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                                                                    EXHIBIT 10.1
                                 1ST STEP, INC.

                           2002 EQUITY INCENTIVE PLAN

As Adopted March 31, 2002

1.       PURPOSE.

         The purpose of this Plan is to provide incentives to attract, retain
and motivate eligible persons whose present and potential contributions are
important to the success of the Company, its Parent and Subsidiaries, by
offering them an opportunity to participate in the Company's future performance
through awards of Options, Restricted Stock and Stock Bonuses. Capitalized terms
not defined in the text are defined in Section 2.

2.       DEFINITIONS.

         As used in this Plan, the following terms will have the following
meanings:

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

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

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

         "CAUSE" means any cause, as defined by applicable law, for the
termination of a Participant's employment with the Company or a Parent or
Subsidiary of the Company.

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

         "COMMITTEE" means the Compensation Committee of the Board.

         "COMPANY" means 1st Step, Inc., a Delaware corporation, or any
successor corporation.

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

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

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

         "FAIR MARKET VALUE" means, as of any date, the value of a share of the
Company's Common Stock determined as follows:

                  (a)      if such Common Stock is publicly traded and is then
                           listed on a national securities exchange, its closing
                           price on the date of determination on the principal
                           national securities exchange on which the Common
                           Stock is listed or admitted to trading as reported in
                           THE WALL STREET JOURNAL;

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                  (b)      if such Common Stock is quoted on the NASDAQ National
                           Market, its closing price on the NASDAQ National
                           Market on the date of determination as reported in
                           THE WALL STREET JOURNAL;

                  (c)      if such Common Stock is publicly traded but is not
                           listed or admitted to trading on a national
                           securities exchange, the average of the closing bid
                           and asked prices on the date of determination as
                           reported in THE WALL STREET JOURNAL;

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

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

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

         "OPTION" means an award of an option to purchase Shares pursuant to
Section 6.

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

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

         "PERFORMANCE FACTORS" means the factors selected by the Committee, in
its sole and absolute discretion, from among the following measures to determine
whether the performance goals applicable to Awards have been satisfied:

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

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

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

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

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

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

                  (g)      Return on equity;

                  (h)      Operating cash flow return on income;

                  (i)      Adjusted operating cash flow return on income;

                  (j)      Economic value added; and

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                  (k)      Individual confidential business objectives.

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

         "PLAN" means this 1st Step, Inc. 2002 Equity Incentive Plan, as amended
from time to time.

         "RESTRICTED STOCK AWARD" means an award of Shares pursuant to Section
7.

         "SEC" means the Securities and Exchange Commission.

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

         "SHARES" means shares of the Company's Common Stock reserved for
issuance under this Plan, as adjusted pursuant to Sections 3 and 19, and any
successor security.

         "STOCK BONUS" means an award of Shares, or cash in lieu of Shares,
pursuant to Section 8.

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

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

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

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

3.       SHARES SUBJECT TO THE PLAN.

         3.1 NUMBER OF SHARES AVAILABLE. Subject to Sections 3.2 and 19, the
total aggregate number of Shares reserved and available for grant and issuance
pursuant to this Plan will be 1,000,000 plus Shares that are subject to: (a)
issuance upon exercise of an Option but cease to be subject to such Option for
any reason other than exercise of such Option; (b) an Award granted hereunder
but forfeited or repurchased by the Company at the original issue price; and (c)


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an Award that otherwise terminates without Shares being issued. At all times the
Company shall reserve and keep available a sufficient number of Shares as shall
be required to satisfy the requirements of all outstanding Options granted under
this Plan and all other outstanding but unvested Awards granted under this Plan.

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

4.       ELIGIBILITY.

          ISOs (as defined in Section 6 below) may be granted only to employees
(including officers and directors who are also employees) of the Company or of a
Parent or Subsidiary of the Company. All other Awards may be granted to
employees, officers, directors, consultants, independent contractors and
advisors of the Company or any Parent or Subsidiary of the Company; provided
such consultants, contractors and advisors render bona fide services not in
connection with the offer and sale of securities in a capital-raising
transaction.

5.       ADMINISTRATION.

         5.1 COMMITTEE AUTHORITY. This Plan will be administered by the
Committee or by the Board acting as the Committee. Subject to the general
purposes, terms and conditions of this Plan, and to the direction of the Board,
the Committee will have full power to implement and carry out this Plan. Without
limitation, the Committee will have the authority to:

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

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

                  (c)      select persons to receive Awards;

                  (d)      determine the form and terms of Awards;

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

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

                  (g)      grant waivers of Plan or Award conditions;

                  (h)      determine the vesting, ability to exercise and
                           payment of Awards;

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

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

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

         5.2 COMMITTEE DISCRETION. Any determination made by the Committee with
respect to any Award will be made at the time of grant of the Award or, unless
in contravention of any express term of this Plan or Award, at any later time,
and such determination will be final and binding on the Company and on all
persons having an interest in any Award under this Plan. The Committee may
delegate to one or more officers of the Company the authority to grant an Award
under this Plan to Participants who are not Insiders of the Company.

6.       OPTIONS.

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

         6.1 FORM OF OPTION GRANT. Each Option granted under this Plan will be
evidenced by an Award Agreement that will expressly identify the Option as an
ISO or an NQSO (hereinafter referred to as the "STOCK OPTION AGREEMENT"), and
will be in such form and contain such provisions (which need not be the same for
each Participant) as the Committee may from time to time approve, and which will
comply with and be subject to the terms and conditions of this Plan.

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

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

         6.4 EXERCISE PRICE. The Exercise Price of an Option will be determined
by the Committee when the Option is granted and may be not less than 85% of the
Fair Market Value of the Shares on the date of grant; provided that: (a) the
Exercise Price of an ISO will be not less than 100% of the Fair Market Value of
the Shares on the date of grant; and (b) the Exercise Price of any ISO granted
to a Ten Percent Stockholder will not be less than 110% of the Fair Market Value
of the Shares on the date of grant. Payment for the Shares purchased may be made
in accordance with Section 9 of this Plan.

         6.5 METHOD OF EXERCISE. Options may be exercised only by delivery to
the Company of a written stock option exercise agreement (the "EXERCISE
AGREEMENT") in a form approved by the Committee, (which need not be the same for
each Participant), stating the number of Shares being purchased, the
restrictions imposed on the Shares purchased under such Exercise Agreement, if
any, and such representations and agreements regarding Participant's investment


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intent and access to information and other matters, if any, as may be required
or desirable by the Company to comply with applicable securities laws, together
with payment in full of the Exercise Price for the number of Shares being
purchased.

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

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

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

     (c) Notwithstanding the provisions in paragraph 6.6(a) above, if a
     Participant's service is Terminated for Cause, neither the Participant, the
     Participant's estate nor such other person who may then hold the Option
     shall be entitled to exercise any Option with respect to any Shares
     whatsoever, after Termination, whether or not after Termination the
     Participant may receive payment from the Company or Subsidiary for vacation
     pay, for services rendered prior to Termination, for services rendered for
     the day on which Termination occurs, for salary in lieu of notice, or for
     any other benefits. For the purpose of this paragraph, Termination shall be
     deemed to occur on the date when the Company dispatches notice or advice to
     the Participant that his service is Terminated.

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

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

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         6.9 MODIFICATION, EXTENSION OR RENEWAL. The Committee may modify,
extend or renew outstanding Options and authorize the grant of new Options in
substitution therefor, provided that any such action may not, without the
written consent of a Participant, impair any of such Participant's rights under
any Option previously granted. Any outstanding ISO that is modified, extended,
renewed or otherwise altered will be treated in accordance with Section 424(h)
of the Code. The Committee may reduce the Exercise Price of outstanding Options
without the consent of Participants affected by a written notice to them;
provided, however, that the Exercise Price may not be reduced below the minimum
Exercise Price that would be permitted under Section 6.4 of this Plan for
Options granted on the date the action is taken to reduce the Exercise Price.

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

7.       RESTRICTED STOCK.

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

         7.1 FORM OF RESTRICTED STOCK AWARD. All purchases under a Restricted
Stock Award made pursuant to this Plan will be evidenced by an Award Agreement
(the "RESTRICTED STOCK PURCHASE AGREEMENT") that will be in such form (which
need not be the same for each Participant) as the Committee will from time to
time approve, and will comply with and be subject to the terms and conditions of
this Plan. The offer of Restricted Stock will be accepted by the Participant's
execution and delivery of the Restricted Stock Purchase Agreement and full
payment for the Shares to the Company within thirty (30) days from the date the
Restricted Stock Purchase Agreement is delivered to the person. If such person
does not execute and deliver the Restricted Stock Purchase Agreement along with
full payment for the Shares to the Company within thirty (30) days, then the
offer will terminate, unless otherwise extended by the Committee.

         7.2 PURCHASE PRICE. The Purchase Price of Shares sold pursuant to a
Restricted Stock Award will be determined by the Committee on the date the
Restricted Stock Award is granted, except in the case of a sale to a Ten Percent
Stockholder, in which case the Purchase Price will be 100% of the Fair Market
Value. Payment of the Purchase Price must be made in accordance with Section 9
of this Plan.

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

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

8.       STOCK BONUSES.

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

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

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

9.       PAYMENT FOR SHARE PURCHASES.

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

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

                  (b)      by surrender of shares that either: (1) have been
                           owned by Participant for more than six (6) months and
                           have been paid for within the meaning of Rule 144 of
                           the Securities Act of 1933 (and, if such shares were
                           purchased from the Company by use of a promissory
                           note, such note has been fully paid with respect to
                           such shares); or (2) were obtained by Participant in
                           the public market;

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

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

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

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

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

                  (f)      by any combination of the foregoing.

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

10.      WITHHOLDING TAXES.

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

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

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11.      PRIVILEGES OF STOCK OWNERSHIP.

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

         11.2 FINANCIAL STATEMENTS. Pursuant to regulation 260.140.46 of the
Rules of the California Corporations Commissioner, the Company will provide
financial statements to each Participant prior to such Participant's purchase of
Shares under this Plan, and to each Participant annually during the period such
Participant has Awards outstanding; provided, however, the Company will not be
required to provide such financial statements to Participants whose services in
connection with the Company assure them access to equivalent information.

12.      TRANSFERABILITY.

         Awards granted under this Plan, and any interest therein, will not be
transferable or assignable by Participant, and may not be made subject to
execution, attachment or similar process, other than by will or by the laws of
descent and distribution. During the lifetime of the Participant an Award will
be exercisable only by the Participant. During the lifetime of the Participant,
any elections with respect to an Award may be made only by the Participant
unless otherwise determined by the Committee and set forth in the Award
Agreement with respect to Awards that are not ISOs.

13.      RESTRICTIONS ON SHARES.

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

14.      CERTIFICATES.

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

15.      ESCROW; PLEDGE OF SHARES.

         To enforce any restrictions on a Participant's Shares, the Committee
may require the Participant to deposit all certificates representing Shares,
together with stock powers or other instruments of transfer approved by the
Committee appropriately endorsed in blank, with the Company or an agent
designated by the Company to hold in escrow until such restrictions have lapsed
or terminated, and the Committee may cause a legend or legends referencing such
restrictions to be placed on the certificates. Any Participant who is permitted


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to execute a promissory note as partial or full consideration for the purchase
of Shares under this Plan will be required to pledge and deposit with the
Company all or part of the Shares so purchased as collateral to secure the
payment of Participant's obligation to the Company under the promissory note;
provided, however, that the Committee may require or accept other or additional
forms of collateral to secure the payment of such obligation and, in any event,
the Company will have full recourse against the Participant under the promissory
note notwithstanding any pledge of the Participant's Shares or other collateral.
In connection with any pledge of the Shares, Participant will be required to
execute and deliver a written pledge agreement in such form as the Committee
will from time to time approve. The Shares purchased with the promissory note
may be released from the pledge on a pro rata basis as the promissory note is
paid.

16.      EXCHANGE AND BUYOUT OF AWARDS.

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

17.      SECURITIES LAW AND OTHER REGULATORY COMPLIANCE.

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

18.      NO OBLIGATION TO EMPLOY.

          Nothing in this Plan or any Award granted under this Plan will confer
or be deemed to confer on any Participant any right to continue in the employ
of, or to continue any other relationship with, the Company or any Parent or
Subsidiary of the Company or limit in any way the right of the Company or any
Parent or Subsidiary of the Company to terminate Participant's employment or
other relationship at any time, with or without cause.

19.      CORPORATE TRANSACTIONS.

         19.1 ASSUMPTION OR REPLACEMENT OF AWARDS BY SUCCESSOR. In the event of
(a) a dissolution or liquidation of the Company, (b) a merger or consolidation
in which the Company is not the surviving corporation (other than a merger or
consolidation with a wholly-owned subsidiary, a reincorporation of the Company
in a different jurisdiction, or other transaction in which there is no
substantial change in the stockholders of the Company or their relative stock
holdings and the Awards granted under this Plan are assumed, converted or
replaced by the successor corporation, which assumption will be binding on all
Participants), (c) a merger in which the Company is the surviving corporation
but after which the stockholders of the Company immediately prior to such merger


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(other than any stockholder that merges, or which owns or controls another
corporation that merges, with the Company in such merger) cease to own their
shares or other equity interest in the Company, (d) the sale of substantially
all of the assets of the Company, or (e) the acquisition, sale, or transfer of
more than 50% of the outstanding shares of the Company by tender offer or
similar transaction, any or all outstanding Awards may be assumed, converted or
replaced by the successor corporation (if any), which assumption, conversion or
replacement will be binding on all Participants. In the alternative, the
successor corporation may substitute equivalent Awards or provide substantially
similar consideration to Participants as was provided to stockholders (after
taking into account the existing provisions of the Awards). The successor
corporation may also issue, in place of outstanding Shares of the Company held
by the Participant, substantially similar shares or other property subject to
repurchase restrictions no less favorable to the Participant. In the event such
successor corporation (if any) refuses to assume or substitute Awards, as
provided above, pursuant to a transaction described in this Subsection 19.1,
such Awards will expire on such transaction at such time and on such conditions
as the Committee will determine. Notwithstanding anything in this Plan to the
contrary, the Committee may provide that the vesting of any or all Awards
granted pursuant to this Plan will accelerate upon a transaction described in
this Section 19. If the Committee exercises such discretion with respect to
Options, such Options will become exercisable in full prior to the consummation
of such event at such time and on such conditions as the Committee determines,
and if such Options are not exercised prior to the consummation of the corporate
transaction, they shall terminate at such time as determined by the Committee.

         19.2 OTHER TREATMENT OF AWARDS. Subject to any greater rights granted
to Participants under the foregoing provisions of this Section 19, in the event
of the occurrence of any transaction described in Section 19.1, any outstanding
Awards will be treated as provided in the applicable agreement or plan of
merger, consolidation, dissolution, liquidation, or sale of assets.

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

20.      ADOPTION AND STOCKHOLDER APPROVAL.

         This Plan will become effective on the date on which it is adopted by
the Board (the "EFFECTIVE DATE"). This Plan shall be approved by the
stockholders of the Company within twelve (12) months before or after the date
this Plan is adopted by the Board. Upon the Effective Date, the Committee may
grant Awards pursuant to this Plan; provided, however, that: (a) no Option may
be exercised prior to stockholder approval of this Plan; (b) no Option granted
pursuant to an increase in the number of Shares subject to this Plan approved by
the Board will be exercised prior to the time such increase has been approved by
the stockholders of the Company; (c) in the event that stockholder approval of


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

21.      TERM OF PLAN/GOVERNING LAW.

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

22.      AMENDMENT OR TERMINATION OF PLAN.

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

23.      NONEXCLUSIVITY OF THE PLAN.

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

24.      ACTION BY COMMITTEE.

         Any action permitted or required to be taken by the Committee or any
decision or determination permitted or required to be made by the Committee
pursuant to this Plan shall be taken or made in the Committee's sole and
absolute discretion.


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