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                                                                     Exhibit 4.1



                                DOCUMENTUM, INC.

                           1996 EQUITY INCENTIVE PLAN

                      ADOPTED BY BOARD ON OCTOBER 16, 1996

                                  AS AMENDED ON
                                  MARCH 6, 1997
                                DECEMBER 17,1997
                                 JANUARY 7, 1998
                                FEBRUARY 5, 1998
                                  JULY 10, 1998
                                 AUGUST 6, 1998
                                FEBRUARY 3, 1999
                                 APRIL 14, 1999
                                FEBRUARY 9, 2000
                                 OCTOBER 2, 2000
                                FEBRUARY 14, 2001
                               SEPTEMBER 14, 2001
                                FEBRUARY 1, 2002

                        STOCKHOLDER APPROVAL NOT REQUIRED

1.    PURPOSES.

      (A) The purpose of the 1996 Equity Incentive (the "PLAN") is to provide a
means by which selected Employees and Directors of and Consultants to the
Company and its Affiliates may be given an opportunity to benefit from increases
in value of the stock of the Company through the granting of (i) Nonstatutory
Stock Options, (ii) stock bonuses, and (iii) rights to purchase restricted
stock, all as defined below.

      (B) The Company, by means of the Plan, seeks to retain the services of
persons who are now Employees and Directors of or Consultants to the Company or
its Affiliates, to secure and retain the services of new Employees, Directors
and Consultants, and to provide incentives for such persons to exert maximum
efforts for the success of the Company and its Affiliates.

      (C) The Company intends that the Stock Awards issued under the Plan shall,
in the discretion of the Board or any Committee to which responsibility for
administration of the Plan has been delegated pursuant to subsection 3(c), be
either (i) Nonstatutory Stock Options granted pursuant to Section 6 hereof, or
(ii) stock bonuses or rights to purchase restricted stock granted pursuant to
Section 7 hereof.

2.    DEFINITIONS.

      (A) "AFFILIATE" means any parent corporation or subsidiary corporation,
whether now or hereafter existing, as those terms are defined in Sections 424(e)
and (f), respectively, of the Code.

                                       1.
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      (B) "BOARD" means the Board of Directors of the Company.

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

      (D) "COMMITTEE" means a committee or subcommittee appointed by the Board
in accordance with subsection 3(c) of the Plan.

      (E) "COMPANY" means Documentum, Inc., a Delaware corporation.

      (F) "CONSULTANT" means any person, including an advisor, engaged by the
Company or an Affiliate to render consulting services and who is compensated for
such services, provided that the term "CONSULTANT" shall not include those
persons who render services as a Director.

      (G) "CONTINUOUS STATUS AS AN EMPLOYEE, DIRECTOR OR CONSULTANT" means that
the service of an individual to the Company, whether as an Employee, Director or
Consultant, is not interrupted or terminated. The Board, in its sole discretion,
may determine whether Continuous Status as an Employee, Director or Consultant
shall be considered interrupted in the case of: (i) any leave of absence
approved by the Board, including sick leave, military leave, or any other
personal leave; or (ii) transfers between locations of the Company or between
the Company, Affiliates or their successors.

      (H) "DIRECTOR" means a member of the Board.

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

      (J) "EMPLOYEE" means any person employed by the Company or any Affiliate
of the Company. Neither service as a Director nor payment of a director's fee by
the Company shall be sufficient to constitute "employment" by the Company.

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

      (L) "FAIR MARKET VALUE" means, as of any date, the value of the common
stock of the Company, determined as follows:

         (I) If the common stock is listed on any established stock exchange or
traded on the Nasdaq National Market or the Nasdaq SmallCap Market, the Fair
Market Value of a share of common stock shall be the closing sales price for
such stock (or the closing bid, if no sales were reported) as quoted on such
exchange or market (or the exchange or market with the greatest volume of
trading in the Company's common stock) on the date of determination, and if the
date of determination was not a market trading day, then on the last market
trading day prior to the date of determination, as reported in The Wall Street
Journal or such other source as the Board deems reliable.

         (II) In the absence of such markets for the common stock, the Fair
Market Value shall be determined in good faith by the Board.

                                       2.
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      (M) "NON-EMPLOYEE DIRECTOR" means a Director who either (i) is not a
current Employee or Officer of the Company or its parent or subsidiary, does not
receive compensation (directly or indirectly) from the Company or its parent or
subsidiary for services rendered as a consultant or in any capacity other than
as a Director (except for an amount as to which disclosure would not be required
under Item 404(a) of Regulation S-K promulgated pursuant to the Securities Act
("Regulation S-K")), does not possess an interest in any other transaction as to
which disclosure would be required under Item 404(a) of Regulation S-K, and is
not engaged in a business relationship as to which disclosure would be required
under Item 404(b) of Regulation S-K; or (ii) is otherwise considered a
"non-employee director" for purposes of Rule 16b-3.

      (N) "NONSTATUTORY STOCK OPTION" means an Option not intended to qualify as
an incentive stock option pursuant to Section 422 of the Code and the
regulations promulgated thereunder.

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

      (P) "OPTION" means a stock option granted pursuant to the Plan.

      (Q) "OPTION AGREEMENT" means a written agreement between the Company and
an Optionee evidencing the terms and conditions of an individual Option grant.
Each Option Agreement shall be subject to the terms and conditions of the Plan.

      (R) "OPTIONEE" means an Employee, Director or Consultant who holds an
outstanding Option.

      (S) "PLAN" means this 1996 Equity Incentive Plan.

      (T) "RULE 16B-3" means Rule 16b-3 of the Exchange Act or any successor to
Rule 16b-3, as in effect with respect to the Company at the time discretion is
being exercised regarding the Plan.

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

      (V) "STOCK AWARD" means any right granted under the Plan, including any
Option, any stock bonus and any right to purchase restricted stock.

      (W) "STOCK AWARD AGREEMENT" means a written agreement between the Company
and a holder of a Stock Award evidencing the terms and conditions of an
individual Stock Award grant. Each Stock Award Agreement shall be subject to the
terms and conditions of the Plan.

3.    ADMINISTRATION.

      (A) The Plan shall be administered by the Board unless and until the Board
delegates administration to a Committee, as provided in subsection 3(c).

      (B) The Board shall have the power, subject to, and within the limitations
of, the express provisions of the Plan:

                                       3.
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         (I) To determine from time to time which of the persons eligible under
the Plan shall be granted Stock Awards; when and how each Stock Award shall be
granted; whether a Stock Award will be a Nonstatutory Stock Option, a stock
bonus, a right to purchase restricted stock, or a combination of the foregoing;
the provisions of each Stock Award granted (which need not be identical),
including the time or times when a person shall be permitted to receive stock
pursuant to a Stock Award; and the number of shares with respect to which a
Stock Award shall be granted to each such person.

         (II) To construe and interpret the Plan and Stock Awards granted under
it, and to establish, amend and revoke rules and regulations for its
administration. The Board, in the exercise of this power, may correct any
defect, omission or inconsistency in the Plan or in any Stock Award Agreement,
in a manner and to the extent it shall deem necessary or expedient to make the
Plan fully effective.

         (III) To amend the Plan or a Stock Award as provided in Section 12.

         (IV) Generally, to exercise such powers and to perform such acts as the
Board deems necessary or expedient to promote the best interests of the Company
which are not in conflict with the provisions of the Plan.

      (C) The Board may delegate administration of the Plan to a committee of
the Board composed of two (2) or more members (the "COMMITTEE"), all of the
members of which Committee may be, in the discretion of the Board, Non-Employee
Directors. If administration is delegated to a Committee, the Committee shall
have, in connection with the administration of the Plan, the powers theretofore
possessed by the Board, including the power to delegate to a subcommittee any of
the administrative powers the Committee is authorized to exercise (and
references in this Plan to the Board shall thereafter be to the Committee or
such a subcommittee), subject, however, to such resolutions, not inconsistent
with the provisions of the Plan, as may be adopted from time to time by the
Board. The Board may abolish the Committee at any time and revest in the Board
the administration of the Plan. In addition, notwithstanding anything in this
Section 3 to the contrary, the Board or the Committee may delegate to a
subcommittee of one or more members of the Board the authority to grant Stock
Awards to eligible persons who are not then subject to Section 16 of the
Exchange Act.

4.    SHARES SUBJECT TO THE PLAN.

      (A) Subject to the provisions of Section 11 relating to adjustments upon
changes in stock, the number of shares of stock that may be issued pursuant to
Stock Awards shall not exceed in the aggregate fourteen million six hundred
fifty-four thousand (19,654,000) shares of the Company's common stock. If any
Stock Award shall for any reason expire or otherwise terminate, in whole or in
part, without having been exercised in full, the stock not acquired under such
Stock Award shall revert to and again become available for issuance under the
Plan.

      (B) The stock subject to the Plan may be unissued shares or reacquired
shares, bought on the market or otherwise.

                                       4.
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5.    ELIGIBILITY.

      (A) Subject to Section 5(b) below, Stock Awards may be granted only to
Employees, Directors or Consultants, including persons not previously employed
by the Company as an inducement essential to those persons entering into
employment contracts with the Company, including persons who are ultimately
employed by the Company as Officers.

      (B) The aggregate number of shares issued pursuant to Stock Awards granted
to Officers and Directors shall be less than fifty percent (50%) of the number
of shares underlying Stock Awards granted to all persons under the Plan, as
determined (i) from the date of the amendment of the Plan to extend eligibility
to Officers and Directors to the date of the third anniversary of such
amendment, and (ii) on an annual basis for each year following such third
anniversary; provided, however, that there shall be excluded from both the
numerator and denominator of such calculation shares issued to Officers not
previously employed by the Company pursuant to Stock Awards granted as an
inducement essential to such individuals entering into employment contracts with
the Company.

      (C) A Consultant shall not be eligible for the grant of a Stock Award if,
at the time of grant, a Form S-8 Registration Statement under the Securities Act
("Form S-8") is not available to register either the offer or the sale of the
Company's securities to such Consultant because of the nature of the services
that the Consultant is providing to the Company, or because the Consultant is
not a natural person, or as otherwise provided by the rules governing the use of
Form S-8, unless the Company determines both (i) that such grant (A) shall be
registered in another manner under the Securities Act (e.g., on a Form S-3
Registration Statement) or (B) does not require registration under the
Securities Act in order to comply with the requirements of the Securities Act,
if applicable, and (ii) that such grant complies with the securities laws of all
other relevant jurisdictions.

6.    OPTION PROVISIONS.

      Each Option shall be in such form and shall contain such terms and
conditions as the Board shall deem appropriate. The provisions of separate
Options need not be identical, but each Option shall include (through
incorporation of provisions hereof by reference in the Option or otherwise) the
substance of each of the following provisions:

      (A) TERM. No Option shall be exercisable after the expiration of ten (10)
years from the date it was granted.

      (B) PRICE. The exercise price of each Nonstatutory Stock Option shall be
not less than eighty-five percent (85%) of the Fair Market Value of the stock
subject to the Option on the date the Option is granted.

      (C) CONSIDERATION. The purchase price of stock acquired pursuant to an
Option shall be paid, to the extent permitted by applicable statutes and
regulations, either (i) in cash at the time the Option is exercised, or (ii) at
the discretion of the Board or the Committee, at the time of the grant of the
Option, (A) by delivery to the Company of other common stock of the Company, (B)
according to a deferred payment arrangement, except that payment of the common
stock's "par value" (as defined in the Delaware General Corporation Law) shall
not be made by deferred


                                       5.
<PAGE>

payment or other arrangement (which may include, without limiting the generality
of the foregoing, the use of other common stock of the Company) with the person
to whom the Option is granted or to whom the Option is transferred pursuant to
subsection 6(d), or (C) in any other form of legal consideration that may be
acceptable to the Board. Unless otherwise specifically provided in the Option,
the purchase price of common stock of the Company acquired pursuant to an Option
that is paid by delivery to the Company of other Company common stock acquired
directly or indirectly from the Company shall be paid only by shares of common
stock of the Company that have been held for more than six (6) months (or such
longer or shorter period of time required to avoid a charge to earnings for
financial accounting purposes).

         In the case of any deferred payment arrangement, interest shall be
compounded at least annually and shall be charged at the minimum rate of
interest necessary to avoid (1) the treatment as interest, under any applicable
provisions of the Code, of any amounts other than amounts stated to be interest
under the deferred payment arrangement and (2) the treatment of the Option as a
variable award for financial accounting purposes.

      (D) TRANSFERABILITY. An 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 person to whom the Option is granted only by such person) unless
the applicable Option Agreement expressly provides for other transferability.
Notwithstanding the foregoing, the person to whom the Option is granted may, by
delivering written notice to the Company, in a form satisfactory to the Company,
designate a third party who, in the event of the death of the Optionee, shall
thereafter be entitled to exercise the Option.

      (E) VESTING. The total number of shares of stock 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 ("vest") 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. The Option may be subject to such other terms and conditions on the
time or times when it may be exercised (which may be based on performance or
other criteria) as the Board may deem appropriate. The vesting provisions of
individual Options may vary. The provisions of this subsection 6(e) are subject
to any Option provisions governing the minimum number of shares as to which an
Option may be exercised.

      (F) TERMINATION OF SERVICE RELATIONSHIP. In the event an Optionee's
Continuous Status as an Employee, Director or Consultant terminates (other than
upon the Optionee's death or disability), the Optionee may exercise his or her
Option (to the extent that the Optionee was entitled to exercise it as of the
date of termination) but only within such period of time ending on the earlier
of (i) the date three (3) months following the termination of the Optionee's
Continuous Status as an Employee, Director or Consultant (or such longer or
shorter period specified in the Option Agreement), or (ii) the expiration of the
term of the Option as set forth in the Option Agreement. If, at the date of
termination, the Optionee is not entitled to exercise his or her entire Option,
the shares covered by the unexercisable portion of the Option shall revert to
the Plan. If, after termination, the Optionee does not exercise his or her
Option within the time


                                       6.
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specified in the Option Agreement, the Option shall terminate, and the shares
covered by such Option shall revert to and again become available for issuance
under the Plan.

          An Optionee's Option Agreement may also provide that if the exercise
of the Option following the termination of the Optionee's Continuous Status as
an Employee, Director or Consultant (other than upon the Optionee's death or
disability) would result in liability under Section 16(b) of the Exchange Act,
then the Option shall terminate on the earlier of (i) the expiration of the term
of the Option set forth in the Option Agreement, or (ii) the tenth (10th) day
after the last date on which such exercise would result in such liability under
Section 16(b) of the Exchange Act. Finally, an Optionee's Option Agreement may
also provide that if the exercise of the Option following the termination of the
Optionee's Continuous Status as an Employee, Director or Consultant (other than
upon the Optionee's death or disability) would be prohibited at any time solely
because the issuance of shares would violate the registration requirements under
the Act, then the Option shall terminate on the earlier of (i) the expiration of
the term of the Option set forth in the first paragraph of this subsection 6(f),
or (ii) the expiration of a period of three (3) months after the termination of
the Optionee's Continuous Status as an Employee, Director or Consultant during
which the exercise of the Option would not be in violation of such registration
requirements.

      (G) DISABILITY OF OPTIONEE. In the event an Optionee's Continuous Status
as an Employee, Director or Consultant terminates as a result of the Optionee's
Disability, the Optionee may exercise his or her Option (to the extent that the
Optionee was entitled to exercise it as of the date of termination), but only
within such period of time ending on the earlier of (i) the date six (6) months
following such termination (or such longer or shorter period specified in the
Option Agreement), or (ii) the expiration of the term of the Option as set forth
in the Option Agreement. If, at the date of termination, the Optionee is not
entitled to exercise his or her entire Option, the shares covered by the
unexercisable portion of the Option shall revert to and again become available
for issuance under the Plan. If, after termination, the Optionee does not
exercise his or her Option within the time specified herein, the Option shall
terminate, and the shares covered by such Option shall revert to and again
become available for issuance under the Plan.

      (H) DEATH OF OPTIONEE. In the event of the death of an Optionee during, or
within a period specified in the Option Agreement after the termination of, the
Optionee's Continuous Status as an Employee, Director or Consultant, the Option
may be exercised (to the extent the Optionee was entitled to exercise the Option
as of the date of death) by the Optionee's estate, by a person who acquired the
right to exercise the Option by bequest or inheritance, but only within the
period ending on the earlier of (i) the date twelve (12) months following the
date of death (or such longer or shorter period specified in the Option
Agreement), or (ii) the expiration of the term of such Option as set forth in
the Option Agreement. If, at the time of death, the Optionee was not entitled to
exercise his or her entire Option, the shares covered by the unexercisable
portion of the Option shall revert to and again become available for issuance
under the Plan. If, after death, the Option is not exercised within the time
specified herein, the Option shall terminate, and the shares covered by such
Option shall revert to and again become available for issuance under the Plan.

                                       7.
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7.    TERMS OF STOCK BONUSES AND PURCHASES OF RESTRICTED STOCK.

      Each stock bonus or restricted stock purchase agreement shall be in such
form and shall contain such terms and conditions as the Board or the Committee
shall deem appropriate. The terms and conditions of stock bonus or restricted
stock purchase agreements may change from time to time, and the terms and
conditions of separate agreements need not be identical, but each stock bonus or
restricted stock purchase agreement shall include (through incorporation of
provisions hereof by reference in the agreement or otherwise) the substance of
each of the following provisions as appropriate:

      (A) PURCHASE PRICE. The purchase price under each restricted stock
purchase agreement shall be such amount as the Board or Committee shall
determine and designate in such agreement, but in no event shall the purchase
price be less than eighty-five percent (85%) of the stock's Fair Market Value on
the date such award is made. Notwithstanding the foregoing, the Board or the
Committee may determine that eligible participants in the Plan may be awarded
stock pursuant to a stock bonus agreement in consideration for past services
actually rendered to the Company or for its benefit.

      (B) TRANSFERABILITY. No rights under a stock bonus or restricted stock
purchase agreement shall be transferable except by will or the laws of descent
and distribution, unless the applicable Stock Award Agreement expressly provides
for other transferability.

      (C) CONSIDERATION. The purchase price of stock acquired pursuant to a
stock purchase agreement shall be paid either: (i) in cash at the time of
purchase; (ii) at the discretion of the Board or the Committee, according to a
deferred payment or other arrangement, except that payment of the common stock's
"par value" (as defined in the Delaware General Corporation Law) shall not be
made by deferred payment or other arrangement (which may include, without
limiting the generality of the foregoing, the use of other common stock of the
Company) with the person to whom the stock is sold; or (iii) in any other form
of legal consideration that may be acceptable to the Board or the Committee in
its discretion. Notwithstanding the foregoing, the Board or the Committee to
which administration of the Plan has been delegated may award stock pursuant to
a stock bonus agreement in consideration for past services actually rendered to
the Company or for its benefit.

      (D) VESTING. Shares of stock sold or awarded under the Plan may, but need
not, be subject to a repurchase option in favor of the Company in accordance
with a vesting schedule to be determined by the Board or the Committee.

      (E) TERMINATION OF SERVICE RELATIONSHIP. In the event a Participant's
Continuous Status as an Employee, Director or Consultant terminates, the Company
may repurchase or otherwise reacquire, subject to the limitations described in
subsection 7(d), any or all of the shares of stock held by that person which
have not vested as of the date of termination under the terms of the stock bonus
or restricted stock purchase agreement between the Company and such person.

                                       8.
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8.    COVENANTS OF THE COMPANY.

      (A) During the terms of the Stock Awards, the Company shall keep available
at all times the number of shares of stock required to satisfy such Stock
Awards.

      (B) The Company shall seek to obtain from each regulatory commission or
agency having jurisdiction over the Plan such authority as may be required to
issue and sell shares of stock upon exercise of the Stock Award; provided,
however, that this undertaking shall not require the Company to register under
the Securities Act either the Plan, any Stock Award or any stock issued or
issuable pursuant to any such Stock Award. If, after reasonable efforts, the
Company is unable to obtain from any such regulatory commission or agency the
authority which counsel for the Company deems necessary for the lawful issuance
and sale of stock under the Plan, the Company shall be relieved from any
liability for failure to issue and sell stock upon exercise of such Stock Awards
unless and until such authority is obtained.

9.    USE OF PROCEEDS FROM STOCK.

      Proceeds from the sale of stock pursuant to Stock Awards shall constitute
general funds of the Company.

10.   MISCELLANEOUS.

      (A) The Board shall have the power to accelerate the time at which a Stock
Award may first be exercised or the time during which a Stock Award or any part
thereof will vest pursuant to subsection 6(e) or 7(d), notwithstanding the
provisions in the Stock Award stating the time at which it may first be
exercised or the time during which it will vest.

      (B) Neither an Employee, Director or Consultant, nor any person to whom a
Stock Award is transferred under subsection 6(d) or 7(b) shall be deemed to be
the holder of, or to have any of the rights of a holder with respect to, any
shares subject to such Stock Award unless and until such person has satisfied
all requirements for exercise of the Stock Award pursuant to its terms.

      (C) Nothing in the Plan or any instrument executed or Stock Award granted
pursuant thereto shall confer upon any Employee, Director, Consultant or other
holder of Stock Awards any right to continue in the employ of the Company or any
Affiliate (or to continue acting as a Director or Consultant) or shall affect
the right of the Company or any Affiliate to terminate the employment of any
Employee with or without cause, to terminate the services of a Director, or to
terminate the relationship of any Consultant in accordance with the terms of
that Consultant's agreement with the Company or Affiliate to which such
Consultant is providing services.

      (D) SECURITIES LAW COMPLIANCE. The Company may require any person to whom
a Stock Award is granted, or any person to whom a Stock Award is transferred
pursuant to subsection 6(d) or 7(b), as a condition of exercising or acquiring
stock under any Stock Award, (1) to give written assurances satisfactory to the
Company as to such person'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


                                       9.
<PAGE>
representative, the merits and risks of exercising the Stock Award; and (2) to
give written assurances satisfactory to the Company stating that such person is
acquiring the stock subject to the Stock Award for such person's own account and
not with any present intention of selling or otherwise distributing the stock.
The foregoing requirements, and any assurances given pursuant to such
requirements, shall be inoperative if (i) the issuance of the shares upon the
exercise or acquisition of stock under the Stock Award has been registered under
a then currently effective registration statement under the Securities Act, 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. The Company may require the holder of the Stock
Award to provide such other representations, written assurances or information
which the Company shall determine is necessary, desirable or appropriate to
comply with applicable securities and other laws as a condition of granting a
Stock Award to such person or permitting the holder of the Stock Award to
exercise the Stock Award. 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 applicable
securities laws, including, but not limited to, legends restricting the transfer
of the stock.

      (E) WITHHOLDING. To the extent provided by the terms of a Stock Award
Agreement, the person to whom a Stock Award is granted may satisfy any federal,
state or local tax withholding obligation relating to the exercise or
acquisition of stock under a Stock Award by any of the following means or by a
combination of such means: (1) tendering a cash payment; (2) authorizing the
Company to withhold shares from the shares of the common stock otherwise
issuable to the participant as a result of the exercise or acquisition of stock
under the Stock Award; or (3) delivering to the Company owned and unencumbered
shares of the common stock of the Company. Notwithstanding the foregoing, the
Company shall not be authorized to withhold shares of Common Stock at rates in
excess of the minimum statutory withholding rates for federal and state tax
purposes, including payroll taxes.

11.   ADJUSTMENTS UPON CHANGES IN STOCK.

      (A) If any change is made in the stock subject to the Plan, or subject to
any Stock Award, without the receipt of consideration by the Company (through
merger, consolidation, reorganization, recapitalization, reincorporation, stock
dividend, dividend in property other than cash, stock split, liquidating
dividend, combination of shares, exchange of shares, change in corporate
structure or other transaction not involving the receipt of consideration by the
Company), the Plan will be appropriately adjusted in the class(es) and the
maximum number of shares subject to the Plan pursuant to subsection 4(a), and
the outstanding Stock Awards will be appropriately adjusted in the class(es) and
number of shares and price per share of stock subject to such outstanding Stock
Awards. Such adjustments shall be made by the Board or the Committee, the
determination of which shall be final, binding and conclusive. (The conversion
of any convertible securities of the Company shall not be treated as a
"transaction not involving the receipt of consideration by the Company.")

      (B) In the event of: (1) a dissolution, liquidation or sale of all or
substantially all of the assets of the Company; (2) a merger or consolidation in
which the Company is not the surviving corporation; (3) a reverse merger in
which the Company is the surviving corporation but the shares of the Company's
common stock outstanding immediately preceding the merger


                                      10.
<PAGE>
are converted by virtue of the merger into other property, whether in the form
of securities, cash or otherwise, then to the extent permitted by applicable
law: (i) any surviving corporation or an Affiliate of such surviving corporation
shall assume any Stock Awards outstanding under the Plan or shall substitute
similar Stock Awards for those outstanding under the Plan, or (ii) such Stock
Awards shall continue in full force and effect. In the event any surviving
corporation and its Affiliates refuse to assume or continue such Stock Awards,
or to substitute similar Stock Awards for those outstanding under the Plan,
then, with respect to Stock Awards held by persons then performing services as
Employees, Directors or Consultants, the time during which such Stock Awards may
be exercised shall be accelerated and the Stock Awards terminated if not
exercised prior to such event.

12.   AMENDMENT OF THE PLAN AND STOCK AWARDS.

      (A) The Board at any time, and from time to time, may amend the Plan.

      (B) The Board, in its sole discretion, may submit the Plan and/or any
amendment to the Plan for stockholder approval to the extent stockholder
approval is necessary for the Plan to satisfy the requirements of Rule 16b-3 of
the Exchange Act or any Nasdaq or securities exchange listing requirements.

      (C) It is expressly contemplated that the Board may amend the Plan in any
respect the Board deems necessary or advisable to provide those eligible with
the maximum benefits provided or to be provided under the provisions of the Code
and the regulations promulgated thereunder.

      (D) Rights and obligations under any Stock Award granted before amendment
of the Plan shall not be impaired by any amendment of the Plan unless (i) the
Company requests the consent of the person to whom the Stock Award was granted
and (ii) such person consents in writing.

      (E) The Board at any time, and from time to time, may amend the terms of
any one or more Stock Award; provided, however, that the rights and obligations
under any Stock Award shall not be impaired by any such amendment unless (i) the
Company requests the consent of the person to whom the Stock Award was granted
and (ii) such person consents in writing.

13.   TERMINATION OR SUSPENSION OF THE PLAN.

      (A) The Board may suspend or terminate the Plan at any time. Unless sooner
terminated, the Plan shall terminate on October 15, 2016. No Stock Awards may be
granted under the Plan while the Plan is suspended or after it is terminated.

      (B) Rights and obligations under any Stock Award granted while the Plan is
in effect shall not be impaired by suspension or termination of the Plan, except
with the written consent of the person to whom the Stock Award was granted.

14.   EFFECTIVE DATE OF PLAN.

      The Plan shall become effective on October 16, 1996.

                                      11.