COREL CORPORATION

STOCK OPTION PLAN 2000

1. Purpose of the Plan

The purpose of the Stock Option Plan 2000 is to develop the interest and
incentive of eligible participants of Corel Corporation and its subsidiaries
(the "Company") in the Company's growth and development by giving eligible
participants an opportunity to purchase Common Shares on a favourable basis,
thereby advancing the interests of the Company and its shareholders and
increasing the ability of the Company to attract and retain skilled and
motivated individuals in the service of the Company.

The Board of Directors has approved the terms of this Plan.

2. Definitions

In this Plan:

(a) "Associate" has the meaning assigned by the Securities Act (Ontario), as
amended from time to time;

(b) "Board of Directors" means the board of directors of the Company;

(c) "Committee" means the appropriate compensation committee of three or more
members appointed by the Board of Directors to administer the Plan. All
references in the Plan to the Committee means the Board of Directors if no
Committee has been appointed;

(d) "Common Shares" means the Common Shares of the Company or in the event of an
adjustment contemplated in Section 9 hereof, such other Common Shares to which a
Participant may be entitled upon the exercise of an option as a result of such
readjustment;

(e) "Consultant" means a person that

(i) is engaged to provide on a bona fide basis consulting, technical, management
or other services to the Company under a written contract between the Company
and that person or a company or partnership of which that person is an employee,
shareholder or partner; and

(ii) in the reasonable opinion of the Company, spends or will spend a
significant amount of time and attention on the affairs and business of the
Company;

(f) "Date of Grant" means the date a Participant is granted an option to
purchase Option Shares;

(g) "Director" means a person occupying the position of director on the Board of
Directors of the Company or on the board of directors of any subsidiary of the
Company;

(h) "Employee" means a full time permanent employee of the Company or its
subsidiaries, including any individual who has accepted an offer of employment
from the Company or any of its subsidiaries;

(i) "Exchange" means The Toronto Stock Exchange;

(j) "Exercise Date" means the last Friday of any calendar month during the
Option Period or such other date designated from time to time by the Chief
Executive Officer with respect to any Participant provided that on any such
date, the Company receives from the Participant a completed Stock Option
Purchase Form with payment for the Option Shares being purchased;

(k) "Former Plan" means the Corel Corporation Stock Option Plan dated January
25, 1990 as amended on September 17, 1992, November 22, 1993, March 31, 1994,
March 30, 1995, March 12, 1996 and April 18, 1997;

 

(l) "Insider" means:

(i) an insider of the Company as defined by the Securities Act (Ontario) as
amended from time to time, other than a person who falls within such definition
solely by virtue of being a director or senior officer of a subsidiary of the
Company; and

(ii) an Associate of any person who is an insider by virtue of clause (a) of
this definition;

(m) "Market Price" per Common Share at any date shall be the closing price of
the Common Shares on the Exchange (or, if the Common Shares are not then listed
or posted for trading on the Exchange, on such stock exchange in Canada on which
such shares are listed and posted for trading as may be selected for such
purposes by the Committee) on the trading date immediately preceding the Date of
Grant. In the event that the Common Shares are not listed and posted for trading
in any stock exchange in Canada, the market price shall be the last trading
price of the Common Shares on National Association of Securities Dealers
Quotations Systems ("NASDAQ") on the trading day immediately preceding the Date
of Grant. In the event that the Common Shares are not trading on NASDAQ, the
market price shall be determined by the Committee in its sole discretion;

(n) "Officer" means a person appointed as an officer of the Company by the Board
of Directors or as an officer of any subsidiary of the Company by the board of
directors of such subsidiary;

(o) "Option Period" means the period set forth in Section 6 during which a
Participant may purchase Option Shares;

(p) "Option Price" means the price per share at which a Participant may purchase
Option Shares denominated in Canadian or United States currency;

(q) "Outstanding Issue" means the number of Common Shares that are outstanding
immediately prior to any issuance of options under this Plan or any issuance of
Option Shares, as the case may be, excluding Option Shares issued pursuant to
the Plan or the Former Plan during the preceding one year period;

(r) "Option Shares" means the Common Shares of the Company which a Participant
is entitled to purchase under the Plan;

(s) "Participants" means Employees, Directors, Officers and Consultants to whom
options to purchase Option Shares are granted pursuant to the Plan and which
remain unexercised;

(t) "Plan" means the Corel Corporation Stock Option Plan 2000; and

(u) "Stock Option Purchase Form" shall mean such form as may from time to time
be determined by the Company.

3. Eligibility

Participation in the Plan shall be limited to Participants who are designated
from time to time by the Committee. Participation shall be voluntary and the
extent to which any Participant shall be entitled to participate in the Plan
shall be determined by the Committee.

4. Number of Option Shares and Limitations on Issuance

The aggregate number of Option Shares which may be issued hereunder shall not
exceed 10,400,000. The following restrictions shall also apply to this Plan:

(a) the number of Option Shares reserved for issuance pursuant to options
granted to insiders shall not exceed 10% of the Outstanding Issue;

(b) insiders shall not be issued, within any one year period, a number of Option
Shares which exceeds 10% of the Outstanding Issue;

(c) no insider and such insider's Associates shall be issued, within any one
year period, a number of Option Shares which exceeds 5% of the Outstanding
Issue; and

(d) the aggregate number of Option Shares reserved for issuance pursuant to
options granted to any one Participant shall not exceed 5% of the Outstanding
Issue.

No fractional shares may be purchased or issued hereunder. Subject to the
foregoing, the number of Option Shares that a Participant is entitled to
purchase under the Plan will be determined by the Committee. For greater
certainty, any Common Shares which are the subject of an option granted
hereunder, which options are terminated or expire or are surrendered, shall be
available for the further grant of options hereunder.

5. Price for Option Shares

The Committee shall advise each Participant designated to participate in the
Plan of the number of Option Shares such Participant is entitled to purchase,
the Option Price at which the Option Shares may be purchased and the Exercise
Date(s) upon which the Option Shares may be purchased. The Option Price at which
Option Shares may be purchased under the Plan shall be fixed by the Committee
and confirmed by the Board of Directors and shall be not less than the Market
Price of the Common Shares of the Company at the Date of Grant.

The Chief Executive Officer of the Company may grant options from time to time
between meetings of the Committee in the amount of up to 100,000 Common Shares
in the aggregate and upon the reporting from time to time of the grant of such
Option Shares to a meeting of the Board of Directors, the amount available for
such grants by the Chief Executive Officer shall be restored to the full amount
of 100,000 Common Shares.

6. Exercise

Subject to the requirements of applicable regulatory authorities, the exercise
period and vesting period of any option shall be determined by the Committee and
shall be set forth in the notice of grant of such option. In the event that no
exercise or vesting period is specified by the Committee, each option granted
under the Plan shall vest and may be exercised as follows:

Percentage of Total Number of Option Shares which may be Purchased Option Period
33 1/3% Four years commencing on the Date of Grant 33 1/3% Three years
commencing on the first anniversary of Date of Grant 33 1/3% Two years
commencing on the second anniversary of the Date of Grant

Any Option Shares not purchased by a Participant during the Option Period shall
lapse and such Participant shall have no further right to purchase such shares.

7. Payment

The Participant from time to time and at any time during the Option Period, may
elect to purchase all or a portion of the Option Shares available for purchase
during the Option Period by lump sum payment by delivering to the Company on the
relevant Exercise Date a completed Stock Option Purchase Form. Such Form shall
specify the number of Option Shares the Participant desires to purchase and
shall be accompanied by payment in full of the purchase price for such Option
Shares. Payment may be made by cash, certified cheque, bank draft, money order
or the equivalent payable to the order of the Company.

8. Share Certificates

Upon exercise of the option and payment in full of the Option Price, the Company
shall cause to be delivered to the Participant within a reasonable period of
time a certificate or certificates in the name of the Participant representing
the number of Option Shares the Participant has purchased.

9. Adjustments in Shares

The number of Common Shares subject to the Plan, the number of Common Shares
available under options granted and the Option Price shall be adjusted
automatically from time to time to reflect adjustments in the number of Common
Shares arising as a result of subdivision, stock dividends, consolidations or
reclassification of the Common Shares or other relevant changes in the
authorized or issued capital of the Company. In the event that the Company
proposes to amalgamate, merge or consolidate with any other corporation or to
liquidate, dissolve or wind-up, the Company shall give written notice thereof to
each Participant holding options under the Plan and such Participants shall be
entitled to purchase all or a portion of the Option Shares granted to such
Participants, whether or not such Option Shares have previously vested, within
the 30 day period next following the giving of such notice. Upon the expiration
of such 30 day period, all rights of the Participants to the Option Shares or to
the exercise of same shall terminate and cease to have any further force and
effect.

10. Termination of Employment for Any Reason Other Than Death

(a) Except as otherwise determined pursuant to the provisions of Section 6 and
subject to the provisions of Section 10(b) hereof, in the event that:

(i) an Employee's employment with the Company or any of its subsidiaries is
terminated;

(ii) a Director shall cease to hold office as a Director on the Board of
Directors;

(iii) an Officer who is not also an Employee shall cease to hold office as an
Officer of the Company; or

(iv) a Consultant's engagement by the Company is terminated,

in each case, during the Option Period for any reason other than death, cause or
resignation, such Participant may elect to purchase all or a portion of the
remaining Option Shares that such Participant is entitled to purchase at the
time such employment or engagement is terminated or such Participant ceases to
hold office as a Director or Officer at any time during the 30 day period
commencing on the later of (i) the date of termination of employment or
engagement or ceasing to hold a board or office position, and (ii) the date of
expiry of any contractual restriction on the resale of the Option Shares to
which the Participant is subject (and to which the Participant had consented at
the request of the Company) at the date of termination of employment or
engagement or ceasing to hold a board or office position, but in no event, after
the expiration of the Option Period. In the case of termination of employment or
engagement or ceasing to hold office for cause or resignation, the Participant
shall not be entitled to purchase any Option Shares after the date of
termination. The effective date of termination or ceasing to hold office shall
be the date of death, the date specified in the notice from the Company or, in
the case of resignation, from the Participant, and shall not be affected by the
subsequent decision of any court or other body that the termination was
improper, unlawful, without sufficient notice or otherwise deficient in any
respect. For the purposes of this Plan, the transfer of the Employee's
employment to the Company or to any subsidiary of the Company shall not be
considered a termination of employment and the Employee's rights under the
option shall be the same as if such transfer had not occurred.

(b) At any time before or after the relevant period set forth in Section 10(a),
the Chief Executive Officer may extend such period as it applies to any former
Director, Officer, Employee or Consultant, to a date which shall not be later
than the expiration of the Option Period.

11. Termination by Reason of Death

In the event the Participant dies during the Option Period, the Participant's
legal representative will be permitted to exercise any previously unexercised
vested options granted under the Plan prior to the Participant's death and take
delivery of all Option Shares previously purchased but not delivered, at any
time during the 12 month period commencing on the later of (i) the date of death
of the Participant and (ii) the date of expiry of any contractual restriction on
the resale of the Option Shares to which the Participant was subject (and to
which the Participant had consented at the request of the Company) at the date
of death, but in no event after the expiration of the Option Period.

12. Transfer and Assignment

The Participant's rights under options granted under the Plan are not assignable
or transferable by the Participant or subject to any other alienation, sale,
pledge or encumbrance by the Participant during the Participant's lifetime and,
therefore, the options are exercisable during the Participant's lifetime only by
the Participant. The obligations of each Participant shall be binding on his or
her heirs, executors and administrators.

13. Employment, Office and Board Position Non-Contractual

The granting of an option to a Participant under the Plan does not confer upon
the Participant any right to continue in the employment of the Company or any
subsidiary of the Company, to continue as an Officer of the Company or as a
member of the Board of Directors, or to continue as a Consultant to the Company
as the case may be, nor does it interfere in any way with the rights of the
Employee or of the Company's right to terminate the Employee's employment at any
time, the Board of Director's right to appoint Officers or of the shareholders'
right to elect directors.

14. Rights as Shareholders

Participants shall not have any rights as a shareholder with respect to Option
Shares until full payment has been made to the Company and a share certificate
or share certificates have been duly issued.

15. Participant Loan

The Committee may authorize the Company to lend or cause to be lent to
Participants such portion of the purchase price of the Option Shares under the
Plan as a Participant may request and the Committee administering the Plan may
approve. The terms and conditions of such loan which may be interest bearing or
interest free shall be determined by the Committee in its discretion and need
not be the same in respect of all Participants.

16. Administration of the Plan

The Plan shall be administered by the Board of Directors or the Committee. The
Board of Directors or the Committee shall have the power to interpret and
construe the terms and conditions of the Plan and the options. Any determination
by the Board of Directors shall be final and conclusive on all persons affected
thereby. Any determination by the Committee shall be final and conclusive on all
persons affected thereby unless otherwise determined by the Board of Directors.
The day-to-day administration of the Plan may be delegated to such officers and
employees of the Company or any subsidiary of the Company as the Board of
Directors or the Committee shall determine.

17. Notices

All written notices to be given by the Participant to the Company may be
delivered personally or by registered mail, postage prepaid, addressed as
follows:

Corel Corporation
1600 Carling Avenue
Ottawa, Ontario
KIZ 7M5
Attention: Secretary.

Any notice given by the Participant pursuant to the terms of the option shall
not be

effective until actually received by the Company at the above address. Any
notice to be given to the Participant shall be sufficiently given if delivered
personally or by postage prepaid mail to the last address of the Participant on
the records of the Company and shall be effective seven days after mailing.

18. Corporate Action

Nothing contained in the Plan or in any option shall be construed so as to
prevent the Company or any subsidiary of the Company from taking corporate
action which is deemed by the Company or the subsidiary to be appropriate or in
its best interest, whether or not such action would have an adverse effect on
the Plan.

19. Amendment

The Board of Directors of the Company shall have the right, in its sole
discretion, to alter or amend the Plan from time to time and at any time. No
such amendment, however, may, without the consent of the Participant, alter or
impair his or her rights or increase his or her obligations under the Plan.

20. Governing Law

The Plan is established under the laws of the Province of Ontario and the rights
of all parties and the construction and effect of each provision of the Plan
shall be according to the laws of the Province of Ontario.

21. Government Regulation

The Company's obligation to issue and deliver Common Shares under any option is
subject to:

(a) satisfaction of all requirements under applicable securities law in respect
thereof and obtaining all regulatory approvals as the Company shall determine to
be necessary or advisable in connection with the authorization, issuance or sale
thereof;

(b) the admission of such Common Shares to listing on any stock exchange on
which the Common Shares may then be listed; and

(c) the receipt from the Participant of such representations, agreements and
undertakings as to future dealings in the Common Shares as the Company
determines to be necessary or advisable in order to safeguard against the
violation of the securities law of any jurisdiction.

In this connection the Company shall take all reasonable steps to obtain such
approvals and registrations as may be necessary for the issuance of such Common
Shares in compliance with applicable securities law and for the listing of such
Common Shares on any stock exchange on which the Common Shares are then listed.

22. Approval

The Plan shall be subject to acceptance by the Exchange in compliance with all
conditions imposed by the Exchange. Any options granted prior to such acceptance
shall be conditional upon such acceptance being given and any condition complied
with. No such options may be exercised unless such acceptance is given and such
conditions are complied with.

As amended and restated the 12th day of February, 2002.

COREL CORPORATION

"Derek J. Burney"

President and
Chief Executive Officer

"Robert D. Chapman"

Secretary