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                                                                   EXHIBIT 10.19

                      SENIOR EXECUTIVE EMPLOYMENT AGREEMENT

            This Senior Executive Employment Agreement (the "Agreement") is
entered into as of this 26th day of May, 2005 (the "Effective Date") by and
between Vincent Passione ("Executive") and DealerTrack, Inc., a Delaware
corporation ("Employer") with principal offices at 1111 Marcus Avenue, Suite
M04, Lake Success, NY 11042.

            Section 1. Term

            Employer shall continue to employ Executive and Executive agrees to
continue such employment, upon the terms and conditions hereinafter set forth,
from the Effective Date through and including June 30, 2007 (the "Initial
Term"). This Agreement shall renew automatically for successive one year periods
(each, a "Renewal Term") unless one party gives notice to the other party, in
writing, at least sixty (60) days prior to the expiration of this Agreement (or
any renewal) of its desire to terminate the Agreement. The term of this
Agreement, including the Initial Term and any Renewal Term, shall be referred to
herein as the "Term".

            Section 2. Executive's Duties

            (a) Executive shall be President and shall report directly to
Employer's Chief Executive Officer or his designee. Executive shall faithfully
and diligently perform his duties at the direction of Employer's Chief Executive
Officer, or his designee, to the best of Executive's ability. Executive shall
(i) devote his best efforts, skill, and ability and full business time and
attention to the performance of the services customarily incident to such
office, subject to vacations and sick leave as provided herein and in accordance
with Employer policy, (ii) carry out his duties in a competent and professional
manner; and (iii) generally promote the interests of Employer. Subject to
applicable law, Executive shall not knowingly participate in any activity that
is detrimental to the interests of Employer, DealerTrack Holdings, Inc. (the
"Parent") or any of their affiliates, including, without limitation, any public
criticism or disparagement of any type by Executive, through the media or
otherwise, of Employer or any of its affiliates or employees, except in
connection with the exercise of Executive's rights against Employer or any of
its affiliates.

            (b) Executive agrees to abide by all policies applicable to senior
executive officers of Employer promulgated from time to time by Parent or
Employer, as applicable, which policies are enforced uniformly and applicable to
all similar executives of Employer.

            (c) Except for such business travel as may be incident to his duties
hereunder, Executive shall perform his duties at Employer's offices at the
address set forth in the preamble to this Agreement or at such other location as
may be approved by Employer.

            Section 3. Compensation for Executive's Services

            In consideration of the duties and services to be performed by
Executive pursuant to Sections 1 and 2 hereof, Executive shall receive:

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            (a) Salary. Executive shall earn salary (the "Salary") at the annual
rate of Three Hundred Seventy Thousand Dollars ($370,000.00) (the "Minimum
Salary"), less all applicable federal, state, and local tax withholdings. Such
Salary shall be earned and shall be payable in periodic installments in
accordance with Employer's payroll practices. During the Term, the Board of
Directors of Parent (the "Parent Board") or the Compensation Committee of the
Parent Board (the "Compensation Committee") will review the Salary annually and
may in its discretion increase the Salary, but may not reduce it during the Term
unless Parent institutes salary reductions across the board; provided, however,
that in no event shall the Salary be reduced below the Minimum Salary without
Executive's written consent.

            (b) Bonus. For each fiscal year of Parent (each, a "Fiscal Year"),
Executive shall be entitled to receive a cash performance bonus (a "Bonus")
which shall be based on the achievement of certain performance benchmarks by
Parent and/or Employer during such Fiscal Year which shall be determined by the
Parent Board. The Parent Board shall review the target Bonus on an annual basis
and, in its sole discretion, may increase such target Bonus for any Fiscal Year.
The target Bonus shall not be decreased except in connection with company-wide
bonus reductions. The target Bonus for any Fiscal Year shall be at least
Fifty-Five percent (55%) of the Salary for such Fiscal Year. The Bonus for each
Fiscal Year shall be paid, if at all, to Executive on a schedule consistent with
Employer's bonus payments to its other similarly situated senior executive
officers by no later than two and one half (2 1/2) months following the end of
such Fiscal Year. Executive understands and agrees that the Bonus is established
in part as an inducement for Executive to remain employed by Employer and except
as provided in Section 5(c) of this Agreement, or in the Employer's sole
discretion, in the event that Executive's employment is terminated prior to the
end of any Fiscal Year during the Term, then Executive shall not receive payment
of any Bonus for such year.

            (c) Equity. In connection with Executive's employment, Executive has
been and may continue to be granted stock options ("Stock Options") to purchase
equity securities of Parent pursuant to the terms of DealerTrack Holdings, Inc.
2001 Stock Option Plan, effective as of August 10, 2001, as amended ("Stock
Option Plan") or may be granted Stock Options or other equity based awards
pursuant to the terms of the DealerTrack Holdings, Inc. 2005 Incentive Award
Plan, effective as of May 26, 2005, as amended (the "2005 Incentive Award
Plan"), or any other successor equity incentive plans (collectively, the "Stock
Incentive Plans"). Except as otherwise provided herein, the terms of the Stock
Options shall be governed by the Stock Incentive Plans. Executive shall be
credited with twenty-four (24) months accelerated vesting of his Stock Options
upon termination of Executive's employment by: (1) Employer without Cause (as
defined below); or (2) Executive for Good Reason (as defined below). Executive
shall be credited with thirty-six (36) months accelerated vesting of his Stock
Options upon a Change of Control (defined below). Executive shall be credited
with full acceleration and vesting of his Stock Options upon the earlier of: (1)
the elimination of Executive's position or a termination of Executive's
employment, in either event, within twelve (12) months after a Change of
Control; (2) a material negative change in Executive's compensation or
responsibilities within twelve (12) months after a Change of Control; or (3) the
requirement that Executive be based at a location which is more than fifty (50)
miles from Employer's offices at the address set forth in the preamble to this
Agreement within twelve (12) months after a Change of Control. Anything in the
Stock Incentive Plans to the contrary notwithstanding, if Executive's employment
is terminated by Executive with Good Reason or by Employer without Cause, or
under

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circumstances described above which would result in certain accelerated vesting
of any unvested Stock Options held by Executive, the unexercised portion of any
Stock Options held by Executive will not terminate until the twelve (12) month
anniversary of the date of termination of Executive's employment. In the event
Employer elects to grant equity based awards other than Options, such grants
shall, where appropriate, be subject to equivalent acceleration provisions as
set forth in this Section 3(c). For purposes hereof, a "Change of Control" shall
mean and includes each of the following:

            (i) A transaction or series of transactions (other than an offering
      of shares of Parent to the general public through a registration statement
      filed with the Securities and Exchange Commission) whereby any "person" or
      related "group" of "persons" (as such terms are used in Sections 13(d) and
      14(d)(2) of the Securities Exchange Act of 1934, as amended) (other than
      the Parent, any of its subsidiaries, an employee benefit plan maintained
      by the Parent or any of its subsidiaries or a "person" that, prior to such
      transaction, directly or indirectly controls, is controlled by, or is
      under common control with, the Parent) directly or indirectly acquires
      beneficial ownership (within the meaning of Rule 13d-3 under the
      Securities Exchange Act of 1934, as amended) of securities of the Employer
      or Parent possessing more than 50% of the total combined voting power of
      the Employer's or Parent's securities outstanding immediately after such
      acquisition; or

            (ii) During any period of two consecutive years, individuals who, at
      the beginning of such period, constitute the Parent Board together with
      any new director(s) (other than a director designated by a person who
      shall have entered into an agreement with the Company to effect a
      transaction described in Section 3(c)(i) or Section 3(c)(iii)) whose
      election by the Parent Board or nomination for election by the Parent's
      stockholders was approved by a vote of at least two-thirds of the
      directors then still in office who either were directors at the beginning
      of the two-year period or whose election or nomination for election was
      previously so approved, cease for any reason to constitute a majority
      thereof; or

            (iii) The consummation by the Employer or Parent (whether directly
      involving the Employer or Parent or indirectly involving the Employer or
      Parent through one or more intermediaries) of (x) a merger, consolidation,
      reorganization, or business combination or (y) a sale or other disposition
      of all or substantially all of the Employer's or Parent's assets in any
      single transaction or series of related transactions or (z) the
      acquisition of assets or stock of another entity, in each case other than
      a transaction:

                  (A) Which results in the Employer's or Parent's voting
      securities outstanding immediately before the transaction continuing to
      represent (either by remaining outstanding or by being converted into
      voting securities of the Employer or Parent or the person that, as a
      result of the transaction, controls, directly or indirectly, the Employer
      or Parent or owns, directly or indirectly, all or substantially all of the
      Employer's or Parent's assets or otherwise succeeds to the business of the
      Employer or Parent (the Employer or Parent or such person, the "Successor
      Entity")) directly or indirectly, at least a majority of the combined
      voting power of the Successor Entity's outstanding voting securities
      immediately after the transaction, and

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                  (B) After which no person or group beneficially owns voting
      securities representing 50% or more of the combined voting power of the
      Successor Entity; provided, however, that no person or group shall be
      treated for purposes of this Section 3(c)(iii) as beneficially owning 50%
      or more of combined voting power of the Successor Entity solely as a
      result of the voting power held in the Employer or Parent prior to the
      consummation of the transaction; or

            (iv) The Employer's or Parent's stockholders approve a liquidation
      or dissolution of the Employer or Parent.

The Parent Board or its designee shall have full and final authority, which
shall be exercised in its discretion, to determine conclusively whether a Change
of Control of the Employer or Parent has occurred, and the date of the
occurrence of such Change of Control and any incidental matters relating
thereto.

            (d) Benefits. Employer shall provide Executive with the right to
participate in and receive benefits from all life, accident, disability, medical
and pension plans, and all similar benefits as are from time to time in effect
and are generally made available to similar situated senior executive officers
of Employer. The amount and extent of benefits to which Executive is entitled
shall be governed by the specific benefit plan, as it may be amended from time
to time.

            (e) Expenses. Employer shall promptly reimburse Executive for
reasonable expenses for cellular telephone usage, entertainment, travel, meals,
lodging and similar items incurred in the conduct of Employer's business. Such
expenses shall be reimbursed in accordance with Employer's expense reimbursement
policies and guidelines.

            (f) Vacation; Sick Leave. During the Term, Executive shall be
entitled to four weeks (4) weeks vacation per year, paid holidays, sick leave,
and similar benefits, to be earned and used in accordance with Employer's policy
and procedure for other similarly situated senior executive officers.

            (g) Modification. Employer reserves the right to modify, suspend or
discontinue any and all of the above plans, practices, policies and programs
referenced in Sections 3(d) and (e) at any time in its discretion without
recourse by Executive so long as such action is taken generally with respect to
other similarly situated senior executive officers. Any such modification,
suspension or discontinuance of the plans, practices and policies referenced in
Section 3(e) will not apply to otherwise reimbursable expenses incurred by
Executive prior to any such modification, suspension or discontinuance.

            Section 4. Termination of Employment

            (a) Resignation. Executive may voluntarily terminate his employment
with Employer, at any time, with or without Good Reason, upon written notice to
Employer.

            (b) Termination. Employer may terminate Executive's employment at
any time, with or without Cause, upon written notice to Executive.

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            (c) Death or Disability. Executive's employment shall terminate
immediately upon Executive's death. In the event Employer, in good faith,
determines that Executive is unable to perform the functions of his position due
to a Disability (as defined below), it may notify Executive in writing of its
intention to terminate Executive's employment and Executive's employment with
Employer shall terminate effective on the thirtieth (30th) day after receipt of
such notice by Executive. For the purposes of this Agreement, "Disability" shall
mean a physical or mental impairment that substantially limits a major life
activity of Executive and renders Executive unable to perform the essential
functions of his position even with reasonable accommodation (that does not
impose an undue hardship on Employer), and which has lasted at least (i) sixty
(60) consecutive days, (ii) the balance of Executive's entitlement to leave, if
any, under the Family and Medical Leave Act, or other similar statute or (iii)
the balance of any election period under the Employer's long term disability
program (without regard to whether Executive is awarded benefits under such
program), whichever is longer.

            (d) Cause. Employer may immediately terminate Executive's employment
for "Cause" by giving written notice to Executive. For purposes of this
Agreement, "Cause" shall mean:

                  (1)   Executive's commission of an act of fraud or
                        embezzlement upon Employer or any of its affiliates; or

                  (2)   Executive's commission of any willful act intended to
                        injure the reputation, business, or any business
                        relationship of Employer or any of its affiliates; or

                  (3)   Executive is found by a court of competent jurisdiction
                        to have committed a felony; or

                  (4)   the refusal or failure of Executive to perform
                        Executive's duties with Employer in a competent and
                        professional manner that is not cured by Executive
                        within ten (10) business days after a written demand
                        therefor is delivered to Executive by the Board of
                        Directors of Employer ("Board") which specifically
                        identifies the manner in which the Board believes that
                        Executive has not substantially performed Executive's
                        duties; provided, further, however, that if the Board,
                        in good faith, determines that the refusal or failure by
                        Executive is egregious in nature or is not susceptible
                        of cure, then no cure period shall be required
                        hereunder; or

                  (5)   the refusal or failure of Executive to comply with any
                        of his material obligations under this Agreement
                        (including any exhibit hereto) that is not cured by
                        Executive within ten (10) business days after a written
                        demand therefor is delivered to Executive by the Board
                        which specifically identifies the manner in which the
                        Board believes Executive has materially breached this
                        Agreement; provided, further, however, that if the
                        Board, in good faith,

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                            determines that the refusal or failure by Executive
                            is egregious in nature or is not susceptible of
                            cure, then no cure period shall be required
                            hereunder.

                  (e)   Good Reason. Executive may terminate his employment for
"Good Reason," by delivering written notice of such termination ("Employer
Default Notice") to Employer within sixty (60) days of the occurrence of any of
the following events, each of which shall constitute Good Reason: (i) Employer's
material breach of any provision of this Agreement, the Stock Incentive Plans or
any agreements thereunder, which has not been cured within the allotted time;
(ii) a material reduction of Executive's then current title, status, authority,
responsibility or duties or the assignment to Executive of any duties materially
inconsistent with Executive's then current position; (iii) any material
reduction in Executive's salary or benefits; (iv) the failure of any successor
entity to assume the terms of this Agreement upon any Change of Control; (v) the
relocation of Executive to a facility or location more than fifty (50) miles
from Employer's principal offices at the address set forth in the preamble to
this Agreement; or (vi) the failure of Employer to renew this Agreement upon the
expiration of the Initial Term or any Renewal Term. The Employer Default Notice
shall specify the reason for Executive's belief that an event constituting Good
Reason has occurred. Notwithstanding the foregoing, any material breach of this
Agreement by Employer, or other event constituting Good Reason, shall not
constitute Good Reason if any such breach or other event is cured or corrected
by Employer within thirty (30) days following delivery to Employer of the
Employer Default Notice.

            (f) Continuing Obligations. Executive acknowledges and agrees that
any termination under this Section 4 is not intended, and shall not be deemed or
construed, to affect in any way any of Executive's covenants and obligations
contained in Sections 6, 7, and 8 hereof, which shall continue in full force and
effect beyond such termination for any reason.

            Section 5. Termination Obligations

            (a) Resignation. If Executive's employment is terminated voluntarily
by Executive without Good Reason, Executive's employment shall terminate without
further obligations to Executive other than for payment of the sum of any unpaid
Salary determined by the Parent Board and reimbursable expenses and vacation
accrued and owing to Executive prior to the termination. The sum of such amounts
shall hereinafter be referred to as the "Accrued Obligations," which shall be
paid to Executive or Executive's estate or beneficiary within thirty (30) days
of the date of termination. If Executive voluntarily terminates his employment
without Good Reason and within (30) days of such termination, Employer
determines that it would have had Cause to terminate Executive pursuant to
Section 4(d), Executive shall be deemed to have been terminated for Cause and
the terms of Section 5(b) shall apply.

            (b) Cause. If Executive's employment is terminated by Employer for
Cause, this Agreement shall terminate without further obligations to Executive
other than for the timely payment of Accrued Obligations. If it is subsequently
determined by an arbitrator, pursuant to Section 19 hereof, that Employer did
not have Cause for termination, then Employer's decision to terminate shall be
deemed to have been made without Cause and the terms of Section 5(c) shall
apply.

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            (c) By Employer Other than for Cause or Death or Disability; By
Executive for Good Reason.

                  (1) If (A) Employer terminates Executive's employment for a
reason other than Cause, or due to Executive's death or Disability, or (B)
Executive terminates his employment for Good Reason, Employer shall have no
further obligations to Executive other than for (i) the payment of Accrued
Obligations, (ii) severance pay in an amount equal to twenty-four (24) months of
Salary to be paid in equal installments in accordance with Employer's payroll
practices during the period beginning on the Severance Commencement Date (as
defined below) and ending on the 24-month anniversary of the date of the
Executive's termination of employment (the "Date of Termination"); provided,
however, that, notwithstanding the foregoing, if the Severance Commencement Date
is the six-month anniversary of the Date of Termination, then Employer shall, as
of the six-month anniversary of the Date of Termination, pay to the Executive a
lump-sum amount equal to 25% of the Severance Amount (with the other 75% of the
Severance Amount payable to the Executive in equal monthly installments during
the period beginning on the six-month anniversary of the Date of Termination and
ending on the 24-month anniversary thereof), and (iii) a pro rata bonus
calculated based on multiplying the percentage of the year Executive worked for
Employer during the year of his termination by the Bonus received by Executive
during the preceding year and (iv) the reimbursement of premiums otherwise
payable by Executive pursuant to COBRA for a period of up to 12 months, or until
Executive no longer is eligible for COBRA continuation coverage, whichever is
earlier. For purposes of this Section 5, "Severance Commencement Date" shall
mean (x) if any stock of Parent or its affiliates is publicly traded on an
established securities market or otherwise and the Parent Board (or its
delegate) determines in its discretion that as of the Date of Termination the
Executive is a "key employee" (within the meaning of Section 416(i) of the
Internal Revenue Code of 1986, as amended (the "Code")), as interpreted in
accordance with Section 409A of the Code and Department of Treasury regulations
and other interpretive guidance issued thereunder) and that Section 409A of the
Code applies with respect to a payment to the Executive pursuant to Section
5(c)(1)(ii), the six-month anniversary of the Date of Termination; or (y) if the
Parent Board (or its delegate) determines in its discretion that the Executive
is not such a "key employee" as of the Date of Termination (or that Section 409A
of the Internal Revenue Code does not apply with respect to a payment to the
Executive pursuant to Section 5(c)(1)(ii)), the Date of Termination. The
payments described in this Section 5(c)(1), except for those set forth in
Section 5(c)(1)(ii) and (iv), shall be made within thirty (30) days of the Date
of Termination.

                  (2) If Executive terminates his employment for Good Reason and
it is subsequently determined by an arbitrator, pursuant to Section 20 hereof,
that Executive did not have Good Reason for termination, then Executive's
decision to terminate for Good Reason shall be deemed to have been a voluntary
resignation, the terms of Section 5(a) shall apply, and all monies paid to
Executive pursuant to this Section 5(c)(1), except for those monies paid
pursuant to Section 5(c)(1)(i), shall be immediately returned to Employer.

                  (3) The amounts payable pursuant to Section 5(c)(1) shall be
the only amounts Executive shall receive for termination in accordance with this
Section 5(c); provided, however, that no amounts shall be payable pursuant to
this section 5(c) on or following the date Executive breaches any of Sections 7,
8 or 9 of this Agreement.

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            (d) Mitigation. In the event Executive's employment with Employer is
terminated pursuant to this Section 5, Executive shall be obligated to mitigate
any severance payments due to Executive in accordance with Section 5(c)(1)(ii).
Executive shall be required to notify Employer, in writing, within seven (7)
days of obtaining subsequent employment by an unrelated party, which shall
include, without limitation, self-employment, consulting or other arrangement,
but not passive investment activities. In the event Executive obtains other
employment during any severance payout period described in Section 5(c)(1)(ii),
the severance payments due to Executive thereunder shall be reduced to an amount
equal to the lesser of (i) fifty (50%) percent of Executive's Salary immediately
prior to the Date of Termination or (ii) fifty (50%) percent of Executive's base
compensation received for subsequent employment, self-employment, consulting or
other arrangement, commencing on the date Executive commences providing services
in his new capacity. Nothing herein shall require Executive to seek employment,
self-employment, consulting or other arrangement.

            (e) Release. Notwithstanding anything to the contrary contained
herein, no severance payments required hereunder shall be made by Employer until
such time as Executive shall execute a general release for the benefit of
Employer and its affiliates in a form satisfactory to Employer. Such general
release shall not apply to (i) Executive's rights under any Stock Incentive Plan
award agreements or (ii) Executive's rights, as applicable, to indemnification
under Employer's or Parent's charter or bylaws, any indemnification agreement or
applicable law.

            (f) Equity Compensation Awards. Except as expressly provided herein,
except for the provisions of Section 3(c) of this Agreement, the terms of the
Stock Incentive Plans and any related award agreements and/or notice of grant
shall govern the termination, vesting, and/or exercise of Executive's stock
options or other equity awards upon the termination of Executive's employment
for any reason.

            (g) Exclusive Remedy. Executive agrees that the payments set forth
in this Agreement shall constitute the exclusive and sole remedy for any
termination of Executive's employment and Executive covenants not to assert or
pursue any other remedies, at law or in equity, with respect to this Agreement.

            (h) Termination of Executive's Office. Following the termination of
Executive's employment for any reason, Executive shall hold no further office or
position with Employer or any of its affiliates.

            Section 6. Parachute Payments.

            (a) If it is determined by a nationally recognized United States
public accounting firm selected by the Employer and approved in writing by the
Executive (which approval shall not be unreasonably withheld) (the "Auditors")
that any payment or benefit made or provided to the Executive in connection with
this Agreement or otherwise (including without limitation any Stock Option or
other equity based award vesting) (collectively, a "Payment"), would be subject
to the excise tax imposed by Section 4999 of the Code (the "Parachute Tax"),
then the Employer shall pay to the Executive, prior to the time the Parachute
Tax is payable with respect to such Payment, an additional payment (a "Gross-Up
Payment") in an amount such that,

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after payment by the Executive of all taxes (including any Parachute Tax)
imposed upon the Gross-Up Payment, the Executive retains an amount of the
Gross-Up Payment equal to the Parachute Tax imposed upon the Payment. The amount
of any Gross-Up Payment shall be determined by the Auditors, subject to
adjustment, as necessary, as a result of any Internal Revenue Service position.
For purposes of making the calculations required by this Agreement, the Auditors
may make reasonable assumptions and approximations concerning applicable taxes
and may rely on reasonable, good faith interpretations concerning the
application of Sections 280G and 4999 of the Code, provided that the Auditors'
determinations must be made with substantial authority (within the meaning of
Section 6662 of the Code).

            (b) The federal tax returns filed by the Executive (and any filing
made by a consolidated tax group which includes the Employer) shall be prepared
and filed on a basis consistent with the determination of the Auditors with
respect to the Parachute Tax payable by the Executive. The Executive shall make
proper payment of the amount of any Parachute Tax, and at the request of the
Employer, provide to the Employer true and correct copies (with any amendments)
of his federal income tax return as filed with the Internal Revenue Service, and
such other documents reasonably requested by the Employer, evidencing such
payment. If, after the Employer's payment to the Executive of the Gross-Up
Payment, the Auditors determine in good faith that the amount of the Gross-Up
Payment should be reduced or increased, or such determination is made by the
Internal Revenue Service, then within ten (10) business days of such
determination, the Executive shall pay to the Employer the amount of any such
reduction, or the Employer shall pay to the Executive the amount of any such
increase; provided, however, that in no event shall the Executive have any such
refund obligation if it is determined by the Employer that to do so would be a
violation of the Sarbanes-Oxley Act of 2002, as it may be amended from time to
time; and provided, further, that if the Executive has prior thereto paid such
amounts to the Internal Revenue Service, such refund shall be due only to the
extent that a refund of such amount is received by the Executive; and provided,
further, that (i) the fees and expenses of the Auditors (and any other legal and
accounting fees) incurred for services rendered in connection with the Auditor's
determination of the Parachute Tax or any challenge by the Internal Revenue
Service or other taxing authority relating to such determination shall be paid
by the Employer and (ii) the Employer shall indemnify and hold the Executive
harmless on an after-tax basis for any interest and penalties imposed upon the
Executive to the extent that such interest and penalties are related to the
Auditor's determination of the Parachute Tax or the Gross-Up Payment.
Notwithstanding anything to the contrary herein, the Executive's rights under
this Section 6 shall survive the termination of his employment for any reason
and the termination or expiration of this Agreement for any reason.

            Section 7. Restrictions Respecting Confidential Information

            Executive hereby covenants and agrees that, during his employment
and thereafter, Executive will not, under any circumstance, disclose in any way
any Confidential Information (as defined below) to any other person other than
(i) at the direction of and for the benefit of Employer, (ii) to his attorney or
other advisers in connection with Executive's enforcement of his rights
hereunder, provided such individuals or entities agree to be bound by the
confidentiality restrictions herein contained, and if such Confidential
Information is relevant to such enforcement action, to the court or arbitrator,
as applicable, subject to a protective order. For the purposes of the foregoing,
"Confidential Information" means any information pertaining

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to the assets, business, creditors, vendors, manufacturers, customers, data,
employees, financial condition or affairs, formulae, licenses, methods,
operations, procedures, reports, suppliers, systems and technologies of Employer
and its affiliates, including (without limitation) the contracts, patents, trade
secrets and customer lists developed or otherwise acquired by Employer and its
affiliates; provided, however, that Confidential Information shall exclude any
information that was, is, or becomes publicly available other than through
disclosure by Executive or any other person known to Executive to be subject to
confidentiality obligations to Employer. All Confidential Information is and
will remain the sole and exclusive property of Employer and its affiliates.
Following the termination of his employment, Executive shall return all
documents and other tangible items containing Confidential Information to
Employer, without retaining any copies, notes or excerpts thereof.

            Section 8. Proprietary Matters

            Executive expressly understands and agrees that any and all
improvements, inventions, discoveries, processes, or know-how that are generated
or conceived by Executive during the Term (collectively, the "Inventions") will
be the sole and exclusive property of Employer, and Executive will, whenever
requested to do so by Employer (either during the Term or thereafter), execute
and assign any and all applications, assignments and/or other instruments and do
all things which Employer may deem necessary or appropriate in order to apply
for, obtain, maintain, enforce and defend patents, copyrights, trade names or
trademarks of the United States or of foreign countries for said Inventions, or
in order to assign and convey or otherwise make available to Employer the sole
and exclusive right, title, and interest in and to said Inventions,
applications, patents, copyrights, trade names or trademarks; provided, however,
that the provisions of this Section 8 shall not apply to an Invention that
Executive developed entirely on his own time without using Employer's
Confidential Information except for those Inventions that either (i) directly
and materially relate, at the time of conception or reduction to practice of the
invention, to Employer's business, or actual or demonstrably anticipated
research or development of Employer, or (ii) directly and materially result from
any work performed by Executive for Employer. Executive shall promptly
communicate and disclose to Employer all Inventions conceived, developed or made
by him during his employment by Employer, whether solely or jointly with others,
and whether or not patentable or copyrightable, (a) which relate to any matters
or business of the type carried on or being developed by Employer, or (b) which
result from or are suggested by any work done by him in the course of his
employment by Employer. Executive shall also promptly communicate and disclose
to Employer all material other data obtained by him concerning the business or
affairs of Employer in the course of his employment by Employer.

            Section 9. Nonsolicitation/Non-Compete

            (a) Executive agrees that throughout his employment and for a period
of two (2) years following the termination of his employment for any reason, he
will not directly or indirectly, own, manage, operate, control, or participate
in the ownership, management, operation, or control of, or be connected with, or
have any financial interest in, any Competitor. Ownership, for personal
investment purposes only, of not to exceed (i) individually, two (2%) percent of
the outstanding capital stock of any privately held entity, or (ii) voting stock
of any publicly held corporation shall not constitute a violation hereof. For
purposes of this Agreement,

                                       10
<PAGE>

the term "Competitor" shall mean any individual or entity, present or future,
then providing any of the following products or services: (1) a multi-finance
source automotive finance portal, (2) electronic contracting for automotive
finance or lease transactions, other than at a financing source entity that
purchases electronic contracts or leases from automotive dealers, (3) automotive
lease, retail and/or balloon payment comparison or desking tools or (4) any
other sales or finance and insurance-related products or services for automotive
dealerships similar to any products or services offered by Employer or any of
its affiliates.

            (b) Executive agrees that during his employment with Employer and
for a period of two (2) years following the termination of his employment for
any reason, he will not actively solicit for employment, consulting or any other
arrangement any employee of Employer or any of its present or future affiliates
(while an affiliate).

            (c) Executive agrees that during his employment with Employer and
for a period of two (2) years following the termination of his employment for
any reason, he will not influence or attempt to influence customers of Employer
or any of its present or future affiliates, either directly or indirectly, to
divert their business to any Competitor.

            (d) The restrictions contained in this Section 9 are necessary for
the protection of the business and goodwill of Employer and are considered by
Executive to be reasonable for such purpose. Further, Executive represents that
these restrictions will not prevent him from earning a livelihood during the
restricted period.

            (e) This Section 9 shall survive the termination or expiration of
this Agreement.

            Section 10. Equitable Relief

            Executive acknowledges and agrees that Employer will suffer
irreparable damage which cannot be adequately compensated by money damages in
the event of a breach, or threatened breach, of any of the terms and provisions
of Sections 7, 8 and 9 of this Agreement, and that, in the event of any such
breach, or threatened breach, Employer will not have an adequate remedy at law.
It is therefore agreed that Employer, in addition to all other such rights,
powers, privileges and remedies that it may have, shall be entitled to
injunctive relief, specific performance or such other equitable relief as
Employer may request to enforce any of those terms and provisions and to enjoin
or otherwise restrain any act prohibited thereby, and Executive will not raise
and hereby waives any objection or defense that there is an adequate remedy
available at law. Notwithstanding the provisions of Section 20 of this
Agreement, Executive agrees that Employer shall be entitled to seek such
injunctive relief, without bond, in a court of competent jurisdiction and
Executive hereby consents to the jurisdiction of the state and federal courts of
New York for purposes of such an action. Executive agrees that any claim he may
have against Employer or any of its affiliates shall not constitute a defense
against the issuance of any such equitable relief. The foregoing shall not
constitute a waiver of any of Employer's rights, powers, privileges and remedies
against or in respect of a breaching party or any other person or thing under
this Agreement, or applicable law.

                                       11
<PAGE>

            Section 11. Notice

            Any notice, request, demand or other communication hereunder shall
be in writing, shall be delivered by hand or sent by registered or certified
mail or by reputable overnight delivery service, postage prepaid, to the
addressee at the address set forth below (or at such other address as shall be
designated hereunder by written notice to the other party hereto) and shall be
deemed conclusively to have been given when actually received by the addressee.

            All notices and other communications hereunder shall be addressed as
follows:

                   If to Executive at the address set forth in the
                   Employer's payroll records.

                   If to Employer:

                   DealerTrack Holdings, Inc.
                   1111 Marcus Avenue, Suite M04
                   Lake Success, NY 11042

                   With a copy to:

                   General Counsel
                   DealerTrack Holdings, Inc.
                   1111 Marcus Avenue, Suite M04
                   Lake Success, NY 11042

                   and to:

                   Latham & Watkins LLP
                   885 Third Avenue
                   New York, NY  10022
                   Attention: Bradd L. Williamson, Esq.

or to such other address as either party shall have furnished to the other in
writing in accordance herewith.

            Section 12. Legal Counsel

            In entering into this Agreement, the parties represent that they
have relied upon the advice of their attorneys, who are attorneys of their own
choice, and that the terms of this Agreement have been completely read and
explained to them by their attorneys, and that those terms are fully understood
and voluntarily accepted by them.

            Section 13. Section and Other Headings

            The section and other headings contained in this Agreement are for
reference purposes only and shall not affect the meaning or interpretation of
this Agreement.

                                       12
<PAGE>

            Section 14. Governing Law

            This Agreement has been executed and delivered, and shall be
governed by and construed in accordance with the applicable laws pertaining, in
the State of New York, without regard to conflicts of laws principles.

            Section 15. Severability

            In the event that any term or provision of this Agreement shall be
finally determined to be superseded, invalid, illegal or otherwise unenforceable
pursuant to applicable law by a governmental authority having jurisdiction and
venue, that determination shall not impair or otherwise affect the validity,
legality or enforceability, to the maximum extent permissible by law, (a) by or
before that authority of the remaining terms and provisions of this Agreement,
which shall be enforced as if the unenforceable term or provision were deleted,
or (b) by or before any other authority of any of the terms and provisions of
this Agreement.

            Section 16. Counterparts

            This Agreement may be executed in two counterpart copies of the
entire document or of signature pages to the document, each of which may be
executed by one of the parties hereto, but all of which, when taken together,
shall constitute a single agreement binding upon both of the parties hereto.

            Section 17. Benefit

            This Agreement shall be binding upon and inure to the benefit of the
respective parties hereto and their legal representatives, successors and
assigns. Insofar as Executive is concerned, this Agreement, being personal,
cannot be assigned; provided, however, that should Executive become entitled to
payment pursuant to Section 5 hereof, he may assign his rights to such payment
to his legal representatives, successors, and assigns. Without limiting the
generality of the foregoing, all representations, warranties, covenants and
other agreements made by or on behalf of Executive in this Agreement shall inure
to the benefit of the successors and assigns of Employer.

            Section 18. Modification

            This Agreement may not be amended or modified other than by a
written agreement executed by all parties hereto.

            Section 19. Entire Agreement

            Except as provided in Section 5(f) hereof, this Agreement contains
the entire agreement of the parties and supersedes all other representations,
warranties, agreements and understandings, oral or otherwise, among the parties
with respect to the matters contained herein, including any prior employment
agreements between Executive and Employer or any affiliate of Employer.

                                       13
<PAGE>

            Section 20. Arbitration

            (a) Executive agrees that any dispute or controversy arising out of,
relating to, or in connection with this Agreement or the termination thereof, or
the interpretation, validity, construction, performance, breach, or termination
thereof, shall be settled by expedited, binding arbitration to be held in New
York, New York in accordance with the National Rules for the Resolution of
Employment Disputes then in effect of the American Arbitration Association (the
"Rules"). The arbitrator may grant injunctions or other relief in such dispute
or controversy. The decision of the arbitrator shall be final, conclusive and
binding on the parties to the arbitration. Judgment may be entered on the
arbitrator's decision in any court having jurisdiction. The arbitrator may award
the prevailing party its reasonable attorney's fees.

            (b) The arbitrator shall apply New York law to the merits of any
dispute or claim, without reference to rules of conflicts of law. The
arbitration proceedings shall be governed by federal arbitration law and by the
Rules, without reference to state arbitration law.

            (c) EXECUTIVE HAS READ AND UNDERSTANDS THIS SECTION, WHICH DISCUSSES
ARBITRATION. EXECUTIVE UNDERSTANDS THAT BY SIGNING THIS AGREEMENT, EXECUTIVE IS
AGREEING TO SUBMIT ANY CLAIMS ARISING OUT OF, RELATING TO, OR IN CONNECTION WITH
THIS AGREEMENT, OR THE INTERPRETATION, VALIDITY, CONSTRUCTION, PERFORMANCE,
BREACH OF TERMINATION THEREOF, TO BINDING ARBITRATION, AND THAT THIS ARBITRATION
CLAUSE CONSTITUTES A WAIVER OF EXECUTIVE'S RIGHT TO A JURY TRIAL AND RELATES TO
THE RESOLUTION OF ALL DISPUTES RELATING TO ALL ASPECTS OF THE EMPLOYER/EMPLOYEE
RELATIONSHIP INCLUDING, BUT NOT LIMITED TO, STATUTORY DISCRIMINATION CLAIMS.

            Section 21. Representations and Warranties of Executive

            In order to induce Employer to enter into this Agreement, Executive
represents and warrants to Employer, to the best of his knowledge after the
review of his personnel files, that: (a) the execution and delivery of this
Agreement by Executive and the performance of his obligations hereunder will not
violate or be in conflict with any fiduciary or other duty, instrument,
agreement, document, arrangement or other understanding to which Executive is a
party or by which he is or may be bound or subject; and (b) Executive is not a
party to any instrument, agreement, document, arrangement or other understanding
with any person (other than Employer) requiring or restricting the use or
disclosure of any confidential information or the provision of any employment,
consulting or other services.

            Section 22. Waiver of Breach

            Except as may specifically provided herein, the failure of a party
to insist on strict adherence to any term of this Agreement on any occasion
shall not be considered a waiver or deprive that party of the right thereafter
to insist upon strict adherence to that term or any term of this Agreement. Any
waiver hereto must be in writing.

                                       14
<PAGE>

            Section 23. Section 409A. The parties acknowledge and agree that, to
the extent applicable, this Agreement shall be interpreted in accordance with
Section 409A of the Code and Department of Treasury regulations and other
interpretive guidance issued thereunder, including without limitation any such
regulations or other guidance that may be issued after the Effective Date.
Notwithstanding any provision of this Agreement to the contrary, in the event
that Employer determines that any amounts payable hereunder will be immediately
taxable to the Executive under Section 409A of the Code and related Department
of Treasury guidance, Employer may (a) adopt such amendments to this Agreement
and appropriate policies and procedures, including amendments and policies with
retroactive effect, that Employer determines necessary or appropriate to
preserve the intended tax treatment of the benefits provided by this Agreement
and/or (b) take such other actions as Employer determines necessary or
appropriate to comply with the requirements of Section 409A of the Code and
related Department of Treasury guidance, including such Department of Treasury
guidance and other interpretive materials as may be issued after the Effective
Date.

                            [signature page follows]

                                       15
<PAGE>

            IN WITNESS WHEREOF, the parties hereto have executed and delivered
this Agreement as of the date first written above.

                                    EXECUTIVE:

                                    __________________________________________
                                    Vincent Passione

                                    EMPLOYER:

                                    DEALERTRACK, INC.

                                    By: ______________________________________

                                    Name: Mark F. O'Neil

                                    Title: Chairman and Chief Executive Officer

                                       16<PAGE>

                                                                   EXHIBIT 10.20

                           DEALERTRACK HOLDINGS, INC.

                             2001 STOCK OPTION PLAN

            (As Adopted by the Board of Directors on August 10, 2001
              and Approved by the Stockholders on August 10, 2001)

      1. PURPOSE OF THIS PLAN.

            The purpose of this DEALERTRACK HOLDINGS, INC. 2001 STOCK OPTION
PLAN (the "Plan") is (a) to further the growth and success of DEALERTRACK
HOLDINGS, INC., a Delaware corporation (the "Company"), by enabling directors,
officers and employees of, advisors to, and independent consultants or
independent contractors to, the Company or its Subsidiaries to acquire shares of
the Common Stock, par value $.01 per share, of the Company (the "Common Stock"),
thereby increasing their personal interest in such growth and success, and (b)
to provide a means of rewarding outstanding performance by such persons to the
Company and its Subsidiaries. Options granted under this Plan may be either
"incentive stock options" ("ISOs"), intended to qualify as such under the
provisions of Section 422 of the Internal Revenue Code of 1986, as amended (the
"Code"), or non-qualified stock options ("NSOs"). Unless the context otherwise
requires, any ISO or NSO shall hereinafter be referred to as an "Option." For
purposes of this Plan, the term "Subsidiary" means "Subsidiary Corporation" as
defined in Section 424(f) of the Code.

      2. ADMINISTRATION OF THIS PLAN.

            (a) COMPENSATION COMMITTEE. This Plan shall be administered by the
Board of Directors of the Company (the "Board") or the Compensation Committee of
the Board (the "Committee") consisting of such number of persons appointed to
such Committee from time to time by the Board; provided, however, that following
the date on which Common Stock is registered under the Securities and Exchange
Act of 1934, as amended (the "1934 Act"), in order to permit officers and
directors of the Company to be exempt from the provisions of Section 16(b) of
the 1934 Act with respect to transactions pursuant to this Plan, each person
appointed to the Committee, at the effective date of his or her appointment to
the Committee, shall, to the extent such a person exists, be a "Non-Employee
Director" within the meaning of Rule 16b-3 ("Rule 16b-3") promulgated by the
Securities and Exchange Commission (the "SEC") under the 1934 Act. The members
of the Committee may be removed at any time either with or without cause by the
Board. Any vacancy on the Committee, whether due to action of the Board or any
other cause, shall be filled by the Board. The term "Committee" shall, for all
purposes of this Plan, other than this Section 2, be deemed to refer to the
Board if the Board is administering this Plan.

            (b) PROCEDURES. If this Plan is administered by the Committee, the
Committee shall from time to time select a Chairman from among the members of
the Committee. The Committee shall adopt such rules and regulations as it shall
deem appropriate concerning the holding of meetings and the administration of
this Plan. A majority of the entire Committee shall constitute a quorum and the
actions of a majority of the members of the Committee present at a meeting at
which a quorum is present, or actions approved in writing by

                                      -1-
<PAGE>

all of the members of the Committee (but only to the extent permitted by
applicable law and the applicable rules and regulations of the principal
national securities exchange or national market system (if any) on which the
Common Stock is a class of securities then listed or admitted for trading),
shall be the actions of the Committee; provided, however, that if the Committee
consists of only two members, both shall be required to constitute a quorum and
to act at a meeting or to approve actions in writing.

            (c) INTERPRETATION. Except as otherwise expressly provided in this
Plan, the Committee shall have all powers with respect to the administration of
this Plan, including, without limitation, full power and authority to (i)
interpret the provisions of this Plan, any Option Agreement (as defined in
Section 5(b)) and any other agreement or document executed pursuant to this
Plan, (ii) resolve all questions arising under this Plan, any Option Agreement
and any other such agreement or plan, (iii) correct any defect, supply any
omission or reconcile any inconsistency in or among the Plan, any Option or any
Option Agreement, (iv) grant waivers of Plan or Option conditions and (v) make
all other determinations necessary or advisable for the administration of this
Plan. All decisions of the Board or the Committee, as the case may be, shall be
conclusive and binding on all participants in this Plan.

      3. SHARES OF STOCK SUBJECT TO THE PLAN.

            (a) NUMBER OF AVAILABLE SHARES. Subject to the provisions of Section
9 (relating to adjustments upon changes in capital structure and other corporate
transactions) and the further provisions of this Section 3(a), the number of
shares of Common Stock available at any one time for issuance upon the exercise
of Options granted under this Plan shall not exceed 8,510,455 shares of Common
Stock (before making any adjustment under this Plan or otherwise for any stock
split, stock dividend or similar recapitalization event occurring on or after
the Effective Date (as defined in Section 11)). If, and to the extent that, (i)
Options granted under this Plan terminate, expire or are canceled without having
been fully exercised, new Options may be granted under this Plan for the shares
of Common Stock constituting the unexercised portion of such terminated, expired
or canceled Options, and (ii) any shares of Common Stock issued upon the
exercise of Options granted under this Plan are forfeited to or repurchased by
the Company, new Options may be granted under this Plan for up to an equivalent
number of shares of Common Stock (but, in the case of any such repurchased
share, only if such share is repurchased for consideration not greater than the
purchase price for such share specified in the applicable Option).

            (b) CHARACTER OF SHARES. The shares of Common Stock issuable upon
the exercise of an Option granted under this Plan shall be (i) authorized but
unissued shares of Common Stock, (ii) shares of Common Stock held in the
Company's treasury or (iii) a combination of the foregoing.

            (c) RESERVATION OF SHARES. The number of shares of Common Stock
reserved for issuance under this Plan shall at no time be less than the maximum
number of shares of Common Stock which may be purchased at any time pursuant to
outstanding Options.

                                      -2-
<PAGE>

      4. ELIGIBILITY.

            (a) GENERAL. Options may be granted under this Plan only to persons
who are directors, officers or employees of, advisors to, or independent
consultants or independent contractors to, the Company or its Subsidiaries.
Options granted to employees (including officers or directors who are employees)
of the Company or any of its Subsidiaries shall be, in the discretion of the
Committee, either ISOs or NSOs, and Options granted to directors or officers of,
advisors to, or independent consultants or independent contractors to, the
Company or any of its Subsidiaries who are not employees of the Company or any
of its Subsidiaries shall be NSOs. Persons who are not employees of the Company
or any of its Subsidiaries shall be ineligible for grants of ISOs.

            (b) EXCEPTIONS. Anything contained in Section 4(a) to the contrary
notwithstanding, no Option may be granted under this Plan to any employee who
owns, directly or indirectly (within the meaning of Sections 422(b)(6) and
424(d) of the Code), stock possessing more than 10% of the total combined voting
power of all classes of stock of the Company or any of its Subsidiaries (a "10%
Stockholder"), unless (i) the Option Price (as defined in Section 6(a)) of the
shares of Common Stock subject to such Option is fixed at not less than 110% of
the Fair Market Value (as determined in accordance with Section 6(b)) on the
date of grant of such Option and (ii) if the Option is intended to be an ISO,
such Option by its terms is not exercisable after the expiration of five years
from the date it is granted.

      5. GRANT OF OPTIONS.

            (a) GENERAL. Options may be granted under this Plan at any time and
from time to time on or prior to the tenth anniversary of the Effective Date.
Subject to the provisions of this Plan, the Committee shall have plenary
authority and discretion, to determine:

                  (i) the persons (from among the classes of persons eligible to
      receive Options under this Plan) to whom Options shall be granted (the
      "Optionees");

                  (ii) the form and terms of Options;

                  (iii) whether Options will be granted singly, in combination
      with, in tandem with, in replacement of, or as alternatives to, other
      Options under this Plan or any other incentive or compensation plan of the
      Company or any Subsidiary of the Company;

                  (iv) the time or times at which Options shall be granted;

                  (v) the number of shares of Common Stock subject to each
      Option;

                  (vi) the Option Price of the shares of Common Stock subject to
      each Option; and

                                      -3-
<PAGE>

                  (vii) the time or times after grant when each Option and the
      shares of Common Stock covered thereby shall become vested and/or
      exercisable and the duration of the exercise and/or vesting periods.

            (b) OPTION AGREEMENTS. Each Option granted under this Plan shall be
designated by the Committee as an ISO or an NSO and shall be subject to the
terms and conditions applicable to ISOs and/or NSOs (as the case may be) set
forth in this Plan. In addition, each Option shall be evidenced by a written
agreement (each, an "Option Agreement"), containing such terms and conditions
and in such form, not inconsistent with this Plan, as the Committee shall, in
its discretion, provide. Each Option Agreement shall be executed by the Company
and the Optionee. In the event of a conflict between any provision of the Option
Agreement and the Plan, the provisions of the Plan shall control.

            (c) NO EVIDENCE OF EMPLOYMENT OR SERVICE. Nothing contained in this
Plan or in any Option Agreement shall confer upon any Optionee any right with
respect to the continuation of his or her employment by, or services to, the
Company or any of its Subsidiaries or interfere in any way with the right of the
Company or any of its Subsidiaries (subject to the terms of any separate
agreement to the contrary) at any time to terminate such employment or service
or to increase or decrease the compensation of the Optionee from the rate in
existence at the time of the grant of an Option to such Optionee.

            (d) DATE OF GRANT. The date of grant of an Option under this Plan
shall be the date specified by the Committee for the grant of such option;
provided, however, that in the case of an ISO, the date of grant shall in no
event be earlier than the date as of which the Optionee becomes an employee of
the Company or one of its Subsidiaries.

            (e) EXCHANGE AND BUYOUT OF OPTIONS. The Committee may, at any time
or from time to time, authorize the grant of new Options under this Plan in
exchange for the surrender and cancellation of any or all outstanding Options.
The Committee may at any time buy from an Optionee an Option previously granted
with payment in cash, Securities of the Company or other consideration, based on
such terms and conditions as the Company (acting through the Committee) and the
Optionee may agree.

            (f) OPTIONS AND RIGHTS IN SUBSTITUTION FOR STOCK OPTIONS GRANTED BY
OTHER CORPORATIONS. Options may be granted to eligible persons under the Plan in
substitution for employee stock options granted by other entities to persons who
are or become eligible persons in respect of the Company, in connection with a
distribution, merger or reorganization by or with the granting entity or an
affiliated entity, or the acquisition by the Company, directly or indirectly, of
all or a substantial part of the stock or assets of the other entity."

            (g) LIMITATIONS ON GRANT AND TERMS OF INCENTIVE STOCK OPTIONS.

                  (i) $100,000 Limit. To the extent that the aggregate Fair
      Market Value of stock with respect to which ISOs first become exercisable
      by an Optionee in any calendar year exceeds $100,000, taking into account
      ISOs under this Plan and stock subject to incentive stock options under
      all other plans of the Company or any parent corporation, such options
      will be treated as NSOs. For this purpose, the "Fair Market

                                      -4-
<PAGE>

      Value" of the stock subject to options will be determined as of the date
      the options were awarded. In reducing the number of options treated as
      incentive stock options to meet the $100,000 limit, the most recently
      granted options will be reduced (recharacterized as NSOs) first. To the
      extent a reduction of simultaneously granted options is necessary to meet
      the $100,000 limit, the Committee may, in the manner and to the extent
      permitted by law, designate which shares of Common Stock are to be treated
      as shares acquired pursuant to the exercise of an ISO.

                  (ii) Other Code Limits. ISOs may only be granted to employees
      of the Company or a Subsidiary that satisfy the other eligibility
      requirements of the Code. Any Option Agreement relating to an ISO will
      contain or be deemed to contain such other terms and conditions as from
      time to time are required in order that the Option be an "incentive stock
      option" as that term is defined in Section 422 of the Code.

                  (iii) Disqualifying Dispositions. If Optioned Shares acquired
      by exercise of an ISO granted under this Plan are disposed of within two
      years following the date of grant of the ISO or one year following the
      transfer of the Optioned Shares by the Company to the Optionee upon the
      exercise of such ISO (a "Disqualifying Disposition"), the Optionee shall,
      immediately prior to such Disqualifying Disposition, notify the Company in
      writing of the date and terms of such Disqualifying Disposition and
      provide such other information regarding the Disqualifying Disposition as
      the Company may reasonably require.

      6. OPTION PRICE.

            (a) GENERAL. Subject to Section 9, the price (the "Option Price") at
which each share of Common Stock subject to an Option granted under this Plan
may be purchased shall be determined by the Committee at the time the Option is
granted, which purchase price will be set forth in the applicable Option
Agreement. In no case will the Option Price be less than the greater of:

                  (i) the par value of the Common Stock; or

                  (ii) (A) in the case of an NSO granted to an individual other
                  than a 10% Stockholder described in Section 4(b), 85% of Fair
                  Market Value (as determined in accordance with Section 6(b))
                  of the Common Stock on the date of grant;

                  (B) in the case of an ISO granted to an individual other than
                  a 10% Stockholder described in Section 4(b), 100% of the Fair
                  Market Value (as determined in accordance with Section 6(b))
                  of the Common Stock in the date of grant; or

                  (C) in the case of an Option (ISO or NSO) granted to a 10%
                  Stockholder described in 4(b), 110% of the Fair Market Value
                  of the Common Stock on the date of grant.

                                      -5-
<PAGE>

            (b) DETERMINATION OF FAIR MARKET VALUE. Subject to the requirements
of Section 422 of the Code, for purposes of this Plan, the "Fair Market Value"
of a share of Common Stock, as of any date, shall be determined as follows:

                  (i) if the Common Stock is a class of securities then listed
      or admitted to trading on any national securities exchange or traded on
      any national market system (including, but not limited to, The Nasdaq
      National Market), the closing sale price of the Common Stock on such date
      or, if no such sale takes place on such date, the average of the closing
      bid and ask prices for Common Stock on such date, in each case as
      officially reported on the principal national securities exchange or
      national market system on which such securities are then listed, admitted
      to trading or traded;

                  (ii) if the Common Stock is not a class of securities then
      listed or admitted to trading on any national securities exchange or
      traded on any national market system, or else if no closing sale price or
      closing bid and ask prices thereof are then so reported by any such
      exchange or system, the average of the reported closing bid and ask prices
      for the Common Stock in the over-the-counter market on such date as shown
      by the NASD automated quotation system, or if the Common Stock is not a
      class of securities then quoted on such system, as published by the
      National Quotation Bureau, Incorporated or any similar successor
      organization, and in either case as reported by any member firm of the New
      York Stock Exchange selected by the Company; or

                  (iii) in the absence of an established market for the Common
      Stock of the type described in clauses (i) and (ii) above, the fair value
      of such share of Common Stock on such date as determined by the Board in
      good faith on a fully diluted basis and assuming the conversion of all
      securities then outstanding that are convertible into Common Stock, and in
      a manner consistent with Section 260.140.50 of Title 10 of the California
      Code of Regulations.

            (c) REPRICING OF NSOs. Subsequent to the date of grant of any NSO,
the Committee may, in its sole discretion, subject to the consent of the
Optionee to whom such NSO was granted, establish a new Option Price for such NSO
so as to increase or decrease the Option Price of such NSO.

      7. EXERCISABILITY OF OPTIONS.

            (a) COMMITTEE DETERMINATION.

                  (i) Each Option and the shares of Common Stock covered
      thereby granted under this Plan shall be vested and/or exercisable at such
      time or times, or upon the occurrence of such event or events, and for
      such number of shares of Common Stock subject to such Option or in such
      portions or amounts thereof, as shall be determined by the Committee and
      set forth in the Option Agreement evidencing such Option; provided,
      however, to the extent required to satisfy applicable securities laws and
      subject to Section 7(b), no Option (except an Option granted to an
      officer, director, or consultant of the Company) shall vest and become
      exercisable at a rate of less than 20% per year over five years after the
      date the Option is granted. Subject to the foregoing minimum vesting

                                      -6-
<PAGE>

      requirements, if the Company files a registration statement on Form S-1
      with the SEC under the Securities Act of 1933, as amended (the "1933 Act")
      for the initial public offering of Common Stock (the "IPO"), no Option
      granted under this Plan shall be exercisable as to any of the shares of
      Common Stock covered thereby during the 180-day period immediately
      following the effective date of such registration statement (the "Lock-up
      Period"); and, provided further, however, that unless the Committee
      expressly otherwise provides, if an Option by its terms is to expire
      during the Lock-up Period, the expiration date of such Option shall be
      automatically extended for a period equal in duration to that of the
      period from the commencement date of the Lock-up Period up to (and
      including) the expiration date of such Lock-up Period, but in no event
      shall any such extension extend the expiration date of the Option beyond
      the maximum 10 year term (five years in the case of ISOs granted to 10%
      Stockholders described in 4(b)).

                        (ii) Subject to the provisions of clause (i) above, if
      an Option, or the shares of Common Stock covered thereby, are not at the
      time of grant of such Option immediately exercisable and/or fully vested,
      the Committee may (A) in the Option Agreement evidencing such Option,
      provide for the acceleration of the exercise or vesting date(s) of such
      Option, the acceleration of the vesting of all or a portion of the shares
      of Common Stock covered thereby, or the continuation of the vesting
      (whether before, on or after the date of Termination of the Optionee to
      whom such Option is granted) of all or a portion of such Option and/or the
      shares of Common Stock covered thereby, upon the occurrence of specified
      events and/or (B) at any time prior to the complete termination of such
      Option, accelerate the exercise or vesting date(s) of such Option,
      accelerate the vesting of all or a portion of the shares of Common Stock
      covered thereby, or continue the vesting (whether before, on or after the
      date of Termination of the Optionee to whom such Option is granted) of all
      or a portion of such Option and/or the shares of Common Stock covered
      thereby.

                        (iii) The Committee may, in its discretion, amend any
      term or condition of an outstanding Option, provided (A) such term or
      condition as amended is permitted by this Plan, (B) any such amendment
      shall be made only with the consent of the Optionee to whom the Option was
      granted, or in the event of the death of the Optionee, the Optionee's
      Representatives (as defined in Section 10(d) below), if the amendment is
      materially adverse to the Optionee, and (C) any such amendment of any ISO
      shall be made only after the Committee, after consulting with counsel for
      the Company, determines whether such amendment would constitute a
      "modification" (as that term is defined in Section 424(h) of the Code) of
      any Option which is an ISO.

            (b) AUTOMATIC TERMINATION OF OPTION. Except as otherwise determined
by the Committee and set forth in the Option Agreement, the unexercised portion
of any Option granted under this Plan shall automatically terminate and shall
become null and void and be of no further force or effect upon the first to
occur of the following:

                        (i) the 10-year anniversary of the date on which such
      Option is granted or, in the case of any ISO that is granted to a 10%
      Stockholder described in Section 4(b), the five-year anniversary of the
      date on which such Option is granted;

                                      -7-
<PAGE>

                        (ii) the three-month anniversary of the date on which
      the Optionee to whom such Option was granted ceases to be a director,
      officer or employee of, advisor to, or independent consultant or
      independent contractor to, the Company or any Subsidiary thereof for any
      reason or for no reason (such event, a "Termination"), unless such
      Termination (x) occurs by reason of such Optionee's death or Disability
      (as defined below) or (y) is for Cause (as defined below); provided,
      however, that if such Optionee shall die after the date of Termination to
      which this Section 7(b)(ii) is applicable but before the three-month
      anniversary of such Optionee's date of Termination, the unexercised
      portion of such Option shall automatically terminate and become null and
      void and be of no further force or effect upon the 12-month anniversary of
      such date of Termination;

                        (iii) the 12-month anniversary of the date of
      Termination of the Optionee to whom such Option was granted, if such
      Termination occurs by reason of such Optionee's (x) death or (y)
      Disability (as defined below); provided however, that if a Disability is
      not a "disability" within the meaning of Section 22(e)(3) of the Code and
      such Optionee's Option is an ISO, such Option shall cease to be an ISO and
      thereafter be treated as a NSO on the date three months and one day after
      the Optionee's date of Termination;

                        (iv) the date of the Termination of the Optionee to whom
      such Option was granted, if such Termination is for Cause (as defined
      below) (a "Termination for Cause");

                        (v) on the effective date of a Corporate Transaction (as
      defined in Section 9(b)) to which Section 9(b)(ii) (relating to
      assumptions and substitutions of Options) does not apply; provided,
      however, that an Optionee's right to exercise any Option outstanding prior
      to such effective date shall in all events be suspended during the period
      beginning ten (10) days prior to the proposed effective date of such
      Corporate Transaction and ending on either the actual effective date of
      such Corporate Transaction or upon receipt of notice from the Company that
      such Corporate Transaction will not in fact occur;

                        (vi) except to the extent permitted by Section 10(d),
      the date on which such Option or any part thereof or right or privilege
      relating thereto is transferred (other than by will or the laws of descent
      and distribution), assigned, pledged, hypothecated, attached or otherwise
      disposed of by the Optionee to whom such Option was granted; and

                        (vii) the expiration of such period of time or the
      occurrence of such event as the Committee in its discretion may provide in
      the Option Agreement.

            For purposes of this Plan, the term "Disability" means as defined
under the long-term disability policy of the Company or any Subsidiary of the
Company to which the Optionee provides services regardless of whether the
Optionee is covered by such policy or, if the Company or Subsidiary of the
Company to which the Optionee provides service does not have a long-term
disability plan in place, "Disability" means that an Optionee is unable to carry
out the

                                      -8-
<PAGE>

responsibilities and functions of the position held by the Optionee by reason of
any medically determinable physical or mental impairment.

            For purposes of this Plan, the term "Cause" means, with respect to
the Optionee's Termination by the Company or any of its Subsidiaries, that such
Termination is for "Cause" as such term is expressly defined in a then-effective
written agreement between the Optionee and the Company or any of its
Subsidiaries, or in the absence of such then-effective written agreement and
definition, is based on, in the determination of the Administrator, (1) the
commission by such Optionee of any act of fraud, theft or financial dishonesty
with respect to the Company or any of its Subsidiaries, or such Optionee has
been convicted of, or plead guilty or nolo contendere to, a felony, (2) any
material breach by such Optionee of any material provision of this Plan or any
one or more agreements or understandings between the Company or any Subsidiary
thereof on the one hand and such Optionee on the other hand (whether written or
oral) regarding the terms of such Optionee's service as a director, officer or
employee of, or advisor, independent consultant or independent contractor to,
the Company or any Subsidiary thereof, including, without limitation, the
willful and continued failure or refusal of such Optionee to perform the
material duties required of such Optionee as an director, officer or employee
of, or as an advisor, independent consultant or independent contractor to, the
Company or any Subsidiary thereof, other than as a result of such Optionee
having a Disability, (3) such Optionee's intentional or willful disregard of the
policies of the Company or any Subsidiary thereof so as to cause loss, damage or
injury to the property, reputation or employees of the Company or any Subsidiary
thereof, or (4) any other misconduct by such Optionee which is otherwise
materially injurious to the financial condition or business reputation of, or is
otherwise materially injurious to, the Company or a Subsidiary thereof.

            Anything contained in this Plan to the contrary notwithstanding,
unless otherwise provided in the applicable Option Agreement, a Termination of
an Optionee shall not be deemed to occur solely by reason of the Company's
change of the duties of the Optionee, so long as such Optionee continues to be a
director, officer or employee of, advisor to, or independent consultant or
independent contractor to, the Company or any Subsidiary thereof. For purposes
of Section 7(b), an Optionee employed by the Company or any Subsidiary thereof
shall not be deemed to have terminated his or her employment with the Company or
such Subsidiary in the case of sick leave, military leave, or any other leave of
absence approved by the Committee; provided, however, that such leave is for a
period of not more than ninety (90) days or reemployment upon the expiration of
such leave is guaranteed by contract or statute.

      8. PROCEDURE FOR EXERCISE.

            (a) PAYMENT. At the time an Option is granted under this Plan, the
Committee shall, in its sole discretion, specify in the applicable Option
Agreement one or more of the following forms of payment which may be used by an
Optionee (but only to the extent permitted by applicable law) upon exercise of
his or her Option:

                  (i) by cash (by wire transfer of immediately available funds
      to a bank account held by the Company designated by the Committee or a
      personal or certified check payable to the Company);

                                      -9-
<PAGE>

                  (ii) by cancellation of indebtedness of the Company to the
      Optionee;

                  (iii) by surrender of shares of Common Stock which either (A)
      have been owned by the Optionee for more than six months and have been
      paid for within the meaning of Rule 144 promulgated by the SEC under the
      1933 Act (and, if such shares of Common Stock were purchased from the
      Company or any Subsidiary thereof by means of a promissory note, such note
      has been fully paid with respect to such shares); or (B) were obtained by
      the Optionee in the public market;

                  (iv) by tender of a full recourse promissory note having such
      terms as may be approved by the Committee and bearing interest at a rate
      sufficient to avoid imputation of income under Sections 483 and 1274 of
      the Code; provided, however, that an Optionee who is not a director,
      officer or employee of the Company or any of its Subsidiaries will not be
      entitled to tender such a promissory note unless the note is adequately
      secured by collateral other than the shares of Common Stock being
      purchased upon the exercise of the Option;

                  (v) by waiver of compensation due or accrued to the Optionee
      for services rendered to the Company or any of its Subsidiaries;

                  (vi) if the Common Stock is a class of securities then listed
      or admitted to trading on any national securities exchange or traded on
      any national market system (including, but not limited to, The Nasdaq
      National Market), by payment through a broker-dealer sale and remittance
      procedure pursuant to which the Optionee (A) shall provide written
      instructions to a Company-designated brokerage firm to effect the
      immediate sale of some or all of the purchased shares of Common Stock and
      remit to the Company, out of the sale proceeds available on the settlement
      date, sufficient funds to cover the aggregate exercise price payable for
      the purchased shares of Common Stock and (B) shall provide written
      directives to the Company to deliver the certificates for the purchased
      shares of Common Stock directly to such brokerage firm in order to
      complete the sale transaction; or

                  (vii) any combination of the methods set forth in clauses (i)
      through (vi).

            (b) NOTICE. An Optionee (or other person, as provided in Section
10(d)) may exercise an Option granted under this Plan in whole or in part, as
provided in the Option Agreement evidencing his or her Option, by delivering a
written notice (the "Notice") to the Committee (or such other person or entity
designated by the Committee from time to time).

            (c) CONTENT OF THE NOTICE. The Notice shall:

                  (i) state that the Optionee elects to exercise the Option;

                  (ii) state the number of shares with respect to which the
      Option is being exercised (the "Optioned Shares");

                                      -10-
<PAGE>

                  (iii) state the method of payment for the Optioned Shares
      (which method must be available to the Optionee under the terms of his or
      her Option Agreement);

                  (iv) state the date upon which the Optionee desires to
      consummate the purchase of the Optioned Shares (which date must be prior
      to the termination of such Option, be no later than 30 days from delivery
      of such Notice and be not otherwise prohibited under the terms of his or
      her Option Agreement);

                  (v) include any representations and warranties of the Optionee
      required pursuant to Section 10(b);

                  (vi) if the Option is exercised pursuant to Section 10(d) by
      any person other than the Optionee, include evidence to the satisfaction
      of the Company (or such other person or entity designated by the Committee
      from time to time) of the right of such person to exercise the Option; and

                  (vii) include such further provisions consistent with this
      Plan as the Committee (or such other person or entity designated by the
      Committee from time to time) may from time to time require.

            (d) JOINDER TO STOCKHOLDERS' AGREEMENT. Except as otherwise set
forth in the applicable Option Agreement, no shares of Common Stock shall be
issued and delivered upon the exercise of Options granted under this Plan,
unless and until the Optionee to whom such shares shall be issued and delivered
shall have executed a counterpart to the Stockholders' Agreement of the Company,
dated August 10, 2001, among the Company and the stockholders named therein, as
the same may be amended from time to time (the "Stockholders' Agreement"),
agreeing to be treated as a "Management Stockholder" (as defined therein) with
respect to such shares. The Company may delay the issuance of shares of Common
Stock upon the exercise of Options granted under this Plan until the receipt of
such counterpart to the Stockholders' Agreement.

            (e) ISSUANCE OF STOCK CERTIFICATES. The Company shall issue a stock
certificate in the name of the Optionee (or such other person exercising the
Option in accordance with the provisions of Section 10(d)) for the Optioned
Shares with respect to which such Option is being exercised as soon as
practicable after receipt of the Notice and payment of the aggregate Option
Price for such shares. Neither the Optionee nor any person exercising an Option
in accordance with the provisions of Section 10(d) shall have any privileges as
a stockholder of the Company with respect to any shares of stock subject to an
Option granted under this Plan until the date of issuance of a stock
certificate.

            (f) 83(b) ELECTIONS. Each Optionee shall deliver to the Company a
copy of any election filed by such Optionee with the Internal Revenue Service
relating to any Optioned Shares no later than 30 days following the filing of
such election with the Internal Revenue Service.

                                      -11-
<PAGE>

      9. ADJUSTMENTS.

            (a) CHANGES IN CAPITAL STRUCTURE. Subject to Section 9(b), if the
Common Stock is changed by reason of a stock split, reverse stock split, stock
dividend, recapitalization, combination or reclassification, or converted into
or exchanged for other securities as a result of a merger, consolidation or
reorganization, the Committee shall make such adjustments in the number and
class of shares of stock with respect to which Options may be granted under this
Plan as shall be equitable and appropriate in order to make such Options, as
nearly as may be practicable, equivalent to such Options immediately prior to
such change. A corresponding adjustment changing the number and class of shares
allocated to, and the Option Price of, each Option or portion thereof
outstanding at the time of such change shall likewise be made. Anything
contained in this Plan to the contrary notwithstanding, in the case of ISOs, no
adjustment under this Section 9(a) shall be appropriate if such adjustment (i)
would constitute a modification, extension or renewal of such ISOs within the
meaning of Sections 422 and 424 of the Code, and the regulations promulgated by
the Treasury Department thereunder, or (ii) would, under Section 422 of the Code
and the regulations promulgated by the Treasury Department thereunder, be
considered as the adoption of a new plan requiring stockholder approval.

            (b) CORPORATE TRANSACTIONS. The following rules shall apply in
connection with the dissolution, winding-up or liquidation of the Company, a
reorganization, merger or consolidation in which the Company is not the
surviving corporation, or a sale of all or substantially all of the capital
stock or assets of the Company to another person or entity (a "Corporate
Transaction"):

                  (i) each holder of an Option outstanding at such time shall be
      given (A) written notice of such Corporate Transaction at least 20 days
      prior to its proposed effective date (as specified in such notice) and (B)
      an opportunity, during the period commencing with delivery of such notice
      and ending 10 days prior to such proposed effective date, to exercise the
      Option to the full extent to which such Option would have been exercisable
      by the Optionee at the expiration of such 20-day period; and

                  (ii) anything contained in this Plan to the contrary
      notwithstanding, Section 9(b)(i) shall not be applicable if provision
      shall be made in connection with such Corporate Transaction for the
      assumption of outstanding Options by, or the substitution for such Options
      of new options covering the stock of, the surviving, successor or
      purchasing entity, or a "Parent Corporation" or "Subsidiary Corporation"
      thereof (as defined in Sections 424(e) and (f), respectively of the Code),
      with appropriate adjustments as to the number, kind and option prices of
      the stock subject to such options; provided, however, that in the case of
      ISOs, the Committee shall, to the extent consistent with the best
      interests of the Company (such best interests to be determined in good
      faith by the Committee in its sole discretion), consult with counsel to
      ensure that any such assumption or substitution will not constitute a
      modification, extension or renewal of the ISOs within the meaning of
      Section 424(h) of the Code and the regulations promulgated by the Treasury
      Department thereunder.

            (c) SPECIAL RULES. The following rules shall apply in connection
with Sections 9(a) and (b):

                                      -12-
<PAGE>

                  (i) no fractional shares shall be issued as a result of any
      such adjustment, and any fractional shares resulting from the computations
      pursuant to Sections 9(a) or (b) shall be eliminated without any
      consideration due to any Optionees;

                  (ii) no adjustment shall be made for cash dividends or the
      issuance to stockholders of rights to subscribe for additional shares of
      Common Stock or other securities; and

                  (iii) any adjustments referred to in Sections 9(a) or (b)
      shall be made by the Committee in its sole discretion and shall be
      conclusive and binding on all persons holding Options granted under this
      Plan.

      10. RESTRICTIONS ON OPTIONS AND OPTIONED SHARES.

            (a) COMPLIANCE WITH SECURITIES LAWS. No Options shall be granted
under this Plan, and no shares of Common Stock shall be issued and delivered
upon the exercise of Options granted under this Plan, unless and until the
Company and/or the Optionees to whom such Options shall be granted shall have
complied with all applicable Federal or state registration, listing and/or
qualification requirements and all other requirements of law or of any
regulatory agencies having jurisdiction. The Company may delay the issuance of
shares of Common Stock upon the exercise of Options granted under this Plan
until completion of any action or the receipt of any consent which the Company
deems necessary under any applicable law (including, without limitation, state
securities or "blue sky" laws).

            (b) REPRESENTATIONS AND WARRANTIES. The Committee in its discretion
may, as a condition to the exercise of any Option granted under this Plan,
require the Optionee to whom such Option shall be granted to make such
representations and warranties as are deemed appropriate by the Company.

            (c) LEGENDS. Each certificate issued by the Company (or its transfer
agent) that represents shares of Common Stock acquired upon the exercise of
Options that have not been registered under the Securities Act shall, unless
otherwise directed by the Committee, be stamped or otherwise imprinted with a
legend in substantially the following form (in addition to any other legends and
other restrictions as the Committee may deem necessary or advisable, including
restrictions under any applicable federal, state or foreign securities laws, or
any rules, regulations and other requirements of the SEC or any securities
exchange or automated quotation system on which such the Common Stock may be
listed, admitted for trading or traded, or any applicable agreement):

            "THE SECURITIES REPRESENTED BY THIS CERTIFICATE HAVE NOT BEEN
            REGISTERED UNDER THE SECURITIES ACT OF 1933 (THE "ACT"). THESE
            SECURITIES HAVE BEEN ACQUIRED FOR INVESTMENT AND NOT WITH A VIEW TO
            DISTRIBUTION OR RESALE, AND MAY NOT BE SOLD, OFFERED FOR SALE,
            PLEDGED OR HYPOTHECATED IN THE ABSENCE OF AN EFFECTIVE REGISTRATION
            STATEMENT FOR SUCH SECURITIES UNDER THE ACT OR AN OPINION

                                      -13-
<PAGE>

            OF COUNSEL SATISFACTORY TO THE ISSUER THAT SUCH REGISTRATION IS NOT
            REQUIRED.

            THE SECURITIES REPRESENTED BY THIS CERTIFICATE ARE ALSO SUBJECT TO A
            STOCKHOLDERS' AGREEMENT DATED AS OF AUGUST 10, 2001, AMONG THE
            ISSUER OF SUCH SECURITIES (THE "COMPANY") AND CERTAIN OF THE
            COMPANY'S STOCKHOLDERS. THE TERMS OF SUCH STOCKHOLDERS' AGREEMENT
            INCLUDE, AMONG OTHER THINGS, RESTRICTION ON TRANSFERS, A COPY OF
            SUCH STOCKHOLDERS' AGREEMENT WILL BE FURNISHED WITHOUT CHARGE BY THE
            COMPANY TO THE HOLDER HEREOF UPON WRITTEN REQUEST."

            (d) NO TRANSFERABILITY; LIMITED EXCEPTION TO TRANSFER RESTRICTIONS.

                  (i) Limit on Exercise and Transfer. Unless otherwise expressly
      provided in (or pursuant to) this Section 10(d), by applicable law and by
      the Option Agreement, as the same may be amended:

                        (A) all Options are non-transferable and will not be
                  subject in any manner to sale, transfer, anticipation,
                  alienation, pledge, assignment, encumbrance or charge;

                        (B) Options will be exercised only by the Optionee; and

                        (C) shares issuable pursuant to an Option will be
                  delivered only to (or for the account of) the Optionee.

            In addition, the shares shall be subject to the restrictions set
forth in the applicable Option Agreement.

                  (ii) Further Exceptions to Limits on Transfer. The exercise
      and transfer restrictions in Section 10(d)(i) above will not apply to:

                        (A) transfers to the Company;

                        (B) transfers by gift to "immediate family" as such term
                  is defined on SEC Rule 16a-1(e) promulgated under the Exchange
                  Act;

                        (C) transfers by will or the laws of descent and
                  distribution; or

                        (D) if the Optionee has suffered a Disability, permitted
                  transfers or exercises on behalf of the Optionee by the
                  Optionee's duly authorized legal representative.

                  Notwithstanding anything else in this Section 10(d)(ii) to the
      contrary, but subject to compliance with all applicable laws, ISOs will be
      subject to any and all transfer restrictions under the Code applicable to
      such ISOs or necessary to maintain the intended

                                      -14-
<PAGE>

      tax consequences of such ISOs. Notwithstanding Section 10(d)(ii)(B) above
      but subject to compliance with all applicable laws, any contemplated
      transfer by gift to "immediate family" as referenced in Section
      10(d)(ii)(B) above is subject to the condition precedent that the transfer
      be approved by the Committee for it to be effective.

      11. ADOPTION AND STOCKHOLDER APPROVAL.

            This Plan shall become effective on the date (the "Effective Date")
of its adoption by the Board. This Plan shall be approved by the stockholders of
the Company, consistent with applicable laws, within 12 months before or after
the Effective Date. Upon the Effective Date, the Committee may grant Options
pursuant to this Plan; provided, however, that (a) no Option may be exercised
prior to initial stockholder approval of this Plan, (b) no Option granted
pursuant to an increase in the number of shares of Common Stock available under
this Plan by the Board's or the Committee's amendment of this Plan may be
exercised prior to the time such increase has been approved by the stockholders
of the Company, consistent with applicable laws; (c) in the event that initial
stockholder approval of this Plan is not obtained within the time period
provided herein, all Options granted under this Plan shall be canceled; and (d)
in the event that stockholder approval of any increase in the number of shares
of Common Stock available under this Plan is not obtained within the time period
provided herein, all Options granted under this Plan pursuant to such increase
shall be canceled.

      12. EXPIRATION AND TERMINATION OF THE PLAN.

            Except with respect to Options then outstanding, this Plan shall
expire on the first to occur of (i) the tenth anniversary of the date on which
this Plan is adopted by the Board, (ii) the tenth anniversary of the date on
which this Plan is approved by the stockholders of the Company in accordance
with applicable laws and (iii) the date as of which the Board, in its sole
discretion, determines that this Plan shall terminate (the "Expiration Date").
Any Options outstanding as of the Expiration Date shall remain in effect until
they have been exercised or terminated or have expired by their respective
terms.

      13. AMENDMENT OF THIS PLAN.

            This Plan may be amended, suspended or terminated by the Board at
any time. This Plan may also be amended by the Board or the Committee,
including, without limitation, to the extent necessary to qualify any or all
outstanding Options granted under this Plan or Options to be granted under this
Plan for favorable federal income tax treatment (including deferral of taxation
upon exercise) as may be afforded incentive stock options under Section 422 of
the Code, to the extent necessary to ensure the qualification of this Plan under
Rule 16b-3, at such time, if any, as the Company has a class of stock registered
pursuant to Section 12 of the 1934 Act, and to the extent necessary to qualify
the shares of Common Stock issuable upon exercise of any outstanding Options
granted, or Options to be granted, under this Plan for listing or admission for
trading on any securities exchange or automated quotation system. Any amendment
approved by the Committee which is of a scope that requires stockholder approval
under applicable law or in order to ensure favorable federal income tax
treatment for any ISOs or requires stockholder approval in order to ensure the
compliance of this Plan with Rule 16b-3 at

                                      -15-
<PAGE>

such time, if any, as the Company has a class of capital stock registered
pursuant to Section 12 of the 1934 Act, shall be subject to obtaining such
stockholder approval.

      14. CAPTIONS.

            The use of captions in this Plan is for convenience. The captions
are not intended to provide substantive rights or to affect the construction or
interpretation of the provisions of this Plan.

      15. DELIVERY OF FINANCIAL STATEMENTS; CONFIDENTIAL INFORMATION.

            The Company shall deliver annually to Optionees such financial
statements of the Company as are required to satisfy applicable securities laws.
Any financial or other information relating to the Company obtained by Optionees
in connection with or as a result of this Plan or their Options shall be treated
as confidential.

      16. WITHHOLDING TAXES.

            In the event that any federal, state, or local income taxes,
employment taxes, Federal Insurance Contributions Act ("FICA") withholdings or
other amounts are required by applicable law or governmental regulation to be
withheld from the Optionee's salary, wages or other remuneration in connection
with the exercise of an Option or a Disqualifying Disposition, the Company may
withhold from such Optionee's wages, if any, or other remuneration, or may
require the Optionee to advance in cash to the Company the amount of such
withholdings unless a different withholding arrangement, including the use of
shares of Common Stock, is authorized by the Committee (and permitted by
applicable law); provided, however, that with respect to persons subject to
Section 16 of the 1934 Act, any such withholding arrangement shall be in
compliance with any applicable provisions of Rule 16b-3 promulgated under
Section 16 of the 1934 Act. For purposes of this Section 16, the Fair Market
Value of the shares of Common Stock (if any) withheld for purposes of payroll
withholding shall be determined as of the most recent date practicable prior to
the date of exercise and in the manner provided in Section 6(b). If the Fair
Market Value of the shares of Common Stock withheld is less than the amount of
the payroll withholdings required, the Optionee may be required to advance the
difference in cash to the Company. In no event will the value of Shares withheld
exceed the minimum amount of required withholding under applicable law. The
Committee may condition the transfer of any shares of Common Stock or the
removal of any restrictions on any Option on the satisfaction by the Optionee of
the foregoing withholding obligations.

      17. OTHER PROVISIONS.

            Each Option granted under this Plan may contain such other terms and
conditions not inconsistent with this Plan as may be determined by the
Committee, in its sole discretion. Notwithstanding the foregoing, each ISO
granted under this Plan shall include those terms and conditions which are
necessary to qualify the ISO as an "incentive stock option" within the meaning
of Section 422 of the Code and the regulations thereunder and shall not include
any terms or conditions which are inconsistent therewith.

                                      -16-
<PAGE>

      18. NUMBER AND GENDER.

            With respect to words used in this Plan, the singular form shall
include the plural form, the masculine gender shall include the feminine gender,
and vice-versa, as the context requires.

      19. NONEXCLUSIVITY OF THIS PLAN.

            Neither the adoption of this Plan by the Board, the submission of
this Plan to the stockholders of the Company for approval, nor any provision of
this Plan shall be construed as creating any limitations on the power of the
Board or the Committee to adopt such additional compensation arrangements as it
may deem desirable, including, without limitation, the granting of stock options
otherwise than under this Plan, and such arrangements may be either generally
available or applicable only in specific cases.

      20. NO RESTRICTION ON CORPORATE POWERS.

            The existence of this Plan, the Option Agreements, and the Options
granted hereunder, shall not limit, affect or restrict in any way the right or
power of the Board or the stockholders of the Company to make or authorize: (a)
any adjustment, recapitalization, reorganization or other change in the
Company's or any Subsidiary's capital structure or its business; (b) any merger,
amalgamation, consolidation or change in the ownership of the Company or any
Subsidiary; (c) any issue of bonds, debentures, capital, preferred or prior
preference stocks ahead of or affecting the Company's capital stock or the
rights thereof; (d) any dissolution or liquidation of the Company or any
Subsidiary; (e) any sale or transfer of all or any part of the Company or any
Subsidiary's assets or business; or (f) any other corporate act or proceeding by
the Company or any Subsidiary. No Participant, Beneficiary or any other person
shall have any claim under any Option or Option Agreement against any member of
the Board or the Committee, or the Company or any employees, officers or agents
of the Company or any Subsidiary as a result of any such action.

      21. GOVERNING LAW.

            The validity and construction of this Plan and the instruments
evidencing the Options granted hereunder shall be governed by the laws of the
State of Delaware without regard to conflict of laws provisions thereunder.

                                    * * * * *

                                      -17-

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