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                                                                  EXHIBIT 10.4

                                FORM OF DEBENTURE

THESE SECURITIES HAVE NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933, AS
AMENDED (THE "ACT"), AND MAY NOT BE OFFERED OR SOLD IN THE UNITED STATES OR TO
U.S. PERSONS (OTHER THAN DISTRIBUTORS) UNLESS THE SECURITIES ARE REGISTERED
UNDER THE ACT OR AN EXEMPTION FROM THE REGISTRATION REQUIREMENT OF THE ACT IS
AVAILABLE. THIS SUBSCRIPTION AGREEMENT SHALL NOT CONSTITUTE AN OFFER TO SELL NOR
A SOLICITATION OF AN OFFER TO BUY THE SECURITIES IN ANY JURISDICTION IN WHICH
SUCH OFFER OR SOLICITATION WOULD BE UNLAWFUL.

No.______                                                      $_________ U.S.

                                CLEARLOGIC, INC.
                 8% CONVERTIBLE DEBENTURE DUE DECEMBER 31, 2002

         THIS DEBENTURE is one of a duly authorized issue of Debentures of
CLEARLOGIC, INC., a corporation duly organized and existing under the laws of
the State of New Jersey (the "Company") designated as its 8% Convertible
Debentures Due December 31, 2002, in an aggregate principal amount not exceeding
$1,000,000 U.S.

         FOR VALUE RECEIVED, the Company promises to pay to ___________________,
the registered holder hereof (the "Holder"), the principal sum of
_____________________ Dollars ($________ U.S.), on December 31, 2002, (the
"Maturity Date") and to pay interest on the principal sum outstanding from time
to time in arrears on the Maturity Date, at the rate of 8% per annum accruing
from the date of initial issuance. Accrual of interest shall commence on the
first such business day to occur after the date hereof until payment in full of
the principal sum has been made or duly provided for. All accrued and unpaid
interest shall bear interest at the same rate as the due date of the interest
payment until paid. The interest so payable will be paid on the Maturity Date to
the person in whose name this Debenture (or one or more predecessor Debentures)
is registered on the records of the Company regarding registration and transfers
of the Debentures (the "Debenture Register") on the tenth day prior to the
Maturity Date; provided, however, that the Company's obligation to a transferee
of this Debenture arises only if such transfer, sale or other disposition is
made in accordance with the terms and conditions of the Subscription Agreement
(the "Agreement") executed by the original Holder. The principal of, and
interest on, this Debenture are payable in such coin or currency of the United
States of America as at the time of payment is legal tender for payment of
public and private

                             (continued on reverse)

         IN WITNESS WHEREOF, the Company has caused this instrument to be duly
executed by an officer thereunto duly authorized.

                                             CLEARLOGIC, INC.

Dated: ________________________              By: _______________________________

                                      - 1 -

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debts, at the address last appearing on the Debenture Register of the Company as
designated in writing by the Holder from time to time. The Company will pay the
principal of and interest upon this Debenture on the Maturity Date, less any
amounts required by law to be deducted, to the registered holder of this
Debenture reflected in the Debenture Register as of the tenth day prior to the
Maturity Date and addressed to such holder at the last address appearing on the
Debenture Register. The forwarding of such check shall constitute a payment of
interest hereunder and shall satisfy and discharge the liability for principal
and interest on this Debenture to the extent of the sum represented by such
check plus any amounts so deducted unless such check is not paid at par. At the
option of the Company, interest herein may be payable in shares of Company
Common Stock valued at the conversion price described in Section 5.

         This Debenture is subject to the following additional provisions:

         1. The Debentures are issuable in denominations of Five Hundred
Thousand Dollars ($500,000 U.S.) and integral multiples thereof. The Debentures
are exchangeable for an equal aggregate principal amount of Debentures of
different authorized denominations, as requested by the Holders surrendering the
same. No service charge will be made for such registration of transfer or
exchange.

         2. The Company shall be entitled to withhold from all payments of
principal of, and interest on, this Debenture any amounts required to be
withheld under the applicable provisions of the United States income tax laws or
other applicable laws at the time of such payments.

         3. This Debenture has been issued subject to investment representations
of the original purchaser hereof and may be transferred or exchanged only in
compliance with the Securities Act of 1933, as amended (the "Act") and upon
receipt of an opinion of counsel reasonably satisfactory to the Company. Prior
to due presentment for transfer of this Debenture, the Company and any agent of
the Company may treat the person in whose name this Debenture is duly registered
on the Company's Debenture Register as the owner hereof for the purpose of
receiving payment as herein provided and for all other purposes, whether or not
this Debenture be overdue, and neither the Company nor any such agent shall be
affected by notice to the contrary.

         4. The Company covenants and agrees, and each holder of Debentures, by
his acceptance thereof, likewise covenants and agrees, that the indebtedness
evidenced by the Debentures and the payment of the principal thereof and
interest thereon shall be subordinate and subject in right of payment, to the
extent and in the manner hereinafter set forth, to the prior payment in full of
all "Senior Indebtedness." The term "Senior Indebtedness" of the Company shall
mean (i) the principal of and accrued and unpaid interest on all indebtedness of
the Company, whether outstanding on the date of issuance of this Debenture or
thereafter created, incurred, or assumed, for money borrowed from one or more
banks, insurance companies, financial institutions, governmental entities or any
other persons which regularly engage in lending money, unless such indebtedness
shall, in the instrument creating the same, be

                                      - 2 -

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specifically designated as not being senior in right of payment to the
Debentures; and (ii) any modifications, renewals, extensions, deferrals, and
refunding of any such indebtedness, liabilities, or obligations; provided,
however, that Senior Indebtedness shall not be deemed to include any obligation
of the Company in connection with extensions of credit by trade creditors and
suppliers.

         5. The Holder of this Debenture is entitled, at its option, subject to
the conditions in paragraph 6 below, at any time, until maturity hereof to
convert the principal amount of this Debenture or any portion of the principal
amount hereof which is at least Five Hundred Thousand Dollars ($500,000 U.S.),
or, if at the time of such election to convert the aggregate principal amount of
all Debentures registered to the Holder is less than Five Hundred Thousand
Dollars ($500,000 U.S.), then the whole amount thereof, into Shares of Common
Stock of the Company at a conversion price for each share of Common Stock equal
to the lower of the Market Price of the Common Stock on the first day of
trading, or 75% of the Market Price of the Company's Common Stock averaged over
the five trading days prior to the date of conversion. For purposes of this
Section 5, the Market Price shall be the closing bid price of the Common Stock,
as reported by the National Association of Securities Dealers Inc., Automated
Quotation System or, in the event the Common Stock is listed on a stock
exchange, the fair market value per Share shall be the closing price on the
exchange, as reported in the Wall Street Journal. Such conversion shall be
effectuated by surrendering the Debentures to be converted to the Company, at 41
South Haddon Avenue, Haddonfield, NJ 08033, facsimile (856) 547-7824 with the
form of conversion notice attached hereto as Exhibit A, executed by the Holder
of this Debenture evidencing such Holder's intention to convert this Debenture
or a specified portion (as above provided) hereof, and accompanied, if such
shares are to be issued in a name other than Holder, by proper assignment hereof
in blank. Any accrued and unpaid interest shall be payable, at the option of the
Company, in cash or in shares valued at the then effective conversion price. No
fractions of shares or scrip representing fractions of shares will be issued on
conversion, but the number of shares issuable shall be rounded to the nearest
whole share. The date on which notice of conversion is given shall be deemed to
be the date on which the Holder has delivered this Debenture, with the
conversion notice duly executed, to the Company, or, if earlier, the date set
forth in such notice of conversion if this Debenture is received by the Company
within two business days' thereafter.

         6. The Holder of this Debenture is obligated to give two (2) business
days advance notice of its intent to convert at which time the Company may
exercise its right to redeem any or all said portion of such debenture. At the
end of this 48-hour period the Holder may continue with its intended conversion.

         7. This Debenture is redeemable at the option of the Company on no less
than 10 days' written notice by the Company at a redemption price equal to 115%
of the face amount hereof, plus accrued and unpaid interest to the redemption
date.

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         8. This Debenture and all other Debentures now or hereafter issued of
similar terms are direct obligations of the Company. This Debenture ranks
equally and ratably with all other Debentures now or hereafter issued under this
terms set forth herein.

         9. No recourse shall be had for the payment of the principal of, or the
interest on, this Debenture, or for any claim based hereon, or otherwise in
respect hereof, against any incorporator, shareholder, officer or director, as
such, past, present or future, of the Company or any successor corporation,
whether by virtue of any constitution, statute or rule of law, or by the
enforcement of any assessment or penalty or otherwise, all such liability being,
by the acceptance hereof and as part of the consideration for the issue hereof,
expressly waived and released.

         10. The Holder of this Debenture, by acceptance hereof, agrees that
this Debenture is being acquired for investment and that such Holder will not
offer, sell or otherwise dispose of this Debenture or the Shares of Common Stock
issuable upon exercise thereof except under circumstances which will not result
in a violation of the Act or any applicable state Blue Sky law or similar laws
relating to the sale of securities.

         11. This Debenture shall be governed by and construed in accordance
with the laws of the State of Delaware, and shall be further subject to the
terms of the Agreement.

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                                    EXHIBIT A

                              NOTICE OF CONVERSION

                    (To be Executed by the Registered Holder
                       in order to Convert the Debenture)

         The undersigned hereby irrevocably elects to convert the above
Debenture No. ______________ into Shares of Common Stock of ClearLogic, Inc.
(the "Company") according to the conditions hereof, as of the date written
below.

                                       ---------------------------------------
                                       Date of Conversion*

                                       ---------------------------------------
                                       Applicable Conversion Price

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

                                       ---------------------------------------
                                       Name

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

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

* This original Debenture and Notice of Conversion must be received by the
Company by the second business day following the Date of Conversion.

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                                                                  EXHIBIT 10.5

                                CLEARLOGIC, INC.
                             1998 STOCK OPTION PLAN

1. Purposes of Plan.

         This 1998 Stock Option Plan (the "Plan") is designed to assist
ClearLogic, Inc. (the "Company") in attracting and retaining highly qualified
persons as employees of the company and its Subsidiaries in order to provide
such key employees with incentives to contribute to the growth and development
of the business of the Company.

2. Definitions.

         Unless the context otherwise indicates, the following terms have the
following meanings:

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

         "Code" means the Internal Revenue Code of 1986, as the same may from
time to time be amended.

         "Committee" means a committee consisting of at least three (3)
Disinterested Persons appointed by the Board to administer the Plan and to
perform the functions set forth herein.

         "Common Stock" means the Common Stock of the Company.

         "Designated Beneficiary" means the person designated by an optionee to
be entitled on his/her death to any remaining rights arising out of an option,
such designation to be made by written notice from the optionee to the Company
in accordance with such regulations as the Committee may create.

         "Disinterested Person" means a person (within the meaning of Rule 16b-3
under the Exchange Act) who at the time he/she exercises discretion as a member
of the Committee is not and at any time within one (1) year prior thereto, and
has not been eligible for selection (within the meaning of Rule 16b-3 of the
Exchange Act) as a person to whom shares of Common Stock may be allocated or to
whom stock options or stock appreciation rights may be granted pursuant to this
Plan or any other stock plan of the Company or any Subsidiary entitling

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participants therein to acquire stock, stock options or stock appreciation
rights of the Company or any Subsidiary.

         "Employee" means any employee (including any officer) of the Company or
any subsidiary of the Company.

         "Exchange Act" means the Securities Exchange Act of 1934, as Amended.

         "Fair Market Value" means the fair market value of the shares of Common
Stock as determined by the Committee in its sole discretion; provided, however,
that (A) if the shares are admitted to quotation on the National Association of
Securities Dealers Automated Quotation System ("NASDAQ") or other comparable
quotation system and have been designated as a National Market System ("NMS")
security, Fair Market Value on any date shall be the last sale price reported
for the shares on such system on such date or on the last day preceding such
date on which a sale was reported, (B) if the shares are admitted to quotation
on NASDAQ and have not been designated a NMS security, Fair Market Value on any
date shall be the highest bid and lowest asked prices of the shares on such
system on such date, or (C) if the shares are admitted to trading on a national
securities exchange, Fair Market Value on any date shall be the last sale price
reported for the shares on such exchange on such date or on the last date
preceding such date on which a sale was reported.

         "Incentive Stock Options" means stock options which constitute
incentive stock options within the meaning of Section 422A, or any successor
section, of the Code having the provisions specified for such incentive stock
options.

         "Parent" means "Parent Corporation" as defined in Section 425(e), or
any successor section, of the Code.

         "Stock Option Agreement" means a stock option agreement entered into
pursuant to the Plan substantially in the form of Exhibit "A" hereto.

         "Subsidiary" means "Subsidiary Corporation" as defined in Section
425(f), or any successor section, of the Code.

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         "Ten Percent Stockholder" means any person who immediately after any
option is granted to such person, owns within the meaning of Section 422A(b)(6),
or any successor section, of the Code, more than ten (10%) percent of the total
combined voting power of all classes of stock of the Company, its parent, if
any, or its Subsidiaries.

3. Stock Subject to Plan.

         The shares to be issued upon exercise of the options granted under the
Plan shall be Common Stock. The maximum number of shares shall be 2,000,000
shares, subject to adjustment as provided in Section 8 hereof. If any option
granted under the Plan shall expire or terminate for any reason whatsoever
without having been exercised in full, the unpurchased shares of Common Stock
previously subject to such option shall become available for new options.

4. Administration.

         (a) The Committee shall administer the Plan. The Board shall annually
appoint the members of the Committee at the annual organizing meeting of the
Board. The Committee shall consist of at least two members (one should be an
Outside Director (if there is such) selected by the Board of Directors, one of
who, if possible, shall be a Disinterested Person. Committee members may resign
by delivering written notice to the Secretary.

         (b) The Board shall fill all vacancies on the Committee and may remove
any member of the Committee at any time with or without cause. The Committee
shall select its own chairman and shall adopt, alter or repeal such rules and
procedures as it may deem proper and shall hold its meetings at such times and
places as it may determine. The Committee shall keep minutes of its meetings.
Action by a majority of the Committee members present at any meeting
at which a quorum is present, or action approved in writing by all members of
the Committee without a meeting, shall constitute the acts of the Committee.

                                       -3-

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         (c) Subject to the provisions of the Plan, the Committee shall have the
full and final authority to (i) determine the eligible employees of the Company
and its Subsidiaries to whom, and the times at which, options shall be granted
and the number of shares subject to each option; (ii) prescribe, amend and
rescind rules and regulations relating to the Plan; (iii) determine the
provisions of options granted under the Plan (which need not be identical) and,
with the consent of the holder thereof, amend or modify any option; (iv)
interpret the Plan and the respective options; and (v) make all other
determinations necessary or advisable for administering the Plan. All
determinations and interpretations by the Committee shall be binding upon all
parties. No member of the Committee or the Board shall be liable for any action
or determination made in good faith in respect of the Plan or any option granted
under it.

         (d) Should the Board fail to appoint the Committee or should there be
no Committee for any other reason, then the Board of Directors shall administer
the Plan. All action with respect to Options granted to any Officer or key
Employee who is subject to Section 16 of the Exchange Act shall be taken by the
Board of Directors if each member is a Disinterested Person, or if the entire
Board is not compromised of Disinterested Person, then by not less than two of
the Directors who are Disinterested Persons. In the absence of a Committee, the
Board of Directors (or that portion thereof comprised in accordance with Section
4(d)) shall have all the powers of the Committee as set forth herein in
administration of the Plan.

         (e) The provisions of this Section 4 shall survive any termination of
the Plan.

5. Eligibility for Awards of Options.

         (a) Options may be granted only to officers and other key employees of
the Company and its Subsidiaries. Any reference in the Plan to "employment by
the Company" shall also be deemed to include employment by any Subsidiary of the
Company. Determination by the Committee or the Board as to who are eligible
employees shall be conclusive.

         (b) A person who is a director of the Company shall not be considered
an officer or employee for the purpose of the Plan solely because he or she is a
director. However, a person who otherwise is an eligible officer or employee
shall not be disqualified by virtue of being a director of the Company or
Subsidiary.

                                       -4-

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         (c) More than one option may be granted to any eligible employee.

6. Option Price.

         (a) The Committee shall determine the purchase price of the Common
Stock under each option. The purchase price should be at least one hundred
(100%) percent of the Fair Market Value of the Common Stock. However, the
Committee can, under each option, determine the price of each option. The
purchase price under an option granted to an officer or employee who is a Ten
Percent Stockholder shall be at least 110% of the Fair Market Value of the
Common Stock of the Common Stock on the date of the grant of the option.

         (b) To the extent the aggregate Fair Market Value of Common Stock with
respect to which Incentive Stock Options (within the meaning of Section 422 of
the Code, but without regard to Section 422(d) of the Code) are exercisable for
the first time by an Optionee during any calendar year (under the Plan and all
other incentive stock option plans of the Company) exceeds $100,000, such
options shall be treated as Nonqualified Options. The rule set forth in the
preceding sentence shall be applied by taking Options into account in the order
in which they were granted. For purposes of this Section 6(b), the Fair Market
Value of Common Stock shall be determined as of the time the Option with respect
to such Common Stock is granted.

                                       -5-

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7.  Terms and Exercise of Option.

         (a) Maximum Ten-Year Termination Date. Each option shall expire no
later than ten years after the date on which it shall have been granted, but the
Committee in its discretion may prescribe a shorter period for any individual
option or options. Any option granted to a person who is a Ten (10%) Percent
Stockholder shall terminate no later than five years after the date on which the
option was granted. The date of termination pursuant to this paragraph is
referred to hereinafter as the "termination date of the option."

         (b) Vesting. Options shall be exercisable at such times and in such
installments, if any, as the Committee may determine. In the event any option is
exercisable in installments, any shares which may be purchased during any year
or other period which are purchased during such year or other period may be
purchased at any time or from time to time during any subsequent year or period
during the term of the option unless other wise provided in the Stock Option
Agreement.

         (c) Means of Exercise of Option. An option shall be exercised by
written notice to the Secretary or Treasurer of the Company at its then
principal office, which is received not later than 5:00 p.m. of the expiration
date. The notice shall specify the number of shares as to which the option is
being exercised and shall be accompanied by payment in full of the purchase
price for such shares. An optionee at his discretion may, in lieu of cash
payment, deliver Common Stock already owned, with a Fair Market Value (on the
date of the exercise) equal to the purchase price for the shares being acquired
pursuant to the exercise of the option, as payment for the exercise of the
option. In the event an option is being exercised in whole or in part, pursuant
to Section 7(f) or (g) hereof by any person other than the optionee, a notice of
election shall be accompanied by proof satisfactory to the Company of the rights
of such person to exercise said option. An optionee shall not, by virtue of the
granting of an option, be entitled to any rights of a shareholder in the
Company, and he or she shall not be considered a record holder

                                       -6-

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of shares purchased by him or her until the date on which he or she shall
actually be recorded as the holder of such shares upon the stock records of the
Company. The Company shall not be required to issue any fractional shares upon
exercise of any option and shall not be required to pay to the person exercising
the option the cash equivalent of any fractional share interest unless so
determined by the Committee.

         (d) Options Are Nontransferable. No option may be transferred by the
optionee (except in connection with death or disability as provided in Sections
7(f) and (g)).

         (e) Options Lapse Three Months after Termination of Employment. In the
event of the termination of an optionee's employment by the Company and its
Subsidiaries at any time for any reason (excluding disability or death), the
optionee's option and all rights thereunder shall expire three months after the
date of termination of employment. The option shall be exercisable by the
optionee at any time within the three months, but only to the extent exercisable
by the optionee on the date of termination of his or her employment.

         (f) Option Exercisable Six Months after Termination in Event of
Disability. In the event an optionee is permanently and totally disabled (within
the meaning of Section 105(d)(4), or any successor section, of the Code), the
optionee's option and all rights thereunder shall expire six months after the
date of termination of employment. The option shall be exercisable by the
optionee (or the optionee's legal representative) at any time within such six
months.

         (g) Option Exercisable Six Months after Date of Death. If an optionee
shall die while in the employ of the Company or any of its Subsidiaries, his
option may be exercised by his designated beneficiaries (or if none have been
effectively designated, by his executor, administrator or the person to whom his
rights under his option shall pass by his will or by the laws of descent and
distribution) at any time within six (6) months after the date of his death, but
only to the extent exercisable by the optionee at his death. The option shall
expire six months after the date of the optionee's death.

                                       -7-

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         (h) No Right to Continued Employment. Nothing in the Plan or in any
option granted pursuant hereto shall confer on any individual any right to
continue in the employ of the Company or any of its Subsidiaries or prevent or
interfere in any way with the right of the Company or its Subsidiaries to
terminate the optionee's employment at any time, with or without cause.

         (i) Writing Must Evidence Options. Each option granted pursuant to the
Plan shall be evidenced by a written Stock Option Agreement (see Exhibit "A"),
duly executed by the Company and the optionee, in such form and containing such
provisions as the Committee or Board may from time to time authorize or approve.

         (f) Withholding of Tax. The Company shall have the right to deduct from
any payment made under the Plan and federal, state or local income or other
taxes required by law to be withheld with respect to such payment. It shall be a
condition to the obligation of the Company to deliver Common Stock upon exercise
of an Option that the Optionee pay to the Company such amount as may be
requested by the Company for the purpose of satisfying any liability for such
withholding taxes. Any grant under this Plan may provide by its terms that the
Optionee may elect, in accordance with any applicable regulations, to pay a
portion or all of the amount of such minimum required or additional permitted
withholding taxes in shares of Common Stock (subject to: a written irrevocable
written election by the Optionee to use shares of the Company's Common Stock
issuable to the Optionee upon exercise of the Option to pay all or part of the
Option price or the withholding taxes (subject to the approval of the Committee)
made at least six months prior to the payment of such option price or
withholding taxes). The Optionee shall authorize the Company to withhold, or
shall agree to surrender back to the Company, on or about the date such
withholding tax liability is determinable, shares of Common Stock previously
owned by such Optionee pursuant to such award having a Fair Market Value equal
to the amount of such required or permitted withholding taxes to be paid in
shares.

         (g) Effect of Outstanding Child Support Obligations. Any option may not
be exercised during any time when the Optionee has been officially determined to
be delinquent in paying any judicially ordered child support in any State of the
United States.

                                       -8-

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8. Adjustments.

         The Stock Option Agreement shall contain appropriate provisions for the
adjustment of the kind and number of shares subject to each outstanding option,
and for the adjustment of the exercise price per share, in the event of any
changes in the outstanding Common Stock of the Company by reason of stock
dividends, stock splits, recapitalization, mergers, consolidations, combinations
or exchanges of shares, and the like. In the event of any such change or changes
in the outstanding Common Stock, except as set forth below, and as often as the
same shall occur, the kind and aggregate number of shares available under the
Plan shall be appropriately adjusted by the Board or Committee, whose
determination shall be binding and conclusive.

9. Amendments and Termination.

         (a) Unless the Plan shall have been sooner terminated as provided
herein, it shall terminate on, and no option shall be granted thereunder after
ten (10) years from the date the Plan is adopted by the Board of Directors; or
the expiration of ten (10) years from the date the Plan is approved by the
Company's stockholders. The Board may at any time prior to that date alter,
suspend or terminate the Plan as it may deem advisable, except that it may not
without further shareholder approval (i) increase the maximum number of shares
subject to the Plan (except for pursuant to Section 8), (ii) extend the period
during which options may be granted or exercised or (iii) make any other change
unless the Board determines that the change would not materially increase the
cost of the Plan to the Company. Except as otherwise hereinafter provided, no
alteration, suspension or termination of the Plan may, without the consent of
the employee to whom any option shall have theretofore been granted (or the
person or person entitled to exercise such option under Section 7(f) or (g) of
the Plan), terminate his/her option or adversely affect his rights thereunder.

                                       -9-

<PAGE>

         (b) Anything herein to the contrary notwithstanding, in the event that
the Board shall at any time declare it advisable to do so in connection with any
proposed sale or conveyance of all or substantially all of the assets of the
Company or of any proposed consolidation or merger of the Company, or tender
offer or exchange offer for the acquisition (directly or indirectly, by any
person or group) of all or a majority of the outstanding stock of the Company,
or if the stock of the Company are admitted to quotation on the National
Association of Securities Dealers Automated Quotation System ("NASDAQ") or other
comparable quotation system and have been designated as a National Market System
("NMS") security, Fair Market Value on any date shall be the last sale price
reported for the shares on such system on such date or on the last day preceding
such date on which a sale was reported, (B) if the shares are admitted to
quotation on NASDAQ and have not been designated a NMS security, Fair Market
Value on any date shall be the highest bid and lowest asked prices of the shares
on such system on such date, or (C) if the shares are admitted to trading on a
national securities exchange, the Company shall give written notice to the
holder of any option that all of his or her outstanding options may be exercised
only within thirty (30) days after the date of the notice, but not thereafter,
and all rights under said notice to fully vest which shall not have been so
exercised shall terminate at the expiration of such thirty (30) days, provided
that the proposed sale, conveyance, consolidation or merger to which such notice
shall relate shall be consummated within six (6) months after the date of such
notice. In the event such notice shall have been given, any such option may
exercised either in whole or in part notwithstanding the vesting period required
under the terms of the option for the exercise thereof. If such proposed sale,
conveyance, consolidation or merger shall not be consummated within said time,
no unexercised rights under any option shall be affected by such notice.
Notwithstanding any other provision of the Plan, all such option exercised under
this section, shall become effective after the date of the expiration of such
thirty (30) days and: (i) the fiftieth (50th) day prior to the effective date of
such merger, consolidation or similar transaction, sale, transfer or
acquisition; or (ii) the fiftieth (50th) day prior to the date of the merger,
consolidation or similar transaction, sale, transfer or acquisition.

                                      -10-

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10. Indemnification.

         Any member of the Committee or the Board who is made, or threatened to
be made, a party to any action or proceeding, whether civil, or criminal, by
reason of the fact that the member is or was a member of the Committee or the
Board insofar as relates to the Plan shall be indemnified by the Company, and
the Company may advance his related expenses, to the full extent permitted by
law or to any greater extent as provided in the Company's Certificate of
Incorporation or bylaws or in any agreement between the Company and the member.

11. Effective Date of the Plan.

         The Plan shall become effective on, and options may be granted
thereunder after November 2, 1998, provided, however, that if the Plan shall not
be approved by the holders of a majority of the outstanding voting stock of the
Company within 12 months of said date, the Plan and all options granted
thereunder shall be and become null and void, and provided, further, that no
options granted by the Committee may be exercised prior to the approval of the
Plan by shareholder.

12. Expenses.

         The Company shall pay all fees and expenses incurred in connection with
the establishment and administration of the Plan.

13. Government Regulations, Registration and Listing of Stock.

         (a) The Plan, and the grant and exercise of options thereunder, and the
Company's obligation to sell and deliver stock under such options, 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 be required.

                                      -11-

<PAGE>

         (b) Unless a registration statement under the Securities Act of 1933
and the applicable rules and regulations thereunder (collectively the "Act") is
then in effect with respect to shares issued upon exercise of any option (which
registration shall not be required), the Company shall require that the offer
and sale of such shares be exempt for the registration provisions for said Act.
In furtherance of such exemption, the Company may require, as a condition
precedent to the exercise of any option, that the person exercising the option
give to the Company a written representation and undertaking, satisfactory in
form and substance to the Company, that he or she is acquiring the shares for
his or her own account for investment and not with a view to the distribution or
resale thereof and otherwise establish to the Company's satisfaction that the
offer or sale of the shares issuable upon exercise of the option will not
constitute or result in any breach or violation of the Act or any similar state
act or statute or any rules or regulations thereunder. In the event a
Registration Statement under the Act is not then in effect with respect to the
shares of Common Stock issued upon exercise of an option, the Company shall
place upon any stock certificate an appropriate legend referring to the
restrictions on disposition under the Act.

         (c) In the event the class of shares issuable upon the exercise of any
option is listed on any national securities exchange, the Company shall not be
required to issue or deliver any certificate for shares upon the exercise of any
option prior to the listing of the shares so issuable on such national
securities exchange and prior to the registration of the same under the Exchange
Act or any similar act or statute.

14. Additional Provisions.

         (a) Duties of the Company. The Company shall, at all times during the
term of each Option, reserve and keep available for issuance or delivery such
number of shares of Common Stock as will be sufficient to satisfy the
requirements of all Options at the time outstanding, shall pay all original

                                      -12-

<PAGE>

issue taxes with respect to the issuance or delivery of shares pursuant to the
exercise of such Option and all other fees and expenses necessarily incurred by
the Company in connection therewith.

         (b) No Rights. No Employee shall have any claim or right to be granted
Options under the Plan. Both the adoption and maintenance of the Plan nor the
granting of Options pursuant to the Plan shall be deemed to constitute a
contract of employment between the Company and any Employee or to be a condition
of the employment of any person. The Plan and any Options granted under the Plan
shall not confer upon any Participant any right with respect to continued
employment by the Company, nor shall they interfere in any way with the right of
the Company to terminate the employment of any Participant at any time, and for
any reason, with or without cause, it being acknowledged, unless expressly
provided otherwise in writing, that the employment of any Participant is "at
will".

         (c) Controlling Laws. The granting of Options and the issuance of
shares of Common Stock under the Plan shall be subject to all applicable laws,
rules, and regulations, and to such approvals by any governmental agencies or
national securities exchanges as may be required. The provisions of this Plan
shall be interpreted so as to comply with the conditions and requirements of the
Securities Act, the Exchange Act, and rules and regulations issued thereunder,
including without limitation Rule 16b-3, unless a contrary interpretation of any
such provisions otherwise required by applicable law. Except to the extent
preempted by Federal law, this Plan and all Stock Option Agreements entered into
pursuant hereto shall be construed and enforced in accordance with, and governed
by, the laws of the State of New Jersey, determined without regard to its
conflict of laws rules, and jurisdiction shall be in County of Camden, State of
New Jersey.

         (d) No Obligation to Exercise. The granting of an Option shall impose
no obligation upon the Optionee to exercise such Option.

         (e) Language. Whenever the context so indicates, the singular or plural
number, and the masculine, feminine or neuter gender shall each be deemed to
include the other.

                                      -13-

<PAGE>

WHEREFORE, in accordance with the rules of incorporation of ClearLogic, Inc.,
and the by-laws of ClearLogic, Inc., and after a meeting, duly called, of the
directors and shareholders, we the members of the Board of Directors, having
carefully reviewed the proposed "ClearLogic, Inc. 1998 STOCK OPTION PLAN," and
with the approval of a majority of the current Shareholders of the Company, do
hereby ratify and adopt said plan.

IN WITNESS WHEREOF, the members of the Board of Directors and the shareholders
of ClearLogic, Inc. do hereby adopt the "ClearLogic, Inc. 1999 STOCK OPTION
PLAN" this 16th day of August, 1999.

The Board of Directors and Shareholders of
ClearLogic, Inc.

By: /s/ Sina Khelil                            /s/ Philip S. Burnham
    ---------------------------------          --------------------------------
    Sina Khelil, CEO and Shareholder           Witness

By: /s/ Douglas Schwarzwaelder                 /s/ Philip S. Burnham
    ---------------------------------          --------------------------------
    Douglas Schwarzwaelder, Director           Witness
    and Shareholder

By: /s/ Ronaldo Nascimento                     /s/ Philip S. Burnham
    ---------------------------------          --------------------------------
    Ronaldo Nascimento                         Witness
    Shareholder

By: /s/ Najat Khelil                           /s/ Philip S. Burnham
    ---------------------------------          --------------------------------
    Najat Khelil                               Witness
    Shareholder
                                       Dated this 16th day of August, 1999

                                               /s/ Philip S. Burnham
                                               --------------------------------

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

                                      -14-

<PAGE>

By: /s/ Jason Costomiris                       /s/ Philip S. Burnham
    ---------------------------------          --------------------------------
    Jason Costomiris                           Witness
    Shareholder

By: /s/ Mark Zelis                             /s/ Philip S. Burnham
    ---------------------------------          --------------------------------
    Mark Zelis                                 Witness
    Shareholder

                                       Dated this 16th day of August, 1999

                                               /s/ Philip S. Burnham
                                               --------------------------------

                                      -15-

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