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                                                                    EXHIBIT 10.3
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                                MATRIXONE, INC.

                                1999 Stock Plan
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1.   Purpose and Eligibility
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     The purpose of this 1999 Stock Plan (the "Plan") of MatrixOne, Inc. (the
                                               ----
"Company") is to provide stock options and other equity interests in the Company
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(each an "Award") to employees, officers, directors, consultants and advisors of
          -----
the Company and its Subsidiaries, all of whom are eligible to receive Awards
under the Plan.  Any person to whom an Award has been granted under the Plan is
called a "Participant".  Additional definitions are contained in Section 8.
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2.   Administration
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     a.   Administration by Board of Directors.  The Plan will be administered
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by the Board of Directors of the Company (the "Board").  The Board, in its sole
                                               -----
discretion, shall have the authority to grant and amend Awards, to adopt, amend
and repeal rules relating to the Plan and to interpret and correct the
provisions of the Plan and any Award.   All decisions by the Board shall be
final and binding on all interested persons. Neither the Company nor any member
of the Board shall be liable for any action or determination relating to the
Plan.

     b.   Appointment of Committees.  To the extent permitted by applicable law,
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the Board may delegate any or all of its powers under the Plan to one or more
committees or subcommittees of the Board (a "Committee").  All references in the
                                             ---------
Plan to the "Board" shall mean such Committee or the Board.
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     c.   Delegation to Executive Officers.  To the extent permitted by
          --------------------------------
applicable law, the Board may delegate to one or more executive officers of the
Company the power to grant Awards and exercise such other powers under the Plan
as the Board may determine, provided that the Board shall fix the maximum number
of Awards to be granted and the maximum number of shares issuable to any one
Participant pursuant to Awards granted by such executive officers and shall
establish such other terms and conditions to the power of the executive officers
as the Board so chooses.

3.   Stock Available for Awards
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     a.   Number of Shares.  Subject to adjustment under Section 3(c), the
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aggregate number of shares of Common Stock of the Company (the "Common Stock")
                                                                ------------
that may be issued pursuant to the Plan is 500,000 shares.  If any Award
expires, or is terminated, surrendered or forfeited, in whole or in part, the
unissued Common Stock covered by such Award shall again be available for the
grant of Awards under the Plan.  If shares of Common Stock issued pursuant to
the Plan are repurchased by, or are surrendered or forfeited to, the Company at
no more than cost,
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such shares of Common Stock shall again be available for the grant of Awards
under the Plan; provided, however, that the cumulative number of such shares
that may be so reissued under the Plan will not exceed 500,000 shares. Shares
issued under the Plan may consist in whole or in part of authorized but unissued
shares or treasury shares.

     b.   Per-Participant Limit.  Subject to adjustment under Section 3(c), no
          ---------------------
Participant may be granted Awards during any one fiscal year to purchase more
than 100,000 shares of Common Stock.

     c.   Adjustment to Common Stock.  In the event of any stock split, stock
          --------------------------
dividend, extraordinary cash dividend, recapitalization, reorganization, merger,
consolidation, combination, exchange of shares, liquidation, spin-off, split-up,
or other similar change in capitalization or event, (i) the number and class of
securities available for Awards under the Plan and the per-Participant share
limit, (ii) the number and class of securities, vesting schedule and exercise
price per share subject to each outstanding Option, (iii) the repurchase price
per security subject to repurchase, and (iv) the terms of each other outstanding
stock-based Award shall be adjusted by the Company (or substituted Awards may be
made) to the extent the Board shall determine, in good faith, that such an
adjustment (or substitution) is appropriate. If Section 7(e)(i) applies for any
event, this Section 3(c) shall not be applicable.

4.   Stock Options
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     a.   General.  The Board may grant options to purchase Common Stock (each,
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an "Option") and determine the number of shares of Common Stock to be covered by
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each Option, the exercise price of each Option and the conditions and
limitations applicable to the exercise of each Option and the Common Stock
issued upon the exercise of each Option, including vesting provisions,
repurchase provisions and restrictions relating to applicable federal or state
securities laws, as it considers advisable.

     b.   Incentive Stock Options.  An Option that the Board intends to be an
          -----------------------
"incentive stock option" as defined in Section 422 of the Code (an "Incentive
                                                                    ---------
Stock Option") shall be granted only to employees of the Company and shall be
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subject to and shall be construed consistently with the requirements of Section
422 of the Code.  The Board and the Company shall have no liability if an Option
or any part thereof that is intended to be an Incentive Stock Option does not
qualify as such. An Option or any part thereof that does not qualify as an
Incentive Stock Option, or an Option that could qualify but is intentionally not
granted as an Incentive Stock Option, is referred to herein as a "Nonstatutory
                                                                  ------------
Stock Option".
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     c.   Exercise Price.  The Board shall establish the exercise price (or
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determine the method by which the exercise price shall be determined) at the
time each Option is granted and specify it in the applicable option agreement.

     d.   Duration of Options.  Each Option shall be exercisable at such times
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and be subject to such terms and conditions as the Board may specify in the
applicable option agreement.

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     e.   Exercise of Option.  Options may be exercised only by delivery to the
          ------------------
Company of a written notice of exercise signed by the proper person together
with payment in full as specified in Section 4(f) for the number of shares for
which the Option is exercised.

     f.   Payment Upon Exercise.  Common Stock purchased upon the exercise of an
          ---------------------
Option shall be paid for by one or any combination of the following forms of
payment:

          (i)   by check payable to the order of the Company;

          (ii)  except as otherwise explicitly provided in the applicable option
agreement, and only if the Common Stock is then publicly traded, delivery of an
irrevocable and unconditional undertaking by a creditworthy broker to deliver
promptly to the Company sufficient funds to pay the exercise price, or delivery
by the Participant to the Company of a copy of irrevocable and unconditional
instructions to a creditworthy broker to deliver promptly to the Company cash or
a check sufficient to pay the exercise price; or

          (iii) to the extent explicitly provided in the applicable option
agreement, by (x) delivery of shares of Common Stock owned by the Participant
valued at  fair market value (as determined by the Board or as determined
pursuant to the applicable option agreement), or (y) payment of such other
lawful consideration as the Board may determine.

5.   Restricted Stock
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     a.   Grants.  The Board may grant Awards entitling recipients to acquire
          ------
shares of Common Stock, subject to (i) delivery to the Company by the
Participant of a check in an amount at least equal to the par value of the
shares purchased, and (ii) the right of the Company to repurchase all or part of
such shares at their issue price or other stated or formula price from the
Participant in the event that conditions specified by the Board in the
applicable Award are not satisfied prior to the end of the applicable
restriction period or periods established by the Board for such Award (each, a
"Restricted Stock Award").
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     b.   Terms and Conditions. The Board shall determine the terms and
          --------------------
conditions of any such Restricted Stock Award.  Any stock certificates issued in
respect of a Restricted Stock Award shall be registered in the name of the
Participant and, unless otherwise determined by the Board, deposited by the
Participant, together with a stock power endorsed in blank, with the Company (or
its designee).  After the expiration of the applicable restriction periods, the
Company (or such designee) shall deliver the certificates no longer subject to
such restrictions to the Participant or, if the Participant has died, to the
beneficiary designated by a Participant, in a manner determined by the Board, to
receive amounts due or exercise rights of the Participant in the event of the
Participant's death (the "Designated Beneficiary").  In the absence of an
                          ----------------------
effective designation by a Participant, Designated Beneficiary shall mean the
Participant's estate.

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6.   Other Stock-Based Awards
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     The Board shall have the right to grant other Awards based upon the Common
Stock having such terms and conditions as the Board may determine, including,
without limitation, the grant of shares based upon certain conditions, the grant
of securities convertible into Common Stock and the grant of stock appreciation
rights, phantom stock awards or stock units.

7.   General Provisions Applicable to Awards
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     a.   Transferability of Awards.  Except as the Board may otherwise
          -------------------------
determine or provide in an Award, Awards shall not be sold, assigned,
transferred, pledged or otherwise encumbered by the person to whom they are
granted, either voluntarily or by operation of law, except by will or the laws
of descent and distribution, and, during the life of the Participant, shall be
exercisable only by the Participant.  References to a Participant, to the extent
relevant in the context, shall include references to authorized transferees.
Notwithstanding the foregoing, Nonstatutory Stock Options shall also be
assignable or transferable pursuant to:  (i) a valid domestic relations order or
(ii) to:  (A) parents of the grantee, (B) issue of the parents of the grantee,
(C) parents of the grantee's spouse, (D) issue of the parents of the grantee's
spouse, (E) spouses of any such issue, (F) the legal guardian of any such issue
and/or spouses, (G) one or more trusts for the primary benefit of any such
issue, spouses and/or charitable organizations described in provision (I) below,
which trusts are either irrevocable or restricted by their terms such that they
may not be amended to provide distribution of any Stock Right to anyone other
than such issue, spouses, and/or charitable organizations, (H) the custodian for
any such issue under the Uniform Transfers to Minors Act or corresponding
statute of any jurisdiction, or (I) a charitable organization described in
Section 170(c) of the Internal Revenue Code, or any successor thereto (the
"Code") including but not limited to private foundations and supporting
organizations which have been established by the grantee during the grantee's
lifetime, and which have obtained tax exempt status under Section 501(c)(3) of
the Code; and in each such case only to the extent that such transfer is
authorized by either the Chief Executive Officer or the Chief Financial Officer
of the Company; and thereafter the transferee shall have all such rights of the
grantee, provided, however, that any provisions relating to employment or
business relationship of the grantee (such as option termination provisions)
shall be deemed to survive such transfer and the grantee's actual period of
employment or business relationship shall be the relevant measurement period for
purposes thereof.

     b.   Documentation.  Each Award under the Plan shall be evidenced by a
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written instrument in such form as the Board shall determine or as executed by
an officer of the Company pursuant to authority delegated by the Board.  Each
Award may contain terms and conditions in addition to those set forth in the
Plan provided that such terms and conditions do not contravene the provisions of
the Plan.

     c.   Board Discretion.  The terms of each type of Award need not be
          ----------------
identical, and the Board need not treat Participants uniformly.

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     d.   Termination of Status.  The Board shall determine the effect on an
          ---------------------
Award of the disability, death, retirement, authorized leave of absence or other
change in the employment or other status of a Participant and the extent to
which, and the period during which, the Participant, or the Participant's legal
representative, conservator, guardian or Designated Beneficiary, may exercise
rights under the Award.

     e.   Acquisition of the Company
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          (i)  Consequences of an Acquisition.
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               (A)  Acquisition Intended to be Accounted for  as a Pooling-of-
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Interests.  Upon the consummation of an Acquisition intended to be accounted for
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as a pooling of interests:  (x) all outstanding Awards shall remain the
obligation of the Company or be assumed by the surviving or acquiring entity,
and there shall be automatically substituted for the shares of Common Stock then
subject to such Awards the consideration payable with respect to the outstanding
shares of Common Stock in connection with the Acquisition and (y) the vesting
provisions of all then unvested Awards shall become accelerated by a period of
24 months.

               (B)  Acquisition Intended to be Accounted for under the Purchase
                    -----------------------------------------------------------
Method. Unless otherwise expressly provided in the applicable Option or Award,
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upon the occurrence of an Acquisition intended to be accounted for under the
purchase method, (x) the vesting provisions of all then unvested Awards shall
become accelerated by a period of 24 months and (y) the Board or the board of
directors of the surviving or acquiring entity (as used in this Section
7(e)(i)(B),  also the "Board"), shall, as to outstanding Awards (on the same
                       -----
basis or on different bases, as the Board shall specify), make appropriate
provision for the continuation of such Awards by the Company or the assumption
of such Awards by the surviving or acquiring entity and by substituting on an
equitable basis for the shares then subject to such Awards either (i) the
consideration payable with respect to the outstanding shares of Common Stock in
connection with the Acquisition, (ii) shares of stock of the surviving or
acquiring corporation or (iii) such other securities as the Board deems
appropriate, the fair market value of which (as determined by the Board in its
sole discretion) shall not materially differ from the fair market value of the
shares of Common Stock subject to such Awards immediately preceding the
Acquisition. In addition to or in lieu of the foregoing, with respect to
outstanding Options, the Board may, upon written notice to the affected
optionees, provide (a) that one or more Options then outstanding shall become
immediately exercisable in full; (b)  that such Options must be exercised within
a specified number of days of the date of such notice, at the end of which
period such Options shall terminate; or (c) that one or more Options then
outstanding  shall be terminated in exchange for a cash payment equal to the
excess of the fair market value (as determined by the Board in its sole
discretion) for the shares subject to such Options over the exercise price
thereof.

               (C)  Acquisition Defined. An "Acquisition" shall mean: (x) the
                    -------------------      -----------
sale of the Company by merger in which the shareholders of the Company in their
capacity as such no longer own a majority of the outstanding equity securities
of the Company (or its successor); or (y) any sale of all or substantially all
of the assets or capital stock of the Company (other than in a

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spin-off or similar transaction) or (z) any other acquisition of the business of
the Company, as determined by the Board.

          (ii)   Assumption of Options Upon Certain Events. In connection with a
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merger or consolidation of an entity with the Company or the acquisition by the
Company of property or stock of an entity, the Board may grant Awards under the
Plan in substitution for stock and stock-based awards issued by such entity or
an affiliate thereof. The substitute Awards shall be granted on such terms and
conditions as the Board considers appropriate in the circumstances.

          (iii)  Pooling-of Interests-Accounting.  If the Company proposes to
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engage in an Acquisition intended to be accounted for as a pooling-of-interests,
and in the event that the provisions of this Plan or of any Award hereunder, or
any actions of the Board taken in connection with such Acquisition, are
determined by the Company's or the acquiring company's independent public
accountants to cause such Acquisition to fail to be accounted for as a pooling-
of-interests, then such provisions or actions shall be amended or rescinded by
the Board, without the consent of any Participant, to be consistent with
pooling-of-interests accounting treatment for such Acquisition.

          (iv)   Parachute Awards. Notwithstanding the provisions of Section
                 ----------------
7(e)(i)(A), if, in connection with an Acquisition described therein, a tax under
Section 4999 of the Code would be imposed on the Participant (after taking into
account the exceptions set forth in Sections 280G(b)(4) and 280G(b)(5) of the
Code), then the number of Awards which shall become exercisable, realizable or
vested as provided in such section shall be reduced (or delayed), to the minimum
extent necessary, so that no such tax would be imposed on the Participant (the
Awards not becoming so accelerated, realizable or vested, the "Parachute
                                                               ---------
Awards"); provided, however, that if the "aggregate present value" of the
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Parachute Awards would exceed the tax that, but for this sentence, would be
imposed on the Participant under Section 4999 of the Code in connection with the
Acquisition, then the Awards shall become immediately exercisable, realizable
and vested without regard to the provisions of this sentence.  For purposes of
the preceding sentence, the "aggregate present value" of an Award shall be
                             -----------------------
calculated on an after-tax basis (other than taxes imposed by Section 4999 of
the Code) and shall be based on economic principles rather than the principles
set forth under Section 280G of the Code and the regulations promulgated
thereunder. All determinations required to be made under this Section 7(e)(iv)
shall be made by the Company.

     f.   Withholding.  Each Participant shall pay to the Company, or make
          -----------
provisions satisfactory to the Company for payment of, any taxes required by law
to be withheld in connection with Awards to such Participant no later than the
date of the event creating the tax liability.  The Board may allow Participants
to satisfy such tax obligations in whole or in part by transferring shares of
Common Stock, including shares retained from the Award creating the tax
obligation, valued at their fair market value (as determined by the Board or as
determined pursuant to the applicable option agreement).  The Company may, to
the extent permitted by law, deduct any such tax obligations from any payment of
any kind otherwise due to a Participant.

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     g.   Amendment of Awards.  The Board may amend, modify or terminate any
          -------------------
outstanding Award including, but not limited to, substituting therefor another
Award of the same or a different type, changing the date of exercise or
realization, and converting an Incentive Stock Option to a Nonstatutory Stock
Option, provided that, except as otherwise provided in Section 7(e)(iii), the
Participant's consent to such action shall be required unless the Board
determines that the action, taking into account any related action, would not
materially and adversely affect the Participant.

     h.   Conditions on Delivery of Stock.  The Company will not be obligated to
          -------------------------------
deliver any shares of Common Stock pursuant to the Plan or to remove
restrictions from shares previously delivered under the Plan until (i) all
conditions of the Award have been met or removed to the satisfaction of the
Company, (ii) in the opinion of the Company's counsel, all other legal matters
in connection with the issuance and delivery of such shares have been satisfied,
including any applicable securities laws and any applicable stock exchange or
stock market rules and regulations, and (iii) the Participant has executed and
delivered to the Company such representations or agreements as the Company may
consider appropriate to satisfy the requirements of any applicable laws, rules
or regulations.

     i.   Acceleration.  The Board may at any time provide that any Options
          ------------
shall become immediately exercisable in full or in part, that any Restricted
Stock Awards shall be free of some or all restrictions, or that any other stock-
based Awards may become exercisable in full or in part or free of some or all
restrictions or conditions, or otherwise realizable in full or in part, as the
case may be, despite the fact that the foregoing actions may (i) cause the
application of Sections 280G and 4999 of the Code if a change in control of the
Company occurs, or (ii) disqualify all or part of the Option as an Incentive
Stock Option.

8.   Miscellaneous
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     a.  Definitions.
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          (i)    "Company," for purposes of eligibility under the Plan, shall
                  --------
include any present or future subsidiary corporations of MatrixOne, Inc., as
defined in Section 424(f) of the Code (a "Subsidiary"), and any present or
                                          ----------
future parent corporation of MatrixOne, Inc., as defined in Section 424(e) of
the Code.  For purposes of Awards other than Incentive Stock Options, the term
"Company" shall include any other business venture in which the Company has a
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direct or indirect significant interest, as determined by the Board in its sole
discretion.

          (ii)   "Code" means the Internal Revenue Code of 1986, as amended, and
                  ----
any regulations promulgated thereunder.

          (iii)  "employee" for purposes of eligibility under the Plan (but not
                  --------
for purposes of Section 4(b)) shall include a person to whom an offer of
employment has been extended by the Company.

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     b.   No Right To Employment or Other Status.  No person shall have any
          --------------------------------------
claim or right to be granted an Award, and the grant of an Award shall not be
construed as giving a Participant the right to continued employment or any other
relationship with the Company.  The Company expressly reserves the right at any
time to dismiss or otherwise terminate its relationship with a Participant free
from any liability or claim under the Plan.

     c.   No Rights As Stockholder.  Subject to the provisions of the applicable
          ------------------------
Award, no Participant or Designated Beneficiary shall have any rights as a
stockholder with respect to any shares of Common Stock to be distributed with
respect to an Award until becoming the record holder thereof.

     d.   Effective Date and Term of Plan.  The Plan shall become effective on
          -------------------------------
the date on which it is adopted by the Board.  No Awards shall be granted under
the Plan after the completion of ten years from the date on which the Plan was
adopted by the Board, but Awards previously granted may extend beyond that date.

     e.   Amendment of Plan.  The Board may amend, suspend or terminate the Plan
          -----------------
or any portion thereof at any time, subject, in the case of amendments, to any
applicable statutory or regulatory requirements to obtain shareholder approval
when and if so required.

     f.   Governing Law.  The provisions of the Plan and all Awards made
          -------------
hereunder shall be governed by and interpreted in accordance with the laws of
Delaware, without regard to any applicable conflicts of law.

                                    Adopted by the Board of Directors on
                                    _______________

                                    Approved by the stockholders on
                                    _______________

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