As filed with the Securities and Exchange      Registration No. 333-________
Commission on June 17, 1998

===============================================================================
                      SECURITIES AND EXCHANGE COMMISSION
                            WASHINGTON, D.C. 20549
                              __________________

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

                             ___________________

                           DATASTREAM SYSTEMS, INC.
            (Exact name of Registrant as Specified in its Charter)

         Delaware                                            57-0813674
     (State or other                                      (I.R.S. Employer
     jurisdiction of                                     Identification No.)
     incorporation or
      organization)

                              50 Datastream Plaza
                               Greenville, South
                                 Carolina 29605
                             (Address of Principal
                               Executive Offices)

                             ___________________

                           DATASTREAM SYSTEMS, INC.
                       1997 EUROPEAN STOCK OPTION PLAN
                  (DUTCH, U.K. AND FRENCH SUB-PLAN VERSIONS)

                                     AND

                           DATASTREAM SYSTEMS, INC.
                            1998 STOCK OPTION PLAN
                          (Full Title of the Plans)
                             ___________________

                              Larry G. Blackwell
         Chairman of the Board, President and Chief Executive Officer
                           Datastream Systems, Inc.
                             50 Datastream Plaza
                       Greenville, South Carolina 29605
                                (864) 422-5001
          (Name, address, including zip code, and telephone number,
                  including area code, of agent for service)

                               With a copy to:
                             B. Lynn Walsh, Esq.
                              Hunton & Williams
                        NationsBank Plaza - Suite 4100
                         600 Peachtree Street, N. E.
                         Atlanta, Georgia 30308-2216
                                (404) 888-4000

                             ___________________

                       CALCULATION OF REGISTRATION FEE
===============================================================================
                                        Proposed       Proposed
 Title of securities   Amount to be     maximum        maximum      Amount of
   to be registered    registered(1) offering price   aggregate    registration
                                      per share(2)     offering        fee
                                                       price(2)
===============================================================================
Common Stock, $.01       1,110,000       $21.82      $24,220,200    $7,144.96
par value...........      shares
===============================================================================

(1)   Pursuant to Rule 416(a) the number of shares of Common Stock  registered
hereunder  includes such  indeterminate  number of additional shares of Common
Stock as may be offered or issued in the future to prevent dilution  resulting
from stock splits, stock dividends or similar transactions.

(2)   Estimated  solely for the purpose of  computing  the  registration  fee.
This amount was calculated  pursuant to Rule 457(c) on the basis of $21.82 per
share,  which was the  average of the high and low prices of the  Registrant's
Common Stock on June 15, 1998, as reported on the Nasdaq National Market.

<PAGE>
==============================================================================
                                    PART I

             INFORMATION REQUIRED IN THE SECTION 10(a) PROSPECTUS
==============================================================================

Item 1.     Plan Information.

      Not required to be filed with the  Securities  and  Exchange  Commission
(the "Commission").

Item 2.     Registrant Information and Employee Plan Annual Information.

      Not required to be filed with the Commission.

                                   PART II

              INFORMATION REQUIRED IN THE REGISTRATION STATEMENT

Item 3.     Incorporation of Documents by Reference.

      The  following  documents  filed  by  Datastream   Systems,   Inc.  (the
"Company") with the Commission are  incorporated  herein by reference and made
a part hereof:

            (i)   The Company's  Annual Report on Form 10-K for the year ended
                  December 31,  1997 (File No.  000-25590),  as filed with the
                  Commission March 31, 1998;

            (ii)  The  Company's   Current   Report  on  Form  8-K  (File  No.
                  000-25590), as filed with the Commission on April 14, 1998;

            (iii) The  Company's  Amendment  No.  1 to Form  10-K for the year
                  ended December 31,  1997 (File No. 000-25590), as filed with
                  the Commission April 16, 1998;

            (iv)  The Company's  Quarterly Report on Form 10-Q for the quarter
                  ended  March 31,  1998 (File No.  000-25590),  as filed with
                  the Commission May 13, 1998; and

            (v)   The  description  of  the  Common  Stock  contained  in  the
                  Company's  Registration  Statement on Form 8-A (Registration
                  No.  000-25590),  including any  amendments or reports filed
                  for the purpose of updating such description,  as filed with
                  the Commission February 17, 1995.

      All  documents  subsequently  filed by the Company  pursuant to Sections
13(a),  13(c), 14 and 15(d) of the Securities Exchange Act of 1934, as amended
(the "Exchange Act"), prior to the filing of a post-effective  amendment which
indicates that all securities  offered have been sold or which deregisters all
securities  then  remaining  unsold,  shall be  deemed to be  incorporated  by
reference in the  Registration  Statement  and to be part hereof from the date
of  filing  of  such  documents.   Any  statement   contained  in  a  document
incorporated by reference  herein 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  document  that  is
incorporated   by  reference   herein  modifies  or  supersedes  such  earlier
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 applicable.

Item 5.     Interests of Named Experts and Counsel.

      Not applicable.

Item 6.     Indemnification of Directors and Officers.

      Section 145 of the General  Corporation Law of Delaware  provides that a
corporation  may  indemnify  its  directors  and  officers  against  civil and
criminal  liabilities.  Directors  and  officers  may be  indemnified  against
expenses  if they acted in good faith and in a manner  reasonably  believed to
be in or not  opposed  to the best  interests  of the  corporation  and,  with
respect to any criminal  action,  if they had no  reasonable  cause to believe
their conduct was unlawful.  A director or officer may be indemnified  against
expenses  incurred in  connection  with a derivative  suit if he acted in good
faith and in a manner reasonably  believed to be in or not opposed to the best
interests  of the  corporation,  except  that no  indemnification  may be made
without court  approval if such person was adjudged  liable for  negligence or
misconduct  in the  performance  of his or her  duty to the  corporation.  The
statutory  indemnification  is not  exclusive  of any rights  provided  by any
by-law,   agreement,  vote  of  shareholders  or  disinterested  directors  or
otherwise.

      Article  VII  of the  Company's  Amended  and  Restated  Certificate  of
Incorporation  sets  forth the  extent to which the  Company's  directors  and
officers may be indemnified  against  liabilities and other monetary  expenses
which they may incur while serving in such  capacities.  Such  indemnification
will be provided to the full extent  permitted  and in the manner  required by
the  General  Corporation  Law of  Delaware.  Article  XII  of  the  Company's
By-laws also  provides  that the directors and officers of the Company will be
indemnified  against any losses  incurred in connection  with any  threatened,
pending or completed  action,  suit or proceeding,  whether  civil,  criminal,
administrative  or  investigative,  by  reason of the fact that he is or was a
director  or  officer  of the  Company  or served  with  another  corporation,
partnership,  joint venture,  trust or other  enterprise at the request of the
Company and will  provide  advances,  for expenses  incurred in defending  any
such  action,  suit or  proceeding,  upon receipt of an  undertaking  by or on
behalf  of  such  officer  or  director  to  repay  such  advances,  if  it is
ultimately  determined  that  he is not  entitled  to  indemnification  by the
Company.

Item 7.     Exemption from Registration Claimed.

      Not applicable.

Item 8.     Exhibits.

Exhibit No.   Description
-----------   -----------
4.1*          Amended and Restated Certificate of Incorporation of
              Datastream Systems, Inc.
4.2**         Amendment to Amended and Restated Certificate of
              Incorporation of Datastream Systems, Inc., dated January
              12, 1998.
4.3***        By-Laws of Datastream Systems, Inc.
4.4+          Specimen Stock Certificate.
5             Opinion of Hunton & Williams.
23.1          Consent of KPMG Peat Marwick LLP, independent certified
              public accountants.
23.2          Consent of Hunton & Williams (included as part of Exhibit
              5).
24            Power of Attorney (included on signature page hereto).
99.1(a)       Datastream Systems, Inc. 1997 European Stock Option Plan
              (Dutch (Sub-Plan) Version)
99.1(b)       Datastream Systems, Inc. 1997 European Stock Option Plan
              (U.K. (Sub-Plan) Version)
99.1(c)       Datastream Systems, Inc. 1997 European Stock Option Plan
              (French (Sub-Plan) Version)
99.2          Datastream Systems, Inc. 1998 Stock Option Plan
_____________________________
*     Incorporated herein by reference to Exhibit 3.1 in the Company's
      Registration Statement on Form S-1 (Registration No. 33-89498).

**    Incorporated herein by reference to Exhibit 3.1(a) in the Company's
      Annual Report on Form 10-K filed March 31, 1998 (File No. 000-25590).

***   Incorporated herein by reference to Exhibit 3.2 in the Company's
      Registration Statement on Form S-1 (Registration No. 33-89498).

+     Incorporated herein by reference to Exhibit 4.2 in the Company's
      Registration Statement on Form S-1 (Registration No. 33-89498).

Item 9.     Undertakings.

      (a)   The Company hereby undertakes:

            1.    To file,  during  any  period  in which  offers or sales are
being made, a post-effective amendment to this Registration Statement:

            (i)   To include any  prospectus  required by Section  10(a)(3) of
                  the Securities Act of 1933 (the "Securities Act");

            (ii)  To reflect  in the  prospectus  any facts or events  arising
                  after the effective date of the  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 the  Registration
                  Statement; and

            (iii) To include  any  material  information  with  respect to the
                  plan  of  distribution  not  previously   disclosed  in  the
                  Registration  Statement  or  any  material  change  to  such
                  information in the Registration Statement.

            2.    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.

            3.    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 Company  hereby  undertakes  that, for purposes of determining
any liability  under the Securities  Act, each filing of the Company's  annual
report  pursuant to  Section 13(a)  or Section 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  the  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 Company pursuant to the foregoing provisions or otherwise,  the
Company  has  been  advised  that  in  the  opinion  of  the  Commission  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
Company of expenses  incurred or paid by a  director,  officer or  controlling
person  of the  Company  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 Company 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 Greenville, South Carolina on this 17th day of June, 1998.

                                       DATASTREAM SYSTEMS, INC.


                                       By: /S/  Larry G. Blackwell  
                                          ------------------------    
                                          Larry G. Blackwell
                                          Chairman of the Board, President
                                       and
                                          Chief Executive Officer


                              POWER OF ATTORNEY

      KNOW  ALL MEN BY  THESE  PRESENTS,  that  each  person  whose  signature
appears  below  hereby  authorizes  each of Larry G.  Blackwell  and Daniel H.
Christie  to  execute  in the  name  of each  such  person,  and to  file  any
amendment,   including  any  post-effective  amendment,  to  the  Registration
Statement making such changes in the Registration  Statement as the Registrant
deems  appropriate,  and appoints  each of Messrs.  Blackwell  and Christie as
attorney-in-fact  to  sign in his  behalf  individually  and in each  capacity
stated below and file all  amendments  and  post-effective  amendments  to the
Registration Statement.

      Pursuant to the  requirements of the Securities  Act, this  Registration
Statement  has  been  signed  by  the  following  persons  in  the  capacities
indicated on the 17th day of June, 1998.

               Signature                               Title

                                         Chairman of the Board, President
/S/  Larry G. Blackwell                   and Chief Executive Officer
------------------------------            (principal executive officer)
Larry G. Blackwell                        
                                         Chief Financial Officer
/S/  Daniel H. Christie                   (principal financial and
------------------------------            accounting officer)
Daniel H. Christie

/S/ Kenneth D. Tracy                      Director
------------------------------
Kenneth D. Tracy

/S/ Richard T. Brock                      Director
------------------------------
Richard T. Brock

/S/ John M. Sterling, Jr.                 Director
------------------------------
John M. Sterling, Jr.

/S/ Ira D. Cohen                          Director
------------------------------
Ira D. Cohen


<PAGE>
                                EXHIBIT INDEX

Exhibit No.   Description
4.1*          Amended and Restated Certificate of Incorporation of
              Datastream Systems, Inc.
4.2**         Amendment to Amended and Restated Certificate of
              Incorporation of Datastream Systems, Inc., dated January
              12, 1998.
4.3***        By-Laws of Datastream Systems, Inc.
4.4+          Specimen Stock Certificate.
5             Opinion of Hunton & Williams.
23.1          Consent of KPMG Peat Marwick LLP, independent certified
              public accountants.
23.2          Consent of Hunton & Williams (included as part of Exhibit
              5).
24            Power of Attorney (included on signature page hereto).
99.1(a)       Datastream Systems, Inc. 1997 European Stock Option Plan
              (Dutch (Sub-Plan) Version)
99.1(b)       Datastream Systems, Inc. 1997 European Stock Option Plan
              (U.K. (Sub-Plan) Version)
99.1(c)       Datastream Systems, Inc. 1997 European Stock Option Plan
              (French (Sub-Plan) Version)
99.2          Datastream Systems, Inc. 1998 Stock Option Plan

______________________________
*     Incorporated herein by reference to Exhibit 3.1 in the Company's
      Registration Statement on Form S-1 (Registration No. 33-89498).

**    Incorporated herein by reference to Exhibit 3.1(a) in the Company's
      Annual Report on Form 10-K filed March 31, 1998 (File No. 000-25590).

***   Incorporated herein by reference to Exhibit 3.2 in the Company's
      Registration Statement on Form S-1 (Registration No. 33-89498).

+     Incorporated herein by reference to Exhibit 4.2 in the Company's
      Registration Statement on Form S-1 (Registration No. 33-89498).


<PAGE>
                                  EXHIBIT 5



                (Hunton and Williams Letterhead appears here)





                                June 17, 1998

Datastream Systems, Inc.
50 Datastream Plaza
Greenville, South Carolina 29605

      Re:   Datastream Systems, Inc. 1997 European Stock Option Plan
         and Datastream Systems, Inc. 1998 Stock Option Plan

Ladies and Gentlemen:

      We have  served as counsel  for  Datastream  Systems,  Inc.,  a Delaware
corporation  (the  "Company"),  in connection with the  registration on a Form
S-8  Registration   Statement  (the   "Registration   Statement")   under  the
Securities  Act of 1933, as amended,  of an aggregate of 610,000 shares of the
Company's  authorized  common  stock,  $.01 par value per share  (the  "Common
Stock"),  under the Datastream  Systems,  Inc. 1997 European Stock Option Plan
(the "1997  Plan") and an  aggregate  of 500,000  shares of Common Stock under
the Datastream Systems, Inc. 1998 Stock Option Plan (the "1998 Plan").

      We have  examined and are familiar with  originals or copies  (certified
or otherwise  identified to our  satisfaction)  of such  documents,  corporate
records and other instruments  relating to the organization of the Company and
to the  authorization  and issuance of the shares of Common  Stock  subject to
the 1997 Plan and the 1998 Plan, as appropriate,  as we have deemed  necessary
and advisable.

      Based upon the foregoing and having regard for such legal  consideration
as we deem  relevant,  it is our opinion that the shares of Common Stock under
the 1997 Plan and the 1998 Plan will be,  when issued in  accordance  with the
terms of each such plan, legally issued, fully paid and non-assessable.

      We do hereby  consent to the filing of this  Opinion as Exhibit 5 to the
      Registration Statement.

                                          Very truly yours.

                                          /s/ Hunton & Williams

                                          Hunton & Williams



08058
07688
08086


<PAGE>
                                 EXHIBIT 23.1









                        Independent Auditors' Consent
                        -----------------------------

The Board of Directors
Datastream Systems, Inc.:

We consent to  incorporation  by reference in this  Registration  Statement on
Form S-8 of  Datastream  Systems,  Inc. of our report dated  January 23, 1998,
relating to the consolidated  balance sheets of Datastream  Systems,  Inc. and
Subsidiaries  as of December 31, 1997 and 1996,  and the related  consolidated
statements of  operations,  stockholders'  equity,  and cash flows for each of
the years in the  three-year  period  ended  December  31,  1997,  and related
schedule,  which reports appear in the December 31, 1997 annual report on Form
10-K of Datastream Systems, Inc.




Greenville, South Carolina                            /s/ KPMG Peat Marwick
LLP
June 17, 1998



<PAGE>
                               EXHIBIT 99.1(a)

                             TERMS AND CONDITIONS
                         OF DATASTREAM SYSTEMS, INC.
                       1997 EUROPEAN STOCK OPTION PLAN
                           DUTCH (SUB-PLAN) VERSION

      1.          Definitions

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

            (b)         "Disability"  means a disability  of an Optionee  such
that the  Optionee is entitled to  disability  retirement  benefits  under the
Dutch  "WAO" (Wet op de  Arbeidsongeschiktheid)  or such that the  Optionee is
entitled to recover  benefits  under any long-term  disability  plan or policy
maintained  by the Company or an  Affiliate.  The  determination  of whether a
disability  exists shall be made by the Committee  and shall be  substantiated
by competent medical advice.

            (c)         "Employee"  means any  person who is  employed  by the
Company or an Affiliate as meant in article 7:610 Dutch Civil Code.

            (d)         "Fair  Market  Value"  with regard to a date means the
closing  price at which  Common Stock shall have been sold on the last trading
date prior to that date as reported by the Nasdaq  National Market System (or,
if applicable,  as reported by a national  securities exchange selected by the
Committee  (as  defined in the Plan) on which the  shares of Common  Stock are
then  actively  traded) and  published  in The Wall Street  Journal;  provided
that,  for purposes of granting  Options other than  incentive  stock options,
Fair  Market  Value of the  shares of Common  Stock may be  determined  by the
Committee by reference to the average  market value  determined  over a period
certain or as of  specified  dates,  to a tender offer price for the shares of
Common Stock (if  settlement  of an award is triggered by such an event) or to
any other  reasonable  measure  of fair  market  value.  If at the time of the
determination  of Fair Market  Value  shares of Common  Stock are not actively
traded on any market described above,  Fair Market Value means the fair market
value of a share of Common Stock as determined  by the  Committee  taking into
account such facts and  circumstances  deemed to be material by the  Committee
to the  value of the  Common  Stock in the  hands of the  Optionee;  provided,
however,  for  purposes  of  determining  the  Option  price  per share for an
incentive  stock  option,  Fair  Market  Value  shall  be  determined  by  the
Committee  without regard to any restriction  other than a restriction  which,
by its  terms,  will never  lapse.  Fair  Market  Value as  determined  by the
Committee shall be final, binding and conclusive upon each Optionee.

            (e)         "Termination  for Cause"  means a  termination  of the
employment  relationship  between the Optionee and the Company or an Affiliate
due to any of  the  following  reasons:  (1)  willful  and  continued  failure
(other than any such failure  resulting from his incapacity during physical or
mental  illness)  to  substantially  perform his duties with the Company or an
Affiliate  continuing  30 days after  notice by the Company to the Optionee of
such   failure;   (2)  any  act  of   fraud,   misappropriation,   dishonesty,
embezzlement  or similar  conduct  against  the  Company or an  Affiliate,  as
finally  determined  through  arbitration  or  final  judgment  of a court  of
competent  jurisdiction (which arbitration or judgment,  due to the passage of
time or otherwise,  is not subject to further  appeal);  or (3)  conviction of
the Optionee for a felony or any other crime involving moral turpitude  (which
conviction,  due to the  passage  of  time or  otherwise,  is not  subject  to
further  appeal);  or (4)  termination  by  the  employer  of  the  employment
agreement  as meant in article  7:678  Dutch  Civil Code  (ontslag  op staande
voet).



      2.          Term And Exercise Of Option
                  ---------------------------

            (a)         Except  as  otherwise   provided  in  this  Agreement,
Optionee  shall have the right to exercise the Option from time to time during
the  Exercise  Period  with  respect to all or any part of the  vested  Option
Shares.

            (b)         (1)   As  a  condition  to  exercising   this  Option,
Optionee  must deliver to the President of the Company on any business day (A)
written  notice,  signed by the person  exercising the Option,  specifying the
number  of  Option  Shares  being  exercised  and,  if  required,  making  the
representations  and covenants in  substantially  the same form as provided in
the Notice of Exercise,  attached as Exhibit A hereto;  (B) payment in cash or
in shares of Common  Stock  that have been held by the  Optionee  for at least
six months of the Purchase  Price  (defined in Section 3); (C) payment in cash
of the  tax  withholding  liability  arising  from  the  exercise;  and (D) an
executed   shareholders'   agreement,    containing   terms   and   conditions
substantially   similar  to  any  shareholders'   agreement  executed  by  and
applicable to the holders of a majority of the shares of Common  Stock,  if so
required by the Committee.

                  (1)         In lieu of  payment  of all tax  withholding  by
Optionee as provided  above,  Optionee  may elect to have the number of Option
Shares he is to receive  upon  exercise of an Option  reduced by the  smallest
number of whole Option Shares which,  when multiplied by the fair market value
of the Shares  determined as of the Tax Date (defined below), is sufficient to
satisfy required federal,  state, and local, if any, withholding taxes arising
from:

                        (A)         the  Withholding  Election  must  be  made
prior to  the date on  which the  amount of tax  required  to be  withheld  is
determined  (the "Tax Date") by  executing  and  delivering  to  the Company a
properly  completed  Notice  of Withholding  Election,  attached  as Exhibit B
hereto;

                        (B)         any  Withholding  Election  made  will  be
irrevocable;  however, the Committee may at its sole discretion disapprove and
give no effect to any Withholding Election; and

                        (C)         if  the   Optionee  is  required  to  file
beneficial  ownership  reports pursuant to Subsection (a) of Section 16 of the
Securities  Exchange Act of 1934 (the "Act"), at any time during the period in
which the Option is exercisable, then:

                           (i)            no Option  to which any  Withholding
Election  relates  may be  exercised  until the earlier of either (I) one year
after the Company has been subject to the  reporting  requirements  of Section
15 of the Act and has filed all  reports and  statements  required to be filed
pursuant to that Section  during that year,  or (II) at least six months after
the date of grant  (except in the event of death or Disability of the Optionee
prior to the expiration of the six-month period; and

                          (ii)            the  Withholding   Section  must  be
made  either  (A) at least six months  prior to the Tax Date,  or (B) prior to
the Tax  Date  and in any ten  business  day  period  beginning  on the  third
business  day  following  the  release of the  Company's  quarterly  or annual
summary statement of sales and earnings.

      Upon  receipt of such notice and payment in full of the  Purchase  Price
and tax  withholding  liability,  the  Company  shall  cause  to be  issued  a
certificate representing the shares of Common Stock purchased.

            (c)         Except as otherwise  provided in this  Agreement,  the
Option  shall  terminate  on the  earliest of (1) the last day of the Exercise
Period;  (2) the date the Committee  exercises its right pursuant to Section 8
to terminate the Option;  (3) thirty (30) days after Optionee  ceases to be an
Employee,  except if such  termination is due to Termination for Cause,  death
or Disability,  (4) one-hundred  eighty (180) days after Optionee ceases to be
an  Employee  if such  termination  is due to death or  Disability;  or (5) if
Optionee ceases to be an Employee as a result of a Termination for Cause,  the
time of such termination.

            (d)         The price paid by the Company  shall be payable at the
Company's  option (1) by delivery to the  Optionee of the entire  price in the
form of cash or check;  or (2) by payment of four  substantially  equal annual
installments,  the first  installment  being due at the date of termination of
the  Option and the  second,  third and  fourth  installment  being due on the
first,  second  and  third  anniversaries  of the date of  termination  of the
Option, respectively.

      3.          Purchase  Price.  Optionee  must  pay  to  the  Company  the
Exercise  Price  (subject to  adjustment  pursuant to Section 8) multiplied by
the number of the Option  Shares being  acquired  through the exercise of this
Option  (the  "Purchase  Price").  Shares  of  Common  Stock  tendered  by the
Optionee  in  satisfaction  of the  Purchase  Price shall be credited at their
Fair Market Value.

      4.          Non-Transferability  of Option.  Except for any  transfer of
the Option by bequest or  inheritance,  the Optionee  shall not have the right
to make or permit to exist any transfer or hypothecation,  whether outright or
as security, with or without consideration,  voluntary or involuntary,  of all
or any  part  of  any  right,  title  or  interest  in the  Option.  Any  such
disposition  not made in accordance  with this Agreement  shall be deemed null
and void.  The Option  shall be  exercisable  during the  lifetime of Optionee
only by  Optionee,  and  after  his  death  by a  legatee  or  legatees  under
Optionee's  last  will and  testament  or by his  personal  representative  or
representatives,  who shall be bound by the same  terms of this  Agreement  as
apply to the Optionee.

      5.          Restrictions  on  Transfer  of  Option  Shares.   Except  as
provided  in this  Agreement  or for any  transfer  of Option  Shares by gift,
bequest,  or  inheritance  to the  Optionee's  or a  subsequent  shareholder's
family  member,  estate,  heirs,  or  legatees or for any  transfer  after the
closing of an initial public offering of Common Stock,  the Optionee shall not
have the  right to make or  permit to exist  any  transfer  or  hypothecation,
whether outright or as security,  with or without consideration,  voluntary or
involuntary,  of all or any part of any right,  title or  interest  (including
but not  limited  to,  voting  rights)  in or to any Option  Shares.  Any such
disposition  not made in accordance  with this Agreement  shall be deemed null
and void.  Any permitted  transferee  under this Section shall be bound by the
same terms of this Agreement as apply to the Optionee.

      6.          No  Rights  as  Shareholder.   Optionee,  or  his  permitted
transferee  under  Section 4,  shall  have no  rights  as a  stockholder  with
respect to any Option Shares until the issuance of a stock  certificate to him
for such  shares.  No  adjustment  shall be made for  dividends  (ordinary  or
extraordinary,   whether   in  cash,   securities   or  other   property)   or
distributions  or other rights on or with respect to Option  Shares  purchased
pursuant  to this  Option  for which the  record  date is prior to the date of
exercise hereof, except as provided in Section 8 below.

      7.          Repurchase Rights.
                  -----------------

            (a)         (1)   At all times  prior to the closing of an initial
public  offering of Common Stock,  or (2) within ninety (90) days  following a
Termination  for Cause,  the Company shall have the right to  repurchase  from
the Optionee all Option Shares.  For this purpose,  a notice of exercise given
by the Company to the  Optionee  pursuant to this Section 7 shall be effective
to  perfect  the  Company's  right of  repurchase,  subject  to the  remaining
provisions of this Section 7.

            (b)         (1)   The  Company  upon   exercising  this  right  of
repurchase  shall give written  notice to the Optionee of the number of shares
of Option Shares to be repurchased,  of the repurchase  price,  which shall be
determined  pursuant to Section 7(c)  hereof,  and of the time and date of the
closing of the repurchase of the Option  Shares,  which shall be no later than
sixty  (60)  days  from  the  date  of the  notice  and  shall  be held at the
principal  office of the Company.  At closing,  the Company  shall deliver the
application  portion of the  repurchase  price and the Optionee  shall deliver
the Option  Shares to be  repurchased  duly endorsed for transfer and with all
required revenue stamps attached,  and the title to the Option Shares shall be
transferred  to  the  Company  free  and  clear  of  all  liens,  claims,  and
encumbrances,   however   described,   except  for  restrictions   imposed  by
applicable securities laws.

                  (1)         If the Company  decides to repurchase  less than
all of the Option Shares owned by the Optionee,  the Company shall employ such
method  as it shall  deem  appropriate  in  determining  the  number of Option
Shares to be repurchased.

                  (2)         The price for Option Shares  repurchased  by the
Company  shall be payable by  delivery  to the  Optionee at the closing of the
entire repurchase price in the form of cash or check;  provided,  however, the
Company  may pay the  entire  repurchase  price  in four  substantially  equal
annual  installments  consisting of principal and interest at the "Prime Rate"
reported in the Wall Street  Journal on the first  business day  preceding the
date of  repurchase,  the first  installment  being due at the closing and the
second,  third, and fourth  installment  being due on the first,  second,  and
third anniversaries of the closing, respectively.

                  (3)         If the Optionee  fails to consummate the sale or
deliver the Option Shares certificates  properly assigned when requested to do
so, the Company, or its designee,  shall cancel the Option Shares certificates
of the Optionee  and deposit the payment  pursuant to Section  7(b)(3)  hereof
which was to be made to the Optionee in exchange for the  certificates  to the
credit or account of the Optionee with escrow with any  clearinghouse  bank in
the  City of  Greenville,  South  Carolina,  at the  expense  and  risk of the
Optionee, or his successors or assigns,  whereupon the Company shall treat the
Option Shares  represented  thereby as having been  repurchased by the Company
or its designees.

            (c)         The  repurchase  price for each Option  Share shall be
an amount  equal to the Fair  Market  Value,  except if the Option  Shares are
repurchased  by the Company  pursuant to written  notice given  within  ninety
(90) days  following a  Termination  for Cause,  in which case the  repurchase
price for each Option  Share  shall be the lower of Fair  Market  Value or the
Exercise Price paid by the Optionee.

      8.          Change  in  Capitalization.   The  total  number  of  Option
Shares to be received  upon  exercise of the Option  (both as to the number of
Option Shares and the Purchase Price) shall be appropriately  adjusted for any
change  in  par  value,   split-up,   stock   split,   reverse   stock  split,
reclassification,  merger,  consolidation,  distribution of stock dividends or
similar  capital  adjustments,  to the end that the  Optionee's  proportionate
interest in value shall be maintained  as before the  occurrence of the event.
The adjustment  shall be made without change in the total price  applicable to
the unexercised  portion of the Option and with a corresponding  adjustment in
the Exercise Price.

      The  foregoing   adjustments  and  the  manner  of  application  of  the
foregoing  provisions  shall  be  determined  by the  Committee  in  its  sole
discretion.  Any adjustment may provide for the  elimination of any fractional
Option Shares.

      Notwithstanding  any other  provision of this  Agreement,  the Committee
reserves the right in the event of a sale of  substantially  all of the Common
Stock or  property  of the  Company  or the  merger  or  consolidation  of the
Company,  or a  dissolution  or  liquidation  of the Company to terminate  the
Option in  consideration  of the  payment to the  Optionee  of the  difference
between (1) and (2) where (1) equals the Fair Market Value of the  unexercised
Option  Shares to the extent  vested and (2) equals the Purchase  Price of the
unexercised Option Shares to the extent vested.

      9.          Governing   Laws.   This   Agreement   shall  be  construed,
administered  and  enforced  according  to the laws of the State of  Delaware;
provided,  however,  the Option may not be exercised except, in the reasonable
judgment  of the Board of  Directors,  in  compliance  with  exemptions  under
applicable  state  securities  laws of the  state in which  Optionee  resides,
and/or any other  applicable  securities  laws. In addition,  the  Participant
hereby  acknowledges  that this Option may have been granted prior to the time
the  interest   represented  hereby  was  registered  under  applicable  South
Carolina  securities laws and that, as a result,  the Participant may have the
right  to  rescind  the  grant  of  the  Option.  This  Agreement,  therefore,
constitutes  an offer to so  rescind  the prior  grant  for the  consideration
payable to the Optionee  specified by Section  35-1-1530 of the South Carolina
Uniform  Securities Act.  Because,  however,  the Participant has not paid any
consideration  for the grant,  the Participant  desires to decline such offer,
and does hereby waive such right of rescission  with respect to this Option as
of the date  hereof.  The Company  agrees to use its best  efforts to register
the  Option  (as  well  as the  Stock  into  which  it is  convertible)  under
applicable  federal and state  securities laws as soon as practicable,  and in
any  event  prior to the date on which  any  portion  of the  Option is vested
hereunder.

      10.         Successors.  This  Agreement  shall  inure to the benefit of
the heirs,  legal  representatives,  successors  and permitted  assigns of the
Company and Optionee.

      11.         Notice.   Any  notice  which  either  party  hereto  may  be
required or  permitted  to give to the other  shall be in writing,  and may be
delivered  personally or by mail,  postage prepaid,  addressed as follows:  to
the President of the Company,  or to the Company (attention of the President),
at 50 Datastream  Plaza,  Greenville,  South Carolina  29605,  or at any other
address as the Company,  by notice to Optionee,  may designate in writing from
time to time; to Optionee,  at  Optionee's  address as shown on the records of
the Company,  or at any other  address as Optionee,  by notice to the Company,
may designate in writing from time to time.

      12.         Severability.  In the  event  that  any  one or  more of the
provisions  or  portion  thereof  contained  in this  Agreement  shall for any
reason be held to be invalid,  illegal or  unenforceable  in any respect,  the
same shall not  invalidate  or otherwise  affect any other  provisions of this
Agreement,  and this Agreement  shall be construed as if the invalid,  illegal
or unenforceable provision or portion thereof had never been contained herein.

      13.         Entire  Agreement.  Subject to the terms and  conditions  of
the Datastream  Systems,  Inc. 1995 Stock Option Plan,  which is  incorporated
herein by reference,  this Agreement  expresses the entire  understanding  and
agreement of the parties hereto with respect to such terms,  restrictions  and
limitations.

      14.         Headings.  Section  headings used herein are for convenience
of reference only and shall not be considered in construing this Agreement.

      15.         Specific  Performance.   In  the  event  of  any  actual  or
threatened  default  in,  or  breach  of,  any of the  terms,  conditions  and
provisions of this Agreement,  the party or parties who are thereby  aggrieved
shall have the right to specific  performance  and  injunction  in addition to
any and all  other  rights  and  remedies  at law or in  equity,  and all such
rights and remedies shall be cumulative.

      16.         Resolution    of    Disputes.     Any    determination    or
interpretation by the Committee shall be final,  binding and conclusive on all
persons affected thereby.

      17.         Compliance with Securities  Laws.  Notwithstanding  anything
contained  herein to the contrary,  no purported  exercise of the Option shall
be  effective  without  the  written  approval  of the  Company,  which may be
withheld  to the  extent  that its  exercise,  either  individually  or in the
aggregate  together  with the  exercise of other  previously  exercised  stock
options  and/or  offers  and  sales  pursuant  to any  prior  or  contemplated
offering  of  securities,  would,  in the sole and  absolute  judgment  of the
Company,  require  the  filing of a  registration  statement  with the  United
States Securities and Exchange Commission,  or with the securities  commission
of  any  state.  The  Company  shall  avail  itself  of  any  exemptions  from
registration  contained in applicable federal and state securities laws which,
in its sole  and  absolute  discretion,  it deems  reasonable  and not  unduly
burdensome  or costly.  The Optionee  shall  deliver to the Company,  prior to
the exercise of the Option,  such information,  representations and warranties
as the  Company  may  request  in order for the  Company to be able to satisfy
itself that the Common  Stock to be acquired  pursuant to the  exercise of the
Option  is  being  acquired  in  accordance  with the  terms of an  applicable
exemption from the securities registration  requirements of applicable federal
and state securities laws.

                                   * * * * *

<PAGE>
                               EXHIBIT 99.1(b)

                             TERMS AND CONDITIONS
                         OF DATASTREAM SYSTEMS, INC.
                       1997 EUROPEAN STOCK OPTION PLAN
                      UNITED KINGDOM (SUB-PLAN) VERSION

      1.          Definitions
                  -----------

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

            (b)         "Disability"  means a disability  of an Optionee  such
that the  Optionee is entitled to  disability  retirement  benefits  under the
federal  Social  Security Act or such that the Optionee is entitled to recover
benefits  under any  long-term  disability  plan or policy  maintained  by the
Company or an  Affiliate.  The  determination  of whether a disability  exists
shall  be made by the  Committee  and  shall  be  substantiated  by  competent
medical advice.

            (c)         "Employee"  means any  person who is  employed  by the
Company or an Affiliate  for purposes of the Federal  Insurance  Contributions
Act.

            (d)         "Fair  Market  Value"  with regard to a date means the
closing  price at which  Common Stock shall have been sold on the last trading
date prior to that date as reported by the Nasdaq  National Market System (or,
if applicable,  as reported by a national  securities exchange selected by the
Committee  (as  defined in the Plan) on which the  shares of Common  Stock are
then  actively  traded) and  published  in The Wall Street  Journal;  provided
that,  for purposes of granting  Options other than  incentive  stock options,
Fair  Market  Value of the  shares of Common  Stock may be  determined  by the
Committee by reference to the average  market value  determined  over a period
certain or as of  specified  dates,  to a tender offer price for the shares of
Common Stock (if  settlement  of an award is triggered by such an event) or to
any other  reasonable  measure  of fair  market  value.  If at the time of the
determination  of Fair Market  Value  shares of Common  Stock are not actively
traded on any market described above,  Fair Market Value means the fair market
value of a share of Common Stock as determined  by the  Committee  taking into
account such facts and  circumstances  deemed to be material by the  Committee
to the  value of the  Common  Stock in the  hands of the  Optionee;  provided,
however,  for  purposes  of  determining  the  Option  price  per share for an
incentive  stock  option,  Fair  Market  Value  shall  be  determined  by  the
Committee  without regard to any restriction  other than a restriction  which,
by its  terms,  will never  lapse.  Fair  Market  Value as  determined  by the
Committee shall be final, binding and conclusive upon each Optionee.

            (e)         "Termination  for Cause"  means a  termination  of the
employment  relationship  between the Optionee and the Company or an Affiliate
due to any of  the  following  reasons:  (1)  willful  and  continued  failure
(other than any such failure  resulting from his incapacity during physical or
mental  illness)  to  substantially  perform his duties with the Company or an
Affiliate  continuing  30 days after  notice by the Company to the Optionee of
such   failure;   (2)  any  act  of   fraud,   misappropriation,   dishonesty,
embezzlement  or similar  conduct  against  the  Company or an  Affiliate,  as
finally  determined  through  arbitration  or  final  judgment  of a court  of
competent  jurisdiction (which arbitration or judgment,  due to the passage of
time or otherwise,  is not subject to further  appeal);  or (3)  conviction of
the Optionee for a felony or any other crime involving moral turpitude  (which
conviction,  due to the  passage  of  time or  otherwise,  is not  subject  to
further appeal).





      2.          Term And Exercise Of Option
                  ---------------------------

            (a)         Except  as  otherwise   provided  in  this  Agreement,
Optionee  shall have the right to exercise the Option from time to time during
the  Exercise  Period  with  respect to all or any part of the  vested  Option
Shares.  Election  of payment in shares may incur  extra  P.A.Y.E  withholding
taxes.
            (b)         (1)  As  a  condition  to   exercising   this  Option,
Optionee  must deliver to the President of the Company on any business day (A)
written  notice,  signed by the person  exercising the Option,  specifying the
number  of  Options  shares  being  exercised  and,  if  required  making  the
representations  and covenants in  substantially  the same form as provided in
the  Notice of  Exercise,  attached  as Exhibit A hereto;  (B) (i)  payment in
cash  or  (ii)  in  shares  of  Common  Stock  that  have  been  held  by  the
Optionee  for at least six months of the  Purchase  Price  (defined in Section
3); (C)  payment in cash of the tax  withholding  liability  arising  from the
exercise;  and (D) an executed shareholders'  agreement,  containing terms and
conditions  substantially  similar to any shareholders'  agreement executed by
and  applicable  to the holders of the  majority  of the share  holders of the
shares of Common Stock, if so required by the Committee.

                         (2) Upon receipt of such  notice and  payment in full
of  the  Purchase  Price and  tax  withholding  liability,  the  Company shall
cause to be  issued  a  certificate  representing  the  shares of Common Stock
purchased.

            (c)         Except as otherwise  provided in this  Agreement,  the
Option  shall  terminate  on the  earliest of (1) the last day of the Exercise
Period;  (2) the date the Committee  exercises its right pursuant to Section 8
to terminate the Option;  (3) thirty (30) days after Optionee  ceases to be an
Employee,  except if such  termination is due to Termination for Cause,  death
or Disability,  (4) one-hundred  eighty (180) days after Optionee ceases to be
an  Employee  if such  termination  is due to death or  Disability;  or (5) if
Optionee ceases to be an Employee as a result of a Termination for Cause,  the
time of such termination.

            (d)         The price paid by the Company  shall be payable at the
Company's  option (1) by delivery to the  Optionee of the entire  price in the
form of cash or check;  or (2) by payment of four  substantially  equal annual
installments,  the first  installment  being due at the date of termination of
the  Option and the  second,  third and  fourth  installment  being due on the
first,  second  and  third  anniversaries  of the date of  termination  of the
Option, respectively.

      3.          Purchase  Price.  Optionee  must  pay  to  the  Company  the
Exercise  Price  (subject to  adjustment  pursuant to Section 8) multiplied by
the number of the Option  Shares being  acquired  through the exercise of this
Option  (the  "Purchase  Price").  Shares  of  Common  Stock  tendered  by the
Optionee  in  satisfaction  of the  Purchase  Price shall be credited at their
Fair Market Value.

      4.          Non-Transferability  of Option.  Except for any  transfer of
the Option by bequest or  inheritance,  the Optionee  shall not have the right
to make or permit to exist any transfer or hypothecation,  whether outright or
as security, with or without consideration,  voluntary or involuntary,  of all
or any  part  of  any  right,  title  or  interest  in the  Option.  Any  such
disposition  not made in accordance  with this Agreement  shall be deemed null
and void.  The Option  shall be  exercisable  during the  lifetime of Optionee
only by  Optionee,  and  after  his  death  by a  legatee  or  legatees  under
Optionee's  last  will and  testament  or by his  personal  representative  or
representatives,  who shall be bound by the same  terms of this  Agreement  as
apply to the Optionee.

      5.          Restrictions  on  Transfer  of  Option  Shares.   Except  as
provided  in this  Agreement  or for any  transfer  of Option  Shares by gift,
bequest,  or  inheritance  to the  Optionee's  or a  subsequent  shareholder's
family  member,  estate,  heirs,  or  legatees or for any  transfer  after the
closing of an initial public offering of Common Stock,  the Optionee shall not
have the  right to make or  permit to exist  any  transfer  or  hypothecation,
whether outright or as security,  with or without consideration,  voluntary or
involuntary,  of all or any part of any right,  title or  interest  (including
but not  limited  to,  voting  rights)  in or to any Option  Shares.  Any such
disposition  not made in accordance  with this Agreement  shall be deemed null
and void.  Any permitted  transferee  under this Section shall be bound by the
same terms of this Agreement as apply to the Optionee.



      6.          No  Rights  as  Shareholder.   Optionee,  or  his  permitted
transferee  under  Section 4,  shall  have no  rights  as a  stockholder  with
respect to any Option Shares until the issuance of a stock  certificate to him
for such  shares.  No  adjustment  shall be made for  dividends  (ordinary  or
extraordinary,   whether   in  cash,   securities   or  other   property)   or
distributions  or other rights on or with respect to Option  Shares  purchased
pursuant  to this  Option  for which the  record  date is prior to the date of
exercise hereof, except as provided in Section 8 below.

      7.          Repurchase Rights.

            (a)         (1)   At all times  prior to the closing of an initial
public  offering of Common Stock,  or (2) within ninety (90) days  following a
Termination  for Cause,  the Company shall have the right to  repurchase  from
the Optionee all Option Shares.  For this purpose,  a notice of exercise given
by the Company to the  Optionee  pursuant to this Section 7 shall be effective
to  perfect  the  Company's  right of  repurchase,  subject  to the  remaining
provisions of this Section 7.

            (b)         (1)   The  Company  upon   exercising  this  right  of
repurchase  shall give written  notice to the Optionee of the number of shares
of Option Shares to be repurchased,  of the repurchase  price,  which shall be
determined  pursuant to Section 7(c)  hereof,  and of the time and date of the
closing of the repurchase of the Option  Shares,  which shall be no later than
sixty  (60)  days  from  the  date  of the  notice  and  shall  be held at the
principal  office of the Company.  At closing,  the Company  shall deliver the
application  portion of the  repurchase  price and the Optionee  shall deliver
the Option  Shares to be  repurchased  duly endorsed for transfer and with all
required revenue stamps attached,  and the title to the Option Shares shall be
transferred  to  the  Company  free  and  clear  of  all  liens,  claims,  and
encumbrances,   however   described,   except  for  restrictions   imposed  by
applicable securities laws.

                  (1)         If the Company  decides to repurchase  less than
all of the Option Shares owned by the Optionee,  the Company shall employ such
method  as it shall  deem  appropriate  in  determining  the  number of Option
Shares to be repurchased.

                  (2)         The price for Option Shares  repurchased  by the
Company  shall be payable by  delivery  to the  Optionee at the closing of the
entire repurchase price in the form of cash or check;  provided,  however, the
Company  may pay the  entire  repurchase  price  in four  substantially  equal
annual  installments  consisting of principal and interest at the "Prime Rate"
reported in the Wall Street  Journal on the first  business day  preceding the
date of  repurchase,  the first  installment  being due at the closing and the
second,  third, and fourth  installment  being due on the first,  second,  and
third anniversaries of the closing, respectively.

                  (3)         If the Optionee  fails to consummate the sale or
deliver the Option Shares certificates  properly assigned when requested to do
so, the Company, or its designee,  shall cancel the Option Shares certificates
of the Optionee  and deposit the payment  pursuant to Section  7(b)(3)  hereof
which was to be made to the Optionee in exchange for the  certificates  to the
credit or account of the Optionee with escrow with any  clearinghouse  bank in
the  City of  Greenville,  South  Carolina,  at the  expense  and  risk of the
Optionee, or his successors or assigns,  whereupon the Company shall treat the
Option Shares  represented  thereby as having been  repurchased by the Company
or its designees.

            (c)         The  repurchase  price for each Option  Share shall be
an amount  equal to the Fair  Market  Value,  except if the Option  Shares are
repurchased  by the Company  pursuant to written  notice given  within  ninety
(90) days  following a  Termination  for Cause,  in which case the  repurchase
price for each Option  Share  shall be the lower of Fair  Market  Value or the
Exercise Price paid by the Optionee.

      8.          Change  in  Capitalization.   The  total  number  of  Option
Shares to be received  upon  exercise of the Option  (both as to the number of
Option Shares and the Purchase Price) shall be appropriately  adjusted for any
change  in  par  value,   split-up,   stock   split,   reverse   stock  split,
reclassification,  merger,  consolidation,  distribution of stock dividends or
similar  capital  adjustments,  to the end that the  Optionee's  proportionate
interest in value shall be maintained  as before the  occurrence of the event.
The adjustment  shall be made without change in the total price  applicable to
the unexercised  portion of the Option and with a corresponding  adjustment in
the Exercise Price.

      The  foregoing   adjustments  and  the  manner  of  application  of  the
foregoing  provisions  shall  be  determined  by the  Committee  in  its  sole
discretion.  Any adjustment may provide for the  elimination of any fractional
Option Shares.

      Notwithstanding  any other  provision of this  Agreement,  the Committee
reserves the right in the event of a sale of  substantially  all of the Common
Stock or  property  of the  Company  or the  merger  or  consolidation  of the
Company,  or a  dissolution  or  liquidation  of the Company to terminate  the
Option in  consideration  of the  payment to the  Optionee  of the  difference
between (1) and (2) where (1) equals the Fair Market Value of the  unexercised
Option  Shares to the extent  vested and (2) equals the Purchase  Price of the
unexercised Option Shares to the extent vested.

      9.          Governing   Laws.   This   Agreement   shall  be  construed,
administered  and  enforced  according  to the laws of the State of  Delaware;
provided,  however,  the Option may not be exercised except, in the reasonable
judgment  of the Board of  Directors,  in  compliance  with  exemptions  under
applicable  securities laws of the country in which Optionee  resides,  and/or
any other  applicable  securities  laws. In addition,  the Participant  hereby
acknowledges  that this  Option  may have been  granted  prior to the time the
interest  represented  hereby was registered  under  applicable South Carolina
securities  laws and that, as a result,  the Participant may have the right to
rescind the grant of the Option.  This  Agreement,  therefore,  constitutes an
offer to so  rescind  the prior  grant for the  consideration  payable  to the
Optionee  specified  by  Section  35-1-1530  of  the  South  Carolina  Uniform
Securities  Act.   Because,   however,   the  Participant  has  not  paid  any
consideration  for the grant,  the Participant  desires to decline such offer,
and does hereby waive such right of rescission  with respect to this Option as
of the date  hereof.  The Company  agrees to use its best  efforts to register
the  Option  (as  well  as the  Stock  into  which  it is  convertible)  under
applicable  securities laws as soon as practicable,  and in any event prior to
the date on which any portion of the Option is vested hereunder.

      10.         Successors.  This  Agreement  shall  inure to the benefit of
the heirs,  legal  representatives,  successors  and permitted  assigns of the
Company and Optionee.

      11.         Notice.   Any  notice  which  either  party  hereto  may  be
required or  permitted  to give to the other  shall be in writing,  and may be
delivered  personally or by mail,  postage prepaid,  addressed as follows:  to
the President of the Company,  or to the Company (attention of the President),
at 50 Datastream  Plaza,  Greenville,  South Carolina  29605,  or at any other
address as the Company,  by notice to Optionee,  may designate in writing from
time to time; to Optionee,  at  Optionee's  address as shown on the records of
the Company,  or at any other  address as Optionee,  by notice to the Company,
may designate in writing from time to time.

      12.         Severability.  In the  event  that  any  one or  more of the
provisions  or  portion  thereof  contained  in this  Agreement  shall for any
reason be held to be invalid,  illegal or  unenforceable  in any respect,  the
same shall not  invalidate  or otherwise  affect any other  provisions of this
Agreement,  and this Agreement  shall be construed as if the invalid,  illegal
or unenforceable provision or portion thereof had never been contained herein.

      13.         Entire  Agreement.  Subject to the terms and  conditions  of
the Datastream  Systems,  Inc. 1997 Stock Option Plan,  which is  incorporated
herein by reference,  this Agreement  expresses the entire  understanding  and
agreement of the parties hereto with respect to such terms,  restrictions  and
limitations.

      14.         Headings.  Section  headings used herein are for convenience
of reference only and shall not be considered in construing this Agreement.

      15.         Specific  Performance.   In  the  event  of  any  actual  or
threatened  default  in,  or  breach  of,  any of the  terms,  conditions  and
provisions of this Agreement,  the party or parties who are thereby  aggrieved
shall have the right to specific  performance  and  injunction  in addition to
any and all  other  rights  and  remedies  at law or in  equity,  and all such
rights and remedies shall be cumulative.

      16.         Resolution    of    Disputes.     Any    determination    or
interpretation by the Committee shall be final,  binding and conclusive on all
persons affected thereby.

      17.         Compliance with Securities  Laws.  Notwithstanding  anything
contained  herein to the contrary,  no purported  exercise of the Option shall
be  effective  without  the  written  approval  of the  Company,  which may be
withheld  to the  extent  that its  exercise,  either  individually  or in the
aggregate  together  with the  exercise of other  previously  exercised  stock
options  and/or  offers  and  sales  pursuant  to any  prior  or  contemplated
offering  of  securities,  would,  in the sole and  absolute  judgment  of the
Company,  require  the  filing of a  registration  statement  with the  United
States Securities and Exchange Commission,  or with the securities  commission
of  any  state.  The  Company  shall  avail  itself  of  any  exemptions  from
registration  contained in applicable  TAX and securities  laws which,  in its
sole and absolute  discretion,  it deems reasonable and not unduly  burdensome
or costly.  The Optionee  shall deliver to the Company,  prior to the exercise
of  the  Option,  such  information,  representations  and  warranties  as the
Company  may  request in order for the  Company  to be able to satisfy  itself
that the Common  Stock to be acquired  pursuant to the  exercise of the Option
is being  acquired in  accordance  with the terms of an  applicable  exemption
from the securities registration requirements of applicable securities laws.

                                   * * * * *

<PAGE>
                               EXHIBIT 99.1(c)

                             TERMS AND CONDITIONS
                         OF DATASTREAM SYSTEMS, INC.
                       1997 EUROPEAN STOCK OPTION PLAN
                          FRENCH (SUB-PLAN) VERSION

      1.          Definitions
                  -----------

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

            (b)         "Disability"  means a disability  of an Optionee  such
that the  Optionee is entitled to  disability  retirement  benefits  under the
federal  Social  Security Act or such that the Optionee is entitled to recover
benefits  under any  long-term  disability  plan or policy  maintained  by the
Company or an  Affiliate.  The  determination  of whether a disability  exists
shall  be made by the  Committee  and  shall  be  substantiated  by  competent
medical advice.

            (c)         "Employee"  means any  person who is  employed  by the
Company or an Affiliate  for purposes of the Federal  Insurance  Contributions
Act.

            (d)         "Fair  Market  Value"  with regard to a date means the
closing  price at which  Common Stock shall have been sold on the last trading
date prior to that date as reported by the Nasdaq  National Market System (or,
if applicable,  as reported by a national  securities exchange selected by the
Committee  (as  defined in the Plan) on which the  shares of Common  Stock are
then  actively  traded) and  published  in The Wall Street  Journal;  provided
that,  for purposes of granting  Options other than  incentive  stock options,
Fair  Market  Value of the  shares of Common  Stock may be  determined  by the
Committee by reference to the average  market value  determined  over a period
certain or as of  specified  dates,  to a tender offer price for the shares of
Common Stock (if  settlement  of an award is triggered by such an event) or to
any other  reasonable  measure  of fair  market  value.  If at the time of the
determination  of Fair Market  Value  shares of Common  Stock are not actively
traded on any market described above,  Fair Market Value means the fair market
value of a share of Common Stock as determined  by the  Committee  taking into
account such facts and  circumstances  deemed to be material by the  Committee
to the  value of the  Common  Stock in the  hands of the  Optionee;  provided,
however,  for  purposes  of  determining  the  Option  price  per share for an
incentive  stock  option,  Fair  Market  Value  shall  be  determined  by  the
Committee  without regard to any restriction  other than a restriction  which,
by its  terms,  will never  lapse.  Fair  Market  Value as  determined  by the
Committee shall be final, binding and conclusive upon each Optionee.

            (e)         "Termination  for Cause"  means a  termination  of the
employment  relationship  between the Optionee and the Company or an Affiliate
due to any of  the  following  reasons:  (1)  willful  and  continued  failure
(other than any such failure  resulting from his incapacity during physical or
mental  illness)  to  substantially  perform his duties with the Company or an
Affiliate  continuing  30 days after  notice by the Company to the Optionee of
such   failure;   (2)  any  act  of   fraud,   misappropriation,   dishonesty,
embezzlement  or similar  conduct  against  the  Company or an  Affiliate,  as
finally  determined  through  arbitration  or  final  judgment  of a court  of
competent  jurisdiction (which arbitration or judgment,  due to the passage of
time or otherwise,  is not subject to further  appeal);  or (3)  conviction of
the Optionee for a felony or any other crime involving moral turpitude  (which
conviction,  due to the  passage  of  time or  otherwise,  is not  subject  to
further appeal).





      2.          Term and Exercise of Option

            (a)         Except  as  otherwise   provided  in  this  Agreement,
Optionee  shall have the right to exercise the Option from time to time during
the  Exercise  Period  with  respect to all or any part of the  vested  Option
Shares.  Election  of  payment in shares may incur  extra  French  withholding
taxes.

                        The sale of shares acquired  according to the plan may
occur any time  after  the  required  vesting  periods  have  been  satisfied,
however  sale of the shares  acquired  under the plan may lose  favorable  tax
treatment  if they are sold before being held for five years from the date the
option is granted.

            (b)         (1)  As  a  condition  to   exercising   this  Option,
Optionee  must deliver to the President of the Company on any business day (A)
written  notice,  signed by the person  exercising the Option,  specifying the
number  of  Options  shares  being  exercised  and,  if  required  making  the
representations  and covenants in  substantially  the same form as provided in
the  Notice of  Exercise,  attached  as Exhibit A hereto;  (B) (i)  payment in
cash  or  (ii)  in  shares  of  Common  Stock  that  have  been  held  by  the
Optionee  for at least six months of the  Purchase  Price  (defined in Section
3); (C)  payment in cash of the tax  withholding  liability  arising  from the
exercise;  and (D) an executed shareholders'  agreement,  containing terms and
conditions  substantially  similar to any shareholders'  agreement executed by
and  applicable  to the holders of the  majority  of the share  holders of the
shares of Common Stock, if so required by the Committee.

                        (2)  Upon receipt of  such  notice and payment in full
of the Purchase Price and tax withholding liability,  the  Company shall cause
to be issued a certificate representing the shares of Common Stock purchased.

                        (3)  Vesting   periods  are  determined  based  on the
number of shares granted per the schedule below:
 
            Number of Shares        Vesting period      %   vested  per year
            Less than  500                1 year                  100%
                      1000                2 years                  50%
                      2000                3 years                  33.3%
            More than 3000                4 years                  25%

            (c)         Except as otherwise  provided in this  Agreement,  the
Option  shall  terminate  on the  earliest of (1) the last day of the Exercise
Period;  (2) the date the Committee  exercises its right pursuant to Section 8
to terminate the Option;  (3) thirty (30) days after Optionee  ceases to be an
Employee,  except if such  termination is due to Termination for Cause,  death
or Disability,  (4) one-hundred  eighty (180) days after Optionee ceases to be
an  Employee  if such  termination  is due to death or  Disability;  or (5) if
Optionee ceases to be an Employee as a result of a Termination for Cause,  the
time of such termination.

            (d)         The price paid by the Company  shall be payable at the
Company's  option (1) by delivery to the  Optionee of the entire  price in the
form of cash or check;  or (2) by payment of four  substantially  equal annual
installments,  the first  installment  being due at the date of termination of
the  Option and the  second,  third and  fourth  installment  being due on the
first,  second  and  third  anniversaries  of the date of  termination  of the
Option, respectively.

      3.          Purchase  Price.  Optionee  must  pay  to  the  Company  the
Exercise  Price  (subject to  adjustment  pursuant to Section 8) multiplied by
the number of the Option  Shares being  acquired  through the exercise of this
Option  (the  "Purchase  Price").  Shares  of  Common  Stock  tendered  by the
Optionee  in  satisfaction  of the  Purchase  Price shall be credited at their
Fair Market Value.

      4.          Non-Transferability  of Option.  Except for any  transfer of
the Option by bequest or  inheritance,  the Optionee  shall not have the right
to make or permit to exist any transfer or hypothecation,  whether outright or
as security, with or without consideration,  voluntary or involuntary,  of all
or any  part  of  any  right,  title  or  interest  in the  Option.  Any  such
disposition  not made in accordance  with this Agreement  shall be deemed null
and void.  The Option  shall be  exercisable  during the  lifetime of Optionee
only by  Optionee,  and  after  his  death  by a  legatee  or  legatees  under
Optionee's  last  will and  testament  or by his  personal  representative  or
representatives,  who shall be bound by the same  terms of this  Agreement  as
apply to the Optionee.

      5.          Restrictions  on  Transfer  of  Option  Shares.   Except  as
provided  in this  Agreement  or for any  transfer  of Option  Shares by gift,
bequest,  or  inheritance  to the  Optionee's  or a  subsequent  shareholder's
family  member,  estate,  heirs,  or  legatees or for any  transfer  after the
closing of an initial public offering of Common Stock,  the Optionee shall not
have the  right to make or  permit to exist  any  transfer  or  hypothecation,
whether outright or as security,  with or without consideration,  voluntary or
involuntary,  of all or any part of any right,  title or  interest  (including
but not  limited  to,  voting  rights)  in or to any Option  Shares.  Any such
disposition  not made in accordance  with this Agreement  shall be deemed null
and void.  Any permitted  transferee  under this Section shall be bound by the
same terms of this Agreement as apply to the Optionee.

      6.          No  Rights  as  Shareholder.   Optionee,  or  his  permitted
transferee  under  Section 4,  shall  have no  rights  as a  stockholder  with
respect to any Option Shares until the issuance of a stock  certificate to him
for such  shares.  No  adjustment  shall be made for  dividends  (ordinary  or
extraordinary,   whether   in  cash,   securities   or  other   property)   or
distributions  or other rights on or with respect to Option  Shares  purchased
pursuant  to this  Option  for which the  record  date is prior to the date of
exercise hereof, except as provided in Section 8 below.

      7.          Repurchase Rights.

            (a)         (1)   At all times  prior to the closing of an initial
public  offering of Common Stock,  or (2) within ninety (90) days  following a
Termination  for Cause,  the Company shall have the right to  repurchase  from
the Optionee all Option Shares.  For this purpose,  a notice of exercise given
by the Company to the  Optionee  pursuant to this Section 7 shall be effective
to  perfect  the  Company's  right of  repurchase,  subject  to the  remaining
provisions of this Section 7.

            (b)         (1)   The  Company  upon   exercising  this  right  of
repurchase  shall give written  notice to the Optionee of the number of shares
of Option Shares to be repurchased,  of the repurchase  price,  which shall be
determined  pursuant to Section 7(c)  hereof,  and of the time and date of the
closing of the repurchase of the Option  Shares,  which shall be no later than
sixty  (60)  days  from  the  date  of the  notice  and  shall  be held at the
principal  office of the Company.  At closing,  the Company  shall deliver the
application  portion of the  repurchase  price and the Optionee  shall deliver
the Option  Shares to be  repurchased  duly endorsed for transfer and with all
required revenue stamps attached,  and the title to the Option Shares shall be
transferred  to  the  Company  free  and  clear  of  all  liens,  claims,  and
encumbrances,   however   described,   except  for  restrictions   imposed  by
applicable securities laws.

                  (1)         If the Company  decides to repurchase  less than
all of the Option Shares owned by the Optionee,  the Company shall employ such
method  as it shall  deem  appropriate  in  determining  the  number of Option
Shares to be repurchased.

                  (2)         The price for Option Shares  repurchased  by the
Company  shall be payable by  delivery  to the  Optionee at the closing of the
entire repurchase price in the form of cash or check;  provided,  however, the
Company  may pay the  entire  repurchase  price  in four  substantially  equal
annual  installments  consisting of principal and interest at the "Prime Rate"
reported in the Wall Street  Journal on the first  business day  preceding the
date of  repurchase,  the first  installment  being due at the closing and the
second,  third, and fourth  installment  being due on the first,  second,  and
third anniversaries of the closing, respectively.

                  (3)         If the Optionee  fails to consummate the sale or
deliver the Option Shares certificates  properly assigned when requested to do
so, the Company, or its designee,  shall cancel the Option Shares certificates
of the Optionee  and deposit the payment  pursuant to Section  7(b)(3)  hereof
which was to be made to the Optionee in exchange for the  certificates  to the
credit or account of the Optionee with escrow with any  clearinghouse  bank in
the  City of  Greenville,  South  Carolina,  at the  expense  and  risk of the
Optionee, or his successors or assigns,  whereupon the Company shall treat the
Option Shares  represented  thereby as having been  repurchased by the Company
or its designees.

            (c)         The  repurchase  price for each Option  Share shall be
an amount  equal to the Fair  Market  Value,  except if the Option  Shares are
repurchased  by the Company  pursuant to written  notice given  within  ninety
(90) days  following a  Termination  for Cause,  in which case the  repurchase
price for each Option  Share  shall be the lower of Fair  Market  Value or the
Exercise Price paid by the Optionee.

      8.          Change  in  Capitalization.   The  total  number  of  Option
Shares to be received  upon  exercise of the Option  (both as to the number of
Option Shares and the Purchase Price) shall be appropriately  adjusted for any
change  in  par  value,   split-up,   stock   split,   reverse   stock  split,
reclassification,  merger,  consolidation,  distribution of stock dividends or
similar  capital  adjustments,  to the end that the  Optionee's  proportionate
interest in value shall be maintained  as before the  occurrence of the event.
The adjustment  shall be made without change in the total price  applicable to
the unexercised  portion of the Option and with a corresponding  adjustment in
the Exercise Price.

      The  foregoing   adjustments  and  the  manner  of  application  of  the
foregoing  provisions  shall  be  determined  by the  Committee  in  its  sole
discretion.  Any adjustment may provide for the  elimination of any fractional
Option Shares.

      Notwithstanding  any other  provision of this  Agreement,  the Committee
reserves the right in the event of a sale of  substantially  all of the Common
Stock or  property  of the  Company  or the  merger  or  consolidation  of the
Company,  or a  dissolution  or  liquidation  of the Company to terminate  the
Option in  consideration  of the  payment to the  Optionee  of the  difference
between (1) and (2) where (1) equals the Fair Market Value of the  unexercised
Option  Shares to the extent  vested and (2) equals the Purchase  Price of the
unexercised Option Shares to the extent vested.

      9.          Governing   Laws.   This   Agreement   shall  be  construed,
administered  and  enforced  according  to the laws of the State of  Delaware;
provided,  however,  the Option may not be exercised except, in the reasonable
judgment  of the Board of  Directors,  in  compliance  with  exemptions  under
applicable  securities laws of the country in which Optionee  resides,  and/or
any other  applicable  securities  laws. In addition,  the Participant  hereby
acknowledges  that this  Option  may have been  granted  prior to the time the
interest  represented  hereby was registered  under  applicable South Carolina
securities  laws and that, as a result,  the Participant may have the right to
rescind the grant of the Option.  This  Agreement,  therefore,  constitutes an
offer to so  rescind  the prior  grant for the  consideration  payable  to the
Optionee  specified  by  Section  35-1-1530  of  the  South  Carolina  Uniform
Securities  Act.   Because,   however,   the  Participant  has  not  paid  any
consideration  for the grant,  the Participant  desires to decline such offer,
and does hereby waive such right of rescission  with respect to this Option as
of the date  hereof.  The Company  agrees to use its best  efforts to register
the  Option  (as  well  as the  Stock  into  which  it is  convertible)  under
applicable  securities laws as soon as practicable,  and in any event prior to
the date on which any portion of the Option is vested hereunder.

      10.         Successors.  This  Agreement  shall  inure to the benefit of
the heirs,  legal  representatives,  successors  and permitted  assigns of the
Company and Optionee.

      11.         Notice.   Any  notice  which  either  party  hereto  may  be
required or  permitted  to give to the other  shall be in writing,  and may be
delivered  personally or by mail,  postage prepaid,  addressed as follows:  to
the President of the Company,  or to the Company (attention of the President),
at 50 Datastream  Plaza,  Greenville,  South Carolina  29605,  or at any other
address as the Company,  by notice to Optionee,  may designate in writing from
time to time; to Optionee,  at  Optionee's  address as shown on the records of
the Company,  or at any other  address as Optionee,  by notice to the Company,
may designate in writing from time to time.

      12.         Severability.  In the  event  that  any  one or  more of the
provisions  or  portion  thereof  contained  in this  Agreement  shall for any
reason be held to be invalid,  illegal or  unenforceable  in any respect,  the
same shall not  invalidate  or otherwise  affect any other  provisions of this
Agreement,  and this Agreement  shall be construed as if the invalid,  illegal
or unenforceable provision or portion thereof had never been contained herein.

      13.         Entire  Agreement.  Subject to the terms and  conditions  of
the Datastream  Systems,  Inc. 1997 Stock Option Plan,  which is  incorporated
herein by reference,  this Agreement  expresses the entire  understanding  and
agreement of the parties hereto with respect to such terms,  restrictions  and
limitations.

      14.         Headings.  Section  headings used herein are for convenience
of reference only and shall not be considered in construing this Agreement.

      15.         Specific  Performance.   In  the  event  of  any  actual  or
threatened  default  in,  or  breach  of,  any of the  terms,  conditions  and
provisions of this Agreement,  the party or parties who are thereby  aggrieved
shall have the right to specific  performance  and  injunction  in addition to
any and all  other  rights  and  remedies  at law or in  equity,  and all such
rights and remedies shall be cumulative.

      16.         Resolution    of    Disputes.     Any    determination    or
interpretation by the Committee shall be final,  binding and conclusive on all
persons affected thereby.

      17.         Compliance with Securities  Laws.  Notwithstanding  anything
contained  herein to the contrary,  no purported  exercise of the Option shall
be  effective  without  the  written  approval  of the  Company,  which may be
withheld  to the  extent  that its  exercise,  either  individually  or in the
aggregate  together  with the  exercise of other  previously  exercised  stock
options  and/or  offers  and  sales  pursuant  to any  prior  or  contemplated
offering  of  securities,  would,  in the sole and  absolute  judgment  of the
Company,  require  the  filing of a  registration  statement  with the  United
States Securities and Exchange Commission,  or with the securities  commission
of  any  state.  The  Company  shall  avail  itself  of  any  exemptions  from
registration  contained in applicable  tax and securities  laws which,  in its
sole and absolute  discretion,  it deems reasonable and not unduly  burdensome
or costly.  The Optionee  shall deliver to the Company,  prior to the exercise
of  the  Option,  such  information,  representations  and  warranties  as the
Company  may  request in order for the  Company  to be able to satisfy  itself
that the Common  Stock to be acquired  pursuant to the  exercise of the Option
is being  acquired in  accordance  with the terms of an  applicable  exemption
from the securities registration requirements of applicable securities laws.

                                   * * * * *

<PAGE>
                                 EXHIBIT 99.2

                           DATASTREAM SYSTEMS, INC.
                            1998 STOCK OPTION PLAN

                            SECTION I. DEFINITIONS

      Whenever used herein,  the masculine  pronoun shall be deemed to include
the  feminine,  and the  singular to include  the  plural,  unless the context
clearly indicates otherwise,  and the following  capitalized words and phrases
are used herein with the meaning thereafter ascribed:

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

      1.2   "Change of Control" means (i) an acquisition by any individual,
entity or group (within the meaning of Sections 13(d)(3) or 14(d)(2) of the
Exchange Act (a "Person") of beneficial ownership of 50 percent or more of
the total outstanding Voting Securities of the Company, other than any
acquisition by the Company or any employee benefit plan that the Company
sponsors, (ii) any sale, exchange, merger, consolidation, reorganization,
tender offer for shares of Stock or other similar business transaction
involving the Company (a "business transaction"), unless, following such
business transaction, more than 50 percent of the total outstanding Voting
Securities of the Company (or other entity surviving such business
transaction) is then beneficially owned, directly or indirectly, by all or
substantially all of the Persons who were beneficial owners of the Voting
Securities of the Company immediately before such business transaction, and
(iii) the sale or other disposition of all or substantially all of the assets
of the Company, other than to a corporation with respect to which following
such sale or other disposition more than 50 percent of the total outstanding
Voting Securities of such corporation is then beneficially owned, directly or
indirectly, by all or substantially all of the Persons who were beneficial
owners of the Voting Securities of the Company immediately before such sale
or other disposition.

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

      1.4   "Committee"  means  the  committee   consisting  of  two  or  more
Non-Employee Directors appointed by the Board to administer the Plan.

      1.5   "Company" means Datastream Systems, Inc., a Delaware corporation.

      1.6   "Disposition" means any conveyance,  sale,  transfer,  assignment,
pledge or  hypothecation,  whether  outright  or as  security,  inter vivos or
testamentary, with or without consideration, voluntary or involuntary.

      1.7   "Exchange  Act"  means the  Securities  Exchange  Act of 1934,  as
amended from time to time.

      1.8   "Exercise  Price"  means the price per share of Stock  purchasable
under any Option.

      1.9   "Fair Market  Value" with regard to a date means the closing price
at which  Stock  shall have been sold on the last  trading  date prior to that
date as reported by the Nasdaq National  Market System (or, if applicable,  as
reported by a national  securities exchange selected by the Committee on which
the  shares of Stock  are then  actively  traded)  and  published  in The Wall
Street  Journal;  provided that,  for purposes of granting  Options other than
incentive  stock  options,  Fair  Market  Value of the  shares of Stock may be
determined  by  the  Committee  by  reference  to  the  average  market  value
determined  over a period certain or as of specified  dates, to a tender offer
price for the shares of Stock (if  settlement of an award is triggered by such
an event) or to any other  reasonable  measure of fair market value. If at the
time of the  determination  of Fair  Market  Value  shares  of  Stock  are not
actively  traded on any market  described  above,  Fair Market Value means the
fair market value of a share of Stock as determined  by the  Committee  taking
into  account  such  facts  and  circumstances  deemed to be  material  by the
Committee  to  the  value  of  the  Stock  in the  hands  of the  Participant;
provided,  however, for purposes of determining the Option price per share for
an  incentive  stock  option,  Fair Market  Value shall be  determined  by the
Committee  without regard to any restriction  other than a restriction  which,
by its  terms,  will never  lapse.  Fair  Market  Value as  determined  by the
Committee shall be final, binding and conclusive upon each Participant.

      1.10  "Non-Employee  Director" means a director who (i) is not a current
employee or officer of the Company or any of its  Subsidiaries,  and has never
been an  officer  of the  Company or any of its  Subsidiaries,  (ii) does  not
receive compensation,  either directly or indirectly,  from the Company or any
of its  Subsidiaries  for services  rendered in any  capacity  other than as a
director,  (iii) does not  possess an interest  in any other  transaction  for
which  disclosure  would  be  required   pursuant  to  Regulation  S-K  404(a)
promulgated  under the  Exchange  Act, and (iv) is not engaged in any business
relationship  for which  disclosure  would be required  pursuant to Regulation
S-K 404(b) promulgated under the Exchange Act.

      1.11  "Option" means a non-qualified  stock option or an incentive stock
option.

      1.12  "Over 10% Owner" means an individual  who at the time an incentive
stock  option is  granted  owns  Stock  possessing  more than 10% of the total
combined  voting power of the Company or one of its  Subsidiaries,  determined
by applying the attribution rules of Code Section 424(d).

      1.13  "Participant"   means  an   individual   who  receives  an  Option
hereunder.

      1.14  "Plan" means the Datastream Systems, Inc. 1998 Stock Option Plan.

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

      1.16  "Stock" means the Company's common stock, $.01 par value.

      1.17  "Stock Option  Agreement"  means an agreement  between the Company
and a Participant or other documentation evidencing an award of an Option.

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

      1.19  "Voting  Securities"  means  the  shares  of  capital  stock of an
entity entitled to vote generally in the election of that entity's directors.

                             SECTION 2. THE PLAN

      2.1   Purpose  of  the  Plan.  The  Plan  is  intended  to  (a)  provide
incentive  to  selected  employees  and  consultants  of the  Company  and its
Subsidiaries  to stimulate  their efforts toward the continued  success of the
Company  and to operate  and manage the  business  of the  Company in a manner
that will provide for the long-term  growth and  profitability of the Company;
(b)  encourage  stock  ownership  by selected  employees  and  consultants  by
providing them with a means to acquire a proprietary  interest in the Company;
and  (c)  provide  a  means  of  obtaining,  rewarding  and  retaining  select
employees and consultants.

      2.2   Stock  Subject to the Plan.  Subject to  adjustment  in accordance
with Section 4.2 hereof,  500,000  shares of Stock (the "Maximum Plan Shares")
are hereby reserved  exclusively for issuance pursuant to Options.  At no time
shall the  Company  have  outstanding  Options  and shares of Stock  issued in
respect  of Options  granted  under  this Plan in excess of the  Maximum  Plan
Shares;  for this purpose,  the shares of Stock attributable to the nonvested,
unpaid, unexercised,  unconverted or otherwise unsettled portion of any Option
that is forfeited or canceled or expires or terminates  for any reason without
becoming  vested,  paid,  exercised,  converted or  otherwise  settled in full
shall again be available for purposes of the Plan.

      2.3   Administration  of the Plan.  The Plan  shall be  administered  by
the  Committee.  The Committee  shall have full authority in its discretion to
determine  the  persons to whom  Options  shall be  granted  and the terms and
provisions of Options,  subject to the Plan.  Subject to the provisions of the
Plan, the Committee shall have full and conclusive  authority to interpret the
Plan; to prescribe,  amend and rescind rules and  regulations  relating to the
Plan; to determine the terms and  provisions  of the  respective  Stock Option
Agreements,  to accelerate the time at which Options can be exercised,  and to
make  all  other   determinations   necessary  or  advisable  for  the  proper
administration  of the Plan.  The  Committee's  determinations  under the Plan
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).  The  Committee's  decisions  shall be
final and binding on all Participants.

      2.4   Eligibility  and Limits.  Options may be granted only to employees
and consultants of the Company and its Subsidiaries;  provided,  however, that
an  incentive  stock  option may only be granted to an employee of the Company
or any  Subsidiary.  Only  directors who are also employees of the Company may
receive  grants of Options  under this Plan.  In the case of  incentive  stock
options,  if the  aggregate  Fair Market Value  (determined  as of the date an
incentive  stock  option is  granted) of Stock with  respect to which  Options
intended to meet the  requirements of Code Section 422 become  exercisable for
the first time by an  individual  during any calendar  year under all plans of
the  Company  and its  Subsidiaries  exceeds  $100,000,  then  the  number  of
incentive  stock  option(s)  granted  under this Plan which cause the $100,000
limitation to be exceeded shall be treated as non-qualified stock option(s).

                         SECTION 3. TERMS OF OPTIONS

      3.1   Terms and  Conditions of Options.  No more than 500,000  shares of
Stock shall be reserved and available for issuance as Options under the Plan.

            3.1.1 Number of Option  Shares.  The  number of shares of Stock as
      to  which  an  Option  shall  be  granted  shall  be  determined  by the
      Committee in its sole  discretion,  subject to the provisions of Section
      2.2 as to the total  number of shares  available  for  grants  under the
      Plan.  Notwithstanding  the  preceding,  to the  extent  required  under
      Section  162(m)  of  the  Code  and  the   regulations   thereunder  for
      compensation to be treated as qualified performance-based  compensation,
      the maximum  number of shares of Stock with respect to which Options may
      be granted  during any one year period to any employee  shall not exceed
      200,000.

            3.1.2 Stock  Option  Agreement.  Each Option shall be evidenced by
      a Stock  Option  Agreement  in such  form  and  containing  such  terms,
      conditions  and  restrictions  as  the  Committee  may  determine  to be
      appropriate.  Each Stock Option  Agreement shall be subject to the terms
      of the Plan and any provisions  contained in the Stock Option  Agreement
      that are inconsistent with the Plan shall be null and void.

            3.1.3 Type of  Option.  At the time any  Option  is  granted,  the
      Committee  shall  determine  whether  the  Option is  intended  to be an
      incentive stock option  described in Code Section 422 or a non-qualified
      stock  option that is not  governed by Code  Section 422, and the Option
      shall be  clearly  identified  as to its  status as an  incentive  stock
      option  or a  non-qualified  stock  option.  At the time  any  incentive
      stock option  granted under the Plan is exercised,  the Company shall be
      entitled  to legend the  certificates  representing  the shares of Stock
      purchased   pursuant  to  the  Option  to  clearly   identify   them  as
      representing  the shares  purchased  upon the  exercise of an  incentive
      stock option.  An incentive  stock option may only be granted  within 10
      years  from the  earlier of the date the Plan is adopted by the Board or
      approved by the Company's stockholders.

            3.1.4 Exercise  Price.  Subject to adjustment  in accordance  with
      Section 4.2 and the other  provisions  of this  Section 3, the  Exercise
      Price of an Option shall be as set forth in the applicable  Stock Option
      Agreement.  Notwithstanding  the preceding,  the Exercise Price under an
      incentive  stock  option shall not be less than the Fair Market Value of
      the  underlying  Stock on the  date  the  Option  is  granted,  and with
      respect to each grant of an incentive  stock option to a Participant who
      is an Over 10% Owner,  the Exercise Price shall not be less than 110% of
      the Fair Market Value of the underlying  Stock on the date the Option is
      granted.

            3.1.5 Option  Term.  Any  incentive  stock  option  granted  to  a
      Participant who is not an Over 10% Owner shall not be exercisable  after
      the  expiration  of 10 years after the date the Option is  granted.  Any
      incentive  stock  option  granted  to a  Participant  who is an Over 10%
      Owner shall not be exercisable  after the expiration of five years after
      the date the  Option is  granted.  The term of any  non-qualified  stock
      option shall be as specified in the applicable Stock Option Agreement.

            3.1.6 Payment.   Payment   for  all  shares  of  Stock   purchased
      pursuant  to the  exercise  of an  Option  shall  be made in any form or
      manner  authorized  by the  Committee  in the  Stock  Option  Agreement,
      including,  but not  limited  to,  (i)  cash,  (ii) by  delivery  to the
      Company  of a number  of shares of Stock  which  have been  owned by the
      Participant  for at least  six  months  prior  to the  date of  exercise
      having an  aggregate  Fair Market  Value of not less than the product of
      the Exercise  Price  multiplied by the number of shares the  Participant
      intends  to  purchase  upon  exercise  of  the  Option  on the  date  of
      delivery;  (iii) in a  cashless  exercise  through a broker;  or (iv) by
      having a number of shares of Stock  withheld,  the Fair Market  Value of
      which as of the date of exercise is  sufficient  to satisfy the Exercise
      Price.  In its  discretion,  the  Committee  also may  authorize (at the
      time an Option is granted or  thereafter)  Company  financing  to assist
      the  Participant  as to payment of the  Exercise  Price on such terms as
      may be offered by the Committee in its  discretion.  Any such  financing
      shall require the payment by the  Participant  of interest on the amount
      financed  at a rate not less than the  "applicable  federal  rate" under
      the Code. If a Stock Option  Agreement so provides,  the Participant may
      be  granted a new Option to  purchase a number of shares of Stock  equal
      to the number of  previously-owned  shares of Stock  tendered in payment
      for each  share of Stock  purchased  pursuant  to the terms of the Stock
      Option  Agreement.  Any such new  Option  shall be  subject to the terms
      and conditions of the Stock Option Agreement  pursuant to which such new
      Option is granted.  Payment of the  Exercise  Price shall be made at the
      time the  Option  or any part  thereof  is  exercised,  and no shares of
      Stock shall be issued or  delivered  upon  exercise  of an Option  until
      full  payment  has  been  made  by the  Participant.  The  holder  of an
      Option,  as such,  shall have none of the rights of a stockholder  until
      delivery of the  certificate(s)  representing  the Stock the Participant
      has purchased.

            3.1.7 Conditions  to the Exercise of an Option.  Each Option shall
      be  exercisable by the  Participant  at such time or times,  or upon the
      occurrence  of  such  event  or  events,  and in  such  amounts,  as the
      Committee  shall  specify  in  the  Stock  Option  Agreement;  provided,
      however,  that subsequent to the grant of an Option,  the Committee,  at
      any time before complete  termination of such Option, may accelerate the
      time or times at  which  such  Option  may be  exercised  in whole or in
      part, and may permit the Participant or any other  designated  person to
      exercise  the  Option,  or any portion  thereof,  for all or part of the
      remaining  Option  term,  notwithstanding  any  provision  of the  Stock
      Option Agreement to the contrary.

            3.1.8 Termination  of Incentive  Stock Option.  With respect to an
      incentive  stock option,  in the event of termination of employment of a
      Participant  for any reason other than death or  disability,  the Option
      or portion  thereof held by the Participant  which is unexercised  shall
      expire,   terminate,   and  become   unexercisable  no  later  than  the
      expiration of three months after the date of  termination of employment;
      provided,  however,  that in the case of a holder whose  termination  of
      employment  is  due  to  death  or  disability   ("disability"   meaning
      "disabled" within the meaning of Code Section 22(e)(3)),  one year shall
      be  substituted  for such  three  month  period.  For  purposes  of this
      Subsection  3.1.8,  termination of employment of the  Participant  shall
      not be  deemed  to have  occurred  if the  Participant  is  employed  by
      another  corporation  (or a parent  or  subsidiary  corporation  of such
      other  corporation)  which has assumed the incentive stock option of the
      Participant in a transaction to which Code Section 424(a) is applicable.

            3.1.9 Special   Provisions   for   Certain   Substitute   Options.
      Notwithstanding  anything to the  contrary in this Section 3, any Option
      issued in  substitution  for an  option  previously  issued  by  another
      entity,  which  substitution  occurs in connection with a transaction to
      which Code  Section  424(a) is  applicable,  may provide for an exercise
      price computed in accordance  with such Code Section and the regulations
      thereunder  and may  contain  such  other  terms and  conditions  as the
      Committee  may prescribe to cause such  substitute  Option to contain as
      nearly  as  possible  the  same  terms  and  conditions  (including  the
      applicable  vesting and  termination  provisions) as those  contained in
      the previously-issued option being replaced thereby.

            3.1.10      Date of Grant.  The date an Option  is  granted  shall
      be  the  date  on  which  the  Committee  has  approved  the  terms  and
      conditions of the Option and has  determined the recipient of the Option
      and the  number of shares  covered  by the Option and has taken all such
      other action necessary to complete the grant of the Option.

            3.1.11      Nonassignability.  Options  shall not be  transferable
      or   assignable   except  by  will  or  by  the  laws  of  descent   and
      distribution.   Such   Options   shall  be   exercisable,   during   the
      Participant's lifetime, only by the Participant;  or in the event of the
      death  of  the  Participant,   by  the  legal   representatives  of  the
      Participant's  estate or if no legal  representative has been appointed,
      by the successor in interest  determined under the  Participant's  will.
      Notwithstanding  the two prior  sentences,  however,  if the  applicable
      Stock Option Agreement so provides,  a Participant may assign all or any
      portion  of an  Option  granted  to him that is not an  incentive  stock
      option to (i) his spouse or lineal descendants,  (ii) one or more trusts
      for  the   benefit  of  his  spouse  or  lineal   descendants,   (iii) a
      partnership  of which  his  spouse or  lineal  descendants  are the only
      partners,   or  (iv) a  tax  exempt   organization   as   described   in
      Section 501(c)(3)  of the Code,  as may be  permitted  under  Securities
      Exchange  Commission  Rule 16b-3 as in effect from time to time. In that
      event, the spouse, lineal descendant,  trust,  partnership or tax exempt
      organization  will be entitled  to all of the rights of the  Participant
      with  respect to the assigned  portion of such  Option,  and such Option
      will  continue  to be  subject to all of the terms and  conditions  that
      governed  the  Option  during  the  period  that  it  was  held  by  the
      Participant;  provided,  however,  that such  assignee  may not  further
      assign  the  Option  except  by  will  or by the  laws  of  descent  and
      distribution.  Any  such  assignment  will  be  permitted  only  if  the
      Participant    does   not   receive   any    consideration    therefore.
      Additionally,  in  order  for  an  assignment  by a  Participant  to  be
      effective,  (i) at  least 30 days prior to the date of  assignment,  the
      Participant  must  notify  the  Company  in  writing  of the date of the
      assignment,  the Option or portion  thereof to be assigned and the name,
      address,    telephone   number   and   social   security   or   employer
      identification  number of the assignee,  (ii) at the time of assignment,
      the Participant must execute an appropriate  written  agreement that the
      Company  provides to evidence the  assignment  and to agree to remit any
      applicable  withholding the Company may require and (iii) at the time of
      assignment,  the  assignee  pursuant  to a  written  agreement  that the
      Company  provides  must  agree  to  be  bound  by  the  same  terms  and
      conditions  that  governed  the Option  during the period it was held by
      the Participant.

      3.2   Treatment  of Option Upon  Termination  of  Employment.  Except as
otherwise  provided  by  Plan  Subsection  3.1.8,  any  Option  granted  to  a
Participant  whose  employment  with the  Company has been  terminated  may be
canceled,  accelerated  or  continued,  as  provided in the  applicable  Stock
Option Agreement,  or, in the absence of such provision,  as the Committee may
determine.  The portion of any grant  exercisable in the event of continuation
may be  adjusted  by the  Committee  to reflect  the  Participant's  period of
service  from  the  date  of  grant  through  the  date  of the  Participant's
termination  of employment  or such other factors as the Committee  determines
are relevant to its decision to continue the award.

                        SECTION 4. GENERAL PROVISIONS

      4.1   Withholding.  Whenever  the  Company  proposes  or is  required to
issue or transfer  shares of Stock under the Plan,  the Company  shall require
the  recipient  to remit to the  Company,  as a condition  to  exercising  the
Option,  an  amount  sufficient  to  satisfy  any  federal,  state  and  local
withholding  tax  requirements  prior to the  delivery of any  certificate  or
certificates  for such shares.  A  Participant  may pay the  withholding  tax:
(i) in cash;  (ii) if the Stock Option  Agreement so provides,  by delivery to
the Company of a number of shares of Common  Stock which has been owned by the
Participant for at least six months prior to the date of exercise which,  when
multiplied  by the Fair Market Value of the shares of Stock  determined  as of
the Tax Date (defined  below),  is sufficient  to satisfy  federal,  state and
local, if any,  withholding taxes arising from exercise of an Option; or (iii)
if the Stock Option  Agreement so provides,  a  Participant  may elect to have
the number of shares of Stock he is to receive  reduced by the smallest number
of whole shares of Stock which,  when  multiplied  by the Fair Market Value of
the shares of Stock  determined  as of the Tax Date is  sufficient  to satisfy
federal,  state and local, if any,  withholding taxes arising from exercise of
an Option  (clauses  (ii) and (iii) each being a  "Withholding  Election").  A
Participant  may make a  Withholding  Election  only if both of the  following
conditions are met:

            4.1.1 The  Withholding  Election  must be made on or  prior to the
      date on which the amount of tax  required to be  withheld is  determined
      (the "Tax Date") by executing  and  delivering to the Company a properly
      completed   notice  of   Withholding   Election  as  prescribed  by  the
      Committee; and

            4.1.2 Any Withholding  Election made will be irrevocable except on
      six months  advance  written notice  delivered to the Company;  however,
      the Committee may in its sole  discretion  disapprove and give no effect
      to the Withholding Election.

      4.2   Changes In Capitalization; Merger; Liquidation.
            -----------------------------------------------

            4.2.1 The  number  of shares  of Stock  reserved  for the grant of
      Options;  the number of shares of Stock  reserved for issuance  upon the
      exercise or payment, as applicable,  of each outstanding Option; and the
      Exercise  Price of each  outstanding  Option  shall  be  proportionately
      adjusted for any increase or decrease in the number of issued  shares of
      Stock  resulting from a subdivision or combination of shares of Stock or
      the  payment  of a stock  dividend  in  shares  of Stock to  holders  of
      outstanding  shares of Stock or any other  increase  or  decrease in the
      number  of shares  of Stock  outstanding  effected  without  receipt  of
      consideration by the Company.

            4.2.2 In the event of or in anticipation of a sale, exchange,
      merger, consolidation, reorganization, tender offer for shares of Stock
      or other similar business transaction involving the Company, the
      Committee may make such adjustments with respect to awards and take
      such other action as it deems necessary or appropriate to reflect such
      sale, exchange, merger, consolidation, reorganization, tender offer or
      other similar business transaction including, without limitation, the
      substitution of new awards, the termination or adjustment of
      outstanding awards, the acceleration of awards, or the removal of
      restrictions on outstanding awards. Notwithstanding the foregoing
      sentence, however, in the event of or in anticipation of a sale,
      exchange, merger, consolidation, reorganization, tender offer for
      shares of Stock or other similar business transaction involving the
      Company that would result in a Change of Control, any Option granted
      hereunder shall become immediately exercisable in full, and shall
      remain so, regardless of any provisions contained in the applicable
      Stock Option Agreement with respect thereto limiting the exercisability
      of the Option for any length of time or terminating the Option prior to
      the expiration of its remaining term, subject to all the terms hereof
      and of the Stock Option Agreement with respect thereto not inconsistent
      with this sentence. Any adjustment pursuant to this Section 4.2 may
      provide, in the Committee's discretion, for the elimination without
      payment therefor of any fractional shares that might otherwise become
      subject to any Option, but shall not otherwise diminish the
      then-current value of the Option.

            4.2.3 The existence of the Plan and the Options  granted  pursuant
      to the Plan  shall not limit or  otherwise  adversely  affect in any way
      the right or power of the Company to make or authorize  any  adjustment,
      reclassification,  reorganization  or other  change  in its  capital  or
      business  structure,  any merger or  consolidation  of the Company,  any
      issue of debt or equity securities  having  preferences or priorities as
      to the Stock or the rights  thereof,  the  dissolution or liquidation of
      the Company,  any sale or transfer of all or any part of its business or
      assets, or any other corporate act or proceeding.

      4.3   Cash  Awards.   The  Committee   may,  at  any  time  and  in  its
discretion,  grant to any  holder of an Option the right to  receive,  at such
times and in such amounts as determined by the Committee in its discretion,  a
cash amount  which is intended to  reimburse  such person for all or a portion
of the federal,  state and local  income  taxes  imposed upon such person as a
consequence of the receipt of the Option or the exercise of rights thereunder.

      4.4   Compliance  with Code.  All incentive  stock options to be granted
hereunder are intended to comply with Code Section 422, and all  provisions of
the Plan and all incentive stock options granted  hereunder shall be construed
in such a manner as to  effectuate  that  intent.  However,  no Option that is
intended  to be an  incentive  stock  option  shall be invalid  for failure to
qualify as an incentive stock option.  A Participant  shall notify the Company
of any sale or other  Disposition of Stock  acquired  pursuant to an incentive
stock option if such sale or other Disposition  occurs (i) within two years of
grant of the  incentive  stock  option or (ii) within one year of the issuance
of the  Stock  to  the  Participant.  Such  notice  shall  be in  writing  and
directed to the Secretary of the Company.

      4.5   Right  to  Terminate  Employment.  Nothing  in the  Plan or in any
Option shall confer upon any  Participant the right to continue as an employee
or  consultant  of the  Company or any  Subsidiary  or affect the right of the
Company or any Subsidiary to terminate the  Participant's  employment or other
relationship with the Company or any Subsidiary at any time.

      4.6   Non-alienation of Benefits.  Other than as specifically  permitted
in Section  3.1.11,  no benefit  under the Plan shall be subject in any manner
to anticipation,  alienation, sale, transfer,  assignment, pledge, encumbrance
or  charge;  and any  attempt to do so other  than as  specifically  permitted
thereunder shall be void. No such benefit shall,  prior to receipt,  be in any
manner   liable  for  or  subject  to  the  debts,   contracts,   liabilities,
engagements or torts of the recipient.

      4.7   Restrictions  on  Delivery  and  Sale  of  Shares;  Legends.  Each
Option is subject to the condition that if at any time the  Committee,  in its
discretion,  shall determine that the listing,  registration or  qualification
of the shares  covered by such  Option upon any  securities  exchange or under
any state or federal law is  necessary  or  desirable  as a condition of or in
connection with the granting of such Option,  the assignment of such Option or
the  purchase  or delivery of shares  thereunder,  the  delivery of any or all
shares  pursuant to such Option may be withheld unless and until such listing,
registration  or  qualification  shall have been  affected.  If a registration
statement is not in effect under the Securities  Act, or any applicable  state
securities  laws with respect to the shares of Stock  purchasable or otherwise
deliverable  under Options then outstanding,  the Committee may require,  as a
condition  of  assignment  or exercise of the Option or as a condition  to any
other delivery of Stock pursuant to an Option,  that the  Participant or other
recipient  of an  Option  represent,  in  writing,  that the  shares  received
pursuant to the Option are being  acquired for  investment and not with a view
to  distribution  and agree that the  shares  will not be  disposed  of except
pursuant to an  effective  registration  statement,  unless the Company  shall
have received an opinion of counsel that such  disposition is exempt from such
requirement  under the  Securities  Act and any  applicable  state  securities
laws. The Company may include on certificates  representing  shares  delivered
pursuant to an Option such legends referring to the foregoing  representations
or  restrictions  or  any  other  applicable  restrictions  on  resale  as the
Company, in its discretion, shall deem appropriate.

      4.8   Termination  and Amendment of the Plan.  The Board at any time may
amend or terminate the Plan without stockholder approval;  provided,  however,
that the Board may condition any amendment on the approval of  stockholders of
the Company if such  approval is necessary  or advisable  with respect to tax,
securities  or  other  applicable  laws.  No  such  termination  or  amendment
without  the  consent of the  Participant  holding an Option  shall  adversely
affect the rights of such Participant with respect to such Option.

      4.9   Choice of Law.  The laws of the  State of  Delaware  shall  govern
the Plan, to the extent not preempted by federal law.

      4.10  Effective  Date of  Plan.  The  Plan  became  effective  on May 8,
1998,  the  date  of its  approval  by the  Board,  subject,  however,  to the
subsequent  approval of the Plan by the Company's  stockholders  within twelve
months after the Board's approval of the Plan.
[{"type": "S-8", "sequence": "1", "description": "FORM S-8", "secsgml_size_bytes": 121357}]
{"company-data": {"conformed-name": "DATASTREAM SYSTEMS INC", "cik": "0000938481", "assigned-sic": "7372", "irs-number": "570813674", "state-of-incorporation": "DE", "fiscal-year-end": "1231"}, "filing-values": {"form-type": "S-8", "act": "33", "file-number": "333-57055", "film-number": "98649827"}, "business-address": {"street1": "50 DATASTREAM PLAZA", "city": "GREENVILLE", "state": "SC", "zip": "29605", "phone": "8644225001"}, "mail-address": {"street1": "50 DATASTREAM PLAZA", "city": "GREENVILLE", "state": "SC", "zip": "29605"}}
As filed with the Securities and Exchange      Registration No. 333-________
Commission on June 17, 1998

===============================================================================
                      SECURITIES AND EXCHANGE COMMISSION
                            WASHINGTON, D.C. 20549
                              __________________

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

                             ___________________

                           DATASTREAM SYSTEMS, INC.
            (Exact name of Registrant as Specified in its Charter)

         Delaware                                            57-0813674
     (State or other                                      (I.R.S. Employer
     jurisdiction of                                     Identification No.)
     incorporation or
      organization)

                              50 Datastream Plaza
                               Greenville, South
                                 Carolina 29605
                             (Address of Principal
                               Executive Offices)

                             ___________________

                           DATASTREAM SYSTEMS, INC.
                       1997 EUROPEAN STOCK OPTION PLAN
                  (DUTCH, U.K. AND FRENCH SUB-PLAN VERSIONS)

                                     AND

                           DATASTREAM SYSTEMS, INC.
                            1998 STOCK OPTION PLAN
                          (Full Title of the Plans)
                             ___________________

                              Larry G. Blackwell
         Chairman of the Board, President and Chief Executive Officer
                           Datastream Systems, Inc.
                             50 Datastream Plaza
                       Greenville, South Carolina 29605
                                (864) 422-5001
          (Name, address, including zip code, and telephone number,
                  including area code, of agent for service)

                               With a copy to:
                             B. Lynn Walsh, Esq.
                              Hunton & Williams
                        NationsBank Plaza - Suite 4100
                         600 Peachtree Street, N. E.
                         Atlanta, Georgia 30308-2216
                                (404) 888-4000

                             ___________________

                       CALCULATION OF REGISTRATION FEE
===============================================================================
                                        Proposed       Proposed
 Title of securities   Amount to be     maximum        maximum      Amount of
   to be registered    registered(1) offering price   aggregate    registration
                                      per share(2)     offering        fee
                                                       price(2)
===============================================================================
Common Stock, $.01       1,110,000       $21.82      $24,220,200    $7,144.96
par value...........      shares
===============================================================================

(1)   Pursuant to Rule 416(a) the number of shares of Common Stock  registered
hereunder  includes such  indeterminate  number of additional shares of Common
Stock as may be offered or issued in the future to prevent dilution  resulting
from stock splits, stock dividends or similar transactions.

(2)   Estimated  solely for the purpose of  computing  the  registration  fee.
This amount was calculated  pursuant to Rule 457(c) on the basis of $21.82 per
share,  which was the  average of the high and low prices of the  Registrant's
Common Stock on June 15, 1998, as reported on the Nasdaq National Market.
==============================================================================
                                    PART I

             INFORMATION REQUIRED IN THE SECTION 10(a) PROSPECTUS
==============================================================================

Item 1.     Plan Information.

      Not required to be filed with the  Securities  and  Exchange  Commission
(the "Commission").

Item 2.     Registrant Information and Employee Plan Annual Information.

      Not required to be filed with the Commission.

                                   PART II

              INFORMATION REQUIRED IN THE REGISTRATION STATEMENT

Item 3.     Incorporation of Documents by Reference.

      The  following  documents  filed  by  Datastream   Systems,   Inc.  (the
"Company") with the Commission are  incorporated  herein by reference and made
a part hereof:

            (i)   The Company's  Annual Report on Form 10-K for the year ended
                  December 31,  1997 (File No.  000-25590),  as filed with the
                  Commission March 31, 1998;

            (ii)  The  Company's   Current   Report  on  Form  8-K  (File  No.
                  000-25590), as filed with the Commission on April 14, 1998;

            (iii) The  Company's  Amendment  No.  1 to Form  10-K for the year
                  ended December 31,  1997 (File No. 000-25590), as filed with
                  the Commission April 16, 1998;

            (iv)  The Company's  Quarterly Report on Form 10-Q for the quarter
                  ended  March 31,  1998 (File No.  000-25590),  as filed with
                  the Commission May 13, 1998; and

            (v)   The  description  of  the  Common  Stock  contained  in  the
                  Company's  Registration  Statement on Form 8-A (Registration
                  No.  000-25590),  including any  amendments or reports filed
                  for the purpose of updating such description,  as filed with
                  the Commission February 17, 1995.

      All  documents  subsequently  filed by the Company  pursuant to Sections
13(a),  13(c), 14 and 15(d) of the Securities Exchange Act of 1934, as amended
(the "Exchange Act"), prior to the filing of a post-effective  amendment which
indicates that all securities  offered have been sold or which deregisters all
securities  then  remaining  unsold,  shall be  deemed to be  incorporated  by
reference in the  Registration  Statement  and to be part hereof from the date
of  filing  of  such  documents.   Any  statement   contained  in  a  document
incorporated by reference  herein 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  document  that  is
incorporated   by  reference   herein  modifies  or  supersedes  such  earlier
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 applicable.

Item 5.     Interests of Named Experts and Counsel.

      Not applicable.

Item 6.     Indemnification of Directors and Officers.

      Section 145 of the General  Corporation Law of Delaware  provides that a
corporation  may  indemnify  its  directors  and  officers  against  civil and
criminal  liabilities.  Directors  and  officers  may be  indemnified  against
expenses  if they acted in good faith and in a manner  reasonably  believed to
be in or not  opposed  to the best  interests  of the  corporation  and,  with
respect to any criminal  action,  if they had no  reasonable  cause to believe
their conduct was unlawful.  A director or officer may be indemnified  against
expenses  incurred in  connection  with a derivative  suit if he acted in good
faith and in a manner reasonably  believed to be in or not opposed to the best
interests  of the  corporation,  except  that no  indemnification  may be made
without court  approval if such person was adjudged  liable for  negligence or
misconduct  in the  performance  of his or her  duty to the  corporation.  The
statutory  indemnification  is not  exclusive  of any rights  provided  by any
by-law,   agreement,  vote  of  shareholders  or  disinterested  directors  or
otherwise.

      Article  VII  of the  Company's  Amended  and  Restated  Certificate  of
Incorporation  sets  forth the  extent to which the  Company's  directors  and
officers may be indemnified  against  liabilities and other monetary  expenses
which they may incur while serving in such  capacities.  Such  indemnification
will be provided to the full extent  permitted  and in the manner  required by
the  General  Corporation  Law of  Delaware.  Article  XII  of  the  Company's
By-laws also  provides  that the directors and officers of the Company will be
indemnified  against any losses  incurred in connection  with any  threatened,
pending or completed  action,  suit or proceeding,  whether  civil,  criminal,
administrative  or  investigative,  by  reason of the fact that he is or was a
director  or  officer  of the  Company  or served  with  another  corporation,
partnership,  joint venture,  trust or other  enterprise at the request of the
Company and will  provide  advances,  for expenses  incurred in defending  any
such  action,  suit or  proceeding,  upon receipt of an  undertaking  by or on
behalf  of  such  officer  or  director  to  repay  such  advances,  if  it is
ultimately  determined  that  he is not  entitled  to  indemnification  by the
Company.

Item 7.     Exemption from Registration Claimed.

      Not applicable.

Item 8.     Exhibits.

Exhibit No.   Description
-----------   -----------
4.1*          Amended and Restated Certificate of Incorporation of
              Datastream Systems, Inc.
4.2**         Amendment to Amended and Restated Certificate of
              Incorporation of Datastream Systems, Inc., dated January
              12, 1998.
4.3***        By-Laws of Datastream Systems, Inc.
4.4+          Specimen Stock Certificate.
5             Opinion of Hunton & Williams.
23.1          Consent of KPMG Peat Marwick LLP, independent certified
              public accountants.
23.2          Consent of Hunton & Williams (included as part of Exhibit
              5).
24            Power of Attorney (included on signature page hereto).
99.1(a)       Datastream Systems, Inc. 1997 European Stock Option Plan
              (Dutch (Sub-Plan) Version)
99.1(b)       Datastream Systems, Inc. 1997 European Stock Option Plan
              (U.K. (Sub-Plan) Version)
99.1(c)       Datastream Systems, Inc. 1997 European Stock Option Plan
              (French (Sub-Plan) Version)
99.2          Datastream Systems, Inc. 1998 Stock Option Plan
_____________________________
*     Incorporated herein by reference to Exhibit 3.1 in the Company's
      Registration Statement on Form S-1 (Registration No. 33-89498).

**    Incorporated herein by reference to Exhibit 3.1(a) in the Company's
      Annual Report on Form 10-K filed March 31, 1998 (File No. 000-25590).

***   Incorporated herein by reference to Exhibit 3.2 in the Company's
      Registration Statement on Form S-1 (Registration No. 33-89498).

+     Incorporated herein by reference to Exhibit 4.2 in the Company's
      Registration Statement on Form S-1 (Registration No. 33-89498).

Item 9.     Undertakings.

      (a)   The Company hereby undertakes:

            1.    To file,  during  any  period  in which  offers or sales are
being made, a post-effective amendment to this Registration Statement:

            (i)   To include any  prospectus  required by Section  10(a)(3) of
                  the Securities Act of 1933 (the "Securities Act");

            (ii)  To reflect  in the  prospectus  any facts or events  arising
                  after the effective date of the  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 the  Registration
                  Statement; and

            (iii) To include  any  material  information  with  respect to the
                  plan  of  distribution  not  previously   disclosed  in  the
                  Registration  Statement  or  any  material  change  to  such
                  information in the Registration Statement.

            2.    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.

            3.    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 Company  hereby  undertakes  that, for purposes of determining
any liability  under the Securities  Act, each filing of the Company's  annual
report  pursuant to  Section 13(a)  or Section 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  the  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 Company pursuant to the foregoing provisions or otherwise,  the
Company  has  been  advised  that  in  the  opinion  of  the  Commission  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
Company of expenses  incurred or paid by a  director,  officer or  controlling
person  of the  Company  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 Company 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 Greenville, South Carolina on this 17th day of June, 1998.

                                       DATASTREAM SYSTEMS, INC.

                                       By: /S/  Larry G. Blackwell  
                                          ------------------------    
                                          Larry G. Blackwell
                                          Chairman of the Board, President
                                       and
                                          Chief Executive Officer

                              POWER OF ATTORNEY

      KNOW  ALL MEN BY  THESE  PRESENTS,  that  each  person  whose  signature
appears  below  hereby  authorizes  each of Larry G.  Blackwell  and Daniel H.
Christie  to  execute  in the  name  of each  such  person,  and to  file  any
amendment,   including  any  post-effective  amendment,  to  the  Registration
Statement making such changes in the Registration  Statement as the Registrant
deems  appropriate,  and appoints  each of Messrs.  Blackwell  and Christie as
attorney-in-fact  to  sign in his  behalf  individually  and in each  capacity
stated below and file all  amendments  and  post-effective  amendments  to the
Registration Statement.

      Pursuant to the  requirements of the Securities  Act, this  Registration
Statement  has  been  signed  by  the  following  persons  in  the  capacities
indicated on the 17th day of June, 1998.

               Signature                               Title

                                         Chairman of the Board, President
/S/  Larry G. Blackwell                   and Chief Executive Officer
------------------------------            (principal executive officer)
Larry G. Blackwell                        
                                         Chief Financial Officer
/S/  Daniel H. Christie                   (principal financial and
------------------------------            accounting officer)
Daniel H. Christie

/S/ Kenneth D. Tracy                      Director
------------------------------
Kenneth D. Tracy

/S/ Richard T. Brock                      Director
------------------------------
Richard T. Brock

/S/ John M. Sterling, Jr.                 Director
------------------------------
John M. Sterling, Jr.

/S/ Ira D. Cohen                          Director
------------------------------
Ira D. Cohen
EXHIBIT INDEX

Exhibit No.   Description
4.1*          Amended and Restated Certificate of Incorporation of
              Datastream Systems, Inc.
4.2**         Amendment to Amended and Restated Certificate of
              Incorporation of Datastream Systems, Inc., dated January
              12, 1998.
4.3***        By-Laws of Datastream Systems, Inc.
4.4+          Specimen Stock Certificate.
5             Opinion of Hunton & Williams.
23.1          Consent of KPMG Peat Marwick LLP, independent certified
              public accountants.
23.2          Consent of Hunton & Williams (included as part of Exhibit
              5).
24            Power of Attorney (included on signature page hereto).
99.1(a)       Datastream Systems, Inc. 1997 European Stock Option Plan
              (Dutch (Sub-Plan) Version)
99.1(b)       Datastream Systems, Inc. 1997 European Stock Option Plan
              (U.K. (Sub-Plan) Version)
99.1(c)       Datastream Systems, Inc. 1997 European Stock Option Plan
              (French (Sub-Plan) Version)
99.2          Datastream Systems, Inc. 1998 Stock Option Plan

______________________________
*     Incorporated herein by reference to Exhibit 3.1 in the Company's
      Registration Statement on Form S-1 (Registration No. 33-89498).

**    Incorporated herein by reference to Exhibit 3.1(a) in the Company's
      Annual Report on Form 10-K filed March 31, 1998 (File No. 000-25590).

***   Incorporated herein by reference to Exhibit 3.2 in the Company's
      Registration Statement on Form S-1 (Registration No. 33-89498).

+     Incorporated herein by reference to Exhibit 4.2 in the Company's
      Registration Statement on Form S-1 (Registration No. 33-89498).
EXHIBIT 5

                (Hunton and Williams Letterhead appears here)

                                June 17, 1998

Datastream Systems, Inc.
50 Datastream Plaza
Greenville, South Carolina 29605

      Re:   Datastream Systems, Inc. 1997 European Stock Option Plan
         and Datastream Systems, Inc. 1998 Stock Option Plan

Ladies and Gentlemen:

      We have  served as counsel  for  Datastream  Systems,  Inc.,  a Delaware
corporation  (the  "Company"),  in connection with the  registration on a Form
S-8  Registration   Statement  (the   "Registration   Statement")   under  the
Securities  Act of 1933, as amended,  of an aggregate of 610,000 shares of the
Company's  authorized  common  stock,  $.01 par value per share  (the  "Common
Stock"),  under the Datastream  Systems,  Inc. 1997 European Stock Option Plan
(the "1997  Plan") and an  aggregate  of 500,000  shares of Common Stock under
the Datastream Systems, Inc. 1998 Stock Option Plan (the "1998 Plan").

      We have  examined and are familiar with  originals or copies  (certified
or otherwise  identified to our  satisfaction)  of such  documents,  corporate
records and other instruments  relating to the organization of the Company and
to the  authorization  and issuance of the shares of Common  Stock  subject to
the 1997 Plan and the 1998 Plan, as appropriate,  as we have deemed  necessary
and advisable.

      Based upon the foregoing and having regard for such legal  consideration
as we deem  relevant,  it is our opinion that the shares of Common Stock under
the 1997 Plan and the 1998 Plan will be,  when issued in  accordance  with the
terms of each such plan, legally issued, fully paid and non-assessable.

      We do hereby  consent to the filing of this  Opinion as Exhibit 5 to the
      Registration Statement.

                                          Very truly yours.

                                          /s/ Hunton & Williams

                                          Hunton & Williams

08058
07688
08086
EXHIBIT 23.1

                        Independent Auditors' Consent
                        -----------------------------

The Board of Directors
Datastream Systems, Inc.:

We consent to  incorporation  by reference in this  Registration  Statement on
Form S-8 of  Datastream  Systems,  Inc. of our report dated  January 23, 1998,
relating to the consolidated  balance sheets of Datastream  Systems,  Inc. and
Subsidiaries  as of December 31, 1997 and 1996,  and the related  consolidated
statements of  operations,  stockholders'  equity,  and cash flows for each of
the years in the  three-year  period  ended  December  31,  1997,  and related
schedule,  which reports appear in the December 31, 1997 annual report on Form
10-K of Datastream Systems, Inc.

Greenville, South Carolina                            /s/ KPMG Peat Marwick
LLP
June 17, 1998
EXHIBIT 99.1(a)

                             TERMS AND CONDITIONS
                         OF DATASTREAM SYSTEMS, INC.
                       1997 EUROPEAN STOCK OPTION PLAN
                           DUTCH (SUB-PLAN) VERSION

      1.          Definitions

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

            (b)         "Disability"  means a disability  of an Optionee  such
that the  Optionee is entitled to  disability  retirement  benefits  under the
Dutch  "WAO" (Wet op de  Arbeidsongeschiktheid)  or such that the  Optionee is
entitled to recover  benefits  under any long-term  disability  plan or policy
maintained  by the Company or an  Affiliate.  The  determination  of whether a
disability  exists shall be made by the Committee  and shall be  substantiated
by competent medical advice.

            (c)         "Employee"  means any  person who is  employed  by the
Company or an Affiliate as meant in article 7:610 Dutch Civil Code.

            (d)         "Fair  Market  Value"  with regard to a date means the
closing  price at which  Common Stock shall have been sold on the last trading
date prior to that date as reported by the Nasdaq  National Market System (or,
if applicable,  as reported by a national  securities exchange selected by the
Committee  (as  defined in the Plan) on which the  shares of Common  Stock are
then  actively  traded) and  published  in The Wall Street  Journal;  provided
that,  for purposes of granting  Options other than  incentive  stock options,
Fair  Market  Value of the  shares of Common  Stock may be  determined  by the
Committee by reference to the average  market value  determined  over a period
certain or as of  specified  dates,  to a tender offer price for the shares of
Common Stock (if  settlement  of an award is triggered by such an event) or to
any other  reasonable  measure  of fair  market  value.  If at the time of the
determination  of Fair Market  Value  shares of Common  Stock are not actively
traded on any market described above,  Fair Market Value means the fair market
value of a share of Common Stock as determined  by the  Committee  taking into
account such facts and  circumstances  deemed to be material by the  Committee
to the  value of the  Common  Stock in the  hands of the  Optionee;  provided,
however,  for  purposes  of  determining  the  Option  price  per share for an
incentive  stock  option,  Fair  Market  Value  shall  be  determined  by  the
Committee  without regard to any restriction  other than a restriction  which,
by its  terms,  will never  lapse.  Fair  Market  Value as  determined  by the
Committee shall be final, binding and conclusive upon each Optionee.

            (e)         "Termination  for Cause"  means a  termination  of the
employment  relationship  between the Optionee and the Company or an Affiliate
due to any of  the  following  reasons:  (1)  willful  and  continued  failure
(other than any such failure  resulting from his incapacity during physical or
mental  illness)  to  substantially  perform his duties with the Company or an
Affiliate  continuing  30 days after  notice by the Company to the Optionee of
such   failure;   (2)  any  act  of   fraud,   misappropriation,   dishonesty,
embezzlement  or similar  conduct  against  the  Company or an  Affiliate,  as
finally  determined  through  arbitration  or  final  judgment  of a court  of
competent  jurisdiction (which arbitration or judgment,  due to the passage of
time or otherwise,  is not subject to further  appeal);  or (3)  conviction of
the Optionee for a felony or any other crime involving moral turpitude  (which
conviction,  due to the  passage  of  time or  otherwise,  is not  subject  to
further  appeal);  or (4)  termination  by  the  employer  of  the  employment
agreement  as meant in article  7:678  Dutch  Civil Code  (ontslag  op staande
voet).

      2.          Term And Exercise Of Option
                  ---------------------------

            (a)         Except  as  otherwise   provided  in  this  Agreement,
Optionee  shall have the right to exercise the Option from time to time during
the  Exercise  Period  with  respect to all or any part of the  vested  Option
Shares.

            (b)         (1)   As  a  condition  to  exercising   this  Option,
Optionee  must deliver to the President of the Company on any business day (A)
written  notice,  signed by the person  exercising the Option,  specifying the
number  of  Option  Shares  being  exercised  and,  if  required,  making  the
representations  and covenants in  substantially  the same form as provided in
the Notice of Exercise,  attached as Exhibit A hereto;  (B) payment in cash or
in shares of Common  Stock  that have been held by the  Optionee  for at least
six months of the Purchase  Price  (defined in Section 3); (C) payment in cash
of the  tax  withholding  liability  arising  from  the  exercise;  and (D) an
executed   shareholders'   agreement,    containing   terms   and   conditions
substantially   similar  to  any  shareholders'   agreement  executed  by  and
applicable to the holders of a majority of the shares of Common  Stock,  if so
required by the Committee.

                  (1)         In lieu of  payment  of all tax  withholding  by
Optionee as provided  above,  Optionee  may elect to have the number of Option
Shares he is to receive  upon  exercise of an Option  reduced by the  smallest
number of whole Option Shares which,  when multiplied by the fair market value
of the Shares  determined as of the Tax Date (defined below), is sufficient to
satisfy required federal,  state, and local, if any, withholding taxes arising
from:

                        (A)         the  Withholding  Election  must  be  made
prior to  the date on  which the  amount of tax  required  to be  withheld  is
determined  (the "Tax Date") by  executing  and  delivering  to  the Company a
properly  completed  Notice  of Withholding  Election,  attached  as Exhibit B
hereto;

                        (B)         any  Withholding  Election  made  will  be
irrevocable;  however, the Committee may at its sole discretion disapprove and
give no effect to any Withholding Election; and

                        (C)         if  the   Optionee  is  required  to  file
beneficial  ownership  reports pursuant to Subsection (a) of Section 16 of the
Securities  Exchange Act of 1934 (the "Act"), at any time during the period in
which the Option is exercisable, then:

                           (i)            no Option  to which any  Withholding
Election  relates  may be  exercised  until the earlier of either (I) one year
after the Company has been subject to the  reporting  requirements  of Section
15 of the Act and has filed all  reports and  statements  required to be filed
pursuant to that Section  during that year,  or (II) at least six months after
the date of grant  (except in the event of death or Disability of the Optionee
prior to the expiration of the six-month period; and

                          (ii)            the  Withholding   Section  must  be
made  either  (A) at least six months  prior to the Tax Date,  or (B) prior to
the Tax  Date  and in any ten  business  day  period  beginning  on the  third
business  day  following  the  release of the  Company's  quarterly  or annual
summary statement of sales and earnings.

      Upon  receipt of such notice and payment in full of the  Purchase  Price
and tax  withholding  liability,  the  Company  shall  cause  to be  issued  a
certificate representing the shares of Common Stock purchased.

            (c)         Except as otherwise  provided in this  Agreement,  the
Option  shall  terminate  on the  earliest of (1) the last day of the Exercise
Period;  (2) the date the Committee  exercises its right pursuant to Section 8
to terminate the Option;  (3) thirty (30) days after Optionee  ceases to be an
Employee,  except if such  termination is due to Termination for Cause,  death
or Disability,  (4) one-hundred  eighty (180) days after Optionee ceases to be
an  Employee  if such  termination  is due to death or  Disability;  or (5) if
Optionee ceases to be an Employee as a result of a Termination for Cause,  the
time of such termination.

            (d)         The price paid by the Company  shall be payable at the
Company's  option (1) by delivery to the  Optionee of the entire  price in the
form of cash or check;  or (2) by payment of four  substantially  equal annual
installments,  the first  installment  being due at the date of termination of
the  Option and the  second,  third and  fourth  installment  being due on the
first,  second  and  third  anniversaries  of the date of  termination  of the
Option, respectively.

      3.          Purchase  Price.  Optionee  must  pay  to  the  Company  the
Exercise  Price  (subject to  adjustment  pursuant to Section 8) multiplied by
the number of the Option  Shares being  acquired  through the exercise of this
Option  (the  "Purchase  Price").  Shares  of  Common  Stock  tendered  by the
Optionee  in  satisfaction  of the  Purchase  Price shall be credited at their
Fair Market Value.

      4.          Non-Transferability  of Option.  Except for any  transfer of
the Option by bequest or  inheritance,  the Optionee  shall not have the right
to make or permit to exist any transfer or hypothecation,  whether outright or
as security, with or without consideration,  voluntary or involuntary,  of all
or any  part  of  any  right,  title  or  interest  in the  Option.  Any  such
disposition  not made in accordance  with this Agreement  shall be deemed null
and void.  The Option  shall be  exercisable  during the  lifetime of Optionee
only by  Optionee,  and  after  his  death  by a  legatee  or  legatees  under
Optionee's  last  will and  testament  or by his  personal  representative  or
representatives,  who shall be bound by the same  terms of this  Agreement  as
apply to the Optionee.

      5.          Restrictions  on  Transfer  of  Option  Shares.   Except  as
provided  in this  Agreement  or for any  transfer  of Option  Shares by gift,
bequest,  or  inheritance  to the  Optionee's  or a  subsequent  shareholder's
family  member,  estate,  heirs,  or  legatees or for any  transfer  after the
closing of an initial public offering of Common Stock,  the Optionee shall not
have the  right to make or  permit to exist  any  transfer  or  hypothecation,
whether outright or as security,  with or without consideration,  voluntary or
involuntary,  of all or any part of any right,  title or  interest  (including
but not  limited  to,  voting  rights)  in or to any Option  Shares.  Any such
disposition  not made in accordance  with this Agreement  shall be deemed null
and void.  Any permitted  transferee  under this Section shall be bound by the
same terms of this Agreement as apply to the Optionee.

      6.          No  Rights  as  Shareholder.   Optionee,  or  his  permitted
transferee  under  Section 4,  shall  have no  rights  as a  stockholder  with
respect to any Option Shares until the issuance of a stock  certificate to him
for such  shares.  No  adjustment  shall be made for  dividends  (ordinary  or
extraordinary,   whether   in  cash,   securities   or  other   property)   or
distributions  or other rights on or with respect to Option  Shares  purchased
pursuant  to this  Option  for which the  record  date is prior to the date of
exercise hereof, except as provided in Section 8 below.

      7.          Repurchase Rights.
                  -----------------

            (a)         (1)   At all times  prior to the closing of an initial
public  offering of Common Stock,  or (2) within ninety (90) days  following a
Termination  for Cause,  the Company shall have the right to  repurchase  from
the Optionee all Option Shares.  For this purpose,  a notice of exercise given
by the Company to the  Optionee  pursuant to this Section 7 shall be effective
to  perfect  the  Company's  right of  repurchase,  subject  to the  remaining
provisions of this Section 7.

            (b)         (1)   The  Company  upon   exercising  this  right  of
repurchase  shall give written  notice to the Optionee of the number of shares
of Option Shares to be repurchased,  of the repurchase  price,  which shall be
determined  pursuant to Section 7(c)  hereof,  and of the time and date of the
closing of the repurchase of the Option  Shares,  which shall be no later than
sixty  (60)  days  from  the  date  of the  notice  and  shall  be held at the
principal  office of the Company.  At closing,  the Company  shall deliver the
application  portion of the  repurchase  price and the Optionee  shall deliver
the Option  Shares to be  repurchased  duly endorsed for transfer and with all
required revenue stamps attached,  and the title to the Option Shares shall be
transferred  to  the  Company  free  and  clear  of  all  liens,  claims,  and
encumbrances,   however   described,   except  for  restrictions   imposed  by
applicable securities laws.

                  (1)         If the Company  decides to repurchase  less than
all of the Option Shares owned by the Optionee,  the Company shall employ such
method  as it shall  deem  appropriate  in  determining  the  number of Option
Shares to be repurchased.

                  (2)         The price for Option Shares  repurchased  by the
Company  shall be payable by  delivery  to the  Optionee at the closing of the
entire repurchase price in the form of cash or check;  provided,  however, the
Company  may pay the  entire  repurchase  price  in four  substantially  equal
annual  installments  consisting of principal and interest at the "Prime Rate"
reported in the Wall Street  Journal on the first  business day  preceding the
date of  repurchase,  the first  installment  being due at the closing and the
second,  third, and fourth  installment  being due on the first,  second,  and
third anniversaries of the closing, respectively.

                  (3)         If the Optionee  fails to consummate the sale or
deliver the Option Shares certificates  properly assigned when requested to do
so, the Company, or its designee,  shall cancel the Option Shares certificates
of the Optionee  and deposit the payment  pursuant to Section  7(b)(3)  hereof
which was to be made to the Optionee in exchange for the  certificates  to the
credit or account of the Optionee with escrow with any  clearinghouse  bank in
the  City of  Greenville,  South  Carolina,  at the  expense  and  risk of the
Optionee, or his successors or assigns,  whereupon the Company shall treat the
Option Shares  represented  thereby as having been  repurchased by the Company
or its designees.

            (c)         The  repurchase  price for each Option  Share shall be
an amount  equal to the Fair  Market  Value,  except if the Option  Shares are
repurchased  by the Company  pursuant to written  notice given  within  ninety
(90) days  following a  Termination  for Cause,  in which case the  repurchase
price for each Option  Share  shall be the lower of Fair  Market  Value or the
Exercise Price paid by the Optionee.

      8.          Change  in  Capitalization.   The  total  number  of  Option
Shares to be received  upon  exercise of the Option  (both as to the number of
Option Shares and the Purchase Price) shall be appropriately  adjusted for any
change  in  par  value,   split-up,   stock   split,   reverse   stock  split,
reclassification,  merger,  consolidation,  distribution of stock dividends or
similar  capital  adjustments,  to the end that the  Optionee's  proportionate
interest in value shall be maintained  as before the  occurrence of the event.
The adjustment  shall be made without change in the total price  applicable to
the unexercised  portion of the Option and with a corresponding  adjustment in
the Exercise Price.

      The  foregoing   adjustments  and  the  manner  of  application  of  the
foregoing  provisions  shall  be  determined  by the  Committee  in  its  sole
discretion.  Any adjustment may provide for the  elimination of any fractional
Option Shares.

      Notwithstanding  any other  provision of this  Agreement,  the Committee
reserves the right in the event of a sale of  substantially  all of the Common
Stock or  property  of the  Company  or the  merger  or  consolidation  of the
Company,  or a  dissolution  or  liquidation  of the Company to terminate  the
Option in  consideration  of the  payment to the  Optionee  of the  difference
between (1) and (2) where (1) equals the Fair Market Value of the  unexercised
Option  Shares to the extent  vested and (2) equals the Purchase  Price of the
unexercised Option Shares to the extent vested.

      9.          Governing   Laws.   This   Agreement   shall  be  construed,
administered  and  enforced  according  to the laws of the State of  Delaware;
provided,  however,  the Option may not be exercised except, in the reasonable
judgment  of the Board of  Directors,  in  compliance  with  exemptions  under
applicable  state  securities  laws of the  state in which  Optionee  resides,
and/or any other  applicable  securities  laws. In addition,  the  Participant
hereby  acknowledges  that this Option may have been granted prior to the time
the  interest   represented  hereby  was  registered  under  applicable  South
Carolina  securities laws and that, as a result,  the Participant may have the
right  to  rescind  the  grant  of  the  Option.  This  Agreement,  therefore,
constitutes  an offer to so  rescind  the prior  grant  for the  consideration
payable to the Optionee  specified by Section  35-1-1530 of the South Carolina
Uniform  Securities Act.  Because,  however,  the Participant has not paid any
consideration  for the grant,  the Participant  desires to decline such offer,
and does hereby waive such right of rescission  with respect to this Option as
of the date  hereof.  The Company  agrees to use its best  efforts to register
the  Option  (as  well  as the  Stock  into  which  it is  convertible)  under
applicable  federal and state  securities laws as soon as practicable,  and in
any  event  prior to the date on which  any  portion  of the  Option is vested
hereunder.

      10.         Successors.  This  Agreement  shall  inure to the benefit of
the heirs,  legal  representatives,  successors  and permitted  assigns of the
Company and Optionee.

      11.         Notice.   Any  notice  which  either  party  hereto  may  be
required or  permitted  to give to the other  shall be in writing,  and may be
delivered  personally or by mail,  postage prepaid,  addressed as follows:  to
the President of the Company,  or to the Company (attention of the President),
at 50 Datastream  Plaza,  Greenville,  South Carolina  29605,  or at any other
address as the Company,  by notice to Optionee,  may designate in writing from
time to time; to Optionee,  at  Optionee's  address as shown on the records of
the Company,  or at any other  address as Optionee,  by notice to the Company,
may designate in writing from time to time.

      12.         Severability.  In the  event  that  any  one or  more of the
provisions  or  portion  thereof  contained  in this  Agreement  shall for any
reason be held to be invalid,  illegal or  unenforceable  in any respect,  the
same shall not  invalidate  or otherwise  affect any other  provisions of this
Agreement,  and this Agreement  shall be construed as if the invalid,  illegal
or unenforceable provision or portion thereof had never been contained herein.

      13.         Entire  Agreement.  Subject to the terms and  conditions  of
the Datastream  Systems,  Inc. 1995 Stock Option Plan,  which is  incorporated
herein by reference,  this Agreement  expresses the entire  understanding  and
agreement of the parties hereto with respect to such terms,  restrictions  and
limitations.

      14.         Headings.  Section  headings used herein are for convenience
of reference only and shall not be considered in construing this Agreement.

      15.         Specific  Performance.   In  the  event  of  any  actual  or
threatened  default  in,  or  breach  of,  any of the  terms,  conditions  and
provisions of this Agreement,  the party or parties who are thereby  aggrieved
shall have the right to specific  performance  and  injunction  in addition to
any and all  other  rights  and  remedies  at law or in  equity,  and all such
rights and remedies shall be cumulative.

      16.         Resolution    of    Disputes.     Any    determination    or
interpretation by the Committee shall be final,  binding and conclusive on all
persons affected thereby.

      17.         Compliance with Securities  Laws.  Notwithstanding  anything
contained  herein to the contrary,  no purported  exercise of the Option shall
be  effective  without  the  written  approval  of the  Company,  which may be
withheld  to the  extent  that its  exercise,  either  individually  or in the
aggregate  together  with the  exercise of other  previously  exercised  stock
options  and/or  offers  and  sales  pursuant  to any  prior  or  contemplated
offering  of  securities,  would,  in the sole and  absolute  judgment  of the
Company,  require  the  filing of a  registration  statement  with the  United
States Securities and Exchange Commission,  or with the securities  commission
of  any  state.  The  Company  shall  avail  itself  of  any  exemptions  from
registration  contained in applicable federal and state securities laws which,
in its sole  and  absolute  discretion,  it deems  reasonable  and not  unduly
burdensome  or costly.  The Optionee  shall  deliver to the Company,  prior to
the exercise of the Option,  such information,  representations and warranties
as the  Company  may  request  in order for the  Company to be able to satisfy
itself that the Common  Stock to be acquired  pursuant to the  exercise of the
Option  is  being  acquired  in  accordance  with the  terms of an  applicable
exemption from the securities registration  requirements of applicable federal
and state securities laws.

                                   * * * * *
EXHIBIT 99.1(b)

                             TERMS AND CONDITIONS
                         OF DATASTREAM SYSTEMS, INC.
                       1997 EUROPEAN STOCK OPTION PLAN
                      UNITED KINGDOM (SUB-PLAN) VERSION

      1.          Definitions
                  -----------

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

            (b)         "Disability"  means a disability  of an Optionee  such
that the  Optionee is entitled to  disability  retirement  benefits  under the
federal  Social  Security Act or such that the Optionee is entitled to recover
benefits  under any  long-term  disability  plan or policy  maintained  by the
Company or an  Affiliate.  The  determination  of whether a disability  exists
shall  be made by the  Committee  and  shall  be  substantiated  by  competent
medical advice.

            (c)         "Employee"  means any  person who is  employed  by the
Company or an Affiliate  for purposes of the Federal  Insurance  Contributions
Act.

            (d)         "Fair  Market  Value"  with regard to a date means the
closing  price at which  Common Stock shall have been sold on the last trading
date prior to that date as reported by the Nasdaq  National Market System (or,
if applicable,  as reported by a national  securities exchange selected by the
Committee  (as  defined in the Plan) on which the  shares of Common  Stock are
then  actively  traded) and  published  in The Wall Street  Journal;  provided
that,  for purposes of granting  Options other than  incentive  stock options,
Fair  Market  Value of the  shares of Common  Stock may be  determined  by the
Committee by reference to the average  market value  determined  over a period
certain or as of  specified  dates,  to a tender offer price for the shares of
Common Stock (if  settlement  of an award is triggered by such an event) or to
any other  reasonable  measure  of fair  market  value.  If at the time of the
determination  of Fair Market  Value  shares of Common  Stock are not actively
traded on any market described above,  Fair Market Value means the fair market
value of a share of Common Stock as determined  by the  Committee  taking into
account such facts and  circumstances  deemed to be material by the  Committee
to the  value of the  Common  Stock in the  hands of the  Optionee;  provided,
however,  for  purposes  of  determining  the  Option  price  per share for an
incentive  stock  option,  Fair  Market  Value  shall  be  determined  by  the
Committee  without regard to any restriction  other than a restriction  which,
by its  terms,  will never  lapse.  Fair  Market  Value as  determined  by the
Committee shall be final, binding and conclusive upon each Optionee.

            (e)         "Termination  for Cause"  means a  termination  of the
employment  relationship  between the Optionee and the Company or an Affiliate
due to any of  the  following  reasons:  (1)  willful  and  continued  failure
(other than any such failure  resulting from his incapacity during physical or
mental  illness)  to  substantially  perform his duties with the Company or an
Affiliate  continuing  30 days after  notice by the Company to the Optionee of
such   failure;   (2)  any  act  of   fraud,   misappropriation,   dishonesty,
embezzlement  or similar  conduct  against  the  Company or an  Affiliate,  as
finally  determined  through  arbitration  or  final  judgment  of a court  of
competent  jurisdiction (which arbitration or judgment,  due to the passage of
time or otherwise,  is not subject to further  appeal);  or (3)  conviction of
the Optionee for a felony or any other crime involving moral turpitude  (which
conviction,  due to the  passage  of  time or  otherwise,  is not  subject  to
further appeal).

      2.          Term And Exercise Of Option
                  ---------------------------

            (a)         Except  as  otherwise   provided  in  this  Agreement,
Optionee  shall have the right to exercise the Option from time to time during
the  Exercise  Period  with  respect to all or any part of the  vested  Option
Shares.  Election  of payment in shares may incur  extra  P.A.Y.E  withholding
taxes.
            (b)         (1)  As  a  condition  to   exercising   this  Option,
Optionee  must deliver to the President of the Company on any business day (A)
written  notice,  signed by the person  exercising the Option,  specifying the
number  of  Options  shares  being  exercised  and,  if  required  making  the
representations  and covenants in  substantially  the same form as provided in
the  Notice of  Exercise,  attached  as Exhibit A hereto;  (B) (i)  payment in
cash  or  (ii)  in  shares  of  Common  Stock  that  have  been  held  by  the
Optionee  for at least six months of the  Purchase  Price  (defined in Section
3); (C)  payment in cash of the tax  withholding  liability  arising  from the
exercise;  and (D) an executed shareholders'  agreement,  containing terms and
conditions  substantially  similar to any shareholders'  agreement executed by
and  applicable  to the holders of the  majority  of the share  holders of the
shares of Common Stock, if so required by the Committee.

                         (2) Upon receipt of such  notice and  payment in full
of  the  Purchase  Price and  tax  withholding  liability,  the  Company shall
cause to be  issued  a  certificate  representing  the  shares of Common Stock
purchased.

            (c)         Except as otherwise  provided in this  Agreement,  the
Option  shall  terminate  on the  earliest of (1) the last day of the Exercise
Period;  (2) the date the Committee  exercises its right pursuant to Section 8
to terminate the Option;  (3) thirty (30) days after Optionee  ceases to be an
Employee,  except if such  termination is due to Termination for Cause,  death
or Disability,  (4) one-hundred  eighty (180) days after Optionee ceases to be
an  Employee  if such  termination  is due to death or  Disability;  or (5) if
Optionee ceases to be an Employee as a result of a Termination for Cause,  the
time of such termination.

            (d)         The price paid by the Company  shall be payable at the
Company's  option (1) by delivery to the  Optionee of the entire  price in the
form of cash or check;  or (2) by payment of four  substantially  equal annual
installments,  the first  installment  being due at the date of termination of
the  Option and the  second,  third and  fourth  installment  being due on the
first,  second  and  third  anniversaries  of the date of  termination  of the
Option, respectively.

      3.          Purchase  Price.  Optionee  must  pay  to  the  Company  the
Exercise  Price  (subject to  adjustment  pursuant to Section 8) multiplied by
the number of the Option  Shares being  acquired  through the exercise of this
Option  (the  "Purchase  Price").  Shares  of  Common  Stock  tendered  by the
Optionee  in  satisfaction  of the  Purchase  Price shall be credited at their
Fair Market Value.

      4.          Non-Transferability  of Option.  Except for any  transfer of
the Option by bequest or  inheritance,  the Optionee  shall not have the right
to make or permit to exist any transfer or hypothecation,  whether outright or
as security, with or without consideration,  voluntary or involuntary,  of all
or any  part  of  any  right,  title  or  interest  in the  Option.  Any  such
disposition  not made in accordance  with this Agreement  shall be deemed null
and void.  The Option  shall be  exercisable  during the  lifetime of Optionee
only by  Optionee,  and  after  his  death  by a  legatee  or  legatees  under
Optionee's  last  will and  testament  or by his  personal  representative  or
representatives,  who shall be bound by the same  terms of this  Agreement  as
apply to the Optionee.

      5.          Restrictions  on  Transfer  of  Option  Shares.   Except  as
provided  in this  Agreement  or for any  transfer  of Option  Shares by gift,
bequest,  or  inheritance  to the  Optionee's  or a  subsequent  shareholder's
family  member,  estate,  heirs,  or  legatees or for any  transfer  after the
closing of an initial public offering of Common Stock,  the Optionee shall not
have the  right to make or  permit to exist  any  transfer  or  hypothecation,
whether outright or as security,  with or without consideration,  voluntary or
involuntary,  of all or any part of any right,  title or  interest  (including
but not  limited  to,  voting  rights)  in or to any Option  Shares.  Any such
disposition  not made in accordance  with this Agreement  shall be deemed null
and void.  Any permitted  transferee  under this Section shall be bound by the
same terms of this Agreement as apply to the Optionee.

      6.          No  Rights  as  Shareholder.   Optionee,  or  his  permitted
transferee  under  Section 4,  shall  have no  rights  as a  stockholder  with
respect to any Option Shares until the issuance of a stock  certificate to him
for such  shares.  No  adjustment  shall be made for  dividends  (ordinary  or
extraordinary,   whether   in  cash,   securities   or  other   property)   or
distributions  or other rights on or with respect to Option  Shares  purchased
pursuant  to this  Option  for which the  record  date is prior to the date of
exercise hereof, except as provided in Section 8 below.

      7.          Repurchase Rights.

            (a)         (1)   At all times  prior to the closing of an initial
public  offering of Common Stock,  or (2) within ninety (90) days  following a
Termination  for Cause,  the Company shall have the right to  repurchase  from
the Optionee all Option Shares.  For this purpose,  a notice of exercise given
by the Company to the  Optionee  pursuant to this Section 7 shall be effective
to  perfect  the  Company's  right of  repurchase,  subject  to the  remaining
provisions of this Section 7.

            (b)         (1)   The  Company  upon   exercising  this  right  of
repurchase  shall give written  notice to the Optionee of the number of shares
of Option Shares to be repurchased,  of the repurchase  price,  which shall be
determined  pursuant to Section 7(c)  hereof,  and of the time and date of the
closing of the repurchase of the Option  Shares,  which shall be no later than
sixty  (60)  days  from  the  date  of the  notice  and  shall  be held at the
principal  office of the Company.  At closing,  the Company  shall deliver the
application  portion of the  repurchase  price and the Optionee  shall deliver
the Option  Shares to be  repurchased  duly endorsed for transfer and with all
required revenue stamps attached,  and the title to the Option Shares shall be
transferred  to  the  Company  free  and  clear  of  all  liens,  claims,  and
encumbrances,   however   described,   except  for  restrictions   imposed  by
applicable securities laws.

                  (1)         If the Company  decides to repurchase  less than
all of the Option Shares owned by the Optionee,  the Company shall employ such
method  as it shall  deem  appropriate  in  determining  the  number of Option
Shares to be repurchased.

                  (2)         The price for Option Shares  repurchased  by the
Company  shall be payable by  delivery  to the  Optionee at the closing of the
entire repurchase price in the form of cash or check;  provided,  however, the
Company  may pay the  entire  repurchase  price  in four  substantially  equal
annual  installments  consisting of principal and interest at the "Prime Rate"
reported in the Wall Street  Journal on the first  business day  preceding the
date of  repurchase,  the first  installment  being due at the closing and the
second,  third, and fourth  installment  being due on the first,  second,  and
third anniversaries of the closing, respectively.

                  (3)         If the Optionee  fails to consummate the sale or
deliver the Option Shares certificates  properly assigned when requested to do
so, the Company, or its designee,  shall cancel the Option Shares certificates
of the Optionee  and deposit the payment  pursuant to Section  7(b)(3)  hereof
which was to be made to the Optionee in exchange for the  certificates  to the
credit or account of the Optionee with escrow with any  clearinghouse  bank in
the  City of  Greenville,  South  Carolina,  at the  expense  and  risk of the
Optionee, or his successors or assigns,  whereupon the Company shall treat the
Option Shares  represented  thereby as having been  repurchased by the Company
or its designees.

            (c)         The  repurchase  price for each Option  Share shall be
an amount  equal to the Fair  Market  Value,  except if the Option  Shares are
repurchased  by the Company  pursuant to written  notice given  within  ninety
(90) days  following a  Termination  for Cause,  in which case the  repurchase
price for each Option  Share  shall be the lower of Fair  Market  Value or the
Exercise Price paid by the Optionee.

      8.          Change  in  Capitalization.   The  total  number  of  Option
Shares to be received  upon  exercise of the Option  (both as to the number of
Option Shares and the Purchase Price) shall be appropriately  adjusted for any
change  in  par  value,   split-up,   stock   split,   reverse   stock  split,
reclassification,  merger,  consolidation,  distribution of stock dividends or
similar  capital  adjustments,  to the end that the  Optionee's  proportionate
interest in value shall be maintained  as before the  occurrence of the event.
The adjustment  shall be made without change in the total price  applicable to
the unexercised  portion of the Option and with a corresponding  adjustment in
the Exercise Price.

      The  foregoing   adjustments  and  the  manner  of  application  of  the
foregoing  provisions  shall  be  determined  by the  Committee  in  its  sole
discretion.  Any adjustment may provide for the  elimination of any fractional
Option Shares.

      Notwithstanding  any other  provision of this  Agreement,  the Committee
reserves the right in the event of a sale of  substantially  all of the Common
Stock or  property  of the  Company  or the  merger  or  consolidation  of the
Company,  or a  dissolution  or  liquidation  of the Company to terminate  the
Option in  consideration  of the  payment to the  Optionee  of the  difference
between (1) and (2) where (1) equals the Fair Market Value of the  unexercised
Option  Shares to the extent  vested and (2) equals the Purchase  Price of the
unexercised Option Shares to the extent vested.

      9.          Governing   Laws.   This   Agreement   shall  be  construed,
administered  and  enforced  according  to the laws of the State of  Delaware;
provided,  however,  the Option may not be exercised except, in the reasonable
judgment  of the Board of  Directors,  in  compliance  with  exemptions  under
applicable  securities laws of the country in which Optionee  resides,  and/or
any other  applicable  securities  laws. In addition,  the Participant  hereby
acknowledges  that this  Option  may have been  granted  prior to the time the
interest  represented  hereby was registered  under  applicable South Carolina
securities  laws and that, as a result,  the Participant may have the right to
rescind the grant of the Option.  This  Agreement,  therefore,  constitutes an
offer to so  rescind  the prior  grant for the  consideration  payable  to the
Optionee  specified  by  Section  35-1-1530  of  the  South  Carolina  Uniform
Securities  Act.   Because,   however,   the  Participant  has  not  paid  any
consideration  for the grant,  the Participant  desires to decline such offer,
and does hereby waive such right of rescission  with respect to this Option as
of the date  hereof.  The Company  agrees to use its best  efforts to register
the  Option  (as  well  as the  Stock  into  which  it is  convertible)  under
applicable  securities laws as soon as practicable,  and in any event prior to
the date on which any portion of the Option is vested hereunder.

      10.         Successors.  This  Agreement  shall  inure to the benefit of
the heirs,  legal  representatives,  successors  and permitted  assigns of the
Company and Optionee.

      11.         Notice.   Any  notice  which  either  party  hereto  may  be
required or  permitted  to give to the other  shall be in writing,  and may be
delivered  personally or by mail,  postage prepaid,  addressed as follows:  to
the President of the Company,  or to the Company (attention of the President),
at 50 Datastream  Plaza,  Greenville,  South Carolina  29605,  or at any other
address as the Company,  by notice to Optionee,  may designate in writing from
time to time; to Optionee,  at  Optionee's  address as shown on the records of
the Company,  or at any other  address as Optionee,  by notice to the Company,
may designate in writing from time to time.

      12.         Severability.  In the  event  that  any  one or  more of the
provisions  or  portion  thereof  contained  in this  Agreement  shall for any
reason be held to be invalid,  illegal or  unenforceable  in any respect,  the
same shall not  invalidate  or otherwise  affect any other  provisions of this
Agreement,  and this Agreement  shall be construed as if the invalid,  illegal
or unenforceable provision or portion thereof had never been contained herein.

      13.         Entire  Agreement.  Subject to the terms and  conditions  of
the Datastream  Systems,  Inc. 1997 Stock Option Plan,  which is  incorporated
herein by reference,  this Agreement  expresses the entire  understanding  and
agreement of the parties hereto with respect to such terms,  restrictions  and
limitations.

      14.         Headings.  Section  headings used herein are for convenience
of reference only and shall not be considered in construing this Agreement.

      15.         Specific  Performance.   In  the  event  of  any  actual  or
threatened  default  in,  or  breach  of,  any of the  terms,  conditions  and
provisions of this Agreement,  the party or parties who are thereby  aggrieved
shall have the right to specific  performance  and  injunction  in addition to
any and all  other  rights  and  remedies  at law or in  equity,  and all such
rights and remedies shall be cumulative.

      16.         Resolution    of    Disputes.     Any    determination    or
interpretation by the Committee shall be final,  binding and conclusive on all
persons affected thereby.

      17.         Compliance with Securities  Laws.  Notwithstanding  anything
contained  herein to the contrary,  no purported  exercise of the Option shall
be  effective  without  the  written  approval  of the  Company,  which may be
withheld  to the  extent  that its  exercise,  either  individually  or in the
aggregate  together  with the  exercise of other  previously  exercised  stock
options  and/or  offers  and  sales  pursuant  to any  prior  or  contemplated
offering  of  securities,  would,  in the sole and  absolute  judgment  of the
Company,  require  the  filing of a  registration  statement  with the  United
States Securities and Exchange Commission,  or with the securities  commission
of  any  state.  The  Company  shall  avail  itself  of  any  exemptions  from
registration  contained in applicable  TAX and securities  laws which,  in its
sole and absolute  discretion,  it deems reasonable and not unduly  burdensome
or costly.  The Optionee  shall deliver to the Company,  prior to the exercise
of  the  Option,  such  information,  representations  and  warranties  as the
Company  may  request in order for the  Company  to be able to satisfy  itself
that the Common  Stock to be acquired  pursuant to the  exercise of the Option
is being  acquired in  accordance  with the terms of an  applicable  exemption
from the securities registration requirements of applicable securities laws.

                                   * * * * *
EXHIBIT 99.1(c)

                             TERMS AND CONDITIONS
                         OF DATASTREAM SYSTEMS, INC.
                       1997 EUROPEAN STOCK OPTION PLAN
                          FRENCH (SUB-PLAN) VERSION

      1.          Definitions
                  -----------

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

            (b)         "Disability"  means a disability  of an Optionee  such
that the  Optionee is entitled to  disability  retirement  benefits  under the
federal  Social  Security Act or such that the Optionee is entitled to recover
benefits  under any  long-term  disability  plan or policy  maintained  by the
Company or an  Affiliate.  The  determination  of whether a disability  exists
shall  be made by the  Committee  and  shall  be  substantiated  by  competent
medical advice.

            (c)         "Employee"  means any  person who is  employed  by the
Company or an Affiliate  for purposes of the Federal  Insurance  Contributions
Act.

            (d)         "Fair  Market  Value"  with regard to a date means the
closing  price at which  Common Stock shall have been sold on the last trading
date prior to that date as reported by the Nasdaq  National Market System (or,
if applicable,  as reported by a national  securities exchange selected by the
Committee  (as  defined in the Plan) on which the  shares of Common  Stock are
then  actively  traded) and  published  in The Wall Street  Journal;  provided
that,  for purposes of granting  Options other than  incentive  stock options,
Fair  Market  Value of the  shares of Common  Stock may be  determined  by the
Committee by reference to the average  market value  determined  over a period
certain or as of  specified  dates,  to a tender offer price for the shares of
Common Stock (if  settlement  of an award is triggered by such an event) or to
any other  reasonable  measure  of fair  market  value.  If at the time of the
determination  of Fair Market  Value  shares of Common  Stock are not actively
traded on any market described above,  Fair Market Value means the fair market
value of a share of Common Stock as determined  by the  Committee  taking into
account such facts and  circumstances  deemed to be material by the  Committee
to the  value of the  Common  Stock in the  hands of the  Optionee;  provided,
however,  for  purposes  of  determining  the  Option  price  per share for an
incentive  stock  option,  Fair  Market  Value  shall  be  determined  by  the
Committee  without regard to any restriction  other than a restriction  which,
by its  terms,  will never  lapse.  Fair  Market  Value as  determined  by the
Committee shall be final, binding and conclusive upon each Optionee.

            (e)         "Termination  for Cause"  means a  termination  of the
employment  relationship  between the Optionee and the Company or an Affiliate
due to any of  the  following  reasons:  (1)  willful  and  continued  failure
(other than any such failure  resulting from his incapacity during physical or
mental  illness)  to  substantially  perform his duties with the Company or an
Affiliate  continuing  30 days after  notice by the Company to the Optionee of
such   failure;   (2)  any  act  of   fraud,   misappropriation,   dishonesty,
embezzlement  or similar  conduct  against  the  Company or an  Affiliate,  as
finally  determined  through  arbitration  or  final  judgment  of a court  of
competent  jurisdiction (which arbitration or judgment,  due to the passage of
time or otherwise,  is not subject to further  appeal);  or (3)  conviction of
the Optionee for a felony or any other crime involving moral turpitude  (which
conviction,  due to the  passage  of  time or  otherwise,  is not  subject  to
further appeal).

      2.          Term and Exercise of Option

            (a)         Except  as  otherwise   provided  in  this  Agreement,
Optionee  shall have the right to exercise the Option from time to time during
the  Exercise  Period  with  respect to all or any part of the  vested  Option
Shares.  Election  of  payment in shares may incur  extra  French  withholding
taxes.

                        The sale of shares acquired  according to the plan may
occur any time  after  the  required  vesting  periods  have  been  satisfied,
however  sale of the shares  acquired  under the plan may lose  favorable  tax
treatment  if they are sold before being held for five years from the date the
option is granted.

            (b)         (1)  As  a  condition  to   exercising   this  Option,
Optionee  must deliver to the President of the Company on any business day (A)
written  notice,  signed by the person  exercising the Option,  specifying the
number  of  Options  shares  being  exercised  and,  if  required  making  the
representations  and covenants in  substantially  the same form as provided in
the  Notice of  Exercise,  attached  as Exhibit A hereto;  (B) (i)  payment in
cash  or  (ii)  in  shares  of  Common  Stock  that  have  been  held  by  the
Optionee  for at least six months of the  Purchase  Price  (defined in Section
3); (C)  payment in cash of the tax  withholding  liability  arising  from the
exercise;  and (D) an executed shareholders'  agreement,  containing terms and
conditions  substantially  similar to any shareholders'  agreement executed by
and  applicable  to the holders of the  majority  of the share  holders of the
shares of Common Stock, if so required by the Committee.

                        (2)  Upon receipt of  such  notice and payment in full
of the Purchase Price and tax withholding liability,  the  Company shall cause
to be issued a certificate representing the shares of Common Stock purchased.

                        (3)  Vesting   periods  are  determined  based  on the
number of shares granted per the schedule below:
 
            Number of Shares        Vesting period      %   vested  per year
            Less than  500                1 year                  100%
                      1000                2 years                  50%
                      2000                3 years                  33.3%
            More than 3000                4 years                  25%

            (c)         Except as otherwise  provided in this  Agreement,  the
Option  shall  terminate  on the  earliest of (1) the last day of the Exercise
Period;  (2) the date the Committee  exercises its right pursuant to Section 8
to terminate the Option;  (3) thirty (30) days after Optionee  ceases to be an
Employee,  except if such  termination is due to Termination for Cause,  death
or Disability,  (4) one-hundred  eighty (180) days after Optionee ceases to be
an  Employee  if such  termination  is due to death or  Disability;  or (5) if
Optionee ceases to be an Employee as a result of a Termination for Cause,  the
time of such termination.

            (d)         The price paid by the Company  shall be payable at the
Company's  option (1) by delivery to the  Optionee of the entire  price in the
form of cash or check;  or (2) by payment of four  substantially  equal annual
installments,  the first  installment  being due at the date of termination of
the  Option and the  second,  third and  fourth  installment  being due on the
first,  second  and  third  anniversaries  of the date of  termination  of the
Option, respectively.

      3.          Purchase  Price.  Optionee  must  pay  to  the  Company  the
Exercise  Price  (subject to  adjustment  pursuant to Section 8) multiplied by
the number of the Option  Shares being  acquired  through the exercise of this
Option  (the  "Purchase  Price").  Shares  of  Common  Stock  tendered  by the
Optionee  in  satisfaction  of the  Purchase  Price shall be credited at their
Fair Market Value.

      4.          Non-Transferability  of Option.  Except for any  transfer of
the Option by bequest or  inheritance,  the Optionee  shall not have the right
to make or permit to exist any transfer or hypothecation,  whether outright or
as security, with or without consideration,  voluntary or involuntary,  of all
or any  part  of  any  right,  title  or  interest  in the  Option.  Any  such
disposition  not made in accordance  with this Agreement  shall be deemed null
and void.  The Option  shall be  exercisable  during the  lifetime of Optionee
only by  Optionee,  and  after  his  death  by a  legatee  or  legatees  under
Optionee's  last  will and  testament  or by his  personal  representative  or
representatives,  who shall be bound by the same  terms of this  Agreement  as
apply to the Optionee.

      5.          Restrictions  on  Transfer  of  Option  Shares.   Except  as
provided  in this  Agreement  or for any  transfer  of Option  Shares by gift,
bequest,  or  inheritance  to the  Optionee's  or a  subsequent  shareholder's
family  member,  estate,  heirs,  or  legatees or for any  transfer  after the
closing of an initial public offering of Common Stock,  the Optionee shall not
have the  right to make or  permit to exist  any  transfer  or  hypothecation,
whether outright or as security,  with or without consideration,  voluntary or
involuntary,  of all or any part of any right,  title or  interest  (including
but not  limited  to,  voting  rights)  in or to any Option  Shares.  Any such
disposition  not made in accordance  with this Agreement  shall be deemed null
and void.  Any permitted  transferee  under this Section shall be bound by the
same terms of this Agreement as apply to the Optionee.

      6.          No  Rights  as  Shareholder.   Optionee,  or  his  permitted
transferee  under  Section 4,  shall  have no  rights  as a  stockholder  with
respect to any Option Shares until the issuance of a stock  certificate to him
for such  shares.  No  adjustment  shall be made for  dividends  (ordinary  or
extraordinary,   whether   in  cash,   securities   or  other   property)   or
distributions  or other rights on or with respect to Option  Shares  purchased
pursuant  to this  Option  for which the  record  date is prior to the date of
exercise hereof, except as provided in Section 8 below.

      7.          Repurchase Rights.

            (a)         (1)   At all times  prior to the closing of an initial
public  offering of Common Stock,  or (2) within ninety (90) days  following a
Termination  for Cause,  the Company shall have the right to  repurchase  from
the Optionee all Option Shares.  For this purpose,  a notice of exercise given
by the Company to the  Optionee  pursuant to this Section 7 shall be effective
to  perfect  the  Company's  right of  repurchase,  subject  to the  remaining
provisions of this Section 7.

            (b)         (1)   The  Company  upon   exercising  this  right  of
repurchase  shall give written  notice to the Optionee of the number of shares
of Option Shares to be repurchased,  of the repurchase  price,  which shall be
determined  pursuant to Section 7(c)  hereof,  and of the time and date of the
closing of the repurchase of the Option  Shares,  which shall be no later than
sixty  (60)  days  from  the  date  of the  notice  and  shall  be held at the
principal  office of the Company.  At closing,  the Company  shall deliver the
application  portion of the  repurchase  price and the Optionee  shall deliver
the Option  Shares to be  repurchased  duly endorsed for transfer and with all
required revenue stamps attached,  and the title to the Option Shares shall be
transferred  to  the  Company  free  and  clear  of  all  liens,  claims,  and
encumbrances,   however   described,   except  for  restrictions   imposed  by
applicable securities laws.

                  (1)         If the Company  decides to repurchase  less than
all of the Option Shares owned by the Optionee,  the Company shall employ such
method  as it shall  deem  appropriate  in  determining  the  number of Option
Shares to be repurchased.

                  (2)         The price for Option Shares  repurchased  by the
Company  shall be payable by  delivery  to the  Optionee at the closing of the
entire repurchase price in the form of cash or check;  provided,  however, the
Company  may pay the  entire  repurchase  price  in four  substantially  equal
annual  installments  consisting of principal and interest at the "Prime Rate"
reported in the Wall Street  Journal on the first  business day  preceding the
date of  repurchase,  the first  installment  being due at the closing and the
second,  third, and fourth  installment  being due on the first,  second,  and
third anniversaries of the closing, respectively.

                  (3)         If the Optionee  fails to consummate the sale or
deliver the Option Shares certificates  properly assigned when requested to do
so, the Company, or its designee,  shall cancel the Option Shares certificates
of the Optionee  and deposit the payment  pursuant to Section  7(b)(3)  hereof
which was to be made to the Optionee in exchange for the  certificates  to the
credit or account of the Optionee with escrow with any  clearinghouse  bank in
the  City of  Greenville,  South  Carolina,  at the  expense  and  risk of the
Optionee, or his successors or assigns,  whereupon the Company shall treat the
Option Shares  represented  thereby as having been  repurchased by the Company
or its designees.

            (c)         The  repurchase  price for each Option  Share shall be
an amount  equal to the Fair  Market  Value,  except if the Option  Shares are
repurchased  by the Company  pursuant to written  notice given  within  ninety
(90) days  following a  Termination  for Cause,  in which case the  repurchase
price for each Option  Share  shall be the lower of Fair  Market  Value or the
Exercise Price paid by the Optionee.

      8.          Change  in  Capitalization.   The  total  number  of  Option
Shares to be received  upon  exercise of the Option  (both as to the number of
Option Shares and the Purchase Price) shall be appropriately  adjusted for any
change  in  par  value,   split-up,   stock   split,   reverse   stock  split,
reclassification,  merger,  consolidation,  distribution of stock dividends or
similar  capital  adjustments,  to the end that the  Optionee's  proportionate
interest in value shall be maintained  as before the  occurrence of the event.
The adjustment  shall be made without change in the total price  applicable to
the unexercised  portion of the Option and with a corresponding  adjustment in
the Exercise Price.

      The  foregoing   adjustments  and  the  manner  of  application  of  the
foregoing  provisions  shall  be  determined  by the  Committee  in  its  sole
discretion.  Any adjustment may provide for the  elimination of any fractional
Option Shares.

      Notwithstanding  any other  provision of this  Agreement,  the Committee
reserves the right in the event of a sale of  substantially  all of the Common
Stock or  property  of the  Company  or the  merger  or  consolidation  of the
Company,  or a  dissolution  or  liquidation  of the Company to terminate  the
Option in  consideration  of the  payment to the  Optionee  of the  difference
between (1) and (2) where (1) equals the Fair Market Value of the  unexercised
Option  Shares to the extent  vested and (2) equals the Purchase  Price of the
unexercised Option Shares to the extent vested.

      9.          Governing   Laws.   This   Agreement   shall  be  construed,
administered  and  enforced  according  to the laws of the State of  Delaware;
provided,  however,  the Option may not be exercised except, in the reasonable
judgment  of the Board of  Directors,  in  compliance  with  exemptions  under
applicable  securities laws of the country in which Optionee  resides,  and/or
any other  applicable  securities  laws. In addition,  the Participant  hereby
acknowledges  that this  Option  may have been  granted  prior to the time the
interest  represented  hereby was registered  under  applicable South Carolina
securities  laws and that, as a result,  the Participant may have the right to
rescind the grant of the Option.  This  Agreement,  therefore,  constitutes an
offer to so  rescind  the prior  grant for the  consideration  payable  to the
Optionee  specified  by  Section  35-1-1530  of  the  South  Carolina  Uniform
Securities  Act.   Because,   however,   the  Participant  has  not  paid  any
consideration  for the grant,  the Participant  desires to decline such offer,
and does hereby waive such right of rescission  with respect to this Option as
of the date  hereof.  The Company  agrees to use its best  efforts to register
the  Option  (as  well  as the  Stock  into  which  it is  convertible)  under
applicable  securities laws as soon as practicable,  and in any event prior to
the date on which any portion of the Option is vested hereunder.

      10.         Successors.  This  Agreement  shall  inure to the benefit of
the heirs,  legal  representatives,  successors  and permitted  assigns of the
Company and Optionee.

      11.         Notice.   Any  notice  which  either  party  hereto  may  be
required or  permitted  to give to the other  shall be in writing,  and may be
delivered  personally or by mail,  postage prepaid,  addressed as follows:  to
the President of the Company,  or to the Company (attention of the President),
at 50 Datastream  Plaza,  Greenville,  South Carolina  29605,  or at any other
address as the Company,  by notice to Optionee,  may designate in writing from
time to time; to Optionee,  at  Optionee's  address as shown on the records of
the Company,  or at any other  address as Optionee,  by notice to the Company,
may designate in writing from time to time.

      12.         Severability.  In the  event  that  any  one or  more of the
provisions  or  portion  thereof  contained  in this  Agreement  shall for any
reason be held to be invalid,  illegal or  unenforceable  in any respect,  the
same shall not  invalidate  or otherwise  affect any other  provisions of this
Agreement,  and this Agreement  shall be construed as if the invalid,  illegal
or unenforceable provision or portion thereof had never been contained herein.

      13.         Entire  Agreement.  Subject to the terms and  conditions  of
the Datastream  Systems,  Inc. 1997 Stock Option Plan,  which is  incorporated
herein by reference,  this Agreement  expresses the entire  understanding  and
agreement of the parties hereto with respect to such terms,  restrictions  and
limitations.

      14.         Headings.  Section  headings used herein are for convenience
of reference only and shall not be considered in construing this Agreement.

      15.         Specific  Performance.   In  the  event  of  any  actual  or
threatened  default  in,  or  breach  of,  any of the  terms,  conditions  and
provisions of this Agreement,  the party or parties who are thereby  aggrieved
shall have the right to specific  performance  and  injunction  in addition to
any and all  other  rights  and  remedies  at law or in  equity,  and all such
rights and remedies shall be cumulative.

      16.         Resolution    of    Disputes.     Any    determination    or
interpretation by the Committee shall be final,  binding and conclusive on all
persons affected thereby.

      17.         Compliance with Securities  Laws.  Notwithstanding  anything
contained  herein to the contrary,  no purported  exercise of the Option shall
be  effective  without  the  written  approval  of the  Company,  which may be
withheld  to the  extent  that its  exercise,  either  individually  or in the
aggregate  together  with the  exercise of other  previously  exercised  stock
options  and/or  offers  and  sales  pursuant  to any  prior  or  contemplated
offering  of  securities,  would,  in the sole and  absolute  judgment  of the
Company,  require  the  filing of a  registration  statement  with the  United
States Securities and Exchange Commission,  or with the securities  commission
of  any  state.  The  Company  shall  avail  itself  of  any  exemptions  from
registration  contained in applicable  tax and securities  laws which,  in its
sole and absolute  discretion,  it deems reasonable and not unduly  burdensome
or costly.  The Optionee  shall deliver to the Company,  prior to the exercise
of  the  Option,  such  information,  representations  and  warranties  as the
Company  may  request in order for the  Company  to be able to satisfy  itself
that the Common  Stock to be acquired  pursuant to the  exercise of the Option
is being  acquired in  accordance  with the terms of an  applicable  exemption
from the securities registration requirements of applicable securities laws.

                                   * * * * *
EXHIBIT 99.2

                           DATASTREAM SYSTEMS, INC.
                            1998 STOCK OPTION PLAN

                            SECTION I. DEFINITIONS

      Whenever used herein,  the masculine  pronoun shall be deemed to include
the  feminine,  and the  singular to include  the  plural,  unless the context
clearly indicates otherwise,  and the following  capitalized words and phrases
are used herein with the meaning thereafter ascribed:

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

      1.2   "Change of Control" means (i) an acquisition by any individual,
entity or group (within the meaning of Sections 13(d)(3) or 14(d)(2) of the
Exchange Act (a "Person") of beneficial ownership of 50 percent or more of
the total outstanding Voting Securities of the Company, other than any
acquisition by the Company or any employee benefit plan that the Company
sponsors, (ii) any sale, exchange, merger, consolidation, reorganization,
tender offer for shares of Stock or other similar business transaction
involving the Company (a "business transaction"), unless, following such
business transaction, more than 50 percent of the total outstanding Voting
Securities of the Company (or other entity surviving such business
transaction) is then beneficially owned, directly or indirectly, by all or
substantially all of the Persons who were beneficial owners of the Voting
Securities of the Company immediately before such business transaction, and
(iii) the sale or other disposition of all or substantially all of the assets
of the Company, other than to a corporation with respect to which following
such sale or other disposition more than 50 percent of the total outstanding
Voting Securities of such corporation is then beneficially owned, directly or
indirectly, by all or substantially all of the Persons who were beneficial
owners of the Voting Securities of the Company immediately before such sale
or other disposition.

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

      1.4   "Committee"  means  the  committee   consisting  of  two  or  more
Non-Employee Directors appointed by the Board to administer the Plan.

      1.5   "Company" means Datastream Systems, Inc., a Delaware corporation.

      1.6   "Disposition" means any conveyance,  sale,  transfer,  assignment,
pledge or  hypothecation,  whether  outright  or as  security,  inter vivos or
testamentary, with or without consideration, voluntary or involuntary.

      1.7   "Exchange  Act"  means the  Securities  Exchange  Act of 1934,  as
amended from time to time.

      1.8   "Exercise  Price"  means the price per share of Stock  purchasable
under any Option.

      1.9   "Fair Market  Value" with regard to a date means the closing price
at which  Stock  shall have been sold on the last  trading  date prior to that
date as reported by the Nasdaq National  Market System (or, if applicable,  as
reported by a national  securities exchange selected by the Committee on which
the  shares of Stock  are then  actively  traded)  and  published  in The Wall
Street  Journal;  provided that,  for purposes of granting  Options other than
incentive  stock  options,  Fair  Market  Value of the  shares of Stock may be
determined  by  the  Committee  by  reference  to  the  average  market  value
determined  over a period certain or as of specified  dates, to a tender offer
price for the shares of Stock (if  settlement of an award is triggered by such
an event) or to any other  reasonable  measure of fair market value. If at the
time of the  determination  of Fair  Market  Value  shares  of  Stock  are not
actively  traded on any market  described  above,  Fair Market Value means the
fair market value of a share of Stock as determined  by the  Committee  taking
into  account  such  facts  and  circumstances  deemed to be  material  by the
Committee  to  the  value  of  the  Stock  in the  hands  of the  Participant;
provided,  however, for purposes of determining the Option price per share for
an  incentive  stock  option,  Fair Market  Value shall be  determined  by the
Committee  without regard to any restriction  other than a restriction  which,
by its  terms,  will never  lapse.  Fair  Market  Value as  determined  by the
Committee shall be final, binding and conclusive upon each Participant.

      1.10  "Non-Employee  Director" means a director who (i) is not a current
employee or officer of the Company or any of its  Subsidiaries,  and has never
been an  officer  of the  Company or any of its  Subsidiaries,  (ii) does  not
receive compensation,  either directly or indirectly,  from the Company or any
of its  Subsidiaries  for services  rendered in any  capacity  other than as a
director,  (iii) does not  possess an interest  in any other  transaction  for
which  disclosure  would  be  required   pursuant  to  Regulation  S-K  404(a)
promulgated  under the  Exchange  Act, and (iv) is not engaged in any business
relationship  for which  disclosure  would be required  pursuant to Regulation
S-K 404(b) promulgated under the Exchange Act.

      1.11  "Option" means a non-qualified  stock option or an incentive stock
option.

      1.12  "Over 10% Owner" means an individual  who at the time an incentive
stock  option is  granted  owns  Stock  possessing  more than 10% of the total
combined  voting power of the Company or one of its  Subsidiaries,  determined
by applying the attribution rules of Code Section 424(d).

      1.13  "Participant"   means  an   individual   who  receives  an  Option
hereunder.

      1.14  "Plan" means the Datastream Systems, Inc. 1998 Stock Option Plan.

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

      1.16  "Stock" means the Company's common stock, $.01 par value.

      1.17  "Stock Option  Agreement"  means an agreement  between the Company
and a Participant or other documentation evidencing an award of an Option.

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

      1.19  "Voting  Securities"  means  the  shares  of  capital  stock of an
entity entitled to vote generally in the election of that entity's directors.

                             SECTION 2. THE PLAN

      2.1   Purpose  of  the  Plan.  The  Plan  is  intended  to  (a)  provide
incentive  to  selected  employees  and  consultants  of the  Company  and its
Subsidiaries  to stimulate  their efforts toward the continued  success of the
Company  and to operate  and manage the  business  of the  Company in a manner
that will provide for the long-term  growth and  profitability of the Company;
(b)  encourage  stock  ownership  by selected  employees  and  consultants  by
providing them with a means to acquire a proprietary  interest in the Company;
and  (c)  provide  a  means  of  obtaining,  rewarding  and  retaining  select
employees and consultants.

      2.2   Stock  Subject to the Plan.  Subject to  adjustment  in accordance
with Section 4.2 hereof,  500,000  shares of Stock (the "Maximum Plan Shares")
are hereby reserved  exclusively for issuance pursuant to Options.  At no time
shall the  Company  have  outstanding  Options  and shares of Stock  issued in
respect  of Options  granted  under  this Plan in excess of the  Maximum  Plan
Shares;  for this purpose,  the shares of Stock attributable to the nonvested,
unpaid, unexercised,  unconverted or otherwise unsettled portion of any Option
that is forfeited or canceled or expires or terminates  for any reason without
becoming  vested,  paid,  exercised,  converted or  otherwise  settled in full
shall again be available for purposes of the Plan.

      2.3   Administration  of the Plan.  The Plan  shall be  administered  by
the  Committee.  The Committee  shall have full authority in its discretion to
determine  the  persons to whom  Options  shall be  granted  and the terms and
provisions of Options,  subject to the Plan.  Subject to the provisions of the
Plan, the Committee shall have full and conclusive  authority to interpret the
Plan; to prescribe,  amend and rescind rules and  regulations  relating to the
Plan; to determine the terms and  provisions  of the  respective  Stock Option
Agreements,  to accelerate the time at which Options can be exercised,  and to
make  all  other   determinations   necessary  or  advisable  for  the  proper
administration  of the Plan.  The  Committee's  determinations  under the Plan
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).  The  Committee's  decisions  shall be
final and binding on all Participants.

      2.4   Eligibility  and Limits.  Options may be granted only to employees
and consultants of the Company and its Subsidiaries;  provided,  however, that
an  incentive  stock  option may only be granted to an employee of the Company
or any  Subsidiary.  Only  directors who are also employees of the Company may
receive  grants of Options  under this Plan.  In the case of  incentive  stock
options,  if the  aggregate  Fair Market Value  (determined  as of the date an
incentive  stock  option is  granted) of Stock with  respect to which  Options
intended to meet the  requirements of Code Section 422 become  exercisable for
the first time by an  individual  during any calendar  year under all plans of
the  Company  and its  Subsidiaries  exceeds  $100,000,  then  the  number  of
incentive  stock  option(s)  granted  under this Plan which cause the $100,000
limitation to be exceeded shall be treated as non-qualified stock option(s).

                         SECTION 3. TERMS OF OPTIONS

      3.1   Terms and  Conditions of Options.  No more than 500,000  shares of
Stock shall be reserved and available for issuance as Options under the Plan.

            3.1.1 Number of Option  Shares.  The  number of shares of Stock as
      to  which  an  Option  shall  be  granted  shall  be  determined  by the
      Committee in its sole  discretion,  subject to the provisions of Section
      2.2 as to the total  number of shares  available  for  grants  under the
      Plan.  Notwithstanding  the  preceding,  to the  extent  required  under
      Section  162(m)  of  the  Code  and  the   regulations   thereunder  for
      compensation to be treated as qualified performance-based  compensation,
      the maximum  number of shares of Stock with respect to which Options may
      be granted  during any one year period to any employee  shall not exceed
      200,000.

            3.1.2 Stock  Option  Agreement.  Each Option shall be evidenced by
      a Stock  Option  Agreement  in such  form  and  containing  such  terms,
      conditions  and  restrictions  as  the  Committee  may  determine  to be
      appropriate.  Each Stock Option  Agreement shall be subject to the terms
      of the Plan and any provisions  contained in the Stock Option  Agreement
      that are inconsistent with the Plan shall be null and void.

            3.1.3 Type of  Option.  At the time any  Option  is  granted,  the
      Committee  shall  determine  whether  the  Option is  intended  to be an
      incentive stock option  described in Code Section 422 or a non-qualified
      stock  option that is not  governed by Code  Section 422, and the Option
      shall be  clearly  identified  as to its  status as an  incentive  stock
      option  or a  non-qualified  stock  option.  At the time  any  incentive
      stock option  granted under the Plan is exercised,  the Company shall be
      entitled  to legend the  certificates  representing  the shares of Stock
      purchased   pursuant  to  the  Option  to  clearly   identify   them  as
      representing  the shares  purchased  upon the  exercise of an  incentive
      stock option.  An incentive  stock option may only be granted  within 10
      years  from the  earlier of the date the Plan is adopted by the Board or
      approved by the Company's stockholders.

            3.1.4 Exercise  Price.  Subject to adjustment  in accordance  with
      Section 4.2 and the other  provisions  of this  Section 3, the  Exercise
      Price of an Option shall be as set forth in the applicable  Stock Option
      Agreement.  Notwithstanding  the preceding,  the Exercise Price under an
      incentive  stock  option shall not be less than the Fair Market Value of
      the  underlying  Stock on the  date  the  Option  is  granted,  and with
      respect to each grant of an incentive  stock option to a Participant who
      is an Over 10% Owner,  the Exercise Price shall not be less than 110% of
      the Fair Market Value of the underlying  Stock on the date the Option is
      granted.

            3.1.5 Option  Term.  Any  incentive  stock  option  granted  to  a
      Participant who is not an Over 10% Owner shall not be exercisable  after
      the  expiration  of 10 years after the date the Option is  granted.  Any
      incentive  stock  option  granted  to a  Participant  who is an Over 10%
      Owner shall not be exercisable  after the expiration of five years after
      the date the  Option is  granted.  The term of any  non-qualified  stock
      option shall be as specified in the applicable Stock Option Agreement.

            3.1.6 Payment.   Payment   for  all  shares  of  Stock   purchased
      pursuant  to the  exercise  of an  Option  shall  be made in any form or
      manner  authorized  by the  Committee  in the  Stock  Option  Agreement,
      including,  but not  limited  to,  (i)  cash,  (ii) by  delivery  to the
      Company  of a number  of shares of Stock  which  have been  owned by the
      Participant  for at least  six  months  prior  to the  date of  exercise
      having an  aggregate  Fair Market  Value of not less than the product of
      the Exercise  Price  multiplied by the number of shares the  Participant
      intends  to  purchase  upon  exercise  of  the  Option  on the  date  of
      delivery;  (iii) in a  cashless  exercise  through a broker;  or (iv) by
      having a number of shares of Stock  withheld,  the Fair Market  Value of
      which as of the date of exercise is  sufficient  to satisfy the Exercise
      Price.  In its  discretion,  the  Committee  also may  authorize (at the
      time an Option is granted or  thereafter)  Company  financing  to assist
      the  Participant  as to payment of the  Exercise  Price on such terms as
      may be offered by the Committee in its  discretion.  Any such  financing
      shall require the payment by the  Participant  of interest on the amount
      financed  at a rate not less than the  "applicable  federal  rate" under
      the Code. If a Stock Option  Agreement so provides,  the Participant may
      be  granted a new Option to  purchase a number of shares of Stock  equal
      to the number of  previously-owned  shares of Stock  tendered in payment
      for each  share of Stock  purchased  pursuant  to the terms of the Stock
      Option  Agreement.  Any such new  Option  shall be  subject to the terms
      and conditions of the Stock Option Agreement  pursuant to which such new
      Option is granted.  Payment of the  Exercise  Price shall be made at the
      time the  Option  or any part  thereof  is  exercised,  and no shares of
      Stock shall be issued or  delivered  upon  exercise  of an Option  until
      full  payment  has  been  made  by the  Participant.  The  holder  of an
      Option,  as such,  shall have none of the rights of a stockholder  until
      delivery of the  certificate(s)  representing  the Stock the Participant
      has purchased.

            3.1.7 Conditions  to the Exercise of an Option.  Each Option shall
      be  exercisable by the  Participant  at such time or times,  or upon the
      occurrence  of  such  event  or  events,  and in  such  amounts,  as the
      Committee  shall  specify  in  the  Stock  Option  Agreement;  provided,
      however,  that subsequent to the grant of an Option,  the Committee,  at
      any time before complete  termination of such Option, may accelerate the
      time or times at  which  such  Option  may be  exercised  in whole or in
      part, and may permit the Participant or any other  designated  person to
      exercise  the  Option,  or any portion  thereof,  for all or part of the
      remaining  Option  term,  notwithstanding  any  provision  of the  Stock
      Option Agreement to the contrary.

            3.1.8 Termination  of Incentive  Stock Option.  With respect to an
      incentive  stock option,  in the event of termination of employment of a
      Participant  for any reason other than death or  disability,  the Option
      or portion  thereof held by the Participant  which is unexercised  shall
      expire,   terminate,   and  become   unexercisable  no  later  than  the
      expiration of three months after the date of  termination of employment;
      provided,  however,  that in the case of a holder whose  termination  of
      employment  is  due  to  death  or  disability   ("disability"   meaning
      "disabled" within the meaning of Code Section 22(e)(3)),  one year shall
      be  substituted  for such  three  month  period.  For  purposes  of this
      Subsection  3.1.8,  termination of employment of the  Participant  shall
      not be  deemed  to have  occurred  if the  Participant  is  employed  by
      another  corporation  (or a parent  or  subsidiary  corporation  of such
      other  corporation)  which has assumed the incentive stock option of the
      Participant in a transaction to which Code Section 424(a) is applicable.

            3.1.9 Special   Provisions   for   Certain   Substitute   Options.
      Notwithstanding  anything to the  contrary in this Section 3, any Option
      issued in  substitution  for an  option  previously  issued  by  another
      entity,  which  substitution  occurs in connection with a transaction to
      which Code  Section  424(a) is  applicable,  may provide for an exercise
      price computed in accordance  with such Code Section and the regulations
      thereunder  and may  contain  such  other  terms and  conditions  as the
      Committee  may prescribe to cause such  substitute  Option to contain as
      nearly  as  possible  the  same  terms  and  conditions  (including  the
      applicable  vesting and  termination  provisions) as those  contained in
      the previously-issued option being replaced thereby.

            3.1.10      Date of Grant.  The date an Option  is  granted  shall
      be  the  date  on  which  the  Committee  has  approved  the  terms  and
      conditions of the Option and has  determined the recipient of the Option
      and the  number of shares  covered  by the Option and has taken all such
      other action necessary to complete the grant of the Option.

            3.1.11      Nonassignability.  Options  shall not be  transferable
      or   assignable   except  by  will  or  by  the  laws  of  descent   and
      distribution.   Such   Options   shall  be   exercisable,   during   the
      Participant's lifetime, only by the Participant;  or in the event of the
      death  of  the  Participant,   by  the  legal   representatives  of  the
      Participant's  estate or if no legal  representative has been appointed,
      by the successor in interest  determined under the  Participant's  will.
      Notwithstanding  the two prior  sentences,  however,  if the  applicable
      Stock Option Agreement so provides,  a Participant may assign all or any
      portion  of an  Option  granted  to him that is not an  incentive  stock
      option to (i) his spouse or lineal descendants,  (ii) one or more trusts
      for  the   benefit  of  his  spouse  or  lineal   descendants,   (iii) a
      partnership  of which  his  spouse or  lineal  descendants  are the only
      partners,   or  (iv) a  tax  exempt   organization   as   described   in
      Section 501(c)(3)  of the Code,  as may be  permitted  under  Securities
      Exchange  Commission  Rule 16b-3 as in effect from time to time. In that
      event, the spouse, lineal descendant,  trust,  partnership or tax exempt
      organization  will be entitled  to all of the rights of the  Participant
      with  respect to the assigned  portion of such  Option,  and such Option
      will  continue  to be  subject to all of the terms and  conditions  that
      governed  the  Option  during  the  period  that  it  was  held  by  the
      Participant;  provided,  however,  that such  assignee  may not  further
      assign  the  Option  except  by  will  or by the  laws  of  descent  and
      distribution.  Any  such  assignment  will  be  permitted  only  if  the
      Participant    does   not   receive   any    consideration    therefore.
      Additionally,  in  order  for  an  assignment  by a  Participant  to  be
      effective,  (i) at  least 30 days prior to the date of  assignment,  the
      Participant  must  notify  the  Company  in  writing  of the date of the
      assignment,  the Option or portion  thereof to be assigned and the name,
      address,    telephone   number   and   social   security   or   employer
      identification  number of the assignee,  (ii) at the time of assignment,
      the Participant must execute an appropriate  written  agreement that the
      Company  provides to evidence the  assignment  and to agree to remit any
      applicable  withholding the Company may require and (iii) at the time of
      assignment,  the  assignee  pursuant  to a  written  agreement  that the
      Company  provides  must  agree  to  be  bound  by  the  same  terms  and
      conditions  that  governed  the Option  during the period it was held by
      the Participant.

      3.2   Treatment  of Option Upon  Termination  of  Employment.  Except as
otherwise  provided  by  Plan  Subsection  3.1.8,  any  Option  granted  to  a
Participant  whose  employment  with the  Company has been  terminated  may be
canceled,  accelerated  or  continued,  as  provided in the  applicable  Stock
Option Agreement,  or, in the absence of such provision,  as the Committee may
determine.  The portion of any grant  exercisable in the event of continuation
may be  adjusted  by the  Committee  to reflect  the  Participant's  period of
service  from  the  date  of  grant  through  the  date  of the  Participant's
termination  of employment  or such other factors as the Committee  determines
are relevant to its decision to continue the award.

                        SECTION 4. GENERAL PROVISIONS

      4.1   Withholding.  Whenever  the  Company  proposes  or is  required to
issue or transfer  shares of Stock under the Plan,  the Company  shall require
the  recipient  to remit to the  Company,  as a condition  to  exercising  the
Option,  an  amount  sufficient  to  satisfy  any  federal,  state  and  local
withholding  tax  requirements  prior to the  delivery of any  certificate  or
certificates  for such shares.  A  Participant  may pay the  withholding  tax:
(i) in cash;  (ii) if the Stock Option  Agreement so provides,  by delivery to
the Company of a number of shares of Common  Stock which has been owned by the
Participant for at least six months prior to the date of exercise which,  when
multiplied  by the Fair Market Value of the shares of Stock  determined  as of
the Tax Date (defined  below),  is sufficient  to satisfy  federal,  state and
local, if any,  withholding taxes arising from exercise of an Option; or (iii)
if the Stock Option  Agreement so provides,  a  Participant  may elect to have
the number of shares of Stock he is to receive  reduced by the smallest number
of whole shares of Stock which,  when  multiplied  by the Fair Market Value of
the shares of Stock  determined  as of the Tax Date is  sufficient  to satisfy
federal,  state and local, if any,  withholding taxes arising from exercise of
an Option  (clauses  (ii) and (iii) each being a  "Withholding  Election").  A
Participant  may make a  Withholding  Election  only if both of the  following
conditions are met:

            4.1.1 The  Withholding  Election  must be made on or  prior to the
      date on which the amount of tax  required to be  withheld is  determined
      (the "Tax Date") by executing  and  delivering to the Company a properly
      completed   notice  of   Withholding   Election  as  prescribed  by  the
      Committee; and

            4.1.2 Any Withholding  Election made will be irrevocable except on
      six months  advance  written notice  delivered to the Company;  however,
      the Committee may in its sole  discretion  disapprove and give no effect
      to the Withholding Election.

      4.2   Changes In Capitalization; Merger; Liquidation.
            -----------------------------------------------

            4.2.1 The  number  of shares  of Stock  reserved  for the grant of
      Options;  the number of shares of Stock  reserved for issuance  upon the
      exercise or payment, as applicable,  of each outstanding Option; and the
      Exercise  Price of each  outstanding  Option  shall  be  proportionately
      adjusted for any increase or decrease in the number of issued  shares of
      Stock  resulting from a subdivision or combination of shares of Stock or
      the  payment  of a stock  dividend  in  shares  of Stock to  holders  of
      outstanding  shares of Stock or any other  increase  or  decrease in the
      number  of shares  of Stock  outstanding  effected  without  receipt  of
      consideration by the Company.

            4.2.2 In the event of or in anticipation of a sale, exchange,
      merger, consolidation, reorganization, tender offer for shares of Stock
      or other similar business transaction involving the Company, the
      Committee may make such adjustments with respect to awards and take
      such other action as it deems necessary or appropriate to reflect such
      sale, exchange, merger, consolidation, reorganization, tender offer or
      other similar business transaction including, without limitation, the
      substitution of new awards, the termination or adjustment of
      outstanding awards, the acceleration of awards, or the removal of
      restrictions on outstanding awards. Notwithstanding the foregoing
      sentence, however, in the event of or in anticipation of a sale,
      exchange, merger, consolidation, reorganization, tender offer for
      shares of Stock or other similar business transaction involving the
      Company that would result in a Change of Control, any Option granted
      hereunder shall become immediately exercisable in full, and shall
      remain so, regardless of any provisions contained in the applicable
      Stock Option Agreement with respect thereto limiting the exercisability
      of the Option for any length of time or terminating the Option prior to
      the expiration of its remaining term, subject to all the terms hereof
      and of the Stock Option Agreement with respect thereto not inconsistent
      with this sentence. Any adjustment pursuant to this Section 4.2 may
      provide, in the Committee's discretion, for the elimination without
      payment therefor of any fractional shares that might otherwise become
      subject to any Option, but shall not otherwise diminish the
      then-current value of the Option.

            4.2.3 The existence of the Plan and the Options  granted  pursuant
      to the Plan  shall not limit or  otherwise  adversely  affect in any way
      the right or power of the Company to make or authorize  any  adjustment,
      reclassification,  reorganization  or other  change  in its  capital  or
      business  structure,  any merger or  consolidation  of the Company,  any
      issue of debt or equity securities  having  preferences or priorities as
      to the Stock or the rights  thereof,  the  dissolution or liquidation of
      the Company,  any sale or transfer of all or any part of its business or
      assets, or any other corporate act or proceeding.

      4.3   Cash  Awards.   The  Committee   may,  at  any  time  and  in  its
discretion,  grant to any  holder of an Option the right to  receive,  at such
times and in such amounts as determined by the Committee in its discretion,  a
cash amount  which is intended to  reimburse  such person for all or a portion
of the federal,  state and local  income  taxes  imposed upon such person as a
consequence of the receipt of the Option or the exercise of rights thereunder.

      4.4   Compliance  with Code.  All incentive  stock options to be granted
hereunder are intended to comply with Code Section 422, and all  provisions of
the Plan and all incentive stock options granted  hereunder shall be construed
in such a manner as to  effectuate  that  intent.  However,  no Option that is
intended  to be an  incentive  stock  option  shall be invalid  for failure to
qualify as an incentive stock option.  A Participant  shall notify the Company
of any sale or other  Disposition of Stock  acquired  pursuant to an incentive
stock option if such sale or other Disposition  occurs (i) within two years of
grant of the  incentive  stock  option or (ii) within one year of the issuance
of the  Stock  to  the  Participant.  Such  notice  shall  be in  writing  and
directed to the Secretary of the Company.

      4.5   Right  to  Terminate  Employment.  Nothing  in the  Plan or in any
Option shall confer upon any  Participant the right to continue as an employee
or  consultant  of the  Company or any  Subsidiary  or affect the right of the
Company or any Subsidiary to terminate the  Participant's  employment or other
relationship with the Company or any Subsidiary at any time.

      4.6   Non-alienation of Benefits.  Other than as specifically  permitted
in Section  3.1.11,  no benefit  under the Plan shall be subject in any manner
to anticipation,  alienation, sale, transfer,  assignment, pledge, encumbrance
or  charge;  and any  attempt to do so other  than as  specifically  permitted
thereunder shall be void. No such benefit shall,  prior to receipt,  be in any
manner   liable  for  or  subject  to  the  debts,   contracts,   liabilities,
engagements or torts of the recipient.

      4.7   Restrictions  on  Delivery  and  Sale  of  Shares;  Legends.  Each
Option is subject to the condition that if at any time the  Committee,  in its
discretion,  shall determine that the listing,  registration or  qualification
of the shares  covered by such  Option upon any  securities  exchange or under
any state or federal law is  necessary  or  desirable  as a condition of or in
connection with the granting of such Option,  the assignment of such Option or
the  purchase  or delivery of shares  thereunder,  the  delivery of any or all
shares  pursuant to such Option may be withheld unless and until such listing,
registration  or  qualification  shall have been  affected.  If a registration
statement is not in effect under the Securities  Act, or any applicable  state
securities  laws with respect to the shares of Stock  purchasable or otherwise
deliverable  under Options then outstanding,  the Committee may require,  as a
condition  of  assignment  or exercise of the Option or as a condition  to any
other delivery of Stock pursuant to an Option,  that the  Participant or other
recipient  of an  Option  represent,  in  writing,  that the  shares  received
pursuant to the Option are being  acquired for  investment and not with a view
to  distribution  and agree that the  shares  will not be  disposed  of except
pursuant to an  effective  registration  statement,  unless the Company  shall
have received an opinion of counsel that such  disposition is exempt from such
requirement  under the  Securities  Act and any  applicable  state  securities
laws. The Company may include on certificates  representing  shares  delivered
pursuant to an Option such legends referring to the foregoing  representations
or  restrictions  or  any  other  applicable  restrictions  on  resale  as the
Company, in its discretion, shall deem appropriate.

      4.8   Termination  and Amendment of the Plan.  The Board at any time may
amend or terminate the Plan without stockholder approval;  provided,  however,
that the Board may condition any amendment on the approval of  stockholders of
the Company if such  approval is necessary  or advisable  with respect to tax,
securities  or  other  applicable  laws.  No  such  termination  or  amendment
without  the  consent of the  Participant  holding an Option  shall  adversely
affect the rights of such Participant with respect to such Option.

      4.9   Choice of Law.  The laws of the  State of  Delaware  shall  govern
the Plan, to the extent not preempted by federal law.

      4.10  Effective  Date of  Plan.  The  Plan  became  effective  on May 8,
1998,  the  date  of its  approval  by the  Board,  subject,  however,  to the
subsequent  approval of the Plan by the Company's  stockholders  within twelve
months after the Board's approval of the Plan.