Document:

<PAGE>

                                   LINEO, INC.

                       SAMSUNG ELECTRO-MECHANICS CO., LTD.

                     SAMSUNG VENTURE INVESTMENT CORPORATION

                                 LISTECH LIMITED

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

                             SHAREHOLDERS AGREEMENT

                                 WITH RESPECT TO

                                 LISTECH LIMITED

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

                         DATED AS OF SEPTEMBER 22, 2000

<PAGE>

                                TABLE OF CONTENTS

<TABLE>
<CAPTION>

                                                                                                               Page
                                                                                                               ----
<S>                                                                                                            <C>
ARTICLE 1. DEFINITIONS............................................................................................1

ARTICLE 2. ORGANIZATION; SUBSCRIPTION; GOVERNANCE.................................................................4
   2.1.      Organization.........................................................................................4
   2.2.      Subscription.........................................................................................4
   2.3.      Company Documents; Shares; Shareholders Meetings.....................................................4
   2.4.      Board of Directors...................................................................................5
   2.5.      Officers of the Company..............................................................................8
   2.6.      Confidentiality......................................................................................9

ARTICLE 3. RESTRICTIONS ON TRANSFER..............................................................................10
   3.1.      General.............................................................................................10
   3.2.      Right of First Refusal..............................................................................10
   3.3.      Legends.............................................................................................11
   3.4.      Rights of Future Holders and Transferees............................................................12
   3.5.      Liquidated Damages..................................................................................12

ARTICLE 4. REPRESENTATIONS AND WARRANTIES OF SHAREHOLDERS........................................................12
   4.1.      Representations and Warranties of Shareholders......................................................12
   4.2.      Representations and Warranties of Samsung...........................................................13
   4.3.      Representations and Warranties of Lineo.............................................................13

ARTICLE 5. BUSINESS PLAN AND CAPITAL CONTRIBUTIONS...............................................................13
   5.1.      Business Plan.......................................................................................13
   5.2.      No Further Capital Contributions....................................................................14
   5.3.      Dividend Policy.....................................................................................14

ARTICLE 6. OTHER AGREEMENTS OF THE COMPANY AND THE SHAREHOLDERS..................................................14
   6.1.      Accession of the Company............................................................................14
   6.2.      Agreements of the Company...........................................................................14
   6.3.      Management Reports; Access and Information..........................................................15
   6.4.      Governmental Approvals..............................................................................15
   6.5.      New Shareholders....................................................................................16
   6.6.      IPO.................................................................................................16
   6.7.      *

ARTICLE 7. DEADLOCK..............................................................................................16

ARTICLE 8. TERM, EXPIRATION AND TERMINATION OF THE AGREEMENT.....................................................17
   8.1.      Term; Expiration....................................................................................17
   8.2.      Termination of the Agreement........................................................................17

ARTICLE 9. ARBITRATION...........................................................................................18
   9.1.      Dispute Resolution..................................................................................18

                                      -i-

*MATERIAL HAS BEEN OMITTED PURSUANT TO A REQUEST FOR CONFIDENTIAL TREATMENT,
AND SUCH MATERIAL HAS BEEN FILED SEPARATELY WITH THE SEC.

<PAGE>

   9.2.      Specific Performance................................................................................18

ARTICLE 10. MISCELLANEOUS........................................................................................18
   10.1.     Assignment, Etc.....................................................................................19
   10.2.     Notices.............................................................................................19
   10.3.     Costs and Expenses..................................................................................20
   10.4.     No Waiver...........................................................................................20
   10.5.     Amendment...........................................................................................20
   10.6.     Third Parties.......................................................................................20
   10.7.     Headings............................................................................................20
   10.8.     Governing Law.......................................................................................20
   10.9.     Entire Agreement....................................................................................20
   10.10.    Invalidity..........................................................................................21
   10.11.    Counterparts........................................................................................21
   10.12.    Language............................................................................................21
   10.13.    Further Assurances..................................................................................21
   10.14.    Conflicts...........................................................................................21

</TABLE>

                                      -ii-
<PAGE>

                             SHAREHOLDERS AGREEMENT

This SHAREHOLDERS AGREEMENT, dated as of September 22, 2000 (this "AGREEMENT"),
is entered into among

(1)  Lineo, Inc., a Delaware corporation ("LINEO");

(2)  Samsung Electro-Mechanics Co., Ltd., a Korean corporation ("SEMCO"); and

(3)  Samsung Venture Investment Corporation, a Korean corporation ("SVIC"; SEMCO
     and SVIC are herein jointly and severally referred to as "SAMSUNG").

Lineo and Samsung, together with their permitted transferees and assigns and any
permitted successors to their interest in any Shares, are hereinafter referred
to collectively as the "SHAREHOLDERS" and individually as a "SHAREHOLDER".

                                R E C I T A L S:

A.   Samsung and Lineo have agreed to form Listech Limited, a Korean corporation
     (the "COMPANY") as a joint venture in order to combine their experience,
     technological and management expertise, and financial commitment and
     resources for purposes of developing and selling various products of
     embedded and/or realtime application including Linux (based on Lineo's
     software products), RTOS and embedded software worldwide;

B.   The Company will be established to serve as the joint venture company for
     the purposes described above;

C.   The Shareholders and the Company believe that it is in their best interest
     and in the best interest of the Company to set forth in this Agreement
     certain agreements with respect to the management of the Company and the
     voting of the Shares and to impose certain restrictions on any disposition
     of the Shares;

NOW, THEREFORE, in consideration of the premises and the mutual covenants herein
contained, the parties hereto agree as follows:

                             ARTICLE 1. DEFINITIONS

     As used in this Agreement, the following terms have the respective meanings
set forth below or set forth in the respective paragraphs or Sections referred
to with respect to such terms, and such definitions shall be applicable to the
singular and plural forms of such terms.

     "AFFILIATE" means, with respect to any specified Person, any other Person
controlling, controlled by, or under common control with, such specified Person.
For purposes hereof, "control" means, with respect to any Person, the power to
elect a majority of members to the board of directors, management committee or
other managing body of such Person or to direct the management or affairs of any
Person, whether through the ownership of equity or other

<PAGE>
SHAREHOLDERS AGREEMENT                                                    PAGE 2

rights, by contract or arrangement or otherwise. A wholly-owned Affiliate means,
with respect to any person, any direct or indirect wholly-owned subsidiary of
such person, or any direct or indirect wholly-owned subsidiary of any parent
company that wholly-owns such person. Any company which is deemed to be a member
of the Samsung Group under the regulations of the Korean Fair Trade Commission
shall be deemed to be an Affiliate of SEMCO and SVIC.

     "ANNUAL BUSINESS PLAN" has the meaning specified in Section 5.1(b).

     "AOI" means the AOI of the Company, in the form to be agreed by the
Shareholders under Section 2.1, as adopted and amended from time to time by
agreement of the Shareholders.

     "BOARD OF DIRECTORS" means the board of directors of the Company.

     "BUSINESS DAY" means, in any specified location, any day other than a
Saturday or Sunday or other day on which banks in such location are required or
authorized by law or regulation to be closed.

     "BUSINESS PLAN" has the meaning specified in Section 5.1(b).

     "COMPANY" has the meaning specified in the first paragraph of this
Agreement.

     "COMPANY BUSINESS" means business and operations of the Company as
contemplated by, and in accordance with, the current Business Plan in effect.

     "COMPETING BUSINESS" means the development and marketing of embedded
software solutions for device manufacturers and other original equipment
manufacturers (OEMs).

     "EFFECTIVE DATE" of this Agreement means the date on which all of the
following have occurred: (i) this Agreement has been executed and delivered by
each of Lineo, SEMCO and SVIC; and (ii) this Agreement has been approved by the
board of directors of each of Lineo, SEMCO and SVIC.

     "FIELD OF ACTIVITY" means the purpose and scope of business of the Company
as defined in the AOI which shall consist of the development and sale of various
products of embedded and/or realtime application including Linux (based on
Lineo's software products), RTOS and embedded software, distribution and sale of
such products and/or third party products and maintenance thereof in the
worldwide market.

     "GOVERNMENTAL AUTHORITY" means any central, regional, provincial, municipal
or other governmental authority, including any executive, legislative or
judicial branch thereof and any agency, department, commission, bureau or
instrumentality thereof.

     "GROUP COMPANY" means the Company and any Subsidiary of the Company.

     "INITIAL BUSINESS PLAN" has the meaning specified in Section 5.1(a).

     "IPO" means, with respect to the Company, the first sale, whether primary,
secondary, or a combination of both, of its shares pursuant to a public offering
on the Korea Stock Exchange, the Korean Securities Dealers Quotation System
(Kosdaq), or another recognized securities

<PAGE>
SHAREHOLDERS AGREEMENT                                                    PAGE 3

exchange outside Korea, where "public offering" means any widely dispersed,
underwritten offering open to the public on any such exchange.

     "KOREA" means the Republic of Korea.

     "KRW" means the lawful currency of Korea.

     "LICENSE AGREEMENT" means a license agreement to be entered into by Lineo
as licensor and the Company as licensee. The current form of the License
Agreement is attached hereto as Exhibit 1. The parties will negotiate a final
License Agreement according to the Schedule attached hereto as Exhibit 2.

     "LIEN" means any lien, charge, pledge, encumbrance, security interest,
mortgage, title retention or other similar agreement or arrangement.

     "LINEO" has the meaning attributed thereto in the first paragraph of this
Agreement.

     "PERSON" means any natural person, corporation, partnership, joint venture,
trust, association or other legal entity.

     "REORGANIZATION" means any increase, consolidation and division, conversion
into stock or re-conversion of stock into shares, subdivision, capitalization,
cancellation or redemption of any shares in a Group Company or any purchase by a
Group Company of its own shares or any alteration of any of the rights of any of
the share capital of a Group Company or any amalgamation or reconstruction
affecting its share capital or any compromise or arrangement with creditors
(including a "workout" procedure with creditors in Korea).

     "SAMSUNG" has the meaning attributed thereto in the first paragraph of this
Agreement.

     "SHAREHOLDER" has the meaning attributed thereto in the first paragraph of
this Agreement; except where the context otherwise requires, a reference to a
Shareholder herein shall be deemed to refer to SEMCO and SVIC, jointly and
severally, on the one hand, or to Lineo, on the other, together with any
permitted transferees of Shares by SEMCO and SVIC, jointly and severally, on the
one hand, or permitted transferees of Shares by Lineo, on the other. The term
"Shareholder" shall not include holders of Shares (other than permitted
transferees of the Shareholders) who acquire such Shares after the acquisition
by the Shareholders of Shares under Article 2.

     "SHARES" means, at any time, the ordinary shares of the Company issued and
outstanding at such time.

     "SUBSIDIARY" means any Person directly or indirectly owned or controlled by
the Company. For purposes hereof, the term "control" means, with respect to any
Person, the power to elect a majority of members to the board of directors,
management committee or other managing body of such Person or to direct the
management or affairs of any Person, whether through the ownership of equity
shares or securities or other rights, by contract or arrangement or otherwise.

<PAGE>
SHAREHOLDERS AGREEMENT                                                    PAGE 4

     "US DOLLARS" or "US$" means United States dollars, the lawful currency of
the United States of America.

               ARTICLE 2. ORGANIZATION; SUBSCRIPTION; GOVERNANCE

     2.1. ORGANIZATION

     As promptly as practicable following the Effective Date, the Shareholders
shall agree upon the AOI of the Company in a manner consistent with the terms of
this Agreement and shall cause the Company to be formed in accordance with
Korean law and to adopt the AOI. Immediately after its formation, the
Shareholders shall cause the Company to execute and become a party to this
Agreement.

     2.2. SUBSCRIPTION

     (a) Based on the respective representations, warranties and agreements of
the parties set forth below, each of Lineo and Samsung hereby subscribes for and
purchases the following Shares, to be issued within five Business Days after the
organization of the Company for the consideration specified below:

<TABLE>
<CAPTION>

                                            Initial  Share             Subscription
         Shareholder       No. of Shares.   Percentage                 Price
         -----------       --------------   --------------     ----------------------------
         <S>               <C>               <C>               <C>
         Lineo              240,000           57.14%           W5,000/share(W1,200,000,000)
         SEMCO               90,000           21.43%           W5,000/share  (W450,000,000)
         SVIC                90,000           21.43%           W5,000/share  (W450,000,000)

</TABLE>

     (b) Lineo's payment of the subscription price for the Shares shall take
place in accordance with the schedule attached hereto as Exhibit 2. The Schedule
includes a form of purchase order, which the parties shall cause the Company to
execute upon formation of the Company. The first payment due under the purchase
order shall be made in accordance with the purchase order included as part of
Exhibit 2.

     2.3. COMPANY DOCUMENTS; SHARES; SHAREHOLDERS MEETINGS

     (a) The Company shall call regular meetings of Shareholders in the manner
provided in the AOI, but not less frequently than once each year. Notices of the
date and agenda for each regular meeting of Shareholders shall be provided by
the Company to each Shareholder at least 15 days prior to such meeting. Special
meetings of Shareholders may be called by the Chairman of the Company or any
Shareholder by notice thereof to the Shareholders delivered at least 10 days
prior to such meeting.

     (b) A quorum of Shareholders shall be constituted for any meeting of the
Shareholders by the presence thereat (in person or by proxy) by Shareholders
holding two-thirds of all issued and outstanding Shares.

<PAGE>
SHAREHOLDERS AGREEMENT                                                    PAGE 5

     (c) To the extent permitted by applicable law, Shareholders and their
proxies may participate in any meeting of Shareholders by telephone, video
conferencing or other means by which all participants may speak and hear each
other, and any Shareholder so participating shall be deemed to be present at any
such meeting for all purposes.

     (d) Notice of any meeting of Shareholders shall be properly given if
delivered to the address or in the manner specified below in Section 10.2 or at
such other address specified by such Shareholder for notices from time to time
pursuant to Section 10.2.

     2.4. BOARD OF DIRECTORS

     (a) The Board of Directors shall consist of five members.

     (b) Subject to Section 2.4(c), three directors shall be nominated by Lineo
and two directors shall be nominated by Samsung. Lineo and Samsung shall
nominate each of their respective directors within 10 days of the date of this
Agreement. After the Closing, the respective rights of the Shareholders with
respect to the election of directors shall be governed by the AOI and the
provisions of this Section 2.4.

     (c) If at any time Lineo, on the one hand, or Samsung, on the other, shall
own less than 10% of the outstanding Shares, (i) such Shareholder shall cause
its nominees to the Board of Directors to resign, and (ii) all members of the
Board of Directors shall be elected by the majority vote of the outstanding
Shares present at a meeting of Shareholders at which a quorum is present or by
unanimous written consent.

     (d) Upon the death, resignation or incapacity of any director, the
Shareholder who nominated such director pursuant to Section 2.4(b) shall be
entitled to nominate his replacement to the Board of Directors, and all of the
Shareholders shall vote all Shares owned by them in favor of the appointment of
such nominee to the Board of Directors in order to fill the vacancy created by
such death, resignation or incapacity. Any director shall be removed from office
upon motion by the Shareholder that nominated him as of right pursuant to
Section 2.4(b), and the vacancy on the Board of Directors so created by such
removal shall be filled by a nominee nominated by such Shareholder. No director
appointed by any Shareholder as of right pursuant to Section 2.4(b) shall be
removed from the Board of Directors unless the nominating Shareholder consents
to such removal. Notwithstanding anything to the contrary contained in this
Section 2.4, if at any time the total number of Shares owned by a Shareholder
together is less than 10% of the outstanding Shares, the directors nominated by
such Shareholder shall be removed from office upon motion by the other
Shareholder and the vacancy on the Board of Directors created by such removal
shall be filled by a nominee of the other Shareholder.

     (e) The persons nominated to the Board of Directors in accordance with this
Section 2.4 shall be elected to the Board of Directors by the Shareholders, and
each Shareholder agrees to vote all Shares owned by it in favor of the election
of the persons so nominated. Upon a motion to remove any director in accordance
with Section 2.4(d), each Shareholder agrees to vote all Shares owned by it to
effect removal of such directors.

     (f) Regular meetings of the Board of Directors shall be called by the
Chairman or President of the Company not less frequently than six times each
year during the first year of operation of the Company and not less than four
times each year thereafter.

<PAGE>
SHAREHOLDERS AGREEMENT                                                    PAGE 6

     (g) The Board of Directors shall manage the business of Company and may
exercise all powers normally exercised by a Board of Directors, except for such
powers as are required to be exercised by Shareholders, all in accordance with
the AOI and applicable law. All actions by the Board of Directors shall require
the affirmative vote of a majority of the members of Board of Directors present
at a meeting at which a quorum is present, except for such actions as to which a
super-majority vote is required pursuant to Section 2.4(k), the AOI or
applicable law. A quorum of the Board of Directors must include at least one
member nominated by Lineo and one member nominated by Samsung.

     (h) The Company shall form an Executive Committee for review and decision
of on-going business matters on a timely fashion. The Executive Committee of the
Board of Directors shall consist of the President/Chief Executive Officer and
one of the directors nominated by Lineo. The Executive Committee shall have the
authority to make any decisions, by unanimous consent of the members, to the
extent permitted by the AOI and applicable law, of such matters as may be
delegated to it from time to time by resolution of the Board of Directors,
including the following:

       (i)    Establishment of policies and/or regulations regarding personnel
              management, administration and operation of the Company;

       (ii)   Approval of any contract to which the Company is a party involving
              an amount in excess of W100,000,000 but less than W500,000,000
              during the term of the contract, and any other contract with a
              term of one year or more and less than three years;

       (iii)  Preparation of a plan for compensation, including salaries,
              bonuses and incentive compensation to be received by the employees
              of the Company, other than directors and officers;

       (iv)   The establishment or modification of the Company's proposed annual
              budget for consideration by the Board of Directors;

       (v)    The recommendation to the Board of Directors of appropriate
              bookkeeping and accounting policies, including the selection of
              the Company's outside auditor; and

       (vi)   Except for the License Agreement, entry by the Company into any
              agreement with any Shareholder or any Affiliate of any Shareholder
              with respect to any transaction less than W1,000,000 per occasion,
              and less than W1,000,000,000 in annual aggregate, in the ordinary
              course of the Company's business.

Regular meetings of the Executive Committee may be held at such time and place
as shall from time to time be fixed by the Executive Committee and no notice
thereof shall be required, provided that both members are in attendance.

     (i) To the extent now or hereafter permitted by applicable law, directors
may participate in any meeting of the Board of Directors by telephone or video
conferencing, and any director so participating shall be deemed to be present at
any such meeting for all purposes.

<PAGE>
SHAREHOLDERS AGREEMENT                                                    PAGE 7

     (j) Notices of all meetings of the Board of Directors shall be properly
given if delivered to directors at least five Business Days prior to such
scheduled meeting date by courier or facsimile. Any notice to any director
nominated by any Shareholder shall be properly given if sent to such Shareholder
at the address specified in Section 9.2 or at such other address specified by
such Shareholder for notices or to such address as such director shall specify
in writing to the Company from time to time.

     (k) ACTIONS REQUIRING SUPER-MAJORITY CONSENT: Notwithstanding anything
contained in the AOI or elsewhere in this Agreement to the contrary, the Company
shall not take any of the following actions without obtaining the consent of at
least four directors:

       (i)    Adoption of the Business Plan and any material modifications
              thereto or entering into any business outside of the Field of
              Activity;

       (ii)   Any lending, borrowing, guarantee or creation of any financial
              obligation, whether secured or not, upon all or any part of the
              assets of the Company, exceeding W800,000,000;

       (iii)  Acquisition, mortgage, pledge, sale, assignment, transfer or other
              disposition of any property of the Company having a fair market
              value in excess of W800,000,000 (other than the sale of products
              and services in the ordinary course of business) or any interest
              of the Company (regardless of value) in the legal or beneficial
              ownership of any other corporation or enterprise;

       (iv)   Any capital expenditure in excess of W800,000,000;

       (v)    Approval of any investment in or any loan to any other persons or
              entities;

       (vi)   Issuance, repurchase or redemption of any equity or debt
              securities or instruments issued by the Company;

       (vii)  Recommendation to the shareholders of any increase or decrease in
              the authorized capital of the Company;

       (viii) Increase or reduction of the capital of the Company including
              issuance of new stock by transferring legal reserves into paid-in
              capital, stock splits, or issuance of any debentures or
              convertible debentures;

       (ix)   Merger into or with, or acquisition of all or a portion of the
              business of, any other person or entity, or transfer in any one
              transaction or series of transactions all or a substantial portion
              of the Company's business or assets;

       (x)    Dissolution, liquidation, or entering into any reorganization,
              composition or voluntary bankruptcy proceedings;

       (xi)   Fixing the compensation of the directors and officers of the
              Company, including bonuses;

<PAGE>
SHAREHOLDERS AGREEMENT                                                    PAGE 8

       (xii)  Approval of the execution of any contract which has a term of
              three years or more, or which involves an amount of W800,000,000
              or more during the term of the contract;

       (xiii) Recommendation to the shareholders any change in the AOI;

       (xiv)  Approval of transactions of the Company with any Director; or

       (xv)   Approval of transactions of the Company with any Shareholder
              (other than pursuant to the License Agreement) in excess of the
              levels set forth in Section 2.4(h)(vi).

     2.5. OFFICERS OF THE COMPANY

     (a) Subject to Section 2.5(c), the officers of the Company shall be
appointed from time to time by the majority vote of those present at any meeting
of the Board of Directors duly called and held at which a quorum is present or
by the unanimous written consent of the Board of Directors.

     (b) Each officer shall have the powers and fulfill the duties assigned to
such office by the Board of Directors and otherwise prescribed therefor in the
AOI of the Company. Nothing in this Section 2.5 shall limit the right of the
Board of Directors to determine or to amend from time to time the duties of any
officer or member of senior management of the Company or any Subsidiary.

     (c) From time to time during the term of this Agreement, Lineo shall have
the right to nominate, remove and renominate from time to time individuals to
occupy the offices of Chairman Representative Director and Chief Financial
Officer or Executive Vice President, and Samsung shall have the right to
nominate, remove and renominate from time to time individuals to occupy the
offices of President/Chief Executive Officer Representative Director and Chief
Technical Officer of the Company, and each Shareholder shall vote, or shall
cause its nominees to the Board of Directors to vote, in favor of the
appointment of any such individuals so nominated, removed or renominated.

     (d) The Shareholders agree that, from the date of this Agreement until the
first regular meeting of the Board of Directors or unanimous consent of the
Board of Directors in lieu of a meeting, in either case, at which officers are
appointed, each of the following positions shall be appointed for the respective
office set forth below, by the parties set forth below, with such appointments
to occur within 10 days of the date of this Agreement:

                  OFFICE
                  ------
                  Chairman/Representative Director (Lineo)
                  President/CEO/Representative Director (Samsung)
                  Chief Financial Officer or Executive Vice President (Lineo)
                  Chief Technical Officer (Samsung)

Each of the foregoing persons shall perform the functions and duties normally
associated with such office or as otherwise specified by the Board of Directors.
The execution, delivery and

<PAGE>

SHAREHOLDERS AGREEMENT                                                    PAGE 9

performance by the Company of this Agreement and the License Agreement is hereby
approved, and any of the officers of the Company specified above is hereby
authorized to execute and deliver this Agreement and the License Agreement on
behalf of the Company.

     2.6. CONFIDENTIALITY

     (a) At all times during the term of this Agreement, each Shareholder shall
keep, and shall cause, its agents and representatives (collectively the
"REPRESENTATIVES" of such Shareholder) to keep, all Confidential Information
strictly confidential and will not, directly or indirectly, disclose, use or
exploit such information for any purpose other than the good faith management of
the business and affairs of the Company and the Subsidiaries. As used herein,
"CONFIDENTIAL INFORMATION" means any information, documents or data in any form
that may contain non-public information relating to the Company, any Subsidiary,
any Shareholder or any Affiliate of any Shareholder or the business affairs
thereof, including technical information, data, processes and methodologies,
trade secrets, market analyses, pricing information, customer lists, research,
software, general know-how, designs and commercial and other proprietary or
confidential information or data and any financial results or information;
PROVIDED, HOWEVER, that "CONFIDENTIAL INFORMATION" does not include information
that is within the public domain (other than as a result of a breach of
obligations of Confidentiality), or information that was known by a party prior
to the disclosure thereof by the Company or a Subsidiary so long as such party
can provide reasonably satisfactory evidence of such prior knowledge. The
parties acknowledge that certain Confidential Information may be contained in,
or disclosed pursuant to, applications for Governmental Approvals. The parties
agree that the Company may make such disclosures to the extent the Company
reasonably determines such disclosure to be beneficial to the conduct or
objectives of the Company Business; PROVIDED, HOWEVER, that the Company shall,
to the extent permitted and practicable, use its best endeavors to cause such
Confidential Information to be treated confidentially.

     (b) Except for disclosure by a Shareholder to such Shareholder's
accountants, tax advisers and employees who have a need to know such
information, no Shareholder shall disclose or shall permit any of its
Representatives to disclose any Confidential Information to any person or
entity, and any disclosure by a Shareholder of any Confidential Information to
any accountant, tax adviser or employee will be made only after such persons
have been advised of the confidential nature of such information and have agreed
to maintain its confidentiality.

     (c) Nothing in this Agreement shall prevent any party from disclosing any
Confidential Information (i) to the extent required by law, rule or regulation
(including the regulations of and agreements with securities regulatory
authority or any stock exchange on which the securities of such party or its
Affiliates may be listed), (ii) as necessary in connection with any arbitration
proceeding or legal action between the parties, or (iii) as reasonably necessary
to effect a sale of its interest in the Company in accordance with the terms of
this Agreement; PROVIDED, HOWEVER, that, in the case of any disclosure pursuant
to clause (iii), the party seeking to disclose such information shall inform the
Company and the other Shareholders thereof and shall obtain from the party to
whom such disclosure is proposed to be made a confidentiality agreement in form
and substance reasonably prescribed by the Board of Directors.

<PAGE>
SHAREHOLDERS AGREEMENT                                                   PAGE 10

     (d) Neither the Shareholders nor the Company shall issue a press release or
other public announcement of the transactions or relationship contemplated
hereby or the investment by any party in the Company or the Company Business
without the consent of the other parties, which consent shall not be
unreasonably withheld or delayed. Each party shall cooperate with respect to the
content of any such press release or public announcement and coordinate the
release or dissemination thereof with the other parties.

                      ARTICLE 3. RESTRICTIONS ON TRANSFER

     3.1. GENERAL

     (a) The Shareholders agree that during the term of this Agreement, no
Shareholder shall sell, exchange, assign, transfer, pledge, hypothecate or
otherwise encumber or permit to be encumbered, give or otherwise dispose of,
whether any such disposition shall be voluntary or involuntary or come about or
be effected by operation of law or pursuant to or in compliance with any
judgment, order, rule or regulation of any administrative body (any of said acts
being hereinafter referred to as "DISPOSED OF" or as a "DISPOSITION") any of the
Shares now or hereafter owned by such Shareholder, except in accordance with the
provisions of this Agreement, and the Company agrees that it will not transfer
or recognize any disposition of Shares except in compliance with this Agreement.
Notwithstanding anything to the contrary in this Agreement, no Shareholder shall
dispose of any Shares to any Person engaged in, or having any ownership interest
in, a Competing Business.

     (b) A Shareholder (the "TRANSFEROR") may transfer any Shares owned by it to
any wholly-owned Affiliate of such Transferor; PROVIDED, HOWEVER that (i) upon
and after such transfer, the Transferor shall remain liable to cause the
transferee Affiliate to perform and observe all of the agreements of the
Transferor under this Agreement; (ii) the Transferor shall be deemed to have
retained the right to re-acquire the Shares so transferred to such transferee
Affiliate without consideration, which right shall be deemed automatically
exercised upon any divestiture by such Transferor of a controlling interest in
such transferee Affiliate; and (iii) such transferee Affiliate shall, at the
time of such transfer, furnish a written agreement to and for the benefit of
each of the parties to this Agreement pursuant to which such transferee
acknowledges and agrees to the provisions of this clause.

     (c) During the period from the Effective Date until the completion of the
IPO of the Company, no Shareholder shall dispose of any Shares without the prior
written consent of the other Shareholder, except to an Affiliate pursuant to
Section 3.1(b).

     3.2. RIGHT OF FIRST REFUSAL

     (a) Subject to Sections 3.1(a), 3.1(b), 3.1(c) and 3.2(e), if prior to the
IPO of Shares of the Company either Shareholder or any permitted transferee
thereof (herein, the "OFFEROR") agrees upon or enters into a BONA FIDE
arrangement with a third party (a "THIRD PARTY PURCHASER") to sell or make any
other disposition (not including a prohibited pledge, hypothecation or other
encumbrance) to such Third Party Purchaser all or a portion of the Shares of
such Offeror, then the Offeror shall first offer such Shares (the "OFFERED
SHARES") to the other Shareholder (the "OFFEREE"). Such offer shall be made by
written notice (the "OFFER NOTICE")

<PAGE>
SHAREHOLDERS AGREEMENT                                                   PAGE 11

delivered to the Offeree and specifying the number of Offered Shares, the
offering price per share offered to and agreed upon by the Third Party Purchaser
and the Offeror and any other terms and conditions of such offer that were
agreed upon by the Third Party Purchaser and the Offeror. If any part of the
price contemplated to be paid by the Third Party Purchaser to purchase the
Offered Shares consists of property or assets other than cash, then the Offer
Notice shall also set forth such Offeror's good faith and reasonable estimate of
the cash value of such consideration and the manner by which such estimate was
determined.

     (b) The Offeree shall have the right (a "RIGHT OF FIRST REFUSAL") to accept
such offer and to purchase (itself or through an Affiliate) all, but not less
than all, of such Offered Shares at the price and upon the terms and conditions
set forth in such Offer Notice.

     (c) Within 30 days after its receipt of the Offer Notice (the "NOTICE
PERIOD"), the Offeree shall respond to the Offeror by giving the Offeror written
notice (a "REPLY NOTICE") specifying whether the Offeree intends or declines to
exercise the Right of First Refusal. If the Offeree specifies in its Reply
Notice that it intends to exercise the Right of First Refusal (an "ACCEPTANCE
NOTICE"), then a binding agreement for the sale and purchase of the Offered
Shares at the cash price (including the cash value of any property as estimated
reasonably and in good faith pursuant to the last sentence of Section 3.2(a))
and on the terms and conditions set forth in the Offer Notice shall
automatically be deemed to exist between the Offeror and the Offeree, and such
sale and purchase shall be consummated no later than 30 calendar days after the
delivery of such Acceptance Notice (the "COMPLETION DATE").

     (d) If the Offeree has not delivered a Reply Notice to the Offeror or if,
because of the actions or inactions of the Offeree, the purchase and sale has
not occurred within the 30-day period contemplated by clause (c) above, then the
Offeree shall be deemed to have waived its Right of First Refusal and the
Offeror shall have the right to sell the Offered Shares to the Third Party
Purchaser upon the terms and conditions set forth in the Offer Notice; PROVIDED
that such sale and purchase is consummated (i) within 15 days following the last
day of the Notice Period or, (ii) if a Completion Date has been determined,
within 15 days following such Completion Date.

     (e) Notwithstanding the foregoing, (i) the disposition of Shares by a
Shareholder to an Affiliate pursuant to Section 3.1(b) shall not be subject to
the Right of First Refusal of the other Shareholder hereunder, and (ii) a
Shareholder shall not have a Right of First Refusal in respect of a Change in
Control Transaction (as defined in Section 3.3).

     (f) In connection with any such disposition of Shares pursuant to this
Section 3.2, the disposing Shareholder or such Affiliate shall deliver to the
other Shareholder a true and complete copy of all agreements relating to such
transaction in order to enable the other Shareholder to verify compliance with
this Section 3.2. The other Shareholder shall treat such agreements and their
contents as Confidential Information.

     3.3. LEGENDS

     Each certificate representing Shares shall have endorsed on it the
following legend, in Korean and English:

<PAGE>
SHAREHOLDERS AGREEMENT                                                   PAGE 12

          THE SHARES REPRESENTED BY THIS CERTIFICATE HAVE NOT BEEN
          REGISTERED UNDER THE SECURITIES LAWS OF ANY COUNTRY.

          THE SALE, TRANSFER, PLEDGE OR OTHER DISPOSITION OF THE SHARES
          REPRESENTED BY THIS CERTIFICATE IS RESTRICTED BY, AND SUCH SHARES
          ARE SUBJECT TO THE PROVISIONS OF, THE SHAREHOLDERS AGREEMENT DATED
          AS OF SEPTEMBER 22, 2000, A COPY OF WHICH IS ON FILE AT THE OFFICE
          OF THE COMPANY AND THE PROVISIONS OF WHICH ARE INCORPORATED HEREIN
          BY REFERENCE.

     3.4. RIGHTS OF FUTURE HOLDERS AND TRANSFEREES

     Automatically upon the transfer of Shares or upon the occurrence of any
other permitted transfer or issuance of Shares hereunder, the purchaser or
acquirer of such Shares shall become a "Shareholder" within the meaning of this
Agreement, and shall become entitled to the rights and benefits, and subject to
the terms, conditions and restrictions set forth in this Agreement. Any such
purchaser or acquirer of Shares (including any Affiliate of any Shareholder that
acquires any Shares) and the transferor Shareholder thereof shall be required,
as a condition precedent to such transfer, to execute and deliver a joinder
agreement in such form as shall be prescribed by the Board of Directors of the
Company pursuant to which (i) such purchaser or acquirer agrees to assume and to
be bound by all of the obligations and terms of this Agreement, and (ii) the
transferor Shareholder agrees to remain liable for any actions or events
occurring prior to the date of transfer and to indemnify the Company for any
costs or taxes relating to such transfer.

     3.5. LIQUIDATED DAMAGES

     If a Shareholder makes a disposition of shares in violation of the
provisions of this Article 3, such Shareholder shall pay to the other
Shareholder, on demand, as liquidated damages and not as a penalty, an amount
equal to the greater of (i) 50% of the price at which such shares were sold and
(ii) 200% of the net asset value of such shares based on the most recent
available audited financial statement of the Company. The non-breaching
Shareholder may in its discretion in addition to exercising its rights under
this Article 3 treat such sale as a material breach hereof, terminate this
Agreement and pursue such party's remedies under Article 9. The Shareholders
acknowledge that it will be difficult or impossible to ascertain the precise
amount of damages resulting from a default under this Article 3, and agree that
the amount set forth herein represents a fair and reasonable estimate thereof
and constitutes liquidated damages and not a penalty.

     ARTICLE 4. REPRESENTATIONS AND WARRANTIES OF SHAREHOLDERS

     4.1. REPRESENTATIONS AND WARRANTIES OF SHAREHOLDERS

     Each of SEM, SVIC and Lineo hereby represents and warrants as follows:

     (a) It is a legal entity duly organized and validly existing and in good
standing under the laws of the jurisdiction of its organization, as set forth
with respect to such party in the

<PAGE>
SHAREHOLDERS AGREEMENT                                                   PAGE 13

opening paragraphs of this Agreement. It has all necessary power and authority
to own all of its properties and assets and to carry on its businesses as now
conducted.

     (b) The execution, delivery and performance of this Agreement by it do not
and will not violate any provisions of any contract, court order, arbitration,
award, law or regulation, to which it is subject.

     (c) All corporate and governmental authorizations, approvals and consents
necessary for the execution, delivery and performance by it of this Agreement
have been given or made, except for the following:

     (d) This Agreement has been duly executed and delivered by it and
constitutes the valid and legally binding agreement of such Shareholder,
enforceable against it in accordance with its terms.

     4.2. REPRESENTATIONS AND WARRANTIES OF SAMSUNG

     Each of SEM and SVIC hereby represents and warrants that no approvals,
consents or authorizations from, or registration or filing with, notice to, or
license, permit or certification from, any governmental authorities of or within
Korea are required in connection with the entering into and performance of this
Agreement and the License Agreement by the Shareholders or the Company, or are
advisable in order to obtain tax benefits for the Company or the Shareholders,
except for the approvals that are routinely granted by the Korean governmental
authorities including the approvals provided in Section 6.4.

     4.3. REPRESENTATIONS AND WARRANTIES OF LINEO

     Lineo hereby represents and warrants that no approvals, consents or
authorizations from, or registration or filing with, notice to, or license,
permit or certification from, any governmental authorities of or within the
United States are required in connection with the entering into and performance
of this Agreement and the License Agreement by the Shareholders or the Company,
except for licenses with respect to the export of certain technology under the
License Agreement from the Bureau of Export Administration of the Department of
Commerce all of which have been obtained by Lineo.

     ARTICLE 5. BUSINESS PLAN AND CAPITAL CONTRIBUTIONS

     5.1. BUSINESS PLAN

     (a) Lineo and Samsung have jointly prepared and agreed upon a preliminary
business plan setting forth the agreed purposes of the Company, a preliminary
revenue plan and other related matters. Within 60 days after the formation of
the Company, the Company shall produce a business plan covering the current
fiscal year (the "INITIAL BUSINESS PLAN"), including a budget for such period
(with detailed revenue and expense plan and employee growth targets), projected
sources and uses of cash for such period (including the nature, amount and
timing of any capital contributions or financing required for such period), and
a strategic analysis of the Company

<PAGE>
SHAREHOLDERS AGREEMENT                                                   PAGE 14

Business. Lineo and Samsung shall cooperate as appropriate with each other and
with the Company in conducting the Company Business in accordance with the
Initial Business Plan during such period, as modified from time to time by the
agreement of the Shareholders.

     (b) Each of Lineo and Samsung shall cooperate diligently and in good faith
with the Company in the preparation of a business plan covering each fiscal year
of the Company commencing with the Commercial Operations Commencement Date (each
such business plan is called an "ANNUAL BUSINESS PLAN" and each of the Initial
Business Plan and any Annual Business Plan is referred to as a "BUSINESS PLAN").
Each Business Plan shall include a budget for the period covered thereby, the
projected sources and uses of cash for such period (including the nature, amount
and timing of any capital contributions or financing required for such period),
a strategic analysis of the Company Business and such other matters as the
Shareholders or the Board of Directors shall specify. If the Board of Directors
unanimously approves any Business Plan, then the Company shall endeavor to
conduct the Company Business in accordance therewith for the period covered
thereby.

     5.2. NO FURTHER CAPITAL CONTRIBUTIONS

     No Shareholder shall have any obligation to provide additional capital
contributions or other financial accommodations to the Company. The parties
intend that the Company be self-funding after the initial capital contributions
hereunder.

     5.3. DIVIDEND POLICY

     The Shareholders agree that prior to the IPO of Shares of the Company, the
Company shall not declare any dividends without the consent of all Shareholders,
and shall retain all profits for use in expansion and development of the Company
until the profitibility and the expansion of the Company is assured by the
parties and after that time, the Company may declare and pay dividends;
provided, however, that if such IPO has not occurred by the fifth anniversary of
the date of this Agreement, the Company shall declare dividends to the maximum
extent permitted by law (after statutory reserves) unless the parties to this
Agreement otherwise agree.

               ARTICLE 6. OTHER AGREEMENTS OF THE COMPANY AND THE
                                  SHAREHOLDERS

     6.1. ACCESSION OF THE COMPANY

     The Shareholders shall cause the Company to execute and become a party to
this Agreement.

     6.2. AGREEMENTS OF THE COMPANY

     The Company agrees as follows:

     (a) It will not register any transfer of Shares owned by any Shareholder
without requiring reasonably satisfactory proof of the compliance of such
transfer with the terms and

<PAGE>
SHAREHOLDERS AGREEMENT                                                   PAGE 15

restrictions in this Agreement, and any such evidence shall be reasonably
satisfactory to all of the Shareholders.

     (b) It will keep on file at its registered office a copy of this Agreement
which will be made available to any Shareholder for inspection upon request.

     (c) It will not issue any Shares in bearer form.

     (d) The fiscal year shall end on December 31 of each year, and its
financial accounts shall be kept in accordance with generally accepted
accounting principles as in effect from time to time in Korea, and will be
audited annually.

     (e) The Company shall use its best efforts to sell the products of Lineo in
preference to those of competitors of Lineo in all cases in which Lineo products
are available.

     6.3. MANAGEMENT REPORTS; ACCESS AND INFORMATION

     (a) Not less frequently than once each fiscal quarter of the Company,
senior management of the Company shall present to the Shareholders regular
reports on the management and results of the Company Business, including any
design, installation or construction of the network, and any marketing, sales
and financial results.

     (b) Subject to Section 2.8, the Shareholders shall cause the Company and
any Subsidiary:

       (i)    to take all necessary action to allow each Shareholder the right
              to reasonable access during normal business hours to the senior
              management, properties, books and records of the Company and any
              Subsidiary for purposes of enabling such Shareholder to prepare
              its tax returns or financial information or for any other
              legitimate purpose;

       (ii)   to prepare and deliver to any Shareholder such financial or other
              information concerning the business of the Company and any
              Subsidiary as such Shareholder may reasonably request; and

       (iii)  to furnish as promptly as practicable to any Shareholder, upon
              request, such information and assistance as is reasonably
              necessary for the preparation or filing of such Shareholder's tax
              returns, the making of any election related to taxes, the
              preparation for any audit by any tax authority, and the
              prosecution or defense of any claim, suit or proceeding relating
              to any tax return.

     6.4. GOVERNMENTAL APPROVALS

     As soon as possible, but no later than 45 days following the execution and
delivery of this Agreement, Samsung and Lineo shall submit to the appropriate
Governmental Authorities a request for approval of the transactions contemplated
by this Agreement. Samsung shall work diligently and shall use all commercially
reasonable efforts to procure such approval as soon as

<PAGE>
SHAREHOLDERS AGREEMENT                                                   PAGE 16

possible following such submission, and Lineo shall provide such cooperation as
may be necessary.

     6.5. NEW SHAREHOLDERS

     Within six months after the Effective Date, Samsung and Lineo agree to use
reasonable efforts (i) to identify a strategic investor for the purchase of
Shares in an amount up to 90,000 Shares, on terms and conditions acceptable to
Samsung and Lineo, and (ii) to issue up to 90,000 Shares to employees of the
Company and others approved by Samsung and Lineo in the form of options or sale
of shares on terms approved by Samsung and Lineo. Such strategic Investor and
any employees or others obtaining Shares shall agree, as a condition thereof, to
be bound by the provisions of Section 2.4 (election of nominees of Samsung and
Lineo to the Board of Directors), Section 2.6 (confidentiality), Article 3
(restrictions on transfer), Section 6.4 (non-competition), Article 8 (dispute
resolution) and Article 9 (miscellaneous), in an agreement acceptable to Samsung
and Lineo.

     6.6. IPO

     The parties agree to cooperate with a view to effecting the IPO of the
Company's shares at such time as valuation, timing and structure of such IPO
will tend to maximize returns to the Shareholders. It is understood and agreed
that it may be necessary or advisable to modify certain provisions of this
Agreement upon or prior to such IPO, including provisions relating to the
appointment of directors, in order to comply with applicable regulations or to
meet market conditions. The parties agree to discuss such matters in good faith
at such time.

     6.7. *

                               ARTICLE 7. DEADLOCK

     7.1 DEADLOCK DECLARATION

     If the necessary super-majority under Section 2.4(k) has not been obtained
with respect to any matter set forth in such Section 2.4(k) for more than 60
days from the date of the second notice of a Board meeting at which such matter
was raised, either of the Shareholders may refer such matter (a "DEADLOCK") for
negotiation under this Article by notice to the other Shareholder (a "DEADLOCK
REFERENCE"). Upon receiving the Deadlock Reference, the Shareholders shall
negotiate in good faith in an effort to resolve the Deadlock within 45 days
after receipt of such Deadlock Reference, including meetings at the senior level
of management (executive vice

*MATERIAL HAS BEEN OMITTED PURSUANT TO A REQUEST FOR CONFIDENTIAL TREATMENT,
AND SUCH MATERIAL HAS BEEN FILED SEPARATELY WITH THE SEC.

<PAGE>
SHAREHOLDERS AGREEMENT                                                   PAGE 17

president level or equivalent) to negotiate with respect to the matter. If after
such 45 day period the Shareholders have not resolved the Deadlock, either
Shareholder (the "SERVING PARTY") shall have the right to give a notice (the
"FINAL DECLARATION OF DEADLOCK") to the other (the "RECEIVING PARTY") specifying
its final terms regarding the pending matter. Such Final Declaration of Deadlock
may be given by a Shareholder only if such Shareholder reasonably concludes, and
sets forth in the Final Declaration of Deadlock the reason for such conclusion,
that the continued ordinary operations and viability of the Company are likely
to be materially adversely affected by virtue of the inability of the
Shareholders to agree on the issues as to which the Deadlock has arisen.

     7.2 REVIEW PERIOD

     (a) Upon receiving the Final Declaration of Deadlock, the parties shall
negotiate for a thirty (30) day period in an attempt to resolve the Deadlock by
buying all of the shares of the other party. In the event that negotiation
fails, the Receiving Party shall have a review period of thirty (30) days (the
"Review Period"), during which the Receiving Party shall have options to provide
the Serving Party with a notice of the Receiving Party's agreement to all (but
not less than all) the terms of the Serving Party regarding the pending matter
described in the Final Declaration of Deadlock whereby the Deadlock shall be
deemed to be resolved on those terms.

     (b) If the Receiving Party does not provide the Serving Party with a notice
as described in Section 7.2(a) whereupon the Representative Director appointed
by the Serving Party shall take all steps required in order to liquidate the
Company in an orderly fashion, and the Receiving Party shall cause the
Representative Director and other directors appointed by it to cooperate in such
liquidation. The Serving Party shall provide full information with respect to
the steps taken for such liquidation. Upon the liquidation of the Company, this
Agreement shall terminate as provided in Section 8.2(ii).

          ARTICLE 8. TERM, EXPIRATION AND TERMINATION OF THE AGREEMENT

     8.1. TERM; EXPIRATION

     This Agreement shall become effective automatically upon the Effective
Date, and shall expire on the latest date permitted by applicable law.

     8.2. TERMINATION OF THE AGREEMENT

     (a) This Agreement shall terminate and be of no further force and effect
upon the occurrence of any of the following events:

       (i)    upon the mutual agreement of the Shareholders;

       (ii)   upon the dissolution, liquidation, or winding up of the Company;

       (iii)  at such time as either Lineo, on the one hand, or Samsung, on the
              other, owns less than 10% of the Shares;

<PAGE>
SHAREHOLDERS AGREEMENT                                                   PAGE 18

       (iv)   by either Shareholder if all approvals of Korean Governmental
              Authorities required for this Agreement shall not have been
              obtained within 90 days after the Effective Date; or

       (v)    a material breach of obligations under this Agreement by any
              party, including without limitation Lineo's obligations under
              Section 6.7.

     (b) Termination under this Article shall not relieve any Shareholder of any
obligation or liability accrued hereunder prior to such termination or which
arises by reason of such termination.

     (c) The obligations of the Shareholders in Section 2.6 (confidentiality)
and in Articles 9 and 10 shall survive the expiration or any termination of this
Agreement.

                             ARTICLE 9. ARBITRATION

     9.1. DISPUTE RESOLUTION

     (a) Any claim, dispute, difference or controversy arising under or with
respect to this Agreement, other than a claim for specific enforcement or other
injunctive relief, shall be resolved by arbitration before a panel of three
arbitrators under the Rules of Conciliation and Arbitration of the International
Chamber of Commerce. All arbitration proceedings shall be conducted in the
English language and shall take place in Singapore. The determination of the
arbitrators shall be final and may be enforced in any court of competent
jurisdiction. The arbitrators shall be empowered to issue a decree of specific
performance pursuant to Section 9.2.

     (b) All costs and expenses (including reasonable attorneys' fees and
expenses) incurred by the prevailing party in connection with any claim asserted
in any arbitration proceeding commenced pursuant to this Section shall be borne
by the party against whom the award is made.

     9.2. SPECIFIC PERFORMANCE

     The parties hereby acknowledge that it is impossible to measure in money
the damages which will accrue to any party hereto by reason of a failure of any
other party hereto to perform any of its obligations provided for in this
Agreement. The parties hereto will be irreparably damaged in the event that this
Agreement is not specifically enforced, and in any suit, action or proceeding
commenced pursuant to this Agreement an aggrieved party shall be entitled to a
decree of specific performance to enforce the terms hereof. Such remedy,
however, shall be cumulative and not exclusive and shall be in addition to any
other remedy which any party shall have hereunder.

                           ARTICLE 10. MISCELLANEOUS

     10.1. ASSIGNMENT, ETC.

<PAGE>
SHAREHOLDERS AGREEMENT                                                   PAGE 19

     This Agreement (a) may not be assigned by any of the parties (other than an
assignment by a Shareholder to an Affiliate of such Shareholder in connection
with a transfer of Shares to such Affiliate under Section 3.1(b)) without the
prior written consent of all other parties hereto, (b) shall be binding upon and
shall inure to the benefit of the successors and permitted assigns of each of
the parties, and (c) shall be binding upon any transferee who has received any
Shares in accordance with the provisions of this Agreement. Any purported
assignment of this Agreement or transfer or purported transfer of Shares owned
by the Shareholders in violation of the provisions of this Agreement shall be
null and void and of no force or effect.

     10.2. NOTICES

     All notices, consents, requests and other communications provided for in,
or effected under, this Agreement shall be in writing and shall be delivered as
follows: (i) delivered by hand; (ii) mailed, first class postage prepaid, return
receipt requested; (iii) sent by overnight courier; or (iv) sent by facsimile
transmission (with confirmation of transmission), addressed as follows:

     (a) if to Lineo:

         390 South 400 West
         Lindon, UT 84042
         Tel: 801-426-5001
         Fax: 801-426-6166
         Attention: President and CEO

     (b) if to Samsung:

         Samsung Electro-Mechanics Co., Ltd.

         314, Maitan-3Dong, Paldal-Gu, Suwon
         Kyunggi-Do, Korea, 442-743
         Tel: 82-31-210-5215
         Fax: 82-31-210-6363
         Attention: Legal Affairs

         Samsung Venture Investment Company

         15th Floor, Samsung Main Bldg.
         250, 2-Ka, Taepyung-Ro, Chung-Ku,
         Seoul, Korea  100-742
         Tel: 82-2-728-4892
         Fax: 82-2-728-4898
         Attention: Legal Affairs

     (c) if to the Company:

     Notice shall be provided to all parties until the Company provides written
notice to all parties of the proper notice address and phone numbers;

<PAGE>
SHAREHOLDERS AGREEMENT                                                   PAGE 20

or, in either case or in the case of any other Shareholder, at such other
address as the Shareholder to receive such communication may hereafter designate
by notice given as provided herein to the other Shareholders. All notices shall
be deemed effective upon receipt.

     10.3. COSTS AND EXPENSES

     Each Shareholder shall bear its own costs and expenses in connection with
the preparation, negotiation, execution and performance of this Agreement. The
actual out-of-pocket cost to form Company shall be reimbursed by Company to
Shareholders promptly after the formation and expenses incurred by Company after
formation shall be paid by Company.

     10.4. NO WAIVER

     The failure of any of the parties hereto to insist upon strict adherence to
any provision of this Agreement on any occasion shall not be considered a waiver
of any right, nor shall it deprive that party of the right thereafter to insist
upon strict adherence to that provision or any other provisions of this
Agreement.

     10.5. AMENDMENT

     Any waiver, alteration, or modification of any of the provisions of this
Agreement shall not be binding unless in writing and signed by a duly authorized
officer of the Company and a duly authorized representative of each of the other
parties hereto.

     10.6. THIRD PARTIES

     Nothing contained in this Agreement, either expressed or implied, is
intended to confer any rights or remedies upon any person or entity other than
the parties hereto, and their respective successors and permitted transferees
and assigns.

     10.7. HEADINGS

     The headings in this Agreement are inserted for convenience only and shall
not affect the interpretation hereof.

     10.8. GOVERNING LAW

     This Agreement shall be governed by, and construed in accordance with, the
laws of the Republic of Korea, without regard to principles of conflicts of law
thereunder.

     10.9. ENTIRE AGREEMENT

     This Agreement constitutes the full and complete understanding among the
parties with respect to the subject matter of this Agreement, and neither the
correspondence, or any letter of intent or other documents exchanged prior to or
in connection with the signing of this Agreement with respect to the subject
matter of this Agreement, nor any statements, warranties, representations or
agreements, whether oral or written, made with respect to the subject matter of

<PAGE>
SHAREHOLDERS AGREEMENT                                                   PAGE 21

this Agreement, during negotiations or otherwise, shall be binding on any party,
unless expressly incorporated in this Agreement.

     10.10. INVALIDITY

     If any one or more of the provisions, or portions of any provision, of this
Agreement shall be held to be invalid, illegal or unenforceable, then the
validity, legality or enforceability of the remaining provisions or parts
thereof shall not in any way be affected or impaired thereby.

     10.11. COUNTERPARTS

     This Agreement may be executed in any number of counterparts, each of which
shall be deemed an original and all of which together shall constitute one and
the same instrument.

     10.12. LANGUAGE

     (a) This Agreement is being executed and delivered in English, and, in
the case of any inconsistency between the terms of the English language
version of this Agreement and any translation hereof, the English language
version hereof shall govern and control.

     (b) All meetings of the Shareholders or of the Board of Directors shall be
conducted in English or, if conducted in Korean, shall be simultaneously
translated into English. All materials provided to Shareholders and directors
shall be in the English language or in the Korean language accompanied by an
English translation.

     10.13. FURTHER ASSURANCES

     The parties hereto shall do and execute, or cause to be done and executed,
all such further acts, deeds, documents and things as may be necessary to give
full effect to the terms of this Agreement, including without limitation voting
or refraining from voting any shares held by them or under their direct or
indirect control, and use reasonable efforts to procure that any director or
directors appointed by them or any party under their direct or indirect control
votes or refrains from voting so as to give full effect to this Agreement and
its Annexes.

     10.14. CONFLICTS

     In the event of any conflict or inconsistency between the terms of this
Agreement and the terms of the AOI of the Company or any Subsidiary, the terms
of this Agreement shall prevail.

<PAGE>
SHAREHOLDERS AGREEMENT                                                   PAGE 22

IN WITNESS WHEREOF, the parties have duly executed this Agreement as of the day
and year first above written.

                                   LINEO, INC.

                                   By  /s/ Bryan Sparks
                                   Name    Bryan Sparks
                                   Title   President & CEO

                                   SAMSUNG ELECTRO-MECHANICS CO., LTD.

                                   By  /s/ Park Young Won
                                   Name    Park Young Won
                                   Title   Executive Director

                                   SAMSUNG VENTURE INVESTMENT CORPORATION

                                   By  /s/ Jae Ham Lee
                                   Name    Lee, Jae Ham
                                   Title   CEO

In consideration of the representations, warranties, covenants and others terms
contained in this Agreement, Listech Limited hereby agrees to become a party to
this Agreement, and shall be bound by and otherwise subject to this Agreement to
the same extent as if originally a party hereto.

                                   LISTECH LIMITED

                                   By
                                   Name
                                   Title
                                   Date     ___________________, 2000

<PAGE>
SHAREHOLDERS AGREEMENT                                                   PAGE 23

                                    EXHIBIT 1
                      LICENSE AGREEMENT WITH LISTECH LTD.
<PAGE>

                                   LINEO, INC.
                       LICENSE AGREEMENT WITH LISTECH LTD.
                              NO.__________________

This License Agreement (this "Agreement") between Lineo, Inc. ("Lineo") and the
Licensee identified below ("Licensee"), entered as of the Effective Date
identified in Schedule A, governs Licensee's licensed rights to use, reproduce,
market, distribute, and sell software and related products and documentation
proprietary to Lineo, and consists of the following:

                THIS SIGNATURE PAGE

                SCHEDULE A - SCOPE, GENERAL TERMS AND LICENSE FEES
                     EXHIBIT 1 - LIST OF LICENSED PRODUCTS, PRICES
                     EXHIBIT 2 - INITIAL LICENSE PURCHASE ORDER
                     EXHIBIT 3 - STANDARD LICENSE PURCHASE ORDER

                SCHEDULE B - STANDARD TERMS AND CONDITIONS
                     EXHIBIT 1 - TRADEMARK USAGE POLICY
                     EXHIBIT 2 - END USER LICENSE

                SCHEDULE C - LICENSED MARKS

    1.  LINEO ADDRESS AND CONTACT:      Lineo, Inc.
                                        Attention: Legal
                                        390 South 400 West
                                        Lindon, UT 84042, U.S.A.
                                        Voice: 1-801-426-5001
                                        Fax:   1-801-426-6166

    2.  LICENSEE ADDRESS AND CONTACT:   Listech Ltd.
                                        c/o Samsung Electro-Mechanics Co., Ltd.
                                        Attention: Planning Department
                                        314, Maetan-3 Dong, Paldal-Gu, Suwon
                                        Kyunggi-Do, Korea, 442-743
                                        Voice: 82-331-210-6639
                                        Fax:   82-331-210-5965

By signing below, the parties acknowledge their agreement with the terms and
conditions of this Agreement, and each signatory represents and certifies that
he or she is authorized to sign on behalf of his or her respective party and
bind it to all of the terms and conditions of this Agreement:

LINEO, INC.                             LISTECH LTD.

By:  ______________________________     By:  __________________________________

Printed Name: _____________________     Printed Name: _________________________

Title: ____________________________     Title: ________________________________

Date: September 22, 2000                Date: September 22, 2000

<PAGE>

                                   LINEO, INC.
                                LICENSE AGREEMENT

                                   SCHEDULE A
                      SCOPE, GENERAL TERMS AND LICENSE FEES

1.   EFFECTIVE DATE: September 22, 2000

2.   LICENSED PRODUCTS

     The Licensed Products are each of the products identified in Exhibit 1 to
this Schedule A.

3.   TERRITORY

     Territory is worldwide.

4.   LICENSE TERM

     The initial term of this Agreement shall expire 12 months from the
     effective date. The Agreement will be renewable on 30 days notice and the
     mutual consent of Licensee and Lineo for successive 12-month terms.

5.   FEES AND PAYMENT; PURCHASE ORDERS

     The current fees and payment terms are as set forth in Exhibit 2 (Initial
     License Purchase Order) and Exhibit 3 (Standard License Purchase Order) to
     this Schedule A. The fees for the Licensed Products are subject to change
     without notice, subject to the most favored licensee provisions below.

6.   MOST FAVORED LICENSEE

     If Lineo hereafter grants a subsequent license to the Licensed Products to
     any Korean company, Lineo shall if requested by Licensee modify this
     Agreement to the extent necessary in order to provide to Licensee the same
     terms including, without limitation, fees and payment terms, scope of
     transferred rights, cross licenses, duration of the agreement, and other
     licensor or licensee obligations, as those granted to such subsequent
     Korean licensees.

7.   INITIAL LICENSE PURCHASE ORDER

     Licensee has agreed to purchase $1,080,000.00 in Licensed Products upon
     funding by Lineo and Samsung of their initial capital contributions to
     Licensee under the Shareholders Agreement dated September 22, 2000. This
     initial order to Lineo, which shall be governed by different payment terms
     from those that govern standard purchase orders from Licensee to Lineo, is
     set forth as Exhibit 3 to this Schedule A, and shall become binding on
     Licensee simultaneously with the funding by Lineo of its capital
     contributions.

8.   MODIFICATION OF FEES AND PAYMENT TERMS; ASSIGNMENT OF SALES ADVISOR

     On a case-by-case basis, at the request of Licensee, Lineo may consider
     modification of the fees and payment terms applicable to Licensed Products,
     including volume and other discounts, when deemed appropriate to secure
     substantial business. To facilitate such procedures, Lineo may assign a
     sales advisor (the "ADVISOR") to assist and advise Licensee, with the
     corporate authority to make modifications to fees and payment terms
     applicable to Licensed Products. The Advisor will be

License Agreement    Page 2 of 20  Lineo, Inc., 390 South 400 West, Lindon, Utah
<PAGE>

     based in the United States but will be expected to travel to Korea as
     appropriate, and Licensee agrees to use reasonable efforts to utilize his
     or her expertise by bringing him or her to meetings with customers and
     involving him or her to the maximum extent in Licensee's sales activities
     while in Korea, subject to any other commitments he or she may have. Lineo
     will absorb all travel and other costs of the Advisor unless otherwise
     agreed.

License Agreement    Page 3 of 20  Lineo, Inc., 390 South 400 West, Lindon, Utah
<PAGE>

                             EXHIBIT 1 TO SCHEDULE A
                            LIST OF LICENSED PRODUCTS

EMBEDIX SDK
EMBEDIX LINUX*
EMBEDIX BROWSER*
EMBEDIX HIGH AVAILABILITY

*    DENOTES SPECIFIED LICENSED PRODUCT AS TO WHICH THE CREATION OF DERIVATIVE
     WORKS IS AUTHORIZED.

                             EXHIBIT 2 TO SCHEDULE A
                         INITIAL LICENSE PURCHASE ORDER

            [ATTACHED TO SHAREHOLDER AGREEMENT OF SEPTEMBER 22, 2000]

                             EXHIBIT 3 TO SCHEDULE A
                     FORM OF STANDARD LICENSE PURCHASE ORDER

                                    [TO COME]

License Agreement    Page 4 of 20  Lineo, Inc., 390 South 400 West, Lindon, Utah
<PAGE>

                                   LINEO, INC.
                                LICENSE AGREEMENT

                                   SCHEDULE B
                          STANDARD TERMS AND CONDITIONS

The following standard terms and conditions apply:

1.   DEFINITIONS. For purposes of this Agreement, the following definitions
     apply to the respective terms:

     a.   AGREEMENT means this Agreement, consisting of the Signature Page,
          Schedules A through C, Exhibits 1, 2 and 3 to Schedule A, Exhibits 1
          and 2 to this Schedule B, and any additional documents attached and
          initialed by the parties.

     b.   The terms BUY, PURCHASE, SALE, SELL and other similar terms, when used
          in connection with the distribution of the Licensed Products, shall
          mean the granting of a license or sublicense and shall not be deemed
          for any purpose to mean a transfer of title or other rights of
          ownership in the Licensed Products, other than the rights specifically
          set out in this Agreement or in applicable End User License
          Agreements.

     c.   CONFIDENTIAL INFORMATION means all business, marketing and technical
          information of each party considered by each to be trade secrets or
          otherwise valuable proprietary information, designated or marked as
          such by either. Confidential Information shall not include information
          that (i) is now or later becomes generally known to the computer
          industry (other than as a result of a breach of this Agreement); (ii)
          is independently developed by the receiving party; or (iii) the
          receiving party lawfully obtains from any third party without
          restrictions on use or disclosure.

     d.   DERIVATIVE WORKS means a revision, modification, translation,
          reproduction in other form or medium, abridgment, condensation or
          expansion of a Licensed Product or Documentation or any other form in
          which a Licensed Product or Documentation may be recast, transferred,
          or adapted and which, if prepared without the consent of Lineo, would
          be an infringement of Lineo's copyright.

     e.   DOCUMENTATION means those software user manuals, reference manuals and
          installation guides, or portions thereof (if any), which are
          distributed in conjunction with the Licensed Products identified in
          Exhibit 1 to Schedule A.

     f.   END USER means an entity that acquires the Licensed Product for
          Internal Use.

     g.   INTERNAL USE means use for purposes that do not directly produce
          revenue for the user.

     h.   LICENSED PRODUCTS means the Licensed Products identified in Exhibit 1
          to Schedule A, including updates thereof (if any). Lineo reserves the
          right at any time to make changes to any Licensed Product, including
          without limitation changes required (i) for security or (ii) to
          facilitate performance in accordance with specifications.

     i.   LINEO MARKS means Lineo's trademarks, trade names, service marks,
          logos, designations and insignias, as well as any third-party marks
          licensed to Lineo with rights of sublicense, including without
          limitation there set out in Schedule C.

     j.   OEM means an original equipment manufacturer of an OEM Product.

License Agreement    Page 5 of 20  Lineo, Inc., 390 South 400 West, Lindon, Utah
<PAGE>

     k.   OEM PRODUCT refers to the specific hardware and software manufactured
          or produced by an OEM with which any Licensed Product is to be bundled
          or integrated to create a single product offering, and which is then
          sold to a third party without a separate charge or license for such
          Licensed Products.

     l.   SPECIFIED LICENSED PRODUCT means a Licensed Product identified on
          Exhibit 1 to Schedule A as authorized for modification and the
          creation of Derivative Works therefrom.

2.   CONTRACT RESPONSIBILITIES: Subject to the terms and conditions of this
     Agreement, the parties have the following respective contractual
     responsibilities:

     a.   LINEO'S RESPONSIBILITIES: Lineo shall:

          1)   Grant Licensee the rights and licenses to the Licensed Products
               as set forth in Section 3 hereof;

          2)   Warrant the Licensed Products as set forth in Section 7 hereof;
               and

          3)   Indemnify Licensee as set forth in Section 8(a) hereof.

     b.   LICENSEE'S RESPONSIBILITIES: Licensee shall:

          1)   Market, sell and distribute units of the Licensed Products within
               the Territory identified in Schedule A;

          2)   Provide services to customers, including providing engineering
               services to ensure that the Licensed Products are compatible with
               customers' devices;

          3)   Make all payments to Lineo as set forth in Schedule A and Section
               4 hereof;

          4)   Protect Lineo's proprietary rights in the Licensed Products as
               set forth in Section 5 hereof;

          5)   Provide, or cause to be provided by its OEM sublicensees, an
               appropriate End User License Agreement to End Users, as set forth
               in Sections 5(b) and 7(b) hereof;

          6)   Indemnify Lineo as set forth in Section 8(b) hereof; and

          7)   Perform all other obligations required of Licensee under this
               Agreement.

3.   GRANT OF LICENSES. Subject to the terms and conditions of this Agreement
     and for the term hereof, Lineo hereby grants to Licensee the following
     rights and licenses:

     a.   LICENSED PRODUCTS AND DOCUMENTATION. Lineo hereby grants to Licensee
          and its wholly-owned subsidiaries a nonexclusive and nontransferable
          right and license to (i) use the Licensed Products for Internal Use
          only, (ii) market, sell and distribute copies of the Licensed
          Products, with copies of the Documentation, to OEMs and (iii) to
          modify the Specified Licensed Products and to create Derivative Works
          solely of the Specified Licensed Products for the purposed of
          developing, enhancing and supporting such Specified Licensed Products
          for embedding in products of OEMs.

     b.   TRADEMARKS. Lineo hereby grants to Licensee the nonexclusive,
          nontransferable right and license to use and display Lineo Marks
          identified in Schedule E, solely in connection with and only to the
          extent reasonably necessary for the marketing, distribution and

License Agreement    Page 6 of 20  Lineo, Inc., 390 South 400 West, Lindon, Utah
<PAGE>

          support of the Licensed Products during the term of this Agreement,
          provided that any such use and display shall comply with Lineo's then
          current trademark usage policies. A copy of Lineo's current trademark
          policy is attached as Exhibit 1 to this Schedule B. Upon expiration or
          termination of this Agreement, Licensee agrees to cease all display,
          advertising and use of any and all Lineo Marks. In the case of bundled
          products, Licensee agrees not to alter, erase or overprint any notice
          provided by Lineo and not to attach any additional trademarks without
          the prior written consent of Lineo (not to be unreasonably withheld as
          respects bundled products) or affix any Lineo Marks to any
          non-Licensed Products. Licensee recognizes Lineo's rights to Lineo
          Marks and the goodwill attaching to Lineo Marks. Licensee agrees not
          to use, employ or attempt to register any trademarks or trade names
          that are confusingly similar to Lineo Marks.

     c.   THIRD PARTY LICENSE. If all or any part of the Licensed Products
          delivered to Licensee has been licensed to Lineo by a third party
          software supplier then, notwithstanding anything to the contrary
          contained in this Agreement, Licensee is granted a sublicense to the
          third party software subject to the same terms and conditions as those
          contained in the agreement between Lineo and such third party software
          supplier. Lineo reserves the right to substitute any third party
          software in the Licensed Products.

     d.   GENERAL PUBLIC LICENSE. Certain components of certain Licensed
          Products are components licensed under the GNU General Public License
          (version 2), which Lineo supports. Licensee may obtain a copy of the
          GNU General Public License at www.gnudocs.com/GNU/COPYING. Lineo will
          provide source code for any of the components of those Licensed
          Products licensed under the GNU General Public License. To obtain such
          source code, send email to embedix-support@lineo.com.

     e.   SUBLICENSE AGREEMENTS. Licensee may grant OEMs within the Territory
          identified in Schedule A the sublicensed rights to (i) use Licensed
          Products for Internal Use only, and (ii) market, sell and distribute
          copies of the Licensed Products bundled with or integrated in OEM
          Products to End Users, provided that such activities are governed by
          written sublicenses consistent with the terms of this Agreement, and
          no less restrictive than the licenses granted herein, in a form to be
          approved by Lineo. Licensee assumes responsibility for the actions of,
          and its agreements with, its OEM sublicensees and for the compliance
          of such OEMs with the terms and restrictions of this Agreement
          relating to the Licensed Products, including, but not limited to,
          those terms and restrictions set forth in Sections 3, 5, 6 and 7
          hereof, and the provision of applicable End User License Agreements to
          End Users set forth in Sections 5(b) and 7(b) hereof. To that end,
          Licensee shall take prompt and commercially reasonable action at its
          expense to remedy any breach by its OEM sublicensees of duties imposed
          by this Agreement and to obtain all other appropriate relief and
          shall, in addition, immediately notify Lineo in writing of the breach
          and corrective action taken. The execution of these duties by Licensee
          shall not preclude Lineo from also taking corrective action, for which
          purposes it will be deemed to be an intended third-party beneficiary
          of all of Licensee's agreements with OEMs dealing with Licensed
          Products. Licensee's obligations to enforce any relevant sublicense
          and to protect the interest of Lineo shall survive expiration or
          termination of this Agreement.

     f.   DERIVATIVE WORKS.

          1)   Licensee hereby irrevocably assigns to Lineo all right, title,
               and interest in and to all Derivative Works created by it,
               whether or not authorized by Lineo, and agrees to provide such
               documents and other assistance as Lineo may request in order to
               perfect its rights in such Derivative Works, and to provide Lineo
               on request with source codes and all other information with
               respect to such Derivative Works.

License Agreement    Page 7 of 20  Lineo, Inc., 390 South 400 West, Lindon, Utah
<PAGE>

          2)   With respect to Derivative Works created by Licensee from
               Specified Licensed Products, Lineo agrees that it will not during
               the term of this Agreement market, sell or distribute such
               Derivative Works, or grant a license to any third party to
               market, sell or distribute such Derivative Works, without paying
               compensation to Licensee on terms to be agreed hereafter from
               time to time.

          3)   Notwithstanding that the Licensed Products may embody Derivative
               Works created by Licensee, Licensee shall continue to be liable
               to pay Lineo the prices and fees for the Licensed Products set
               forth in Exhibit 1 to Schedule A without any modification or
               setoff.

          4)   If Licensor wishes to create Derivative Works for purposes of
               developing a new product not constituting a Licensed Product,
               then prior to beginning such development it shall consult with
               Lineo as to the terms and conditions, including fees, on which
               such new product may be developed, used, marketed, sold or
               distributed by either party during the term of this Agreement. If
               the parties are unable to agree on such terms and conditions,
               Licensee shall not create such Derivative Works.

     g.   PRODUCT TAMPERING.

          1)   Except for Specified Licensed Products and related Documentation,
               Licensee shall have no rights directly or indirectly to modify
               Licensed Products or the Documentation, or any portion thereof,
               or to prepare any other form of Derivative Works for such
               Licensed Products.

          2)   Licensee shall have no rights directly or indirectly to
               de-compile, reverse engineer, reverse compile or perform any
               similar type of operation on the Licensed Products (including
               Specified Licensed Products) or the Documentation, or any portion
               thereof.

     g.   LIMITATIONS. Notwithstanding any of the foregoing, distribution of the
          Licensed Products in any country where the proprietary rights of Lineo
          and its third-party licensors in the Licensed Products would not be
          recognized or would not be protected under the laws of such country is
          prohibited.

     h.   RESERVATION OF RIGHTS. Lineo reserves all rights not expressly granted
          under this Agreement, including, but not limited to, the rights to
          market, sell and distribute the Licensed Products to OEMs and End
          Users directly or indirectly through its distribution channels.

4.   PRICING AND PAYMENT

     a.   PRICING AND LICENSE FEES. Licensee shall pay to Lineo the License Fees
          set out in Schedule A as required therein. Prices are exclusive of all
          applicable taxes. Licensee agrees to pay all taxes associated with the
          marketing, sublicensing, distribution and transfer of all Licensed
          Products, including but not limited to sales, use, excise, added value
          and similar taxes and all customs, duties or governmental impositions,
          but excluding (i) taxes on Lineo's net income and (ii) the withholding
          tax, if any, imposed upon such payments (as royalties) by the Republic
          of Korea (or other jurisdiction, if any). Licensee shall pay to the
          relevant tax authorities, and deduct from the payments due to Lineo
          hereunder, such withholding tax, if any, imposed upon such payments at
          the lowest rate permitted with respect to royalties by the treaty on
          the avoidance of double-taxation between the United States of America
          and the Republic of Korea (or other jurisdiction). Licensee shall
          provide Lineo with evidence, in the form of original tax receipts
          issued by the relevant tax authorities, proving payment of such
          withholding tax, and shall deliver to

License Agreement    Page 8 of 20  Lineo, Inc., 390 South 400 West, Lindon, Utah
<PAGE>

          Lineo any certificates or other documents reasonably requested by
          Lineo to claim as a credit or a deduction against any foreign income
          or profits taxes any withholding taxes which Licensee shall have
          withheld. No taxes or other deductions (other than withholding tax on
          royalties) shall be withheld from any payment hereunder, and if any
          such withholding is required Licensee shall pay such additional amount
          as may be required so that Licensee shall receive the amount it would
          have received had no such withholding been required. Licensee shall
          use its best efforts in assisting Lineo to lawfully minimize such
          taxes (including the use of offshore sales subsidiaries for sales
          outside Korea).

     b.   PAYMENT AND REPORTING. License fees will accrue in the applicable
          corresponding quantity upon distribution by Licensee of a copy of a
          Licensed Product in any form to an OEM or End User. Licensee shall pay
          Lineo License Fees accrued during each calendar month, together with
          any other fees accruing over the same period, within 30 days following
          the date of invoice for such month. Payment shall be accompanied by a
          written report detailing the quantity, type, customer name, and
          destination of all Licensed Products shipped by Licensee in the prior
          month and showing calculation of all fees payable thereon. All
          payments shall be made in U.S. dollars (i) at Lineo's address as
          indicated in this Agreement or at such other address as Lineo may from
          time to time indicate by proper notice hereunder or (ii) by wire
          transfer to a bank and account number to be designated by Lineo.

     c.   INTEREST. Interest shall accrue on any unpaid payment or payment
          balance at an annual rate of 12% per annum, or, if lower, at the
          highest lawful rate, calculated from the date the payment is due to
          the date it is received by Lineo. Arrearage in excess of $5,000 not
          paid within 10 days of written demand following the date payment is
          due shall be grounds for Lineo's termination of this Agreement at
          Lineo's option.

     d.   REPORTING. Licensee shall, within 30 days after the end of each
          calendar quarter during the term of this Agreement, prepare a report
          summarizing the number and type Licensed Products distributed during
          such quarter. Licensee shall also maintain complete and accurate
          accounting records, in accordance with sound accounting practices, to
          support and document Licensed Products distributed in connection with
          this Agreement. Such records shall be retained for a period of at
          least 2 years after the year to which they pertain.

     e.   RECORDS EXAMINATIONS. Licensee agrees to allow Lineo to examine
          Licensee's records to test Licensee's compliance with this Agreement.
          Any examination will be conducted only by a firm of certified public
          accountants selected by Lineo, and will occur during regular business
          hours at Licensee's offices and will not interfere unreasonably with
          Licensee's business activities. Examinations will be made no more
          frequently than annually, and Lineo will give Licensee 15 business
          days or more prior written notice of the date of the examination and
          the name of Lineo's authorized representative who will be conducting
          the examination. The audit will be conducted at Lineo's expense unless
          the results of such audit establish that inaccuracies in the annual
          reports have resulted in underpayment to Lineo of more than 5% of the
          amount due in any year, in which case Licensee shall pay all amounts
          determined to be due and shall bear the expenses of the audit. All
          information obtained by the accountants conducting the audit will be
          maintained as confidential. The accountants will give Licensee and
          Lineo an examination report containing only the information necessary
          to indicate compliance or non-compliance with this Agreement.

5.   LINEO'S INTELLECTUAL PROPERTY RIGHTS

     a.   ACKNOWLEDGMENT OF LINEO'S RIGHTS. For purposes of this Agreement, and
          with the exception only of those elements (if any) of the Licensed
          Products specifically identified

License Agreement    Page 9 of 20  Lineo, Inc., 390 South 400 West, Lindon, Utah
<PAGE>

          and designated by Lineo as third-party software, Licensee acknowledges
          and confirms Lineo's exclusive worldwide rights, including copyright
          in, and the validity of the Licensed Products (including, without
          limitation, all input/output and report formats, screen displays, menu
          features and overall structure, sequence and organization) and in
          Lineo Marks. Licensee agrees not to challenge or otherwise to
          interfere with the use and ownership by Lineo of the Licensed Products
          or any of the intellectual property rights associated with the
          Licensed Products or Lineo Marks (hereinafter referred to collectively
          as "Lineo Intellectual Property"). Licensee also shall not permit any
          personnel to remove any proprietary or other legends or restrictive
          notices contained or included in any materials supplied or approved by
          Lineo, and Licensee shall not permit any personnel to copy or modify
          or reverse-engineer any materials, including the Licensed Products
          provided by Lineo, except as and to the extent specifically permitted
          under this Agreement. Title to every copy of a Licensed Product is
          vested and shall remain in Lineo, or, as applicable, in such third
          party from whom Lineo holds rights of license and distribution, and
          title does not pass with any license under this Agreement.

     b.   END USER LICENSE AGREEMENTS. Licensee agrees to exercise commercially
          reasonable efforts to ensure that each End User receiving a Licensed
          Product through Licensee's OEM sublicensees understands, and agrees to
          be bound by, an appropriate End User License Agreement that is no less
          restrictive in its application to the Licensed Product than the
          then-current form of Lineo's End User License Agreement, the most
          current version of which is attached as Exhibit 2 to this Exhibit B.

     c.   LICENSEE'S WAIVER OF RIGHTS. Licensee further acknowledges that it has
          no rights of any kind anywhere in the world in any Lineo Intellectual
          Property other than those limited rights granted by this Agreement.
          Accordingly, Licensee waives (a) all claims of any right by Licensee
          in any Lineo Intellectual Property and (b) the right, if any, to file
          or own in its own name or in that of any designee, any application for
          registration of any trademark, copyright, patent, industrial design,
          trade secret or other intellectual property which forms part of Lineo
          Intellectual Property, or to own any registration or patent resulting
          therefrom. In the event Licensee, in any jurisdiction of the world,
          files such an application or obtains such a patent or registration in
          violation of this section, such application, registration or patent
          shall be deemed held in trust by Licensee for Lineo and shall be
          assigned by Licensee to Lineo without conditions and upon demand by
          Lineo.

     d.   PRESERVATION AND SECURITY OF PROPRIETARY INFORMATION. Licensee shall
          not sell, assign, lease, license, transfer or otherwise disclose the
          Licensed Products except as expressly authorized by this Agreement.
          Licensee shall safeguard any and all copies of the Licensed Products
          against unauthorized disclosure, reproduction or tampering, and shall
          assist Lineo in the enforcement of Lineo's rights in the event of
          unauthorized disclosure by any person under Licensee's control or
          service. Licensee shall also ensure that Lineo's copyright, trademark
          and patent notices, which may from time to time be updated, are
          prominently displayed on all copies of products and documentation
          containing the Licensed Products. Licensee shall not remove or obscure
          any copyright, trademark, patent or other proprietary rights notice
          already present on any of the Licensed Products or Documentation. The
          notice of Lineo's intellectual property rights in each Licensed
          Product shall read as follows: "Licensed Software(C)Lineo,
          Inc.1999-2000, all rights reserved."

     e.   GOODWILL. To protect and preserve the reputation and goodwill of Lineo
          and of the Licensed Products, Licensee shall (1) avoid deceptive,
          misleading or unethical practices that are or might be detrimental to
          Lineo, the Licensed Products or the public, including any
          disparagement of Lineo or the Licensed Products; (2) make no false or
          misleading representations with regard to Lineo or the Licensed
          Product; (3) refrain from publishing or employing any misleading or
          deceptive advertising material reflecting upon Lineo or the Licensed
          Products; (4) refrain from making any representations, warranties or

License Agreement   Page 10 of 20  Lineo, Inc., 390 South 400 West, Lindon, Utah
<PAGE>

          guarantees with respect to the specifications, features or
          capabilities of the Licensed Program that are inconsistent with the
          Documentation and marketing literature distributed by Lineo, including
          all warranties and disclaimers contained in such literature; (5) not
          distribute for any purpose any marketing materials, packaging or other
          material bearing Lineo Marks which have not been first approved by
          Lineo; and (6) enter into agreements for marketing and distribution of
          the Licensed Products only with such OEMs who have agreed to be bound
          by the foregoing terms as part of the applicable sublicense agreement.

     f.   THIRD-PARTY REQUIREMENTS. In the event that Lineo is required by a
          third party software supplier to cease and to cause its Licensees and
          OEMs to cease use, reproduction and distribution of a particular
          version of the Licensed Products, Licensee agrees to comply herewith.

6.   CONFIDENTIAL INFORMATION

     a.   OBLIGATIONS. Each party (the "receiving party") acknowledges and
          agrees that any Confidential Information provided to the receiving
          party by the other party (the "disclosing party") hereunder
          constitutes the confidential and proprietary information of the
          disclosing party, and that the receiving party's protection thereof is
          essential to this Agreement and a condition to the receiving party's
          use and possession thereof. The receiving party shall retain in strict
          confidence and not disclose to any third party (except as authorized
          by this Agreement) without the disclosing party's express written
          consent, any and all such Confidential Information. Licensee
          acknowledges and agrees that the Licensed Products are confidential
          and proprietary information of Lineo.

     b.   EXCEPTIONS. The receiving party shall be relieved of this obligation
          of confidentiality to the extent any Confidential Information:

          (i)       was in the public domain at the time it was disclosed or has
                    become in the public domain through no fault of the
                    receiving party;

          (ii)      was known to the receiving party, without restriction, at
                    the time of disclosure as shown by the files of the
                    receiving party in existence at the time of disclosure (the
                    burden of proof of such knowledge being on the receiving
                    party);

          (iii)     is disclosed by the receiving party with the prior written
                    approval of the disclosing party;

          (iv)      the receiving party can prove was independently developed by
                    the receiving party without any use of the disclosing
                    party's confidential information and by employees or other
                    agents of the receiving party who have not had access to any
                    of the disclosing party's confidential information; or

          (v)       becomes known to the receiving party, without restriction,
                    from a source other than the disclosing party without breach
                    of this Agreement by the receiving party and otherwise not
                    in violation of the disclosing party's rights.

7.   LIMITED WARRANTIES

     a.   LIMITED WARRANTY. Lineo warrants and represents to Licensee that (i)
          the Licensed Products are either owned or properly licensed by Lineo
          or are in the public domain and the use thereof by Licensee, its
          representatives, OEM sublicensees or dealers will not infringe any
          U.S. patent, U.S. copyright or U.S. trademark; provided, however, that
          Licensee's obligations under Sections 7(d) and 8(a) shall be
          Licensee's sole remedy for any breach of this warranty; (ii) that for
          a period of 90 days from the date of delivery of Licensed Products,
          the media on which the Licensed Products are furnished will, under

License Agreement   Page 11 of 20  Lineo, Inc., 390 South 400 West, Lindon, Utah
<PAGE>

          normal use, be free from defects in materials and workmanship, failing
          which Lineo's sole obligation will be to replace the media; and (iii)
          Lineo has the full power to enter into this Agreement, to carry out
          its obligations under this Agreement and to grant the rights and
          licenses granted to Licensee in this Agreement.

     b.   END USER WARRANTY. If it is necessary for Licensee or an OEM to
          provide any warranty with respect to the Licensed Products to any End
          User, such warranty shall be limited to the warranties for software in
          the End User License Agreement set forth as Exhibit 3 to this Schedule
          B. Licensee is responsible for providing, or causing to be provided by
          its OEM sublicensees, a copy of the applicable End User License
          Agreement to End Users for their review at the time of acquisition or
          installation. Lineo does not warrant non-Licensed Products, which are
          provided by Lineo on an "AS IS" basis. Any warranty service for
          non-Licensed Products will be provided by the manufacturer of the
          products in accordance with the applicable manufacturer's warranty.

     c.   EXCLUSION OF WARRANTIES. EXCEPT AS SET FORTH IN THIS SECTION 7, LINEO
          EXPRESSLY DISCLAIMS AND EXCLUDES ALL WARRANTIES, EXPRESS OR IMPLIED,
          INCLUDING, WITHOUT LIMITATION, ANY WARRANTY OF TITLE OR
          NON-INFRINGEMENT (EXCEPT AS EXPRESSLY SET FORTH IN SECTION 7(a)(i)),
          AND ANY WARRANTIES AS TO THE SUITABILITY OR MERCHANTABILITY OR FITNESS
          FOR ANY PARTICULAR PURPOSE (EXCEPT AS EXPRESSLY SET FORTH IN SECTION
          7(a)(ii)). IN NO EVENT SHALL LINEO BE LIABLE FOR ANY LOST OR
          ANTICIPATED PROFITS, OR ANY INCIDENTAL, EXEMPLARY, SPECIAL OR
          CONSEQUENTIAL DAMAGES (INCLUDING LOST PROFITS), REGARDLESS OF WHETHER
          LINEO WAS ADVISED OF THE POSSIBILITY OF SUCH DAMAGES. THE WARRANTY IN
          THIS SECTION 7 SHALL NOT APPLY IF THE ERROR(S) ARE CAUSED BY ANY
          PROGRAMMING NOT CREATED BY LINEO, OR BY ANY REPAIRS, MODIFICATIONS OR
          ENHANCEMENT NOT MADE BY LINEO.

     d.   LIMITATION OF LIABILITY. Lineo's liability for direct damages to
          Licensee for any cause whatsoever, and regardless of the form of
          action, shall not exceed the amount received by Lineo from Licensee
          during the previous 12 months for the Licensed Products giving rise to
          such claim.

8.   INDEMNIFICATION

     a.   BY LINEO. Lineo agrees to defend Licensee and, to the extent of
          payments made by Licensee under this Agreement as set forth in Section
          7(d), to indemnify and hold Licensee harmless from any and all
          third-party claims, actions, demands, and related damages,
          liabilities, costs and expenses resulting from charges or allegations
          that a Licensed Product or Lineo Mark appropriately used, sold or
          distributed by Licensee infringes any U.S. patent, U.S. trademark, or
          U.S. copyright of any third party.

          Licensee shall permit Lineo to replace or modify any Licensed Products
          affected so as to avoid infringement or to procure the right for
          Licensee to continue use and marketing of such items. If neither
          alternative is possible or commercially reasonable, the infringing
          items shall be returned to Lineo, whose sole liability shall be to
          refund amounts paid by Licensee for the affected copies of the
          Licensed Products. Lineo shall have no liability for infringement
          based on (a) use, sale or distribution of other than the current
          release of the Licensed Products, or (b) modification of the Licensed
          Products by any party other than Lineo, or the combination or use of
          the Licensed Products with any other computer program, equipment,
          product, device, item or process not furnished by Lineo, if such
          infringement would have been avoided by the use of the Licensed
          Products alone and in their current unmodified form, or (c) other acts
          of Licensee or its OEM sublicensees.

License Agreement   Page 12 of 20  Lineo, Inc., 390 South 400 West, Lindon, Utah
<PAGE>

          THE ABOVE STATES THE ENTIRE LIABILITY OF LINEO WITH RESPECT TO
          INFRINGEMENT OF PATENTS, COPYRIGHTS, TRADEMARKS OR ANY OTHER FORM OF
          INTELLECTUAL PROPERTY RIGHT BY ANY PRODUCT SUPPLIED BY LINEO.

     b.   BY LICENSEE. Licensee agrees to indemnify, defend and hold Lineo
          harmless from and against any and all third-party claims, actions,
          demands, and related damages, liabilities, costs and expenses arising
          or resulting from, or related to, use, marketing, sale, distribution,
          modification, or other activities by Licensee or its OEM sublicensees
          under this Agreement or otherwise respecting the Licensed Products.

     c.   GENERAL CONDITIONS TO INDEMNITY RIGHTS. The forgoing rights and
          obligations of indemnity are conditioned on (i) prompt written
          notification from the indemnified party to the indemnifying party of
          the claim for which indemnity is sought; (ii) sole control in the
          indemnifying party of the defense of any action and all negotiations
          for settlement and compromise; and (iii) cooperation and assistance
          from the party seeking indemnification, including disclosure of
          information and authority necessary to perform the above. The
          indemnified party shall be responsible for the costs and fees of its
          own counsel if it desires to have separate legal representation in any
          such action.

9.   TERM AND TERMINATION

     a.   TERM AND EXTENSIONS. The initial term hereof shall be as provided in
          Schedule A. Unless earlier terminated for breach as provided herein,
          or unless either party notifies the other in writing, not later than
          30 days prior to expiration of the initial term, of its intention to
          terminate the Agreement upon said expiration, this Agreement shall
          automatically renew at the end of the initial term for successive
          twelve month terms. Either party may notify the other in writing of
          its intention to terminate this Agreement not later than 30 days prior
          to the expiration of any successive term.

     b.   TERMINATION FOR CAUSE. Either party may terminate this Agreement for
          the breach by the other party of a material term. The terminating
          party will first give the other party written notice of the breach and
          30 days in which to cure the alleged breach. If a cure is not achieved
          during the cure period, then the non-breaching party may terminate
          this Agreement upon written notice.

     c.   TERMINATION BY LINEO. Notwithstanding Section 9(b) hereof, Lineo may
          terminate this Agreement if Licensee fails to meet its payment
          obligations under this Agreement and this failure continues for 10
          days following receipt of written notice and demand from Lineo.

     d.   INSOLVENCY, ASSIGNMENT, OR BANKRUPTCY. Either party may, at its
          option, immediately terminate this Agreement upon written notice to
          the other party if the other party (i) admits in writing its inability
          to pay its debts generally as they become due; (ii) fails to make
          payment on any promissory note; (iii) makes a general assignment for
          the benefit of creditors or, in the case of a Korean entity, becomes
          the subject of a "workout"; (iv) institutes proceedings to be
          adjudicated a voluntary bankrupt, or consents to the filing of a
          petition of bankruptcy against it; (v) is adjudicated by a court of
          competent jurisdiction as being bankrupt or insolvent; (vi) seeks
          reorganization under any bankruptcy act or consents to the filing of a
          petition seeking such reorganization; or (vii) is the subject of a
          decree by a court of competent jurisdiction appointing a receiver,
          liquidator, trustee or assignee in bankruptcy or in insolvency
          covering all or substantially all of such party's property or
          providing for the liquidation of such party's property or business
          affairs.

     e.   ACCELERATION OF PAYMENT. Upon termination of this Agreement by Lineo
          under Section 9(a), 9(b) or 9(c) hereof, the due dates of all
          outstanding invoices to Licensee for

License Agreement   Page 13 of 20  Lineo, Inc., 390 South 400 West, Lindon, Utah
<PAGE>

          Licensed Products will automatically be accelerated so that they
          become due and payable on the effective date of termination, even if
          longer terms had been previously granted or allowed.

     f.   EFFECT OF TERMINATION ON OBLIGATIONS. Upon termination of this
          Agreement for any reason, Licensee shall (i) immediately cease all use
          and reproduction of the Licensed Products and shall cease use and
          distribution of all copies previously made; (ii) within 30 days after
          termination of this Agreement, either deliver to Lineo or destroy all
          copies of Licensed Products and Documentation in Licensee's possession
          or under its control, and furnish to Lineo an affidavit signed by an
          officer of Licensee certifying that, to the best of its knowledge,
          such delivery or destruction has been fully effected. Notwithstanding
          the foregoing, and provided Licensee fulfills its obligations
          specified in this Agreement with respect to such items, Licensee may
          continue to use and retain copies of the Licensed Products and
          Documentation to the extent, but only to the extent, necessary to
          support and maintain Licensed Products rightfully directly or
          indirectly distributed to OEMs and End Users by Licensee prior to
          termination of this Agreement; provided, however, that if any periodic
          fees or other payments would be payable by Licensee to Lineo in
          connection with any such Licensed Products (including without
          limitation Embedix SDK) if this Agreement had not terminated, such
          fees and other payments shall continue to be due and owing hereunder,
          and all other provisions of this Agreement shall remain in effect with
          respect to such Licensed Products so long as any amount remains
          payable hereunder. Termination of this Agreement shall not affect
          rights of OEMs or End Users receiving any Licensed Product bundled
          with or integrated in an OEM Product prior to the date of termination,
          provided, however, that Lineo shall have received payment of License
          Fees and other fees owing from Licensee therefor.

     g.   SURVIVAL OF TERMS. Termination of this Agreement shall not relieve
          either party of any obligations arising under this Agreement prior to
          the date of termination. Any provisions of this Agreement that by
          their nature extend beyond the termination of this Agreement,
          including specifically obligations owing under Sections 4, 5 and 7
          hereof, will survive and remain in effect until all obligations are
          satisfied. Confidentiality provisions shall remain in effect until the
          Confidential Information is no longer confidential.

10.  GENERAL PROVISIONS

     a.   PUBLIC ANNOUNCEMENTS AND PROMOTIONAL MATERIALS. Lineo and Licensee
          shall cooperate with each other either to issue a joint press release
          and/or to enable each party to issue and post to its web site an
          announcement concerning the entering into of this Agreement, provided
          that each party must approve any such press announcement prior to its
          release. Any subsequent announcement or release shall be subject to
          approval by both parties prior to publication of such release. Lineo
          shall have the right to use Licensee's name as a customer reference.

     b.   FORCE MAJEURE. If either party is prevented from performing any
          portion of this Agreement (except the payment of money) by causes
          beyond its control, including labor disputes, civil commotion, war,
          governmental regulations or controls, casualty, inability to obtain
          materials or services or acts of God, such defaulting party will be
          excused from performance for the period of the delay and for a
          reasonable time thereafter.

     c.   DISPUTE RESOLUTION. Any claim, dispute, difference or controversy
          arising under or with respect to this Agreement, other than a claim
          for specific enforcement or other injunctive relief, shall be resolved
          by arbitration before a panel of three arbitrators under the Rules of
          Conciliation and Arbitration of the International Chamber of Commerce.
          All arbitration proceedings shall be conducted in the English language
          and shall take place in Singapore. The determination of the
          arbitrators shall be final and may be enforced in any court of
          competent jurisdiction. The arbitrators shall be empowered to issue a
          decree of

License Agreement   Page 14 of 20  Lineo, Inc., 390 South 400 West, Lindon, Utah
<PAGE>

          specific performance pursuant to Section 10(d). All costs and expenses
          (including reasonable attorneys' fees and expenses) incurred by the
          prevailing party in connection with any claim asserted in any
          arbitration proceeding commenced pursuant to this Section shall be
          borne by the party against whom the award is made.

     d.   SPECIFIC PERFORMANCE. The parties hereby acknowledge that it is
          impossible to measure in money the damages which will accrue to any
          party hereto by reason of a failure of any other party hereto to
          perform any of its obligations provided for in this Agreement. The
          parties hereto will be irreparably damaged in the event that this
          Agreement is not specifically enforced, and in any suit, action or
          proceeding commenced pursuant to this Agreement an aggrieved party
          shall be entitled to a decree of specific performance to enforce the
          terms hereof. Such remedy, however, shall be cumulative and not
          exclusive and shall be in addition to any other remedy which any party
          shall have hereunder.

     e.   LIMITATION OF ACTIONS. No action arising or resulting from this
          Agreement, regardless of its form, may be brought by either party more
          than two years after termination of this Agreement.

     f.   THIRD PARTY CLAIMS. Neither party shall be liable for any claim by the
          other based on any third party claim, except as stated in Section 7 of
          this Agreement.

     g.   JURISDICTION. This Agreement will in all respects be governed by and
          construed in accordance with the laws of the State of New York of the
          United States of America, and will not be construed in accordance with
          or governed by the United Nations Convention for International Sales
          of Goods.

     h.   ATTORNEYS' FEES. If either Lineo or Licensee employs attorneys to
          enforce any rights arising out of or relating to this Agreement, the
          prevailing party shall be entitled to recover reasonable costs and
          attorneys' fees.

     i.   WAIVER. No waiver of any right or remedy on one occasion by either
          party will be deemed a waiver of that right or remedy on any other
          occasion.

     j.   SUPERIOR AGREEMENT. This Agreement will not be supplemented or
          modified by any course of dealing or usage of trade. Variance from or
          addition to the terms and conditions of this Agreement in any written
          notification or purchase order from Licensee will be of no effect,
          except for such variation otherwise expressly provided for in this
          Agreement and for such variation as may be agreed to by the parties in
          writing by express reference to this Section 10(j). This Agreement may
          be amended or modified only by a writing signed by each party.

     k.   ASSIGNMENT. This Agreement is not assignable by Licensee, in whole or
          in part, without Lineo's prior written consent. Lineo will not
          unreasonably withhold consent to an assignment of this Agreement or
          any part of this Agreement to a parent, subsidiary or affiliate of
          Licensee, provided that such entity is at least as capable as Licensee
          of satisfying Licensee's responsibilities hereunder. Any attempted
          assignment without Lineo's written consent will be null and void.

     l.   NOTICE. Unless otherwise agreed to by the parties, all notices
          required under this Agreement (except those relating to product
          pricing, changes and upgrades) will be deemed effective when received
          and made in writing to the address indicated on the Signature Page (or
          such other address as either party may notify to the other party), to
          the attention of the person designated as the responsible
          representative or to that person's successor, by (i) registered mail
          or certified mail, return receipt requested, commercial courier, (iii)
          overnight mail, or (iv) telephone facsimile transfer.

License Agreement   Page 15 of 20  Lineo, Inc., 390 South 400 West, Lindon, Utah
<PAGE>

     m.   SEVERABILITY. If any term, provision, covenant or condition of this
          Agreement is held invalid or unenforceable for any reason, the
          remainder of the provisions will continue in full force and effect as
          if this Agreement had been executed with the invalid portion
          eliminated. The parties further agree to substitute for the invalid
          provision a valid provision that most closely approximates the intent
          and economic effect of the invalid provision.

     n.   INDEPENDENT CONTRACTORS. Each party acknowledges that the parties to
          this Agreement are independent contractors and that it will not,
          except in accordance with this Agreement, represent itself as an agent
          or legal representative of the other.

     o.   COMPLIANCE WITH LAWS. Licensee represents and warrants that it shall
          comply at its own expense with all applicable laws, rules and
          regulations of governmental bodies and agencies, including all laws,
          rules and regulations affecting or governing exports, in its
          performance under this Agreement.

     p.   HEADINGS. The headings provided in this Agreement are for convenience
          only and will not be used in interpreting or construing this
          Agreement.

     q.   SCOPE OF AGREEMENT. Each of the parties hereto acknowledges that it
          has read this Agreement, understands it and agrees to be bound by its
          terms. The parties further agree that this Agreement is the complete
          and exclusive statement of agreement regarding the subject matter and
          supersedes all proposals (oral or written), understandings,
          representations, conditions, warranties, covenants and all other
          communications between the parties relating thereto. This Agreement
          may be amended only by a writing that refers specifically to this
          Agreement and is signed by both parties.

                * * * END OF STANDARD TERMS AND CONDITIONS * * *

License Agreement   Page 16 of 20  Lineo, Inc., 390 South 400 West, Lindon, Utah
<PAGE>

                             EXHIBIT 1 TO SCHEDULE B
                             TRADEMARK USAGE POLICY

                                    [TO COME]

License Agreement   Page 17 of 20  Lineo, Inc., 390 South 400 West, Lindon, Utah
<PAGE>

                             EXHIBIT 2 TO SCHEDULE B
                   CURRENT FORM OF END USER LICENSE AGREEMENT

                        LINEO END USER LICENSE AGREEMENT

IMPORTANT-READ CAREFULLY:

You have acquired an item ("Device") that includes software licensed to [OEM
Name] ("Company") by Lineo, Inc. ("Lineo"). This Lineo End User License
Agreement ("EULA") is a legal agreement between you (either an individual or a
single entity) and Lineo, Inc. ("Lineo") for the installed software product of
Lineo origin, as well as associated media, printed materials, and "online" or
electronic documentation ("Software"). Any product provided along with the
Software that is associated with a separate end user license agreement is
licensed to you under the terms of that license agreement. By installing,
copying, downloading, accessing, or otherwise using the Software, you agree to
be bound by the terms of this EULA. If you do not agree to the terms of this
EULA, do not use or install the Software. If you have purchased the Software,
promptly return the Software and all accompanying materials with proof of
purchase for a refund.

SOFTWARE LICENSE

The Software is protected by copyright laws and international copyright
treaties, as well as other intellectual property laws and treaties. The Software
is licensed, not sold.

1.   GRANT OF LICENSE. This EULA grants you the following rights: You may
     install and use the Software on a single CPU.

2.   OTHER RIGHTS AND LIMITATIONS

     -    LIMITATIONS ON REVERSE ENGINEERING, DECOMPILATION, AND DISASSEMBLY.
          You may not reverse engineer, decompile, or disassemble the Software,
          except and only to the extent that such activity is expressly
          permitted by applicable law notwithstanding this limitation.

     -    RENTAL. You may not rent, lease, sell, sublicense, or lend the
          Software.

     -    TRANSFER. You may permanently transfer rights under this EULA only as
          part of a permanent sale or transfer of the Device, and only if the
          recipient agrees to this EULA.

     -    RESERVATION OF RIGHTS. Lineo reserves all rights not expressly granted
          under this EULA.

3.   COPYRIGHT. Lineo and its suppliers retain all ownership of the Software and
     all copies thereof, provided, however, that certain components of the
     Software are components licensed under the GNU General Public License
     (version 2), which Lineo supports. You may obtain a copy of the GNU General
     Public License at www.gnudocs.com/GNU/COPYING. Lineo will provide source
     code for any of the components of the Software licensed under the GNU
     General Public License. To obtain such source code, send email to
     embedix-support@lineo.com. You may make up to ten copies of electronic
     documentation accompanying the Software for each license you have acquired
     for the Software. If you make copies, you must include all applicable
     copyright notices and other proprietary rights legends that come with the
     Software.

4.   EXPORT. You agree that you will not export or re-export the Software, any
     part thereof, or any process or service that is the direct product of the
     Software (the foregoing collectively referred to as the "Restricted
     Components"), to any country, person or entity subject to U.S. export
     restrictions. You specifically agree not to export or re-export any of the
     Restricted Components (i) to any country to which the U.S. has embargoed or
     restricted the export of goods or services, which currently include, but
     are not necessarily limited to Cuba, Iran, Iraq, Libya, North Korea, Sudan,
     Syria, and the Federal Republic of Yugoslavia (including Serbia, but not
     Montenegro), or

License Agreement   Page 18 of 20  Lineo, Inc., 390 South 400 West, Lindon, Utah
<PAGE>

     to any national of any such country, wherever located, who intends to
     transmit or transport the Restricted Components back to such country; (ii)
     to any person or entity who you know or have reason to know will utilize
     the Restricted Components in the design, development, or production of
     nuclear, chemical or biological weapons; or (iii) to any person or entity
     who has been prohibited from participating in U.S. export transactions by
     any federal agency of the U.S. Government. You warrant and represent that
     neither the Bureau of Export Administration of the U.S. Commerce Department
     nor any other U.S. federal agency has suspended, revoked, or denied your
     export privileges.

5.   GOVERNING LAW AND ATTORNEYS' FEES. This EULA is governed by the laws of the
     State of Utah, USA, excluding its conflict of laws rules, and specifically
     excludes the United Nations Convention on Contracts for the International
     Sale of Goods. If you acquired this Software in a country outside of the
     United States, that country's laws may apply. In any action or suit to
     enforce any right or remedy under this EULA or to interpret any provision
     of this EULA, the prevailing party will be entitled to recover its costs,
     including reasonable attorneys' fees.

6.   ENTIRE AGREEMENT. This EULA constitutes the entire agreement between you
     and Lineo with respect to the Software, and replaces all other agreements
     or representations, whether written or oral. The terms of this EULA cannot
     be modified by any terms in any printed forms used by the parties in
     performing the EULA, and can only be modified by express written consent of
     both parties. If any part of this EULA is held to be unenforceable as
     written, it will be enforced to the maximum extent allowed by applicable
     law, and will not affect the enforceability of any other part.

Should you have any questions concerning this EULA, or if you desire to contact
Lineo for any reason, please contact the Lineo representative serving your
company, or send email to: embedix-support@lineo.com.

THE FOLLOWING DISCLAIMER OF WARRANTY AND LIMITATION OF LIABILITY IS INCORPORATED
INTO THIS EULA BY REFERENCE.

NOT FAULT TOLERANT. THE SOFTWARE IS NOT FAULT TOLERANT. COMPANY HAS
INDEPENDENTLY DETERMINED HOW TO USE THE SOFTWARE IN THE DEVICE, AND LINEO HAS
RELIED UPON COMPANY TO CONDUCT SUFFICIENT TESTING TO DETERMINE THAT THE SOFTWARE
IS SUITABLE FOR SUCH USE.

NO WARRANTIES FOR THE SOFTWARE. THE SOFTWARE IS PROVIDED "AS IS" AND WITH ALL
FAULTS. THE ENTIRE RISK AS TO SATISFACTORY QUALITY, PERFORMANCE, ACCURACY, AND
EFFORT (INCLUDING LACK OF NEGLIGENCE) IS WITH YOU. ALSO, THERE IS NO WARRANTY
AGAINST INTERFERENCE WITH YOUR ENJOYMENT OF THE SOFTWARE OR AGAINST
INFRINGEMENT. IF YOU HAVE RECEIVED ANY WARRANTIES REGARDING THE DEVICE OR THE
SOFTWARE, THOSE WARRANTIES DO NOT ORIGINATE FROM, AND ARE NOT BINDING ON, LINEO.

NO LIABILITY FOR CERTAIN DAMAGES. EXCEPT AS PROHIBITED BY LAW, LINEO SHALL HAVE
NO LIABILITY FOR ANY INDIRECT, SPECIAL, CONSEQUENTIAL, OR INCIDENTAL DAMAGES
ARISING FROM OR IN CONNECTION WITH THE USE OR PERFORMANCE OF THE SOFTWARE. THIS
LIMITATION SHALL APPLY EVEN IF ANY REMEDY FAILS OF ITS ESSENTIAL PURPOSE. IN NO
EVENT SHALL LINEO BE LIABLE FOR ANY AMOUNT IN EXCESS OF THE LICENSE FEE PAID BY
COMPANY TO LINEO UNDER THIS EULA.

License Agreement   Page 19 of 20  Lineo, Inc., 390 South 400 West, Lindon, Utah
<PAGE>

                                   SCHEDULE C
                                 LICENSED MARKS

                                      Lineo

                                     Embedix

                                  Embedix Linux

                                   Embedix SDK

                                 Embedix Browser

                                     uCLinux

License Agreement   Page 20 of 20  Lineo, Inc., 390 South 400 West, Lindon, Utah
<PAGE>

Joint Venture Pricing           Schedule D       Do not redistribute or publish.
                                Lineo, Inc.
                            CONFIDENTIAL INFORMATION

                             EXHIBIT 1 TO SCHEDULE A

LINEO/SAMSUNG JOINT VENTURE
390 S 400 West
Lindon, Utah, 84042, USA
Tel: (801)426-5001
Fax: (801)426-6166

--------------------------------------------------------------------------------
        LINEO/SAMSUNG JOINT VENTURE PRICING- BASED ON ANNUAL COMMITMENTS
--------------------------------------------------------------------------------
Minimum Licenses                              1-3 Million      3-10 Million
Embedix LINUX             LIST PRICE                *             *
                          RESELLER                  *             *
                          JOINT VENTURE             *             *

Embedix BROWSER           LIST PRICE                *             *
                          RESELLER                  *             *
                          JOINT VENTURE             *             *

*INCLUDES EMBEDIX OS.
--------------------------------------------------------------------------------
Minimum Licenses                              1 copy     5 pack   Site License
                                                (must buy single copy first)
Embedix SDK               LIST PRICE            *           *          *
                          RESELLER              *           *          *
                          JOINT VENTURE         *           *          *

TERMS
--------------------------------------------------------------------------------

The "Joint Venture" noted in the price sheet refers to the Distributor; they are
the same entity, and the terms of the Agreement apply equally, regardless of
which name is used. Volume pricing for Embedix is derived on a commitment to
annual volumes. All Distributor pricing listed above is for products without
support. Maintenance (i.e., upgrades) is included in the Joint Venture price for
Embedix SDK, but not for Embedix Linux or Embedix Browser. Except where noted
below, terms for the initial order and for ongoing orders are the same. Pricing,
taxes, duties, and shipping terms for both the initial order and ongoing
purchase orders are noted below under "Pricing, Taxes and Duties" and
"Shipping".

TERMS FOR INITIAL ORDER:  As set forth in Initial Purchase Order.

STANDARD TERMS (FOR ONGOING SALES): Distributor will purchase 25% of contracted
volume, payable upon receipt of purchase order. Further payment of royalties
will occur on a quarterly basis reported at the beginning of each new calendar
quarter. Terms of NET 30 will be extended to Distributor. Payment terms shall be
dictated by the Distribution Agreement between the Distributor and Lineo. (Note:
These standard terms do not apply to the initial purchase order of $1,080,000.00
USD.) Payment for product shall be made in US dollars by credit cards, company
check, or wire transfer to the following account:

<TABLE>
<CAPTION>

<S>                       <C>                                       <C>                   <C>                     <C>
BANK             First Security Bank of Utah, Provo, Utah USA       SWIFT #  FSBUUS55     REMITTED BY:            (company name)
ACCOUNT NUMBER   033-00093-66                                       ROUTE #  124000012    INVOICE OR PO#:         (must be included)

</TABLE>

--------------------------------------------------------------------------------
PRICING, TAXES AND DUTIES
--------------------------------------------------------------------------------
The price or royalty fee of Lineo's products shall be set forth in Lineo's price
list in effect when Lineo accepts an order, less any applicable discounts.
Lineo's price list is subject to change without notice. Prices do not include
freight, insurance, custom's duties, or other similar charges. Unless otherwise
provided, the amount of any present or future sales, revenue, excise, use or
other taxes, fees, or charges of any nature imposed by a public authority
(local, state, nations or other) applicable to the product or its manufacture,
use or sale, will be added to the purchase price and paid by Distributor.
--------------------------------------------------------------------------------
SHIPPING
--------------------------------------------------------------------------------
All Lineo product is F.O.B., Utah, USA, unless otherwise specified. Title passes
to Distributor when product is delivered to carrier. In all cases, risk of loss
or damage to any product in transit shall fall upon Distributor. Lineo shall not
be responsible for any such claims with carrier. All shipments are sent UPS
Ground (US shipments) or UPS International (overseas shipments) unless an
alternate method of shipping is requested by Distributor.
--------------------------------------------------------------------------------

*MATERIAL HAS BEEN OMITTED PURSUANT TO A REQUEST FOR CONFIDENTIAL TREATMENT,
AND SUCH MATERIAL HAS BEEN FILED SEPARATELY WITH THE SEC.

<PAGE>

                                    EXHIBIT 2
                       SCHEDULE AND INITIAL PURCHASE ORDER

<TABLE>
<CAPTION>

<S>                                                                                       <C>
Finalize Shareholders Agreement, License Agreement &                                      September 21, 2000
Articles of Incorporation

Signing Ceremony - Shareholders Agreement                                                 September 22, 2000

Lineo Investment                                                                          September 26, 2000

Signing - License Agreement                                                                  October 2, 2000

Payment of initial order - Initial Licenses                                                 October 25, 2000

</TABLE>

<PAGE>

                                 PURCHASE ORDER

<TABLE>
<CAPTION>

------------------------------------------------------------------------------------------------------------
<S>                                                                       <C>
BILL TO:                                                                  PURCHASE ORDER
              Listech Ltd.                                                DATE: October 4, 2000
              C/o Samsung Electro-Mechanics Co.,
              Attention: Planning Department                              AUTHORIZED BY:
              314, Maetan-3 Dong, Paldal-Gu, Suwon
              Kyunggi-Do, Korea, 442-743                                  SHIP VIA:
              Voice: 82-331-210-6639
              Fax: 82-331-210-5965

ISSUED TO:    Lineo, Inc.                                                 SHIP TO ATTN.:
              390 South 400 West
              Lindon, UT 84042
              USA

TELEPHONE NUMBER: (801) 426-5001                                          SHIP BY (DATE):
------------------------------------------------------------------------------------------------------------
     QUANTITY                  DESCRIPTION              UNIT PRICE                 EXTENSION PRICE
                    Embedix Linux / Embedix Browser /   Per Price         1,080,000.00
                    Embedix SDK                         Schedule
                                                        attached to
                                                        form of License
                                                        Agreement
------------------------------------------------------------------------------------------------------------

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

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

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

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

------------------------------------------------------------------------------------------------------------
SPECIAL INSTRUCTIONS:                                         SUBTOTAL                         $1,080,000.00
                                                              TAX                                      $0.00
                                                              FREIGHT                                  $0.00
                                                              TOTAL DOLLAR VALUE               $1,080,000.00
------------------------------------------------------------------------------------------------------------
TERMS: All product in this order shall be non-refundable and non-returnable.  Payment of this initial order
will be made as follows:  *
 *
 *
 *
------------------------------------------------------------------------------------------------------------
 SIGNED:                                                                  DATE:
------------------------------------------------------------------------------------------------------------

</TABLE>

*MATERIAL HAS BEEN OMITTED PURSUANT TO A REQUEST FOR CONFIDENTIAL TREATMENT,
AND SUCH MATERIAL HAS BEEN FILED SEPARATELY WITH THE SEC.<PAGE>

                                   LINEO, INC.
                          EMPLOYEE STOCK PURCHASE PLAN

1.   DEFINITIONS

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

     "Common Stock" means common stock, par value $.001 per share, of the
     Company.

     "Company" means Lineo, Inc., a Delaware corporation, and any Participating
     Subsidiaries.

     "Compensation" means regular straight time earnings plus compensation for
     overtime, incentive bonuses and other additional compensation, except to
     the extent that any such item is specifically excluded by the Plan
     Administrator such as ordinary compensation income recognized attributable
     to an exercise of a non-qualified stock option, an early disposition of a
     qualified stock option or any ordinary income recognized attributable to
     stock acquired pursuant to the ESPP.

     "ESPP" means this Lineo, Inc. Employee Stock Purchase Plan.

     "Fair Market Value" of the Common Stock as of any day means the closing
     price (rounded to the next highest cent in the case of fractions of a cent)
     of the Common Stock as reported on such day or, if such day is not a
     trading day of the Nasdaq Stock Market, the next trading day as reported by
     the Nasdaq Stock Market, except that the "Fair Market Value" of the Common
     Stock as of the beginning of the first Purchase Period shall be the public
     offering price of the Common Stock in connection with the Company's initial
     public offering on such date. If the Common Stock of the Company is not
     admitted to trading on any of the aforesaid dates for which closing prices
     of the stock are to be determined, then reference shall be made to the fair
     market value of the stock on that date, as determined on such basis as
     shall be established or specified for the purpose by the Plan
     Administrator.

     "Participant" means an employee of the Company or a Participating
     Subsidiary who is regularly scheduled to work a minimum of fifteen (15)
     hours per week, who has met the eligibility requirements in Section 7 and
     has filed an Enrollment Agreement and such other documents as are required
     under Section 8.

     "Participating Subsidiary" means any corporation which is a "subsidiary
     corporation" of the Company within the meaning of Code Section 424(e) and
     is designated as a participant in the Plan by the Plan Administrator.

     "Plan Administrator" means the Board of Directors of the Company, or any
     committee established pursuant to Section 4 to administer the ESPP.

                                       1
<PAGE>

     "Purchase Period" means a twelve-month period commencing on each January 1
     or July 1, except the first Purchase Period that shall commence and end as
     provided in Section 6.

     "Purchase Date" means each December 31 and June 30 within or at the end of
     a Purchase Period, or, if such date does not occur on a business day, then
     the first business day immediately preceding such date.

2.   PURPOSE

     The purpose of this ESPP is to enable Participants to acquire a larger
personal proprietary interest in the Company, and to encourage Participants to
remain in the employ of the Company and have a personal interest in the success
of the Company. This ESPP is intended to constitute an "employee stock purchase
plan" as defined in Code Section 423, and shall be interpreted and administered
to further that intent.

     This ESPP is intended to provide Common Stock for investment and not for
resale. The Company does not, however, intend to restrict or influence the
conduct of any Participant's affairs. A Participant, therefore, may sell Common
Stock that is purchased under this ESPP at any time, subject to compliance with
any applicable federal or state tax and securities laws. THE EMPLOYEE ASSUMES
THE RISK OF ANY MARKET FLUCTUATIONS IN THE PRICE OF THE SHARES.

3.   GOVERNMENTAL REGULATIONS

     The Company's obligation to sell and deliver shares of Common Stock under
the ESPP is subject to the approval of any governmental authority required in
connection with the authorization, issuance or sale of such shares.

4.   ADMINISTRATION

     Primary authority for administration of the Plan is held by the Board of
Directors, but the Board of Directors, in its discretion, may establish a
committee composed of members of the Board of Directors or employees of the
Company to administer the Plan which shall have such of the power and authority
vested in the Board of Directors under the Plan as the Board of Directors may
delegate to it, including the power and authority to interpret any provision of
the Plan. The Board of Directors or any committee established pursuant to this
Section 4 is referred to herein as the "Plan Administrator." It is the intention
of the Company that the ESPP and the administration hereof comply in all
respects with Section 16(b) of the Securities Exchange Act of 1934 and Section
423(b) of the Code.

                                       2
<PAGE>

5.   STOCK SUBJECT TO THE ESPP

     There are reserved for issuance under the ESPP 2,000,000 shares of Common
Stock which may be purchased by Participants pursuant to the ESPP, subject to
adjustment as provided in Section 17.

6.   PURCHASE PERIODS

     This ESPP will be administered based on annual Purchase Periods commencing
January 1 and July 1 of each calendar year and ending twelve months later on
December 31 or June 30, respectively; provided, however, that the first Purchase
Period will begin on the effective date of the Company's registration statement
filed in connection with the Company's initial public offering and end on
December 31, 2002, or if earlier, a date that is exactly 27 months after the
beginning of such first Purchase Period. The second Purchase Period shall begin
on the next January 1 or July 1 following the beginning of the first Purchase
Period and end twelve months later, and so forth.

7.   ELIGIBILITY

     Any employee who has completed thirty (30) days employment and who is
employed on the date his or her participation is to begin shall be eligible to
participate in Purchase Periods beginning after such thirty (30) day period.

     For purposes of participation in the ESPP, a person on leave of absence
shall be deemed to be an employee for the first ninety (90) days of such leave
of absence and such person's employment shall be deemed to have terminated at
the close of business on the 90th day of such leave of absence unless such
person shall have returned to regular full-time or part-time employment (as the
case may be) prior to the close of business on such 90th day. Termination by the
Company of a person's leave of absence, other than termination of such leave of
absence on return to full time or part time employment, shall terminate a
person's employment for all purposes of the ESPP and shall terminate such
person's participation in the ESPP and right to purchase shares of stock
pursuant to the ESPP.

8.   PARTICIPATION

     An eligible employee may become a Participant by completing, signing and
filing an Enrollment Agreement authorizing payroll deductions and any other
necessary papers with the Company at least ten (10) days prior to the
commencement of the particular Purchase Period in which he or she wishes to
participate. An employee shall not participate in a new Purchase Period while
such employee is a Participant in an earlier Purchase Period unless such
employee withdraws or discontinues his or her participation in such earlier
Purchase Period pursuant to Section 12 and becomes a Participant in the later
Purchase Period by satisfying the requirements of this Section 8 and so long as
the limitations of Section 11 are not exceeded.

                                       3
<PAGE>

9.   PAYROLL DEDUCTIONS

     At the time a Participant files his or her Enrollment Agreement, he or she
may elect to have from 1% to 20% (1% to 25% election with respect to the portion
of the first Purchase Period ending December 31, 2000, with any percentage
election in excess of 20% for this period automatically reverting to the maximum
allowable percentage election of 20% and any percentage 20% or less election
remaining unchanged effective January 1, 2001) (in whole percentage points) of
his or her Compensation deducted and applied to the purchase of shares of Common
Stock pursuant to this ESPP. An amount equal to the elected percentage of the
Participant's Compensation will be deducted on each regular pay day falling
within the Purchase Period. All amounts will be deducted from a Participant's
Compensation on an after-tax basis. No interest will be paid on payroll
deductions accumulated under the ESPP. A Participant may discontinue
participation or withdraw from the ESPP as provided in Section 12 and may alter
the amount of his or her payroll deductions or make any other changes during a
Purchase Period, subject to the limitations of Section 11, by completing and
delivering to the Company an ESPP Change Notice. Any such changes shall be made
by the Company as soon as reasonably practicable.

     If a Participant goes on a leave of absence, such Participant shall have
the right, subject to the provisions of Section 7, to elect: (a) to withdraw his
or her accumulated payroll deductions pursuant to Section 12; (b) to discontinue
payroll deductions but remain a Participant in the ESPP during such leave of
absence, or (c) remain a Participant in the ESPP during such leave of absence,
authorizing deductions to be made from payments by the Company to the
Participant during such leave of absence and undertaking to make cash payments
to the Company at the end of each payroll period to the extent that amounts
payable by the Company to such Participant are insufficient to meet such
Participant's authorized Plan deductions.

10.  PURCHASE OF COMMON STOCK

     Unless a Participant withdraws from the ESPP prior to a particular Purchase
Date as provided in Section 12, on each Purchase Date, a Participant's
accumulated payroll deductions will, subject to the limitations in Section 11
and the termination provisions of Section 16, be applied toward the purchase of
shares of Common Stock at a purchase price equal to the lesser of:

     (a)  85% of the Fair Market Value of the Common Stock on the first business
          day of the Purchase Period; or

     (b)  85% of the Fair Market Value of the Common Stock on the Purchase Date,

in either event rounded to the nearest whole cent.

     Shares of Common Stock may be purchased under the ESPP only with a
Participant's accumulated payroll deductions. Fractional shares cannot be
purchased. The Company will return to the Participant any portion of a
Participant's accumulated payroll deductions not used

                                       4
<PAGE>

for the purchase of Common Stock at the end of a Purchase Period. Upon a
Participant's withdrawal from the ESPP pursuant to Section 12, the Company will
return to the Participant the Participant's accumulated payroll deductions as
provided in Section 12.

11.  LIMITATIONS ON SHARE PURCHASES

     During any calendar year, the maximum value of the Common Stock that may be
purchased by a Participant under all Purchase Periods of the ESPP and all other
Code Section 423 plans of the Company and its subsidiaries is $25,000, said
value to be determined on the basis of the Fair Market Value of the Common Stock
on the first business day of the Purchase Period and in accordance with the
requirements of Code Section 423(b)(8). The foregoing limitation is intended to
and shall be interpreted in such a manner as will comply with Code Section
423(b)(8). In addition, no Participant shall be permitted to subscribe for any
shares under the ESPP if such Participant, immediately after such subscription,
owns shares that account for (including all shares that may be purchased under
outstanding subscriptions under the ESPP and any other outstanding options to
purchase shares of Common Stock) five percent (5%) or more of the total combined
voting power or value of all classes of shares of the Company or its
subsidiaries, taking into account the stock ownership rules in Code Section
424(d).

12.  WITHDRAWAL AND DISCONTINUANCE

     A Participant may withdraw from the ESPP, in whole but not in part, prior
to a particular Purchase Date by completing the "discontinue and withdraw"
section of an ESPP Change Notice and delivering the ESPP Change Notice to the
Company no later than seven days prior to the Purchase Date, in which event the
Company will refund the entire balance of his accumulated payroll deductions as
soon as practicable thereafter.

     To re-enter the ESPP, a Participant who has previously withdrawn must file
a new Enrollment Agreement in accordance with Section 8. His re-entry into the
ESPP cannot, however, become effective before the beginning of the next Purchase
Period following his withdrawal.

     A Participant may elect to discontinue his payroll deductions during the
course of a particular Purchase Period, at any time prior to the last day of the
pay period (pay periods end on the Friday before each pay day) during such
Purchase Period, by completing the "discontinue" section of an ESPP Change
Notice and delivering the ESPP Change Notice to the Company, and such election
will not constitute a withdrawal for purpose of this Section 12. In the event
that a Participant elects to discontinue his payroll deductions pursuant to this
Section 12, the Participant will continue to participate in such Purchase Period
and will be entitled to purchase from the Company such number of full shares of
Common Stock as set forth in and in accordance with Section 10.

                                       5
<PAGE>

13.  ISSUANCE OF COMMON STOCK TO CUSTODIAL ACCOUNTS

     The shares of Common Stock purchased by a Participant will be issued
electronically by the Company's transfer agent to the Participant's custodial
account as soon as practicable after each Purchase Date. Common Stock purchased
under the ESPP will be issued only in the name of the Participant (or, if his
authorization so designates, in the name of the Participant and another person
of legal age as joint tenants with rights of survivorship). The custodial
account of Participants shall be maintained by a bank, broker-dealer or similar
custodian appointed by the Plan Administrator that has agreed to hold such
shares for the accounts of the respective Participants. Fees and expenses of the
bank, broker-dealer or similar custodian shall be paid by the Company or
allocated among the respective Participants in such manner as the Plan
Administrator determines. A Participant or his legal representative may sell
Common Stock from his custodial account at any time; however, any sale within
two (2) years of the first day of the Purchase Period and one (1) year of the
Purchase Date will be treated by the Company as a disqualifying disposition
under the Code and be reported on the Participant's tax Form W-2.

14.  WITHHOLDING TAXES

     In connection with the purchase of shares of Common Stock under the ESPP,
the Company (a) shall not issue a certificate for such shares until it has
received payment from the Participant of any required withholding tax in cash or
by the retention or acceptance upon delivery thereof by the Participant of
shares of Common Stock sufficient in Fair Market Value to cover the amount of
such withholding tax and (b) shall have the right to retain or sell without
notice, or to demand surrender of, shares of Common Stock in value sufficient to
cover any withholding tax. The Company shall have the right to withhold from any
payroll deductions made by the Participant under the ESPP an amount equal to any
required withholding tax. In either case, the Company shall make payment (or
reimburse itself for payment made) to the appropriate taxing authority of an
amount in cash equal to the amount of such withholding tax, remitting any
balance to the Participant. For purposes of this Section 14, the value of shares
of Common Stock so retained or surrendered shall be equal to the Fair Market
Value of such shares on the date that the amount of the withholding tax is to be
determined (the "Tax Date"), and the value of shares of Common Stock so sold
shall be the actual net sale price per share (after deduction of commissions)
received by the Company. Further, to the extent required by applicable tax laws,
the Company shall require the Participant to pay withholding taxes in connection
with a disposition of any shares acquired under the ESPP that does not occur
after the date that is both two years after the date of the beginning of the
applicable Purchase Period (the option grant date) and one year after the
applicable Purchase Date (the option exercise date). In connection with the
payment of such withholding taxes, the Company shall have the same rights as
those granted immediately above. Notwithstanding the foregoing, the Participant
may elect, subject to approval by the Plan Administrator, to satisfy the
obligation to pay any withholding tax, in whole or in part, by providing the
Company with funds sufficient to enable the Company to pay such withholding tax
or by having the Company retain or accept upon delivery thereof by the
Participant shares of Common Stock sufficient in Fair Market Value to cover the
amount of

                                       6
<PAGE>

such withholding tax. Each election by a Participant to have shares retained or
to deliver shares for this purpose must be in writing and made on or prior to
the Tax Date.

15.  TRANSFERABILITY

     A Participant's rights under the ESPP, including rights to accumulated
payroll deductions, may not be pledged, assigned, encumbered or otherwise
transferred for any reason other than by will or the laws of descent and
distribution. Any such attempt will be treated as an election by the Participant
to withdraw from the ESPP.

16.  TERMINATING EVENTS

     Upon (a) the dissolution or liquidation of the Company, (b) a merger or
other reorganization of the Company with one or more corporations as a result of
which the Company will not be a surviving corporation, (c) the sale of all or
substantially all of the assets of the Company or a material division of the
Company, (d) a sale or other transfer, pursuant to a tender offer or otherwise,
of more than fifty percent (50%) of the then outstanding shares of Common Stock
of the Company, (e) an acquisition by the Company resulting in an extraordinary
expansion of the Company's business or the addition of a material new line of
business, or (f) any exchange that is subject to this Section 16 (any of such
events is herein referred to as a "Terminating Event"), the Plan Administrator
may but shall not be required to:

          (a)  make provision for the continuation of the Participants' rights
     under the ESPP on such terms and conditions as the Plan Administrator
     determines to be appropriate and equitable, including where applicable, but
     not limited to, an arrangement for the substitution on an equitable basis,
     for each share of Common Stock that could otherwise be purchased at the end
     of the Purchase Periods in progress at the time of the Terminating Event,
     of any consideration payable with respect to each then outstanding share of
     Common Stock in connection with the Terminating Event; or

          (b)  terminate all rights of Participants under the ESPP for such
     Purchase Periods and --

               (i)  return to the Participants all of their payroll deductions
                    for such Purchase Periods; and

               (ii) for each share of Common Stock, if any, that could otherwise
                    be purchased under the ESPP by a Participant at the end of
                    such Purchase Periods (determined by assuming that payroll
                    deductions at the rate elected by the Participant were
                    continued to the end of the Purchase Periods and used to
                    purchase shares based on the Fair Market Value of the Common
                    Stock on the first day of the Purchase Periods) and with
                    respect to which (A) the purchase price at which such share
                    could be purchased (determined with reference

                                       7
<PAGE>

                    only to the Fair Market Value of the Common Stock on the
                    first day of the Purchase Periods) is exceeded by (B) the
                    Fair Market Value on the date of the Terminating Event of a
                    share of Common Stock, as determined by the Plan
                    Administrator, pay to the Participant an amount equal to
                    such excess.

     The Plan Administrator shall make all determinations necessary or advisable
in connection with Terminating Events, and its determinations shall, in the
absence of fraud or patent mistake, be conclusive and binding on all persons
with any interest in the ESPP.

17.  ADJUSTMENTS UPON CHANGES IN CAPITALIZATION

     In the event of any changes in the outstanding stock of the Company by
reason of stock dividends, stock splits, recapitalizations, mergers,
consolidations, combinations or exchanges of shares, split-ups, split-offs,
spin-offs, liquidations or other similar changes in capitalization, or any
distribution to stockholders other than cash dividends, the Plan Administrator
shall make such adjustments, if any, in light of the change or distribution as
the Plan Administrator in its sole discretion shall determine to be appropriate
in the number and class of shares and the purchase prices of the Common Stock
which may be purchased by Participants during the Purchase Periods then in
process. In the event of any such change in the outstanding Common Stock of the
Company, the aggregate number and class of shares available under the ESPP and
the maximum number of shares which may be purchased and their purchase price
shall be appropriately adjusted by the Plan Administrator.

     Upon the happening of an event specified in this Section 17, the class and
aggregate number of shares available under the ESPP, as set forth in Section 5
shall be appropriately adjusted to reflect the event. Notwithstanding the
foregoing, such adjustments shall be made only to the extent that the Plan
Administrator, based on advice of counsel for the Company, determines that such
adjustments will not constitute a change requiring shareholder approval under
Code Section 423(b)(2).

18.  TERMINATION OF EMPLOYEE'S RIGHTS

     Subject to the provisions of Section 20, a Participant's rights under the
ESPP will terminate if he or she for any reason (including death, disability or
voluntary or involuntary termination of employment) ceases to be an employee of
the Company. To the extent that the rights of a Participant terminate in
accordance with this Section 18, any of the Participant's accumulated payroll
deductions will be promptly returned to the Participant or in the case of the
Participant's death, to his or her beneficiary as provided in Section 19 below.
The ESPP does not, directly or indirectly, create any right for the benefit of
any employee or class of employees to preferentially purchase any Common Stock
under the ESPP, or create in any employee or class of employees any right with
respect to continuation of employment by the Company, and it shall not be deemed
to interfere in any way with the Company's right to terminate, or otherwise
modify, an employee's employment at any time.

                                       8
<PAGE>

19.  DESIGNATION OF BENEFICIARY

     A Participant may designate a beneficiary who is to receive any accumulated
payroll deductions upon the Participant's death. Such designation may be changed
by the Participant at any time by completing the "beneficiary designation"
section of an ESPP Change Notice and delivering the ESPP Change Notice to the
Plan Administrator. Upon the death of a Participant and upon receipt by the
Company of proof of identity, the Company shall deliver such accumulated payroll
deductions to such beneficiary. In the event of the death of a Participant and
in the absence of a beneficiary validly designated under the Plan who is living
at the time of such Participant's death, the Company shall deliver such
accumulated payroll deductions to the executor or personal representative of the
Participant's estate or if no executor or personal representative has been
appointed (to the knowledge of the Company), the Company, in its discretion, may
deliver such accumulated payroll deductions to the spouse or to any one or more
dependents of the Participant as the Company may designate. No beneficiary
shall, prior to the death of the Participant by whom he or she has been
designated, acquire any interest in the Participant's accumulated payroll
deductions.

20.  TERMINATION AND AMENDMENTS TO ESPP

     The ESPP may be terminated at any time by the Plan Administrator but,
except as provided in Section 16, such termination shall not affect the rights
of Participants under the ESPP for the Purchase Period in progress at the time
of termination. The ESPP will terminate in any case when all or substantially
all of the unissued shares of Common Stock reserved for the purposes of the ESPP
have been purchased. If at any time shares of Common Stock reserved for the
purpose of the ESPP remain available for purchase but not in sufficient number
to satisfy all then unfilled purchase requirements, the available shares shall
be apportioned among Participants in proportion to the respective amounts of
their accumulated payroll deductions, and the ESPP shall terminate. Upon such
termination or any other termination of the ESPP, all accumulated payroll
deductions not used to purchase shares of Common Stock will be refunded to the
Participants entitled thereto. The ESPP may be terminated, modified or amended
by the shareholders of the Company. The Board of Directors of the Company may
also terminate this ESPP, or modify or amend the ESPP in such respects as it
shall deem advisable in order to conform to any change in any law or regulation
applicable thereto, or in other respects; however, to the extent required by
applicable law or regulation, shareholder approval will be required for any
amendment which will (a) increase the total number of shares which may be issued
under the ESPP, (b) change the class of persons eligible to purchase Common
Stock under the ESPP, (c) materially increase the benefits accruing to
Participants under the ESPP, or (d) otherwise require shareholder approval under
any applicable law or regulation.

21.  INFORMATION TO PARTICIPANTS

     A Participant in the ESPP shall not have any rights as a shareholder of the
Company on account of shares of Common Stock that may be purchased under the
ESPP prior to the time such shares are actually purchased by and issued to the
Participant. Notwithstanding the

                                       9
<PAGE>

foregoing, the Company shall deliver to each Participant under the ESPP who does
not otherwise receive such materials (a) a copy of the Company's annual
financial statements, together with management's discussion and analysis of
financial condition and results of operations for the fiscal year, and (b) a
copy of all reports, proxy statements and other communications distributed to
the Company's security holders generally.

22.  APPROVAL OF STOCKHOLDERS

     The ESPP will become effective on the effective date of the Company's
registration statement filed in connection with the Company's initial public
offering, subject to approval by the holders of a majority of the shares of the
Company present or represented by proxy at an annual meeting of the stockholders
of the Company held within one year after the date on which the ESPP is adopted
by the Board of Directors of the Company. The ESPP shall also be subject to
approval by the stockholders of the Company in a manner that complies with
Section 423(b)(2) of the Code. If the ESPP is not so approved, it shall not
become effective, and all payroll deductions of Participants accumulated under
the ESPP will be promptly returned to the Participants.

     Date Approved by Board of Directors: August 29, 2000.

     Date Approved by Shareholders: _______________, 2000.

                                       10

Source: [{"source": "alea-institute/alea-institute/kl3m-data-edgar-agreements/train-00016-of-00352.parquet"}, [{"source": "alea-institute/alea-institute/kl3m-data-edgar-agreements/train-00016-of-00352.parquet"}]]