Exhibit
10.2 
	 






		BORLAND
SOFTWARE CORPORATION 

2003 SUPPLEMENTAL STOCK OPTION PLAN 
	 






		ARTICLE
ONE 

GENERAL PROVISIONS 
	 







		           I.       
PURPOSE OF THE PLAN   
	 






		                      This
2003 Supplemental Stock Option Plan is intended to promote the interests of Borland
Software Corporation, a Delaware corporation, by providing eligible persons in the
Corporation’s service with the opportunity to acquire a proprietary interest, or
otherwise increase their proprietary interest, in the Corporation as an incentive for
them to remain in such service. The Plan is intended to be exempt from shareholder
approval requirements of Rule 4350 of the Quantitative Listing Requirements of the Nasdaq
National Market as provided under the “inducement grant exception” of Rule
4350(i)(1)(A)(iv).    
	 






		                      Capitalized
terms shall have the meanings assigned to such terms in the attached Appendix. Should any
relevant date under the Plan fall on a date on which there is no trading on the
securities exchange or Nasdaq National Market (as applicable) on which the Common Stock
is at that time traded, then the relevant date for purposes of the Plan shall be the
immediately preceding trading date.  
	 







		           II.       ADMINISTRATION
OF THE PLAN 
	 






		                      A.              The
Board shall appoint the Plan Administrator. The Plan Administrator shall           serve
for such period of time as the Board may determine and may be removed by           the
Board at any time. Notwithstanding the foregoing, stock option grants may be
          made under the Plan only by the compensation committee of the Board or a
          majority of the Corporation’s Independent Directors.  
	 






		                      B.              The
Plan Administrator shall, within the scope of its administrative functions
          under the Plan, have full power and authority (subject to the provisions of the
          Plan) to establish such rules and regulations as it may deem appropriate for
          proper administration of the Plan and to make such determinations under, and
          issue such interpretations of, the provisions of the Plan and any outstanding
          options thereunder as it may deem necessary or advisable. Decisions of the Plan
          Administrator within the scope of its administrative functions under the Plan
          shall be final and binding on all parties who have an interest in any stock
          option thereunder.  
	 






		                      C.              Service
as the Plan Administrator shall constitute service as a Board member,           and
members of the Plan Administrator shall accordingly be entitled to full
          indemnification and reimbursement as Directors for their service on the Plan
          Administrator. No member of the Plan Administrator shall be liable for any act
          or omission made in good faith with respect to the Plan or any option grants or
          stock issuances under the Plan.  
	 






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		           III.      ELIGIBILITY 
	 






		                      A.              The
persons eligible to receive stock option grants under this Plan are           Employees
(i) who were not previously an Employee or Director of the Corporation           or who
have had a bona fide period of non-employment since last being employed           by the
Corporation and (ii) where the stock option grant is an inducement           material to
that person entering into employment with the Corporation. Persons           who become
Employees as a result of a merger or acquisition shall be eligible to           receive a
stock option grant under this Plan.  
	 






		                      B.              The
Plan Administrator shall, within the scope of its administrative           jurisdiction
under the Plan, have full authority to determine, with respect to           the option
grants under the Plan, which eligible persons are to receive such           grants, the
time or times when those grants are to be made, the number of shares           to be
covered by each such grant, the time or times when each option is to           become
exercisable, the vesting schedule (if any) applicable to the option           shares and
the maximum term for which the option is to remain outstanding.  
	 






		                      C.              The
Plan Administrator shall have the absolute discretion to grant options in
          accordance with the Plan.  
	 






		           IV.      STOCK
SUBJECT TO THE PLAN 
	 






		                      A.              The
stock issuable under the Plan shall be shares of authorized but unissued or
          reacquired Common Stock, including shares repurchased by the Corporation on the
          open market. The number of shares of Common Stock initially reserved for
          issuance over the term of the Plan shall not exceed one million five hundred
          thousand (1,500,000) shares.  
	 






		                      B.              Shares
of Common Stock subject to outstanding options shall be available for
          subsequent issuance under the Plan to the extent (i) those options expire or
          terminate for any reason prior to exercise in full or (ii) the options are
          cancelled in accordance with the cancellation-regrant provisions of Article
Two.           Unvested shares issued under the Plan and subsequently cancelled or
repurchased           by the Corporation, at a price per share not greater than the
original issue           price paid per share, pursuant to the Corporation’s
repurchase rights under           the Plan shall be added back to the number of shares of
Common Stock reserved           for issuance under the Plan and shall accordingly be
available for reissuance           through one or more subsequent option grants under the
Plan. However, should the           exercise price of an option under the Plan be paid
with shares of Common Stock           or should shares of Common Stock otherwise issuable
under the Plan be withheld           by the Corporation in satisfaction of the
withholding taxes incurred in           connection with the exercise of an option or the
vesting of stock issued upon           the exercise of an option under the Plan, then the
number of shares of Common           Stock available for issuance under the Plan shall be
reduced by the gross number           of shares for which the option is exercised or
which vest under the stock           issuance, and not by the net number of shares of
Common Stock issued to the           holder of such option or stock issuance.  
	 






		                      C.    If
any change is made to the Common Stock by reason of any stock split, stock dividend,
recapitalization, combination of shares, exchange of shares or other change affecting the
outstanding Common Stock as a class without the Corporation’s receipt of
consideration, appropriate adjustments shall be made by the Plan Administrator to (i) the
  
	 






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		maximum
number and/or class of securities issuable under the Plan, (ii) the maximum number and/or
class of securities for which any one person may be granted stock options under the Plan
per calendar year and (iii) the number and/or class of securities and the exercise price
per share in effect under each outstanding option under the Plan. Such adjustments to the
outstanding options are to be effected in a manner which shall preclude the enlargement
or dilution of rights and benefits under such options. The adjustments determined by the
Plan Administrator shall be final, binding and conclusive. 
	 






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		ARTICLE
TWO 
	 







		DISCRETIONARY
OPTION GRANTS 
	 







		           I.       
OPTION TERMS  
	 






		                      Options
granted under the Plan are not intended to qualify as “incentive stock options”within
the meaning of Section 422 of the Internal Revenue Code of 1986, as amended. Each option
shall be evidenced by one or more documents in the form approved by the Plan
Administrator; provided, however, that each such document shall comply with the
terms specified below.  
	 






		                      A.  
Exercise Price. 
	 






		                                 1.  The
exercise price per share shall be fixed by the Plan Administrator but shall not be less
than one hundred percent (100%) of the Fair Market Value per share of Common Stock on the
option grant date.    
	 






		                                 2.  The
exercise price shall become immediately due upon exercise of the option and shall,
subject to the provisions of Section I of Article Three and the documents
evidencing the option, be payable in one or more of the forms specified below:     
	 






		                                 (i)     cash
or check made payable to the Corporation, 
	 






		                                 (ii)    shares
of Common Stock held for the requisite period necessary to avoid a charge to the
Corporation’s earnings for financial reporting purposes and valued at Fair Market
Value on the Exercise Date, or 
	 






		                                 (iii)   to
the extent the option is exercised for vested shares, through a special sale and
remittance procedure pursuant to which the Optionee shall concurrently provide
irrevocable instructions to (a) a Corporation-designated brokerage firm to effect the
immediate sale of the purchased shares and remit to the Corporation, out of the sale
proceeds available on the settlement date, sufficient funds to cover the aggregate
exercise price payable for the purchased shares plus all applicable income and employment
taxes required to be withheld by the Corporation by reason of such exercise and (b) the
Corporation to deliver the certificates for the purchased shares directly to such
brokerage firm in order to complete the sale. 
	 






		                      Except
to the extent such sale and remittance procedure is utilized, payment of the exercise
price for the purchased shares must be made on the Exercise Date.  
	 






		                      B.  Exercise
and Term of Options. Each option shall be exercisable at such time or times,
during such period and for such number of shares as shall be determined by the Plan
Administrator and set forth in the documents evidencing the option. However, no option
shall have a term in excess of ten (10) years measured from the option grant date. 
	 






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		                      C.  
Effect of Termination of Service. 
	 






		                                 1.  
The following provisions shall govern the exercise of any options held by the Optionee at
the time of cessation of Service or death: 
	 






		                                 (i)     Any
option outstanding at the time of the Optionee’s cessation of Service for any reason
shall remain exercisable for such period of time thereafter as shall be determined by the
Plan Administrator and set forth in the documents evidencing the option, but no such
option shall be exercisable after the expiration of the option term. 
	 






		                                 (ii)    Any
option held by the Optionee at the time of death and exercisable in whole or in part at
that time may be subsequently exercised by the personal representative of the Optionee’s
estate or by the person or persons to whom the option is transferred pursuant to the
Optionee’s will or the laws of inheritance or by the Optionee’s designated
beneficiary or beneficiaries of that option. 
	 






		                                 (iii)   Should
the Optionee’s Service be terminated for Misconduct or should the Optionee otherwise
engage in Misconduct while holding one or more outstanding options under this Article
Two, then all those options shall terminate immediately and cease to be outstanding. 
	 






		                                 (iv)   During
the applicable post-Service exercise period, the option may not be exercised in the
aggregate for more than the number of vested shares for which the option is exercisable
on the date of the Optionee’s cessation of Service. Upon the expiration of the
applicable exercise period or (if earlier) upon the expiration of the option term, the
option shall terminate and cease to be outstanding for any vested shares for which the
option has not been exercised. However, the option shall, immediately upon the Optionee’s
cessation of Service, terminate and cease to be outstanding to the extent the option is
not otherwise at that time exercisable for vested shares. 
	 






		                                 2.  The
Plan Administrator shall have complete discretion, exercisable either at the time an
option is granted or at any time while the option remains outstanding, to: 
	 






		                                 (i)     extend
the period of time for which the option is to remain exercisable following the Optionee’s
cessation of Service from the limited exercise period otherwise in effect for that option
to such greater period of time as the Plan Administrator shall deem appropriate, but in
no event beyond the expiration of the option term, and/or 
	 






		                                 (ii)    permit
the option to be exercised, during the applicable post-Service exercise period, not only
with respect to the number of vested shares of Common Stock for which such option is
exercisable at the time of the Optionee’s cessation of Service but also with respect
to one or more additional installments in which the Optionee would have vested had the
Optionee continued in Service. 
	 






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		                      D.  Stockholder
Rights. The holder of an option shall have no stockholder rights with respect to
the shares subject to the option until such person shall have exercised the option, paid
the exercise price and become a holder of record of the purchased shares. 
	 






		                      E.  Repurchase
Rights. The Plan Administrator shall have the discretion to grant options which
are exercisable for unvested shares of Common Stock. Should the Optionee cease Service
while holding such unvested shares, the Corporation shall have the right, but not the
obligation, to repurchase any or all of those unvested shares at a price per share equal
to the lower of (i) the exercise price paid per share or (ii) the Fair
Market Value per share of Common Stock at the time of the Optionee’s cessation of
Service. The terms upon which such repurchase right shall be exercisable (including the
period and procedure for exercise and the appropriate vesting schedule for the purchased
shares) shall be established by the Plan Administrator and set forth in the document
evidencing such repurchase right. 
	 






		                      F.  Limited
Transferability of Options. Except as otherwise provided in this section, during
the lifetime of the Optionee, options shall be exercisable only by the Optionee and shall
not be assignable or transferable other than by will or the laws of inheritance following
the Optionee’s death. The Plan Administrator may structure one or more options under
the Plan so that each such option may be assigned in whole or in part during the Optionee’s
lifetime to one or more members of the Optionee’s family or to a trust established
exclusively for one or more such family members or to Optionee’s former spouse, to
the extent such assignment is in connection with the Optionee’s estate plan or
pursuant to a domestic relations order. The assigned portion may only be exercised by the
person or persons who acquire a proprietary interest in the option pursuant to the
assignment. The terms applicable to the assigned portion shall be the same as those in
effect for the option immediately prior to such assignment and shall be set forth in such
documents issued to the assignee as the Plan Administrator may deem appropriate.
Notwithstanding the foregoing, the Optionee may also designate one or more persons as the
beneficiary or beneficiaries of his or her outstanding options under this Article Two,
and those options shall, in accordance with such designation, automatically be
transferred to such beneficiary or beneficiaries upon the Optionee’s death while
holding those options. Such beneficiary or beneficiaries shall take the transferred
options subject to all the terms and conditions of the applicable agreement evidencing
each such transferred option, including (without limitation) the limited time period
during which the option may be exercised following the Optionee’s death. 
	 






		           II.       CHANGE
IN CONTROL/HOSTILE TAKE-OVER 
	 






		                      A.  Except
as otherwise provided in this Section II, none of the outstanding options under the Plan
shall vest in whole or in part on an accelerated basis upon the occurrence of a Change in
Control, and those options shall be assumable by any successor corporation in the Change
in Control. However, the Plan Administrator shall have the discretionary authority to
structure one or more options grants under the Plan so that each of those particular
options shall automatically accelerate in whole or in part, immediately prior to the
effective date of that Change in Control, and become exercisable for all the shares of
Common Stock at the time subject to the accelerated portion of such option and may be
exercised for any or all of those accelerated shares as fully vested shares of Common
Stock. 
	 






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		                      B.  Except
as otherwise provided in this Section II, none of the outstanding repurchase rights under
the Plan shall terminate on an accelerated basis upon the occurrence of a Change in
Control, and those rights shall be assignable to any successor corporation in the Change
in Control. However, the Plan Administrator shall have the discretionary authority to
structure one or more repurchase rights under the Plan so that those particular rights
shall automatically terminate in whole or in part, and the shares of Common Stock subject
to those terminated rights shall immediately vest, in the event of a Change in Control. 
	 






		                      C.  Immediately
following the consummation of the Change in Control, all outstanding options under the
Plan shall terminate and cease to be outstanding, except to the extent assumed by the
successor corporation (or parent thereof) or otherwise continued in full force and effect
pursuant to the terms of the Change in Control transaction. 
	 






		                      D.  Each
option which is assumed in connection with a Change in Control or otherwise continued in
effect shall be appropriately adjusted, immediately after such Change in Control, to
apply to the number and class of securities which would have been issuable to the
Optionee in consummation of such Change in Control had the option been exercised
immediately prior to such Change in Control. Appropriate adjustments to reflect such
Change in Control shall also be made to (i) the exercise price payable per share under
each outstanding option, provided the aggregate exercise price payable for such
securities shall remain the same, (ii) the maximum number and/or class of securities
available for issuance over the remaining term of the Plan and (iii) the maximum number
and/or class of securities for which any one person may be granted stock options under
the Plan per calendar year. To the extent the actual holders of the Corporation’s
outstanding Common Stock receive cash consideration for their Common Stock in
consummation of the Change in Control, the successor corporation may, in connection with
the assumption of the outstanding options under the Plan, substitute one or more shares
of its own common stock with a fair market value equivalent to the cash consideration
paid per share of Common Stock in such Change in Control transaction. 
	 






		                      E.  The
Plan Administrator shall have full power and authority to structure one or more
outstanding options under the Plan so that those options shall become exercisable for all
the shares of Common Stock at the time subject to those options in the event the Optionee’s
Service is subsequently terminated by reason of an Involuntary Termination within a
designated period (not to exceed eighteen (18) months) following the effective date of
any Change in Control transaction in which those options do not otherwise accelerate. In
addition, the Plan Administrator may structure one or more of the Corporation’s
repurchase rights so that those rights shall immediately terminate with respect to any
shares held by the Optionee at the time of such Involuntary Termination, and the shares
subject to those terminated repurchase rights shall accordingly vest in full at that time. 
	 






		                      F.  The
Plan Administrator shall have the discretionary authority to structure one or more
outstanding options under the Plan so that those options shall, immediately prior to the
effective date of a Hostile Take-Over, become exercisable for all the shares of Common
Stock at the time subject to those options and may be exercised for any or all of those
shares as fully vested shares of Common Stock. In addition, the Plan Administrator shall
have the discretionary authority to structure one or more of the Corporation’s
repurchase rights under the Plan so that those rights shall terminate automatically upon
the consummation of such Hostile Take-Over,  
	 






7








		and
the shares subject to those terminated rights shall thereupon vest in full.
Alternatively, the Plan Administrator may condition the automatic acceleration of one or
more outstanding options under the Plan and the termination of one or more of the
Corporation’s outstanding repurchase rights upon the subsequent termination of the
Optionee’s Service by reason of an Involuntary Termination within a designated
period (not to exceed eighteen (18) months) following the effective date of such Hostile
Take-Over. 
	 






		                      G.  The
outstanding options shall in no way affect the right of the Corporation to adjust,
reclassify, reorganize or otherwise change its capital or business structure or to merge,
consolidate, dissolve, liquidate or sell or transfer all or any part of its business or
assets. 
	 






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		ARTICLE
THREE 
	 







		MISCELLANEOUS 
	 







		           I.        
FINANCING  
	 






		                      The
Plan Administrator may permit any Optionee to pay the option exercise price by delivering
a full-recourse, interest-bearing promissory note payable in one or more installments.
The terms of any such promissory note (including the interest rate, which must be at
market, and the terms of repayment) shall be established by the Plan Administrator in its
sole discretion. In no event may the maximum credit available to the Optionee exceed the
sum of (i) the aggregate option exercise price or purchase price payable for the
purchased shares (less the par value of such shares) plus (ii) any applicable income and
employment tax liability incurred by the Optionee in connection with the option exercise
or share purchase.  
	 






		           II.      TAX
WITHHOLDING 
	 






		                      A.            The
Corporation’s obligation to deliver shares of Common Stock upon the
          exercise of options or the vesting of such shares under the Plan shall be
          subject to the satisfaction of all applicable income and employment tax
          withholding requirements. The Corporation shall also make appropriate
          arrangements to satisfy all applicable foreign tax withholding requirements
          which may be imposed in connection with the grant or exercise of options under
          the Plan or the vesting of shares of Common Stock under the Plan.  
	 






		                      B.            The
Plan Administrator may, in its discretion, provide any or all Optionees           under
the Plan with the right to use shares of Common Stock in satisfaction of           all or
part of the Withholding Taxes to which such individuals may become           subject in
connection with the grant or exercise of their options or the vesting           of their
shares. Such right may be provided to any such holder in either or both           of the
following formats:  
	 






		                                 1.  Stock
Withholding: The election to have the Corporation withhold, from           the shares
of Common Stock otherwise issuable upon the exercise of options or           the vesting
of such shares, a portion of those shares with an aggregate Fair           Market Value
equal to the percentage of the Withholding Taxes (not to exceed one           hundred
percent (100%)) designated by the holder.  
	 






		                                 2.  Stock
Delivery: The election to deliver to the Corporation, at the time           the
option is granted or exercised or the shares vest, one or more shares of           Common
Stock previously acquired by such holder (other than in connection with           the
option exercise or share vesting triggering the Withholding Taxes) with an
          aggregate Fair Market Value equal to the percentage of the Withholding Taxes
          (not to exceed one hundred percent (100%)) designated by the holder.  
	 






		           III.     EFFECTIVE
DATE AND TERM OF THE PLAN 
	 






		                      A.            The
Plan shall become effective immediately on the Plan Effective Date. Options           may
be granted under the Plan at any time on or after the Plan Effective Date.  
	 






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		                      B.            The
Plan shall terminate upon the earliest to occur of (i) the date           on
which all shares available for issuance under the Plan shall have been issued
          as fully vested shares; (ii) the termination of all outstanding options in
          connection with a Change in Control; or (iii) the termination of the Plan by
the           Board. Should the Board terminate the Plan, then all option grants and
unvested           stock issuances outstanding at that time shall continue to have force
and effect           in accordance with the provisions of the documents evidencing such
grants or           issuances.  
	 






		           IV.      AMENDMENT
OF THE PLAN 
	 






		                      The
Board shall have complete and exclusive power and authority to amend or modify the Plan
in any or all respects. However, no such amendment or modification shall adversely affect
the rights and obligations with respect to stock options or unvested stock issuances at
the time outstanding under the Plan unless the Optionee consents to such amendment or
modification. In addition, certain amendments may require stockholder approval pursuant
to applicable laws or regulations.  
	 






		           V.       USE
OF PROCEEDS 
	 






		                      Any
cash proceeds received by the Corporation from the sale of shares of Common Stock under
the Plan shall be used for general corporate purposes.  
	 






		           VI.      REGULATORY
APPROVALS 
	 






		                      A.            The
implementation of the Plan, the granting of any stock option under the Plan           and
the issuance of any shares of Common Stock upon the exercise of any granted
          option shall be subject to the Corporation’s procurement of all approvals
          and permits required by regulatory authorities having jurisdiction over the
          Plan, the stock options granted under it and the shares of Common Stock issued
          pursuant to it.  
	 






		                      B.            No
shares of Common Stock or other assets shall be issued or delivered under the
          Plan unless and until there shall have been compliance with all applicable
          requirements of applicable securities laws, including the filing and
          effectiveness of the Form S-8 registration statement for the shares of Common
          Stock issuable under the Plan, and all applicable listing requirements of any
          stock exchange (or the Nasdaq National Market, if applicable) on which Common
          Stock is then listed for trading.  
	 






		           VII.    NO
EMPLOYMENT/SERVICE RIGHTS 
	 






		                      Nothing
in the Plan shall confer upon the Optionee any right to continue in Service for any
period of specific duration or interfere with or otherwise restrict in any way the rights
of the Corporation (or any Parent or Subsidiary employing or retaining such person) or of
the Optionee, which rights are hereby expressly reserved by each, to terminate such person’s
Service at any time for any reason, with or without cause.  
	 






10

















		APPENDIX

	 






		                      The
following definitions shall be in effect under the Plan:  
	 






		                      A.  Board shall
mean the Corporation’s Board of Directors. 
	 






		                      B.  Code shall
mean the U.S. Internal Revenue Code of 1986, as amended. 
	 






		                      C.  Change
in Control shall mean a change in ownership or control of the Corporation
effected through any of the following transactions: 
	 






		                      (i)     there
is consummated a merger, consolidation or other reorganization, unless securities
representing more than fifty percent (50%) of the total combined voting power of the
voting securities of the successor corporation are immediately thereafter beneficially
owned, directly or indirectly and in substantially the same proportion, by the persons
who beneficially owned the Corporation’s outstanding voting securities immediately
prior to such transaction, or      
	 






		                      (ii)    the
sale, transfer or other disposition of all or substantially all of the Corporation’s
assets in complete liquidation or dissolution of the Corporation other than a sale or
disposition by the Corporation of all or substantially all of the Corporation’s
assets to an entity, at least 50% of the combined voting power of the voting securities
of which are owned by stockholders of the Corporation in substantially the same
proportions as their ownership of the Corporation immediately prior to such sale, or
  
	 






		                      (iii)   the
acquisition, directly or indirectly by any Person or related group of Persons (other than
the Corporation or a Person that directly or indirectly controls, is controlled by, or is
under common control with, the Corporation), of beneficial ownership (within the meaning
of Rule 13d-3 of the 1934 Act) of securities possessing more than thirty percent (30%) of
the total combined voting power of the Corporation’s outstanding securities pursuant
to a tender or exchange offer made directly to the Corporation’s stockholders.   
	 






		                      Notwithstanding
the foregoing, a “Change in Control” shall not be deemed to have occurred by
virtue of the consummation of any transaction or series of integrated transactions
immediately following which the record holders of the Common Stock immediately prior to
such transaction or series of transactions continue to have substantially the same
proportionate ownership in an entity which owns all or substantially all of the assets of
the Corporation immediately following such transaction or series of transactions. 
	 






		                      D.  Common
Stock shall mean the Corporation’s common stock. 
	 






A-1









		                      E.  Corporation shall
mean Borland Software Corporation, a Delaware corporation, and any corporate successor to
all or substantially all of the assets or voting stock of Borland Software Corporation
which shall by appropriate action adopt the Plan. 
	 






		                      F.  Director shall
mean a member of the Board. 
	 






		                      G.  Employee shall
mean an individual who is in the employ of the Corporation (or any Parent or Subsidiary),
subject to the control and direction of the employer entity as to both the work to be
performed and the manner and method of performance. 
	 






		                      H.  Exercise
Date shall mean the date on which the Corporation shall have received
written notice of the option exercise. 
	 






		                      I.  Fair
Market Value per share of Common Stock on any relevant date shall be
determined in accordance with the following provisions: 
	 






		                      (i)     If
the Common Stock is at the time traded on the Nasdaq National Market, then the Fair
Market Value shall be the last sale price per share of Common Stock on the date in
question, as such price is reported by the National Association of Securities Dealers on
the Nasdaq National Market and published in The Wall Street Journal. If there
is no sale price for the Common Stock on the date in question, then the Fair Market Value
shall be the last sale price on the last preceding date for which such quotation exists. 
	 







		                      (ii)     If
the Common Stock is at the time listed on any Stock Exchange, then the Fair Market Value
shall be the last sale price per share of Common Stock on the date in question on the
Stock Exchange determined by the Plan Administrator to be the primary market for the
Common Stock, as such price is officially quoted in the composite tape of transactions on
such exchange and published in The Wall Street Journal. If there is no sale price
for the Common Stock on the date in question, then the Fair Market Value shall be the
last sale price on the last preceding date for which such quotation exists. 
	 





		                      J.  Hostile
Take-Over shall mean a change in ownership or control of the Corporation
effected through either of the following transactions: 
	 






		                      (i)     a
change in the composition of the Board such that the following individuals cease for any
reason to constitute a majority of the number of Directors then serving: individuals who,
on the date hereof, constitute the Board and any new Director (other than a Director
whose initial assumption of office is in connection with an actual or threatened election
contest, including but not limited to a consent solicitation, relating to the election of
Directors) whose appointment or election by the Board or nomination for election by the
Corporation’s stockholders was approved or recommended by a vote of at least
two-thirds (2/3) of the Directors then still in office who either were Directors on 
	 






A-2









		the
date hereof or whose appointment, election or nomination for election was previously so
approved or recommended, or  
	 






		                      (ii)     the
acquisition, directly or indirectly, by any Person or related group of Persons (other
than the Corporation or a Person that directly or indirectly controls, is controlled by,
or is under common control with, the Corporation) of beneficial ownership (within the
meaning of Rule 13d-3 of the 1934 Act) of securities possessing more than thirty percent
(30%) of the total combined voting power of the Corporation’s outstanding securities
pursuant to a tender or exchange offer made directly to the Corporation’s
stockholders which the Board does not recommend such stockholders to accept. 
	 






		                      K.  Independent
Director shall have the meaning defined in the Quantitative Listing
Requirements for the Nasdaq National Market or the rules of such Stock Exchange on which
the Corporation’s common stock is primarily traded. 
	 






		                      L.  Involuntary
Termination shall mean the termination of the Service of any individual
which occurs by reason of: 
	 






		                      (i)     such
individual’s involuntary dismissal or discharge by the Corporation for reasons other
than Misconduct, or 
	 






		                      (ii)     such
individual’s voluntary resignation following (A) a change in his or her position
with the Corporation which materially reduces his or her duties and responsibilities or
the level of management to which he or she reports, (B) a reduction in his or her level
of compensation (including base salary, fringe benefits and target bonus under any
corporate-performance based bonus or incentive programs) by more than fifteen percent
(15%) or (C) a relocation of such individual’s place of employment by more than fifty (50)
miles, provided and only if such change, reduction or relocation is effected by the
Corporation without the individual’s consent. 
	 






		                      M.  Misconduct shall
mean the commission of any act of fraud, embezzlement or dishonesty by the Optionee, any
unauthorized use or disclosure by such person of confidential information or trade
secrets of the Corporation (or any Parent or Subsidiary), or any other intentional
misconduct by such person adversely affecting the business or affairs of the Corporation
(or any Parent or Subsidiary) in a material manner. The foregoing definition shall not in
any way preclude or restrict the right of the Corporation (or any Parent or Subsidiary)
to discharge or dismiss any Optionee or other person in the Service of the Corporation
(or any Parent or Subsidiary) for any other acts or omissions, but such other acts or
omissions shall not be deemed, for purposes of the Plan, to constitute grounds for
termination for Misconduct. 
	 






		                      N.  1934
Act shall mean the Securities Exchange Act of 1934, as amended or any
successor statute. 
	 






		                      O.  Optionee shall
mean any person to whom an option is granted under the Plan. 
	 






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		                      P.  Parent shall
mean any corporation (other than the Corporation) in an unbroken chain of corporations
ending with the Corporation, provided each corporation in the unbroken chain (other than
the Corporation) owns, at the time of the determination, stock possessing fifty percent
(50%) or more of the total combined voting power of all classes of stock in one of the
other corporations in such chain. 
	 






		                      Q.  Permanent
Disability or Permanently Disabled shall mean the inability of the Optionee
to engage in any substantial gainful activity by reason of any medically determinable
physical or mental impairment expected to result in death or to be of continuous duration
of twelve (12) months or more. 
	 






		                      R.  Person shall
have the meaning given in Section 3(a)(9) of the Securities Exchange Act of 1934, as
modified and use in Sections 13(d) and 14(d) thereof, except that such term shall not
include (i) the Corporation or any of its subsidiaries, (ii) a trustee or other fiduciary
holding securities under an employee benefit plan of the Corporation or any of its
Affiliates, (iii) an underwriter temporarily holding securities pursuant to an offering
of such securities, or (iv) a corporation owned, directly or indirectly, by the
stockholders of the Corporation in substantially the same proportions as their ownership
of stock of the Corporation. 
	 






		                      S.  Plan shall
mean the Corporation’s 2003 Supplemental Stock Option Plan, as set forth in this
document. 
	 






		                      T.  Plan
Administrator shall mean the compensation committee of the Board, a majority
of the Independent Directors of the Board to the extent such entity is carrying out its
administrative functions under the Plan. For purposes of the Plan the definition of
compensation committee shall be determined under the Quantitative Listing Requirements
for the Nasdaq National Market or such Stock Exchange on which the Corporation’s
common stock is primarily traded. 
	 






		                      U.  Plan
Effective Date shall mean the date the Plan becomes effective and shall be
coincidental with the date the Plan is approved by the Board. 
	 






		                      V.  Service shall
mean the performance of services for the Corporation (or any Parent or Subsidiary) by a
person in the capacity of an Employee, or a consultant or independent advisor, except to
the extent otherwise specifically provided in the documents evidencing the option grant.
Service shall not be deemed to cease during a period of military leave, sick leave or
other personal leave approved by the Corporation. Unless otherwise required by law, no
Service credit shall be given for vesting purposes for any period the Optionee is on a
leave of absence. 
	 






		                      W.  Stock
Exchange shall mean either the American Stock Exchange or the New York Stock
Exchange. 
	 






		                      X.  Subsidiary shall
mean any corporation (other than the Corporation) in an unbroken chain of corporations
beginning with the Corporation, provided each corporation (other than the last
corporation) in the unbroken chain owns, at the time of the determination, stock
 
	 






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		possessing
fifty percent (50%) or more of the total combined voting power of all classes of stock in
one of the other corporations in such chain. 
	 






		                      Y.  Withholding
Taxes shall mean the applicable income and employment withholding taxes to
which the holder of an option or shares of Common Stock under the Plan may become subject
in connection with the grant or exercise of those options or the issuance or vesting of
those shares. 
	 





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