Document:

EXHIBIT 4.10

                  CERTIFICATE OF THE DESIGNATION, VOTING POWER,
              PREFERENCE AND RELATIVE, PARTICIPATING, OPTIONAL AND
             OTHER SPECIAL RIGHTS AND QUALIFICATIONS, LIMITATIONS OR
         RESTRICTIONS OF THE SPECIAL SERIES A PREFERRED VOTING STOCK OF
                             JAWS TECHNOLOGIES, INC.

               The undersigned hereby certify that they are the duly elected and
acting President and Secretary of JAWS TECHNOLOGIES, INC., a Nevada corporation
(the "Corporation"), and pursuant to Nev. Rev. Stat. Section 78.1955, DO HEREBY
CERTIFY:

               WHEREAS,  pursuant  to  authority  conferred  upon  the  Board of
Directors by ARTICLE VI of the Articles of Incorporation  (the "Articles"),  the
Board of  Directors  of the  Corporation  by  unanimous  written  consent  dated
November  30,  1999  adopted the  following  resolution  creating  one series of
Preferred Stock  designated as "Special Series A Preferred  Voting Stock" of the
Corporation;

               RESOLVED,  that pursuant to the authority expressly vested in the
Board of Directors of the  Corporation in accordance  with the provisions of the
Articles, one series of Preferred Stock of the Corporation, par value $0.001, be
and it is hereby,  created and that the  designation  and amount thereof and the
voting powers,  preferences,  and relative  rights of the shares of such series,
and the limitations and restrictions thereof, are as follows:

               Section 1.  Designation and Amount.  A series of Preferred Stock,
consisting of one share of such stock, is hereby designated as "Special Series A
Preferred  Voting  Stock." The  outstanding  share of Special Series A Preferred
Voting  Stock  shall be  entitled  at any  relevant  date to the number of votes
(including for purposes of determining  the presence of a quorum)  determined in
accordance with the terms and conditions of each of the following:

        (a)    the rights,  privileges,  restrictions and conditions attached to
               the Exchangeable  Shares in the capital of Jaws Acquisition Corp.
               ("JAC"),  a  corporation  incorporated  under  the  laws  of  the
               Province of Alberta;

        (b)    the Support  Agreement dated effective  November 30, 1999 between
               the Corporation and JAC; and

        (c)    the Voting and Exchange Trust Agreement dated effective  November
               30,  1999  among  the  Corporation,  JAC and the  Montreal  Trust
               Company of Canada;

on all matters presented to the holders of Common Stock of the Corporation, with
the Special Series A Preferred  Voting Stock and Common Stock voting together as
a single class.  The Special Series A Preferred Voting Stock shall have no other
voting rights except as required by law. No dividend shall be paid to the holder
of Special  Series A  Preferred  Voting  Stock.  The share of  Special  Series A
Preferred  Voting  Stock  shall be  entitled  to  $0.001 on  liquidation  of the
Corporation in preference to any shares of Common Stock of the Corporation,  but
only after the liquidation  preference of any other shares of Preferred Stock of
the Corporation has been paid in

922525.1

<PAGE>

                                         -2-

full. The Special Series A Preferred  Voting Stock is not  convertible  into any
other  class or series of the  capital  stock of the  Corporation  or into cash,
property or other rights,  and may not be redeemed,  except pursuant to the last
sentence of this Section 1. The share of Special Series A Preferred Voting Stock
purchased or otherwise  acquired by the Corporation  shall be deemed retired and
shall be canceled and may not thereafter be reissued or otherwise disposed of by
the Corporation.  So long as any Exchangeable Shares in the capital of JAC shall
be outstanding,  the number of shares  comprising the Special Series A Preferred
Voting  Stock  shall not be  increased  or  decreased  and no other  term of the
Special  Series A  Preferred  Voting  Stock  shall be  amended,  except upon the
approval of the holder of the  outstanding  share of Special  Series A Preferred
Voting Stock. At such time as no Exchangeable Shares in the capital of JAC shall
be outstanding,  the Special Series A Preferred Voting Stock shall automatically
be redeemed,  with the $0.001  liquidation  preference due and payable upon such
redemption.

        Section  2.  Restriction.  So long as the  share  of  Special  Series  A
Preferred  Voting Stock is outstanding,  the Corporation  shall (a) fully comply
with all terms of the  Exchangeable  Shares in the  capital  of JAC and with all
contractual  obligations of the Corporation  associated  with such  Exchangeable
Shares and (b) not amend, alter, change or repeal this Section 2 except upon the
written  approval  of the holder of the  outstanding  share of Special  Series A
Preferred Voting Stock.

               IN WITNESS  WHEREOF,  the Corporation has caused this Certificate
of  Designation  to be duly executed in its  corporate  name on this 30th day of
November, 1999.

                                            JAWS TECHNOLOGIES, INC.

                                            By: /s/ Robert J. Kubbernus
                                                ----------------------------
                                                Robert J. Kubbernus
                                                President

                                            By: /s/Vikki Robinson
                                                ----------------------------
                                                Vikki Robinson
                                                Secretary

        This  instrument  was  acknowledged  before me on  November  30, 1999 by
Robert J.  Kubbernus,  as President  of JAWS  TECHNOLOGIES,  INC.,  and by Vikki
Robinson as Secretary of JAWS TECHNOLOGIES, INC.

        Seal                                /s/ Debbie E. Bryden
                                            --------------------------------
                                            A Notary Public in and for DEBBIE E.
                                            BRYDEN
                                            the Province of Alberta

922525.1

<PAGE>EXHIBIT 4.11

                             JAWS TECHNOLOGIES, INC.

                                STOCK OPTION PLAN

<PAGE>   2

                                TABLE OF CONTENTS

<TABLE>
<CAPTION>
                                                                                          Page
                                                                                          ----
<S>      <C>                                                                                <C>
1.       Purpose.............................................................................1

2.       Incentive and Non-Qualified Stock Options...........................................1

3.       Definitions.........................................................................1
         3.1      Board......................................................................1
         3.2      Code.......................................................................1
         3.3      Common Stock...............................................................1
         3.4      Company....................................................................1
         3.5      Disabled or Disability.....................................................1
         3.6      Fair Market Value..........................................................1
         3.7      Incentive Stock Option.....................................................2
         3.8      Non-Qualified Stock Option.................................................2
         3.9      Optionee...................................................................2
         3.10     Plan.......................................................................2
         3.11     Plan Administrator.........................................................2
         3.12     Stock Option or Option.....................................................2

4.       Administration......................................................................2
         4.1      Administration by Board....................................................2
         4.2      Administration by Committee................................................3

5.       Eligibility.........................................................................3

6.       Shares Subject to Options...........................................................3

7.       Terms and Conditions of Options.....................................................4
         7.1      Number of Shares Subject to Option.........................................4
         7.2      Option Price...............................................................4
         7.3      Notice and Payment.........................................................4
         7.4      Term of Option.............................................................5
         7.5      Exercise of Option.........................................................5
         7.6      No Transfer of Option......................................................5
         7.7      Limit on Incentive Stock Options...........................................6
         7.8      Restriction on Issuance of Shares..........................................6
         7.9      Investment Representation..................................................6
         7.10     Rights as a Shareholder or Employee........................................6
         7.11     No Fractional Shares.......................................................7
         7.12     Exercisability in the Event of Death.......................................7
         7.13     Recapitalization or Reorganization of Company..............................7
</TABLE>

                                       -i-
<PAGE>   3

<TABLE>
<S>      <C>                                                                                <C>
         7.14     Modification, Extension, and Renewal of Options............................8
         7.15     Other Provisions...........................................................8

8.       Termination or Amendment of the Plan................................................8

9.       Indemnification.....................................................................8

10.      Effective Date and Term of Plan.....................................................8
</TABLE>

                                      -ii-

<PAGE>   4
                            JAWS TECHNOLOGIES, INC.
                               STOCK OPTION PLAN

        1. PURPOSE. The purpose of this JAWS Technologies, Inc. Stock Option
Plan ("Plan") is to further the growth and development of JAWS Technologies,
Inc. (the "Company") by providing, through ownership of stock of the Company, an
incentive to officers, other key employees and directors who are in a position
to contribute materially to the prosperity of the Company, to increase such
persons' interests in the Company's welfare, to encourage them to continue their
services to the Company or its subsidiaries, and to attract individuals of
outstanding ability to enter the employment of the Company or its subsidiaries,
to remain or become directors of the Company and to provide valuable services to
the Company or its subsidiaries.

        2. INCENTIVE AND NON-QUALIFIED STOCK OPTIONS. Two types of Stock Options
(referred to herein as "Options" without distinction between such two types) may
be granted under the Plan: Options intended to qualify as Incentive Stock
Options under Section 422 of the Code and Non-Qualified Stock Options not
specifically authorized or qualified for favorable income tax treatment by the
Code.

        3. DEFINITIONS. The following definitions are applicable to the Plan:

           3.1 BOARD. The Board of Directors of the Company.

           3.2 CODE. The Internal Revenue Code of 1986, as amended from time to
time.

           3.3 COMMON STOCK. The shares of the $.01 par value per share common
stock of the Company.

           3.4 COMPANY. JAWS Technologies, Inc., a Delaware corporation.

           3.5 DISABLED OR DISABILITY. For the purposes of Section 7.4, a
disability of the type defined in Section 22(e)(3) of the Code. The
determination of whether an individual is Disabled or has a Disability is
determined under procedures established by the Plan Administrator for purposes
of the Plan.

           3.6 FAIR MARKET VALUE. For purposes of the Plan, the "fair market
value" per share of Common Stock of the Company at any date shall be (a) if the
Common Stock is listed on an established stock exchange or exchanges or the
NASDAQ National Market System, the closing price per share on the last trading
day immediately preceding such date on the principal exchange on which it is
traded or as reported by NASDAQ, or (b) if the Common Stock is not then listed
on an exchange or the NASDAQ National Market System, the closing price per share
on the last trading day immediately preceding such date reported by

<PAGE>   5

NASDAQ, or if sales are not reported by NASDAQ, the average of the closing bid
and asked prices per share for the Common Stock in the over-the-counter market
as quoted on NASDAQ on the last trading day immediately preceding such date, or
(c) if the Common Stock is not then listed on an exchange, the NASDAQ National
Market System or quoted on NASDAQ, an amount determined in good faith by the
Plan Administrator.

           3.7 INCENTIVE STOCK OPTION. Any Stock Option intended to be and
designated as an "incentive stock option" within the meaning of Section 422 of
the Code.

           3.8 NON-QUALIFIED STOCK OPTION. Any Stock Option that is not an
Incentive Stock Option.

           3.9 OPTIONEE. The recipient of a Stock Option.

           3.10 PLAN. The JAWS Technologies, Inc. Stock Option Plan, as amended
from time to time.

           3.11 PLAN ADMINISTRATOR. The Board or the Compensation Committee
designated pursuant to Section 4.2 hereof to administer, construe and interpret
the terms of the Plan.

           3.12 STOCK OPTION OR OPTION. Any option to purchase shares of Common
Stock granted pursuant to Section 7 hereof.

        4. ADMINISTRATION.

           4.1 ADMINISTRATION BY BOARD. Subject to Section 4.2 hereof, the Plan
Administrator shall be the Board of Directors of the Company (the "Board")
during such periods of time as all members of the Board are "outside directors"
as defined in Treas. Regs. '1.162-27(e)(3) ("outside directors"). Anything to
the contrary notwithstanding, the requirement that all members of the Board be
outside directors shall not apply for any period of time during which the
Company's Common Stock is not registered pursuant to Section 12 of the
Securities Exchange Act of 1934, as amended. Subject to the provisions of the
Plan, the Plan Administrator shall have authority to construe and interpret the
Plan, to promulgate, amend, and rescind rules and regulations relating to its
administration, from time to time to select from among the eligible employees
and directors (as determined pursuant to Section 5) of the Company and its
subsidiaries those employees and directors to whom Stock Options will be
granted, to determine the timing and manner of the grant of the Options, to
determine the exercise price, the number of shares covered by and all of the
terms of the Stock Options, to determine the duration and purpose of leaves of
absence which may be granted to Stock Option holders without constituting
termination of their employment for purposes of the Plan, and to make all of the
determinations necessary or advisable for administration of the Plan. The
interpretation and construction by the Plan Administrator of any provision of
the Plan, or of any agreement issued and executed under the Plan, shall be final
and binding upon all

                                      -2-
<PAGE>   6

parties. No member of the Board shall be liable for any action or determination
undertaken or made in good faith with respect to the Plan or any agreement
executed pursuant to the Plan.

           4.2 ADMINISTRATION BY COMMITTEE. The Board may, in its sole
discretion, delegate any or all of its duties as Plan Administrator and, subject
to the provisions of Section 4.1 of the Plan, at any time the Board includes any
person who is not an outside director, the Board shall delegate all of its
duties as Plan Administrator during such period of time to a compensation
committee (the "Committee") of not fewer than two (2) members of the Board, all
of the members of which Committee shall be persons who, in the opinion of
counsel to the Company, are outside directors and "non-employee directors"
within the meaning of Rule 16b-3(b)(3)(i) promulgated by the Securities and
Exchange Commission, to be appointed by and serve at the pleasure of the Board.
Anything to the contrary notwithstanding, the requirement that all members of
the Committee be non-employee directors and outside directors shall not apply
for any period of time during which the Company's Common Stock is not registered
pursuant to Section 12 of the Securities Exchange Act of 1934, as amended. Those
provisions of the Plan that make express reference to Rule 16b-3 under the
Securities Exchange Act of 1934, as amended, shall apply only to reporting
persons. From time to time, the Board may increase or decrease (to not less than
two members) the size of the Committee, and add additional members to, or remove
members from, the Committee. The Committee shall act pursuant to a majority
vote, or the written consent of a majority of its members, and minutes shall be
kept of all of its meetings and copies thereof shall be provided to the Board.
Subject to the provisions of the Plan and the directions of the Board, the
Committee may establish and follow such rules and regulations for the conduct of
its business as it may deem advisable. No member of the Committee shall be
liable for any action or determination undertaken or made in good faith with
respect to the Plan or any agreement executed pursuant to the Plan.

        5. ELIGIBILITY. Any employee or director (including any officer or
director who is an employee) of the Company or any of its subsidiaries shall be
eligible to receive Options under the Plan; provided, however, that no person
who owns stock possessing more than 10% of the total combined voting power of
all classes of stock of the Company or any of its parent or subsidiary
corporations shall be eligible to receive an Incentive Stock Option under the
Plan unless at the time such Incentive Stock Option is granted the Option price
(determined in the manner provided in Section 7.2 hereof) is at least 110% of
the Fair Market Value of the shares subject to the Option and such Option by its
terms is not exercisable after the expiration of five years from the date such
Option is granted. An Optionee may receive more than one Option under the Plan.
However, non-employee directors are not eligible to receive an Incentive Stock
Option under the Plan.

        6. SHARES SUBJECT TO OPTIONS. The stock available for grant of Options
under the Plan shall be shares of the Company's authorized but unissued, or
reacquired, Common Stock. The aggregate number of shares which may be issued
pursuant to exercise of Options granted under the Plan, as amended, shall not
exceed 20% of all outstanding common shares (subject to adjustment as provided
in Section 7.13 hereof), including shares previously issued under the Plan. The
maximum number of shares with respect to which options may be

                                      -3-
<PAGE>   7

granted to any employee in any one calendar year shall be 500,000 shares. In the
event that any outstanding Option under the Plan for any reason expires, or is
terminated, the shares of Common Stock allocable to the unexercised portion of
the Option shall again be available for Options under the Plan as if no Option
had been granted with respect to such shares.

        7. TERMS AND CONDITIONS OF OPTIONS. Options granted under the Plan shall
be evidenced by agreements (which need not be identical) in such form and
containing such provisions which are consistent with the Plan as the Plan
Administrator shall from time to time approve. Such agreements may incorporate
all or any of the terms hereof by reference and shall comply with and be subject
to the following terms and conditions:

           7.1 NUMBER OF SHARES SUBJECT TO OPTION. Each Option agreement shall
specify the number of shares subject to the Option.

           7.2 OPTION PRICE. The purchase price for the shares subject to any
Option shall be determined by the Plan Administrator at the time of grant, but
shall not be less than par value per share. Anything to the contrary
notwithstanding, the purchase price for the shares subject to any Incentive
Stock Option shall not be less than 100% of the Fair Market Value of the shares
of Common Stock of the Company on the date the Stock Option is granted. In the
case of an Incentive Stock Option granted to an employee who owns stock
possessing more than 10% of the total combined voting power of all classes of
stock of the Company or any of its parent or subsidiary corporations, the Option
price shall not be less than 110% of the fair market value per share of the
Common Stock of the Company on the date the Option is granted.

           7.3 NOTICE AND PAYMENT. Any exercisable portion of a Stock Option may
be exercised only by:

               (a) delivery of a written notice to the Company, prior to the
time when such Stock Option becomes unexercisable under Section 7.4 hereof,
stating the number of shares being purchased and complying with all applicable
rules established by the Plan Administrator;

               (b) payment in full of the exercise price of such Option by, as
applicable, (i) cash or check for an amount equal to the aggregate Option
exercise price for the number of shares being purchased, (ii) in the discretion
of the Plan Administrator, upon such terms as the Plan Administrator shall
approve, a copy of instructions to a broker directing such broker to sell the
Common Stock for which such Option is exercised, and to remit to the Company the
aggregate exercise price of such Options (a "cashless exercise"), or (iii) in
the discretion of the Plan Administrator, upon such terms as the Plan
Administrator shall approve, the Optionee may pay all or a portion of the
purchase price for the number of shares being purchased by tendering shares of
the Company's Common Stock owned by the Optionee, duly endorsed for transfer to
the Company, with a Fair Market Value on the date of delivery equal to the
aggregate purchase price of the shares with respect to which such Stock Option
or portion is thereby exercised (a "stock-for-stock exercise");

                                      -4-
<PAGE>   8

               (c) payment of the amount of tax required to be withheld (if any)
by the Company or any parent or subsidiary corporation as a result of the
exercise of a Stock Option. At the discretion of the Plan Administrator, upon
such terms as the Plan Administrator shall approve, the Optionee may pay all or
a portion of the tax withholding by (i) cash or check payable to the Company,
(ii) cashless exercise, (iii) stock-for-stock exercise, or (iv) a combination of
one or more of the foregoing payment methods; and

               (d) delivery of a written notice to the Company requesting that
the Company direct the transfer agent to issue to the Optionee (or to his
designee) a certificate for the number of shares of Common Stock for which the
Option was exercised or, in the case of a cashless exercise, for any shares that
were not sold in the cashless exercise.

Notwithstanding the foregoing, the Company may extend and maintain, or arrange
for the extension and maintenance of, credit to any Optionee to finance the
Optionee's purchase of shares pursuant to exercise of any Stock Option, on such
terms as may be approved by the Plan Administrator, subject to applicable
regulations of the Federal Reserve Board and any other laws or regulations in
effect at the time such credit is extended.

           7.4 TERM OF OPTION. No Option shall be exercisable after the
expiration of the earliest of (a) ten years after the date the Option is
granted, (b) three months after the date the Optionee's employment with the
Company and its subsidiaries terminates if such termination is for any reason
other than Disability or death, (c) one year after the date the Optionee's
employment with the Company and its subsidiaries terminates if such termination
is a result of death or Disability; provided, however, that the Option agreement
for any Option may provide for shorter periods in each of the foregoing
instances. In the case of an Incentive Stock Option granted to an employee who
owns stock possessing more than 10% of the total combined voting power of all
classes of stock of the Company or any of its parent or subsidiary corporations,
the term set forth in (a), above, shall not be more than five years after the
date the Option is granted.

           7.5 EXERCISE OF OPTION. No Option shall be exercisable during the
lifetime of an Optionee by any person other than the Optionee. Subject to the
foregoing, the Plan Administrator shall have the power to set the time or times
within which each Option shall be exercisable and to accelerate the time or
times of exercise. Unless otherwise provided by the Plan Administrator, each
Option granted under the Plan shall become exercisable on a cumulative basis as
to one-third (1/3) of the total number of shares covered thereby at any time
after one year from the date the Option is granted and an additional one-third
(1/3) of such total number of shares at any time after the end of each
consecutive one-year period thereafter until the Option has become exercisable
as to all of such total number of shares. To the extent that an Optionee has the
right to exercise an Option and purchase shares pursuant thereto, the Option may
be exercised from time to time by written notice to the Company, stating the
number of shares being purchased and accompanied by payment in full of the
exercise price for such shares.

                                      -5-
<PAGE>   9

           7.6 NO TRANSFER OF OPTION. No Option shall be transferable by an
Optionee otherwise than by will or the laws of descent and distribution.

           7.7 LIMIT ON INCENTIVE STOCK OPTIONS. The aggregate fair market value
(determined at the time the Option is granted) of the stock with respect to
which Incentive Stock Options granted after 1986 are exercisable for the first
time by an Optionee during any calendar year (under all Incentive Stock Option
plans of the Company and its subsidiaries) shall not exceed $100,000. To the
extent that the aggregate Fair Market Value (determined at the time of the Stock
Option is granted) of the Common Stock with respect to which Incentive Stock
Options are exercisable for the first time by an Optionee during any calendar
year (under all Incentive Stock Option plans of the Company and any parent or
subsidiary corporations) exceeds $100,000, such Stock Options shall be treated
as Non-Qualified Stock Options. The determination of which Stock Options shall
be treated as Non-Qualified Stock Options shall be made by taking Stock Options
into account in the order in which they were granted.

           7.8 RESTRICTION ON ISSUANCE OF SHARES. The issuance of Options and
shares shall be subject to compliance with all of the applicable requirements of
law with respect to the issuance and sale of securities, including, without
limitation, any required qualification under the California Corporate Securities
Law of 1968, as amended, or other state securities laws. If an Optionee acquires
shares of Common Stock pursuant to the exercise of an Option at a time when the
shares are not registered pursuant to Section 12 of the Securities Exchange Act
of 1934, as amended, the Plan Administrator, in its sole discretion, may require
as a condition of issuance of shares covered by the Option that the shares of
Common Stock shall be subject to restrictions on transfer. The Company may place
a legend on the certificates evidencing the shares, reflecting the fact that
they are subject to restrictions on transfer pursuant to the terms of this
Section. In addition, the Optionee may be required to execute a shareholders'
agreement in favor of the Company, its designee and/or other shareholders with
respect to all or any of the shares so acquired. In such event, the terms of
such agreement shall apply to such shares.

           7.9 INVESTMENT REPRESENTATION. Each Option shall contain and any
Optionee may be required, as a condition of the grant of the Option and the
issuance of shares covered by his or her Option, to represent that the Option
and the shares to be acquired pursuant to exercise of the Option will be
acquired for investment and without a view to distribution thereof; and in such
case, the Company may place a legend on the certificate evidencing the shares
reflecting the fact that they were acquired for investment and cannot be sold or
transferred unless registered under the Securities Act of 1933, as amended, or
unless counsel for the Company is satisfied that the circumstances of the
proposed transfer do not require such registration.

           7.10 RIGHTS AS A SHAREHOLDER OR EMPLOYEE. An Optionee or transferee
of an Option shall have no right as a shareholder of the Company with respect to
any shares covered by any Option until the date of the issuance of a share
certificate for such shares. No adjustment shall be made for dividends (ordinary
or extraordinary, whether cash,

                                      -6-
<PAGE>   10

securities, or other property) or distributions or other rights for which the
record date is prior to the date such share certificate is issued, except as
provided in Section 7.13. Nothing in the Plan or in any Option agreement shall
confer upon any employee any right to continue in the employ of the Company or
any of its subsidiaries or interfere in any way with any right of the Company or
any subsidiary to terminate the Optionee's employment at any time.

           7.11 NO FRACTIONAL SHARES. In no event shall the Company be required
to issue fractional shares upon the exercise of an Option.

           7.12 EXERCISABILITY IN THE EVENT OF DEATH. In the event of the death
of the Optionee, any Option or unexercised portion thereof granted to the
Optionee, to the extent exercisable by him or her on the date of death, may be
exercised by the Optionee's personal representatives, heirs, or legatees subject
to the provisions of Section 7.4 hereof.

           7.13 RECAPITALIZATION OR REORGANIZATION OF COMPANY. Except as
otherwise provided herein, appropriate and proportionate adjustments shall be
made in the number and class of shares subject to the Plan, to the Option rights
granted under the Plan, including the any formula grants or automatic grant
authorizations, and the exercise price of such Option rights, in the event that
the number of shares of Common Stock of the Company are increased or decreased
as a result of a stock dividend (but only on Common Stock), stock split, reverse
stock split, recapitalization, reorganization, merger, consolidation,
separation, or like change in the corporate or capital structure of the Company.
In the event there shall be any other change in the number or kind of the
outstanding shares of Common Stock of the Company, or any stock or other
securities into which such common stock shall have been changed, or for which it
shall have been exchanged, whether by reason of a complete liquidation of the
Company or a merger, reorganization, or consolidation of the Company with any
other corporation in which the Company is not the surviving corporation or the
Company becomes a wholly-owned subsidiary of another corporation, then if the
Plan Administrator shall, in its sole discretion, determine that such change
equitably requires an adjustment to shares of Common Stock currently subject to
Options under the Plan, or to prices or terms of outstanding Options, such
adjustment shall be made in accordance with such determination.

           To the extent that the foregoing adjustments relate to stock or
securities of the Company, such adjustments shall be made by the Plan
Administrator, the determination of which in that respect shall be final,
binding, and conclusive. No right to purchase fractional shares shall result
from any adjustment of Options pursuant to this Section. In case of any such
adjustment, the shares subject to the option shall be rounded down to the
nearest whole share. Notice of any adjustment shall be given by the Company to
each Optionee whose Options shall have been so adjusted and such adjustment
(whether or not notice is given) shall be effective and binding for all purposes
of the Plan.

           In the event of a complete liquidation of the Company or a merger,
reorganization, or consolidation of the Company with any other corporation in
which the Company is not the surviving corporation or the Company becomes a
wholly-owned subsidiary of another corporation, any unexercised Options
theretofore granted under the Plan

                                      -7-
<PAGE>   11

shall be deemed cancelled unless the surviving corporation in any such merger,
reorganization, or consolidation elects to assume the Options under the Plan or
to issue substitute Options in place thereof; provided, however, that,
notwithstanding the foregoing, if such Options would be cancelled in accordance
with the foregoing, the Optionee shall have the right, exercisable during a
ten-day period ending on the fifth day prior to such liquidation, merger, or
consolidation, to exercise such Option in whole or in part without regard to any
installment exercise provisions in the Option agreement.

           7.14 MODIFICATION, EXTENSION, AND RENEWAL OF OPTIONS. Subject to the
terms and conditions and within the limitations of the Plan, the Plan
Administrator may modify, extend, or renew outstanding Options granted under the
Plan, and accept the surrender of outstanding Options (to the extent not
theretofore exercised). The Plan Administrator shall not, however, modify any
outstanding Incentive Stock Option in any manner which would cause the Option
not to qualify as an Incentive Stock Option within the meaning of Section 422 of
the Code. Notwithstanding the foregoing, no modification of an Option shall,
without the consent of the Optionee, alter or impair any rights of the Optionee
under the Option. However, a termination of the Option in which the Optionee
receives a cash payment equal to the difference between the Fair Market Value
and the exercise price for all shares subject to exercise under any outstanding
Option shall not alter or impair any rights of the Optionee.

           7.15 OTHER PROVISIONS. Each Option may contain such other terms,
provisions, and conditions not inconsistent with the Plan as may be determined
by the Plan Administrator.

        8. TERMINATION OR AMENDMENT OF THE PLAN. The Board may at any time
terminate or amend the Plan; provided that, without approval of the holders of a
majority of the shares of Common Stock of the Company represented and voting at
a duly held meeting at which a quorum is present (which shares voting
affirmatively also constitute a majority of the required quorum) or by the
written consent of a majority of the outstanding shares of Common Stock, there
shall be, except by operation of the provisions of Section 7.13, no increase in
the total number of shares covered by the Plan, no change in the class of
persons eligible to receive Options granted under the Plan, and no extension of
the term of the Plan beyond ten (10) years after the earlier of the date the
Plan is adopted or the date the Plan is approved by the Company's shareholders;
and provided further that, without the consent of the Optionee or as provided by
Section 7.14 hereof, no amendment may adversely affect any then outstanding
Option or any unexercised portion thereof.

        9. INDEMNIFICATION. To the extent permitted by law, the Certificate of
Incorporation of the Company, the Bylaws of the Company and any indemnity
agreements between the Company and its directors or employees, the Company shall
indemnify each member of the Board and of the Plan Administrator, and any other
employee of the Company with duties under the Plan, against expenses (including
any amount paid in settlement) reasonably incurred by him in connection with any
claims against him by reason of his conduct in the performance of his duties
under the Plan.

                                      -8-
<PAGE>   12

        10. EFFECTIVE DATE AND TERM OF PLAN. This Plan shall become effective
(the "Effective Date") on July 1, 1998. No options granted under the Plan will
be effective unless the Plan is approved by shareholders of the Company within
12 months of the date of adoption. Unless sooner terminated by the Board in its
sole discretion, the Plan will expire on June 30, 2008.

Dated:  _________, 1998

                                        JAWS TECHNOLOGIES, INC.

                                        By:___________________________________
                                            Robert Kubbernus, President

                                      -9-

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