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                                                                    EXHIBIT 10.3

                                  NETGEAR, INC.

                                 2003 STOCK PLAN

      1.    Purposes of the Plan. The purposes of this 2003 Stock Plan are:

            -     to attract and retain the best available personnel for
                  positions of substantial responsibility,

            -     to provide additional incentive to Employees, Directors and
                  Consultants, and

            -     to promote the success of the Company's business.

      Options granted under the Plan may be Incentive Stock Options or
Nonstatutory Stock Options, as determined by the Administrator at the time of
grant. Stock Purchase Rights and Stock Appreciation Rights may also be granted
under the Plan.

      2.    Definitions. As used herein, the following definitions shall apply:

            (a)   "Administrator" means the Board or any of its Committees as
                  shall be administering the Plan, in accordance with Section 4
                  of the Plan.

            (b)   "Applicable Laws" means the requirements relating to the
                  administration of stock option plans under U.S. state
                  corporate laws, U.S. federal and state securities laws, the
                  Code, any stock exchange or quotation system on which the
                  Common Stock is listed or quoted and the applicable laws of
                  any foreign country or jurisdiction where Options or Stock
                  Purchase Rights are, or will be, granted under the Plan.

            (c)   "Board" means the Board of Directors of the Company.

            (d)   "Change in Control" means the occurrence of any of the
                  following events:

                  (i) Any "person" (as such term is used in Sections 13(d) and
14(d) of the Exchange Act) becomes the "beneficial owner" (as defined in Rule
13d-3 of the Exchange Act), directly or indirectly, of securities of the Company
representing fifty percent (50%) or more of the total voting power represented
by the Company's then outstanding voting securities;

                  (ii) The consummation of the sale or disposition by the
Company of all or substantially all of the Company's assets;

                  (iii) A change in the composition of the Board occurring
within a two-year period, as a result of which fewer than a majority of the
directors are Incumbent Directors. "Incumbent Directors" means directors who
either (A) are Directors as of the effective date of the Plan, or (B) are
elected, or nominated for election, to the Board with the affirmative votes of
at least
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a majority of the Incumbent Directors at the time of such election or nomination
(but will not include an individual whose election or nomination is in
connection with an actual or threatened proxy contest relating to the election
of directors to the Company); or

                  (iv) The consummation of a merger or consolidation of the
Company with any other corporation, other than a merger or consolidation which
would result in the voting securities of the Company outstanding immediately
prior thereto continuing to represent (either by remaining outstanding or by
being converted into voting securities of the surviving entity or its parent) at
least fifty percent (50%) of the total voting power represented by the voting
securities of the Company or such surviving entity or its parent outstanding
immediately after such merger or consolidation.

            (e)   "Code" means the Internal Revenue Code of 1986, as amended.

            (f)   "Committee" means a committee of Directors appointed by the
Board in accordance with Section 4 of the Plan.

            (g)   "Common Stock" means the common stock of the Company.

            (h)   "Company" means NETGEAR, Inc., a Delaware corporation.

            (i)   "Consultant" means any natural person, including an advisor,
engaged by the Company or a Parent or Subsidiary to render services to such
entity.

            (j)   "Director" means a member of the Board.

            (k)   "Disability" means total and permanent disability as defined
in Section 22(e)(3) of the Code.

            (l)   "Employee" means any person, including Officers and Directors,
employed by the Company or any Parent or Subsidiary of the Company. A Service
Provider shall not cease to be an Employee in the case of (i) any leave of
absence approved by the Company or (ii) transfers between locations of the
Company or between the Company, its Parent, any Subsidiary, or any successor.
For purposes of Incentive Stock Options, no such leave may exceed ninety days,
unless reemployment upon expiration of such leave is guaranteed by statute or
contract. If reemployment upon expiration of a leave of absence approved by the
Company is not so guaranteed, then three (3) months following the 91st day of
such leave any Incentive Stock Option held by the Optionee shall cease to be
treated as an Incentive Stock Option and shall be treated for tax purposes as a
Nonstatutory Stock Option. Neither service as a Director nor payment of a
director's fee by the Company shall be sufficient to constitute "employment" by
the Company.

            (m)   "Exchange Act" means the Securities Exchange Act of 1934, as
amended.

            (n)   "Fair Market Value" means, as of any date, the value of Common
Stock determined as follows:

                  (i)   If the Common Stock is listed on any established stock
exchange or a national market system, including without limitation the Nasdaq
National Market or The Nasdaq

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SmallCap Market of The Nasdaq Stock Market, its Fair Market Value shall be the
closing sales price for such stock (or the closing bid, if no sales were
reported) as quoted on such exchange or system on the day of determination, as
reported in The Wall Street Journal or such other source as the Administrator
deems reliable;

                  (ii)  If the Common Stock is regularly quoted by a recognized
securities dealer but selling prices are not reported, the Fair Market Value of
a Share of Common Stock shall be the mean between the high bid and low asked
prices for the Common Stock on the day of determination, as reported in The Wall
Street Journal or such other source as the Administrator deems reliable; or

                  (iii) In the absence of an established market for the Common
Stock, the Fair Market Value shall be determined in good faith by the
Administrator.

            (o)   "Incentive Stock Option" means an Option intended to qualify
as an incentive stock option within the meaning of Section 422 of the Code and
the regulations promulgated thereunder.

            (p)   "Inside Director" means a Director who is an Employee.

            (q)   "Nonstatutory Stock Option" means an Option not intended to
qualify as an Incentive Stock Option.

            (r)   "Notice of Grant" means a written or electronic notice
evidencing certain terms and conditions of an individual Option or Stock
Purchase Right grant. The Notice of Grant is part of the Option Agreement.

            (s)   "Officer" means a person who is an officer of the Company
within the meaning of Section 16 of the Exchange Act and the rules and
regulations promulgated thereunder.

            (t)   "Option" means a stock option granted pursuant to the Plan.

            (u)   "Option Agreement" means an agreement between the Company and
an Optionee evidencing the terms and conditions of an individual Option grant.
The Option Agreement is subject to the terms and conditions of the Plan.

            (v)   "Optioned Stock" means the Common Stock subject to an Option,
Stock Purchase Right, or Stock Appreciation Right.

            (w)   "Optionee" means the holder of an outstanding Option, Stock
Purchase Right or Stock Appreciation Right granted under the Plan.

            (x)   "Outside Director" means a Director who is not an Employee.

            (y)   "Parent" means a "parent corporation," whether now or
hereafter existing, as defined in Section 424(e) of the Code.

            (z)   "Plan" means this 2003 Stock Plan.


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            (aa)  "Qualifying Board Retirement" means an Outside Director's
termination from the Board, including pursuant to the Outside Director's death
or Disability, if such termination follows (i) five full years of Board service
and attainment of age 62 or greater, or (ii) ten full years of Board service.

            (bb)  "Restricted Stock" means shares of Common Stock acquired
pursuant to a grant of Stock Purchase Rights under Section 11 of the Plan.

            (cc)  "Restricted Stock Purchase Agreement" means a written
agreement between the Company and the Optionee evidencing the terms and
restrictions applying to stock purchased under a Stock Purchase Right. The
Restricted Stock Purchase Agreement is subject to the terms and conditions of
the Plan and the Notice of Grant.

            (dd)  "Rule 16b-3" means Rule 16b-3 of the Exchange Act or any
successor to Rule 16b-3, as in effect when discretion is being exercised with
respect to the Plan.

            (ee)  "SAR Agreement" means an agreement between the Company and an
Optionee evidencing the terms and conditions of an individual SAR grant. The SAR
Agreement is subject to the terms and conditions of the Plan and the Notice of
Grant.

            (ff)  "Stock Appreciation Right" or "SAR" means an award that
pursuant to Section 12 is designated as a SAR.

            (gg)  "Section 16(b)" means Section 16(b) of the Exchange Act.

            (hh)  "Service Provider" means an Employee, Director or Consultant.

            (ii)  "Share" means a share of the Common Stock, as adjusted in
accordance with Section 15 of the Plan.

            (jj)  "Stock Purchase Right" means the right to purchase Common
Stock pursuant to Section 11 of the Plan, as evidenced by a Notice of Grant.

            (kk)   "Subsidiary" means a "subsidiary corporation", whether now or
hereafter existing, as defined in Section 424(f) of the Code.

      3.    Stock Subject to the Plan. Subject to the provisions of Section 15
of the Plan, the maximum aggregate number of Shares that may be optioned and
sold under the Plan is 750,000 Shares plus (a) any Shares which have been
reserved but not issued under the Company's 2000 Stock Option Plan (the "2000
Plan") as of the date of stockholder approval of this Plan and (b) any Shares
returned to the 2000 Plan as a result of termination of options or repurchase of
Shares issued under the 2000 Plan.


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            If an Option, Stock Purchase Right or Stock Appreciation Right
expires or becomes unexercisable without having been exercised in full, the
unpurchased Shares which were subject thereto shall become available for future
grant or sale under the Plan (unless the Plan has terminated); provided,
however, that Shares that have actually been issued under the Plan, whether upon
exercise of an Option or right, shall not be returned to the Plan and shall not
become available for future distribution under the Plan, except that if Shares
of Restricted Stock are repurchased by the Company at their original purchase
price, such Shares shall become available for future grant under the Plan.

      4.    Administration of the Plan.

            (a)   Procedure.

                  (i)   Multiple Administrative Bodies. Different Committees
with respect to different groups of Service Providers may administer the Plan.

                  (ii)  Section 162(m). To the extent that the Administrator
determines it to be desirable to qualify Options granted hereunder as
"performance-based compensation" within the meaning of Section 162(m) of the
Code, the Plan shall be administered by a Committee of two or more "outside
directors" within the meaning of Section 162(m) of the Code.

                  (iii) Rule 16b-3. To the extent desirable to qualify
transactions hereunder as exempt under Rule 16b-3, the transactions contemplated
hereunder shall be structured to satisfy the requirements for exemption under
Rule 16b-3.

                  (iv)  Other Administration. Other than as provided above, the
Plan shall be administered by (A) the Board or (B) a Committee, which committee
shall be constituted to satisfy Applicable Laws.

            (b)   Powers of the Administrator. Subject to the provisions of the
Plan, and in the case of a Committee, subject to the specific duties delegated
by the Board to such Committee, the Administrator shall have the authority, in
its discretion:

                  (i)   to determine the Fair Market Value;

                  (ii)  to select the Service Providers to whom Options, Stock
Purchase Rights and Stock Appreciation Rights may be granted hereunder;

                  (iii) to determine the number of shares of Common Stock to be
covered by each Option, Stock Purchase Right and Stock Appreciation Right
granted hereunder;

                  (iv)  to approve forms of agreement for use under the Plan;

                  (v)   to determine the terms and conditions, not inconsistent
with the terms of the Plan, of any Option, Stock Purchase Right or Stock
Appreciation Right granted hereunder. Such terms and conditions include, but are
not limited to, the exercise price, the time or times when Options, Stock
Purchase Rights and Stock Appreciation Rights may be exercised (which may be
based on performance criteria), any vesting acceleration or waiver of forfeiture
restrictions, and any


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restriction or limitation regarding any Option, Stock Purchase Right or Stock
Appreciation Right or the shares of Common Stock relating thereto, based in each
case on such factors as the Administrator, in its sole discretion, shall
determine;

                  (vi)  to construe and interpret the terms of the Plan and
awards granted pursuant to the Plan;

                  (vii) to prescribe, amend and rescind rules and regulations
relating to the Plan, including rules and regulations relating to sub-plans
established for the purpose of satisfying applicable foreign laws;

                  (viii) to modify or amend each Option, Stock Purchase Right or
Stock Appreciation Right (subject to Section 17(c) of the Plan), including the
discretionary authority to extend the post-termination exercisability period of
Options longer than is otherwise provided for in the Plan;

                  (ix)  to allow Optionees to satisfy withholding tax
obligations by electing to have the Company withhold from the Shares to be
issued upon exercise of an Option, Stock Purchase Right or Stock Appreciation
Right that number of Shares having a Fair Market Value equal to the minimum
amount required to be withheld. The Fair Market Value of the Shares to be
withheld shall be determined on the date that the amount of tax to be withheld
is to be determined. All elections by an Optionee to have Shares withheld for
this purpose shall be made in such form and under such conditions as the
Administrator may deem necessary or advisable;

                  (x)   to authorize any person to execute on behalf of the
Company any instrument required to effect the grant of an Option, Stock Purchase
Right or Stock Appreciation Right previously granted by the Administrator;

                  (xi)  to make all other determinations deemed necessary or
advisable for administering the Plan.

            (c)   Effect of Administrator's Decision. The Administrator's
decisions, determinations and interpretations shall be final and binding on all
Optionees and any other holders of Options, Stock Purchase Rights or Stock
Appreciation Rights.

      5.    Eligibility. Nonstatutory Stock Options, Stock Purchase Rights and
Stock Appreciation Rights may be granted to Service Providers. Incentive Stock
Options may be granted only to Employees.

      6.    Limitations.

            (a)   Each Option shall be designated in the Option Agreement as
either an Incentive Stock Option or a Nonstatutory Stock Option. However,
notwithstanding such designation, to the extent that the aggregate Fair Market
Value of the Shares with respect to which Incentive Stock Options are
exercisable for the first time by the Optionee during any calendar year (under
all plans of the Company and any Parent or Subsidiary) exceeds $100,000, such
Options shall be treated as Nonstatutory Stock Options. For purposes of this
Section 6(a), Incentive Stock Options shall be


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taken into account in the order in which they were granted. The Fair Market
Value of the Shares shall be determined as of the time the Option with respect
to such Shares is granted.

            (b)   Neither the Plan nor any Option, Stock Purchase Right or Stock
Appreciation Right shall confer upon an Optionee any right with respect to
continuing the Optionee's relationship as a Service Provider with the Company,
nor shall they interfere in any way with the Optionee's right or the Company's
right to terminate such relationship at any time, with or without cause.

            (c)   The following limitations shall apply to grants of Options:

                  (i)   No Service Provider shall be granted, in any fiscal year
of the Company, Options to purchase more than 750,000 Shares.

                  (ii)  In connection with his or her initial service, a Service
Provider may be granted Options to purchase up to an additional 750,000 Shares,
which shall not count against the limit set forth in subsection (i) above.

                  (iii) The foregoing limitations shall be adjusted
proportionately in connection with any change in the Company's capitalization as
described in Section 15.

                  (iv)  If an Option is cancelled in the same fiscal year of the
Company in which it was granted (other than in connection with a transaction
described in Section 15), the cancelled Option will be counted against the
limits set forth in subsections (i) and (ii) above. For this purpose, if the
exercise price of an Option is reduced, the transaction will be treated as a
cancellation of the Option and the grant of a new Option.

      7.    Term of Plan. Subject to Section 21 of the Plan, the Plan shall
become effective upon its adoption by the Board. It shall continue in effect for
a term of ten (10) years unless terminated earlier under Section 17 of the Plan.

      8.    Term of Option. The term of each Option shall be stated in the
Option Agreement. In the case of an Incentive Stock Option, the term shall be
ten (10) years from the date of grant or such shorter term as may be provided in
the Option Agreement. Moreover, in the case of an Incentive Stock Option granted
to an Optionee who, at the time the Incentive Stock Option is granted, owns
stock representing more than ten percent (10%) of the total combined voting
power of all classes of stock of the Company or any Parent or Subsidiary, the
term of the Incentive Stock Option shall be five (5) years from the date of
grant or such shorter term as may be provided in the Option Agreement.

      9.    Option Exercise Price and Consideration.

            (a)   Exercise Price. The per share exercise price for the Shares to
be issued pursuant to exercise of an Option shall be determined by the
Administrator, subject to the following:

                  (i)   In the case of an Incentive Stock Option

                        (1)   granted to an Employee who, at the time the
Incentive Stock Option is granted, owns stock representing more than ten percent
(10%) of the voting power of all


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classes of stock of the Company or any Parent or Subsidiary, the per Share
exercise price shall be no less than 110% of the Fair Market Value per Share on
the date of grant.

                        (2)   granted to any Employee other than an Employee
described in paragraph (A) immediately above, the per Share exercise price shall
be no less than 100% of the Fair Market Value per Share on the date of grant.

                  (ii)  In the case of a Nonstatutory Stock Option, the per
Share exercise price shall be determined by the Administrator. In the case of a
Nonstatutory Stock Option intended to qualify as "performance-based
compensation" within the meaning of Section 162(m) of the Code, the per Share
exercise price shall be no less than 100% of the Fair Market Value per Share on
the date of grant.

                  (iii) Notwithstanding the foregoing, Options may be granted
with a per Share exercise price of less than 100% of the Fair Market Value per
Share on the date of grant pursuant to a merger or other corporate transaction.

            (b)   Waiting Period and Exercise Dates. At the time an Option is
granted, the Administrator shall fix the period within which the Option may be
exercised and shall determine any conditions that must be satisfied before the
Option may be exercised.

            (c)   Form of Consideration. The Administrator shall determine the
acceptable form of consideration for exercising an Option, including the method
of payment. In the case of an Incentive Stock Option, the Administrator shall
determine the acceptable form of consideration at the time of grant. Such
consideration may consist, subject to Applicable Laws, entirely of:

                  (i)   cash;

                  (ii)  check;

                  (iii) promissory note;

                  (iv)  other Shares which, in the case of Shares acquired
directly or indirectly from the Company, (A) have been owned by the Optionee for
more than six (6) months on the date of surrender, and (B) have a Fair Market
Value on the date of surrender equal to the aggregate exercise price of the
Shares as to which said Option shall be exercised;

                  (v)   consideration received by the Company under a cashless
exercise program implemented by the Company in connection with the Plan;

                  (vi)  a reduction in the amount of any Company liability to
the Optionee, including any liability attributable to the Optionee's
participation in any Company-sponsored deferred compensation program or
arrangement;

                  (vii) any combination of the foregoing methods of payment; or

                  (viii) such other consideration and method of payment for the
issuance of Shares to the extent permitted by Applicable Laws.


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      10.   Exercise of Option.

            (a)   Procedure for Exercise; Rights as a Stockholder. Any Option
granted hereunder shall be exercisable according to the terms of the Plan and at
such times and under such conditions as determined by the Administrator and set
forth in the Option Agreement. Unless the Administrator provides otherwise,
vesting of Options granted hereunder shall be suspended during any unpaid leave
of absence. An Option may not be exercised for a fraction of a Share.

                  An Option shall be deemed exercised when the Company receives:
(i) written or electronic notice of exercise (in accordance with the Option
Agreement) from the person entitled to exercise the Option, and (ii) full
payment for the Shares with respect to which the Option is exercised. Full
payment may consist of any consideration and method of payment authorized by the
Administrator and permitted by the Option Agreement and the Plan. Shares issued
upon exercise of an Option shall be issued in the name of the Optionee or, if
requested by the Optionee, in the name of the Optionee and his or her spouse.
Until the Shares are issued (as evidenced by the appropriate entry on the books
of the Company or of a duly authorized transfer agent of the Company), no right
to vote or receive dividends or any other rights as a stockholder shall exist
with respect to the Optioned Stock, notwithstanding the exercise of the Option.
The Company shall issue (or cause to be issued) such Shares promptly after the
Option is exercised. No adjustment will be made for a dividend or other right
for which the record date is prior to the date the Shares are issued, except as
provided in Section 15 of the Plan.

                  Exercising an Option in any manner shall decrease the number
of Shares thereafter available, both for purposes of the Plan and for sale under
the Option, by the number of Shares as to which the Option is exercised.

            (b)   Termination of Relationship as a Service Provider. If an
Optionee ceases to be a Service Provider, other than upon the Optionee's death
or Disability, the Optionee may exercise his or her Option within such period of
time as is specified in the Option Agreement to the extent that the Option is
vested on the date of termination (but in no event later than the expiration of
the term of such Option as set forth in the Option Agreement). In the absence of
a specified time in the Option Agreement, the Option shall remain exercisable
for three (3) months following the Optionee's termination. If, on the date of
termination, the Optionee is not vested as to his or her entire Option, the
Shares covered by the unvested portion of the Option shall revert to the Plan.
If, after termination, the Optionee does not exercise his or her Option within
the time specified by the Administrator, the Option shall terminate, and the
Shares covered by such Option shall revert to the Plan.

            (c)   Disability of Optionee. If an Optionee ceases to be a Service
Provider as a result of the Optionee's Disability, the Optionee may exercise his
or her Option within such period of time as is specified in the Option Agreement
to the extent the Option is vested on the date of termination (but in no event
later than the expiration of the term of such Option as set forth in the Option
Agreement). In the absence of a specified time in the Option Agreement, the
Option shall remain exercisable for twelve (12) months following the Optionee's
termination. If, on the date of termination, the Optionee is not vested as to
his or her entire Option, the Shares covered by the unvested portion of the
Option shall revert to the Plan. If, after termination, the Optionee does not
exercise


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his or her Option within the time specified herein, the Option shall terminate,
and the Shares covered by such Option shall revert to the Plan.

            (d)   Death of Optionee. If an Optionee dies while a Service
Provider, the Option may be exercised following the Optionee's death within such
period of time as is specified in the Option Agreement to the extent that the
Option is vested on the date of death (but in no event may the option be
exercised later than the expiration of the term of such Option as set forth in
the Option Agreement), by the Optionee's designated beneficiary, provided such
beneficiary has been designated prior to Optionee's death in a form acceptable
to the Administrator. If no such beneficiary has been designated by the
Optionee, then such Option may be exercised by the personal representative of
the Optionee's estate or by the person(s) to whom the Option is transferred
pursuant to the Optionee's will or in accordance with the laws of descent and
distribution. In the absence of a specified time in the Option Agreement, the
Option shall remain exercisable for twelve (12) months following Optionee's
death. If, at the time of death, Optionee is not vested as to his or her entire
Option, the Shares covered by the unvested portion of the Option shall
immediately revert to the Plan. If the Option is not so exercised within the
time specified herein, the Option shall terminate, and the Shares covered by
such Option shall revert to the Plan. Notwithstanding anything in the Plan to
the contrary, an Optionee's service shall be deemed to have terminated as a
result of Optionee's death if Optionee dies at any time prior to the expiration
of the time period specified in the Option Agreement or, if no time period is
specified in the Option Agreement, at any time prior to the expiration of three
(3) months following the date on which Optionee ceased to be a Service Provider.

      11.   Stock Purchase Rights.

            (a)   Rights to Purchase. Stock Purchase Rights may be issued either
alone, in addition to, or in tandem with other awards granted under the Plan
and/or cash awards made outside of the Plan. All Stock Purchase Rights must have
a purchase price of not less than the Fair Market Value of the shares. After the
Administrator determines that it will offer Stock Purchase Rights under the
Plan, it shall advise the offeree in writing or electronically, by means of a
Notice of Grant, of the terms, conditions and restrictions related to the offer,
including the number of Shares that the offeree shall be entitled to purchase,
the price to be paid, and the time within which the offeree must accept such
offer. The offer shall be accepted by execution of a Restricted Stock Purchase
Agreement in the form determined by the Administrator.

            (b)   Repurchase Option. Unless the Administrator determines
otherwise, the Restricted Stock Purchase Agreement shall grant the Company a
repurchase option exercisable upon the voluntary or involuntary termination of
the purchaser's service with the Company for any reason (including death or
Disability). The purchase price for Shares repurchased pursuant to the
Restricted Stock Purchase Agreement shall be the original price paid by the
purchaser and may be paid by cancellation of any indebtedness of the purchaser
to the Company. The repurchase option shall lapse at a rate determined by the
Administrator.

            (c)   Other Provisions. The Restricted Stock Purchase Agreement
shall contain such other terms, provisions and conditions not inconsistent with
the Plan as may be determined by the Administrator in its sole discretion.


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<PAGE>
            (d)   Rights as a Stockholder. Once the Stock Purchase Right is
exercised, the purchaser shall have the rights equivalent to those of a
stockholder, and shall be a stockholder when his or her purchase is entered upon
the records of the duly authorized transfer agent of the Company. No adjustment
will be made for a dividend or other right for which the record date is prior to
the date the Stock Purchase Right is exercised, except as provided in Section 15
of the Plan.

      12.   Stock Appreciation Rights. Each SAR grant shall be evidenced by a
SAR Agreement that shall specify the terms of the SAR, the conditions of
exercise, the expiration date, and such other terms and conditions as the
Administrator, in its sole discretion, shall determine. Notwithstanding the
foregoing, the rules of Sections 9(c) and 10 of the Plan also shall apply to
SARs. Upon exercise of a SAR, an Optionee shall be entitled to receive a payment
from the Company (at the discretion of the Administrator, in cash, in Shares of
equivalent value, or in some combination thereof) in an amount determined by
multiplying (i) the difference between the Fair Market Value of a Share on the
date of exercise over the exercise price, by (ii) the number of Shares with
respect to which the SAR is exercised.

      13.   Transferability of Options, Stock Purchase Rights and Stock
Appreciation Rights. Unless determined otherwise by the Administrator, an
Option, Stock Purchase Right or Stock Appreciation Right may not be sold,
pledged, assigned, hypothecated, transferred, or disposed of in any manner other
than by will or by the laws of descent or distribution and may be exercised,
during the lifetime of the Optionee, only by the Optionee. If the Administrator
makes an Option, Stock Purchase Right or Stock Appreciation Right transferable,
such Option, Stock Purchase Right or Stock Appreciation Right shall contain such
additional terms and conditions as the Administrator deems appropriate.

      14.   Formula Option Grants to Outside Directors. All grants of Options to
Outside Directors pursuant to this Section shall be automatic and
nondiscretionary and shall be made strictly in accordance with the following
provisions:

           (a)   All Options granted pursuant to this Section shall be
Nonstatutory Stock Options and, except as otherwise provided herein, shall be
subject to the other terms and conditions of the Plan.

           (b)   No person shall have any discretion to select which Outside
Directors shall be granted Options under this Section or to determine the number
of Shares to be covered by such Options.

           (c)   Each person who first becomes an Outside Director following the
effective date of this Plan, as determined in accordance with Section 7 hereof,
shall be automatically granted an Option to purchase 25,000 Shares (the "First
Option") or the date on which such person first becomes an Outside Director,
whether through election by the stockholders of the Company or appointment by
the Board to fill a vacancy; provided, however, that an Inside Director who
ceases to be an Inside Director but who remains a Director shall not receive a
First Option.

            (d)  Each Outside Director shall be automatically granted an Option
to purchase 15,000 Shares (an "Annual Option") on each date of the annual
meeting of the stockholders


                                                                            -11-
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of the Company, if as of such date, he or she shall have served on the Board for
at least the preceding six (6) months.

            (e)   Notwithstanding the provisions of subsections (c) and (d)
hereof, any exercise of an Option granted before the Company has obtained
stockholder approval of the Plan in accordance with Section 21 hereof shall be
conditioned upon obtaining such stockholder approval of the Plan in accordance
with Section 21 hereof.

            (f)   The terms of each First Option granted pursuant to this
Section shall be as follows:

                  (i)   the term of the First Option shall be ten (10) years.

                  (ii)  the exercise price per Share shall be 100% of the Fair
Market Value per Share on the date of grant of the First Option.

            (g)   subject to Section 15 hereof, the First Option shall vest and
become exercisable as to 1/3rd of the Shares subject to the First Option on each
anniversary of its date of grant, so as to be 100% vested on the third
anniversary of the date of grant, provided that the Optionee continues to serve
as a Director on such dates.

            (h)   The terms of each Annual Option granted pursuant to this
Section shall be as follows:

                  (i)   the term of the Annual Option shall be ten (10) years.

                  (ii)  the exercise price per Share shall be 100% of the Fair
Market Value per Share on the date of grant of the Annual Option.

                  (iii) subject to Section 15 hereof, the Annual Option shall
vest and become exercisable as to 100% of the Shares covered by the Annual
Option on the date of the next annual meeting of the stockholders of the
Company, provided that the Optionee continues to serve as a Director through
such date.

            (i)   The First Option and Annual Option shall remain exercisable,
to the extent vested on the date of termination of Board service, for one year
following such termination date (but in no event longer than the original term
of the Option); provided, however, that in the event of a Qualifying Board
Retirement, such Options shall remain exercisable, to the extent vested on the
date of termination of Board service, for five years following such termination
(but in no event longer than the original term of the Option).

      15.   Adjustments Upon Changes in Capitalization, Dissolution or
Liquidation or Change in Control.

            (a)   Changes in Capitalization. Subject to any required action by
the stockholders of the Company, the number of shares of Common Stock that have
been authorized for issuance under the Plan but as to which no Options, Stock
Purchase Rights or Stock Appreciation Rights have yet been granted or which have
been returned to the Plan upon cancellation or expiration of an


                                                                            -12-
<PAGE>
Option, Stock Purchase Right or Stock Appreciation Right, the number of Shares
that may be added annually to the Plan pursuant to Section 3(i), the number of
shares which may be granted pursuant to the automatic grant provisions of
Section 14 and the number of shares of Common Stock as well as the price per
share of Common Stock covered by each such outstanding Option, Stock Purchase
Right or Stock Appreciation Right, shall be proportionately adjusted for any
increase or decrease in the number of issued shares of Common Stock resulting
from a stock split, reverse stock split, stock dividend, combination or
reclassification of the Common Stock, or any other increase or decrease in the
number of issued shares of Common Stock effected without receipt of
consideration by the Company; provided, however, that conversion of any
convertible securities of the Company shall not be deemed to have been "effected
without receipt of consideration." Such adjustment shall be made by the Board,
whose determination in that respect shall be final, binding and conclusive.
Except as expressly provided herein, no issuance by the Company of shares of
stock of any class, or securities convertible into shares of stock of any class,
shall affect, and no adjustment by reason thereof shall be made with respect to,
the number or price of shares of Common Stock subject to an Option, Stock
Purchase Right or Stock Appreciation Right.

            (b)   Dissolution or Liquidation. In the event of the proposed
dissolution or liquidation of the Company, the Administrator shall notify each
Optionee as soon as practicable prior to the effective date of such proposed
transaction. The Administrator in its discretion may provide for an Optionee to
have the right to exercise his or her Option or Stock Appreciation Right until
ten (10) days prior to such transaction as to all of the Optioned Stock covered
thereby, including Shares as to which the Option or Stock Appreciation Right
would not otherwise be exercisable. In addition, the Administrator may provide
that any Company repurchase option applicable to any Shares purchased upon
exercise of an Option or Stock Purchase Right shall lapse as to all such Shares,
provided the proposed dissolution or liquidation takes place at the time and in
the manner contemplated. To the extent it has not been previously exercised, an
Option, Stock Purchase Right or Stock Appreciation Right will terminate
immediately prior to the consummation of such proposed action.

            (c)   Change in Control. In the event of a Change in Control, each
outstanding Option, Stock Purchase Right (or restricted stock issued pursuant to
a Stock Purchase Right) and Stock Appreciation Right shall be assumed or an
equivalent option or right substituted by the successor corporation or a Parent
or Subsidiary of the successor corporation. With respect to Options or SARs
granted to an Outside Director under the Plan, such Options or SARs shall vest
in full upon a Change in Control.

                  In the event that the successor corporation refuses to assume
or substitute for the Option, Stock Purchase Right (or restricted stock issued
pursuant to a Stock Purchase Right) or Stock Appreciation Right, the Optionee
shall fully vest in and have the right to exercise the Option, Stock Purchase
Right (or restricted stock issued pursuant to a Stock Purchase Right) or Stock
Appreciation Right as to all of the Optioned Stock, including Shares as to which
it would not otherwise be vested or exercisable. If an Option, Stock Purchase
Right (or restricted stock issued pursuant to a Stock Purchase Right) or Stock
Appreciation Right becomes fully vested and exercisable in lieu of assumption or
substitution in the event of a Change in Control, the Administrator shall notify
the Optionee in writing or electronically that the Option, Stock Purchase Right
or Stock Appreciation Right shall be fully vested and exercisable for a period
of fifteen (15) days from the date of such notice, and the Option, Stock
Purchase Right or Stock Appreciation Right


                                                                            -13-
<PAGE>
shall terminate upon the expiration of such period, or with respect to
restricted stock issued pursuant to a Stock Purchase Right, that such restricted
stock shall become 100% vested immediately prior to the Change in Control.

                  For the purposes of this subsection (c), the Option, Stock
Purchase Right (or restricted stock issued pursuant to a Stock Purchase Right)
or Stock Appreciation Right shall be considered assumed if, following the Change
in Control, the option or right confers the right to purchase or receive, for
each Share of Optioned Stock subject to the Option, Stock Purchase Right (or
restricted stock issued pursuant to a Stock Purchase Right) or Stock
Appreciation Right immediately prior to the Change in Control, the consideration
(whether stock, cash, or other securities or property) or, in the case of a
Stock Appreciation Right upon the exercise of which the Administrator determines
to pay cash, the fair market value of the consideration, received in the Change
in Control by holders of Common Stock for each Share held on the effective date
of the transaction (and if holders were offered a choice of consideration, the
type of consideration chosen by the holders of a majority of the outstanding
Shares); provided, however, that if such consideration received in the Change in
Control is not solely common stock of the successor corporation or its Parent,
the Administrator may, with the consent of the successor corporation, provide
for the consideration to be received upon the exercise of the Option, Stock
Purchase Right (or restricted stock issued pursuant to a Stock Purchase Right)
or Stock Appreciation Right, for each Share of Optioned Stock subject to the
Option, Stock Purchase Right (or restricted stock issued pursuant to a Stock
Purchase Right) or Stock Appreciation Right, to be solely common stock of the
successor corporation or its Parent equal in fair market value to the per share
consideration received by holders of Common Stock in the Change in Control.

      16.   Date of Grant. The date of grant of an Option, Stock Purchase Right
or Stock Appreciation Right shall be, for all purposes, the date on which the
Administrator makes the determination granting such Option, Stock Purchase Right
or Stock Appreciation Right, or such other later date as is determined by the
Administrator. Notice of the determination shall be provided to each Optionee
within a reasonable time after the date of such grant.

      17.   Amendment and Termination of the Plan.

            (a)   Amendment and Termination. The Board may at any time amend,
alter, suspend or terminate the Plan.

            (b)   Stockholder Approval. The Company shall obtain stockholder
approval of any Plan amendment to the extent necessary and desirable to comply
with Applicable Laws. The Company shall not effect an option or SAR repricing or
underwater option or SAR exchange with respect to Options or SARs granted under
the Plan without first obtaining stockholder approval thereof.

            (c)   Effect of Amendment or Termination. No amendment, alteration,
suspension or termination of the Plan shall impair the rights of any Optionee,
unless mutually agreed otherwise between the Optionee and the Administrator,
which agreement must be in writing and signed by the Optionee and the Company.
Termination of the Plan shall not affect the Administrator's ability to exercise
the powers granted to it hereunder with respect to Options, Stock Purchase
Rights and Stock Appreciation Rights granted under the Plan prior to the date of
such termination.


                                                                            -14-
<PAGE>
      18.   Conditions Upon Issuance of Shares.

            (a)   Legal Compliance. Shares shall not be issued pursuant to the
exercise of an Option, Stock Purchase Right or Stock Appreciation Right unless
the exercise of such Option, Stock Purchase Right or Stock Appreciation Right
and the issuance and delivery of such Shares shall comply with Applicable Laws
and shall be further subject to the approval of counsel for the Company with
respect to such compliance.

            (b)   Investment Representations. As a condition to the exercise of
an Option, Stock Purchase Right or Stock Appreciation Right, the Company may
require the person exercising such Option, Stock Purchase Right or Stock
Appreciation Right to represent and warrant at the time of any such exercise
that the Shares are being purchased only for investment and without any present
intention to sell or distribute such Shares if, in the opinion of counsel for
the Company, such a representation is required.

      19.   Inability to Obtain Authority. The inability of the Company to
obtain authority from any regulatory body having jurisdiction, which authority
is deemed by the Company's counsel to be necessary to the lawful issuance and
sale of any Shares hereunder, shall relieve the Company of any liability in
respect of the failure to issue or sell such Shares as to which such requisite
authority shall not have been obtained.

      20.   Reservation of Shares. The Company, during the term of this Plan,
will at all times reserve and keep available such number of Shares as shall be
sufficient to satisfy the requirements of the Plan.

      21.   Stockholder Approval. The Plan shall be subject to approval by the
stockholders of the Company within twelve (12) months after the date the Plan is
adopted. Such stockholder approval shall be obtained in the manner and to the
degree required under Applicable Laws.


                                                                            -15-
<PAGE>
                                  NETGEAR, INC.

                                 2003 STOCK PLAN

                             STOCK OPTION AGREEMENT

Unless otherwise defined herein, the terms defined in the 2003 Stock Plan shall
have the same defined meanings in this Stock Option Agreement.

I.    NOTICE OF STOCK OPTION GRANT

      [OPTIONEE'S NAME AND ADDRESS]

      You have been granted an option to purchase Common Stock of the Company,
subject to the terms and conditions of the Plan and this Option Agreement, as
follows:

Grant Number
                                        ---------------------------------------
Date of Grant
                                        ---------------------------------------
Vesting Commencement Date
                                        ---------------------------------------
Exercise Price per Share               $
                                        ---------------------------------------
Total Number of Shares Granted
                                        ---------------------------------------
Total Exercise Price                   $
                                        ---------------------------------------
Type of Option:                              Incentive Stock Option
                                        -----
                                             Nonstatutory Stock Option
                                        -----

      Term/Expiration Date:
                                        ---------------------------------------

      Vesting Schedule:

      This Option shall be exercisable, in whole or in part, in accordance with
the following schedule:

      [25% OF THE SHARES SUBJECT TO THE OPTION SHALL VEST TWELVE MONTHS AFTER
THE VESTING COMMENCEMENT DATE, AND 1/48 OF THE SHARES SUBJECT TO THE OPTION
SHALL VEST EACH MONTH THEREAFTER, SUBJECT TO THE OPTIONEE CONTINUING TO BE A
SERVICE PROVIDER ON SUCH DATES].
<PAGE>
      Termination Period:

      This Option may be exercised for [THREE MONTHS] after Optionee ceases to
be a Service Provider. Upon the death or Disability of the Optionee, this Option
may be exercised for [TWELVE MONTHS] after Optionee ceases to be a Service
Provider. In no event shall this Option be exercised later than the
Term/Expiration Date as provided above.

II.   AGREEMENT

      A.    Grant of Option.

            The Plan Administrator of the Company hereby grants to the Optionee
named in the Notice of Grant attached as Part I of this Agreement (the
"Optionee") an option (the "Option") to purchase the number of Shares, as set
forth in the Notice of Grant, at the exercise price per share set forth in the
Notice of Grant (the "Exercise Price"), subject to the terms and conditions of
the Plan, which is incorporated herein by reference. Subject to Section 16(c) of
the Plan, in the event of a conflict between the terms and conditions of the
Plan and the terms and conditions of this Option Agreement, the terms and
conditions of the Plan shall prevail.

            If designated in the Notice of Grant as an Incentive Stock Option
("ISO"), this Option is intended to qualify as an Incentive Stock Option under
Section 422 of the Code. However, if this Option is intended to be an Incentive
Stock Option, to the extent that it exceeds the $100,000 rule of Code Section
422(d) it shall be treated as a Nonstatutory Stock Option ("NSO").

      B.    Exercise of Option.

            (a)   Right to Exercise. This Option is exercisable during its term
in accordance with the Vesting Schedule set out in the Notice of Grant and the
applicable provisions of the Plan and this Option Agreement.

            (b)   Method of Exercise. This Option is exercisable by delivery of
an exercise notice, in the form attached as Exhibit A (the "Exercise Notice"),
which shall state the election to exercise the Option, the number of Shares in
respect of which the Option is being exercised (the "Exercised Shares"), and
such other representations and agreements as may be required by the Company
pursuant to the provisions of the Plan. The Exercise Notice shall be completed
by the Optionee and delivered to the Stock Administrator of the Company. The
Exercise Notice shall be accompanied by payment of the aggregate Exercise Price
as to all Exercised Shares. This Option shall be deemed to be exercised upon
receipt by the Company of such fully executed Exercise Notice accompanied by
such aggregate Exercise Price.

            No Shares shall be issued pursuant to the exercise of this Option
unless such issuance and exercise complies with Applicable Laws. Assuming such
compliance, for income tax purposes the Exercised Shares shall be considered
transferred to the Optionee on the date the Option is exercised with respect to
such Exercised Shares.


                                      -2-
<PAGE>
      C.    Method of Payment.

            Payment of the aggregate Exercise Price shall be by any of the
following, or a combination thereof, at the election of the Optionee:

            1.    cash; or

            2.    check; or

            3.    consideration received by the Company under a formal cashless
exercise program implemented by the Company in connection with the Plan; or

            4.    surrender of other Shares which (i) in the case of Shares
acquired either directly or indirectly from the Company, have been owned by the
Optionee for more than six (6) months on the date of surrender, and (ii) have a
Fair Market Value on the date of surrender equal to the aggregate Exercise Price
of the Exercised Shares.

      D.    Non-Transferability of Option.

            This Option may not be transferred in any manner otherwise than by
will or by the laws of descent or distribution and may be exercised during the
lifetime of Optionee only by the Optionee. The terms of the Plan and this Option
Agreement shall be binding upon the executors, administrators, heirs, successors
and assigns of the Optionee.

      E.    Term of Option.

            This Option may be exercised only within the term set out in the
Notice of Grant, and may be exercised during such term only in accordance with
the Plan and the terms of this Option Agreement.

      F.    Tax Obligations.

            (a)   Withholding Taxes. Optionee agrees to make appropriate
arrangements with the Company (or the Parent or Subsidiary employing or
retaining Optionee) for the satisfaction of all Federal, state, local and
foreign income and employment tax withholding requirements applicable to the
Option exercise. Optionee acknowledges and agrees that the Company may refuse to
honor the exercise and refuse to deliver Shares if such withholding amounts are
not delivered at the time of exercise.

            (b)   Notice of Disqualifying Disposition of ISO Shares. If the
Option granted to Optionee herein is an ISO, and if Optionee sells or otherwise
disposes of any of the Shares acquired pursuant to the ISO on or before the
later of (1) the date two years after the Date of Grant, or (2) the date one
year after the date of exercise, the Optionee shall immediately notify the
Company in writing of such disposition. Optionee agrees that Optionee may be
subject to income tax withholding by the Company on the compensation income
recognized by the Optionee.

      G.    Entire Agreement; Governing Law.


                                      -3-
<PAGE>
            The Plan is incorporated herein by reference. The Plan and this
Option Agreement constitute the entire agreement of the parties with respect to
the subject matter hereof and supersede in their entirety all prior undertakings
and agreements of the Company and Optionee with respect to the subject matter
hereof, and may not be modified adversely to the Optionee's interest except by
means of a writing signed by the Company and Optionee. This agreement is
governed by the internal substantive laws, but not the choice of law rules, of
California.

      H.    NO GUARANTEE OF CONTINUED SERVICE.

            OPTIONEE ACKNOWLEDGES AND AGREES THAT THE VESTING OF SHARES PURSUANT
TO THE VESTING SCHEDULE HEREOF IS EARNED ONLY BY CONTINUING AS A SERVICE
PROVIDER AT THE WILL OF THE COMPANY (AND NOT THROUGH THE ACT OF BEING HIRED,
BEING GRANTED AN OPTION OR PURCHASING SHARES HEREUNDER). OPTIONEE FURTHER
ACKNOWLEDGES AND AGREES THAT THIS AGREEMENT, THE TRANSACTIONS CONTEMPLATED
HEREUNDER AND THE VESTING SCHEDULE SET FORTH HEREIN DO NOT CONSTITUTE AN EXPRESS
OR IMPLIED PROMISE OF CONTINUED ENGAGEMENT AS A SERVICE PROVIDER FOR THE VESTING
PERIOD, FOR ANY PERIOD, OR AT ALL, AND SHALL NOT INTERFERE WITH OPTIONEE'S RIGHT
OR THE COMPANY'S RIGHT TO TERMINATE OPTIONEE'S RELATIONSHIP AS A SERVICE
PROVIDER AT ANY TIME, WITH OR WITHOUT CAUSE.

            By your signature and the signature of the Company's representative
below, you and the Company agree that this Option is granted under and governed
by the terms and conditions of the Plan and this Option Agreement. Optionee has
reviewed the Plan and this Option Agreement in their entirety, has had an
opportunity to obtain the advice of counsel prior to executing this Option
Agreement and fully understands all provisions of the Plan and Option Agreement.
Optionee hereby agrees to accept as binding, conclusive and final all decisions
or interpretations of the Administrator upon any questions relating to the Plan
and Option Agreement. Optionee further agrees to notify the Company upon any
change in the residence address indicated below.

OPTIONEE:                               NETGEAR, INC.


-------------------------------------         ----------------------------------
Signature                               By


-------------------------------------         ----------------------------------
Print Name                              Title


-------------------------------------
Residence Address


-------------------------------------


                                      -4-
<PAGE>
                                    EXHIBIT A

                                  NETGEAR, INC.

                                 2003 STOCK PLAN

                                 EXERCISE NOTICE

NETGEAR, Inc.
4500 Great America Parkway
Santa Clara, CA 95054

Attention:  Stock Administrator

            1.    Exercise of Option. Effective as of today, ---------------,

-------, the undersigned ("Purchaser") hereby elects to purchase          shares
                                                                ---------
(the "Shares") of the Common Stock of NETGEAR, Inc. (the "Company") under and
pursuant to the 2003 Stock Plan (the "Plan") and the Stock Option Agreement
dated,       (the "Option Agreement"). Subject to adjustment in accordance with
      ------
Section 14 of the Plan, the purchase price for the Shares shall be $       , as
                                                                    -------
required by the Option Agreement.

            2.    Delivery of Payment. Purchaser herewith delivers to the
Company the full purchase price for the Shares.

            3.    Representations of Purchaser. Purchaser acknowledges that
Purchaser has received, read and understood the Plan and the Option Agreement
and agrees to abide by and be bound by their terms and conditions.

            4.    Rights as Shareholder. Until the issuance (as evidenced by the
appropriate entry on the books of the Company or of a duly authorized transfer
agent of the Company) of the Shares, no right to vote or receive dividends or
any other rights as a shareholder shall exist with respect to the Optioned
Stock, notwithstanding the exercise of the Option. The Shares so acquired shall
be issued to the Optionee as soon as practicable after exercise of the Option.
No adjustment will be made for a dividend or other right for which the record
date is prior to the date of issuance, except as provided in Section 14 of the
Plan.

            5.    Tax Consultation. Purchaser understands that Purchaser may
suffer adverse tax consequences as a result of Purchaser's purchase or
disposition of the Shares. Purchaser represents that Purchaser has consulted
with any tax consultants Purchaser deems advisable in connection with the
purchase or disposition of the Shares and that Purchaser is not relying on the
Company for any tax advice.
<PAGE>
            6.    Entire Agreement; Governing Law. The Plan and Option Agreement
are incorporated herein by reference. This Agreement, the Plan and the Option
Agreement constitute the entire agreement of the parties with respect to the
subject matter hereof and supersede in their entirety all prior undertakings and
agreements of the Company and Purchaser with respect to the subject matter
hereof, and may not be modified adversely to the Purchaser's interest except by
means of a writing signed by the Company and Purchaser. This agreement is
governed by the internal substantive laws, but not the choice of law rules, of
California.

Submitted by:                              Accepted by:

PURCHASER:                                 NETGEAR, INC.


----------------------------------         ------------------------------------
Signature                                  By

----------------------------------         ------------------------------------
Print Name                                 Its

Address:                                   Address:

                                           4500 Great America Parkway
----------------------------------
                                           Santa Clara, CA  95054
----------------------------------

                                           ----------------------------------
                                           Date Received


                                      -2-