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                               INTERWOVEN, INC.

                          1999 EQUITY INCENTIVE PLAN

                           As Adopted July 22, 1999
  As Amended April 13, 2000 and June 1, 2000 (effective as of June 22, 2000)


         1.   PURPOSE.  The purpose of this Plan is to provide incentives to
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attract, retain and motivate eligible persons whose present and potential
contributions are important to the success of the Company, its Parent and
Subsidiaries, by offering them an opportunity to participate in the Company's
future performance through awards of Options, Restricted Stock and Stock
Bonuses.  Capitalized terms not defined in the text are defined in Section 23.

         2.   SHARES SUBJECT TO THE PLAN.
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              2.1  Number of Shares Available.  Subject to Sections 2.2 and 18,
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the total number of Shares reserved and available for grant and issuance
pursuant to this Plan will be 9,800,000/1/ Shares plus Shares that are subject
to: (a) issuance upon exercise of an Option but cease to be subject to such
Option for any reason other than exercise of such Option; (b) an Award granted
hereunder but are forfeited or are repurchased by the Company at the original
issue price; and (c) an Award that otherwise terminates without Shares being
issued.  In addition, any authorized shares not issued or subject to outstanding
grants under the 1996 Stock Option Plan and the 1998 Stock Option Plan (the
"Prior Plans") on the Effective Date (as defined below) and any shares issued
under the Prior Plans that are forfeited or repurchased by the Company or that
are issuable upon exercise of options granted pursuant to the Prior Plans that
expire or become unexercisable for any reason without having been exercised in
full, will no longer be available for grant and issuance under the Prior Plans,
but will be available for grant and issuance under this Plan.  At all times the
Company shall reserve and keep available a sufficient number of Shares as shall
be required to satisfy the requirements of all outstanding Options granted under
this Plan and all other outstanding but unvested Awards granted under this Plan.


              2.2  Adjustment of Shares.  In the event that the number of
                   --------------------
outstanding shares is changed by a stock dividend, recapitalization, stock
split, reverse stock split, subdivision, combination, reclassification or
similar change in the capital structure of the Company without consideration,
then (a) the number of Shares reserved for issuance under this Plan, (b) the
Exercise Prices of and number of Shares subject to outstanding Options, and (c)
the number of Shares subject to other outstanding Awards will be proportionately
adjusted, subject to any required action by the Board or the stockholders of the
Company and compliance with applicable securities laws; provided, however, that
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fractions of a Share will not be issued but will either be replaced by a cash
payment equal to the Fair Market Value of such fraction of a Share or will be
rounded up to the nearest whole Share, as determined by the Committee.

____________________
/1/  Adjusted to reflect (i) the authorization of 2,000,000 additional shares of
     Common Stock for issuance under the Plan approved by the Company's
     stockholders on June 1, 2000; and (ii) the 2-for-1 split of the Company's
     capital stock effected in June 2000.
<PAGE>

         3.   ELIGIBILITY.  ISOs (as defined in Section 5 below) may be granted
              -----------
only to employees (including officers and directors who are also employees) of
the Company or of a Parent or Subsidiary of the Company.  All other Awards may
be granted to employees, officers, directors, consultants, independent
contractors and advisors of the Company or any Parent or Subsidiary of the
Company; provided such consultants, contractors and advisors render bona fide
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services not in connection with the offer and sale of securities in a capital-
raising transaction.  No person will be eligible to receive more than 1,000,000
Shares in any calendar year under this Plan pursuant to the grant of Awards
hereunder, other than new employees of the Company or of a Parent or Subsidiary
of the Company (including new employees who are also officers and directors of
the Company or any Parent or Subsidiary of the Company), who are eligible to
receive up to a maximum of 1,500,000 Shares in the calendar year in which they
commence their employment.  A person may be granted more than one Award under
this Plan.

         4.   ADMINISTRATION.
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              4.1  Committee Authority.  This Plan will be administered by the
                   -------------------
Committee or by the Board acting as the Committee.  Except for automatic grants
to Outside Directors pursuant to Section 9 hereof, and subject to the general
purposes, terms and conditions of this Plan, and to the direction of the Board,
the Committee will have full power to implement and carry out this Plan.  Except
for automatic grants to Outside Directors pursuant to Section 9 hereof, the
Committee will have the authority to:

         (a)  construe and interpret this Plan, any Award Agreement and any
              other agreement or document executed pursuant to this Plan;

         (b)  prescribe, amend and rescind rules and regulations relating to
              this Plan or any Award;

         (c)  select persons to receive Awards;

         (d)  determine the form and terms of Awards;

         (e)  determine the number of Shares or other consideration subject to
              Awards;

         (f)  determine whether Awards will be granted singly, in combination
              with, in tandem with, in replacement of, or as alternatives to,
              other Awards under this Plan or any other incentive or
              compensation plan of the Company or any Parent or Subsidiary of
              the Company;

         (g)  grant waivers of Plan or Award conditions;

         (h)  determine the vesting, exercisability and payment of Awards;

         (i)  correct any defect, supply any omission or reconcile any
              inconsistency in this Plan, any Award or any Award Agreement;

         (j)  determine whether an Award has been earned; and
<PAGE>

         (k)  make all other determinations necessary or advisable for the
              administration of this Plan.

              4.2  Committee Discretion.  Except for automatic grants to Outside
                   --------------------
Directors pursuant to Section 9 hereof, any determination made by the Committee
with respect to any Award will be made in its sole discretion at the time of
grant of the Award or, unless in contravention of any express term of this Plan
or Award, at any later time, and such determination will be final and binding on
the Company and on all persons having an interest in any Award under this Plan.
The Committee may delegate to one or more officers of the Company the authority
to grant an Award under this Plan to Participants who are not Insiders of the
Company.

         5.   OPTIONS.  The Committee may grant Options to eligible persons and
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will determine whether such Options will be Incentive Stock Options within the
meaning of the Code ("ISO") or Nonqualified Stock Options ("NQSOs"), the number
of Shares subject to the Option, the Exercise Price of the Option, the period
during which the Option may be exercised, and all other terms and conditions of
the Option, subject to the following:

              5.1  Form of Option Grant.  Each Option granted under this Plan
                   --------------------
will be evidenced by an Award Agreement which will expressly identify the Option
as an ISO or an NQSO ("Stock Option Agreement"), and, except as otherwise
required by the terms of Section 9 hereof, will be in such form and contain such
provisions (which need not be the same for each Participant) as the Committee
may from time to time approve, and which will comply with and be subject to the
terms and conditions of this Plan.

              5.2  Date of Grant.  The date of grant of an Option will be the
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date on which the Committee makes the determination to grant such Option, unless
otherwise specified by the Committee.  The Stock Option Agreement and a copy of
this Plan will be delivered to the Participant within a reasonable time after
the granting of the Option.

              5.3  Exercise Period.  Options may be exercisable within the times
                   ---------------
or upon the events determined by the Committee as set forth in the Stock Option
Agreement governing such Option; provided, however, that no Option will be
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exercisable after the expiration of ten (10) years from the date the Option is
granted; and provided further that no ISO granted to a person who directly or by
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attribution owns more than ten percent (10%) of the total combined voting power
of all classes of stock of the Company or of any Parent or Subsidiary of the
Company ("Ten Percent Stockholder") will be exercisable after the expiration of
five (5) years from the date the ISO is granted.  The Committee also may provide
for Options to become exercisable at one time or from time to time, periodically
or otherwise, in such number of Shares or percentage of Shares as the Committee
determines.

              5.4  Exercise Price.  The Exercise Price of an Option will be
                   --------------
determined by the Committee when the Option is granted and may be not less than
85% of the Fair Market Value of the Shares on the date of grant; provided that:
(i) the Exercise Price of an ISO will be not less than 100% of the Fair Market
Value of the Shares on the date of grant; and (ii) the Exercise Price of any ISO
granted to a Ten Percent Stockholder will not be less than 110% of the Fair
Market Value of the Shares on the date of grant.  Payment for the Shares
purchased may be made in accordance with Section 8 of this Plan.
<PAGE>

              5.5  Method of Exercise.  Options may be exercised only by
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delivery to the Company of a written stock option exercise agreement  (the
"Exercise Agreement") in a form approved by the Committee (which need not be the
same for each Participant), stating the number of Shares being purchased, the
restrictions imposed on the Shares purchased under such Exercise Agreement, if
any, and such representations and agreements regarding Participant's investment
intent and access to information and other matters, if any, as may be required
or desirable by the Company to comply with applicable securities laws, together
with payment in full of the Exercise Price for the number of Shares being
purchased.

              5.6  Termination.  Notwithstanding the exercise periods set forth
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in the Stock Option Agreement, exercise of an Option will always be subject to
the following:

         (a)  If the Participant is Terminated for any reason except death or
              Disability, then the Participant may exercise such Participant's
              Options only to the extent that such Options would have been
              exercisable upon the Termination Date no later than three (3)
              months after the Termination Date (or such shorter or longer time
              period not exceeding five (5) years as may be determined by the
              Committee, with any exercise beyond three (3) months after the
              Termination Date deemed to be an NQSO), but in any event, no later
              than the expiration date of the Options.

         (b)  If the Participant is Terminated because of Participant's death or
              Disability (or the Participant dies within three (3) months after
              a Termination other than for Cause or because of Participant's
              Disability), then Participant's Options may be exercised only to
              the extent that such Options would have been exercisable by
              Participant on the Termination Date and must be exercised by
              Participant (or Participant's legal representative or authorized
              assignee) no later than twelve (12) months after the Termination
              Date (or such shorter or longer time period not exceeding five (5)
              years as may be determined by the Committee, with any such
              exercise beyond (a) three (3) months after the Termination Date
              when the Termination is for any reason other than the
              Participant's death or Disability, or (b) twelve (12) months after
              the Termination Date when the Termination is for Participant's
              death or Disability, deemed to be an NQSO), but in any event no
              later than the expiration date of the Options.

         (c)  Notwithstanding the provisions in paragraph 5.6(a) above, if a
              Participant is terminated for Cause, neither the Participant, the
              Participant's estate nor such other person who may then hold the
              Option shall be entitled to exercise any Option with respect to
              any Shares whatsoever, after termination of service, whether or
              not after termination of service the Participant may receive
              payment from the Company or Subsidiary for vacation pay, for
              services rendered prior to termination, for services rendered for
              the day on which termination occurs, for salary in lieu of notice,
              or for any other benefits.  In making such determination, the
              Board shall give the Participant an opportunity to present to the
              Board evidence on his behalf.  For the purpose of this paragraph,
              termination of service shall be deemed to occur on the date when
              the Company dispatches notice or advice to the Participant that
              his service is terminated.
<PAGE>

              5.7  Limitations on Exercise.  The Committee may specify a
                   -----------------------
reasonable minimum number of Shares that may be purchased on any exercise of an
Option, provided that such minimum number will not prevent Participant from
exercising the Option for the full number of Shares for which it is then
exercisable.


              5.8  Limitations on ISO.  The aggregate Fair Market Value
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(determined as of the date of grant) of Shares with respect to which ISO are
exercisable for the first time by a Participant during any calendar year (under
this Plan or under any other incentive stock option plan of the Company, Parent
or Subsidiary of the Company) will not exceed $100,000.  If the Fair Market
Value of Shares on the date of grant with respect to which ISO are exercisable
for the first time by a Participant during any calendar year exceeds $100,000,
then the Options for the first $100,000 worth of Shares to become exercisable in
such calendar year will be ISO and the Options for the amount in excess of
$100,000 that become exercisable in that calendar year will be NQSOs.  In the
event that the Code or the regulations promulgated thereunder are amended after
the Effective Date of this Plan to provide for a different limit on the Fair
Market Value of Shares permitted to be subject to ISO, such different limit will
be automatically incorporated herein and will apply to any Options granted after
the effective date of such amendment.

              5.9  Modification, Extension or Renewal.  The Committee may
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modify, extend or renew outstanding Options and authorize the grant of new
Options in substitution therefor, provided that any such action may not, without
the written consent of a Participant, impair any of such Participant's rights
under any Option previously granted.  Any outstanding ISO that is modified,
extended, renewed or otherwise altered will be treated in accordance with
Section 424(h) of the Code.  The Committee may reduce the Exercise Price of
outstanding Options without the consent of Participants affected by a written
notice to them; provided, however, that the Exercise Price may not be reduced
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below the minimum Exercise Price that would be permitted under Section 5.4 of
this Plan for Options granted on the date the action is taken to reduce the
Exercise Price.

              5.10 No Disqualification.  Notwithstanding any other provision in
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this Plan, no term of this Plan relating to ISO will be interpreted, amended or
altered, nor will any discretion or authority granted under this Plan be
exercised, so as to disqualify this Plan under Section 422 of the Code or,
without the consent of the Participant affected, to disqualify any ISO under
Section 422 of the Code.

         6.   RESTRICTED STOCK.  A Restricted Stock Award is an offer by the
              ----------------
Company to sell to an eligible person Shares that are subject to restrictions.
The Committee will determine to whom an offer will be made, the number of Shares
the person may purchase, the price to be paid (the "Purchase Price"), the
restrictions to which the Shares will be subject, and all other terms and
conditions of the Restricted Stock Award, subject to the following:

              6.1  Form of Restricted Stock Award.  All purchases under a
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Restricted Stock Award made pursuant to this Plan will be evidenced by an Award
Agreement ("Restricted Stock Purchase Agreement") that will be in such form
(which need not be the same for each Participant) as the Committee will from
time to time approve, and will comply with and be subject to the terms and
conditions of this Plan.  The offer of Restricted Stock will be accepted by the
Participant's execution and delivery of the Restricted Stock Purchase Agreement
and full payment for the Shares to the Company within thirty (30) days from the
date the Restricted Stock
<PAGE>

Purchase Agreement is delivered to the person. If such person does not execute
and deliver the Restricted Stock Purchase Agreement along with full payment for
the Shares to the Company within thirty (30) days, then the offer will
terminate, unless otherwise determined by the Committee.

              6.2  Purchase Price.  The Purchase Price of Shares sold pursuant
                   --------------
to a Restricted Stock Award will be determined by the Committee on the date the
Restricted Stock Award is granted, except in the case of a sale to a Ten Percent
Stockholder, in which case the Purchase Price will be 100% of the Fair Market
Value.  Payment of the Purchase Price may be made in accordance with Section 8
of this Plan.

              6.3  Terms of Restricted Stock Awards.  Restricted Stock Awards
                   --------------------------------
shall be subject to such restrictions as the Committee may impose.  These
restrictions may be based upon completion of a specified number of years of
service with the Company or upon completion of the performance goals as set out
in advance in the Participant's individual Restricted Stock Purchase Agreement.
Restricted Stock Awards may vary from Participant to Participant and between
groups of Participants.  Prior to the grant of a Restricted Stock Award, the
Committee shall:  (a) determine the nature, length and starting date of any
Performance Period for the Restricted Stock Award; (b) select from among the
Performance Factors to be used to measure performance goals, if any; and (c)
determine the number of Shares that may be awarded to the Participant.  Prior to
the payment of any Restricted Stock Award, the Committee shall determine the
extent to which such Restricted Stock Award has been earned.  Performance
Periods may overlap and Participants may participate simultaneously with respect
to Restricted Stock Awards that are subject to different Performance Periods and
having different performance goals and other criteria.

              6.4  Termination During Performance Period.  If a Participant is
                   -------------------------------------
Terminated during a Performance Period for any reason, then such Participant
will be entitled to payment (whether in Shares, cash or otherwise) with respect
to the Restricted Stock Award only to the extent earned as of the date of
Termination in accordance with the Restricted Stock Purchase Agreement, unless
the Committee will determine otherwise.

         7.   STOCK BONUSES.
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              7.1  Awards of Stock Bonuses.  A Stock Bonus is an award of Shares
                   -----------------------
(which may consist of Restricted Stock) for services rendered to the Company or
any Parent or Subsidiary of the Company.  A Stock Bonus may be awarded for past
services already rendered to the Company, or any Parent or Subsidiary of the
Company pursuant to an Award Agreement (the "Stock Bonus Agreement") that will
be in such form (which need not be the same for each Participant) as the
Committee will from time to time approve, and will comply with and be subject to
the terms and conditions of this Plan.  A Stock Bonus may be awarded upon
satisfaction of such performance goals as are set out in advance in the
Participant's individual Award Agreement (the "Performance Stock Bonus
Agreement") that will be in such form (which need not be the same for each
Participant) as the Committee will from time to time approve, and will comply
with and be subject to the terms and conditions of this Plan.  Stock Bonuses may
vary from Participant to Participant and between groups of Participants, and may
be based upon the achievement of the Company, Parent or Subsidiary and/or
individual performance factors or upon such other criteria as the Committee may
determine.
<PAGE>

              7.2  Terms of Stock Bonuses.  The Committee will determine the
                   ----------------------
number of Shares to be awarded to the Participant.  If the Stock Bonus is being
earned upon the satisfaction of performance goals pursuant to a Performance
Stock Bonus Agreement, then the Committee will: (a)  determine the nature,
length and starting date of any Performance Period for each Stock Bonus; (b)
select from among the Performance Factors to be used to measure the performance,
if any; and (c) determine the number of Shares that may be awarded to the
Participant.  Prior to the payment of any Stock Bonus, the Committee shall
determine the extent to which such Stock Bonuses have been earned.  Performance
Periods may overlap and Participants may participate simultaneously with respect
to Stock Bonuses that are subject to different Performance Periods and different
performance goals and other criteria.  The number of Shares may be fixed or may
vary in accordance with such performance goals and criteria as may be determined
by the Committee.  The Committee may adjust the performance goals applicable to
the Stock Bonuses to take into account changes in law and accounting or tax
rules and to make such adjustments as the Committee deems necessary or
appropriate to reflect the impact of extraordinary or unusual items, events or
circumstances to avoid windfalls or hardships.

              7.3  Form of Payment.  The earned portion of a Stock Bonus may be
                   ---------------
paid currently or on a deferred basis with such interest or dividend equivalent,
if any, as the Committee may determine.  Payment may be made in the form of cash
or whole Shares or a combination thereof, either in a lump sum payment or in
installments, all as the Committee will determine.

         8.   PAYMENT FOR SHARE PURCHASES.
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              8.1  Payment.  Payment for Shares purchased pursuant to this Plan
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may be made in cash (by check) or, where expressly approved for the Participant
by the Committee and where permitted by law:

         (a)  by cancellation of indebtedness of the Company to the Participant;

         (b)  by surrender of shares that either:  (1) have been owned by
              Participant for more than six (6) months and have been paid for
              within the meaning of SEC Rule 144 (and, if such shares were
              purchased from the Company by use of a promissory note, such note
              has been fully paid with respect to such shares); or (2) were
              obtained by Participant in the public market;

         (c)  by tender of a full recourse promissory note having such terms as
              may be approved by the Committee and bearing interest at a rate
              sufficient to avoid imputation of income under Sections 483 and
              1274 of the Code; provided, however, that Participants who are not
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              employees or directors of the Company will not be entitled to
              purchase Shares with a promissory note unless the note is
              adequately secured by collateral other than the Shares;

         (d)  by waiver of compensation due or accrued to the Participant for
              services rendered;

         (e)  with respect only to purchases upon exercise of an Option, and
              provided that a public market for the Company's stock exists:
<PAGE>

              (1)  through a "same day sale" commitment from the Participant and
                   a broker-dealer that is a member of the National Association
                   of Securities Dealers (an "NASD Dealer") whereby the
                   Participant irrevocably elects to exercise the Option and to
                   sell a portion of the Shares so purchased to pay for the
                   Exercise Price, and whereby the NASD Dealer irrevocably
                   commits upon receipt of such Shares to forward the Exercise
                   Price directly to the Company; or

              (2)  through a "margin" commitment from the Participant and a NASD
                   Dealer whereby the Participant irrevocably elects to exercise
                   the Option and to pledge the Shares so purchased to the NASD
                   Dealer in a margin account as security for a loan from the
                   NASD Dealer in the amount of the Exercise Price, and whereby
                   the NASD Dealer irrevocably commits upon receipt of such
                   Shares to forward the Exercise Price directly to the Company;
                   or

         (f)  by any combination of the foregoing.

              8.2  Loan Guarantees.  The Committee may help the Participant pay
                   ---------------
for Shares purchased under this Plan by authorizing a guarantee by the Company
of a third-party loan to the Participant.

         9.   AUTOMATIC GRANTS TO OUTSIDE DIRECTORS.
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              9.1  Types of Options and Shares.  Options granted under this Plan
                   ----------------------------
and subject to this Section 9 shall be NQSOs.

              9.2  Eligibility.  Options subject to this Section 9 shall be
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granted only to Outside Directors.

              9.3  Annual Grants.  Each Outside Director who was a member of the
                   -------------
Board before the Effective Date will automatically be granted an Option for
10,000 Shares on the Effective Date, unless such Outside Director received a
grant of Options before the Effective Date.  Each Outside Director who first
becomes a member of the Board on or after the Effective Date will automatically
be granted an Option for 20,000 Shares on the date such Outside Director first
becomes a member of the Board.  Immediately following each annual meeting of
stockholders, all Outside Directors will automatically be granted an Option for
10,000 Shares, provided the Outside Director is a member of the Board on such
date and has served continuously as a member of the Board for a period of at
least one year since the date when such Outside Director first became a member
of the Board (the "Annual Grant").

              9.4  Vesting.  Each Annual Grant shall be 100% vested and
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immediately exercisable as of the date of grant.

          9.5      Exercise Price.  The exercise price of an Annual Grant shall
                   --------------
be the Fair Market Value of the Shares, at the time that the Option is granted.
<PAGE>

         10.  WITHHOLDING TAXES.
              -----------------

              10.1 Withholding Generally.  Whenever Shares are to be issued in
                   ---------------------
satisfaction of Awards granted under this Plan, the Company may require the
Participant to remit to the Company an amount sufficient to satisfy federal,
state and local withholding tax requirements prior to the delivery of any
certificate or certificates for such Shares.  Whenever, under this Plan,
payments in satisfaction of Awards are to be made in cash, such payment will be
net of an amount sufficient to satisfy federal, state, and local withholding tax
requirements.

              10.2 Stock Withholding.  When, under applicable tax laws, a
                   -----------------
Participant incurs tax liability in connection with the exercise or vesting of
any Award that is subject to tax withholding and the Participant is obligated to
pay the Company the amount required to be withheld, the Committee may in its
sole discretion allow the Participant to satisfy the minimum withholding tax
obligation by electing to have the Company withhold from the Shares to be issued
that number of Shares having a Fair Market Value equal to the minimum amount
required to be withheld, determined on the date that the amount of tax to be
withheld is to be determined.  All elections by a Participant to have Shares
withheld for this purpose will be made in accordance with the requirements
established by the Committee and be in writing in a form acceptable to the
Committee.

         11.  TRANSFERABILITY.
              ---------------

              11.1  Except as otherwise provided in this Section 11, Awards
granted under this Plan, and any interest therein, will not be transferable or
assignable by Participant, and may not be made subject to execution, attachment
or similar process, otherwise than by will or by the laws of descent and
distribution or as determined by the Committee and set forth in the Award
Agreement with respect to Awards that are not ISOs.

              11.2  All Awards other than NQSO's.  All Awards other than NQSO's
                    -----------------------------
shall be exercisable: (i) during the Participant's lifetime, only by (A) the
Participant, or (B) the Participant's guardian or legal representative; and (ii)
after Participant's death, by the legal representative of the Participant's
heirs or legatees.

              11.3  NQSOs.  Unless otherwise restricted by the Committee, an
                    -----
NQSO shall be exercisable: (i) during the Participant's lifetime only by (A) the
Participant, (B) the Participant's guardian or legal representative, (C) a
Family Member of the Participant who has acquired the NQSO by "permitted
transfer;" and (ii) after Participant's death, by the legal representative of
the Participant's heirs or legatees. "Permitted transfer" means, as authorized
by this Plan and the Committee in an NQSO, any transfer effected by the
Participant during the Participant's lifetime of an interest in such NQSO but
only such transfers which are by gift or domestic relations order. A permitted
transfer does not include any transfer for value and neither of the following
are transfers for value: (a) a transfer of under a domestic relations order in
settlement of marital property rights or (b) a transfer to an entity in which
more than fifty percent of the voting interests are owned by Family Members or
the Participant in exchange for an interest in that entity.

         12.  PRIVILEGES OF STOCK OWNERSHIP; RESTRICTIONS ON SHARES..
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<PAGE>

              12.1  Voting and Dividends.  No Participant will have any of
                    --------------------
the rights of a stockholder with respect to any Shares until the Shares are
issued to the Participant.  After Shares are issued to the Participant, the
Participant will be a stockholder and have all the rights of a stockholder with
respect to such Shares, including the right to vote and receive all dividends or
other distributions made or paid with respect to such Shares; provided, that if
                                                              --------
such Shares are Restricted Stock, then any new, additional or different
securities the Participant may become entitled to receive with respect to such
Shares by virtue of a stock dividend, stock split or any other change in the
corporate or capital structure of the Company will be subject to the same
restrictions as the Restricted Stock; provided, further, that the Participant
                                      --------  -------
will have no right to retain such stock dividends or stock distributions with
respect to Shares that are repurchased at the Participant's Purchase Price or
Exercise Price pursuant to Section 12.

              12.2  Financial Statements.  The Company will provide financial
                    --------------------
statements to each Participant prior to such Participant's purchase of Shares
under this Plan, and to each Participant annually during the period such
Participant has Awards outstanding; provided, however, the Company will not be
                                    --------  -------
required to provide such financial statements to Participants whose services in
connection with the Company assure them access to equivalent information.

              12.3  Restrictions on Shares.  At the discretion of the Committee,
                    -----------------------
the Company may reserve to itself and/or its assignee(s) in the Award Agreement
a right to repurchase a portion of or all Unvested Shares held by a Participant
following such Participant's Termination at any time within ninety (90) days
after the later of Participant's Termination Date and the date Participant
purchases Shares under this Plan, for cash and/or cancellation of purchase money
indebtedness, at the Participant's Exercise Price or Purchase Price, as the case
may be.

         13.  CERTIFICATES.  All certificates for Shares or other securities
              ------------
delivered under this Plan will be subject to such stock transfer orders, legends
and other restrictions as the Committee may deem necessary or advisable,
including restrictions under any applicable federal, state or foreign securities
law, or any rules, regulations and other requirements of the SEC or any stock
exchange or automated quotation system upon which the Shares may be listed or
quoted.

         14.  ESCROW; PLEDGE OF SHARES.  To enforce any restrictions on a
              ------------------------
Participant's Shares, the Committee may require the Participant to deposit all
certificates representing Shares, together with stock powers or other
instruments of transfer approved by the Committee, appropriately endorsed in
blank, with the Company or an agent designated by the Company to hold in escrow
until such restrictions have lapsed or terminated, and the Committee may cause a
legend or legends referencing such restrictions to be placed on the
certificates.  Any Participant who is permitted to execute a promissory note as
partial or full consideration for the purchase of Shares under this Plan will be
required to pledge and deposit with the Company all or part of the Shares so
purchased as collateral to secure the payment of Participant's obligation to the
Company under the promissory note; provided, however, that the Committee may
                                   --------  -------
require or accept other or additional forms of collateral to secure the payment
of such obligation and, in any event, the Company will have full recourse
against the Participant under the promissory note notwithstanding any pledge of
the Participant's Shares or other collateral.  In connection with any pledge of
the Shares, Participant will be required to execute and deliver a written pledge
agreement in such form as the Committee will from time to time approve.  The
Shares purchased
<PAGE>

with the promissory note may be released from the pledge on a pro rata basis as
the promissory note is paid.

         15.  EXCHANGE AND BUYOUT OF AWARDS.  The Committee may, at any time or
              -----------------------------
from time to time, authorize the Company, with the consent of the respective
Participants, to issue new Awards in exchange for the surrender and cancellation
of any or all outstanding Awards.  The Committee may at any time buy from a
Participant an Award previously granted with payment in cash, Shares (including
Restricted Stock) or other consideration, based on such terms and conditions as
the Committee and the Participant may agree.

         16.  SECURITIES LAW AND OTHER REGULATORY COMPLIANCE.  An Award will not
              ----------------------------------------------
be effective unless such Award is in compliance with all applicable federal and
state securities laws, rules and regulations of any governmental body, and the
requirements of any stock exchange or automated quotation system upon which the
Shares may then be listed or quoted, as they are in effect on the date of grant
of the Award and also on the date of exercise or other issuance.
Notwithstanding any other provision in this Plan, the Company will have no
obligation to issue or deliver certificates for Shares under this Plan prior to:
(a) obtaining any approvals from governmental agencies that the Company
determines are necessary or advisable; and/or (b) completion of any registration
or other qualification of such Shares under any state or federal law or ruling
of any governmental body that the Company determines to be necessary or
advisable.  The Company will be under no obligation to register the Shares with
the SEC or to effect compliance with the registration, qualification or listing
requirements of any state securities laws, stock exchange or automated quotation
system, and the Company will have no liability for any inability or failure to
do so.

         17.  NO OBLIGATION TO EMPLOY.  Nothing in this Plan or any Award
              -----------------------
granted under this Plan will confer or be deemed to confer on any Participant
any right to continue in the employ of, or to continue any other relationship
with, the Company or any Parent or Subsidiary of the Company or limit in any way
the right of the Company or any Parent or Subsidiary of the Company to terminate
Participant's employment or other relationship at any time, with or without
cause.

         18.  CORPORATE TRANSACTIONS.
              ----------------------

              18.1 Assumption or Replacement of Awards by Successor. In the
                   ------------------------------------------------
event of (a) a dissolution or liquidation of the Company, (b) a merger or
consolidation in which the Company is not the surviving corporation (other than
a merger or consolidation with a wholly-owned subsidiary, a reincorporation of
the Company in a different jurisdiction, or other transaction in which there is
no substantial change in the stockholders of the Company or their relative stock
holdings and the Awards granted under this Plan are assumed, converted or
replaced by the successor corporation, which assumption will be binding on all
Participants), (c) a merger in which the Company is the surviving corporation
but after which the stockholders of the Company immediately prior to such merger
(other than any stockholder that merges, or which owns or controls another
corporation that merges, with the Company in such merger) cease to own their
shares or other equity interest in the Company, (d) the sale of substantially
all of the assets of the Company, or (e) the acquisition, sale, or transfer of
more than 50% of the outstanding shares of the Company by tender offer or
similar transaction, any or all outstanding Awards may be assumed, converted or
replaced by the successor corporation (if any), which
<PAGE>

assumption, conversion or replacement will be binding on all Participants. In
the alternative, the successor corporation may substitute equivalent Awards or
provide substantially similar consideration to Participants as was provided to
stockholders (after taking into account the existing provisions of the Awards).
The successor corporation may also issue, in place of outstanding Shares of the
Company held by the Participants, substantially similar shares or other property
subject to repurchase restrictions no less favorable to the Participant. In the
event such successor corporation (if any) refuses to assume or substitute
Awards, as provided above, pursuant to a transaction described in this
Subsection 18.1, such Awards will expire on such transaction at such time and on
such conditions as the Committee will determine. Notwithstanding anything in
this Plan to the contrary, the Committee may, in its sole discretion, provide
that the vesting of any or all Awards granted pursuant to this Plan will
accelerate upon a transaction described in this Section 18. If the Committee
exercises such discretion with respect to Options, such Options will become
exercisable in full prior to the consummation of such event at such time and on
such conditions as the Committee determines, and if such Options are not
exercised prior to the consummation of the corporate transaction, they shall
terminate at such time as determined by the Committee.

              18.2  Other Treatment of Awards.  Subject to any greater rights
                    -------------------------
granted to Participants under the foregoing provisions of this Section 18, in
the event of the occurrence of any transaction described in Section 18.1, any
outstanding Awards will be treated as provided in the applicable agreement or
plan of merger, consolidation, dissolution, liquidation, or sale of assets.

              18.3  Assumption of Awards by the Company.  The Company, from time
                    -----------------------------------
to time, also may substitute or assume outstanding awards granted by another
company, whether in connection with an acquisition of such other company or
otherwise, by either; (a) granting an Award under this Plan in substitution of
such other company's award; or (b) assuming such award as if it had been granted
under this Plan if the terms of such assumed award could be applied to an Award
granted under this Plan.  Such substitution or assumption will be permissible if
the holder of the substituted or assumed award would have been eligible to be
granted an Award under this Plan if the other company had applied the rules of
this Plan to such grant.  In the event the Company assumes an award granted by
another company, the terms and conditions of such award will remain unchanged
(except that the exercise price and the number and nature of Shares issuable
-------
upon exercise of any such option will be adjusted appropriately pursuant to
Section 424(a) of the Code).  In the event the Company elects to grant a new
Option rather than assuming an existing option, such new Option may be granted
with a similarly adjusted Exercise Price.

         19.  ADOPTION AND STOCKHOLDER APPROVAL.  This Plan will become
              ---------------------------------
effective on the date on which the registration statement filed by the Company
with the SEC under the Securities Act registering the initial public offering of
the Company's Common Stock is declared effective by the SEC (the "Effective
Date").  This Plan shall be approved by the stockholders of the Company
(excluding Shares issued pursuant to this Plan), consistent with applicable
laws, within twelve (12) months before or after the date this Plan is adopted by
the Board.  Upon the Effective Date, the Committee may grant Awards pursuant to
this Plan; provided, however, that: (a) no Option may be exercised prior to
           --------  -------
initial stockholder approval of this Plan; (b) no Option granted pursuant to an
increase in the number of Shares subject to this Plan approved by the Board will
be exercised prior to the time such increase has been approved by the
stockholders of the Company; (c) in the event that initial stockholder approval
is not
<PAGE>

obtained within the time period provided herein, all Awards granted hereunder
shall be cancelled, any Shares issued pursuant to any Awards shall be cancelled
and any purchase of Shares issued hereunder shall be rescinded; and (d) in the
event that stockholder approval of such increase is not obtained within the time
period provided herein, all Awards granted pursuant to such increase will be
cancelled, any Shares issued pursuant to any Award granted pursuant to such
increase will be cancelled, and any purchase of Shares pursuant to such increase
will be rescinded.

         20.  TERM OF PLAN/GOVERNING LAW.  Unless earlier terminated as provided
              --------------------------
herein, this Plan will terminate ten (10) years from the date this Plan is
adopted by the Board or, if earlier, the date of stockholder approval.  This
Plan and all agreements thereunder shall be governed by and construed in
accordance with the laws of the State of California.

         21.  AMENDMENT OR TERMINATION OF PLAN.  The Board may at any time
              --------------------------------
terminate or amend this Plan in any respect, including without limitation
amendment of any form of Award Agreement or instrument to be executed pursuant
to this Plan; provided, however, that the Board will not, without the approval
              --------  -------
of the stockholders of the Company, amend this Plan in any manner that requires
such stockholder approval.

         22.  NONEXCLUSIVITY OF THE PLAN.  Neither the adoption of this Plan by
              --------------------------
the Board, the submission of this Plan to the stockholders of the Company for
approval, nor any provision of this Plan will be construed as creating any
limitations on the power of the Board to adopt such additional compensation
arrangements as it may deem desirable, including, without limitation, the
granting of stock options and bonuses otherwise than under this Plan, and such
arrangements may be either generally applicable or applicable only in specific
cases.

         23.  DEFINITIONS.  As used in this Plan, the following terms will have
              -----------
the following meanings:

              "Award" means any award under this Plan, including any Option,
Restricted Stock or Stock Bonus.

              "Award Agreement" means, with respect to each Award, the signed
written agreement between the Company and the Participant setting forth the
terms and conditions of the Award.

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

              "Cause" means the commission of an act of theft, embezzlement,
fraud, dishonesty or a breach of fiduciary duty to the Company or a Parent or
Subsidiary of the Company.

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

              "Committee" means the Compensation Committee of the Board.

              "Company" means Interwoven, Inc. or any successor corporation.
<PAGE>

              "Disability" means a disability, whether temporary or permanent,
partial or total, as determined by the Committee.

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

              "Exercise Price" means the price at which a holder of an Option
may purchase the Shares issuable upon exercise of the Option.

              "Fair Market Value" means, as of any date, the value of a share of
the Company's  Common Stock determined as follows:

         (a)  if such Common Stock is then quoted on the Nasdaq National Market,
              its closing price on the Nasdaq National Market on the date of
              determination as reported in The Wall Street Journal;
                                           -----------------------

         (b)  if such Common Stock is publicly traded and is then listed on a
              national securities exchange, its closing price on the date of
              determination on the principal national securities exchange on
              which the Common Stock is listed or admitted to trading as
              reported in The Wall Street Journal;
                          -----------------------

         (c)  if such Common Stock is publicly traded but is not quoted on the
              Nasdaq National Market nor listed or admitted to trading on a
              national securities exchange, the average of the closing bid and
              asked prices on the date of determination as reported in The Wall
                                                                       --------
              Street Journal;
              --------------

         (d)  in the case of an Award made on the Effective Date, the price per
              share at which shares of the Company's Common Stock are initially
              offered for sale to the public by the Company's underwriters in
              the initial public offering of the Company's Common Stock pursuant
              to a registration statement filed with the SEC under the
              Securities Act;  or

         (e)  if none of the foregoing is applicable, by the Committee in good
              faith.

              "Family Member" includes any of the following:

         (a)  child, stepchild, grandchild, parent, stepparent, grandparent,
              spouse, former spouse, sibling, niece, nephew, mother-in-law,
              father-in-law, son-in-law, daughter-in-law, brother-in-law, or
              sister-in-law of the Participant, including any such person with
              such relationship to the Participant by adoption;

         (b)  any person (other than a tenant or employee) sharing the
              Participant's household;

         (c)  a trust in which the persons in (a) and (b) have more than fifty
              percent of the beneficial interest;

         (d)  a foundation in which the persons in (a) and (b) or the
              Participant control the management of assets; or
<PAGE>

         (e)  any other entity in which the persons in (a) and (b) or the
              Participant own more than fifty percent of the voting interest.

              "Insider" means an officer or director of the Company or any other
person whose transactions in the Company's Common Stock are subject to Section
16 of the Exchange Act.

              "Option" means an award of an option to purchase Shares pursuant
to Section 5.

              "Outside Director" means a member of the Board who is not an
employee of the Company or any Parent, Subsidiary or Affiliate of the Company.

              "Parent" means any corporation (other than the Company) in an
unbroken chain of corporations ending with the Company if each of such
corporations other than the Company owns stock possessing 50% or more of the
total combined voting power of all classes of stock in one of the other
corporations in such chain.

              "Participant" means a person who receives an Award under this
Plan.

              "Performance Factors" means the factors selected by the Committee
from among the following measures to determine whether the performance goals
established by the Committee and applicable to Awards have been satisfied:

              (a) Net revenue and/or net revenue growth;

              (b) Earnings before income taxes and amortization and/or earnings
before
                  income taxes and amortization growth;

              (c) Operating income and/or operating income growth;

              (d) Net income and/or net income growth;

              (e) Earnings per share and/or earnings per share growth;

              (f) Total stockholder return and/or total stockholder return
growth;

              (g) Return on equity;

              (h) Operating cash flow return on income;

              (i) Adjusted operating cash flow return on income;

              (j) Economic value added; and

              (k) Individual confidential business objectives.
<PAGE>

              "Performance Period" means the period of service determined by the
Committee, not to exceed five years, during which years of service or
performance is to be measured for Restricted Stock Awards or Stock Bonuses.

              "Plan" means this Interwoven, Inc. 1999 Equity Incentive Plan, as
amended from time to time.

              "Restricted Stock Award" means an award of Shares pursuant to
Section 6.

              "SEC" means the Securities and Exchange Commission.

              "Securities Act" means the Securities Act of 1933, as amended.

              "Shares" means shares of the Company's Common Stock reserved for
issuance under this Plan, as adjusted pursuant to Sections 2 and 18, and any
successor security.

              "Stock Bonus" means an award of Shares, or cash in lieu of Shares,
pursuant to Section 7.

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

              "Termination" or "Terminated" means, for purposes of this Plan
with respect to a Participant, that the Participant has for any reason ceased to
provide services as an employee, officer, director, consultant, independent
contractor, or advisor to the Company or a Parent or Subsidiary of the Company.
An employee will not be deemed to have ceased to provide services in the case of
(i) sick leave, (ii) military leave, or (iii) any other leave of absence
approved by the Committee, provided, that such leave is for a period of not more
than 90 days, unless reemployment upon the expiration of such leave is
guaranteed by contract or statute or unless provided otherwise pursuant to
formal policy adopted from time to time by the Company and issued and
promulgated to employees in writing. In the case of any employee on an approved
leave of absence, the Committee may make such provisions respecting suspension
of vesting of the Award while on leave from the employ of the Company or a
Subsidiary as it may deem appropriate, except that in no event may an Option be
exercised after the expiration of the term set forth in the Option agreement.
The Committee will have sole discretion to determine whether a Participant has
ceased to provide services and the effective date on which the Participant
ceased to provide services (the "Termination Date").

              "Unvested Shares" means "Unvested Shares" as defined in the Award
Agreement.

              "Vested Shares" means "Vested Shares" as defined in the Award
Agreement.