Registration No. ____________

================================================================================

                       SECURITIES AND EXCHANGE COMMISSION
                             Washington, D.C. 20549
                          -----------------------------

                                    FORM S-8
                             REGISTRATION STATEMENT
                        UNDER THE SECURITIES ACT OF 1933
                          -----------------------------

                                Concord EFS, Inc.
             (Exact Name of Registrant as Specified in its Charter)
                          -----------------------------

                               Delaware 04-2462252
                (State or Other Jurisdiction of (I.R.S. Employer
               Incorporation or Organization) Identification No.)

                             2525 Horizon Lake Drive
                                    Suite 120
                            Memphis, Tennessee 38133
               (Address of Principle Executive Offices) (Zip Code)


                               Star Systems, Inc.
                           2000 Equity Incentive Plan
                            (Full Title of the Plan)
                          -----------------------------

                                Thomas J. Dowling
                      Senior Vice President and Controller
                                Concord EFS, Inc.
          2525 Horizon Lake Drive, Suite 120, Memphis, Tennessee 38133
                                 (901) 371-8000
 (Name, Address and Telephone Number, Including Area Code, of Agent for Service)

                                 With Copies to:
                    Richard M. Harter, Esq., Bingham Dana LLP
                 150 Federal Street, Boston, Massachusetts 02110
                                 (617) 951-8415

                         CALCULATION OF REGISTRATION FEE
<TABLE>
<S>                         <C>                        <C>                  <C>                 <C>
--------------------------- -------------------------- -------------------- ------------------- --------------
   Title Of Securities       Amount To Be Registered    Proposed Maximum     Proposed Maximum     Amount Of
     To Be Registered                                  Offering Price Per       Aggregate       Registration
                                                              Share           Offering Price         Fee
--------------------------- -------------------------- -------------------- ------------------- --------------
--------------------------- -------------------------- -------------------- ------------------- --------------
      Common Stock,            779,008 shares (1)          $ 10.21 (2)      $ 7,953,671.68 (2)   $ 1,988.42
   $0.33 1/3 par value
--------------------------- -------------------------- -------------------- ------------------- --------------
</TABLE>
(1)  Shares  issuable  under options  granted under the Star Systems,  Inc. 2000
     Equity Incentive Plan.

(2)  Calculated in accordance  with Rule 457(h)(1)  under  Regulation C based on
     the price at which the options may be exercised.


<PAGE>

                                     PART I

              INFORMATION REQUIRED IN THE SECTION 10(a) PROSPECTUS


Item 1.  Plan Information.*


Item 2.  Registrant Information and Employee Plan Annual Information.*

* This  registration  statement  relates to securities  of the  registrant to be
offered  pursuant to the Star  Systems,  Inc.  2000 Equity  Incentive  Plan,  as
indicated  on the facing  sheet  hereof.  Information  required  by Part I to be
contained in the Section 10(a)  prospectus  related to this plan is omitted from
this registration statement in accordance with Rule 428 under the Securities Act
of 1933, as amended ("Securities Act"), and the Note to Part I of Form S-8.

                                     PART II

               INFORMATION REQUIRED IN THE REGISTRATION STATEMENT


Item 3.  Incorporation of Documents by Reference.

         The following documents are incorporated by reference herein:

1.   The registrant's annual report on Form 10-K for the year ended December 31,
     1999;

2.   The  registrant's  quarterly  reports on Form 10-Q for the  quarters  ended
     March 31, June 30 and September 30, 2000;

3.   The registrant's  current reports on Form 8-K filed with the Securities and
     Exchange Commission ("SEC") on October 10, 2000 and February 15, 2001;

4.   The  description  of the current  management  and board of directors of the
     registrant  contained  in  the  proxy  statement  of the  registrant  filed
     pursuant to Section 14(a) of the Securities Exchange Act of 1934 ("Exchange
     Act") for the registrant's annual meeting of shareholders to be held on May
     25, 2000; and

5.   The description of the registrant's common stock contained in Amendment No.
     1 to the registration  statement on Form S-4 filed with the SEC on June 27,
     2000,  including  any amendment or report filed for the purpose of updating
     such description.

         All  documents  filed by the  registrant  pursuant to  Sections  13(a),
13(c), 14 or 15(d) of the Exchange Act, as amended (the "Exchange  Act"),  after
the  date  of  this  registration  statement  and  prior  to  the  filing  of  a
post-effective amendment which indicates that all securities offered hereby have
been sold or which deregisters all securities then remaining unsold,  are deemed
to be  incorporated  by reference into this  registration  statement and to be a
part  hereof  from  the  respective  dates of  filing  of such  documents  (such
documents,  and the documents enumerated above, being hereinafter referred to as
"Incorporated Documents").

         Any statement contained in an Incorporated  Document shall be deemed to
be modified or  superseded  for purposes of this  registration  statement to the
extent  that a statement  contained  herein or in any other  subsequently  filed
Incorporated Document modifies or supersedes such statement.  Any such statement
so  modified  or  superseded  shall  not be  deemed,  except as so  modified  or
superseded, to constitute a part of this registration statement.
<PAGE>


Item 4.  Description of Securities.

         Not Required


Item 5.  Interests of Named Experts and Counsel.

         The legality of the securities being registered  hereby has been passed
upon for the  registrant  by  Bingham  Dana LLP,  150  Federal  Street,  Boston,
Massachusetts  02110.  Richard M.  Harter,  a partner of Bingham  Dana LLP, is a
Director  and  Secretary  of the  registrant  and  owns  139,550  shares  of the
registrant's common stock,  including 46,000 shares subject to unexercised stock
options.


Item 6.  Indemnification of Directors and Officers.

         Section  145  of  the   Delaware   General   Corporation   Law  permits
indemnification of officers and directors under certain conditions.

         Article   SEVENTH  of  the   registrant's   Restated   Certificate   of
         Incorporation, as amended, provides:
         No  director  of the  Corporation  shall be  personally  liable  to the
         Corporation  or to any of its  stockholders  for  monetary  damages for
         breach of fiduciary duty as a director,  notwithstanding  any provision
         of law imposing such liability;  provided,  however, that to the extent
         required  from time to time by  applicable  law,  this Article  Seventh
         shall not eliminate or limit the liability of a director, to the extent
         such liability is provided by applicable law, (i) for any breach of the
         director's duty of loyalty to the Corporation or its stockholders, (ii)
         for acts or omissions  not in good faith or which  involve  intentional
         misconduct  or a knowing  violation of law,  (iii) under Section 174 of
         Title 8 of the Delaware Code, or (iv) for any  transactions  from which
         the director derived an improper personal  benefit.  No amendment to or
         repeal of this Article Seventh shall apply to or have any effect on the
         liability  or alleged  liability of any director for or with respect to
         any acts or omissions of such director occurring prior to the effective
         date of such amendment or repeal.

         Article VII of the registrant's By-Laws provides:

         SECTION 7.1 RIGHT TO INDEMNIFICATION.  Each person who was or is made a
         party or is threatened  to be made a party to or is otherwise  involved
         in  any  action,   suit  or  proceeding,   whether   civil,   criminal,
         administrative or investigative (a "Proceeding"), by reason of being or
         having  been a director  or officer  of the  Corporation  or serving or
         having served at the request of the Corporation as a director, trustee,
         officer,  employee or agent of another corporation or of a partnership,
         joint  venture,  trust  or other  enterprise,  including  service  with
         respect to an  employee  benefit  plan (an  "Indemnitee"),  whether the
         basis of such  proceeding  is  alleged  action or  failure to act in an
         official capacity as a director, trustee, officer, employee or agent or
         in any other  capacity while serving as a director,  trustee,  officer,
         employee  or  agent,  shall be  indemnified  and held  harmless  by the
         Corporation  to the fullest extent  authorized by the Delaware  General
         Corporation  Law, as the same exists or may  hereafter be amended (but,
         in the  case of any  such  amendment,  only  to the  extent  that  such
         amendment  permits the Corporation to provide  broader  indemnification
         rights than permitted  prior thereto) (as used in this Article VII, the
         "Delaware  Law"),  against all expense,  liability and loss  (including

<PAGE>

         attorneys' fees, judgments,  fines, ERISA excise taxes or penalties and
         amounts  paid in  settlement)  reasonably  incurred or suffered by such
         Indemnitee  in  connection  therewith  and such  indemnification  shall
         continue as to an Indemnitee who has ceased to be a director,  trustee,
         officer,  employee  or agent  and  shall  inure to the  benefit  of the
         Indemnitee's heirs,  executors and administrators;  PROVIDED,  HOWEVER,
         that,  except as  provided  in  Section  7.2  hereof  with  respect  to
         Proceedings to enforce rights to indemnification, the Corporation shall
         indemnify any such  Indemnitee in connection with a Proceeding (or part
         thereof)  initiated by such Indemnitee only if such Proceeding (or part
         thereof) was  authorized by the board of directors of the  Corporation.
         The right to  indemnification  conferred in this Article VII shall be a
         contract  right  and  shall  include  the  right  to  be  paid  by  the
         Corporation  the expenses  incurred in defending any such Proceeding in
         advance  of its  final  disposition  (an  "Advancement  of  Expenses");
         PROVIDED,   HOWEVER,  that,  if  the  Delaware  Law  so  requires,  and
         Advancement  of Expenses  incurred by an Indemnitee  shall be made only
         upon delivery to the Corporation of an undertaking (an  "Undertaking"),
         by or on behalf of such Indemnitee, to repay all amounts so advanced if
         it shall ultimately be determined by final judicial decision from which
         there is no further right to appeal (a "Final  Adjudication") that such
         Indemnitee is not entitled to be  indemnified  for such expenses  under
         this Article VII or otherwise.

         The  registrant  also  maintains  an  insurance  policy  which  insures
directors and officers of the registrant against certain liabilities which might
be incurred in connection with the performance of their duties.

Item 7.  Exemption from Registration Claimed.

         Not required

Item 8.  Exhibits.

Exhibit No.                                                  Description

4.1  Registrant's  Restated  Certificate of Incorporation is incorporated herein
     by reference to Exhibit 4.1 to the registrant's  registration  statement on
     Form S-8 (File No. 333-74215), filed on March 10, 1999

4.2  Registrant's  Certificate  of  Amendment  to the  Restated  Certificate  of
     Incorporation  is  incorporated  herein  by  reference  to  Exhibit  3.3 to
     amendment  no. 2 to the  registrant's  registration  statement  on Form S-3
     (File No. 333-77829), filed on June 14, 1999

4.3  Registrant's  Amended  and  Restated  Bylaws  are  incorporated  herein  by
     reference to Exhibit 4.2 to the registrant's registration statement on Form
     S-8 (File No. 333-74215), filed on March 10, 1999

*5.1 Opinion of Bingham Dana LLP

*23.1 Consent of Ernst & Young LLP

*23.2  Consent of Bingham Dana LLP(included in Exhibit 5.1 to this  registration
       statement)

*24.1  Powers of Attorney (included on the  signature  page to this registration
       statement)

*99.1  Star Systems, Inc. 2000 Equity Incentive Plan
---------------------------------
         *        Filed herewith



<PAGE>

Item 9.  Undertakings.

(a)      The undersigned registrant hereby undertakes:


         To file,  during any period in which  offers or sales are being made, a
         post-effective amendment to this registration statement:

               To include any  prospectus  required  by Section  10(a)(3) of the
               Securities Act;

                           To  reflect  in the  prospectus  any  facts or events
                  arising  after  the  effective   date  of  this   registration
                  statement  (or  the  most  recent   post-effective   amendment
                  thereof) which, individually or in the aggregate,  represent a
                  fundamental  change  in the  information  set  forth  in  this
                  registration  statement.  Notwithstanding  the foregoing,  any
                  increase or decrease in volume of  securities  offered (if the
                  total dollar value of securities offered would not exceed that
                  which was  registered)  and any deviation from the low or high
                  end of the estimated  maximum  offering range may be reflected
                  in the form of prospectus  filed with the SEC pursuant to Rule
                  424(b) if, in the  aggregate,  the changes in volume and price
                  represent  no more than a 20  percent  change  in the  maximum
                  aggregate  offering  price  set forth in the  "Calculation  of
                  Registration   Fee"  table  in  the   effective   registration
                  statement;

                           To include any material  information  with respect to
                  the plan of  distribution  not  previously  disclosed  in this
                  registration   statement  or  any  material   change  to  such
                  information in this registration statement;

                           That,  for the purpose of  determining  any liability
         under the Securities Act, each such  post-effective  amendment shall be
         deemed to be a new  registration  statement  relating to the securities
         offered therein, and the offering of such securities at that time shall
         be deemed to be the initial bona fide offering thereof.

                  To  remove  from  registration  by means  of a  post-effective
         amendment any of the securities being registered which remain unsold at
         the termination of the offering.

(b)  The  undersigned   registrant  hereby  undertakes  that,  for  purposes  of
determining  any  liability  under  the  Securities  Act,  each  filing  of  the
registrant's  annual  report  pursuant to Section 13(a) or 15(d) of the Exchange
Act (and,  where  applicable,  each filing of an employee  benefit plan's annual
report  pursuant to Section 15(d) of the Exchange Act ) that is  incorporated by
reference  in  this  registration   statement  shall  be  deemed  to  be  a  new
registration  statement  relating to the  securities  offered  therein,  and the
offering of such  securities at that time shall be deemed to be the initial bona
fide offering thereof.

(c) Insofar as indemnification  for liabilities arising under the Securities Act
may  be  permitted  to  directors,  officers  and  controlling  persons  of  the
registrant pursuant to the foregoing  provisions,  or otherwise,  the registrant
has been advised that in the opinion of the SEC such  indemnification is against
public  policy  as  expressed  in  the   Securities   Act  and  is,   therefore,
unenforceable.  In the  event  that a claim  for  indemnification  against  such
liabilities  (other than the payment by the  registrant of expenses  incurred or
paid by a  director,  officer or  controlling  person of the  registrant  in the
successful  defense of any  action,  suit or  proceeding)  is  asserted  by such
director,  officer or controlling person in connection with the securities being
registered, the registrant will, unless in the opinion of its counsel the matter
has been  settled by  controlling  precedent,  submit to a court of  appropriate
jurisdiction the question whether such  indemnification  by it is against public
policy as  expressed  in the  Securities  Act and will be  governed by the final
adjudication of such issue.



<PAGE>




                                   SIGNATURES

         Pursuant to the  requirements  of the  Securities  Act, the  registrant
certifies  that it has  reasonable  grounds to believe  that it meets all of the
requirements  for  filing  on Form S-8 and has  duly  caused  this  registration
statement  to be  signed  on its  behalf  by  the  undersigned,  thereunto  duly
authorized,  in the city of  Memphis,  State of  Tennessee,  on this 22nd day of
February, 2001.

     CONCORD EFS, INC.



     By: /s/ Dan M. Palmer
     --------------------------------------
     Dan M. Palmer
     Chairman of the Board of Directors and
     Chief Executive Officer












<PAGE>





         KNOW  ALL MEN BY THESE  PRESENTS,  that  each  person  whose  signature
appears below  constitutes and appoints Thomas J. Dowling and William E. Lucado,
and each of them,  with the power to act without the other,  his or her true and
lawful  attorneys-in-fact  and  agents,  with  full  power of  substitution  and
resubstitution,  for him or her and in his or her name,  place and stead, in any
and all  capacities,  to sign any and all amendments  (including  post-effective
amendments)  to this  registration  statement,  and to file the  same,  with all
exhibits  thereto  and  other  documents  in  connection  therewith,   with  the
Securities and Exchange  Commission,  granting unto said  attorneys-in-fact  and
agents,  and each of them,  full power and  authority to do and perform each and
every  act and  thing  requisite  and  necessary  to be done  in and  about  the
premises,  as fully as and to all  intents  and  purposes  as he or she might or
could do in  person,  hereby  ratifying  and  confirming  all that  each of said
attorneys-in-fact and agents, or his substitute or substitutes,  may lawfully do
and cause to be done by virtue hereof.

         Pursuant to the  requirements of the Securities Act, this  registration
statement has been signed by the following  persons in the capacities and on the
date(s) indicated.

Signature                Title                                 Date

/s/ Dan M. Palmer        Chairman of the Board,                February 22, 2001
-----------------------  Chief Executive Officer, Director
Dan M. Palmer            (Principal Executive Officer)

/s/ Edward T. Haslam     Chief Financial Officer               February 22, 2001
-----------------------  (Principal Financial
Edward T. Haslam         and Accounting Officer)

/s/ Edward A. Labry III  President and Director                February 22, 2001
-----------------------
Edward A. Labry III
                         Director                              February 22, 2001
-----------------------
Douglas C. Altenbern
/s/ Richard Buchignani   Director                              February 22, 2001
-----------------------
Richard Buchignani
/s/ Ronald V. Congemi    Director                              February 22, 2001
-----------------------
Ronald V. Congemi
/s/ Richard M. Harter    Secretary and Director                February 22, 2001
-----------------------
Richard M. Harter
/s/ Joyce Kelso          Director                              February 22, 2001
-----------------------
Joyce Kelso
/s/ Richard P. Kiphart   Director                              February 22, 2001
-----------------------
Richard P. Kiphart
/s/ Jerry D. Mooney      Director                              February 22, 2001
-----------------------
Jerry D. Mooney
/s/ Paul L. Whittington  Director                              February 22, 2001
-----------------------
Paul L. Whittington






<PAGE>



                                  EXHIBIT INDEX

Exhibit No.                                                  Description

4.1  Registrant's  Restated  Certificate of Incorporation is incorporated herein
     by reference to Exhibit 4.1 to the registrant's  registration  statement on
     Form S-8 (File No. 333-74215), filed on March 10, 1999

4.2  Registrant's  Certificate  of  Amendment  to the  Restated  Certificate  of
     Incorporation  is  incorporated  herein  by  reference  to  Exhibit  3.3 to
     amendment  no. 2 to the  registrant's  registration  statement  on Form S-3
     (File No. 333-77829), filed on June 14, 1999

4.3  Registrant's  Amended  and  Restated  Bylaws  are  incorporated  herein  by
     reference to Exhibit 4.2 to the registrant's registration statement on Form
     S-8 (File No. 333-74215), filed on March 10, 1999

*5.1 Opinion of Bingham Dana LLP

*23.1 Consent of Ernst & Young LLP

*23.2 Consent of Bingham Dana LLP  (included in Exhibit 5.1 to this
      registration statement)

*24.1 Powers of Attorney  (included on the  signature  page to this
      registration statement)

*99.1 Star Systems, Inc. 2000 Equity Incentive Plan
---------------------------------
         *        Filed herewith


<PAGE>

                                   EXHIBIT 5.1





                                February 22, 2001

Concord EFS, Inc.
2525 Horizon Lake Drive, Suite 120
Memphis, Tennessee  38133

         Re:      Registration Statement on Form S-8
                  Covering 779,008 Shares of the Common Stock, $.33-1/3
                  Par Value Per Share, of Concord EFS, Inc.,
                  a Delaware corporation ("Concord")

Ladies and Gentlemen:

         We have participated in the preparation of a registration  statement on
Form S-8 (the  "Registration  Statement")  for filing  with the  Securities  and
Exchange Commission covering not more than 779,008 shares (the "Subject Shares")
of  Concord's  Common  Stock,  $.33-1/3  par value per  share  ("Concord  Common
Stock"),  which may be issued by Concord pursuant to the Star Systems, Inc. 2000
Equity Incentive Plan (the "Plan").

         For  purposes  of  rendering  the  opinion  expressed  herein,  we have
examined  Concord's  Certificate of  Incorporation  and all amendments  thereto,
Concord's  by-laws  and  amendments  thereto,  and such of  Concord's  corporate
records as we have  deemed  necessary  for this  opinion.  We have  relied  upon
certificates of public officials and  representations  of Concord  officials and
have assumed  that the  originals of all  documents  examined by us,  whether as
copies or as originals,  are  authentic,  that all documents  submitted to us as
photocopies are exact duplicates of original documents,  and that all signatures
on all documents are genuine.

         Further,  we are familiar with all corporate action taken in connection
with the authorization of the issuance and offering of the Subject Shares.

         Based upon and subject to the  foregoing  and  subsequent  assumptions,
qualifications and exceptions, it is our opinion that:

         1.       Concord is a validly  existing  corporation  under the laws of
                  the State of Delaware  and has all requisite power and author-
                  ity to issue, sell and deliver the Subject Shares; and

         2.       The  Subject  Shares to be issued by Concord  pursuant  to the
                  Plan will have been  duly  authorized  and,  when so issued by
                  Concord, will be fully paid and nonassessable.

         The opinion  expressed  above is limited by the following  assumptions,
qualifications and exceptions:

         (a)      This  opinion  is  limited  solely  to  the  Delaware  General
                  Corporation  Law, the  applicable  provisions  of the Delaware
                  Constitution  and  reported  judicial  decisions  interpreting
                  these laws.

         (b)      We undertake no  responsibility  to update or  supplement  the
                  opinion in the event of any  subsequent  changes in the law or
                  the authorities,  or upon the occurrence after the date hereof
                  of events or  circumstances  that,  if occurring  prior to the
                  date hereof, might have resulted in a different opinion.

         We hereby consent to the filing of this opinion with the Securities and
Exchange Commission.

                                                     Very truly yours,

                                                     /s/ BINGHAM DANA LLP

                                                     BINGHAM DANA LLP


<PAGE>




                                  EXHIBIT 23.1


                         Consent of Independent Auditors

We consent to the incorporation by reference in the Registration Statement (Form
S-8)  pertaining to the Star Systems,  Inc.  2000 Equity  Incentive  Plan of our
report  dated  February 10, 2000,  with  respect to the  consolidated  financial
statements of Concord EFS, Inc.  incorporated  by reference in its Annual Report
(Form 10-K) for the year ended December 31, 1999,  filed with the Securities and
Exchange Commission.



     /s/ Ernst & Young LLP

Memphis, Tennessee
February 20, 2001

<PAGE>

                                  EXHIBIT 99.1




















                               STAR SYSTEMS, INC.

                           2000 EQUITY INCENTIVE PLAN








<PAGE>

                                TABLE OF CONTENTS

SECTION 1.        PURPOSE......................................................1

SECTION 2.        DEFINITIONS..................................................1

SECTION 3.        ADMINISTRATION...............................................4

SECTION 4.        COMMON STOCK SUBJECT TO THE PLAN.............................5

SECTION 5.        ELIGIBILITY TO RECEIVE AWARDS................................6

SECTION 6.        STOCK OPTIONS................................................6

SECTION 7.        STOCK APPRECIATION RIGHTS....................................9

SECTION 8.        RESTRICTED STOCK AWARDS.....................................11

SECTION 9.        STOCK BONUS AWARDS..........................................12

SECTION 10.       LOANS.......................................................13

SECTION 11.       SECURITIES LAW REQUIREMENTS.................................13

SECTION 12.       RESTRICTIONS ON TRANSFER; REPRESENTATIONS OF PARTICIPANT;
                  LEGENDS.....................................................13

SECTION 13.       RIGHT OF REPURCHASE OF VESTED SHARES........................14

SECTION 14.       RIGHT OF FIRST REFUSAL......................................16

SECTION 15.       SINGLE OR MULTIPLE AGREEMENTS...............................17

SECTION 16.       RIGHTS OF A STOCKHOLDER.....................................17

SECTION 17.       NO RIGHT TO CONTINUE EMPLOYMENT OR SERVICE..................17

SECTION 18.       WITHHOLDING.................................................17

SECTION 19.       INDEMNIFICATION.............................................17

SECTION 20.       NON-ASSIGNABILITY...........................................18

SECTION 21.       NONUNIFORM DETERMINATIONS...................................18

SECTION 22.       ADJUSTMENTS.................................................18

SECTION 23.       TERMINATION AND AMENDMENT...................................18

SECTION 24.       SEVERABILITY................................................18

SECTION 25.       FFECT ON OTHER PLANS........................................19

SECTION 26.       EFFECTIVE DATE OF THE PLAN..................................19

SECTION 27.       GOVERNING LAW...............................................19

SECTION 28.       GENDER AND NUMBER...........................................19

SECTION 29.       ACCELERATION OF EXERCISABILITY AND VESTING..................19


<PAGE>

SECTION 30.       MODIFICATION OF AWARDS......................................19

SECTION 31.       NO STRICT CONSTRUCTION......................................19

SECTION 32.       SUCCESSORS..................................................19

SECTION 33.       PLAN PROVISIONS CONTROL.....................................19

SECTION 34.       HEADINGS....................................................20




<PAGE>



                               STAR SYSTEMS, INC.
                           2000 EQUITY INCENTIVE PLAN





Section  1.........Purpose.  The purpose of the Star  Systems,  Inc. 2000 Equity
Incentive  Plan (the  "Plan") is to foster and promote the  long-term  financial
success of Star Systems,  Inc., a Delaware corporation (the "Company"),  and its
Subsidiaries and thereby increase  stockholder  value. The Plan provides for the
award of equity incentives to those directors,  consultants,  advisers, officers
and other  employees who make  substantial  contributions  to the Company or its
Subsidiaries by their loyalty, industry and invention.

Section  2.........Definitions.  For purposes of this Plan, the following  terms
used herein shall have the  following  meanings,  unless a different  meaning is
clearly required by the context.

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

2.2      "Change of Control" means the occurrence of any of the following:

(i)      the Board votes to approve:

(A) any  consolidation  or merger of the Company in which the Company is not the
surviving entity and in which the beneficial owners of 50 percent or more of the
outstanding  voting  securities of the surviving  entity were not the beneficial
owners  of 50  percent  or more of the  outstanding  Common  Stock  prior to the
effective date of such consolidation or merger;

(B) a reverse merger in which the Company is the surviving entity but the shares
of the Company's capital stock  outstanding  immediately prior to the merger are
converted  by virtue of the merger into other  property,  whether in the form of
securities,  cash or otherwise and in which the beneficial  owners of 50 percent
or more of the outstanding  voting  securities of the surviving  entity were not
the  beneficial  owners of 50 percent or more of the  outstanding  Common  Stock
prior to the effective date of such reverse merger;

(C) any sale, lease,  exchange or other transfer (in one transaction or a series
of related  transactions)  of all,  or  substantially  all, of the assets of the
Company other than any sale,  lease,  exchange or other  transfer to any company
where the  Company  owns,  directly  or  indirectly,  at least 70 percent of the
outstanding voting securities of such company after any such transfer;

(D)  any plan or proposal for the liquidation or dissolution of the Company; or

(E) a statutory exchange in which another entity acquires at least 50 percent of
the outstanding  Common Stock of the Company and in which the beneficial  owners
of 50 percent or more of the  outstanding  voting  securities  of the  acquiring
entity were not the beneficial  owners of 50 percent or more of the  outstanding
Common Stock prior to the effective date of such statutory exchange;

(ii) any  person (as such term is used in Section  13(d) of the  Exchange  Act),
other than one or more  trusts  established  by the  Company  for the benefit of
employees of the Company or its subsidiaries,  shall become the beneficial owner
(within the meaning of Rule l3d-3 under the Exchange  Act) of 50 percent or more
of outstanding  Common Stock and was not the  beneficial  owner of 50 percent or
more of the outstanding Common Stock prior to the Effective Date; or
<PAGE>

(iii)  commencement  by any entity,  person,  or group  (including any affiliate
thereof,  other than the Company) of a tender  offer or exchange  offer for more
than 20 percent of the outstanding Common Stock.

2.3      "Code" means the Internal Revenue Code of 1986, as amended.

2.4      "Committee" shall have the meaning provided in Section 3 of the Plan.

2.5      "Common Stock" means the common stock, $.01 par value, of the Company.

2.6 "Continuous  Service" means that the Participant's  service with the Company
or any Subsidiary, or any predecessor of the Company or any Subsidiary,  whether
as an employee,  officer, director, adviser or consultant, is not interrupted or
terminated.  The  Participant's  Continuous  Service shall not be deemed to have
terminated  merely because of a change in the capacity in which the  Participant
renders  service  to the  Company or any  Subsidiary  as an  employee,  officer,
consultant,  adviser  or  director  or a change  in the  entity  for  which  the
Participant  renders such  service,  provided that there is no  interruption  or
termination of the Participant's  Continuous  Service.  For example, a change in
status  from an employee of the Company to a  consultant  of a  Subsidiary  or a
director  will  not  constitute  an  interruption  of  Continuous  Service.  The
Committee,  in that party's sole discretion,  may determine  whether  Continuous
Service  shall be  considered  interrupted  in the case of any leave of  absence
approved  by that  party,  including  sick  leave,  military  leave or any other
personal leave.

2.7  "Disability"  means,  as it relates to the exercise of an  Incentive  Stock
Option after  termination  of  employment,  a  disability  within the meaning of
Section  22(e)(3) of the Code, and for all other purposes,  a mental or physical
condition which, in the opinion of the Committee,  renders a Participant  unable
or incompetent to carry out the job responsibilities which such Participant held
or the tasks to which such  Participant  was assigned at the time the disability
was  incurred,  and  which is  expected  to be  permanent  or for an  indefinite
duration exceeding one year.

2.8   Effective Date" shall have the meaning provided in Section 26 of the Plan.

2.9  "Exchange Act" means the Securities Exchange Act of 1934, as amended.

2.10 "Fair Market Value" means,  as determined by the  Committee,  the last sale
price as quoted on the Nasdaq  National  Market on the trading  day  immediately
preceding  the date for which the  determination  is being made or, in the event
that no such sale takes place on such day, the average of the  reported  closing
bid and asked  prices on such day,  or, if the  Common  Stock of the  Company is
listed on a national  securities  exchange,  the last reported sale price on the
principal  national  securities  exchange on which the Common Stock is listed or
admitted to trading on the trading day immediately  preceding the date for which
the determination is being made or, if no such reported sale takes place on such
day,  the  average  of the  closing  bid and  asked  prices  on such  day on the
principal  national  securities  exchange on which the Common Stock is listed or
admitted  to  trading,  or if the  Common  Stock is not  quoted  on such  Nasdaq
National  Market nor  listed or  admitted  to  trading on a national  securities
exchange,  then the  average  of the  closing  bid and  asked  prices on the day
immediately  preceding the date for which the determination is being made in the
over-the-counter  market as reported  by NASDAQ or, if bid and asked  prices for
the Common Stock on such day shall not have been reported  through  NASDAQ,  the
average  of the bid and asked  prices for such day as  finished  by any New York
Stock  Exchange  member  firm  regularly  making a market  in the  Common  Stock
selected  for such purpose by the Board or a committee  thereof,  or, if none of
the foregoing is  applicable,  then the fair market value of the Common Stock as
determined in good faith by the Committee in its sole discretion.
<PAGE>

2.11 "Incentive  Stock Option" means a stock option granted under the Plan which
is intended to be designated as an "incentive  stock option"  within the meaning
of Section 422 of the Code.

2.12 "Listing  Date" means the first date upon which any security of the Company
is listed (or approved for  listing)  upon notice of issuance on any  securities
exchange or designated (or approved for designation)  upon notice of issuance as
a national market security on an interdealer quotation system.

2.13  "Non-Qualified  Stock Option" means a stock option  granted under the Plan
which is not  intended to be an  Incentive  Stock  Option,  including  any stock
option that provides (as of the time such option is granted) that it will not be
treated  as an  Incentive  Stock  Option nor as an option  described  in Section
423(b) of the Code.

2.14  "Parent"  means any  corporation  (other than the  Company) in an unbroken
chain of corporations ending with the Company if, at the time of the granting of
the option or other award, each of the corporations  other than the Company owns
stock  possessing 50 percent or more of the combined voting power of all classes
of stock in one of the other corporations in the chain.

2.15  "Participant"  shall mean any  employee,  director  or officer  of, or key
adviser or  consultant  to, the  Company or any  Subsidiary  to whom an award is
granted under the Plan.

2.16 "Plan Year" means the twelve-month period beginning on January 1 and ending
on December  31;  provided,  however,  that the first Plan Year shall be a short
Plan Year beginning on the Effective Date and ending on December 31, 2000.

2.17 "Restricted  Stock Award" means an award of shares of Common Stock pursuant
     to Section 8.

2.18 "Stock Appreciation Right" means an award made pursuant to Section 7.

2.19 "Stock Bonus Award" means an award made pursuant to Section 9.

2.20 "Stock Option" means any option to purchase  Common Stock granted  pursuant
     to Section 6.

2.21  "Subsidiary"  means:  (i) as it relates to Incentive  Stock  Options,  any
corporation  (other  than the  Company)  in an  unbroken  chain of  corporations
beginning  with the Company if, at the time of the granting of the option,  each
of the corporations (other than the last corporation in the unbroken chain) owns
stock  possessing 50 percent or more of the total  combined  voting power of all
classes of stock in one of the other corporations in the chain; and (ii) for all
other  purposes,  a  company,  domestic  or  foreign,  of which not less than 50
percent of the total  voting  power is held by the  Company or by a  Subsidiary,
whether or not such company now exists or is hereafter  organized or acquired by
the Company or by a Subsidiary.

2.22 "Term of the Plan" means the period  beginning  on the  Effective  Date and
ending on the  earlier  to occur of (i) the date the Plan is  terminated  by the
Board  in  accordance  with  Section  23 and  (ii)  the  day  before  the  tenth
anniversary of the Effective Date.

Section 3.........Administration. The Plan shall be administered by the Board or
a committee of the Board (as the Board in its sole discretion shall  determine);
provided,  however,  that if the Company  registers any class of equity security
pursuant  to  Section  12  of  the  Exchange  Act,  and  if  the  Plan  is to be
administered  by a committee,  then such committee  shall consist of two or more
members  of the  Board,  each of whom  shall  each  qualify  as a  "Non-employee

<PAGE>

Director"  within the meaning of Rule 16b-3 of the Exchange Act and also qualify
as an "outside  director"  within the meaning of Section  162(m) of the Code and
regulations pursuant thereto. For Purposes of the Plan, the Board acting in this
capacity or the Committee  described in the preceding sentence shall be referred
to as the "Committee". The Committee shall have the power and authority to grant
to eligible  persons  pursuant to the terms of the Plan: (1) Stock Options,  (2)
Stock Appreciation  Rights, (3) Restricted Stock Awards, (4) Stock Bonus Awards,
or (5) any combination of the foregoing.

         The Committee  shall have  authority in its discretion to interpret the
provisions  of the Plan and to  decide  all  questions  of fact  arising  in its
application.  Upon the  recommendation  of the Chief  Executive  Officer  of the
Company, the Committee shall also have the authority in its discretion to select
the persons to whom awards shall be made under the Plan;  to  determine  whether
and to what extent  awards shall be made under the Plan;  to determine the types
of award to be made and the  amount,  size,  terms and  conditions  of each such
award; and to determine the time when the awards shall be granted. The Committee
shall have the authority in its discretion to determine whether,  to what extent
and under what circumstances Common Stock and other amounts payable with respect
to an award  under the Plan shall be  deferred  either  automatically  or at the
election of the  Participant;  to adopt,  alter and repeal  such  administrative
rules, guidelines and practices governing the Plan as it shall from time to time
deem advisable;  and to make all other determinations necessary or advisable for
the  administration  of the Plan.  Notwithstanding  anything  in the Plan to the
contrary,  in the event that the  Committee  determines  that it is advisable to
grant awards  which shall not qualify for the  exception  for  performance-based
compensation  from the tax  deductibility  limitations  of Section 162(m) of the
Code,  the  Committee  may make such grants or awards,  or may amend the Plan to
provide  for such  grants or awards,  without  satisfying  the  requirements  of
Section 162(m) of the Code.

         The Committee  also shall have  authority in its discretion to vary the
terms of the Plan to the extent necessary to comply with federal, state or local
law.

         Notwithstanding  anything in the Plan to the contrary,  with respect to
any Participant or eligible person who is resident outside of the United States,
the Committee may, in its sole discretion,  amend the terms of the Plan in order
to  conform  such  terms  with  the  requirements  of  local  law or to meet the
objectives of the Plan. The Committee may, where  appropriate,  establish one or
more sub-plans for this purpose.

         All decisions  made by the Committee  pursuant to the provisions of the
Plan shall be final and binding on all persons who participate in the Plan.

         All  expenses  and  liabilities   incurred  by  the  Committee  in  the
administration  of the Plan shall be borne by the  Company.  The  Committee  may
employ attorneys,  consultants,  accountants or other persons in connection with
the  administration  of the Plan.  The Company,  and its officers and directors,
shall be entitled to rely upon the advice,  opinions or  valuations  of any such
Persons.

Section 4.........Common Stock Subject to the Plan.
                  --------------------------------

4.1  Share Reserve. There shall be reserved and available for issuance under the
Plan 258,000 shares of Common Stock,  subject to such  adjustment as may be made
pursuant to Section 22.

4.2 Source of Shares/Reversion of Shares. Such shares may consist in whole or in
part of authorized  and unissued  shares or treasury  shares or any  combination
thereof as the Committee may determine. Except as otherwise provided herein, any

<PAGE>

shares  subject  to an  option  or right  which  for any  reason  expires  or is
terminated  unexercised,  becomes  unexercisable,  or is  forfeited or otherwise
terminated, surrendered or canceled as to any shares, or if any shares of Common
Stock are  surrendered  to the Company in connection  with any award (whether or
not such  surrendered  shares were  acquired  pursuant to any award),  or if any
shares are  withheld by the  Company,  the shares  subject to such award and the
surrendered and withheld shares shall thereafter be available for further awards
under the Plan; provided,  however, that any such shares that are surrendered to
or withheld by the Company in  connection  with any award or that are  otherwise
forfeited  after  issuance  shall not be  available  for  purchase  pursuant  to
Incentive Stock Options.  No awards may be granted following the end of the Term
of the Plan.

4.3 Code Section 162(m)  Limitation.  The total number of shares of Common Stock
for  which  (i)  Stock  Options,  (ii)  Stock  Appreciation  Rights,  and  (iii)
Restricted  Stock  Awards  and  Stock  Bonus  Awards  that  are  subject  to the
attainment of performance  criteria to protect against the loss of deductibility
under  Section  162(m) of the Code,  may be granted to any  employee  during any
twelve  month  period  shall not  exceed  129,000 in the  aggregate,  subject to
adjustment pursuant to Section 22. This Section 4.3 shall not apply prior to the
Listing Date and,  following the Listing Date,  this Section 4.3 shall not apply
until (i) the  earliest  of:  (1) the first  material  modification  of the Plan
(including  any  increase in the number of shares of Common  Stock  reserved for
issuance under the Plan in accordance with Section 4.1); (2) the issuance of all
of the shares of Common  Stock  reserved for  issuance  under the Plan;  (3) the
expiration  of the  Plan;  or (4) the first  meeting  of  stockholders  at which
directors  are to be elected that occurs  after the close of the third  calendar
year following the calendar year in which occurred the first  registration of an
equity  security  under  Section 12 of the Exchange Act; or (ii) such other date
required by Section 162(m) of the Code and the rules and regulations promulgated
thereunder.

Section  5.........Eligibility to Receive Awards. An award may be granted to any
employee,  director, or officer of, or key adviser or consultant to, the Company
or any  Subsidiary,  who is responsible  for or  contributes to the  management,
growth or success  of the  Company or any  Subsidiary,  provided  that bona fide
services  shall be  rendered  by  consultants  or advisers to the Company or its
Subsidiaries and such services must not be in connection with the offer and sale
of  securities  in a  capital-raising  transaction  and  must  not  directly  or
indirectly promote or maintain a market for the Company's securities.  The Chief
Executive  Officer of the Company shall recommend to the Committee those persons
to whom an award should be granted,  the type of award that should be granted to
each such person and the size, terms and conditions of each such award.  Subject
to the preceding  sentences of this Section 5, the Committee shall have the sole
authority to select the persons to whom an award is to be granted  hereunder and
to determine what type of award is to be granted to each such person.  No person
shall have any right to  participate  in the Plan.  Any person  selected  by the
Committee  for  participation  during any one period  will not by virtue of such
participation  have the  right to be  selected  as a  Participant  for any other
period.

Section 6.........Stock Options. A Stock Option may be an Incentive Stock Option
or a Non-Qualified  Stock Option. Only employees of the Company or any Parent or
Subsidiary of the Company are eligible to receive  Incentive  Stock Options.  To
the extent that any Stock Option does not qualify as an Incentive  Stock Option,
it shall constitute a separate  Non-Qualified Stock Option. Stock Options may be
granted alone or in addition to other awards  granted under the Plan.  The terms
and conditions of each Stock Option granted under the Plan shall be specified by
the  Committee,  in its sole  discretion,  and  shall be set  forth in a written
option  agreement  between the Company and the  Participant  in such form as the
Committee shall approve from time to time. No person shall have any rights under
any Stock  Option  granted  under the Plan  unless and until the Company and the

<PAGE>

person to whom such Stock Option shall have been granted shall have executed and
delivered  an agreement  expressly  granting the Stock Option to such person and
containing  provisions  setting forth the terms for the Stock Option.  The terms
and conditions of each Incentive  Stock Option shall be such that each Incentive
Stock  Option  issued  hereunder  shall  constitute  and shall be  treated as an
"incentive  stock  option" as defined in Section 422 of the Code.  The terms and
conditions  of  each   Non-Qualified   Stock  Option  will  be  such  that  each
Non-Qualified  Stock Option issued hereunder shall not constitute nor be treated
as an  "incentive  stock  option" as  defined  in Section  422 of the Code or an
option  described  in  Section  423(b) of the Code and will be a  "non-qualified
stock option" for federal  income tax purposes.  The terms and conditions of any
Stock Option granted hereunder need not be identical to those of any other Stock
Option  granted  hereunder.  The  agreements  shall  contain  in  substance  the
following  terms  and  conditions  and may  contain  such  additional  terms and
conditions,  not inconsistent with the terms of the Plan, as the Committee shall
deem desirable:

6.1 Type of Option.  Each option agreement shall identify the option represented
thereby as an Incentive  Stock Option or a  Non-Qualified  Stock Option,  as the
case may be.

6.2  Option  Price.  The  Stock  Option  exercise  price  shall  be fixed by the
Committee  but shall in no event be less than 100 percent (or 110 percent in the
case of an Incentive Stock Option granted to an employee  referred to in Section
6.8(ii) below) of the Fair Market Value of the shares of Common Stock subject to
the Stock Option on the date the Stock Option is granted.

6.3 Exercise Term.  Each option  agreement  shall state the period or periods of
time within which the Stock Option may be exercised,  in whole or in part, which
shall be such period or periods of time as may be determined  by the  Committee,
provided that no Stock Option shall be exercisable after ten years from the date
of grant  thereof  (or, in the case of an Incentive  Stock Option  granted to an
employee  referred  to in  Section  6.8(ii)  below,  such term shall in no event
exceed  five (5) years from the date on which  such  Incentive  Stock  Option is
granted);  provided  further,  each option  granted  under the Plan shall become
exercisable six (6) months after the grant date, unless specifically  stipulated
otherwise  under the option  agreement.  The  Committee  shall have the power to
permit an acceleration of previously  established exercise terms, subject to the
requirements set forth herein, upon such circumstances and subject to such terms
and conditions as the Committee deems appropriate.

6.4 Payment for Shares.  A Stock  Option  shall be deemed to be  exercised  when
written notice of such exercise has been given to the Company in accordance with
the terms of the option  agreement by the  Participant  entitled to exercise the
Stock  Option and full  payment for the shares of Common  Stock with  respect to
which the Stock  Option is  exercised  has been  received  by the  Company.  The
Committee, in its sole discretion,  may permit all or part of the payment of the
exercise  price to be made, to the extent  permitted by applicable  statutes and
regulations,  either:  (i) in cash,  by check or wire  transfer,  or (ii) in any
other form of legal  consideration  as provided for under the terms of the Stock
Option.  No shares  of Common  Stock  shall be  issued to any  Participant  upon
exercise of a Stock Option until the Company  receives full payment  therefor as
described above. Upon the receipt of notice of exercise and full payment for the
shares of Common Stock,  the shares of Common Stock shall be deemed to have been
issued and the  Participant  shall be entitled to receive  such shares of Common
Stock and shall be a stockholder with respect to such shares,  and the shares of
Common Stock shall be  considered  fully paid and  nonassessable.  No adjustment
will be made for a dividend or other right for which the record date is prior to
the date on which the stock is issued,  except as  provided in Section 22 of the
Plan.  Each  exercise of a Stock Option shall reduce,  by an equal  number,  the
total number of shares of Common Stock that may  thereafter  be purchased  under
such Stock Option.
<PAGE>

6.5 Rights upon Termination of Continuous  Service or Change of Control.  Except
as  otherwise  provided  below  in  this  Section  6.5,  in  the  event  that  a
Participant's  Continuous  Service  terminates for any reason, any rights of the
Participant  under any  Stock  Option  shall  immediately  terminate;  provided,
however, the Participant (or any successor or legal  representative)  shall have
the right to exercise  the Stock  Option to the extent that the Stock Option was
exercisable at the time of termination,  until the earlier of (i) the date three
(3) months after the effective date of such  termination of Continuous  Service,
or  such  other  date as  otherwise  determined  by the  Committee  in its  sole
discretion, or (ii) the expiration of the term of the Stock Option.

         If the Board  determines in its sole discretion that the  Participant's
Continuous  Service has been  terminated for "cause" (as such term is defined in
the Participant's  Stock Option  agreement) or if the  Participant's  Continuous
Service is  terminated  by reason of the  Participant's  voluntary  quitting  or
resignation  prior to his or her  completion of 20 years of Continuous  Service,
the Participant (or any successor or legal  representative)  shall only have the
right to  exercise  the Stock  Option to the  extent  that the Stock  Option was
exercisable at the time of termination, until the earlier of (i) the date thirty
(30) days after the effective date of such termination of Continuous Service, or
such other date as determined by the Committee in its sole  discretion,  or (ii)
the expiration of the term of the Stock Option.

         In the event  that  prior to the  expiration  of the Stock  Option  and
without  the   Participant's   having  fully  exercised  the  Stock  Option,   a
Participant's  Continuous  Service  terminates  because such  Participant  dies,
suffers a Disability or retires at or after attaining age 55 and completing five
(5)  years  of  Continuous  Service,  or the  Participant's  Continuous  Service
terminates  for any reason  (other than  termination  for cause) on or after the
date the Participant  completes 20 years of Continuous Service,  the Participant
or his  successor  or legal  representative  shall be fully  vested in the Stock
Option and shall have the right to exercise  the Stock  Option until the earlier
of (i) the date six (6) months following such termination of Continuous Service,
or such other date as  determined by the  Committee in its sole  discretion,  or
(ii) the expiration of the term of the Stock Option.

         In the  event  of a  Change  of  Control  upon or  prior  to the date a
Participant's  Continuous  Service  terminates,  the Participant  shall be fully
vested  in the Stock  Option,  and the  Participant  or his  successor  or legal
representative  shall  have the right to  exercise  the Stock  Option  until the
earlier of (i) the date six (6) months  after the  effective  date of his or her
termination  of  Continuous  Service  for  any  reason,  or such  other  date as
determined by the Committee in its sole  discretion,  or (ii) the  expiration of
the term of the Stock Option.

6.6 Exercise of Unvested Options.  The Stock Option agreement may, but need not,
include a  provision  whereby the  Participant  may elect at any time before the
Participant's  Continuous  Service terminates to exercise the Stock Option as to
any part or all of the shares of Common Stock  subject to the Stock Option prior
to the full vesting of the Stock Option.  Without limiting the generality of the
foregoing, the Committee may provide that if the Stock Option is exercised prior
to having fully vested, shares issued upon such exercise shall remain subject to
vesting  at the same rate as under the Stock  Option so  exercised  and shall be
subject to a right,  but not an  obligation,  of  repurchase by the Company with
respect  to all  unvested  Shares  or to any  other  restriction  the  Committee
determines to be appropriate.  For purposes of  facilitating  the enforcement of
any such right of repurchase,  at the request of the Committee,  the Participant
shall enter into joint  escrow  instructions  with the Company and deliver  each
certificate  for his or her unvested  shares of Common Stock with a stock power,
duly  endorsed in blank.  The  Company's  rights under this Section 6.6 shall be
freely assignable, in whole or in part.
<PAGE>

6.7 Re-load Options.  Without in any way limiting the authority of the Committee
to make or not to make grants of Stock Options  hereunder,  the Committee  shall
have the  authority  (but not an  obligation)  to  include  as part of any Stock
Option a  provision  entitling  the  Participant  to a further  Stock  Option (a
"Re-Load  Option") in the event the  Participant  exercises  the original  Stock
Option,  in whole or in part,  by  surrendering  other shares of Common Stock in
accordance with this Plan and the terms and conditions of the Stock Option.  Any
such  Re-Load  Option  shall (i) provide for a number of shares of Common  Stock
equal to the number of shares of Common Stock  surrendered as part or all of the
exercise price of such Stock Option;  (ii) have an expiration  date which is the
same as the expiration  date of the Stock Option the exercise of which gave rise
to such Re-Load  Option;  and (iii) have an exercise price which is equal to 100
percent of the Fair  Market  Value of the Common  Stock  subject to the  Re-Load
Option on the date of exercise of the original Stock Option. Notwithstanding the
foregoing, a Re-Load Option shall be subject to the same exercise price and term
provisions heretofore described for Stock Options under the Plan.

         Any  such  Re-Load  Option  may  be  an  Incentive  Stock  Option  or a
Non-Qualified  Stock  Option,  as the Committee may designate at the time of the
grant of the original Stock Option;  provided,  however,  the designation of any
Re-Load  Option as an  Incentive  Stock  Option shall be subject to the $100,000
annual limitation on the  exercisability of Incentive Stock Options described in
Section 6.7 and in Section 422(d) of the Code. There shall be no Re-Load Options
on  a  Re-Load  Option.  Any  such  Re-Load  Option  shall  be  subject  to  the
availability  of  sufficient  shares of Common  Stock under  Section 4.1 and the
limitation on the grants of Stock Options under Section 4.3 and shall be subject
to such other terms and conditions as the Committee may determine  which are not
inconsistent  with the express  provisions  of the Plan  regarding  the terms of
Stock Options.

6.8 Special Incentive Stock Option Rules.  Notwithstanding the foregoing, in the
case of an Incentive  Stock  Option,  each option  agreement  shall contain such
other terms,  conditions and provisions as the Committee determines necessary or
desirable in order to qualify  such Stock  Option as an  Incentive  Stock Option
under the Code including, without limitation, the following:

(i) To the extent that the  aggregate  Fair Market Value  (determined  as of the
time the option is granted) of the Common Stock, with respect to which Incentive
Stock  Options  granted  under this Plan (and all other plans of the Company and
its Subsidiaries and Parent) become exercisable for the first time by any person
in any  calendar  year,  exceeds  $100,000,  such  options  shall be  treated as
Non-Qualified Stock Options.

(ii) No Incentive  Stock Option shall be granted to any employee if, at the time
the  Incentive  Stock  Option  is  granted,  the  employee  (by  reason  of  the
attribution rules applicable under Section 424(d) of the Code) owns more than 10
percent of the  combined  voting power of all classes of stock of the Company or
any  Parent or  Subsidiary  unless at the time such  Incentive  Stock  Option is
granted  the  option  price is at least 110  percent  of the Fair  Market  Value
(determined as of the time the Incentive  Stock Option is granted) of the shares
of Common Stock subject to the Incentive  Stock Option and such Incentive  Stock
Option by its terms is not  exercisable  after the expiration of five years from
the date of grant.

If an Incentive  Stock Option is exercised  after the expiration of the exercise
periods  that apply for  purposes of Section 422 of the Code,  such Stock Option
shall thereafter be treated as a Non-Qualified Stock Option.

Section  7.........Stock  Appreciation Rights. Stock Appreciation Rights entitle
Participants  to increases  in the Fair Market Value of shares of Common  Stock.
The terms and conditions of each Stock Appreciation Right granted under the Plan

<PAGE>

shall be specified by the Committee,  in its sole  discretion,  and shall be set
forth in a written  agreement  between the Company and the  Participant  in such
form as the Committee  shall  approve from time to time.  The  agreements  shall
contain in substance the  following  terms and  conditions  and may contain such
additional terms and conditions, not inconsistent with the terms of the Plan, as
the Committee shall deem desirable:

7.1 Award. Stock Appreciation  Rights shall entitle the Participant,  subject to
such terms and conditions determined by the Committee,  to receive upon exercise
thereof an award equal to all or a portion of the excess of: (i) the Fair Market
Value of a specified  number of shares of Common  Stock at the time of exercise,
over (ii) a specified price which shall not be less than 100 percent of the Fair
Market  Value  of the  Common  Stock at the time the  right is  granted  or,  if
connected  with a previously  issued Stock Option,  not less than 100 percent of
the Fair  Market  Value of the Common  Stock at the time such  Stock  Option was
granted. Such amount may be paid by the Company in cash, Common Stock (valued at
its then Fair Market  Value) or any  combination  thereof,  as the Committee may
determine. Stock Appreciation Rights may be, but are not required to be, granted
in connection with a previously or  contemporaneously  granted Stock Option.  In
the event of the exercise of a Stock  Appreciation  Right,  the number of shares
reserved for issuance hereunder shall be reduced by the number of shares covered
by the Stock Appreciation Right.

7.2 Term.  Each agreement shall state the period or periods of time within which
the Stock Appreciation  Right may be exercised,  in whole or in part, subject to
such terms and conditions  prescribed for such purpose by the Committee provided
that no Stock  Appreciation  Right shall be exercisable  prior to six months nor
after ten years from the date of grant  thereof.  The  Committee  shall have the
power to  permit an  acceleration  of  previously  established  exercise  terms,
subject  to the  requirements  set forth  herein,  upon such  circumstances  and
subject to such terms and conditions as the Committee deems appropriate.

7.3 Rights upon Termination of Continuous  Service or Change of Control.  Except
as  otherwise  provided  below  in  this  Section  7.3,  in  the  event  that  a
Participant's  Continuous  Service  terminates for any reason, any rights of the
Participant  under any Stock  Appreciation  Right shall  immediately  terminate;
provided,  however,  the Participant (or any successor or legal  representative)
shall have the right to exercise the Stock Appreciation Right to the extent that
the Stock Appreciation  Right was exercisable at the time of termination,  until
the earlier of (i) the date three (3) months  after the  effective  date of such
termination of Continuous Service, or such other date as otherwise determined by
the Committee in its sole discretion,  or (ii) the expiration of the term of the
Stock Appreciation Right.

         If the Board  determines in its sole discretion that the  Participant's
Continuous  Service has been  terminated for "cause" (as such term is defined in
the Participant's  Stock  Appreciation  Right agreement) or if the Participant's
Continuous  Service  is  terminated  by  reason of the  Participant's  voluntary
quitting or resignation prior to his or her completion of 20 years of Continuous
Service, the Participant (or any successor or legal  representative)  shall only
have the right to exercise the Stock  Appreciation  Right to the extent that the
Stock Appreciation  Right was exercisable at the time of termination,  until the
earlier  of (i) the date  thirty  (30)  days  after the  effective  date of such
termination  of  Continuous  Service,  or such other date as  determined  by the
Committee  in its sole  discretion,  or (ii) the  expiration  of the term of the
Stock Appreciation Right.

         In the event that  prior to the  expiration  of his Stock  Appreciation
Right and  without  having  fully  exercised  his Stock  Appreciation  Right,  a
Participant's  Continuous  Service  terminates  because such  Participant  dies,
suffers a Disability,  or retires at or after  attaining  age 55 and  completing
five (5) years of Continuous  Service,  or the Participant's  Continuous Service

<PAGE>

terminates  for any  reason  (other  than  termination  for  cause)  on or after
completing 20 years of Continuous  Service,  the Participant or his successor or
legal  representative  shall be fully vested in the Stock Appreciation Right and
shall have the right to exercise the Stock  Appreciation Right until the earlier
of (i) the date six (6) months following such termination of Continuous Service,
or such other date as  determined by the  Committee in its sole  discretion,  or
(ii) the expiration of the term of the Stock Appreciation Right.

         In the event of a Change of Control  prior to the date a  Participant's
Continuous  Service  terminates,  the  Participant  shall be fully vested in the
Stock  Appreciation  Right,  and  the  Participant  or his  successor  or  legal
representative  shall have the right to exercise  the Stock  Appreciation  Right
until the earlier of (i) the date six (6) months after the effective date of his
or her  termination of Continuous  Service,  or such other date as determined by
the Committee in its sole discretion,  or (ii) the expiration of the term of the
Stock Appreciation Right.

Section 8.........Restricted Stock Awards. Restricted Stock Awards shall consist
of shares of Common Stock restricted against transfer  ("Restricted  Stock") and
subject to a substantial  risk of  forfeiture.  The terms and conditions of each
Restricted  Stock  Award  granted  under  the  Plan  shall be  specified  by the
Committee, in its sole discretion, and shall be set forth in a written agreement
between the  Company and the  Participant  in such form as the  Committee  shall
approve  from time to time.  The  agreements  shall  contain  in  substance  the
following  terms  and  conditions  and may  contain  such  additional  terms and
conditions,  not inconsistent with the terms of the Plan, as the Committee shall
deem desirable.

8.1  Vesting   Period.   Restricted   Stock  Awards  shall  be  subject  to  the
above-described   restrictions   over  such  vesting  period  as  the  Committee
determines.  To the extent the  Committee  deems  necessary  or  appropriate  to
protect  against loss of  deductibility  pursuant to Section 162(m) of the Code,
Restricted  Stock  Awards to any  Participant  may also be  subject  to  certain
conditions with respect to attainment of one or more preestablished  performance
objectives which shall relate to corporate,  subsidiary, division, group or unit
performance in terms of growth in gross revenue, earnings per share or ratios of
earnings to equity or assets, net profits,  stock price,  market share, sales or
costs;  provided  that such  objectives  may be adjusted by the Committee in its
sole discretion to reduce or eliminate,  but not to increase,  an award in order
to take into account unforeseen events or changes in circumstances.

8.2 Restriction upon Transfer. Shares awarded, and the right to vote such shares
and to  receive  dividends  thereon,  may not be  sold,  assigned,  transferred,
exchanged,  pledged,  hypothecated  or  otherwise  encumbered,  except as herein
provided or as provided in any agreement  entered into between the Company and a
Participant in connection with the Plan, during the vesting period applicable to
such shares.  Notwithstanding the foregoing, and except as otherwise provided in
the Plan,  the  Participant  shall  have all the other  rights of a  stockholder
including,  but not limited to, the right to receive  dividends and the right to
vote such shares,  until such time as the Participant  disposes of the shares or
forfeits the shares pursuant to the agreement  relating to the Restricted  Stock
Award.

8.3 Certificates. Any stock certificate issued in respect of shares awarded to a
Participant  shall be  registered in the name of the  Participant  and deposited
with the Company, or its designee, and shall bear the following legend:

                  "This certificate and the shares of stock  represented  hereby
                  are subject to the terms and conditions  (including forfeiture
                  provisions and restrictions against transfer) contained in the
                  Star Systems, Inc. 2000 Equity Incentive Plan and a Restricted
                  Stock Award  Agreement  entered  into  between the  registered

<PAGE>

                  owner and Star  Systems,  Inc.  Release  from  such  terms and
                  conditions  shall  be  obtained  only in  accordance  with the
                  provisions of the Plan and Agreement,  a copy of each of which
                  is on file in the  office of the  Secretary  of Star  Systems,
                  Inc."

Each  Participant,  as a condition of any  Restricted  Stock  Award,  shall have
delivered a stock power, endorsed in blank, relating to the Common Stock covered
by such award.

8.4 Termination of Continuous Service or Change of Control.  Except as otherwise
provided in the written agreement relating to the Participant's Restricted Stock
Award, in the event that a Participant's  Continuous  Service terminates for any
reason,  other than death or  Disability,  any rights of the  Participant or his
successors  or legal  representatives  under any  Restricted  Stock  Award  that
remains subject to restrictions  shall immediately  terminate and any Restricted
Stock Award with unlapsed restrictions shall be forfeited to the Company without
payment of any consideration.

         Unless the written  agreement  between the  Participant and the Company
relating to the Restricted Stock Award provides  otherwise,  in the event that a
Participant's  Continuous  Service  terminates  because such Participant dies or
suffers a  Disability,  or in the event of a Change of Control prior to the date
the  Participant's  Continuous  Service  terminates,  all remaining  shares of a
Restricted Stock Award shall no longer be subject to any unlapsed restrictions.

Section  9.........Stock  Bonus  Awards.  To  the  extent  the  Committee  deems
necessary or appropriate to protect against the loss of  deductibility  pursuant
to Section 162(m) of the Code, the Committee may, in its sole discretion,  grant
a Stock Bonus Award based upon corporate,  division,  subsidiary,  group or unit
performance in terms of growth in gross revenue, earnings per share or ratios of
earnings to equity or assets, net profits,  stock price,  market share, sales or
costs or, with  respect to  Participants  not  subject to Section  162(m) of the
Code,  such other  measures or  standards  determined  by the  Committee  in its
discretion; provided, that such performance objectives may be adjusted to reduce
or  eliminate  but not to  increase  an  award in  order  to take  into  account
unforeseen events or changes in circumstances.

         The terms and  conditions  of each Stock Bonus Award  granted under the
Plan shall be specified by the Committee,  in its sole discretion,  and shall be
set forth in a written agreement between the Company and the Participant in such
form as the  Committee  shall  approve  from time to time.  In  addition  to any
applicable  performance  goals,  shares of Common Stock subject to a Stock Bonus
Award  may be:  (i)  subject  to  additional  restrictions  (including,  without
limitation, restrictions on transfer), or (ii) granted directly to a person free
of any  restrictions,  not  inconsistent  with  the  terms of the  Plan,  as the
Committee shall deem desirable.

Section  10........Loans.  The  Committee  may,  in its sole  discretion  and to
further the purpose of the Plan, provide for loans to persons in connection with
all or any part of an award  under the  Plan.  Any loan  made  pursuant  to this
Section 10 shall be  evidenced  by a loan  agreement,  promissory  note or other
instruments  in such form and which  shall  contain  such  terms and  conditions
(including,  without limitation,  provisions for interest,  payment,  schedules,
collateral,  forgiveness,  acceleration  of  such  loans  or  parts  thereof  or
acceleration  in the event of termination) as the Committee shall prescribe from
time to time.  Notwithstanding  the  foregoing,  each loan shall comply with all
applicable laws,  regulations and rules of the Board of Governors of the Federal
Reserve System and any other governmental agency having jurisdiction.

Section  11........Securities Law Requirements.  No shares of Common Stock shall
be issued upon the exercise or payment of any award unless and until:
<PAGE>

(i) The shares of Common Stock  underlying the award have been registered  under
the  Securities  Act of  1933,  as  amended  (the  "Act"),  or the  Company  has
determined that an exemption from the registration requirements under the Act is
available  or the  registration  requirements  of the Act do not  apply  to such
exercise or payment;

(ii) The Company has determined that all applicable listing  requirements of any
stock  exchange  or  quotation  system on which the  shares of Common  Stock are
listed have been satisfied; and

(iii) The Company has determined that any other applicable provision of state or
Federal law, including without limitation  applicable state securities laws, has
been satisfied.

Section  12........Restrictions  on Transfer;  Representations  of  Participant;
Legends.
        -----------------------------------------------------------------

         Until  the  Common  Stock is  listed on any  United  States  securities
exchange  or traded on NASDAQ  or an  over-the-counter  quotation  system in the
United States, the shares of Common Stock issued to a Participant under the Plan
may not be sold, transferred or otherwise disposed of by the Participant (or his
or her successor or legal  representative)  for 180 days  following the date the
shares are both issued to the Participant and fully vested,  and such shares may
only be sold to a  stockholder  of the  Company  who is not an  employee  of the
Company or any  Subsidiary or Parent.  The Committee in its sole  discretion may
further restrict the  transferability of shares until the Common Stock is listed
on  any  United   States   securities   exchange  or  traded  on  NASDAQ  or  an
over-the-counter quotation system in the United States.

         Regardless  of whether the  offering and sale of shares of Common Stock
has been registered under the Securities Act or has been registered or qualified
under the securities laws of any state, the Company may impose restrictions upon
the sale,  pledge, or other transfer of such shares,  including the placement of
appropriate  legends on stock  certificates,  if, in the judgment of the Company
and its  counsel,  such  restrictions  are  necessary  or  desirable in order to
achieve  compliance  with the provisions of the  Securities  Act, the securities
laws of any state, or any other law. As a condition to the Participant's receipt
of shares, the Company may require the Participant to represent that such shares
are  being  acquired  for  investment,  and  not  with a view  to  the  sale  or
distribution thereof,  except in compliance with the Securities Act, and to make
other  representations as are deemed necessary or appropriate by the Company and
its  counsel.  Stock  certificates  evidencing  shares  acquired  pursuant to an
unregistered  transaction  to which the  Securities  Act  applies  shall  bear a
restrictive   legend   substantially  in  the  following  form  and  such  other
restrictive  legends as are required or deemed  advisable  under the Plan or the
provisions of any applicable law:

                  "THE  SHARES  REPRESENTED  BY THIS  CERTIFICATE  HAVE NOT BEEN
                  REGISTERED  UNDER THE  SECURITIES ACT OF 1933, AS AMENDED (THE
                  "ACT"),  OR QUALIFIED  UNDER THE SECURITIES LAWS OF ANY STATE.
                  THESE SHARES HAVE BEEN ACQUIRED FOR  INVESTMENT AND NOT WITH A
                  VIEW  TO OR FOR  SALE  IN  CONNECTION  WITH  ANY  DISTRIBUTION
                  THEREOF, AND MAY NOT BE SOLD, MORTGAGED, PLEDGED, HYPOTHECATED
                  OR OTHERWISE  TRANSFERRED  WITHOUT AN  EFFECTIVE  REGISTRATION
                  UNDER THE ACT AND  QUALIFICATION  UNDER ANY  APPLICABLE  STATE
                  SECURITIES  LAWS, OR WITHOUT AN OPINION OF COUNSEL  ACCEPTABLE
                  TO THE  COMPANY  AND ITS  COUNSEL  THAT SUCH  REGISTRATION  OR
                  QUALIFICATION IS NOT REQUIRED."

The Company  shall also place  legends on stock  certificates  representing  its

<PAGE>

right of  repurchase  under  Sections  6.6 and 13 hereof  and the right of first
refusal  under  Section 14 hereof.  Any  determination  by the  Company  and its
counsel in connection with any of the matters set forth in this Section 12 shall
be conclusive and binding on all persons.

         The Company may, but shall not be obligated to, register or qualify the
sale of shares under the Securities Act or any other applicable law.

Section 13........Right of Repurchase of Vested Shares.
                  ------------------------------------

13.1 Repurchase  Right. At the  Committee's  discretion,  shares of Common Stock
issued to a  Participant  under this Plan may be subject to a right,  but not an
obligation,  of  repurchase by the Company (the "Right of  Repurchase"),  at the
price specified in Section 13.2 below, if the Participant's  Continuous  Service
terminates  for any  reason  ("Employment  Termination").  Shares  issued by the
Company shall be transferable  only by the  Participant  subject to the Right of
Repurchase,  and the Company  shall legend the Right of  Repurchase on the stock
certificates  evidencing such shares and shall take such other steps as it deems
necessary to ensure compliance with this restriction. The Company's rights under
this  Section  13.1 shall be in addition  to, and not in lieu of, the  Company's
right of  repurchase  under  Section 6.6 of any  unvested  shares  issued to the
Participant,  and the  Company's  rights under this Section 13.1 shall be freely
assignable, in whole or in part.

13.2 Repurchase Price. The price per share at which the Company may exercise the
Right of Repurchase under
         -----------------
Section 13.1 (the "Repurchase Price") shall be:

                  (a) the Fair Market Value of each share at the effective  date
of the  Participant's  Employment  Termination  (or, in the case of Common Stock
issued  upon  exercise  of the  Stock  Option  after the  effective  date of the
Participant's Employment Termination, the Fair Market Value of each share at the
date of exercise of such Stock Option); or

                  (b) such other price as the  Committee in its sole  discretion
shall determine in accordance with applicable state Blue Sky or other laws.

13.3 Repurchase  Procedure.  The Company may exercise its Right of Repurchase by
sending a written  notice to the  Participant  or his or her  successor or legal
representative  and to the escrow  agent,  if any, of its taking such action and
specifying  the  number of shares  being  repurchased.  The  Company's  Right of
Repurchase  shall  terminate if not exercised by written notice from the Company
to the Participant or his or her successor or legal representative within thirty
(30) days of the effective date of the Employment  Termination  (or, in the case
of Common  Stock issued upon  exercise of the Stock  Option after the  effective
date of the Participant's Employment Termination, within thirty (30) days of the
date of exercise of such Stock  Option).  If the Company  exercises its Right of
Repurchase,  within ninety (90) days of the effective date of the  Participant's
Employment  Termination (or, in the case of Common Stock issued upon exercise of
the  Stock  Option  after the  effective  date of the  Participant's  Employment
Termination,   within  ninety  (90)  days  after  the  date  of  exercise),  the
Participant, or his or her successor or legal representative,  or if applicable,
the  escrow  agent,  shall  deliver  to  the  Company  every  stock  certificate
representing the shares being repurchased, together with appropriate assignments
separate  from  certificates,  and the Company shall then promptly pay the total
Repurchase  Price in cash to the  Participant,  or if applicable,  to the escrow
agent, for delivery to the Participant.

13.4 Escrow. To facilitate the consummation of the Company's Right of Repurchase
under this Section 13, at the request of the Committee,  the Participant and the

<PAGE>

Company  shall  execute  joint escrow  instructions  and the  Participant  shall
deliver and deposit with the escrow agent named in the joint escrow instructions
all  certificates  for the  shares of  Common  Stock  issued to the  Participant
pursuant to the Plan with a stock  power,  duly  endorsed  in blank.  The escrow
agent shall hold such documents and deliver the same to the Company  pursuant to
the joint escrow  instructions  and in accordance with the terms of this Section
13, as applicable.

13.5 Binding  Effect.  The  Company's  Right of  Repurchase  shall  inure to the
     benefit of its successors and ---------------  assigns and shall be binding
     upon any representative,  executor, administrator,  heir, or legatee of the
     Participant.

13.6 Termination of Right of Repurchase.  Notwithstanding any other provision of
this  Section  13, in the event  that the  Common  Stock is listed on any United
States securities exchange or traded on NASDAQ or an over-the-counter  quotation
system in the  United  States at the time the  Participant  would  otherwise  be
required  to  transfer  his or her shares of Common  Stock to the  Company,  the
Company  shall no  longer  have the Right of  Repurchase  with  respect  to such
shares, and the Participant shall have no obligation to comply with this Section
13 with respect to such shares.

Section 14........Right of First Refusal.
                  ----------------------

14.1 Right of First Refusal. At the Committee's  discretion,  shares issued to a
Participant  under  this  Plan  may be  subject  to a  requirement  that  if the
Participant  proposes to sell,  pledge, or otherwise transfer any such shares or
any interest in such shares,  to any person or entity,  the Company shall have a
right of first  refusal  (the  "Right of First  Refusal")  with  respect to such
shares.  Any  Participant  desiring to transfer  shares  subject to the Right of
First Refusal shall give a written notice (the "Transfer Notice") to the Company
describing fully the proposed transfer,  including the number of shares proposed
to be transferred,  the proposed transfer price, and the name and address of the
proposed transferee. The Transfer Notice shall be signed both by the Participant
and by the proposed  transferee and must constitute a binding commitment of both
parties to the  transfer  of the  shares.  The  Company  shall have the right to
purchase all (but not less than all) the shares  subject to the Transfer  Notice
on the terms of the proposal referred to in the Transfer Notice,  subject to any
change in such terms  permitted  under  Section  14.2  hereof,  by delivery of a
notice of exercise of the Right of First  Refusal  within thirty (30) days after
the date the Transfer  Notice is received by the Company.  The Company's  rights
under this Section 14.1 shall be freely assignable, in whole or in part.

14.2  Transfer of Shares.  If the Company  fails to exercise  the Right of First
Refusal within thirty (30) days after the date on which it receives the Transfer
Notice,  the Participant may, not later than six (6) months following receipt of
the Transfer Notice by the Company,  consummate a transfer of the shares subject
to the  Transfer  Notice on the terms and  conditions  described in the Transfer
Notice,  subject to restrictions on the transfer of such shares imposed pursuant
to Section 12. Any  proposed  transfer on terms and  conditions  different  from
those  described  in the Transfer  Notice,  as well as any  subsequent  proposed
transfer  by the  Participant,  shall  again be  subject  to the  Right of First
Refusal and shall again  require  compliance  with the  procedure  described  in
Section  14.1.  If the  Company  exercises  its  Right  of  First  Refusal,  the
Participant  shall  immediately  endorse and deliver to the Company  every stock
certificate  representing the shares being purchased, and the Company shall then
promptly pay the purchase price in accordance with Section 14.3.

14.3  Repurchase  Payment.  The amount payable to a Participant  pursuant to the
Company's  exercise  of  the  Right  of  First  Refusal  shall  be  paid  to the
Participant in accordance  with the terms and conditions of the Transfer  Notice

<PAGE>

or may, at the election of the Company, be paid in three equal installments with
the first  installment  due and payable on the first date (the "Transfer  Notice
Date") that any payment would otherwise be payable to the  Participant  pursuant
to the terms and  conditions  of the  Transfer  Notice,  and with an  additional
installment   thereof   due  and  payable  on  each  of  the  first  and  second
anniversaries  of the Transfer Notice Date,  together with interest on each such
installment,  for the period from the  Transfer  Notice Date until the date such
installment  is paid, at the prime rate as published in The Wall Street  Journal
on the Transfer  Notice Date or, if The Wall Street  Journal is not published on
such date, on the first day  thereafter  that the prime rate is published in The
Wall Street Journal.

14.4 Binding  Effect.  The  Company's  Right of First Refusal shall inure to the
benefit of its  successors  and assigns and shall be binding upon any transferee
of the shares,  other than a transferee  acquiring  shares in a transaction with
respect to which the Company  failed to exercise  its Right of First  Refusal (a
"Free Transferee") or a transferee of a Free Transferee.

14.5 Termination of Right of First Refusal.  Notwithstanding any other provision
of this  Section  14,  if the  Common  Stock  is  listed  on any  United  States
securities exchange or traded on NASDAQ or an over-the-counter  quotation system
in the United States at the time the Participant  desires to transfer his or her
shares,  the Company  shall no longer have the Right of First  Refusal,  and the
Participant shall have no obligation to comply with this Section 14.

Section  15........Single  or Multiple  Agreements.  Multiple forms of awards or
combinations  thereof  may  be  evidenced  by a  single  agreement  or  multiple
agreements, as determined by the Committee.

Section 16........Rights of a Stockholder.  The recipient of any award under the
Plan,  unless  otherwise  provided  by the  Plan,  shall  have  no  rights  as a
stockholder  with  respect  thereto  unless and until shares of Common Stock are
issued to him.

Section  17........No  Right to Continue  Employment or Service.  Nothing in the
Plan or any instrument  executed or award granted  pursuant thereto shall confer
upon  any  Participant  any  right  to  continue  to serve  the  Company  or any
Subsidiary  in the capacity in effect at the time the award was granted or shall
affect  the  right  of the  Company  or any  Subsidiary  to  terminate  (i)  the
employment of an employee with or without notice and with or without cause, (ii)
the  service  of  a  consultant  or  adviser  pursuant  to  the  terms  of  such
consultant's or adviser's  agreement with the Company or any Subsidiary or (iii)
the  service  of a  director  pursuant  to  the  Bylaws  of the  Company  or any
Subsidiary  and any  applicable  provisions of the corporate law of the state in
which the Company or any Subsidiary is incorporated, as the case may be.

Section 18........Withholding. The Company's obligation to (i) deliver shares of
Common Stock or pay cash upon the exercise of any Non-Qualified  Stock Option or
any  Stock  Appreciation  Right  granted  under  the Plan,  (ii)  deliver  stock
certificates  upon the vesting of any Restricted  Stock Award, and (iii) deliver
shares of Common  Stock upon the grant of any Stock Bonus Award shall be subject
to applicable  foreign,  federal,  state and local withholding tax requirements.
Foreign,  federal,  state and local  withholding  tax due under the terms of the
Plan may be paid in cash or shares of Common Stock (either through the surrender
of previously held shares of Common Stock or the withholding of shares of Common
Stock  otherwise  issuable  upon the exercise or payment of such award) having a
Fair Market  Value equal to the required  withholding  and upon such other terms
and  conditions  as  the  Committee  shall  determine;  provided,  however,  the
Committee, in its sole discretion,  may require that such taxes be paid in cash;
and provided, further, any election by a Participant subject to Section 16(b) of
the Exchange Act to pay his  withholding  tax in shares of Common Stock shall be
subject to and must comply with Rule 16b-3 of the Exchange Act.
<PAGE>

Section 19........Indemnification.  No member of the Board or the Committee, nor
any  officer or  employee of the  Company or a  Subsidiary  or Parent  acting on
behalf of the Board or the Committee, shall be personally liable for any action,
determination or interpretation  taken or made in good faith with respect to the
Plan,  and all members of the Board or the Committee and each and any officer or
employee  of the  Company or any  Subsidiary  or Parent  acting on their  behalf
shall, to the extent permitted by law, be fully indemnified and protected by the
Company in respect of any such action, determination or interpretation.

Section 20........Non-Assignability. No award under the Plan shall be assignable
or transferable by the recipient  thereof except by will, by the laws of descent
and  distribution and by such other means as the Committee may approve from time
to time.  No right or  benefit  hereunder  shall in any manner be subject to the
debts,  contracts,  liabilities or torts of the person entitled to such right or
benefit.

Section  21........Nonuniform  Determinations.  The  Committee's  determinations
under the Plan (including  without  limitation  determinations of the persons to
receive  awards,  the form,  amount  and  timing of such  awards,  the terms and
provisions  of  such  awards  and  the  agreements   evidencing  same,  and  the
establishment of values and performance  targets) need not be uniform and may be
made by it  selectively  among persons who receive,  or are eligible to receive,
awards under the Plan, whether or not such persons are similarly situated.

Section  22........Adjustments.  In the event of any  change in the  outstanding
shares of Common Stock,  without the receipt of consideration by the Company, by
reason of a stock dividend,  stock split,  reverse stock split or  distribution,
recapitalization,  merger,  reorganization,   reclassification,   consolidation,
split-up, spin-off, combination of shares, exchange of shares or other change in
corporate  structure affecting the Common Stock and not involving the receipt of
consideration by the Company,  the Committee shall make appropriate  adjustments
in (a) the aggregate  number of shares of Common Stock (i) reserved for issuance
under the Plan,  (ii) for which grants or awards may be made to any  Participant
and (iii) covered by outstanding unexercised awards and grants, (b) the exercise
or other  applicable  price related to outstanding  awards or grants and (c) the
appropriate  Fair  Market  Value  and other  price  determinations  relevant  to
outstanding  awards or grants and shall make such  other  adjustments  as may be
appropriate under the circumstances; provided, that the number of shares subject
to any award or grant always shall be a whole number.

Section  23........Termination  and Amendment.  The Board may terminate or amend
the Plan or any portion thereof at any time and the Committee may amend the Plan
to the extent provided in Section 3, without approval of the stockholders of the
Company,  unless stockholder  approval is required by Rule 16b-3 of the Exchange
Act,  applicable  stock  exchange  or NASDAQ or other  quotation  system  rules,
applicable  Code  provisions,  or  other  applicable  laws  or  regulations.  No
amendment,  termination  or  modification  of the Plan  shall  affect  any award
theretofore  granted in any  material  adverse  way  without  the consent of the
recipient.

Section 24........Severability.  If any of the terms or provisions of this Plan,
or awards made under this Plan, conflict with the requirements of Section 162(m)
or Section  422 of the Code with  respect to awards  subject to or  governed  by
Section 162(m) or Section 422 of the Code,  then such terms or provisions  shall
be deemed  inoperative to the extent they so conflict with the  requirements  of
Section  162(m) or Section 422 of the Code.  With respect to an Incentive  Stock
Option,  if this Plan does not  contain  any  provision  required to be included
herein under  Section 422 of the Code (as the same shall be amended from time to
time),  such provision shall be deemed to be  incorporated  herein with the same
force and effect as if such provision had been set out herein.


<PAGE>

Section  25........Effect  on Other Plans.  Participation in this Plan shall not
affect  an  employee's  eligibility  to  participate  in any  other  benefit  or
incentive  plan of the Company or any Subsidiary and any awards made pursuant to
this Plan shall not be used in determining the benefits provided under any other
plan of the Company or any Subsidiary unless specifically provided.

Section 26........Effective Date of the Plan. The Plan shall become effective as
determined  by the Board,  but no Stock Option  shall be exercised  and no other
awards  shall be  granted  unless  and until the Plan has been  approved  by the
stockholders  of the Company,  which approval shall be within twelve (12) months
before or after the date the Plan is adopted by the Board.

Section  27........Governing  Law.  This  Plan and all  agreements  executed  in
connection with the Plan shall be governed by, and construed in accordance with,
the laws of the  State of  Delaware,  without  regard  to its  conflicts  of law
doctrine.

Section  28........Gender  and Number. Words denoting the masculine gender shall
include the  feminine  gender,  and words  denoting  the  feminine  gender shall
include the  masculine  gender.  Words in the plural shall include the singular,
and the singular shall include the plural.

Section  29........Acceleration  of  Exercisability  and Vesting.  The Committee
shall  have the  power to  accelerate  the time at which an award  may  first be
exercised  or the time during  which an award or any part  thereof  will vest in
accordance  with the Plan,  notwithstanding  the provisions in the award stating
the time at which it may first be  exercised  or the time  during  which it will
vest.

Section 30........Modification of Awards. Within the limitations of the Plan and
subject to Section 22, the Committee may modify outstanding awards or accept the
cancellation   of  outstanding   awards  for  the  granting  of  new  awards  in
substitution  therefor.  Notwithstanding the preceding sentence,  except for any
adjustment  described in Section 22, no modification of an award shall,  without
the consent of the Participant,  alter or impair any rights or obligations under
any award previously  granted under the Plan in any material adverse way without
the affected Participant's consent.

Section 31........No Strict  Construction.  No rule of strict construction shall
be applied  against  the  Company,  the  Committee,  or any other  person in the
interpretation  of any of the  terms of the  Plan,  any  agreement  executed  in
connection  with the Plan,  any  award  granted  under  the  Plan,  or any rule,
regulation or procedure established by the Committee.

Section  32........Successors.  This Plan is  binding  on and will  inure to the
benefit  of  any   successor  to  the   Company,   whether  by  way  of  merger,
consolidation, purchase, or otherwise.

Section  33........Plan  Provisions  Control.  The terms of the Plan  govern all
awards granted under the Plan, and in no event will the Committee have the power
to grant any award under the Plan which is contrary to any of the  provisions of
the Plan.  In the event any  provision of any award granted under the Plan shall
conflict with any term in the Plan, the term in the Plan shall control.

Section  34........Headings.  The headings used in the Plan are for  convenience
only,  do not  constitute a part of the Plan,  and shall not be deemed to limit,
characterize,  or  affect  in any  way  any  provisions  of the  Plan,  and  all
provisions of the Plan shall be construed as if no captions had been used in the
Plan.
[{"type": "S-8", "sequence": "1", "filename": "0001.txt", "description": "REGISTRATION STATEMENT", "secsgml_size_bytes": 99879}]
{"company-data": {"conformed-name": "CONCORD EFS INC", "cik": "0000740112", "assigned-sic": "6099", "irs-number": "042462252", "state-of-incorporation": "DE", "fiscal-year-end": "1231"}, "filing-values": {"form-type": "S-8", "act": "33", "file-number": "333-56066", "film-number": "1552485"}, "business-address": {"street1": "2525 HORIZON LAKE DR STE 120", "city": "MEMPHIS", "state": "TN", "zip": "38133", "phone": "9013718000"}, "mail-address": {"street1": "2525 HORIZON LAKE DRIVE", "street2": "SUITE 120", "city": "MEMPHIS", "state": "TN", "zip": "38133"}, "former-company": {"former-conformed-name": "CONCORD COMPUTING CORP", "date-changed": "19920515"}}
Registration No. ____________

================================================================================

                       SECURITIES AND EXCHANGE COMMISSION
                             Washington, D.C. 20549
                          -----------------------------

                                    FORM S-8
                             REGISTRATION STATEMENT
                        UNDER THE SECURITIES ACT OF 1933
                          -----------------------------

                                Concord EFS, Inc.
             (Exact Name of Registrant as Specified in its Charter)
                          -----------------------------

                               Delaware 04-2462252
                (State or Other Jurisdiction of (I.R.S. Employer
               Incorporation or Organization) Identification No.)

                             2525 Horizon Lake Drive
                                    Suite 120
                            Memphis, Tennessee 38133
               (Address of Principle Executive Offices) (Zip Code)

                               Star Systems, Inc.
                           2000 Equity Incentive Plan
                            (Full Title of the Plan)
                          -----------------------------

                                Thomas J. Dowling
                      Senior Vice President and Controller
                                Concord EFS, Inc.
          2525 Horizon Lake Drive, Suite 120, Memphis, Tennessee 38133
                                 (901) 371-8000
 (Name, Address and Telephone Number, Including Area Code, of Agent for Service)

                                 With Copies to:
                    Richard M. Harter, Esq., Bingham Dana LLP
                 150 Federal Street, Boston, Massachusetts 02110
                                 (617) 951-8415

                         CALCULATION OF REGISTRATION FEE
--------------------------- -------------------------- -------------------- ------------------- --------------
   Title Of Securities       Amount To Be Registered    Proposed Maximum     Proposed Maximum     Amount Of
     To Be Registered                                  Offering Price Per       Aggregate       Registration
                                                              Share           Offering Price         Fee
--------------------------- -------------------------- -------------------- ------------------- --------------
--------------------------- -------------------------- -------------------- ------------------- --------------
      Common Stock,            779,008 shares (1)          $ 10.21 (2)      $ 7,953,671.68 (2)   $ 1,988.42
   $0.33 1/3 par value
--------------------------- -------------------------- -------------------- ------------------- --------------
(1)  Shares  issuable  under options  granted under the Star Systems,  Inc. 2000
     Equity Incentive Plan.

(2)  Calculated in accordance  with Rule 457(h)(1)  under  Regulation C based on
     the price at which the options may be exercised.
PART I

              INFORMATION REQUIRED IN THE SECTION 10(a) PROSPECTUS

Item 1.  Plan Information.*

Item 2.  Registrant Information and Employee Plan Annual Information.*

* This  registration  statement  relates to securities  of the  registrant to be
offered  pursuant to the Star  Systems,  Inc.  2000 Equity  Incentive  Plan,  as
indicated  on the facing  sheet  hereof.  Information  required  by Part I to be
contained in the Section 10(a)  prospectus  related to this plan is omitted from
this registration statement in accordance with Rule 428 under the Securities Act
of 1933, as amended ("Securities Act"), and the Note to Part I of Form S-8.

                                     PART II

               INFORMATION REQUIRED IN THE REGISTRATION STATEMENT

Item 3.  Incorporation of Documents by Reference.

         The following documents are incorporated by reference herein:

1.   The registrant's annual report on Form 10-K for the year ended December 31,
     1999;

2.   The  registrant's  quarterly  reports on Form 10-Q for the  quarters  ended
     March 31, June 30 and September 30, 2000;

3.   The registrant's  current reports on Form 8-K filed with the Securities and
     Exchange Commission ("SEC") on October 10, 2000 and February 15, 2001;

4.   The  description  of the current  management  and board of directors of the
     registrant  contained  in  the  proxy  statement  of the  registrant  filed
     pursuant to Section 14(a) of the Securities Exchange Act of 1934 ("Exchange
     Act") for the registrant's annual meeting of shareholders to be held on May
     25, 2000; and

5.   The description of the registrant's common stock contained in Amendment No.
     1 to the registration  statement on Form S-4 filed with the SEC on June 27,
     2000,  including  any amendment or report filed for the purpose of updating
     such description.

         All  documents  filed by the  registrant  pursuant to  Sections  13(a),
13(c), 14 or 15(d) of the Exchange Act, as amended (the "Exchange  Act"),  after
the  date  of  this  registration  statement  and  prior  to  the  filing  of  a
post-effective amendment which indicates that all securities offered hereby have
been sold or which deregisters all securities then remaining unsold,  are deemed
to be  incorporated  by reference into this  registration  statement and to be a
part  hereof  from  the  respective  dates of  filing  of such  documents  (such
documents,  and the documents enumerated above, being hereinafter referred to as
"Incorporated Documents").

         Any statement contained in an Incorporated  Document shall be deemed to
be modified or  superseded  for purposes of this  registration  statement to the
extent  that a statement  contained  herein or in any other  subsequently  filed
Incorporated Document modifies or supersedes such statement.  Any such statement
so  modified  or  superseded  shall  not be  deemed,  except as so  modified  or
superseded, to constitute a part of this registration statement.
Item 4.  Description of Securities.

         Not Required

Item 5.  Interests of Named Experts and Counsel.

         The legality of the securities being registered  hereby has been passed
upon for the  registrant  by  Bingham  Dana LLP,  150  Federal  Street,  Boston,
Massachusetts  02110.  Richard M.  Harter,  a partner of Bingham  Dana LLP, is a
Director  and  Secretary  of the  registrant  and  owns  139,550  shares  of the
registrant's common stock,  including 46,000 shares subject to unexercised stock
options.

Item 6.  Indemnification of Directors and Officers.

         Section  145  of  the   Delaware   General   Corporation   Law  permits
indemnification of officers and directors under certain conditions.

         Article   SEVENTH  of  the   registrant's   Restated   Certificate   of
         Incorporation, as amended, provides:
         No  director  of the  Corporation  shall be  personally  liable  to the
         Corporation  or to any of its  stockholders  for  monetary  damages for
         breach of fiduciary duty as a director,  notwithstanding  any provision
         of law imposing such liability;  provided,  however, that to the extent
         required  from time to time by  applicable  law,  this Article  Seventh
         shall not eliminate or limit the liability of a director, to the extent
         such liability is provided by applicable law, (i) for any breach of the
         director's duty of loyalty to the Corporation or its stockholders, (ii)
         for acts or omissions  not in good faith or which  involve  intentional
         misconduct  or a knowing  violation of law,  (iii) under Section 174 of
         Title 8 of the Delaware Code, or (iv) for any  transactions  from which
         the director derived an improper personal  benefit.  No amendment to or
         repeal of this Article Seventh shall apply to or have any effect on the
         liability  or alleged  liability of any director for or with respect to
         any acts or omissions of such director occurring prior to the effective
         date of such amendment or repeal.

         Article VII of the registrant's By-Laws provides:

         SECTION 7.1 RIGHT TO INDEMNIFICATION.  Each person who was or is made a
         party or is threatened  to be made a party to or is otherwise  involved
         in  any  action,   suit  or  proceeding,   whether   civil,   criminal,
         administrative or investigative (a "Proceeding"), by reason of being or
         having  been a director  or officer  of the  Corporation  or serving or
         having served at the request of the Corporation as a director, trustee,
         officer,  employee or agent of another corporation or of a partnership,
         joint  venture,  trust  or other  enterprise,  including  service  with
         respect to an  employee  benefit  plan (an  "Indemnitee"),  whether the
         basis of such  proceeding  is  alleged  action or  failure to act in an
         official capacity as a director, trustee, officer, employee or agent or
         in any other  capacity while serving as a director,  trustee,  officer,
         employee  or  agent,  shall be  indemnified  and held  harmless  by the
         Corporation  to the fullest extent  authorized by the Delaware  General
         Corporation  Law, as the same exists or may  hereafter be amended (but,
         in the  case of any  such  amendment,  only  to the  extent  that  such
         amendment  permits the Corporation to provide  broader  indemnification
         rights than permitted  prior thereto) (as used in this Article VII, the
         "Delaware  Law"),  against all expense,  liability and loss  (including
attorneys' fees, judgments,  fines, ERISA excise taxes or penalties and
         amounts  paid in  settlement)  reasonably  incurred or suffered by such
         Indemnitee  in  connection  therewith  and such  indemnification  shall
         continue as to an Indemnitee who has ceased to be a director,  trustee,
         officer,  employee  or agent  and  shall  inure to the  benefit  of the
         Indemnitee's heirs,  executors and administrators;  PROVIDED,  HOWEVER,
         that,  except as  provided  in  Section  7.2  hereof  with  respect  to
         Proceedings to enforce rights to indemnification, the Corporation shall
         indemnify any such  Indemnitee in connection with a Proceeding (or part
         thereof)  initiated by such Indemnitee only if such Proceeding (or part
         thereof) was  authorized by the board of directors of the  Corporation.
         The right to  indemnification  conferred in this Article VII shall be a
         contract  right  and  shall  include  the  right  to  be  paid  by  the
         Corporation  the expenses  incurred in defending any such Proceeding in
         advance  of its  final  disposition  (an  "Advancement  of  Expenses");
         PROVIDED,   HOWEVER,  that,  if  the  Delaware  Law  so  requires,  and
         Advancement  of Expenses  incurred by an Indemnitee  shall be made only
         upon delivery to the Corporation of an undertaking (an  "Undertaking"),
         by or on behalf of such Indemnitee, to repay all amounts so advanced if
         it shall ultimately be determined by final judicial decision from which
         there is no further right to appeal (a "Final  Adjudication") that such
         Indemnitee is not entitled to be  indemnified  for such expenses  under
         this Article VII or otherwise.

         The  registrant  also  maintains  an  insurance  policy  which  insures
directors and officers of the registrant against certain liabilities which might
be incurred in connection with the performance of their duties.

Item 7.  Exemption from Registration Claimed.

         Not required

Item 8.  Exhibits.

Exhibit No.                                                  Description

4.1  Registrant's  Restated  Certificate of Incorporation is incorporated herein
     by reference to Exhibit 4.1 to the registrant's  registration  statement on
     Form S-8 (File No. 333-74215), filed on March 10, 1999

4.2  Registrant's  Certificate  of  Amendment  to the  Restated  Certificate  of
     Incorporation  is  incorporated  herein  by  reference  to  Exhibit  3.3 to
     amendment  no. 2 to the  registrant's  registration  statement  on Form S-3
     (File No. 333-77829), filed on June 14, 1999

4.3  Registrant's  Amended  and  Restated  Bylaws  are  incorporated  herein  by
     reference to Exhibit 4.2 to the registrant's registration statement on Form
     S-8 (File No. 333-74215), filed on March 10, 1999

*5.1 Opinion of Bingham Dana LLP

*23.1 Consent of Ernst & Young LLP

*23.2  Consent of Bingham Dana LLP(included in Exhibit 5.1 to this  registration
       statement)

*24.1  Powers of Attorney (included on the  signature  page to this registration
       statement)

*99.1  Star Systems, Inc. 2000 Equity Incentive Plan
---------------------------------
         *        Filed herewith
Item 9.  Undertakings.

(a)      The undersigned registrant hereby undertakes:

         To file,  during any period in which  offers or sales are being made, a
         post-effective amendment to this registration statement:

               To include any  prospectus  required  by Section  10(a)(3) of the
               Securities Act;

                           To  reflect  in the  prospectus  any  facts or events
                  arising  after  the  effective   date  of  this   registration
                  statement  (or  the  most  recent   post-effective   amendment
                  thereof) which, individually or in the aggregate,  represent a
                  fundamental  change  in the  information  set  forth  in  this
                  registration  statement.  Notwithstanding  the foregoing,  any
                  increase or decrease in volume of  securities  offered (if the
                  total dollar value of securities offered would not exceed that
                  which was  registered)  and any deviation from the low or high
                  end of the estimated  maximum  offering range may be reflected
                  in the form of prospectus  filed with the SEC pursuant to Rule
                  424(b) if, in the  aggregate,  the changes in volume and price
                  represent  no more than a 20  percent  change  in the  maximum
                  aggregate  offering  price  set forth in the  "Calculation  of
                  Registration   Fee"  table  in  the   effective   registration
                  statement;

                           To include any material  information  with respect to
                  the plan of  distribution  not  previously  disclosed  in this
                  registration   statement  or  any  material   change  to  such
                  information in this registration statement;

                           That,  for the purpose of  determining  any liability
         under the Securities Act, each such  post-effective  amendment shall be
         deemed to be a new  registration  statement  relating to the securities
         offered therein, and the offering of such securities at that time shall
         be deemed to be the initial bona fide offering thereof.

                  To  remove  from  registration  by means  of a  post-effective
         amendment any of the securities being registered which remain unsold at
         the termination of the offering.

(b)  The  undersigned   registrant  hereby  undertakes  that,  for  purposes  of
determining  any  liability  under  the  Securities  Act,  each  filing  of  the
registrant's  annual  report  pursuant to Section 13(a) or 15(d) of the Exchange
Act (and,  where  applicable,  each filing of an employee  benefit plan's annual
report  pursuant to Section 15(d) of the Exchange Act ) that is  incorporated by
reference  in  this  registration   statement  shall  be  deemed  to  be  a  new
registration  statement  relating to the  securities  offered  therein,  and the
offering of such  securities at that time shall be deemed to be the initial bona
fide offering thereof.

(c) Insofar as indemnification  for liabilities arising under the Securities Act
may  be  permitted  to  directors,  officers  and  controlling  persons  of  the
registrant pursuant to the foregoing  provisions,  or otherwise,  the registrant
has been advised that in the opinion of the SEC such  indemnification is against
public  policy  as  expressed  in  the   Securities   Act  and  is,   therefore,
unenforceable.  In the  event  that a claim  for  indemnification  against  such
liabilities  (other than the payment by the  registrant of expenses  incurred or
paid by a  director,  officer or  controlling  person of the  registrant  in the
successful  defense of any  action,  suit or  proceeding)  is  asserted  by such
director,  officer or controlling person in connection with the securities being
registered, the registrant will, unless in the opinion of its counsel the matter
has been  settled by  controlling  precedent,  submit to a court of  appropriate
jurisdiction the question whether such  indemnification  by it is against public
policy as  expressed  in the  Securities  Act and will be  governed by the final
adjudication of such issue.
SIGNATURES

         Pursuant to the  requirements  of the  Securities  Act, the  registrant
certifies  that it has  reasonable  grounds to believe  that it meets all of the
requirements  for  filing  on Form S-8 and has  duly  caused  this  registration
statement  to be  signed  on its  behalf  by  the  undersigned,  thereunto  duly
authorized,  in the city of  Memphis,  State of  Tennessee,  on this 22nd day of
February, 2001.

     CONCORD EFS, INC.

     By: /s/ Dan M. Palmer
     --------------------------------------
     Dan M. Palmer
     Chairman of the Board of Directors and
     Chief Executive Officer
KNOW  ALL MEN BY THESE  PRESENTS,  that  each  person  whose  signature
appears below  constitutes and appoints Thomas J. Dowling and William E. Lucado,
and each of them,  with the power to act without the other,  his or her true and
lawful  attorneys-in-fact  and  agents,  with  full  power of  substitution  and
resubstitution,  for him or her and in his or her name,  place and stead, in any
and all  capacities,  to sign any and all amendments  (including  post-effective
amendments)  to this  registration  statement,  and to file the  same,  with all
exhibits  thereto  and  other  documents  in  connection  therewith,   with  the
Securities and Exchange  Commission,  granting unto said  attorneys-in-fact  and
agents,  and each of them,  full power and  authority to do and perform each and
every  act and  thing  requisite  and  necessary  to be done  in and  about  the
premises,  as fully as and to all  intents  and  purposes  as he or she might or
could do in  person,  hereby  ratifying  and  confirming  all that  each of said
attorneys-in-fact and agents, or his substitute or substitutes,  may lawfully do
and cause to be done by virtue hereof.

         Pursuant to the  requirements of the Securities Act, this  registration
statement has been signed by the following  persons in the capacities and on the
date(s) indicated.

Signature                Title                                 Date

/s/ Dan M. Palmer        Chairman of the Board,                February 22, 2001
-----------------------  Chief Executive Officer, Director
Dan M. Palmer            (Principal Executive Officer)

/s/ Edward T. Haslam     Chief Financial Officer               February 22, 2001
-----------------------  (Principal Financial
Edward T. Haslam         and Accounting Officer)

/s/ Edward A. Labry III  President and Director                February 22, 2001
-----------------------
Edward A. Labry III
                         Director                              February 22, 2001
-----------------------
Douglas C. Altenbern
/s/ Richard Buchignani   Director                              February 22, 2001
-----------------------
Richard Buchignani
/s/ Ronald V. Congemi    Director                              February 22, 2001
-----------------------
Ronald V. Congemi
/s/ Richard M. Harter    Secretary and Director                February 22, 2001
-----------------------
Richard M. Harter
/s/ Joyce Kelso          Director                              February 22, 2001
-----------------------
Joyce Kelso
/s/ Richard P. Kiphart   Director                              February 22, 2001
-----------------------
Richard P. Kiphart
/s/ Jerry D. Mooney      Director                              February 22, 2001
-----------------------
Jerry D. Mooney
/s/ Paul L. Whittington  Director                              February 22, 2001
-----------------------
Paul L. Whittington
EXHIBIT INDEX

Exhibit No.                                                  Description

4.1  Registrant's  Restated  Certificate of Incorporation is incorporated herein
     by reference to Exhibit 4.1 to the registrant's  registration  statement on
     Form S-8 (File No. 333-74215), filed on March 10, 1999

4.2  Registrant's  Certificate  of  Amendment  to the  Restated  Certificate  of
     Incorporation  is  incorporated  herein  by  reference  to  Exhibit  3.3 to
     amendment  no. 2 to the  registrant's  registration  statement  on Form S-3
     (File No. 333-77829), filed on June 14, 1999

4.3  Registrant's  Amended  and  Restated  Bylaws  are  incorporated  herein  by
     reference to Exhibit 4.2 to the registrant's registration statement on Form
     S-8 (File No. 333-74215), filed on March 10, 1999

*5.1 Opinion of Bingham Dana LLP

*23.1 Consent of Ernst & Young LLP

*23.2 Consent of Bingham Dana LLP  (included in Exhibit 5.1 to this
      registration statement)

*24.1 Powers of Attorney  (included on the  signature  page to this
      registration statement)

*99.1 Star Systems, Inc. 2000 Equity Incentive Plan
---------------------------------
         *        Filed herewith
EXHIBIT 5.1

                                February 22, 2001

Concord EFS, Inc.
2525 Horizon Lake Drive, Suite 120
Memphis, Tennessee  38133

         Re:      Registration Statement on Form S-8
                  Covering 779,008 Shares of the Common Stock, $.33-1/3
                  Par Value Per Share, of Concord EFS, Inc.,
                  a Delaware corporation ("Concord")

Ladies and Gentlemen:

         We have participated in the preparation of a registration  statement on
Form S-8 (the  "Registration  Statement")  for filing  with the  Securities  and
Exchange Commission covering not more than 779,008 shares (the "Subject Shares")
of  Concord's  Common  Stock,  $.33-1/3  par value per  share  ("Concord  Common
Stock"),  which may be issued by Concord pursuant to the Star Systems, Inc. 2000
Equity Incentive Plan (the "Plan").

         For  purposes  of  rendering  the  opinion  expressed  herein,  we have
examined  Concord's  Certificate of  Incorporation  and all amendments  thereto,
Concord's  by-laws  and  amendments  thereto,  and such of  Concord's  corporate
records as we have  deemed  necessary  for this  opinion.  We have  relied  upon
certificates of public officials and  representations  of Concord  officials and
have assumed  that the  originals of all  documents  examined by us,  whether as
copies or as originals,  are  authentic,  that all documents  submitted to us as
photocopies are exact duplicates of original documents,  and that all signatures
on all documents are genuine.

         Further,  we are familiar with all corporate action taken in connection
with the authorization of the issuance and offering of the Subject Shares.

         Based upon and subject to the  foregoing  and  subsequent  assumptions,
qualifications and exceptions, it is our opinion that:

         1.       Concord is a validly  existing  corporation  under the laws of
                  the State of Delaware  and has all requisite power and author-
                  ity to issue, sell and deliver the Subject Shares; and

         2.       The  Subject  Shares to be issued by Concord  pursuant  to the
                  Plan will have been  duly  authorized  and,  when so issued by
                  Concord, will be fully paid and nonassessable.

         The opinion  expressed  above is limited by the following  assumptions,
qualifications and exceptions:

         (a)      This  opinion  is  limited  solely  to  the  Delaware  General
                  Corporation  Law, the  applicable  provisions  of the Delaware
                  Constitution  and  reported  judicial  decisions  interpreting
                  these laws.

         (b)      We undertake no  responsibility  to update or  supplement  the
                  opinion in the event of any  subsequent  changes in the law or
                  the authorities,  or upon the occurrence after the date hereof
                  of events or  circumstances  that,  if occurring  prior to the
                  date hereof, might have resulted in a different opinion.

         We hereby consent to the filing of this opinion with the Securities and
Exchange Commission.

                                                     Very truly yours,

                                                     /s/ BINGHAM DANA LLP

                                                     BINGHAM DANA LLP
EXHIBIT 23.1

                         Consent of Independent Auditors

We consent to the incorporation by reference in the Registration Statement (Form
S-8)  pertaining to the Star Systems,  Inc.  2000 Equity  Incentive  Plan of our
report  dated  February 10, 2000,  with  respect to the  consolidated  financial
statements of Concord EFS, Inc.  incorporated  by reference in its Annual Report
(Form 10-K) for the year ended December 31, 1999,  filed with the Securities and
Exchange Commission.

     /s/ Ernst & Young LLP

Memphis, Tennessee
February 20, 2001
EXHIBIT 99.1

                               STAR SYSTEMS, INC.

                           2000 EQUITY INCENTIVE PLAN
TABLE OF CONTENTS

SECTION 1.        PURPOSE......................................................1

SECTION 2.        DEFINITIONS..................................................1

SECTION 3.        ADMINISTRATION...............................................4

SECTION 4.        COMMON STOCK SUBJECT TO THE PLAN.............................5

SECTION 5.        ELIGIBILITY TO RECEIVE AWARDS................................6

SECTION 6.        STOCK OPTIONS................................................6

SECTION 7.        STOCK APPRECIATION RIGHTS....................................9

SECTION 8.        RESTRICTED STOCK AWARDS.....................................11

SECTION 9.        STOCK BONUS AWARDS..........................................12

SECTION 10.       LOANS.......................................................13

SECTION 11.       SECURITIES LAW REQUIREMENTS.................................13

SECTION 12.       RESTRICTIONS ON TRANSFER; REPRESENTATIONS OF PARTICIPANT;
                  LEGENDS.....................................................13

SECTION 13.       RIGHT OF REPURCHASE OF VESTED SHARES........................14

SECTION 14.       RIGHT OF FIRST REFUSAL......................................16

SECTION 15.       SINGLE OR MULTIPLE AGREEMENTS...............................17

SECTION 16.       RIGHTS OF A STOCKHOLDER.....................................17

SECTION 17.       NO RIGHT TO CONTINUE EMPLOYMENT OR SERVICE..................17

SECTION 18.       WITHHOLDING.................................................17

SECTION 19.       INDEMNIFICATION.............................................17

SECTION 20.       NON-ASSIGNABILITY...........................................18

SECTION 21.       NONUNIFORM DETERMINATIONS...................................18

SECTION 22.       ADJUSTMENTS.................................................18

SECTION 23.       TERMINATION AND AMENDMENT...................................18

SECTION 24.       SEVERABILITY................................................18

SECTION 25.       FFECT ON OTHER PLANS........................................19

SECTION 26.       EFFECTIVE DATE OF THE PLAN..................................19

SECTION 27.       GOVERNING LAW...............................................19

SECTION 28.       GENDER AND NUMBER...........................................19

SECTION 29.       ACCELERATION OF EXERCISABILITY AND VESTING..................19
SECTION 30.       MODIFICATION OF AWARDS......................................19

SECTION 31.       NO STRICT CONSTRUCTION......................................19

SECTION 32.       SUCCESSORS..................................................19

SECTION 33.       PLAN PROVISIONS CONTROL.....................................19

SECTION 34.       HEADINGS....................................................20
STAR SYSTEMS, INC.
                           2000 EQUITY INCENTIVE PLAN

Section  1.........Purpose.  The purpose of the Star  Systems,  Inc. 2000 Equity
Incentive  Plan (the  "Plan") is to foster and promote the  long-term  financial
success of Star Systems,  Inc., a Delaware corporation (the "Company"),  and its
Subsidiaries and thereby increase  stockholder  value. The Plan provides for the
award of equity incentives to those directors,  consultants,  advisers, officers
and other  employees who make  substantial  contributions  to the Company or its
Subsidiaries by their loyalty, industry and invention.

Section  2.........Definitions.  For purposes of this Plan, the following  terms
used herein shall have the  following  meanings,  unless a different  meaning is
clearly required by the context.

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

2.2      "Change of Control" means the occurrence of any of the following:

(i)      the Board votes to approve:

(A) any  consolidation  or merger of the Company in which the Company is not the
surviving entity and in which the beneficial owners of 50 percent or more of the
outstanding  voting  securities of the surviving  entity were not the beneficial
owners  of 50  percent  or more of the  outstanding  Common  Stock  prior to the
effective date of such consolidation or merger;

(B) a reverse merger in which the Company is the surviving entity but the shares
of the Company's capital stock  outstanding  immediately prior to the merger are
converted  by virtue of the merger into other  property,  whether in the form of
securities,  cash or otherwise and in which the beneficial  owners of 50 percent
or more of the outstanding  voting  securities of the surviving  entity were not
the  beneficial  owners of 50 percent or more of the  outstanding  Common  Stock
prior to the effective date of such reverse merger;

(C) any sale, lease,  exchange or other transfer (in one transaction or a series
of related  transactions)  of all,  or  substantially  all, of the assets of the
Company other than any sale,  lease,  exchange or other  transfer to any company
where the  Company  owns,  directly  or  indirectly,  at least 70 percent of the
outstanding voting securities of such company after any such transfer;

(D)  any plan or proposal for the liquidation or dissolution of the Company; or

(E) a statutory exchange in which another entity acquires at least 50 percent of
the outstanding  Common Stock of the Company and in which the beneficial  owners
of 50 percent or more of the  outstanding  voting  securities  of the  acquiring
entity were not the beneficial  owners of 50 percent or more of the  outstanding
Common Stock prior to the effective date of such statutory exchange;

(ii) any  person (as such term is used in Section  13(d) of the  Exchange  Act),
other than one or more  trusts  established  by the  Company  for the benefit of
employees of the Company or its subsidiaries,  shall become the beneficial owner
(within the meaning of Rule l3d-3 under the Exchange  Act) of 50 percent or more
of outstanding  Common Stock and was not the  beneficial  owner of 50 percent or
more of the outstanding Common Stock prior to the Effective Date; or
(iii)  commencement  by any entity,  person,  or group  (including any affiliate
thereof,  other than the Company) of a tender  offer or exchange  offer for more
than 20 percent of the outstanding Common Stock.

2.3      "Code" means the Internal Revenue Code of 1986, as amended.

2.4      "Committee" shall have the meaning provided in Section 3 of the Plan.

2.5      "Common Stock" means the common stock, $.01 par value, of the Company.

2.6 "Continuous  Service" means that the Participant's  service with the Company
or any Subsidiary, or any predecessor of the Company or any Subsidiary,  whether
as an employee,  officer, director, adviser or consultant, is not interrupted or
terminated.  The  Participant's  Continuous  Service shall not be deemed to have
terminated  merely because of a change in the capacity in which the  Participant
renders  service  to the  Company or any  Subsidiary  as an  employee,  officer,
consultant,  adviser  or  director  or a change  in the  entity  for  which  the
Participant  renders such  service,  provided that there is no  interruption  or
termination of the Participant's  Continuous  Service.  For example, a change in
status  from an employee of the Company to a  consultant  of a  Subsidiary  or a
director  will  not  constitute  an  interruption  of  Continuous  Service.  The
Committee,  in that party's sole discretion,  may determine  whether  Continuous
Service  shall be  considered  interrupted  in the case of any leave of  absence
approved  by that  party,  including  sick  leave,  military  leave or any other
personal leave.

2.7  "Disability"  means,  as it relates to the exercise of an  Incentive  Stock
Option after  termination  of  employment,  a  disability  within the meaning of
Section  22(e)(3) of the Code, and for all other purposes,  a mental or physical
condition which, in the opinion of the Committee,  renders a Participant  unable
or incompetent to carry out the job responsibilities which such Participant held
or the tasks to which such  Participant  was assigned at the time the disability
was  incurred,  and  which is  expected  to be  permanent  or for an  indefinite
duration exceeding one year.

2.8   Effective Date" shall have the meaning provided in Section 26 of the Plan.

2.9  "Exchange Act" means the Securities Exchange Act of 1934, as amended.

2.10 "Fair Market Value" means,  as determined by the  Committee,  the last sale
price as quoted on the Nasdaq  National  Market on the trading  day  immediately
preceding  the date for which the  determination  is being made or, in the event
that no such sale takes place on such day, the average of the  reported  closing
bid and asked  prices on such day,  or, if the  Common  Stock of the  Company is
listed on a national  securities  exchange,  the last reported sale price on the
principal  national  securities  exchange on which the Common Stock is listed or
admitted to trading on the trading day immediately  preceding the date for which
the determination is being made or, if no such reported sale takes place on such
day,  the  average  of the  closing  bid and  asked  prices  on such  day on the
principal  national  securities  exchange on which the Common Stock is listed or
admitted  to  trading,  or if the  Common  Stock is not  quoted  on such  Nasdaq
National  Market nor  listed or  admitted  to  trading on a national  securities
exchange,  then the  average  of the  closing  bid and  asked  prices on the day
immediately  preceding the date for which the determination is being made in the
over-the-counter  market as reported  by NASDAQ or, if bid and asked  prices for
the Common Stock on such day shall not have been reported  through  NASDAQ,  the
average  of the bid and asked  prices for such day as  finished  by any New York
Stock  Exchange  member  firm  regularly  making a market  in the  Common  Stock
selected  for such purpose by the Board or a committee  thereof,  or, if none of
the foregoing is  applicable,  then the fair market value of the Common Stock as
determined in good faith by the Committee in its sole discretion.
2.11 "Incentive  Stock Option" means a stock option granted under the Plan which
is intended to be designated as an "incentive  stock option"  within the meaning
of Section 422 of the Code.

2.12 "Listing  Date" means the first date upon which any security of the Company
is listed (or approved for  listing)  upon notice of issuance on any  securities
exchange or designated (or approved for designation)  upon notice of issuance as
a national market security on an interdealer quotation system.

2.13  "Non-Qualified  Stock Option" means a stock option  granted under the Plan
which is not  intended to be an  Incentive  Stock  Option,  including  any stock
option that provides (as of the time such option is granted) that it will not be
treated  as an  Incentive  Stock  Option nor as an option  described  in Section
423(b) of the Code.

2.14  "Parent"  means any  corporation  (other than the  Company) in an unbroken
chain of corporations ending with the Company if, at the time of the granting of
the option or other award, each of the corporations  other than the Company owns
stock  possessing 50 percent or more of the combined voting power of all classes
of stock in one of the other corporations in the chain.

2.15  "Participant"  shall mean any  employee,  director  or officer  of, or key
adviser or  consultant  to, the  Company or any  Subsidiary  to whom an award is
granted under the Plan.

2.16 "Plan Year" means the twelve-month period beginning on January 1 and ending
on December  31;  provided,  however,  that the first Plan Year shall be a short
Plan Year beginning on the Effective Date and ending on December 31, 2000.

2.17 "Restricted  Stock Award" means an award of shares of Common Stock pursuant
     to Section 8.

2.18 "Stock Appreciation Right" means an award made pursuant to Section 7.

2.19 "Stock Bonus Award" means an award made pursuant to Section 9.

2.20 "Stock Option" means any option to purchase  Common Stock granted  pursuant
     to Section 6.

2.21  "Subsidiary"  means:  (i) as it relates to Incentive  Stock  Options,  any
corporation  (other  than the  Company)  in an  unbroken  chain of  corporations
beginning  with the Company if, at the time of the granting of the option,  each
of the corporations (other than the last corporation in the unbroken chain) owns
stock  possessing 50 percent or more of the total  combined  voting power of all
classes of stock in one of the other corporations in the chain; and (ii) for all
other  purposes,  a  company,  domestic  or  foreign,  of which not less than 50
percent of the total  voting  power is held by the  Company or by a  Subsidiary,
whether or not such company now exists or is hereafter  organized or acquired by
the Company or by a Subsidiary.

2.22 "Term of the Plan" means the period  beginning  on the  Effective  Date and
ending on the  earlier  to occur of (i) the date the Plan is  terminated  by the
Board  in  accordance  with  Section  23 and  (ii)  the  day  before  the  tenth
anniversary of the Effective Date.

Section 3.........Administration. The Plan shall be administered by the Board or
a committee of the Board (as the Board in its sole discretion shall  determine);
provided,  however,  that if the Company  registers any class of equity security
pursuant  to  Section  12  of  the  Exchange  Act,  and  if  the  Plan  is to be
administered  by a committee,  then such committee  shall consist of two or more
members  of the  Board,  each of whom  shall  each  qualify  as a  "Non-employee
Director"  within the meaning of Rule 16b-3 of the Exchange Act and also qualify
as an "outside  director"  within the meaning of Section  162(m) of the Code and
regulations pursuant thereto. For Purposes of the Plan, the Board acting in this
capacity or the Committee  described in the preceding sentence shall be referred
to as the "Committee". The Committee shall have the power and authority to grant
to eligible  persons  pursuant to the terms of the Plan: (1) Stock Options,  (2)
Stock Appreciation  Rights, (3) Restricted Stock Awards, (4) Stock Bonus Awards,
or (5) any combination of the foregoing.

         The Committee  shall have  authority in its discretion to interpret the
provisions  of the Plan and to  decide  all  questions  of fact  arising  in its
application.  Upon the  recommendation  of the Chief  Executive  Officer  of the
Company, the Committee shall also have the authority in its discretion to select
the persons to whom awards shall be made under the Plan;  to  determine  whether
and to what extent  awards shall be made under the Plan;  to determine the types
of award to be made and the  amount,  size,  terms and  conditions  of each such
award; and to determine the time when the awards shall be granted. The Committee
shall have the authority in its discretion to determine whether,  to what extent
and under what circumstances Common Stock and other amounts payable with respect
to an award  under the Plan shall be  deferred  either  automatically  or at the
election of the  Participant;  to adopt,  alter and repeal  such  administrative
rules, guidelines and practices governing the Plan as it shall from time to time
deem advisable;  and to make all other determinations necessary or advisable for
the  administration  of the Plan.  Notwithstanding  anything  in the Plan to the
contrary,  in the event that the  Committee  determines  that it is advisable to
grant awards  which shall not qualify for the  exception  for  performance-based
compensation  from the tax  deductibility  limitations  of Section 162(m) of the
Code,  the  Committee  may make such grants or awards,  or may amend the Plan to
provide  for such  grants or awards,  without  satisfying  the  requirements  of
Section 162(m) of the Code.

         The Committee  also shall have  authority in its discretion to vary the
terms of the Plan to the extent necessary to comply with federal, state or local
law.

         Notwithstanding  anything in the Plan to the contrary,  with respect to
any Participant or eligible person who is resident outside of the United States,
the Committee may, in its sole discretion,  amend the terms of the Plan in order
to  conform  such  terms  with  the  requirements  of  local  law or to meet the
objectives of the Plan. The Committee may, where  appropriate,  establish one or
more sub-plans for this purpose.

         All decisions  made by the Committee  pursuant to the provisions of the
Plan shall be final and binding on all persons who participate in the Plan.

         All  expenses  and  liabilities   incurred  by  the  Committee  in  the
administration  of the Plan shall be borne by the  Company.  The  Committee  may
employ attorneys,  consultants,  accountants or other persons in connection with
the  administration  of the Plan.  The Company,  and its officers and directors,
shall be entitled to rely upon the advice,  opinions or  valuations  of any such
Persons.

Section 4.........Common Stock Subject to the Plan.
                  --------------------------------

4.1  Share Reserve. There shall be reserved and available for issuance under the
Plan 258,000 shares of Common Stock,  subject to such  adjustment as may be made
pursuant to Section 22.

4.2 Source of Shares/Reversion of Shares. Such shares may consist in whole or in
part of authorized  and unissued  shares or treasury  shares or any  combination
thereof as the Committee may determine. Except as otherwise provided herein, any
shares  subject  to an  option  or right  which  for any  reason  expires  or is
terminated  unexercised,  becomes  unexercisable,  or is  forfeited or otherwise
terminated, surrendered or canceled as to any shares, or if any shares of Common
Stock are  surrendered  to the Company in connection  with any award (whether or
not such  surrendered  shares were  acquired  pursuant to any award),  or if any
shares are  withheld by the  Company,  the shares  subject to such award and the
surrendered and withheld shares shall thereafter be available for further awards
under the Plan; provided,  however, that any such shares that are surrendered to
or withheld by the Company in  connection  with any award or that are  otherwise
forfeited  after  issuance  shall not be  available  for  purchase  pursuant  to
Incentive Stock Options.  No awards may be granted following the end of the Term
of the Plan.

4.3 Code Section 162(m)  Limitation.  The total number of shares of Common Stock
for  which  (i)  Stock  Options,  (ii)  Stock  Appreciation  Rights,  and  (iii)
Restricted  Stock  Awards  and  Stock  Bonus  Awards  that  are  subject  to the
attainment of performance  criteria to protect against the loss of deductibility
under  Section  162(m) of the Code,  may be granted to any  employee  during any
twelve  month  period  shall not  exceed  129,000 in the  aggregate,  subject to
adjustment pursuant to Section 22. This Section 4.3 shall not apply prior to the
Listing Date and,  following the Listing Date,  this Section 4.3 shall not apply
until (i) the  earliest  of:  (1) the first  material  modification  of the Plan
(including  any  increase in the number of shares of Common  Stock  reserved for
issuance under the Plan in accordance with Section 4.1); (2) the issuance of all
of the shares of Common  Stock  reserved for  issuance  under the Plan;  (3) the
expiration  of the  Plan;  or (4) the first  meeting  of  stockholders  at which
directors  are to be elected that occurs  after the close of the third  calendar
year following the calendar year in which occurred the first  registration of an
equity  security  under  Section 12 of the Exchange Act; or (ii) such other date
required by Section 162(m) of the Code and the rules and regulations promulgated
thereunder.

Section  5.........Eligibility to Receive Awards. An award may be granted to any
employee,  director, or officer of, or key adviser or consultant to, the Company
or any  Subsidiary,  who is responsible  for or  contributes to the  management,
growth or success  of the  Company or any  Subsidiary,  provided  that bona fide
services  shall be  rendered  by  consultants  or advisers to the Company or its
Subsidiaries and such services must not be in connection with the offer and sale
of  securities  in a  capital-raising  transaction  and  must  not  directly  or
indirectly promote or maintain a market for the Company's securities.  The Chief
Executive  Officer of the Company shall recommend to the Committee those persons
to whom an award should be granted,  the type of award that should be granted to
each such person and the size, terms and conditions of each such award.  Subject
to the preceding  sentences of this Section 5, the Committee shall have the sole
authority to select the persons to whom an award is to be granted  hereunder and
to determine what type of award is to be granted to each such person.  No person
shall have any right to  participate  in the Plan.  Any person  selected  by the
Committee  for  participation  during any one period  will not by virtue of such
participation  have the  right to be  selected  as a  Participant  for any other
period.

Section 6.........Stock Options. A Stock Option may be an Incentive Stock Option
or a Non-Qualified  Stock Option. Only employees of the Company or any Parent or
Subsidiary of the Company are eligible to receive  Incentive  Stock Options.  To
the extent that any Stock Option does not qualify as an Incentive  Stock Option,
it shall constitute a separate  Non-Qualified Stock Option. Stock Options may be
granted alone or in addition to other awards  granted under the Plan.  The terms
and conditions of each Stock Option granted under the Plan shall be specified by
the  Committee,  in its sole  discretion,  and  shall be set  forth in a written
option  agreement  between the Company and the  Participant  in such form as the
Committee shall approve from time to time. No person shall have any rights under
any Stock  Option  granted  under the Plan  unless and until the Company and the
person to whom such Stock Option shall have been granted shall have executed and
delivered  an agreement  expressly  granting the Stock Option to such person and
containing  provisions  setting forth the terms for the Stock Option.  The terms
and conditions of each Incentive  Stock Option shall be such that each Incentive
Stock  Option  issued  hereunder  shall  constitute  and shall be  treated as an
"incentive  stock  option" as defined in Section 422 of the Code.  The terms and
conditions  of  each   Non-Qualified   Stock  Option  will  be  such  that  each
Non-Qualified  Stock Option issued hereunder shall not constitute nor be treated
as an  "incentive  stock  option" as  defined  in Section  422 of the Code or an
option  described  in  Section  423(b) of the Code and will be a  "non-qualified
stock option" for federal  income tax purposes.  The terms and conditions of any
Stock Option granted hereunder need not be identical to those of any other Stock
Option  granted  hereunder.  The  agreements  shall  contain  in  substance  the
following  terms  and  conditions  and may  contain  such  additional  terms and
conditions,  not inconsistent with the terms of the Plan, as the Committee shall
deem desirable:

6.1 Type of Option.  Each option agreement shall identify the option represented
thereby as an Incentive  Stock Option or a  Non-Qualified  Stock Option,  as the
case may be.

6.2  Option  Price.  The  Stock  Option  exercise  price  shall  be fixed by the
Committee  but shall in no event be less than 100 percent (or 110 percent in the
case of an Incentive Stock Option granted to an employee  referred to in Section
6.8(ii) below) of the Fair Market Value of the shares of Common Stock subject to
the Stock Option on the date the Stock Option is granted.

6.3 Exercise Term.  Each option  agreement  shall state the period or periods of
time within which the Stock Option may be exercised,  in whole or in part, which
shall be such period or periods of time as may be determined  by the  Committee,
provided that no Stock Option shall be exercisable after ten years from the date
of grant  thereof  (or, in the case of an Incentive  Stock Option  granted to an
employee  referred  to in  Section  6.8(ii)  below,  such term shall in no event
exceed  five (5) years from the date on which  such  Incentive  Stock  Option is
granted);  provided  further,  each option  granted  under the Plan shall become
exercisable six (6) months after the grant date, unless specifically  stipulated
otherwise  under the option  agreement.  The  Committee  shall have the power to
permit an acceleration of previously  established exercise terms, subject to the
requirements set forth herein, upon such circumstances and subject to such terms
and conditions as the Committee deems appropriate.

6.4 Payment for Shares.  A Stock  Option  shall be deemed to be  exercised  when
written notice of such exercise has been given to the Company in accordance with
the terms of the option  agreement by the  Participant  entitled to exercise the
Stock  Option and full  payment for the shares of Common  Stock with  respect to
which the Stock  Option is  exercised  has been  received  by the  Company.  The
Committee, in its sole discretion,  may permit all or part of the payment of the
exercise  price to be made, to the extent  permitted by applicable  statutes and
regulations,  either:  (i) in cash,  by check or wire  transfer,  or (ii) in any
other form of legal  consideration  as provided for under the terms of the Stock
Option.  No shares  of Common  Stock  shall be  issued to any  Participant  upon
exercise of a Stock Option until the Company  receives full payment  therefor as
described above. Upon the receipt of notice of exercise and full payment for the
shares of Common Stock,  the shares of Common Stock shall be deemed to have been
issued and the  Participant  shall be entitled to receive  such shares of Common
Stock and shall be a stockholder with respect to such shares,  and the shares of
Common Stock shall be  considered  fully paid and  nonassessable.  No adjustment
will be made for a dividend or other right for which the record date is prior to
the date on which the stock is issued,  except as  provided in Section 22 of the
Plan.  Each  exercise of a Stock Option shall reduce,  by an equal  number,  the
total number of shares of Common Stock that may  thereafter  be purchased  under
such Stock Option.
6.5 Rights upon Termination of Continuous  Service or Change of Control.  Except
as  otherwise  provided  below  in  this  Section  6.5,  in  the  event  that  a
Participant's  Continuous  Service  terminates for any reason, any rights of the
Participant  under any  Stock  Option  shall  immediately  terminate;  provided,
however, the Participant (or any successor or legal  representative)  shall have
the right to exercise  the Stock  Option to the extent that the Stock Option was
exercisable at the time of termination,  until the earlier of (i) the date three
(3) months after the effective date of such  termination of Continuous  Service,
or  such  other  date as  otherwise  determined  by the  Committee  in its  sole
discretion, or (ii) the expiration of the term of the Stock Option.

         If the Board  determines in its sole discretion that the  Participant's
Continuous  Service has been  terminated for "cause" (as such term is defined in
the Participant's  Stock Option  agreement) or if the  Participant's  Continuous
Service is  terminated  by reason of the  Participant's  voluntary  quitting  or
resignation  prior to his or her  completion of 20 years of Continuous  Service,
the Participant (or any successor or legal  representative)  shall only have the
right to  exercise  the Stock  Option to the  extent  that the Stock  Option was
exercisable at the time of termination, until the earlier of (i) the date thirty
(30) days after the effective date of such termination of Continuous Service, or
such other date as determined by the Committee in its sole  discretion,  or (ii)
the expiration of the term of the Stock Option.

         In the event  that  prior to the  expiration  of the Stock  Option  and
without  the   Participant's   having  fully  exercised  the  Stock  Option,   a
Participant's  Continuous  Service  terminates  because such  Participant  dies,
suffers a Disability or retires at or after attaining age 55 and completing five
(5)  years  of  Continuous  Service,  or the  Participant's  Continuous  Service
terminates  for any reason  (other than  termination  for cause) on or after the
date the Participant  completes 20 years of Continuous Service,  the Participant
or his  successor  or legal  representative  shall be fully  vested in the Stock
Option and shall have the right to exercise  the Stock  Option until the earlier
of (i) the date six (6) months following such termination of Continuous Service,
or such other date as  determined by the  Committee in its sole  discretion,  or
(ii) the expiration of the term of the Stock Option.

         In the  event  of a  Change  of  Control  upon or  prior  to the date a
Participant's  Continuous  Service  terminates,  the Participant  shall be fully
vested  in the Stock  Option,  and the  Participant  or his  successor  or legal
representative  shall  have the right to  exercise  the Stock  Option  until the
earlier of (i) the date six (6) months  after the  effective  date of his or her
termination  of  Continuous  Service  for  any  reason,  or such  other  date as
determined by the Committee in its sole  discretion,  or (ii) the  expiration of
the term of the Stock Option.

6.6 Exercise of Unvested Options.  The Stock Option agreement may, but need not,
include a  provision  whereby the  Participant  may elect at any time before the
Participant's  Continuous  Service terminates to exercise the Stock Option as to
any part or all of the shares of Common Stock  subject to the Stock Option prior
to the full vesting of the Stock Option.  Without limiting the generality of the
foregoing, the Committee may provide that if the Stock Option is exercised prior
to having fully vested, shares issued upon such exercise shall remain subject to
vesting  at the same rate as under the Stock  Option so  exercised  and shall be
subject to a right,  but not an  obligation,  of  repurchase by the Company with
respect  to all  unvested  Shares  or to any  other  restriction  the  Committee
determines to be appropriate.  For purposes of  facilitating  the enforcement of
any such right of repurchase,  at the request of the Committee,  the Participant
shall enter into joint  escrow  instructions  with the Company and deliver  each
certificate  for his or her unvested  shares of Common Stock with a stock power,
duly  endorsed in blank.  The  Company's  rights under this Section 6.6 shall be
freely assignable, in whole or in part.
6.7 Re-load Options.  Without in any way limiting the authority of the Committee
to make or not to make grants of Stock Options  hereunder,  the Committee  shall
have the  authority  (but not an  obligation)  to  include  as part of any Stock
Option a  provision  entitling  the  Participant  to a further  Stock  Option (a
"Re-Load  Option") in the event the  Participant  exercises  the original  Stock
Option,  in whole or in part,  by  surrendering  other shares of Common Stock in
accordance with this Plan and the terms and conditions of the Stock Option.  Any
such  Re-Load  Option  shall (i) provide for a number of shares of Common  Stock
equal to the number of shares of Common Stock  surrendered as part or all of the
exercise price of such Stock Option;  (ii) have an expiration  date which is the
same as the expiration  date of the Stock Option the exercise of which gave rise
to such Re-Load  Option;  and (iii) have an exercise price which is equal to 100
percent of the Fair  Market  Value of the Common  Stock  subject to the  Re-Load
Option on the date of exercise of the original Stock Option. Notwithstanding the
foregoing, a Re-Load Option shall be subject to the same exercise price and term
provisions heretofore described for Stock Options under the Plan.

         Any  such  Re-Load  Option  may  be  an  Incentive  Stock  Option  or a
Non-Qualified  Stock  Option,  as the Committee may designate at the time of the
grant of the original Stock Option;  provided,  however,  the designation of any
Re-Load  Option as an  Incentive  Stock  Option shall be subject to the $100,000
annual limitation on the  exercisability of Incentive Stock Options described in
Section 6.7 and in Section 422(d) of the Code. There shall be no Re-Load Options
on  a  Re-Load  Option.  Any  such  Re-Load  Option  shall  be  subject  to  the
availability  of  sufficient  shares of Common  Stock under  Section 4.1 and the
limitation on the grants of Stock Options under Section 4.3 and shall be subject
to such other terms and conditions as the Committee may determine  which are not
inconsistent  with the express  provisions  of the Plan  regarding  the terms of
Stock Options.

6.8 Special Incentive Stock Option Rules.  Notwithstanding the foregoing, in the
case of an Incentive  Stock  Option,  each option  agreement  shall contain such
other terms,  conditions and provisions as the Committee determines necessary or
desirable in order to qualify  such Stock  Option as an  Incentive  Stock Option
under the Code including, without limitation, the following:

(i) To the extent that the  aggregate  Fair Market Value  (determined  as of the
time the option is granted) of the Common Stock, with respect to which Incentive
Stock  Options  granted  under this Plan (and all other plans of the Company and
its Subsidiaries and Parent) become exercisable for the first time by any person
in any  calendar  year,  exceeds  $100,000,  such  options  shall be  treated as
Non-Qualified Stock Options.

(ii) No Incentive  Stock Option shall be granted to any employee if, at the time
the  Incentive  Stock  Option  is  granted,  the  employee  (by  reason  of  the
attribution rules applicable under Section 424(d) of the Code) owns more than 10
percent of the  combined  voting power of all classes of stock of the Company or
any  Parent or  Subsidiary  unless at the time such  Incentive  Stock  Option is
granted  the  option  price is at least 110  percent  of the Fair  Market  Value
(determined as of the time the Incentive  Stock Option is granted) of the shares
of Common Stock subject to the Incentive  Stock Option and such Incentive  Stock
Option by its terms is not  exercisable  after the expiration of five years from
the date of grant.

If an Incentive  Stock Option is exercised  after the expiration of the exercise
periods  that apply for  purposes of Section 422 of the Code,  such Stock Option
shall thereafter be treated as a Non-Qualified Stock Option.

Section  7.........Stock  Appreciation Rights. Stock Appreciation Rights entitle
Participants  to increases  in the Fair Market Value of shares of Common  Stock.
The terms and conditions of each Stock Appreciation Right granted under the Plan
shall be specified by the Committee,  in its sole  discretion,  and shall be set
forth in a written  agreement  between the Company and the  Participant  in such
form as the Committee  shall  approve from time to time.  The  agreements  shall
contain in substance the  following  terms and  conditions  and may contain such
additional terms and conditions, not inconsistent with the terms of the Plan, as
the Committee shall deem desirable:

7.1 Award. Stock Appreciation  Rights shall entitle the Participant,  subject to
such terms and conditions determined by the Committee,  to receive upon exercise
thereof an award equal to all or a portion of the excess of: (i) the Fair Market
Value of a specified  number of shares of Common  Stock at the time of exercise,
over (ii) a specified price which shall not be less than 100 percent of the Fair
Market  Value  of the  Common  Stock at the time the  right is  granted  or,  if
connected  with a previously  issued Stock Option,  not less than 100 percent of
the Fair  Market  Value of the Common  Stock at the time such  Stock  Option was
granted. Such amount may be paid by the Company in cash, Common Stock (valued at
its then Fair Market  Value) or any  combination  thereof,  as the Committee may
determine. Stock Appreciation Rights may be, but are not required to be, granted
in connection with a previously or  contemporaneously  granted Stock Option.  In
the event of the exercise of a Stock  Appreciation  Right,  the number of shares
reserved for issuance hereunder shall be reduced by the number of shares covered
by the Stock Appreciation Right.

7.2 Term.  Each agreement shall state the period or periods of time within which
the Stock Appreciation  Right may be exercised,  in whole or in part, subject to
such terms and conditions  prescribed for such purpose by the Committee provided
that no Stock  Appreciation  Right shall be exercisable  prior to six months nor
after ten years from the date of grant  thereof.  The  Committee  shall have the
power to  permit an  acceleration  of  previously  established  exercise  terms,
subject  to the  requirements  set forth  herein,  upon such  circumstances  and
subject to such terms and conditions as the Committee deems appropriate.

7.3 Rights upon Termination of Continuous  Service or Change of Control.  Except
as  otherwise  provided  below  in  this  Section  7.3,  in  the  event  that  a
Participant's  Continuous  Service  terminates for any reason, any rights of the
Participant  under any Stock  Appreciation  Right shall  immediately  terminate;
provided,  however,  the Participant (or any successor or legal  representative)
shall have the right to exercise the Stock Appreciation Right to the extent that
the Stock Appreciation  Right was exercisable at the time of termination,  until
the earlier of (i) the date three (3) months  after the  effective  date of such
termination of Continuous Service, or such other date as otherwise determined by
the Committee in its sole discretion,  or (ii) the expiration of the term of the
Stock Appreciation Right.

         If the Board  determines in its sole discretion that the  Participant's
Continuous  Service has been  terminated for "cause" (as such term is defined in
the Participant's  Stock  Appreciation  Right agreement) or if the Participant's
Continuous  Service  is  terminated  by  reason of the  Participant's  voluntary
quitting or resignation prior to his or her completion of 20 years of Continuous
Service, the Participant (or any successor or legal  representative)  shall only
have the right to exercise the Stock  Appreciation  Right to the extent that the
Stock Appreciation  Right was exercisable at the time of termination,  until the
earlier  of (i) the date  thirty  (30)  days  after the  effective  date of such
termination  of  Continuous  Service,  or such other date as  determined  by the
Committee  in its sole  discretion,  or (ii) the  expiration  of the term of the
Stock Appreciation Right.

         In the event that  prior to the  expiration  of his Stock  Appreciation
Right and  without  having  fully  exercised  his Stock  Appreciation  Right,  a
Participant's  Continuous  Service  terminates  because such  Participant  dies,
suffers a Disability,  or retires at or after  attaining  age 55 and  completing
five (5) years of Continuous  Service,  or the Participant's  Continuous Service
terminates  for any  reason  (other  than  termination  for  cause)  on or after
completing 20 years of Continuous  Service,  the Participant or his successor or
legal  representative  shall be fully vested in the Stock Appreciation Right and
shall have the right to exercise the Stock  Appreciation Right until the earlier
of (i) the date six (6) months following such termination of Continuous Service,
or such other date as  determined by the  Committee in its sole  discretion,  or
(ii) the expiration of the term of the Stock Appreciation Right.

         In the event of a Change of Control  prior to the date a  Participant's
Continuous  Service  terminates,  the  Participant  shall be fully vested in the
Stock  Appreciation  Right,  and  the  Participant  or his  successor  or  legal
representative  shall have the right to exercise  the Stock  Appreciation  Right
until the earlier of (i) the date six (6) months after the effective date of his
or her  termination of Continuous  Service,  or such other date as determined by
the Committee in its sole discretion,  or (ii) the expiration of the term of the
Stock Appreciation Right.

Section 8.........Restricted Stock Awards. Restricted Stock Awards shall consist
of shares of Common Stock restricted against transfer  ("Restricted  Stock") and
subject to a substantial  risk of  forfeiture.  The terms and conditions of each
Restricted  Stock  Award  granted  under  the  Plan  shall be  specified  by the
Committee, in its sole discretion, and shall be set forth in a written agreement
between the  Company and the  Participant  in such form as the  Committee  shall
approve  from time to time.  The  agreements  shall  contain  in  substance  the
following  terms  and  conditions  and may  contain  such  additional  terms and
conditions,  not inconsistent with the terms of the Plan, as the Committee shall
deem desirable.

8.1  Vesting   Period.   Restricted   Stock  Awards  shall  be  subject  to  the
above-described   restrictions   over  such  vesting  period  as  the  Committee
determines.  To the extent the  Committee  deems  necessary  or  appropriate  to
protect  against loss of  deductibility  pursuant to Section 162(m) of the Code,
Restricted  Stock  Awards to any  Participant  may also be  subject  to  certain
conditions with respect to attainment of one or more preestablished  performance
objectives which shall relate to corporate,  subsidiary, division, group or unit
performance in terms of growth in gross revenue, earnings per share or ratios of
earnings to equity or assets, net profits,  stock price,  market share, sales or
costs;  provided  that such  objectives  may be adjusted by the Committee in its
sole discretion to reduce or eliminate,  but not to increase,  an award in order
to take into account unforeseen events or changes in circumstances.

8.2 Restriction upon Transfer. Shares awarded, and the right to vote such shares
and to  receive  dividends  thereon,  may not be  sold,  assigned,  transferred,
exchanged,  pledged,  hypothecated  or  otherwise  encumbered,  except as herein
provided or as provided in any agreement  entered into between the Company and a
Participant in connection with the Plan, during the vesting period applicable to
such shares.  Notwithstanding the foregoing, and except as otherwise provided in
the Plan,  the  Participant  shall  have all the other  rights of a  stockholder
including,  but not limited to, the right to receive  dividends and the right to
vote such shares,  until such time as the Participant  disposes of the shares or
forfeits the shares pursuant to the agreement  relating to the Restricted  Stock
Award.

8.3 Certificates. Any stock certificate issued in respect of shares awarded to a
Participant  shall be  registered in the name of the  Participant  and deposited
with the Company, or its designee, and shall bear the following legend:

                  "This certificate and the shares of stock  represented  hereby
                  are subject to the terms and conditions  (including forfeiture
                  provisions and restrictions against transfer) contained in the
                  Star Systems, Inc. 2000 Equity Incentive Plan and a Restricted
                  Stock Award  Agreement  entered  into  between the  registered
owner and Star  Systems,  Inc.  Release  from  such  terms and
                  conditions  shall  be  obtained  only in  accordance  with the
                  provisions of the Plan and Agreement,  a copy of each of which
                  is on file in the  office of the  Secretary  of Star  Systems,
                  Inc."

Each  Participant,  as a condition of any  Restricted  Stock  Award,  shall have
delivered a stock power, endorsed in blank, relating to the Common Stock covered
by such award.

8.4 Termination of Continuous Service or Change of Control.  Except as otherwise
provided in the written agreement relating to the Participant's Restricted Stock
Award, in the event that a Participant's  Continuous  Service terminates for any
reason,  other than death or  Disability,  any rights of the  Participant or his
successors  or legal  representatives  under any  Restricted  Stock  Award  that
remains subject to restrictions  shall immediately  terminate and any Restricted
Stock Award with unlapsed restrictions shall be forfeited to the Company without
payment of any consideration.

         Unless the written  agreement  between the  Participant and the Company
relating to the Restricted Stock Award provides  otherwise,  in the event that a
Participant's  Continuous  Service  terminates  because such Participant dies or
suffers a  Disability,  or in the event of a Change of Control prior to the date
the  Participant's  Continuous  Service  terminates,  all remaining  shares of a
Restricted Stock Award shall no longer be subject to any unlapsed restrictions.

Section  9.........Stock  Bonus  Awards.  To  the  extent  the  Committee  deems
necessary or appropriate to protect against the loss of  deductibility  pursuant
to Section 162(m) of the Code, the Committee may, in its sole discretion,  grant
a Stock Bonus Award based upon corporate,  division,  subsidiary,  group or unit
performance in terms of growth in gross revenue, earnings per share or ratios of
earnings to equity or assets, net profits,  stock price,  market share, sales or
costs or, with  respect to  Participants  not  subject to Section  162(m) of the
Code,  such other  measures or  standards  determined  by the  Committee  in its
discretion; provided, that such performance objectives may be adjusted to reduce
or  eliminate  but not to  increase  an  award in  order  to take  into  account
unforeseen events or changes in circumstances.

         The terms and  conditions  of each Stock Bonus Award  granted under the
Plan shall be specified by the Committee,  in its sole discretion,  and shall be
set forth in a written agreement between the Company and the Participant in such
form as the  Committee  shall  approve  from time to time.  In  addition  to any
applicable  performance  goals,  shares of Common Stock subject to a Stock Bonus
Award  may be:  (i)  subject  to  additional  restrictions  (including,  without
limitation, restrictions on transfer), or (ii) granted directly to a person free
of any  restrictions,  not  inconsistent  with  the  terms of the  Plan,  as the
Committee shall deem desirable.

Section  10........Loans.  The  Committee  may,  in its sole  discretion  and to
further the purpose of the Plan, provide for loans to persons in connection with
all or any part of an award  under the  Plan.  Any loan  made  pursuant  to this
Section 10 shall be  evidenced  by a loan  agreement,  promissory  note or other
instruments  in such form and which  shall  contain  such  terms and  conditions
(including,  without limitation,  provisions for interest,  payment,  schedules,
collateral,  forgiveness,  acceleration  of  such  loans  or  parts  thereof  or
acceleration  in the event of termination) as the Committee shall prescribe from
time to time.  Notwithstanding  the  foregoing,  each loan shall comply with all
applicable laws,  regulations and rules of the Board of Governors of the Federal
Reserve System and any other governmental agency having jurisdiction.

Section  11........Securities Law Requirements.  No shares of Common Stock shall
be issued upon the exercise or payment of any award unless and until:
(i) The shares of Common Stock  underlying the award have been registered  under
the  Securities  Act of  1933,  as  amended  (the  "Act"),  or the  Company  has
determined that an exemption from the registration requirements under the Act is
available  or the  registration  requirements  of the Act do not  apply  to such
exercise or payment;

(ii) The Company has determined that all applicable listing  requirements of any
stock  exchange  or  quotation  system on which the  shares of Common  Stock are
listed have been satisfied; and

(iii) The Company has determined that any other applicable provision of state or
Federal law, including without limitation  applicable state securities laws, has
been satisfied.

Section  12........Restrictions  on Transfer;  Representations  of  Participant;
Legends.
        -----------------------------------------------------------------

         Until  the  Common  Stock is  listed on any  United  States  securities
exchange  or traded on NASDAQ  or an  over-the-counter  quotation  system in the
United States, the shares of Common Stock issued to a Participant under the Plan
may not be sold, transferred or otherwise disposed of by the Participant (or his
or her successor or legal  representative)  for 180 days  following the date the
shares are both issued to the Participant and fully vested,  and such shares may
only be sold to a  stockholder  of the  Company  who is not an  employee  of the
Company or any  Subsidiary or Parent.  The Committee in its sole  discretion may
further restrict the  transferability of shares until the Common Stock is listed
on  any  United   States   securities   exchange  or  traded  on  NASDAQ  or  an
over-the-counter quotation system in the United States.

         Regardless  of whether the  offering and sale of shares of Common Stock
has been registered under the Securities Act or has been registered or qualified
under the securities laws of any state, the Company may impose restrictions upon
the sale,  pledge, or other transfer of such shares,  including the placement of
appropriate  legends on stock  certificates,  if, in the judgment of the Company
and its  counsel,  such  restrictions  are  necessary  or  desirable in order to
achieve  compliance  with the provisions of the  Securities  Act, the securities
laws of any state, or any other law. As a condition to the Participant's receipt
of shares, the Company may require the Participant to represent that such shares
are  being  acquired  for  investment,  and  not  with a view  to  the  sale  or
distribution thereof,  except in compliance with the Securities Act, and to make
other  representations as are deemed necessary or appropriate by the Company and
its  counsel.  Stock  certificates  evidencing  shares  acquired  pursuant to an
unregistered  transaction  to which the  Securities  Act  applies  shall  bear a
restrictive   legend   substantially  in  the  following  form  and  such  other
restrictive  legends as are required or deemed  advisable  under the Plan or the
provisions of any applicable law:

                  "THE  SHARES  REPRESENTED  BY THIS  CERTIFICATE  HAVE NOT BEEN
                  REGISTERED  UNDER THE  SECURITIES ACT OF 1933, AS AMENDED (THE
                  "ACT"),  OR QUALIFIED  UNDER THE SECURITIES LAWS OF ANY STATE.
                  THESE SHARES HAVE BEEN ACQUIRED FOR  INVESTMENT AND NOT WITH A
                  VIEW  TO OR FOR  SALE  IN  CONNECTION  WITH  ANY  DISTRIBUTION
                  THEREOF, AND MAY NOT BE SOLD, MORTGAGED, PLEDGED, HYPOTHECATED
                  OR OTHERWISE  TRANSFERRED  WITHOUT AN  EFFECTIVE  REGISTRATION
                  UNDER THE ACT AND  QUALIFICATION  UNDER ANY  APPLICABLE  STATE
                  SECURITIES  LAWS, OR WITHOUT AN OPINION OF COUNSEL  ACCEPTABLE
                  TO THE  COMPANY  AND ITS  COUNSEL  THAT SUCH  REGISTRATION  OR
                  QUALIFICATION IS NOT REQUIRED."

The Company  shall also place  legends on stock  certificates  representing  its
right of  repurchase  under  Sections  6.6 and 13 hereof  and the right of first
refusal  under  Section 14 hereof.  Any  determination  by the  Company  and its
counsel in connection with any of the matters set forth in this Section 12 shall
be conclusive and binding on all persons.

         The Company may, but shall not be obligated to, register or qualify the
sale of shares under the Securities Act or any other applicable law.

Section 13........Right of Repurchase of Vested Shares.
                  ------------------------------------

13.1 Repurchase  Right. At the  Committee's  discretion,  shares of Common Stock
issued to a  Participant  under this Plan may be subject to a right,  but not an
obligation,  of  repurchase by the Company (the "Right of  Repurchase"),  at the
price specified in Section 13.2 below, if the Participant's  Continuous  Service
terminates  for any  reason  ("Employment  Termination").  Shares  issued by the
Company shall be transferable  only by the  Participant  subject to the Right of
Repurchase,  and the Company  shall legend the Right of  Repurchase on the stock
certificates  evidencing such shares and shall take such other steps as it deems
necessary to ensure compliance with this restriction. The Company's rights under
this  Section  13.1 shall be in addition  to, and not in lieu of, the  Company's
right of  repurchase  under  Section 6.6 of any  unvested  shares  issued to the
Participant,  and the  Company's  rights under this Section 13.1 shall be freely
assignable, in whole or in part.

13.2 Repurchase Price. The price per share at which the Company may exercise the
Right of Repurchase under
         -----------------
Section 13.1 (the "Repurchase Price") shall be:

                  (a) the Fair Market Value of each share at the effective  date
of the  Participant's  Employment  Termination  (or, in the case of Common Stock
issued  upon  exercise  of the  Stock  Option  after the  effective  date of the
Participant's Employment Termination, the Fair Market Value of each share at the
date of exercise of such Stock Option); or

                  (b) such other price as the  Committee in its sole  discretion
shall determine in accordance with applicable state Blue Sky or other laws.

13.3 Repurchase  Procedure.  The Company may exercise its Right of Repurchase by
sending a written  notice to the  Participant  or his or her  successor or legal
representative  and to the escrow  agent,  if any, of its taking such action and
specifying  the  number of shares  being  repurchased.  The  Company's  Right of
Repurchase  shall  terminate if not exercised by written notice from the Company
to the Participant or his or her successor or legal representative within thirty
(30) days of the effective date of the Employment  Termination  (or, in the case
of Common  Stock issued upon  exercise of the Stock  Option after the  effective
date of the Participant's Employment Termination, within thirty (30) days of the
date of exercise of such Stock  Option).  If the Company  exercises its Right of
Repurchase,  within ninety (90) days of the effective date of the  Participant's
Employment  Termination (or, in the case of Common Stock issued upon exercise of
the  Stock  Option  after the  effective  date of the  Participant's  Employment
Termination,   within  ninety  (90)  days  after  the  date  of  exercise),  the
Participant, or his or her successor or legal representative,  or if applicable,
the  escrow  agent,  shall  deliver  to  the  Company  every  stock  certificate
representing the shares being repurchased, together with appropriate assignments
separate  from  certificates,  and the Company shall then promptly pay the total
Repurchase  Price in cash to the  Participant,  or if applicable,  to the escrow
agent, for delivery to the Participant.

13.4 Escrow. To facilitate the consummation of the Company's Right of Repurchase
under this Section 13, at the request of the Committee,  the Participant and the
Company  shall  execute  joint escrow  instructions  and the  Participant  shall
deliver and deposit with the escrow agent named in the joint escrow instructions
all  certificates  for the  shares of  Common  Stock  issued to the  Participant
pursuant to the Plan with a stock  power,  duly  endorsed  in blank.  The escrow
agent shall hold such documents and deliver the same to the Company  pursuant to
the joint escrow  instructions  and in accordance with the terms of this Section
13, as applicable.

13.5 Binding  Effect.  The  Company's  Right of  Repurchase  shall  inure to the
     benefit of its successors and ---------------  assigns and shall be binding
     upon any representative,  executor, administrator,  heir, or legatee of the
     Participant.

13.6 Termination of Right of Repurchase.  Notwithstanding any other provision of
this  Section  13, in the event  that the  Common  Stock is listed on any United
States securities exchange or traded on NASDAQ or an over-the-counter  quotation
system in the  United  States at the time the  Participant  would  otherwise  be
required  to  transfer  his or her shares of Common  Stock to the  Company,  the
Company  shall no  longer  have the Right of  Repurchase  with  respect  to such
shares, and the Participant shall have no obligation to comply with this Section
13 with respect to such shares.

Section 14........Right of First Refusal.
                  ----------------------

14.1 Right of First Refusal. At the Committee's  discretion,  shares issued to a
Participant  under  this  Plan  may be  subject  to a  requirement  that  if the
Participant  proposes to sell,  pledge, or otherwise transfer any such shares or
any interest in such shares,  to any person or entity,  the Company shall have a
right of first  refusal  (the  "Right of First  Refusal")  with  respect to such
shares.  Any  Participant  desiring to transfer  shares  subject to the Right of
First Refusal shall give a written notice (the "Transfer Notice") to the Company
describing fully the proposed transfer,  including the number of shares proposed
to be transferred,  the proposed transfer price, and the name and address of the
proposed transferee. The Transfer Notice shall be signed both by the Participant
and by the proposed  transferee and must constitute a binding commitment of both
parties to the  transfer  of the  shares.  The  Company  shall have the right to
purchase all (but not less than all) the shares  subject to the Transfer  Notice
on the terms of the proposal referred to in the Transfer Notice,  subject to any
change in such terms  permitted  under  Section  14.2  hereof,  by delivery of a
notice of exercise of the Right of First  Refusal  within thirty (30) days after
the date the Transfer  Notice is received by the Company.  The Company's  rights
under this Section 14.1 shall be freely assignable, in whole or in part.

14.2  Transfer of Shares.  If the Company  fails to exercise  the Right of First
Refusal within thirty (30) days after the date on which it receives the Transfer
Notice,  the Participant may, not later than six (6) months following receipt of
the Transfer Notice by the Company,  consummate a transfer of the shares subject
to the  Transfer  Notice on the terms and  conditions  described in the Transfer
Notice,  subject to restrictions on the transfer of such shares imposed pursuant
to Section 12. Any  proposed  transfer on terms and  conditions  different  from
those  described  in the Transfer  Notice,  as well as any  subsequent  proposed
transfer  by the  Participant,  shall  again be  subject  to the  Right of First
Refusal and shall again  require  compliance  with the  procedure  described  in
Section  14.1.  If the  Company  exercises  its  Right  of  First  Refusal,  the
Participant  shall  immediately  endorse and deliver to the Company  every stock
certificate  representing the shares being purchased, and the Company shall then
promptly pay the purchase price in accordance with Section 14.3.

14.3  Repurchase  Payment.  The amount payable to a Participant  pursuant to the
Company's  exercise  of  the  Right  of  First  Refusal  shall  be  paid  to the
Participant in accordance  with the terms and conditions of the Transfer  Notice
or may, at the election of the Company, be paid in three equal installments with
the first  installment  due and payable on the first date (the "Transfer  Notice
Date") that any payment would otherwise be payable to the  Participant  pursuant
to the terms and  conditions  of the  Transfer  Notice,  and with an  additional
installment   thereof   due  and  payable  on  each  of  the  first  and  second
anniversaries  of the Transfer Notice Date,  together with interest on each such
installment,  for the period from the  Transfer  Notice Date until the date such
installment  is paid, at the prime rate as published in The Wall Street  Journal
on the Transfer  Notice Date or, if The Wall Street  Journal is not published on
such date, on the first day  thereafter  that the prime rate is published in The
Wall Street Journal.

14.4 Binding  Effect.  The  Company's  Right of First Refusal shall inure to the
benefit of its  successors  and assigns and shall be binding upon any transferee
of the shares,  other than a transferee  acquiring  shares in a transaction with
respect to which the Company  failed to exercise  its Right of First  Refusal (a
"Free Transferee") or a transferee of a Free Transferee.

14.5 Termination of Right of First Refusal.  Notwithstanding any other provision
of this  Section  14,  if the  Common  Stock  is  listed  on any  United  States
securities exchange or traded on NASDAQ or an over-the-counter  quotation system
in the United States at the time the Participant  desires to transfer his or her
shares,  the Company  shall no longer have the Right of First  Refusal,  and the
Participant shall have no obligation to comply with this Section 14.

Section  15........Single  or Multiple  Agreements.  Multiple forms of awards or
combinations  thereof  may  be  evidenced  by a  single  agreement  or  multiple
agreements, as determined by the Committee.

Section 16........Rights of a Stockholder.  The recipient of any award under the
Plan,  unless  otherwise  provided  by the  Plan,  shall  have  no  rights  as a
stockholder  with  respect  thereto  unless and until shares of Common Stock are
issued to him.

Section  17........No  Right to Continue  Employment or Service.  Nothing in the
Plan or any instrument  executed or award granted  pursuant thereto shall confer
upon  any  Participant  any  right  to  continue  to serve  the  Company  or any
Subsidiary  in the capacity in effect at the time the award was granted or shall
affect  the  right  of the  Company  or any  Subsidiary  to  terminate  (i)  the
employment of an employee with or without notice and with or without cause, (ii)
the  service  of  a  consultant  or  adviser  pursuant  to  the  terms  of  such
consultant's or adviser's  agreement with the Company or any Subsidiary or (iii)
the  service  of a  director  pursuant  to  the  Bylaws  of the  Company  or any
Subsidiary  and any  applicable  provisions of the corporate law of the state in
which the Company or any Subsidiary is incorporated, as the case may be.

Section 18........Withholding. The Company's obligation to (i) deliver shares of
Common Stock or pay cash upon the exercise of any Non-Qualified  Stock Option or
any  Stock  Appreciation  Right  granted  under  the Plan,  (ii)  deliver  stock
certificates  upon the vesting of any Restricted  Stock Award, and (iii) deliver
shares of Common  Stock upon the grant of any Stock Bonus Award shall be subject
to applicable  foreign,  federal,  state and local withholding tax requirements.
Foreign,  federal,  state and local  withholding  tax due under the terms of the
Plan may be paid in cash or shares of Common Stock (either through the surrender
of previously held shares of Common Stock or the withholding of shares of Common
Stock  otherwise  issuable  upon the exercise or payment of such award) having a
Fair Market  Value equal to the required  withholding  and upon such other terms
and  conditions  as  the  Committee  shall  determine;  provided,  however,  the
Committee, in its sole discretion,  may require that such taxes be paid in cash;
and provided, further, any election by a Participant subject to Section 16(b) of
the Exchange Act to pay his  withholding  tax in shares of Common Stock shall be
subject to and must comply with Rule 16b-3 of the Exchange Act.
Section 19........Indemnification.  No member of the Board or the Committee, nor
any  officer or  employee of the  Company or a  Subsidiary  or Parent  acting on
behalf of the Board or the Committee, shall be personally liable for any action,
determination or interpretation  taken or made in good faith with respect to the
Plan,  and all members of the Board or the Committee and each and any officer or
employee  of the  Company or any  Subsidiary  or Parent  acting on their  behalf
shall, to the extent permitted by law, be fully indemnified and protected by the
Company in respect of any such action, determination or interpretation.

Section 20........Non-Assignability. No award under the Plan shall be assignable
or transferable by the recipient  thereof except by will, by the laws of descent
and  distribution and by such other means as the Committee may approve from time
to time.  No right or  benefit  hereunder  shall in any manner be subject to the
debts,  contracts,  liabilities or torts of the person entitled to such right or
benefit.

Section  21........Nonuniform  Determinations.  The  Committee's  determinations
under the Plan (including  without  limitation  determinations of the persons to
receive  awards,  the form,  amount  and  timing of such  awards,  the terms and
provisions  of  such  awards  and  the  agreements   evidencing  same,  and  the
establishment of values and performance  targets) need not be uniform and may be
made by it  selectively  among persons who receive,  or are eligible to receive,
awards under the Plan, whether or not such persons are similarly situated.

Section  22........Adjustments.  In the event of any  change in the  outstanding
shares of Common Stock,  without the receipt of consideration by the Company, by
reason of a stock dividend,  stock split,  reverse stock split or  distribution,
recapitalization,  merger,  reorganization,   reclassification,   consolidation,
split-up, spin-off, combination of shares, exchange of shares or other change in
corporate  structure affecting the Common Stock and not involving the receipt of
consideration by the Company,  the Committee shall make appropriate  adjustments
in (a) the aggregate  number of shares of Common Stock (i) reserved for issuance
under the Plan,  (ii) for which grants or awards may be made to any  Participant
and (iii) covered by outstanding unexercised awards and grants, (b) the exercise
or other  applicable  price related to outstanding  awards or grants and (c) the
appropriate  Fair  Market  Value  and other  price  determinations  relevant  to
outstanding  awards or grants and shall make such  other  adjustments  as may be
appropriate under the circumstances; provided, that the number of shares subject
to any award or grant always shall be a whole number.

Section  23........Termination  and Amendment.  The Board may terminate or amend
the Plan or any portion thereof at any time and the Committee may amend the Plan
to the extent provided in Section 3, without approval of the stockholders of the
Company,  unless stockholder  approval is required by Rule 16b-3 of the Exchange
Act,  applicable  stock  exchange  or NASDAQ or other  quotation  system  rules,
applicable  Code  provisions,  or  other  applicable  laws  or  regulations.  No
amendment,  termination  or  modification  of the Plan  shall  affect  any award
theretofore  granted in any  material  adverse  way  without  the consent of the
recipient.

Section 24........Severability.  If any of the terms or provisions of this Plan,
or awards made under this Plan, conflict with the requirements of Section 162(m)
or Section  422 of the Code with  respect to awards  subject to or  governed  by
Section 162(m) or Section 422 of the Code,  then such terms or provisions  shall
be deemed  inoperative to the extent they so conflict with the  requirements  of
Section  162(m) or Section 422 of the Code.  With respect to an Incentive  Stock
Option,  if this Plan does not  contain  any  provision  required to be included
herein under  Section 422 of the Code (as the same shall be amended from time to
time),  such provision shall be deemed to be  incorporated  herein with the same
force and effect as if such provision had been set out herein.
Section  25........Effect  on Other Plans.  Participation in this Plan shall not
affect  an  employee's  eligibility  to  participate  in any  other  benefit  or
incentive  plan of the Company or any Subsidiary and any awards made pursuant to
this Plan shall not be used in determining the benefits provided under any other
plan of the Company or any Subsidiary unless specifically provided.

Section 26........Effective Date of the Plan. The Plan shall become effective as
determined  by the Board,  but no Stock Option  shall be exercised  and no other
awards  shall be  granted  unless  and until the Plan has been  approved  by the
stockholders  of the Company,  which approval shall be within twelve (12) months
before or after the date the Plan is adopted by the Board.

Section  27........Governing  Law.  This  Plan and all  agreements  executed  in
connection with the Plan shall be governed by, and construed in accordance with,
the laws of the  State of  Delaware,  without  regard  to its  conflicts  of law
doctrine.

Section  28........Gender  and Number. Words denoting the masculine gender shall
include the  feminine  gender,  and words  denoting  the  feminine  gender shall
include the  masculine  gender.  Words in the plural shall include the singular,
and the singular shall include the plural.

Section  29........Acceleration  of  Exercisability  and Vesting.  The Committee
shall  have the  power to  accelerate  the time at which an award  may  first be
exercised  or the time during  which an award or any part  thereof  will vest in
accordance  with the Plan,  notwithstanding  the provisions in the award stating
the time at which it may first be  exercised  or the time  during  which it will
vest.

Section 30........Modification of Awards. Within the limitations of the Plan and
subject to Section 22, the Committee may modify outstanding awards or accept the
cancellation   of  outstanding   awards  for  the  granting  of  new  awards  in
substitution  therefor.  Notwithstanding the preceding sentence,  except for any
adjustment  described in Section 22, no modification of an award shall,  without
the consent of the Participant,  alter or impair any rights or obligations under
any award previously  granted under the Plan in any material adverse way without
the affected Participant's consent.

Section 31........No Strict  Construction.  No rule of strict construction shall
be applied  against  the  Company,  the  Committee,  or any other  person in the
interpretation  of any of the  terms of the  Plan,  any  agreement  executed  in
connection  with the Plan,  any  award  granted  under  the  Plan,  or any rule,
regulation or procedure established by the Committee.

Section  32........Successors.  This Plan is  binding  on and will  inure to the
benefit  of  any   successor  to  the   Company,   whether  by  way  of  merger,
consolidation, purchase, or otherwise.

Section  33........Plan  Provisions  Control.  The terms of the Plan  govern all
awards granted under the Plan, and in no event will the Committee have the power
to grant any award under the Plan which is contrary to any of the  provisions of
the Plan.  In the event any  provision of any award granted under the Plan shall
conflict with any term in the Plan, the term in the Plan shall control.

Section  34........Headings.  The headings used in the Plan are for  convenience
only,  do not  constitute a part of the Plan,  and shall not be deemed to limit,
characterize,  or  affect  in any  way  any  provisions  of the  Plan,  and  all
provisions of the Plan shall be construed as if no captions had been used in the
Plan.