**Exhibit 10.2**

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**AMENDMENT NO. 1TO1998 STOCK OPTION PLAN**

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This Amendment No. 1 to the 1998 Stock OptionPlan (this “Amendment”) is executed by the undersigned, by and on behalf ofCaldera Systems, Inc., a Delaware corporation (the “Company”).

 

**Background**

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A.                                   TheCompany has adopted the Caldera Systems, Inc. 1998 Stock Option Plan (the “1998Plan”) pursuant to which the Company granted Options to employees,directors and certain consultants of the Company and its subsidiaries.  Capitalized terms used in this Amendment butnot defined herein have the meaning set forth in the 1998 Plan.

 

B.                                     TheCompany desires to amend the 1998 Plan in order to provide for additionalmechanisms for handling options upon a corporate change in control transactionand to permit exercise of options within 60 days after termination ofemployment for “cause.”

 

**Amendment**

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NOW,THEREFORE, the 1998 Plan is hereby amended as follows:

 

**1.****                                      AllowCash Out, Conversion or Other Disposition of Vested Options Upon a CorporateTransaction**

 

Article 2 II A of the 1998 Plan is amended todelete the first sentence thereof and to add the following provisions in itsstead:

 

Any vested Options outstanding at the time of aCorporate Transaction shall be cashed out, converted to options of theacquiring entity, assumed by the acquiring entity or otherwise disposed of inthe manner provided in any shareholder-approved agreement or plan governing orproviding for such Corporate Transaction (“Transaction Agreement”); providedthat any such cash-out, conversion, assumption or disposition of the Optionsshall not deprive the Option holder of the inherent value of his options,measured solely by the excess of the fair market value of the underlying optionshares immediately prior to the Corporate Transaction over the option exerciseprice, without the holder’s consent.  Inthe absence of such governing provisions in a Transaction Agreement, the PlanAdministrator in its sole discretion may on a case by case basis require anyvested, exercisable Options that remain outstanding upon a CorporateTransaction to be cashed out and terminated in exchange for a lump sum cashpayment, shares of the acquiring entity or a combination thereof equal in valueto the fair market value of the Option, measured in the manner described above,immediately prior to the Corporate Transaction. Any non-vested Options shall terminate unless:  (i) otherwise provided in theTransaction Agreement or in any other written agreement, such as a severanceagreement, between the Corporation and the Optionee; or (ii) the PlanAdministrator in its sole discretion on a case by case basis elects in writingto waive termination.

 

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**2.****                                      AllowExercise of Options Up to 120 Days After Termination of Service.**

 

Article 2 I C (i) of the 1998 Plan is amended toread as follows:

 

(i)                                     Shouldan Optionee cease to remain in Service with the Corporation for any reasonother than Cause, death or Disability then any Options granted to the Optionee,to the extent they are exercisable at the time of termination of Service, shallremain exercisable until the date which is 120 days after the date of suchtermination, on which date they shall expire.

 

**3.****                                      AllowExercise of Options Up To 30 Days After Termination For Cause.**

 

Article 2 I C (ii) of the 1998 Plan is amended toread as follows:

 

(ii)                                  Unlessan applicable option agreement issued after July 1, 2000 providesotherwise, if an Optionee’s Service with the Corporation or a Subsidiary of theCorporation is terminated for Cause, Options granted to the Optionee, to theextent they are then exercisable, shall remain exercisable for 30 daysfollowing the date of termination of Service, on which date they shallexpire.  Notwithstanding the foregoing,no Option shall be exercisable after expiration of its term.

 

**4.****                                      Increasein Number of Shares Subject to the Plan and Individual Limitation.**

 

Section IV.A of the Plan is hereby deleted in itsentirety, and the following is hereby inserted in its stead:

 

A.                                   Thestock issuable under the Plan shall be shares of authorized but unissued or re-acquiredCommon Stock.  The maximum number ofshares of Common Stock which may be issued over the term of the Plan shall notexceed 5,000,000 shares.

 

**5.****                                      Ratification**.  Except as specifically modified hereby, thePlan is hereby ratified and reaffirmed by the Company.

 

**6.****                                      Effectiveness**.  This Amendment is effective as of the datethis Amendment is approved by the Board of Directors of the Company and shallsupersede any inconsistent statement contained in an Option agreement issuedprior to the date hereof.

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The undersigned, who is the duly elected Secretary ofthe Company, hereby certifies that the Board of Directors of the Companyapproved this Amendment on July 14, 2000, at which time this Amendmentbecame effective.

 
|   | Caldera Systems,  Inc., a Delaware corporation |
|--------|------------------------------------------------|
|   |                                           |   |
|   |                                           |   |
|   | By:                                            | /s/ RICHARD C. RIFE |   |
|   |                                           | Richard C. Rife, its Corporate Secretary |

 

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