Document:

Exhibit 4.2

                          AMENDMENT TO RIGHTS AGREEMENT

         This Amendment, dated as of August 15, 2001 (the "Amendment"), is to
the Rights Agreement dated as of January 19, 1999 (the "Rights Agreement"),
between MCB Financial Corporation, a California corporation ( "MCB"), and U.S.
Stock Transfer Corporation (the "Rights Agent").

         WHEREAS, the Board of Directors of MCB has approved an Agreement and
Plan of Reorganization dated as of August 15, 2001 between Business Bancorp
("BB"), a California corporation and MCB providing for the merger of MCB with
and into BB and a related Merger Agreement (such agreements together, the
"Merger Agreements");

         WHEREAS, the Merger Agreements contemplate that MCB, at the time such
agreements are executed, shall have taken all actions necessary to prevent the
Merger Agreements and the transactions contemplated therein from triggering the
Rights (as defined in the Rights Agreement) outstanding under the Rights
Agreement;

         WHEREAS, the Board of Directors has determined that this Amendment is
in the best interests of MCB and its shareholders; and

         WHEREAS, MCB and the Rights Agent have determined that, pursuant to
Section 27 of the Rights Agreement, the Rights Agreement may be amended as set
forth herein without the approval of the holders of the Rights.

         NOW, THEREFORE, in consideration of the premises and the mutual
agreements set forth herein, MCB and the Rights Agent hereby agree as follows:

         1. This Amendment shall become effective on the date that MCB and BB
have both executed the Merger Agreements, immediately before such execution.

         2. Subsection 1(a) of the Rights Agreement is hereby amended to include
the following additional sentence to immediately follow the current language
therein: "Notwithstanding the foregoing, neither Business Bancorp, a California
corporation, nor any of its Affiliates or Associates, shall be an `Acquiring
Person.'"

         3. Section 1 of the Rights Agreement is hereby amended to include a new
Subsection 1(aa) which shall read as follows: "`Section 11(a)(ii) Event' shall
mean any Trigger Event as defined in Section 11(a)(ii)."

         4. Section 1 of the Rights Agreement is hereby amended to include a new
Subsection 1(bb) which shall read as follows:

         "Section 13 Event" shall mean any event described in clause (i), (ii),
         (iii) or (iv) of Section 13(a) of this Agreement, other than the
         delivery, execution or performance or consummation of any of the
         transactions contemplated in the Agreement and Plan of Reorganization
         dated as of August 15, 2001 between Business Bancorp, a California
         corporation and the Company and the related Merger Agreement.

<PAGE>

         5. Section 1 of the Rights Agreement is hereby amended to include a new
Subsection 1(cc) which shall read as follows: "`Trigger Event'" shall mean any
Section 11(a)(ii) Event or any Section 13 Event."

         6. The Rights Agreement is hereby amended to include a new Subsection
(v) to Section 11(a) thereof which shall read as follows:

         (v) Notwithstanding anything in this Agreement to the contrary, the
         execution, delivery, performance or consummation of any of the
         transactions contemplated in the Agreement and Plan of Reorganization
         dated as of August 15, 2001 between Business Bancorp and the Company
         and the related Merger Agreement will not be deemed Trigger Events.

         7. Section 13 of the Rights Agreement is hereby amended to include a
new Subsection 13(f) which shall read as follows:

         (f) Notwithstanding anything in this Agreement to the contrary, this
         Section 13 shall not be applicable to the execution, delivery, or the
         performance or consummation of any of the transactions contemplated in,
         the Agreement and Plan of Reorganization dated as of August 15, 2001
         between Business Bancorp and the Company and the related Merger
         Agreement.

         8. The form of Summary of Rights to Purchase Preferred Shares attached
as Exhibit C to the Rights Agreement is hereby replaced in its entirety by the
form of Summary of Rights to Purchase Common Shares attached as Exhibit A
hereto.

         9. As promptly as practicable following the date of this Amendment, MCB
shall take all appropriate actions to cause the legend on the certificates for
the Common Stock referring to the Rights Agreement to make reference to this
Amendment.

         10. This Amendment shall be limited solely to the matters expressly set
forth herein and shall not (a) prejudice any right or rights which MCB may now
have or may in the future have under or in connection with the Agreement or any
instruments or agreements referred to therein or (b) except to the extent
expressed as set forth herein, modify the Agreement or any Rights, or any
instruments or agreements referred to therein.

         11. Unless defined herein, all capitalized terms shall have the
meanings provided in the Rights Agreement.

         12. This Amendment shall be deemed to be a contract under the laws of
the State of California and for all purposes shall be governed by and construed
in accordance with the laws of such State applicable to contracts to be made and
performed entirely within such State.

                                       2

<PAGE>

         13. This Amendment may be executed in any number of counterparts and
each of such counterparts shall for all purposes be deemed to be an original,
and all such counterparts shall together constitute but one and the same
instrument. Signatures by facsimile transmission are deemed acceptable.

         14. This Amendment shall be for the sole and exclusive benefit of MCB,
the Rights Agent and the registered holders of the Rights Certificates (and,
prior to the Distribution Date, MCB's common shares). Nothing in this Amendment
shall be construed to give any person other than MCB, the Rights Agent and the
registered holders of the Rights Certificates (and, prior to the Distribution
Date, MCB's common shares) any legal or equitable right, remedy or claim under
this Amendment and the Merger Agreement.

         IN WITNESS WHEREOF, the parties have caused this Amendment to be duly
executed and their respective corporate seals to be hereto affixed and attested,
all as of the date and year first above written.

                                   MCB FINANCIAL CORPORATION

                                   By:      /s/Charles O. Hall
                                      ---------------------------------------
                                             Charles O. Hall

                                   Its: President & Chief Executive Officer
                                       --------------------------------------

                                   AMERICAN SECURITIES TRANSFER AND TRUST CO.

                                   By: /s/ William Garza
                                      ---------------------------------------
                                           William Garza

                                   Its:  Vice President
                                       --------------------------

                                       3

                                                                       EXHIBIT A

                 SUMMARY OF RIGHTS TO PURCHASE PREFERRED SHARES

                  On December 17, 1998, the Board of Directors of MCB Financial
Corporation (the "Company") declared a dividend of one preferred share purchase
right (a "Right") for each outstanding share of common stock, no par value (the
"Common Shares"), of the Company. The dividend was payable on February 8, 1999
(the "Record Date") to the shareholders of record on that date. Each Right
entitles the registered holder to purchase from the Company one one-hundredth of
a share of Series A Junior Participating Preferred Stock, no par value (the
"Preferred Shares"), of the Company at a price of $37.00 per one one-hundredth
of a Preferred Share (the "Purchase Price"), subject to adjustment. The
description and terms of the Rights are set forth in a Rights Agreement dated as
of January 19, 1999 (the "Rights Agreement") between the Company and U. S. Stock
Transfer Corporation, as Rights Agent (the "Rights Agent").

                  Initially, the Rights will be attached to all certificates
representing Common Shares then outstanding, regardless of whether any such
certificate has a copy of this Summary of Rights attached thereto, and no
separate Right Certificates will be distributed. The Rights will separate from
the Common Shares and a Distribution Date will occur upon the earlier of (i) 10
days following a public announcement that a person or group of affiliated or
associated persons have acquired beneficial ownership of 10% or more of the
outstanding Common Shares (an "Acquiring Person"); provided, however, a person
or group holding 10% or more of the outstanding shares as of January 19, 1999
will become a "Grandfathered Person" and such Grandfathered Person will be
treated as an Acquiring Person upon public announcement or knowledge by the
Company's Board of Directors that such Grandfathered Person has acquired
beneficial ownership of an additional 1% of the outstanding Common Shares; or
(ii) 10 business days (or such later date as may be determined by action of the
Board of Directors prior to such time as any Person becomes an Acquiring Person)
following the commencement of, or announcement of an intention to make, a tender
offer or exchange offer the consummation of which would result in the beneficial
ownership by a person or group of 10% or more of such outstanding Common Shares
(unless the Company's Board of Directors has approved the offer). On August 15,
2001, the Rights Agreement was amended (the "Amendment") to allow MCB and
Business Bancorp, a California corporation ("BB") to enter into and engage in
the transactions described in an Agreement and Plan of Merger dated August 15,
2001 between MCB and BB pursuant to which MCB will merge with BB (the "BB
Merger") and a related Stock Option Agreement by MCB and BB (such agreements
collectively, the "BB Merger Agreements"). As amended, the Rights Agreement
provides that BB and its Affiliates and Associates will not be Acquiring Persons
as a result of the BB Merger Agreements or the transactions described in those
agreements, nor will consummation of any of the transactions contemplated by the
BB Merger Agreements trigger the exercisability of the Rights described herein.

                  The Rights Agreement provides that, until the Distribution
Date, the Rights will be transferred with and only with the Common Shares. Until
the Distribution Date (or earlier redemption or expiration of the Rights), new
Common Share certificates issued after the Record

                                      C-1

<PAGE>

Date, upon transfer or new issuance of Common Shares, will contain a notation
incorporating the Rights Agreement by reference. Until the Distribution Date (or
earlier redemption or expiration of the Rights), the surrender for transfer of
any certificates for Common Shares outstanding as of the Record Date, even
without such notation or a copy of this Summary of Rights being attached
thereto, will also constitute the transfer of the Rights associated with the
Common Shares represented by such certificate. As soon as practicable following
the Distribution Date, separate certificates evidencing the Rights ("Right
Certificates") will be mailed to holders of record of the Common Shares as of
the close of business on the Distribution Date and such separate Right
Certificates alone will evidence the Rights.

                  The Rights are not exercisable until the Distribution Date.
The Rights will expire on January 30, 2009 (the "Final Expiration Date"), unless
the Rights are earlier redeemed or exchanged by the Company, in each case as
described below.

                  The Purchase Price payable, and the number of Preferred Shares
or other securities or property issuable, upon exercise of the Rights are
subject to adjustment from time to time to prevent dilution (i) in the event of
a stock dividend on, or a subdivision, combination or reclassification of, the
Preferred Shares, (ii) upon the grant to holders of the Preferred Shares of
certain rights or warrants to subscribe for or purchase Preferred Shares at a
price, or securities convertible into Preferred Shares with a conversion price,
less than the then current market price of the Preferred Shares or (iii) upon
the distribution to holders of the Preferred Shares of evidences of indebtedness
or assets (excluding regular periodic cash dividends paid out of earnings or
retained earnings or dividends payable in Preferred Shares) or of subscription
rights or warrants (other than those referred to above).

                  The number of outstanding Rights and the number of one
one-hundredths of a Preferred Share issuable upon exercise of each Right are
also subject to adjustment in the event of a stock split of the Common Shares or
a stock dividend on the Common Shares payable in Common Shares or a subdivision,
consolidation or combination of the Common Shares occurring, in any such case,
prior to the Distribution Date.

                  Preferred Shares purchasable upon exercise of the Rights will
not be redeemable. Each Preferred Share will be entitled to a minimum
preferential dividend payment of 100 times the dividend declared per Common
Share. In the event of liquidation, the holders of the Preferred Shares will be
entitled to a minimum preferential liquidation payment of $100.00 per share but
will be entitled to an aggregate payment of 100 times the payment made per
Common Share. Each Preferred Share will have 100 votes, voting together with the
Common Shares. Finally, in the event of any merger, consolidation or other
transaction in which Common Shares are exchanged, each Preferred Share will be
entitled to receive 100 times the amount received per Common Share. These rights
are protected by customary antidilution provisions.

                  Because of the nature of the Preferred Shares' dividend,
liquidation and voting rights, the value of the one one-hundredth interest in a
Preferred Share purchasable upon exercise of each Right should approximate the
value of one Common Share.

                                      C-2

<PAGE>

                  In the event that (i) any person or group of affiliated or
associated persons becomes an Acquiring Person, or (ii) during such time as
there is an Acquiring Person, there shall be a reclassification of securities or
a recapitalization or reorganization of the Company or other transaction or
series of transactions involving the Company which has the effect of increasing
by more than 1% the proportionate share of the outstanding shares of any class
of equity securities of the Company or any of its subsidiaries beneficially
owned by the Acquiring Person (each a "flip-in" event), proper provision shall
be made so that each holder of a Right, other than Rights beneficially owned by
the Acquiring Person (which will thereafter be void), will thereafter have the
right to receive upon exercise that number of Common Shares (or, in the event
that there are insufficient authorized Common Shares, substitute consideration
such as cash, property, or other securities of the Company, such as Preferred
Stock) having a market value of two times the exercise price of the Right. In
the event that the Company is acquired in a merger or other business combination
transaction or 50% or more of its consolidated assets or earning power are sold
(a "flip-over event"), proper provision will be made so that each holder of a
Right will thereafter have the right to receive, upon the exercise thereof at
the then current exercise price of the Right, that number of shares of common
stock of the acquiring company which at the time of such transaction will have a
market value of two times the exercise price of the Right.

                  At any time after the acquisition by a person or group of
affiliated or associated persons of beneficial ownership of 10% or more of the
outstanding Common Shares and prior to the acquisition by such person or group
of 50% or more of the outstanding Common Shares, the Board of Directors of the
Company may exchange the Rights (other than Rights owned by such person or group
which have become void), in whole or in part, at an exchange ratio of one Common
Share, or one one-hundredth of a Preferred Share (or of a share of a class or
series of the Company's preferred stock having equivalent rights, preferences
and privileges), per Right (subject to adjustment).

                  With certain exceptions, no adjustment in the Purchase Price
will be required until cumulative adjustments require an adjustment of at least
1% in such Purchase Price. No fractional Preferred Shares will be issued (other
than fractions which are integral multiples of one one-hundredth of a Preferred
Share, which may, at the election of the Company, be evidenced by depository
receipts) and in lieu thereof, an adjustment in cash will be made based on the
market price of the Preferred Shares on the last trading day prior to the date
of exercise.

                  At any time before a person becomes an Acquiring Person, the
Board of Directors of the Company may redeem the Rights in whole, but not in
part, at a price of $0.001 per Right (the "Redemption Price"). After the
redemption period has expired, the Company's rights of redemption may be
reinstated if, prior to completion of certain recapitalizations, mergers or
other business combinations, an Acquiring Person reduces its beneficial
ownership to less than 10% of the outstanding Common Shares in a transaction or
series of transactions not involving the Company. The redemption of the rights
may be made effective at such time, on such basis and with such conditions as
the Board of Directors in its sole discretion may establish. Immediately upon
any redemption of the Rights, the right to exercise the Rights will terminate
and the only right of the holders of Rights will be to receive the Redemption
Price.

                                      C-3

<PAGE>

                  The terms of the Rights may be amended by the Board of
Directors of the Company without the consent of the holders of the Rights,
including an amendment to lower certain thresholds described above to not less
than the greater of (i) any percentage greater than the largest percentage of
the outstanding Common Shares then known to the Company to be beneficially owned
by any person or group of affiliated or associated persons (unless such person
or group is excluded from the effect of such reduction) and (ii) 10%, except
that from and after such time as any person becomes an Acquiring Person no such
amendment may adversely affect the interests of the holders of the Rights.

                  Until a Right is exercised, the holder of a Right will not, by
reason of being such a holder, have rights as a shareholder of the Company,
including, without limitation, the right to vote or to receive dividends.

                  Copies of the Rights Agreement and the Amendment have been
filed with the Securities and Exchange Commission as Exhibits to a Registration
Statement on Form 8-A. Copies of the Rights Agreement and the Amendment are
available free of charge from the Company. This summary description of the
Rights does not purport to be complete and is qualified in its entirety by
reference to the Rights Agreement and the Amendment which are hereby
incorporated herein by reference.

                                      C-4<PAGE>   1

                                                                     EXHIBIT 4.1

                                   ISOPIA INC.

                   (FORMERLY ISOPIA INTERACTIVE NETWORK INC.)

                                STOCK OPTION PLAN

                                 January 1, 2000

                                  Prepared by:

                                   SMITH LYONS
                                   Suite 5800
                                  Scotia Plaza
                               40 King Street West
                                Toronto, Ontario
                                     M5H 3Z7

<PAGE>   2

                                TABLE OF CONTENTS

                                      PAGE

<TABLE>
<S>      <C>                                                                  <C>
ARTICLE 1 DEFINITIONS AND CONSTRUCTION ....................................     1

1.1      Definitions ......................................................     1
1.2      Construction of this Stock Option Plan ...........................     2

ARTICLE 2 ADMINISTRATION OF STOCK OPTION PLAN .............................     2

2.1      Stock Option Plan Established ....................................     2
2.2      Board to Determine Participants and Extent of Options ............     3
2.3      Option Agreement .................................................     3
2.4      Board to Interpret, Change or Terminate Stock Option Plan ........     3
2.5      Restrictions on Change or Termination of Stock Option Plan .......     4
2.6      Effect of Board Actions; Liability of Board Members ..............     4
2.7      Total Number of Shares Issuable Under Stock Option Plan ..........     4
2.8      Lapsed Options ...................................................     5
2.9      Stock Option Plan Register .......................................     5
2.10     Shareholders Agreement ...........................................     5
2.11     No Duty to Issue Fractional Shares ...............................     5

ARTICLE 3 NATURE OF OPTIONS ...............................................     5

3.1      Option Price .....................................................     5
3.2      Option Period ....................................................     5
3.3      Vesting ..........................................................     6
3.4      Limit on Purchase of Shares Subject to Option ....................     6
3.5      Exercise of Option ...............................................     6
3.6      Cashless Exercise Rights .........................................     6
3.7      Employment or Engagement Ends ....................................     7
3.8      Death, Mental Disability or Physical Disability of Optionee ......     7
3.9      Regulatory Approvals and Regulatory Requirements .................     8
3.10     Issuance of Shares ...............................................     8
3.11     Call Right on Termination ........................................     8

ARTICLE 4 GENERAL .........................................................     9

4.1      Rights of Optionees Not Assignable ...............................     9
4.2      Restriction on Residents of Foreign Jurisdiction .................     9
4.3      No Rights as a Shareholder .......................................    10
4.4      No Contract of Employment Rights .................................    10
4.5      Effect of Right to Purchase Pro Rata Additional Shares ...........    10
4.6      Consolidation, Merger, etc .......................................    10
4.7      Adjustment in Number of Shares, Etc ..............................    10
4.8      Take-Over Bid ....................................................    11
4.9      Acceleration on Sale .............................................    11
4.10     No Representation or Warranty ....................................    11
4.11     Compliance with Applicable Law ...................................    12
4.12     Modifications to Stock Option Plan ...............................    12
4.13     Interpretation ...................................................    12
</TABLE>

<PAGE>   3

                                   ISOPIA INC.

                   (FORMERLY ISOPIA INTERACTIVE NETWORK INC.)

                                STOCK OPTION PLAN

                                    ARTICLE 1
                          DEFINITIONS AND CONSTRUCTION

1.1 DEFINITIONS

The following terms shall have the following meanings for the purposes of this
Stock Option Stock Option Plan, except where the context or subject matter is
inconsistent therewith:

"BOARD" means the board of directors of the Corporation or, if established and
authorized to act, means a committee of the Board specifically designated by the
Board to be responsible for the Stock Option Plan;

"BUSINESS DAY" means any day, other than a Saturday, Sunday or statutory holiday
observed in Ontario;

"CONSULTANT" means a person with whom the Corporation or a Subsidiary has a
contract for substantial personal services;

"CORPORATION" means ISOPIA Interactive Network Inc., a corporation incorporated
pursuant to the laws of Ontario, and includes any successor corporation thereto;

"OPTION" means an option to purchase Shares issued pursuant to, or governed by,
this Stock Option Plan;

"OPTION PERIOD" has the meaning attributed to it in Section 3.2;

"OPTION PRICE" has the meaning attributed to it in Section 3.1;

"OPTIONEE" means a Participant to whom an Option has been issued pursuant to
this Stock Option Plan;

"PARTICIPANT" means a person designated under Section 2.2 and "PARTICIPANTS"
means all persons designated under that Section;

                                       1
<PAGE>   4

"PERSONNEL CONTRACT" means a contract between the Corporation and an employee or
Consultant or a contract between a Subsidiary and an employee or Consultant,
relating to the employment or engagement of the employee or Consultant, as the
case may be;

"SHARES" means common shares in the capital stock of the Corporation as adjusted
in accordance with Sections 4.6 and 4.7, and all substitutions for common shares
of the Corporation under Sections 4.6 and 4.7;

"STOCK EXCHANGE" means any stock exchange upon which the Shares are listed for
trading;

"STOCK OPTION AGREEMENT" means an agreement with an Optionee setting out the
terms and conditions to which any grant of Options to that Optionee is subject;

"STOCK OPTION PLAN" means this Stock Option Plan;

"SUBSIDIARY" means a subsidiary corporation of the Corporation; and

"TAKE-OVER BID" means a take-over bid within the meaning of applicable
securities legislation.

1.2 CONSTRUCTION OF THIS STOCK OPTION PLAN

The headings of all articles, sections, and paragraphs in this Stock Option Plan
are inserted for convenience of reference only and shall not affect the
construction or interpretation of this Stock Option Plan. Whenever the singular
or masculine are used in this Stock Option Plan, the same shall be construed as
being the plural or feminine or neuter or vice versa where the context so
requires. All references to currency in this Stock Option Plan are references to
Canadian currency. "Hereby", "hereunder", and similar expressions refer to this
Stock Option Plan as a whole and not to any particular article, section,
paragraph or other part of this Stock Option Plan.

                                    ARTICLE 2
                       ADMINISTRATION OF STOCK OPTION PLAN

2.1 STOCK OPTION PLAN ESTABLISHED

(a) The Stock Option Plan is hereby established with the intent of advancing the
interests of the Corporation by encouraging and enabling the acquisition of an
equity interest in the Corporation by key employees, directors, officers and
Consultants. All options issued to such persons are governed by the Stock Option
Plan.

(b) The general purpose and intent of this Stock Option Plan shall be to
encourage and reward the services and loyalty of those persons who are
employees, officers, directors and Consultants of the Corporation, and any
Subsidiary, from time to time and to attract new key persons to serve in such
positions, thus furthering the management and growth of the Corporation.

                                       2
<PAGE>   5
(c) The officers and directors of the Corporation designated by the Board are
hereby authorized and empowered to do all things and execute and deliver all
instruments, undertakings and applications and writings as they, in their
absolute discretion, consider necessary for the implementation of this Stock
Option Plan and any regulations or administrative policies under this Stock
Option Plan.

(d) This Stock Option Plan shall become effective upon a date to be determined
by the Board.

2.2 BOARD TO DETERMINE PARTICIPANTS AND EXTENT OF OPTIONS

(a) The Board may from time to time by resolution designate key employees,
directors, officers and Consultants of the Corporation or a Subsidiary as
Participants in this Stock Option Plan. Each Participant may be issued an Option
or Options, with the terms (including the number of Shares subject to the
Option, the Option Price and the Option Period) as determined by the Board in
accordance with this Stock Option Plan.

(b) In determining the terms of any Option, the Board may consider the present
and future contributions of the Participant and any other factors the Board
deems appropriate. The judgment of the Board in designating Participants and in
determining the terms of any Option shall be final, conclusive and binding for
all purposes under this Stock Option Plan.

(c) For the purposes hereof, any person who is both a director and an employee
or Consultant of the Corporation, if such person participates in this Stock
Option Plan, shall be deemed to participate as an employee or Consultant, and
not as a director, for all the purposes hereof.

2.3 OPTION AGREEMENT

Each Option issued under this Stock Option Plan shall be evidenced by an option
agreement in such form as shall be determined by the Board.

2.4 BOARD TO INTERPRET, CHANGE OR TERMINATE STOCK OPTION PLAN

Subject to Section 2.5, the Board shall have the unfettered power, where
consistent with the general purpose and intent of the Stock Option Plan as set
out in Section 2.1:

(a) to interpret the provisions of this Stock Option Plan and to make
regulations and formulate administrative policies for carrying this Stock Option
Plan into effect;

(b) to make such changes to this Stock Option Plan, any Options issued pursuant
to this Stock Option Plan and this Stock Option Plan's regulations and
administrative policies as, from time to time, the Board deems appropriate in
the best interests of the Corporation; and

(c) to rescind or terminate this Stock Option Plan as the Board shall deem
advisable, at any time.

                                       3
<PAGE>   6

2.5 RESTRICTIONS ON CHANGE OR TERMINATION OF STOCK OPTION PLAN

A change to this Stock Option Plan, to any Options or to any regulations or
administrative policies under this Stock Option Plan shall be subject to
approval, if required, by a Stock Exchange and any other regulatory authority
having jurisdiction over the securities of the Corporation. If a change to this
Stock Option Plan, to any Options or to any regulations or administrative
policies under this Stock Option Plan would:

(a) materially increase the benefits under this Stock Option Plan or any Options
issued pursuant to this Stock Option Plan;

(b) increase the number of Shares, other than by virtue of Sections 4.6 and 4.7
of this Stock Option Plan, which may be issued pursuant to this Stock Option
Plan; or

(c) materially modify the requirements as to eligibility for participation in
this Stock Option Plan, and the Stock Exchange or any other regulatory authority
having jurisdiction over the securities of the Corporation requires such a
change to be approved by the shareholders of the Corporation, then such a change
shall not be effective until it is approved by the shareholders of the
Corporation. No rescission or termination of this Stock Option Plan shall impair
or change any rights and Options without the written consent of the Optionees
affected.

2.6 EFFECT OF BOARD ACTIONS; LIABILITY OF BOARD MEMBERS

(a) All actions taken and interpretations or determinations made by the Board
shall be final, conclusive and binding on the Participants and the Corporation.
No member of the Board shall be personally liable for any action taken or
determination or interpretation made in connection with this Stock Option Plan.

(b) All members of the Board shall be fully protected, indemnified and held
harmless by the Corporation with respect to any action taken or determination or
interpretation made.

(c) All costs incurred in connection with the creation and administration of
this Stock Option Plan, not including commissions, if any, on exercise of any
Options, shall be for the account of the Corporation.

2.7 TOTAL NUMBER OF SHARES ISSUABLE UNDER STOCK OPTION PLAN

The maximum number of Shares made available for this Stock Option Plan shall be
determined from time to time by the Board but shall not, in any event, exceed
ten (10%) percent of the total issued and outstanding Shares of the Corporation.
No one employee or Consultant shall have more than 5 percent of the Options at
any time.

                                       4
<PAGE>   7
2.8 LAPSED OPTIONS

If an Option issued under this Stock Option Plan is surrendered, terminates or
expires without being exercised in whole or in part, the Shares which were
reserved for issue pursuant to such Option but which were not issued shall
become available for issue pursuant to the exercise of other Options under this
Stock Option Plan.

2.9 STOCK OPTION PLAN REGISTER

The Corporation shall maintain a register containing the name and address of
each Optionee, the material information relating to each Option (including the
term, number of Shares, purchase price of Shares, the extent to which each
Option has been exercised and the extent to which each Option is available to be
exercised) and the total number of authorized but unissued Shares allocated to
and made available to be issued to Participants under this Stock Option Plan.

2.10 SHAREHOLDERS AGREEMENT

If there is an agreement of any kind among shareholders of the Corporation
relating to the Corporation or to dealing in shares of the Corporation's capital
stock, each Optionee shall execute such agreement as a pre-condition to the
allotment and issuance of Shares by the Corporation to such Optionee.

2.11 NO DUTY TO ISSUE FRACTIONAL SHARES

The Corporation shall not be obligated to issue fractional Shares in
satisfaction of any of its obligations under this Stock Option Plan. Rather than
issue a fractional Share in satisfaction of any of its obligations under this
Stock Option Plan, the Corporation shall round down the number of Shares to be
issued to an Optionee to the nearest full Share.

                                    ARTICLE 3
                                NATURE OF OPTIONS

3.1 OPTION PRICE

The price per share at which a Share that is the subject of an Option may be
purchased (the "OPTION PRICE") shall be determined by the Board at the time the
Option is issued.

3.2 OPTION PERIOD

The Option Period for each Option shall be such period of time as shall be
determined by the Board, provided that no Option Period shall exceed five (5)
years. If the Option is not exercised prior to the expiry of the Option Period,
the Option shall expire and be of no further force or effect.

                                       5
<PAGE>   8

3.3 VESTING

The Board shall determine when Options shall vest and over what period of time
and to what extent Optionees may exercise their Options. Such determinations
shall be contained in the relevant Stock Option Agreements or Personnel
Contracts with the individual Optionees. Where the Board makes no such
determination, then Section 3.4 shall apply.

3.4 LIMIT ON PURCHASE OF SHARES SUBJECT TO OPTION

(a) Unless otherwise determined by the Board or unless otherwise provided in a
Personnel Contract, Shares subject to the Option may be purchased by exercising
the Option on the first anniversary date of its issue, and on each later
anniversary date during the Option Period, with respect to twenty per cent (20%)
of the total number of Shares subject to the Option (rounded down in each case
to the nearest full Share). For clarity, at the end of each of 5 anniversaries
of the date of granting Options, twenty (20%) of the Options so granted vest and
may be exercised in the manner set out in this Plan. On the 5th anniversary, all
Options will have vested.

(b) Subject to Section 4.9, unless otherwise determined by the Board or as
provided in any relevant agreement to which the Corporation is a party
(including, without limitation, a Personnel Contract or Stock Option Agreement),
all or any part of the Shares that may (owing to vesting and/or the effluxion of
time) be purchased on a particular anniversary date of the grant of Options may
be purchased either at that time or any time thereafter during the Option
Period.

3.5 EXERCISE OF OPTION

Subject to the provisions of this Stock Option Plan and any regulations or
administrative policies established by the Board under this Stock Option Plan,
an Option may be exercised by the Optionee delivering to the Corporation at its
registered office a written notice specifying the number of Shares with respect
to which the Option is being exercised and, at the same time, payment in full of
the purchase price of the Shares then being purchased by way of cash or
certified cheque in favour of the Corporation.

3.6 CASHLESS EXERCISE RIGHTS

Subject to Section 3.9 and provided the Shares are listed on a Stock Exchange,
and with the consent of the Board, an Optionee may, rather than exercise an
Option which the Optionee is entitled to exercise under this Stock Option Plan,
elect to terminate the Option in whole or in part and, in lieu of receiving the
Shares to which the terminated Option relates, receive the number of Shares,
disregarding fractions, which, when multiplied by the fair market value of the
Shares to which the terminated Option relates, has a value equal to the product
of the number of Shares to which the terminated Option relates multiplied by the
difference between the fair market value and the Option Price of the Shares to
which the terminated Option relates, less any amount withheld on account of
income taxes, which withheld income taxes will be remitted by the Corporation.
The fair market value of the Shares shall be the closing price of the Shares on
the

                                       6
<PAGE>   9

Stock Exchange on the last trading day immediately preceding the date of
exercise of rights under this Section 3.6.

3.7 EMPLOYMENT OR ENGAGEMENT ENDS

(a) Subject to Section 3.8 or any relevant agreement (including a stock option
agreement with an employee or Consultant) or any express resolution passed by
the Board with respect to an Option, an Option and all rights to purchase
pursuant thereto shall expire and terminate:

        (i) if the Optionee's employment or engagement is terminated by the
Corporation without cause, sixty (60) days after the date the Optionee ceases to
be a director, officer, employee or Consultant of the Corporation or of any
Subsidiary; or

        (ii) if the Optionee resigns, thirty (30) days after the date the
Optionee ceases to be a director, officer, employee or Consultant of the
Corporation or of any Subsidiary; or

        (iii) if the Optionee's employment or engagement is terminated by the
Corporation with cause, on the date the Optionee ceases to be a director,
officer, employee or Consultant of the Corporation or of any Subsidiary.

(b) Options shall not be affected by any change of employment of the Optionee or
by the Optionee ceasing to be a director where the Optionee continues to be
employed by the Corporation or continues to be a director of a Subsidiary or an
officer of the Corporation or a Subsidiary.

3.8 DEATH, MENTAL DISABILITY OR PHYSICAL DISABILITY OF OPTIONEE

If, before the expiry of an Option in accordance with the Option's terms, the
Optionee's employment with the Corporation or a Subsidiary terminates by reason
of:

(a) the death of the Optionee;

(b) the mental disability of the Optionee; or

(c) the physical disability of the Optionee,

such Option may, subject to the terms of the Option and the Stock Option Plan,
be exercised by

(d) the legal representative of the Optionee's estate;

(e) the legal representative of the Optionee; or

(f) the Optionee, as the case may be, at any time during the first twelve (12)
months following the Optionee's termination, provided that the exercise occurs
prior to the expiry of the

                                       7
<PAGE>   10

Option in accordance with the Option's terms and that the exercise is limited to
the extent that the Optionee was entitled to exercise the Option at the date of
the Optionee's termination.

3.9 REGULATORY APPROVALS AND REGULATORY REQUIREMENTS

(a) The obligation of the Corporation to issue and deliver any Shares in
accordance with this Stock Option Plan shall be subject to any necessary
approval of the Stock Exchange and any other regulatory authority having
jurisdiction over the securities of the Corporation. If any Shares cannot be
issued to any Optionee for whatever reason, the obligation of the Corporation to
issue such Shares shall terminate and any Option Price paid to the Corporation
shall be returned to the Optionee.

(b) If at any time the Corporation determines, in its sole discretion, that it
is necessary or desirable to comply with the legal or other requirements of a
Stock Exchange or any other regulatory authority as a condition of, or in
connection with, the exercise of an Option or the issue of Shares under an
Option, then the Optionee's exercise of the Option shall not be effective unless
the Optionee complies with such legal or other requirements in a manner
satisfactory to the Corporation.

3.10 ISSUANCE OF SHARES

No Optionee or legal representative of an Optionee shall be, or shall be deemed
to be, a holder of any Shares, until the Corporation issues a certificate (or
certificates) for such Shares. Subject to Sections 2.10 and 3.9, upon an
Optionee exercising an Option and paying the Corporation the purchase price for
the Shares in respect of which the Option has been exercised, the Corporation
shall as soon as practicable issue and deliver a certificate (or certificates)
representing the Shares so purchased, registered in the name of the Optionee or
the Optionee's estate, as the case may be.

3.11 CALL RIGHT ON TERMINATION

(a) If any Optionee who acquired an Option or Options as an employee or
Consultant of the Corporation (for the purpose of this Section 3.11, (a
"NON-DIRECTOR PARTICIPANT") ceases to be an employee or Consultant of the
Corporation and of any Subsidiary, the Corporation shall be entitled to purchase
the Shares owned or acquired by the Non-Director Participant, or his estate or
legal representative, as the case may be, at the fair market value thereof.

(b) For the purposes of this Section 3.11, the fair market value shall be
determined by the Board as a purchase price equal to the price per share
determined by the Board at which shares of the Corporation have most recently
been sold by the Corporation, other than pursuant to the exercise of an Option,
or the most recent Option Price so determined prior to the date upon which the
Non-Director Participant ceases to be an employee or Consultant of the
Corporation, multiplied by the number of Shares held by the Non-Director
Participant (the "PURCHASE PRICE").

                                       8
<PAGE>   11
(c) The right of the Corporation to purchase Shares pursuant to this Section
3.11 may be exercised by the Corporation, at the direction of the Board, by
giving written notice to the Non-Director Participant within one hundred and
twenty (120) days of the date such Non-Director Participant ceased to hold his
or her respective role. The Non-Director Participant and a representative of the
Corporation shall meet on the date specified in such notice, which date shall be
a business day in Toronto and shall be not more than fifteen (15) days following
the expiry of the aforementioned one hundred and twenty (120) day notice period,
at 10:00 a.m. at the offices of counsel for the Corporation. The Non-Director
Participant shall attend with all of his or her share certificates duly endorsed
for transfer and a representative of the Corporation shall attend prepared to
tender the fair market value of such Shares in the form of a promissory note
bearing simple interest at the rate of ten (10%) percent per annum until paid
and having a term of one (1) year from the date specified in the notice. The
parties agree to execute all such other documentation as may reasonably be
required to conclude the transfers of Shares. If the Non-Director Participant
does not attend within one hour of the appointed time, the Corporation's
obligations to the Non-Director Participant may be satisfied by depositing the
promissory note in trust with counsel for the Corporation for the benefit of the
Non-Director Participant, following which the Corporation shall duly register
the transfer of the Shares of the Non-Director Participant or their
cancellation, as the case may require.

(d) The Non-Director Participant shall be deemed to have agreed, by his or her
execution of any Option, to have granted to the officers of the Corporation from
time to time a power of attorney to effect all such transfers and execute all
such documents as are required to give effect to the intentions of this Section
3.11, which power of attorney, being a power coupled with an interest, shall not
be terminable.

                                    ARTICLE 4
                                     GENERAL

4.1 RIGHTS OF OPTIONEES NOT ASSIGNABLE

Except as provided in Section 3.8 hereof or by the laws of descent and
distribution, the rights of any Optionee and any Options under this Stock Option
Plan are personal to the Optionee and are not assignable.

4.2 RESTRICTION ON RESIDENTS OF FOREIGN JURISDICTION

No resident of a foreign jurisdiction may be an Optionee in this Stock Option
Plan unless such participation can be accomplished pursuant to or in accordance
with and without violating any securities or other legislation of the foreign
jurisdiction.

4.3 NO RIGHTS AS A SHAREHOLDER

No Optionee shall have any rights as a shareholder of the Corporation with
respect to any Shares that are the subject of an Option. No Optionee shall be
entitled to receive, and no adjustment

                                       9
<PAGE>   12

shall be made for, any dividends, distributions or other rights declared for
shareholders of the Corporation for which the record date is prior to the date
of exercise of the Optionee's Option.

4.4 NO CONTRACT OF EMPLOYMENT RIGHTS

Nothing contained in this Stock Option Plan shall confer or be deemed to confer
upon an Optionee the right to continue in the employment of, or to provide
services to, the Corporation, nor interfere or be deemed to interfere in any way
with any right of the Corporation to discharge an Optionee at any time for any
reason whatsoever, with or without cause. Participation in this Stock Option
Plan by an Optionee shall be voluntary.

4.5 EFFECT OF RIGHT TO PURCHASE PRO RATA ADDITIONAL SHARES

If at any time the Corporation grants to the holders of its capital stock rights
to subscribe for and purchase pro rata additional securities of the Corporation
or of another entity, no adjustment shall be made to the number of Shares or
other securities subject to an Optionee's Option and the Shares subject to the
Option shall remain unaffected.

4.6 CONSOLIDATION, MERGER, ETC.

Without limiting the generality of Section 4.7, if there is a consolidation,
merger or statutory amalgamation or arrangement of the Corporation with or into
another corporation or a separation of the business of the Corporation into two
or more entities, then the Optionees shall be entitled to replacement Options
having substantially the same economic value, on a pre-tax basis, as the Options
existing prior to such event.

4.7 ADJUSTMENT IN NUMBER OF SHARES, ETC.

(a) In the event there is any change in the Shares, whether by reason of a stock
dividend, consolidation, subdivision, reclassification or otherwise, an
appropriate adjustment, to create substantially the same economic value, on a
pre-tax basis, shall be made by the Board in:

        (i) the number of Shares available under this Stock Option Plan;

        (ii) the number of Shares subject to any Option; and

        (iii) the exercise price of the Shares subject to any Option, provided
that, if necessary, the prior written consent of the Stock Exchange and any
other regulatory authority having jurisdiction over the securities of the
Corporation has been obtained.

(b) If an adjustment under this Section 4.7 would result in a fractional Share,
the fraction shall be disregarded and the Optionee shall have the right only to
acquire the number of full Shares. All adjustments under this Section 4.7 shall
be final, conclusive and binding for all purposes of this Stock Option Plan.

                                       10
<PAGE>   13

4.8 TAKE-OVER BID

(a) Where the Corporation becomes the subject of a Take-Over Bid pursuant to
which 100% of the issued and outstanding Shares are acquired by the offeror,
either directly or as a result of the compulsory acquisition provisions of the
incorporating statute, and whether or not the consideration is paid in whole or
in part in equity securities of the offeror, the Board may send notice to all
Optionees requiring them to surrender their Options within ten (10) days of the
mailing of such notice.

(b) In such a case, the Optionees shall be deemed to have surrendered such
Options ten (10) Business Days after the mailing of the notice without further
formality, provided that:

        (i) the offeror delivers with such notice an irrevocable and
unconditional offer to issue replacement options to the Optionees on the equity
securities, if any, offered as consideration; and

        (ii) the Board has determined, in good faith, that such replacement
options have substantially the same economic value as the Options being
surrendered; and

        (iii) if the continuing corporation is listed on a Stock Exchange, the
prior written consent of the Stock Exchange has been obtained, if necessary.

4.9 ACCELERATION ON SALE

(a) In the event of a sale of the issued and outstanding Shares to any person or
group of persons the result of which will be a change in control of the
Corporation, each unexpired Option held by Directors (who are not employees or
Consultants), whether vested or not yet vested, may be exercised no later than
ten (10) days prior to the closing of the sale for all the Shares subject to
that Option, in order to permit the Shares subject to such unexpired Option to
be tendered in response to such a sale.

(b) If there is an offer to purchase all the issued and outstanding shares of
the Corporation, the Board may, in its discretion, require all Options (whether
or not vested) to be exercised in order to permit the Shares subject to Options
to be sold as part of the purchase transaction, and the Board may send a notice
in writing to the Optionees informing them that their Options are deemed to have
been terminated, and the Optionees shall be entitled to such portion of the
price payable pursuant to the purchase transaction as the Board, acting
reasonably, may allocate to such Optionees.

4.10 NO REPRESENTATION OR WARRANTY

The Corporation makes no representation or warranty as to the future market
value of any Shares issued in accordance with the provisions of this Stock
Option Plan or as to the tax consequences of any actions taken pursuant to this
Plan or any relevant agreement made pursuant hereto.

                                       11
<PAGE>   14

4.11 COMPLIANCE WITH APPLICABLE LAW

If a provision of this Stock Option Plan or an Option contravenes any law or any
order, policy, by-law or regulation of any regulatory body having jurisdiction,
then such provision shall be deemed to be amended to the extent necessary to
bring such provision into compliance therewith.

4.12 MODIFICATIONS TO STOCK OPTION PLAN

Subject to the approval, if necessary, of the Stock Exchange and to the by-laws
of the Corporation, the Board shall have the right, in its unfettered
discretion, to alter, amend or discontinue the Stock Option Plan from time to
time and at any time. No such amendment or discontinuation, however, may,
without the consent of each Optionee, alter or impair such Optionee's rights or
increase such Optionee's financial obligations to the Corporation under the
Stock Option Plan.

4.13 INTERPRETATION

This Stock Option Plan shall be governed by and construed in accordance with the
laws of the Province of Ontario.

APPROVED by the Board of Directors on January 1, 2000 and ratified, approved and
confirmed by the shareholders of the Corporation on January 1, 2000.

                                       12

Source: [{"source": "alea-institute/alea-institute/kl3m-data-edgar-agreements/train-00029-of-00352.parquet"}, [{"source": "alea-institute/alea-institute/kl3m-data-edgar-agreements/train-00029-of-00352.parquet"}]]