Document:

Exhibit 4(A)

	

Exhibit 4(a)

Common Stock Rights Agreement

Dated as of August 9, 2000

between

The Middleby
Corporation

and

The
Northwestern Mutual Life Insurance Company,

as Investor

	

Table of Contents

	Section	Heading	Page
	Parties	 	 	 	0	 
	Recitals	 	 	 	0	 
	Section 1.	 	Definitions	 	1	 
	Section 2.	 	Change of Control Payment	 	3	 
	Section 3.	 	Financial and Business Information	 	3	 
	Section 4.	 	No Impairment or Amendment	 	3	 
	Section 5.	 	Interest; Indemnification	 	4	 
	Section 6.	 	Tax and Accounting Treatment	 	4	 
	Section 7.	 	Exchange of Notes and Warrant	 	4	 
	Section 8.	 	Termination	 	5	 
	Section 9.	 	Parties	 	5	 
	Section 10.	 	Severability	 	5	 
	Section 11.	 	Governing Law	 	5	 
	Section 12.	 	Section Headings	 	5	 
	Section 13.	 	Notices	 	5	 
	Section 14.	 	Entire Agreement	 	6	 
	Section 15.	 	Representations and Warranties	 	6	 
	Signature	 	 	 	9	 

	

Common Stock
Rights Agreement

     This
Common Stock Rights Agreement is dated as of August 9, 2000 (this
“Agreement”), and is between The Middleby Corporation, a
Delaware corporation (the “Company”), and The Northwestern
Mutual Life Insurance Company (together with and including any Affiliate to whom
the foregoing may transfer all or any part of its right, title and interest
hereunder, being referred to as the “Investor”). 

Recitals:

     Whereas,
Middleby Marshall Inc., a Delaware Corporation (“Middleby
Marshall”) and Middleby Worldwide, Inc., a Florida corporation,
formerly known as Asbury Associates, Inc. (“Middleby
Worldwide,” Middleby Worldwide and Middleby Marshall being herein
collectively referred to as the “Obligors”), and the Investor
are parties to that certain Note Agreement dated as of January 1, 1995 (as
the same was thereafter amended, modified or supplemented from time to time, the
“Note Agreement”) pursuant to which the Investor agreed, upon
the terms and conditions set forth in the Note Agreement, to purchase
(a) the 10.99% Senior Secured Notes due January 10, 2003 of the
Obligors in an aggregate principal amount not exceeding $15,000,000 (the
“Notes”) and (b) the Warrant to purchase 250,000 shares of
the Common Stock of the Company (the “Warrant”); 

     Whereas,
the Obligors wish to prepay the Notes in full and are permitted to do so
pursuant to Section 2.2 of the Note Agreement, provided that the Obligors
pay interest accrued to the date of prepayment and a premium equal to the
Make-Whole Amount, provided, further, that the Obligors wish to
prepay the Notes together with interest accrued thereon, but without premium,
except as provided below; 

     Whereas,
the Company wishes to redeem the Warrant and shall remit to the Investor an
amount equal to $1,300,000, such amount to constitute satisfaction of the
premium due pursuant to Section 2.2 of the Note Agreement and the redemption
price of the Warrant; 

     Whereas,
the Company will derive substantial direct and indirect benefit from the waiver
as provided in Section 7 hereof by the Investor of its right to receive the
Make-Whole Amount pursuant to said Section 2.2 in connection with the
prepayment in full of the Notes by the Obligors and as an inducement to the
Investor to waive such right the Company has agreed to execute and deliver this
Agreement to the Investor; 

	

     Whereas,
capitalized terms used herein shall have the respective meanings assigned
thereto in the Note Agreement, unless defined in Section 1 of this Agreement or
the context shall otherwise require; 

     Now,
Therefore, in consideration of the premises and for other good and valuable
consideration, the receipt and sufficiency of which is hereby acknowledged, the
parties hereto agree as follows: 

     Section
1. Definitions. When used herein, the following terms shall have the following meanings: 

	 	
     “Acquiring
Person” shall mean a “person” or “group of
persons” within the meaning of Sections 13(d) and 14(d) of the
Securities Exchange Act of 1934, as amended, provided that
notwithstanding the foregoing, “Acquiring Person” shall not be
deemed to include (a) the Investor or any group of Persons of which the
Investor is a member or (b) any member of the Middleby Control Group unless
such member has, directly or indirectly, disposed of, sold or otherwise
transferred to, or encumbered or restricted (whether by means of voting trust
agreement or otherwise) for the benefit of, an Acquiring Person all or any
portion of the Voting Stock of the Company directly or indirectly owned or
controlled by such member or such member directly or indirectly votes all or any
portion of the Voting Stock of the Company directly or indirectly owned or
controlled by such member for the taking of any action which, directly or
indirectly, constitutes or would result in a Change of Control, in which event
such member of the Middleby Control Group shall be deemed to constitute an
Acquiring Person to the extent of the Voting Stock of the Company owned or
controlled by such member.

	 	
     “Change
of Control” shall mean the earliest to occur of: (1) the date the
Company enters into a binding written agreement with an Acquiring Person to
permit such Acquiring Person to acquire, directly or indirectly, beneficial
ownership of more than the percentage of the total Voting Stock of the Company
then owned or controlled by the Middleby Control Group, or (2) the date a tender
offer or exchange offer is made or accepted by any of the shareholders of the
Company which would result in an Acquiring Person, directly or indirectly,
beneficially owning more than the percentage of the total Voting Stock of the
Company then owned or controlled by the Middleby Control Group, if such purchase
or redemption of the Voting Stock of the Company pursuant to such tender offer or
exchange offer, as the case may be, is 

	 	
consummated prior to the close of business (CST)
on May 9, 2001, or (3) the date an Acquiring Person becomes, directly or indirectly,
the beneficial owner of more than the percentage of the total Voting Stock of the Company
then owned or controlled by the Middleby Control Group, or (4) the date of a merger
between the Company and any other Person, a consolidation of the Company with any other
Person or an acquisition of any other Person by the Company, if immediately after such
event, an Acquiring Person shall hold more than the percentage of the total Voting Stock
of the Company owned or controlled by the Middleby Control Group immediately after giving
effect to such merger, consolidation or acquisition, or, if the Company shall not be the
surviving entity, of the surviving, resulting or continuing corporation, or (5) the date
of the sale of all or substantially all of the assets of the Company, or (6) the date the
Company ceases to own and control, free and clear of all Liens, at least 95% of the
outstanding shares of Voting Stock of Middleby Marshall or to have the power to direct or
cause the direction of the management or policies of Middleby Marshall, or (7) the
date a majority of the Board of Directors of the Company shall cease for any reason to
consist of (i) individuals who on the date of this Agreement were serving as
directors of the Company and (ii) individuals who subsequently become members of the
Board of Directors of the Company if such individuals’nomination for election or
election to the Board of Directors of the Company is recommended or approved by a
majority of the Board of Directors or stockholders of the Company, or (8) the
Company after the date of this Agreement directly or indirectly redeems or offers in
writing to redeem shares of Voting Stock of the Company and the number of shares (other
than the underlying shares of Voting Stock relating to the Warrant) so redeemed or
subject to such written offer of redemption equals or exceeds 1,250,000 shares of Voting
Stock of the Company.

	 	
     “Middleby
Control Group” shall mean William F. Whitman, Jr. and
David P. Riley, their respective spouses and lineal descendants, and trusts
established for estate planning purposes for the exclusive benefit of any of the
foregoing.

	 	
     “Overdue Rate” shall mean the lesser of (a) the maximum interest rate
permitted by law and (b) 12.99% per annum.

	 	
     “Person”
shall mean an individual, partnership, limited liability company, corporation,
trust or unincorporated organization, and a government or agency or political
subdivision thereof.

	 	
     “Security”
shall have the same meaning as in Section 2(1) of the Securities Act of 1933, as amended.

	 	
     “Voting
Stock” shall mean Securities of any class or classes, the holders of
which are ordinarily, in the absence of contingencies, entitled to elect a
majority of the corporate directors (or Persons performing similar functions).

	 	
     “Voting
Stock Premium Amount” shall mean the amount payable by the Company
pursuant to Section 2 hereof.

	 	
     “Voting
Stock Purchase Price” shall mean the average purchase price per share
of Voting Stock of the Company purchased or otherwise acquired in connection
with a Change of Control.

	

     Section
2. Change of Control Payment. The Company absolutely and unconditionally agrees that if a
Change of Control shall for any reason whatsoever occur within one hundred eighty (180)
days following the date of this Agreement, then, and in such event, the Company agrees
within five (5) Business Days following the date of such Change of Control to notify the
Investor of such fact in the manner provided in Section 13 hereof and concurrently
therewith pay to the Investor, as the benefit of the bargain negotiated for pursuant to
the Warrant, an amount which at the time of payment shall be legal tender for the payment
of public and private debts equal to an amount calculated on a per share basis equal to
the product derived by multiplying the amount by which the Voting Stock Purchase Price
exceeds $8.00 times 250,000. In the event of a stock dividend, subdivision, combination,
issuance of additional capital stock or Securities convertible into capital stock or any
other like event involving the capital stock of the Company, then and in such event the
formula for calculating the change of control payment pursuant to this Agreement shall be
adjusted in accordance with customary financial practice to preserve the overall economic
effect hereunder for the Investor. 

     Section
3. Financial and Business Information. The Company shall cause the Obligors to continue
to deliver to the Investor all information, reports and other financial data which would
have been deliverable under clauses (a), (b) and (d) of Section 5.23 of the Note
Agreement at the times when such items would have been deliverable had the Note Agreement
remained in effect following the date hereof until this Agreement terminates in
accordance with Section 8 hereof. 

     Section
4. No Impairment or Amendment. The Company shall not by any action, including, without
limitation, any reorganization, transfer of assets, consolidation, merger, dissolution,
issuance or sale of Securities or any other voluntary action, avoid or seek to avoid the observance or performance of any of
the  

	

terms of this Agreement, but will at all times in good faith assist in the carrying
out of all such terms and in the taking of all such action as may be necessary or
appropriate to protect the rights of the Investor against impairment. Without limiting
the generality of the foregoing, the Company will use its reasonable best efforts to
obtain all such authorizations, exemptions or consents from any public regulatory body
having jurisdiction thereof as may be necessary to enable the Company to perform its
obligations under this Agreement. 

     Section
5. Interest; Indemnification. The Company agrees to indemnify, save and hold harmless the
Investor from and against any and all liability, loss, cost, damage, reasonable
attorneys’ and accountants’ fees and expenses, court costs and all other out-of-pocket
expenses incurred in connection with or arising from a default hereunder or otherwise in
connection with the Investor’s enforcing its rights under this Agreement. If the Company
fails to pay when due and required to be paid hereunder any amounts payable under this
Agreement, the Company shall pay to the Investor interest at the Overdue Rate after the
occurrence and during the continuance of an event of default as applicable to such unpaid
amounts for the period from the date when such amounts became due until paid in full. 

     Section
6. Tax and Accounting Treatment. Within ninety (90) days following the date of this
Agreement, the Company shall provide to the Investor a detailed written summary, in
detail satisfactory to the Investor, describing the manner in which the Company plans to
allocate, for tax and accounting purposes, the payment of $1,300,000 made pursuant to
Section 7 hereof. The Company agrees to allocate such payment for all purposes, including
the preparation of tax returns and the Company’s financial statements, in the manner set
forth in said summary. 

     Section
7. Exchange of Notes and Warrant. (a) On the date of this Agreement the Company shall
(i) pay to the Investor (A) an amount equal to the outstanding principal amount of the
Notes, together with accrued interest thereon to the date hereof, and (B) $1,300,000 in
satisfaction of the premium due pursuant to Section 2.2 of the Note Agreement and the
redemption price of the Warrant and (ii) agree to be bound by the terms and provisions
set forth herein. 

     (b)
The Investor shall accept the payment and agreements described in
subsection (a) in full satisfaction of the Notes and in exchange for the
Warrant and shall promptly return to the Company the Notes and the Warrant
originally issued to and held by such Investor. 

	

     Section
8. Termination. Subject to compliance in full by the Company with the terms of this
Agreement, this Agreement shall terminate upon the earlier of the indefeasible payment in
full in cash of the Voting Stock Premium Amount and the close of business (CST) on
February 9, 2001. 

     Section
9. Parties. Whenever in this Agreement reference is made to any of the parties hereto,
such reference shall be deemed to include, wherever applicable, a reference to the
successors and assigns of the Company and the Investor. This Agreement shall be binding
upon, and shall inure to the benefit of, the Company and the Investor and their
respective successors and assigns. No assignment by the Company of any of its obligations
hereunder shall relieve the Company of such obligations except to the extent actually
performed by such assignee and no acceptance of any performance by any such assignee
shall act as a waiver, notation or other release by the Investor of its rights hereunder
against the Company with respect to any unperformed obligations of the Company hereunder. 

     Section
10. Severability. Should any part of this Agreement for any reason be declared invalid or
unenforceable, such decision shall not affect the validity or enforceability of any
remaining portion, which remaining portion shall remain in force and effect as if this
Agreement had been executed with the invalid or unenforceable portion thereof eliminated
and it is hereby declared the intention of the parties hereto that they would have
executed the remaining portion of this Agreement without including therein any such part,
parts or portion which may, for any reason, be hereafter declared invalid or
unenforceable. 

     Section
11. Governing Law. This Agreement shall be governed by and construed in accordance with
Illinois law, including all matters of construction, validity and performance. 

     Section
12. Section Headings. The section headings contained in this Agreement shall be without
substantive meaning or content of any kind whatsoever and are not a part of the agreement
between the parties.

     Section
13. Notices. Unless otherwise specifically provided herein, any notice or other
communication required or permitted to be given shall be in writing addressed to the
respective party as set forth below and delivered or mailed prepaid by registered or
certified mail, or overnight air courier, or by facsimile communication. 

	

     Notices
shall be addressed as follows: 

		(a) 		If
to the Investor, at:

	 	720
East Wisconsin Avenue
Milwaukee, Wisconsin 53202
Attention: Securities Department
Telecopier
No.: (414) 299-7124 

		(b) 		If
to the Company at:

	  	1400
Toastmaster Drive
Elgin, Illinois 60120
Attention: Vice President and Chief Financial
Officer

	

or to such other address as
the party addressed shall have previously designated in written notice to the
serving party, given in accordance with this Section 13. A notice not given
as provided above shall, if it is in writing, be deemed given if and when
actually received by the party to whom given. 

     Section
14. Entire Agreement. This Agreement constitutes the entire agreement of the parties with
respect to the subject matter hereof and supersedes all other understandings, oral or
written, with respect to the subject matter hereof. 

     Section
15. Representations and Warranties. The Company hereby represents and warrants to the
Investor that: 

		(a) 		The Company,

	 	     (i)
is a corporation duly organized, validly existing and in good standing under the laws of
the State of Delaware; and

	 	     (ii)
has all requisite power and authority and all necessary licenses and permits to own and
operate its properties and to carry on its business as now conducted and as presently
proposed to be conducted.

	 	
     (b)(i)
The Company is solvent, has capital not unreasonably small in relation to its
business or any contemplated or undertaken transaction and has assets having a
value both at fair valuation and a present fair salable value greater than the
amount required to pay its debts as they become due and greater than the amount
that will be required to pay its probable liability on its existing debts as
they become due and matured. The Company does not intend to incur, nor does it
believe, nor should it have believed that it will incur, debts beyond its
ability to pay such debts as they become due. The Company will not be rendered
insolvent by the execution, delivery and performance by the Company of its
obligations under or in respect of this Agreement. The Company doesn’t
intend to hinder, delay or defraud its creditors by or through the execution,
delivery or performance by the Company of its obligations under or in respect of
this Agreement.

	 	
(ii)
There will be provided to the Company and the Obligors and their respective
affiliates a substantial economic benefit and adequate consideration for the
execution and delivery of this Agreement and therefore will enhance the
financial position of each such Person.

	 	
(c)
There are no proceedings pending or, to the knowledge of the Company, threatened
against or affecting the Company in any court or before any governmental
authority or arbitration board or tribunal which involve the possibility of
materially and adversely affecting the properties, business, prospects, profits
or condition (financial or otherwise) of the Company or the ability of the
Company to perform its respective obligations under this Agreement.

	 	
(d)
Compliance by the Company with all of the provisions of this Agreement

	 	     (i)
are within the corporate powers of the Company;

	 	     (ii)
will not violate any provisions of any law or any order of any court or governmental
authority or agency and will not conflict with or result in any breach of any of the
terms, conditions or provisions of, or constitute a default under, the Certificate of
Incorporation or By-laws of the Company or any indenture or other agreement or instrument
to which the Company is a party or by which it may be bound or result in the imposition
of any Liens or encumbrances on any property of the Company; and

	 	     (iii)
has been duly authorized by proper corporate action on the part of the Company (no action
by the stockholders of the Company being required by law, by the Certificate of
Incorporation or By-laws of the Company or otherwise), executed and delivered by the
Company and this Agreement constitutes the legal, valid and binding obligation, contract
and agreement of the Company enforceable in accordance with its terms.

	 	
     (e) The Company is not in default in the payment of principal or interest on any
Debt for borrowed money or is in default under any instrument or instruments or
agreements under and subject to which any Indebtedness has been issued and no
event has occurred and is continuing under the provisions of any such instrument
or agreement which with the lapse of time or the giving of notice, or both,
would constitute an event of default thereunder.

	 	
     (f) No approval, consent or withholding of objection on the part of any regulatory
body, state, Federal or local, is necessary in connection with the execution and
delivery by the Company of this Agreement or compliance by the Company with any
of the provisions of this Agreement.

	

     In
Witness Whereof, this Agreement has been duly executed as of the day and year
first above written. 

	 	 	Signature

The Middleby Corporation, a Delaware
Corporation

By: 
——————————————

—————————————— Its

	Accepted as of August ____, 2000.	 	Middleby Marshall, Inc., a Delaware Corporation

By: /s/ 
——————————————

—————————————— Its

Middleby Worldwide, Inc., a Florida Corporation

By: /s/ 
——————————————

—————————————— Its

	Accepted as of August ___, 2000.	 	The Northwestern Mutual Life Insurance Company

By: /s/ 
——————————————

—————————————— Its<PAGE>   1
                             JUNIPER NETWORKS, INC.

                       2000 NONSTATUTORY STOCK OPTION PLAN

     1.   Purposes of the Plan. The purposes of this Stock Plan are to attract
and retain the best available personnel for positions of substantial
responsibility, to provide additional incentive to Employees and Consultants of
the Company and its Subsidiaries and to promote the success of the Company's
business. All options granted under the Plan shall be Nonstatutory Stock
Options. No options under this Stock Plan shall be granted to Officers or
Directors.

     2.   Definitions. As used herein, the following definitions shall apply:

          (a)  "Administrator" means the Board or any of its Committees
appointed pursuant to Section 4 of the Plan.

          (b)  "Applicable Laws" means the legal requirements relating to the
administration of stock option plans under U.S. state corporate laws, U.S.
federal and state securities laws, the Code and the applicable laws of any
foreign country or jurisdiction where Options or Stock Purchase Rights are, or
will be, granted under the Plan.

          (c)  "Board" means the Board of Directors of the Company.

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

          (e)  "Committee" means a Committee appointed by the Board of Directors
in accordance with Section 4 of the Plan.

          (f)  "Common Stock" means the Common Stock of the Company.

          (g)  "Company" means Juniper Networks, Inc., a Delaware corporation.

          (h)  "Consultant" means any person who is engaged by the Company or
any Parent or Subsidiary to render consulting or advisory services to such
entities.

          (i)  "Continuous Status as an Employee or Consultant" means that the
employment or consulting relationship with the Company, any Parent or Subsidiary
is not interrupted or terminated. Continuous Status as an Employee or Consultant
shall not be considered interrupted in the case of (i) any leave of absence
approved by the Company (provided, however, that the Administrator shall be
permitted to stop vesting on any leave of absence, on an individual, aggregate
or policy basis, even if such leave of absence is approved by the Company) or
(ii) transfers between locations of the Company or between the Company, its
Parent, any Subsidiary, or any successor. A leave of absence approved by the
Company shall include sick leave, military leave, or any other personal leave
approved by an authorized representative of the Company.

          (j)  "Director" means a member of the Board of Directors of the
Company.
<PAGE>   2

          (k)  "Employee" means any person, excluding Officers and Directors,
employed by the Company or any Parent or Subsidiary of the Company.

          (l)  "Exchange Act" means the Securities Exchange Act of 1934, as
amended.

          (m)  "Fair Market Value" means, as of any date, the value of Common
Stock determined as follows:

               (i)  If the Common Stock is listed on any established stock
exchange or a national market system, including without limitation the Nasdaq
National Market or The Nasdaq SmallCap Market of The Nasdaq Stock Market, its
Fair Market Value shall be the closing sales price for such stock (or the
closing bid, if no sales were reported) as quoted on such exchange or system for
the last market trading day prior to the time of determination, as reported in
The Wall Street Journal or such other source as the Administrator deems
reliable;

               (ii) If the Common Stock is regularly quoted by a recognized
securities dealer but selling prices are not reported, its Fair Market Value
shall be the mean between the high bid and low asked prices for the Common Stock
on the last market trading day prior to the day of determination; or

               (iii) In the absence of an established market for the Common
Stock, the Fair Market Value thereof shall be determined in good faith by the
Administrator.

          (n)  "Nonstatutory Stock Option" means an Option not intended to
qualify as an incentive stock option within the meaning of Section 422 of the
Code.

          (o)  "Officer" means a person who is an officer of the Company within
the meaning of Section 16 of the Exchange Act and the rules and regulations
promulgated thereunder.

          (p)  "Option" means a stock option granted pursuant to the Plan.

          (q)  "Optioned Stock" means the Common Stock subject to an Option.

          (r)  "Optionee" means an Employee or Consultant who receives an
Option.

          (s)  "Parent" means a "parent corporation," whether now or hereafter
existing, as defined in Section 424(e) of the Code.

          (t)  "Plan" means this 2000 Nonstatutory Stock Option Plan.

          (u)  "Section 16(b)" means Section 16(b) of the Securities Exchange
Act of 1934, as amended.

          (v)  "Share" means a share of the Common Stock, as adjusted in
accordance with Section 11 below.

                                      -2-
<PAGE>   3

          (w)  "Subsidiary" means a "subsidiary corporation," whether now or
hereafter existing, as defined in Section 424(f) of the Code.

     3.   Stock Subject to the Plan. Subject to the provisions of Section 11 of
the Plan, the maximum aggregate number of Shares which may be subject to option
and sold under the Plan is 12,000,000 Shares, plus an annual increase to be
added on the first day of the Company's fiscal year equal to the greater of (i)
5,000,000 shares, (ii) 5% of the outstanding shares on such date or (iii) a
lesser amount determined by the Board. The Shares may be authorized but
unissued, or reacquired Common Stock.

     If an Option expires or becomes unexercisable without having been exercised
in full, or is surrendered pursuant to an option exchange program, the
unpurchased Shares which were subject thereto shall become available for future
grant under the Plan (unless the Plan has terminated). However, Shares that have
actually been issued under the Plan upon exercise of an Option shall not be
returned to the Plan and shall not become available for future distribution
under the Plan

     4.   Administration of the Plan.

          (a)  Procedure.

               (i)  Multiple Administrative Bodies. The Plan may be administered
by different Committees with respect to different groups of Service Providers.

               (ii) Other Administration. Other than as provided above, the Plan
shall be administered by (A) the Board or (B) a Committee, which committee shall
be constituted to satisfy Applicable Laws.

          (b)  Powers of the Administrator. Subject to the provisions of the
Plan and, in the case of a Committee, the specific duties delegated by the Board
to such Committee, and subject to the approval of any relevant authorities,
including the approval, if required, of any stock exchange upon which the Common
Stock is listed, the Administrator shall have the authority in its discretion:

               (i)  to determine the Fair Market Value of the Common Stock, in
accordance with Section 2(m) of the Plan;

               (ii) to select the Consultants and Employees to whom Options may
from time to time be granted hereunder;

               (iii) to determine whether and to what extent Options are granted
hereunder;

               (iv) to determine the number of Shares to be covered by each such
Option granted hereunder;

                                      -3-
<PAGE>   4

               (v)  to approve forms of agreement for use under the Plan;

               (vi) to determine the terms and conditions of any Option granted
                    hereunder;

               (vii) to determine whether and under what circumstances an Option
may be settled in cash under subsection 9(f) instead of Common Stock;

               (viii) to reduce the exercise price of any Option to the then
current Fair Market Value if the Fair Market Value of the Common Stock covered
by such Option has declined since the date the Option was granted; and

               (ix) to construe and interpret the terms of the Plan and Options
granted pursuant to the Plan.

          (c)  Effect of Administrator's Decision. All decisions, determinations
and interpretations of the Administrator shall be final and binding on all
Optionees and any other holders of any Options.

     5.   Eligibility.

          (a)  Nonstatutory Stock Options may be granted to Employees and
Consultants. An Employee or Consultant who has been granted an Option may, if
otherwise eligible, be granted additional Options.

          (b)  Neither the Plan nor any Option shall confer upon any Optionee
any right with respect to continuation of his or her employment or consulting
relationship with the Company, nor shall it interfere in any way with his or her
right or the Company's right to terminate his or her employment or consulting
relationship at any time, with or without cause.

          (c)  The following limitations shall apply to grants of Options to
Employees:

               (i)  No Employee shall be granted, in any fiscal year of the
Company, Options to purchase more than 3,000,000 Shares.

               (ii) In connection with his or her initial employment, an
Employee may be granted Options to purchase up to an additional 6,000,000 Shares
which shall not count against the limit set forth in subsection (i) above.

               (iii) The foregoing limitations shall be adjusted proportionately
in connection with any change in the Company's capitalization as described in
Section 11.

               (iv) If an Option is cancelled in the same fiscal year of the
Company in which it was granted (other than in connection with a transaction
described in Section 11), the cancelled Option shall be counted against the
limit set forth in subsection (i) above. For this purpose, if the exercise price

                                      -4-
<PAGE>   5

of an Option is reduced, such reduction will be treated as a cancellation of the
Option and the grant of a new Option.

     6.   Term of Plan. The Plan shall become effective upon its adoption by the
Board of Directors. It shall continue in effect for a term of ten (10) years
unless sooner terminated under Section 14 of the Plan.

     7.   Term of Option. The term of each Option shall be the term stated in
the Option Agreement; provided, however, that the term shall be no more than ten
(10) years from the date of grant thereof.

     8.   Option Exercise Price and Consideration.

          (a)  The per share exercise price for the Shares to be issued upon
exercise of an Option shall be such price as is determined by the Administrator.

          (b)  The consideration to be paid for the Shares to be issued upon
exercise of an Option, including the method of payment, shall be determined by
the Administrator. Such consideration may consist of (1) cash, (2) check, (3)
promissory note, (4) other Shares which (x) in the case of Shares acquired upon
exercise of an Option, have been owned by the Optionee for more than six months
on the date of surrender, and (y) have a Fair Market Value on the date of
surrender equal to the aggregate exercise price of the Shares as to which such
Option shall be exercised, (5) delivery of a properly executed exercise notice
together with such other documentation as the Administrator and a broker, if
applicable, shall require to effect an exercise of the Option and delivery to
the Company of the sale or loan proceeds required to pay the exercise price, (6)
any other consideration permitted by applicable law, or (7) any combination of
the foregoing methods of payment. In making its determination as to the type of
consideration to accept, the Administrator shall consider if acceptance of such
consideration may be reasonably expected to benefit the Company.

     9.   Exercise of Option.

          (a)  Procedure for Exercise; Rights as a Stockholder. Any Option
granted hereunder shall be exercisable at such times and under such conditions
as determined by the Administrator, and as shall be permissible under the terms
of the Plan.

               An Option may not be exercised for a fraction of a Share.

               An Option shall be deemed to be exercised when written notice of
such exercise has been given to the Company in accordance with the terms of the
Option by the person entitled to exercise the Option and full payment for the
Shares with respect to which the Option is exercised has been received by the
Company. Full payment may, as authorized by the Administrator, consist of any
consideration and method of payment allowable under Section 8(b) hereof. Until
the issuance (as evidenced by the appropriate entry on the books of the Company
or of a duly authorized transfer agent of

                                      -5-
<PAGE>   6

the Company) of the stock certificate evidencing such Shares, no right to vote,
receive dividends or any other rights as a stockholder shall exist with respect
to the Optioned Stock, notwithstanding the exercise of the Option. The Company
shall issue (or cause to be issued) such stock certificate promptly upon
exercise of the Option. No adjustment shall be made for a dividend or other
right for which the record date is prior to the date the stock certificate is
issued, except as provided in Section 11 hereof.

               Exercise of an Option in any manner shall result in a decrease in
the number of Shares which thereafter may be available, both for purposes of the
Plan and for sale under the Option, by the number of Shares as to which the
Option is exercised.

          (b)  Termination of Employment or Consulting Relationship. In the
event of termination of an Optionee's Continuous Status as an Employee or
Consultant (but not in the event of an Optionee's change of status from Employee
to Consultant, such Optionee may, but only within such period of time as is
determined by the Administrator (and in no event later than the expiration date
of the term of such Option as set forth in the Option Agreement), exercise his
or her Option to the extent that the Optionee was entitled to exercise it at the
date of such termination. To the extent that the Optionee was not entitled to
exercise the Option at the date of such termination, or if the Optionee does not
exercise such Option to the extent so entitled within the time specified herein,
the Option shall terminate.

          (c)  Disability of Optionee. In the event of termination of an
Optionee's Continuous Status as an Employee or Consultant as a result of his or
her disability, the Optionee may, but only within ninety (90) days from the date
of such termination (and in no event later than the expiration date of the term
of such Option as set forth in the Option Agreement), exercise the Option to the
extent otherwise entitled to exercise it at the date of such termination. To the
extent that the Optionee was not entitled to exercise the Option at the date of
termination, or if the Optionee does not exercise such Option to the extent so
entitled within the time specified herein, the Option shall terminate, and the
Shares covered by such Option shall revert to the Plan.

          (d)  Death of Optionee. In the event of the death of an Optionee, the
Option may be exercised at any time within ninety (90) days following the date
of death (but in no event later than the expiration of the term of such Option
as set forth in the Notice of Grant) by the Optionee's estate or by a person who
acquired the right to exercise the Option by bequest or inheritance, but only to
the extent that the Optionee was entitled to exercise the Option on the date of
death. If, at the time of death, the Optionee was not entitled to exercise his
or her entire Option, the Shares covered by the unexercisable portion of the
Option shall immediately revert to the Plan. If, after the Optionee's death, the
Optionee's estate or a person who acquires the right to exercise the Option by
bequest or inheritance does not exercise the Option within the time specified
herein, the Option shall terminate, and the Shares covered by such Option shall
revert to the Plan.

          (e)  Buyout Provisions. The Administrator may at any time offer to buy
out for a payment in cash or Shares, an Option previously granted, based on such
terms and conditions as the Administrator shall establish and communicate to the
Optionee at the time that such offer is made.

                                      -6-
<PAGE>   7

     10.  Non-Transferability of Options. Options may not be sold, pledged,
assigned, hypothecated, transferred, or disposed of in any manner other than by
will or by the laws of descent or distribution and may be exercised, during the
lifetime of the Optionee, only by the Optionee.

     11.  Adjustments Upon Changes in Capitalization or Merger.

          (a)  Changes in Capitalization. Subject to any required action by the
stockholders of the Company, the number of shares of Common Stock covered by
each outstanding Option, and the number of shares of Common Stock which have
been authorized for issuance under the Plan but as to which no Options have yet
been granted or which have been returned to the Plan upon cancellation or
expiration of an Option, as well as the price per share of Common Stock covered
by each such outstanding Option, shall be proportionately adjusted for any
increase or decrease in the number of issued shares of Common Stock resulting
from a stock split, reverse stock split, stock dividend, combination or
reclassification of the Common Stock, or any other increase or decrease in the
number of issued shares of Common Stock effected without receipt of
consideration by the Company. The conversion of any convertible securities of
the Company shall not be deemed to have been "effected without receipt of
consideration." Such adjustment shall be made by the Board, whose determination
in that respect shall be final, binding and conclusive. Except as expressly
provided herein, no issuance by the Company of shares of stock of any class, or
securities convertible into shares of stock of any class, shall affect, and no
adjustment by reason thereof shall be made with respect to, the number or price
of shares of Common Stock subject to an Option.

          (b)  Dissolution or Liquidation. In the event of the proposed
dissolution or liquidation of the Company, the Administrator shall notify the
Optionee at least fifteen (15) days prior to such proposed action. To the extent
it has not been previously exercised, the Option shall terminate immediately
prior to the consummation of such proposed action.

          (c)  Merger. In the event of a merger of the Company with or into
another corporation, each outstanding Option may be assumed or an equivalent
option may be substituted by such successor corporation or a parent or
subsidiary of such successor corporation. If, in such event, an Option is not
assumed or substituted, the Option shall terminate as of the date of the closing
of the merger. For the purposes of this paragraph, the Option shall be
considered assumed if, following the merger, the Option the right to purchase or
receive, for each Share of Optioned Stock subject to the Option immediately
prior to the merger, the consideration (whether stock, cash, or other securities
or property) received in the merger by holders of Common Stock for each Share
held on the effective date of the transaction (and if the holders are offered a
choice of consideration, the type of consideration chosen by the holders of a
majority of the outstanding Shares). If such consideration received in the
merger is not solely common stock of the successor corporation or its Parent,
the Administrator may, with the consent of the successor corporation, provide
for the consideration to be received upon the exercise of the Option, for each
Share of Optioned Stock subject to the Option, to be solely common stock of the
successor corporation or its Parent equal in fair market value to the per share
consideration received by holders of Common Stock in the merger.

                                      -7-
<PAGE>   8

     12.  Time of Granting Options. The date of grant of an Option shall, for
all purposes, be the date on which the Administrator makes the determination
granting such Option, or such other date as is determined by the Administrator.
Notice of the determination shall be given to each Employee or Consultant to
whom an Option is so granted within a reasonable time after the date of such
grant.

     13.  Amendment and Termination of the Plan.

          (a)  Amendment and Termination. The Board may at any time amend,
alter, suspend or discontinue the Plan, but no amendment, alteration, suspension
or discontinuation shall be made which would impair the rights of any Optionee
under any grant theretofore made, without his or her consent.

          (b)  Effect of Amendment or Termination. Any such amendment or
termination of the Plan shall not affect Options already granted, and such
Options shall remain in full force and effect as if this Plan had not been
amended or terminated, unless mutually agreed otherwise between the Optionee and
the Administrator, which agreement must be in writing and signed by the Optionee
and the Company.

     14.  Conditions Upon Issuance of Shares. Shares shall not be issued
pursuant to the exercise of an Option unless the exercise of such Option and the
issuance and delivery of such Shares pursuant thereto shall comply with all
relevant provisions of law, including, without limitation, the Securities Act of
1933, as amended, the Exchange Act, the rules and regulations promulgated
thereunder, and the requirements of any stock exchange upon which the Shares may
then be listed, and shall be further subject to the approval of counsel for the
Company with respect to such compliance.

          As a condition to the exercise of an Option, the Company may require
the person exercising such Option to represent and warrant at the time of any
such exercise that the Shares are being purchased only for investment and
without any present intention to sell or distribute such Shares if, in the
opinion of counsel for the Company, such a representation is required by any of
the aforementioned relevant provisions of law.

     15.  Reservation of Shares. The Company, during the term of this Plan,
shall at all times reserve and keep available such number of Shares as shall be
sufficient to satisfy the requirements of the Plan.

          The inability of the Company to obtain authority from any regulatory
body having jurisdiction, which authority is deemed by the Company's counsel to
be necessary to the lawful issuance and sale of any Shares hereunder, shall
relieve the Company of any liability in respect of the failure to issue or sell
such Shares as to which such requisite authority shall not have been obtained.

     16.  Agreements. Options shall be evidenced by written agreements in such
form as the Administrator shall approve from time to time.

                                    * * * * *

                                       -8-
<PAGE>   9
                                  PLAN HISTORY

<TABLE>
<S>                                <C>                         <C>
Initial Shares Granted             12,000,000                  07/06/00
</TABLE>

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