Document:

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                                      WARRANT

THIS WARRANT AND THE SHARES OF COMMON STOCK ISSUABLE UPON
EXERCISE HEREOF HAVE NOT BEEN REGISTERED UNDER THE SECURITIES ACT
OF 1933, AS AMENDED (THE "SECURITIES ACT"), OR ANY STATE SECURITIES
LAWS AND MAY NOT BE SOLD, TRANSFERRED OR OTHERWISE DISPOSED OF
UNLESS REGISTERED UNDER THE SECURITIES ACT AND UNDER APPLICABLE
STATE SECURITIES LAWS OR ESYNCH CORPORATION SHALL HAVE RECEIVED
AN OPINION OF ITS COUNSEL THAT REGISTRATION OF SUCH SECURITIES UNDER
THE SECURITIES ACT AND UNDER THE PROVISIONS OF APPLICABLE STATE
SECURITIES LAWS IS NOT REQUIRED.

                                WARRANT TO PURCHASE

                               SHARES OF COMMON STOCK

                                         OF

                                 ESYNCH CORPORATION

                             Expires [B]________, 2002
No.: W-J-[A]                                           Number of Shares: [C]___
Date of Issuance: [D]_____, 1999

       FOR VALUE RECEIVED, subject to the provisions hereinafter set forth, the
undersigned, eSynch Corporation, a Delaware corporation (together with its
successors and assigns, the "Issuer"), hereby certifies that
[E]________________________ or its registered assigns is entitled to subscribe
for and purchase, during the period specified in this Warrant, up to [C]______
shares (subject to adjustment as hereinafter provided) of the duly authorized,
validly issued, fully paid and non-assessable Common Stock of the Issuer, at an
exercise price per share equal to the Warrant Price then in effect, subject,
however, to the provisions and upon the terms and conditions hereinafter set
forth. Capitalized terms used in this Warrant and not otherwise defined herein
shall have the respective meanings specified in Section 7 hereof

       1.     Term. The right to subscribe for and purchase shares of Warrant
Stock represented hereby shall commence on the date of issuance of this Warrant
and shall expire at 5:00 p.m., pacific time, on [B]_________, 2002 (such period
being the "Term").

       2.     METHOD OF EXERCISE PAYMENT: ISSUANCE OF NEW WARRANT: TRANSFER AND
EXCHANGE.

       (a)    TIME OF EXERCISE. The purchase rights represented by this Warrant
may be exercised in whole or in part at any time and from time to time during
the Term.

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       (b)    METHOD OF EXERCISE. The Holder hereof may exercise this Warrant,
in whole or in part, by the surrender of this Warrant (with the exercise form
attached hereto duly executed) at the principal office of the Issuer, and by the
payment to the Issuer of an amount of consideration therefor equal to the
Warrant Price in effect on the date of such exercise multiplied by the number of
shares of Warrant Stock with respect to which this Warrant is then being
exercised, payable at such Holder's election (i) by certified or official bank
check or (ii) by surrender to the Issuer for cancellation of a portion of this
Warrant representing that number of unissued shares of Warrant Stock which is
equal to the quotient obtained by dividing (A) the product obtained by
multiplying the Warrant Price by the number of shares of Warrant Stock being
purchased upon such exercise by (B) the difference obtained by subtracting the
Warrant Price from the Per Share Market Value as of the date of such exercise,
or (iii) by a combination of the foregoing methods of payment selected by the
Holder of this Warrant. In any case where the consideration payable upon such
exercise is being paid in whole or in part pursuant to the provisions of clause
(ii) of this subsection (b), such exercise shall be accompanied by written
notice from the Holder of this Warrant specifying the manner of payment thereof
and containing a calculation showing the number of shares of Warrant Stock with
respect to which rights are being surrendered thereunder and the net number of
shares to be issued after giving effect to such surrender.

       (c)    ISSUANCE OF STOCK CERTIFICATES. In the event of any exercise of
the rights represented by this Warrant in accordance with and subject to the
terms and conditions hereof, (i) certificates for the shares of Warrant Stock so
purchased shall be dated the date of such exercise and delivered to the Holder
hereof within a reasonable time, not exceeding three Trading Days after such
exercise, and the Holder hereof shall be deemed for all purposes to be the
Holder of the shares of Warrant Stock so purchased as of the date of such
exercise, and (ii) unless this Warrant has expired, a new Warrant representing
the number of shares of Warrant Stock, if any, with respect to which this
Warrant shall not then have been exercised (less any amount thereof which shall
have been canceled in payment or partial payment of the Warrant Price as
hereinabove provided) shall also be issued to the Holder hereof at the Issuer's
expense within such time.

       (d)    TRANSFERABILITY OF WARRANT. Subject to Section 2(e), this Warrant
may be transferred by a Purchaser without the consent of the Company. If
transferred pursuant to this paragraph and subject to the provisions of
subsection (e) of this Section 2, this Warrant may be transferred on the books
of the Issuer by the Holder hereof in person or by duly authorized attorney,
upon surrender of this Warrant at the principal office of the Issuer, properly
endorsed (by the Holder executing an assignment in the form attached hereto) and
upon payment of any necessary transfer tax or other governmental charge imposed
upon such transfer. This Warrant is exchangeable at the principal office of the
Issuer for Warrants for the purchase of the same aggregate number of shares of
Warrant Stock, each new Warrant to represent the right to purchase such number
of shares of Warrant Stock as the Holder hereof shall designate at the time of
such exchange. All Warrants issued on transfers or exchanges shall be dated the
Original Issue Date and shall be identical with this Warrant except as to the
number of shares of Warrant Stock issuable pursuant hereto.

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(e)    COMPLIANCE WITH SECURITIES LAWS.

              (i)    The Holder of this Warrant, by acceptance hereof,
       acknowledges that this Warrant or the shares of Warrant Stock to be
       issued upon exercise hereof are being acquired solely for the Holder's
       own account and not as a nominee for any other party, and for investment,
       and that the Holder will not offer, sell or otherwise dispose of this
       Warrant or any shares of Warrant Stock to be issued upon exercise hereof
       except pursuant to an effective registration statement, or an exemption
       from registration, under the Securities Act and any applicable state
       securities laws.

              (ii)   Except as provided in paragraph (iii) below, this Warrant
       and all certificates representing shares of Warrant Stock issued upon
       exercise hereof shall be stamped or imprinted with a legend in
       substantially the following form:

                     THIS WARRANT AND THE SHARES OF COMMON
              STOCK ISSUABLE UPON EXERCISE HEREOF HAVE NOT
              BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933,
              AS AMENDED (THE "SECURITIES ACT"), OR ANY STATE
              SECURITIES LAWS AND MAY NOT BE SOLD, TRANSFERRED
              OR OTHERWISE DISPOSED OF UNLESS REGISTERED
              UNDER THE SECURITIES ACT AND UNDER APPLICABLE
              STATE SECURITIES LAWS OR ESYNCH CORPORATION
              SHALL HAVE RECEIVED AN OPINION OF ITS COUNSEL
              THAT REGISTRATION OF SUCH SECURITIES UNDER THE
              SECURITIES ACT AND UNDER THE PROVISIONS OF
              APPLICABLE STATE SECURITIES LAWS IS NOT REQUIRED.

              (iii)  The restrictions imposed by this subsection (e) upon the
       transfer of this Warrant or the shares of Warrant Stock to be purchased
       upon exercise hereof shall terminate (A) when such securities shall have
       been resold pursuant to being effectively registered under the Securities
       Act, (B) upon the Issuer's receipt of an opinion of counsel, in form and
       substance reasonably satisfactory to the Issuer, addressed to the Issuer
       to the effect that such restrictions are no longer required to ensure
       compliance with the Securities Act and state securities laws or (C) upon
       the Issuer's receipt of other evidence reasonably satisfactory to the
       Issuer that such registration and qualification under state securities
       laws is not required. Whenever such restrictions shall cease and
       terminate as to any such securities, the Holder thereof shall be entitled
       to receive from the Issuer (or its transfer agent and registrar), without
       expense (other than applicable transfer taxes, if any), new Warrants (or,
       in the case of shares of Warrant Stock, new stock certificates) of like
       tenor not bearing the applicable legend required by paragraph (ii) above
       relating to the Securities Act and state securities laws.

       (f)    CONTINUING RIGHTS OF HOLDER. The Issuer will, at the time of or at
any time after each exercise of this Warrant, upon the request of the Holder
hereof, acknowledge in writing the extent, if any, of its continuing obligation
to afford to such Holder all rights to which such Holder shall continue to be
entitled after such exercise in accordance with the terms of this Warrant,
PROVIDED that

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if any such Holder shall fail to make any such request, the failure shall not
affect the continuing obligation of the Issuer to afford such rights to such
Holder.

       3.     STOCK FULLY PAID: RESERVATION AND LISTING OF SHARES: COVENANTS.

       (a)    STOCK FULLY PAID. The Issuer represents, warrants, covenants and
agrees that all shares of Warrant Stock which may be issued upon the exercise of
this Warrant or otherwise hereunder will, upon issuance, be duly authorized,
validly issued, fully paid and non-assessable and free from all taxes, liens and
charges created by or through Issuer. The Issuer further covenants and agrees
that during the period within which this Warrant may be exercised, the Issuer
will at all times have authorized and reserved for the purpose of the issue upon
exercise of this Warrant a sufficient number of shares of Common Stock to
provide for the exercise of this Warrant.

       (b)    RESERVATION. If any shares of Common Stock required to be reserved
for issuance upon exercise of this Warrant or as otherwise provided hereunder
require registration or qualification with any governmental authority under any
federal or state law before such shares may be so issued, the Issuer will in
good faith use its best efforts as expeditiously as possible at its expense to
cause such shares to be duly registered or qualified. If the Issuer shall list
any shares of Common Stock on any securities exchange or market it will, at its
expense, list thereon, maintain and increase when necessary such listing, of,
all shares of Warrant Stock from time to time issued upon exercise of this
Warrant or as otherwise provided hereunder, and, to the extent permissible under
the applicable securities exchange rules, all unissued shares of Warrant Stock
which are at any time issuable hereunder, so long as any shares of Common Stock
shall be so listed. The Issuer will also so list on each securities exchange or
market, and will maintain such listing of, any other securities which the Holder
of this Warrant shall be entitled to receive upon the exercise of this Warrant
if at the time any securities of the same class shall be listed on such
securities exchange or market by the Issuer.

       (c)    COVENANTS. The Issuer shall not by any action including, without
limitation, amending the Certificate of Incorporation or the by-laws of the
Issuer, or through any reorganization, transfer of assets, consolidation,
merger, dissolution, issue or sale of securities or any other action, avoid or
seek to avoid the observance or performance of any of the terms of this Warrant,
but will at all times in good faith assist in the carrying out of all such terms
and in the taking of all such actions as may be necessary or appropriate to
protect the rights of the Holder hereof against dilution (to the extent
specifically provided herein) or impairment. Without limiting the generality of
the foregoing, the Issuer will (i) not permit the par value, if any, of its
Common Stock to exceed the then effective Warrant Price, (ii) not amend or
modify any provision of the Certificate of Incorporation or by-laws of the
Issuer in any manner that would adversely affect in any way the powers,
preferences or relative participating, optional or other special rights of the
Common Stock or which would adversely affect the rights of the Holders of the
Warrants, (iii) take all such action as may be reasonably necessary in order
that the Issuer may validly and legally issue fully paid and nonassessable
shares of Common Stock, free and clear of any liens, claims, encumbrances and
restrictions (other than as provided herein) upon the exercise of this Warrant,
and (iv) use its best efforts to obtain all such authorizations, exemptions or
consents from any public regulatory body having jurisdiction thereof as may be
reasonably necessary to enable the Issuer to perform its obligations under this
Warrant.

                                        -4-

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       (d)    LOSS. THEFT. DESTRUCTION OF WARRANTS. Upon receipt of evidence
satisfactory to the Issuer of the ownership of and the loss, theft, destruction
or mutilation of any Warrant and, in the case of any such loss, theft or
destruction, upon receipt of indemnity or security satisfactory to the Issuer
or, in the case of any such mutilation, upon surrender and cancellation of such
Warrant, the Issuer will make and deliver, in lieu of such lost, stolen,
destroyed or mutilated Warrant, a new Warrant of like tenor and representing the
right to purchase the same number of shares of Common Stock.

       (e)    RIGHTS AND OBLIGATIONS UNDER THE REGISTRATION RIGHTS AGREEMENT.
The shares of Warrant Stock are entitled to the benefits and subject to the
terms of the Registration Rights Agreement dated as of even date herewith
between the Issuer and the Holders listed on the signature pages thereof (as
amended from time to time, the "Registration Rights Agreement"). The Issuer
shall keep or cause to be kept a copy of the Registration Rights Agreement, and
any amendments thereto, at its chief executive office and shall furnish, without
charge, copies thereof to the Holder upon request.

       4.     ADJUSTMENT OF WARRANT PRICE AND WARRANT SHARE NUMBER. The number
and kind of Securities purchasable upon the exercise of this Warrant and the
Warrant Price shall be subject to adjustment from time to time upon the
happening of certain events as follows:

       (a)    RECAPITALIZATION, REORGANIZATION, RECLASSIFICATION, CONSOLIDATION,
MERGER OR SALE. (i) In case the Issuer after the Original Issue Date shall do
any of the following (each, a "Triggering Event"): (a) consolidate with or merge
into any other Person and the Issuer shall not be the continuing or surviving
corporation of such consolidation or merger, or (b) permit any other Person to
consolidate with or merge into the Issuer and the Issuer shall be the continuing
or surviving Person but, in connection with such consolidation or merger, any
Capital Stock of the Issuer shall be changed into or exchanged for Securities of
any other Person or cash or any other property, or (c) transfer all or
substantially all of its properties or assets to any other Person, or (d) effect
a capital reorganization or reclassification of its Capital Stock, then, and in
the case of each such Triggering Event, proper provision shall be made so that,
upon the basis and the terms and in the manner provided in this Warrant, the
Holder of this Warrant shall be entitled (x) upon the exercise hereof at any
time after the consummation of such Triggering Event, to the extent this Warrant
is not exercised prior to such Triggering Event, to receive at the Warrant Price
in effect at the time immediately prior to the consummation of such Triggering
Event in lieu of the Common Stock issuable upon such exercise of this Warrant
prior to such Triggering Event, the Securities, cash and property to which such
Holder would have been entitled upon the consummation of such Triggering Event
if such Holder had exercised the rights represented by this Warrant immediately
prior thereto, subject to adjustments (subsequent to such corporate action) as
nearly equivalent as possible to the adjustments provided for in Section 4
hereof or (y) to sell this Warrant (or, at such Holder's election, a portion
hereof) concurrently with the Triggering Event to the Person continuing after or
surviving such Triggering Event, or to the Issuer (if Issuer is the continuing
or surviving Person) at a sales price equal to the amount of cash, property
and/or Securities to which a holder of the number of shares of Common Stock
which would otherwise have been delivered upon the exercise of this Warrant
would have been entitled upon the effective date or closing of any such
Triggering Event (the "Event Consideration"), less the amount or portion of such
Event Consideration having a fair value equal to the aggregate Warrant Price
applicable to this Warrant or the portion hereof so sold.

                                        -5-

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       (ii)   Notwithstanding anything contained in this Warrant to the
contrary, the Issuer will not effect any Triggering Event unless, prior to the
consummation thereof, each Person (other than the Issuer) which may be required
to deliver any Securities, cash or property upon the exercise of this Warrant as
provided herein shall assume, by written instrument delivered to, and reasonably
satisfactory to, the Holder of this Warrant, (A) the obligations of the Issuer
under this Warrant (and if the Issuer shall survive the consummation of such
Triggering Event, such assumption shall be in addition to, and shall not release
the Issuer from, any continuing obligations of the Issuer under this Warrant)
and (B) the obligation to deliver to such Holder such shares of Securities, cash
or property as, in accordance with the foregoing provisions of this subsection
(a), such Holder shall be entitled to receive, and such Person shall have
similarly delivered to such Holder an opinion of counsel for such Person, which
counsel shall be reasonably satisfactory to such Holder, stating that this
Warrant shall thereafter continue in full force and effect and the terms hereof
(including, without limitation, all of the provisions of this subsection (a))
shall be applicable to the Securities, cash or property which such Person may be
required to deliver upon any exercise of this Warrant or the exercise of any
rights pursuant hereto.

       (iii)  if with respect to any Triggering Event, the Holder of this
Warrant has exercised its right as provided in clause (y) of subparagraph (i) of
this subsection (a) to sell this Warrant or a portion thereof, the Issuer agrees
that as a condition to the consummation of any such Triggering Event the Issuer
shall secure such right of Holder to sell this Warrant to the Person continuing
after or surviving such Triggering Event and the Issuer shall not effect any
such Triggering Event unless upon or prior to the consummation thereof the
amounts of cash, property and/or Securities required under such clause (y) are
delivered to the Holder of this Warrant. The obligation of the Issuer to secure
such right of the Holder to sell this Warrant shall be subject to such Holder's
cooperation with the Issuer, including, without limitation, the giving of
customary representations and warranties to the purchaser in connection with any
such sale. Prior notice of any Triggering Event shall be given to the Holder of
this Warrant in accordance with Section 11 hereof

       (b)    SUBDIVISION OR COMBINATION OF SHARES. If the Issuer, at any time
while this Warrant is outstanding, shall subdivide or combine any shares of
Common Stock, (i) in case of subdivision of shares, the Warrant Price shall be
proportionately reduced (as at the effective date of such subdivision or, if the
Issuer shall take a record of Holders of its Common Stock for the purpose of so
subdividing, as at the applicable record date, whichever is earlier) to reflect
the increase in the total number of shares of Common Stock outstanding as a
result of such subdivision, or (ii) in the case of a combination of shares, the
Warrant Price shall be proportionately increased (as at the effective date of
such combination or, if the Issuer shall take a record of Holders of its Common
Stock for the purpose of so combining, as at the applicable record date,
whichever is earlier) to reflect the reduction in the total number of shares of
Common Stock outstanding as a result of such combination.

       (c)    CERTAIN DIVIDENDS AND DISTRIBUTIONS. If the Issuer, at any time
while this Warrant is outstanding, shall:

              (i)    STOCK DIVIDENDS. Pay a dividend in, or make any other
       distribution to its stockholders (without consideration therefor) of,
       shares of Common Stock, the Warrant Price shall be adjusted, as at the
       date the Issuer shall take a record of the Holders of the Issuer's

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       Capital Stock for the purpose of receiving such dividend or other
       distribution (or if no such record is taken, as at the date of such
       payment or other distribution), to that price determined by multiplying
       the Warrant Price in effect immediately prior to such record date (or if
       no such record is taken, then immediately prior to such payment or other
       distribution), by a fraction (1) the numerator of which shall be the
       total number of shares of Common Stock outstanding immediately prior to
       such dividend or distribution, and (2) the denominator of which shall be
       the total number of shares of Common Stock outstanding immediately after
       such dividend or distribution (plus in the event that the Issuer paid
       cash for fractional shares, the number of additional shares which would
       have been outstanding had the Issuer issued fractional shares in
       connection with said dividends); or

              (ii)   OTHER DIVIDENDS. Pay a dividend on, or make any
       distribution of its assets upon or with respect to (including, but not
       limited to, a distribution of its property as a dividend in liquidation
       or partial liquidation or by way of return of capital), the Common Stock
       (other than as described in clause (i) of this subsection (c)), or in the
       event that the Company shall offer options or rights to subscribe for
       shares of Common Stock, or issue any Common Stock Equivalents, to all of
       its holders of Common Stock, then on the record date for such payment,
       distribution or offer or, in the absence of a record date, on the date of
       such payment, distribution or offer, the Holder shall receive what the
       Holder would have received had it exercised this Warrant in full
       immediately prior to the record date of such payment, distribution or
       offer or, in the absence of a record date, immediately prior to the date
       of such payment, distribution or offer.

       (d)    ISSUANCE OF ADDITIONAL SHARES OF COMMON STOCK. If the Issuer, at
any time while this Warrant is outstanding, shall issue any Additional Shares of
Common Stock (otherwise than as provided in the foregoing subsections (a)
through (c) of this Section 4), at a price per share less than the Warrant Price
then in effect or less than the Per Share Market Value then in effect or without
consideration, then the Warrant Price upon each such issuance shall be adjusted
to that price (rounded to the nearest cent) determined by multiplying the
Warrant Price then in effect by a fraction:

              (i)    the numerator of which shall be equal to the sum of (A) the
       number of shares of Common Stock outstanding immediately prior to the
       issuance of such Additional Shares of Common Stock PLUS (B) the number of
       shares of Common Stock (rounded to the nearest whole share) which the
       aggregate consideration for the total number of such Additional Shares of
       Common Stock so issued would purchase at a price per share equal to the
       greater of the Per Share Market Value then in effect and the Warrant
       Price then in effect, and

              (ii)   the denominator of which shall be equal to the number of
       shares of Common Stock outstanding immediately after the issuance of such
       Additional Shares of Common Stock.

The provisions of this subsection (d) shall not apply under any of the
circumstances for which an adjustment is provided in subsections (a), (b) or (c)
of this Section 4. No adjustment of the Warrant Price shall be made under this
subsection (d) upon the issuance of any Additional Shares of Common Stock which
are issued pursuant to any Common Stock Equivalent if upon the issuance of such
Common Stock Equivalent (x) any adjustment shall have been made pursuant to
subsection (e) of this

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Section 4 or (Y) no adjustment was required pursuant to subsection (e) of this
Section 4. No adjustment of the Warrant Price shall be made under this
subsection (d) in an amount less than $.01 per share, but any such lesser
adjustment shall be carried forward and shall be made at the time and together
with the next subsequent adjustment, if any, which together with any adjustments
so carried forward shall amount to $.0l per share or more, provided that upon
any adjustment of the Warrant Price as a result of any dividend or distribution
payable in Common Stock or Convertible Securities or the reclassification,
subdivision or combination of Common Stock into a greater or smaller number of
shares, the foregoing figure of$.01 per share (or such figure as last adjusted)
shall be adjusted (to the nearest one-half cent) in proportion to the adjustment
in the Warrant Price.

       (e)    ISSUANCE OF COMMON STOCK EQUIVALENTS, If the Issuer, at any time
while this Warrant is outstanding, shall issue any Common Stock Equivalent and
the price per share for which Additional Shares of Common Stock may be issuable
thereafter pursuant to such Common Stock Equivalent shall be less than the
Warrant Price then in effect or less than the Per Share Market Value then in
effect, or if, after any such issuance of Common Stock Equivalents, the price
per share for which Additional Shares of Common Stock may be issuable thereafter
is amended or adjusted, and such price as so amended shall be less than the
Warrant Price or less than the Per Share Market Value in effect at the time of
such amendment, then the Warrant Price upon each such issuance or amendment
shall be adjusted as provided in the first sentence of subsection (d) of this
Section 4 on the basis that (1) the maximum number of Additional Shares of
Common Stock issuable pursuant to all such Common Stock Equivalents shall be
deemed to have been issued (whether or not such Common Stock Equivalents are
actually then exercisable, convertible or exchangeable in whole or in part) as
of the earlier of (A) the date on which the Issuer shall enter into a firm
contract for the issuance of such Common Stock Equivalent, or (B) the date of
actual issuance of such Common Stock Equivalent, and (2) the aggregate
consideration for such maximum number of Additional Shares of Common Stock shall
be deemed to be the minimum consideration received or receivable by the Issuer
for the issuance of such Additional Shares of Common Stock pursuant to such
Common Stock Equivalent. No adjustment of the Warrant Price shall be made under
this subsection (e) upon the issuance of any Convertible Security which is
issued pursuant to the exercise of any warrants or other subscription or
purchase rights therefor, if any adjustment shall previously have been made in
the Warrant Price then in effect upon the issuance of such warrants or other
rights pursuant to this subsection (e). if no adjustment is required under this
subsectin (e) upon issuance of any Common Stock Equivalent or once an adjustment
is made under this subsection (e) based upon the Per Share Market Value in
effect on the date of such adjustment, no further adjustment shall be made under
this subsection (e) based solely upon a change in the Per Share Market Value
after such date.

       (f)    PURCHASE OF COMMON STOCK BY THE ISSUER. if the Issuer at any time
while this Warrant is outstanding shall, directly or indirectly through a
Subsidiary or otherwise, purchase, redeem or otherwise acquire any shares of
Common Stock at a price per share greater than the Per Share Market Value then
in effect, then the Warrant Price upon each such purchase, redemption or
acquisition shall be adjusted to that price determined by multiplying such
Warrant Price by a fraction (i) the numerator of which shall be the number of
shares of Common Stock outstanding immediately prior to such purchase,
redemption or acquisition minus the number of shares of Common Stock which the
aggregate consideration for the total number of such shares of Common Stock so
purchased, redeemed or acquired would purchase at the Per Share Market Value;
and (ii) the denominator of which shall be the number of shares of Common Stock
outstanding immediately after

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such purchase, redemption or acquisition. For the purposes of this subsection
(f), the date as of which the Per Share Market Value shall be computed shall be
the earlier of(x) the date on which the Issuer shall enter into a firm contract
for the purchase, redemption or acquisition of such Common Stock, or (y) the
date of actual purchase, redemption or acquisition of such Common Stock. For the
purposes of this subsection (f), a purchase, redemption or acquisition of a
Common Stock Equivalent shall be deemed to be a purchase of the underlying
Common Stock, and the computation herein required shall be made on the basis of
the full exercise, conversion or exchange of such Common Stock Equivalent on the
date as of which such computation is required hereby to be made, whether or not
such Common Stock Equivalent is actually exercisable, convertible or
exchangeable on such date.

       (g)    OTHER PROVISIONS APPLICABLE TO ADJUSTMENTS UNDER THIS SECTION 4.
The following provisions shall be applicable to the making of adjustments in the
Warrant Price hereinbefore provided in Section 4:

              (i)    COMPUTATION OF CONSIDERATION. The consideration received by
       the Issuer shall be deemed to be the following: to the extent that any
       Additional Shares of Common Stock or any Common Stock Equivalents shall
       be issued for a cash consideration, the consideration received by the
       Issuer therefor, or if such Additional Shares of Common Stock or Common
       Stock Equivalents are offered by the Issuer for subscription, the
       subscription price, or, if such Additional Shares of Common Stock or
       Common Stock Equivalents are sold to underwriters or dealers for public
       offering without a subscription offering, the public offering price, in
       any such case excluding any amounts paid or receivable for accrued
       interest or accrued dividends and without deduction of any compensation,
       discounts, commissions, or expenses paid or incurred by the Issuer for or
       in connection with the underwriting thereof or otherwise in connection
       with the issue thereof, to the extent that such issuance shall be for a
       consideration other than cash, then, except as herein otherwise expressly
       provided, the fair market value of such consideration at the, time of
       such issuance as determined in good faith by the Board. The consideration
       for any Additional Shares of Common Stock issuable pursuant to any Common
       Stock Equivalents shall be the consideration received by the Issuer for
       issuing such Common Stock Equivalents, plus the additional consideration
       payable to the Issuer upon the exercise, conversion or exchange of such
       Common Stock Equivalents. In case of the issuance at any time of any
       Additional Shares of Common Stock or Common Stock Equivalents in payment
       or satisfaction of any dividend upon any class of Capital Stock of the
       Issuer other than Common Stock, the Issuer shall be deemed to have
       received for such Additional Shares of Common Stock or Common Stock
       Equivalents a consideration equal to the amount of such dividend so paid
       or satisfied. In any case in which the consideration to be received or
       paid shall be other than cash, the Board shall notify the Holder of this
       Warrant of its determnation of the fair market value of such
       consideration prior to payment or accepting receipt thereof If, within
       thirty days after receipt of said notice, the Majority Holders shall
       notify the Board in writing of their objection to such determination, a
       determination of the fair market value of such consideration shall be
       made by an Independent Appraiser selected by the Majority Holders with
       the approval of the Board (which approval shall not be unreasonably
       withheld), whose fees and expenses shall be paid by the Issuer.

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              (ii)   READJUSTMENT OF WARRANT PRICE. Upon the expiration or
       termination of the right to convert, exchange or exercise any Common
       Stock Equivalent the issuance of which effected an adjustment in the
       Warrant Price, if such Common Stock Equivalent shall not have been
       converted, exercised or exchanged in its entirety, the number of shares
       of Common Stock deemed to be issued and outstanding by reason of the fact
       that they were issuable upon conversion, exchange or exercise of any such
       Common Stock Equivalent shall no longer be computed as set forth above,
       and the Warrant Price shall forthwith be readjusted and thereafter be the
       price which it would have been (but reflecting any other adjustments in
       the Warrant Price made pursuant to the provisions of this Section 4 after
       the issuance of such Common Stock Equivalent) had the adjustment of the
       Warrant Price been made in accordance with the issuance or sale of the
       number of Additional Shares of Common Stock actually issued upon
       conversion, exchange or issuance of such Common Stock Equivalent and
       thereupon only the number of Additional Shares of Common Stock actually
       so issued shall be deemed to have been issued and only the consideration
       actually received by the Issuer (computed as in clause (i) of this
       subsection (g)) shall be deemed to have been received by the Issuer.

              (iii)  OUTSTANDING COMMON STOCK. The number of shares of Common
       Stock at any time outstanding shall (A) not include any shares thereof
       then directly or indirectly owned or held by or for the account of the
       Issuer or any of its Subsidiaries, and (B) be deemed to include all
       shares of Common Stock then issuable upon conversion, exercise or
       exchange of any then outstanding Common Stock Equivalents or any other
       evidences of Indebtedness, shares of Capital Stock (including, without
       limitation, the Preferred Stock) or other Securities which are or may be
       at any time convertible into or exchangeable for shares of Common Stock
       or Other Common Stock.

       (h)    OTHER ACTION AFFECTING COMMON STOCK. In case after the Original
Issue Date the Issuer shall take any action affecting its Common Stock, other
than an action described in any of the foregoing subsections (a) through (g) of
this Section 4, inclusive, and the failure to make any adjustment would not
fairly protect the purchase rights represented by this Warrant in accordance
with the essential intent and principle of this Section 4, then the Warrant
Price shall be adjusted in such manner and at such time as the Board may in good
faith determine to be equitable in the circumstances.

       (i)    ADJUSTMENT OF WARRANT SHARE NUMBER. Upon each adjustment in the
Warrant Price pursuant to any of the foregoing provisions of this Section 4, the
Warrant Share Number shall be adjusted, to the nearest one hundredth of a whole
share, to the product obtained by multiplying the Warrant Share Number
immediately prior to such adjustment in the Warrant Price by a fraction, the
numerator of which shall be the Warrant Price immediately before giving effect
to such adjustment and the denominator of which shall be the Warrant Price
immediately after giving effect to such adjustment. If the Issuer shall be in
default under any provision contained in Section 3 of this Warrant so that
shares issued at the Warrant Price adjusted in accordance with this Section 4
would not be validly issued, the adjustment of the Warrant Share Number provided
for in the foregoing sentence shall nonetheless be made and the Holder of this
Warrant shall be entitled to purchase such greater number of shares at the
lowest price at which such shares may then be validly issued under applicable

                                        -10-

<PAGE>

law. Such exercise shall not constitute a waiver of any claim arising against
the Issuer by reason of its default under Section 3 of this Warrant.

       (j)    FORM OF WARRANT AFTER ADJUSTMENTS. The form of this Warrant need
not be changed because of any adjustments in the Warrant Price or the number and
kind of Securities purchasable upon the exercise of this Warrant.

       5.     NOTICE OF ADJUSTMENTS. Whenever the Warrant Price or Warrant Share
Number shall be adjusted pursuant to Section 4 hereof (for purposes of this
Section 5, each an "adjustment"), the Issuer shall cause its Chief Financial
Officer to prepare and execute a certificate setting forth, in reasonable
detail, the event requiring the adjustment, the amount of the adjustment, the
method by which such adjustment was calculated (including a description of the
basis on which the Board made any determination hereunder), and the Warrant
Price and Warrant Share Number after giving effect to such adjustment, and shall
cause copies of such certificate to be delivered to the Holder of this Warrant
promptly after each adjustment. Any dispute between the Issuer and the Holder of
this Warrant with respect to the matters set forth in such certificate may at
the option of the Holder of this Warrant be submitted to one of the national
accounting firms currently known as the "big five" selected by the Holder,
PROVIDED that the Issuer shall have ten days after receipt of notice from such
Holder of its selection of such firm to object thereto, in which case such
Holder shall select another such firm and the Issuer shall have no such right of
objection. The firm selected by the Holder of this Warrant as provided in the
preceding sentence shall be instructed to deliver a written opinion as to such
matters to the Issuer and such Holder within thirty days after submission to it
of such dispute. Such opinion shall be final and binding on the parties hereto.
The fees and expenses of such accounting firm shall be paid by the Issuer.

       6.     FRACTIONAL SHARES. No fractional shares of Warrant Stock will be
issued in connection with and exercise hereof, but in lieu of such fractional
shares, the Issuer shall make a cash payment therefor equal in amount to the
product of the applicable fraction multiplied by the Per Share Market Value then
in effect.

       7.     DEFINITIONS. For the purposes of this Warrant, the following terms
have the following meanings:

              "Additional Shares of Common Stock" means all shares of Common
       Stock issued by the Issuer after the Original Issue Date, and all shares
       of Other Common, if any, issued by the Issuer after the Original Issue
       Date, except any shares of Common Stock presently outstanding, any shares
       of Common Stock issued upon the exercise of any existing or future stock
       options or grants issued to any directors, officers, employees or
       consultants of the Issuer under any employee incentive stock option
       and/or any stock option plan approved by the Board, the Warrant Stock and
       the Preferred Shares.

              "Board" shall mean the Board of Directors of the Issuer.

              "Capital Stock" means and includes (i) any and all shares,
       interests, participations or other equivalents of or interests in
       (however designated) corporate stock, including, without limitation,
       shares of preferred or preference stock, (ii) all partnership interests
       (whether

                                        -11-

<PAGE>

general or limited) in any Person which is a partnership, (iii) all membership
interests or limited liability company interests in any limited liability
company, and (iv) all equity or ownership interests in any Person of any other
type.

       "Certificate of Incorporation" means the Certificate of Incorporation of
the Issuer as in effect on the Original Issue Date, and as hereafter from time
to time amended, modified, supplemented or restated in accordance with the terms
hereof and thereof and pursuant to applicable law.

       "Common Stock" means the Common Stock, $.00l par value, of the Issuer and
any other Capital Stock into which such stock may hereafter be changed.

       "Common Stock Equivalent" means any Convertible Security or warrant,
option or other right to subscribe for or purchase any Additional Shares of
Common Stock or any Convertible Security.

       "Convertible Securities" means evidences of Indebtedness, shares of
Capital Stock or other Securities which are or may be at any time convertible
into or exchangeable for Additional Shares of Common Stock. The term
"Convertible Security" means one of the Convertible Securities.

       "Governmental Authority" means any governmental, regulatory or
self-regulatory entity, department, body, official, authority, commission,
board, agency or instrumentality, whether federal, state or local, and whether
domestic or foreign.

       "Holders" mean the Persons who shall from time to time own any Warrant.
The term "Holder" means one of the Holders.

       "Independent Appraiser" means a nationally recognized or major regional
investment banking firm or firm of independent certified public accountants of
recognized standing (which may be the firm that regularly examines the financial
statements of the Issuer) that is regularly engaged in the business of
appraising the Capital Stock or assets of corporations or other entities as
going concerns, and which is not affiliated with either the Issuer or the Holder
of any Warrant.

       "Issuer" means eSynch Corporation, a Delaware corporation, and its
successors.

       "Majority Holders" means at any time the Holders of Warrants exercisable
for a majority of the shares of Warrant Stock issuable under the Warrants at the
time outstanding.

       "Original Issue Date" means August 13, 1999.

       "Other Common" means any other Capital Stock of the Issuer of any class
which shall be authorized at any time after the date of this Warrant (other than
Common Stock) and which shall have the right to participate in the distribution
of earnings and assets of the Issuer without limitation as to amount.

                                        -12-

<PAGE>

       "OTC Bulletin Board" means the over-the-counter electronic bulletin
board.

       "Person" means an individual, corporation, limited liability company,
partnership, joint stock company, trust, unincorporated organization, joint
venture, Governmental Authority or other entity of whatever nature.

       "Per Share Market Value" means on any particular date (a) the closing bid
price per share of the Common Stock on such date on the OTC Bulletin Board or
other registered national stock exchange on which the Common Stock is then
listed or if there is no such price on such date, then the closing bid price on
such exchange or quotation system on the date nearest preceding such date, or
(b) if the Common Stock is not listed then on the OTC Bulletin Board or any
registered national stock exchange, the closing bid price for a share of Common
Stock in the over-the-counter market, as reported by the OTC Bulletin Board or
in the National Quotation Bureau Incorporated or similar organization or agency
succeeding to its functions of reporting prices) at the close of business on
such date, or (c) if the Common Stock is not then reported by the OTC Bulletin
Board or the National Quotation Bureau Incorporated (or similar organization or
agency succeeding to its functions of reporting prices), then the average of the
"Pink Sheet" quotes for the relevant conversion period, as determined in good
faith by the holder, or (d) if the Common Stock is not then publicly traded the
fair market value of a share of Common Stock as determined by an Independent
Appraiser selected in good faith by the Majority Holders; PROVIDED, HOWEVER,
that the Issuer, after receipt of the determination by such Independent
Appraiser, shall have the right to select an additional Independent Appraiser,
in which case, the fair market value shall be equal to the average of the
determinations by each such Independent Appraiser; and PROVIDED, FURTHER that
all determinations of the Per Share Market Value shall be appropriately adjusted
for any stock dividends, stock splits or other similar transactions during such
period. The determination of fair market value by an Independent Appraiser shall
be based upon the fair market value of the Issuer determined on a going concern
basis as between a willing buyer and a willing seller and taking into account
all relevant factors determinative of value, and shall be final and binding on
all parties. In determining the fair market value of any shares of Common Stock,
no consideration shall be given to any restrictions on transfer of the Common
Stock imposed by agreement or by federal or state securities laws, or to the
existence or absence of, or any limitations on, voting rights.

       "Preferred Shares" means Common Stock issuable upon the conversion of any
Preferred Stock.

       "Preferred Stock" means the Series J Preferred Stock issued and sold
pursuant to the Purchase Agreement.

       "Purchase Agreement" means the Series J Convertible Preferred Stock
Purchase Agreement dated as of July 22, 1999 among the Issuer and the investors
a party thereto.

       "Registration Rights Agreement" has the meaning specified in Section 3(e)
hereof.

                                        -13-

<PAGE>

       "Securities" means any debt or equity securities of the Issuer, whether
now or hereafter authorized, any instrument convertible into or exchangeable for
Securities or a Security, and any option, warrant or other right to purchase or
acquire any Security. "Security" means one of the Securities.

       "Securities Act" means the Securities Act of 1933, as amended, or any
similar federal statute then in effect.

       "Subsidiary" means any corporation at least 50% of whose outstanding
Voting Stock shall at the time be owned directly or indirectly by the Issuer or
by one or more of its Subsidiaries, or by the Issuer and one or more of its
Subsidiaries.

       "Trading Day" means (a) a day on which the Common Stock is traded on the
over the counter market as reported by the OTC Bulletin Board, or (b) if the
Common Stock is not listed on the OTC Bulletin Board, a day on which the Common
Stock is traded on any other registered national stock exchange, or (c) if the
Common Stock is not quoted on the OTC Bulletin Board, a day on which the Common
Stock is quoted in the over-the-counter market as reported by the National
Quotation Bureau Incorporated (or any similar organization or agency succeeding
its functions of reporting prices); PROVIDED, HOWEVER, that in the event that
the Common Stock is not listed or quoted as set forth in (a), (b) and (c)
hereof, then Trading Day shall mean any day except Saturday, Sunday and any day
which shall be a legal holiday or a day on which banking institutions in the
State of New York are authorized or required by law or other government action
to close.

       "Term" has the meaning specified in Section 1 hereof

       "Voting Stock", as applied to the Capital Stock of any corporation, means
Capital Stock of any class or classes (however designated) having ordinary
voting power for the election of a majority of the members of the Board of
Directors (or other governing body) of such corporation, other than Capital
Stock having such power only by reason of the happening of a contingency.

       "Warrants" means the Warrants issued and sold pursuant to the Purchase
Agreement, including, without limitation, this Warrant, and any other warrants
of like tenor issued in substitution or exchange for any thereof pursuant to the
provisions of Section 2(c), 2(d) or 2(e) hereof or of any of such other
Warrants.

       "Warrant Price" means initially 115% of the closing bid price of the
Common Stock on the trading day immediately preceding each Closing Date (as such
term is defined in the Purchase Agreement), as such price may be adjusted from
time to time as shall result from the adjustments specified in Section 4 hereof

       "Warrant Share Number" means at any time the aggregate number of shares
of Warrant Stock which may at such time be purchased upon exercise of this
Warrant, after giving effect to all prior adjustments and increases to such
number made or required to be made under the terms hereof.

                                        -14-

<PAGE>

       "Warrant Stock" means Common Stock issuable upon exercise of any Warrant
or Warrants or otherwise issuable pursuant to any Warrant or Warrants.

       8.     OTHER NOTICES. In case at any time:

                            (A)    the Issuer shall make any distributions to
                                   the holders of Common Stock; or

                            (B)    the Issuer shall authorize the granting to
                                   all holders of its Common Stock of rights to
                                   subscribe for or purchase any shares of
                                   Capital Stock of any class or of any Common
                                   Stock Equivalents or Convertible Securities
                                   or other rights; or

                            (C)    there shall be any reclassification of the
                                   Capital Stock of the Issuer; or

                            (D)    there shall be any capital reorganization by
                                   the Issuer; or

                            (E)    there shall be any (i) consolidation or
                                   merger involving the Issuer or (ii) sale,
                                   transfer or other disposition of all or
                                   substantially all of the Issuer's property,
                                   assets or business (except a merger or other
                                   reorganization in which the Issuer shall be
                                   the surviving corporation and its shares of
                                   Capital Stock shall continue to be
                                   outstanding and unchanged and except a
                                   consolidation, merger, sale, transfer or
                                   other disposition involving a wholly-owned
                                   Subsidiary); or

                            (F)    there shall be a voluntary or involuntary
                                   dissolution, liquidation or winding-up of the
                                   Issuer or any partial liquidation of the
                                   Issuer or distribution to holders of Common
                                   Stock;

then, in each of such cases, the Issuer shall give written notice to the Holder
of the date on which (i) the books of the Issuer shall close or a record shall
be taken for such dividend, distribution or subscription rights or (ii) such
reorganization, reclassification, consolidation, merger, disposition,
dissolution, liquidation or winding-up, as the case may be, shall take place.
Such notice also shall specify the date as of which the holders of Common Stock
of record shall participate in such dividend, distribution or subscription
rights, or shall be entitled to exchange their certificates for Common Stock for
securities or other property deliverable upon such reorganization,
reclassification, consolidation, merger, disposition, dissolution, liquidation
or winding-up, as the case may be. Such notice shall be given at least twenty
days prior to the action in question and not less than twenty days prior to the
record date or the date on which the Issuer's transfer books are closed in
respect thereto. The Issuer shall give to the Holder notice of all meetings and
actions by written consent of its stockholders, at the same time in the same
manner as notice of any meetings of stockholders is required to be given to
stockholders who do not waive such notice (or, if such requires no notice,

                                        -15-

<PAGE>

then two Trading Days written notice thereof describing the matters upon which
action is to be taken). The Holder shall have the right to send two
representatives selected by it to each meeting, who shall be permitted to
attend, but not vote at, such meeting and any adjournments thereof This Warrant
entitles the Holder to receive copies of all financial and other information
distributed or required to be distributed to the holders of the Common Stock.

       9.     AMENDMENT AND WAIVER. Any term, covenant, agreement or condition
in this Warrant may be amended, or compliance therewith may be waived (either
generally or in a particular instance and either retroactively or
prospectively), by a written instrument or written instruments executed by the
Issuer and the Majority Holders; PROVIDED, HOWEVER that no such amendment or
waiver shall reduce the Warrant Share Number, increase the Warrant Price,
shorten the period during which this Warrant may be exercised or modify any
provision of this Section 9 without the consent of the Holder of this Warrant.

       10.    GOVERNING LAW. THIS WARRANT SHALL BE GOVERNED BY AND CONSTRUED IN
ACCORDANCE WITH THE LAWS OF THE STATE OF NEW YORK, WITHOUT GIVING EFFECT TO
PRINCIPLES OF CONFLICTS OF LAW.

       11.    NOTICES. Any and all notices or other communications or deliveries
required or permitted to be provided hereunder shall be in writing and shall be
deemed given and effective on the earlier of (i) the date of transmission, if
such notice or communication is delivered via facsimile at the facsimile
telephone number specified for notice prior to 5:00 p.m., pacific standard time,
on a Business Day, (ii) the Business Day after the date of transmission, if such
notice or communication is delivered via facsimile at the facsimile telephone
number specified for notice later than 5:00 p.m., pacific standard time, on any
date and earlier than 11:59p.m., pacific standard time, on such date, (iii) the
Business Day following the date of mailing, if sent by nationally recognized
overnight courier service or (iv) actual receipt by the party to whom such
notice is required to be given. The addresses for such communications shall be
with respect to the Holder of this Warrant or of Warrant Stock issued pursuant
hereto, addressed to such Holder at its last known address or facsimile number
appearing on the books of the Issuer maintained for such purposes, or with
respect to the Issuer, addressed to:

              eSynch Corporation
              15502 Mosher Avenue
              Tustin, California 92780
              Telephone Number: (714) 258-1900
              Facsimile Number: (714) 258-7177
              Attention:  Thomas Hemingway, C.E.O.

or to such other address or addresses or facsimile number or numbers as any such
party may most recently have designated in writing to the other parties hereto
by such notice. Copies of notices to the Issuer shall be sent to Nicholas J.
Yocca, Stradling Yocca Carlson & Rauth, PC, 660 Newport Center Drive, Suite
1600, Newport Beach, CA 92660, Facsimile no.: (949) 823-5120. Copies of notices
to the Holder shall be sent to (a) Parker Chapin Flattau & Klimpl, LLP, 1211
Avenue of the Americas, New York, New York 10036, Attention: Christopher S.
Auguste, Esq., Facsimile no.:

                                        -16-

<PAGE>

(212) 704-6288 and (b) H. Glenn Bagwell, Jr., Esq., 3005 Anderson Drive, Suite
204, Raleigh, N.C. 27609, Facsimile no.: (919) 785-3116.

       12.    WARRANT AGENT. The Issuer may, by written notice to each Holder of
this Warrant, appoint an agent having an office in New York, New York for the
purpose of issuing shares of Warrant Stock on the exercise of this Warrant
pursuant to subsection (b) of Section 2 hereof, exchanging this Warrant pursuant
to subsection (d) of Section 2 hereof or replacing this Warrant pursuant to
subsection (d) of Section 3 hereof, or any of the foregoing, and thereafter any
such issuance, exchange or replacement, as the case may be, shall be made at
such office by such agent.

       13.    REMEDIES. The Issuer stipulates that the remedies at law of the
Holder of this Warrant in the event of any default or threatened default by the
Issuer in the performance of or compliance with any of the terms of this Warrant
are not and will not be adequate and that, to the fullest extent permitted by
law, such terms may be specifically enforced by a decree for the specific
performance of any agreement contained herein or by an injunction against a
violation of any of the terms hereof or otherwise.

       14.    SUCCESSORS AND ASSIGNS. This Warrant and the rights evidenced
hereby shall inure to the benefit of and be binding upon the successors and
assigns of the Issuer, the Holder hereof and (to the extent provided herein) the
Holders of Warrant Stock issued pursuant hereto, and shall be enforceable by any
such Holder or Holder of Warrant Stock

       15.    MODIFICATION AND SEVERABILITY. If, in any action before any court
or agency legally empowered to enforce any provision contained herein, any
provision hereof is found to be unenforceable, then such provision shall be
deemed modified to the extent necessary to make it enforceable by such court or
agency. If any such provision is not enforceable as set forth in the preceding
sentence, the unenforceability of such provision shall not affect the other
provisions of this Warrant, but this Warrant shall be construed as if such
unenforceable provision had never been contained herein.

       16.    HEADINGS. The headings of the Sections of this Warrant are for
convenience of reference only and shall not, for any purpose, be deemed a part
of this Warrant.

                                        -17-

<PAGE>

       IN WITNESS WHEREOF, the Issuer has executed this Warrant as of the day
and year first above written.

                                                 ESYNCH CORPORATION

                                                 By:/s/ THOMAS HEMINGWAY
                                                    ---------------------
                                                 Name:   Thomas Hemingway
                                                 Title:   Chairman of the Board
                                                 and Chief Executive Officer

                                        -18-

<PAGE>

                                    EXERCISE FORM

[NAME OF ISSUER]

The undersigned                        , pursuant to the provisions of the
within Warrant, hereby elects to purchase                 shares of Common Stock
of ___________________ covered by the within Warrant.

Dated:                      Signature

                            Address

                                     ASSIGNMENT

FOR VALUE RECEIVED, __________________ hereby sells, assigns and transfers unto
___________________ the within Warrant and all rights evidenced thereby and does
irrevocably constitute and appoint , attorney, to transfer the said Warrant on
the books of the within named corporation.

Dated:                      Signature

                            Address

                                 PARTIAL ASSIGNMENT

FOR VALUE RECEIVED, __________________ hereby sells, assigns and transfers unto
__________________ the right to purchase _________ shares of Warrant Stock
evidenced by the within Warrant together with all rights therein, and does
irrevocably constitute and appoint                      attorney, to transfer
that part of the said Warrant on the books of the within named corporation.

Dated:                      Signature

                            Address

                             FOR USE BY THE ISSUER ONLY:
This Warrant No. W-_____ cancelled (or transferred or exchanged) this _____ day
of____________, ______ shares of Common Stock issued therefor in the name
of____________, Warrant No. W-_____ issued for ____ shares of Common Stock in
the name of                         .

                                        -19-<PAGE>

                                                                    EXHIBIT 4.03

                              HYBRID NETWORKS, INC.

                             1999 STOCK OPTION PLAN

         AS ADOPTED AS OF MAY 5, 1999 AND AMENDED AS OF AUGUST 10, 1999
                               AND OCTOBER 7, 1999

         1.   PURPOSE. The purpose of this Plan is to provide incentives to
attract, retain and motivate eligible persons whose present and potential
contributions are important to the success of the Company by offering them an
opportunity to participate in the Company's future performance through awards of
Options. CAPITALIZED TERMS NOT DEFINED IN THE TEXT ARE DEFINED IN SECTION 20
HEREOF.

         2.   SHARES SUBJECT TO THE PLAN.

                  2.1 NUMBER OF SHARES AVAILABLE. Subject to Sections 2.2 and 15
hereof, the total number of Shares reserved and available for grant and issuance
pursuant to this Plan will be 4,000,000 Shares. Subject to Sections 2.2 and 15
hereof, Shares will again be available for grant and issuance in connection with
future Awards under this Plan to the extent such Shares: (a) cease to be subject
to issuance upon exercise of an Option, other than due to exercise of such
Option; or (b) are subject to an Award that otherwise terminates without Shares
being issued. At all times the Company will reserve and keep available a
sufficient number of Shares as will be required to satisfy the requirements of
all Awards granted under this Plan.

                  2.2 ADJUSTMENT OF SHARES. In the event that the number of
outstanding shares of the Company's Common Stock is changed by a stock dividend,
recapitalization, stock split, reverse stock split, subdivision, combination,
reclassification or similar change in the capital structure of the Company
without consideration, then (a) the number of Shares reserved for issuance under
this Plan and (b) the Exercise Prices of and number of Shares subject to
outstanding Options will be proportionately adjusted, subject to any required
action by the Board or the stockholders of the Company and compliance with
applicable securities laws; provided, however, that fractions of a Share will
not be issued but will either be paid in cash at Fair Market Value of such
fraction of a Share or will be rounded down to the nearest whole Share, as
determined by the Committee.

         3.   ELIGIBILITY. Awards may be granted only to employees (including
officers and directors who are also employees) or consultants of the Company or
of a Parent or Subsidiary of the Company who meet the suitability standards set
forth below in this Section 3. A person may be granted more than one Award under
this Plan. To be eligible to receive options under this Plan, a person must meet
the following suitability standards: Such person must either (a) be an officer
or director of the Company, (b) have a pre-existing personal or business
relationship with the Company or any of its officers, directors or controlling
persons or (c) by reason of such person's business or financial experience or
the business or financial experience of such person's professional advisor who
is unaffiliated with and who is not compensated by the Company or any affiliate
or selling agent of the Company, directly or indirectly, could be reasonably
assumed to protect such person's own interests in connection with the Options.
The foregoing suitability standards are intended to comply, and shall be
interpreted in a manner consistent with, the excemption from qualification under
the California securities laws provided by Section 25102(f) of the California
Corporations Code and the regulations thereunder.

<PAGE>

         4.   ADMINISTRATION.

                  4.1 COMMITTEE AUTHORITY. This Plan will be administered by the
Committee or by the Board acting as the Committee. Subject to the general
purposes, terms and conditions of this Plan, and to the direction of the Board,
the Committee will have full power to implement and carry out this Plan. Without
limitation, the Committee will have the authority to:

                  (a)      construe and interpret this Plan, any Stock Option
                           Agreement and any other agreement or document
                           executed pursuant to this Plan;

                  (b)      prescribe, amend and rescind rules and regulations
                           relating to this Plan or any Award;

                  (c)      select persons to receive Awards;

                  (d)      determine the form and terms of Awards;

                  (e)      determine the number of Shares or other consideration
                           subject to Awards;

                  (f)      determine whether Awards will be granted singly, in
                           combination with, in tandem with, in replacement of,
                           or as alternatives to, other Awards under this Plan
                           or awards under any other incentive or compensation
                           plan of the Company or any Parent or Subsidiary of
                           the Company;

                  (g)      grant waivers of Plan or Award conditions;

                  (h)      determine the vesting, exercisability and payment of
                           Awards;

                  (i)      correct any defect, supply any omission, or reconcile
                           any inconsistency in this Plan, any Award, any Stock
                           Option Agreement or any Exercise Agreement; and

                  (j)      make all other determinations necessary or advisable
                           for the administration of this Plan.

                  4.2 COMMITTEE DISCRETION. Any determination made by the
Committee with respect to any Award will be made in its sole discretion at the
time of grant of the Award or, unless in contravention of any express term of
this Plan or Award, and subject to Section 5.8 hereof, at any later time, and
such determination will be final and binding on the Company and on all persons
having an interest in any Award under this Plan. The Committee may delegate to
one or more officers of the Company the authority to grant an Award under this
Plan.

         5. OPTIONS. The Committee may grant Options to eligible persons and
will determine whether such Options will be Incentive Stock Options within the
meaning of the Code ("ISOs") or Nonqualified Stock Options ("NQSOs"), the number
of Shares subject to the Option, the Exercise Price of the Option, the period
during which the Option may be exercised and all other terms and conditions of
the Option, subject to the following:

                  5.1 FORM OF OPTION GRANT. Each Option granted under this Plan
will be evidenced by a Stock Option Agreement which will expressly identify the
Option as an ISO or an NQSO and will be in such form and contain such provisions
(which need not be the same for each Participant) as the Committee may from time
to time approve, and which will comply with and be subject to the terms and
conditions of this Plan.

                  5.2 DATE OF GRANT. The date of grant of an Option will be the
date on which the Committee makes the determination to grant such Option, unless
otherwise specified by the Committee.

                                      -2-

<PAGE>

The Stock Option Agreement and a copy of this Plan will be delivered to the
Participant within a reasonable time after the granting of the Option.

                  5.3 EXERCISE PERIOD. Options may be exercisable within the
times or upon the events determined by the Committee as set forth in the Stock
Option Agreement governing such Option; provided, however, that no Option will
be exercisable after the expiration of ten years from the date the Option is
granted and provided further that no ISO granted to a person who directly or by
attribution owns more than 10% of the total combined voting power of all classes
of stock of the Company or any Parent or Subsidiary of the Company ("TEN PERCENT
STOCKHOLDER") will be exercisable after the expiration of five years from the
date the ISO is granted. The Committee also may provide for Options to become
exercisable at one time or from time to time, periodically or otherwise, in such
number of Shares or percentage of Shares as the Committee determines.
Notwithstanding the foregoing, Options to Participants who are not officers,
directors or consultants of the Company, or of any Parent or Subsidiary of the
Company, must become exercisable at a rate of at least 20% per year over five
years from the date the Option is granted, subject to earlier termination of the
Option pursuant to Sections 5.6 and 15.

                  5.4 EXERCISE PRICE. The Exercise Price of an Option will be
determined by the Committee when the Option is granted, provided that: (i) the
Exercise Price of an ISO will not be less than 100% of the Fair Market Value of
the Shares on the date of grant; and (ii) the Exercise Price of any Option
granted to a Ten Percent Stockholder will not be less than 110% of the Fair
Market Value of the Shares on the date of grant. Payment for the Shares
purchased must be made in accordance with Section 6 hereof.

                  5.5 METHOD OF EXERCISE. Options may be exercised only by
delivery to the Company of a written stock option exercise agreement (the
"EXERCISE AGREEMENT") in a form approved by the Committee (which need not be the
same for each Participant), stating the number of Shares being purchased, the
restrictions imposed on the Shares purchased under such Exercise Agreement, if
any, and such representations and agreements regarding Participant's investment
intent and access to information and other matters, if any, as may be required
or desirable by the Company to comply with applicable securities laws, together
with payment in full of the Exercise Price, and any applicable taxes, for the
number of Shares being purchased.

                  5.6 TERMINATION. Subject to earlier termination pursuant to
Section 15 hereof and notwithstanding the exercise periods set forth in the
Stock Option Agreement, exercise of an Option will always be subject to the
following:

                  (a)      If the Participant is Terminated for any reason
                           except death, Disability or for Cause, then the
                           Participant may exercise such Participant's Options
                           only to the extent that such Options are exercisable
                           upon the Termination Date and such Options must be
                           exercised by the Participant, if at all, as to all or
                           some of the Vested Shares calculated as of the
                           Termination Date, within three months after the
                           Termination Date (or within such shorter time period,
                           not less than 30 days, or within such longer time
                           period, not exceeding five years, as may be
                           determined by the Committee, with any exercise beyond
                           three months after the Termination Date deemed to be
                           an ISO), but in any event no later than the
                           expiration date of the Options.

                  (b)      If the Participant is Terminated because of
                           Participant's death or Disability (or the Participant
                           dies within three months after a Termination other
                           than because of Participant's death or Disability),
                           then Participant's Options may be exercised only to
                           the extent that such Options would have been
                           exercisable by Participant on the Termination Date
                           and must be exercised by Participant (or
                           Participant's legal representative or authorized
                           assignee), no later than 12 months after the
                           Termination Date (or within such shorter time period,
                           not less than six months, or within such longer time
                           period, not exceeding five years, as may be
                           determined by the Committee, with any such exercise
                           beyond (i) three months

                                      -3-

<PAGE>

                           after the Termination Date when the Termination is
                           for any reason other than the Participant's death or
                           Disability or (ii) 12 months after the Termination
                           Date when the Termination is for the Participant's
                           death or Disability, deemed to be an NQSO), but in
                           any event no later than the expiration date of the
                           Options.

                  (c)      Notwithstanding the provisions in paragraph 5.6(a)
                           above, if a Participant is terminated for Cause,
                           neither the Participant, the Participant's estate nor
                           such other person who may then hold the Option shall
                           be entitled to exercise any Option with respect to
                           any Shares whatsoever, after termination of service,
                           whether or not after termination of service the
                           Participant may receive payment from the Company or
                           Subsidiary for vacation pay, for services rendered
                           prior to termination, for services rendered for the
                           day on which termination occurs, for salary in lieu
                           of notice, or for any other benefits. In making such
                           determination, the Board shall give the Participant
                           an opportunity to present to the Board evidence on
                           his behalf. For the purpose of this paragraph,
                           termination of service shall be deemed to occur on
                           the date when the Company dispatches notice or advice
                           to the Participant that his service is terminated.

                  5.7 LIMITATIONS ON EXERCISE. The Committee may specify a
reasonable minimum number of Shares that may be purchased on any exercise of an
Option, provided that such minimum number will not prevent Participant from
exercising the Option for the full number of Shares for which it is then
exercisable.

                  5.8 LIMITATIONS ON ISOs. The aggregate Fair Market Value
(determined as of the date of grant) of Shares with respect to which ISOs are
exercisable for the first time by a Participant during any calendar year (under
this Plan or under any other incentive stock option plan of the Company, Parent
or Subsidiary of the Company) will not exceed $100,000. If the Fair Market Value
of Shares on the date of grant with respect to which ISOs are exercisable for
the first time by a Participant during any calendar year exceeds $100,000, then
the Options for the first $100,000 worth of Shares to become exercisable in such
calendar year will be ISOs and the Options for the amount in excess of $100,000
that become exercisable in that calendar year will be NQSOs. In the event that
the Code or the regulations promulgated thereunder are amended after the
Effective Date of this Plan to provide for a different limit on the Fair Market
Value of Shares permitted to be subject to ISOs, such different limit will be
automatically incorporated herein and will apply to any Options granted after
the effective date of such amendment.

                  5.9 MODIFICATION, EXTENSION OR RENEWAL. The Committee may
modify, extend or renew outstanding Options and authorize the grant of new
Options in substitution therefor, provided that any such action may not, without
the written consent of a Participant, impair any of such Participant's rights
under any Option previously granted. Any outstanding ISO that is modified,
extended, renewed or otherwise altered will be treated in accordance with
Section 424(h) of the Code. The Committee may reduce the Exercise Price of
outstanding Options without the consent of Participants affected by a written
notice to them; provided, however, that the Exercise Price may not be reduced
below the minimum Exercise Price that would be permitted under Section 5.4
hereof for Options granted on the date the action is taken to reduce the
Exercise Price.

                  5.10 NO DISQUALIFICATION. Notwithstanding any other provision
in this Plan, no term of this Plan relating to an ISO will be interpreted,
amended or altered, nor will any discretion or authority granted under this Plan
be exercised, so as to disqualify this Plan under Section 422 of the Code or,
without the consent of the Participant affected, to disqualify any ISO under
Section 422 of the Code.

         6.   PAYMENT FOR SHARE PURCHASES.

                  6.1 PAYMENT. Payment for Shares purchased pursuant to this
Plan may be made in cash (by check) or, where expressly approved for the
Participant by the Committee and, where permitted by law, by any of the means
set forth below:

                                      -4-

<PAGE>

                  (a)      by cancellation of indebtedness of the Company to the
                           Participant;

                  (b)      by surrender of shares that: (i) either (A) have been
                           owned by Participant for more than six months and
                           have been paid for within the meaning of SEC Rule 144
                           (and, if such shares were purchased from the Company
                           by use of a promissory note, such note has been fully
                           paid with respect to such shares) or (B) were
                           obtained by Participant in the public market and (ii)
                           are clear of all liens, claims, encumbrances or
                           security interests;

                  (c)      by tender of a full recourse promissory note having
                           such terms as may be approved by the Committee and
                           bearing interest at a rate sufficient to avoid
                           imputation of income under Sections 483 and 1274 of
                           the Code; provided, however, that the portion of the
                           Exercise Price equal to the par value of the Shares
                           must be paid in cash or other legal consideration
                           permitted by Delaware General Corporation Law
                           (Participants who are not employees or directors of
                           the Company will not be entitled to purchase Shares
                           with a promissory note unless the note is adequately
                           secured by collateral other than the Shares);

                  (d)      by waiver of compensation due or accrued to the
                           Participant for services rendered;

                  (e)      with respect only to purchases upon exercise of an
                           Option, and provided that a public market for the
                           Company's stock exists:

                           (1)      through a "same day sale" commitment from
                                    the Participant and a broker-dealer that is
                                    a member of the National Association of
                                    Securities Dealers (an "NASD DEALER")
                                    whereby the Participant irrevocably elects
                                    to exercise the Option and to sell a portion
                                    of the Shares so purchased to pay for the
                                    Exercise Price, and whereby the NASD Dealer
                                    irrevocably commits upon receipt of such
                                    Shares to forward the Exercise Price
                                    directly to the Company; or

                           (2)      through a "margin" commitment from the
                                    Participant and an NASD Dealer whereby the
                                    Participant irrevocably elects to exercise
                                    the Option and to pledge the Shares so
                                    purchased to the NASD Dealer in a margin
                                    account as security for a loan from the NASD
                                    Dealer in the amount of the Exercise Price,
                                    and whereby the NASD Dealer irrevocably
                                    commits upon receipt of such Shares to
                                    forward the Exercise Price directly to the
                                    Company; or

                  (f)      by any combination of the foregoing.

                  6.2 LOAN GUARANTEES. The Committee may help the Participant
pay for Shares purchased under this Plan by authorizing a guarantee by the
Company of a third-party loan to the Participant.

         7.   WITHHOLDING TAXES.

                  7.1 WITHHOLDING GENERALLY. Whenever Shares are to be issued in
satisfaction of Awards granted under this Plan, the Company may require the
Participant to remit to the Company an amount sufficient to satisfy federal,
state and local withholding tax requirements prior to the delivery of any
certificate or certificates for such Shares. Whenever, under this Plan, payments
in satisfaction of Awards are to be made in cash, such payment will be net of an
amount sufficient to satisfy federal, state, and local withholding tax
requirements.

                                      -5-

<PAGE>

                  7.2 STOCK WITHHOLDING. When, under applicable tax laws, a
Participant incurs tax liability in connection with the exercise or vesting of
any Award that is subject to tax withholding and the Participant is obligated to
pay the Company the amount required to be withheld, the Committee may in its
sole discretion allow the Participant to satisfy the minimum withholding tax
obligation by electing to have the Company withhold from the Shares to be issued
that number of Shares having a Fair Market Value equal to the minimum amount
required to be withheld, determined on the date that the amount of tax to be
withheld is to be determined. All elections by a Participant to have Shares
withheld for this purpose will be made in accordance with the requirements
established by the Committee for such elections and be in writing in a form
acceptable to the Committee.

         8.   PRIVILEGES OF STOCK OWNERSHIP.

                  8.1 VOTING AND DIVIDENDS. No Participant will have any of the
rights of a stockholder with respect to any Shares until the Shares are issued
to the Participant. After Shares are issued to the Participant, the Participant
will be a stockholder and have all the rights of a stockholder with respect to
such Shares, including the right to vote and receive all dividends or other
distributions made or paid with respect to such Shares. The Company will comply
with Section 260.140.1 of Title 10 of the California Code of Regulations with
respect to the voting rights of Common Stock.

                  8.2 FINANCIAL STATEMENTS. The Company will provide financial
statements to each Participant prior to such Participant's purchase of Shares
under this Plan, and to each Participant annually during the period such
Participant has Options outstanding, or as otherwise required under Section
260.140.46 of Title 10 of the California Code of Regulations. Notwithstanding
the foregoing, the Company will not be required to provide such financial
statements to Participants when issuance is limited to Participants whose
services in connection with the Company assure them access to equivalent
information.

         9.   TRANSFERABILITY. Options granted under this Plan, and any interest
therein, will not be transferable or assignable by Participant, and may not be
made subject to execution, attachment or similar process, otherwise than by will
or by the laws of descent and distribution or as determined by the Committee and
set forth in the Stock Option Agreement with respect to Options that are not
ISOs. During the lifetime of the Participant an Option will be exercisable only
by the Participant or Participant's legal representative, and any elections with
respect to an Option may be made only by the Participant or Participant's legal
representative unless otherwise determined by the Committee and set forth in the
Stock Option Agreement with respect to Options that are not ISOs.

         10.  CERTIFICATES. All certificates for Shares or other securities
delivered under this Plan will be subject to such stock transfer orders, legends
and other restrictions as the Committee may deem necessary or advisable,
including restrictions under any applicable federal, state or foreign securities
law, or any rules, regulations and other requirements of the SEC or any stock
exchange or automated quotation system upon which the Shares may be listed or
quoted.

         11.  ESCROW; PLEDGE OF SHARES. To enforce any restrictions on a
Participant's Shares, the Committee may require the Participant to deposit all
certificates representing Shares, together with stock powers or other
instruments of transfer approved by the Committee, appropriately endorsed in
blank, with the Company or an agent designated by the Company to hold in escrow
until such restrictions have lapsed or terminated, and the Committee may cause a
legend or legends referencing such restrictions to be placed on the
certificates. Any Participant who is permitted to execute a promissory note as
partial or full consideration for the purchase of Shares under this Plan will be
required to pledge and deposit with the Company all or part of the Shares so
purchased as collateral to secure the payment of Participant's obligation to the
Company under the promissory note; provided, however, that the Committee may
require or accept other or additional forms of collateral to secure the payment
of such obligation and, in any event, the Company will have full recourse
against the Participant under the promissory note notwithstanding any pledge of
the Participant's Shares or other collateral. In connection with any pledge of
the Shares, Participant will be required to execute and deliver a written pledge
agreement in such form as the

                                      -6-

<PAGE>

Committee will from time to time approve. The Shares purchased with the
promissory note may be released from the pledge on a pro rata basis as the
promissory note is paid.

         12.  EXCHANGE AND BUYOUT OF AWARDS. The Committee may, at any time or
from time to time, authorize the Company, with the consent of the respective
Participants, to issue new Awards in exchange for the surrender and cancellation
of any or all outstanding Awards. The Committee may at any time buy from a
Participant an Award previously granted with payment in cash, shares of Common
Stock of the Company or other consideration, based on such terms and conditions
as the Committee and the Participant may agree.

         13.  SECURITIES LAW AND OTHER REGULATORY COMPLIANCE. An Award will not
be effective unless such Award is in compliance with all applicable federal and
state securities laws, rules and regulations of any governmental body, and the
requirements of any stock exchange or automated quotation system upon which the
Shares may then be listed or quoted, as they are in effect on the date of grant
of the Award and also on the date of exercise or other issuance. Notwithstanding
any other provision in this Plan, the Company will have no obligation to issue
or deliver certificates for Shares under this Plan prior to (a) obtaining any
approvals from governmental agencies that the Company determines are necessary
or advisable, and/or (b) compliance with any exemption, completion of any
registration or other qualification of such Shares under any state or federal
law or ruling of any governmental body that the Company determines to be
necessary or advisable. The Company will be under no obligation to register the
Shares with the SEC or to effect compliance with the exemption, registration,
qualification or listing requirements of any state securities laws, stock
exchange or automated quotation system, and the Company will have no liability
for any inability or failure to do so.

         14.  NO OBLIGATION TO EMPLOY. Nothing in this Plan or any Award granted
under this Plan will confer or be deemed to confer on any Participant any right
to continue in the employ of, or to continue any other relationship with, the
Company or any Parent or Subsidiary of the Company or limit in any way the right
of the Company or any Parent or Subsidiary of the Company to terminate
Participant's employment or other relationship at any time, with or without
Cause.

         15.  CORPORATE TRANSACTIONS.

                  15.1 ASSUMPTION OR REPLACEMENT OF AWARDS BY SUCCESSOR OR
ACQUIRING CORPORATION. In the event of (a) a dissolution or liquidation of the
Company, (b) a merger or consolidation in which the Company is not the surviving
corporation (other than a merger or consolidation with a wholly-owned
subsidiary, a reincorporation of the Company in a different jurisdiction, or
other transaction in which there is no substantial change in the stockholders of
the Company or their relative stock holdings and the Awards granted under this
Plan are assumed, converted or replaced by the successor or acquiring
corporation, which assumption, conversion or replacement will be binding on all
Participants), (c) a merger in which the Company is the surviving corporation
but after which the stockholders of the Company immediately prior to such merger
(other than any stockholder which merges with the Company in such merger, or
which owns or controls another corporation which merges, with the Company in
such merger) cease to own their shares or other equity interests in the Company,
(d) the sale of all or substantially all of the assets of the Company or (e) the
acquisition, sale or transfer of more than 50% of the outstanding shares of the
Company by tender offer or similar transaction, any or all outstanding Awards
may be assumed, converted or replaced by the successor or acquiring corporation
(if any), which assumption, conversion or replacement will be binding on all
Participants. In the alternative, the successor or acquiring corporation may
substitute equivalent Awards or provide substantially similar consideration to
Participants as was provided to stockholders (after taking into account the
existing provisions of the Awards). The successor or acquiring corporation may
also issue, in place of outstanding Shares of the Company held by the
Participant, substantially similar shares or other property subject to
repurchase restrictions and other provisions no less favorable to the
Participant than those which applied to such outstanding Shares immediately
prior to such transaction described in this Section 15.1. In the event such
successor or acquiring corporation (if any) refuses to assume or substitute
Awards, as provided above, pursuant to a

                                      -7-

<PAGE>

transaction described in this Section 15.1, then notwithstanding any other
provision in this Plan to the contrary, such Awards will expire on such
transaction at such time and on such conditions as the Board will determine;
provided, however, that the Committee may, in its sole discretion, provide that
the vesting of any or all Awards granted pursuant to this Plan will accelerate.
If the Committee exercises such discretion with respect to Options, such Options
will become exercisable in full prior to the consummation of such event at such
time and on such conditions as the Committee determines, and if such Options are
not exercised prior to the consummation of the corporate transaction, they shall
terminate at such time as determined by the Committee.

                  15.2 OTHER TREATMENT OF AWARDS. Subject to any greater rights
granted to Participants under the foregoing provisions of this Section 15, in
the event of the occurrence of any transaction described in Section 15.1 hereof,
any outstanding Awards will be treated as provided in the applicable agreement
or plan of merger, consolidation, dissolution, liquidation or sale of assets.

                  15.3 ASSUMPTION OF AWARDS BY THE COMPANY. The Company, from
time to time, also may substitute or assume outstanding awards granted by
another company, whether in connection with an acquisition of such other company
or otherwise, by either (a) granting an Award under this Plan in substitution of
such other company's award or (b) assuming such award as if it had been granted
under this Plan if the terms of such assumed award could be applied to an Award
granted under this Plan. Such substitution or assumption will be permissible if
the holder of the substituted or assumed award would have been eligible to be
granted an Award under this Plan if the other company had applied the rules of
this Plan to such grant. In the event the Company assumes an award granted by
another company, the terms and conditions of such award will remain unchanged
(except that the exercise price and the number and nature of shares issuable
upon exercise of any such option will be adjusted appropriately pursuant to
Section 424(a) of the Code). In the event the Company elects to grant a new
Option rather than assuming an existing option, such new Option may be granted
with a similarly adjusted Exercise Price.

         16.  ADOPTION OF PLAN. This Plan will become effective on the date that
it is adopted by the Board (the "EFFECTIVE DATE"). If any Options are ISOs, this
Plan will be approved by the stockholders of the Company (excluding Shares
issued pursuant to this Plan), consistent with applicable laws, within 12 months
after the Plan is adopted by the Board (if such approval is not obtained, the
Options will be NQSOs). Upon the Effective Date, the Committee may grant Options
pursuant to this Plan; provided, however, that the following requirements will
be met for any Option that is an ISO (otherwise the Option will be an NQSO): (a)
the Option may not be exercised prior to initial stockholder approval of this
Plan, and (b) any Option granted pursuant to an increase in the number of Shares
subject to this Plan approved by the Board may not be exercised prior to
approval of such increase by the stockholders of the Company.

         17.  TERM OF PLAN/GOVERNING LAW. Unless earlier terminated as provided
herein, this Plan will terminate ten years from the Effective Date or, if
earlier, the date of stockholder approval. This Plan and all agreements
hereunder shall be governed by and construed in accordance with the laws of the
State of California excluding that body of law pertaining to conflict of laws.

         18.  AMENDMENT OR TERMINATION OF PLAN. The Board may at any time
terminate or amend this Plan in any respect, including without limitation
amendment of any form of Stock Option Agreement or instrument to be executed
pursuant to this Plan; provided, however, that the Board will not, without the
approval of the stockholders of the Company, amend this Plan in any manner that
requires such stockholder approval.

         19.  NONEXCLUSIVITY OF THE PLAN. Neither the adoption of this Plan by
the Board, the submission of this Plan to the stockholders of the Company for
approval, nor any provision of this Plan will be construed as creating any
limitations on the power of the Board to adopt such additional compensation
arrangements as it may deem desirable, including, without limitation, the
granting of stock options and other equity awards otherwise than under this
Plan, and such arrangements may be either generally applicable or applicable
only in specific cases.

                                      -8-

<PAGE>

         20.  DEFINITIONS. As used in this Plan, the following terms will have
the following meanings:

                  "AWARD" means any award of Options under this Plan.

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

                  "CAUSE" means Termination because of (a) any willful material
violation by the Participant of any law or regulation applicable to the business
of the Company or a Parent or Subsidiary of the Company, the Participant's
conviction for, or guilty plea to, a felony or a crime involving moral
turpitude, any willful perpetration by the Participant of a common law fraud,
(b) the Participant's commission of an act of personal dishonesty which involves
personal profit in connection with the Company or any other entity having a
business relationship with the Company, (c) any material breach by the
Participant of any provision of any agreement or understanding between the
Company or any Parent or Subsidiary of the Company and the Participant regarding
the terms of the Participant's service as an employee, director or consultant to
the Company or a Parent or Subsidiary of the Company, including without
limitation, the willful and continued failure or refusal of the Participant to
perform the material duties required of such Participant as an employee,
director or consultant of the Company or a Parent or Subsidiary of the Company,
other than as a result of having a Disability, or a breach of any applicable
invention assignment and confidentiality agreement or similar agreement between
the Company and the Participant, (d) Participant's disregard of the policies of
the Company or any Parent or Subsidiary of the Company so as to cause loss,
damage or injury to the property, reputation or employees of the Company or a
Parent or Subsidiary of the Company or (e) any other misconduct by the
Participant which is materially injurious to the financial condition or business
reputation of, or is otherwise materially injurious to, the Company or a Parent
or Subsidiary of the Company.

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

                  "COMMITTEE" means the committee appointed by the Board to
administer this Plan, or if no committee is appointed, the Board.

                  "COMPANY" means Hybrid Networks, Inc., or any successor
corporation.

                  "DISABILITY" means a disability, whether temporary or
permanent, partial or total, within the meaning of Section 22(e)(3) of the Code,
as determined by the Committee.

                  "EXERCISE PRICE" means the price at which a holder of an
Option may purchase the Shares issuable upon exercise of the Option.

                  "FAIR MARKET VALUE" means, as of any date, the value of a
share of the Company's Common Stock determined as follows:

                  (a)      if such Common Stock is then quoted on the Nasdaq
                           National Market, its closing price on the Nasdaq
                           National Market on the date of determination as
                           reported in THE WALL STREET JOURNAL;

                  (b)      if such Common Stock is publicly traded and is then
                           listed on a national securities exchange, its closing
                           price on the date of determination on the principal
                           national securities exchange on which the Common
                           Stock is listed or admitted to trading as reported in
                           THE WALL STREET JOURNAL;

                  (c)      if such Common Stock is publicly traded but is not
                           quoted on the Nasdaq National Market nor listed or
                           admitted to trading on a national securities
                           exchange, and if current information about the
                           Company is publicly available so as to comply with
                           SEC Rule 144(c), the average of the closing bid and
                           asked prices on the date of determination as reported
                           by THE WALL STREET JOURNAL (or, if

                                      -9-

<PAGE>

                           not so reported, as otherwise reported by any
                           newspaper or other source as the Board may
                           determine); or

                  (d)      if none of the foregoing is applicable, by the
                           Committee in good faith.

                  "OPTION" means an award of an option to purchase Shares
pursuant to Section 5 hereof.

                  "PARENT" means any corporation (other than the Company) in an
unbroken chain of corporations ending with the Company if each of such
corporations other than the Company owns stock possessing 50% or more of the
total combined voting power of all classes of stock in one of the other
corporations in such chain

                  "PARTICIPANT" means a person who receives an Award under this
Plan

                  "PLAN" means this Hybrid Networks, Inc. 1999 Stock Option
Plan, as amended from time to time.

                  "SEC" means the Securities and Exchange Commission.

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

                  "SHARES" means shares of the Company's Common Stock reserved
for issuance under this Plan, as adjusted pursuant to Sections 2 and 15 hereof,
and any successor security.

                  "STOCK OPTION AGREEMENT" means, with respect to each Option,
the signed written agreement between the Company and the Participant setting
forth the terms and conditions of the Award.

                  "SUBSIDIARY" means any corporation (other than the Company) in
an unbroken chain of corporations beginning with the Company if each of the
corporations other than the last corporation in the unbroken chain owns stock
possessing 50% or more of the total combined voting power of all classes of
stock in one of the other corporations in such chain.

                  "TERMINATION" or "TERMINATED" means, for purposes of this Plan
with respect to a Participant, that the Participant has for any reason ceased to
provide substantial services as (a) an employee, officer, director, consultant
or independent contractor to the Company or a Parent or Subsidiary or affiliate
of the Company, or (b) as a consultant, independent contractor or advisor to the
Board of Directors of the Company. A Participant will not be deemed to have
ceased to provide services in the case of (i) sick leave, (ii) military leave,
or (iii) any other leave of absence approved by the Committee, provided that
such leave is for a period of not more than 90 days unless reinstatement upon
the expiration of such leave is guaranteed by contract or statute, or unless
provided otherwise pursuant to formal policy adopted from time to time by the
Company and issued and promulgated in writing. In the case of any Participant on
(i) sick leave, (ii) military leave or (iii) an approved leave of absence, the
Committee may make such provisions respecting suspension of vesting of the Award
while on leave from the Company or a Parent or Subsidiary of the Company as it
may deem appropriate, except that in no event may an Option be exercised after
the expiration of the term set forth in the Stock Option Agreement. The
Committee will have sole discretion to determine whether a Participant has
ceased to provide services and the effective date on which the Participant
ceased to provide services (the "TERMINATION DATE").

                                      -10-

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