Document:

EXHIBIT 4.1

                                   RESOLUTIONS

      RESOLVED, that in payment for legal services provided to the Company by
Bruce J. Lurie from September 1, 2002 through March 31, 2003, the Company grants
350,000 shares of the Company's common stock to be registered in a registration
statement on Form S-8 to be filed with the Securities and Exchange Commission
("SEC") promptly after the Company becomes current in all of its filing
obligations under the Securities Exchange Act of 1934 (the "Exchange Act").

      RESOLVED, that in payment for legal services provided to the Company by
Myles J. Tralins from September 1, 2002 through March 31, 2003, the Company
grants 350,000 shares of the Company's common stock to be registered in a
registration statement on Form S-8 to be filed with the Securities and Exchange
Commission ("SEC") promptly after the Company becomes current in all of its
filing obligations under the Securities Exchange Act of 1934 (the "Exchange
Act").

      Dated: April 9, 2003<PAGE>

                                                                     Exhibit 4.1

                                 NETMANAGE, INC.

                             1992 STOCK OPTION PLAN

                    Amended and Restated as of April 25, 2002

1.    PURPOSE

      (a) The purpose of the Plan is to provide a means by which selected
Employees and Directors of and Consultants to the Company, and its Affiliates,
may be given an opportunity to purchase stock of the Company.

      (b) The Company, by means of the Plan, seeks to retain the services of
persons who are now Employees or Directors of or Consultants to the Company, to
secure and retain the services of new Employees, Directors and Consultants, and
to provide incentives for such persons to exert maximum efforts for the success
of the Company.

      (c) The Company intends that the Options issued under the Plan shall, in
the discretion of the Board or any Committee to which responsibility for
administration of the Plan has been delegated pursuant to subsection 3(c), be
either Incentive Stock Options or Nonstatutory Stock Options. All Options shall
be separately designated as Incentive Stock Options or Nonstatutory Stock
Options at the time of grant, and in such form as issued pursuant to section 6,
and a separate certificate or certificates will be issued for shares purchased
on exercise of each type of Option.

2.    DEFINITIONS

      (a) "Affiliate" means any parent corporation or subsidiary corporation,
whether now or hereafter existing, as those terms are defined in Sections 424(e)
and (f) respectively, of the Code.

      (b) "Board" means the Board of Directors of the Company.
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      (c) "Change in Control" shall mean a change in ownership or control of the
Company effected through any of the following transactions:

            (i) a merger, consolidation or other reorganization approved by the
Company's stockholders, unless securities representing more than fifty percent
(50%) of the total combined voting power of the voting securities of the
successor company are immediately thereafter beneficially owned, directly or
indirectly and in substantially the same proportion, by the persons who
beneficially owned the Company's outstanding voting securities immediately prior
to such transaction, or

            (ii) the sale, transfer or other disposition of all or substantially
all of the Company's assets in complete liquidation or dissolution of the
Company, or

            (iii) the acquisition, directly or indirectly by any person or
related group of persons (other than the Company or a person that directly or
indirectly controls, is controlled by, or is under common control with, the
Company), of beneficial ownership (within the meaning of Rule 13d-3 of the
Exchange Act) of securities possessing more than fifty percent (50%) of the
total combined voting power of the Company's outstanding securities pursuant to
a tender or exchange offer made directly to the Company's stockholders.

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

      (e) "Committee" means a Committee appointed by the Board in accordance
with subsection 3(c) of the Plan.

      (f) "Company" means NetManage, Inc., a Delaware corporation.

      (g) "Consultant" means any person, including an advisor, engaged by the
Company or an Affiliate to render services and who is compensated for such
services, provided that the term "Consultant" shall not include Directors who
are paid only a director's fee by the Company or who are not compensated by the
Company for their services as Directors.

      (h) "Continuous Status as an Employee, Director or Consultant" means the
employment or relationship as a Director or Consultant is not interrupted or
terminated by
<PAGE>
the Company or any Affiliate. The Board, in its sole discretion, may determine
whether Continuous Status as an Employee, Director or Consultant shall be
considered interrupted in the case of: (i) any leave of absence approved by the
Board, including sick leave, military leave, or any other personal leave; or
(ii) transfers between locations of the Company or between the Company,
Affiliates or their successors.

      (i) "Covered Employee" means the chief executive officer and the four (4)
other highest compensated officers of the Company for whom total compensation is
required to be reported to shareholders under the Exchange Act, as determined
for purposes of Section 162(m) of the Code.

      (j) "Director" means a member of the Board.

      (k) "Disability" means total and permanent disability as defined in
Section 22(e)(3) of the Code.

      (l) "Employee" means any person, including Officers and Directors,
employed by the Company or any Affiliate of the Company. Neither service as a
Director nor payment of a director's fee by the Company shall be sufficient to
constitute "employment" by the Company.

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

      (n) "Fair Market Value" means, as of any date, the value of the common
stock of the Company 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 System ("Nasdaq"), the Fair Market Value of a share of common stock shall
be the closing sales price for such stock (or closing bid, if no sales were
reported) as quoted on such system or exchange (or the exchange with the
greatest volume of trading in common stock) on the day of determination, as
reported in the Wall Street Journal or such other source as the Board deems
reliable;

            (ii) If the common stock is quoted on the Nasdaq System (but not on
the National Market System thereof) or is regularly quoted by a recognized
securities dealer but selling prices are not reported, the Fair Market Value of
a share of common stock shall be the mean between the high bid and high asked
prices for the common stock
<PAGE>
on the day of determination, as reported in the Wall Street Journal or such
other source as the Board deems reliable;

            (iii) In the absence of an established market for the common stock,
the Fair Market Value shall be determined in good faith by the Board.

      (o) "Hostile Take Over" means a change in ownership or control of the
Company effected through either of the following transactions:

            (i) a change in the composition of the Board over a period of
thirty-six (36) consecutive months or less such that a majority of the Board
members ceases, by reason of one or more contested elections for Board
membership, to be comprised of individuals who either (A) have been Board
members continuously since the beginning of such period or (B) have been elected
or nominated for election as Board members during such period by at least a
majority of the Board members described in clause (A) who were still in office
at the time the Board approved such election or nomination, or

            (ii) a Hostile Tender Offer.

      (p) "Hostile Tender Offer" means the acquisition, directly or indirectly,
by any person or related group of persons (other than the Company or a person
that directly or indirectly controls, is controlled by, or is under common
control with, the Company) of beneficial ownership (within the meaning of Rule
13d-3 of the Exchange Act) of securities possessing more than fifty percent
(50%) of the total combined voting power of the Company's outstanding securities
pursuant to a tender or exchange offer made directly to the Company's
stockholders which the Board does not recommend such stockholders to accept.

      (q) "Incentive Stock Option" means an Option intended to qualify as an
incentive stock option within the meaning of Section 422 of the Code and the
regulations promulgated thereunder.

      (r) "Non-Employee Director" means a Director who is a "Non-Employee
Director" within the meaning of Rule 16b-3.

      (s) "Nonstatutory Stock Option" means an Option not intended to qualify as
an Incentive Stock Option.
<PAGE>
      (t) "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.

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

      (v) "Option Agreement" means a written agreement between the Company and
an Optionee evidencing the terms and conditions of an individual Option grant.
The Option Agreement is subject to the terms and conditions of the Plan.

      (w) "Optioned Stock" means the common stock of the Company subject to an
Option.

      (x) "Optionee" means an Employee, Director or Consultant who holds an
outstanding Option.

      (y) "Outside Director" means a Director who is considered an "outside
director" for purposes of Section 162(m) of the Code and the regulations
promulgated thereunder.

      (z) "Plan" means this 1992 Stock Option Plan.

      (aa) "Plan Administrator" means the particular entity, whether the Board,
the Committee or any other committee, which is authorized to administer the Plan
with respect to one or more classes of eligible persons, to the extent such
entity is carrying out its administrative functions under the Plan with respect
to the persons under its jurisdiction.

      (bb) "Rule 16b-3" means Rule 16b-3 of the Exchange Act or any successor to
Rule 16b-3, as in effect when discretion is being exercised with respect to the
Plan.

3.    ADMINISTRATION

      (a) The Plan shall be administered by the Board unless and until the Board
delegates administration to a Committee, as provided in subsection 3(c).

      (b) The Board shall have the power, subject to, and within the limitations
of, the express provisions of the Plan:
<PAGE>
            (i) To determine from time to time which of the persons eligible
under the Plan shall be granted Options; when and how the Option shall be
granted; whether the Option will be an Incentive Stock Option or a Nonstatutory
Stock Option; the provisions of each Option granted (which need not be
identical), including the time or times such Option may be exercised in whole or
in part; and the number of shares for which an Option shall be granted to each
such person.

            (ii) To construe and interpret the Plan and Options granted under
it, and to establish, amend and revoke rules and regulations for its
administration. The Board, in the exercise of this power, may correct any
defect, omission or inconsistency in the Plan or in any Option Agreement, in a
manner and to the extent it shall deem necessary or expedient to make the Plan
fully effective.

            (iii) To amend the Plan as provided in Section 11.

      (c) The Board may delegate administration of the Plan to a committee
composed of not fewer than two (2) members (the "Committee"), all of the members
of which Committee shall be Non-Employee Directors and may also be, in the
discretion of the Board, Outside Directors. If administration is delegated to a
Committee, the Committee shall have, in connection with the administration of
the Plan, the powers theretofore possessed by the Board (and references in this
Plan to the Board shall thereafter be to the Committee), subject, however, to
such resolutions not inconsistent with the provisions of the Plan, as may be
adopted from time to time by the Board. The Board may abolish the Committee at
any time and revest in the Board the administration of the Plan. Notwithstanding
anything in this Section 3 to the contrary, the Board or the Committee may
delegate to a committee of one or more members of the Board the authority to
grant Options to eligible persons who (1) are not then subject to Section 16 of
the Exchange Act and/or (2) are either (i) not then Covered Employees and are
not expected to be Covered Employees at the time of recognition of income
resulting from such Option, or (ii) not persons with respect to whom the Company
wishes to comply with Section 162(m) of the Code.
<PAGE>
      (d) Any requirement that an administrator of the Plan be comprised of
Non-Employee Directors shall not apply if the Board or Committee expressly
declares that such requirement shall not apply.

4.    SHARES SUBJECT TO THE PLAN

      (a) Subject to the provisions of Section 10 relating to adjustments upon
changes in stock, the stock that may be sold pursuant to Options shall not
exceed in the aggregate 14,500,000 shares of the Company's common stock. Such
reserve shall consist of (i) the 200,000 shares initially authorized for
issuance under the Plan upon its adoption on July 26, 1992, (ii) the aggregate
12,800,000-share increases subsequently approved by the Board and the
stockholders plus (iii) an increase of 1,500,000 shares authorized by the Board
subject to stockholder approval at the 2002 Annual Shareholder Meeting.

      (b) The number of shares of Common Stock available for issuance under the
Plan shall automatically increase on the first trading day of January each
calendar year during the term of the Plan, beginning with the calendar year
2003, by an amount equal to three percent (3%) of the total number of shares of
Common Stock outstanding on the last trading day in December of the immediately
preceding calendar year, but in no event shall such annual increase exceed
2,000,000 shares.

      (c) Shares of common stock subject to outstanding options shall be
available for subsequent issuance under the Plan to the extent those options
expire or terminate for any reason prior to exercise in full. Unvested shares
issued under the Plan and subsequently cancelled or repurchased by the Company,
at a price per share not greater than the original issue price paid per share,
pursuant to the Company's repurchase rights under the Plan shall be added back
to the number of shares of common stock reserved for issuance under the Plan and
shall accordingly be available for reissuance through one or more subsequent
option grants under the Plan. However, should the exercise price of an option
under the Plan be paid with shares of common stock or should shares of common
stock otherwise issuable under the Plan be withheld by the Company in
satisfaction of the withholding taxes incurred in connection with the exercise
of an option under the Plan,
<PAGE>
then the number of shares of common stock available for issuance under the Plan
shall be reduced by the gross number of shares for which the option is exercised
and not by the net number of shares of common stock issued to the holder of such
option.

      (d) The stock subject to the Plan may be unissued shares or reacquired
shares, bought on the market or otherwise.

5.    ELIGIBILITY

      (a) Incentive Stock Options may be granted only to Employees. Nonstatutory
Stock Options may be granted only to Employees, Directors or Consultants.

      (b) No person shall be eligible for the grant of an Incentive Stock Option
if, at the time of grant, such person owns (or is deemed to own pursuant to
Section 424(d) of the Code) stock possessing more than ten percent (10%) of the
total combined voting power of all classes of stock of the Company or of any of
its Affiliates unless the exercise price of such Option is at least one hundred
ten percent (110%) of the Fair Market Value of such stock at the date of grant
and the Option is not exercisable after the expiration of five (5) years from
the date of grant.

      (c) Subject to the provisions of Section 10 relating to adjustments upon
changes in stock, no employee shall be eligible to be granted Options covering
more than four hundred thousand (400,000) shares of the Company's common stock
in any calendar year.

6.    OPTION PROVISIONS

      Each Option shall be in such form and shall contain such terms and
conditions as the Board shall deem appropriate. The provisions of separate
Options need not be identical, but each Option shall include (through
incorporation of provisions hereof by reference in the Option or otherwise) the
substance of each of the following provisions:

      (a) Term. No Option shall be exercisable after the expiration of ten (10)
years from the date it was granted.
<PAGE>
      (b) Price. The exercise price of each Incentive Stock Option shall be not
less than one hundred percent (100%) of the Fair Market Value of the stock
subject to the Option on the date the Option is granted. The exercise price of
each Nonstatutory Stock Option shall be not less than eighty-five percent (85%)
of the Fair Market Value of the stock subject to the Option on the date the
Option is granted.

      (c) Consideration. The purchase price of stock acquired pursuant to an
Option shall be paid, to the extent permitted by applicable statues and
regulations, (i) in cash at the time the Option is exercised, (ii) to the extent
the option is exercised for vested shares, through a special sale and remittance
procedure pursuant to which the Optionee shall concurrently provide irrevocable
instructions to (A) a Company-designated brokerage firm to effect the immediate
sale of the purchased shares and remit to the Company, out of the sale proceeds
available on the settlement date, sufficient funds to cover the aggregate
exercise price payable for the purchased shares plus all applicable income and
employment taxes required to be withheld by the Company by reason of such
exercise and (B) the Company to deliver the certificates for the purchased
shares directly to such brokerage firm in order to complete the sale.or (ii) at
the discretion of the Board or the Committee, either at the time of the grant or
exercise of the Option, (A) by delivery to the Company of other common stock of
the Company held for the requisite period necessary to avoid a charge to the
Company's earnings for financial reporting purposes and valued at Fair Market
Value on the exercise date, (B) according to a deferred payment or other
arrangement (which may include, without limiting the generality of the
foregoing, the use of other common stock of the Company) with the person to whom
the Option is granted or to whom the Option is transferred pursuant to
subsection 6(d), or (C) in any other form of legal consideration that may be
acceptable to the Board.

      The terms of any deferred payment arrangement (including the interest
rate) shall be determined by the Plan Administrator.

      (d) Transferability. An Incentive Stock Option shall not be transferable
except by will or by the laws of descent and distribution, and shall be
exercisable during the lifetime of the person to whom the Incentive Stock Option
is granted only by such person. A Non-Statutory Stock Option shall be subject to
the same restrictions, except
<PAGE>
that a Non-Statutory Option may, to the extent permitted by the Plan
Administrator, be assigned in whole or in part during the Optionee's lifetime
(i) as a gift to one or more members of the Optionee's immediate family, to a
trust in which Optionee and/or one or more such family members hold more than
fifty percent (50%) of the beneficial interest or to an entity in which more
than fifty percent (50%) of the voting interests are owned by one or more such
family members or (ii) pursuant to a domestic relations order. The terms
applicable to the assigned portion shall be the same as those in effect for the
option immediately prior to such assignment and shall be set forth in such
documents issued to the assignee as the Plan Administrator may deem appropriate.

            Notwithstanding the foregoing, the Optionee may also designate one
or more persons as the beneficiary or beneficiaries of his or her outstanding
options, and those options shall, in accordance with such designation,
automatically be transferred to such beneficiary or beneficiaries upon the
Optionee's death while holding those options. Such beneficiary or beneficiaries
shall take the transferred options subject to all the terms and conditions of
the applicable agreement evidencing each such transferred option, including
(without limitation) the limited time period during which the option may be
exercised following the Optionee's death.

      (e) Vesting. The total number of shares of stock subject to an Option may,
but need not, be allocated in periodic installments (which may, but need not, be
equal). The Option Agreement may provide that from time to time during each of
such installment periods, the Option may become exercisable ("vest") with
respect to some or all of the shares allotted to that period, and may be
exercised with respect to some or all of the shares allotted to such period
and/or any prior period as to which the Option became vested but was not fully
exercised. During the remainder of the term of the Option (if its term extends
beyond the end of the installment periods), the Option may be exercised from
time to time with respect to any shares then remaining subject to the Option.
The provisions of the subjection 6(e) are subject to any Option provisions
governing the minimum number of shares as to which an Option may be exercised.

      (f)   Regulatory Approvals.
<PAGE>
            (i) The implementation of the Plan, the granting of any stock option
under the Plan and the issuance of any shares of common stock upon the exercise
of any granted option shall be subject to the Company's procurement of all
approvals and permits required by regulatory authorities having jurisdiction
over the Plan, the stock options granted under it and the shares of common stock
issued pursuant to it.

            (ii) No shares of common stock or other assets shall be issued or
delivered under the Plan unless and until there shall have been compliance with
all applicable requirements of applicable securities laws, including the filing
and effectiveness of the Form S-8 registration statement for the shares of
common stock issuable under the Plan, and all applicable listing requirements of
any stock exchange (or the Nasdaq National Market, if applicable) on which
common stock is then listed for trading.

      (g) Termination of Employment or Relationship as a Director or Consultant.
In the event an Optionee's Continuous Status as an Employee, Director or
Consultant terminates (other than upon the Optionee's death or Disability), the
Optionee may exercise his or her Option, but only within such period of time as
is determined by the Board, and only to the extent that the Optionee was
entitled to exercise it at the date of termination (but in no event later than
the expiration of the term of such Option as set forth in the Option Agreement).
In the case of an Incentive Stock Option, the Board shall determine such period
of time (in no event to exceed three months from the date of termination) when
the Option is granted. If, at the date of termination, the Optionee is not
entitled to exercise his or her entire Option, the unexercisable portion of the
Option shall terminate and the shares covered by the unexercisable portion of
the Option shall revert to the Plan. If, after termination, the Optionee does
not exercise his or her Option within the time specified in the Option
Agreement, the Option shall terminate, and the shares covered by such Option
shall revert to the Plan.

      (h) Disability of Optionee. In the event an Optionee's Continuous Status
as an Employee, Director or Consultant terminates as a result of the Optionee's
Disability, the Optionee may exercise his or her Option, but only within twelve
(12) months from the date of such termination (or such shorter period specified
in the Option
<PAGE>
Agreement), and only to the extent that the Optionee was entitled to exercise it
at the date of such termination (but in no event later than the expiration of
the term of such Option as set forth in the Option Agreement). If, at the date
of termination, the Optionee is not entitled to exercise his or her entire
Option, the unexercisable portion of the Option shall terminate and the shares
covered by the unexercisable portion of the Option shall revert to the Plan. If,
after termination, the Optionee does not exercise his or her Option within the
time specified herein, the Option shall terminate, and the shares covered by
such Option shall revert to the Plan.

      (i) Death of Optionee. In the event of the death of an Optionee, the
Option may be exercised, at any time within twelve (12) months following the
date of death (or such shorter period specified in the Option Agreement) (but in
no event later than the expiration of the term of such Option as set forth in
the Option Agreement), 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
the Optionee was entitled to exercise the Option at the date of death. If, at
the time of death, the Optionee was not entitled to exercise his or her entire
Option, the unexercised portion of the Option shall terminate and the shares
covered by the unexercisable portion of the Option shall revert to the Plan. If,
after death, the Optionee's estate or a person who acquired 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.

      (j) Early Exercise. The Option may, but need not, include a provision
whereby the Optionee may elect at any time while an Employee, Director or
Consultant to exercise the Option as to any part or all of the shares subject to
the Option prior to the full vesting of the Option. Any unvested shares so
purchased may be subject to a repurchase right in favor of the Company or to any
other restriction the Board determines to be appropriate.

      (k) Withholding. The Company's obligation to deliver shares of common
stock upon the exercise of options under the Plan shall be subject to the
satisfaction of all applicable income and employment tax withholding
requirements. To the extent provided by the terms of an Option Agreement, the
Optionee may satisfy any applicable income
<PAGE>
and employment tax withholding obligation relating to the exercise of such
Option by any of the following means or by a combination of such means: (1)
tendering a cash payment; (2) authorizing the Company to withhold shares from
the shares of the common stock otherwise issuable to the participant as a result
of the exercise of the Option; or (3) delivering to the Company owned and
unencumbered shares of the common stock of the Company.

7.    COVENANTS OF THE COMPANY

      (a) During the terms of the Options, the Company shall keep available at
all times the number of shares of stock required to satisfy such Options.

      (b) The Company shall seek to obtain from each regulatory commission or
agency having jurisdiction over the Plan such authority as may be required to
issue and sell shares of stock upon exercise of the Options; provided, however,
that this undertaking shall not require the Company to register under the
Securities Act either the Plan, any Option or any stock issued or issuable
pursuant to any such Option. If, after reasonable efforts, the Company is unable
to obtain from such regulatory commission or agency the authority which counsel
for the Company deems necessary for the lawful issuance and sale of stock under
the Plan, the Company shall be relieved from any liability for failure to issue
and sell stock upon exercise of such Options unless and until such authority is
obtained.

8.    USE OF PROCEEDS FROM STOCK

      Proceeds from the sale of stock pursuant to Options shall constitute
general funds of the Company.

9.    MISCELLANEOUS
<PAGE>
      (a) Neither an Optionee nor any person to whom an Option is transferred
under subsection 6(d) shall be deemed to be the holder of, or to have any of the
rights of a holder with respect to, any shares subject to such Option unless and
until such person has satisfied all requirements for exercise of the Option
pursuant to its terms.

      (b) Nothing in the Plan or any instrument executed or Option granted
pursuant thereto shall confer upon any Employee, Director, Consultant or
Optionee any right to continue in the employ of the Company or any Affiliate (or
to continue acting as a Director or Consultant) or shall affect the right of the
Company or any Affiliate to terminate the employment or relationship as a
Director or Consultant of any Employee, Director, Consultant or Optionee with or
without cause.

      (c) To the extent that the aggregate Fair Market Value (determined at the
time of grant) of stock with respect to which Incentive Stock Options granted
after 1986 are exercisable for the first time by any Optionee during any
calendar year under all plans of the Company and its Affiliates exceeds one
hundred thousand dollars ($100,000), the Options or portions thereof which
exceed such limit (according to the order in which they were granted) shall be
treated as Nonstatutory Stock Options.

10.   ADJUSTMENTS UPON CHANGES IN STOCK

      (a) If any change is made in the stock subject to the Plan, or subject to
any Option (through merger, consolidation, reorganization, recapitalization,
stock dividend, dividend in property other than cash, stock split, liquidating
dividend, combination of shares, exchange of shares, change in corporate
structure or otherwise), the Plan and outstanding Options will be appropriately
adjusted in class(es) and maximum number of shares subject to the Plan, the
class(es) and maximum number of shares by which the share reserve may increase
annually and the maximum number of shares subject to award to any person during
any calendar year pursuant to subjection 5(d) and the outstanding Options will
be appropriately adjusted in the class(es) and number of shares and price per
share of stock subject to outstanding Options.
<PAGE>
      (b) Each option outstanding at the time of a Change in Control but not
otherwise fully-vested shall automatically accelerate so that each such option
shall, immediately prior to the effective date of the Change in Control, become
exercisable for all of the shares of common stock at the time subject to that
option and may be exercised for any or all of those shares as fully-vested
shares of common stock. However, an outstanding option shall not so accelerate
if and to the extent: (i) such option is, in connection with the Change in
Control, assumed or otherwise continued in full force and effect by the
successor corporation (or parent thereof) pursuant to the terms of the Change in
Control, (ii) such option is replaced with a cash incentive program of the
successor corporation which preserves the spread existing at the time of the
Change in Control on the shares of common stock for which the option is not
otherwise at that time exercisable and provides for subsequent payout in
accordance with the same vesting schedule applicable to those option shares or
(iii) the acceleration of such option is subject to other limitations imposed by
the Plan Administrator at the time of the option grant. Each option outstanding
at the time of the Change in Control shall terminate as provided in Section
9(c).

      (c) Immediately following the consummation of the Change in Control, all
outstanding options shall terminate and cease to be outstanding, except to the
extent assumed by the successor corporation (or parent thereof) or otherwise
expressly continued in full force and effect pursuant to the terms of the Change
in Control.

      (d) Each option which is assumed in connection with a Change in Control
shall be appropriately adjusted, immediately after such Change in Control, to
apply to the number and class of securities which would have been issuable to
the Optionee in consummation of such Change in Control had the option been
exercised immediately prior to such Change in Control. Appropriate adjustments
to reflect such Change in Control shall also be made to (i) the exercise price
payable per share under each outstanding option, provided the aggregate exercise
price payable for such securities shall remain the same, (ii) the maximum number
and/or class of securities available for issuance over the remaining term of the
Plan and (iii) the maximum number and/or class of securities for which any one
person may be granted options, separately exercisable
<PAGE>
stock appreciation rights and direct stock issuances under the Plan per calendar
year. To the extent the actual holders of the Company's outstanding Common Stock
receive cash consideration for their Common Stock in consummation of the Change
in Control, the successor corporation may, in connection with the assumption of
the outstanding options, substitute one or more shares of its own common stock
with a fair market value equivalent to the cash consideration paid per share of
Common Stock in such Change in Control.

      (e) The Plan Administrator may at any time provide that one or more
options will automatically accelerate in connection with a Change in Control,
whether or not those options are assumed or otherwise continued in full force
and effect pursuant to the terms of the Change in Control. Any such option shall
accordingly become exercisable, immediately prior to the effective date of such
Change in Control, for all of the shares of Common Stock at the time subject to
that option and may be exercised for any or all of those shares as fully-vested
shares of Common Stock. In addition, the Plan Administrator may at any time
provide that one or more of the Company's repurchase rights shall not be
assignable in connection with such Change in Control and shall terminate upon
the consummation of such Change in Control.

      (f) The Plan Administrator may at any time provide that one or more
options will automatically accelerate upon an Involuntary Termination of the
Optionee's Service within a designated period (not to exceed eighteen (18)
months) following the effective date of any Change in Control in which those
options do not otherwise accelerate. Any options so accelerated shall remain
exercisable for fully-vested shares until the earlier of (i) the expiration of
the option term or (ii) the expiration of the one (1) year period measured from
the effective date of the Involuntary Termination. In addition, the Plan
Administrator may at any time provide that one or more of the Company's
repurchase rights shall immediately terminate upon such Involuntary Termination.

      (g) The Plan Administrator may at any time provide that one or more
options will automatically accelerate in connection with a Hostile Take-Over.
Any such option shall become exercisable, immediately prior to the effective
date of such Hostile Take-Over, for all of the shares of common stock at the
time subject to that option and may be
<PAGE>
exercised for any or all of those shares as fully-vested shares of common stock.
In addition, the Plan Administrator may at any time provide that one or more of
the Company's repurchase rights shall terminate automatically upon the
consummation of such Hostile Take-Over. Alternatively, the Plan Administrator
may condition such automatic acceleration and termination upon an Involuntary
Termination of the Optionee's Service within a designated period (not to exceed
eighteen (18) months) following the effective date of such Hostile Take-Over.
Each option so accelerated shall remain exercisable for fully-vested shares
until the expiration or sooner termination of the option term.

      (h) The portion of any Incentive Option accelerated in connection with a
Change in Control or Hostile Take Over shall remain exercisable as an Incentive
Option only to the extent the applicable One Hundred Thousand Dollar ($100,000)
limitation is not exceeded. To the extent such dollar limitation is exceeded,
the accelerated portion of such option shall be exercisable as a Non-Statutory
Stock Option under the Federal tax laws.

11.   AMENDMENT OF THE PLAN

      (a) The Board at any time, and from time to time, may amend the Plan.
However, except as provided in Section 10 relating to adjustments upon changes
in stock, no amendment shall be effective unless approved by the stockholders of
the Company within twelve (12) months before or after the adoption of the
amendment, where the amendment will:

            (i) Increase the number of shares reserved for Options under the
Plan;

            (ii) Modify the requirements as to eligibility for participation in
the Plan (to the extent such modification requires stockholder approval in order
for the Plan to satisfy the requirements of section 422 of the Code); or

            (iii) Modify the Plan in any other way if such modification requires
stockholder approval in order for the Plan to satisfy the requirements of
Section 422 of the Code or to comply with the requirements of Rule 16b-3.
<PAGE>
      (b) The Board may in its sole discretion submit any other amendment to the
Plan for stockholder approval, including, but not limited to, amendments to the
Plan intended to satisfy the requirements of Section 162(m) of the Code and the
regulations promulgated thereunder regarding the exclusion of performance-based
compensation from the limit on corporate deductibility of compensation paid to
certain executive officers.

      (c) It is expressly contemplated that the Board may amend the Plan in any
respect the Board deems necessary or advisable to provide Optionees with the
maximum benefits provided or to be provided under the provisions of the Code and
the regulations promulgated thereunder relating to Incentive Stock Options
and/or to bring the Plan and/or Incentive Stock Options granted under it into
compliance therewith.

      (d) Rights and obligations under any Option granted before amendment of
the Plan shall not be altered or impaired by any amendment of the Plan unless
(i) the Company requests the consent of the person to whom the Option was
granted and (ii) such person consents in writing.

12.   TERMINATION OR SUSPENSION OF THE PLAN

      (a) The Board may suspend or terminate the Plan at any time. Unless sooner
terminated, the Plan shall terminate on April 24, 2012. No Options may be
granted under the Plan while the Plan is suspended or after it is terminated.

      (b) Rights and obligations under any Option granted while the Plan is in
effect shall not be altered or impaired by suspension or termination of the
Plan, except with the consent of the person to whom the Option was granted.

13.   EFFECTIVE DATE OF THE PLAN

      The Plan become effective upon its adoption by the Board. The Plan was
amended and restated in its entirety on April 25, 2002 to effect the following
changes:

            (i) increase the share reserve by 1,500,000 shares;
<PAGE>
            (ii) implement an automatic share increase provision;

            (iii) provide that in the event of a Change in Control, Options will
accelerate only to the extent not assumed or otherwise continued in connection
with the transaction;

            (iv) authorize the Plan Administrator to grant options that
accelerate in a Change in Control, a Hostile Take-Over or upon a subsequent
termination of the Optionee's employment following such transaction;

            (v) allow Non-Statutory Options to be transferable under certain
circumstances; and

            (vi) make certain other changes to provide additional flexibility to
the Plan Administrator to design awards under the Plan and to reflect changes in
applicable laws and regulations.

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