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                                                                     Exhibit 4.3



                            ASCENDANT SOLUTIONS, INC.

                           2002 EQUITY INCENTIVE PLAN

                             Adopted March 14, 2002

         1.       PURPOSE OF THE PLAN.

         The purpose of the Plan is to provide a means by which selected
Employees of and Consultants to the Company and its Affiliates may be given an
opportunity to acquire a proprietary interest in the Company. Under the Plan,
the Company may provide various types of long-term incentive awards, including
Options, Stock Appreciation Rights, Restricted Stock, Deferred Stock, Stock
Reload Options and Other Stock-Based Awards, in order to retain the services of
Persons who are now Employees of or Consultants to the Company and its
Affiliates, to secure and retain the services of new Employees and Consultants,
and to provide incentives for such Persons to exert maximum efforts for the
success of the Company and its Affiliates. Options granted under the Plan may be
Incentive Stock Options or Nonqualified Stock Options, as determined by the
Committee at the time of grant of an Option and subject to the applicable
provisions of Section 422 of the Code and the regulations promulgated
thereunder.

         2.       DEFINITIONS.

         As used herein, the following definitions shall apply:

         (a)      "Affiliate" means, with respect to any Person, any Parent or
Subsidiary of such Person, whether such Parent or Subsidiary is now or hereafter
existing.

         (b)      "Agreement" means the agreement (including an Option
Agreement) between the Company and the Holder setting forth the terms and
conditions of an Award under the Plan.

         (c)      "Applicable Laws" means all applicable federal, state, local
or foreign laws, statutes, regulations and legal requirements, including without
limitation the requirements of the Stock Exchange and the legal requirements
relating to the administration of stock option plans and equity incentive plans
(and the issuance of shares of capital stock thereunder) under U.S. state
corporate laws, U.S. federal and state securities laws, the Code and the
applicable laws of any foreign country or jurisdiction where any Awards are, or
will be, granted under the Plan.

         (d)      "Award" means an award of Options, Stock Appreciation Rights,
Restricted Stock, Deferred Stock, Stock Reload Options or Other Stock-Based
Awards under the Plan.

         (e)      "Beneficial Owner" means a "beneficial owner" as such term is
used in Rule 13d-3 promulgated under the Exchange Act.

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

         (g)      "Change of Control" means, with respect to any Award, the
occurrence at any time after the date of grant of such Award of (i) any Person
or Group of Persons becoming for the first time the Beneficial Owner, directly
or indirectly, of more than fifty percent (50%) of the total combined voting
power of all classes of capital stock of the Company normally entitled to vote
for the election of directors of the Company ("Voting Stock"), other than as a
result of a transfer or series of related transfers of Voting Stock from a
Person or Group of Persons who immediately prior to such transfer or transfers
was

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the Beneficial Owner, and who after giving effect to such transfer or transfers
continues to be the Beneficial Owner, of more than fifty percent (50%) of the
Voting Stock of the Company; (ii) a merger or consolidation of the Company with
or into another Person or the merger of another Person into the Company as a
consequence of which those Persons who held all of the Voting Stock of the
Company immediately prior to such merger or consolidation do not hold either
directly or indirectly a majority of the Voting Stock of the Company (or, if
applicable, the surviving company of such merger or consolidation) after the
consummation of such merger or consolidation; (iii) the sale of all or
substantially all of the assets of the Company to any Person or Group of Persons
(other than to (A) a Person or Group of Persons which owns, directly or
indirectly, a majority or more of the Common Stock of the Company, (B) a
Subsidiary of the Company, or (C) a Person all of whose equity interests are
owned directly or indirectly by the Company); or (iv) any event or series of
events (which event or series of events must include a proxy fight or proxy
solicitation with respect to the election of directors of the Company made in
opposition to the nominees recommended by the Continuing Directors) during any
period of 12 consecutive months, as a result of which a majority of the Board
consists of individuals other than Continuing Directors.

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

         (i)      "Committee" means (a) the compensation committee (the
"Compensation Committee") of the Board (or in the event that there is not a
Compensation Committee, then the Board) with respect to Awards granted to all
Employees and Consultants of the Company (other than Non-Employee Directors of
the Company) and (b) the entire Board (regardless of whether there is a
Compensation Committee) with respect to Awards granted to Non-Employee Directors
of the Company. During any period of time in which the Company is subject to the
reporting requirements of the Exchange Act, the Compensation Committee shall be
comprised solely of not less than two members, each of whom shall be (i) a
Non-Employee Director and (ii) unless otherwise determined by the Board, an
"outside director" within the meaning of Treasury Regulation Section
1.162-27(e)(3) under Section 162(m) of the Code. Appointment of Compensation
Committee members shall be effective upon acceptance of appointment.
Compensation Committee members may be removed by the Board at any time and may
resign at any time. Vacancies in the Compensation Committee shall be filled by
the Board.

         (j)      "Common Stock" means the common stock, par value $.0001 per
share, of the Company.

         (k)      "Company" means Ascendant Solutions, Inc., a Delaware
corporation.

         (l)      "Consultant" means (i) any Person who is engaged by the
Company or any Affiliate of the Company to render consulting or advisory
services and is compensated for such services and (ii) any Director of the
Company, whether such Director is compensated for such services or not.

         (m)      "Continuing Directors of the Company" means, with the respect
to any period of 12 consecutive months, (i) any members of the Board on the
first day of such period, (ii) any members of the Board elected after the first
day of such period at any annual meeting of shareholders who were nominated by
the Board or a committee thereof, if a majority of the members of the Board or
such committee were Continuing Directors of the Company within the meaning of
clause (i) above at the time of such nomination, and (iii) any members of the
Board elected to succeed Continuing Directors of the Company by the Board or a
committee thereof, if a majority of the members of the Board or such committee
were Continuing Directors of the Company within the meaning of clause (i) or
(ii) above at the time of such election.

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         (n)      "Continuous Status as an Employee or Consultant" means that
the employment or consulting relationship that an Employee or Consultant has
with the Company or any Affiliate is not interrupted or terminated. Continuous
Status as an Employee or Consultant shall not be considered interrupted in the
case of (i) any leave of absence approved in writing by the Company or any
Affiliate or (ii) transfers between locations of the Company or between the
Company or any Affiliate or any successor. A leave of absence approved by the
Company shall include sick leave, military leave, or any other personal leave
approved by an authorized representative of the Company or any Affiliate. For
purposes of Incentive Stock Options, no such leave may exceed 90 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 or
any Affiliate is not so guaranteed, on the 91st day of such leave any Incentive
Stock Option held by the Holder shall cease to be treated for tax purposes as an
Incentive Stock Option and shall be treated for tax purposes as a Nonqualified
Stock Option.

         (o)      "Corporate Affiliate" means, with respect to any Person, any
Parent Corporation or Subsidiary Corporation of such Person, whether such Parent
Corporation or Subsidiary Corporation is now or hereafter existing.

         (p)      "Deferred Stock" means the Shares of Common Stock to be
received at the end of a specified deferral period under an Award made pursuant
to Section 10 below.

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

         (r)      "Director Fee Investment Option Grant Program" means the
director fee investment option grant program in effect under Section 11 of the
Plan.

         (s)      "Disability" shall have the meaning given it or any similar
term in the employment agreement of the Holder with the Company or an Affiliate;
provided, however, that if that Holder has no such employment agreement or if
the employment agreement applicable to the Holder does not specify the meaning
of such term, "Disability" shall mean "disability" as such term is defined in
Section 22(e)(3) of the Code.

         (t)      "Employee" means any individual Person, including Officers and
Directors, employed by the Company or any Affiliate of the Company. The payment
of a Director's fee or the reimbursement of a Director's expenses by the Company
shall not be sufficient to constitute "employment" by the Company.

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

         (v)      "Fair Market Value" means the value of a Share of Common Stock
determined as follows:

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

                  (ii)     If the Common Stock is not listed on any established
         stock exchange or quoted on a national market system, but is regularly
         quoted by a recognized securities dealer (whose selling prices are not
         reported), its Fair Market Value shall be the mean between the high bid
         and

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         low asked prices for the Common Stock on the last market trading day
         prior to the date of determination; or

                  (iii)    In the absence of an established market for the
         Common Stock, the Fair Market Value thereof shall be the value
         determined in good faith by the Committee.

         (w)      "Group" means a "group" as such term is used in Section
13(d)(3) of the Exchange Act.

         (x)      "Holder" means a Person who has received an Award under the
Plan.

         (y)      "Immediate Family Members" means (a) the children,
grandchildren, spouse, siblings (and their spouses) or parents of the Holder or
(b) any bona fide trusts, partnerships or other entities controlled by the
Holder or one or more Immediate Family Members, or whose beneficiaries are the
Holder and/or one or more Immediate Family Members of the Holder.

         (z)      "Incentive Stock Option" means an Option intended to qualify
as an incentive stock option within the meaning of Section 422 of the Code.

         (aa)     "IPO Date" means the closing date of the first sale to the
public of the Company's Common Stock pursuant to an effective registration
statement under the Securities Act of 1933, as amended.

         (bb)     "Non-Employee Director" means a "Non-Employee Director" within
the meaning of Rule 16b-3.

         (cc)     "Nonqualified Stock Option" means an Option not intended to
qualify as an Incentive Stock Option.

         (dd)     "Officer" means an individual 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.

         (ee)     "Option" means any option to purchase Shares of Common Stock
which is granted pursuant to the Plan (including any options granted pursuant to
Section 11 hereof).

         (ff)     "Option Agreement" means the written option agreement,
substantially in the form attached hereto as Exhibit A or Exhibit B (or such
other form as may be approved by the Committee for use under the Plan pursuant
to Section 3(b)(v) hereof), between the Company and Holder evidencing the grant
of an Option.

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

         (hh)     "Optioned Stock" means the Shares of Common Stock subject to
an Option.

         (ii)     "Other Stock-Based Awards" means Awards (other than Options,
Stock Appreciation Rights, Restricted Stock, Deferred Stock and Stock Reload
Options) denominated or payable in, valued in whole or in part by reference to,
or otherwise based on or related to Shares of Common Stock.

         (jj)     "Parent" means any Person (other than the Company) in an
unbroken chain of Persons ending with the Company if, at the time an Award is
granted, each of the Persons other than the Company

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owns stock (or other equity interests) possessing 50% or more of the total
combined voting power of all classes of stock (or other equity interests) in one
or more of the other Persons in such chain.

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

         (ll)     "Person" means any individual, corporation, partnership,
limited liability company, joint venture, estate, trust, unincorporated
association, or any other entity.

         (mm)     "Plan" means this Ascendant Solutions, Inc. 2002 Equity
Incentive Plan.

         (nn)     "Restricted Stock" means Shares of Common Stock received under
an Award made pursuant to Section 9 below that is subject to restrictions under
Section 9.

         (oo)     "Rule 16b-3" means Rule 16b-3 promulgated under the Exchange
Act or any successor rule thereto.

         (pp)     "SAR Value" means, with respect to an individual Stock
Appreciation Right, the excess of the Fair Market Value of one Share over the
exercise price per share specified in a related Option in the case of a Tandem
Stock Appreciation Right, or over the Stock Appreciation Right price per share
in the case of a Stock Appreciation Right awarded on a free standing basis.

         (qq)     "Share" means a share of Common Stock.

         (rr)     "Stock Appreciation Right" means the right, pursuant to an
Award granted under Section 8 hereof, to recover an amount equal to the SAR
Value.

         (ss)     "Stock Exchange" means, at any point in time, any established
stock exchange on which the Common Stock is then listed or any national market
system, including without limitation The Nasdaq Stock Market or The Nasdaq
SmallCap Market of The Nasdaq Stock Market, on which the Common Stock is then
quoted.

         (tt)     "Stock Reload Option" means any option granted under Section
7(e) as a result of the payment of the exercise price of an Option and/or the
withholding tax related thereto in the form of Common Stock owned by the Holder
or the withholding of Common Stock by the Company.

         (uu)     "Subsidiary" means any Person (other than the Company) in any
unbroken chain of Persons beginning with the Company if, at the time of granting
of an Award, each of the Persons (other than the last Person in the unbroken
chain) owns stock (or other equity interests) possessing 50% or more of the
total combined voting power of all classes of stock (or other equity interests)
in one of the other Persons in such chain.

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

         (ww)     "Tandem Stock Appreciation Right" means a Stock Appreciation
Right granted in tandem with all or part of any Option granted under the Plan.

         (xx)     "Voting Stock" shall have the meaning set forth in the
definition of "Change of Control" above.

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         3.       ADMINISTRATION OF THE PLAN.

         (a)      Plan Administration. The Plan at all times shall be
administered by the Committee. The Committee shall act by a majority of its
members in office. The Committee may act either by vote at a meeting or by a
memorandum or other written instrument signed by a majority of the Committee.
Members of the Committee shall receive such compensation for their services as
members as may be determined by the Board. All expenses and liabilities incurred
by members of the Committee in connection with the administration of the Plan
shall be borne by the Company. The Committee may employ attorneys, consultants,
accountants, appraisers, brokers or other persons. The Committee, the Company
and its Officers and Directors shall be entitled to rely upon the advice,
opinions or valuations of any such persons.

         (b)      Powers of the Committee. Subject to the provisions of the Plan
and subject to the approval of any relevant authorities, including the approval,
if required, of the Stock Exchange, the Committee shall have the full authority
to award: (i) Options, (ii) Stock Appreciation Rights, (iii) Restricted Stock,
(iv) Deferred Stock, (v) Stock Reload Options and/or (vi) Other Stock-Based
Awards. For purposes of illustration and not of limitation, the Committee shall
have the authority (subject only to the express provisions of the Plan):

                  (i)      to determine the Fair Market Value of the Common
         Stock;

                  (ii)     to select the Consultants and Employees to whom
         Awards may from time to time be granted hereunder;

                  (iii)    to determine whether and to what extent Awards or any
         combination thereof are granted hereunder;

                  (iv)     to determine the number of Shares to be covered by
         each such Award granted hereunder;

                  (v)      to approve the forms of Agreements (including Option
         Agreements) for use under the Plan;

                  (vi)     to determine the terms and conditions, not
         inconsistent with the terms of the Plan, of any Award granted
         hereunder, which terms and conditions may include, but will not be
         limited to, the exercise price of an Option; any specified performance
         goals or other criteria which must be attained for the vesting of an
         Award; any restrictions or limitations applicable to any Awards,
         including, without limitation, any rights of first refusal, repurchase
         rights or other restrictions on transfer applicable to such Award as
         may be set forth in the Agreement evidencing such Award; and any
         vesting, exchange, surrender, cancellation, acceleration, termination,
         exercise or forfeiture provisions applicable to any Awards;

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

                  (viii)   to institute an Option Exchange Program; and

                  (ix)     to construe and interpret the terms of the Plan and
         the Awards granted pursuant to the Plan.

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         (c)      Effect of Committee's Decision. All decisions, determinations
and interpretations of the Committee shall be final and binding on all Holders
of any Awards. No member of the Board or any Committee administering the Plan
shall be liable for any action taken or determination made in good faith with
respect to the Plan or any Award granted hereunder, and all members of the Board
or any Committee administering the Plan shall be fully protected by the Company
in respect of any such action or determination.

         4.       STOCK SUBJECT TO THE PLAN.

         (a)      The maximum aggregate number of Shares that may be acquired by
Holders of Awards granted under the Plan is 2,000,000 Shares. The Shares may be
authorized but unissued Shares of Common Stock or may be reacquired Shares of
Common Stock.

         If any Shares of Common Stock that are subject to an Option granted
hereunder cease to be subject to such Option, or if any Shares of Common Stock
that are subject to any other Award granted hereunder are forfeited or any such
Award otherwise terminates without a payment being required to be made to the
Holder in the form of Common Stock, such Shares shall again be available for
distribution in connection with future grants of Options and other Awards under
the Plan. Only net Shares issued upon a stock-for-stock exercise (including
Common Stock used for withholding taxes) shall be counted against the number of
Shares available under the Plan.

         (b)      The maximum number of Shares with respect to which Options or
Stock Appreciation Rights may be granted under the Plan during any fiscal year
of the Company to any Employee or Consultant shall not exceed 1,500,000 (in each
case subject to adjustment as provided in Section 13 of the Plan).

         If an Option or Stock Appreciation Right is cancelled in the same
fiscal year of the Company in which it was granted (other than in connection
with a transaction described in Section 13 of the Plan), the cancelled Option or
Stock Appreciation Right will be counted against the limit set forth this
Section 4(b). For this purpose, if the exercise price of an Option or the base
amount on which a Stock Appreciation Right is calculated is reduced, the
transaction will be treated as a cancellation of the Option or Stock
Appreciation Right, as applicable, and the grant of a new Option or new Stock
Appreciation Right, as applicable.

         5.       ELIGIBILITY.

         (a)      Awards may be made or granted to Employees (including Officers
and Directors) and Consultants of the Company and its Affiliates who, in the
sole and unreviewable determination of the Committee, are deemed to have
rendered or to be able to render services to the Company or its Affiliates and
who are deemed to have contributed or to have the potential to contribute to the
success of the Company or its Affiliates. No Incentive Stock Option shall be
granted to any Person who is not an Employee of the Company or a Corporate
Affiliate of the Company at the time of grant.

         (b)      Each Option shall be designated in the applicable Option
Agreement as either an Incentive Stock Option or a Nonqualified 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 Holder during any calendar year (under all
plans of the Company or any Affiliate) exceeds $100,000, such Options shall be
treated for tax purposes as Nonqualified Stock Options. For purposes of this
Section 5(b), Incentive Stock Options shall be taken into account in the order
in which they were granted. For purposes of this Section 5(b), the Fair Market
Value of the Shares shall be determined as of the time the Option with respect
to such Shares is granted.

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         (c)      Neither the Plan nor any Award shall confer upon any Holder
any right with respect to continuation of his or her employment or consulting
relationship with the Company or any Affiliate, nor shall it interfere in any
way with his or her right or the Company's or an Affiliate's right to terminate
his or her employment or consulting relationship at any time, with or without
cause.

         6.       OPTION EXERCISE PRICE AND CONSIDERATION.

         (a)      The per share exercise price for the Shares to be issued upon
exercise of an Option shall be such price as is determined by the Committee;
provided that the exercise price for Options granted under the Director Fee
Investment Option Grant Program shall be determined pursuant to Section 11
hereof; and provided further that in the case of an Incentive Stock Option
(which in all cases shall be subject to the Code):

                  (i)      granted to an Employee who, at the time of grant of
         such Option, owns stock representing more than ten percent (10%) of the
         voting power of all classes of stock of the Company or any Corporate
         Affiliate, the per share exercise price shall not be less than 110% of
         the Fair Market Value per Share on the date of grant; and

                  (ii)     granted to any other Employee, the per share exercise
         price shall not be less than 100% of the Fair Market Value per Share on
         the date of grant.

         (b)      The type of consideration to be paid for the Shares to be
issued upon exercise of an Option, including the method of payment, shall be
determined by the Committee (and, in the case of an Incentive Stock Option,
shall be determined at the time of grant and shall be subject to the Code). Such
consideration shall be paid, to the extent permitted by Applicable Laws at the
time the Option is exercised, either (i) in cash or check, or (ii) at the
discretion of the Committee, in one or a combination of the following ways
(which may be in combination with or in lieu of payment by cash or check): (A)
by delivery to the Company of other Shares of Common Stock of the Company that
(x) in the case of Shares acquired upon exercise of an Option, have been owned
by the Holder for more than six months on the date of surrender or such other
period as may be required to avoid a charge to the Company's earnings for
financial reporting purposes, and (y) have a Fair Market Value on the exercise
date equal to the aggregate exercise price of the Shares as to which said Option
shall be exercised, (B) according to a deferred payment or other arrangement
with the Person to whom the Option is granted or to whom the Option is
transferred pursuant to Section 16, (C) a reduction in the amount of any Company
liability to the Holder, including any liability attributable to the Holder's
participation in any Company-sponsored deferred compensation program or
arrangement, (D) when permitted by Applicable Laws, through a "same day sale"
commitment from the Holder (and if applicable a broker-dealer that is a member
of the National Association of Securities Dealers (a "NASD Dealer")), whereby
the Holder irrevocably elects to exercise the Option and to sell at least that
number of Shares so purchased to pay the aggregate exercise price of all of the
Shares so purchased, and the Holder (or, if applicable, the NASD Dealer) commits
upon sale (or, in the case of the NASD Dealer, upon receipt) of such Shares to
forward an amount equal to the aggregate exercise price of such Shares directly
to the Company, with any sale proceeds in excess of such amount being for the
benefit of the Holder, or (E) in any other form of legal consideration that may
be acceptable to the Committee. In making its determination as to the type of
consideration to accept, the Committee may consider if acceptance of such
consideration may be reasonably expected to benefit the Company. In addition,
such consideration shall be accompanied by the delivery by the Holder of a
properly executed exercise notice together with such other documentation as the
Committee and a broker, if applicable, shall require to effect an exercise of
the Option and delivery to the Company of the sale or loan proceeds required to
pay the exercise price.

         7.       EXERCISE OF OPTION.

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         (a)      Procedure for Exercise; Rights as a Shareholder. Any Option
granted hereunder shall be exercisable at such times and under such conditions
as determined by the Committee, including performance criteria with respect to
the Company and/or the Holder, and as shall be permissible under the terms of
the Plan. At the discretion of the Committee, the Option Agreement may, but need
not, include a provision whereby the Holder may elect at any time before the
Holder's Continuous Status as an Employee or Consultant terminates to exercise
the Option as to any part or all of the Shares subject to the Option prior to
the full vesting of the Option. Any unvested Shares so purchased shall (unless
otherwise set forth in the Option Agreement evidencing such Options) be subject
to (i) terms and conditions similar to those applicable to Restricted Stock
under Section 9(b) hereof, (ii) a repurchase option in favor of the Company, and
(iii) any other restrictions the Committee determines to be appropriate.

         The total number of Shares subject to an Option may, but need not, be
allotted in periodic installments (which may, but need not, be equal). The
Option Agreement may provide that from time to time during each of such
installment periods, the Option may become exercisable with respect to some or
all of the Shares allotted to that period and may be exercised with respect to
some or all of the Shares allotted to such period and/or any prior period as to
which the Option became vested but was not fully exercised.

         An Option may not be exercised for a fraction of a Share. Exercise of
an Option in any manner shall result in a decrease in the number of Shares that
thereafter may be 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.

         Subject to Section 19, an Option shall be deemed to be exercised when
written notice of such exercise has been given to the Company in accordance with
the terms of the Option Agreement by the Person entitled to exercise the Option
and full payment for the Shares with respect to which the Option is exercised
has been received by the Company. Until the issuance (as evidenced by the
appropriate entry on the books of the Company or of a duly authorized transfer
agent of the Company) of the stock certificate evidencing such Shares, no right
to vote, 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 stock certificate promptly upon
exercise of the Option. No adjustment shall be made for a dividend or other
right for which the record date is prior to the date the stock certificate is
issued, except as provided in Section 13 hereof.

         (b)      Termination of Employment or Consulting Relationship. Subject
to Section 7(c) and Section 7(d) below and the applicable Option Agreement, in
the event of termination of a Holder's Continuous Status as an Employee or
Consultant, such Holder may exercise his or her Option to the extent that the
Holder was entitled to exercise it at the date of such termination; provided,
however, that such Option may be exercised only within such period of time as is
determined by the Committee at the date of grant. Such time period shall not, in
the case of an Incentive Stock Option, exceed three (3) months after the date of
such termination and shall not, in any case, be later than the expiration date
of the term of such Option as set forth in the Option Agreement. To the extent
that the Holder was not entitled to exercise the Option at the date of such
termination, or if the Holder does not exercise such Option to the extent so
entitled within the time specified herein, the Option shall terminate and the
Shares covered by such Option shall revert to the Plan. A Holder's Continuous
Status as an Employee or Consultant shall not be terminated in the event of
Holder's change of status from an Employee to a Consultant or from a Consultant
to an Employee; provided, however, that in the event of a Holder's change of
status from an Employee to a Consultant, any Incentive Stock Option granted to
such Employee shall automatically cease to be treated for tax purposes as an
Incentive Stock Option and shall be treated for tax purposes as a Nonqualified
Stock Option on the day that is three months and one day following such change
of status.

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         Further, the Committee may provide in the Option Agreement evidencing a
grant of Options that upon termination of a Holder's Continuous Status as an
Employee or Consultant, the Committee may elect in its sole discretion that the
portion of any Option unexercised as of the date of termination shall be
exercisable for Shares of Common Stock or, in lieu thereof, for an amount in
cash equal to the excess of the Fair Market Value of the Common Stock over the
exercise price, times the number of Shares of Common Stock for which the Option
is being exercised. Such exercise shall be effected in the manner set forth in
Section 6(b) hereof, except that in the event that the Committee elects pursuant
to this Section 7(b) to deliver cash instead of Shares of Common Stock, the
Holder shall not be required to pay the exercise price to the Company. In the
event that the Committee elects pursuant to this Section 7(b) to deliver cash
instead of Shares of Common Stock and, on the date of such exercise, the Fair
Market Value of the Common Stock is less than or equal to the applicable
exercise price, then the Holder shall not be entitled to any cash, stock or
other property upon such exercise, and the Holder shall have no further rights
with respect to the portion of the Option so exercised.

         (c)      Disability of Holder. In the event of termination of a
Holder's Continuous Status as an Employee or Consultant as a result of his or
her Disability, the Holder may, but only within twelve (12) months from the date
of such termination (and in no event later than the expiration date of the term
of such Option as set forth in the Option Agreement), exercise the Option to the
extent he or she otherwise was entitled to exercise it at the date of such
termination. If such Disability is not a "disability" as such term is defined in
Section 22(e)(3) of the Code, then in the case of an Incentive Stock Option such
Incentive Stock Option shall automatically cease to be treated for tax purposes
as an Incentive Stock Option and shall be treated for tax purposes as a
Nonqualified Stock Option on the day that is three months and one day following
such termination. To the extent that the Holder was not entitled to exercise the
Option at the date of termination, or if the Holder does not exercise such
Option to the extent so entitled within the time specified herein, the Option
shall terminate and the Shares covered by such Option shall revert to the Plan.

         (d)      Death of Holder. In the event of the death of a Holder, the
Option may be exercised at any time within twelve (12) months following the date
of death (but in no event later than the expiration date of the term of such
Option as set forth in the Option Agreement) by the Holder's estate or by any
Person who acquired the right to exercise the Option by bequest or inheritance
(the "Option Beneficiary"), but only to the extent that the Holder was entitled
to exercise the Option on the date of death. To the extent that, at the time of
death, the Holder was not entitled to exercise the Option, or if the Option
Beneficiary does not exercise the Option within the time specified herein, the
Option shall terminate and the Shares covered by such Option shall revert to the
Plan.

         (e)      Stock Reload Option. The Committee may also grant to the
Holder (concurrently with the grant of an Incentive Stock Option and at or after
the time of grant in the case of a Nonqualified Stock Option) a Stock Reload
Option exercisable for a number of shares up to (but not exceeding) the amount
of Shares of Common Stock (i) held by the Holder for at least six months and
(ii) used to pay all or part of the exercise price of an Option or withheld by
the Company as payment for withholding taxes. Such Stock Reload Option shall
have an exercise price of the Fair Market Value as of the date of the Stock
Reload Option grant. Unless the Committee determines otherwise, (i) a Stock
Reload Option may be exercised commencing one year after it is granted and shall
expire on the date of expiration of the Option to which the Stock Reload Option
is related and (ii) shall otherwise be treated as an Option for all purposes
under the Plan.

         (f)      Tax Withholding.
                  ---------------

                  (i)      As a condition of the exercise of an Option granted
         under the Plan, the Holder (or in the case of the Holder's death, the
         Option Beneficiary) shall make such arrangements as the

                                       10

<PAGE>

         Committee may require for the satisfaction of any applicable federal,
         state, local or foreign withholding tax obligations that may arise in
         connection with the exercise of an Option and the issuance of Shares.
         The Company shall not be required to issue any Shares under the Plan
         until such obligations are satisfied.

                  (ii)     In the case of an Employee and in the absence of any
         other arrangement, the Employee shall be deemed to have directed the
         Company to withhold or collect from his or her compensation an amount
         sufficient to satisfy such tax obligations from the next payroll
         payment otherwise payable after the date of an exercise of the Option.

                  (iii)    If permitted by the Committee, in its discretion, in
         the case of a Holder other than an Employee (or in the case of an
         Employee where the next payroll payment is not sufficient to satisfy
         such tax obligations, with respect to any remaining tax obligations),
         in the absence of any other arrangement and to the extent permitted
         under Applicable Laws, the Holder shall be deemed to have elected to
         have the Company withhold from the Shares to be issued upon exercise of
         the Option that number of Shares having a Fair Market Value determined
         as of the applicable Tax Date (as defined below) equal to the minimum
         statutory withholding rates for federal and state tax purposes,
         including payroll taxes, applicable to the exercise. For purposes of
         this Section 7(f)(iii), 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 under the Applicable Laws (the "Tax
         Date").

                  (iv)     If permitted by the Committee, in its discretion, a
         Holder may satisfy his or her tax withholding obligations upon exercise
         of an Option by any method of payment and form of consideration
         allowable under Section 6(b) hereof.

                  (v)      Any election or deemed election by a Holder to have
         Shares withheld to satisfy tax withholding obligations under Section
         7(f)(iii) or (iv) above shall be irrevocable as to the particular
         Shares as to which the election is made and shall be subject to the
         consent or disapproval of the Committee. Any election by a Participant
         under Section 7(f)(iv) above must be made on or prior to the applicable
         Tax Date.

         8.       STOCK APPRECIATION RIGHTS.

         (a)      Grant and Exercise. Stock Appreciation Rights may be granted
in tandem with (i.e., Tandem Stock Appreciation Right) or in conjunction with
all or part of any Option granted under the Plan or may be granted on a
free-standing basis. In the case of a Nonqualified Stock Option, a Tandem Stock
Appreciation Right may be granted either at or after the time of the grant of
such Nonqualified Stock Option. In the case of an Incentive Stock Option, a
Tandem Stock Appreciation Right may be granted only at the time of the grant of
such Incentive Stock Option, and will be subject to the Code.

         (b)      Terms and Conditions. Stock Appreciation Rights shall be
subject to the following terms and conditions:

                  (i)      Exercise. Tandem Stock Appreciation Rights shall be
         exercisable only at such time or times and to the extent that the
         Options to which they relate shall be exercisable in accordance with
         the provisions of Section 7 hereof and this Section 8 and shall be
         subject to the Code with respect to related Incentive Stock Options and
         such additional limitations on exercise as shall be determined by the
         Committee and set forth in the Agreement. A Tandem Stock Appreciation
         Right may be exercised only when the Fair Market Value of the Shares
         underlying

                                       11

<PAGE>

         the Option to which it relates exceeds the Option's exercise price.
         Other Stock Appreciation Rights shall be exercisable at such time or
         times and subject to such terms and conditions as shall be determined
         by the Committee and set forth in the Agreement.

                  (ii)     Termination. A Tandem Stock Appreciation Right shall
         terminate and shall no longer be exercisable upon the termination or
         exercise of the related Option, except that, unless otherwise
         determined by the Committee at the time of grant, a Tandem Stock
         Appreciation Right granted with respect to less than the full number of
         Shares covered by a related Option shall not be reduced until after the
         number of Shares remaining under the related Option equals the number
         of Shares covered by the Tandem Stock Appreciation Right. Other Stock
         Appreciation Rights shall terminate and shall no longer be exercisable
         upon such terms and conditions as shall be determined by the Committee
         and as set forth in the Agreement.

                  (iii)    Method of Exercise. A Tandem Stock Appreciation Right
         may be exercised by a Holder by surrendering the applicable portion of
         the related Option. Other Stock Appreciation Rights may be exercised by
         a Holder upon surrender thereof, or upon such terms and conditions as
         shall be determined by the Committee and as set forth in the Agreement.
         Upon such exercise and surrender, the Holder shall be entitled to
         receive such amount in the form determined pursuant to Section 8(b)(iv)
         below. Options which have been so surrendered, in whole or in part,
         shall no longer be exercisable to the extent the related Tandem Stock
         Appreciation Rights have been exercised.

                  (iv)     Receipt of SAR Value. Upon the exercise of each
         individual Stock Appreciation Right covered by an Award of Stock
         Appreciation Rights, a Holder shall be entitled to receive up to, but
         not more than, an amount in cash and/or Shares of Common Stock equal to
         the SAR Value for such individual Stock Appreciation Right, with the
         Committee having the right to determine the form of payment.

                  (v)      Shares Affected Upon Plan. Upon the exercise of a
         Tandem Stock Appreciation Right, the Option or part thereof to which
         such Tandem Stock Appreciation Right is related shall be deemed to have
         been exercised for the purpose of the limitation set forth in Section 4
         hereof on the number of Shares of Common Stock to be issued under the
         Plan, but only to the extent of the number of Shares, if any, issued
         under the Tandem Stock Appreciation Right at the time of exercise based
         upon the SAR Value.

         9.       RESTRICTED STOCK.

         (a)      Grant. Shares of Restricted Stock may be awarded either alone
or in addition to other Awards granted under the Plan. The Committee shall
determine the Employees and/or Consultants to whom, and the time or times at
which, grants of Restricted Stock will be awarded, the number of Shares to be
awarded, the price (if any) to be paid by the Holder, the time or times within
which such Awards may be subject to forfeiture ("Restriction Period"), the
vesting schedule and rights to acceleration thereof, and all other terms and
conditions of the Awards.

         (b)      Terms and Conditions. Each Award of Restricted Stock shall be
subject to the following terms and conditions:

                  (i)      Certificates. Restricted Stock, when issued, will be
         represented by a stock certificate or certificates registered in the
         name of the Holder to whom such Restricted Stock shall have been
         awarded. During the Restriction Period, certificates representing the
         Restricted Stock and any securities constituting Retained Distributions
         (as defined below) shall bear a legend to

                                       12

<PAGE>

         the effect that ownership of the Restricted Stock (and such Retained
         Distributions), and the enjoyment of all rights appurtenant thereto,
         are subject to the restrictions, terms and conditions provided in the
         Plan and the Agreement. Such certificates shall be deposited by the
         Holder with the Company, together with stock powers or other
         instruments of assignment, each endorsed in blank, which will permit
         transfer to the Company of all or any portion of the Restricted Stock
         and any securities constituting Retained Distributions that shall be
         forfeited or that shall not become vested in accordance with the Plan
         and the Agreement.

                  (ii)     Rights of Holder. Restricted Stock shall constitute
         issued and outstanding Shares of Common Stock for all corporate
         purposes. The Holder will have the right to vote such Restricted Stock,
         to receive and retain all regular cash dividends and other cash
         equivalent distributions as the Board may in its sole discretion
         designate, pay or distribute on such Restricted Stock and to exercise
         all other rights, powers and privileges of a holder of Common Stock
         with respect to such Restricted Stock, with the exceptions that (A) the
         Holder will not be entitled to delivery of the stock certificate or
         certificates representing such Restricted Stock until the Restriction
         Period shall have expired and unless all other vesting requirements
         with respect thereto shall have been fulfilled; (B) the Company will
         retain custody of the stock certificate or certificates representing
         the Restricted Stock during the Restriction Period; (C) other than
         regular cash dividends and other cash equivalent distributions as the
         Board may in its sole discretion designate, pay or distribute, the
         Company will retain custody of all distributions ("Retained
         Distributions") made or declared with respect to the Restricted Stock
         (and such Retained Distributions will be subject to the same
         restrictions, terms and conditions as are applicable to the Restricted
         Stock) until such time, if ever, as the Restricted Stock with respect
         to which such Retained Distributions shall have been made, paid or
         declared shall have become vested and with respect to which the
         Restriction Period shall have expired; and (D) a breach of any of the
         restrictions, terms or conditions contained in this Plan or the
         Agreement or otherwise established by the Committee with respect to any
         Restricted Stock or Retained Distributions will cause a forfeiture of
         such Restricted Stock and any Retained Distributions with respect
         thereto.

                  (iii)    Vesting: Forfeiture. Upon the expiration of the
         Restriction Period with respect to each Award of Restricted Stock and
         the satisfaction of any other applicable restrictions, terms and
         conditions (A) all such Restricted Stock shall become vested in
         accordance with the terms of the Agreement, and (B) any Retained
         Distributions with respect to such Restricted Stock shall become vested
         to the extent that the Restricted Stock related thereto shall have
         become vested. Any such Restricted Stock and Retained Distributions
         that do not vest shall be forfeited to the Company and the Holder shall
         not thereafter have any rights with respect to such Restricted Stock
         and Retained Distributions that shall have been so forfeited.

         10.      DEFERRED STOCK.

         (a)      Grant. Shares of Deferred Stock may be awarded either alone or
in addition to other Awards granted under the Plan. The Committee shall
determine the Employees and/or Consultants to whom, and the time or times at
which, grants of Deferred Stock shall be awarded, the number of shares of
Deferred Stock to be awarded, the duration of the period ("Deferral Period")
during which, and the conditions under which, receipt of the Shares will be
deferred, and all the other terms and conditions of the Awards.

         (b)      Terms and Conditions. Each Award of Deferred Stock shall be
subject to the following terms and conditions:

                                       13

<PAGE>

                  (i)      Certificates. At the expiration of the Deferral
         Period (or the Additional Deferral Period referred to in Section
         10(b)(iii) below, where applicable), share certificates shall be
         delivered to the Holder, or his legal representative, representing the
         number of Shares equal to the Shares covered by the Award of Deferred
         Stock.

                  (ii)     Vesting; Forfeiture. Upon the expiration of the
         Deferral Period (or the Additional Deferral Period, where applicable)
         with respect to each Award of Deferred Stock and the satisfaction of
         any other applicable limitations, terms or conditions, such Deferred
         Stock shall become vested in accordance with the terms of the
         Agreement. Any Deferred Stock that does not vest shall be forfeited to
         the Company and the Holder shall not thereafter have any rights with
         respect to such Deferred Stock that has been so forfeited. Prior to the
         expiration of the Deferral Period (or the Additional Deferral Period,
         where applicable), such Deferred Stock shall not be treated as issued
         and outstanding Shares of the Company.

                  (iii)    Additional Deferral Period. A Holder may request to,
         and the Committee may at any time, defer the receipt of an Award (or an
         installment of an Award) for an additional specified period or until
         the occurrence of a specified event ("Additional Deferral Period").
         Subject to any exceptions adopted by the Committee, such request must
         be made at least one year prior to expiration of the Deferral Period
         for such Award of Deferred Stock (or such installment).

         11.      DIRECTOR FEE INVESTMENT OPTION GRANT PROGRAM.

         (a)      Grant. A Director Fee Investment Option Grant Program may be
(but is not required to be) implemented by the Board as of the first day of any
calendar year beginning after the IPO Date. Upon such implementation, each
Non-Employee Director who at such time receives an annual retainer fee payable
in cash for his or her service on the Board may elect to apply all or any
portion of such annual retainer fee to the acquisition of an Option grant under
this Director Fee Investment Option Grant Program. Such election must be filed
with the Company's Chief Financial Officer prior to the first day of the
calendar year for which the election is to be in effect. Each Non-Employee
Director who files such a timely election with respect to his or her annual
retainer fee shall automatically be granted an Option under this Director Fee
Investment Option Grant Program on the first trading day in January in the
calendar year for which that fee would otherwise be payable.

         (b)      Terms and Conditions. Each Option shall be a Nonqualified
Stock Option governed by the terms and conditions specified below:

                  (i)      Exercise Price. The exercise price per Share shall be
         thirty-three and one-third percent (33-1/3%) of the Fair Market Value
         per Share on the Option grant date. The exercise price shall become
         immediately due upon exercise of the Option and shall be payable in one
         or more of the alternative forms authorized under Section 6(b) hereof.

                  (ii)     Number of Option Shares. The number of Shares subject
         to the Option shall be determined pursuant to the following formula
         (rounded down to the nearest whole number):

                           X = A / (B x 66-2/3%), where

                           X is the number of Option shares,

                           A is the dollar amount of the annual retainer fee
                           subject to the Non-Employee Director's election, and

                                       14

<PAGE>

                           B is the Fair Market Value per Share on the Option
                           grant date.

                  (iii)    Exercise. If granted, the Option shall become
         exercisable in a series of twelve (12) successive equal monthly
         installments upon the Holder's completion of each month of Board
         service during the calendar year in which the Option is granted. Each
         Option shall have a maximum term of ten (10) years measured from the
         Option grant date.

                  (iv)     Remaining Terms. Each Option granted under this
         Director Fee Investment Option Grant Program shall be subject to (x)
         the terms and conditions of Section 7 hereof to the extent such terms
         and conditions are not inconsistent with this Section 11(b) and (y)
         such other terms and conditions as may be determined by the Board and
         set forth in the Option Agreement evidencing such Options.

         12.      OTHER STOCK-BASED AWARDS.

         (a)      Grant and Exercise. Other Stock-Based Awards may be awarded,
subject to limitations under Applicable Laws, that are denominated or payable
in, valued in whole or in part by reference to, or otherwise based on or related
to Shares of Common Stock, as deemed by the Committee to be consistent with the
purposes of the Plan, including, without limitation, purchase rights, Shares of
Common Stock awarded which are not subject to any restrictions or conditions,
convertible or exchangeable debentures, or other rights convertible into or
exchangeable for Shares of Common Stock and Awards valued by reference to the
value of securities of or the performance of specified Subsidiaries or the
Parent of the Company. Other Stock-Based Awards may be awarded either alone or
in addition to or in tandem with any other Awards under this Plan or any other
plan of the Company or any Affiliate.

         (b)      Eligibility For Other Stock-Based Awards. The Committee shall
determine the Employees and/or Consultants to whom, and the time or times at
which, grants of such Other Stock-Based Awards shall be made, the number of
Shares of Common Stock to be awarded pursuant to such Awards, and all other
terms and conditions of the Awards.

         (c)      Terms and Conditions. Each Other Stock-Based Award shall be
subject to such terms and conditions as may be determined by the Committee and
set forth in the Agreement evidencing such Award.

                                       15

<PAGE>

         13.      ADJUSTMENTS UPON CHANGES IN CAPITALIZATION OR MERGER.

         (a)      Changes in Capitalization. Subject to any required action by
the shareholders of the Company, (i) the number of Shares of Common Stock
covered by each outstanding Award, (ii) the number of Shares of Common Stock
which have been authorized for issuance under the Plan but as to which no Awards
have yet been granted or which have been returned to the Plan upon cancellation
or expiration of an Award, and (iii) the price per share of Common Stock covered
by each such outstanding Award, 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
consideration by the Company. The 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 Committee, whose
determination in that respect shall be final, binding and conclusive. Except as
expressly provided herein, no issuance by the Company of shares of capital stock
of any class, or securities convertible into or exchangeable for shares of
capital stock of any class, shall affect, and no adjustment by reason thereof
shall be made with respect to, the number or exercise price of Shares of Common
Stock subject to an Award.

         (b)      Dissolution or Liquidation. In the event of the proposed
dissolution or liquidation of the Company, the Committee shall notify each
Holder of an outstanding Award granted hereunder at least fifteen (15) days
prior to such proposed action. To the extent it has not been previously
exercised, the Award shall terminate immediately prior to the consummation of
such proposed action; provided, however, that the Committee may, in the exercise
of its sole and unreviewable discretion in such instances, declare that any
Award shall terminate as of an earlier date fixed by the Committee and give each
Holder the right to exercise his or her rights as to all or any part of the
Award, including Shares as to which the Award would not otherwise be
exercisable.

         (c)      Merger or Asset Sale. Subject to Section 13(d), in the event
of the merger of the Company into, or the consolidation of the Company with,
another Person in which the shareholders of the Company receive cash or
securities of another issuer, or any combination thereof, in exchange for their
Shares of Common Stock, or the sale of all or substantially all of the assets of
the Company, each outstanding Award shall be assumed or an equivalent option or
right substituted by the successor Person or an Affiliate of the successor
Person. In the event that the successor Person refuses to assume or substitute
for the Award, the Holder shall fully vest in and have the right to exercise the
Award (provided it has not already terminated), including Shares as to which it
would not otherwise be vested or exercisable. If an Award becomes fully vested
and exercisable in lieu of assumption or substitution in the event of a merger,
consolidation or sale of assets, the Committee shall notify the Holder that the
Award shall be fully exercisable for a period of fifteen (15) days from the date
of such notice, and the Award shall terminate upon the expiration of such
period. For the purposes of this Section 13(c), the Award shall be considered
assumed if, following the merger, consolidation or sale of assets, the option or
right substituted for such Award confers the right to purchase or receive, for
each Share of Common Stock subject to the Award immediately prior to the merger,
consolidation or sale of assets, the per share consideration (whether stock,
cash, or other securities or property) received in the merger, consolidation or
sale of assets by holders of Common Stock (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, consolidation or sale of assets is not solely common
stock of the successor Person or its Parent (if any), the Committee may, with
the consent of the successor Person, provide for the consideration to be
received upon the exercise of the Award, for each Share of Common Stock subject
to the Award, to be solely common stock of the successor Person or its Parent
(if any) equal in fair market value to the per share consideration received by
holders of Common Stock in the merger, consolidation or sale of assets.

                                       16

<PAGE>

         (d)      Change of Control. Notwithstanding anything to the contrary,
the Committee may grant Awards which provide for the acceleration of the vesting
of Shares subject to the Award upon a Change of Control. Such provisions shall
be set forth in the Agreement evidencing such Award.

         (e)      Further Adjustments. In the event of any change of a type
described in Section 13(a) or Section 13(c) above, the Committee shall make any
further adjustment to the maximum number of Shares which may be acquired under
the Plan pursuant to the exercise of Awards, the maximum number of Shares for
which Awards may be granted to any one Employee or Consultant and the number of
Shares and price per Share subject to outstanding Awards as shall be equitable
to prevent dilution or enlargement of rights under such Awards, and the
determination of the Committee as to these matters shall be conclusive and
binding on the Holder; provided, however, that (i) each such adjustment with
respect to an Incentive Stock Option shall comply with the rules of Section
424(a) of the Code (or any successor provision) and (ii) in no event shall any
adjustment be made which would cause any Incentive Stock Option granted
hereunder to no longer be an "incentive stock option" as defined in Section 422
of the Code.

         (f)      No Limitation on Right to Merge, Etc. The grant of Awards
pursuant to the Plan shall not restrict in any way the right or power of the
Company to make adjustments, reclassifications, reorganizations or changes of
its capital or business structure or to merge, consolidate, dissolve, liquidate,
or sell or transfer all or any part of its business or assets.

         14.      TERM OF PLAN.

         The Plan shall become effective upon the earlier to occur of its
adoption by the Board or its approval by the shareholders of the Company, as
described in Section 22 of the Plan. It shall continue in effect for a term of
ten (10) years unless sooner terminated under Section 18 of the Plan.

         15.      TERM OF OPTIONS.

         The term of each Option and other Award shall be the term stated in the
applicable Agreement; provided, however, that the term shall be no more than ten
(10) years from the date of grant thereof; and provided further that in the case
of an Incentive Stock Option granted to a Holder who, at the time the Option is
granted, owns stock representing more than ten percent (10%) of the voting power
of all classes of stock of the Company or any Corporate Affiliate, the term of
the Option shall be no more than five (5) years from the date of grant thereof.

         16.      NON-TRANSFERABILITY OF AWARDS.

         An Incentive Stock Option shall not be transferable except by will or
by the laws of descent and distribution and shall be exercisable during the
lifetime of the Holder to whom the Incentive Stock Option is granted only by
such Holder. Any other Award, including a Nonqualified Stock Option, shall not
be transferable except by will or by the laws of descent and distribution or
pursuant to a qualified domestic relations order, as defined by the Code or by
Title I of the Employee Retirement Income Security Act of 1974, as amended, or
the rules thereunder (a "QDRO"), and shall be exercisable during the lifetime of
the Holder to whom the Option is granted only by such Holder or any transferee
pursuant to a QDRO; provided, however, that the Committee, in its discretion,
may allow for transferability of Nonqualified Stock Options by a Holder to
Immediate Family Members. Any Nonqualified Stock Option grants that are
transferable are further conditioned on the Holder and the applicable Immediate
Family Members agreeing to abide by the Company's then current stock option
transfer guidelines. A Tandem Stock Appreciation Right may not be transferred
except when the corresponding Option is transferred as permitted by this Section
16 and, when the corresponding Option is transferred, the Tandem Stock Option

                                       17

<PAGE>

Appreciation Right must be transferred to the same permitted transferee to whom
the Option is transferred.

         17.      TIME OF GRANTING AWARDS.

         The date of grant of an Award shall, for all purposes, be the date on
which the Committee makes the determination granting such Award, or such other
date as is determined by the Committee. Notice of the determination shall be
given to each Employee or Consultant to whom an Award is so granted within a
reasonable time after the date of such grant.

         18.      AMENDMENT AND TERMINATION OF THE PLAN.

         The Board may amend or terminate the Plan in any respect whatsoever,
provided that any such amendment or termination of the Plan shall not affect
Award already granted and such Award shall remain in full force and effect as if
the Plan had not been amended or terminated. In addition, to the extent
necessary and desirable to comply with Rule 16b-3 (or any other Applicable Law
or regulation, including the requirements of the National Association of
Securities Dealers or the Stock Exchange), the Company shall obtain shareholder
approval of any Plan amendment in such a manner and to such a degree as
required.

         19.      CONDITIONS UPON ISSUANCE OF SHARES.

         Shares shall not be issued pursuant to an Award unless the issuance and
delivery of such Shares pursuant thereto shall comply with all relevant
Applicable Laws, including, without limitation, the Securities Act of 1933, as
amended (the "Securities Act"), the Exchange Act, the rules and regulations
promulgated thereunder, and the requirements of the Stock Exchange, and shall be
further subject to the approval of counsel for the Company with respect to such
compliance.

         The Company may require any Holder, as a condition of receiving Shares
pursuant to an Award, (i) to give written assurances satisfactory to the Company
as to the Holder's knowledge and experience in financial and business matters
and/or to employ a purchaser representative reasonably satisfactory to the
Company who is knowledgeable and experienced in financial and business matters,
and that he or she is capable of evaluating, alone or together with the
purchaser representative, the merits and risks of exercising the Award; (ii) to
give written assurances satisfactory to the Company stating that such Holder is
acquiring the Shares subject to the Award for such Holder's own account and not
with any present intention of selling or otherwise distributing such Shares;
(iii) to deliver such other documentation as may be necessary to comply with
federal and state securities laws and all other Applicable Laws; and (iv) to
sign a counterpart to and agree to be bound by all of the terms and conditions
of the Company's shareholders' agreement as then in effect. These requirements,
and any assurances given pursuant to such requirements, shall be inoperative if
(i) the issuance of the Shares upon the exercise of or pursuant to the Award has
been registered under a then currently effective registration statement under
the Securities Act and all applicable state securities laws, or (ii) as to any
particular requirement, a determination is made by counsel for the Company that
such requirement need not be met in the circumstances under the then applicable
securities laws and other Applicable Laws. The Company may, upon advice of
counsel to the Company, place legends on stock certificates issued under the
Plan as such counsel deems necessary or appropriate in order to comply with the
Plan, applicable securities laws and other Applicable Laws, including, but not
limited to, legends restricting the transfer of the Shares, and may enter
stop-transfer orders against the transfer of the Shares issued upon the exercise
of or pursuant to an Award.

         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

                                       18

<PAGE>

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.

         20.      RESERVATION OF SHARES.

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

         21.      AGREEMENTS.

         Options shall be evidenced by Option Agreements, and other Awards shall
be evidenced by other Agreements, each in such form as the Committee shall
approve from time to time.

         22.      SHAREHOLDER APPROVAL.

         Continuance of the Plan shall be subject to approval by the
shareholders of the Company within twelve (12) months before or after the date
the Plan is adopted by the Board. Such shareholder approval shall be obtained to
the extent and in manner required under Applicable Laws and the rules of the
Stock Exchange.

         23.      USE OF PROCEEDS FROM STOCK.

         The proceeds, if any, from the sale of Common Stock pursuant to Options
or other Awards shall constitute general funds of the Company.

         24.      MISCELLANEOUS.

         (a)      Acceleration of Vesting. The Committee shall have the power to
accelerate the time at which an Award may first be exercised or the time during
which an Award or any part thereof will vest, notwithstanding the provisions in
the Agreement evidencing the Award stating the time at which it may first be
exercised or the time during which it will vest.

         (b)      Rule 16b-3. With respect to Persons subject to Section 16 of
the Exchange Act, transactions under the Plan are intended to comply with all
applicable conditions of Rule 16b-3 and with respect to such Persons all
transactions shall be subject to such conditions regardless of whether they are
expressly set forth in the Plan or the Agreement. To the extent any provision of
the Plan or action by the Committee fails to so comply, it shall not apply to
such Persons or their transactions and shall be deemed null and void, to the
extent permitted by law and deemed advisable by the Committee.

         (c)      Grants Exceeding Allotted Shares. If the number of Shares of
Common Stock subject to an Award granted pursuant to the Plan exceeds, as of the
date of grant, the number of Shares that may be issued under the Plan without
additional shareholder approval, such Award shall be void with respect to such
excess Shares, unless shareholder approval of an amendment sufficiently
increasing the number of Shares subject to the Plan is timely obtained in
accordance with Section 18 of the Plan.

         (d)      Notice. Any written notice to the Company required by any of
the provisions of the Plan shall be addressed to the Secretary of the Company at
15455 North Dallas Parkway, Suite 500, Addison, Texas 75001, Attn: Secretary and
shall become effective when it is received. Any written notice to Holders
required by any provisions of the Plan shall be addressed to the Holder at the
address on file with the Company and shall become effective three days after it
is mailed by certified mail, postage prepaid to such address or at the time of
delivery if delivered sooner by messenger or overnight courier.

                                       19

<PAGE>

         (e)      Savings Clause. Notwithstanding any other provision hereof,
the Plan is intended to qualify as a plan pursuant to which Incentive Stock
Options may be issued under Section 422 of the Code. If the Plan or any
provision of the Plan shall be held to be invalid or to fail to meet the
requirements of Section 422 of the Code or the regulations promulgated
thereunder, such invalidity or failure shall not affect the remaining parts of
the Plan or such provisions which apply only to Nonqualified Stock Options, but
rather it shall be construed and enforced as if the Plan or the affected
provision thereof, as the case may be, complied in all respects with the
requirements of Section 422 of the Code.

         (f)      Governing Law. The Plan and all rights and obligations
thereunder shall be construed in accordance with and governed by the laws of the
State of Texas without regard to its conflict of laws rules.


             [THE REMAINDER OF THIS PAGE LEFT INTENTIONALLY BLANK.]



                                       20

<PAGE>

                                         Exhibit A to 2002 Equity Incentive Plan
                                         ---------------------------------------




                            ASCENDANT SOLUTIONS, INC.

                           2002 EQUITY INCENTIVE PLAN

                             STOCK OPTION AGREEMENT

                               (Standard Exercise)



[Optionee's name and address]

         This Stock Option Agreement (this "Option Agreement") is entered into
as of ______ __________, 2002, by and between you ("Optionee") and Ascendant
Solutions, Inc., (the "Company"). Unless otherwise defined herein, all defined
terms used herein shall have the meanings set forth in the 2002 Equity Incentive
Plan of the Company (the "Plan").

         1.       Grant of Option. The Company hereby grants to Optionee an
option (the "Option") to purchase the number of shares (the "Shares") of the
Common Stock, par value $.0001 per share (the "Common Stock"), of the Company
set forth below at the exercise price and on the other terms and conditions set
forth below, subject to the terms and conditions of this Option Agreement and
the Plan (which is incorporated herein by reference), including the provisions
thereof relating to increases in the number of shares covered by this Option
upon the occurrence of certain specified events, as follows:

         Grant Number                             ______________________________
         Date of Grant ("Date of Grant")          ______________________________
         Vesting Commencement Date                ______________________________
         Exercise Price per Share ("Exercise      ______________________________
         Price Per Share")
         Total Number of Shares Granted           ______________________________
         Total Exercise Price                     ______________________________
         Type of Option:
                  ____ Incentive Stock Option
                  ____ Nonqualified Stock Option
         Term/Expiration Date: _________________
         (No more than 10 years from date
         of grant, 5 years for certain grants)


         If designated above as an Incentive Stock Option, this Option is
intended (subject to Section 5(b) of the Plan) to qualify as an Incentive Stock
Option as defined in Section 422 of the Code; provided, however, the Company has
not made, and will not be deemed to make hereby, any representations or
warranties to Optionee with respect to such qualification.

                                       21

<PAGE>

         2.       Vesting Schedule.
                  ----------------

                  (a)      This Option may be exercised, in whole or in part, in
accordance with the following schedule. Except only as specifically provided
elsewhere herein or in the Plan, this Option shall be exercisable in the
following cumulative installments as follows:

[Note: the vesting schedule is to be completed upon grant of the Option]

                  (b)      Notwithstanding the vesting schedule set forth above,
in the event of Optionee's death, Disability or other termination of Optionee's
Continuous Status as an Employee or Consultant (regardless of the reason),
Options that have not become vested and exercisable under Section 2(a) shall
cease vesting, shall not be exercisable and shall automatically be forfeited and
cancelled on the date of such termination.

                  (c)      Notwithstanding the vesting schedule set forth above,
and so long as the Option has not been terminated, in the event of a "Change of
Control" as defined in the Plan, the vesting schedule above shall be accelerated
such that the Option shall be deemed to be fully vested immediately prior to
such event.

[Note: delete the foregoing paragraph if the Option does not automatically
accelerate upon a change of control.]

         3.       Exercise of Option.
                  ------------------

                  (a)      This Option shall be exercisable, with respect to any
or all of the Shares, during its term in accordance with the vesting schedule
set out in Section 2 hereof and in accordance with the applicable provisions of
the Plan and this Option Agreement. In the event of Optionee's death, Disability
or other termination of Optionee's Continuous Status as an Employee or
Consultant (regardless of the reason), this Option shall be exercisable only in
accordance with the applicable provisions of the Plan and this Option Agreement
(including Section 2(b) and Section 4 hereof).

                  (b)      To exercise this Option, Optionee must deliver to the
Company an executed exercise agreement in the form attached hereto as Exhibit A
(the "Exercise Agreement") which shall state the election to exercise the
Option, the number of Shares in respect of which the Option is being exercised
(this Option may be exercised in one or more installments, provided that this
Option may not be exercised as to fewer than one-hundred (100) Shares), any
restrictions (including restrictions on transfer) imposed on the Shares, and
such other representations and agreements as to the Optionee's investment intent
with respect to such shares of Common Stock as may be required by the Company
pursuant to the provisions of the Plan. The Exercise Agreement shall be signed
by the Optionee and shall be delivered in person or by certified mail to the
Secretary of the Company. The Exercise Agreement shall be accompanied by payment
of the Exercise Price Per Share multiplied by the number of Shares in respect of
which the Option is being exercised (the "Exercise Price"). This Option shall be
deemed to be exercised upon receipt by the Company of such executed Exercise
Agreement accompanied by the Exercise Price.

                  (c)      The Optionee shall, upon notification of the amount
due (if any) as a result of the exercise of the Option and prior to or
concurrent with delivery of the certificate representing the Shares, pay to the
Company as provided in the Plan amounts necessary to satisfy applicable federal,
state and local tax withholding requirements.

                  (d)      No Shares will be issued pursuant to the exercise of
an Option unless such issuance and such exercise shall comply with this Option
Agreement and Section 19 of the Plan.

                                       22

<PAGE>

Assuming such compliance, for income tax purposes the Shares shall be considered
transferred to the Optionee on the date on which the Option is exercised with
respect to such Shares.

         4.       Termination Period. Optionee may exercise that portion of the
Option that is vested on the date of termination (or becomes vested by reason of
such termination pursuant to this Agreement) for three months (or such shorter
period provided for elsewhere herein or in the Plan) after termination of
Optionee's Continuous Status as an Employee or Consultant, or for such longer
period upon Optionee's death or Disability as provided in the Plan. If the
Optionee's status changes from Employee to Consultant or Consultant to Employee,
this Option Agreement shall remain in effect. In no event may Optionee exercise
this Option after the Term/Expiration Date as provided above in Section 1.
Notwithstanding the foregoing, in the event that Optionee's Continuous Status as
an Employee or Consultant is terminated by the Company for Cause, this Option
(both the vested and unvested portions thereof) will terminate on the date of
such termination and will not be exercisable thereafter. For purposes of this
Option Agreement, "Cause" means the occurrence of any of the following events or
reasons:

                  (a)      Optionee's conviction for a felony offense or
commission by Optionee of any act abhorrent to the community that the Company
considers materially damaging to or tending to discredit the reputation of the
Company;

                  (b)      Dishonesty, fraud, willful misconduct, unlawful
discrimination or theft on the part of Optionee;

                  (c)      Optionee's using for Optionee's own benefit any
confidential or proprietary information of the Company, or willfully or
negligently divulging any such information to third parties without the prior
written consent of the Company;

                  (d)      Optionee's public drunkenness, public use of illegal
substances or drugs or the use, possession, distribution or being under the
influence of alcohol or illegal substances or drugs in the workplace (the only
exception is that Optionee may consume alcohol reasonably and responsibly, if he
or she so chooses, at legitimate business events and functions where alcohol is
legally available);

                  (e)      the determination by the Company that Optionee has
continually failed or refused to comply, after notice of and a reasonable
opportunity to cure such failure or refusal, with the policies, standards,
regulations, instructions, or directions of the Company as they currently exist
or as they may be modified from time to time; or

                  (f)      any violation by the Optionee of any Noncompetition,
Nondiversion, or Nondisclosure Agreement between the Optionee and the Company
(the "Noncompetition Agreement"), or any part of any noncompetition,
nondiversion, nondisclosure or similar agreement that amends, extends,
supplements, modifies or supersedes the Noncompetition Agreement.

         5.       Method of Payment. The purchase price of Shares acquired
pursuant to the Option shall be paid as set forth in the Plan. THE USE OF SHARES
OF STOCK ACQUIRED OR TO BE ACQUIRED TO PAY FOR EXERCISED SHARES MAY HAVE INCOME
TAX CONSEQUENCES FOR THE OPTIONEE.

         6.       Restrictions on Exercise. This Option may not be exercised
until such time as the Plan has been approved by the shareholders of the
Company, and may not be exercised if the issuance of such Shares upon such
exercise or the method of payment of consideration for such shares would
constitute a violation of any applicable federal or state securities or other
law or regulation, including any rule under Part 221 of Title 12 of the Code of
Federal Regulations as promulgated by the Federal Reserve Board.

                                       23

<PAGE>

         7.       Non-Transferability of Option. This Option may not be
transferred in any manner otherwise than by will or by the laws of descent or
distribution or as otherwise set forth in the Plan and may be exercised during
the lifetime of Optionee only by Optionee or a permitted transferee as set forth
in the Plan. The terms of the Plan and this Option Agreement shall be binding
upon the executors, administrators, heirs, successors and assigns of the
Optionee.

         8.       Term of Option. This Option may be exercised only within the
term set out in Section 1 hereof, and may be exercised during such term only in
accordance with the Plan and the terms of this Option Agreement. The limitations
set forth in Sections 5, 6 and 15 of the Plan regarding Options designated as
Incentive Stock Options and Options granted to more than ten percent (10%)
shareholders shall apply to this Option.

         9.       Changes in Capital Structure. The Optionee agrees and
acknowledges that the Company shall have the right at any time and from time to
time after the date of this Option Agreement to authorize additional classes or
series of capital stock, some of which may entitle the holders thereof to
greater rights than the holders of the Common Stock into which this Option is
convertible, and to issue shares thereunder, subject only to the limits imposed
by Applicable Laws.

         10.      Tax Consequences. The grant and/or exercise of the Option will
have federal and state income tax consequences. THE OPTIONEE SHOULD CONSULT A
TAX ADVISER UPON THE GRANT OF THE OPTION AND BEFORE EXERCISING THE OPTION OR
DISPOSING OF THE SHARES ACQUIRED UPON EXERCISE, PARTICULARLY WITH RESPECT TO HIS
OR HER STATE'S TAX LAWS.

         11.      Entire Agreement. The Plan is incorporated herein by
reference. The Plan and this Option Agreement constitute the entire agreement of
the parties with respect to the subject matter hereof and supersede in their
entirety all prior undertakings and agreements of the Company and Optionee with
respect to the subject matter hereof, and this Option Agreement may not be
amended except by means of a writing signed by the Company and Optionee. If any
inconsistency should exist between the terms and conditions of this Option
Agreement and the Plan, the Plan shall govern and control.

         12.      Governing Law. This Option Agreement is governed by Texas law
except for that body of law pertaining to conflict of laws.

         13.      Warranties, Representations and Covenants. The undersigned
Optionee warrants and represents that he or she has reviewed the Plan and this
Option Agreement in their entirety, has had an opportunity to obtain the advice
of counsel prior to executing this Option Agreement and fully understands all of
the provisions of the Plan and this Option Agreement. Optionee hereby agrees to
accept as binding, conclusive and final all decisions or interpretations of the
Committee upon any questions relating to the Plan and this Option Agreement.
Optionee further agrees to notify the Company upon any change in the residence
address indicated below. OPTIONEE ACKNOWLEDGES AND AGREES THAT THE VESTING OF
SHARES PURSUANT TO THE OPTION HEREOF IS EARNED ONLY BY CONTINUING CONSULTANCY OR
EMPLOYMENT AT THE WILL OF THE COMPANY (NOT THROUGH THE ACT OF BEING HIRED, BEING
GRANTED THIS OPTION OR ACQUIRING SHARES HEREUNDER). OPTIONEE FURTHER
ACKNOWLEDGES AND AGREES THAT NOTHING IN THIS OPTION AGREEMENT, NOR IN THE PLAN,
WHICH IS INCORPORATED HEREIN BY REFERENCE, SHALL CONFER UPON OPTIONEE ANY RIGHT
WITH RESPECT TO CONTINUATION OF EMPLOYMENT OR CONSULTANCY BY THE COMPANY, NOR
SHALL IT INTERFERE IN ANY WAY WITH OPTIONEE'S RIGHT OR THE COMPANY'S RIGHT TO
TERMINATE OPTIONEE'S EMPLOYMENT OR CONSULTANCY AT ANY TIME, WITH OR WITHOUT
CAUSE.

                                       24

<PAGE>

         14.      Relation to Other Benefits; Termination of Employment. Any
economic or other benefit to the Optionee under this Option Agreement or the
Plan will not be taken into account in determining any benefits to which the
Optionee may be entitled under any profit-sharing, retirement or similar benefit
or compensation plan maintained by the Company and will not affect the amount of
any life insurance coverage available to any beneficiary under any life
insurance plan covering employees of the Company. No provision of this Option
Agreement will limit in any way whatsoever any right that the Company may
otherwise have to terminate the employment or adjust the compensation of the
Optionee at any time.

         [Note: If applicable, insert here any other terms and conditions of the
Option as determined by the Committee, such as any specified performance goals
or other criteria which must be attained for the vesting of the Option; any
additional restrictions or limitations applicable to the Option; and any
additional vesting, exchange, surrender, cancellation, acceleration,
termination, exercise or forfeiture provisions applicable to the Option.]

                                       THE COMPANY:

                                       ASCENDANT SOLUTIONS, INC.



                                       By:
                                           -------------------------------------
                                       Name:
                                             -----------------------------------
                                       Title:
                                              ----------------------------------


                                       OPTIONEE:


                                       -----------------------------------------
                                       Signature


                                       -----------------------------------------
                                       Print Name


                                       -----------------------------------------
                                       Residence Address


                                       -----------------------------------------
                                       Area Code/Telephone Number

                                       25

<PAGE>

                                             Exhibit A to Stock Option Agreement
                                             -----------------------------------
                                                             (Standard Exercise)
                                                             -------------------




                            ASCENDANT SOLUTIONS, INC.

                           2002 EQUITY INCENTIVE PLAN

                               EXERCISE AGREEMENT

                               (Standard Exercise)



Ascendant Solutions, Inc.
15455 North Dallas Parkway
Suite 500
Addison, Texas 75001

Attention: Secretary

         1.       Exercise of Option. Effective as of today, ________, 200__,
the undersigned ("Purchaser") hereby elects, pursuant to this Exercise Agreement
(this "Exercise Agreement"), to exercise _____ options (the "Options") to
purchase ______ shares (the "Shares") of the Common Stock of Ascendant
Solutions, Inc., (the "Company") under and pursuant to the 2002 Equity Incentive
Plan (the "Plan") and the Stock Option Agreement dated _______, 200__ (the
"Option Agreement"). The purchase price for the Shares shall be $_____, as
specified in the Option Agreement. Unless otherwise defined herein, all defined
terms used herein shall have the meanings set forth in the Plan.

         2.

                  Delivery of Payment. Purchaser herewith delivers to the
Company the full purchase price for the Shares of ____________________________.
THE USE OF SHARES OF STOCK ACQUIRED OR TO BE ACQUIRED FOR EXERCISED SHARES MAY
HAVE INCOME TAX CONSEQUENCES FOR THE PURCHASER.

         3.       Representations and Warranties of Purchaser; Compliance with
Securities Laws. Purchaser represents and warrants to the Company that:

                  (a)      Agrees to Terms of the Plan. Purchaser has received a
copy of the Plan and the Option Agreement, has read and understands the terms of
the Plan and the Option Agreement, and agrees to be bound by their terms and
conditions. Purchaser acknowledges that there may be adverse tax consequences
upon exercise of the Options or disposition of the Shares, and that Purchaser
should consult a tax adviser prior to such exercise or disposition.

                  (b)      Purchase for Own Account for Investment. Purchaser is
purchasing the Shares for Purchaser's own account for investment purposes only
and not with a view to, or for sale in connection with, a distribution of the
Shares within the meaning of the Securities Act of 1933, as amended (the
"Securities Act"). Purchaser has no present intention of selling or otherwise
disposing of all or any portion of the Shares and no one other than Purchaser
has any beneficial ownership of any of the Shares.

                  (c)      Access to Information. Purchaser has had access to
all information regarding the Company and its present and prospective business,
assets, liabilities and financial condition that

                                       26

<PAGE>

Purchaser reasonably considers important in making the decision to purchase the
Shares and Purchaser has had ample opportunity to ask questions of the Company's
representatives concerning such matters and this investment.

                  (d)      Understanding of Risks. Purchaser is fully aware of:
(i) the highly speculative nature of the investment in the Shares; (ii) the
financial hazards involved; (iii) the lack of liquidity of the Shares and the
restrictions on transferability of the Shares (e.g., that Purchaser may not be
able to sell or dispose of the Shares or use them as collateral for loans); (iv)
the qualifications and backgrounds of the management of the Company; and (v) the
tax consequences of investment in the Shares. Purchaser is capable of evaluating
the merits and risks of this investment, has the ability to protect Purchaser's
own interests in this transaction and is financially capable of bearing a total
loss of this investment.

                  (e)      No General Solicitation. At no time was Purchaser
presented with or solicited by any publicly issued or circulated newspaper,
mail, radio, television or other form of general advertising or solicitation in
connection with the offer sale and purchase of the Shares.

                  (f)      Compliance with U.S. Federal Securities Laws and
State Securities Laws. Purchaser understands and acknowledges that the Shares
have not been registered with the Securities and Exchange Commission (the "SEC")
under the Securities Act and that, notwithstanding any other provision of this
Exercise Agreement to the contrary, the exercise of any rights to purchase any
Shares is expressly conditioned upon compliance with the Securities Act and all
applicable state securities laws. Purchaser agrees to cooperate with the Company
to ensure compliance with such laws.

         4.       Restricted Securities; Restrictions on Transfers.
                  ------------------------------------------------

                  (a)      No Transfer Unless Registered or Exempt. Purchaser
understands that Purchaser may not transfer any Shares except pursuant to this
Exercise Agreement and unless such Shares are registered under the Securities
Act or qualified under applicable state securities laws or unless, in the
opinion of counsel to the Company, exemptions from such registration and
qualification requirements are available. Purchaser understands that only the
Company may file a registration statement with the SEC and that the Company is
under no obligation to do so with respect to the Shares. Purchaser has also been
advised that exemptions from registration and qualification may not be available
or may not permit Purchaser to transfer all or any of the Shares in the amounts
or at the times proposed by Purchaser.

                  (b)      SEC Rule 144. In addition, Purchaser has been advised
that SEC Rule 144 promulgated under the Securities Act, which permits certain
limited sales of unregistered securities, is not presently available with
respect to the Shares and, in any event, requires that the Shares be held for a
minimum of one (1) year, and in certain cases two (2) years, after they have
been purchased and paid for (within the meaning of Rule 144). Purchaser
understands that Rule 144 may indefinitely restrict transfer of the Shares so
long as Purchaser remains an "affiliate" of the Company or if "current public
information" about the Company (as defined in Rule 144) is not publicly
available.

                  (c)      Disposition of Shares. Purchaser hereby agrees that
Purchaser shall make no disposition of the Shares unless and until:

                           (i)      Purchaser shall have complied with all
requirements of this Exercise Agreement applicable to the disposition of the
Shares;

                           (ii)     Purchaser shall have provided the Company
with written assurances, in form and substance satisfactory to counsel for the
Company, that (i) the proposed disposition does not require registration of the
Shares under the Securities Act or (ii) all appropriate action necessary for

                                       27

<PAGE>

compliance with the registration requirements of the Securities Act or any
exemption from registration available under the Securities Act (including Rule
144) has been taken; and

                           (iii)    Purchaser shall have provided the Company
with such other written assurances and agreements, in form and substance
satisfactory to the Company, as may be requested by the Company pursuant to the
Plan.

                  (d)      Restrictions on Transfer. Subject to Section 6(f)
below, Purchaser shall not sell, transfer, assign, grant a lien or security
interest in, pledge, hypothecate, encumber, gift or otherwise dispose of
("Transfer") any Shares without the prior written consent of the Company. In
addition, any proposed Transfer shall be subject to the Company's Right of First
Refusal (as defined below) pursuant to Section 6 below.

                  (e)      Transferee Obligations. Each person (other than the
Company) to whom the Shares are Transferred by means of one of the permitted
Transfers specified in Section 6(f) of this Exercise Agreement must, as a
condition precedent to the validity of such Transfer, acknowledge in writing to
the Company that such person is bound by the provisions of this Exercise
Agreement and that the transferred Shares are subject to (i) the Company's Right
of First Refusal granted hereunder and (ii) the market stand-off provisions of
Section 5, to the same extent such Shares would be so subject if retained by the
Purchaser.

         5.       Market Standoff Agreement. Purchaser agrees in connection with
any registration of the Company's securities that, upon the request of the
Company or the underwriters managing any public offering of the Company's
securities, Purchaser will not sell or otherwise dispose of any Shares without
the prior written consent of the Company or such underwriters, as the case may
be, for such period of time (not to exceed 180 days) after the effective date of
such registration requested by such managing underwriters and subject to all
restrictions as the Company or the underwriters may specify.

         6.       Company's Right of First Refusal. Before any Shares acquired
by Purchaser hereunder and held by Purchaser or any permitted transferee of such
Shares (either being sometimes referred to herein as the "Purchaser") may be
Transferred, the Company and/or its assignee(s) shall have an assignable right
of first refusal to purchase the Shares proposed to be Transferred (the "Offered
Shares") on the terms and conditions set forth in this Section 6 (the "Right of
First Refusal").

                  (a)      Notice of Proposed Transfer. The Purchaser of the
Offered Shares shall deliver to the Company a written notice (the "Notice")
stating: (i) the Purchaser's bona fide intention to Transfer the Offered Shares;
(ii) the name of each proposed bona fide purchaser or other transferee
("Proposed Transferee"); (iii) the number of Offered Shares to be Transferred to
each Proposed Transferee; (iv) the bona fide cash price or other consideration
for which the Purchaser proposes to Transfer the Offered Shares (the "Offered
Price") and (v) that the Purchaser will offer to Transfer the Offered Shares to
the Company and/or its assignee(s) at the Offered Price as provided in this
Section 6.

                  (b)      Exercise of Right of First Refusal: At any time
within thirty (30) days after the date of the Notice, the Company and/or its
assignee(s) may, by giving written notice to the Purchaser, elect to purchase
all (or, with the consent of the Purchaser, less than all) the Offered Shares
proposed to be Transferred to any one or more of the Proposed Transferees named
in the Notice, at the purchase price determined as specified below.

                  (c)      Purchase Price: The purchase price for the Offered
Shares purchased under this Section 6 will be the Offered Price. If the Offered
Price includes consideration other than cash, then the

                                       28

<PAGE>

cash equivalent value of the non-cash consideration shall conclusively be deemed
to be the value of such non-cash consideration as determined in good faith by
the Board.

                  (d)      Payment: Payment of the Offered Price will be
payable, at the option of the Company and/or its assignee(s) (as applicable), by
check or by cancellation of all or a portion of any outstanding indebtedness of
the Purchaser to the Company (or to such assignee, in the case of a purchase of
Offered Shares by such assignee) or by any combination thereof. The Offered
Price will be paid without interest within sixty (60) days after the Company's
receipt of the Notice, or, at the option of the Company and/or its assignee(s),
in the manner and at the time(s) set forth in the Notice.

                  (e)      Transfer. If all of the Offered Shares proposed in
the Notice to be Transferred to a given Proposed Transferee are not purchased by
the Company and/or its assignee(s) as provided in this Section 6, then the
Purchaser may Transfer such Offered Shares to that Proposed Transferee at the
Offered Price or at a higher price; provided that such Transfer is consummated
within 120 days after the date of the Notice, and provided further, that (i) any
such Transfer is effected in compliance with all applicable securities laws and
(ii) the Proposed Transferee agrees in writing that the provisions of this
Section 6 will continue to apply to the Offered Shares in the hands of such
Proposed Transferee. If the Offered Shares described in the Notice are not
Transferred to the Proposed Transferee within such 120 day period, then a new
Notice must be given to the Company, and the Company will again be offered the
Right of First Refusal before any Shares held by the Purchaser may be
Transferred.

                  (f)      Exempt Transfers: Notwithstanding anything to the
contrary in Section 4(d) or in this Section 6, the following Transfers of
Offered Shares will be exempt from the Right of First Refusal: (i) the Transfer
of any or all of the Offered Shares during Purchaser's lifetime by gift or on
Purchaser's death by will or intestacy to any Immediate Family Member (as such
term is defined in the Plan) of Purchaser, provided that each transferee or
other recipient agrees in a writing satisfactory to the Company that the
provisions of this Section 6 will continue to apply to the Transferred Shares in
the hands of such transferee or other recipient; (ii) any Transfer of Shares
made pursuant to a statutory merger or statutory consolidation of the Company
with or into another corporation or corporations (except that the Right of First
Refusal will continue to apply thereafter to such Shares, in which case the
surviving corporation of such merger or consolidation shall succeed to the
rights of the Company under this Section 6 unless the agreement of merger or
consolidation expressly otherwise provides); or (iii) any Transfer of Shares
pursuant to the winding up and dissolution of the Company.

                  (g)      Termination of Right of First Refusal: The Company's
Right of First Refusal will terminate on the IPO Date.

         7.       Rights as Shareholder. The Purchaser shall not be deemed to be
the holder of, or to have any of the rights of a holder with respect to, any
Shares for which such Option is exercised including, but not limited to, rights
to vote or to receive dividends unless and until the Purchaser has satisfied all
requirements for exercise of the Option pursuant to its terms, the certificates
evidencing such Shares have been issued and the Purchaser has become a record
holder of such Shares. A share certificate for the number of Shares so acquired
shall be issued to the Purchaser as soon as practicable after exercise of the
Option. No adjustment will be made for a dividend or other right for which the
record date is prior to the date all the conditions set forth above are
satisfied, except as provided in Section 13 of the Plan.

         8.       Tax Consultation. Purchaser understands that Purchaser may
suffer adverse tax consequences as a result of Purchaser's purchase or
disposition of the Shares. Purchaser represents that Purchaser has consulted
with any tax consultants Purchaser deems advisable in connection with the
purchase or disposition of the Shares and that Purchaser is not relying on the
Company for any tax advice.

                                       29

<PAGE>

         9.       Legends. Purchaser understands and agrees that the Company
will cause a legend regarding the Company's Right of First Refusal to be placed
upon any certificate(s) or other documents or instruments evidencing ownership
of the Shares by the Purchaser, in addition to any other legends required under
federal and state securities laws including the following legends:

         "THE SHARES REPRESENTED BY THIS CERTIFICATE HAVE NOT BEEN REGISTERED
         UNDER THE SECURITIES ACT OF 1933. THE SHARES MAY NOT BE SOLD OR OFFERED
         FOR SALE IN THE ABSENCE OF (I) AN EFFECTIVE REGISTRATION STATEMENT FOR
         THE SHARES UNDER SUCH ACT, (II) A 'NO ACTION' LETTER OF THE SECURITIES
         AND EXCHANGE COMMISSION WITH RESPECT TO SUCH SALE OR OFFER, OR (III) AN
         OPINION OF COUNSEL SATISFACTORY TO THE CORPORATION THAT REGISTRATION
         UNDER SUCH ACT IS NOT REQUIRED WITH RESPECT TO SUCH SALE OR OFFER."

         "THE SHARES REPRESENTED BY THIS CERTIFICATE MAY NOT BE SOLD, ASSIGNED,
         TRANSFERRED, ENCUMBERED OR IN ANY MANNER DISPOSED OF, EXCEPT IN
         COMPLIANCE WITH THE TERMS OF WRITTEN AGREEMENTS BETWEEN THE CORPORATION
         AND THE REGISTERED HOLDER OF THE SHARES (OR THE PREDECESSOR IN INTEREST
         TO THE SHARES). SUCH AGREEMENTS GRANT CERTAIN RIGHTS OF FIRST REFUSAL
         TO THE CORPORATION. THE SECRETARY OF THE CORPORATION WILL UPON WRITTEN
         REQUEST FURNISH A COPY OF SUCH AGREEMENTS TO THE HOLDER HEREOF WITHOUT
         CHARGE."

         10.      Entire Agreement. The Plan and the Option Agreement are
incorporated herein by reference. This Exercise Agreement, the Plan and the
Option Agreement constitute the entire agreement of the parties with respect to
the subject matter hereof and supersede in their entirety all prior undertakings
and agreements of the Company and Purchaser with respect to the subject matter
hereof, and this Exercise Agreement may not be amended except by means of a
writing signed by the Company and Purchaser. If any inconsistency should exist
between the terms and conditions of this Exercise Agreement and the terms of the
Option Agreement, the terms of the Option Agreement shall govern and control. If
any inconsistency should exist between the terms and conditions of this Exercise
Agreement and the terms of the Plan, the terms of the Plan shall govern and
control.

         11.      Governing Law. This Exercise Agreement is governed by Texas
law except for that body of law pertaining to conflict of laws.

                                       30

<PAGE>

Submitted by:                          Accepted by:

PURCHASER:                             THE COMPANY:

                                       ASCENDANT SOLUTIONS, INC.

                                       By:
------------------------------             ------------------------------
Signature

                                       Its:
------------------------------              -----------------------------
Print Name

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

                                       15455 North Dallas Parkway
------------------------------         Suite 500
                                       Addison, Texas 75001
------------------------------         Attn: Secretary

                                       31

<PAGE>

                                         Exhibit B to 2002 Equity Incentive Plan
                                         ---------------------------------------




                            ASCENDANT SOLUTIONS, INC.

                           2002 EQUITY INCENTIVE PLAN

                             STOCK OPTION AGREEMENT

                            (Immediately Exercisable)



[Optionee's name and address]

         This Stock Option Agreement (this "Option Agreement") is entered into
as of ______ __________, 2002, by and between you ("Optionee") and Ascendant
Solutions, Inc. (the "Company"). Unless otherwise defined herein, all defined
terms used herein shall have the meanings set forth in the 2002 Equity Incentive
Plan of the Company (the "Plan").

         1.       Grant of Option. The Company hereby grants to Optionee an
option (the "Option") to purchase the number of shares (the "Shares") of the
Common Stock, par value $.0001 per share (the "Common Stock"), of the Company
set forth below at the exercise price and on the other terms and conditions set
forth below, subject to the terms and conditions of this Option Agreement and
the Plan (which is incorporated herein by reference), including the provisions
thereof relating to increases in the number of shares covered by this Option
upon the occurrence of certain specified events, as follows:

         Grant Number                                ___________________________
         Date of Grant ("Date of Grant")             ___________________________
         Vesting Commencement Date                   ___________________________
         Exercise Price per Share ("Exercise         ___________________________
         Price Per Share")
         Total Number of Shares Granted              ___________________________
         Total Exercise Price                        ___________________________
         Type of Option:
                  ____ Incentive Stock Option
                  ____ Nonqualified Stock Option
         Term/Expiration Date: _________________
         (No more than 10 years from date
         of grant, 5 years for certain grants)

         If designated above as an Incentive Stock Option, this Option is
intended (subject to Section 5(b) of the Plan) to qualify as an Incentive Stock
Option as defined in Section 422 of the Code; provided, however, the Company has
not made, and will not be deemed to make hereby, any representations or
warranties to Optionee with respect to such qualification.

                                       32

<PAGE>

         2.       Vesting Schedule.
                  ----------------

                  (a)      Except only as specifically provided elsewhere herein
or in the Plan, the Shares issuable upon exercise of this Option shall become
vested, in whole or in part, in cumulative installments in accordance with the
following vesting schedule:

[Note: the vesting schedule is to be completed upon grant of the Option]

Shares that are vested pursuant to the schedule set forth in this Section 2(a)
are "Vested Shares." Shares that are not vested pursuant to the schedule set
forth in this Section 2(a) are "Unvested Shares."

                  (b)      Notwithstanding the vesting schedule set forth above,
in the event of Optionee's death, Disability or other termination of Optionee's
Continuous Status as an Employee or Consultant (regardless of the reason),
Shares that have not become vested under Section 2(a) shall cease vesting and
shall automatically become subject to the Company's Repurchase Option pursuant
to Section 6 of the Exercise Agreement (as defined below) on the date of such
termination.

                  (c)      Notwithstanding the vesting schedule set forth above,
and so long as the Option has not been terminated, in the event of a "Change of
Control" as defined in the Plan, the vesting schedule above shall be accelerated
such that the Shares issuable upon exercise of this Option shall be deemed to be
fully vested immediately prior to such event.

[Note: delete the foregoing paragraph if the Option does not automatically
accelerate upon a change of control.]

         3.       Exercise of Option.
                  ------------------

                  (a)      This Option is immediately exercisable with respect
to any or all of the Vested and Unvested Shares, during its term and in
accordance with the applicable provisions of the Plan and this Option Agreement.
However, any Unvested Shares issued upon exercise of this Option will be subject
to the restrictions set forth in Section 6 of the Exercise Agreement until such
Shares become Vested Shares in accordance with the schedule set forth in Section
2 hereof. In the event of Optionee's death, Disability or other termination of
Optionee's Continuous Status as an Employee or Consultant (regardless of the
reason), this Option shall be exercisable only in accordance with the applicable
provisions of the Plan and this Option Agreement (including Section 3(b) and
Section 4 hereof).

                  (b)      Notwithstanding anything in Section 3(a) to the
contrary, in the event of Optionee's death, Disability or other termination of
Optionee's Continuous Status as an Employee or Consultant (regardless of the
reason), this Option, to the extent not already exercised, shall cease to be
exercisable as to any Unvested Shares and shall automatically be forfeited and
cancelled with respect to such Unvested Shares.

                  (c)      To exercise this Option, Optionee must deliver to the
Company an executed exercise agreement in the form attached hereto as Exhibit A
(the "Exercise Agreement") which shall state the election to exercise the
Option, the number of Shares in respect of which the Option is being exercised
(this Option may be exercised in one or more installments, provided that this
Option may not be exercised as to fewer than one-hundred (100) Shares), any
restrictions (including restrictions on transfer) imposed on the Shares, and
such other representations and agreements as to the Optionee's investment intent
with respect to such shares of Common Stock as may be required by the Company
pursuant to the provisions of the Plan. The Exercise Agreement shall be signed
by the Optionee and shall be delivered in person or by certified mail to the
Secretary of the Company. The Exercise Agreement shall be

                                       33

<PAGE>

accompanied by payment of the Exercise Price Per Share multiplied by the number
of Shares in respect of which the Option is being exercised (the "Exercise
Price"). This Option shall be deemed to be exercised upon receipt by the Company
of such executed Exercise Agreement accompanied by the Exercise Price.

                  (d)      The Optionee shall, upon notification of the amount
due (if any) as a result of the exercise of the Option and prior to or
concurrent with delivery of the certificate representing the Shares, pay to the
Company as provided in the Plan amounts necessary to satisfy applicable federal,
state and local tax withholding requirements.

                  (e)      No Shares will be issued pursuant to the exercise of
an Option unless such issuance and such exercise shall comply with this Option
Agreement and Section 19 of the Plan. Assuming such compliance, for income tax
purposes the Shares shall be considered transferred to the Optionee on the date
on which the Option is exercised with respect to such Shares.

         4.       Termination Period. Optionee may exercise that portion of the
Option covering Vested Shares on the date of termination (or that covers Shares
that become Vested Shares by reason of such termination pursuant to this
Agreement) for three months (or such shorter period provided for elsewhere
herein or in the Plan) after termination of Optionee's Continuous Status as an
Employee or Consultant, or for such longer period upon Optionee's death or
Disability as provided in the Plan. If the Optionee's status changes from
Employee to Consultant or Consultant to Employee, this Option Agreement shall
remain in effect. In no event may Optionee exercise this Option after the
Term/Expiration Date as provided above in Section 1. Notwithstanding the
foregoing, in the event that Optionee's Continuous Status as an Employee or
Consultant is terminated by the Company for Cause, this Option (both the portion
covering Vested Shares and the portion covering Unvested Shares), to the extent
not already exercised, will terminate on the date of such termination and will
not be exercisable thereafter. For purposes of this Option Agreement, "Cause"
means the occurrence of any of the following events or reasons:

                  (a)      Optionee's conviction for a felony offense or
commission by Optionee of any act abhorrent to the community that the Company
considers materially damaging to or tending to discredit the reputation of the
Company;

                  (b)      Dishonesty, fraud, willful misconduct, unlawful
discrimination or theft on the part of Optionee;

                  (c)      Optionee's using for Optionee's own benefit any
confidential or proprietary information of the Company, or willfully or
negligently divulging any such information to third parties without the prior
written consent of the Company;

                  (d)      Optionee's public drunkenness, public use of illegal
substances or drugs or the use, possession, distribution or being under the
influence of alcohol or illegal substances or drugs in the workplace (the only
exception is that Optionee may consume alcohol reasonably and responsibly, if he
or she so chooses, at legitimate business events and functions where alcohol is
legally available);

                  (e)      the determination by the Company that Optionee has
continually failed or refused to comply, after notice of and a reasonable
opportunity to cure such failure or refusal, with the policies, standards,
regulations, instructions, or directions of the Company as they currently exist
or as they may be modified from time to time; or

                  (f)      any violation by the Optionee of any Noncompetition,
Nondiversion, or Nondisclosure Agreement between the Optionee and the Company
(the "Noncompetition Agreement"),

                                       34

<PAGE>

or any part of any noncompetition, nondiversion, nondisclosure or similar
agreement that amends, extends, supplements, modifies or supersedes the
Noncompetition Agreement.

         5.       Method of Payment. The purchase price of Shares acquired
pursuant to the Option shall be paid as set forth in the Plan. THE USE OF SHARES
OF STOCK ACQUIRED OR TO BE ACQUIRED TO PAY FOR EXERCISED SHARES MAY HAVE INCOME
TAX CONSEQUENCES FOR THE OPTIONEE.

         6.       Restrictions on Exercise. This Option may not be exercised
until such time as the Plan has been approved by the shareholders of the
Company, and may not be exercised if the issuance of such Shares upon such
exercise or the method of payment of consideration for such shares would
constitute a violation of any applicable federal or state securities or other
law or regulation, including any rule under Part 221 of Title 12 of the Code of
Federal Regulations as promulgated by the Federal Reserve Board.

         7.       Non-Transferability of Option. This Option may not be
transferred in any manner otherwise than by will or by the laws of descent or
distribution or as otherwise set forth in the Plan and may be exercised during
the lifetime of Optionee only by Optionee or a permitted transferee as set forth
in the Plan. The terms of the Plan and this Option Agreement shall be binding
upon the executors, administrators, heirs, successors and assigns of the
Optionee.

         8.       Term of Option. This Option may be exercised only within the
term set out in Section 1 hereof, and may be exercised during such term only in
accordance with the Plan and the terms of this Option Agreement. The limitations
set forth in Sections 5, 6 and 15 of the Plan regarding Options designated as
Incentive Stock Options and Options granted to more than ten percent (10%)
shareholders shall apply to this Option.

         9.       Changes in Capital Structure. The Optionee agrees and
acknowledges that the Company shall have the right at any time and from time to
time after the date of this Option Agreement to authorize additional classes or
series of capital stock, some of which may entitle the holders thereof to
greater rights than the holders of the Common Stock into which this Option is
convertible, and to issue shares thereunder, subject only to the limits imposed
by Applicable Laws.

         10.      Tax Consequences. The grant and/or exercise of the Option
and/or the lapse of restrictions on the Shares will have federal and state
income tax consequences. THE OPTIONEE SHOULD CONSULT A TAX ADVISER UPON THE
GRANT OF THE OPTION AND BEFORE EXERCISING THE OPTION OR DISPOSING OF THE SHARES
ACQUIRED UPON EXERCISE, PARTICULARLY WITH RESPECT TO HIS OR HER STATE'S TAX
LAWS.

         11.      Entire Agreement. The Plan is incorporated herein by
reference. The Plan and this Option Agreement constitute the entire agreement of
the parties with respect to the subject matter hereof and supersede in their
entirety all prior undertakings and agreements of the Company and Optionee with
respect to the subject matter hereof, and this Option Agreement may not be
amended except by means of a writing signed by the Company and Optionee. If any
inconsistency should exist between the terms and conditions of this Option
Agreement and the Plan, the Plan shall govern and control.

         12.      Governing Law. This Option Agreement is governed by Texas law
except for that body of law pertaining to conflict of laws.

         13.      Warranties, Representations and Covenants. The undersigned
Optionee warrants and represents that he or she has reviewed the Plan and this
Option Agreement in their entirety, has had an opportunity to obtain the advice
of counsel prior to executing this Option Agreement and fully understands all of
the provisions of the Plan and this Option Agreement. Optionee hereby agrees to
accept

                                       35

<PAGE>

as binding, conclusive and final all decisions or interpretations of the
Committee upon any questions relating to the Plan and this Option Agreement.
Optionee further agrees to notify the Company upon any change in the residence
address indicated below. OPTIONEE ACKNOWLEDGES AND AGREES THAT THE VESTING OF
SHARES PURSUANT TO THE OPTION HEREOF IS EARNED ONLY BY CONTINUING CONSULTANCY OR
EMPLOYMENT AT THE WILL OF THE COMPANY (NOT THROUGH THE ACT OF BEING HIRED, BEING
GRANTED THIS OPTION OR ACQUIRING SHARES HEREUNDER). OPTIONEE FURTHER
ACKNOWLEDGES AND AGREES THAT NOTHING IN THIS OPTION AGREEMENT, NOR IN THE PLAN,
WHICH IS INCORPORATED HEREIN BY REFERENCE, SHALL CONFER UPON OPTIONEE ANY RIGHT
WITH RESPECT TO CONTINUATION OF EMPLOYMENT OR CONSULTANCY BY THE COMPANY, NOR
SHALL IT INTERFERE IN ANY WAY WITH OPTIONEE'S RIGHT OR THE COMPANY'S RIGHT TO
TERMINATE OPTIONEE'S EMPLOYMENT OR CONSULTANCY AT ANY TIME, WITH OR WITHOUT
CAUSE.

         14.      Relation to Other Benefits; Termination of Employment. Any
economic or other benefit to the Optionee under this Option Agreement or the
Plan will not be taken into account in determining any benefits to which the
Optionee may be entitled under any profit-sharing, retirement or similar benefit
or compensation plan maintained by the Company and will not affect the amount of
any life insurance coverage available to any beneficiary under any life
insurance plan covering employees of the Company. No provision of this Option
Agreement will limit in any way whatsoever any right that the Company may
otherwise have to terminate the employment or adjust the compensation of the
Optionee at any time.

         [Note: If applicable, insert here any other terms and conditions of the
Option as determined by the Committee, such as any specified performance goals
or other criteria which must be attained for the vesting of the Shares; any
additional restrictions or limitations applicable to the Option or Shares; and
any additional vesting, exchange, surrender, cancellation, acceleration,
termination, exercise or forfeiture provisions applicable to the Option or
Shares.]

                                       THE COMPANY:

                                       ASCENDANT SOLUTIONS, INC.



                                       By:
                                           -------------------------------------
                                       Name:
                                             -----------------------------------
                                       Title:
                                              ----------------------------------


                                       OPTIONEE:


                                       -----------------------------------------
                                       Signature


                                       -----------------------------------------
                                       Print Name


                                       -----------------------------------------
                                       Residence Address


                                       -----------------------------------------
                                       Area Code/Telephone Number

                                       36

<PAGE>

                                             Exhibit A to Stock Option Agreement
                                             -----------------------------------
                                                       (Immediately Exercisable)
                                                       -------------------------




                            ASCENDANT SOLUTIONS, INC.

                           2002 EQUITY INCENTIVE PLAN

                               EXERCISE AGREEMENT

                            (Immediately Exercisable)



Ascendant Solutions, Inc.
15455 North Dallas Parkway
Suite 500
Addison, Texas 75001

Attention: Secretary

         1.       Exercise of Option. Effective as of today, ________, 200__,
the undersigned ("Purchaser") hereby elects, pursuant to this Exercise Agreement
(this "Exercise Agreement"), to exercise _____ options (the "Options") to
purchase ______ shares (the "Shares") of the Common Stock of Ascendant
Solutions, Inc. (the "Company") under and pursuant to the 2002 Equity Incentive
Plan (the "Plan") and the Stock Option Agreement dated _______, 200__ (the
"Option Agreement"). The purchase price for the Shares shall be $_____, as
specified in the Option Agreement. Unless otherwise defined herein, all defined
terms used herein shall have the meanings set forth in the Plan. Shares that are
vested pursuant to the schedule set forth in Section 2(a) of the Option
Agreement are referred to herein as "Vested Shares." Shares that are not vested
pursuant to the schedule set forth in Section 2(a) of the Option Agreement are
referred to herein as "Unvested Shares."

         2.       Delivery of Payment. Purchaser herewith delivers to the
Company the full purchase price for the Shares of ________________. THE USE OF
SHARES OF STOCK ACQUIRED OR TO BE ACQUIRED FOR EXERCISED SHARES MAY HAVE INCOME
TAX CONSEQUENCES FOR THE PURCHASER.

         3.       Representations and Warranties of Purchaser; Compliance with
Securities Laws. Purchaser represents and warrants to the Company that:

                  (a)      Agrees to Terms of the Plan. Purchaser has received a
copy of the Plan and the Option Agreement, has read and understands the terms of
the Plan and the Option Agreement, and agrees to be bound by their terms and
conditions. Purchaser acknowledges that there may be adverse tax consequences
upon exercise of the Options or disposition of the Shares, and that Purchaser
should consult a tax adviser prior to such exercise or disposition.

                  (b)      Purchase for Own Account for Investment. Purchaser is
purchasing the Shares for Purchaser's own account for investment purposes only
and not with a view to, or for sale in connection with, a distribution of the
Shares within the meaning of the Securities Act of 1933, as amended (the
"Securities Act"). Purchaser has no present intention of selling or otherwise
disposing of all or any portion of the Shares and no one other than Purchaser
has any beneficial ownership of any of the Shares.

                                       37

<PAGE>

                  (c)      Access to Information. Purchaser has had access to
all information regarding the Company and its present and prospective business,
assets, liabilities and financial condition that Purchaser reasonably considers
important in making the decision to purchase the Shares and Purchaser has had
ample opportunity to ask questions of the Company's representatives concerning
such matters and this investment.

                  (d)      Understanding of Risks. Purchaser is fully aware of:
(i) the highly speculative nature of the investment in the Shares; (ii) the
financial hazards involved; (iii) the lack of liquidity of the Shares and the
restrictions on transferability of the Shares (e.g., that Purchaser may not be
able to sell or dispose of the Shares or use them as collateral for loans); (iv)
the qualifications and backgrounds of the management of the Company; and (v) the
tax consequences of investment in the Shares. Purchaser is capable of evaluating
the merits and risks of this investment, has the ability to protect Purchaser's
own interests in this transaction and is financially capable of bearing a total
loss of this investment.

                  (e)      No General Solicitation. At no time was Purchaser
presented with or solicited by any publicly issued or circulated newspaper,
mail, radio, television or other form of general advertising or solicitation in
connection with the offer sale and purchase of the Shares.

                  (f)      Compliance with U.S. Federal Securities Laws and
State Securities Laws. Purchaser understands and acknowledges that the Shares
have not been registered with the Securities and Exchange Commission (the "SEC")
under the Securities Act and that, notwithstanding any other provision of this
Exercise Agreement to the contrary, the exercise of any rights to purchase any
Shares is expressly conditioned upon compliance with the Securities Act and all
applicable state securities laws. Purchaser agrees to cooperate with the Company
to ensure compliance with such laws.

         4.       Restricted Securities; Restrictions on Transfers.
                  ------------------------------------------------

                  (a)      No Transfer Unless Registered or Exempt. Purchaser
understands that Purchaser may not transfer any Shares except pursuant to this
Exercise Agreement and unless such Shares are registered under the Securities
Act or qualified under applicable state securities laws or unless, in the
opinion of counsel to the Company, exemptions from such registration and
qualification requirements are available. Purchaser understands that only the
Company may file a registration statement with the SEC and that the Company is
under no obligation to do so with respect to the Shares. Purchaser has also been
advised that exemptions from registration and qualification may not be available
or may not permit Purchaser to transfer all or any of the Shares in the amounts
or at the times proposed by Purchaser.

                  (b)      SEC Rule 144. In addition, Purchaser has been advised
that SEC Rule 144 promulgated under the Securities Act, which permits certain
limited sales of unregistered securities, is not presently available with
respect to the Shares and, in any event, requires that the Shares be held for a
minimum of one (1) year, and in certain cases two (2) years, after they have
been purchased and paid for (within the meaning of Rule 144). Purchaser
understands that Rule 144 may indefinitely restrict transfer of the Shares so
long as Purchaser remains an "affiliate" of the Company or if "current public
information" about the Company (as defined in Rule 144) is not publicly
available.

                  (c)      Disposition of Shares. Purchaser hereby agrees that
Purchaser shall make no disposition of the Shares unless and until:

                           (i)      Purchaser shall have complied with all
requirements of this Exercise Agreement applicable to the disposition of the
Shares;

                                       38

<PAGE>

                           (ii)     Purchaser shall have provided the Company
with written assurances, in form and substance satisfactory to counsel for the
Company, that (i) the proposed disposition does not require registration of the
Shares under the Securities Act or (ii) all appropriate action necessary for
compliance with the registration requirements of the Securities Act or any
exemption from registration available under the Securities Act (including Rule
144) has been taken; and

                           (iii)    Purchaser shall have provided the Company
with such other written assurances and agreements, in form and substance
satisfactory to the Company, as may be requested by the Company pursuant to the
Plan.

                  (d)      Restrictions on Transfer. Subject to Section 7(f)
below, Purchaser shall not sell, transfer, assign, grant a lien or security
interest in, pledge, hypothecate, encumber, gift or otherwise dispose of
("Transfer") any Vested Shares without the prior written consent of the Company.
In addition, any proposed Transfer of Vested Shares shall be subject to the
Company's Right of First Refusal (as defined below) pursuant to Section 7 below.
None of the Unvested Shares may be Transferred by Purchaser.

                  (e)      Transferee Obligations. Each person (other than the
Company) to whom the Vested Shares are Transferred by means of one of the
permitted Transfers specified in Section 7(f) of this Exercise Agreement must,
as a condition precedent to the validity of such Transfer, acknowledge in
writing to the Company that such person is bound by the provisions of this
Exercise Agreement and that the transferred Vested Shares are subject to (i) the
Company's Right of First Refusal granted hereunder and (ii) the market stand-off
provisions of Section 5, to the same extent such Vested Shares would be so
subject if retained by the Purchaser.

         5.       Market Standoff Agreement. Purchaser agrees in connection with
any registration of the Company's securities that, upon the request of the
Company or the underwriters managing any public offering of the Company's
securities, Purchaser will not sell or otherwise dispose of any Vested Shares
without the prior written consent of the Company or such underwriters, as the
case may be, for such period of time (not to exceed 180 days) after the
effective date of such registration requested by such managing underwriters and
subject to all restrictions as the Company or the underwriters may specify.

         6.       Unvested Shares.
                  ---------------

                  (a)      Repurchase Option. In the event of termination of
Purchaser's Continuous Status as an Employee or Consultant for any reason or no
reason, with or without Cause (as defined in the Option Agreement), or if
Purchaser, the Purchaser's legal representative, or any other holder of Unvested
Shares acquired upon exercise of the Option attempts to Transfer any Unvested
Shares prior to the Shares becoming Vested Shares in accordance with Section 2
of the Option Agreement, the Company shall have the right to repurchase the
Unvested Shares under the terms and subject to the conditions set forth herein
(the "Repurchase Option"). The Company may exercise its Repurchase Option by
written notice to the Purchaser (i) with respect to any event of termination of
Purchaser's Continuous Status as an Employee or Consultant for any reason or no
reason, with or without Cause, within sixty (60) days after termination of
Purchaser's Continuous Status as an Employee or Consultant and (ii) with respect
to any attempted Transfer of Unvested Shares prior to termination of Purchaser's
Continuous Status as an Employee or Consultant, within the period beginning on
the day the Purchaser, the Purchaser's legal representative, or any other holder
of Unvested Shares acquired upon exercise of the Option attempts to Transfer any
Unvested Shares and ending on the earlier of (A) sixty (60) days after the
Company receives written notice from the Purchaser, the Purchaser's legal
representative, or any other holder of Unvested Shares of such attempted
Transfer and (B) sixty (60) days after termination of Purchaser's Continuous
Status as an Employee or Consultant. If the Company fails to give notice within
such sixty (60) day period, the

                                       39

<PAGE>

Repurchase Option shall terminate unless the Company and the Purchaser have
extended the time for the exercise of the Repurchase Option. The purchase price
per share being repurchased by the Company under the Repurchase Option shall be
an amount equal to the Purchaser's Exercise Price (as defined in the Option
Agreement), as adjusted in the event of any stock split, reverse stock split,
subdivision, combination or similar recapitalization of the Common Stock (the
"Repurchase Price"). The Company shall pay the aggregate Repurchase Price to the
Purchaser in cash within thirty (30) days after the date of the written notice
to the Purchaser of the Company's exercise of the Repurchase Option. The Company
shall have the right to assign the Repurchase Option at any time, whether or not
such option is then exercisable, to one or more persons as may be selected by
the Company.

                  (b)      Escrow of Unvested Shares. Upon issuance, the
certificates for the Unvested Shares will be deposited in escrow with the
Secretary of the Company. Each deposited certificate will be accompanied by a
duly executed Assignment Separate from Certificate in the form of Exhibit A
attached hereto. The deposited certificates, together with any other assets or
securities from time to time deposited with the Company pursuant to the
requirements of this Exercise Agreement, will remain in escrow until such time
or times as the certificates (or other assets and securities) are to be released
or otherwise surrendered for cancellation in accordance herewith.

                  (c)      Voting and Dividend Rights. The Unvested Shares shall
constitute issued and outstanding shares of Common Stock for all corporate
purposes. Purchaser will have the right to vote such Unvested Shares, to receive
and retain all regular cash dividends and other cash equivalent distributions as
the Board may in its sole discretion designate, pay or distribute on such
Unvested Shares and to exercise all other rights, powers and privileges of a
holder of Common Stock with respect to such Unvested Shares, with the exceptions
that (A) the Purchaser will not be entitled to delivery of the stock certificate
or certificates representing any Unvested Shares until such Shares become Vested
Shares in accordance with Section 2 of the Option Agreement (unless earlier
repurchased pursuant to the Company's Repurchase Option); (B) the Company will
retain custody of the stock certificate or certificates representing the
Unvested Shares on the terms set forth in this Section 6; and (C) other than
regular cash dividends and other cash equivalent distributions as the Board may
in its sole discretion designate, pay or distribute, the Company will retain
custody of all distributions ("Retained Distributions") made or declared with
respect to the Unvested Shares (and such Retained Distributions will be subject
to the same restrictions, terms and conditions as are applicable to the Unvested
Shares).

                  (d)      Release of Shares from Escrow. Should the Company
elect to exercise its Repurchase Option under this Section 6 with respect to any
Unvested Shares, then the escrowed certificates for such Unvested Shares
(together with any other assets or securities issued with respect thereto) will
be delivered to the Company for cancellation, concurrently with the payment to
the Purchaser of an amount equal to the Repurchase Price for such Unvested
Shares, and the Purchaser will cease to have any further rights or claims with
respect to such Unvested Shares (or other assets or securities). If such
Repurchase Option is not exercised by the Company, then on the date such Shares
become Vested Shares in accordance with Section 2 of the Option Agreement, the
certificates for such Shares (as well as all other vested assets and securities)
will be released from escrow and delivered to the Purchaser.

         7.       Company's Right of First Refusal. Before any Vested Shares
acquired by Purchaser hereunder and held by Purchaser or any permitted
transferee of such Vested Shares (either being sometimes referred to herein as
the "Purchaser") may be Transferred, the Company and/or its assignee(s) shall
have an assignable right of first refusal to purchase the Vested Shares proposed
to be Transferred (the "Offered Shares") on the terms and conditions set forth
in this Section 7 (the "Right of First Refusal").

                                       40

<PAGE>

                  (a)      Notice of Proposed Transfer. The Purchaser of the
Offered Shares shall deliver to the Company a written notice (the "Notice")
stating: (i) the Purchaser's bona fide intention to Transfer the Offered Shares;
(ii) the name of each proposed bona fide purchaser or other transferee
("Proposed Transferee"); (iii) the number of Offered Shares to be Transferred to
each Proposed Transferee; (iv) the bona fide cash price or other consideration
for which the Purchaser proposes to Transfer the Offered Shares (the "Offered
Price") and (v) that the Purchaser will offer to Transfer the Offered Shares to
the Company and/or its assignee(s) at the Offered Price as provided in this
Section 7.

                  (b)      Exercise of Right of First Refusal: At any time
within thirty (30) days after the date of the Notice, the Company and/or its
assignee(s) may, by giving written notice to the Purchaser, elect to purchase
all (or, with the consent of the Purchaser, less than all) the Offered Shares
proposed to be Transferred to any one or more of the Proposed Transferees named
in the Notice, at the purchase price determined as specified below.

                  (c)      Purchase Price: The purchase price for the Offered
Shares purchased under this Section 7 will be the Offered Price. If the Offered
Price includes consideration other than cash, then the cash equivalent value of
the non-cash consideration shall conclusively be deemed to be the value of such
non-cash consideration as determined in good faith by the Board.

                  (d)      Payment: Payment of the Offered Price will be
payable, at the option of the Company and/or its assignee(s) (as applicable), by
check or by cancellation of all or a portion of any outstanding indebtedness of
the Purchaser to the Company (or to such assignee, in the case of a purchase of
Offered Shares by such assignee) or by any combination thereof. The Offered
Price will be paid without interest within sixty (60) days after the Company's
receipt of the Notice, or, at the option of the Company and/or its assignee(s),
in the manner and at the time(s) set forth in the Notice.

                  (e)      Transfer. If all of the Offered Shares proposed in
the Notice to be Transferred to a given Proposed Transferee are not purchased by
the Company and/or its assignee(s) as provided in this Section 7, then the
Purchaser may Transfer such Offered Shares to that Proposed Transferee at the
Offered Price or at a higher price; provided that such Transfer is consummated
within 120 days after the date of the Notice, and provided further, that (i) any
such Transfer is effected in compliance with all applicable securities laws and
(ii) the Proposed Transferee agrees in writing that the provisions of this
Section 7 will continue to apply to the Offered Shares in the hands of such
Proposed Transferee. If the Offered Shares described in the Notice are not
Transferred to the Proposed Transferee within such 120 day period, then a new
Notice must be given to the Company, and the Company will again be offered the
Right of First Refusal before any Vested Shares held by the Purchaser may be
Transferred.

                  (f)      Exempt Transfers: Notwithstanding anything to the
contrary in Section 4(d) or in this Section 7, the following Transfers of
Offered Shares will be exempt from the Right of First Refusal: (i) the Transfer
of any or all of the Offered Shares during Purchaser's lifetime by gift or on
Purchaser's death by will or intestacy to any Immediate Family Member (as such
term is defined in the Plan) of Purchaser, provided that each transferee or
other recipient agrees in a writing satisfactory to the Company that the
provisions of this Section 7 will continue to apply to the Transferred Shares in
the hands of such transferee or other recipient; (ii) any Transfer of Vested
Shares made pursuant to a statutory merger or statutory consolidation of the
Company with or into another corporation or corporations (except that the Right
of First Refusal will continue to apply thereafter to such Vested Shares, in
which case the surviving corporation of such merger or consolidation shall
succeed to the rights of the Company under this Section 7 unless the agreement
of merger or consolidation expressly otherwise provides); or (iii) any Transfer
of Vested Shares pursuant to the winding up and dissolution of the Company.

                                       41

<PAGE>

                  (g)      Termination of Right of First Refusal: The Company's
Right of First Refusal will terminate on the IPO Date.

         8.       Rights as Shareholder. The Purchaser shall not be deemed to be
the holder of, or to have any of the rights of a holder with respect to, any
Shares for which such Option is exercised including, but not limited to, rights
to vote or to receive dividends unless and until the Purchaser has satisfied all
requirements for exercise of the Option pursuant to its terms, the certificates
evidencing such Shares have been issued and the Purchaser has become a record
holder of such Shares. A share certificate for the number of Vested Shares so
acquired shall be issued to the Purchaser as soon as practicable after exercise
of the Option. No adjustment will be made for a dividend or other right for
which the record date is prior to the date all the conditions set forth above
are satisfied, except as provided in Section 13 of the Plan.

         9.       Section 83(b) Election. Purchaser understands that under
Section 83 of the Internal Revenue Code of 1986, as amended (the "Code"), the
difference between the exercise price paid for any Unvested Shares and their
fair market value on the date any forfeiture restrictions applicable to such
shares lapse will be reportable as ordinary income at that time. For this
purpose, the term "forfeiture restrictions" includes the right of the Company to
repurchase the Unvested Shares pursuant to its Repurchase Option under Section 6
hereof. Purchaser understands that Purchaser may elect to be taxed at the time
the Unvested Shares are acquired hereunder to the extent the fair market value
of the Unvested Shares differs from the Exercise Price, rather than when and as
such Unvested Shares cease to be subject to such forfeiture restrictions, by
filing an election under Section 83(b) of the Code with the I.R.S. within thirty
(30) days after the date of purchase hereunder (a "Section 83(b) Election"). If
the fair market value of the Unvested Shares at the date of purchase equals the
Exercise Price paid (and thus no tax is payable), a Section 83(b) Election must
be made to avoid adverse tax consequences in the future. An example of the form
for making this Section 83(b) Election is attached as Exhibit B hereto.
Purchaser understands that failure to make this Section 83(b) Election filing
within the thirty (30) day period may result in the recognition of ordinary
income by the Purchaser as the forfeiture restrictions lapse. PURCHASER
ACKNOWLEDGES THAT IT IS PURCHASER'S SOLE RESPONSIBILITY, AND NOT THE COMPANY'S,
TO FILE A TIMELY SECTION 83(b) ELECTION, EVEN IF PURCHASER REQUESTS THAT THE
COMPANY OR ITS REPRESENTATIVES MAIL THIS FILING ON PURCHASER'S BEHALF. PURCHASER
FURTHER ACKNOWLEDGES THAT COMPANY HAS MADE NO REPRESENTATIONS REGARDING THE
APPLICATION OF SECTION 83 OF THE CODE TO THE RESTRICTED SHARES. PURCHASER IS
RELYING SOLELY ON PURCHASER'S ADVISORS WITH RESPECT TO THE APPLICABILITY OF
SECTION 83 OF THE CODE AND THE DECISION AS TO WHETHER OR NOT TO FILE A SECTION
83(b) ELECTION

         10.      Tax Consultation. Purchaser understands that Purchaser may
suffer adverse tax consequences as a result of Purchaser's purchase or
disposition of the Shares. Purchaser represents that Purchaser has consulted
with any tax consultants Purchaser deems advisable in connection with the
purchase or disposition of the Shares and that Purchaser is not relying on the
Company for any tax advice.

         11.      Legends. Purchaser understands and agrees that the Company
will cause a legend regarding the Company's Repurchase Option and Right of First
Refusal to be placed upon any certificate(s) or other documents or instruments
evidencing ownership of the Shares by the Purchaser, in addition to any other
legends required under federal and state securities laws including the following
legends:

         "THE SHARES REPRESENTED BY THIS CERTIFICATE HAVE NOT BEEN REGISTERED
         UNDER THE SECURITIES ACT OF 1933. THE SHARES MAY NOT BE SOLD OR OFFERED
         FOR SALE IN THE ABSENCE OF (I) AN EFFECTIVE REGISTRATION STATEMENT FOR
         THE SHARES UNDER SUCH ACT, (II) A `NO

                                       42

<PAGE>

         ACTION' LETTER OF THE SECURITIES AND EXCHANGE COMMISSION WITH RESPECT
         TO SUCH SALE OR OFFER, OR (III) AN OPINION OF COUNSEL SATISFACTORY TO
         THE CORPORATION THAT REGISTRATION UNDER SUCH ACT IS NOT REQUIRED WITH
         RESPECT TO SUCH SALE OR OFFER."

         "THE SHARES REPRESENTED BY THIS CERTIFICATE MAY NOT BE SOLD, ASSIGNED,
         TRANSFERRED, ENCUMBERED OR IN ANY MANNER DISPOSED OF, EXCEPT IN
         COMPLIANCE WITH THE TERMS OF WRITTEN AGREEMENTS BETWEEN THE CORPORATION
         AND THE REGISTERED HOLDER OF THE SHARES (OR THE PREDECESSOR IN INTEREST
         TO THE SHARES). SUCH AGREEMENTS GRANT CERTAIN REPURCHASE RIGHTS AND
         RIGHTS OF FIRST REFUSAL TO THE CORPORATION. THE SECRETARY OF THE
         CORPORATION WILL UPON WRITTEN REQUEST FURNISH A COPY OF SUCH AGREEMENTS
         TO THE HOLDER HEREOF WITHOUT CHARGE."

         12.      Entire Agreement. The Plan and the Option Agreement are
incorporated herein by reference. This Exercise Agreement, the Plan and the
Option Agreement constitute the entire agreement of the parties with respect to
the subject matter hereof and supersede in their entirety all prior undertakings
and agreements of the Company and Purchaser with respect to the subject matter
hereof, and this Exercise Agreement may not be amended except by means of a
writing signed by the Company and Purchaser. If any inconsistency should exist
between the terms and conditions of this Exercise Agreement and the terms of the
Option Agreement, the terms of the Option Agreement shall govern and control. If
any inconsistency should exist between the terms and conditions of this Exercise
Agreement and the terms of the Plan, the terms of the Plan shall govern and
control.

         13.      Governing Law. This Exercise Agreement is governed by Texas
law except for that body of law pertaining to conflict of laws.

Submitted by:                          Accepted by:

PURCHASER:                             THE COMPANY:

                                       ASCENDANT SOLUTIONS, INC.

                                       By:
------------------------------             ------------------------------
Signature

                                       Its:
------------------------------             ------------------------------
Print Name

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

                                       15455 North Dallas Parkway
------------------------------         Suite 500
                                       Addison, Texas 75001
------------------------------         Attn: Secretary

                                       43

<PAGE>

                                                 Exhibit A to Exercise Agreement
                                                 -------------------------------
                                                       (Immediately Exercisable)
                                                       -------------------------




                      ASSIGNMENT SEPARATE FROM CERTIFICATE



         FOR VALUE RECEIVED ____________________ hereby sells, assigns and
transfers unto [_____________________________], a [_________] corporation (the
"Company"), _________ (_______) shares of the Capital Stock of _____________
standing in _____________ name on the books of said ______________ represented
by Certificate No. _______________ herewith and does hereby irrevocably
constitute and appoint ____________________ Attorney to transfer the said stock
on the books of the within named Company with full power of substitution in the
premises.

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

                                       Signature
                                                 -------------------------------


                                       Signature
                                                 -------------------------------

                                       44

<PAGE>

                                                 Exhibit B to Exercise Agreement
                                                 -------------------------------
                                                       (Immediately Exercisable)
                                                       -------------------------




                             FORM OF 83(b) ELECTION

         This statement is being made under Section 83(b) of the Internal
Revenue Code, pursuant to Treas. Reg. Section 1.83-2.

         (1)      The person who performed the services is:

                  Name:
                  Address:
                  Taxpayer Ident.  No.:
                  Taxable Year: Calendar Year 200[__]

         (2)      The property with respect to which the election is being made
                  is _________ shares of the common stock of [___________], Inc.

         (3)      The property was transferred on [__________], 200[__].

         (4)      The property is subject to a repurchase option pursuant to
                  which the issuer has the right to acquire the property at the
                  original purchase price if for any reason [___________'s]
                  services for the issuer terminates.

         (5)      The fair market value at the time of transfer (determined
                  without regard to any restriction other than a restriction
                  which by its terms will never lapse) is $[_______] per share.

         (6)      The amount paid for such property is $[___________]per share.

         (7)      A copy of this statement was furnished to [_____________],
                  Inc. for whom the undersigned rendered the service underlying
                  the transfer of property.

         (8)      This statement is executed as of: [______________].





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

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