Document:

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                                                                   Exhibit 10.40

                                INTERLIANT, INC.

                          EMPLOYEE STOCK PURCHASE PLAN

                                   ARTICLE I

                            PURPOSE AND COMMENCEMENT

       1.01 Purpose. The purpose of the Plan is to provide the employees of
Interliant, Inc., a Delaware corporation (the "Company") and its Subsidiaries
with added incentive to continue in their employment and to encourage increased
efforts to promote the best interests of the Company by permitting eligible
employees to purchase shares of Common Stock of the Company at prices less than
the current market price thereof. The Plan is intended to qualify as an employee
stock purchase plan under Section 423 of the Code and shall be interpreted and
construed in accordance with such purpose.

       1.02 Commencement . The Plan shall become effective on such date as may
be specified by the Board of Directors, which, absent a resolution of the Board
of Directors to the contrary, shall be as set forth in Section 2.01(q) hereof;
provided, however, that, in no event, shall the Plan become effective unless
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within twelve months of the date of its adoption by the Board of Directors it
has been approved by the affirmative vote of a majority of the issued and
outstanding shares of the Company's securities entitled to vote on such matters
at a duly called meeting of the shareholders of the Company.

                                   ARTICLE II

                                   DEFINITIONS

       2.01 Definitions. As used in the Plan, the following terms and phrases
shall have the following meanings:

       (a) "Board of Directors" shall mean the Board of Directors of the
Company.

       (b) "Closing Market Price" with respect to any day shall mean (i) the
sales price of the Common Stock as reported on the Nasdaq National Market as of
4:00 P.M. New York Time, on such day, or (ii) if the foregoing provision is
inapplicable, the Closing Market Price shall be determined by the Committee in
good faith on such basis as it deems appropriate.

       (c) "Code" shall mean the Internal Revenue Code as of 1986, as amended.
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       (d) "Commencement Date" shall mean the first day of a Purchase Period.

       (e) "Committee" shall mean the Compensation Committee of the Board of
Directors, or such other committee of the Board of Directors designated by it
for purposes of administering the Plan.

       (f) "Common Stock" means the common stock of the Company, par value $.01
per share.

       (g) "Company" shall mean Interliant, Inc., a Delaware corporation.

       (h) "Contribution Account" shall mean the account established on behalf
of a Participant pursuant to Article III hereof to which shall be credited his
or her Participant Contributions.

       (i) "Contribution Rate" shall be a percentage of a Participant's Covered
Compensation during each payroll period designated by each Participant to be
contributed by regular payroll deductions to his or her Contribution Account as
set forth in Section 3.03 hereof.

       (j) "Covered Compensation" shall mean the total cash compensation
received by an Employee from a Sponsoring Employer, before tax withholdings and
other deductions, including base compensation, overtime, shift or other
compensatory premiums, payments in substitution of base compensation such as
vacation, holiday and sick pay, and including all cash bonus compensation, but
not including short or long-term disability payments.

       (k) "Employee" shall mean each employee of a Sponsoring Employer whose
customary employment is at least twenty (20) hours a week and more than five
months in a calendar year; provided, however, that an employee of a Sponsoring
                           --------  -------
Employer who is employed in a foreign jurisdiction shall not be deemed an
Employee if participation by such employee in the Plan is prohibited pursuant to
the laws of such jurisdiction. For purposes of the Plan, "employment" shall be
determined in accordance with the provisions of Section 1.421-7(h) of the
Treasury Regulations (or any successor regulations).

       (l) "Participant" shall mean any Employee of a Sponsoring Employer who
has met the conditions and provisions for becoming a Participant set forth in
Article III hereof.

       (m) "Participant Contributions" shall be the aggregate dollars actually
contributed by each Participant to his or her Contribution Account.

       (n) "Permanent Disability" shall mean an illness, injury or other
physical or mental condition continuing for at least 180 consecutive days which
results in

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an Employee's inability to provide in all material respects the duties
theretofore performed in his or her capacity as an Employee of a Sponsoring
Employer.

       (o) "Plan" shall mean the Interliant, Inc. Employee Stock Purchase Plan
as set forth herein, as it may be amended from time to time.

       (p) "Purchase Date" shall mean the last business day of a Purchase Period
on which the Common Stock publicly trades.

       (q) "Purchase Period" shall mean each of the six-month periods commencing
January 1 and July 1 of each calendar year during which the Plan is in effect.
The first Purchase Period shall commence on July 1, 2000.

       (r) "Purchase Price" shall mean the purchase price for a share of Common
Stock to be paid by a Participant on a Purchase Date, as determined under
Section 4.02 hereof.

       (s) "Request for Participation" shall mean such form as shall be approved
by the Committee for distribution to Employees in connection with participation
in the Plan.

       (t) "Sponsoring Employers" shall mean the Company and each Subsidiary
that has been designated by the Committee as a Sponsoring Employer under the
Plan.

       (u) "Subsidiary" shall mean a subsidiary of the Company which is treated
as a subsidiary corporation under Section 424(f) of the Code.

                                  ARTICLE III

                         ELIGIBILITY AND PARTICIPATION

       3.01 Eligibility. Each Employee who shall be employed by a Sponsoring
Employer on a given Commencement Date of a Purchase Period shall be eligible to
participate in the Plan for such Purchase Period, subject to the satisfaction of
any election requirements described in Section 3.03(a) herein.

       3.02 Limitations. Notwithstanding anything to the contrary contained in
the Plan, no right to purchase Common Stock shall accrue under the Plan in favor
of any person who is not an Employee eligible to participate in the Plan under
Section 3.01 hereof, and no Employee shall acquire the right to purchase shares
of Common Stock if (i) immediately after receiving such right to purchase Common
Stock, such Employee would own 5% or more of the total combined voting power or
value of all classes of stock of the Company or any Subsidiary, taking into
account in determining stock ownership any stock attributable to such Employee
under Section 424(d) of the Code, or (ii) which would permit such Employee's
right to purchase stock under all employee

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stock purchase plans (to which Section 423 of the Code applies) of the Company
and its Subsidiaries, as those plans are in effect from time to time, to accrue
at a rate which exceeds $25,000 of fair market value of such stock (as
determined as each Commencement Date) for each calendar year, all as specified
in the manner provided by Section 423(b)(8) of the Code, or (iii) which would
permit such Employee the right to purchase more than 1,250 shares (or such other
number as may be determined in advance for any Purchase Period by the Committee)
of Common Stock in any Purchase Period.

       3.03 Participation

       (a) Each Employee eligible to be a Participant and participate in the
Plan shall be furnished a summary of the Plan and a Request for Participation by
such Employee's Sponsoring Employer. If an Employee elects to participate
hereunder, such Employee shall complete such form and file it with his or her
Sponsoring Employer not later than 15 days prior to a Commencement Date of a
Purchase Period. The completed Request for Participation shall indicate the
Participant Contribution Rate authorized by the Participant. If any Employee
does not elect to participate in the Plan during any given Purchase Period, such
Employee may elect to participate on any future Commencement Date so long as he
or she continues to be an eligible Employee.

       (b) On his or her Request for Participation, an Employee must authorize
his or her Sponsoring Employer to deduct through a payroll deduction the amount
of such Employee's Participant Contribution. The payroll deduction specified in
a Request for Participation for each payroll period shall be at a Participant
Contribution Rate no less than 1% and no more than 15% of such Employee's
Covered Compensation during such payroll period paid to him or her by his or her
Sponsoring Employer. Such deductions shall begin as of the first pay period
occurring after the Commencement Date of a Purchase Period. Participant
Contributions will not be permitted to begin at any time other than on the first
payroll date occurring immediately after the Commencement Date of a Purchase
Period. No interest shall accrue to Participants on any amounts withheld under
the Plan, unless and until the Committee shall approve such accrual of interest
on terms that it shall specify and apply on a uniform basis as to all
Participants.

       (c) The Participant's Contribution Rate, once established, shall remain
in effect for all Purchase Periods unless changed by the Participant in writing
delivered to such Participant's Sponsoring Employer and filed with such
Sponsoring Employer at least 15 days prior to the Commencement Date of the next
Purchase Period. A Participant's Contribution Rate for a Purchase Period may not
be increased, decreased or otherwise modified at any time during the 15-day
period prior to the Commencement Date of such Purchase Period.

       (d) A Participant may notify his or her Sponsoring Employer of such
Participant's desire to discontinue his or her Participant Contributions by
delivering to his or her Sponsoring Employer written notice on such forms as may
be provided by the Company or such Participant's Sponsoring Employer at least 15
days prior to the

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Purchase Date of the relevant Purchase Period. Upon such request, there shall be
promptly refunded to such Participant as soon as practicable the entire cash
balance in his or her Contribution Account. If a Participant determines to
discontinue his or her Participant Contributions pursuant to this Section
3.03(d), (i) such Participant shall be terminated from the Plan effective upon
the date of receipt of such Participant's notice to his or her Sponsoring
Employer and (ii) such Participant shall not be permitted to resume
participation in the Plan at the beginning of the succeeding Purchase Period
unless such Participant delivers to the Company a new Request for Participation
in accordance with Section 3.03(a) hereof. In the event that a Participant's
payroll deductions are prevented by legal process, the Participant will be
deemed to have terminated from the Plan.

       (e) By enrolling in the Plan, each Participant will be deemed to have
authorized the establishment of a brokerage account in his or her name at a
securities brokerage firm or other financial institution, if approved by the
Committee in its discretion.

       3.04 Termination of Employment. Any Participant (i) whose employment by
a Sponsoring Employer is terminated for any reason (except death, retirement or
Permanent Disability) or (ii) who shall cease to be an Employee under the Plan,
in either case during a Purchase Period, shall cease being a Participant as of
the date of such termination of employment. Upon such termination of employment,
there shall be refunded to such Participant as soon as practicable the entire
cash balance in such Participant's Contribution Account. Section 4.03(b) hereof
shall apply to the issuance of certificates to a Participant following
termination of employment.

       3.05 Death, Retirement or Permanent Disability.

       (a) If a Participant shall die during a Purchase Period, no further
Participant Contributions on behalf of the deceased Participant shall be made.
The executor or administrator of the deceased Participant's estate may elect to
withdraw the balance in said Participant's Contribution Account by notifying the
deceased Participant's Sponsoring Employer in writing at least 15 days prior to
the Purchase Date in respect of such Purchase Period. In the event no election
to withdraw has been made, the balance accumulated in the deceased Participant's
Contribution Account shall be used to purchase shares of Common Stock in
accordance with Article IV hereof.

       (b) If, during a Purchase Period, a Participant shall (i) retire or (ii)
incur a Permanent Disability, no further contributions on behalf of the retired
or disabled Participant shall be made. A retired or disabled Participant may
elect to withdraw the balance in his or her Contribution Account by notifying
the Sponsoring Employer in writing at least 15 days prior to the last day of the
Purchase Period. In the event no election to withdraw has been made, the balance
accumulated in the retired or disabled Participant's Contribution Account shall
be used to purchase shares of Common Stock in accordance with Article IV hereof.
In the event a retired or disabled Participant shall die during the Purchase
Period of such Participant's retirement or disability and such

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Participant shall not have notified his or her Sponsoring Employer of his or her
desire to withdraw his or her Contribution Account, the executor or
administrator of such Participant's estate shall have all the rights provided
pursuant to Section 3.05(a) hereof.

                                   ARTICLE IV

                            PURCHASE OF COMMON STOCK

       4.01 Purchase of Common Stock.

       (a) On each Purchase Date, each Participant's Contribution Account shall
be used to purchase the maximum number of whole shares of Common Stock permitted
hereunder at the applicable Purchase Price. No fractional shares shall be
purchased. Any payroll deductions accumulated in a Participant's Contribution
Account which are not sufficient to purchase a full share shall be retained in
the Participant's Contribution Account for the subsequent Purchase Period,
subject to earlier withdrawal by the Participant as provided in Section 3.03(d)
hereof. Any other monies left over in a Participant's Contribution Account after
the Purchase Date shall be returned to the Participant.

       (b) If, in any Purchase Period, the total number of shares of Common
Stock to be purchased pursuant to the Plan by all Participants exceeds the
number of shares authorized under the Plan, then each Participant shall purchase
his or her pro rata portion of the shares of Common Stock remaining available
under the Plan based on the balances in each Participant's Contribution Account
as of the Purchase Date in respect of such Purchase Period; provided, however,
                                                            --------  -------
that, in no event, shall any fractional shares of Common Stock be issued
pursuant to the Plan or this Section 4.01(b) hereof.

       (c) Any cash dividends paid with respect to shares of Common Stock held
for the account of a Participant shall be, as determined by the Committee on a
uniform basis as to all Participants, either (i) distributed to the Participant
or (ii) credited to the Participant's Contribution Account and used, in the same
manner as payroll deductions, to purchase additional shares of Common Stock
under the Plan on the next Purchase Date (subject to the limitations of Section
3.02 hereof).

       4.02 Purchase Price. For each Purchase Period, the Purchase Price per
share of Common Stock purchased pursuant to the Plan shall be the lesser of (a)
85% of the Closing Market Price on the Commencement Date of such Purchase
Period, and (b) 85% of the Closing Market Price on the Purchase Date of such
Purchase Period.

       4.03 Notice of Purchase, Stock Certificates, Voting Rights.

       (a) After the Purchase Date in respect of each Purchase Period, a report
will be made by the Company or its agent to each Participant stating the entries
made to his or her Contribution Account, the number of shares of Common Stock

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purchased and the applicable Purchase Price.

       (b) Evidence of shares of Common Stock purchased under the Plan shall be
maintained under the Plan for the account of each Participant and registered in
the manner determined by the Committee. Certificates for the number of whole
shares credited to a Participant's account under the Plan will be issued to a
Participant at any time promptly upon written request to the Company or its
agent; provided, however, that the Company may, at its election, issue such
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certificates at such time or times as the Committee deems appropriate,
including, without limitation, following an Employee's termination of employment
with a Sponsoring Employer.

       (c) Shares of Common Stock held under the Plan for the account of each
Participant shall be voted by the holder of record of such shares in accordance
with the Participant's instructions.

       4.04 Notification of Disposition of Stock. If a Participant or former
Participant disposes of a share of Common Stock purchased under the Plan prior
to two (2) years after the Commencement Date of the Purchase Period during which
such share was purchased, then such Participant or former Participant shall
notify his or her Sponsoring Employer immediately of such disposition in
writing.

                                   ARTICLE V

                            MISCELLANEOUS PROVISIONS

       5.01 Shares Subject to Plan; Adjustments.

       (a) The maximum number of shares of Common Stock which may be purchased
under the Plan is 1,500,000 subject, however, to adjustment as hereinafter set
forth. The shares of Common Stock to be purchased under the Plan will be made
available, at the discretion of the Board of Directors or the Committee, either
from authorized but unissued shares of Common Stock or from previously issued
shares of Common Stock reacquired by the Company, including shares purchased on
the open market.

       (b) If the outstanding shares of Common Stock of the Company are
increased, decreased, or exchanged for a different number or kind of shares or
other securities, or if additional shares or new or different shares or other
securities are distributed with respect to such shares of Common Stock or other
securities, through merger, consolidation, spin off, sale of all or
substantially all the property of the Company, reorganization, recapitalization,
reclassification, stock dividend, stock split, reverse stock split or other
distribution with respect to such shares of Common Stock, or other securities,
an appropriate and proportionate adjustment may be made in the maximum number
and kind of shares provided in Section 5.01(a) hereof, subject in the case of
certain corporate reorganizations to the requirements of Section 424(a) of the

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Code.

       5.02 Administration of the Plan.

       (a) Pursuant to the direction of the Board of Directors, the Committee
shall be responsible for the administration of the Plan. The Committee shall
have the discretionary authority to interpret the Plan and determine all
questions arising in the administration, application and operation of the Plan,
including all questions of fact and all questions of interpretation of the
provisions of the Plan. All such determinations by the Committee shall be
conclusive and binding on all persons. The Committee, from time to time, may
adopt, amend and rescind rules and regulations not inconsistent with the Plan
for carrying out the Plan, and may approve the forms of any documents or
writings provided for in the Plan. The Committee shall have full discretionary
authority to delegate ministerial functions of the Plan to employees of the
Company. No member of the Board of Directors or the Committee shall be liable
for any action, determination or omission taken or made in good faith with
respect to the Plan or any right granted hereunder.

       (b) The Committee may in its discretion engage a bank trust department,
securities brokerage firm or other financial institution as agent to perform
custodial and recordkeeping functions for the Plan, such as holding record title
to the Participants' stock certificates, maintaining an individual investment
account for each Participant and providing periodic account status reports to
Participants.

       (c) The Committee shall have the authority to adopt and enforce such
special rules and restrictions under the Plan to be applicable to Participants
who are subject to Section 16 of the Securities Exchange Act of 1934, as
amended, as the Committee shall deem are necessary or appropriate to exempt
certain Plan transactions from the requirements of such Section 16.

       (d) The Company shall bear the cost of administering the Plan, including
any fees, costs and expenses relating to the purchase of shares of Common Stock
under the Plan. Notwithstanding the foregoing, Participants will be responsible
for all fees, costs and expenses incurred in connection with the disposition of
shares of Common Stock purchased under the Plan.

       5.03 Termination and Amendment of the Plan.

       (a) The Company may, by action of the Board of Directors, terminate the
Plan at any time and for any reason. The Plan shall automatically terminate upon
the purchase by Participants of all shares of Common Stock subject to the Plan
under Section 5.01 hereof, unless such number of shares shall be increased by
the Board of Directors and such increase shall be approved by the shareholders
of the Company. Upon termination of the Plan, as soon as practicable, there
shall be refunded to each Participant the entire cash balance in his or her
Contribution Account, and there shall be forwarded

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to each Participant certificates for all whole shares of Common Stock held under
the Plan for the account of such Participant.

       (b) The Board of Directors reserves the right to modify, alter or amend
the Plan at any time and from time to time to any extent that it may deem
advisable, including, without limiting the generality of the foregoing, any
amendment deemed necessary to ensure compliance of the Plan with Section 423 of
the Code. Notwithstanding the foregoing, no amendment of the Plan shall operate
to reduce any amounts previously allocated to a Participant's Contribution
Account nor to reduce a Participant's rights with respect to shares of Common
Stock previously purchased and held on his or behalf under the Plan. The Board
of Directors may suspend operation of the Plan for any period as it may deem
advisable.

       5.04 Governing Law; Compliance With Law. The Plan shall be construed in
accordance with the laws of the State of Delaware. The Company's obligation to
sell and deliver shares of Common Stock hereunder shall be subject to all
applicable federal and state laws, rules and regulations and to such approvals
by any regulatory or governmental agency as may, in the opinion of counsel for
the Company, be required. The Company may make such provisions as it may deem
appropriate for the withholding of any taxes or payment of any taxes which it
determines it may be required to withhold or pay in connection with a
Participant's participation in the Plan.

       5.05 No Assignment. The purchase rights granted hereunder are not
assignable or transferable by the Participants, other than by will or the laws
of descent and distribution, and are exercisable during the Participant's
lifetime only by the Participant. Any attempted assignment, transfer or
alienation not in compliance with the terms of the Plan shall be null and void
for all purposes and respects.

       5.06 No Contract of Employment. The Plan will not be deemed to
constitute a contract between a Sponsoring Employer and any Participant or to be
a consideration or an inducement for the employment of any Participant or
Employee. Nothing contained in the Plan shall be deemed to give any Participant
or Employee the right to be retained in the service of a Sponsoring Employer or
to interfere with the right of a Sponsoring Employer to discharge any
Participant or Employee at any time regardless of the effect which such
discharge shall have upon him or her as a Participant of the Plan.

       5.07 No Rights as Stockholder. No eligible Employee or Participant shall
by reason of participation in the Plan have any rights of a stockholder of the
Company until he or she acquires shares of Common Stock as herein provided.

                                       9<PAGE>

                       INTEGRATED CIRCUIT SYSTEMS, INC.

                     2000 LONG-TERM EQUITY INCENTIVE PLAN

1.   Purpose.

          This plan shall be known as the Integrated Circuit Systems, Inc. 2000
Long-Term Equity Incentive Plan (the "Plan"). The purpose of the Plan shall be
to promote the long-term growth and profitability of Integrated Circuit Systems,
Inc. (the "Company") and its Subsidiaries by (i) providing certain directors,
officers and employees of, and certain other individuals who perform services
for, or to whom an offer of employment has been extended by, the Company and its
Subsidiaries with incentives to maximize shareholder value and otherwise
contribute to the success of the Company and (ii) enabling the Company to
attract, retain and reward the best available persons for positions of
responsibility. Grants of incentive or non-qualified stock options, stock
appreciation rights ("SARs"), either alone or in tandem with options, restricted
stock, performance awards, or any combination of the foregoing may be made under
the Plan.

2.   Definitions.

               (a)  "Board of Directors" and "Board" mean the board of directors
of the Company.

               (b)  "Cause" means the occurrence of one or more of the following
events:

                     (i)    conviction of a felony or any crime or offense
lesser than a felony involving the property of the Company or a Subsidiary; or

                     (ii)   conduct that has caused demonstrable and serious
injury to the Company or a Subsidiary, monetary or otherwise; or

                     (iii)  willful refusal to perform or substantial disregard
of duties properly assigned, as determined by the Company; or

                     (iv)   breach of duty of loyalty to the Company or a
Subsidiary or other act of fraud or dishonesty with respect to the Company or a
Subsidiary.

               (c)  "Change in Control" means the occurrence of one of the
following events:

                    (i)     if any "person" or "group" as those terms are used
in Sections 13(d) and 14(d) of the Exchange Act or any successors thereto, other
than an Exempt Person, is or becomes the "beneficial owner" (as defined in Rule
13d-3 under the Exchange Act or any successor thereto), directly or indirectly,
of securities of the Company representing 50% or more of the combined voting
power of the Company's then outstanding securities;
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               (ii)   during any period of two consecutive years, individuals
who at the beginning of such period constitute the Board and any new directors
whose election by the Board or nomination for election by the Company's
shareholders was approved by at least two-thirds of the directors then still in
office who either were directors at the beginning of the period or whose
election was previously so approved, cease for any reason to constitute a
majority thereof;

               (iii)  the shareholders of the Company approve a merger or
consolidation of the Company with any other corporation, other than a merger or
consolidation (A) which would result in all or a portion of the voting
securities of the Company outstanding immediately prior thereto continuing to
represent (either by remaining outstanding or by being converted into voting
securities of the surviving entity) more than 50% of the combined voting power
of the voting securities of the Company or such surviving entity outstanding
immediately after such merger or consolidation or (B) by which the corporate
existence of the Company is not affected and following which the Company's
chief executive officer and directors retain their positions with the Company
(and constitute at least a majority of the Board); or

               (iv)   the shareholders of the Company approve a plan of complete
liquidation of the Company or an agreement for the sale or disposition by the
Company of all or substantially all the Company's assets.

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

          (e)  "Committee" means the Compensation Committee of the Board, which
shall consist solely of two or more members of the Board.

          (f)  "Common Stock" means the common stock, par value $0.01 per share,
of the Company, and any other shares into which such stock may be changed by
reason of a recapitalization, reorganization, merger, consolidation or any other
change in the corporate structure or capital stock of the Company.

          (g)  "Competition" is deemed to occur if a person whose employment
with the Company or its Subsidiaries has terminated obtains a position as a
full-time or part-time employee of, as a member of the board of directors of, or
as a consultant or advisor with or to, or acquires an ownership interest in
excess of 5% of, a corporation, partnership, firm or other entity that engages
in any of the businesses of the Company or any Subsidiary with which the person
was involved in a management role at any time during his or her last five years
of employment with or other service for the Company or any Subsidiaries.

          (h)  "Disability" means a disability that would entitle an eligible
participant to payment of monthly disability payments under any Company
disability plan or as otherwise determined by the Committee.

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

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          (j)  "Exempt Person" means any employee benefit plan of the Company or
a trustee or other administrator or fiduciary holding securities under an
employee benefit plan of the Company.

          (k)  "Family Member" has the meaning given to such term in General
Instructions A.1(a)(5) to Form S-8 under the Securities Act of 1933, as amended,
and any successor thereto.

          (l)  "Fair Market Value" of a share of Common Stock of the Company
means, as of the date in question, the officially-quoted closing selling price
of the stock (or if no selling price is quoted, the bid price) on the principal
securities exchange on which the Common Stock is then listed for trading
(including for this purpose the Nasdaq National Market) (the "Market") for the
applicable trading day or, if the Common Stock is not then listed or quoted in
the Market, the Fair Market Value shall be the fair value of the Common Stock
determined in good faith by the Board; provided, however, that when shares
received upon exercise of an option are immediately sold in the open market, the
net sale price received may be used to determine the Fair Market Value of any
shares used to pay the exercise price or applicable withholding taxes and to
compute the withholding taxes.

          (m)  "Incentive Stock Option" means an option conforming to the
requirements of Section 422 of the Code and any successor thereto.

          (n)  "Non-Employee Director" has the meaning given to such term in
Rule 16b-3 under the Exchange Act and any successor thereto.

          (o)  "Non-qualified Stock Option" means any stock option other than an
Incentive Stock Option.

          (p)  "Other Company Securities" mean securities of the Company other
than Common Stock, which may include, without limitation, unbundled stock units
or components thereof, debentures, preferred stock, warrants and securities
convertible into or exchangeable for Common Stock or other property.

          (q)  "Retirement" means retirement as defined under any Company
pension plan or retirement program or termination of one's employment on
retirement with the approval of the Committee.

          (r)  "Subsidiary" means a corporation or other entity of which
outstanding shares or ownership interests representing 50% or more of the
combined voting power of such corporation or other entity entitled to elect the
management thereof, or such lesser percentage as may be approved by the
Committee, are owned directly or indirectly by the Company.

3.   Administration.

          The Plan shall be administered by the Committee; provided that the
Board may, in its discretion, at any time and from time to time, resolve to
administer the Plan, in which case the

                                      -3-
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term "Committee" shall be deemed to mean the Board for all purposes herein.
Subject to the provisions of the Plan, the Committee shall be authorized to (i)
select persons to participate in the Plan, (ii) determine the form and substance
of grants made under the Plan to each participant, and the conditions and
restrictions, if any, subject to which such grants will be made, (iii) certify
that the conditions and restrictions applicable to any grant have been met, (iv)
modify the terms of grants made under the Plan, (v) interpret the Plan and
grants made thereunder, (vi) make any adjustments necessary or desirable in
connection with grants made under the Plan to eligible participants located
outside the United States and (vii) adopt, amend, or rescind such rules and
regulations, and make such other determinations, for carrying out the Plan as it
may deem appropriate. Decisions of the Committee on all matters relating to the
Plan shall be in the Committee's sole discretion and shall be conclusive and
binding on all parties. The validity, construction, and effect of the Plan and
any rules and regulations relating to the Plan shall be determined in accordance
with applicable federal and state laws and rules and regulations promulgated
pursuant thereto. No member of the Committee and no officer of the Company shall
be liable for any action taken or omitted to be taken by such member, by any
other member of the Committee or by any officer of the Company in connection
with the performance of duties under the Plan, except for such person's own
willful misconduct or as expressly provided by statute.

          The expenses of the Plan shall be borne by the Company. The Plan shall
not be required to establish any special or separate fund or make any other
segregation of assets to assume the payment of any award under the Plan, and
rights to the payment of such awards shall be no greater than the rights of the
Company's general creditors.

4.   Shares Available for the Plan.

          Subject to adjustments as provided in Section 15, the number of shares
of Common Stock (the "Shares") issuable pursuant to the Plan shall equal the sum
of (a) 6,400,000 Shares, plus (b) any Shares returned to the Company's existing
stock option plans (the "Existing Plans") as a result of termination of options
under the Existing Plans, plus (c) an annual increase to be added on the date of
each annual meeting of the shareholders of the Company, beginning with the 2000
annual meeting of the shareholders, equal to one percent (1.0%) of the
outstanding Shares on such date or such lesser amount determined by the Board.
Such Shares may be in whole or in part authorized and unissued or held by the
Company as treasury shares. If any grant under the Plan expires or terminates
unexercised, becomes unexercisable or is forfeited as to any Shares, or is
tendered or withheld as to any shares in payment of the exercise price of the
grant or the taxes payable with respect to the exercise, then such unpurchased,
forfeited, tendered or withheld Shares shall thereafter be available for further
grants under the Plan unless, in the case of options granted under the Plan,
related SARs are exercised.

          Without limiting the generality of the foregoing provisions of this
Section 4 or the generality of the provisions of Sections 3, 6 or 17 or any
other section of this Plan, the Committee may, at any time or from time to time,
and on such terms and conditions (that are consistent with and not in
contravention of the other provisions of this Plan) as the Committee may, in its
sole discretion, determine, enter into agreements (or take other actions with
respect to the options) for new options containing terms (including exercise
prices) more (or less) favorable than the outstanding options.

                                      -4-
<PAGE>

5.   Participation.

          (a)  Participation in the Plan shall be limited to those directors
(including Non-Employee Directors), officers (including non-employee officers)
and employees of, and other individuals performing services for, or to whom an
offer of employment has been extended by, the Company and its Subsidiaries
selected by the Committee (including participants located outside the United
States). Nothing in the Plan or in any grant thereunder shall confer any right
on a participant to continue in the employ as a director or officer of or in the
performance of services for the Company or shall interfere in any way with the
right of the Company to terminate the employment or performance of services or
to reduce the compensation or responsibilities of a participant at any time. By
accepting any award under the Plan, each participant and each person claiming
under or through him or her shall be conclusively deemed to have indicated his
or her acceptance and ratification of, and consent to, any action taken under
the Plan by the Company, the Board or the Committee.

          Incentive Stock Options or Non-qualified Stock Options, SARs alone or
in tandem with options, restricted stock awards, performance awards, or any
combination thereof, may be granted to such persons and for such number of
Shares as the Committee shall determine (such individuals to whom grants are
made being sometimes herein called "optionees" or "grantees," as the case may
be). Determinations made by the Committee under the Plan need not be uniform and
may be made selectively among eligible individuals under the Plan, whether or
not such individuals are similarly situated. A grant of any type made hereunder
in any one year to an eligible participant shall neither guarantee nor preclude
a further grant of that or any other type to such participant in that year or
subsequent years.

          (b) Each Non-Employee Director (other than Non-Employee Directors
affiliated with any shareholder of the Company beneficially owning 10% or more
of the outstanding Common Stock) shall be entitled to receive a yearly payment
in cash or Common Stock in an amount equal to, or, in the case of payment in
Common Stock, valued at, not less than $15,000 and not greater than $30,000 and
to be paid at such time, in each case, as determined by the Board.

6.   Incentive and Non-qualified Options and SARs.

          The Committee may from time to time grant to eligible participants
Incentive Stock Options, Non-qualified Stock Options, or any combination
thereof; provided that the Committee may grant Incentive Stock Options only to
eligible employees of the Company or its subsidiaries (as defined for this
purpose in Section 424(f) of the Code or any successor thereto). In any one
calendar year, the Committee shall not grant to any one participant options or
SARs to purchase a number of shares of Common Stock in excess of 10% of the
total number of Shares authorized under the Plan pursuant to Section 4. The
options granted shall take such form as the Committee shall determine, subject
to the following terms and conditions.

          It is the Company's intent that Non-qualified Stock Options granted
under the Plan not be classified as Incentive Stock Options, that Incentive
Stock Options be consistent with and

                                      -5-
<PAGE>

contain or be deemed to contain all provisions required under Section 422 of the
Code and any successor thereto, and that any ambiguities in construction be
interpreted in order to effectuate such intent. If an Incentive Stock Option
granted under the Plan does not qualify as such for any reason, then to the
extent of such non-qualification, the stock option represented thereby shall be
regarded as a Non-qualified Stock Option duly granted under the Plan, provided
that such stock option otherwise meets the Plan's requirements for Non-qualified
Stock Options.

          (a)  Price. The price per Share deliverable upon the exercise of each
option ("exercise price") shall be established by the Committee, except that in
the case of the grant of any Option, the exercise price may not be less than 50%
of the Fair Market Value of a share of Common Stock as of the date of grant of
the option, and in the case of the grant of any Incentive Stock Option to an
employee who, at the time of the grant, owns more than 10% of the total combined
voting power of all classes of stock of the Company or any of its Subsidiaries,
the exercise price may not be less than 110% of the Fair Market Value of a share
of Common Stock as of the date of grant of the option, in each case unless
otherwise permitted by Section 422 of the Code or any successor thereto.

          (b)  Payment. Options may be exercised, in whole or in part, upon
payment of the exercise price of the Shares to be acquired. Unless otherwise
determined by the Committee, payment shall be made (i) in cash (including check,
bank draft, money order or wire transfer of immediately available funds), (ii)
by delivery of outstanding shares of Common Stock with a Fair Market Value on
the date of exercise equal to the aggregate exercise price payable with respect
to the options' exercise, (iii) by simultaneous sale through a broker reasonably
acceptable to the Committee of Shares acquired on exercise, as permitted under
Regulation T of the Federal Reserve Board, (iv) by authorizing the Company to
withhold from issuance a number of Shares issuable upon exercise of the options
which, when multiplied by the Fair Market Value of a share of Common Stock on
the date of exercise, is equal to the aggregate exercise price payable with
respect to the options so exercised or (v) by any combination of the foregoing.
Options may also be exercised upon payment of the exercise price of the Shares
to be acquired by delivery of the optionee's promissory note, but only to the
extent specifically approved by and in accordance with the policies of the
Committee.

          In the event a grantee elects to pay the exercise price payable with
respect to an option pursuant to clause (ii) above, (A) only a whole number of
share(s) of Common Stock (and not fractional shares of Common Stock) may be
tendered in payment, (B) such grantee must present evidence acceptable to the
Company that he or she has owned any such shares of Common Stock tendered in
payment of the exercise price (and that such tendered shares of Common Stock
have not been subject to any substantial risk of forfeiture) for at least six
months prior to the date of exercise, and (C) Common Stock must be delivered to
the Company. Delivery for this purpose may, at the election of the grantee, be
made either by (A) physical delivery of the certificate(s) for all such shares
of Common Stock tendered in payment of the price, accompanied by duly executed
instruments of transfer in a form acceptable to the Company, or (B) direction to
the grantee's broker to transfer, by book entry, of such shares of Common Stock
from a brokerage account of the grantee to a brokerage account specified by the
Company. When payment of the exercise price is made by delivery of Common Stock,
the difference, if any, between the aggregate exercise price payable with
respect to the option being exercised and the Fair Market Value of the shares of
Common Stock

                                      -6-
<PAGE>

tendered in payment (plus any applicable taxes) shall be paid in cash. No
grantee may tender shares of Common Stock having a Fair Market Value exceeding
the aggregate exercise price payable with respect to the option being exercised
(plus any applicable taxes).

          In the event a grantee elects to pay the exercise price payable with
respect to an option pursuant to clause (iv) above, (A) only a whole number of
Shares(s) (and not fractional Shares) may be withheld in payment and (B) such
grantee must present evidence acceptable to the Company that he or she has owned
a number of shares of Common Stock at least equal to the number of Shares to be
withheld in payment of the exercise price (and that such owned shares of Common
Stock have not been subject to any substantial risk of forfeiture) for at least
six months prior to the date of exercise. When payment of the exercise price
is made by withholding of Shares, the difference, if any, between the aggregate
exercise price payable with respect to the option being exercised and the Fair
Market Value of the Shares withheld in payment (plus any applicable taxes) shall
be paid in cash. No grantee may authorize the withholding of Shares having a
Fair Market Value exceeding the aggregate exercise price payable with respect to
the option being exercised (plus any applicable taxes). Any withheld Shares
shall no longer be issuable under such option (except pursuant to any Reload
Option (as defined below) with respect to any such withheld Shares).

          (c)  Terms of Options. The term during which each option may be
exercised shall be determined by the Committee, but if required by the Code and
except as otherwise provided herein, no option shall be exercisable in whole or
in part more than ten years from the date it is granted, and no Incentive Stock
Option granted to an employee who at the time of the grant owns more than 10% of
the total combined voting power of all classes of stock of the Company or any of
its Subsidiaries shall be exercisable more than five years from the date it is
granted. All rights to purchase Shares pursuant to an option shall, unless
sooner terminated, expire at the date designated by the Committee. The
Committee shall determine the date on which each option shall become exercisable
and may provide that an option shall become exercisable in installments. The
Shares constituting each installment may be purchased in whole or in part at any
time after such installment becomes exercisable, subject to such minimum
exercise requirements as may be designated by the Committee. Prior to the
exercise of an option and delivery of the Shares represented thereby, the
optionee shall have no rights as a shareholder with respect to any Shares
covered by such outstanding option (including any dividend or voting rights).

          (d)  Limitations on Grants. If required by the Code, the aggregate
Fair Market Value (determined as of the grant date) of Shares for which an
Incentive Stock Option is exercisable for the first time during any calendar
year under all equity incentive plans of the Company and its Subsidiaries (as
defined in Section 422 of the Code or any successor thereto) may not exceed
$100,000.

          (e)  Termination; Forfeiture.

               (i)   Death or Disability. If a participant ceases to be a
director, officer or employee of, or to perform other services for, the Company
and any Subsidiary due to death or Disability, all of the participant's options
and SARs that were exercisable on the date of death or Disability shall remain
exercisable for, and shall otherwise terminate at the end of, a period of 180

                                      -7-
<PAGE>

days from the date of such death or Disability, but in no event after the
expiration date of the options or SARs. Notwithstanding the foregoing, if the
Disability giving rise to the termination of employment is not within the
meaning of Section 22(e)(3) of the Code or any successor thereto, Incentive
Stock Options not exercised by such participant within 90 days after the date of
termination of employment will cease to qualify as Incentive Stock Options and
will be treated as Non-qualified Stock Options under the Plan if required to be
so treated under the Code.

               (ii)   Retirement. If a participant ceases to be a director,
officer or employee of, or to perform other services for, the Company and any
Subsidiary upon the occurrence of his or her Retirement, (A) all of the
participant's options and SARs that were exercisable on the date of Retirement
shall remain exercisable for, and shall otherwise terminate at the end of, a
period of 90 days after the date of Retirement, but in no event after the
expiration date of the options or SARs; provided that the participant does not
engage in Competition during such 90-day period unless he or she receives
written consent to do so from the Board or the Committee, and (B) all of the
participant's options and SARs that were not exercisable on the date of
Retirement shall be forfeited immediately upon such Retirement; provided,
however, that such options and SARs may become fully vested and exercisable in
the discretion of the Committee.

               (iii)  Discharge for Cause. If a participant ceases to be a
director, officer or employee of, or to perform other services for, the Company
or a Subsidiary due to Cause, or if a participant does not become a director,
officer or employee of, or does not begin performing other services for, the
Company or a Subsidiary for any reason, all of the participant's options and
SARs shall expire and be forfeited immediately upon such cessation or
non-commencement, whether or not then exercisable.

               (iv)   Other Termination. Unless otherwise determined by the
Committee, if a participant ceases to be a director, officer or employee of, or
to otherwise perform services for, the Company or a Subsidiary for any reason
other than death, Disability, Retirement or Cause, (A) all of the participant's
options and SARs that were exercisable on the date of such cessation shall
remain exercisable for, and shall otherwise terminate at the end of, a period of
30 days after the date of such cessation, but in no event after the expiration
date of the options or SARs; provided that the participant does not engage in
Competition during such 30-day period unless he or she receives written consent
to do so from the Board or the Committee, and (B) all of the participant's
options and SARs that were not exercisable on the date of such cessation shall
be forfeited immediately upon such cessation.

               (v)    Change in Control. If there is a Change in Control of the
Company and a participant is terminated as a director, officer or employee of,
or from performing other services for, the Company or a subsidiary within one
year after such Change in Control, all of the participant's options and SARs
shall become fully vested and exercisable upon such termination and shall remain
so until the expiration date of the options or SARs. In addition, the
Compensation Committee shall have the authority to grant options that become
fully vested and exercisable automatically upon a Change in Control, whether or
not the grantee is subsequently terminated.

                                      -8-
<PAGE>

          (f)  Forfeiture. If a participant exercises any of his or her options
or SARs and, within one year thereafter, either (i) is terminated from the
Company or a Subsidiary for any of the reasons specified in the definition of
"Cause" set forth in Section 2(b)(i), (ii) or (iv), or (ii) engages in
Competition without having received written consent to do so from the Board or
the Committee, then the participant may, in the discretion of the Committee, be
required to pay the Company the gain represented by the difference between the
aggregate selling price of the Shares acquired upon the options' exercise (or,
if the Shares were not then sold, their aggregate Fair Market Value on the date
of exercise) and the aggregate exercise price of the options exercised (the
"Option Gain"), without regard to any subsequent increase or decrease in the
Fair Market Value of the Common Stock. In addition, the Company may, in its
discretion, deduct from any payment of any kind (including salary or bonus)
otherwise due to any such participant an amount equal to the Option Gain.

          (g)  Grant of Reload Options. The Committee may provide (either at the
time of grant or exercise of an option), in its discretion, for the grant to a
grantee who exercises all or any portion of an option ("Exercised Options") and
who pays all or part of such exercise price with shares of Common Stock, of an
additional option (a "Reload Option") for a number of shares of Common Stock
equal to the sum (the "Reload Number") of the number of shares of Common Stock
tendered or withheld in payment of such exercise price for the Exercised Options
plus, if so provided by the Committee, the number of shares of Common Stock, if
any, tendered or withheld by the grantee or withheld by the Company in
connection with the exercise of the Exercised Options to satisfy any federal,
state or local tax withholding requirements. The terms of each Reload Option,
including the date of its expiration and the terms and conditions of its
exercisability and transferability, shall be the same as the terms of the
Exercised Option to which it relates, except that (i) the grant date for each
Reload Option shall be the date of exercise of the Exercised Option to which it
relates and (ii) the exercise price for each Reload Option shall be the Fair
Market Value of the Common Stock on the grant date of the Reload Option.

7.   Stock Appreciation Rights.

          The Committee shall have the authority to grant SARs under this Plan,
either alone or to any optionee in tandem with options (either at the time of
grant of the related option or thereafter by amendment to an outstanding
option). SARs shall be subject to such terms and conditions as the Committee may
specify.

          No SAR may be exercised unless the Fair Market Value of a share of
Common Stock of the Company on the date of exercise exceeds the exercise price
of the SAR or, in the case of SARs granted in tandem with options, any options
to which the SARs correspond. Prior to the exercise of the SAR and delivery of
the cash and/or Shares represented thereby, the participant shall have no rights
as a shareholder with respect to Shares covered by such outstanding SAR
(including any dividend or voting rights).

          SARs granted in tandem with options shall be exercisable only when, to
the extent and on the conditions that any related option is exercisable. The
exercise of an option shall result in an immediate forfeiture of any related SAR
to the extent the option is exercised, and the exercise

                                      -9-
<PAGE>

of an SAR shall cause an immediate forfeiture of any related option to the
extent the SAR is exercised.

          Upon the exercise of an SAR, the participant shall be entitled to a
distribution in an amount equal to the difference between the Fair Market Value
of a share of Common Stock on the date of exercise and the exercise price of the
SAR or, in the case of SARs granted in tandem with options, any option to which
the SAR is related, multiplied by the number of Shares as to which the SAR is
exercised. The Committee shall decide whether such distribution shall be in
cash, in Shares having a Fair Market Value equal to such amount, in Other
Company Securities having a Fair Market Value equal to such amount or in a
combination thereof.

          All SARs will be exercised automatically on the last day prior to the
expiration date of the SAR or, in the case of SARs granted in tandem with
options, any related option, so long as the Fair Market Value of a share of
Common Stock on that date exceeds the exercise price of the SAR or any related
option, as applicable. An SAR granted in tandem with options shall expire at the
same time as any related option expires and shall be transferable only when, and
under the same conditions as, any related option is transferable.

8.   Restricted Stock.

          The Committee may at any time and from time to time grant Shares of
restricted stock under the Plan to such participants and in such amounts as it
determines. Each grant of restricted stock shall specify the applicable
restrictions on such Shares, the duration of such restrictions (which shall be
at least six months except as otherwise determined by the Committee or provided
in the third paragraph of this Section 8), and the time or times at which such
restrictions shall lapse with respect to all or a specified number of Shares
that are part of the grant.

          The participant will be required to pay the Company the aggregate par
value of any Shares of restricted stock (or such larger amount as the Board may
determine based upon applicable law) within ten days of the date of grant,
unless such Shares of restricted stock are treasury shares. Unless otherwise
determined by the Committee, certificates representing Shares of restricted
stock granted under the Plan will be held in escrow by the Company on the
participant's behalf during any period of restriction thereon and will bear an
appropriate legend specifying the applicable restrictions thereon, and the
participant will be required to execute a blank stock power therefor. Except as
otherwise provided by the Committee, during such period of restriction the
participant shall have all of the rights of a holder of Common Stock, including
but not limited to the rights to receive dividends and to vote, and any stock
or other securities received as a distribution with respect to such
participant's restricted stock shall be subject to the same restrictions as then
in effect for the restricted stock.

          Except as otherwise provided by the Committee, no restrictions on
Shares shall lapse because of a Change in Control or the death, Disability or
Retirement of any participant. At such time as a participant ceases to be, or in
the event a participant does not become, a director, officer or employee of, or
otherwise performing services for, the Company or its Subsidiaries for any other

                                     -10-

<PAGE>

reason, all Shares of restricted stock granted to such participant on which the
restrictions have not lapsed shall be immediately forfeited to the Company.

9.   Performance Awards.

               Performance awards may be granted to participants at any time and
from time to time as determined by the Committee. The Committee shall have
complete discretion in determining the size and composition of performance
awards granted to a participant and the appropriate period over which
performance is to be measured (a "performance cycle"). Performance awards may
include (i) specific dollar-value target awards (ii) performance units, the
value of each such unit being determined by the Committee at the time of
issuance, and/or (iii) performance Shares, the value of each such Share being
equal to the Fair Market Value of a share of Common Stock.

               The value of each performance award may be fixed or it may be
permitted to fluctuate based on a performance factor (e.g., return on equity)
selected by the Committee.

               The Committee shall establish performance goals and objectives
for each performance cycle on the basis of such criteria and objectives as the
Committee may select from time to time, including, without limitation, the
performance of the participant, the Company, one or more of its Subsidiaries or
divisions or any combination of the foregoing. During any performance cycle, the
Committee shall have the authority to adjust the performance goals and
objectives for such cycle for such reasons as it deems equitable.

               The Committee shall determine the portion of each performance
award that is earned by a participant on the basis of the Company's performance
over the performance cycle in relation to the performance goals for such cycle.
The earned portion of a performance award may be paid out in Shares, cash, Other
Company Securities, or any combination thereof, as the Committee may determine.

               A participant must be a director, officer or employee of, or
otherwise perform services for, the Company or its Subsidiaries at the end of
the performance cycle in order to be entitled to payment of a performance award
issued in respect of such cycle; provided, however, that except as otherwise
determined by the Committee, if a participant ceases to be a director, officer
or employee of, or to otherwise perform services for, the Company and its
Subsidiaries upon his or her death, Retirement, or Disability prior to the end
of the performance cycle, the participant shall earn a proportionate portion of
the performance award based upon the elapsed portion of the performance cycle
and the Company's performance over that portion of such cycle.

               In the event of a Change in Control, a participant shall earn no
less than the portion of the performance award that the participant would have
earned if the applicable performance cycle(s) had terminated as of the date of
the Change in Control.

10.  Withholding Taxes.

                                     -11-

<PAGE>

     (1)  Participant Election. Unless otherwise determined by the Committee, a
participant may elect to deliver shares of Common Stock (or have the Company
withhold shares acquired upon exercise of an option or SAR or deliverable upon
grant or vesting of restricted stock, as the case may be) to satisfy, in whole
or in part, the amount the Company is required to withhold for taxes in
connection with the exercise of an option or SAR or the delivery of restricted
stock upon grant or vesting, as the case may be. Such election must be made on
or before the date the amount of tax to be withheld is determined. Once made,
the election shall be irrevocable. The fair market value of the shares to be
withheld or delivered will be the Fair Market Value as of the date the amount of
tax to be withheld is determined. In the event a participant elects to deliver
or have the Company withhold shares of Common Stock pursuant to this Section
10(a), such delivery or withholding must be made subject to the conditions and
pursuant to the procedures set forth in Section 6(b) with respect to the
delivery or withholding of Common Stock in payment of the exercise price of
options.

     (2)  Company Requirement. The Company may require, as a condition to any
grant or exercise under the Plan or to the delivery of certificates for Shares
issued hereunder, that the grantee make provision for the payment to the
Company, either pursuant to Section 10(a) or this Section 10(b), of federal,
state or local taxes of any kind required by law to be withheld with respect to
any grant or delivery of Shares. The Company, to the extent permitted or
required by law, shall have the right to deduct from any payment of any kind
(including salary or bonus) otherwise due to a grantee, an amount equal to any
federal, state or local taxes of any kind required by law to be withheld with
respect to any grant or delivery of Shares under the Plan.

11.  Written Agreement; Vesting.

          Each employee to whom a grant is made under the Plan shall enter into
a written agreement with the Company that shall contain such provisions,
including without limitation vesting requirements, consistent with the
provisions of the Plan, as may be approved by the Committee. Unless the
Committee determines otherwise and except as otherwise provided in Sections 6,
7, 8 and 9 in connection with a Change of Control or certain occurrences of
termination, no grant under this Plan may be exercised, and no restrictions
relating thereto may lapse, within six months of the date such grant is made.

12.  Transferability.

          Unless the Committee determines otherwise, no option, SAR, performance
award or restricted stock granted under the Plan shall be transferable by a
participant other than by will or the laws of descent and distribution or to a
participant's Family Member by gift or a qualified domestic relations order as
defined by the Code. Unless the Committee determines otherwise, an option, SAR
or performance award may be exercised only by the optionee or grantee thereof;
by his or her Family Member if such person has acquired the option, SAR or
performance award by gift or qualified domestic relations order; by his or her
executor or administrator or any person to whom the Option is transferred by
will or the laws of descent and distribution; or by his or her guardian or legal
representative; provided that Incentive Stock Options may be exercised by any
Family Member, guardian or legal representative only if permitted by the Code
and any regulations thereunder. All provisions of this Plan shall in any event
continue to apply to any option, SAR, performance award

                                     -12-

<PAGE>

or restricted stock granted under the Plan and transferred as permitted by this
Section 12, and any transferee of any such option, SAR, performance award or
restricted stock shall be bound by all provisions of this Plan as and to the
same extent as the applicable original grantee.

13.  Listing, Registration and Qualification.

          If the Committee determines that the listing, registration or
qualification upon any securities exchange or under any law of Shares subject to
any option, SAR, performance award or restricted stock grant is necessary or
desirable as a condition of, or in connection with, the granting of same or the
issue or purchase of Shares thereunder, no such option or SAR may be exercised
in whole or in part, no such performance award may be paid out, and no Shares
may be issued, unless such listing, registration or qualification is effected
free of any conditions not acceptable to the Committee.

14.  Transfer of Employee.

          The transfer of an employee from the Company to a Subsidiary, from a
Subsidiary to the Company, or from one Subsidiary to another shall not be
considered a termination of employment; nor shall it be considered a termination
of employment if an employee is placed on military or sick leave or such other
leave of absence which is considered by the Committee as continuing intact the
employment relationship.

15.  Adjustments.

          In the event of a reorganization, recapitalization, stock split, stock
dividend, combination of shares, merger, consolidation, distribution of assets,
or any other change in the corporate structure or shares of the Company, the
Committee shall make such adjustment as it deems appropriate in the number and
kind of Shares or other property available for issuance under the Plan
(including, without limitation, the total number of Shares available for
issuance under the Plan pursuant to Section 4), in the number and kind of
options, SARs, Shares or other property covered by grants previously made under
the Plan, and in the exercise price of outstanding options and SARs. Any such
adjustment shall be final, conclusive and binding for all purposes of the Plan.
In the event of any merger, consolidation or other reorganization in which the
Company is not the surviving or continuing corporation or in which a Change in
Control is to occur, all of the Company's obligations regarding options, SARs,
performance awards, and restricted stock that were granted hereunder and that
are outstanding on the date of such event shall, on such terms as may be
approved by the Committee prior to such event, be assumed by the surviving or
continuing corporation or canceled in exchange for property (including cash).

          Without limitation of the foregoing, in connection with any
transaction of the type specified by clause (iii) of the definition of a Change
in Control in Section 2(c), the Committee may, in its discretion, (i) cancel any
or all outstanding options under the Plan in consideration for payment to the
holders thereof of an amount equal to the portion of the consideration that
would have been payable to such holders pursuant to such transaction if their
options had been fully exercised immediately prior to such transaction, less the
aggregate exercise price that would have been payable

                                     -13-
<PAGE>

therefor, or (ii) if the amount that would have been payable to the option
holders pursuant to such transaction if their options had been fully exercised
immediately prior thereto would be equal to or less than the aggregate exercise
price that would have been payable therefor, cancel any or all such options for
no consideration or payment of any kind. Payment of any amount payable pursuant
to the preceding sentence may be made in cash or, in the event that the
consideration to be received in such transaction includes securities or other
property, in cash and/or securities or other property in the Committee's
discretion.

16.  Amendment and Termination of the Plan.

          The Board of Directors or the Committee, without approval of the
shareholders, may amend or terminate the Plan, except that no amendment shall
become effective without prior approval of the shareholders of the Company if
shareholder approval would be required by applicable law or regulations,
including if required for continued compliance with the performance-based
compensation exception of Section 162(m) of the Code or any successor thereto,
under the provisions of Section 422 of the Code or any successor thereto, or by
any listing requirement of the principal stock exchange on which the Common
Stock is then listed.

17.  Amendment or Substitution of Awards under the Plan.

          The terms of any outstanding award under the Plan may be amended from
time to time by the Committee in its discretion in any manner that it deems
appropriate (including, but not limited to, acceleration of the date of exercise
of any award and/or payments thereunder or of the date of lapse of restrictions
on Shares); provided that, except as otherwise provided in Section 15, no such
amendment shall adversely affect in a material manner any right of a participant
under the award without his or her written consent. The Committee may, in its
discretion, permit holders of awards under the Plan to surrender outstanding
awards in order to exercise or realize rights under other awards, or in exchange
for the grant of new awards, or require holders of awards to surrender
outstanding awards as a condition precedent to the grant of new awards under the
Plan.

18.  Commencement Date; Termination Date.

          The date of commencement of the Plan shall be May 22, 2000, subject to
approval by the shareholders of the Company. If required by the Code, the Plan
will also be subject to reapproval by the shareholders of the Company prior to
the fifth anniversary of the date of commencement of this Plan.

          Unless previously terminated upon the adoption of a resolution of the
Board terminating the Plan, the Plan shall terminate at the close of business on
the tenth anniversary of the date of commencement of this Plan. No termination
of the Plan shall materially and adversely affect any of the rights or
obligations of any person, without his or her written consent, under any grant
of options or other incentives theretofore granted under the Plan.

                                     -14-
<PAGE>

19.  Severability. Whenever possible, each provision of the Plan shall be
interpreted in such manner as to be effective and valid under applicable law,
but if any provision of the Plan is held to be prohibited by or invalid under
applicable law, such provision shall be ineffective only to the extent of such
prohibition or invalidity, without invalidating the remainder of the Plan.

20.  Governing Law. The Plan shall be governed by the corporate laws of the
State of Pennsylvania, without giving effect to any choice of law provisions
that might otherwise refer construction or interpretation of the Plan to the
substantive law of another jurisdiction.

                                     -15-

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