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                            BLUESTAR PROPERTIES, INC.
                      1999 STOCK OPTION/STOCK ISSUANCE PLAN

                                  ARTICLE ONE

                               GENERAL PROVISIONS

    I. PURPOSE OF THE PLAN

         This 1999 Stock Option/Stock Issuance Plan is intended to promote the
interests of BlueStar Properties, Inc., a Delaware corporation, by providing
eligible persons in the Corporation's employ or service with the opportunity to
acquire a proprietary interest, or otherwise increase their proprietary
interest, in the Corporation as an incentive for them to continue in such employ
or service.

         Capitalized terms shall have the meanings assigned to such terms in the
attached Appendix.

    II. STRUCTURE OF THE PLAN

         A. The Plan shall be divided into two (2) separate equity programs:

                  (i) the Option Grant Program under which eligible persons may,
    at the discretion of the Plan Administrator, be granted options to
    purchase shares of Common Stock, and

                  (ii) the Stock Issuance Program under which eligible persons
    may, at the discretion of the Plan Administrator, be issued shares of Common
    Stock directly, either through the immediate purchase of such shares or as a
    bonus for services rendered the Corporation (or any Parent or Subsidiary).

         B. The provisions of Articles One and Four shall apply to both equity
programs under the Plan and shall accordingly govern the interests of all
persons under the Plan.

    III. ADMINISTRATION OF THE PLAN

         A. The Plan shall be administered by the Board. However, any or all
administrative functions otherwise exercisable by the Board may be delegated to
the Committee. Members of the Committee shall serve for such period of time as
the Board may determine and shall be subject to removal by the Board at any
time. The Board may also at any time terminate the functions of the Committee
and reassume all powers and authority previously delegated to the Committee.

         B. The Plan Administrator shall 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 Plan and any
outstanding options or stock issuances thereunder as it may



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deem necessary or advisable. Decisions of the Plan Administrator shall be final
and binding on all parties who have an interest in the Plan or any option or
stock issuance thereunder.

    IV. ELIGIBILITY

         A. The persons eligible to participate in the Plan are as follows:

                  (i) Employees,

                  (ii) non-employee members of the Board or the non-employee
    members of the board of directors of any Parent or Subsidiary, and

                  (iii) consultants and other independent advisors who provide
    services to the Corporation (or any Parent or Subsidiary).

         B. The Plan Administrator shall have full authority to determine, (i)
with respect to the grants made under the Option Grant Program, which eligible
persons are to receive the option grants, the time or times when those grants
are to be made, the number of shares to be covered by each such grant, the
status of the granted option as either an Incentive Option or a Non-Statutory
Option, 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 and (ii) with respect to stock issuances
made under the Stock Issuance Program, which eligible persons are to receive
stock issuances, the time or times when those issuances are to be made, the
number of shares to be issued to each Participant, the vesting schedule (if any)
applicable to the issued shares and the consideration to be paid by the
Participant for such shares.

         C. The Plan Administrator shall have the absolute discretion either to
grant options in accordance with the Option Grant Program or to effect stock
issuances in accordance with the Stock Issuance Program.

    V. STOCK SUBJECT TO THE PLAN

         A. The stock issuable under the Plan shall be shares of authorized but
unissued or reacquired Common Stock. The maximum number of shares of Common
Stock which may be issued over the term of the Plan shall be 7,615,5001 shares.
Such share reserve is comprised of (i) the number of shares which remained
available for issuance, as of the Plan Effective Date, under the Predecessor
Plan, including shares subject to the outstanding options incorporated into this
plan and any other shares which would have been available for future option
grant under the Predecessor Plan (5,965,500 shares in the aggregate) and (ii) an
increase of 1,650,000 shares adopted by the Board and approved by the
stockholders in October 1999.

         B. Shares of Common Stock subject to outstanding options (including any
options incorporated from the Predecessor Plan) shall be available for
subsequent issuance under

---------------------
(1) Reflects the stock split effected by the Corporation on October 26, 1999
    through a 2-for-1 stock dividend.


                                       2.

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the Plan to the extent (i) the 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 (including shares issued upon exercise of options incorporated from the
Predecessor Plan) and subsequently repurchased by the Corporation, at the option
exercise or direct 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 or direct
stock issuances under the Plan.

         C. Should any change be 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 to (i) the maximum number and/or class of securities issuable under the
Plan and (ii) the number and/or class of securities and the exercise price per
share in effect under each outstanding option (including any option incorporated
from the Predecessor Plan) in order to prevent the dilution or enlargement of
benefits thereunder. The adjustments determined by the Plan Administrator shall
be final, binding and conclusive. In no event shall any such adjustments be made
in connection with the conversion of one or more outstanding shares of the
Corporation's preferred stock into shares of Common Stock.




                                       3.
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                                  ARTICLE TWO

                              OPTION GRANT PROGRAM

     I. OPTION TERMS

         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. Each document evidencing an
Incentive Option shall, in addition, be subject to the provisions of the Plan
applicable to such options.

         A. EXERCISE PRICE.

                  1. The exercise price per share shall be fixed by the Plan
Administrator and may be less than, equal to or greater than 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 Four and the documents evidencing the option, be payable in cash or
check made payable to the Corporation. Should the Common Stock be registered
under Section 12 of the 1934 Act at the time the option is exercised, then the
exercise price may also be paid as follows:


                     (i) in 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

                     (ii) 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
         (a) to 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 Federal, state and local income and employment
         taxes required to be withheld by the Corporation by reason of such
         exercise and (b) to 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 grant. 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. Unless otherwise provided by the Plan Administrator at the
 time an option is granted and recorded in the agreements evidencing the option,
the following provisions shall govern the exercise of any options held by the
Optionee at the time of his or her cessation of Service:

                     (i) Should the Optionee cease to remain in Service for any
      reason other than death, Permanent Disability or Misconduct, then the
      Optionee shall have a period of three (3) months following the date of
      such cessation of Service during which to exercise each outstanding
      option held by such Optionee. During such 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 three (3)-month period, 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 with respect to any and all option shares for
      which the option is not otherwise at the time exercisable or in which the
      Optionee is not otherwise at that time vested.

                     (ii) Should the Optionee's Service terminate by reason of
      Optionee's death, then, as of the effective date of the Optionee's
      termination of Service, the shares subject to the Optionee's outstanding
      options which are unvested as of such date shall immediately accelerate
      in full, and the Corporation's repurchase rights with respect to such
      unvested shares shall immediately terminate, so that each such option
      shall become exercisable for all of the option shares as fully vested
      shares of Common Stock. The personal representative of the Optionee's
      estate or the person or persons to whom the option is transferred
      pursuant to the Optionee's will or the laws of inheritance shall have a
      twelve (12)-month period following the date of the Optionee's death
      during which to exercise such option. Upon the expiration of the twelve
      (12)-month period, the option shall terminate and cease to be outstanding
      for any option shares for which the option has not been exercised.

                     (iii) Should the Optionee's Service terminate by reason of
      Permanent Disability, then, as of the effective date of the Optionee's
      termination of Service, the shares subject to the Optionee's
      outstanding options which are unvested as of such date shall immediately
      accelerate in full, and the Corporation's repurchase rights with respect
      to such unvested shares shall immediately terminate, so that each such
      option shall become exercisable for all of the option shares as fully
      vested shares of Common Stock. The Optionee shall have a period of twelve
      (12) months following the date of such cessation of Service during which
      to exercise such option. Upon the expiration of the twelve (12)-month
      period, the option shall terminate and cease to be outstanding for any
      option shares for which the option has not been exercised.



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                     (iv) Under no circumstances, however, shall any option be
      exercisable after the specified expiration of the option term.


                     (v) Should the Optionee's Service be terminated for
      Misconduct, then all outstanding options held by the Optionee shall
      terminate immediately and cease to remain outstanding.


         2. The Plan Administrator shall have the 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 or
      death from the limited 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 under the option had the Optionee continued in Service.

         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 the
recordholder 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 to repurchase, at the exercise price paid per
share, any or all of those unvested shares. 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. FIRST REFUSAL RIGHTS. Until such time as the Common Stock is first
registered under Section 12 of the 1934 Act, the Corporation shall have the
right of first refusal with respect to any proposed disposition by the Optionee
(or any successor in interest) of any shares of Common Stock issued under the
Option Grant Program. Such right of first refusal shall be exercisable in
accordance with the terms established by the Plan Administrator and set forth in
the document evidencing such right.

         G. LIMITED TRANSFERABILITY OF OPTIONS. During the lifetime of the
Optionee, Incentive Options shall be exercisable only by the Optionee and shall
not be assignable or transferable other than by will or by the laws of descent
and distribution following the Optionee's death. Non-Statutory Options shall be
subject to the same restrictions, except that a Non-Statutory Option may, to the
extent permitted by the Plan Administrator, be assigned in whole or in part
during the Optionee's lifetime (i) as a gift to one or more members of the



                                       6.

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Optionee's immediate family, to a trust in which Optionee and/or one or more
such family members hold more than fifty percent (50%) of the beneficial
interest or to an entity in which more than fifty percent (50%) of the voting
interests are owned by one or more such family members or (ii) pursuant to a
domestic relations order. 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.

         H. WITHHOLDING. The Corporation's obligation to deliver shares of
Common Stock upon the exercise of any options granted under the Plan shall be
subject to the satisfaction of all applicable Federal, state and local income
and employment tax withholding requirements.

    II. INCENTIVE OPTIONS

         The terms specified below shall be applicable to all Incentive Options.
Except as modified by the provisions of this Section II, all the provisions of
Articles One, Two and Four shall be applicable to Incentive Options. Options
which are specifically designated as Non-Statutory Options shall not be subject
to the terms of this Section II.

         A. ELIGIBILITY. Incentive Options may only be granted to Employees.

         B. EXERCISE PRICE. The exercise price per share shall not be less than
one hundred percent (100%) of the Fair Market Value per share of Common Stock on
the option grant date.

         C. DOLLAR LIMITATION. The aggregate Fair Market Value of the shares of
Common Stock (determined as of the respective date or dates of grant) for which
one or more options granted to any Employee under the Plan (or any other option
plan of the Corporation or any Parent or Subsidiary) may for the first time
become exercisable as Incentive Options during any one (1) calendar year shall
not exceed the sum of One Hundred Thousand Dollars ($100,000). To the extent the
Employee holds two (2) or more such options which become exercisable for the
first time in the same calendar year, the foregoing limitation on the
exercisability of such options as Incentive Options shall be applied on the
basis of the order in which such options are granted.

         D. 10% STOCKHOLDER. If any Employee to whom an Incentive Option is
granted is a 10% Stockholder, then the exercise price per share shall not be
less than one hundred ten percent (110%) of the Fair Market Value per share of
Common Stock on the option grant date and the option term shall not exceed five
(5) years measured from the option grant date.

    III. CORPORATE TRANSACTION

         A. The shares subject to each option outstanding under the Plan at the
time of a Corporate Transaction shall automatically vest in full so that each
such option shall, immediately prior to the effective date of the Corporate
Transaction, become fully exercisable for all of the shares of Common Stock at
the time subject to that option and may be exercised for any or all of those
shares as fully-vested shares of Common Stock. However, the shares subject to an
outstanding option shall NOT vest on such an accelerated basis if and to the
extent: (i) such



                                       7.

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option is assumed by the successor corporation (or parent thereof) in the
Corporate Transaction and the Corporation's repurchase rights with respect to
the unvested option shares are concurrently assigned to such successor
corporation (or parent thereof) or (ii) such option is to be replaced with a
cash incentive program of the successor corporation which preserves the spread
existing on the unvested option shares at the time of the Corporate Transaction
and provides for subsequent payout in accordance with the same vesting schedule
applicable to those unvested option shares or (iii) the acceleration of such
option is subject to other limitations imposed by the Plan Administrator at the
time of the option grant.

         B. All outstanding repurchase rights shall also terminate
automatically, and the shares of Common Stock subject to those terminated rights
shall immediately vest in full, in the event of any Corporate Transaction,
except to the extent: (i) those repurchase rights are assigned to the successor
corporation (or parent thereof) in connection with such Corporate Transaction or
(ii) such accelerated vesting is precluded by other limitations imposed by the
Plan Administrator at the time the repurchase right is issued.

         C. Immediately following the consummation of the Corporate Transaction,
all outstanding options shall terminate and cease to be outstanding, except to
the extent assumed by the successor corporation (or parent thereof).

         D. Each option which is assumed in connection with a Corporate
Transaction shall be appropriately adjusted, immediately after such Corporate
Transaction, to apply to the number and class of securities which would have
been issuable to the Optionee in consummation of such Corporate Transaction, had
the option been exercised immediately prior to such Corporate Transaction.
Appropriate adjustments shall also be made to (i) the number and class of
securities available for issuance under the Plan following the consummation of
such Corporate Transaction and (ii) the exercise price payable per share under
each outstanding option, provided the aggregate exercise price payable for such
securities shall remain the same.

         E. The Plan Administrator shall have the discretion, exercisable either
at the time the option is granted or at any time while the option remains
outstanding, to provide for the automatic acceleration (in whole or in part) of
one or more outstanding options (and the immediate termination of the
Corporation's repurchase rights with respect to the shares subject to those
options) upon the occurrence of a Corporate Transaction, whether or not those
options are to be assumed in the Corporate Transaction.

         F. The Plan Administrator shall also have full power and authority,
exercisable either at the time the option is granted or at any time while the
option remains outstanding, to structure such option so that the shares subject
to that option will automatically vest on an accelerated basis should the
Optionee's Service terminate by reason of an Involuntary Termination within a
designated period (not to exceed eighteen (18) months) following the effective
date of any Corporate Transaction in which the option is assumed and the
repurchase rights applicable to those shares do not otherwise terminate. Any
option so accelerated shall remain exercisable for the fully-vested option
shares until the earlier of (i) the expiration of the option term or (ii) the
expiration of the one (1)-year period measured from the effective date of the
Involuntary Termination. In addition, the Plan Administrator may provide that
one or more of the Corporation's outstanding repurchase rights with respect to
shares held by the Optionee at




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the time of such Involuntary Termination shall immediately terminate on an
accelerated basis, and the shares subject to those terminated rights shall
accordingly vest at that time.

         G. The portion of any Incentive Option accelerated in connection with a
Corporate Transaction shall remain exercisable as an Incentive Option only to
the extent the applicable One Hundred Thousand Dollar limitation is not
exceeded. To the extent such dollar limitation is exceeded, the accelerated
portion of such option shall be exercisable as a Non-Statutory Option under the
Federal tax laws.

         H. The grant of options under the Plan 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.

     IV. CANCELLATION AND REGRANT OF OPTIONS

         The Plan Administrator shall have the authority to effect, at any time
and from time to time, with the consent of the affected option holders, the
cancellation of any or all outstanding options under the Option Grant Program
(including options incorporated from the Predecessor Plan) and to grant in
substitution new options covering the same or different number of shares of
Common Stock but with an exercise price per share based on the Fair Market Value
per share of Common Stock on the new grant date.




                                       9.

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                                 ARTICLE THREE

                             STOCK ISSUANCE PROGRAM

     I. STOCK ISSUANCE TERMS

         Shares of Common Stock may be issued under the Stock Issuance Program
through direct and immediate issuances without any intervening option grants.
Each such stock issuance shall be evidenced by a Stock Issuance Agreement which
complies with the terms specified below.

         A. PURCHASE PRICE.

                  1. The purchase price per share shall be fixed by the Plan
Administrator and may be less than, equal to or greater than the Fair Market
Value per share of Common Stock on the issue date.

                  2. Subject to the provisions of Section I of Article Four,
shares of Common Stock may be issued under the Stock Issuance Program for any of
the following items of consideration which the Plan Administrator may deem
appropriate in each individual instance:

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

                     (ii) past services rendered to the Corporation (or
     any Parent or Subsidiary).

         B. VESTING PROVISIONS.

                  1. Shares of Common Stock issued under the Stock Issuance
Program may, in the discretion of the Plan Administrator, be fully and
immediately vested upon issuance or may vest in one or more installments over
the Participant's period of Service or upon attainment of specified performance
objectives.

                  2. Any new, substituted or additional securities or other
property (including money paid other than as a regular cash dividend) which the
Participant may have the right to receive with respect to the Participant's
unvested shares of Common Stock by reason of any stock dividend, stock split,
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 shall be issued subject to (i) the same vesting
requirements applicable to the Participant's unvested shares of Common Stock and
(ii) such escrow arrangements as the Plan Administrator shall deem appropriate.

                  3. The Participant shall have full stockholder rights with
respect to any shares of Common Stock issued to the Participant under the Stock
Issuance Program, whether or not the Participant's interest in those shares is
vested. Accordingly, the Participant shall have the right to vote such shares
and to receive any regular cash dividends paid on such shares.



                                      10.
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                  4. Should the Participant cease to remain in Service while
holding one or more unvested shares of Common Stock issued under the Stock
Issuance Program or should the performance objectives not be attained with
respect to one or more such unvested shares of Common Stock, then those shares
shall be immediately surrendered to the Corporation for cancellation, and the
Participant shall have no further stockholder rights with respect to those
shares. To the extent the surrendered shares were previously issued to the
Participant for consideration paid in cash or cash equivalent (including the
Participant's purchase-money indebtedness), the Corporation shall repay to the
Participant the cash consideration paid for the surrendered shares and shall
cancel the unpaid principal balance of any outstanding purchase-money note of
the Participant attributable to the surrendered shares.


                  5. The Plan Administrator may in its discretion waive the
surrender and cancellation of one or more unvested shares of Common Stock (or
other assets attributable thereto) which would otherwise occur upon the
non-completion of the vesting schedule applicable to such shares. Such waiver
shall result in the immediate vesting of the Participant's interest in the
shares of Common Stock as to which the waiver applies. Such waiver may be
effected at any time, whether before or after the Participant's cessation of
Service or the attainment or non-attainment of the applicable performance
objectives.

         C. FIRST REFUSAL RIGHTS. Until such time as the Common Stock is first
registered under Section 12 of the 1934 Act, the Corporation shall have the
right of first refusal with respect to any proposed disposition by the
Participant (or any successor in interest) of any shares of Common Stock issued
under the Stock Issuance Program. Such right of first refusal shall be
exercisable in accordance with the terms established by the Plan Administrator
and set forth in the document evidencing such right.

     II. CORPORATE TRANSACTION

         A. All of the outstanding repurchase rights under the Stock Issuance
Program shall terminate automatically, and all the shares of Common Stock
subject to those terminated rights shall immediately vest in full, in the event
of any Corporate Transaction, except to the extent: (i) those repurchase rights
are assigned to the successor corporation (or parent thereof) in connection with
such Corporate Transaction or (ii) such accelerated vesting is precluded by
other limitations imposed by the Plan Administrator at the time the repurchase
right is issued.

         B. The Plan Administrator shall have the discretionary authority,
exercisable either at the time the unvested shares are issued or any time while
the Corporation's repurchase rights with respect to those shares remain
outstanding, to provide that those rights shall automatically terminate on an
accelerated basis, and the shares of Common Stock subject to those terminated
rights shall immediately vest, in the event the Participant's Service should
subsequently terminate by reason of an Involuntary Termination within a
designated period (not to exceed eighteen (18) months) following the effective
date of any Corporate Transaction in which those repurchase rights are assigned
to the successor corporation (or parent thereof).



                                      11.

<PAGE>   12




     III. SHARE ESCROW/LEGENDS

         Unvested shares may, in the Plan Administrator's discretion, be held in
escrow by the Corporation until the Participant's interest in such shares vests
or may be issued directly to the Participant with restrictive legends on the
certificates evidencing those unvested shares.



                                      12.
<PAGE>   13


                                  ARTICLE FOUR

                                  MISCELLANEOUS

     I. FINANCING

         The Plan Administrator may permit any Optionee (including the holder of
an option granted under the Predecessor Plan) or Participant to pay the option
exercise price under the Option Grant Program or the purchase price for shares
issued under the Stock Issuance program by delivering a full recourse, interest
bearing promissory note payable in one or more installments and secured by the
purchased shares. The terms of any such promissory note (including the interest
rate and the terms of repayment) shall be established by the Plan Administrator
in its sole discretion. In no event shall the maximum credit available to the
Optionee or Participant exceed the sum of (i) the aggregate option exercise
price or purchase price payable for the purchased shares plus (ii) any Federal,
state and local income and employment tax liability incurred by the Optionee or
the Participant in connection with the option exercise or share purchase.

     II. EFFECTIVE DATE AND TERM OF THE PLAN

         A. The Plan shall become effective when adopted by the Board, but no
option granted under the Plan may be exercised, and no shares shall be issued
under the Plan, until the Plan is approved by the Corporation's stockholders. If
such stockholder approval is not obtained within twelve (12) months after the
date of the Board's adoption of the Plan, then all options previously granted
under the Plan shall terminate and cease to be outstanding, and no further
options shall be granted and no shares shall be issued under the Plan. Subject
to such limitation, the Plan Administrator may grant options and issue shares
under the Plan at any time after the effective date of the Plan and before the
date fixed herein for termination of the Plan.

         B. The Plan shall serve as the successor to the Predecessor Plan, and
no further option grants or other stock awards shall be made under the
Predecessor Plan after the Plan Effective Date. All options outstanding under
the Predecessor Plan on the Plan Effective Date shall be incorporated into the
Plan at that time and shall be treated as outstanding options under the Plan.
However, each outstanding option so incorporated shall continue to be governed
solely by the terms of the documents evidencing such option, and no provision of
the Plan shall be deemed to affect or otherwise modify the rights or obligations
of the holders of such incorporated options with respect to their acquisition of
shares of Common Stock.

         C. One or more provisions of the Plan, including (without limitation)
the option/vesting acceleration provisions of Article Two relating to Corporate
Transactions, may, in the Plan Administrator's discretion, be extended to one or
more options incorporated from the Predecessor Plan which do not otherwise
contain such provisions.

         D. The Plan shall terminate upon the earliest of (i) the expiration of
the ten (10)-year period measured from the Plan Effective Date, (ii) the date on
which all shares available for issuance under the Plan shall have been issued as
fully-vested shares or (iii) the termination of all outstanding options in
connection with an Corporate Transaction. All options



                                      13.
<PAGE>   14

and unvested stock issuances outstanding at the time of a clause (i) termination
event shall continue to have full force and effect in accordance with the
provisions of the documents evidencing such options or issuances.

     III. AMENDMENT OF THE PLAN

         A. 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 any rights and obligations with respect to
options or unvested stock issuances at the time outstanding under the Plan,
unless the Optionee or the Participant consents to such amendment or
modification. In addition, certain amendments may require stockholder approval
pursuant to applicable laws or regulations.

         B. Options to purchase shares of Common Stock may be granted under the
Option Grant Program and shares of Common Stock may be issued under the Stock
Issuance Program which are in each instance in excess of the number of shares
then available for issuance under the Plan, provided any excess shares actually
issued under those programs shall be held in escrow until there is obtained
stockholder approval of an amendment sufficiently increasing the number of
shares of Common Stock available for issuance under the Plan. If such
stockholder approval is not obtained within twelve (12) months after the date
the first such excess grants or issuances are made, then (i) any unexercised
options granted on the basis of such excess shares shall terminate and cease to
be outstanding and (ii) the Corporation shall promptly refund to the Optionees
and the Participants the exercise or purchase price paid for any excess shares
issued under the Plan and held in escrow, together with interest (at the
applicable Short-Term Federal Rate) for the period the shares were held in
escrow, and such shares shall thereupon be automatically cancelled and cease to
be outstanding.

     IV. 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.

     V. WITHHOLDING

         The Corporation's obligation to deliver shares of Common Stock upon the
exercise of any options or upon the issuance or vesting of any shares issued
under the Plan shall be subject to the satisfaction of all applicable Federal,
state and local income and employment tax withholding requirements.

     VI. REGULATORY APPROVALS

         The implementation of the Plan, the granting of any option under the
Plan and the issuance of any shares of Common Stock (i) upon the exercise of any
option or (ii) under the Stock Issuance Program shall be subject to the
Corporation's procurement of all approvals and permits required by regulatory
authorities having jurisdiction over the Plan, the options granted under it and
the shares of Common Stock issued pursuant to it.




                                      14.
<PAGE>   15






     VII. NO EMPLOYMENT OR SERVICE RIGHTS

         Nothing in the Plan shall confer upon the Optionee or the Participant
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 or the Participant, which rights are hereby expressly reserved by each,
to terminate such person's Service at any time for any reason, with or without
cause.






                                      15.

<PAGE>   16


                                    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 Internal Revenue Code of 1986, as amended.

         C. COMMITTEE shall mean a committee of one (1) or more Board members
appointed by the Board to exercise one or more administrative functions under
the Plan.

         D. COMMON STOCK shall mean the Corporation's common stock.

         E. CORPORATE TRANSACTION shall mean either of the following
stockholder-approved transactions to which the Corporation is a party:

                  (i) a merger or consolidation in which securities possessing
    more than fifty percent (50%) of the total combined voting power of the
    Corporation's outstanding securities are transferred to a person or persons
    different from the persons holding those 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.

         F. CORPORATION shall mean BlueStar Properties, Inc., a Delaware
corporation, and any successor corporation to all or substantially all of the
assets or voting stock of BlueStar Properties, Inc. which shall by appropriate
action adopt the Plan.

         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 closing selling
    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. If there is no closing selling price for the Common Stock
    on the date in question, then the Fair Market Value shall be the closing
    selling price on the last preceding date for which such quotation exists.



                                      A-1.
<PAGE>   17

                  (ii) If the Common Stock is at the time listed on any Stock
    Exchange, then the Fair Market Value shall be the closing selling 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. If there is no closing selling price for
    the Common Stock on the date in question, then the Fair Market Value shall
    be the closing selling price on the last preceding date for which such
    quotation exists.

                  (iii) If the Common Stock is at the time neither listed on any
    Stock Exchange nor traded on the Nasdaq National Market, then the Fair
    Market Value shall be determined by the Plan Administrator after taking into
    account such factors as the Plan Administrator shall deem appropriate.

         J. INCENTIVE OPTION shall mean an option which satisfies the
requirements of Code Section 422.

         K. 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 bonuses 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 without the individual's consent.

         L. MISCONDUCT shall mean the commission of any act of fraud,
embezzlement or dishonesty by the Optionee or Participant, 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 be deemed to be inclusive of all the acts or omissions which the
Corporation (or any Parent or Subsidiary) may consider as grounds for the
dismissal or discharge of any Optionee, Participant or other person in the
Service of the Corporation (or any Parent or Subsidiary).

         M. 1934 ACT shall mean the Securities Exchange Act of 1934, as amended.

         N. NON-STATUTORY OPTION shall mean an option not intended to satisfy
the requirements of Code Section 422.




                                      A-2.
<PAGE>   18

         O. OPTION GRANT PROGRAM shall mean the option grant program in effect
under the Plan.

         P. OPTIONEE shall mean any person to whom an option is granted under
the Option Grant Program.

         Q. 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.

         R. PARTICIPANT shall mean any person who is issued shares of Common
Stock under the Stock Issuance Program.

         S. PERMANENT DISABILITY shall mean the inability of the Optionee or the
Participant to engage in any substantial gainful activity by reason of any
medically determinable physical or mental impairment which is expected to result
in such person's death or to continue for a period of twelve (12) consecutive
months or more.

         T. PLAN shall mean the Corporation's 1999 Stock Option/Stock Issuance
Plan, as set forth in this document.

         U. PLAN ADMINISTRATOR shall mean either the Board or the Committee
acting in its capacity as administrator of the Plan.

         V. PLAN EFFECTIVE DATE shall mean October 26, 1999, the date on which
the Plan was adopted by the Board.

         W. PREDECESSOR PLAN shall mean the Corporation's 1999 Incentive Stock
Option Plan.

         X. SERVICE shall mean the provision of services to the Corporation (or
any Parent or Subsidiary) by a person in the capacity of an Employee, a
non-employee member of the board of directors or a consultant or independent
advisor, except to the extent otherwise specifically provided in the documents
evidencing the option grant or stock issuance.

         Y. STOCK EXCHANGE shall mean either the American Stock Exchange or the
New York Stock Exchange.

         Z. STOCK ISSUANCE AGREEMENT shall mean the agreement entered into by
the Corporation and the Participant at the time of issuance of shares of Common
Stock under the Stock Issuance Program.

         AA. STOCK ISSUANCE PROGRAM shall mean the stock issuance program in
effect under the Plan.




                                      A-3.

<PAGE>   19

         BB. 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 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.

         CC. 10% STOCKHOLDER shall mean the owner of stock (as determined under
Code Section 424(d)) possessing more than ten percent (10%) of the total
combined voting power of all classes of stock of the Corporation (or any Parent
or Subsidiary).






                                      A-4.
<PAGE>   20



                            BLUESTAR PROPERTIES, INC.
                            STOCK PURCHASE AGREEMENT


         AGREEMENT made as of this __ day of _________, 20__, by and between
BlueStar Properties, Inc., a ________________ corporation and
_____________________________, Optionee under the Corporation's 1999 Stock
Option/Stock Issuance Plan.

         All capitalized terms in this Agreement shall have the meaning assigned
to them in this Agreement or in the attached Appendix.

     A. EXERCISE OF OPTION

         1. EXERCISE. Optionee hereby purchases ___________ shares of Common
Stock (the "Purchased Shares") pursuant to that certain option (the "Option")
granted Optionee on ____________________, 199__ (the "Grant Date") to purchase
up to _______________ shares of Common Stock under the Plan at the exercise
price of $______ per share (the "Exercise Price").

         2. PAYMENT. Concurrently with the delivery of this Agreement to the
Corporation, Optionee shall pay the Exercise Price for the Purchased Shares in
accordance with the provisions of the Option Agreement and shall deliver
whatever additional documents may be required by the Option Agreement as a
condition for exercise.

         3. STOCKHOLDER RIGHTS. Until such time as the Corporation exercises the
First Refusal Right, Optionee (or any successor in interest) shall have all the
rights of a stockholder (including voting, dividend and liquidation rights) with
respect to the Purchased Shares, subject, however, to the transfer restrictions
of Articles B and C.

     B. SECURITIES LAW COMPLIANCE

         1. RESTRICTED SECURITIES. The Purchased Shares have not been registered
under the 1933 Act and are being issued to Optionee in reliance upon the
exemption from such registration provided by SEC Rule 701 for stock issuances
under compensatory benefit plans such as the Plan. Optionee hereby confirms that
Optionee has been informed that the Purchased Shares are restricted securities
under the 1933 Act and may not be resold or transferred unless the Purchased
Shares are first registered under the Federal securities laws or unless an
exemption from such registration is available. Accordingly, Optionee hereby
acknowledges that Optionee is prepared to hold the Purchased Shares for an
indefinite period and that Optionee is aware that SEC Rule 144 issued under the
1933 Act which exempts certain resales of unrestricted securities is not
presently available to exempt the resale of the Purchased Shares from the
registration requirements of the 1933 Act.



<PAGE>   21


         2. RESTRICTIONS ON DISPOSITION OF PURCHASED SHARES. Optionee shall make
no disposition of the Purchased Shares (other than a Permitted Transfer) unless
and until there is compliance with all of the following requirements:


                  (i) Optionee shall have provided the Corporation with a
    written summary of the terms and conditions of the proposed disposition.

                  (ii) Optionee shall have complied with all requirements of
    this Agreement applicable to the disposition of the Purchased Shares.

                  (iii) Optionee shall have provided the Corporation with
    written assurances, in form and substance satisfactory to the Corporation,
    that (a) the proposed disposition does not require registration of the
    Purchased Shares under the 1933 Act or (b) all appropriate action necessary
    for compliance with the registration requirements of the 1933 Act or any
    exemption from registration available under the 1933 Act (including Rule
    144) has been taken.

         The Corporation shall not be required (i) to transfer on its books any
Purchased Shares which have been sold or transferred in violation of the
provisions of this Agreement or (ii) to treat as the owner of the Purchased
Shares, or otherwise to accord voting, dividend or liquidation rights to, any
transferee to whom the Purchased Shares have been transferred in contravention
of this Agreement.

         3. RESTRICTIVE LEGENDS. The stock certificates for the Purchased Shares
shall be endorsed with the following restrictive legends:

                  (i) "The shares represented by this certificate have not been
    registered under the Securities Act of 1933. The shares may not be sold
    or offered for sale in the absence of (a) an effective registration
    statement for the shares under such Act, (b) a `no action' letter of the
    Securities and Exchange Commission with respect to such sale or offer or (c)
    satisfactory assurances to the Corporation that registration under such Act
    is not required with respect to such sale or offer."

                  (ii) "The shares represented by this certificate are subject
    to certain transfer restrictions and accordingly may not be sold, assigned,
    transferred, encumbered, or in any manner disposed of except in conformity
    with the terms of a written agreement dated ____________, 199__ between
    the Corporation and the registered holder of the shares (or the predecessor
    in interest to the shares). A copy of such agreement is maintained at the
    Corporation's principal corporate offices."

    C. TRANSFER RESTRICTIONS

         1. RESTRICTION ON TRANSFER. Except for any Permitted Transfer, Optionee
shall not transfer, assign, encumber or otherwise dispose of any of the
Purchased Shares in contravention of the First Refusal Right or the Market
Stand-Off.



                                       2

<PAGE>   22

         2. TRANSFEREE OBLIGATIONS. Each person (other than the Corporation) to
whom the Purchased Shares are transferred by means of a Permitted Transfer must,
as a condition precedent to the validity of such transfer, acknowledge in
writing to the Corporation that such person is bound by the provisions of this
Agreement and that the transferred shares are subject to (i) the First Refusal
Right and (ii) the Market Stand-Off, to the same extent such shares would be so
subject if retained by Optionee.

         3. MARKET STAND-OFF.

                  (a) In connection with any underwritten public offering by the
Corporation of its equity securities pursuant to an effective registration
statement filed under the 1933 Act, including the Corporation's initial public
offering, Owner shall not sell, make any short sale of, loan, hypothecate,
pledge, grant any option for the purchase of, or otherwise dispose or transfer
for value or otherwise agree to engage in any of the foregoing transactions with
respect to, any Purchased Shares without the prior written consent of the
Corporation or its underwriters. Such restriction (the "Market Stand-Off") shall
be in effect for such period of time from and after the effective date of the
final prospectus for the offering as may be requested by the Corporation or such
underwriters. In no event, however, shall such period exceed one hundred eighty
(180) days and the Market Stand-Off shall in all events terminate two (2) years
after the effective date of the Corporation's initial public offering.

                  (b) Owner shall be subject to the Market Stand-Off provided
and only if the officers and directors of the Corporation are also subject to
similar restrictions.

                  (c) Any new, substituted or additional securities which are by
reason of any Recapitalization or Reorganization distributed with respect to the
Purchased Shares shall be immediately subject to the Market Stand-Off, to the
same extent the Purchased Shares are at such time covered by such provisions.

                  (d) In order to enforce the Market Stand-Off, the Corporation
may impose stop-transfer instructions with respect to the Purchased Shares until
the end of the applicable stand-off period.

     D. RIGHT OF FIRST REFUSAL

         1. GRANT. The Corporation is hereby granted the right of first refusal
(the "First Refusal Right"), exercisable in connection with any proposed
transfer of the Purchased Shares. For purposes of this Article D, the term
"transfer" shall include any sale, assignment, pledge, encumbrance or other
disposition of the Purchased Shares intended to be made by Owner, but shall not
include any Permitted Transfer.

         2. NOTICE OF INTENDED DISPOSITION. In the event any Owner of Purchased
Shares desires to accept a bona fide third-party offer for the transfer of any
or all of such shares (the Purchased Shares subject to such offer to be
hereinafter referred to as the "Target Shares"), Owner shall promptly (i)
deliver to the Corporation written notice (the "Disposition Notice") of the
terms of the offer, including the purchase price and the identity of the
third-party offeror, and (ii) provide satisfactory proof that the disposition of
the Target Shares to such third-party offeror would not be in contravention of
the provisions set forth in Articles B and C.



                                       3

<PAGE>   23

         3. EXERCISE OF THE FIRST REFUSAL RIGHT. The Corporation shall, for a
period of forty-five (45) days following receipt of the Disposition Notice, have
the right to repurchase any or all of the Target Shares subject to the
Disposition Notice upon the same terms as those specified therein or upon such
other terms (not materially different from those specified in the Disposition
Notice) to which Owner consents. Such right shall be exercisable by delivery of
written notice (the "Exercise Notice") to Owner prior to the expiration of the
forty-five (45)-day exercise period. If such right is exercised with respect to
all the Target Shares, then the Corporation shall effect the repurchase of such
shares, including payment of the purchase price, not more than fifteen (15)
business days after delivery of the Exercise Notice; and at such time the
certificates representing the Target Shares shall be delivered to the
Corporation.

         Should the purchase price specified in the Disposition Notice be
payable in property other than cash or evidences of indebtedness, the
Corporation shall have the right to pay the purchase price in the form of cash
equal in amount to the value of such property. If Owner and the Corporation
cannot agree on such cash value within thirty (30) days after the Corporation's
receipt of the Disposition Notice, the valuation shall be made by an appraiser
of recognized standing selected by Owner and the Corporation or, if they cannot
agree on an appraiser within forty-five (45) days after the Corporation's
receipt of the Disposition Notice, each shall select an appraiser of recognized
standing and the two (2) appraisers shall designate a third appraiser of
recognized standing, whose appraisal shall be determinative of such value. The
cost of such appraisal shall be shared equally by Owner and the Corporation. The
closing shall then be held on the later of (i) the fifteenth (15th) business day
following delivery of the Exercise Notice or (ii) the fifteenth (15th) business
day after such valuation shall have been made.

         4. NON-EXERCISE OF THE FIRST REFUSAL RIGHT. In the event the Exercise
Notice is not given to Owner prior to the expiration of the forty-five (45)-day
exercise period, Owner shall have a period of thirty (30) days thereafter in
which to sell or otherwise dispose of the Target Shares to the third-party
offeror identified in the Disposition Notice upon terms (including the purchase
price) no more favorable to such third-party offeror than those specified in the
Disposition Notice; provided, however, that any such sale or disposition must
not be effected in contravention of the provisions of Article B and Paragraph
C.3. The third-party offeror shall acquire the Target Shares free and clear of
the First Refusal Right, but the acquired shares shall remain subject to Article
B and Paragraph C.3. In the event Owner does not effect such sale or disposition
of the Target Shares within the specified thirty (30)-day period, the First
Refusal Right shall continue to be applicable to any subsequent disposition of
the Target Shares by Owner until such right lapses.

         5. PARTIAL EXERCISE OF THE FIRST REFUSAL RIGHT. In the event the
Corporation makes a timely exercise of the First Refusal Right with respect to a
portion, but not all, of the Target Shares specified in the Disposition Notice,
Owner shall have the option, exercisable by written notice to the Corporation
delivered within fifteen (15) business days after Owner's receipt of the
Exercise Notice, to effect the sale of the Target Shares pursuant to either of
the following alternatives:

                  (i) sale or other disposition of all the Target Shares to the
    third-party offeror identified in the Disposition Notice, but in full
    compliance with



                                       4
<PAGE>   24


    the requirements of Paragraph D.4, as if the Corporation did not exercise
    the First Refusal Right; or

                  (ii) sale to the Corporation of the portion of the Target
    Shares which the Corporation has elected to purchase, such sale to be
    effected in substantial conformity with the provisions of Paragraph D.3. The
    First Refusal Right shall continue to be applicable to any subsequent
    disposition of the remaining Target Shares until such right lapses.

         Failure of Owner to deliver timely notification to the Corporation
shall be deemed to be an election by Owner to sell the Target Shares pursuant to
alternative (i) above.

         6. RECAPITALIZATION/REORGANIZATION.

         (a) Any new, substituted or additional securities or other property
which is by reason of any Recapitalization distributed with respect to the
Purchased Shares shall be immediately subject to the First Refusal Right, but
only to the extent the Purchased Shares are at the time covered by such right.

         (b) In the event of a Reorganization, the First Refusal Right shall
remain in full force and effect and shall apply to the new capital stock or
other property received in exchange for the Purchased Shares in consummation of
the Reorganization, but only to the extent the Purchased Shares are at the time
covered by such right.

         7. LAPSE. The First Refusal Right shall lapse upon the earliest to
occur of (i) the first date on which shares of the Common Stock are held of
record by more than five hundred (500) persons, (ii) a determination is made by
the Board that a public market exists for the outstanding shares of Common Stock
or (iii) a firm commitment underwritten public offering, pursuant to an
effective registration statement under the 1933 Act, covering the offer and sale
of the Common Stock in the aggregate amount of at least ten million dollars
($10,000,000). However, the Market Stand-Off shall continue to remain in full
force and effect following the lapse of the First Refusal Right.

     E. GENERAL PROVISIONS

         1. ASSIGNMENT. The Corporation may assign the First Refusal Right to
any person or entity selected by the Board, including (without limitation) one
or more stockholders of the Corporation.

         2. NO EMPLOYMENT OR SERVICE CONTRACT. Nothing in this Agreement or in
the Plan shall confer upon 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 Optionee) or of Optionee, which rights are hereby expressly reserved
by each, to terminate Optionee's Service at any time for any reason, with or
without cause.

         3. NOTICES. Any notice required to be given under this Agreement shall
be in writing and shall be deemed effective upon personal delivery or upon
deposit in the U.S. mail,



                                       5
<PAGE>   25

registered or certified, postage prepaid and properly addressed to the party
entitled to such notice at the address indicated below such party's signature
line on this Agreement or at such other address as such party may designate by
ten (10) days advance written notice under this paragraph to all other parties
to this Agreement.

         4. NO WAIVER. The failure of the Corporation in any instance to
exercise the First Refusal Right shall not constitute a waiver of any other
repurchase rights and/or rights of first refusal that may subsequently arise
under the provisions of this Agreement or any other agreement between the
Corporation and Optionee. No waiver of any breach or condition of this Agreement
shall be deemed to be a waiver of any other or subsequent breach or condition,
whether of like or different nature.

         5. CANCELLATION OF SHARES. If the Corporation shall make available, at
the time and place and in the amount and form provided in this Agreement, the
consideration for the Purchased Shares to be repurchased in accordance with the
provisions of this Agreement, then from and after such time, the person from
whom such shares are to be repurchased shall no longer have any rights as a
holder of such shares (other than the right to receive payment of such
consideration in accordance with this Agreement). Such shares shall be deemed
purchased in accordance with the applicable provisions hereof, and the
Corporation shall be deemed the owner and holder of such shares, whether or not
the certificates therefor have been delivered as required by this Agreement.

         6. OPTIONEE UNDERTAKING. Optionee hereby agrees to take whatever
additional action and execute whatever additional documents the Corporation may
deem necessary or advisable in order to carry out or effect one or more of the
obligations or restrictions imposed on either Optionee or the Purchased Shares
pursuant to the provisions of this Agreement.

         7. GOVERNING LAW. This Agreement shall be governed by, and construed in
accordance with, the laws of the State of Tennessee without resort to that
State's conflict-of-laws rules.

         8. SUCCESSORS AND ASSIGNS. The provisions of this Agreement shall inure
to the benefit of, and be binding upon, the Corporation and its successors and
assigns and upon Optionee, Optionee's permitted assigns and the legal
representatives, heirs and legatees of Optionee's estate, whether or not any
such person shall have become a party to this Agreement and have agreed in
writing to join herein and be bound by the terms hereof.


                                       6

<PAGE>   26


         IN WITNESS WHEREOF, the parties have executed this Agreement on the day
and year first indicated above.


                                         BLUESTAR PROPERTIES, INC.


                                         By:
                                            ----------------------------------
                                         Title:
                                               -------------------------------
                                         Address:
                                                 -----------------------------


                                         -------------------------------------
                                         OPTIONEE

                                         Address:
                                                 -----------------------------


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



                                       7
<PAGE>   27


                                    APPENDIX

         The following definitions shall be in effect under the Agreement:

         A. AGREEMENT shall mean this Stock Purchase Agreement.

         B. BOARD shall mean the Corporation's Board of Directors.

         C. COMMON STOCK shall mean the Corporation's common stock.

         D. CORPORATION shall mean BlueStar Properties, Inc., a Delaware
corporation.

         E. DISPOSITION NOTICE shall have the meaning assigned to such term in
Paragraph D.2.

         F. EXERCISE NOTICE shall have the meaning assigned to such term in
Paragraph D.3.

         G. EXERCISE PRICE shall have the meaning assigned to such term in
Paragraph A.1.

         H. FAIR MARKET VALUE of a share of Common Stock on any relevant date,
prior to the initial public offering of the Common Stock, shall be determined by
the Plan Administrator after taking into account such factors as it shall deem
appropriate.

         I. FIRST REFUSAL RIGHT shall mean the right granted to the Corporation
in accordance with Article D.

         J. GRANT DATE shall have the meaning assigned to such term in Paragraph
A.1.

         K. GRANT NOTICE shall mean the Notice of Grant of Stock Option pursuant
to which Optionee has been informed of the basic terms of the Option.

         L. MARKET STAND-OFF shall mean the market stand-off restriction
specified in Paragraph C.3.

         M. 1933 ACT shall mean the Securities Act of 1933, as amended.

         N. OPTION shall have the meaning assigned to such term in Paragraph
A.1.

         O. OPTION AGREEMENT shall mean all agreements and other documents
evidencing the Option.

         P. OPTIONEE shall mean the person to whom the Option is granted under
the Plan.

         Q. OWNER shall mean Optionee and all subsequent holders of the
Purchased Shares who derive their chain of ownership through a Permitted
Transfer from Optionee.




<PAGE>   28



         R. 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.

         S. PERMITTED TRANSFER shall mean (i) a gratuitous transfer of the
Purchased Shares, provided and only if Optionee obtains the Corporation's prior
written consent to such transfer, (ii) a transfer of title to the Purchased
Shares effected pursuant to Optionee's will or the laws of intestate succession
following Optionee's death or (iii) a transfer to the Corporation in pledge as
security for any purchase-money indebtedness incurred by Optionee in connection
with the acquisition of the Purchased Shares.

         T. PLAN shall mean the Corporation's 1999 Stock Option/Stock Issuance
Plan.

         U. PLAN ADMINISTRATOR shall mean either the Board or a committee of
Board members, to the extent the committee is at the time responsible for
administration of the Plan.

         V. PURCHASED SHARES shall have the meaning assigned to such term in
Paragraph A.1.

         W. RECAPITALIZATION shall mean any stock split, stock dividend,
recapitalization, combination of shares, exchange of shares or other change
affecting the Corporation's outstanding Common Stock as a class without the
Corporation's receipt of consideration.

         X. REORGANIZATION shall mean any of the following transactions:

                  (i) a merger or consolidation in which the Corporation is not
         the surviving entity,

                  (ii) a sale, transfer or other disposition of all or
         substantially all of the Corporation's assets,

                  (iii) a reverse merger in which the Corporation is the
         surviving entity but in which the Corporation's outstanding voting
         securities are transferred in whole or in part to a person or persons
         different from the persons holding those securities immediately prior
         to the merger, or

                  (iv) any transaction effected primarily to change the state in
         which the Corporation is incorporated or to create a holding company
         structure.

         Y. SEC shall mean the Securities and Exchange Commission.

         Z. SERVICE shall mean Optionee's provision of services to the
Corporation (or any Parent or Subsidiary) in the capacity of an employee,
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, a non-employee member
of the board of directors or a consultant or independent advisor.




                                      A-2.
<PAGE>   29



         AA. 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 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.

         BB. TARGET SHARES shall have the meaning assigned to such term in
Paragraph D.2.






                                      A-3.







<PAGE>   30




                            BLUESTAR PROPERTIES, INC.
                             STOCK OPTION AGREEMENT


RECITALS

         A. The Board has adopted the Plan for the purpose of retaining the
services of selected Employees, non-employee members of the Board or the board
of directors of any Parent or Subsidiary and consultants and other independent
advisors in the service of the Corporation (or any Parent or Subsidiary).

         B. Optionee is to render valuable services to the Corporation (or a
Parent or Subsidiary), and this Agreement is executed pursuant to, and is
intended to carry out the purposes of, the Plan in connection with the
Corporation's grant of an option to Optionee.

         C. All capitalized terms in this Agreement shall have the meaning
assigned to them in the attached Appendix.

            NOW, THEREFORE, it is hereby agreed as follows:

            1. GRANT OF OPTION. The Corporation hereby grants to Optionee, as of
the Grant Date, an option to purchase up to the number of Option Shares
specified in the Grant Notice. The Option Shares shall be purchasable from time
to time during the option term specified in Paragraph 2 at the Exercise Price.

            2. OPTION TERM. This option shall have a term of ten (10) years
measured from the Grant Date and shall accordingly expire at the close of
business on the Expiration Date, unless sooner terminated in accordance with
Paragraph 5 or 6.

            3. LIMITED TRANSFERABILITY. This option shall be neither
transferable nor assignable by Optionee other than by will or by the laws of
descent and distribution following Optionee's death and may be exercised, during
Optionee's lifetime, only by Optionee. However, if this option is designated a
Non-Statutory Option in the Grant Notice, then this option may be assigned in
whole or in part during Optionee's lifetime either as (i) as a gift to one or
more members of Optionee's Immediate Family, to a trust in which Optionee and/or
one or more such family members hold more than fifty percent (50%) of the
beneficial interest or an entity in which more than fifty percent (50%) of the
voting interests are owned by Optionee and/or one or more such family members,
or (ii) pursuant to a domestic relations order. The assigned portion shall be
exercisable only by the person or persons who acquire a proprietary interest in
the option pursuant to such assignment. The terms applicable to the assigned
portion shall be the same as those in effect for this 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.

<PAGE>   31


            4. EXERCISABILITY. This option shall become exercisable for the
Option Shares in one or more installments as specified in the Grant Notice. As
the option becomes exercisable for such installments, those installments shall
accumulate, and the option shall remain exercisable for the accumulated
installments until the Expiration Date or sooner termination of the option term
under Paragraph 5 or 6.

            5. CESSATION OF SERVICE. The option term specified in Paragraph 2
shall terminate (and this option shall cease to be outstanding) prior to the
Expiration Date should any of the following provisions become applicable:

                  (i) Should Optionee cease to remain in Service for any reason,
     other than death, Permanent Disability, Misconduct or an Involuntary
     Termination pursuant to Paragraph 6, while this option is outstanding,
     then the period for exercising this option shall be limited to a three
     (3)-month period measured from the date of such cessation of Service but in
     no event shall this option be exercisable at any time after the Expiration
     Date. During such period, this option may not be exercised in the aggregate
     for more than the number of Option Shares for which this option is, at the
     time of Optionee's cessation of Service, exercisable in accordance with the
     Exercise Schedule specified in the Grant Notice. Upon the expiration of
     such three (3)-month exercise period or (if earlier) upon the Expiration
     Date, this option shall terminate and cease to be outstanding for any
     Option Shares for which the option has not been exercised. To the extent
     this option is not exercisable for Option Shares, in accordance with the
     Exercise Schedule specified in the Grant Notice, as of the date of
     Optionee's cessation of Service pursuant to this Paragraph 5(i), then this
     option shall immediately terminate as of such date and cease to be
     outstanding with respect to such unexercisable Option Shares.

                  (ii) Should Optionee's Service cease by reason of his or her
     death, then, as of the date of Optionee's cessation of Service, this
     option shall immediately accelerate in full and become exercisable for all
     of the Option Shares as fully vested shares of Common Stock. The personal
     representative of Optionee's estate or the person or persons to whom the
     option is transferred pursuant to Optionee's will or in accordance with
     the laws of descent and distribution shall have the right to exercise this
     option for all of such Option Shares. Such right shall lapse, and this
     option shall cease to be outstanding, upon the earlier of (i) the
     expiration of the twelve (12)-month period measured from the date of
     Optionee's termination of Service or (ii) the Expiration Date.


                  (iii) Should Optionee cease Service by reason of Permanent
     Disability while this option is outstanding, then, as of the effective
     date of Optionee's termination of Service, this option shall immediately
     accelerate in full and become exercisable for all of the Option Shares as
     fully vested shares of Common Stock. The Optionee shall have a period of
     twelve (12) months following the date of such cessation of Service during
     which to exercise this option. Upon the expiration of the twelve (12)-month
     period, the option shall terminate and cease to be outstanding for any
     Option Shares for which the option



                                       2.
<PAGE>   32

     has not been exercised. In no event, however, shall this option be
     exercisable at any time after the Expiration Date.

                  (iv) Should Optionee's Service be terminated for Misconduct,
     then this option shall terminate immediately and cease to remain
     outstanding.

                  (v) In the event of an Involuntary Termination of Optionee's
     Service following a Corporate Transaction, the provisions of Paragraph 6
     shall govern the period for which this option is to remain exercisable
     following Optionee's cessation of Service and shall supersede any
     provisions to the contrary in this Paragraph.

          6. CORPORATE TRANSACTION.

             (a) Immediately prior to the effective date of a Corporate
Transaction, the exercisability of this option shall automatically accelerate so
that this option shall become exercisable for all of the Option Shares as
fully-vested shares of Common Stock and may be exercised for any or all of those
Option Shares. No such accelerated exercisability of this option, however, shall
occur if and to the extent: (i) this option is, in connection with the Corporate
Transaction, either to be assumed by the successor corporation (or parent
thereof) in the Corporate Transaction or (ii) this option is to be replaced with
a cash incentive program of the successor corporation which preserves the spread
existing on the Option Shares for which this option is exercisable at the time
of the Corporate Transaction (the excess of the Fair Market Value of those
Option Shares over the Exercise Price payable for such shares) and provides for
subsequent payout in accordance with the Exercise Schedule.

             (b) Immediately following the Corporate Transaction, this option
shall terminate and cease to be outstanding, except to the extent assumed by the
successor corporation (or parent thereof) in connection with the Corporate
Transaction.

             (c) If this option is assumed in connection with a Corporate
Transaction, then this option shall be appropriately adjusted, immediately after
such Corporate Transaction, to apply to the number and class of securities which
would have been issuable to Optionee in consummation of such Corporate
Transaction had the option been exercised immediately prior to such Corporate
Transaction, and appropriate adjustments shall also be made to the Exercise
Price, provided the aggregate Exercise Price shall remain the same.

             (d) Should there occur an Involuntary Termination of Optionee's
Service within twelve (12) months following a Corporate Transaction in which
this option is assumed, this option shall automatically accelerate as of the
date of Optionee's Involuntary Termination and shall immediately become
exercisable for an additional number of Option Shares equal to the greater of
(i) fifty percent (50%) of the total number of Option Shares which have not yet,
as of such date, become exercisable in accordance with the Exercise Schedule, or
(ii) the number of Option Shares which would otherwise have become exercisable,
in accordance with the Exercise Schedule, during the one (1)-year period
following the effective date of the Corporate Transaction, had Optionee remained
in Service through such period. This option may



                                       3.
<PAGE>   33

be exercised for any or all of the exercisable Option Shares at any time prior
to the earlier of (i) the Expiration Date or (ii) the expiration of the one
(l)-year period measured from the date of Optionee's Involuntary Termination.


             (e) This Agreement shall not in any 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.

         7. ADJUSTMENT IN OPTION SHARES. Should any change be 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 to (i) the total number
and/or class of securities subject to this option and (ii) the Exercise Price in
order to reflect such change and thereby preclude a dilution or enlargement of
benefits hereunder.

         8. STOCKHOLDER RIGHTS. The holder of this option shall not have any
stockholder rights with respect to the Option Shares until such person shall
have exercised the option, paid the Exercise Price and become the record holder
of the purchased shares.

         9. MANNER OF EXERCISING OPTION.

             (a) In order to exercise this option with respect to all or any
part of the Option Shares for which this option is at the time exercisable,
Optionee (or any other person or persons exercising the option) must take the
following actions:

                  (i) Execute and deliver to the Corporation a Purchase
     Agreement for the Option Shares for which the option is exercised.

                  (ii) Pay the aggregate Exercise Price for the purchased shares
     in one or more of the following forms:

                           (A) cash or check made payable to the Corporation; or

                           (B) a promissory note payable to the Corporation, but
              only to the extent authorized by the Plan Administrator in
              accordance with Paragraph 14.

                       Should the Common Stock be registered under Section 12 of
              the 1934 Act at the time the option is exercised, then
              the Exercise Price may also be paid as follows:

                           (C) in shares of Common Stock held by Optionee (or
              any other person or persons exercising the option) for the
              requisite period necessary to avoid a charge to the Corporation's
              earnings



                                       4.
<PAGE>   34

              for financial reporting purposes and valued at Fair Market Value
              on the Exercise Date; or

                           (D) through a special sale and remittance procedure
              pursuant to which Optionee (or any other person or persons
              exercising the option) shall concurrently provide irrevocable
              instructions to 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 Federal,
              state and local income and employment taxes required to be
              withheld by the Corporation by reason of such exercise and to 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 the sale and remittance procedure
              is utilized in connection with the option exercise, payment of the
              Exercise Price must accompany the Purchase Agreement delivered to
              the Corporation in connection with the option exercise.

                           (iii) Furnish to the Corporation appropriate
          documentation that the person or persons exercising the option (if
         other than Optionee) have the right to exercise this option.

                           (iv) Execute and deliver to the Corporation such
         written representations as may be requested by the Corporation in order
         for it to comply with the applicable requirements of Federal and state
         securities laws.

                           (v) Make appropriate arrangements with the
         Corporation (or Parent or Subsidiary employing or retaining Optionee)
         for the satisfaction of all Federal, state and local income and
         employment tax withholding requirements applicable to the option
         exercise.

                  (b) As soon as practical after the Exercise Date, the
Corporation shall issue to or on behalf of Optionee (or any other person or
persons exercising this option) a certificate for the purchased Option Shares,
with the appropriate legends affixed thereto.

                  (c) In no event may this option be exercised for any
fractional shares.

         10. TRANSFER RESTRICTIONS. ALL OPTION SHARES ACQUIRED UPON THE EXERCISE
OF THIS OPTION SHALL BE SUBJECT TO CERTAIN RESTRICTIONS ON TRANSFER IN
ACCORDANCE WITH THE TERMS SPECIFIED IN THE PURCHASE AGREEMENT.

         11. COMPLIANCE WITH LAWS AND REGULATIONS.

                  (a) The exercise of this option and the issuance of the Option
Shares upon such exercise shall be subject to compliance by the Corporation and
Optionee with all

                                       5.
<PAGE>   35

applicable requirements of law relating thereto and with all applicable
regulations of any stock exchange (or the Nasdaq National Market, if applicable)
on which the Common Stock may be listed for trading at the time of such exercise
and issuance.

                  (b) The inability of the Corporation to obtain approval from
any regulatory body having authority deemed by the Corporation to be necessary
to the lawful issuance and sale of any Common Stock pursuant to this option
shall relieve the Corporation of any liability with respect to the non-issuance
or sale of the Common Stock as to which such approval shall not have been
obtained. The Corporation, however, shall use its best efforts to obtain all
such approvals.

         12. SUCCESSORS AND ASSIGNS. Except to the extent otherwise provided in
Paragraphs 3 and 6, the provisions of this Agreement shall inure to the benefit
of, and be binding upon, the Corporation and its successors and assigns and
Optionee, Optionee's assigns and the legal representatives, heirs and legatees
of Optionee's estate.

         13. NOTICES. Any notice required to be given or delivered to the
Corporation under the terms of this Agreement shall be in writing and addressed
to the Corporation at its principal corporate offices. Any notice required to be
given or delivered to Optionee shall be in writing and addressed to Optionee at
the address indicated below Optionee's signature line on the Grant Notice. All
notices shall be deemed effective upon personal delivery or upon deposit in the
U.S. mail, postage prepaid and properly addressed to the party to be notified.

         14. FINANCING. The Plan Administrator may, in its absolute discretion
and without any obligation to do so, permit Optionee to pay the Exercise Price
for the purchased Option Shares by delivering a full-recourse, interest-bearing
promissory note secured by those Option Shares. The payment schedule in effect
for any such promissory note shall be established by the Plan Administrator in
its sole discretion.

         15. CONSTRUCTION. This Agreement and the option evidenced hereby are
made and granted pursuant to the Plan and are in all respects limited by and
subject to the terms of the Plan. All decisions of the Plan Administrator with
respect to any question or issue arising under the Plan or this Agreement shall
be conclusive and binding on all persons having an interest in this option.

         16. GOVERNING LAW. The interpretation, performance and enforcement of
this Agreement shall be governed by the laws of the State of Tennessee without
resort to that State's conflict-of-laws rules.

         17. STOCKHOLDER APPROVAL. If the Option Shares covered by this
Agreement exceed, as of the Grant Date, the number of shares of Common Stock
which may without stockholder approval be issued under the Plan, then this
option shall be void with respect to such excess shares, unless stockholder
approval of an amendment sufficiently increasing the number of shares of Common
Stock issuable under the Plan is obtained in accordance with the provisions of
the Plan.


                                       6.

<PAGE>   36

         18. ADDITIONAL TERMS APPLICABLE TO AN INCENTIVE OPTION. In the event
this option is designated an Incentive Option in the Grant Notice, the following
terms and conditions shall also apply to the grant:

                  (a) This option shall cease to qualify for favorable tax
treatment as an Incentive Option if (and to the extent) this option is exercised
for one or more Option Shares: more than three (3) months after the date
Optionee ceases to be an Employee for any reason other than death or Permanent
Disability or more than twelve (12) months after the date Optionee ceases to be
an Employee by reason of Permanent Disability.

                  (b) No installment under this option shall qualify for
favorable tax treatment as an Incentive Option if (and to the extent) the
aggregate Fair Market Value (determined at the Grant Date) of the Common Stock
for which such installment first becomes exercisable hereunder would, when added
to the aggregate value (determined as of the respective date or dates of grant)
of any earlier installments of the Common Stock and any other securities for
which this option or any other Incentive Options granted to Optionee prior to
the Grant Date (whether under the Plan or any other option plan of the
Corporation or any Parent or Subsidiary) first become exercisable during the
same calendar year, exceed One Hundred Thousand Dollars ($100,000) in the
aggregate. Should such One Hundred Thousand Dollar ($100,000) limitation be
exceeded in any calendar year, this option shall nevertheless become exercisable
for the excess shares in such calendar year as a Non-Statutory Option.

                  (c) Should the exercisability of this option be accelerated
upon a Corporate Transaction or Involuntary Termination, then this option shall
qualify for favorable tax treatment as an Incentive Option only to the extent
the aggregate Fair Market Value (determined at the Grant Date) of the Common
Stock for which this option first becomes exercisable in the calendar year in
which such acceleration event occurs does not, when added to the aggregate value
(determined as of the respective date or dates of grant) of the Common Stock or
other securities for which this option or one or more other Incentive Options
granted to Optionee prior to the Grant Date (whether under the Plan or any other
option plan of the Corporation or any Parent or Subsidiary) first become
exercisable during the same calendar year, exceed One Hundred Thousand Dollars
($100,000) in the aggregate. Should the applicable One Hundred Thousand Dollar
($100,000) limitation be exceeded in the calendar year of such Corporate
Transaction or Involuntary Termination, the option may nevertheless be exercised
for the excess shares in such calendar year as a Non-Statutory Option.

                  (d) Should Optionee hold, in addition to this option, one or
more other options to purchase Common Stock which become exercisable for the
first time in the same calendar year as this option, then the foregoing
limitations on the exercisability of such options as Incentive Options shall be
applied on the basis of the order in which such options are granted.




                                       7.
<PAGE>   37



                                    APPENDIX

         The following definitions shall be in effect under the Agreement:

         A. AGREEMENT shall mean this Stock Option Agreement.

         B. BOARD shall mean the Corporation's Board of Directors.

         C. CODE shall mean the Internal Revenue Code of 1986, as amended.

         D. COMMON STOCK shall mean the Corporation's common stock.

         E. CORPORATE TRANSACTION shall mean either of the following
stockholder-approved transactions to which the Corporation is a party:

                  (i) a merger or consolidation in which securities possessing
         more than fifty percent (50%) of the total combined voting power of the
         Corporation's outstanding securities are transferred to a person or
         persons different from the persons holding those 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.

         F. CORPORATION shall mean BlueStar Properties, Inc., a Delaware
corporation, and any successor corporation to all or substantially all of the
assets or voting stock of BlueStar Properties, Inc. which shall by appropriate
action adopt the Plan.

         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 option shall have
been exercised in accordance with Paragraph 9 of the Agreement.

         I. EXERCISE PRICE shall mean the exercise price payable per Option
Share as specified in the Grant Notice.

         J. EXERCISE SCHEDULE shall mean the exercise schedule specified in the
Grant Notice pursuant to which this option is to become exercisable in a series
of installments over Optionee's period of Service.

         K. EXPIRATION DATE shall mean the date on which the option expires as
specified in the Grant Notice.

         L. FAIR MARKET VALUE per share of Common Stock on any relevant date
shall be determined in accordance with the following provisions:


                                      A-1.
<PAGE>   38


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

                  (iii) If the Common Stock is at the time neither listed on any
         Stock Exchange nor traded on the Nasdaq National Market, then the Fair
         Market Value shall be determined by the Plan Administrator after taking
         into account such factors as the Plan Administrator shall deem
         appropriate.


         M. GRANT DATE shall mean the date of grant of the option as specified
in the Grant Notice.

         N. GRANT NOTICE shall mean the Notice of Grant of Stock Option
accompanying the Agreement, pursuant to which Optionee has been informed of the
basic terms of the option evidenced hereby.

         O. IMMEDIATE FAMILY of Optionee shall mean Optionee's 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, including adoptive relationships.

         P. INCENTIVE OPTION shall mean an option which satisfies the
requirements of Code Section 422.

         Q. INVOLUNTARY TERMINATION shall mean the termination of Optionee's
Service which occurs by reason of:

                  (i) Optionee's involuntary dismissal or discharge by the
         Corporation for reasons other than Misconduct, or

                  (ii) Optionee's voluntary resignation following (A) a change
         in Optionee's position with the Corporation (or Parent or Subsidiary
         employing Optionee) which materially reduces Optionee's duties and
         responsibilities or the level of management to which he or she reports
         (B) a reduction in Optionee's level of compensation (including base
         salary, fringe benefits and target bonus



                                      A-2.
<PAGE>   39

         under any corporate performance-based bonus or incentive programs) by
         more than fifteen percent (15%) or (C) a relocation of Optionee's place
         of employment by more than fifty (50) miles, provided and only if such
         change, reduction or relocation is effected without Optionee's consent.


         R. MISCONDUCT shall mean the commission of any act of fraud,
embezzlement or dishonesty by Optionee, any unauthorized use or disclosure by
Optionee of confidential information or trade secrets of the Corporation (or any
Parent or Subsidiary), or any other intentional misconduct by Optionee adversely
affecting the business or affairs of the Corporation (or any Parent or
Subsidiary) in a material manner. The foregoing definition shall not be deemed
to be inclusive of all the acts or omissions which the Corporation (or any
Parent or Subsidiary) may consider as grounds for the dismissal or discharge of
Optionee or any other individual in the Service of the Corporation (or any
Parent or Subsidiary).

         S. 1934 ACT shall mean the Securities Exchange Act of 1934, as amended.

         T. NON-STATUTORY OPTION shall mean an option not intended to satisfy
the requirements of Code Section 422.

         U. OPTION SHARES shall mean the number of shares of Common Stock
subject to the option as specified in the Grant Notice.

         V. OPTIONEE shall mean the person to whom the option is granted as
specified in the Grant Notice.

         W. 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.

         X. PERMANENT DISABILITY shall mean the inability of Optionee to engage
in any substantial gainful activity by reason of any medically determinable
physical or mental impairment which is expected to result in death or has lasted
or can be expected to last for a continuous period of twelve (12) months or
more.

         Y. PLAN shall mean the Corporation's 1999 Stock Option/Stock Issuance
Plan.

         Z. PLAN ADMINISTRATOR shall mean either the Board or a committee of the
Board acting in its capacity as administrator of the Plan.

         AA. PURCHASE AGREEMENT shall mean the stock purchase agreement in
substantially the form of Exhibit B to the Grant Notice.

         AA. SERVICE shall mean Optionee's performance of services for the
Corporation (or any Parent or Subsidiary) in the capacity of an Employee, a
non-employee member of the board of directors or a consultant or independent
advisor.



                                      A-3.

<PAGE>   40




         AB. STOCK EXCHANGE shall mean the American Stock Exchange or the New
York Stock Exchange.

         AC. 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 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.






                                      A-4.