EXHIBIT 4.1(a)
                             WEBTRENDS CORPORATION

                     1997 STOCK INCENTIVE COMPENSATION PLAN


                               SECTION 1. PURPOSE

     The purpose of the WebTrends Corporation 1997 Stock Incentive Compensation
Plan (the "Plan") is to enhance the long-term shareholder value of WebTrends
Corporation, an Oregon corporation (the "Company"), by offering opportunities
to employees, directors, officers, consultants, agents, advisors and
independent contractors of the Company and its Subsidiaries (as defined in
Section 2) to participate in the Company's growth and success, and to encourage
them to remain in the service of the Company and its Subsidiaries and to
acquire and maintain stock ownership in the Company.


                             SECTION 2. DEFINITIONS

     For purposes of the Plan, the following terms shall be defined as set
forth below:

2.1     AWARD

     "Award" means an award or grant made to a Participant pursuant to the
Plan, including, without limitation, awards or grants of Options, Stock Awards,
or any combination of the foregoing.

2.2     BOARD

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

2.3     CODE

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

2.4     COMMON STOCK

     "Common Stock" means the Common Stock of the Company as of the effective
date of the Plan, including the Class A Voting Common Stock, without par value,
and the Class B Non-voting Common Stock, without par value, of the Company.

2.5     CORPORATE TRANSACTION

     "Corporate Transaction" means any of the following events:

          (a) Consummation of any merger or consolidation of the Company in
     which the Company is not the continuing or surviving corporation, or
     pursuant to which shares







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     of the Common Stock are converted into cash, securities or other property,
     if following such merger or consolidation the holders of the Company's
     outstanding voting securities immediately prior to such merger or
     consolidation own less than 66-2/3% of the outstanding voting securities
     of the surviving corporation;

          (b) Consummation of any sale, lease, exchange or other transfer in
     one transaction or a series of related transactions of all or
     substantially all of the Company's assets other than a transfer of the
     Company's assets to a majority-owned subsidiary corporation (as the term
     "subsidiary corporation" is defined in Section 8.3) of the Company; or

          (c) Approval by the holders of the Common Stock of any plan or
     proposal for the liquidation or dissolution of the Company. 2.6 DISABILITY

     "Disability" has the meaning defined in Section 22(e)(3) of the Code.

2.7     EARLY RETIREMENT

     "Early Retirement" means early retirement as that term is defined by the
Plan Administrator from time to time for purposes of the Plan.

2.8     EXCHANGE ACT

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

2.9     FAIR MARKET VALUE

     "Fair Market Value" shall be as established in good faith by the Plan
Administrator or (a) if the Common Stock is listed on the Nasdaq National
Market, the closing selling price for the Common Stock as reported by the
Nasdaq National Market for a single trading day or (b) if the Common Stock is
listed on the New York Stock Exchange or the American Stock Exchange, the
closing selling price for the Common Stock as such price is officially quoted
in the composite tape of transactions on such exchange for a single trading
day. If there is no such reported price for the Common Stock for the date in
question, then such price on the last preceding date for which such price
exists shall be determinative of Fair Market Value.

2.10    GRANT DATE

     "Grant Date" means the date the Plan Administrator adopted the granting
resolution or a later date designated in a resolution of the Plan Administrator
as the date an Award is to be granted.








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2.11    HOLDER

     "Holder" means: (i) the Participant to whom an Award is granted; (ii) for
a Holder who has died, the personal representative of the Holder's estate, the
person(s) to whom the Holder's rights under an Award have passed by will or by
the applicable laws of descent and distribution, or the beneficiary designated
in accordance with Section 10; or (iii) the person(s) to whom an Award has been
transferred in accordance with Section 10.

2.12    INCENTIVE STOCK OPTION

     "Incentive Stock Option" means an Option to purchase Common Stock granted
under Section 7 with the intention that it qualify as an "incentive stock
option" as that term is defined in Section 422 of the Code.

2.13    NONQUALIFIED STOCK OPTION

     "Nonqualified Stock Option" means an Option to purchase Common Stock
granted under Section 7 other than an Incentive Stock Option. 2.14 OPTION

     "Option" means the right to purchase Common Stock granted under Section 7.

2.15    PARTICIPANT

     "Participant" means an individual who is a Holder of an Award or, as the
context may require, any employee, director, officer, consultant, agent,
advisor or independent contractor of the Company or a Subsidiary who has been
designated by the Plan Administrator as eligible to participate in the Plan.

2.16    PLAN ADMINISTRATOR

     "Plan Administrator" means the Board or any committee of the Board
designated to administer the Plan under Section 3.1.

2.17    RESTRICTED STOCK

     "Restricted Stock" means shares of Common Stock granted under Section 9,
the rights of ownership of which are subject to restrictions prescribed by the
Plan Administrator.

2.18    RETIREMENT

     "Retirement" means retirement as of the individual's normal retirement
date as that term is defined by the Plan Administrator from time to time for
purposes of the Plan.


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2.19    SECURITIES ACT

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

2.20    STOCK AWARD

     "Stock Award" means an award granted under Section 9.

2.21    SUBSIDIARY

     "Subsidiary," except as provided in Section 8.3 in connection with
Incentive Stock Options, means any entity that is directly or indirectly
controlled by the Company or in which the Company has a significant ownership
interest, as determined by the Plan Administrator, and any entity that may
become a direct or indirect parent of the Company.

2.22    SUCCESSOR CORPORATION

     "Successor Corporation" has the meaning set forth under Section 11.2.

                            SECTION 3. ADMINISTRATION

3.1     PLAN ADMINISTRATOR

     The Plan shall be administered by the Board or a committee or committees
(which term includes subcommittees) appointed by, and consisting of two or more
members of, the Board. If and so long as the Common Stock is registered under
Section 12(b) or 12(g) of the Exchange Act, the Board shall consider in
selecting the Plan Administrator and the membership of any committee acting as
Plan Administrator, with respect to any persons subject or likely to become
subject to Section 16 of the Exchange Act, the provisions regarding (a)
"outside directors" as contemplated by Section 162(m) of the Code and (b)
"nonemployee directors" as contemplated by Rule 16b-3 under the Exchange Act.
The Board may delegate the responsibility for administering the Plan with
respect to designated classes of eligible Participants to different committees
consisting of two or more members of the Board, subject to such limitations as
the Board or the Plan Administrator deems appropriate. Committee members shall
serve for such term as the Board may determine, subject to removal by the Board
at any time.

3.2     ADMINISTRATION AND INTERPRETATION BY THE PLAN ADMINISTRATOR

     Except for the terms and conditions explicitly set forth in the Plan, the
Plan Administrator shall have exclusive authority, in its discretion, to
determine all matters relating to Awards under the Plan, including the
selection of individuals to be granted Awards, the type of Awards, the number
of shares of Common Stock subject to an Award, all terms, conditions,
restrictions and limitations, if any, of an Award and the terms of any
instrument that evidences the Award. The Plan Administrator shall also have
exclusive authority to interpret the Plan and may from time to time adopt, and
change, rules and regulations of general application for the Plan's
administration. The Plan Administrator's interpretation of the Plan and its
rules and regulations, and all actions taken and determinations made by the
Plan Administrator pursuant to the Plan, shall be



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conclusive and binding on all parties involved or affected. The Plan
Administrator may delegate administrative duties to such of the Company's
officers as it so determines.


                      SECTION 4. STOCK SUBJECT TO THE PLAN

4.1     AUTHORIZED NUMBER OF SHARES

     Subject to adjustment from time to time as provided in Section 11.1, a
maximum of 1,534,524 shares of Common Stock shall be available for issuance
under the Plan. Shares issued under the Plan shall be drawn from authorized and
unissued shares or shares now held or subsequently acquired by the Company.

4.2     REUSE OF SHARES

     Any shares of Common Stock that have been made subject to an Award that
cease to be subject to the Award (other than by reason of exercise or payment
of the Award to the extent it is exercised for or settled in shares) shall
again be available for issuance in connection with future grants of Awards
under the Plan.


                             SECTION 5. ELIGIBILITY

     Awards may be granted under the Plan to those officers, directors and
employees of the Company and its Subsidiaries as the Plan Administrator from
time to time selects. Awards may also be made to consultants, agents, advisors
and independent contractors who provide services to the Company and its
Subsidiaries.


                                SECTION 6. AWARDS

6.1     FORM AND GRANT OF AWARDS

     The Plan Administrator shall have the authority, in its sole discretion,
to determine the type or types of Awards to be made under the Plan. Such Awards
may include, but are not limited to, Incentive Stock Options, Nonqualified
Stock Options and Stock Awards. Awards may be granted singly, in combination or
in tandem so that the settlement or payment of one automatically reduces or
cancels the other. Awards may also be made in combination or in tandem with, in
replacement of, as alternatives to, or as the payment form for, grants or
rights under any other employee or compensation plan of the Company.

6.2     ACQUIRED COMPANY AWARDS

     Notwithstanding anything in the Plan to the contrary, the Plan
Administrator may grant Awards under the Plan in substitution for awards issued
under other plans, or assume under the Plan awards issued under other plans, if
the other plans are or were plans of other acquired entities ("Acquired
Entities") (or the parent of the Acquired Entity) and the new Award is
substituted, or the old award is assumed, by reason of a merger, consolidation,
acquisition of property or of stock, reorganization or liquidation (the
"Acquisition Transaction"). In the event that a written agreement pursuant to
which the Acquisition Transaction is completed is approved


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by the Board and said agreement sets forth the terms and conditions of the
substitution for or assumption of outstanding awards of the Acquired Entity,
said terms and conditions shall be deemed to be the action of the Plan
Administrator without any further action by the Plan Administrator, except as
may be required for compliance with Rule 16b-3 under the Exchange Act, and the
persons holding such Awards shall be deemed to be Participants and Holders.

                          SECTION 7. AWARDS OF OPTIONS

7.1     GRANT OF OPTIONS

     The Plan Administrator is authorized under the Plan, in its sole
discretion, to issue Options as Incentive Stock Options or as Nonqualified
Stock Options, which shall be appropriately designated.

7.2     OPTION EXERCISE PRICE

     The exercise price for shares purchased under an Option shall be as
determined by the Plan Administrator, but shall not be less than 100% of the
Fair Market Value of the Common Stock on the Grant Date with respect to
Incentive Stock Options and not less than 85% of the Fair Market Value of the
Common Stock on the Grant Date with respect to Nonqualified Stock Options.

7.3     TERM OF OPTIONS

     The term of each Option shall be as established by the Plan Administrator
or, if not so established, shall be 10 years from the Grant Date.

7.4     EXERCISE OF OPTIONS

     The Plan Administrator shall establish and set forth in each instrument
that evidences an Option the time at which or the installments in which the
Option shall vest and become exercisable, which provisions may be waived or
modified by the Plan Administrator at any time. If not so established in the
instrument evidencing the Option, the Option will vest and become exercisable
according to the following schedule, which may be waived or modified by the
Plan Administrator at any time:



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================================================================================

 Period of Holder's Continuous Employment
  with or Service To the Company or Its              Percent of Total Option
 Subsidiaries From the Option Grant Date          That Is Vested and Exercisable
--------------------------------------------------------------------------------

              After 1 year                                    25%
--------------------------------------------------------------------------------
              After 2 years                                   50%
--------------------------------------------------------------------------------
              After 3 years                                   75%
--------------------------------------------------------------------------------
              After 4 years                                   100%
================================================================================


     To the extent that the right to purchase shares has accrued thereunder, an
Option may be exercised from time to time by written notice to the Company, in
accordance with procedures established by the Plan Administrator, setting forth
the number of shares with respect to which the Option is being exercised and
accompanied by payment in full as described in Section 7.5. The Plan
Administrator may determine at any time that an Option may not be exercised as
to less than 100 shares at any one time (or the lesser number of vested
remaining shares covered by the Option).

7.5     PAYMENT OF EXERCISE PRICE

     The exercise price for shares purchased under an Option shall be paid in
full to the Company by delivery of consideration equal to the product of the
Option exercise price and the number of shares purchased. Such consideration
must be paid in cash or by check, or, unless the Plan Administrator in its sole
discretion determines otherwise, either at the time the Option is granted or at
any time before it is exercised, a combination of cash and/or check (if any)
and one or both of the following alternative forms: (a) tendering (either
actually or, if and so long as the Common Stock is registered under Section
12(b) or 12(g) of the Exchange Act, by attestation) Common Stock already owned
by the Holder for at least six months (or any shorter period necessary to avoid
a charge to the Company's earnings for financial reporting purposes) having a
Fair Market Value on the day prior to the exercise date equal to the aggregate
Option exercise price or (b) if and so long as the Common Stock is registered
under Section 12(b) or 12(g) of the Exchange Act, delivery of a properly
executed exercise notice, together with irrevocable instructions, to (i) a
brokerage firm designated by the Company to deliver promptly to the Company the
aggregate amount of sale or loan proceeds to pay the Option exercise price and
any withholding tax obligations that may arise in connection with the exercise
and (ii) the Company to deliver the certificates for such purchased shares
directly to such brokerage firm, all in accordance with the regulations of the
Federal Reserve Board. In addition, to the extent permitted by the Plan
Administrator in its sole discretion, the price for shares purchased under an
Option may be paid, either singly or in combination with one or more of the
alternative forms of payment authorized by this Section 7.5 by (y) a promissory
note delivered pursuant to Section 13 or (z) such other consideration as the
Plan Administrator may permit.


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7.6     POST-TERMINATION EXERCISES

     The Plan Administrator shall establish and set forth in each instrument
that evidences an Option whether the Option will continue to be exercisable,
and the terms and conditions of such exercise, if a Holder ceases to be
employed by, or to provide services to, the Company or its Subsidiaries, which
provisions may be waived or modified by the Plan Administrator at any time. If
not so established in the instrument evidencing the Option, the Option will be
exercisable according to the following terms and conditions, which may be
waived or modified by the Plan Administrator at any time.

     In case of termination of the Holder's employment or services other than
by reason of death, the Option shall be exercisable, to the extent of the
number of shares purchasable by the Holder at the date of such termination,
only (a) within one year if the termination of the Holder's employment or
services is coincident with Retirement, Early Retirement at the Company's
request or Disability or (b) within thirty days after the date the Holder
ceases to be an employee, director, officer, consultant, agent, advisor or
independent contractor of the Company or a Subsidiary if termination of the
Holder's employment or services is for any reason other than Retirement, Early
Retirement at the Company's request or Disability, but in no event later than
the remaining term of the Option. Any Option exercisable at the time of the
Holder's death may be exercised, to the extent of the number of shares
purchasable by the Holder at the date of the Holder's death, by the personal
representative of the Holder's estate, the person(s) to whom the Holder's
rights under the Award have passed by will or the applicable laws of descent
and distribution or the beneficiary designated pursuant to Section 10 at any
time or from time to time within one year after the date of death, but in no
event later than the remaining term of the Option. Any portion of an Option
that is not exercisable on the date of termination of the Holder's employment
or services shall terminate on such date, unless the Plan Administrator
determines otherwise.

     A transfer of employment or services between or among the Company and its
Subsidiaries shall not be considered a termination of employment or services
for purposes of this Section 7.6. The effect of a Company-approved leave of
absence on the terms and conditions of an Option shall be determined by the
Plan Administrator, in its sole discretion.


                  SECTION 8. INCENTIVE STOCK OPTION LIMITATIONS

     To the extent required by Section 422 of the Code, Incentive Stock Options
shall be subject to the following additional terms and conditions:

8.1     DOLLAR LIMITATION

     To the extent the aggregate Fair Market Value (determined as of the Grant
Date) of Common Stock with respect to which Incentive Stock Options are
exercisable for the first time during any calendar year (under the Plan and all
other stock option plans of the Company) exceeds $100,000, such portion in
excess of $100,000 shall be treated as a Nonqualified Stock Option. In the
event the Participant holds two or more such Options that become exercisable
for


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the first time in the same calendar year, such limitation shall be applied on
the basis of the order in which such Options are granted.

8.2     10% SHAREHOLDERS

     If a Participant owns more than 10% of the total voting power of all
classes of the Company's stock, then the exercise price per share of an
Incentive Stock Option shall not be less than 110% of the Fair Market Value of
the Common Stock on the Grant Date and the Option term shall not exceed five
years. The determination of 10% ownership shall be made in accordance with
Section 422 of the Code.

8.3     ELIGIBLE EMPLOYEES

     Individuals who are not employees of the Company or one of its parent
corporations or subsidiary corporations may not be granted Incentive Stock
Options. For purposes of this Section 8.3, "parent corporation" and "subsidiary
corporation" shall have the meanings attributed to those terms for purposes of
Section 422 of the Code.

8.4     TERM

     The term of an Incentive Stock Option shall not exceed 10 years.

8.5     EXERCISABILITY

     To qualify for Incentive Stock Option tax treatment, an Option designated
as an Incentive Stock Option must be exercised within three months after
termination of employment for reasons other than death, except that, in the
case of termination of employment due to total disability, such Option must be
exercised within one year after such termination. Employment shall not be
deemed to continue beyond the first 90 days of a leave of absence unless the
Participant's reemployment rights are guaranteed by statute or contract. For
purposes of this Section 8.5, "total disability" shall mean a mental or
physical impairment of the Participant that is expected to result in death or
that has lasted or is expected to last for a continuous period of 12 months or
more and that causes the Participant to be unable, in the opinion of the
Company and two independent physicians, to perform his or her duties for the
Company and to be engaged in any substantial gainful activity. Total disability
shall be deemed to have occurred on the first day after the Company and the two
independent physicians have furnished their opinion of total disability to the
Plan Administrator.

8.6     TAXATION OF INCENTIVE STOCK OPTIONS

     In order to obtain certain tax benefits afforded to Incentive Stock
Options under Section 422 of the Code, the Participant must hold the shares
issued upon the exercise of an Incentive Stock Option for two years after the
Grant Date of the Incentive Stock Option and one year from the date of
exercise. A Participant may be subject to the alternative minimum tax at the
time of exercise of an Incentive Stock Option. The Plan Administrator may
require a



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Participant to give the Company prompt notice of any disposition of shares
acquired by the exercise of an Incentive Stock Option prior to the expiration
of such holding periods.

8.7     PROMISSORY NOTES

     The amount of any promissory note delivered pursuant to Section 13 in
connection with an Incentive Stock Option shall bear interest at a rate
specified by the Plan Administrator but in no case less than the rate required
to avoid imputation of interest (taking into account any exceptions to the
imputed interest rules) for federal income tax purposes.


                             SECTION 9. STOCK AWARDS

9.1     GRANT OF STOCK AWARDS

     The Plan Administrator is authorized to make Awards of Common Stock to
Participants on such terms and conditions and subject to such restrictions, if
any (which may be based on continuous service with the Company or the
achievement of performance goals, as the Plan Administrator shall determine, in
its sole discretion, which terms, conditions and restrictions shall be set
forth in the instrument evidencing the Award. The terms, conditions and
restrictions that the Plan Administrator shall have the power to determine
shall include, without limitation, the manner in which shares subject to Stock
Awards are held during the periods they are subject to restrictions and the
circumstances under which forfeiture of Restricted Stock shall occur by reason
of termination of the Holder's employment or services.

9.2     ISSUANCE OF SHARES

     Upon the satisfaction of any terms, conditions and restrictions prescribed
in respect to a Stock Award, or upon the Holder's release from any terms,
conditions and restrictions of a Stock Award, as determined by the Plan
Administrator, the Company shall release, as soon as practicable, to the Holder
or, in the case of the Holder's death, to the personal representative of the
Holder's estate or as the appropriate court directs, the appropriate number of
shares of Common Stock.

9.3     WAIVER OF RESTRICTIONS

     Notwithstanding any other provisions of the Plan, the Plan Administrator
may, in its sole discretion, waive the forfeiture period and any other terms,
conditions or restrictions on any Restricted Stock under such circumstances and
subject to such terms and conditions as the Plan Administrator shall deem
appropriate.


                            SECTION 10. ASSIGNABILITY

     No Option, or Stock Award granted under the Plan may be assigned or
transferred by the Holder other than by will or by the applicable laws of
descent and distribution, and, during the Holder's lifetime, such Awards may be
exercised only by the Holder or a permitted assignee or transferee of the
Holder (as provided below). Notwithstanding the foregoing, and to the extent



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permitted by Section 422 of the Code, the Plan Administrator, in its sole
discretion, may permit such assignment, transfer and exercisability and may
permit a Holder of such Awards to designate a beneficiary who may exercise the
Award or receive compensation under the Award after the Holder's death.

                             SECTION 11. ADJUSTMENTS

11.1    ADJUSTMENT OF SHARES

     In the event that, at any time or from time to time, a stock dividend,
stock split, spin-off, combination or exchange of shares, recapitalization,
merger, consolidation, distribution to shareholders other than a normal cash
dividend or other change in the Company's corporate or capital structure
results in (a) the outstanding shares, or any securities exchanged therefor or
received in their place, being exchanged for a different number or class of
securities of the Company or of any other corporation or (b) new, different or
additional securities of the Company or of any other corporation being received
by the holders of shares of Common Stock of the Company, then the Plan
Administrator shall make proportional adjustments in (i) the maximum number and
kind of securities subject to the Plan as set forth in Section 4.1 and (ii) the
number and kind of securities that are subject to any outstanding Award and the
per share price of such securities, without any change in the aggregate price
to be paid therefor. The determination by the Plan Administrator as to the
terms of any of the foregoing adjustments shall be conclusive and binding.

11.2    CORPORATE TRANSACTION

     Except as otherwise provided in the instrument that evidences the Award,
in the event of any Corporate Transaction, each Award that is at the time
outstanding shall terminate, but each Participant shall have the right
immediately prior to any such Corporate Transaction to exercise such
Participant's Award to the extent the vesting requirements applicable to such
Award have been satisfied. Such Award shall not so terminate, however, if and
to the extent that such Award is, in connection with the Corporate Transaction,
assumed by the successor corporation or parent thereof (the "Successor
Corporation").

11.3    FURTHER ADJUSTMENT OF AWARDS

     Subject to Section 11.2, the Plan Administrator shall have the discretion,
exercisable at any time before a sale, merger, consolidation, reorganization,
liquidation or change in control of the Company, as defined by the Plan
Administrator, to take such further action as it determines to be necessary or
advisable, and fair and equitable to Participants, with respect to Awards. Such
authorized action may include (but shall not be limited to) establishing,
amending or waiving the type, terms, conditions or duration of, or restrictions
on, Awards so as to provide for earlier, later, extended or additional time for
exercise, payment or settlement or lifting restrictions, differing methods for
calculating payments or settlements, alternate forms and amounts of payments
and settlements and other modifications, and the Plan Administrator may take
such actions with respect to all Participants, to certain categories of
Participants or only to individual Participants. The Plan Administrator may
take such action before or after granting Awards to which the action



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relates and before or after any public announcement with respect to such sale,
merger, consolidation, reorganization, liquidation or change in control that is
the reason for such action.

11.4    LIMITATIONS

     The grant of Awards will in no way affect the Company's right 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.


                             SECTION 12. WITHHOLDING

     The Company may require the Holder to pay to the Company the amount of any
withholding taxes that the Company is required to withhold with respect to the
grant, exercise, payment or settlement of any Award. Subject to the Plan and
applicable law and unless the Plan Administrator determines otherwise, the
Holder may satisfy withholding obligations, in whole or in part, by paying
cash, by electing to have the Company withhold shares of Common Stock or by
transferring shares of Common Stock to the Company, in such amounts as are
equivalent to the Fair Market Value of the withholding obligation. The Company
shall have the right to withhold from any Award or any shares of Common Stock
issuable pursuant to an Award or from any cash amounts otherwise due or to
become due from the Company to the Participant an amount equal to such taxes.
The Company may also deduct from any Award any other amounts due from the
Participant to the Company or a Subsidiary.


                   SECTION 13. LOANS, INSTALLMENT PAYMENTS AND
                                LOAN GUARANTEES

     To assist a Holder (including a Holder who is an officer or a director of
the Company) in acquiring shares of Common Stock pursuant to an Award granted
under the Plan, the Plan Administrator, in its sole discretion, may authorize,
either at the Grant Date or at any time before the acquisition of Common Stock
pursuant to the Award, (a) the extension of a loan to the Holder by the
Company, (b) the payment by the Holder of the purchase price, if any, of the
Common Stock in installments, or (c) the guarantee by the Company of a loan
obtained by the grantee from a third party. The terms of any loans, installment
payments or loan guarantees, including the interest rate and terms of and
security for repayment, will be subject to the Plan Administrator's discretion;
provided, however, that any loan shall be with full recourse. Loans,
installment payments and loan guarantees may be granted with or without
security. The maximum credit available is the purchase price, if any, of the
Common Stock acquired, plus the maximum federal and state income and employment
tax liability that may be incurred in connection with the acquisition.


                  SECTION 14. AMENDMENT AND TERMINATION OF PLAN

14.1    AMENDMENT OF PLAN

     The Plan may be amended only by the Board as it shall deem advisable;
however, to the extent required for compliance with Section 422 of the Code or
any applicable law or regulation,


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approval of the shareholders will be required for any amendment that will (a)
increase the total number of shares as to which Options may be granted under
the Plan or that may be issued as Stock Awards, (b) modify the class of persons
eligible to receive Options, or (c) otherwise require shareholder approval
under any applicable law or regulation.

14.2    TERMINATION OF PLAN

     The Board may suspend or terminate the Plan at any time. The Plan will
have no fixed expiration date; provided, however, that no Incentive Stock
Options may be granted more than 10 years after the earlier of the Plan's
adoption by the Board and approval by the shareholders.

14.3    CONSENT OF HOLDER

     The amendment or termination of the Plan shall not, without the consent of
the Holder of any Award under the Plan, impair or diminish any rights or
obligations under any Award theretofore granted under the Plan. Any change or
adjustment to an outstanding Incentive Stock Option shall not, without the
consent of the Holder, be made in a manner so as to constitute a "modification"
that would cause such Incentive Stock Option to fail to continue to qualify as
an Incentive Stock Option.


                               SECTION 15. GENERAL

15.1    AWARD AGREEMENTS

     Awards granted under the Plan shall be evidenced by a written agreement
that shall contain such terms, conditions, limitations and restrictions as the
Plan Administrator shall deem advisable and that are not inconsistent with the
Plan.

15.2    CONTINUED EMPLOYMENT OR SERVICES; RIGHTS IN AWARDS

     None of the Plan, participation in the Plan as a Participant or any action
of the Plan Administrator taken under the Plan shall be construed as giving any
Participant or employee of the Company any right to be retained in the employ
of the Company or limit the Company's right to terminate the employment or
services of the Participant.

15.3    REGISTRATION

     The Company shall be under no obligation to any Participant to register
for offering or resale or to qualify for exemption under the Securities Act, or
to register or qualify under state securities laws, any shares of Common Stock,
security or interest in a security paid or issued under, or created by, the
Plan, or to continue in effect any such registrations or qualifications if
made. The Company may issue certificates for shares with such legends and
subject to such restrictions on transfer and stop-transfer instructions as
counsel for the Company deems necessary or desirable for compliance by the
Company with federal and state securities laws.

     Inability of the Company to obtain, from any regulatory body having
jurisdiction, the authority deemed by the Company's counsel to be necessary for
the lawful issuance and sale of


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any shares hereunder or the unavailability of an exemption from registration
for the issuance and sale of any shares hereunder shall relieve the Company of
any liability in respect of the nonissuance or sale of such shares as to which
such requisite authority shall not have been obtained.

     As a condition to the exercise of an Option or any other receipt of Common
Stock pursuant to an Award under the Plan, the Company may require the
Participant to represent and warrant at the time of any such exercise or
receipt that such shares are being purchased or received only for the
Participant's own account and without any present intention to sell or
distribute such shares if, in the opinion of counsel for the Company, such a
representation is required by any relevant provision of the aforementioned
laws. At the option of the Company, a stop-transfer order against any such
shares may be placed on the official stock books and records of the Company,
and a legend indicating that such shares may not be pledged, sold or otherwise
transferred, unless an opinion of counsel is provided (concurred in by counsel
for the Company) stating that such transfer is not in violation of any
applicable law or regulation, may be stamped on stock certificates in order to
ensure exemption from registration. The Plan Administrator may also require
such other action or agreement by the Participant as may from time to time be
necessary to comply with the federal and state securities laws.

15.4    NO RIGHTS AS A SHAREHOLDER

     No Award shall entitle the Holder to any cash dividend, voting or other
right of a shareholder unless and until the date of issuance under the Plan of
the shares that are the subject of such Award, free of all applicable
restrictions.

15.5    COMPLIANCE WITH LAWS AND REGULATIONS

     Notwithstanding anything in the Plan to the contrary, the Board, in its
sole discretion, may bifurcate the Plan so as to restrict, limit or condition
the use of any provision of the Plan to Participants who are officers or
directors subject to Section 16 of the Exchange Act without so restricting,
limiting or conditioning the Plan with respect to other Participants.
Additionally, in interpreting and applying the provisions of the Plan, any
Option granted as an Incentive Stock Option pursuant to the Plan shall, to the
extent permitted by law, be construed as an "incentive stock option" within the
meaning of Section 422 of the Code.

15.6    NO TRUST OR FUND

     The Plan is intended to constitute an "unfunded" plan. Nothing contained
herein shall require the Company to segregate any monies or other property, or
shares of Common Stock, or to create any trusts, or to make any special
deposits for any immediate or deferred amounts payable to any Participant, and
no Participant shall have any rights that are greater than those of a general
unsecured creditor of the Company.


<PAGE>



15.7    SEVERABILITY

     If any provision of the Plan or any Award is determined to be invalid,
illegal or unenforceable in any jurisdiction, or as to any person, or would
disqualify the Plan or any Award under any law deemed applicable by the Plan
Administrator, such provision shall be construed or deemed amended to conform
to applicable laws, or, if it cannot be so construed or deemed amended without,
in the Plan Administrator's determination, materially altering the intent of
the Plan or the Award, such provision shall be stricken as to such
jurisdiction, person or Award, and the remainder of the Plan and any such Award
shall remain in full force and effect.


                 SECTION 16. REPURCHASE AND FIRST REFUSAL RIGHTS

16.1    REPURCHASE RIGHTS

     The Plan Administrator shall have the discretion to authorize the issuance
of unvested shares of Common Stock pursuant to the exercise of an Option.
Should the Holder cease to be employed by or provide services to the Company,
then all shares of Common Stock issued upon exercise of an Option which are
unvested at the time of cessation of employment or services shall be subject to
repurchase at the exercise price paid for such shares. The terms and conditions
upon which such repurchase right shall be exercisable (including the period and
procedure for exercise) shall be established by the Plan Administrator and set
forth in the agreement evidencing such right.

     All of the Company's outstanding repurchase rights under this Section 16.1
are assignable by the Company at any time. Such rights shall automatically
terminate, and all shares subject to such terminated rights shall immediately
vest in full, upon the occurrence of a Corporate Transaction, except to the
extent: (i) any such repurchase right is expressly assigned to the Successor
Corporation in connection with the Corporate Transaction or (ii) such
termination is precluded by other limitations imposed by the Plan Administrator
at the time the repurchase right is issued.

     The Plan Administrator shall have the discretionary authority, exercisable
either before or after the Holder's cessation of employment or service, to
cancel the Company's outstanding repurchase rights with respect to one or more
shares purchased or purchasable by the Holder under an Option and thereby
accelerate the vesting of such shares in whole or in part at any time.

16.2    FIRST REFUSAL RIGHTS

     Until the date on which the initial registration of the Common Stock under
Section 12(b) or 12(g) of the Exchange Act first becomes effective, the Company
shall have the right of first refusal with respect to any proposed sale or
other disposition by the Holder of any shares of Common Stock issued pursuant
to an Award granted under the Plan. Such right of first refusal shall be
exercisable in accordance with the terms and conditions established by the Plan
Administrator and set forth in the agreement evidencing such right.



<PAGE>




                           SECTION 17. MARKET STANDOFF

     In connection with any underwritten public offering by the Company of its
equity securities pursuant to an effective registration statement filed under
the Securities Act, including the Company's initial public offering, a
Participant 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 shares issued pursuant to an Award granted under the Plan
without the prior written consent of the Company or its underwriters. Such
limitations shall be in effect for such period of time as may be requested by
the Company or such underwriters and agreed to by the Company's officers and
directors with respect to their shares; provided, however, that in no event
shall such period exceed 180 days. The limitations of this paragraph shall in
all events terminate two years after the effective date of the Company's
initial public offering. Participants shall be subject to the market standoff
provisions of this paragraph only if the officers and directors of the Company
are also subject to similar arrangements.

     In the event of any stock split, stock dividend, recapitalization,
combination of shares, exchange of shares or other change affecting the
Company's outstanding Common Stock effected as a class without the Company's
receipt of consideration, then any new, substituted or additional securities
distributed with respect to the purchased shares shall be immediately subject
to the provisions of this Section 17, to the same extent the purchased shares
are at such time covered by such provisions.

     In order to enforce the limitations of this Section 17, the Company may
impose stop-transfer instructions with respect to the purchased shares until
the end of the applicable standoff period.


                           SECTION 18. EFFECTIVE DATE

     The Plan's effective date is the date on which it is adopted by the Board,
so long as it is approved by the Company's shareholders at any time within 12
months of such adoption or, if earlier, and to the extent required for
compliance with Rule 16b-3 under the Exchange Act, at the next annual meeting
of the Company's shareholders after adoption of the Plan by the Board. Adopted
by the Board on December 5, 1997, and approved by the Company's shareholders on
December 5, 1997.


                             WEBTRENDS CORPORATION

                    INCENTIVE STOCK OPTION LETTER AGREEMENT

TO: [[First_Name]] [[Last_Name]]

     We are pleased to inform you that you have been selected by the Plan
Administrator of WebTrends Corporation's (the "Company") 1997 Stock Incentive
Compensation Plan (the "Plan") to receive an incentive stock option for the
purchase of shares of the Company's Common Stock at an exercise price of $_____
per share.

     The terms and conditions of this option are as set forth in this Agreement
and in the Plan, which is incorporated into this Agreement by reference. Terms
which are capitalized but not otherwise defined in this Agreement have the
meaning set forth in the Plan. Summaries of Plan provisions set forth in this
Agreement are not meant to supersede Plan provisions unless such provisions
conflict with the Plan provisions in which case the terms of this Agreement
govern.

     Shareholder Approval: If the Plan has not been or is not approved by the
shareholders of the Company within 12 months before of after the adoption of
the Plan, this Agreement is void in its entirety.

     Term: The term of this option is ten years from the date of grant, unless
sooner terminated.

     Vesting: Vesting shall cease upon the discontinuance of employment with or
service to the Company, upon termination of the option or in the event of
certain Corporate Transactions if the Successor Corporation does not assume
this option. Assuming vesting has not ceased, this option shall vest and become
exercisable according to the following schedule:

Date on and After Which Option Is              Portion of Total Option Which Is
          Exercisable                                  Exercisable

On or after ________________, but                           0%
on or before ________________

On or after ________________, but                           25%
on or before ________________

On or after ________________, but                           50%
on or before ________________

On or after ________________, but                           75%
on or before ________________

On or after ________________                               100%


<PAGE>

     ISO Qualification: It is possible that more than $100,000 of this option
would vest for the first time in a single calendar year. To the extent that the
aggregate fair market value of the shares with respect to which this option is
exercisable for the first time by you during any calendar year (under this
option and all other incentive stock options you hold) exceeds $100,000, the
excess portion will be treated as a nonqualified stock option, unless the
Internal Revenue Service changes the rules and regulations governing the
$100,000 limit for incentive stock options.

     Termination: Unless otherwise determined at any time by the Plan
Administrator, this option will terminate one year after termination of service
as a result of Retirement, Early Retirement at the Company's request,
Disability, or death or 30 days after all other terminations, but in each case
not later than the remaining term of this option. This option must be exercised
within three months after termination of employment for reasons other than
death or disability and one year after termination of employment due to
disability to qualify for the beneficial tax treatment afforded to incentive
stock options.

     Exercise: During your lifetime only you can exercise this option. The Plan
also provides for exercise of this option by the personal representative of
your estate or the beneficiary thereof following your death. You may use the
Notice of Exercise of Incentive Stock Option in the form attached to this
Agreement when you exercise this option.

     The Plan Administrator may, in its sole discretion at the time of
exercise, determine that the exercise of this option is subject to your
execution of an agreement, in the form in use at the time of exercise, whereby
under certain circumstances, you grant to the Company and certain investors in
the Company a right of first offer to purchase the shares acquired by you upon
exercise of this option.

     Payment for Shares: Unless the Plan Administrator at any time determines
otherwise, this option may be exercised by the delivery of:

     (a) Cash or check;

     (b) Tendering (either actually or, if and so long as the Common Stock is
registered under Section 12(b) or 12(g) of the Securities Exchange Act of 1934,
as amended (the "Exchange Act") by attestation) shares of the capital stock of
the Company held by you for a period of at least six months (or any shorter
period necessary to avoid a charge to the Company's earnings for financial
reporting purposes) having a fair market value at the time of exercise, as
determined in good faith by the Plan Administrator, equal to the exercise
price. (You should consult your tax advisor before exercising this option with
stock you received upon the exercise of an incentive stock option.); or

     (c) A properly executed exercise notice together with irrevocable
instructions to a broker to promptly deliver to the Company the amount of sale
or loan proceeds to pay the exercise price and any withholding tax obligations.


                                       -2-
<PAGE>

     Withholding Taxes: As a condition to the exercise of any portion of this
option which is treated as a nonqualified stock option, you shall make such
arrangements as the Company may require for the satisfaction of any federal,
state or local withholding tax obligations that may arise in connection with
such exercise. The Company shall have the right to retain without notice
sufficient shares of stock to satisfy the withholding obligation. Unless the
Plan Administrator determines otherwise, you may satisfy the withholding
obligation by electing to have the Company or related corporation withhold from
the shares to be issued upon exercise that number of shares having a fair
market value equal to the amount required to be withheld.

     Transfer of Option: This option is not transferable except by will or by
the applicable laws of descent and distribution.

     Holding Periods:

     a. Securities Exchange Act Section 16

     If an individual subject to Section 16 of the Exchange Act sells shares of
Common Stock obtained upon the exercise of a stock option within six months
after the date this option was granted, such sale may result in short-swing
profit recovery under Section 16(b) of the Exchange Act.

     b. Taxation of Stock Options

     In order to obtain certain tax benefits afforded to incentive stock
options under Section 422 of the Internal Revenue Code of 1986, as amended, you
must hold the shares issued upon the exercise of an incentive stock option for
two years after the date of grant of this option and one year from the date of
exercise. You may be subject to the alternative minimum tax at the time of
exercise.

     You should obtain tax advice when exercising any option and prior to the
disposition of the shares issued upon the exercise of any option.

     Registration: YOUR PARTICULAR ATTENTION IS DIRECTED TO SECTION 15.3 OF THE
PLAN, WHICH DESCRIBES CERTAIN IMPORTANT CONDITIONS RELATING TO FEDERAL AND
STATE SECURITIES LAWS THAT MUST BE SATISFIED BEFORE THIS OPTION CAN BE
EXERCISED AND BEFORE THE COMPANY CAN ISSUE ANY SHARES TO YOU. THE COMPANY HAS
NO OBLIGATION TO REGISTER THE SHARES THAT WOULD BE ISSUED UPON THE EXERCISE OF
YOUR OPTION, AND IF IT NEVER REGISTERS THE SHARES, YOU WILL NOT BE ABLE TO
EXERCISE THIS OPTION UNLESS AN EXEMPTION FROM REGISTRATION IS AVAILABLE. AT THE
PRESENT TIME, EXEMPTIONS FROM REGISTRATION UNDER FEDERAL AND STATE SECURITIES
LAWS ARE VERY LIMITED AND MIGHT BE UNAVAILABLE TO YOU PRIOR TO THE EXPIRATION
OF THIS OPTION. CONSEQUENTLY, YOU MIGHT HAVE NO OPPORTUNITY TO EXERCISE THIS
OPTION AND TO RECEIVE SHARES UPON SUCH EXERCISE.


                                       -3-
<PAGE>

     Please execute the Acceptance and Acknowledgment set forth below on the
enclosed copy of this Agreement and return it to the undersigned.

                                  Very truly yours,

                                  WEBTRENDS CORPORATION



                                  -------------------------------
                                  By:  W. Glen Boyd
                                    Its:  President













                                       -4-
<PAGE>


                         ACCEPTANCE AND ACKNOWLEDGMENT

         I, a resident of the State of -------------, accept the incentive stock
option described above and in WebTrends Corporation's 1997 Stock Incentive
Compensation Plan, and acknowledge receipt of a copy of this Agreement and a
copy of the Plan. I have read and understand the Plan, including the provisions
of Section 15.3.

Dated:
        --------------------------      -----------------------------------
                                          [[First_Name]] [[Last_Name]]

                                        Address
                                                ---------------------------
                                        -----------------------------------
----------------------------------      -----------------------------------
    Taxpayer I.D. Number

     By his or her signature below, the spouse of the Optionee, if such
Optionee is legally married as of the date of his or her execution of this
Agreement, acknowledges that he or she has read this Agreement and the Plan and
is familiar with the terms and provisions thereof, and agrees to be bound by
all the terms and conditions of this Agreement and the Plan.

Dated:
       -----------------------

                                        --------------------------------
                                        Spouse's Signature


                                        --------------------------------
                                        Printed Name

     By his or her signature below, the Optionee represents that he or she is
not legally married as of the date of execution of this Agreement.

Dated:
        -------------------------

                                        --------------------------------
                                        Optionee's Signature



<PAGE>

                  NOTICE OF EXERCISE OF INCENTIVE STOCK OPTION

To:
    -----------------------------


     I, a resident of the State of______________, hereby exercise my incentive
stock option granted by WebTrends Corporation (the "Company") on __________,
____, subject to all the terms and provisions thereof and of the 1997 Stock
Incentive Compensation Plan referred to therein, and notify the Company of my
desire to purchase _______ shares of Common Stock of the Company (the
"Securities") at the exercise price of $____ per share which were offered to me
pursuant to said option.

     I hereby represent and warrant that (1) I have been furnished with a copy
of the Plan and all information which I deem necessary to evaluate the merits
and risks of the purchase of the Securities; (2) I have had the opportunity to
ask questions and receive answers concerning the information received about the
Securities and the Company; and (3) I have been given the opportunity to obtain
any additional information I deem necessary to verify the accuracy of any
information obtained concerning the Securities and the Company.

     I am aware that the Securities have not been registered under the Federal
Securities Act of 1933 (the "1933 Act") or any state securities laws, pursuant
to exemption(s) from registration. I understand that the reliance by the
Company on such exemption(s) is predicated in part upon the truth and accuracy
of the statements by me in this Notice of Exercise.

     I hereby represent and warrant that I am purchasing the Securities for my
own personal account for investment and not with a view to the sale or
distribution of all or any part of the Securities.

     I understand that because the Securities have not been registered under
the 1933 Act, I must continue to bear the economic risk of the investment for
an indefinite time and the Securities cannot be sold unless the Securities are
subsequently registered or an exemption from registration is available.

     I agree that I will in no event sell or distribute all or any part of the
Securities unless (1) there is an effective registration statement under the
1933 Act and applicable state securities laws covering any such transaction
involving the Securities or (2) the Company receives an opinion of my legal
counsel (concurred in by legal counsel for the Company) stating that such
transaction is exempt from registration or the Company otherwise satisfies
itself that such transaction is exempt from registration.

     I consent to the placing of a legend on my certificate(s) for the
Securities stating that the Securities have not been registered and setting
forth the restriction on transfer contemplated hereby and to the placing of a
stop transfer order on the books of the Company and with any transfer agents
against the Securities until the Securities may be legally resold or
distributed.

     I understand that at the present time Rule 144 of the Securities and
Exchange Commission (the "SEC") may not be relied on for the resale or
distribution of the Securities by me. I understand that the Company has no
obligation to me to register the Securities with the SEC and has not
represented to me that it will register the Securities.

     I AM ADVISED, PRIOR TO MY PURCHASE OF THE SECURITIES, THAT NEITHER THE
OFFERING OF THE SECURITIES NOR ANY OFFERING MATERIALS HAVE BEEN REVIEWED BY ANY
ADMINISTRATOR UNDER THE SECURITIES ACT OF 1933, THE OREGON STATE SECURITIES ACT
OR ANY OTHER APPLICABLE SECURITIES ACT (THE


                                       -2-
<PAGE>

"ACTS") AND THAT THE SECURITIES HAVE NOT BEEN REGISTERED UNDER ANY OF THE ACTS
AND THEREFORE CANNOT BE RESOLD UNLESS THEY ARE REGISTERED UNDER THE ACTS OR
UNLESS AN EXEMPTION FROM SUCH REGISTRATION IS AVAILABLE.

Dated:
        --------------------------      -----------------------------------
                                          [[First_Name]] [[Last_Name]]

                                        Address
                                                ---------------------------
                                        -----------------------------------
----------------------------------      -----------------------------------
    Taxpayer I.D. Number




<PAGE>

                                    RECEIPT

     ---------------------- hereby acknowledges receipt from [[First_Name]]
[[Last_Name]] in payment for -------- shares of Common Stock of WebTrends
Corporation, an Oregon corporation, of $------------------- in the form of

                 [  ] Cash

                 [  ] Check (personal, cashier's or bank certified)

Date:
       ----------------------------     ---------------------------------
FMV on such date: $
                   ----------------     ---------------------------------