Document:

<PAGE>

                                                                 Exhibit 10.17

                                PLC SYSTEMS INC.

                      2000 NON-STATUTORY STOCK OPTION PLAN

1.       PURPOSE

         The purpose of this 2000 Non-statutory Stock Option Plan (the "Plan")
of PLC Systems Inc., a Yukon Territory corporation (the "Company"), is to
advance the interests of the Company's stockholders by enhancing the Company's
ability to retain and motivate persons who make (or are expected to make)
important contributions to the Company by providing such persons with equity
ownership opportunities and thereby better aligning the interests of such
persons with those of the Company's stockholders. Except where the context
otherwise requires, the term "Company" shall include any of the Company's
present or future parent or subsidiary corporations as defined in Sections
424(e) and 424(f) of the Internal Revenue Code of 1986, as amended, and any
regulations promulgated thereunder (the "Code"), and any other business venture
(including, without limitation, joint venture or limited liability company) in
which the Company has a significant interest, as determined by the Board of
Directors of the Company (the "Board").

2.       ELIGIBILITY

         All of the Company's employees are eligible to be granted options
(each, an "Option") under the Plan to purchase shares of common stock, no par
value per share, of the Company ("Common Stock"). Each person who has been
granted an Option under the Plan shall be deemed a "Participant".

3.       ADMINISTRATION, DELEGATION

         (a) ADMINISTRATION BY BOARD OF DIRECTORS. The Plan will be administered
by the Board. The Board shall have authority to grant Options and to adopt,
amend and repeal such administrative rules, guidelines and practices relating to
the Plan as it shall deem advisable. The Board may correct any defect, supply
any omission or reconcile any inconsistency in the Plan or any Option in the
manner and to the extent it shall deem expedient to carry the Plan into effect
and it shall be the sole and final judge of such expediency. All decisions by
the Board shall be made in the Board's sole discretion and shall be final and
binding on all persons having or claiming any interest in the Plan or in any
Option. No director or person acting pursuant to the authority delegated by the
Board shall be liable for any action or determination relating to or under the
Plan made in good faith.

         (b) DELEGATION TO EXECUTIVE OFFICERS. To the extent permitted by
applicable law, the Board may delegate to one or more executive officers of the
Company the power to grant Options and exercise such other powers under the Plan
as the Board may determine, provided that the Board shall fix the maximum number
of shares subject to Options and the maximum number of shares for any one
Participant to be made by such executive officers.

<PAGE>

         (c) APPOINTMENT OF COMMITTEES. To the extent permitted by applicable
law, the Board may delegate any or all of its powers under the Plan to one or
more committees or subcommittees of the Board (a "Committee"). All references in
the Plan to the "Board" shall mean the Board or a Committee of the Board or the
executive officer referred to in Section 3(b) to the extent that the Board's
powers or authority under the Plan have been delegated to such Committee or
executive officer.

4.       STOCK AVAILABLE FOR OPTIONS

         (a) NUMBER OF SHARES. Subject to adjustment under Section 6, Options
may be made under the Plan for up to 317,672 shares of Common Stock. If any
Option expires or is terminated, surrendered or canceled without having been
fully exercised or is forfeited in whole or in part or results in any Common
Stock not being issued, the unused Common Stock covered by such Option shall not
again be available for the grant of Options under the Plan. Shares issued under
the Plan may consist in whole or in part of authorized but unissued shares or
treasury shares.

         (b) PER-PARTICIPANT LIMIT. Subject to adjustment under Section 6, for
Options granted after the Common Stock is registered under the Securities
Exchange Act of 1934 (the "Exchange Act"), the maximum number of shares of
Common Stock with respect to which Options may be granted to any Participant
under the Plan shall be 100,000 per calendar year. In no event shall any
Participant be granted Options under the Plan to purchase a number of shares of
Common Stock in excess of 25% of the number of shares of Common Stock issuable
upon the exercise of stock options held by such Participant as of October 21,
2000.

5.       STOCK OPTIONS

         (a) GENERAL. The Board may grant Options and determine the number of
shares of Common Stock to be covered by each Option, the exercise price of each
Option and the conditions and limitations applicable to the exercise of each
Option, including conditions relating to applicable federal or state securities
laws, as it considers necessary or advisable.

         (b) NON-STATUTORY STOCK OPTIONS. No Option granted under the Plan is
intended to be an "incentive stock option" as defined in Section 422 of the
Code.

         (c) EXERCISE PRICE. The Board shall establish the exercise price at the
time each Option is granted and specify it in the applicable option agreement,
provided, however, that the exercise price shall not be less than 100% of the
fair market value of the Common Stock, as determined by the Board, at the time
the Option is granted.

                                      -2-

<PAGE>

         (d) DURATION OF OPTIONS. Each Option shall be exercisable at such times
and subject to such terms and conditions as the Board may specify in the
applicable option agreement, provided, however, that no Option will be granted
for a term in excess of 10 years.

         (e) EXERCISE OF OPTION. Options may be exercised by delivery to the
Company of a written notice of exercise signed by the proper person or by any
other form of notice (including electronic notice) approved by the Board
together with payment in full as specified in Section 5(f) for the number of
shares for which the Option is exercised.

         (f) PAYMENT UPON EXERCISE. Common Stock purchased upon the exercise of
an Option granted under the Plan shall be paid for as follows:

              (1) in cash or by check, payable to the order of the Company;

              (2) except as the Board may, in its sole discretion, otherwise
provide in an option agreement, by (i) delivery of an irrevocable and
unconditional undertaking by a creditworthy broker to deliver promptly to the
Company sufficient funds to pay the exercise price and any required tax
withholding or (ii) delivery by the Participant to the Company of a copy of
irrevocable and unconditional instructions to a creditworthy broker to deliver
promptly to the Company cash or a check sufficient to pay the exercise price and
any required tax withholding;

              (3) by delivery of shares of Common Stock owned by the Participant
valued at their fair market value as determined by (or in a manner approved by)
the Board in good faith ("Fair Market Value"), provided (i) such method of
payment is then permitted under applicable law and (ii) such Common Stock was
owned by the Participant at least six months prior to such delivery;

              (4) to the extent permitted by the Board, in its sole discretion,
by (i) delivery of a promissory note of the Participant to the Company on terms
determined by the Board, or (ii) payment of such other lawful consideration as
the Board may determine; or

              (5) by any combination of the above permitted forms of payment.

6.       ADJUSTMENTS FOR CHANGES IN COMMON STOCK AND CERTAIN OTHER EVENTS

         (a) CHANGES IN CAPITALIZATION. In the event of any stock split, reverse
stock split, stock dividend, recapitalization, combination of shares,
reclassification of shares, spin-off or other similar change in capitalization
or event, or any distribution to holders of Common Stock other than a normal
cash dividend, (i) the number and class of securities available under this Plan,
(ii) the per-Participant limit set forth in Section 4(b), and (iii) the number
and class of securities and exercise price per share subject to each outstanding
Option shall be appropriately

                                      -3-

<PAGE>

adjusted by the Company (or substituted Options may be granted, if applicable)
to the extent the Board shall determine, in good faith, that such an adjustment
(or substitution) is necessary and appropriate. If this Section 6(a) applies and
Section 6(c) also applies to any event, Section 6(c) shall be applicable to such
event, and this Section 6(a) shall not be applicable.

         (b) LIQUIDATION OR DISSOLUTION. In the event of a proposed liquidation
or dissolution of the Company, the Board shall upon written notice to the
Participants provide that all then unexercised Options will (i) become
exercisable in full as of a specified time at least 10 business days prior to
the effective date of such liquidation or dissolution and (ii) terminate
effective upon such liquidation or dissolution, except to the extent exercised
before such effective date.

         (c) REORGANIZATION AND ACQUISITION EVENTS.

              (1) DEFINITIONS.

                   (a)  A "Reorganization Event" shall mean: (i) any merger or
                        consolidation of the Company with or into another entity
                        as a result of which all of the Common Stock of the
                        Company is converted into or exchanged for the right to
                        receive cash, securities or other property; or (ii) any
                        exchange of all of the Common Stock of the Company for
                        cash, securities or other property pursuant to a share
                        exchange transaction.

                   (b)  An "Acquisition Event" shall mean the consummation of a
                        merger, consolidation, reorganization, recapitalization
                        or share exchange involving the Company or a sale or
                        other disposition of all or substantially all of the
                        assets of the Company (a "Business Combination"),
                        unless, immediately following such Business Combination,
                        all or substantially all of the individuals and entities
                        who were the beneficial owners of the then-outstanding
                        shares of common stock of the Company (the "Outstanding
                        Company Common Stock") and the then-outstanding
                        securities of the Company entitled to vote generally in
                        the election of directors (the "Outstanding Company
                        Voting Securities") immediately prior to such Business
                        Combination beneficially own, directly or indirectly,
                        more than 50% of the then-outstanding shares of common
                        stock and the combined voting power of the
                        then-outstanding securities entitled to vote generally
                        in the election of directors, respectively, of the
                        resulting or acquiring corporation in such Business
                        Combination (which shall include, without limitation, a
                        corporation which as a result of such transaction owns
                        the Company or substantially all of the Company's assets
                        either

                                      -4-

<PAGE>

                        directly or through one or more subsidiaries) (such
                        resulting or acquiring corporation is referred to herein
                        as the "Acquiring Corporation") in substantially the
                        same proportions as their ownership of the Outstanding
                        Company Common Stock and Outstanding Company Voting
                        Securities, respectively, immediately prior to such
                        Business Combination.

              (2)  EFFECT ON OPTIONS.

                   (a)  REORGANIZATION EVENT. Upon the occurrence of a
                        Reorganization Event that is not also an Acquisition
                        Event, or the execution by the Company of any agreement
                        with respect to a Reorganization Event that will not
                        also result in an Acquisition Event, the Board shall
                        provide that all outstanding Options shall be assumed,
                        or equivalent options shall be substituted, by the
                        acquiring or succeeding corporation (or an affiliate
                        thereof). For purposes hereof, an Option shall be
                        considered to be assumed if, following consummation of
                        the Reorganization Event, the Option confers the right
                        to purchase, for each share of Common Stock subject to
                        the Option immediately prior to the consummation of the
                        Reorganization Event, the consideration (whether cash,
                        securities or other property) received as a result of
                        the Reorganization Event by holders of Common Stock for
                        each share of Common Stock held immediately prior to the
                        consummation of the Reorganization Event (and if holders
                        were offered a choice of consideration, the type of
                        consideration chosen by the holders of a majority of the
                        outstanding shares of Common Stock); provided, however,
                        that if the consideration received as a result of the
                        Reorganization Event is not solely common stock of the
                        acquiring or succeeding corporation (or an affiliate
                        thereof), the Company may, with the consent of the
                        acquiring or succeeding corporation, provide for the
                        consideration to be received upon the exercise of
                        Options to consist solely of common stock of the
                        acquiring or succeeding corporation (or an affiliate
                        thereof) equivalent in fair market value to the per
                        share consideration received by holders of outstanding
                        shares of Common Stock as a result of the Reorganization
                        Event.

                             Notwithstanding the foregoing, if the acquiring or
                        succeeding corporation (or an affiliate thereof) does
                        not agree to assume, or substitute for, such Options,
                        then the Board shall, upon written notice to the
                        Participants, provide that all then unexercised

                                      -5-

<PAGE>

                        Options will become exercisable in full as of a
                        specified time prior to the Reorganization Event and
                        will terminate immediately prior to the consummation of
                        such Reorganization Event, except to the extent
                        exercised by the Participants before the consummation of
                        such Reorganization Event; provided, however, in the
                        event of a Reorganization Event under the terms of which
                        holders of Common Stock will receive upon consummation
                        thereof a cash payment for each share of Common Stock
                        surrendered pursuant to such Reorganization Event (the
                        "Acquisition Price"), then the Board may instead provide
                        that all outstanding Options shall terminate upon
                        consummation of such Reorganization Event and that each
                        Participant shall receive, in exchange therefor, a cash
                        payment equal to the amount (if any) by which (A) the
                        Acquisition Price multiplied by the number of shares of
                        Common Stock subject to such outstanding Options
                        (whether or not then exercisable), exceeds (B) the
                        aggregate exercise price of such Options.

                   (b)  ACQUISITION EVENT. In the event of the consummation of
                        an Acquisition Event (regardless of whether such
                        Acquisition Event also constitutes a Reorganization
                        Event), all then-unexercised Options will become
                        exercisable in full as of time specified by the Board
                        prior to the consummation of the Acquisition Event and
                        will terminate immediately prior to the consummation of
                        such Acquisition Event, except to the extent exercised
                        by the Participants before the consummation of such
                        Acquisition Event; provided, however, in the event of an
                        Acquisition Event under the terms of which holders of
                        Common Stock will receive upon consummation thereof a
                        cash payment for each share of Common Stock surrendered
                        pursuant to such Acquisition Event (the "Acquisition
                        Price"), then the Board may instead provide that all
                        outstanding Options shall terminate upon consummation of
                        such Acquisition Event and that each Participant shall
                        receive, in exchange therefor, a cash payment equal to
                        the amount (if any) by which (A) the Acquisition Price
                        multiplied by the number of shares of Common Stock
                        subject to such outstanding Options (whether or not then
                        exercisable), exceeds (B) the aggregate exercise price
                        of such Options.

                                      -6-

<PAGE>

7.       GENERAL PROVISIONS APPLICABLE TO OPTIONS

         (a) TRANSFERABILITY OF OPTIONS. Except as the Board may otherwise
determine or provide in an Option, Options shall not be sold, assigned,
transferred, pledged or otherwise encumbered by the person to whom they are
granted, either voluntarily or by operation of law, except by will or the laws
of descent and distribution, and, during the life of the Participant, shall be
exercisable only by the Participant. References to a Participant, to the extent
relevant in the context, shall include references to authorized transferees.

         (b) DOCUMENTATION. Each Option shall be evidenced by a written
instrument in such form as the Board shall determine. Each Option may contain
terms and conditions in addition to those set forth in the Plan.

         (c) BOARD DISCRETION. Except as otherwise provided by the Plan, each
Option may be made alone or in addition or in relation to any other Option. The
terms of each Option grant need not be identical, and the Board need not treat
Participants uniformly.

         (d) TERMINATION OF STATUS. The Board shall determine the effect on an
Option of the disability, death, retirement, authorized leave of absence or
other change in the employment or other status of a Participant and the extent
to which, and the period during which, the Participant, the Participant's legal
representative, conservator, guardian or Designated Beneficiary may exercise
rights under the Option.

         (e) WITHHOLDING. Each Participant shall pay to the Company, or make
provision satisfactory to the Board for payment of, any taxes required by law to
be withheld in connection with Options to such Participant no later than the
date of the event creating the tax liability. Except as the Board may otherwise
provide in an Option, Participants may, to the extent then permitted under
applicable law, satisfy such tax obligations in whole or in part by delivery of
shares of Common Stock, including shares retained from the Option creating the
tax obligation, valued at their Fair Market Value; provided, however, that the
total tax withholding where stock is being used to satisfy such tax obligations
cannot exceed the Company's minimum statutory withholding obligations (based on
minimum statutory withholding rates for federal and state tax purposes,
including payroll taxes, that are applicable to such supplemental taxable
income). The Company may, to the extent permitted by law, deduct any such tax
obligations from any payment of any kind otherwise due to a Participant.

         (f) AMENDMENT OF OPTION. The Board may amend, modify or terminate any
outstanding Option, including but not limited to, substituting therefor another
Option of the same or a different type, and changing the date of exercise or
realization provided that the Participant's consent to such action shall be
required unless the Board determines that the action, taking into account any
related action, would not materially and adversely affect the Participant.

         (g) CONDITIONS ON DELIVERY OF STOCK. The Company will not be obligated
to deliver any shares of Common Stock pursuant to the Plan or to remove
restrictions from shares

                                      -7-

<PAGE>

previously delivered under the Plan until (i) all conditions of the Option have
been met or removed to the satisfaction of the Company, (ii) in the opinion of
the Company's counsel, all other legal matters in connection with the issuance
and delivery of such shares have been satisfied, including any applicable
securities laws and any applicable stock exchange or stock market rules and
regulations, and (iii) the Participant has executed and delivered to the Company
such representations or agreements as the Company may consider appropriate to
satisfy the requirements of any applicable laws, rules or regulations.

         (h) ACCELERATION. The Board may at any time provide that any Options
shall become immediately exercisable in full or in part.

8.       MISCELLANEOUS

         (a) NO RIGHT TO EMPLOYMENT OR OTHER STATUS. No person shall have any
claim or right to be granted an Option, and the grant of an Option shall not be
construed as giving a Participant the right to continued employment or any other
relationship with the Company. The Company expressly reserves the right at any
time to dismiss or otherwise terminate its relationship with a Participant free
from any liability or claim under the Plan, except as expressly provided in the
applicable Option.

         (b) NO RIGHTS AS STOCKHOLDER. Subject to the provisions of the
applicable Option, no Participant or Designated Beneficiary shall have any
rights as a stockholder with respect to any shares of Common Stock to be
distributed with respect to an Option until becoming the record holder of such
shares. Notwithstanding the foregoing, in the event the Company effects a split
of the Common Stock by means of a stock dividend and the exercise price of and
the number of shares subject to such Option are adjusted as of the date of the
distribution of the dividend (rather than as of the record date for such
dividend), then an optionee who exercises an Option between the record date and
the distribution date for such stock dividend shall be entitled to receive, on
the distribution date, the stock dividend with respect to the shares of Common
Stock acquired upon such Option exercise, notwithstanding the fact that such
shares were not outstanding as of the close of business on the record date for
such stock dividend.

         (c) EFFECTIVE DATE AND TERM OF PLAN. The Plan shall become effective on
the date on which it is adopted by the Board. No Options shall be granted under
the Plan after the completion of ten years from the date on which the Plan was
adopted by the Board but Options previously granted may extend beyond that date.

         (d) AMENDMENT OF PLAN. The Board may amend, suspend or terminate the
Plan or any portion thereof at any time.

                                      -8-

<PAGE>

         (e) GOVERNING LAW. The provisions of the Plan and all Options granted
hereunder shall be governed by and interpreted in accordance with the laws of
the Commonwealth of Massachusetts, without regard to any applicable conflicts of
law.

         (f) FOREIGN NATIONALS. Options may be granted to participants who are
foreign nationals or employed outside the United States on such terms and
conditions different from those specified in the Plan as the Board considers
necessary or advisable to achieve the purposes of the Plan.

         (g) INTERPRETATION OF PLAN. This Plan is intended to provide for the
participation of all, or substantially all, of the Company's employees in a fair
and equitable manner in accordance with Section 711(b) of the American Stock
Exchange and shall be construed accordingly.

                                            Approved by the Board of Directors
                                            on October 24, 2000

                                      -9-<PAGE>

                                                                 Exhibit 10.18

                                PLC SYSTEMS INC.

                           2000 EQUITY INCENTIVE PLAN

1.       PURPOSE

         The purpose of this 2000 Equity Incentive Plan (the "Plan") of PLC
Systems Inc., a Yukon Territory corporation (the "Company"), is to advance the
interests of the Company's stockholders by enhancing the Company's ability to
attract, retain and motivate persons who make (or are expected to make)
important contributions to the Company by providing such persons with equity
ownership opportunities and performance-based incentives and thereby better
aligning the interests of such persons with those of the Company's stockholders.
Except where the context otherwise requires, the term "Company" shall include
any of the Company 's present or future subsidiary corporations as defined in
Section 424(f) of the Internal Revenue Code of 1986, as amended, and any
regulations promulgated thereunder (the "Code").

2.       ELIGIBILITY

         All of the Company's employees, officers, directors, consultants and
advisors (and any individuals who have accepted an offer for employment) are
eligible to be granted options, restricted stock awards, or other stock-based
awards (each, an "Award") under the Plan. Each person who has been granted an
Award under the Plan shall be deemed a "Participant".

3.       ADMINISTRATION, DELEGATION

         (a) ADMINISTRATION BY BOARD OF DIRECTORS. The Plan will be administered
by the Board of Directors of the Company (the "Board"). The Board shall have
authority to grant Awards and to adopt, amend and repeal such administrative
rules, guidelines and practices relating to the Plan as it shall deem advisable.
The Board may correct any defect, supply any omission or reconcile any
inconsistency in the Plan or any Award in the manner and to the extent it shall
deem expedient to carry the Plan into effect and it shall be the sole and final
judge of such expediency. All decisions by the Board shall be made in the
Board's sole discretion and shall be final and binding on all persons having or
claiming any interest in the Plan or in any Award. No director or person acting
pursuant to the authority delegated by the Board shall be liable for any action
or determination relating to or under the Plan made in good faith.

         (b) DELEGATION TO EXECUTIVE OFFICERS. To the extent permitted by
applicable law, the Board may delegate to one or more executive officers of the
Company the power to make Awards and exercise such other powers under the Plan
as the Board may determine, provided that the Board shall fix the maximum number
of shares subject to Awards and the maximum number of shares for any one
Participant to be made by such executive officers.

         (c) APPOINTMENT OF COMMITTEES. To the extent permitted by applicable
law, the Board may delegate any or all of its powers under the Plan to one or
more committees or subcommittees of the Board (a "Committee"). All references in
the Plan to the "Board" shall

<PAGE>

mean the Board or a Committee of the Board or the executive officer referred to
in Section 3(b) to the extent that the Board's powers or authority under the
Plan have been delegated to such Committee or executive officer.

4.       STOCK AVAILABLE FOR AWARDS

         (a) NUMBER OF SHARES. Subject to adjustment under Section 8, Awards may
be made under the Plan for up to 500,000 shares of common stock, no par value
per share, of the Company (the "Common Stock"). If any Award expires or is
terminated, surrendered or canceled without having been fully exercised or is
forfeited in whole or in part or results in any Common Stock not being issued,
the unused Common Stock covered by such Award shall again be available for the
grant of Awards under the Plan, subject, however, in the case of Incentive Stock
Options (as hereinafter defined), to any limitation required under the Code.
Shares issued under the Plan may consist in whole or in part of authorized but
unissued shares or treasury shares.

         (b) PER-PARTICIPANT LIMIT. Subject to adjustment under Section 8, for
Awards granted after the Common Stock is registered under the Securities
Exchange Act of 1934 (the "Exchange Act"), the maximum number of shares of
Common Stock with respect to which Awards may be granted to any Participant
under the Plan shall be 250,000 per calendar year. The per-Participant limit
described in this Section 4(b) shall be construed and applied consistently with
Section 162(m) of the Code ("Section 162(m)").

5.       STOCK OPTIONS

         (a) GENERAL. The Board may grant options to purchase Common Stock
(each, an "Option") and determine the number of shares of Common Stock to be
covered by each Option, the exercise price of each Option and the conditions and
limitations applicable to the exercise of each Option, including conditions
relating to applicable federal or state securities laws, as it considers
necessary or advisable. An Option which is not intended to be an Incentive Stock
Option (as hereinafter defined) shall be designated a "Nonstatutory Stock
Option".

         (b) INCENTIVE STOCK OPTIONS. An Option that the Board intends to be an
"incentive stock option" as defined in Section 422 of the Code (an "Incentive
Stock Option") shall only be granted to employees of the Company and shall be
subject to and shall be construed consistently with the requirements of Section
422 of the Code. The Company shall have no liability to a Participant, or any
other party, if an Option (or any part thereof) which is intended to be an
Incentive Stock Option is not an Incentive Stock Option.

         (c) EXERCISE PRICE. The Board shall establish the exercise price at the
time each Option is granted and specify it in the applicable option agreement,
provided, however, that the exercise price shall be not less than 100% of the
fair market value of the Common Stock, as determined by the Board, at the time
the Option is granted.

<PAGE>

         (d) DURATION OF OPTIONS. Each Option shall be exercisable at such times
and subject to such terms and conditions as the Board may specify in the
applicable option agreement, provided, however, that no Option will be granted
for a term in excess of 10 years.

         (e) EXERCISE OF OPTION. Options may be exercised by delivery to the
Company of a written notice of exercise signed by the proper person or by any
other form of notice (including electronic notice) approved by the Board
together with payment in full as specified in Section 5(f) for the number of
shares for which the Option is exercised.

         (f) PAYMENT UPON EXERCISE. Common Stock purchased upon the exercise of
an Option granted under the Plan shall be paid for as follows:

         (1)  in cash or by check, payable to the order of the Company;

         (2)  except as the Board may, in its sole discretion, otherwise provide
              in an option agreement, by (i) delivery of an irrevocable and
              unconditional undertaking by a creditworthy broker to deliver
              promptly to the Company sufficient funds to pay the exercise price
              or (ii) delivery by the Participant to the Company of a copy of
              irrevocable and unconditional instructions to a creditworthy
              broker to deliver promptly to the Company cash or a check
              sufficient to pay the exercise price;

         (3)  by delivery of shares of Common Stock owned by the Participant
              valued at their fair market value as determined by (or in a manner
              approved by) the Board in good faith ("Fair Market Value"),
              provided (i) such method of payment is then permitted under
              applicable law and (ii) such Common Stock was owned by the
              Participant at least six months prior to such delivery;

         (4)  to the extent permitted by the Board, in its sole discretion by
              (i) delivery of a promissory note of the Participant to the
              Company on terms determined by the Board, or (ii) payment of such
              other lawful consideration as the Board may determine; or

         (5)  by any combination of the above permitted forms of payment.

6.       RESTRICTED STOCK

         (a) GRANTS. The Board may grant Awards entitling recipients to acquire
shares of Common Stock, subject to the right of the Company to repurchase all or
part of such shares at their issue price or other stated or formula price (or to
require forfeiture of such shares if issued at no cost) from the recipient in
the event that conditions specified by the Board in the applicable Award are not
satisfied prior to the end of the applicable restriction period or periods
established by the Board for such Award (each, a "Restricted Stock Award").

         (b) TERMS AND CONDITIONS. The Board shall determine the terms and
conditions of any such Restricted Stock Award, including the conditions for
repurchase (or forfeiture) and the issue price, if any. Any stock certificates
issued in respect of a Restricted Stock Award shall be

<PAGE>

registered in the name of the Participant and, unless otherwise determined by
the Board, deposited by the Participant, together with a stock power endorsed in
blank, with the Company (or its designee). At the expiration of the applicable
restriction periods, the Company (or such designee) shall deliver the
certificates no longer subject to such restrictions to the Participant or if the
Participant has died, to the beneficiary designated, in a manner determined by
the Board, by a Participant to receive amounts due or exercise rights of the
Participant in the event of the Participant's death (the "Designated
Beneficiary"). In the absence of an effective designation by a Participant,
Designated Beneficiary shall mean the Participant's estate.

7.       OTHER STOCK-BASED AWARDS

         The Board shall have the right to grant other Awards based upon the
Common Stock having such terms and conditions as the Board may determine,
including the grant of shares based upon certain conditions, the grant of
securities convertible into Common Stock and the grant of stock appreciation
rights.

8.       ADJUSTMENTS FOR CHANGES IN COMMON STOCK AND CERTAIN OTHER EVENTS

         (a) CHANGES IN CAPITALIZATION. In the event of any stock split, reverse
stock split, stock dividend, recapitalization, combination of shares,
reclassification of shares, spin-off or other similar change in capitalization
or event, or any distribution to holders of Common Stock other than a normal
cash dividend, (i) the number and class of securities available under this Plan,
(ii) the per-Participant limit set forth in Section 4(b), (iii) the number and
class of securities and exercise price per share subject to each outstanding
Option, (iv) the repurchase price per share subject to each outstanding
Restricted Stock Award, and (v) the terms of each other outstanding Award shall
be appropriately adjusted by the Company (or substituted Awards may be made, if
applicable) to the extent the Board shall determine, in good faith, that such an
adjustment (or substitution) is necessary and appropriate. If this Section 8(a)
applies and Section 8(c) also applies to any event, Section 8(c) shall be
applicable to such event, and this Section 8(a) shall not be applicable.

         (b) LIQUIDATION OR DISSOLUTION. In the event of a proposed liquidation
or dissolution of the Company, the Board shall upon written notice to the
Participants provide that all then unexercised Options will (i) become
exercisable in full as of a specified time at least 10 business days prior to
the effective date of such liquidation or dissolution and (ii) terminate
effective upon such liquidation or dissolution, except to the extent exercised
before such effective date. The Board may specify the effect of a liquidation or
dissolution on any Restricted Stock Award or other Award granted under the Plan
at the time of the grant of such Award.

         (c)      ACQUISITION EVENTS

         (1)      DEFINITION. An "Acquisition Event" shall mean: (a) any merger
                  or consolidation of the Company with or into another entity as
                  a result of which the Common Stock is converted into or
                  exchanged for the right to receive cash, securities or other
                  property or (b) any exchange of shares of the Company for
                  cash, securities or other property pursuant to a statutory
                  share exchange transaction.

<PAGE>

         (2)      CONSEQUENCES OF AN ACQUISITION EVENT ON OPTIONS. Upon the
                  occurrence of an Acquisition Event, or the execution by the
                  Company of any agreement with respect to an Acquisition Event,
                  the Board shall provide that all outstanding Options shall be
                  assumed, or equivalent options shall be substituted, by the
                  acquiring or succeeding corporation (or an affiliate thereof).
                  For purposes hereof, an Option shall be considered to be
                  assumed if, following consummation of the Acquisition Event,
                  the Option confers the right to purchase, for each share of
                  Common Stock subject to the Option immediately prior to the
                  consummation of the Acquisition Event, the consideration
                  (whether cash, securities or other property) received as a
                  result of the Acquisition Event by holders of Common Stock for
                  each share of Common Stock held immediately prior to the
                  consummation of the Acquisition Event (and if holders were
                  offered a choice of consideration, the type of consideration
                  chosen by the holders of a majority of the outstanding shares
                  of Common Stock); provided, however, that if the consideration
                  received as a result of the Acquisition Event is not solely
                  common stock of the acquiring or succeeding corporation (or an
                  affiliate thereof), the Company may, with the consent of the
                  acquiring or succeeding corporation, provide for the
                  consideration to be received upon the exercise of Options to
                  consist solely of common stock of the acquiring or succeeding
                  corporation (or an affiliate thereof) equivalent in fair
                  market value to the per share consideration received by
                  holders of outstanding shares of Common Stock as a result of
                  the Acquisition Event.

Notwithstanding the foregoing, if the acquiring or succeeding corporation (or an
affiliate thereof) does not agree to assume, or substitute for, such Options,
then the Board shall, upon written notice to the Participants, provide that all
then unexercised Options will become exercisable in full as of a specified time
prior to the Acquisition Event and will terminate immediately prior to the
consummation of such Acquisition Event, except to the extent exercised by the
Participants before the consummation of such Acquisition Event; provided,
however, that in the event of an Acquisition Event under the terms of which
holders of Common Stock will receive upon consummation thereof a cash payment
for each share of Common Stock surrendered pursuant to such Acquisition Event
(the "Acquisition Price"), then the Board may instead provide that all
outstanding Options shall terminate upon consummation of such Acquisition Event
and that each Participant shall receive, in exchange therefor, a cash payment
equal to the amount (if any) by which (A) the Acquisition Price multiplied by
the number of shares of Common Stock subject to such outstanding Options
(whether or not then exercisable), exceeds (B) the aggregate exercise price of
such Options.

         (3)      CONSEQUENCES OF AN ACQUISITION EVENT ON RESTRICTED STOCK
                  AWARDS. Upon the occurrence of an Acquisition Event, the
                  repurchase and other rights of the Company under each
                  outstanding Restricted Stock Award shall inure to the benefit
                  of the Company's successor and shall apply to the cash,
                  securities or other property which the Common Stock was
                  converted into or exchanged for pursuant to such Acquisition
                  Event in the same manner and to the same extent as they
                  applied to the Common Stock subject to such Restricted Stock
                  Award.

<PAGE>

         (4)      CONSEQUENCES OF AN ACQUISITION EVENT ON OTHER AWARDS. The
                  Board shall specify the effect of an Acquisition Event on any
                  other Award granted under the Plan at the time of the grant of
                  such Award.

9.       GENERAL PROVISIONS APPLICABLE TO AWARDS

         (a) TRANSFERABILITY OF AWARDS. Except as the Board may otherwise
determine or provide in an Award, Awards shall not be sold, assigned,
transferred, pledged or otherwise encumbered by the person to whom they are
granted, either voluntarily or by operation of law, except by will or the laws
of descent and distribution, and, during the life of the Participant, shall be
exercisable only by the Participant. References to a Participant, to the extent
relevant in the context, shall include references to authorized transferees.

         (b) DOCUMENTATION. Each Award shall be evidenced by a written
instrument in such form as the Board shall determine. Each Award may contain
terms and conditions in addition to those set forth in the Plan.

         (c) BOARD DISCRETION. Except as otherwise provided by the Plan, each
Award may be made alone or in addition or in relation to any other Award. The
terms of each Award need not be identical, and the Board need not treat
Participants uniformly.

         (d) TERMINATION OF STATUS. The Board shall determine the effect on an
Award of the disability, death, retirement, authorized leave of absence or other
change in the employment or other status of a Participant and the extent to
which, and the period during which, the Participant, the Participant's legal
representative, conservator, guardian or Designated Beneficiary may exercise
rights under the Award.

         (e) WITHHOLDING. Each Participant shall pay to the Company, or make
provision satisfactory to the Board for payment of, any taxes required by law to
be withheld in connection with Awards to such Participant no later than the date
of the event creating the tax liability. Except as the Board may otherwise
provide in an Award, Participants may, to the extent then permitted under
applicable law, satisfy such tax obligations in whole or in part by delivery of
shares of Common Stock, including shares retained from the Award creating the
tax obligation, valued at their Fair Market Value. The Company may, to the
extent permitted by law, deduct any such tax obligations from any payment of any
kind otherwise due to a Participant.

         (f) AMENDMENT OF AWARD. The Board may amend, modify or terminate any
outstanding Award, including but not limited to, substituting therefor another
Award of the same or a different type, changing the date of exercise or
realization, and converting an Incentive Stock Option to a Nonstatutory Stock
Option, provided that the Participant's consent to such action shall be required
unless the Board determines that the action, taking into account any related
action, would not materially and adversely affect the Participant.

         (g) CONDITIONS ON DELIVERY OF STOCK. The Company will not be obligated
to deliver any shares

<PAGE>

of Common Stock pursuant to the Plan or to remove restrictions from shares
previously delivered under the Plan until (i) all conditions of the Award have
been met or removed to the satisfaction of the Company, (ii) in the opinion of
the Company's counsel, all other legal matters in connection with the issuance
and delivery of such shares have been satisfied, including any applicable
securities laws and any applicable stock exchange or stock market rules and
regulations, and (iii) the Participant has executed and delivered to the Company
such representations or agreements as the Company may consider appropriate to
satisfy the requirements of any applicable laws, rules or regulations.

         (h) ACCELERATION. The Board may at any time provide that any Options
shall become immediately exercisable in full or in part, that any Restricted
Stock Awards shall be free of restrictions in full or in part or that any other
Awards may become exercisable in full or in part or free of some or all
restrictions or conditions, or otherwise realizable in full or in part, as the
case may be.

10.      MISCELLANEOUS

         (a) NO RIGHT TO EMPLOYMENT OR OTHER STATUS. No person shall have any
claim or right to be granted an Award, and the grant of an Award shall not be
construed as giving a Participant the right to continued employment or any other
relationship with the Company. The Company expressly reserves the right at any
time to dismiss or otherwise terminate its relationship with a Participant free
from any liability or claim under the Plan, except as expressly provided in the
applicable Award.

         (b) NO RIGHTS AS STOCKHOLDER. Subject to the provisions of the
applicable Award, no Participant or Designated Beneficiary shall have any rights
as a stockholder with respect to any shares of Common Stock to be distributed
with respect to an Award until becoming the record holder of such shares.
Notwithstanding the foregoing, in the event the Company effects a split of the
Common Stock by means of a stock dividend and the exercise price of and the
number of shares subject to such Option are adjusted as of the date of the
distribution of the dividend (rather than as of the record date for such
dividend), then an optionee who exercises an Option between the record date and
the distribution date for such stock dividend shall be entitled to receive, on
the distribution date, the stock dividend with respect to the shares of Common
Stock acquired upon such Option exercise, notwithstanding the fact that such
shares were not outstanding as of the close of business on the record date for
such stock dividend.

         (c) EFFECTIVE DATE AND TERM OF PLAN. The Plan shall become effective on
the date on which it is adopted by the Board, but no Award granted to a
Participant that is intended to comply with Section 162(m) shall become
exercisable, vested or realizable, as applicable to such Award, unless and until
the Plan has been approved by the Company's stockholders to the extent
stockholder approval is required by Section 162(m) in the manner required under
Section 162(m) (including the vote required under Section 162(m)). No Awards
shall be granted under the Plan after the completion of ten years from the
earlier of (i) the date on which the Plan was adopted by the Board or (ii) the
date the Plan was approved by the Company's stockholders, but Awards previously
granted may extend beyond that date.

<PAGE>

         (d) AMENDMENT OF PLAN. The Board may amend, suspend or termina te the
Plan or any portion thereof at any time, provided that to the extent required by
Section 162(m), no Award granted to a Participant that is intended to comply
with Section 162(m) after the date of such amendment shall become exercisable,
realizable or vested, as applicable to such Award, unless and until such
amendment shall have been approved by the Company's stockholders as required by
Section 162(m) (including the vote required under Section 162(m)).

         (e) GOVERNING LAW. The provisions of the Plan and all Awards made
hereunder shall be governed by and interpreted in accordance with the laws of
the Commonwealth of Massachusetts, without regard to any applicable conflicts of
law.

         (f) FOREIGN NATIONALS. Awards may be granted to participants who are
foreign nationals or employed outside the United States on such terms and
conditions different from those specified in the Plan as the Board considers
necessary or advisable to achieve the purposes of the Plan.

                                            Approved by the Board of Directors
                                            on February 1, 2000

                                            Approved by the stockholders on
                                            May 24, 2000

Source: [{"source": "alea-institute/alea-institute/kl3m-data-edgar-agreements/train-00035-of-00352.parquet"}, [{"source": "alea-institute/alea-institute/kl3m-data-edgar-agreements/train-00035-of-00352.parquet"}]]