Document:

<PAGE>   1
                                                                   EXHIBIT 10.34

                             AREMISSOFT CORPORATION
                             2000 STOCK OPTION PLAN

      1. Purpose; Definitions.

            (a) Purpose. The purpose of the Plan is to attract, retain and
motivate employees, officers, directors, and consultants of the Company, or a
subsidiary of the Company, by giving them the opportunity to acquire Stock
ownership in the Company.

            (b) Definitions. For purposes of the Plan, the following terms have
the following meanings:

                  (i) "Administrator" means the Compensation Committee referred
to in Section 4 in its capacity as administrator of the Plan, or the Board in
the event that it abolishes the Compensation Committee and reinvests in the
Board the administration of the Plan.

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

                  (iii) "Code" shall mean the Internal Revenue Code of 1986, as
amended from time to time.

                  (iv) "Commission" means the Securities and Exchange Commission
and any successor agency.

                  (v) "Company" means AremisSoft Corporation, a Delaware
corporation and its subsidiaries.

                  (vi) "Director" shall mean a member of the Board.

                  (vii) "Effective Date" has the meaning set forth in Section 2.

                  (viii)"Eligible Person" means, in the case of the grant of an
Incentive Stock Option Plan, all employees of the Company or a subsidiary of the
Company and, in the case of a Non-qualified Stock Option, any director, officer
or employee of the Company or other person who, in the opinion of the Board, is
rendering valuable services to the Company, including without limitation, an
independent contractor, outside consultant, or advisor to the Company.

                  (ix) "Exchange Act" means the Securities Exchange Act of 1934,
as amended from time to time, and any successor statute.

                  (x) "Fair Market Value" means (i) if the Stock is listed or
admitted to trade on a national securities exchange, the closing price of the
Stock on the Composite Tape, as published in the Western Edition of the Wall
Street Journal, of the principal national securities exchange on which the Stock
is so listed or admitted to trade, on such date, or, if there is no trading of
the Stock on such date, then the closing price of the Stock as quoted on such
Composite Tape on the next preceding date on which there was trading in such
Stock; (ii) if the Stock is not listed or admitted to trade on a national
securities exchange, the closing price for the Stock on such date, as furnished
by the National Association of Securities Dealers, Inc. ("NASD") through the
NASDAQ National Market System or a similar organization if the NASD is no longer
reporting such information; (iii) if the Stock is not reported on the National
Market System, the mean between the closing bid and asked prices for the Stock
on such date, as

                                        1
<PAGE>   2
furnished by the NASD, and if no bid and asked prices are quoted on such date,
the bid and asked prices on the next preceding day on which such prices were
quoted; and (iv) if the Stock is not reported on the National Market System and
if bid and asked prices for the Stock are not furnished by the NASD or a similar
organization, the value established by the Administrator for purposes of
granting options under the Plan.

                  (xi) "Grant Date" means the date of grant of any Option.

                  (xii) "Incentive Stock Option" means an option which is an
option within the meaning of Section 422 of the Code, the award of which
contains such provisions as are necessary to comply with that section.

                  (xiii)"NASD Dealer" means a broker-dealer that is a member of
the National Association of Securities Dealers.

                  (xiv) "Non-Employee Director" has the meaning set forth in
Rule 16-3.

                  (xv) "Non-qualified Stock Option" means an option which is
designated a Non-qualified Stock Option.

                  (xvi) "Officer" means an officer of the Company who is subject
to Section 16 of the Exchange Act.

                  (xvii) "Option" means an option to purchase Common Stock under
this Plan. An Option shall be designated by the Committee as an Incentive Stock
Option or a Non-qualified Stock Option.

                  (xviii) "Option Agreement" means the written option agreement
covering an Option.

                  (xix) "Optionee" means the holder of an option.

                  (xx) "Plan" means this AremisSoft Corporation 2000 Stock
Option Plan as amended from time to time.

                  (xxi) "Rule 16b-3" means Rule 16b-3 under Section 16 (b) of
the Exchange Act, as amended from time to time, and any successor rule.

                  (xxii) "Stock" means the Common Stock, par value $0.001, of
the Company, and any successor entity.

                  (xxiii) "Subsidiary" means any corporation in an unbroken
chain of corporations beginning with the Company if, at the time of granting of
an Option, each of the corporations other than the last corporation in the
unbroken chain owns stock possessing fifty percent (50%) or more of the total
combined voting power of all classes of stock in one of the other corporations
in such chain.

                  (xxiv) "Tax Date" means the date defined in Section 7.

                  (xxv) "Vesting Date" means the date on which an Option becomes
wholly or partially exercisable, as determined by the Administrator in its sole
discretion.

      2. Effective Date; Term of Plan. The Effective Date of this Plan shall be
upon stockholder approval of this Plan within 12 months of the date of Board
approval. Any Options granted prior to stockholder approval of the Plan, shall,
upon stockholder approval, be deemed issued as of the grant date. This Plan, but
not Options already granted, shall terminate automatically ten years after its
adoption by the Board, unless terminated earlier by the Board

                                        2
<PAGE>   3
under Section 13. No Options shall be granted after termination of this Plan but
all Options granted prior to termination shall remain in effect in accordance
with their terms.

      3. Number and Source of Shares of Stock Subject to the Plan. Subject to
the provisions of Section 8, the total number of shares of Stock with respect to
which Options may be granted under this Plan is three million fifty thousand
(3,050,000) shares of Stock. The shares of Stock covered by any canceled,
expired or terminated Option or the unexercised portion thereof shall become
available again for grant under this Plan. The shares of Stock to be issued
hereunder upon exercise of an Option may consist of authorized and unissued
shares or treasury shares.

      4. Administration of the Plan. Authority to control and manage the
operation and administration of the Plan shall be vested in the Board, which may
delegate such responsibilities in whole or in part to a committee consisting of
two (2) or more members of the Board, all of whom shall be Non-Employee
Directors (the "Compensation Committee"). Members of the Compensation Committee
may be appointed from time to time by, and shall serve at the pleasure of, the
Board. As used herein, the term "Administrator" means the Board or, with respect
to any matter as to which responsibility has been delegated to the Compensation
Committee, the term Administrator shall mean the Compensation Committee.

      Subject to the express provisions of this Plan, the Administrator shall
have the authority to construe and interpret this Plan and any agreements
defining the rights and obligations of the Company and Optionees under this
Plan; to further define the terms used in this Plan; to correct any defect or
supply any omission or reconcile any inconsistency in the Plan or in any Option
Agreement; to provide for rights of refusal and/or repurchase rights; to amend
outstanding Option Agreements to provide for, among other things, any change or
modification which the Administrator could have provided for upon the grant of
an Option or in furtherance of the powers provided for herein; to prescribe,
amend and rescind rules and regulations relating to the administration of this
Plan; to determine the duration and purposes of leaves of absence which may be
granted to Optionees without constituting a termination of their employment for
purposes of this Plan; to accelerate the vesting of any Option; and to make all
other determinations necessary or advisable for the administration of this Plan.

      Any decision or action of the Administrator in connection with this Plan
or Options granted or shares of Stock purchased under this Plan shall be final
and binding. The Administrator shall not be liable for any decision, action or
omission respecting this Plan, or any Options granted or shares of Stock sold
under this Plan. The Board at any time may abolish the Compensation Committee
and reinvest in the Board the administration of the Plan.

      To the extent permitted by applicable law in effect from time to time, no
member of the Compensation Committee or the Board of Directors shall be liable
for any action or omission of any other member of the Compensation Committee or
the Board of Directors nor for any act or omission on the member's own part,
excepting only the member's own willful misconduct or gross negligence, arising
out of or related to the Plan. The Company shall pay expenses incurred by, and
satisfy a judgment or fine rendered or levied against, a present or former
director or member of the Compensation Committee or Board in any action against
such person (whether or not the Company is joined as a party defendant) to
impose liability or a penalty on such person for an act alleged to have been
committed by such person while a director or member of the Compensation
Committee or Board arising with respect to the Plan or administration thereof or
out of membership on the Compensation Committee or Board or by the Company, or
all or any combination of the preceding; provided, the director or Compensation
Committee member was acting in good faith, within what such director or
Compensation Committee member reasonably believed to have been within the scope
of his or her employment or authority and for a purpose which he or she
reasonably believed to be in the best interests of the Company or its
stockholders. Payments authorized hereunder include amounts paid and expenses
incurred in settling any such action or threatened action. The provisions of
this section shall apply to the estate, executor, administrator, heirs, legatees
or devisees of a director or Compensation Committee member, and the term
"person" as used on this section shall include the estate, executor,
administrator, heirs, legatees, or devisees of such person.

      5. Grant of Options; Terms and Conditions of Grant.

                                        3
<PAGE>   4
            (a) Grant of Options. One or more Options may be granted to any
Eligible Person. Subject to the express provisions of the Plan, the
Administrator shall determine from the Eligible Persons those individuals to
whom Options under the Plan may be granted. Each Option so granted shall be
designated by the Administrator as either a Non-qualified Stock Option or an
Incentive Stock Option.

      Subject to the express provisions of the Plan, the Administrator shall
specify the Grant Date, the number of shares of Stock covered by the Option, the
exercise price and the terms and conditions for exercise of the Options. If the
Administrator fails to specify the Grant Date, the Grant Date shall be the date
of the action taken by the Administrator to grant the Option. As soon as
practicable after the Grant Date, the Company will provide the Optionee with a
written Option Agreement in the form approved by the Administrator, which sets
out the Grant Date, the number of shares of Stock covered by the Option, the
exercise price and the terms and conditions for exercise of the Option.

      The Administrator may, in its absolute discretion, grant Options under
this Plan at any time and from time to time before the expiration of ten years
from the Effective Date to an Eligible Person.

            (b) General Terms and Conditions. Except as otherwise provided
herein, the Options shall be subject to the following terms and conditions and
such other terms and conditions not inconsistent with this Plan as the
Administrator may impose:

                  (i) Exercise of Option. In order to exercise all or any
portion of any Option granted under this Plan, an Optionee must remain as an
officer, employee, consultant or director of the Company, or a Subsidiary, until
the Vesting Date. The Option shall be exercisable on or after each Vesting Date
in accordance with the terms set forth in the Option Agreement.

                  (ii) Option Term. Each Option and all rights or obligations
thereunder shall expire on such date as shall be determined by the
Administrator, but not later than 10 years after the grant of the Option (5
years in the case of an Incentive Stock Option when the Optionee owns more than
10% of the total combined voting power of all classes of stock of the Company),
and shall be subject to earlier termination as hereinafter provided.

                  (iii) Exercise Price. The Exercise Price of any Option shall
be determined by the Administrator, but in the case of Incentive Stock Options
shall not be less than 100% (110% in the case of an Optionee who owns more than
10% of the total combined voting power of all classes of stock of the Company)
of the Fair Market Value of the Stock on the date the Incentive Stock Option is
granted.

                  (iv) Method of Exercise. To the extent the right to purchase
shares of Stock has vested, Options may be exercised, in whole or in part, from
time to time in accordance with their terms by written notice from the Optionee
to the Company stating the number of shares of Stock with respect to which the
Option is being exercised. Payment of the exercise price may be made, in the
discretion of the Administrator, subject to any legal restrictions, by: (a)
cash; (b) check; (c) the surrender of shares of Stock owned by the Optionee that
have been held by the Optionee for at least six (6) months, which surrendered
shares shall be valued at Fair Market Value as of the date of such exercise; (d)
the Optionee's promissory note in a form and on terms acceptable to the
Administrator; (e) the cancellation of indebtedness of the Company to the
Optionee; (f) provided that a public market for the Stock exists, a "same day
sale" commitment from the Optionee and an NASD Dealer whereby the Optionee
irrevocably elects to exercise the Option and to sell a portion of the shares so
purchased to pay for the Exercise Price and whereby the NASD Dealer irrevocably
commits upon receipt of such shares to forward the Exercise Price directly to
the Company; or (g) any combination of the foregoing methods of payment or any
other consideration or method of payment as shall be permitted by applicable
corporate law. The Administrator may provide, in an Agreement or otherwise, that
an Optionee who exercises an Option and pays the exercise price in whole or in
part with Stock then owned by the Optionee will be entitled to receive another
Option covering the same number of shares tendered and with a price of no less
than Fair Market Value on the date of grant of such additional Option ("Reload
Option").

                                        4
<PAGE>   5
Unless otherwise provided in the Agreement, an Optionee, in order to be entitled
to a Reload Option, must pay with Stock that has been owned by the Optionee for
at least the preceding 180 days.

                  (v) Restrictions on Stock; Option Agreement. At the time it
grants Options under this Plan, the Company may retain, for itself or others,
rights to repurchase the shares of Stock acquired under the Option or impose
other restrictions on such shares. The terms and conditions of any such rights
or other restrictions shall be set forth in the Option Agreement evidencing the
Option. No Option shall be exercisable until after execution of the Option
Agreement by the Company and the Optionee.

                  (vi) Transferability of Options. Except as otherwise provided
below for Non-qualified Stock Options, no Option shall be transferable other
than by will or by the laws of descent and distribution and during the lifetime
of an Optionee, only the Optionee, his guardian or legal representative may
exercise an Option. An Optionee may designate a beneficiary to exercise his or
her Options after the Optionee's death. The Administrator may provide for
transfer of an Option (other than an Incentive Stock Option), without payment of
consideration, to the following family members of the Optionee, including
adoptive relationships: a child, stepchild, grandchild, parent, stepparent,
grandparent, spouse, sibling, mother-in-law, father-in-law, son-in-law,
daughter-in-law, brother-in- law, sister-in-law, niece, nephew, former spouse
(whether by gift or pursuant to a domestic relations order), any person sharing
the employee's household (other than a tenant or employee), an Optionee or
family-controlled partnership, corporation, limited liability company and trust,
or a foundation in which the Optionee or family members heretofore described
control the management of assets. The assigned portion may only be exercised by
the person or persons who acquire a proprietary interest in the option pursuant
to the assignment. The terms applicable to the assigned portion shall be the
same as those in effect for the option immediately prior to such assignment and
shall be set forth in such documents issued to the assignee as the Administrator
may deem appropriate.

                  (vii) Exercise After Certain Events.

                        (1) Termination of Employment/Consulting/Directorship.
If for any reason other than permanent and total disability or death (as defined
below) an Optionee ceases to be employed by or to be a consultant or director of
the Company, or a Subsidiary, Incentive Stock Options held at the date of such
termination (to the extent then exercisable) may be exercised, in whole or in
part, at any time within three months after the date of such termination or such
lesser period specified in the Option Agreement (but in no event after the
earlier of (i) the expiration date of the Option as set forth in the Option
Agreement, and (ii) ten years from the Grant Date) and Non-qualified Stock
Options held at the date of such termination (to the extent then exercisable)
may be exercised, in whole or in part, at any time within the period specified
in the Option Agreement (but in no event after the earlier of (i) the expiration
date of the Option as set forth in the Option Agreement, and (ii) ten years from
the Grant Date), or such lesser period specified by the Administrator.

                           If an Optionee granted an Incentive Stock Option
terminates employment but continues as a consultant, advisor or in a similar
capacity to the Company or a Subsidiary, Optionee need not exercise the Option
within three months of termination of employment but shall be entitled to
exercise within three months of termination of services to the Company or the
Subsidiary (one year in the event of permanent disability or death). However, if
Optionee does not exercise within three months of termination of employment, the
Option will not qualify as an Incentive Stock Option.

                        (2) Permanent Disability and Death. If an Optionee
becomes permanently and totally disabled (within the meaning of Section 22(e)(3)
of the Code), or dies while employed by the Company, or while acting as an
officer, consultant or director of the Company, or a Subsidiary, (or, if the
Optionee dies within the period that the Option remains exercisable after
termination of employment or affiliation), Incentive Stock Options then held (to
the extent then exercisable) may be exercised by the Optionee, the Optionee's
personal representative, or by the person to whom the Incentive Stock Option is
transferred by will or the laws of descent and distribution, in whole or in
part, at any time within one year after the disability or death or any lesser
period specified

                                        5
<PAGE>   6
in the Option Agreement (but in no event after the earlier of (i) the expiration
date of the Option as set forth in the Option Agreement, and (ii) ten years from
the Grant Date). Non-qualified Stock Options shall not be limited to such one
year exercise period upon permanent disability or death and may be exercised at
any time specified in the Option Agreement (but in no event after the earlier of
(i) the expiration date of the Option as set forth in the Option Agreement, and
(ii) ten years from the Grant Date) or such lesser period specified by the
Administrator.

                  (viii) Compliance with Securities Laws. The Company shall not
be obligated to issue any shares of Stock upon exercise of an Option unless such
shares are at that time effectively registered or exempt from registration under
the federal securities laws and the offer and sale of the shares of Stock are
otherwise in compliance with all applicable securities laws. Upon exercising all
or any portion of an Option, an Optionee may be required to furnish
representations or undertakings deemed appropriate by the Company to enable the
offer and sale of the shares of Stock or subsequent transfers of any interest in
such shares to comply with applicable securities laws. Evidences of ownership of
shares of Stock acquired upon exercise of Options shall bear any legend required
by, or useful for purposes of compliance with, applicable securities laws, this
Plan or the Option Agreement evidencing the Option.

      6. Limitations on Grant of Incentive Stock Options.

            (a) The aggregate Fair Market Value (determined as of the Grant
Date) of the Stock for which Incentive Stock Options may first become
exercisable by any Optionee during any calendar year under this Plan, together
with that of Stock subject to Incentive Stock Options first exercisable (other
than as a result of acceleration pursuant to Section 9(a)) by such Optionee
under any other plan of the Company or any Subsidiary, shall not exceed
$100,000.

            (b) There shall be imposed in the Option Agreement relating to
Incentive Stock Options such terms and conditions as are required in order that
the Option be an "incentive stock option" as that term is defined in Section 422
of the Code.

            (c) No Incentive Stock Option may be granted to any person who, at
the time the Incentive Stock Option is granted, owns shares of outstanding Stock
possessing more than 10% of the total combined voting power of all classes of
stock of the Company, unless the exercise price of such Option is at least 110%
of the Fair Market Value of the Stock (determined as of the Grant Date) subject
to the Option and such Option by its terms is not exercisable after the
expiration of five years from the Grant Date.

            (d) No Incentive Stock Option may be granted to any person who is
not an employee of the Company or a Subsidiary of the Company.

      7. Payment of Taxes. Upon the disposition by an Optionee or other person
of shares of an Option prior to satisfaction of the holding period requirements
of Section 422 of the Code, or upon the exercise of a Non-qualified Stock
Option, the Company shall have the right to require such Optionee or such other
person to pay by cash, or check payable to the Company, the amount of any
required withholding on applicable federal, state, and local taxes and FICA or
any such other applicable tax regulations and laws with respect to such
transactions. Any such payment must be made promptly when the amount of such
obligation becomes determinable (the "Tax Date"). To the extent permissible
under applicable tax, securities and other laws, the Administrator may, in its
sole discretion and upon such terms and conditions as it may deem appropriate,
permit an Optionee to satisfy his or her obligation to pay any such tax, in
whole or in part, up to an amount not greater than the Optionee's estimated
withholding, by (a) directing the Company to apply shares of Stock to which the
Optionee is entitled as a result of the exercise of an Option, or (b) delivering
to the Company shares of Stock owned by the Optionee. The shares of Stock so
applied or delivered in satisfaction of the Optionee's tax withholding
obligation shall be valued at their Fair Market Value as of the date of
measurement of the amount of income subject to withholding.

                                        6
<PAGE>   7
      8. Adjustment for Changes in Capitalization. The existence of outstanding
Options shall not affect the Company's right to effect adjustments,
recapitalizations, reorganizations or other changes in its or any other
corporation's capital structure or business, any merger or consolidation, any
issuance of bonds, debentures, preferred or prior preference stock ahead of or
affecting the Stock, the dissolution or liquidation of the Company's or any
other corporation's assets or business or any other corporate act whether
similar to the events described above or otherwise. Subject to Section 9, if the
outstanding shares of the Stock are increased or decreased in number or changed
into or exchanged for a different number or kind of securities of the Company or
any other corporation by reason of a recapitalization, reclassification, stock
split, combination of shares, stock dividend or other event, an appropriate
adjustment of the number and kind of securities with respect to which Options
may be granted under this Plan, the number and kind of securities as to which
outstanding Options may be exercised, and the exercise price at which
outstanding Options may be exercised will be made.

      9. Dissolution, Liquidation, Merger.

            (a) Company Not The Survivor. In the event of a dissolution or
liquidation of the Company, a merger, consolidation, combination or
reorganization in which the Company is not the surviving corporation, or a sale
of substantially all of the assets of the Company (as determined in the sole
discretion of the Board of Directors), the Administrator, in its absolute
discretion, may cancel each outstanding Option upon payment in cash to the
Optionee of the amount by which any cash and the fair market value of any other
property which the Optionee would have received as consideration for the shares
of Stock covered by the Option if the Option had been exercised before such
liquidation, dissolution, merger, consolidation, combination, reorganization or
sale exceeds the exercise price of the Option or negotiate to have such option
assumed by the surviving corporation. In addition to the foregoing, in the event
of a dissolution or liquidation of the Company, or a merger, consolidation,
combination or reorganization, in which the Company is not the surviving
corporation, the Administrator, in its absolute discretion, may accelerate the
time within which each outstanding Option may be exercised or negotiate to have
such option assumed by the surviving corporation.

            (b) Company is the Survivor. In the event of a merger,
consolidation, combination or reorganization in which the Company is the
surviving corporation, the Board of Directors shall determine the appropriate
adjustment of the number and kind of securities with respect to which
outstanding Options may be exercised, and the exercise price at which
outstanding Options may be exercised. The Board of Directors shall determine, in
its sole and absolute discretion, when the Company shall be deemed to survive
for purposes of this Plan.

      10. Change of Control. If there is a "change of control" in the Company,
all outstanding Options shall fully vest immediately upon the Company's public
announcement of such a change. A "change of control" shall mean an event
involving one transaction or a related series of transactions, in which (i) the
Company issues securities equal to 25% or more of the Company's issued and
outstanding voting securities, determined as a single class, to any individual,
firm, partnership, limited liability company, or other entity, including a
"group" within the meaning of SEC Exchange Act Rule 13d-3, (ii) the Company
issues voting securities equal to 25% or more of the issued and outstanding
voting stock of the Company in connection with a merger, consolidation other
business combination, (iii) the Company is acquired in a merger or other
business combination transaction in which the Company is not the surviving
company, or (iv) all or substantially all of the Company's assets are sold or
transferred. See Section 9 with respect to Options vesting upon the occurrence
of either of the events described in (iii) or (iv) of this Section 10 and the
result upon the non-exercise of the Options.

      11. Suspension and Termination. In the event the Board or the
Administrator reasonably believes an Optionee has committed an act of misconduct
including, but limited to acts specified below, the Administrator may suspend
the Optionee's right to exercise any Option granted hereunder pending final
determination by the Board or the Administrator. If the Administrator determines
that an Optionee has committed an act of embezzlement, fraud, breach of
fiduciary duty or deliberate disregard of the Company rules or rules made by a
supervisor, or if an Optionee makes an unauthorized disclosure of any Company
trade secret or confidential information, engages in any conduct

                                        7
<PAGE>   8
constituting unfair competition, induces any Company customer to breach a
contract with the Company or induces any principal for whom the Company acts as
agent to terminate such agency relationship, neither the Optionee nor his estate
shall be entitled to exercise any Option hereunder. In making such
determination, the Board or the Administrator shall give the Optionee an
opportunity to appear and present evidence on the Optionee's behalf. The
determination of the Board or the Administrator shall be final and conclusive.

      12. No Rights as Stockholder or to Continued Employment. An Optionee shall
have no rights as a stockholder with respect to any shares of Stock covered by
an Option. An Optionee shall have no right to vote any shares of Stock, or to
receive distributions of dividends or any assets or proceeds from the sale of
Company assets upon liquidation until such Optionee has effectively exercised
the Option and fully paid for such shares of Stock. Subject to Sections 8 and 9,
no adjustment shall be made for dividends or other rights for which the record
date is prior to the date title to the shares of Stock has been acquired by the
Optionee. The grant of an Option shall in no way be construed so as to confer on
any Optionee the rights to continued employment by the Company.

      13. Termination; Amendment. The Board may amend, suspend or terminate this
Plan at any time and for any reason, but no amendment, suspension or termination
shall be made which would impair the right of any person under any outstanding
Options without such person's consent not unreasonably withheld. Further, the
Board may also amend this Plan to materially increase the benefits accruing to
Option holders under this Plan; provided, however, that any such amendment shall
be subject to the approval of the Company's stockholders if so required to
maintain the status of the Plan as an Incentive Stock Option Plan.

      14. Governing Law. This Plan and the rights of all persons under this Plan
shall be construed in accordance with and under applicable provisions of the
laws of the State of California.

                                        8<PAGE>   1

                                  Exhibit 10.35

                                     FORM OF
                             AREMISSOFT CORPORATION
                           2001 EQUITY INCENTIVE PLAN

                                   As adopted
                                February 19, 2001

1. PURPOSE. The purpose of this Plan is to provide incentives to attract, retain
and motivate Eligible Persons whose present and potential contributions are
important to the success of the Company, or a Subsidiary of the Company, by
offering them an opportunity to participate in the Company's future performance
through awards of Options, Restricted Stock, Stock Appreciation Rights, and
Stock Bonuses. This Plan is not intended to replace any current plan of, or
awards issued by, Company, nor shall it limit the ability of Company to create
additional or new plans, or to issue additional or new awards. Capitalized terms
not defined in the text are defined in Section 26.

2. ADOPTION AND STOCKHOLDER APPROVAL. This Plan is effective as of the date
approved by the Board ("Effective Date"). This Plan shall be submitted for
stockholders approval, consistent with applicable laws, within twelve (12)
months after the Effective Date. No Award shall be granted after termination of
this Plan but all Awards granted prior to termination shall remain in effect in
accordance with their terms. So long as the Company is subject to Section 16(b)
of the Exchange Act, the Company will comply with the requirements of Rule 16b-3
(or its successor), as amended.

3. TERM OF PLAN. Unless earlier terminated as provided herein, this Plan will
terminate ten (10) years from the Effective Date or, if earlier, the date of
stockholder approval.

4. SHARES SUBJECT TO THIS PLAN.

     4.1. Number of Shares Available. Subject to Section 4.2, the total number
of Shares reserved and available for grant and issuance pursuant to this Plan
will be four million (4,000,000) Shares. Subject to Section 4.2, Shares that are
subject (a) to issuance upon exercise of an Option but cease to be subject to
such Option for any reason other than exercise of such Option; (b) to an Award
granted hereunder, but is forfeited; or (c) to an Award that otherwise
terminates without Shares being issued, will again be available for grant and
issuance in connection with future Awards under this Plan. At all times, the
Company shall reserve and keep available a sufficient number of Shares as shall
be required to satisfy the requirements of all outstanding Awards granted under
this Plan. The shares of Stock to be issued hereunder upon exercise of an Award
shall consist of authorized and unissued Shares.

     4.2. Adjustment of Shares. In the event that the number of outstanding
Shares is changed by a stock dividend, recapitalization, stock split, reverse
stock split, subdivision, combination, reclassification or similar change in the
capital structure of the Company without consideration, then (a) the number of
Shares reserved for issuance under this Plan, (b) the Exercise Prices of and
number of Shares subject to outstanding Options, and (c) the number of Shares
subject to other outstanding Awards will be proportionately adjusted, subject to
any required action by the Board or the stockholders of the Company and
compliance with applicable

                                       1
<PAGE>   2

securities laws; provided, however, that fractions of a Share will not be issued
but will either be replaced by a cash payment equal to the Fair Market Value of
such fraction of a Share or will be rounded up to the nearest whole Share, as
determined by the Administrator.

5. ADMINISTRATION OF THIS PLAN.

     5.1  Authority. Authority to control and manage the operation and
administration of this Plan shall be vested in the Board, which may delegate
such responsibilities in whole or in part to a committee consisting of two (2)
or more members of the Board, all of whom are Outside Directors and who satisfy
the requirements under the Exchange Act for administering this Plan (the
"Committee"). Members of the Committee may be appointed from time to time by,
and shall serve at the pleasure of, the Board. The Board at any time may abolish
the Committee and reinvest in the Board the administration of this Plan. As used
herein, the term "Administrator" means the Board or, with respect to any matter
as to which responsibility has been delegated to the Committee, the term
Administrator shall mean the Committee.

     5.2. Interpretation. Subject to the express provisions of this Plan, the
Administrator shall have the authority to construe and interpret this Plan and
any agreements defining the rights and obligations of the Company and
Participants under this Plan; to select Participants; determine the form and
terms of Awards; determine the number of Shares or other consideration subject
to Awards; determine whether Awards will be granted singly, in combination with,
in tandem with, in replacement of, or as alternatives to, other Awards under
this Plan or any other incentive or compensation plan of the Company; to further
define the terms used in this Plan; to correct any defect or supply any omission
or reconcile any inconsistency in this Plan or in any Award Agreement; to
provide for rights of refusal and/or repurchase rights; to amend outstanding
Award Agreements to provide for, among other things, any change or modification
which the Administrator could have provided for upon the grant of an Award or in
furtherance of the powers provided for herein; to prescribe, amend and rescind
rules and regulations relating to the administration of this Plan; to determine
the duration and purposes of leaves of absence which may be granted to
Participants without constituting a termination of their employment for purposes
of this Plan; to accelerate the vesting of any Award; and to make all other
determinations necessary or advisable for the administration of this Plan.

     Any  decision or action of the Administrator in connection with this Plan
or Awards granted or shares of Stock purchased under this Plan shall be final
and binding. The Administrator shall not be liable for any decision, action or
omission respecting this Plan, or any Awards granted or shares of Stock sold
under this Plan.

     5.3  Limitation on Liability. To the extent permitted by applicable law in
effect from time to time, no member of the Committee or the Board of Directors
shall be liable for any action or omission of any other member of the Committee
or the Board of Directors nor for any act or omission on the member's own part,
excepting only the member's own willful misconduct or gross negligence, arising
out of or related to this Plan. The Company shall pay expenses incurred by, and
satisfy a judgment or fine rendered or levied against, a present or former
director or member of the Committee or Board in any action against such person
(whether or not the Company is joined as a party defendant) to impose liability
or a penalty on such person for an act alleged to have been committed by such
person while a director or member of the Committee or Board arising with respect
to this Plan or administration thereof or out of membership on the Committee or
Board or by the Company, or all or any combination of the preceding, provided,
the director or Committee member was acting in good faith, within what such
director or Committee member reasonably believed to have been within the scope
of his or her employment or authority

                                       2
<PAGE>   3

and for a purpose which he or she reasonably believed to be in the best
interests of the Company or its stockholders. Payments authorized hereunder
include amounts paid and expenses incurred in settling any such action or
threatened action. The provisions of this section shall apply to the estate,
executor, administrator, heirs, legatees or devisees of a director or Committee
member, and the term "person" as used on this section shall include the estate,
executor, administrator, heirs, legatees, or devisees of such person.

6. GRANT OF OPTIONS; TERMS AND CONDITIONS OF GRANT.

     6.1. Grant of Options. One or more Options may be granted to any Eligible
Person. Subject to the express provisions of this Plan, the Administrator shall
determine from the Eligible Persons those individuals to whom Options under this
Plan may be granted. An Option may be granted with or without a Tandem Right.
Each Option granted under this Plan will be evidenced by an Award Agreement,
which will expressly identify the Option as an Incentive Stock Option or a
Non-qualified Stock Option.

     Further, subject to the express provisions of this Plan, the Administrator
shall specify the Grant Date, the number of Shares covered by the Option, the
exercise price and the terms and conditions for exercise of the Options. If the
Administrator fails to specify the Grant Date, the Grant Date shall be the date
of the action taken by the Administrator to grant the Option. As soon as
practicable after the Grant Date, the Company will provide the Participant with
a written Award Agreement in the form approved by the Administrator, which sets
out the Grant Date, the number of Shares covered by the Option, the exercise
price and the terms and conditions for exercise of the Option. If the Option is
granted in connection with a Tandem Right, the Award Agreement shall also
specify the terms that apply to the exercise of the Option and Tandem Right. The
maximum number of Shares subject to Options which can be granted under the Plan
during any calendar year to any individual is 750,000 shares.

     The  Administrator may, in its absolute discretion, grant Options under
this Plan at any time and from time to time before the expiration of this Plan.

     6.2. General Terms and Conditions. Except as otherwise provided herein, the
Options shall be subject to the following terms and conditions and such other
terms and conditions not inconsistent with this Plan as the Administrator may
impose:

          6.2.1. Exercise of Option. The Administrator may determine in its
discretion whether any Option shall be subject to vesting and the terms and
conditions of any such vesting. The Award Agreement shall contain any such
vesting schedule.

          6.2.2. Option Term. Each Option and all rights or obligations
thereunder shall expire on such date as shall be determined by the
Administrator, but not later than 10 years after the grant of the Option (5
years in the case of an Incentive Stock Option when the Optionee owns more than
10% of the total combined voting power of all classes of stock of the Company
("Ten Percent Stockholder")), and shall be subject to earlier termination as
hereinafter provided.

          6.2.3. Exercise Price. The Exercise Price of any Option shall be
determined by the Administrator when the Option is granted and may not be less
than one hundred percent (100%)

                                       3
<PAGE>   4

of the Fair Market Value of the Shares on the date of grant, and the Exercise
Price of any Incentive Stock Option granted to a Ten Percent Stockholder will
not be less than one hundred ten percent (110%) of the Fair Market Value of the
Shares on the date of grant. Payment for the Shares purchased shall be made in
accordance with Section 10 of this Plan. The Administrator is authorized to
issue Options, whether Incentive Stock Options or Non-qualified Stock Options,
at an Option price in excess of the Fair Market Value on the date the Option is
granted (the so-called "Premium Price" Option) to encourage superior
performance.

          6.2.4. Method of Exercise. Options may be exercised only by delivery
to the Company of a written stock option exercise agreement (the "Exercise
Agreement") in a form approved by the Administrator (which need not be the same
for each Participant), stating the number of Shares being purchased, the
restrictions imposed on the Shares purchased under such Exercise Agreement, if
any, and such representations and agreements regarding the Participant's
investment intent and access to information and other matters, if any, as may be
required or desirable by the Company to comply with applicable securities laws,
together with payment in full of the Exercise Price for the number of Shares
being purchased. The exercise or partial exercise of either an Option or its
Tandem Right shall result in the termination of the other the extent of the
number of Shares with respect to which the Option or Tandem Right is exercised.

          6.2.5. Transferability of Options. Except as otherwise provided below
for Non-qualified Stock Options, no Option shall be transferable other than by
will or by the laws of descent and distribution and during the lifetime of a
Participant, only the Participant, his guardian or legal representative may
exercise an Option. A Participant may designate a beneficiary to exercise his or
her Options after the Participant's death. At its discretion, the Administrator
may provide for transfer of an Option (other than an Incentive Stock Option),
without payment of consideration, to the following family members of the
Participant, including adoptive relationships: a child, stepchild, grandchild,
parent, stepparent, grandparent, spouse, sibling, mother-in-law, father-in-law,
son-in-law, daughter-in-law, brother-in-law, sister-in-law, niece, nephew,
former spouse (whether by gift or pursuant to a domestic relations order), any
person sharing the employee's household (other than a tenant or employee), a
family-controlled partnership, corporation, limited liability company and trust,
or a foundation in which family members heretofore described control the
management of assets. The assigned portion may only be exercised by the person
or persons who acquire a proprietary interest in the Option pursuant to the
assignment. The terms applicable to the assigned portion shall be the same as
those in effect for the Option immediately prior to such assignment and shall be
set forth in such documents issued to the assignee as the Administrator may deem
appropriate. A request to assign an Option may be made only by delivery to
Company of a written stock option assignment request (the "Assignment Request")
in a form approved by the Administrator, stating the number of Options and
Shares underlying Options requested for assignment, that no consideration is
being paid for the assignment, identifying the proposed transferee, and
containing such other representations and agreements regarding the Participant's
investment intent and access to information and other matters, if any, as may be
required or desirable by Company to comply with applicable securities laws.

          6.2.6. Exercise After Certain Events.

               i.   Termination of Employment - Employee/Officer

                    (1)  Incentive Stock Options.

                         (a)  Termination of All Services. If for any reason
other than retirement (as defined below), permanent and total disability (as
defined below) or death, a Participant Terminates employment with the Company
or a Subsidiary (including

                                       4
<PAGE>   5

employment as an officer of Company or a Subsidiary), vested Incentive Stock
Options held at the date of such termination (to the extent then exercisable)
may be exercised, in whole or in part, at any time within three (3) months after
the date of such Termination or such lesser period specified in the Award
Agreement (but in no event after the earlier of (i) the expiration date of the
Incentive Stock Option as set forth in the Award Agreement, and (ii) ten years
from the Grant Date (five years for a Ten Percent Stockholder)).

                         (b)  Continuation of Services as Consultant/Advisor.
If a Participant granted an Incentive Stock Option terminates employment but
continues as a consultant, advisor or in a similar capacity to the Company or a
Subsidiary, Participant need not exercise the Incentive Stock Option within
three months of termination of employment but shall be entitled to exercise
within three (3) months of termination of services to Company or the Subsidiary
(one (1) year in the event of permanent and total disability or death) but in no
event beyond the expiration date of the Option as set forth in the Award
Agreement. However, if Participant does not exercise within three (3) months of
termination of employment, the Option will not qualify as an Incentive Stock
Option.

                    (2)  Non-Qualified Stock Options. If for any reason other
than retirement (as defined below), permanent and total disability (as defied
below) or death a Participant ceases to be employed by or to be a consultant or
a director of the Company or a Subsidiary, vested Non-qualified Stock Options
held at the date of such Termination (to the extent then exercisable) may be
exercised, in whole or in part, within three (3) months of the date of such
Termination (but in no event after the earlier of (i) the expiration date of the
Option as set forth in the Award Agreement, and (ii) ten years from the Grant
Date), or such lesser period specified by the Administrator.

               ii.  Retirement. If a Participant granted an Option ceases to be
an employee of Company or Subsidiary (including as an officer of Company or
Subsidiary) as a result of Retirement, Participant need not exercise the Option
within three (3) months of Termination of employment but shall be entitled to
exercise the Option within the maximum term of the Option to the extent the
Option was otherwise exercisable at the date of Retirement. However, if
Participant does not exercise within three (3) months of termination of
employment, the Option will not qualify as an Incentive Stock Option if it
otherwise so qualified. The term "Retirement" as used herein means such
Termination of employment as shall entitle the Participant to early or normal
retirement benefits under any then existing pension or salary continuation plans
of Company or Subsidiary excluding 401(k) participants (except as otherwise
covered under other pension or salary continuation plans).

               iii. Permanent Disability and Death of Employee/Officer. If a
Participant becomes permanently and totally disabled (within the meaning of
Section 22(e)(3) of the Code), or dies, while employed by Company or Subsidiary
(including as an officer of Company or Subsidiary), or within the three (3)
months after Termination of employment, vested Options, whether Incentive Stock
Options or Non-qualified Options, then held (to the extent then exercisable) may
be exercised by the Participant, the Participant's personal representative, or
by the person to whom the Option is transferred by will or the laws of descent
and distribution, in whole or in part, at any time within one (1) year after the
disability or death or any lesser period specified in the Award Agreement (but
in no event after the earlier of (i) the expiration date of the Option as set
forth in the Award Agreement, and (ii) ten years from the Grant Date (five years
for a Ten Percent Stockholder).

                                       5
<PAGE>   6

               iv.  Termination of Directorship. If for any reason, including
permanent and total disability or death, a Participant ceases to be a director
of Company or Subsidiary, vested Options held at the date of such termination
(to the extent then exercisable) may be exercised, in whole or in part, at any
time during the maximum term of the Option (but in no event after the earlier of
(i) the expiration date of the Option as set forth in the Award Agreement, and
(ii) ten years from the Grant Date). However, if Participant holds Incentive
Stock Options and does not exercise within three (3) months from the termination
of employment, the Options will not qualify as an Incentive Stock Options.

          6.2.7. Suspension and Cancellation of Options. In the event the
Administrator reasonably believes a Participant has committed an act of
misconduct including, but limited to acts specified below, the Administrator may
suspend the Participant's right to exercise any Option granted hereunder pending
final determination by the Board. If a Participant is determined by the Board to
have: (i) committed an act of embezzlement, fraud, dishonesty, breach of
fiduciary duty to Company or a Subsidiary; (ii) deliberately disregarded the
rules of Company or a Subsidiary which resulted in loss, damage or injury to
Company or a Subsidiary; (iii) made any unauthorized disclosure of any trade
secret or confidential information of Company or a Subsidiary; (iv) induced any
client or customer of Company or a Subsidiary to break any contract with Company
or a Subsidiary or induced any principal for whom Company or a Subsidiary acts
as agent to terminate such agency relations; or (v) engaged in any substantial
conduct which constitutes unfair competition with Company or a Subsidiary,
neither the Participant nor his estate shall be entitled to exercise any Option
hereunder. The determination of the Board shall be final and conclusive. In
making its determination, the Board shall give the Participant an opportunity to
appear and be heard at a hearing before the full Board and present evidence on
the Participant's behalf. Without limiting the generality of the foregoing, the
Agreement may provide that the Participant shall also pay to Company any gain
realized by the Participant from exercising all or any portion of the Options
hereunder during a period beginning six (6) months prior to such suspension or
cancellation.

          The  Administrator may provide in the Agreement that cancellation of
the Option shall also apply if the Participant is determined by the Board to
have:

               i.   engaged in any commercial activity in competition with any
part of the business of Company or a Subsidiary;

               ii.  diverted or attempted to divert from Company or a Subsidiary
business of any kind, including, without limitation, interference with any
business relationship with suppliers, customers, licensees, licensors or
contractors;

               iii. made, or caused or attempted to cause any other person to
make, any statement, either written or oral, or conveying any information about
Company or a Subsidiary which is disparaging or which in any way reflects
negatively upon Company or a Subsidiary;

               iv.  engaged in any other activity that is inimical, contrary or
harmful to the interests of Company or a Subsidiary, including influencing or
advising any person who is employed by or in the service of Company or a
Subsidiary to leave such employment or service to compete with Company or a
Subsidiary or to enter into the employment or service of any actual or
prospective competitor of Company or a Subsidiary, or to have influenced or
advised any competitor of Company or a Subsidiary to employ or to otherwise
engage the services of any person who is employed by Company or in the service
of Company, or improperly disclosed or otherwise misused any confidential
information regarding Company or a Subsidiary; or

                                       6
<PAGE>   7

               v.   refused or failed to provide, upon the request of Company or
a Subsidiary, a certification, in a form satisfactory to Company or a
Subsidiary, that he or she is in full compliance with the terms and conditions
of this Plan.

     Should any provision to this Section 6.2.7. be held to be invalid or
illegal, such illegality shall not invalidate the whole of this Section 6, but,
rather, this Plan shall be construed as if it did not contain the illegal part
or narrowed to permit its enforcement, and the rights and obligations of the
parties shall be construed and enforced accordingly.

     6.3. Limitations on Grant of Incentive Stock Options.

          6.3.1. The aggregate Fair Market Value (determined as of the Grant
Date) of the Stock for which Incentive Stock Options may first become
exercisable by any Participant during any calendar year under this Plan,
together with that of Shares subject to Incentive Stock Options first
exercisable (other than as a result of acceleration pursuant to Sections 21 or
22) by such Participant under any other plan of the Company or any Subsidiary,
shall not exceed $100,000. For purposes of this Section 6.3.1, all Shares in
excess of the $100,000 threshold shall be treated as Non-qualified Stock
Options.

          6.3.2. There shall be imposed in the Award Agreement relating to
Incentive Stock Options such terms and conditions as are required in order that
the Option be an "incentive stock option" as that term is defined in Code
Section 422.

          6.3.3. No Incentive Stock Option may be granted to any person who is
not an employee of the Company or a Subsidiary of the Company.

7. RESTRICTED STOCK. A Restricted Stock Award is an offer by the Company to sell
to an eligible person Shares that are subject to restrictions. The Administrator
will determine to whom an offer will be made, the number of Shares the person
may purchase, the price to be paid (the "Purchase Price"), the restrictions to
which the Shares will be subject, the duration of the restrictions ("Restricted
Period"), and all other terms and conditions of the Restricted Stock Award,
subject to the following:

     7.1. Form of Restricted Stock Award. All purchases under a Restricted Stock
Award made pursuant to this Plan will be evidenced by an Award that will be in
such form (which need not be the same for each Participant) as the Administrator
will from time to time approve, and will comply with and be subject to the terms
and conditions of this Plan. The offer of Restricted Stock will be accepted by
the Participant's execution and delivery of the Award Agreement and full payment
for the Shares to the Company within thirty (30) days from the date the Award
Agreement is delivered to the person. If such person does not execute and
deliver the Award Agreement along with full payment for the Shares to the
Company within thirty (30) days, then the offer will terminate, unless otherwise
determined by the Administrator.

     7.2. Purchase Price. The Purchase Price of Shares sold pursuant to a
Restricted Stock Award will be determined by the Administrator and will be at
least eighty-five percent (85%) of the Fair Market Value of the Shares on the
date the Restricted Stock Award is granted. Payment of the Purchase Price shall
be made in accordance with Section 10 of this Plan.

     7.3. Rights of Holder; Limitations Thereon. Upon a grant of Restricted
Stock, a stock certificate (or certificates) representing the number of Shares
of Restricted Stock granted to the

                                       7
<PAGE>   8

Participant shall be registered in the Participant's name and shall be held in
custody by the Company or a bank selected by the Administrator for the
Participant's account. Following such registration, the Participant shall have
the rights and privileges of a stockholder as to such Restricted Stock,
including the right to receive dividends, if and when declared by the Board, and
to vote such Restricted Stock, except that the right to receive cash dividends
shall be the right to receive such dividends either in cash currently or by
payment in Restricted Stock, as the Administrator shall determine, and except
further that, the following restrictions shall apply:

          7.3.1. The Participant shall not be entitled to delivery of a
certificate until the expiration or termination of the Restricted Period for the
Shares represented by such certificate and the satisfaction of any and all other
conditions prescribed by the Administrator;

          7.3.2. All of the Shares of Restricted Stock that have not vested
shall be forfeited and all rights of the Participant to such Shares of
Restricted Stock shall terminate without further obligation on the part of the
Company, unless the Participant has remained an employee of (or non-Employee
Director of or active consultant providing services to) the Company or any of
its Subsidiaries, until the expiration or termination of the Restricted Period
and the satisfaction of any and all other conditions prescribed by the
Administrator applicable to such Shares of Restricted Stock. Upon the forfeiture
of any Shares of Restricted Stock, such forfeited Shares shall be transferred to
the Company without further action by the Participant and shall, in accordance
with Section 4.1, again be available for grant under this Plan. If the
Participant paid any amount for the Shares of Restricted Stock that are
forfeited, the Company shall pay the Participant the lesser of the Fair Market
Value of the Shares on the date they are forfeited or the amount paid by the
Participant.

     7.4. Delivery of Unrestricted Shares. Upon the expiration or termination of
the Restricted Period for any Shares of Restricted Stock and the satisfaction of
any and all other conditions prescribed by the Administrator, the restrictions
applicable to such Shares of Restricted Stock shall lapse and a stock
certificate for the number of Shares of Restricted Stock with respect to which
the restrictions have lapsed shall be delivered, free of all such restrictions
except any that may be imposed by law, a stockholders' agreement or any other
agreement, to the holder of the Restricted Stock. The Company shall not be
required to deliver any fractional Share but will pay, in lieu thereof, the Fair
Market Value (determined as of the date the restrictions lapse) of such
fractional Share to the holder thereof. Concurrently with the delivery of a
certificate for Restricted Stock, the holder shall be required to pay an amount
necessary to satisfy any applicable federal, state and local tax requirements as
set out in Section 11 below.

     7.5. Nonassignability of Restricted Stock. Unless the Administrator
provides otherwise in the Award Agreement, no grant of, nor any right or
interest of a Participant in or to, any Restricted Stock, or in any instrument
evidencing any grant of Restricted Stock under this Plan, may be assigned,
encumbered or transferred except, in the event of the death of a Participant, by
will or the laws of descent and distribution.

     7.6. Restrictions. Restricted Stock Awards will be subject to such
restrictions (if any) as the Administrator may impose. The Administrator may
provide for the lapse of such restrictions in installments and may accelerate or
waive such restrictions, in whole or part, based on length of service,
performance or such other factors or criteria as the Administrator may
determine.

8.       STOCK BONUSES.

                                   8
<PAGE>   9

     8.1. Awards of Stock Bonuses. A Stock Bonus is an award of Shares (which
may consist of Restricted Stock) for services rendered to the Company. A Stock
Bonus may be awarded pursuant to an Award Agreement that will be in such form
(which need not be the same for each Participant) as the Administrator will from
time to time approve, and will comply with and be subject to the terms and
conditions of this Plan. The award may also be paid in cash, or Shares and cash,
as determined by the Administrator in accordance with Section 8.3 below. Stock
Bonuses may vary from Participant to Participant and between groups of
Participants, and may be based upon the achievement of the Company and/or
individual performance factors or upon such other criteria as the Administrator
may determine. A Stock Bonus may be awarded upon satisfaction of such
performance goals as are set out in advance in the Participant's individual
Award Agreement that will be in such form (which need not be the same for each
Participant) as the Administrator will from time to time approve, and will
comply with and be subject to the terms and conditions of this Plan.

     8.2. Terms of Stock Bonuses. The Administrator will determine the number of
Shares to be awarded to the Participant and whether such Shares will be
Restricted Stock. If the Stock Bonus is being earned upon the satisfaction of
performance goals pursuant to a Award Agreement, then the Administrator will
determine (a) the nature, length and starting date of any period during which
performance is to be measured (the "Performance Period") for each Stock Bonus;
(b) the performance goals and criteria to be used to measure the performance, if
any; (c) the number of Shares that may be awarded to the Participant; and (d)
the extent to which such Stock Bonuses have been earned. Performance Periods may
overlap and Participants may participate simultaneously with respect to Stock
Bonuses that are subject to different Performance Periods and different
performance goals and other criteria. The number of Shares may be fixed or may
vary in accordance with such performance goals and criteria as may be determined
by the Administrator. The Administrator may adjust the performance goals
applicable to the Stock Bonuses to take into account changes in law and
accounting or tax rules and to make such adjustments, as the Administrator deems
necessary or appropriate to reflect the impact of extraordinary or unusual
items, events or circumstances.

     8.3. Form of Payment. The earned portion of a Stock Bonus may be paid
currently or on a deferred basis with such interest or dividend equivalent, if
any, as the Administrator may determine. Payment may be made in the form of
cash, whole Shares, including Restricted Stock, or a combination thereof, either
in a lump sum payment or in installments, all as the Administrator determines.

     8.4. Termination During Performance Period. If a Participant is Terminated
during a Performance Period for any reason, then such Participant will be
entitled to payment (whether in Shares, cash or otherwise) with respect to the
Stock Bonus only to the extent earned as of the Termination Date in accordance
with the Award Agreement, unless the Administrator determines otherwise.

9. STOCK APPRECIATION RIGHTS.

     9.1. Awards of Stock Appreciation Rights. A Stock Appreciation Right is an
award to receive a number of Shares (which may consist of Restricted Stock), or
cash, or Shares and cash, as determined by the Administrator in accordance with
Section 9.5 below, for services rendered to the Company. A Stock Appreciation
Right may be awarded pursuant to an Award Agreement that will be in such form
(which need not be the same for each Participant) as the Administrator will from
time to time approve, and will comply with and be subject to the terms and
conditions of this Plan. A Stock Appreciation Right may vary from Participant

                                       9
<PAGE>   10

to Participant and between groups of Participants, and may be based upon the
achievement of the Company and/or individual performance factors or upon such
other criteria as the Administrator may determine.

     9.2. Grant. The Administrator shall determine at the time of the grant of a
Stock Appreciation Right the time period during which the Stock Appreciation
Right may be exercised, which period may not commence until six months after the
date of grant. A Stock Appreciation Right may be granted with or without a
related Option. In the case of a related Incentive Stock Option, a payment to
the Participant upon the exercise of a Tandem Right may not be more than the
difference between the Fair Market Value of the Shares subject to the Incentive
Stock Option on the date of grant and the Fair Market Value of the Shares on the
date of exercise of the Tandem Right. The maximum number of Shares subject to
Stock Appreciation Rights which can be granted under the Plan during any
calendar year to any individual is 750,000 shares.

     9.3. Duration. The duration of a Stock Appreciation Right shall be set
forth inthe Award Agreement as determined by the Administrator. A Stock
Appreciation Right that is granted as a Tandem Right shall have the same
duration as the Option with which it relates.

     9.4. Exercise. A Stock Appreciation Right shall entitle a Participant to
receive a number of Shares (without any payment to the Company, except for
applicable withholding taxes), cash, or Shares and cash, as determined by the
Administrator in accordance with Section 9.4 below. If a Stock Appreciation
Right is issued in tandem with an Option, except as may otherwise be provided by
the Administrator, the Tandem Right shall be exercisable during the period that
its related Option is exercisable. A Participant desiring to exercise a Stock
Appreciation Right shall give written notice of such exercise to the Company,
which notice shall state the proportion of Stock and cash that the Participant
desires to receive pursuant to the Stock Appreciation Right exercised subject to
the discretion of the Administrator. Upon receipt of the notice from the
Participant, the Company shall deliver to the person entitled thereto (i) a
certificate or certificates for Shares and/or (ii) a cash payment, in accordance
with Section 9.4 below. The date the Company receives written notice of such
exercise hereunder is referred to in this Section 9 as the "exercise date." The
delivery of Shares or cash received pursuant to such exercise shall take place
at the principal offices of the Company within 30 days following delivery of
such notice.

     9.5. Number of Shares or Amount of Cash. Subject to the discretion of the
Administrator to substitute cash for Shares, or Shares for cash, the amount of
Shares which may be issued pursuant to the exercise of a Stock Appreciation
Right shall be determined by dividing: (a) the total number of Shares as to
which the Stock Appreciation Right is exercised, multiplied by the amount by
which the Fair Market Value of the Shares on the exercise date exceeds the Fair
Market Value the Shares on the date of grant of the Stock Appreciation Right, by
(b) the Fair Market Value of the Shares on the exercise date; provided, however,
that fractional Shares shall not be issued and in lieu thereof, a cash
adjustment shall be paid. In lieu of issuing Shares upon the exercise of a Stock
Appreciation Right, the Administrator in its sole discretion may elect to pay
the cash equivalent of the Fair Market Value of the Shares on the exercise date
for any or all of the Shares that would otherwise be issuable upon exercise of
the Stock Appreciation Right.

     9.6. Effect of Exercise. A partial exercise of a Stock Appreciation Right
shall not affect the right to exercise the remaining Stock Appreciation Right
from time to time in accordance with this Plan and the applicable Award
Agreement with respect to the remaining shares subject to the Stock Appreciation
Right. The exercise of either an Option or Tandem

                                       10
<PAGE>   11

Right shall result in the termination of the other to the extent of the number
of Shares with respect to which the Option or its Tandem Right is exercised.

     9.7. Transferability of Stock Appreciation Rights Generally.

          9.7.1. Transferability of Stock Appreciation Rights. No Award under
Section 9. shall be transferable other than by will or by the laws of descent
and distribution and during the lifetime of a Participant, only the Participant,
his guardian or legal representative may exercise an Award. A Participant may
designate a beneficiary to exercise his or her Award after the Participant's
death. However, the Administrator may provide for transfer of an Award without
payment of consideration, to the following family members of the Participant,
including adoptive relationships: a child, stepchild, grandchild, parent,
stepparent, grandparent, spouse, sibling, mother-in-law, father-in-law,
son-in-law, daughter-in-law, brother-in-law,sister- in-law, niece, nephew,
former spouse (whether by gift or pursuant to a domestic relations order), any
person sharing the employee's household (other than a tenant or employee), a
family-controlled partnership, corporation, limited liability company and trust,
or a foundation in which family members heretofore described control the
management of assets. The assigned portion may only be exercised by the person
or persons who acquire a proprietary interest in the Award pursuant to the
assignment. The terms applicable to the assigned portion shall be the same as
those in effect for the Award immediately prior to such assignment and shall be
set forth in such documents issued to the assignee as the Administrator may deem
appropriate.

          9.7.2. Transferability of Tandem Rights. The same transfer restriction
shall apply to a Tandem Right as are applied to the corresponding Option under
Section 6.2.5.

          9.8. Termination of Employment. Upon the Termination of employment or
other services of a Participant, any Stock Appreciation Rights then held by such
Participant shall be exercisable within the time periods, and upon the same
conditions with respect to the reasons for termination of employment or other
services, as are specified in Section 6.2.6. with respect to Options.

          9.9  Suspension and Cancellation of Stock Appreciation Rights. Stock
Appreciation Rights shall be subject to suspension and cancellation under the
same conditions as are specified in Section 6.2.7 with respect to Options.

10. PAYMENT FOR SHARE PURCHASES.

     10.1. Payment. Payment for Shares purchased pursuant to this Plan may be
made in cash (by check) or, where expressly approved for the Participant at the
discretion of the Administrator and where permitted by law:

          10.1.1. by cancellation of indebtedness of the Company to the
Participant;

          10.1.2. by surrender of shares of Stock of the Company that either:
(1) have been owned by the Participant for more than six (6) months (and, if
such shares were purchased from the Company by use of a promissory note, such
note has been fully paid with respect to such shares); or (2) were obtained by
the Participant in the public market;

          10.1.3. by tender of a full recourse promissory note having such terms
as may be approved by the Administrator and bearing interest at a rate
sufficient to avoid imputation of income under Code Sections 483 and 1274;
provided, however, that Participants who are not

                                       11
<PAGE>   12

employees or directors of the Company will not be entitled to purchase Shares
with a promissory note unless the note is adequately secured by collateral other
than the Shares;

          10.1.4. with respect only to purchases upon exercise of an Option, and
provided that a public market for the Company's stock exists:

               i.   through a "same day sale" commitment from the Participant
and a broker-dealer that is a member of the National Association of Securities
Dealers (a "NASD Dealer") whereby the Participant irrevocably elects to exercise
the Option and to sell a portion of the Shares so purchased to pay for the
Exercise Price, and whereby the NASD Dealer irrevocably commits upon receipt of
such Shares to forward the Exercise Price directly to the Company; or

               ii.  through a "margin" commitment from the Participant and a
NASD Dealer whereby the Participant irrevocably elects to exercise the Option
and to pledge the Shares so purchased to the NASD Dealer in a margin account as
security for a loan from the NASD Dealer in the amount of the Exercise Price,
and whereby the NASD Dealer irrevocably commits upon receipt of such Shares to
forward the Exercise Price directly to the Company; or

          10.1.5. by any combination of the foregoing methods of payment or any
other consideration or method of payment as shall be permitted by applicable
corporate law.

The Administrator may provide, in an Agreement or otherwise, that a Participant
who exercises an Option and pays the Exercise Price in whole or in part with
Stock then owned by the Participant will be entitled to receive another Option
covering the same number of shares tendered and with a price of no less than
Fair Market Value on the date of grant of such additional Option ("Reload
Option"). Unless otherwise provided in the Agreement, a Participant, in order to
be entitled to a Reload Option, must pay with Stock that has been owned by the
Participant for at least the preceding six (6) months.

          10.2. Loan Guarantees. At its sole discretion, the Administrator may
help the Participant pay for Shares purchased under this Plan by authorizing a
guarantee by the Company of a third-party loan to the Participant.

11. WITHHOLDING TAXES.

          11.1. Withholding Generally. Whenever Shares are to be issued in
satisfaction of Awards granted under this Plan, the Company may require the
Participant to remit to the Company an amount sufficient to satisfy federal,
state and local taxes and FICA withholding requirements prior to the delivery of
any certificate or certificates for such Shares. When, under applicable tax
laws, a Participant incurs tax liability in connection with the exercise or
vesting of any Award, the disposition by a Participant or other person of Awards
of Shares of an Option prior to satisfaction of the holding period requirements
of Section 422 of the Code, or upon the exercise of a Non-qualified Stock
Option, the Company shall have the right to require such Participant or such
other person to pay by cash, or check payable to the Company, the amount of any
such withholding with respect to such transactions. Any such payment must be
made promptly when the amount of such obligation becomes determinable (the "Tax
Date").

          11.2. Stock for Withholding. To the extent permissible under
applicable tax, securities and other laws, the Administrator may, in its sole
discretion and upon such terms and conditions as it may deem appropriate, permit
a Participant to satisfy his or her obligation to pay any such withholding tax,
in whole or in part, with Stock up to an amount not greater than the Company's

                                       12
<PAGE>   13

minimum statutory withholding rate for federal and state tax purposes, including
payroll taxes, that are applicable to such supplemental taxable income. The
Administrator may exercise its discretion, by (a) directing the Company to apply
shares of Stock to which the Participant is entitled as a result of the exercise
of an Option, or (b) delivering to the Company shares of Stock owned by the
Participant (other than in connection with an option exercise triggering
withholding taxes within the last six (6) months). The shares of Stock so
applied or delivered for the withholding obligation shall be valued at their
Fair Market Value as of the date of measurement of the amount of income subject
to withholding.

12. PRIVILEGES OF STOCK OWNERSHIP. No Participant will have any of the rights of
a stockholder with respect to any Shares until the Shares are issued to the
Participant. After Shares are issued to the Participant, the Participant will be
a stockholder and have all the rights of a stockholder with respect to such
Shares, including the right to vote and receive all dividends or other
distributions made or paid with respect to such Shares; provided, that if such
Shares are Restricted Stock, then any new, additional or different securities
the Participant may become entitled to receive with respect to such Shares by
virtue of a stock dividend, stock split or any other change in the corporate or
capital structure of the Company will be subject to the same restrictions as the
Restricted Stock; and provided, further, that the Participant will have no right
to retain such stock dividends or stock distributions with respect to Shares
that are repurchased at the Participant's Exercise Price or Purchase Price
pursuant to Section 14. Subject to Sections 20 and 21, no adjustment shall be
made for dividends or other rights for which the record date is prior to the
date title to the shares of Stock has been acquired by the Participant.

13. TRANSFERABILITY. Unless otherwise provided, Awards granted under this Plan,
and any interest therein, will not be transferable or assignable by the
Participant, and may not be made subject to execution, attachment or similar
process, otherwise than by will or by the laws of descent and distribution or as
consistent with the Award Agreement provisions relating thereto. Unless
otherwise provided in this Plan, during the lifetime of the Participant an Award
will be exercisable only by the Participant, and any elections with respect to
an Award may be made only by the Participant.

14. RESTRICTION ON SHARES. At the discretion of the Administrator, the Company
may reserve to itself and/or its assignee(s) in the Award Agreement a right to
repurchase at the Exercise Price or the Purchase Price of the Shares acquired
under an Award or impose other restrictions on such Shares during a period not
to exceed one hundred eighty (180) days from the date of exercise or purchase.
After one hundred eighty (180) days, at the discretion of the Administrator, the
Company may reserve to itself and/or its assignee(s) in the Award Agreement a
right to repurchase the Shares acquired under an Award at the Fair Market Value
at the time of repurchase. The terms and conditions of any such rights or other
restrictions shall be set forth in the Award Agreement evidencing the Option.

15. CERTIFICATES. All certificates for Shares or other securities delivered
under this Plan will be subject to such stock transfer orders, legends and other
restrictions as the Administrator may deem necessary or advisable, including
restrictions under any applicable federal, state or foreign securities law, or
any rules, regulations and other requirements of the SEC or any stock exchange
or automated quotation system upon which the Shares may be listed or quoted.

16. ESCROW, PLEDGE OF SHARES. To enforce any restrictions on a Participant's
Shares, the Administrator may require the Participant to deposit all
certificates representing Shares, together with stock powers or other
instruments of transfer approved by the Administrator, appropriately endorsed in
blank, with the Company or an agent designated by the

                                       13
<PAGE>   14

Company to hold in escrow until such restrictions have lapsed or terminated, and
the Administrator may cause a legend or legends referencing such restrictions to
be placed on the certificates. Any Participant who is permitted to execute a
promissory note as partial or full consideration for the purchase of Shares
under this Plan will be required to pledge and deposit with the Company all or
part of the Shares so purchased as collateral to secure the payment of such
Participant's obligation to the Company under the promissory note; provided,
however, that the Administrator may require or accept other or additional forms
of collateral to secure the payment of such obligation and, in any event, the
Company will have full recourse against the Participant under the promissory
note notwithstanding any pledge of the Participant's Shares or other collateral.
In connection with any pledge of the Shares, the Participant will be required to
execute and deliver a written pledge agreement in such form, as the
Administrator will from time to time approve. The Shares purchased with the
promissory note may be released from the pledge on a pro rata basis as the
promissory note is paid.

17. EXCHANGE AND BUYOUT OF AWARDS. The Administrator may, at any time or from
time to time, authorize the Company, with the consent of the respective
Participants, to issue new Awards in exchange for the surrender and cancellation
of any or all outstanding Awards. The Administrator may at any time buy from a
Participant an Award previously granted with payment in cash, Shares (including
Restricted Stock) or other consideration, based on such terms and conditions as
the Administrator and the Participant may agree.

18. SECURITIES LAW AND OTHER REGULATORY COMPLIANCE. An Award will not be
effective unless such Award is in compliance with all applicable federal and
state securities laws, rules and regulations of any governmental body, and the
requirements of any stock exchange or automated quotation system upon which the
Shares may then be listed or quoted, as they are in effect on the date of grant
of the Award and also on the date of exercise or other issuance. Notwithstanding
any other provision in this Plan, the Company will have no obligation to issue
or deliver certificates for Shares under this Plan prior to (a) obtaining any
approvals from governmental agencies that the Company determines are necessary
or advisable; and/or (b) completion of any registration or other qualification
of such Shares under any state or federal laws or rulings of any governmental
body that the Company determines to be necessary or advisable. The Company will
be under no obligation to register the Shares with the SEC or to effect
compliance with the registration, qualification or listing requirements of any
state securities laws, stock exchange or automated quotation system, and the
Company will have no liability for any inability or failure to do so. Upon
exercising all or any portion of an Award, a Participant may be required to
furnish representations or undertakings deemed appropriate by the Company to
enable the offer and sale of the Shares or subsequent transfers of any interest
in such shares to comply with applicable securities laws. Evidences of ownership
of Shares acquired pursuant to an Award shall bear any legend required by, or
useful for purposes of compliance with, applicable securities laws, this Plan or
the Award Agreement.

19. RIGHTS OF EMPLOYEES.

     19.1. No Obligation to Employ. Nothing in this Plan or any Award granted
under this Plan will confer or be deemed to confer on any Participant any right
to continue in the employ of, or to continue any other relationship with, the
Company or to limit in any way the right of the Company to terminate such
Participant's employment or other relationship at any time, with or without
cause.

     19.2. Compliance with Code Section 162(m). At all times when the
Administrator determines that compliance with Code Section 162(m) is required or
desired, all Awards granted

                                       14
<PAGE>   15

under this Plan to Named Executive Officers shall comply with the requirements
of Code Section 162(m). In addition, in the event that changes are made to Code
Section 162(m) to permit greater flexibility with respect to any Award or Awards
under this Plan, the Administrator may, subject to this Section 19, make any
adjustments it deems appropriate.

20. ADJUSTMENT FOR CHANGES IN CAPITALIZATION. The existence of outstanding
Awards shall not affect the Company's right to effect adjustments,
recapitalizations, reorganizations or other changes in its or any other
corporation's capital structure or business, any merger or consolidation, any
issuance of bonds, debentures, preferred or prior preference stock ahead of or
affecting the Stock, the dissolution or liquidation of the Company's or any
other corporation's assets or business or any other corporate act whether
similar to the events described above or otherwise. Shares shall be adjusted
pursuant to Section 4.2.

21. DISSOLUTION, LIQUIDATION, MERGER.

     21.1. Company Not the Survivor. In the event of a dissolution or
liquidation of the Company, a merger, consolidation, combination or
reorganization in which the Company is not the surviving corporation, or a sale
of substantially all of the assets of the Company (as determined in the sole
discretion of the Board of Directors), the Administrator, in its absolute
discretion, may cancel each outstanding Award upon payment in cash to the
Participant of the amount by which any cash and the fair market value of any
other property which the Participant would have received as consideration for
the Shares covered by the Award if the Award had been exercised before such
liquidation, dissolution, merger, consolidation, combination, reorganization or
sale exceeds the exercise price of the Award or negotiate to have such option
assumed by the surviving corporation. In addition to the foregoing, in the event
of a dissolution or liquidation of the Company, see Change of Control Section
22.1 with respect to acceleration in vesting in the event of a merger,
consolidation, combination or reorganization, in which the Company is not the
surviving corporation, the Administrator, in its absolute discretion, may
accelerate the time within which each outstanding Award may be exercised or
negotiate to have such Award assumed by the surviving corporation.

     21.2. Company is the Survivor. In the event of a merger, consolidation,
combination or reorganization in which the Company is the surviving corporation,
the Board of Directors shall determine the appropriate adjustment of the number
and kind of securities with respect to which outstanding Awards may be
exercised, and the exercise price at which outstanding Awards may be exercised.
The Board of Directors shall determine, in its sole and absolute discretion,
when the Company shall be deemed to survive for purposes of this Plan.

22. CHANGE OF CONTROL.

     22.1. Definition. If there is a "change of control" in the Company, all
outstanding Awards shall fully vest immediately upon the Company's public
announcement of such a change. A "change of control" shall mean an event
involving one transaction or a related series of transactions, in which (i) the
Company issues securities equal to 25% or more of the Company's issued and
outstanding voting securities, determined as a single class, to any individual,
firm, partnership, limited liability company, or other entity, including a
"group" within the meaning of SEC Exchange Act Rule 13d-3, (ii) the Company
issues voting securities equal to 25% or more of the issued and outstanding
voting stock of the Company in connection with a merger, consolidation other
business combination, (iii) the Company is acquired in a merger, consolidation,
combination or reorganization in which the Company is not the surviving company,
or (iv) all or substantially all of the Company's assets are sold or
transferred. See

                                       15
<PAGE>   16

Section 21 with respect to Awards vesting upon the occurrence of either of the
events described in (iii) or (iv) of this Section 22 and the result upon the
non-exercise of the Awards.

     22.2. Limitation on Awards. Notwithstanding any other provisions of this
Plan and unless provided otherwise in the Award Agreement, if the right to
receive or benefit from an Award under this Plan, either alone or together with
payments that a Participant has a right to receive from the Company, would
constitute a "parachute payment" (as defined in Code Section 280G), all such
payments shall be reduced to the largest amount that will result in no portion
being subject to the excise tax imposed by Code Section 4999.

23. TERMINATION; AMENDMENT. The Board may amend, suspend or terminate this Plan
at any time and for any reason, but no amendment, suspension or termination
shall be made which would impair the right of any person under any outstanding
Awards without such person's consent not unreasonably withheld. Further, the
Board may, in its discretion, determine that any amendment should be effective
only if approved by the Stockholders even if such approval is not expressly
required by this Plan or by law.

24. DEFERRALS. The Administrator may permit a Participant to defer to another
plan or program such Participant's receipt of Shares or cash that would
otherwise be due to such Participant by virtue of the exercise of an Option, the
exercise of a Stock Appreciation Right, the vesting of Restricted Stock, or the
earning of a Stock Bonus. If any such deferral election is required or
permitted, the Administrator shall, in its sole discretion, establish rules and
procedures for such payment deferrals.

25. GOVERNING LAW. This Plan and the rights of all persons under this Plan shall
be construed in accordance with and under applicable provisions of the laws of
the State of Delaware.

26. DEFINITIONS. As used in this Plan, the following terms will have the
following meanings:

     26.1 "Award" means, individually and collectively, any award under this
Plan, including any Option, Restricted Stock, a Stock Appreciation Right, or
Stock Bonus.

     26.2 "Award Agreement" means, with respect to each Award, the signed
written agreement between the Company and the Participant setting forth the
terms and conditions of the Award.

     26.3 "Board" means the Board of Directors of the Company.

     26.4 "Code" means the Internal Revenue Code of 1986, as amended from time
to time.

     26.5 "Committee" means the Committee appointed by the Board to administer
this Plan, or if no such committee is appointed, the Board.

     26.6 "Company" means AremisSoft Corporation a Delaware corporation and its
subsidiaries, or any successor corporation.

     26.7 "Disability" means a disability, whether temporary or permanent,
partial or total, within the meaning of Section 22(e)(3) of the Code, as
determined by the Committee.

                                       16
<PAGE>   17

     26.8 "Effective Date" has the meaning set forth in Section 2.

     26.9 "Eligible Person" means, in the case of the grant of an Incentive
Stock Option, all employees of the Company or a subsidiary of the Company and,
in the case of a Non-qualified Stock Option, Restricted Stock, Stock
Appreciation Right and Stock Bonus, any director, officer or employee of the
Company or other person who, in the opinion of the Board, is rendering valuable
services to the Company, including without limitation, an independent
contractor, outside consultant, or advisor to the Company.

     26.10 "Exchange Act" means the Securities Exchange Act of 1934, as amended
from time to time and any successor statute.

     26.11 "Exercise Price" means the price at which a holder of an Option may
purchase the Shares issuable upon exercise of the Option.

     26.12 "Fair Market Value" means (i) if the Stock is listed or admitted to
trade on a national securities exchange, the closing price of the Stock on the
Composite Tape, as published in the Western Edition of the Wall Street Journal,
of the principal national securities exchange on which the Stock is so listed or
admitted to trade, on such date, or, if there is no trading of the Stock on such
date, then the closing price of the Stock as quoted on such Composite Tape on
the next preceding date on which there was trading in such Stock; (ii) if the
Stock is not listed or admitted to trade on a national securities exchange, the
closing price for the Stock on such date, as furnished by the National
Association of Securities Dealers, Inc. ("NASD") through the NASDAQ National
Market System or a similar organization if the NASD is no longer reporting such
information; (iii) if the stock is not reported on the National Market System,
the mean between the closing bid and asked prices for the stock on such date, as
furnished by the NASD, and if no bid and asked prices are quoted on such date,
the bid and asked prices on the next preceding day on which such prices were
quoted; and (iv) if the stock is not reported on the National Market System and
if bid and asked prices for the stock are not furnished by the NASD or a similar
organization, the value established by the Administrator for purposes of
granting options under this Plan.

     26.13 "Incentive Stock Option" means an option, which is an option within
the meaning of Section 422 of the Code, the award of which contains such
provisions as are necessary to comply with that section.

     26.14 "Named Executive Officer" means, if applicable, a Participant who, as
of the date of vesting and/or payout of an Award is one of the group of "covered
employees," as defined under in the regulations promulgated under Code Section
162(m), or any successor statute.

     26.15 "NASD Dealer" means a broker-dealer that is a member of the National
Association of Securities Dealers.

     26.16 "Non-qualified Stock Option" means an option, which is designated a
Non-qualified Stock Option.

     26.17 "Officer" means an officer of the Company and an officer who is
subject to Section 16 of the Exchange Act.

                                       17
<PAGE>   18

     26.18 "Outside Director" means any director who is not (a) a current
employee of the Company; (b) a former employee of the Company who is receiving
compensation for prior services (other than benefits under a tax-qualified
pension plan); (c) a current or former officer of the Company; or (d) currently
receiving compensation for personal services in any capacity, other than as a
director, from the Company; as may otherwise be defined in regulations
promulgated under Section 162(m) of the Code.

     26.19 "Option" means an award of an option to purchase Shares pursuant to
Section 6.

     26.20 "Optionee" means the holder of an Option.

     26.21 "Participant" means a person who receives an Award under this Plan.

     26.22 "Plan" means this 2001 Equity Incentive Plan, as amended from time to
time.

     26.23 "Restricted Stock Award" means an award of Shares pursuant to Section
7.

     26.24 "Rule 16b-3" means Rule 16b-3 under Section 16(b) of the Exchange
Act, as amended from time to time, and any successor rule.

     26.25 "SEC" means the Securities and Exchange Commission.

     26.26 "Securities Act" means the Securities Act of 1933, as amended from
time to time.

     26.27 "Shares" means shares of the Company's Common Stock reserved for
issuance under this Plan, as adjusted pursuant to Section 4, and any successor
security.

     26.28 "Stock" means the Common Stock, $.001 par value, of the Company, and
any successor entity.

     26.29 "Stock Appreciation Right" or "SAR" means the right, granted by the
Administrator pursuant to this Plan, to receive a payment equal to the increase
in the Fair Market Value of a Share of Stock subsequent to the grant of such
Award.

     26.30 "Stock Bonus" means an award of Shares, or cash in lieu of Shares,
pursuant to Section 8.

     26.31 "Subsidiary" means any corporation in an unbroken chain of
corporations beginning with the Company if, at the time of granting of an Award,
each of the corporations other than the last corporation in the unbroken chain
owns stock possessing fifty percent (50%) or more of the total combined voting
power of all classes of stock in one of the other corporations in such chain.

     26.32 "Tandem Right" means an Stock Appreciation Right that is granted in
relation to a particular Option and that can be exercised only upon surrender to
the Company, unexercised, of that portion of the Option to which the Stock
Appreciation Right relates.

     26.33 "Termination" or "Terminated" means, for purposes of this Plan with
respect to a Participant, that the Participant has for any reason ceased to
provide services as an employee, officer, director, consultant, independent
contractor or advisor of the Company. An employee

                                       18
<PAGE>   19

will not be deemed to have ceased to provide services in the case of (i) sick
leave, (ii) military leave, or (iii) any other leave of absence approved by the
Administrator; provided, that such leave is for a period of not more than ninety
(90) days, unless reemployment upon the expiration of such leave is guaranteed
by contract or statute or unless provided otherwise pursuant to formal policy
adopted from time to time by the Company and issued and promulgated to employees
in writing. In the case of any employee on an approved leave of absence, the
Administrator may make such provisions respecting suspension of vesting of the
Award while on leave from the employ of the Company as it may deem appropriate,
except that in no event may an Option be exercised after the expiration of the
term set forth in the Award Agreement. The Administrator will have sole
discretion to determine whether a Participant has ceased to provide services and
the effective date on which the Participant ceased to provide services (the
"Termination Date").

     26.34 "Unvested Shares" means "Unvested Shares" as defined in the Award
Agreement.

     26.35 "Vested Shares" means "Vested Shares" as defined in the Award
Agreement.

     26.36 "Vesting Date" means the date on which an Award becomes wholly or
partially exercisable, as determined by the Administrator in its sole
discretion.

                                       19

Source: [{"source": "alea-institute/alea-institute/kl3m-data-edgar-agreements/train-00021-of-00352.parquet"}, [{"source": "alea-institute/alea-institute/kl3m-data-edgar-agreements/train-00021-of-00352.parquet"}]]