<PAGE>   1

                                                                    EXHIBIT 10.1


                                 MERCFUEL, INC.

                                 2001 STOCK PLAN


       1.     Purposes of the Plan. The purposes of this 2001 Stock Plan are:

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

              -      to provide additional incentive to Employees and Directors,
                     and

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

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

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

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

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

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

              (d) "Cause" shall mean (i) an act of personal dishonesty taken by
       the Optionee in connection with his or her responsibilities as a Service
       Provider and intended to result in substantial personal enrichment of the
       Optionee, (ii) Optionee being convicted of a felony, (iii) a willful act
       by the Optionee which constitutes gross misconduct and which is injurious
       to the Company, and (iv) following delivery to the Optionee of a written
       demand for performance from the Company which describes the basis for the
       Company's reasonable belief that the Optionee has not substantially
       performed his duties, continued violations by the Optionee of the
       Optionee's obligations to the Company which are demonstrably willful and
       deliberate on the Optionee's part.

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

                     (i)    Any "person" (as such term is used in Sections 13(d)
                            and 14(d) of the Exchange Act) becomes the
                            "beneficial owner" (as defined in Rule 13d-3 under
                            the Exchange Act), directly or indirectly, of
                            securities of the Company representing fifty percent
                            (50%) or more of the total voting power represented
                            by the Company's then outstanding voting securities
                            who is not already such as of the Effective Date; or

<PAGE>   2


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

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

                     (iv)   A change in the composition of the Board occurring
                            within a two-year period, as a result of which fewer
                            than a majority of the directors are Incumbent
                            Directors. "Incumbent Directors" shall mean
                            directors who either (A) are directors of the
                            Company as of the Effective Date, or (B) are
                            elected, or nominated for election, to the Board
                            with the affirmative votes of at least a majority of
                            those directors whose election or nomination was not
                            in connection with any transaction described in
                            subsections (i), (ii) or (iii) above, or in
                            connection with an actual or threatened proxy
                            contest relating to the election of directors to the
                            Company.

       Notwithstanding the foregoing, in no event shall either or both of the
following events constitute a Change of Control: (i) the initial public offering
of the Company's securities pursuant to a registration statement filed under
Section 12 of the Exchange Act or (ii) the spin-off of the Company from Mercury
pursuant to one or more transactions in which Mercury distributes eighty percent
(80%) or more of its securities ownership of the Company to the stockholders of
Mercury.

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

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

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

              (i) "Company" means MercFuel, Inc., a Delaware corporation.

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

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

              (l) "Effective Date" means the effective date of this Plan as
       determined in accordance with Section 7.



                                        2
<PAGE>   3


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

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

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

                     (i)    If the Common Stock is listed on any established
                            stock exchange or a national market system,
                            including without limitation the Nasdaq National
                            Market or the Nasdaq Small Cap Market of the Nasdaq
                            Stock Market, its Fair Market Value shall be the
                            closing sales price for such stock (or the closing
                            bid, if no sales were reported) as quoted on such
                            exchange or system for the last market trading day
                            prior to the time of determination, as reported in
                            The Wall Street Journal or such other source as the
                            Administrator deems reliable;

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

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

                     (iv)   For purposes of Option grants made on the effective
                            date of the Company's initial public offering of
                            Common Stock, the Fair Market Value shall be the
                            initial price to the public as set forth in the
                            final prospectus included with the registration on
                            Form S-1 filed with the Securities and Exchange
                            Commission for such offering.

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



                                       3
<PAGE>   4


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

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

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

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

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

              (v) "Option Exchange Program" means a program whereby outstanding
       Options are surrendered in exchange for Options with a lower exercise
       price.

              (w) "Optioned Stock" means the Common Stock subject to an Option.

              (x) "Optionee" means the holder of an outstanding Option granted
       under the Plan.

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

              (z) "Plan" means this 2001 Stock Plan.

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

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

              (cc) "Service Provider" means an Employee or Director. In
       addition, an individual who receives an award under this Plan while an
       Employee or Director, and who ceases to be an Employee or Director, but
       who remains an Employee or Director to Mercury shall be deemed Service
       Provider for purposes of this Plan.

              (dd) "Share" means a share of the Common Stock, as adjusted in
       accordance with Section 13 of the Plan.

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

              (ff) "Mercury" means Mercury Air Group, Inc., a Delaware
       corporation.


                                       4
<PAGE>   5

       3. Stock Subject to the Plan. Subject to the provisions of Section 13 of
the Plan, the maximum aggregate number of Shares that may be optioned and sold
under the Plan is __________.

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

       4.     Administration of the Plan.

              (a)    Procedure.

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

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

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

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

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

                     (i)    to determine the Fair Market Value;

                     (ii)   to select the Employees and Directors to whom
                            Options may be granted hereunder;

                     (iii)  to determine the number of shares of Common Stock to
                            be covered by each Option granted hereunder;

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


                                       5
<PAGE>   6

                     (v)    to determine the terms and conditions, not
                            inconsistent with the terms of the Plan, of any
                            Option granted hereunder. Such terms and conditions
                            include, but are not limited to, the exercise price,
                            the time or times when Options may be exercised
                            (which may be based on performance criteria), any
                            vesting acceleration or waiver of forfeiture
                            restrictions, and any restriction or limitation
                            regarding any Option or the shares of Common Stock
                            relating thereto, based in each case on such factors
                            as the Administrator, in its sole discretion, shall
                            determine;

                     (vi)   to reduce the exercise price of any Option to the
                            then current Fair Market Value if the Fair Market
                            Value of the Common Stock covered by such Option
                            shall have declined since the date the Option was
                            granted;

                     (vii)  to institute an Option Exchange Program;

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

                     (ix)   to prescribe, amend and rescind rules and
                            regulations relating to the Plan, including rules
                            and regulations relating to sub-plans established
                            for the purpose of qualifying for preferred
                            treatment under foreign laws;

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

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

                     (xii)  to authorize any person to execute on behalf of the
                            Company any instrument required to effect the grant
                            of an Option previously granted by the
                            Administrator;

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

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

                                       6
<PAGE>   7

       5. Eligibility. Nonstatutory Stock Options may be granted to Employees or
Directors. Incentive Stock Options may be granted only to Employees.

       6. Limitations.

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

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

       7. Term of Plan. Subject to Section 19 of the Plan, the Plan shall become
effective upon its adoption by the Board. It shall continue in effect for a term
of ten (10) years unless terminated earlier under Section 15 of the Plan.

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

       9. Option Exercise Price and Consideration.

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

                     (i)    In the case of an Incentive Stock Option

                            (A)    granted to an Employee who, at the time the
                                   Incentive Stock Option is granted, owns stock
                                   representing more then ten percent (10%) of
                                   the voting power of all classes of stock of
                                   the Company or any Parent or Subsidiary, the
                                   per Share exercise price shall be no less
                                   than 110% of the Fair Market Value per Share
                                   on the date of grant.


                                       7
<PAGE>   8

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

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

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

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

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

                     (i)    cash;

                     (ii)   check;

                     (iii)  promissory note;

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

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

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

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

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



                                       8
<PAGE>   9



       10. Exercise of Option.

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

              An Option shall be deemed exercised when the Company receives: (i)
       written or electronic notice of exercise (in accordance with the Option
       Agreement) from the person entitled to exercise the Option, and (ii) full
       payment for the Shares with respect to which the Option is exercised.
       Full payment may consist of any consideration and method of payment
       authorized by the Administrator and permitted by the Option Agreement and
       the Plan. Shares issued upon exercise of an Option shall be issued in the
       name of the Optionee or, if requested by the Optionee, in the name of the
       Optionee and his or her spouse. Until the Shares are issued (as evidenced
       by the appropriate entry on the books of the Company or of a duly
       authorized transfer agent of the Company), no right to vote or receive
       dividends or any other rights as a shareholder shall exist with respect
       to the Optioned Stock, notwithstanding the exercise of the Option. The
       Company shall issue (or cause to be issued) such Shares promptly after
       the Option is exercised. No adjustment will be made for a dividend or
       other right for which the record date is prior to the date the Shares are
       issued, except as provided in Section 13 of the Plan.

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

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

              (c) Disability of Optionee. If an Optionee ceases to be a Service
       Provider as a result of the Optionee's Disability, the Optionee may
       exercise his or her Option within such period of time as is specified in
       the Option Agreement to the extent the Option is vested on the date of
       termination (but in no event later than the expiration of the term of
       such Option as set forth in the Option Agreement). In the absence of a
       specified time in the Option Agreement, the Option shall remain
       exercisable for twelve (12) months



                                       9
<PAGE>   10


       following the Optionee's termination. If, in the date of termination, the
       Optionee is not vested as to his or her entire Option, the Shares covered
       by the unvested portion of the Option shall revert to the Plan. If, after
       termination, the Optionee does not exercise his or her Option within the
       time specified herein, the Option shall terminate, and the Shares covered
       by such Option shall revert to the Plan. (d) Death of Optionee. If an
       Optionee dies while a Service Provider, the Option may be exercised
       within such period of time as is specified in the Option Agreement (but
       in no event later than the expiration of the term of such Option as set
       forth in the Notice of Grant) but only to the extent that the Option is
       vested on the date of death. In the absence of a specified time in the
       Option Agreement, the Option shall remain exercisable for twelve (12)
       months following the Optionee's death. The Option may be exercised by the
       Optionee's designated beneficiary, provided such beneficiary has been
       designated prior to Optionee's death in a form acceptable by the
       Administrator. If no such beneficiary has been designated by the
       Optionee, then such Option may be exercised within the applicable time
       period by the personal representative of the Optionee's estate or by the
       person or persons to whom the Option is transferred pursuant to the
       Optionee's will or in accordance with the laws of descent and
       distribution. If, at the time of death, the Optionee is not vested as to
       his or her entire Option, the Shares covered by the unvested portion of
       the Option shall immediately revert to the Plan. If the Option is not so
       exercised within the time specified herein, the Option shall terminate,
       and the Shares covered by such Option shall revert to the Plan.

              (e) Buyout Provisions. The Administrator may at any time offer to
       buy our for a payment in cash or Shares an Option previously granted
       based on such terms and conditions as the Administrator shall establish
       and communicate to the Optionee as the time that such offer is made.

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

       12. Adjustments Upon Changes in Capitalization, Dissolution, Merger or
Asset Sale.

              (a) Changes in Capitalization. Subject to any required action by
       the shareholders of the Company, the number of shares of Common Stock
       which have been authorized for issuance under the Plan, including Shares
       as to which no Options have yet been granted or which have been returned
       to the Plan upon cancellation or expiration of an Option and the number
       of shares of Common Stock covered by each outstanding Option as well as
       the price per share of Common Stock covered by each such outstanding
       Option, shall be proportionately adjusted for any increase or decrease in
       the number of issued shares of Common Stock resulting from a stock split,
       reverse stock split, stock dividend, combination or reclassification of
       the Common Stock, or any other increase or decrease in the number of
       issued shares of Common Stock effected without receipt of



                                       10
<PAGE>   11

       consideration by the Company; provided, however, that conversion of any
       convertible securities of the Company shall not be deemed to have been
       "effected without receipt of consideration". Such adjustment shall be
       made by the Board, whose determination in that respect shall be final,
       binding and conclusive. Except as expressly provided herein, no issuance
       by the Company of shares of stock of any class, or securities convertible
       into shares of stock of any class, shall affect, and no adjustment by
       reason thereof shall be made with respect to, the number or price of
       shares of Common Stock subject to an Option.

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

              (c) Merger or Asset Sale. In the event of a merger of the Company
       into or with another corporation, or the sale of substantially all of the
       assets of the Company, each outstanding Option shall be assumed or an
       equivalent option or right substituted by the successor corporation or a
       Parent or Subsidiary of the successor corporation. In the event that the
       successor corporation refuses to assume or substitute for the Option, the
       Optionee shall fully vest in and have the right to exercise the Option as
       to all of the Optioned Stock, including Shares as to which it would not
       otherwise be vested or exercisable. If an Option becomes fully vested and
       exercisable in lieu of assumption or substitution in the event of a
       merger or sale of assets, the Administrator shall notify the Optionee in
       writing or electronically that the Option shall be fully vested and
       exercisable for a period of fifteen (15) days from the date of such
       notice, and the Option shall terminate upon the expiration of such
       period. For the purposes of this paragraph, the Option shall be
       considered assumed if, following the merger or sale of assets, the option
       or right confers the right to purchase or receive, for each Share of
       Optioned Stock subject to the Option immediately prior to the merger or
       sale of assets, the consideration (whether stock, cash, or other
       securities or property) received in the merger or sale of assets by
       holders of Common Stock for each Share held on the effective date of the
       transaction (and if holders were offered a choice of consideration, the
       type of consideration chosen by the holders of a majority of the
       outstanding Shares); provided, however, that if such consideration
       received in the merger or sale of assets is not solely common stock of
       the successor corporation or its Parent, the Administrator may, with the
       consent of the successor corporation, provide for the consideration to be
       received upon the exercise of the Option, for each Share of Optioned
       Stock subject to the Option, to be solely common stock of the successor
       corporation to its Parent equal in fair market value to the per share
       consideration received by holders of Common Sock in the merger or sale of
       assets.


                                       11
<PAGE>   12

       Notwithstanding the foregoing, if an Optionee's status as a Service
Provider is terminated for reasons other than Cause within twelve (12) months
following a Change of Control, then the vesting and exercisability of each of
the Optionee's outstanding Options and Stock Purchase Rights shall partially
accelerate upon such termination with respect to fifty percent (50%) of the then
unvested Shares subject to or acquired under each such Option.

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

       14. Amendment and Termination of the Plan.

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

              (b) Shareholder Approval. The Company shall obtain shareholder
       approval of any Plan amendment to the extent necessary and desirable to
       comply with Applicable Laws.

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

       15. Conditions Upon Issuance of Shares.

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

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

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



                                       12
<PAGE>   13


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

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



                                       13