased under the Plan at any time the employee chooses,
subject to compliance with any applicable federal or state securities laws and
subject to any restrictions imposed under Article 21 to ensure that tax
withholding obligations are satisfied. THE EMPLOYEE ASSUMES THE RISK OF ANY
MARKET FLUCTUATIONS IN THE PRICE OF THE STOCK.

ARTICLE 17 - PARTICIPATING SUBSIDIARIES.

       The term "participating subsidiary" shall mean any present or future
subsidiary of the Company, as that term is defined in Section 424(f) of the
Code, which is designated from time to time by the Board of Directors to
participate in the Plan. The Board of Directors shall have the power to make
such designation before or after the Plan is approved by the stockholders.

                                       6
<PAGE>

ARTICLE 18 - OPTIONEES NOT STOCKHOLDERS.

       Neither the granting of an option to an employee nor the deductions from
his or her pay shall constitute such employee as a stockholder of the shares
covered by an option until such shares have been actually purchased by the
employee.

ARTICLE 19 - APPLICATION OF FUNDS.

       The proceeds received by the Company from the sale of Common Stock
pursuant to options granted under the Plan will be used for general corporate
purposes.

ARTICLE 20 - NOTICE TO COMPANY OF DISQUALIFYING DISPOSITION.

       By electing to participate in the Plan, each participant agrees to notify
the Company in writing immediately after the participant transfers Common Stock
acquired under the Plan, if such transfer occurs within two years after the
first business day of the Payment Period in which such Common Stock was
acquired. Each participant further agrees to provide any information about such
a transfer as may be requested by the Company or any subsidiary corporation in
order to assist it in complying with the tax laws. Such dispositions generally
are treated as "disqualifying dispositions" under Sections 421 and 424 of the
Code, which have certain tax consequences to participants and to the Company and
its participating subsidiaries.

ARTICLE 21 - WITHHOLDING OF ADDITIONAL INCOME TAXES.

       By electing to participate in the Plan, each participant acknowledges
that the Company and its participating subsidiaries are required to withhold
taxes with respect to the amounts deducted from the participant's compensation
and accumulated for the benefit of the participant under the Plan, and each
participant agrees that the Company and its participating subsidiaries may
deduct additional amounts from the participant's compensation, when amounts are
added to the participant's account, used to purchase Common Stock or refunded,
in order to satisfy such withholding obligations. Each participant further
acknowledges that when Common Stock is purchased under the Plan the Company and
its participating subsidiaries may be required to withhold taxes with respect to
all or a portion of the difference between the fair market value of the Common
Stock purchased and its purchase price, and each participant agrees that such
taxes may be withheld from compensation otherwise payable to such participant.
It is intended that tax withholding will be accomplished in such a manner that
the full amount of payroll deductions elected by the participant under Article 7
will be used to purchase Common Stock. However, if amounts sufficient to satisfy
applicable tax withholding obligations have not been withheld from compensation
otherwise payable to any participant, then, notwithstanding any other provision
of the Plan, the Company may withhold such taxes from the participant's
accumulated payroll deductions and apply the net amount to the purchase of
Common Stock, unless the participant pays to the Company, prior to the exercise
date, an amount sufficient to satisfy such withholding obligations. Each
participant further acknowledges that the Company and its participating
subsidiaries may be required to withhold taxes in connection with the
disposition of stock acquired under the Plan and agrees that the Company or any
participating subsidiary may take whatever action it considers appropriate to
satisfy such withholding requirements, including deducting from compensation
otherwise payable to such participant an amount sufficient to satisfy such
withholding requirements or conditioning any disposition of Common Stock by the
participant upon the payment to the Company or such subsidiary of an amount
sufficient to satisfy such withholding requirements. Notwithstanding any other
provision of the Plan, the number of shares of Common Stock which may be
withheld upon the exercise or vesting of any right under the Plan, or which may
be repurchased from the Participant within six months after such shares were
acquired by the participant from the Company, in order to satisfy the
participant's federal and state income and payroll

                                       7
<PAGE>

tax liabilities with respect to the exercise or vesting of the right shall be
limited to the number of shares which have a fair market value equal to the
aggregate amount of such liabilities based on the minimum statutory withholding
rates for federal and state income tax income and payroll tax purposes that are
applicable to such supplemental taxable income.

ARTICLE 22 - GOVERNMENTAL REGULATIONS.

       The Company's obligation to sell and deliver shares of Common Stock under
the Plan is subject to the approval of any governmental authority required in
connection with the authorization, issuance or sale of such shares.

       Government regulations may impose reporting or other obligations on the
Company with respect to the Plan. For example, the Company may be required to
identify shares of Common Stock issued under the Plan on its stock ownership
records and send tax information statements to employees and former employees
who transfer title to such shares.

ARTICLE 23 - GOVERNING LAW.

       The validity and construction of the Plan shall be governed by the laws
of Delaware, without giving effect to the principles of conflicts of law
thereof.

                                       8

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