Document:

<PAGE>

EXHIBIT 10.36

                               PROMISSORY NOTE

$75,000.00                                                   February 4, 2003

     FOR VALUE RECEIVED, the undersigned, DCA of Cincinnati, LLC, an Ohio
limited liability company (the "Borrower"), hereby promises to pay to the
order of Dialysis Corporation of America, a Florida corporation (the "Lender")
(and a member of the Borrower under an Operating Agreement dated November 8,
2001 by and between Lender and two other 20% members of the Borrower,
Pupizion, Inc., an Ohio limited liability company ("Pupizion"), from whom
the Borrower is leasing the premises located at 7501 Affinity Plaza, Mt.
Healthy, Ohio (the "Facility"), and Bepo, Inc., an Ohio limited liability
company (the "Operating Agreement"), all capitalized terms except as
provided in this recourse promissory note (the "Note") shall have the
meanings as defined in the Operating Agreement), or the Lender's successors
and assigns (hereinafter, with any subsequent holder, the "Holder"), at its
principal offices located at 1344 Ashton Road, Suite 201, Hanover, Maryland
21076, or at such other place or to such other party as the Holder of this
Note may from time to time designate in writing, the principal sum of
Seventy-Five Thousand Dollars ($75,000.00) together with interest on the
principal balance outstanding from time to time at the fixed rate of two
(2%) percent over the prime rate as set by the Lender's primary financing
institution until this Note is paid in full.  The interest rate on the date
hereof is 6.25% per annum.  All payments hereunder shall be made in lawful
currency of the United States and in immediately available funds.  Interest
shall be calculated on the basis of the actual number of days elapsed over a
360-day year.

     1. Financing.  This Note has been issued by the Lender in connection
        ---------
with the construction of the Facility by the Lender, and the Lender having
extended, in addition to the other construction costs, the principal sum
under this Note for tenant improvements by the Borrower to the Facility,
which is deemed Financing under the Operating Agreement, and other than the
terms set forth in this Note, the terms and provisions as provided for the
repayment of Financing under the Operating Agreement shall govern, in
particular but not limited to Section 7.2, indicating no distributions or
allocations shall be made to any Member until Member Financings have been
first fully paid, which has also been reflected in other provisions of the
Operating Agreement, including but not limited to Articles 9, 10 and 12.

     2. Priority and Time of Payment.  Subject to the terms and provisions
        ----------------------------
of the Operating Agreement relating to Financing and its repayment, this
Note shall be paid in whole or in part prior to any other payments by the
Borrower to any other person at the earlier of (i) five years from the date
of this Note, or (ii) at such time the Borrower, pursuant to the decision
of the Borrower's Majority Members, which includes the Holder of this Note,
has Cash Flow or other Special Proceeds available for distribution under
Article 9 of the Operating Agreement, subject to any tax payment
distributions under Sections 9.1(ii) and 12.2(i) of the Operating Agreement
(the "Maturity Date").

     Notwithstanding anything herein or in the Operating Agreement to the
contrary, in the event the Borrower sells any Company Interests other than
the Initial Company Interests, then the proceeds of such sale shall be first
used to reduce or otherwise fully repay the principal sum and accrued
interest under this Note, the balance of any proceeds of such Company
Interest sale shall be used in accordance with the requirements of the
Borrower and in accordance with the Operating Agreement.

     3. Application of Payments.  All payments on account of the indebtedness
        -----------------------
evidenced by this Note prior to demand or acceleration shall be applied first,
to any and all costs, expenses, or charges then owed the Holder by the
Borrower; second, to accrued and unpaid interest; third, to the payment of
late charges provided herein; and the balance to the unpaid principal until
the full amount of principal

<PAGE>

and interest has been paid in full.  All payments so received after demand or
acceleration shall be applied in such manner as the Holder may determine in
its sole and absolute discretion.

     4. Costs of Collections.  If all sums due under this Note are not paid
        --------------------
in full when due, the Borrower agrees to pay, in addition to the sums due
hereunder, all costs of collection (including reasonable attorneys' fees
and expenses), whether suit be brought or not.

     5. Prepayment/Acceleration.  Amounts borrowed hereunder together with
        -----------------------
all accrued interest thereon may be prepaid at any time prior to the Maturity
Date without penalty.

     6. Default
        -------

        6.1 The occurrence of any one or more of the following events shall
constitute an "Event of Default":

            a. Borrower fails or neglects to observe, perform or comply with
the terms, conditions, covenants or warranties contained in this Note, the
Operating Agreement or any other agreement now existing or hereafter executed
evidencing, securing or relating to any way to the obligations, which are
required to be observed, performed or complied with by the Borrower;

            b. The occurrence of any material uninsured damage to or loss,
theft or destruction of any of the Borrower's property;

            c. Borrower is enjoined, restrained or in any way prevented by
the order of any court or any administrative or regulatory agency from
conducting all or any material part of its business;

            d. Any strike, lockout, labor dispute, embargo, condemnation,
act of G-d or public enemy, or other casualty which causes the cessation or
substantial curtailment of the Borrower's revenue producing activities for 30
days or more;

            e. The loss, suspension or revocation of, or failure to renew,
any material license or permit now held or hereafter acquired by the Borrower;

            f. The entry of judgment or the issuance of a warrant of
attachment, execution or similar process against the Borrower or its property
in excess of $50,000, which shall not be dismissed, discharged or bonded
within thirty (30) days;

            g. Lender ceases to hold a majority interest in the Borrower;

            h. The occurrence of any material adverse change in the financial
condition of the Borrower; or

            i. Borrower shall (A) make a general assignment for the benefit of
creditors; (B) commence any case, proceeding or other action seeking to have
an order for relief entered on its behalf as a debtor or to adjudicate it a
bankrupt or insolvent, or seeking reorganization, arrangement, adjustment,
liquidation, dissolution or composition of it or its debts or seeking
appointment of a receiver, trustee, custodian or other similar official for
it or for all or any substantial part of its property (collectively a
"proceeding for relief"); (C) become the subject to any proceeding for relief

<PAGE>

which is not dismissed within 60 days of its filing or entry; or (D) be
dissolved or otherwise fail to maintain its legal existence.

        6.2 Acceleration of Obligations Upon Default.  Upon and after an Event
            ----------------------------------------
of Default, all of the Borrower's obligations herein may, at the option of the
Lender, without any legal process, be declared, and immediately shall become
due and payable.

     7. Default Interest Rate.  Upon the occurrence, and during the
        ---------------------
continuance of, an Event of Default, the rate of interest accruing on the
unpaid principal balance hereof and accrued interest thereon shall be
increased to a fixed rate of fifteen percent (15%) per annum.

     8. Maximum Rate of Interest.  This Note is subject to the express
        ------------------------
condition that at no time shall the Borrower be obligated or required to pay
interest hereunder at a rate that could subject the Borrower to either civil
or criminal liability as a result of being in excess of the maximum rate
which the Borrower is permitted by law to contract or agree to pay.  If, by
the terms of this Note, the Borrower is at any time required or obligated to
pay interest at a rate in excess of such maximum rate, the rate of interest
under this Note shall be deemed to be immediately reduced to such maximum
rate as permitted by law, and interest payable hereunder shall be computed
at such maximum rate and the portion of all prior interest payments in
excess of such maximum rate shall be applied and shall be deemed to have
been payments in reduction of the principal balance of this Note.

     9. Waivers.  The Borrower waives all exemption rights, whether under any
        -------
state constitution, homestead exemption or otherwise, and also waives demand,
presentment for payment, notice of dishonor, protest valuation and appraisal,
notice of protest, notice of dishonor, and any other notice required to be
given by law in connection with the delivery, acceptance, performance, default
or enforcement of this Note, and consents to all forbearance or waiver of any
term hereof or release or discharge by the Holder hereof of the Borrower,
substitution or exchange of any security for the payment hereof or the
failure to act on the part of the Holder or any other indulgence shown by
the Holder from time to time, in one or more instances (without notice to or
further assent from the Borrower) and the Borrower agrees that no such
action, failure to act or failure to exercise any right or remedy on the
part of the Holder shall in any way affect or impair the obligations of the
Borrower hereunder or be construed as a waiver by the Holder of or otherwise
affect any of the Holder's rights under this Note, under any endorsement or
guaranty of this Note, or under any document or instrument evidencing any
security for payment of this Note, and the Borrower expressly agrees that
the Maturity Date hereof may be extended from time to time by the written
consent of the Holder without in any way affecting the liability of the
Borrower.

     10. Governing Law.  This Note shall be governed by, and construed in
         -------------
accordance with, the laws of the State of Ohio.

     11. Severability.  In the event any one or more of the provisions
         ------------
contained in this Note shall, for any reason, be held to be invalid,
illegal, or unenforceable in any respect, such invalidity, illegality, or
unenforceability shall not affect any other provision of this Note and
this Note shall be construed as if such invalid, illegal, or unenforceable
provision had never been contained herein.

     12. No Oral Modifications or Waivers.  This Note may not be changed
         --------------------------------
orally, but only by an agreement in writing signed by the parties against
whom enforcement of any waiver, change, modification or discharge is sought.

<PAGE>

     13. Due Authority and Enforceability.  The representative of the Borrower
         --------------------------------
subscribing below represents that he or she has full power, authority and
legal right to execute and deliver this Note and that the debt hereunder
constitutes a valid and binding obligation of Borrower.

     14. WAIVER OF JURY TRIAL.  THE BORROWER HEREBY KNOWINGLY, VOLUNTARILY
         --------------------
AND INTENTIONALLY WAIVES THE RIGHTS IT MAY HAVE TO A TRIAL BY JURY IN ANY
LITIGATION BASED HEREON, OR ARISING OUT OF, OR IN CONNECTION WITH THIS NOTE,
THE OPERATING AGREEMENT AND RELATED DOCUMENTS.  THIS PROVISION WAS
SPECIFICALLY BARGAINED FOR AND IS A MATERIAL INDUCEMENT FOR THE HOLDER TO
EXTEND CREDIT AND MAKE THE LOAN TO THE BORROWER.

     15. Assignment.  This Note and the obligations hereunder may not be
         ----------
assigned by the Borrower without the prior written consent of the Holder.

     16. Binding Effect.  This Note shall be binding upon the Borrower and
         --------------
its successors and assigns and shall inure to the benefit of the Holder and
its successors and assigns.

     17. Headings.  The headings in this Note are for convenience of reference
         --------
only and shall not define or limit any terms or provisions hereof.

     18. Non-Membership Status of the Lender.   Pursuant to Article 7 of the
         -----------------------------------
Operating Agreement, with respect to the granting of this Note, Lender, or
any future Holder, will be treated as a non-Member of the Borrower.

     19. Use of Certain Terms.  The words "herein," "hereof," "hereunder" and
         --------------------
other words of similar import refer to this Note as a whole and not to any
particular section of this Note unless specifically stated otherwise in this
Note.

                         {signatures on following pages}

<PAGE>

     IN WITNESS WHEREOF, the Borrower has duly executed this Note as of the
day and year first above written.

                                       BORROWER:

                                       DCA OF CINCINNATI, LLC,
                                       an Ohio limited liability company

                                       By Members:
                                       DIALYSIS CORPORATION OF AMERICA

                                          /s/ Stephen W. Everett
                                       By:------------------------------------
                                          Name: STEPHEN W. EVERETT
                                          Title: President

STATE OF MARYLAND      )
                       )   SS:
COUNTY OF ANNE ARUNDEL )

     The foregoing instrument was acknowledged before me this 4th day of
February, 2003 by Stephen W. Everett, the President of Dialysis Corporation
of America, a Florida corporation, on behalf of the corporation.

                                       /s/ Anne M. Davis
                                       ---------------------------------------
                                       Notary Public

                                       PUPIZION, INC.

                                          /s/ Alvaro A. Reyes
                                       By:------------------------------------
                                          Name: ALVARO A. REYES, M.D.
                                          Title: President

STATE OF OHIO    )
                 )   SS:
COUNTY OF BUTLER )

    The foregoing instrument was acknowledged before me this 6TH day of
February, 2003 by Alvaro A. Reyes, M.D., the President of Pupizion, Inc., an
Ohio limited liability company, on behalf of the company.

                                       /S/ James J. Carroll
                                       ---------------------------------------
                                       Notary Public

<PAGE>

                                       BEPO, INC.

                                          /S/ Beatriz Porras
                                       By:------------------------------------
                                          Name: BEATRIZ PORRAS, M.D.
                                          Title: President

STATE OF OHIO    )
                 )   SS:
COUNTY OF BUTLER )

     The foregoing instrument was acknowledged before me this 6TH day of
February, 2003 by Beatriz Porras, M.D., the President of Bepo, Inc., an
Ohio limited liability company, on behalf of the company.

                                       /s/ James J. Carroll
                                       ---------------------------------------
                                       Notary Public

5

<PAGE><PAGE>

                                                                     EXHIBIT 4.1

                             RHAPSODY NETWORKS, INC.

                           2000 EQUITY INCENTIVE PLAN

                              ADOPTED JUNE 1, 2000
                      APPROVED BY STOCKHOLDERS JUNE 1, 2000
                        SHARES INCREASED ON JUNE 1, 2000
                        STOCK SPLIT ON DECEMBER 15, 2000
                      SHARES INCREASED ON FEBRUARY 20, 2001
                        SHARES INCREASED ON JULY 24, 2001
                     APPROVED BY STOCKHOLDERS AUGUST 1, 2001
                         TERMINATION DATE: MAY 30, 2010

1.       PURPOSES.{TC}

         (a)      ELIGIBLE STOCK AWARD RECIPIENTS. The persons eligible to
receive Stock Awards are the Employees, Directors and Consultants of the Company
and its Affiliates.

         (b)      AVAILABLE STOCK AWARDS. The purpose of the Plan is to provide
a means by which eligible recipients of Stock Awards may be given an opportunity
to benefit from increases in value of the Common Stock through the granting of
the following Stock Awards: (i) Incentive Stock Options, (ii) Nonstatutory Stock
Options, (iii) stock bonuses and (iv) rights to acquire restricted stock.

         (c)      GENERAL PURPOSE. The Company, by means of the Plan, seeks to
retain the services of the group of persons eligible to receive Stock Awards, to
secure and retain the services of new members of this group and to provide
incentives for such persons to exert maximum efforts for the success of the
Company and its Affiliates.

2.       DEFINITIONS.{TC}

         (a)      "AFFILIATE" means any parent corporation or subsidiary
corporation of the Company, 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.

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

         (d)      "COMMITTEE" means a committee of one or more members of the
Board appointed by the Board in accordance with subsection 3(c).

         (e)      "COMMON STOCK" means the common stock of the Company.

                                       1.

<PAGE>

         (f)      "COMPANY" means Rhapsody Networks, Inc., a Delaware
corporation.

         (g)      "CONSULTANT" means any person, including an advisor, (i)
engaged by the Company or an Affiliate to render consulting or advisory services
and who is compensated for such services or (ii) who is a member of the Board of
Directors of an Affiliate. However, the term "Consultant" shall not include
either Directors who are not compensated by the Company for their services as
Directors or Directors who are merely paid a director's fee by the Company for
their services as Directors.

         (h)      "CONTINUOUS SERVICE" means that the Participant's service with
the Company or an Affiliate, whether as an Employee, Director or Consultant, is
not interrupted or terminated. The Participant's Continuous Service shall not be
deemed to have terminated merely because of a change in the capacity in which
the Participant renders service to the Company or an Affiliate as an Employee,
Consultant or Director or a change in the entity for which the Participant
renders such service, provided that there is no interruption or termination of
the Participant's service to the Company or an Affiliate. For example, a change
in status from an Employee of the Company to a Consultant of an Affiliate or a
Director will not constitute an interruption of Continuous Service. The Board or
the chief executive officer of the Company, in that party's sole discretion, may
determine whether Continuous Service shall be considered interrupted in the case
of any leave of absence approved by that party, including sick leave, military
leave or any other personal leave.

         (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 stockholders under the Exchange Act,
as determined for purposes of Section 162(m) of the Code.

         (j)      "DIRECTOR" means a member of the Board of Directors of the
Company.

         (k)      "DISABILITY" means (i) before the Listing Date, the inability
of a person, in the opinion of a qualified physician acceptable to the Company,
to perform the major duties of that person's position with the Company or an
Affiliate of the Company because of the sickness or injury of the person and
(ii) after the Listing Date, the permanent and total disability of a person
within the meaning of Section 22(e)(3) of the Code.

         (l)      "EMPLOYEE" means any person employed by the Company or an
Affiliate. Mere service as a Director or payment of a director's fee by the
Company or an Affiliate shall not be sufficient to constitute "employment" by
the Company or an Affiliate.

         (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 determined as follows:

                  (i)      If the Common Stock is listed on any established
stock exchange or traded on the Nasdaq National Market or the Nasdaq SmallCap
Market, the Fair Market Value of a share of Common Stock shall be the closing
sales price for such stock (or the closing bid, if no sales were reported) as
quoted on such exchange or market (or the exchange or market with the

                                       2.

<PAGE>

greatest volume of trading in the Common Stock) on the last market trading day
prior to the day of determination, as reported in The Wall Street Journal or
such other source as the Board deems reliable.

                  (ii)     In the absence of such markets for the Common Stock,
the Fair Market Value shall be determined in good faith by the Board.

                  (iii)    Prior to the Listing Date, the value of the Common
Stock shall be determined in a manner consistent with Section 260.140.50 of
Title 10 of the California Code of Regulations.

         (o)      "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.

         (p)      "LISTING DATE" means the first date upon which any security of
the Company is listed (or approved for listing) upon notice of issuance on any
securities exchange or designated (or approved for designation) upon notice of
issuance as a national market security on an interdealer quotation system if
such securities exchange or interdealer quotation system has been certified in
accordance with the provisions of Section 25100(o) of the California Corporate
Securities Law of 1968.

         (q)      "NON-EMPLOYEE DIRECTOR" means a Director who either (i) is not
a current Employee or Officer of the Company or its parent or a subsidiary, does
not receive compensation (directly or indirectly) from the Company or its parent
or a subsidiary for services rendered as a consultant or in any capacity other
than as a Director (except for an amount as to which disclosure would not be
required under Item 404(a) of Regulation S-K promulgated pursuant to the
Securities Act ("Regulation S-K")), does not possess an interest in any other
transaction as to which disclosure would be required under Item 404(a) of
Regulation S-K and is not engaged in a business relationship as to which
disclosure would be required under Item 404(b) of Regulation S-K; or (ii) is
otherwise considered a "non-employee director" for purposes of Rule 16b-3.

         (r)      "NONSTATUTORY STOCK OPTION" means an Option not intended to
qualify as an Incentive Stock Option.

         (s)      "OFFICER" means (i) before the Listing Date, any person
designated by the Company as an officer and (ii) on and after the Listing Date,
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.

         (t)      "OPTION" means an Incentive Stock Option or a Nonstatutory
Stock Option granted pursuant to the Plan.

         (u)      "OPTION AGREEMENT" means a written agreement between the
Company and an Optionholder evidencing the terms and conditions of an individual
Option grant. Each Option Agreement shall be subject to the terms and conditions
of the Plan.

                                       3.

<PAGE>

         (v)      "OPTIONHOLDER" means a person to whom an Option is granted
pursuant to the Plan or, if applicable, such other person who holds an
outstanding Option.

         (w)      "OUTSIDE DIRECTOR" means a Director who either (i) is not a
current employee of the Company or an "affiliated corporation" (within the
meaning of Treasury Regulations promulgated under Section 162(m) of the Code),
is not a former employee of the Company or an "affiliated corporation" receiving
compensation for prior services (other than benefits under a tax qualified
pension plan), was not an officer of the Company or an "affiliated corporation"
at any time and is not currently receiving direct or indirect remuneration from
the Company or an "affiliated corporation" for services in any capacity other
than as a Director or (ii) is otherwise considered an "outside director" for
purposes of Section 162(m) of the Code.

         (x)      "PARTICIPANT" means a person to whom a Stock Award is granted
pursuant to the Plan or, if applicable, such other person who holds an
outstanding Stock Award.

         (y)      "PLAN" means this Rhapsody Networks, Inc. 2000 Equity
Incentive Plan.

         (z)      "RULE 16b-3" means Rule 16b-3 promulgated under the Exchange
Act or any successor to Rule 16b-3, as in effect from time to time.

         (aa)     "SECURITIES ACT" means the Securities Act of 1933, as amended.

         (bb)     "STOCK AWARD" means any right granted under the Plan,
including an Option, a stock bonus and a right to acquire restricted stock.

         (cc)     "STOCK AWARD AGREEMENT" means a written agreement between the
Company and a holder of a Stock Award evidencing the terms and conditions of an
individual Stock Award grant. Each Stock Award Agreement shall be subject to the
terms and conditions of the Plan.

         (dd)     "TEN PERCENT STOCKHOLDER" means a person who 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.

3.       ADMINISTRATION.{TC}

         (a)      ADMINISTRATION BY BOARD. The Board shall administer the Plan
unless and until the Board delegates administration to a Committee, as provided
in subsection 3(c).

         (b)      POWERS OF BOARD. The Board shall have the power, subject to,
and within the limitations of, the express provisions of the Plan:

                  (i)      To determine from time to time which of the persons
eligible under the Plan shall be granted Stock Awards; when and how each Stock
Award shall be granted; what type or combination of types of Stock Award shall
be granted; the provisions of each Stock Award granted (which need not be
identical), including the time or times when a person shall be permitted to
receive Common Stock pursuant to a Stock Award; and the number of shares of
Common Stock with respect to which a Stock Award shall be granted to each such
person.

                                       4.

<PAGE>

                  (ii)     To construe and interpret the Plan and Stock Awards
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 Stock Award 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 or a Stock Award as provided in
Section 12.

                  (iv)     Generally, to exercise such powers and to perform
such acts as the Board deems necessary or expedient to promote the best
interests of the Company which are not in conflict with the provisions of the
Plan.

         (C)      DELEGATION TO COMMITTEE.

                  (i)      GENERAL. The Board may delegate administration of the
Plan to a Committee or Committees of one (1) or more members of the Board, and
the term "Committee" shall apply to any person or persons to whom such authority
has been delegated. 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, including the power to delegate to a
subcommittee any of the administrative powers the Committee is authorized to
exercise (and references in this Plan to the Board shall thereafter be to the
Committee or subcommittee), 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.

                  (ii)     COMMITTEE COMPOSITION WHEN COMMON STOCK IS PUBLICLY
TRADED. At such time as the Common Stock is publicly traded, in the discretion
of the Board, a Committee may consist solely of two or more Outside Directors,
in accordance with Section 162(m) of the Code, and/or solely of two or more
Non-Employee Directors, in accordance with Rule 16b-3. Within the scope of such
authority, the Board or the Committee may (1) delegate to a committee of one or
more members of the Board who are not Outside Directors the authority to grant
Stock Awards to eligible persons who are either (a) not then Covered Employees
and are not expected to be Covered Employees at the time of recognition of
income resulting from such Stock Award or (b) not persons with respect to whom
the Company wishes to comply with Section 162(m) of the Code and/or) (2)
delegate to a committee of one or more members of the Board who are not
Non-Employee Directors the authority to grant Stock Awards to eligible persons
who are not then subject to Section 16 of the Exchange Act.

         (d)      EFFECT OF BOARD'S DECISION. All determinations,
interpretations and constructions made by the Board in good faith shall not be
subject to review by any person and shall be final, binding and conclusive on
all persons.

4.       SHARES SUBJECT TO THE PLAN.{TC}

         (a)      SHARE RESERVE. Subject to the provisions of Section 11
relating to adjustments upon changes in Common Stock, the Common Stock that may
be issued pursuant to Stock Awards shall not exceed in the aggregate twenty one
million three hundred four thousand four hundred seventy one (21,304,471) shares
of Common Stock.

                                       5.

<PAGE>

         (b)      REVERSION OF SHARES TO THE SHARE RESERVE. If any Stock Award
shall for any reason expire or otherwise terminate, in whole or in part, without
having been exercised in full, the shares of Common Stock not acquired under
such Stock Award shall revert to and again become available for issuance under
the Plan.

         (c)      SOURCE OF SHARES. The shares of Common Stock subject to the
Plan may be unissued shares or reacquired shares, bought on the market or
otherwise.

         (d)      SHARE RESERVE LIMITATION. Prior to the Listing Date and to the
extent then required by Section 260.140.45 of Title 10 of the California Code of
Regulations, the total number of shares of Common Stock issuable upon exercise
of all outstanding Options and the total number of shares of Common Stock
provided for under any stock bonus or similar plan of the Company shall not
exceed the applicable percentage as calculated in accordance with the conditions
and exclusions of Section 260.140.45 of Title 10 of the California Code of
Regulations, based on the shares of Common Stock of the Company that are
outstanding at the time the calculation is made.(1)

5.       ELIGIBILITY.{TC}

         (a)      ELIGIBILITY FOR SPECIFIC STOCK AWARDS. Incentive Stock Options
may be granted only to Employees. Stock Awards other than Incentive Stock
Options may be granted to Employees, Directors and Consultants.

         (b)      TEN PERCENT STOCKHOLDERS.

                  (i)      A Ten Percent Stockholder shall not be granted an
Incentive Stock Option unless the exercise price of such Option is at least one
hundred ten percent (110%) of the Fair Market Value of the Common Stock at the
date of grant and the Option is not exercisable after the expiration of five (5)
years from the date of grant.

                  (ii)     Prior to the Listing Date, a Ten Percent Stockholder
shall not be granted a Nonstatutory Stock Option unless the exercise price of
such Option is at least (i) one hundred ten percent (110%) of the Fair Market
Value of the Common Stock at the date of grant or (ii) such lower percentage of
the Fair Market Value of the Common Stock at the date of grant as is permitted
by Section 260.140.41 of Title 10 of the California Code of Regulations at the
time of the grant of the Option.

                  (iii)    Prior to the Listing Date, a Ten Percent Stockholder
shall not be granted a restricted stock award unless the purchase price of the
restricted stock is at least (i) one hundred percent (100%) of the Fair Market
Value of the Common Stock at the date of grant or (ii) such lower percentage of
the Fair Market Value of the Common Stock at the date of grant as is

------------------------------
(1)      Section 260.140.45 generally provides that the total number of shares
issuable upon exercise of all outstanding options (exclusive of certain rights)
and the total number of shares called for under any stock bonus or similar plan
shall not exceed a number of shares which is equal to 30% of the then
outstanding shares of the issuer (convertible preferred or convertible senior
common shares counted on an as if converted basis), exclusive of shares subject
to promotional waivers under Section 260.141, unless a percentage higher than
30% is approved by at least two-thirds of the outstanding shares entitled to
vote.

                                       6.

<PAGE>

permitted by Section 260.140.41 of Title 10 of the California Code of
Regulations at the time of the grant of the Option.

         (c)      SECTION 162(m) LIMITATION. Subject to the provisions of
Section 11 relating to adjustments upon changes in the shares of Common Stock,
no Employee shall be eligible to be granted Options covering more than two
million eight hundred twenty-three thousand (2,823,000) shares of Common Stock
during any calendar year. This subsection 5(c) shall not apply prior to the
Listing Date and, following the Listing Date, this subsection 5(c) shall not
apply until (i) the earliest of: (1) the first material modification of the Plan
(including any increase in the number of shares of Common Stock reserved for
issuance under the Plan in accordance with Section 4); (2) the issuance of all
of the shares of Common Stock reserved for issuance under the Plan; (3) the
expiration of the Plan; or (4) the first meeting of stockholders at which
Directors are to be elected that occurs after the close of the third calendar
year following the calendar year in which occurred the first registration of an
equity security under Section 12 of the Exchange Act; or (ii) such other date
required by Section 162(m) of the Code and the rules and regulations promulgated
thereunder.

         (d)      CONSULTANTS.

                  (i)      Prior to the Listing Date, a Consultant shall not be
eligible for the grant of a Stock Award if, at the time of grant, either the
offer or the sale of the Company's securities to such Consultant is not exempt
under Rule 701 of the Securities Act ("Rule 701") because of the nature of the
services that the Consultant is providing to the Company, or because the
Consultant is not a natural person, or as otherwise provided by Rule 701, unless
the Company determines that such grant need not comply with the requirements of
Rule 701 and will satisfy another exemption under the Securities Act as well as
comply with the securities laws of all other relevant jurisdictions.

                  (ii)     From and after the Listing Date, a Consultant shall
not be eligible for the grant of a Stock Award if, at the time of grant, a Form
S-8 Registration Statement under the Securities Act ("Form S-8") is not
available to register either the offer or the sale of the Company's securities
to such Consultant because of the nature of the services that the Consultant is
providing to the Company, or because the Consultant is not a natural person, or
as otherwise provided by the rules governing the use of Form S-8, unless the
Company determines both (i) that such grant (A) shall be registered in another
manner under the Securities Act (e.g., on a Form S-3 Registration Statement) or
(B) does not require registration under the Securities Act in order to comply
with the requirements of the Securities Act, if applicable, and (ii) that such
grant complies with the securities laws of all other relevant jurisdictions.

6.       OPTION PROVISIONS.{TC}

         Each Option shall be in such form and shall contain such terms and
conditions as the Board shall deem appropriate. All Options shall be separately
designated Incentive Stock Options or Nonstatutory Stock Options at the time of
grant, and, if certificates are issued, a separate certificate or certificates
will be issued for shares of Common Stock purchased on exercise of each type of
Option. The provisions of separate Options need not be identical, but

                                       7.

<PAGE>

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. Subject to the provisions of subsection 5(b) regarding
Ten Percent Stockholders, no Option granted prior to the Listing Date shall be
exercisable after the expiration of ten (10) years from the date it was granted,
and no Incentive Stock Option granted on or after the Listing Date shall be
exercisable after the expiration of ten (10) years from the date it was granted.

         (b)      EXERCISE PRICE OF AN INCENTIVE STOCK OPTION. Subject to the
provisions of subsection 5(b) regarding Ten Percent Stockholders, the exercise
price of each Incentive Stock Option shall be not less than one hundred percent
(100%) of the Fair Market Value of the Common Stock subject to the Option on the
date the Option is granted. Notwithstanding the foregoing, an Incentive Stock
Option may be granted with an exercise price lower than that set forth in the
preceding sentence if such Option is granted pursuant to an assumption or
substitution for another option in a manner satisfying the provisions of Section
424(a) of the Code.

         (c)      EXERCISE PRICE OF A NONSTATUTORY STOCK OPTION. Subject to the
provisions of subsection 5(b) regarding Ten Percent Stockholders, the exercise
price of each Nonstatutory Stock Option shall be not less than eighty-five
percent (85%) of the Fair Market Value of the Common Stock subject to the Option
on the date the Option is granted. Notwithstanding the foregoing, a Nonstatutory
Stock Option may be granted with an exercise price lower than that set forth in
the preceding sentence if such Option is granted pursuant to an assumption or
substitution for another option in a manner satisfying the provisions of Section
424(a) of the Code.

         (d)      CONSIDERATION. The purchase price of Common Stock acquired
pursuant to an Option shall be paid, to the extent permitted by applicable
statutes and regulations, either (i) in cash at the time the Option is exercised
or (ii) at the discretion of the Board at the time of the grant of the Option
(or subsequently in the case of a Nonstatutory Stock Option) (1) by delivery to
the Company of other Common Stock, (2) according to a deferred payment or other
similar arrangement with the Optionholder or (3) in any other form of legal
consideration that may be acceptable to the Board. Unless otherwise specifically
provided in the Option, the purchase price of Common Stock acquired pursuant to
an Option that is paid by delivery to the Company of other Common Stock
acquired, directly or indirectly from the Company, shall be paid only by shares
of the Common Stock of the Company that have been held for more than six (6)
months (or such longer or shorter period of time required to avoid a charge to
earnings for financial accounting purposes). At any time that the Company is
incorporated in Delaware, payment of the Common Stock's "par value," as defined
in the Delaware General Corporation Law, shall not be made by deferred payment.

         In the case of any deferred payment arrangement, interest shall be
compounded at least annually and shall be charged at the minimum rate of
interest necessary to avoid the treatment as interest, under any applicable
provisions of the Code, of any amounts other than amounts stated to be interest
under the deferred payment arrangement.

                                       8.

<PAGE>

         (e)      TRANSFERABILITY OF AN INCENTIVE STOCK OPTION. 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
Optionholder only by the Optionholder. Notwithstanding the foregoing, the
Optionholder may, by delivering written notice to the Company, in a form
satisfactory to the Company, designate a third party who, in the event of the
death of the Optionholder, shall thereafter be entitled to exercise the Option.

         (f)      TRANSFERABILITY OF A NONSTATUTORY STOCK OPTION. A Nonstatutory
Stock Option granted prior to the Listing Date shall not be transferable except
by will or by the laws of descent and distribution and, to the extent provided
in the Option Agreement, to such further extent as permitted by Section
260.140.41(d) of Title 10 of the California Code of Regulations at the time of
the grant of the Option, and shall be exercisable during the lifetime of the
Optionholder only by the Optionholder. A Nonstatutory Stock Option granted on or
after the Listing Date shall be transferable to the extent provided in the
Option Agreement. If the Nonstatutory Stock Option does not provide for
transferability, then the Nonstatutory 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 Optionholder only by the Optionholder.
Notwithstanding the foregoing, the Optionholder may, by delivering written
notice to the Company, in a form satisfactory to the Company, designate a third
party who, in the event of the death of the Optionholder, shall thereafter be
entitled to exercise the Option.

         (g)      VESTING GENERALLY. The total number of shares of Common Stock
subject to an Option may, but need not, vest and therefore become exercisable in
periodic installments that may, but need not, be equal. The Option may be
subject to such other terms and conditions on the time or times when it may be
exercised (which may be based on performance or other criteria) as the Board may
deem appropriate. The vesting provisions of individual Options may vary. The
provisions of this subsection 6(g) are subject to any Option provisions
governing the minimum number of shares of Common Stock as to which an Option may
be exercised.

         (h)      MINIMUM VESTING PRIOR TO THE LISTING DATE. Notwithstanding the
foregoing subsection 6(g), to the extent that the following restrictions on
vesting are required by Section 260.140.41(f) of Title 10 of the California Code
of Regulations at the time of the grant of the Option, then:

                  (i)      Options granted prior to the Listing Date to an
Employee who is not an Officer, Director or Consultant shall provide for vesting
of the total number of shares of Common Stock at a rate of at least twenty
percent (20%) per year over five (5) years from the date the Option was granted,
subject to reasonable conditions such as continued employment; and

                  (ii)     Options granted prior to the Listing Date to Officers
, Directors or Consultants may be made fully exercisable, subject to reasonable
conditions such as continued employment, at any time or during any period
established by the Company.

         (i)      TERMINATION OF CONTINUOUS SERVICE. In the event an
Optionholder's Continuous Service terminates (other than upon the Optionholder's
death or Disability), the Optionholder may exercise his or her Option (to the
extent that the Optionholder was entitled to exercise such

                                       9.

<PAGE>

Option as of the date of termination) but only within such period of time ending
on the earlier of (i) the date three (3) months following the termination of the
Optionholder's Continuous Service (or such longer or shorter period specified in
the Option Agreement, which period shall not be less than thirty (30) days for
Options granted prior to the Listing Date unless such termination is for cause),
or (ii) the expiration of the term of the Option as set forth in the Option
Agreement. If, after termination, the Optionholder does not exercise his or her
Option within the time specified in the Option Agreement, the Option shall
terminate.

         (j)      EXTENSION OF TERMINATION DATE. An Optionholder's Option
Agreement may also provide that if the exercise of the Option following the
termination of the Optionholder's Continuous Service (other than upon the
Optionholder's death or Disability) would be prohibited at any time solely
because the issuance of shares of Common Stock would violate the registration
requirements under the Securities Act, then the Option shall terminate on the
earlier of (i) the expiration of the term of the Option set forth in subsection
6(a) or (ii) the expiration of a period of three (3) months after the
termination of the Optionholder's Continuous Service during which the exercise
of the Option would not be in violation of such registration requirements.

         (k)      DISABILITY OF OPTIONHOLDER. In the event that an
Optionholder's Continuous Service terminates as a result of the Optionholder's
Disability, the Optionholder may exercise his or her Option (to the extent that
the Optionholder was entitled to exercise such Option as of the date of
termination), but only within such period of time ending on the earlier of (i)
the date twelve (12) months following such termination (or such longer or
shorter period specified in the Option Agreement, which period shall not be less
than six (6) months for Options granted prior to the Listing Date) or (ii) the
expiration of the term of the Option as set forth in the Option Agreement. If,
after termination, the Optionholder does not exercise his or her Option within
the time specified herein, the Option shall terminate.

         (l)      DEATH OF OPTIONHOLDER. In the event (i) an Optionholder's
Continuous Service terminates as a result of the Optionholder's death or (ii)
the Optionholder dies within the period (if any) specified in the Option
Agreement after the termination of the Optionholder's Continuous Service for a
reason other than death, then the Option may be exercised (to the extent the
Optionholder was entitled to exercise such Option as of the date of death) by
the Optionholder's estate, by a person who acquired the right to exercise the
Option by bequest or inheritance or by a person designated to exercise the
option upon the Optionholder's death pursuant to subsection 6(e) or 6(f), but
only within the period ending on the earlier of (1) the date eighteen (18)
months following the date of death (or such longer or shorter period specified
in the Option Agreement, which period shall not be less than six (6) months for
Options granted prior to the Listing Date) or (2) the expiration of the term of
such Option as set forth in the Option Agreement. If, after death, the Option is
not exercised within the time specified herein, the Option shall terminate.

         (m)      EARLY EXERCISE. The Option may, but need not, include a
provision whereby the Optionholder may elect at any time before the
Optionholder's Continuous Service terminates to exercise the Option as to any
part or all of the shares of Common Stock subject to the Option prior to the
full vesting of the Option. Subject to the "Repurchase Limitation" in subsection
10(h), any unvested shares of Common Stock so purchased may be subject to a
repurchase

                                       10.

<PAGE>

option in favor of the Company or to any other restriction the Board determines
to be appropriate.

         (n)      RIGHT OF REPURCHASE. Subject to the "Repurchase Limitation" in
subsection 10(h), the Option may, but need not, include a provision whereby the
Company may elect, prior to the Listing Date, to repurchase all or any part of
the vested shares of Common Stock acquired by the Optionholder pursuant to the
exercise of the Option.

         (o)      RIGHT OF FIRST REFUSAL. The Option may, but need not, include
a provision whereby the Company may elect, prior to the Listing Date, to
exercise a right of first refusal following receipt of notice from the
Optionholder of the intent to transfer all or any part of the shares of Common
Stock received upon the exercise of the Option. Except as expressly provided in
this subsection 6(o), such right of first refusal shall otherwise comply with
any applicable provisions of the Bylaws of the Company.

7.       PROVISIONS OF STOCK AWARDS OTHER THAN OPTIONS.{TC}

         (a)      STOCK BONUS AWARDS. Each stock bonus agreement shall be in
such form and shall contain such terms and conditions as the Board shall deem
appropriate. The terms and conditions of stock bonus agreements may change from
time to time, and the terms and conditions of separate stock bonus agreements
need not be identical, but each stock bonus agreement shall include (through
incorporation of provisions hereof by reference in the agreement or otherwise)
the substance of each of the following provisions:

                  (i)      CONSIDERATION. A stock bonus may be awarded in
consideration for past services actually rendered to the Company or an Affiliate
for its benefit.

                  (ii)     VESTING. Subject to the "Repurchase Limitation" in
subsection 10(h), shares of Common Stock awarded under the stock bonus agreement
may, but need not, be subject to a share repurchase option in favor of the
Company in accordance with a vesting schedule to be determined by the Board.

                  (iii)    TERMINATION OF PARTICIPANT'S CONTINUOUS SERVICE.
Subject to the "Repurchase Limitation" in subsection 10(h), in the event a
Participant's Continuous Service terminates, the Company may reacquire any or
all of the shares of Common Stock held by the Participant which have not vested
as of the date of termination under the terms of the stock bonus agreement.

                  (iv)     TRANSFERABILITY. For a stock bonus award made before
the Listing Date, rights to acquire shares of Common Stock under the stock bonus
agreement shall not be transferable except by will or by the laws of descent and
distribution and shall be exercisable during the lifetime of the Participant
only by the Participant. For a stock bonus award made on or after the Listing
Date, rights to acquire shares of Common Stock under the stock bonus agreement
shall be transferable by the Participant only upon such terms and conditions as
are set forth in the stock bonus agreement, as the Board shall determine in its
discretion, so long as Common Stock awarded under the stock bonus agreement
remains subject to the terms of the stock bonus agreement.

                                       11.

<PAGE>

         (b)      RESTRICTED STOCK AWARDS. Each restricted stock purchase
agreement shall be in such form and shall contain such terms and conditions as
the Board shall deem appropriate. The terms and conditions of the restricted
stock purchase agreements may change from time to time, and the terms and
conditions of separate restricted stock purchase agreements need not be
identical, but each restricted stock purchase agreement shall include (through
incorporation of provisions hereof by reference in the agreement or otherwise)
the substance of each of the following provisions:

                  (i)      PURCHASE PRICE. Subject to the provisions of
subsection 5(b) regarding Ten Percent Stockholders, the purchase price under
each restricted stock purchase agreement shall not be less than eighty-five
percent (85%) of the Common Stock's Fair Market Value on the date such award is
made or at the time the purchase is consummated.

                  (ii)     CONSIDERATION. The purchase price of Common Stock
acquired pursuant to the restricted stock purchase agreement shall be paid
either: (i) in cash at the time of purchase; (ii) at the discretion of the
Board, according to a deferred payment or other similar arrangement with the
Participant; or (iii) in any other form of legal consideration that may be
acceptable to the Board in its discretion; provided, however, that at any time
that the Company is incorporated in Delaware, then payment of the Common Stock's
"par value," as defined in the Delaware General Corporation Law, shall not be
made by deferred payment.

                  (iii)    VESTING. Subject to the "Repurchase Limitation" in
subsection 10(h), shares of Common Stock acquired under the restricted stock
purchase agreement may, but need not, be subject to a share repurchase option in
favor of the Company in accordance with a vesting schedule to be determined by
the Board.

                  (iv)     TERMINATION OF PARTICIPANT'S CONTINUOUS SERVICE.
Subject to the "Repurchase Limitation" in subsection 10(h), in the event a
Participant's Continuous Service terminates, the Company may repurchase or
otherwise reacquire any or all of the shares of Common Stock held by the
Participant which have not vested as of the date of termination under the terms
of the restricted stock purchase agreement.

                  (v)      TRANSFERABILITY. For a restricted stock award made
before the Listing Date, rights to acquire shares of Common Stock under the
restricted stock purchase agreement shall not be transferable except by will or
by the laws of descent and distribution and shall be exercisable during the
lifetime of the Participant only by the Participant. For a restricted stock
award made on or after the Listing Date, rights to acquire shares of Common
Stock under the restricted stock purchase agreement shall be transferable by the
Participant only upon such terms and conditions as are set forth in the
restricted stock purchase agreement, as the Board shall determine in its
discretion, so long as Common Stock awarded under the restricted stock purchase
agreement remains subject to the terms of the restricted stock purchase
agreement.

8.       COVENANTS OF THE COMPANY.{TC}

         (a)      AVAILABILITY OF SHARES. During the terms of the Stock Awards,
the Company shall keep available at all times the number of shares of Common
Stock required to satisfy such Stock Awards.

                                       12.

<PAGE>

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

9.       USE OF PROCEEDS FROM STOCK.{TC}

         Proceeds from the sale of Common Stock pursuant to Stock Awards shall
constitute general funds of the Company.

10.      MISCELLANEOUS.{TC}

         (a)      ACCELERATION OF EXERCISABILITY AND VESTING. The Board shall
have the power to accelerate the time at which a Stock Award may first be
exercised or the time during which a Stock Award or any part thereof will vest
in accordance with the Plan, notwithstanding the provisions in the Stock Award
stating the time at which it may first be exercised or the time during which it
will vest.

         (b)      STOCKHOLDER RIGHTS. No Participant shall be deemed to be the
holder of, or to have any of the rights of a holder with respect to, any shares
of Common Stock subject to such Stock Award unless and until such Participant
has satisfied all requirements for exercise of the Stock Award pursuant to its
terms.

         (c)      NO EMPLOYMENT OR OTHER SERVICE RIGHTS. Nothing in the Plan or
any instrument executed or Stock Award granted pursuant thereto shall confer
upon any Participant any right to continue to serve the Company or an Affiliate
in the capacity in effect at the time the Stock Award was granted or shall
affect the right of the Company or an Affiliate to terminate (i) the employment
of an Employee with or without notice and with or without cause, (ii) the
service of a Consultant pursuant to the terms of such Consultant's agreement
with the Company or an Affiliate or (iii) the service of a Director pursuant to
the Bylaws of the Company or an Affiliate, and any applicable provisions of the
corporate law of the state in which the Company or the Affiliate is
incorporated, as the case may be.

         (d)      INCENTIVE STOCK OPTION $100,000 LIMITATION. To the extent that
the aggregate Fair Market Value (determined at the time of grant) of Common
Stock with respect to which Incentive Stock Options are exercisable for the
first time by any Optionholder 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.

         (e)      INVESTMENT ASSURANCES. The Company may require a Participant,
as a condition of exercising or acquiring Common Stock under any Stock Award,
(i) to give written assurances

                                       13.

<PAGE>

satisfactory to the Company as to the Participant's knowledge and experience in
financial and business matters and/or to employ a purchaser representative
reasonably satisfactory to the Company who is knowledgeable and experienced in
financial and business matters and that he or she is capable of evaluating,
alone or together with the purchaser representative, the merits and risks of
exercising the Stock Award; and (ii) to give written assurances satisfactory to
the Company stating that the Participant is acquiring Common Stock subject to
the Stock Award for the Participant's own account and not with any present
intention of selling or otherwise distributing the Common Stock. The foregoing
requirements, and any assurances given pursuant to such requirements, shall be
inoperative if (1) the issuance of the shares of Common Stock upon the exercise
or acquisition of Common Stock under the Stock Award has been registered under a
then currently effective registration statement under the Securities Act or (2)
as to any particular requirement, a determination is made by counsel for the
Company that such requirement need not be met in the circumstances under the
then applicable securities laws. The Company may, upon advice of counsel to the
Company, place legends on stock certificates issued under the Plan as such
counsel deems necessary or appropriate in order to comply with applicable
securities laws, including, but not limited to, legends restricting the transfer
of the Common Stock.

         (f)      WITHHOLDING OBLIGATIONS. To the extent provided by the terms
of a Stock Award Agreement, the Participant may satisfy any federal, state or
local tax withholding obligation relating to the exercise or acquisition of
Common Stock under a Stock Award by any of the following means (in addition to
the Company's right to withhold from any compensation paid to the Participant by
the Company) or by a combination of such means: (i) tendering a cash payment;
(ii) authorizing the Company to withhold shares of Common Stock from the shares
of Common Stock otherwise issuable to the Participant as a result of the
exercise or acquisition of Common Stock under the Stock Award, provided,
however, that no shares of Common Stock are withheld with a value exceeding the
minimum amount of tax required to be withheld by law; or (iii) delivering to the
Company owned and unencumbered shares of Common Stock.

         (g)      INFORMATION OBLIGATION. Prior to the Listing Date, to the
extent required by Section 260.140.46 of Title 10 of the California Code of
Regulations, the Company shall deliver financial statements to Participants at
least annually. This subsection 10(g) shall not apply to key Employees whose
duties in connection with the Company assure them access to equivalent
information.

         (h)      REPURCHASE LIMITATION. The terms of any repurchase option
shall be specified in the Stock Award and may be either at Fair Market Value at
the time of repurchase or at not less than the original purchase price. To the
extent required by Section 260.140.41 and Section 260.140.42 of Title 10 of the
California Code of Regulations at the time a Stock Award is made, any repurchase
option contained in a Stock Award granted prior to the Listing Date to a person
who is not an Officer, Director or Consultant shall be upon the terms described
below:

                  (i)      FAIR MARKET VALUE. If the repurchase option gives the
Company the right to repurchase the shares of Common Stock upon termination of
employment at not less than the Fair Market Value of the shares of Common Stock
to be purchased on the date of termination of Continuous Service, then (i) the
right to repurchase shall be exercised for cash or cancellation of purchase
money indebtedness for the shares of Common Stock within ninety (90) days of

                                       14.

<PAGE>

termination of Continuous Service (or in the case of shares of Common Stock
issued upon exercise of Stock Awards after such date of termination, within
ninety (90) days after the date of the exercise) or such longer period as may be
agreed to by the Company and the Participant (for example, for purposes of
satisfying the requirements of Section 1202(c)(3) of the Code regarding
"qualified small business stock") and (ii) the right terminates when the shares
of Common Stock become publicly traded.

                  (ii)     ORIGINAL PURCHASE PRICE. If the repurchase option
gives the Company the right to repurchase the shares of Common Stock upon
termination of Continuous Service at the original purchase price, then (i) the
right to repurchase at the original purchase price shall lapse at the rate of at
least twenty percent (20%) of the shares of Common Stock per year over five (5)
years from the date the Stock Award is granted (without respect to the date the
Stock Award was exercised or became exercisable) and (ii) the right to
repurchase shall be exercised for cash or cancellation of purchase money
indebtedness for the shares of Common Stock within ninety (90) days of
termination of Continuous Service (or in the case of shares of Common Stock
issued upon exercise of Options after such date of termination, within ninety
(90) days after the date of the exercise) or such longer period as may be agreed
to by the Company and the Participant (for example, for purposes of satisfying
the requirements of Section 1202(c)(3) of the Code regarding "qualified small
business stock").

11.      ADJUSTMENTS UPON CHANGES IN STOCK.{TC}

         (a)      CAPITALIZATION ADJUSTMENTS. If any change is made in the
Common Stock subject to the Plan, or subject to any Stock Award, without the
receipt of consideration by the Company (through merger, consolidation,
reorganization, recapitalization, reincorporation, stock dividend, dividend in
property other than cash, stock split, liquidating dividend, combination of
shares, exchange of shares, change in corporate structure or other transaction
not involving the receipt of consideration by the Company), the Plan will be
appropriately adjusted in the class(es) and maximum number of securities subject
to the Plan pursuant to subsection 4(a) and the maximum number of securities
subject to award to any person pursuant to subsection 5(c), and the outstanding
Stock Awards will be appropriately adjusted in the class(es) and number of
securities and price per share of Common Stock subject to such outstanding Stock
Awards. The Board shall make such adjustments, and its determination shall be
final, binding and conclusive. (The conversion of any convertible securities of
the Company shall not be treated as a transaction "without receipt of
consideration" by the Company.)

         (b)      DISSOLUTION OR LIQUIDATION. In the event of a dissolution or
liquidation of the Company, then all outstanding Stock Awards shall terminate
immediately prior to such event.

         (c)      CORPORATE TRANSACTION. In the event of a Corporate
Transaction, any surviving corporation or acquiring corporation may assume any
Stock Awards outstanding under the Plan or substitute similar stock awards
(including awards to acquire the same consideration paid to the stockholders in
the Corporate Transaction) for those outstanding under the Plan. In the event
any surviving corporation or acquiring corporation does not assume such Stock
Awards or substitute similar stock awards for those outstanding under the Plan,
then with respect to Stock Awards held by Participants whose Continuous Service
has not terminated, the vesting of such Stock Awards (and, if applicable, the
time during which such Stock Awards may be exercised) shall be

                                       15.

<PAGE>

accelerated in full, and the Stock Awards shall terminate if not exercised (if
applicable) at or prior to the Corporate Transaction. With respect to any other
Stock Awards outstanding under the Plan, such Stock Awards shall terminate if
not exercised (if applicable) prior to the Corporate Transaction.

         For purposes of the Plan, Corporate Transaction means that one of the
following has occurred: (i) a sale, lease or other disposition of all or
substantially all of the securities or assets of the Company, (ii) a merger or
consolidation in which the Company is not the surviving corporation or (iii) a
reverse merger in which the Company is the surviving corporation but the shares
of Common Stock outstanding immediately preceding the merger are converted by
virtue of the merger into other property, whether in the form of securities,
cash or otherwise.

12.      AMENDMENT OF THE PLAN AND STOCK AWARDS.{TC}

         (a)      AMENDMENT OF PLAN. The Board at any time, and from time to
time, may amend the Plan. However, except as provided in Section 11 relating to
adjustments upon changes in Common Stock, no amendment shall be effective unless
approved by the stockholders of the Company to the extent stockholder approval
is necessary to satisfy the requirements of Section 422 of the Code, Rule 16b-3
or any Nasdaq or securities exchange listing requirements.

         (b)      STOCKHOLDER APPROVAL. 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 thereunder regarding the
exclusion of performance-based compensation from the limit on corporate
deductibility of compensation paid to certain executive officers.

         (c)      CONTEMPLATED AMENDMENTS. It is expressly contemplated that the
Board may amend the Plan in any respect the Board deems necessary or advisable
to provide eligible Employees 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)      NO IMPAIRMENT OF RIGHTS. Rights under any Stock Award granted
before amendment of the Plan shall not be impaired by any amendment of the Plan
unless (i) the Company requests the consent of the Participant and (ii) the
Participant consents in writing.

         (e)      AMENDMENT OF STOCK AWARDS. The Board at any time, and from
time to time, may amend the terms of any one or more Stock Awards; provided,
however, that the rights under any Stock Award shall not be impaired by any such
amendment unless (i) the Company requests the consent of the Participant and
(ii) the Participant consents in writing.

13.      TERMINATION OR SUSPENSION OF THE PLAN.{TC}

         (a)      PLAN TERM. The Board may suspend or terminate the Plan at any
time. Unless sooner terminated, the Plan shall terminate on the day before the
tenth (10th) anniversary of the date the Plan is adopted by the Board or
approved by the stockholders of the Company, whichever is earlier. No Stock
Awards may be granted under the Plan while the Plan is suspended or after it is
terminated.

                                       16.

<PAGE>

         (b)      NO IMPAIRMENT OF RIGHTS. Suspension or termination of the Plan
shall not impair rights and obligations under any Stock Award granted while the
Plan is in effect except with the written consent of the Participant.

14.      EFFECTIVE DATE OF PLAN.{TC}

         The Plan shall become effective upon its adoption by the Board, but no
Stock Award shall be exercised (or, in the case of a stock bonus, shall be
granted) unless and until the Plan has been approved by the stockholders of the
Company, which approval shall be within twelve (12) months before or after the
date the Plan is adopted by the Board.

15.      CHOICE OF LAW.{TC}

         The law of the State of Delaware shall govern all questions concerning
the construction, validity and interpretation of this Plan, without regard to
such state's conflict of laws rules.

                                       17.

<PAGE>

                             RHAPSODY NETWORKS, INC.
                           2000 EQUITY INCENTIVE PLAN
                             STOCK OPTION AGREEMENT
              (INCENTIVE STOCK OPTION OR NONSTATUTORY STOCK OPTION)

Pursuant to your Stock Option Grant Notice ("Grant Notice") and this Stock
Option Agreement, Rhapsody Networks, Inc. (the "Company") has granted you an
option under its 2000 Equity Incentive Plan (the "Plan") to purchase the number
of shares of the Company's Common Stock indicated in your Grant Notice at the
exercise price indicated in your Grant Notice. Defined terms not explicitly
defined in this Stock Option Agreement but defined in the Plan shall have the
same definitions as in the Plan.

The details of your option are as follows:

         1.       VESTING. Subject to the limitations contained herein, your
                  option will vest as provided in your Grant Notice, provided
                  that vesting will cease upon the termination of your
                  Continuous Service.

         2.       NUMBER OF SHARES AND EXERCISE PRICE. The number of shares of
                  Common Stock subject to your option and your exercise price
                  per share referenced in your Grant Notice may be adjusted from
                  time to time for Capitalization Adjustments, as provided in
                  the Plan.

         3.       EXERCISE PRIOR TO VESTING ("EARLY EXERCISE"). If permitted in
                  your Grant Notice (i.e., the "Exercise Schedule" indicates
                  that "Early Exercise" of your option is permitted) and subject
                  to the provisions of your option, you may elect at any time
                  that is both (i) during the period of your Continuous Service
                  and (ii) during the term of your option, to exercise all or
                  part of your option, including the nonvested portion of your
                  option; provided, however, that:

                  a.       a partial exercise of your option shall be deemed to
                           cover first vested shares of Common Stock and then
                           the earliest vesting installment of unvested shares
                           of Common Stock;

                  b.       any shares of Common Stock so purchased from
                           installments that have not vested as of the date of
                           exercise shall be subject to the purchase option in
                           favor of the Company as described in the Company's
                           form of Early Exercise Stock Purchase Agreement;

                  c.       you shall enter into the Company's form of Early
                           Exercise Stock Purchase Agreement with a vesting
                           schedule that will result in the same vesting as if
                           no early exercise had occurred; and

                  d.       if your option is an incentive stock option, then, as
                           provided in the Plan, to the extent that the
                           aggregate Fair Market Value (determined at the time
                           of grant) of the shares of Common Stock with respect
                           to which your option plus all other incentive stock
                           options you hold are exercisable for the first

                                       18.

<PAGE>

                           time by you during any calendar year (under all plans
                           of the Company and its Affiliates) exceeds one
                           hundred thousand dollars ($100,000), your option(s)
                           or portions thereof that exceed such limit (according
                           to the order in which they were granted) shall be
                           treated as nonstatutory stock options.

         4.       METHOD OF PAYMENT. Payment of the exercise price is due in
                  full upon exercise of all or any part of your option. You may
                  elect to make payment of the exercise price in cash or by
                  check or in any other manner PERMITTED BY YOUR GRANT NOTICE,
                  which may include one or more of the following:

                  a.       In the Company's sole discretion at the time your
                           option is exercised and provided that at the time of
                           exercise the Common Stock is publicly traded and
                           quoted regularly in The Wall Street Journal, pursuant
                           to a program developed under Regulation T as
                           promulgated by the Federal Reserve Board that, prior
                           to the issuance of Common Stock, results in either
                           the receipt of cash (or check) by the Company or the
                           receipt of irrevocable instructions to pay the
                           aggregate exercise price to the Company from the
                           sales proceeds.

                  b.       Provided that at the time of exercise the Common
                           Stock is publicly traded and quoted regularly in The
                           Wall Street Journal, by delivery of already-owned
                           shares of Common Stock either that you have held for
                           the period required to avoid a charge to the
                           Company's reported earnings (generally six months) or
                           that you did not acquire, directly or indirectly from
                           the Company, that are owned free and clear of any
                           liens, claims, encumbrances or security interests,
                           and that are valued at Fair Market Value on the date
                           of exercise. "Delivery" for these purposes, in the
                           sole discretion of the Company at the time you
                           exercise your option, shall include delivery to the
                           Company of your attestation of ownership of such
                           shares of Common Stock in a form approved by the
                           Company. Notwithstanding the foregoing, you may not
                           exercise your option by tender to the Company of
                           Common Stock to the extent such tender would violate
                           the provisions of any law, regulation or agreement
                           restricting the redemption of the Company's stock.

                  c.       Pursuant to the following deferred payment
                           alternative:

                           1)       Not less than one hundred percent (100%) of
                                    the aggregate exercise price, plus accrued
                                    interest, shall be due four (4) years from
                                    date of exercise or, at the Company's
                                    election, upon termination of your
                                    Continuous Service.

                           2)       Interest shall be compounded at least
                                    annually and shall be charged at the minimum
                                    rate of interest necessary to avoid the
                                    treatment as interest, under any applicable
                                    provisions of the Code, of any portion of
                                    any amounts other than amounts stated to be
                                    interest under the deferred payment
                                    arrangement.

                                       19.

<PAGE>

                           3)       At any time that the Company is incorporated
                                    in Delaware, payment of the Common Stock's
                                    "par value," as defined in the Delaware
                                    General Corporation Law, shall be made in
                                    cash and not by deferred payment.

                           4)       In order to elect the deferred payment
                                    alternative, you must, as a part of your
                                    written notice of exercise, give notice of
                                    the election of this payment alternative
                                    and, in order to secure the payment of the
                                    deferred exercise price to the Company
                                    hereunder, if the Company so requests, you
                                    must tender to the Company a promissory note
                                    and a security agreement covering the
                                    purchased shares of Common Stock, both in
                                    form and substance satisfactory to the
                                    Company, or such other or additional
                                    documentation as the Company may request.

         5.       WHOLE SHARES. You may exercise your option only for whole
                  shares of Common Stock.

         6.       SECURITIES LAW COMPLIANCE. Notwithstanding anything to the
                  contrary contained herein, you may not exercise your option
                  unless the shares of Common Stock issuable upon such exercise
                  are then registered under the Securities Act or, if such
                  shares of Common Stock are not then so registered, the Company
                  has determined that such exercise and issuance would be exempt
                  from the registration requirements of the Securities Act. The
                  exercise of your option must also comply with other applicable
                  laws and regulations governing your option, and you may not
                  exercise your option if the Company determines that such
                  exercise would not be in material compliance with such laws
                  and regulations.

         7.       TERM. You may not exercise your option before the commencement
                  of its term or after its term expires. The term of your option
                  commences on the Date of Grant and expires upon the earliest
                  of the following:

                  a.       three (3) months after the termination of your
                           Continuous Service for any reason other than
                           Disability or death, provided that if during any part
                           of such three- (3-) month period you may not exercise
                           your option solely because of the condition set forth
                           in the preceding paragraph relating to "Securities
                           Law Compliance," your option shall not expire until
                           the earlier of the Expiration Date or until it shall
                           have been exercisable for an aggregate period of
                           three (3) months after the termination of your
                           Continuous Service;

                  b.       twelve (12) months after the termination of your
                           Continuous Service due to your Disability;

                  c.       eighteen (18) months after your death if you die
                           either during your Continuous Service or within three
                           (3) months after your Continuous Service terminates
                           for reason;

                                       20.

<PAGE>

                  d.       the Expiration Date indicated in your Grant Notice;
                           or

                  e.       the day before the tenth (10th) anniversary of the
                           Date of Grant.

If your option is an incentive stock option, note that, to obtain the federal
income tax advantages associated with an "incentive stock option," the Code
requires that at all times beginning on the date of grant of your option and
ending on the day three (3) months before the date of your option's exercise,
you must be an employee of the Company or an Affiliate, except in the event of
your death or Disability. The Company has provided for extended exercisability
of your option under certain circumstances for your benefit but cannot guarantee
that your option will necessarily be treated as an "incentive stock option" if
you continue to provide services to the Company or an Affiliate as a Consultant
or Director after your employment terminates or if you otherwise exercise your
option more than three (3) months after the date your employment terminates.

         8.       EXERCISE.

                  a.       You may exercise the vested portion of your option
                           (and the unvested portion of your option if your
                           Grant Notice so permits) during its term by
                           delivering a Notice of Exercise (in a form designated
                           by the Company) together with the exercise price to
                           the Secretary of the Company, or to such other person
                           as the Company may designate, during regular business
                           hours, together with such additional documents as the
                           Company may then require.

                  b.       By exercising your option you agree that, as a
                           condition to any exercise of your option, the Company
                           may require you to enter into an arrangement
                           providing for the payment by you to the Company of
                           any tax withholding obligation of the Company arising
                           by reason of (1) the exercise of your option, (2) the
                           lapse of any substantial risk of forfeiture to which
                           the shares of Common Stock are subject at the time of
                           exercise, or (3) the disposition of shares of Common
                           Stock acquired upon such exercise.

                  c.       If your option is an incentive stock option, by
                           exercising your option you agree that you will notify
                           the Company in writing within fifteen (15) days after
                           the date of any disposition of any of the shares of
                           the Common Stock issued upon exercise of your option
                           that occurs within two (2) years after the date of
                           your option grant or within one (1) year after such
                           shares of Common Stock are transferred upon exercise
                           of your option.

                  d.       By exercising your option you agree that the Company
                           (or a representative of the underwriter(s)) may, in
                           connection with the first underwritten registration
                           of the offering of any securities of the Company
                           under the Securities Act, require that you not sell,
                           dispose of, transfer, make any short sale of, grant
                           any option for the purchase of, or enter into any
                           hedging or similar transaction with the same economic
                           effect as a sale, any shares of Common Stock or other
                           securities of the Company held by you,

                                       21.

<PAGE>

                           for a period of time specified by the underwriter(s)
                           (not to exceed one hundred eighty (180) days)
                           following the effective date of the registration
                           statement of the Company filed under the Securities
                           Act. You further agree to execute and deliver such
                           other agreements as may be reasonably requested by
                           the Company and/or the underwriter(s) that are
                           consistent with the foregoing or that are necessary
                           to give further effect thereto. In order to enforce
                           the foregoing covenant, the Company may impose
                           stop-transfer instructions with respect to your
                           shares of Common Stock until the end of such period.
                           The underwriters of the Company's stock are intended
                           third party beneficiaries of this Section 8(d) and
                           shall have the right, power and authority to enforce
                           the provisions hereof as though they were a party
                           hereto.

         9.       TRANSFERABILITY. Your option is not transferable, except by
                  will or by the laws of descent and distribution, and is
                  exercisable during your life only by you. Notwithstanding the
                  foregoing, by delivering written notice to the Company, in a
                  form satisfactory to the Company, you may designate a third
                  party who, in the event of your death, shall thereafter be
                  entitled to exercise your option.

         10.      RIGHT OF FIRST REFUSAL. Shares of Common Stock that you
                  acquire upon exercise of your option are subject to any right
                  of first refusal that may be described in the Company's bylaws
                  in effect at such time the Company elects to exercise its
                  right. The Company's right of first refusal shall expire on
                  the Listing Date.

         11.      RIGHT OF REPURCHASE. To the extent provided in the Company's
                  bylaws as amended from time to time, the Company shall have
                  the right to repurchase all or any part of the shares of
                  Common Stock you acquire pursuant to the exercise of your
                  option.

         12.      OPTION NOT A SERVICE CONTRACT. Your option is not an
                  employment or service contract, and nothing in your option
                  shall be deemed to create in any way whatsoever any obligation
                  on your part to continue in the employ of the Company or an
                  Affiliate, or of the Company or an Affiliate to continue your
                  employment. In addition, nothing in your option shall obligate
                  the Company or an Affiliate, their respective shareholders,
                  Boards of Directors, Officers or Employees to continue any
                  relationship that you might have as a Director or Consultant
                  for the Company or an Affiliate.

         13.      WITHHOLDING OBLIGATIONS.

                  a.       At the time you exercise your option, in whole or in
                           part, or at any time thereafter as requested by the
                           Company, you hereby authorize withholding from
                           payroll and any other amounts payable to you, and
                           otherwise agree to make adequate provision for
                           (including by means of a "cashless exercise" pursuant
                           to a program developed under Regulation T as
                           promulgated by the Federal Reserve Board to the
                           extent permitted by the

                                       22.

<PAGE>

                           Company), any sums required to satisfy the federal,
                           state, local and foreign tax withholding obligations
                           of the Company or an Affiliate, if any, which arise
                           in connection with your option.

                  b.       Upon your request and subject to approval by the
                           Company, in its sole discretion, and compliance with
                           any applicable conditions or restrictions of law, the
                           Company may withhold from fully vested shares of
                           Common Stock otherwise issuable to you upon the
                           exercise of your option a number of whole shares of
                           Common Stock having a Fair Market Value, determined
                           by the Company as of the date of exercise, not in
                           excess of the minimum amount of tax required to be
                           withheld by law. If the date of determination of any
                           tax withholding obligation is deferred to a date
                           later than the date of exercise of your option, share
                           withholding pursuant to the preceding sentence shall
                           not be permitted unless you make a proper and timely
                           election under Section 83(b) of the Code, covering
                           the aggregate number of shares of Common Stock
                           acquired upon such exercise with respect to which
                           such determination is otherwise deferred, to
                           accelerate the determination of such tax withholding
                           obligation to the date of exercise of your option.
                           Notwithstanding the filing of such election, shares
                           of Common Stock shall be withheld solely from fully
                           vested shares of Common Stock determined as of the
                           date of exercise of your option that are otherwise
                           issuable to you upon such exercise. Any adverse
                           consequences to you arising in connection with such
                           share withholding procedure shall be your sole
                           responsibility.

                  c.       You may not exercise your option unless the tax
                           withholding obligations of the Company and/or any
                           Affiliate are satisfied. Accordingly, you may not be
                           able to exercise your option when desired even though
                           your option is vested, and the Company shall have no
                           obligation to issue a certificate for such shares of
                           Common Stock or release such shares of Common Stock
                           from any escrow provided for herein.

         14.      NOTICES. Any notices provided for in your option or the Plan
                  shall be given in writing and shall be deemed effectively
                  given upon receipt or, in the case of notices delivered by
                  mail by the Company to you, five (5) days after deposit in the
                  United States mail, postage prepaid, addressed to you at the
                  last address you provided to the Company.

         15.      GOVERNING PLAN DOCUMENT. Your option is subject to all the
                  provisions of the Plan, the provisions of which are hereby
                  made a part of your option, and is further subject to all
                  interpretations, amendments, rules and regulations which may
                  from time to time be promulgated and adopted pursuant to the
                  Plan. In the event of any conflict between the provisions of
                  your option and those of the Plan, the provisions of the Plan
                  shall control.

                                       23.

<PAGE>

                             RHAPSODY NETWORKS, INC.
                           2000 EQUITY INCENTIVE PLAN
                             STOCK OPTION AGREEMENT
                    WITH DOUBLE TRIGGER VESTING ACCELERATION
              (INCENTIVE STOCK OPTION OR NONSTATUTORY STOCK OPTION)

Pursuant to your Stock Option Grant Notice ("Grant Notice") and this Stock
Option Agreement, Rhapsody Networks, Inc. (the "Company") has granted you an
option under its 2000 Equity Incentive Plan (the "Plan") to purchase the number
of shares of the Company's Common Stock indicated in your Grant Notice at the
exercise price indicated in your Grant Notice. Defined terms not explicitly
defined in this Stock Option Agreement but defined in the Plan shall have the
same definitions as in the Plan.

The details of your option are as follows:

         1.   VESTING. Subject to the limitations contained herein and to
              Sections 9 and 10 below, your option will vest as provided in your
              Grant Notice, provided that vesting will cease upon the
              termination of your Continuous Service.

         2.   NUMBER OF SHARES AND EXERCISE PRICE. The number of shares of
                  Common Stock subject to your option and your exercise price
                  per share referenced in your Grant Notice may be adjusted from
                  time to time for Capitalization Adjustments, as provided in
                  the Plan.

         3.   EXERCISE PRIOR TO VESTING ("EARLY EXERCISE"). If permitted in
                  your Grant Notice (i.e., the "Exercise Schedule" indicates
                  that "Early Exercise" of your option is permitted) and subject
                  to the provisions of your option, you may elect at any time
                  that is both (i) during the period of your Continuous Service
                  and (ii) during the term of your option, to exercise all or
                  part of your option, including the nonvested portion of your
                  option; provided, however, that:

                  a.       a partial exercise of your option shall be deemed to
                           cover first vested shares of Common Stock and then
                           the earliest vesting installment of unvested shares
                           of Common Stock;

                  b.       any shares of Common Stock so purchased from
                           installments that have not vested as of the date of
                           exercise shall be subject to the purchase option in
                           favor of the Company as described in the Company's
                           form of Early Exercise Stock Purchase Agreement;

                  c.       you shall enter into the Company's form of Early
                           Exercise Stock Purchase Agreement with a vesting
                           schedule that will result in the same vesting as if
                           no early exercise had occurred; and

                  d.       if your option is an incentive stock option, then, as
                           provided in the Plan, to the extent that the
                           aggregate Fair Market Value (determined at the time
                           of

                                       24.

<PAGE>

                           grant) of the shares of Common Stock with respect to
                           which your option plus all other incentive stock
                           options you hold are exercisable for the first time
                           by you during any calendar year (under all plans of
                           the Company and its Affiliates) exceeds one hundred
                           thousand dollars ($100,000), your option(s) or
                           portions thereof that exceed such limit (according to
                           the order in which they were granted) shall be
                           treated as nonstatutory stock options.

         4.   METHOD OF PAYMENT. Payment of the exercise price is due in full
                  upon exercise of all or any part of your option. You may elect
                  to make payment of the exercise price in cash or by check or
                  in any other manner PERMITTED BY YOUR GRANT NOTICE, which may
                  include one or more of the following:

                  a.       In the Company's sole discretion at the time your
                           option is exercised and provided that at the time of
                           exercise the Common Stock is publicly traded and
                           quoted regularly in The Wall Street Journal, pursuant
                           to a program developed under Regulation T as
                           promulgated by the Federal Reserve Board that, prior
                           to the issuance of Common Stock, results in either
                           the receipt of cash (or check) by the Company or the
                           receipt of irrevocable instructions to pay the
                           aggregate exercise price to the Company from the
                           sales proceeds.

                  b.       Provided that at the time of exercise the Common
                           Stock is publicly traded and quoted regularly in The
                           Wall Street Journal, by delivery of already-owned
                           shares of Common Stock either that you have held for
                           the period required to avoid a charge to the
                           Company's reported earnings (generally six months) or
                           that you did not acquire, directly or indirectly from
                           the Company, that are owned free and clear of any
                           liens, claims, encumbrances or security interests,
                           and that are valued at Fair Market Value on the date
                           of exercise. "Delivery" for these purposes, in the
                           sole discretion of the Company at the time you
                           exercise your option, shall include delivery to the
                           Company of your attestation of ownership of such
                           shares of Common Stock in a form approved by the
                           Company. Notwithstanding the foregoing, you may not
                           exercise your option by tender to the Company of
                           Common Stock to the extent such tender would violate
                           the provisions of any law, regulation or agreement
                           restricting the redemption of the Company's stock.

                  c.       Pursuant to the following deferred payment
                           alternative:

                           i. Not less than one hundred percent (100%)
                                    of the aggregate exercise price, plus
                                    accrued interest, shall be due four (4)
                                    years from date of exercise or, at the
                                    Company's election, upon termination of your
                                    Continuous Service.

                           ii. Interest shall be compounded at least annually
                                    and shall be charged at the minimum rate of
                                    interest necessary to avoid the treatment as
                                    interest, under any applicable provisions of
                                    the Code, of any

                                       25.

<PAGE>

                                    portion of any amounts other than amounts
                                    stated to be interest under the deferred
                                    payment arrangement.

                           iii. At any time that the Company is incorporated in
                                    Delaware, payment of the Common Stock's "par
                                    value," as defined in the Delaware General
                                    Corporation Law, shall be made in cash and
                                    not by deferred payment.

                           iv. In order to elect the deferred payment
                                    alternative, you must, as a part of your
                                    written notice of exercise, give notice of
                                    the election of this payment alternative
                                    and, in order to secure the payment of the
                                    deferred exercise price to the Company
                                    hereunder, if the Company so requests, you
                                    must tender to the Company a promissory note
                                    and a security agreement covering the
                                    purchased shares of Common Stock, both in
                                    form and substance satisfactory to the
                                    Company, or such other or additional
                                    documentation as the Company may request.

         5.   WHOLE SHARES. You may exercise your option only for whole shares
                  of Common Stock.

         6.   SECURITIES LAW COMPLIANCE. Notwithstanding anything to the
                  contrary contained herein, you may not exercise your option
                  unless the shares of Common Stock issuable upon such exercise
                  are then registered under the Securities Act or, if such
                  shares of Common Stock are not then so registered, the Company
                  has determined that such exercise and issuance would be exempt
                  from the registration requirements of the Securities Act. The
                  exercise of your option must also comply with other applicable
                  laws and regulations governing your option, and you may not
                  exercise your option if the Company determines that such
                  exercise would not be in material compliance with such laws
                  and regulations.

         7.   TERM. You may not exercise your option before the commencement of
                  its term or after its term expires. The term of your option
                  commences on the Date of Grant and expires upon the EARLIEST
                  of the following:

                  a.       three (3) months after the termination of your
                           Continuous Service for any reason other than
                           Disability or death, provided that if during any part
                           of such three- (3-) month period you may not exercise
                           your option solely because of the condition set forth
                           in the preceding paragraph relating to "Securities
                           Law Compliance," your option shall not expire until
                           the earlier of the Expiration Date or until it shall
                           have been exercisable for an aggregate period of
                           three (3) months after the termination of your
                           Continuous Service;

                  b.       twelve (12) months after the termination of your
                           Continuous Service due to your Disability;

                                       26.

<PAGE>

                  c.       eighteen (18) months after your death if you die
                           either during your Continuous Service or within three
                           (3) months after your Continuous Service terminates
                           for reason;

                  d.       the Expiration Date indicated in your Grant Notice;
                           or

                  e.       the day before the tenth (10th) anniversary of the
                           Date of Grant.

If your option is an incentive stock option, note that, to obtain the federal
income tax advantages associated with an "incentive stock option," the Code
requires that at all times beginning on the date of grant of your option and
ending on the day three (3) months before the date of your option's exercise,
you must be an employee of the Company or an Affiliate, except in the event of
your death or Disability. The Company has provided for extended exercisability
of your option under certain circumstances for your benefit but cannot guarantee
that your option will necessarily be treated as an "incentive stock option" if
you continue to provide services to the Company or an Affiliate as a Consultant
or Director after your employment terminates or if you otherwise exercise your
option more than three (3) months after the date your employment terminates.

         8.   EXERCISE.

                  a.       You may exercise the vested portion of your option
                           (and the unvested portion of your option if your
                           Grant Notice so permits) during its term by
                           delivering a Notice of Exercise (in a form designated
                           by the Company) together with the exercise price to
                           the Secretary of the Company, or to such other person
                           as the Company may designate, during regular business
                           hours, together with such additional documents as the
                           Company may then require.

                  b.       By exercising your option you agree that, as a
                           condition to any exercise of your option, the Company
                           may require you to enter into an arrangement
                           providing for the payment by you to the Company of
                           any tax withholding obligation of the Company arising
                           by reason of (1) the exercise of your option, (2) the
                           lapse of any substantial risk of forfeiture to which
                           the shares of Common Stock are subject at the time of
                           exercise, or (3) the disposition of shares of Common
                           Stock acquired upon such exercise.

                  c.       If your option is an incentive stock option, by
                           exercising your option you agree that you will notify
                           the Company in writing within fifteen (15) days after
                           the date of any disposition of any of the shares of
                           the Common Stock issued upon exercise of your option
                           that occurs within two (2) years after the date of
                           your option grant or within one (1) year after such
                           shares of Common Stock are transferred upon exercise
                           of your option.

                  d.       By exercising your option you agree that the Company
                           (or a representative of the underwriter(s)) may, in
                           connection with the first underwritten registration
                           of the offering of any securities of the Company
                           under the Securities Act, require that you not sell,
                           dispose of, transfer, make any

                                       27.

<PAGE>

                           short sale of, grant any option for the purchase of,
                           or enter into any hedging or similar transaction with
                           the same economic effect as a sale, any shares of
                           Common Stock or other securities of the Company held
                           by you, for a period of time specified by the
                           underwriter(s) (not to exceed one hundred eighty
                           (180) days) following the effective date of the
                           registration statement of the Company filed under the
                           Securities Act. You further agree to execute and
                           deliver such other agreements as may be reasonably
                           requested by the Company and/or the underwriter(s)
                           that are consistent with the foregoing or that are
                           necessary to give further effect thereto. In order to
                           enforce the foregoing covenant, the Company may
                           impose stop-transfer instructions with respect to
                           your shares of Common Stock until the end of such
                           period. The underwriters of the Company's stock are
                           intended third party beneficiaries of this Section
                           8(d) and shall have the right, power and authority to
                           enforce the provisions hereof as though they were a
                           party hereto.

         9.   ACCELERATION OF VESTING UPON TERMINATION OF EMPLOYMENT FOLLOWING
                  CHANGE IN CONTROL. In the event that (i) the Company
                  terminates your employment for any reason other than for Cause
                  (as defined below) or (ii) you voluntarily terminate your
                  employment with the Company for Good Reason (as defined
                  below), in either case during the thirteen (13) months
                  following a Change in Control (as defined below), then
                  effective as of the date of your termination, you shall be
                  credited with additional vesting according to the following
                  formula: (i) you shall be credited with vesting of an
                  additional 25% of the total number of shares of Common Stock
                  subject to your option and (ii) in addition, in the event that
                  you have not reached the one-year cliff vesting date for your
                  option as of the date of your termination, you shall be
                  credited with vesting of an additional 2.083% of the total
                  number of shares of Common Stock subject to your option for
                  each full month following the Date of Grant during which you
                  provided services to the Company prior to your termination.

                  a.       For purposes of this Section 9, "Cause" means that,
                           in the reasonable determination of the Company, you
                           have (i) been convicted of any felony or any crime
                           involving moral turpitude or dishonesty, (ii)
                           participated in a fraud or act of dishonesty against
                           the Company, (iii) engaged in conduct that, based
                           upon a good faith and reasonable factual
                           investigation and determination by the Company,
                           demonstrates your gross unfitness to serve, or (iv)
                           committed an intentional, material violation of any
                           contract between the Company and you or any statutory
                           duty owed by you to the Company. Your physical or
                           mental disability shall not constitute "Cause."

                  b.       For purposes of this Section 9, "Change in Control"
                           means (i) any consolidation or merger of the Company
                           with or into any other corporation or other entity or
                           person, or any other corporate reorganization, in
                           which the stockholders of the Company immediately
                           prior to such consolidation, merger or reorganization
                           own less than fifty percent (50%) of the Company's
                           voting power immediately after such

                                       28.

<PAGE>

                           consolidation, merger or reorganization, (ii) any
                           transaction or series of related transactions to
                           which the Company is a party in which in excess of
                           fifty percent (50%) of the Company's voting power is
                           transferred or (iii) any sale, lease or other
                           disposition of all or substantially all of the assets
                           of the Company; provided, however, that no
                           transaction shall constitute a Change in Control to
                           the extent that such transaction is consummated
                           exclusively to change the domicile of the Company.

                  c.       For purposes of this Section 9, "Good Reason" means
                           that any of the following are undertaken without your
                           express written consent:

                           i. The assignment to you of any duties or
                                    responsibilities that results in a
                                    significant diminution in your function as
                                    in effect immediately prior to the effective
                                    date of the Change in Control; provided,
                                    however, that a mere change in your title or
                                    reporting relationships shall not constitute
                                    Good Reason;

                           ii. A material reduction by the Company in your
                                    annual base salary, as in effect on the
                                    effective date of the Change in Control; or

                           iii. A relocation of your business office to a
                                    location more than fifty (50) miles from the
                                    location at which you perform duties as of
                                    the effective date of the Change in Control,
                                    except for required travel by you on the
                                    Company's business to an extent
                                    substantially consistent with your business
                                    travel obligations prior to the Change in
                                    Control.

         10.  LIMITATION ON ACCELERATION. Notwithstanding the foregoing, if any
                  payment or benefit you would receive in connection with a
                  Change in Control (as defined above) from the Company or
                  otherwise ("Payment") would (i) constitute a "parachute
                  payment" within the meaning of Section 280G of the Internal
                  Revenue Code of 1986, as amended (the "Code"), and (ii) but
                  for this sentence, be subject to the excise tax imposed by
                  Section 4999 of the Code (the "Excise Tax"), then such Payment
                  shall be reduced to the Reduced Amount. The "Reduced Amount"
                  shall be either (x) the largest portion of the Payment that
                  would result in no portion of the Payment being subject to the
                  Excise Tax or (y) the largest portion, up to and including the
                  total, of the Payment; whichever amount, after taking into
                  account all applicable federal, state and local employment
                  taxes, income taxes, and the Excise Tax (all computed at the
                  highest applicable marginal rate), results in your receipt, on
                  an after-tax basis, of the greater amount of the Payment
                  notwithstanding that all or some portion of the Payment may be
                  subject to the Excise Tax. If a reduction in payments or
                  benefits constituting "parachute payments" is necessary so
                  that the Payment equals the Reduced Amount, reduction shall
                  occur in the following order unless you elect in writing a
                  different order (provided, however, that such election shall
                  be subject to Company approval if made on or after the
                  effective date of the Change in Control): reduction of cash
                  payments; cancellation of accelerated vesting of stock awards;
                  and reduction of

                                       29.

<PAGE>

                  other benefits. In the event that acceleration of vesting of
                  stock award compensation is to be reduced, such acceleration
                  of vesting shall be cancelled in the reverse order of the date
                  of grant of such stock awards unless you elect in writing a
                  different order for cancellation.

The accounting firm engaged by the Company for general audit purposes as of the
day of your termination of employment shall perform the foregoing calculations.
The Company shall bear all expenses with respect to the determinations by such
accounting firm required to be made hereunder. The accounting firm engaged to
make the determinations hereunder shall provide its calculations, together with
detailed supporting documentation, to the Company and you within fifteen (15)
calendar days after the date on which your right to a Payment arises (if
requested at that time by the Company or you) or at such other time as requested
by the Company or you. If the accounting firm determines that no Excise Tax is
payable with respect to a Payment, either before or after the application of the
Reduced Amount, it shall furnish the Company and you with an opinion reasonably
acceptable to you that no Excise Tax will be imposed with respect to such
Payment. Any good faith determination of the accounting firm made hereunder
shall be final, binding and conclusive upon the Company and you.

         11.  TRANSFERABILITY. Your option is not transferable, except by will
                  or by the laws of descent and distribution, and is exercisable
                  during your life only by you. Notwithstanding the foregoing,
                  by delivering written notice to the Company, in a form
                  satisfactory to the Company, you may designate a third party
                  who, in the event of your death, shall thereafter be entitled
                  to exercise your option.

         12.  RIGHT OF FIRST REFUSAL. Shares of Common Stock that you acquire
                  upon exercise of your option are subject to any right of first
                  refusal that may be described in the Company's bylaws in
                  effect at such time the Company elects to exercise its right.
                  The Company's right of first refusal shall expire on the
                  Listing Date.

         13.  RIGHT OF REPURCHASE. To the extent provided in the Company's
                  bylaws as amended from time to time, the Company shall have
                  the right to repurchase all or any part of the shares of
                  Common Stock you acquire pursuant to the exercise of your
                  option.

         14.  OPTION NOT A SERVICE CONTRACT. Your option is not an employment
                  or service contract, and nothing in your option shall be
                  deemed to create in any way whatsoever any obligation on your
                  part to continue in the employ of the Company or an Affiliate,
                  or of the Company or an Affiliate to continue your employment.
                  In addition, nothing in your option shall obligate the Company
                  or an Affiliate, their respective stockholders, Boards of
                  Directors, Officers or Employees to continue any relationship
                  that you might have as a Director or Consultant for the
                  Company or an Affiliate.

         15.  WITHHOLDING OBLIGATIONS.

                  a.       At the time you exercise your option, in whole or in
                           part, or at any time thereafter as requested by the
                           Company, you hereby authorize withholding

                                       30.

<PAGE>

                           from payroll and any other amounts payable to you,
                           and otherwise agree to make adequate provision for
                           (including by means of a "cashless exercise" pursuant
                           to a program developed under Regulation T as
                           promulgated by the Federal Reserve Board to the
                           extent permitted by the Company), any sums required
                           to satisfy the federal, state, local and foreign tax
                           withholding obligations of the Company or an
                           Affiliate, if any, which arise in connection with
                           your option.

                  b.       Upon your request and subject to approval by the
                           Company, in its sole discretion, and compliance with
                           any applicable conditions or restrictions of law, the
                           Company may withhold from fully vested shares of
                           Common Stock otherwise issuable to you upon the
                           exercise of your option a number of whole shares of
                           Common Stock having a Fair Market Value, determined
                           by the Company as of the date of exercise, not in
                           excess of the minimum amount of tax required to be
                           withheld by law. If the date of determination of any
                           tax withholding obligation is deferred to a date
                           later than the date of exercise of your option, share
                           withholding pursuant to the preceding sentence shall
                           not be permitted unless you make a proper and timely
                           election under Section 83(b) of the Code, covering
                           the aggregate number of shares of Common Stock
                           acquired upon such exercise with respect to which
                           such determination is otherwise deferred, to
                           accelerate the determination of such tax withholding
                           obligation to the date of exercise of your option.
                           Notwithstanding the filing of such election, shares
                           of Common Stock shall be withheld solely from fully
                           vested shares of Common Stock determined as of the
                           date of exercise of your option that are otherwise
                           issuable to you upon such exercise. Any adverse
                           consequences to you arising in connection with such
                           share withholding procedure shall be your sole
                           responsibility.

                  c.       You may not exercise your option unless the tax
                           withholding obligations of the Company and/or any
                           Affiliate are satisfied. Accordingly, you may not be
                           able to exercise your option when desired even though
                           your option is vested, and the Company shall have no
                           obligation to issue a certificate for such shares of
                           Common Stock or release such shares of Common Stock
                           from any escrow provided for herein.

         16.  NOTICES. Any notices provided for in your option or the Plan
                  shall be given in writing and shall be deemed effectively
                  given upon receipt or, in the case of notices delivered by
                  mail by the Company to you, five (5) days after deposit in the
                  United States mail, postage prepaid, addressed to you at the
                  last address you provided to the Company.

         17.  GOVERNING PLAN DOCUMENT. Your option is subject to all the
                  provisions of the Plan, the provisions of which are hereby
                  made a part of your option, and is further subject to all
                  interpretations, amendments, rules and regulations which may
                  from time to time be promulgated and adopted pursuant to the
                  Plan. In the event of any conflict between the provisions of
                  your option and those of the Plan, the provisions of the Plan
                  shall control.

                                       31.

<PAGE>

                             RHAPSODY NETWORKS, INC.
                           2000 EQUITY INCENTIVE PLAN
                             STOCK OPTION AGREEMENT
                          (NON-QUALIFIED STOCK OPTION)

Pursuant to your Stock Option Grant Notice ("Grant Notice") and this Stock
Option Agreement, Rhapsody Networks, Inc. (the "Company") has granted you an
option under its 2000 Equity Incentive Plan (the "Plan") to purchase the number
of shares of the Company's Common Stock indicated in your Grant Notice at the
exercise price indicated in your Grant Notice. Defined terms not explicitly
defined in this Stock Option Agreement but defined in the Plan shall have the
same definitions as in the Plan.

The details of your option are as follows:

         1.       VESTING. Subject to the limitations contained herein, your
                  option will vest as provided in your Grant Notice, provided
                  that vesting will cease upon the termination of your
                  Continuous Service.

         2.       NUMBER OF SHARES AND EXERCISE PRICE. The number of shares of
                  Common Stock subject to your option and your exercise price
                  per share referenced in your Grant Notice may be adjusted from
                  time to time for Capitalization Adjustments, as provided in
                  the Plan.

         3.       EXERCISE PRIOR TO VESTING ("EARLY EXERCISE"). If permitted in
                  your Grant Notice (i.e., the "Exercise Schedule" indicates
                  that "Early Exercise" of your option is permitted) and subject
                  to the provisions of your option, you may elect at any time
                  that is both (i) during the period of your Continuous Service
                  and (ii) during the term of your option, to exercise all or
                  part of your option, including the nonvested portion of your
                  option; provided, however, that:

                  a.       a partial exercise of your option shall be deemed to
                           cover first vested shares of Common Stock and then
                           the earliest vesting installment of unvested shares
                           of Common Stock;

                  b.       any shares of Common Stock so purchased from
                           installments that have not vested as of the date of
                           exercise shall be subject to the purchase option in
                           favor of the Company as described in the Company's
                           form of Early Exercise Stock Purchase Agreement;

                  c.       you shall enter into the Company's form of Early
                           Exercise Stock Purchase Agreement with a vesting
                           schedule that will result in the same vesting as if
                           no early exercise had occurred; and

                  d.       if your option is an incentive stock option, then, as
                           provided in the Plan, to the extent that the
                           aggregate Fair Market Value (determined at the time
                           of grant) of the shares of Common Stock with respect
                           to which your option plus all other incentive stock
                           options you hold are exercisable for the first

                                       32.

<PAGE>

                           time by you during any calendar year (under all plans
                           of the Company and its Affiliates) exceeds one
                           hundred thousand dollars ($100,000), your option(s)
                           or portions thereof that exceed such limit (according
                           to the order in which they were granted) shall be
                           treated as nonstatutory stock options.

         4.       METHOD OF PAYMENT. Payment of the exercise price is due in
                  full upon exercise of all or any part of your option. You may
                  elect to make payment of the exercise price in cash or by
                  check or in any other manner PERMITTED BY YOUR GRANT NOTICE,
                  which may include one or more of the following:

                  e.       In the Company's sole discretion at the time your
                           option is exercised and provided that at the time of
                           exercise the Common Stock is publicly traded and
                           quoted regularly in The Wall Street Journal, pursuant
                           to a program developed under Regulation T as
                           promulgated by the Federal Reserve Board that, prior
                           to the issuance of Common Stock, results in either
                           the receipt of cash (or check) by the Company or the
                           receipt of irrevocable instructions to pay the
                           aggregate exercise price to the Company from the
                           sales proceeds.

                  f.       Provided that at the time of exercise the Common
                           Stock is publicly traded and quoted regularly in The
                           Wall Street Journal, by delivery of already-owned
                           shares of Common Stock either that you have held for
                           the period required to avoid a charge to the
                           Company's reported earnings (generally six months) or
                           that you did not acquire, directly or indirectly from
                           the Company, that are owned free and clear of any
                           liens, claims, encumbrances or security interests,
                           and that are valued at Fair Market Value on the date
                           of exercise. "Delivery" for these purposes, in the
                           sole discretion of the Company at the time you
                           exercise your option, shall include delivery to the
                           Company of your attestation of ownership of such
                           shares of Common Stock in a form approved by the
                           Company. Notwithstanding the foregoing, you may not
                           exercise your option by tender to the Company of
                           Common Stock to the extent such tender would violate
                           the provisions of any law, regulation or agreement
                           restricting the redemption of the Company's stock.

                  g.       Pursuant to the following deferred payment
                           alternative:

                           i.Not less than one hundred percent (100%) of the
                                    aggregate exercise price, plus accrued
                                    interest, shall be due four (4) years from
                                    date of exercise or, at the Company's
                                    election, upon termination of your
                                    Continuous Service.

                           ii. Interest shall be compounded at least annually
                                    and shall be charged at the minimum rate of
                                    interest necessary to avoid (i) the
                                    treatment as interest, under any applicable
                                    provisions of the Code, of any portion of
                                    any amounts other than amounts stated to be
                                    interest under the deferred payment
                                    arrangement.

                                       33.

<PAGE>

                           iii. At any time that the Company is incorporated in
                                    Delaware, payment of the Common Stock's "par
                                    value," as defined in the Delaware General
                                    Corporation Law, shall be made in cash and
                                    not by deferred payment.

                           iv. In order to elect the deferred payment
                                    alternative, you must, as a part of your
                                    written notice of exercise, give notice of
                                    the election of this payment alternative
                                    and, in order to secure the payment of the
                                    deferred exercise price to the Company
                                    hereunder, if the Company so requests, you
                                    must tender to the Company a promissory note
                                    and a security agreement covering the
                                    purchased shares of Common Stock, both in
                                    form and substance satisfactory to the
                                    Company, or such other or additional
                                    documentation as the Company may request.

         5.       WHOLE SHARES. You may exercise your option only for whole
                  shares of Common Stock.

         6.       SECURITIES LAW COMPLIANCE. Notwithstanding anything to the
                  contrary contained herein, you may not exercise your option
                  unless the shares of Common Stock issuable upon such exercise
                  are then registered under the Securities Act or, if such
                  shares of Common Stock are not then so registered, the Company
                  has determined that such exercise and issuance would be exempt
                  from the registration requirements of the Securities Act. The
                  exercise of your option must also comply with other applicable
                  laws and regulations governing your option, and you may not
                  exercise your option if the Company determines that such
                  exercise would not be in material compliance with such laws
                  and regulations.

         7.       TERM. You may not exercise your option before the commencement
                  of its term or after its term expires. The term of your option
                  commences on the Date of Grant and expires upon the EARLIEST
                  of the following:

                     h.    three (3) months after the termination of your
                           Continuous Service for any reason other than
                           Disability or death, provided that if during any part
                           of such three- (3-) month period you may not exercise
                           your option solely because of the condition set forth
                           in the preceding paragraph relating to "Securities
                           Law Compliance," your option shall not expire until
                           the earlier of the Expiration Date or until it shall
                           have been exercisable for an aggregate period of
                           three (3) months after the termination of your
                           Continuous Service;

                     i.    twelve (12) months after the termination of your
                           Continuous Service due to your Disability;

                     j.    eighteen (18) months after your death if you die
                           either during your Continuous Service or within three
                           (3) months after your Continuous Service terminates
                           for reason;

                                       34.

<PAGE>

                     k.    the Expiration Date indicated in your Grant Notice;
                           or

                     l.    the day before the tenth (10th) anniversary of the
                           Date of Grant.

If your option is an incentive stock option, note that, to obtain the federal
income tax advantages associated with an "incentive stock option," the Code
requires that at all times beginning on the date of grant of your option and
ending on the day three (3) months before the date of your option's exercise,
you must be an employee of the Company or an Affiliate, except in the event of
your death or Disability. The Company has provided for extended exercisability
of your option under certain circumstances for your benefit but cannot guarantee
that your option will necessarily be treated as an "incentive stock option" if
you continue to provide services to the Company or an Affiliate as a Consultant
or Director after your employment terminates or if you otherwise exercise your
option more than three (3) months after the date your employment terminates.

         8.       EXERCISE.

                     m.    You may exercise the vested portion of your option
                           (and the unvested portion of your option if your
                           Grant Notice so permits) during its term by
                           delivering a Notice of Exercise (in a form designated
                           by the Company) together with the exercise price to
                           the Secretary of the Company, or to such other person
                           as the Company may designate, during regular business
                           hours, together with such additional documents as the
                           Company may then require.

                     n.    By exercising your option you agree that, as a
                           condition to any exercise of your option, the Company
                           may require you to enter into an arrangement
                           providing for the payment by you to the Company of
                           any tax withholding obligation of the Company arising
                           by reason of (1) the exercise of your option, (2) the
                           lapse of any substantial risk of forfeiture to which
                           the shares of Common Stock are subject at the time of
                           exercise, or (3) the disposition of shares of Common
                           Stock acquired upon such exercise.

                     o.    If your option is an incentive stock option, by
                           exercising your option you agree that you will notify
                           the Company in writing within fifteen (15) days after
                           the date of any disposition of any of the shares of
                           the Common Stock issued upon exercise of your option
                           that occurs within two (2) years after the date of
                           your option grant or within one (1) year after such
                           shares of Common Stock are transferred upon exercise
                           of your option.

                     p.    By exercising your option you agree that the Company
                           (or a representative of the underwriter(s)) may, in
                           connection with the first underwritten registration
                           of the offering of any securities of the Company
                           under the Securities Act, require that you not sell,
                           dispose of, transfer, make any short sale of, grant
                           any option for the purchase of, or enter into any
                           hedging or similar transaction with the same economic
                           effect as a sale, any shares of Common Stock or other
                           securities of the Company held by you,

                                       35.

<PAGE>

                           for a period of time specified by the underwriter(s)
                           (not to exceed one hundred eighty (180) days)
                           following the effective date of the registration
                           statement of the Company filed under the Securities
                           Act. You further agree to execute and deliver such
                           other agreements as may be reasonably requested by
                           the Company and/or the underwriter(s) that are
                           consistent with the foregoing or that are necessary
                           to give further effect thereto. In order to enforce
                           the foregoing covenant, the Company may impose
                           stop-transfer instructions with respect to your
                           shares of Common Stock until the end of such period.
                           The underwriters of the Company's stock are intended
                           third party beneficiaries of this Section 9(d) and
                           shall have the right, power and authority to enforce
                           the provisions hereof as though they were a party
                           hereto.

         9.       TRANSFERABILITY. Your option is not transferable, except by
                  will or by the laws of descent and distribution, and is
                  exercisable during your life only by you. Notwithstanding the
                  foregoing, by delivering written notice to the Company, in a
                  form satisfactory to the Company, you may designate a third
                  party who, in the event of your death, shall thereafter be
                  entitled to exercise your option.

         10.      RIGHT OF FIRST REFUSAL. Shares of Common Stock that you
                  acquire upon exercise of your option are subject to any right
                  of first refusal that may be described in the Company's bylaws
                  in effect at such time the Company elects to exercise its
                  right. The Company's right of first refusal shall expire on
                  the Listing Date.

         11.      RIGHT OF REPURCHASE. To the extent provided in the Company's
                  bylaws as amended from time to time, the Company shall have
                  the right to repurchase all or any part of the shares of
                  Common Stock you acquire pursuant to the exercise of your
                  option.

         12.      OPTION NOT A SERVICE CONTRACT. Your option is not an
                  employment or service contract, and nothing in your option
                  shall be deemed to create in any way whatsoever any obligation
                  on your part to continue in the employ of the Company or an
                  Affiliate, or of the Company or an Affiliate to continue your
                  employment. In addition, nothing in your option shall obligate
                  the Company or an Affiliate, their respective stockholders,
                  Boards of Directors, Officers or Employees to continue any
                  relationship that you might have as a Director or Consultant
                  for the Company or an Affiliate.

         13.      WITHHOLDING OBLIGATIONS.

                  q.       At the time you exercise your option, in whole or in
                           part, or at any time thereafter as requested by the
                           Company, you hereby authorize withholding from
                           payroll and any other amounts payable to you, and
                           otherwise agree to make adequate provision for
                           (including by means of a "cashless exercise" pursuant
                           to a program developed under Regulation T as
                           promulgated by the Federal Reserve Board to the
                           extent permitted by the Company), any sums required
                           to satisfy the federal, state, local and

                                       36.

<PAGE>

                           foreign tax withholding obligations of the Company or
                           an Affiliate, if any, which arise in connection with
                           your option.

                  r.       Upon your request and subject to approval by the
                           Company, in its sole discretion, and compliance with
                           any applicable conditions or restrictions of law, the
                           Company may withhold from fully vested shares of
                           Common Stock otherwise issuable to you upon the
                           exercise of your option a number of whole shares of
                           Common Stock having a Fair Market Value, determined
                           by the Company as of the date of exercise, not in
                           excess of the minimum amount of tax required to be
                           withheld by law. If the date of determination of any
                           tax withholding obligation is deferred to a date
                           later than the date of exercise of your option, share
                           withholding pursuant to the preceding sentence shall
                           not be permitted unless you make a proper and timely
                           election under Section 83(b) of the Code, covering
                           the aggregate number of shares of Common Stock
                           acquired upon such exercise with respect to which
                           such determination is otherwise deferred, to
                           accelerate the determination of such tax withholding
                           obligation to the date of exercise of your option.
                           Notwithstanding the filing of such election, shares
                           of Common Stock shall be withheld solely from fully
                           vested shares of Common Stock determined as of the
                           date of exercise of your option that are otherwise
                           issuable to you upon such exercise. Any adverse
                           consequences to you arising in connection with such
                           share withholding procedure shall be your sole
                           responsibility.

                  s.       You may not exercise your option unless the tax
                           withholding obligations of the Company and/or any
                           Affiliate are satisfied. Accordingly, you may not be
                           able to exercise your option when desired even though
                           your option is vested, and the Company shall have no
                           obligation to issue a certificate for such shares of
                           Common Stock or release such shares of Common Stock
                           from any escrow provided for herein.

         14.      NOTICES. Any notices provided for in your option or the Plan
                  shall be given in writing and shall be deemed effectively
                  given upon receipt or, in the case of notices delivered by
                  mail by the Company to you, five (5) days after deposit in the
                  United States mail, postage prepaid, addressed to you at the
                  last address you provided to the Company.

         15.      GOVERNING PLAN DOCUMENT. Your option is subject to all the
                  provisions of the Plan, the provisions of which are hereby
                  made a part of your option, and is further subject to all
                  interpretations, amendments, rules and regulations which may
                  from time to time be promulgated and adopted pursuant to the
                  Plan. In the event of any conflict between the provisions of
                  your option and those of the Plan, the provisions of the Plan
                  shall control.

                                       37.

<PAGE>

                             RHAPSODY NETWORKS, INC.

                            STOCK PURCHASE AGREEMENT

THIS STOCK PURCHASE AGREEMENT (the "Agreement") is made as of the ___ day of
June, 2001, by and between RHAPSODY NETWORKS, INC., a Delaware corporation (the
"Company"), and ___________ ("Purchaser").

WHEREAS, the Company desires to issue and Purchaser desires to acquire stock of
the Company as herein described, on the terms and conditions hereinafter set
forth.

NOW, THEREFORE, IT IS AGREED between the parties as follows:

         1.       ISSUE AND SALE OF STOCK. Purchaser hereby agrees to acquire
                  from the Company, and the Company hereby agrees to issue to
                  Purchaser, an aggregate of ________ (______) shares of the
                  common stock of the Company (the "Current Stock") with a fair
                  market value of $0.066667 per share, for an aggregate fair
                  market value of $_____, in consideration for past consulting
                  services rendered by Purchaser to the Company.

         2.       SUBSEQUENT ISSUANCE OF STOCK. Purchaser hereby agrees to
                  acquire from time to time and the Company hereby agrees to
                  issue from time to time shares of the Company's common stock
                  at fair market value (the "Future Stock" and, collectively
                  with the Current Stock, the "Stock") in consideration for past
                  consulting services rendered by Purchaser to the Company.
                  Purchaser and the Company each hereby agree to be bound by the
                  terms of this Agreement for each subsequent issuance of Future
                  Stock.

         3.       LIMITATIONS ON TRANSFER. Purchaser shall not assign,
                  hypothecate, donate, encumber or otherwise dispose of any
                  interest in the Stock except in compliance with the provisions
                  herein and applicable securities laws. Furthermore, the Stock
                  shall be subject to any right of first refusal in favor of the
                  Company or its assignees that may be contained in the
                  Company's Bylaws. The Company shall not be required (a) to
                  transfer on its books any shares of Stock of the Company which
                  shall have been transferred in violation of any of the
                  provisions set forth in this Agreement or (b) to treat as
                  owner of such shares or to accord the right to vote as such
                  owner or to pay dividends to any transferee to whom such
                  shares shall have been so transferred.

         4.       RESTRICTIVE LEGENDS. All certificates representing the Stock
                  shall have endorsed thereon legends in substantially the
                  following forms (in addition to any other legend which may be
                  required by other agreements between the parties hereto):

                     t.    "THE SHARES REPRESENTED BY THIS CERTIFICATE HAVE NOT
                           BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933, AS
                           AMENDED. THEY MAY NOT BE SOLD, OFFERED FOR SALE,
                           PLEDGED OR HYPOTHECATED IN THE ABSENCE OF AN
                           EFFECTIVE REGISTRATION STATEMENT AS TO THE SECURITIES
                           UNDER SAID ACT OR AN OPINION OF COUNSEL

                                       38.

<PAGE>

                           SATISFACTORY TO THE COMPANY THAT SUCH REGISTRATION IS
                           NOT REQUIRED."

                     u.    "THE SHARES REPRESENTED BY THIS CERTIFICATE ARE
                           SUBJECT TO A RIGHT OF FIRST REFUSAL OPTION IN FAVOR
                           OF THE COMPANY AND/OR ITS ASSIGNEE(S) AS PROVIDED IN
                           THE BYLAWS OF THE COMPANY."

                     v.    Any legend required by appropriate blue sky
                           officials.

         5.       INVESTMENT REPRESENTATIONS. In connection with the acquisition
                  of the Current Stock and any acquisition of Future Stock,
                  Purchaser represents to the Company the following:

                     w.    Purchaser is aware of the Company's business affairs
                           and financial condition and has acquired sufficient
                           information about the Company to reach an informed
                           and knowledgeable decision to acquire the Stock.
                           Purchaser is not purchasing the Stock pursuant to any
                           publication of any advertisement soliciting the
                           purchase of securities of the Company. Purchaser is
                           purchasing the Stock for investment for Purchaser's
                           own account only and not with a view to, or for
                           resale in connection with, any "distribution" thereof
                           within the meaning of the Act.

                     x.    Purchaser understands that the Stock has not been
                           registered under the Securities Act of 1933 (the
                           "Act") by reason of a specific exemption therefrom,
                           which exemption depends upon, among other things, the
                           bona fide nature of Purchaser's investment intent as
                           expressed herein.

                     y.    Purchaser further acknowledges and understands that
                           the Stock must be held indefinitely unless the Stock
                           is subsequently registered under the Act or an
                           exemption from such registration is available.
                           Purchaser further acknowledges and understands that
                           the Company is under no obligation to register the
                           Stock. Purchaser understands that the certificate
                           evidencing the Stock will be imprinted with a legend
                           which prohibits the transfer of the Stock unless the
                           Stock is registered or such registration is not
                           required in the opinion of counsel for the Company.

                     z.    Purchaser is familiar with the provisions of Rule 144
                           under the Act, as in effect from time to time, which,
                           in substance, permit limited public resale of
                           "restricted securities" acquired, directly or
                           indirectly, from the issuer thereof (or from an
                           affiliate of such issuer), in a non-public offering
                           subject to the satisfaction of certain conditions.
                           The Stock may be resold by Purchaser in certain
                           limited circumstances subject to the provisions of
                           Rule 144, which requires, among other things: (i) the
                           availability of certain public information about the
                           Company and (ii) the resale occurring following the
                           required holding period under Rule 144 after the
                           Purchaser

                                       39.

<PAGE>

                           has purchased, and made full payment of (within the
                           meaning of Rule 144), the securities to be sold.

                     aa.   Purchaser further understands that at the time
                           Purchaser wishes to sell the Stock there may be no
                           public market upon which to make such a sale and
                           that, even if such a public market then exists, the
                           Company may not be satisfying the current public
                           information requirements of Rule 144 and that, in
                           such event, Purchaser would be precluded from selling
                           the Stock under Rule 144 even if the minimum holding
                           period requirement had been satisfied.

                     bb.   Purchaser further warrants and represents that
                           Purchaser is an accredited investor under the Act.

         6.       MARKET STAND-OFF AGREEMENT. Purchaser shall not sell, dispose
                  of, transfer, make any short sale of, grant any option for the
                  purchase of, or enter into any hedging or similar transaction
                  with the same economic effect as a sale, any common stock of
                  the Company held by Purchaser, including the Stock (the
                  "Restricted Securities"), for a period of time specified by
                  the managing underwriter(s) (not to exceed one hundred eighty
                  (180) days) following the effective date of a registration
                  statement of the Company filed under the Act. Purchaser agrees
                  to execute and deliver such other agreements as may be
                  reasonably requested by the Company and/or the managing
                  underwriter(s) which are consistent with the foregoing or
                  which are necessary to give further effect thereto. In order
                  to enforce the foregoing covenant, the Company may impose
                  stop-transfer instructions with respect to Purchaser's
                  Restricted Securities until the end of such period. The
                  underwriters of the Company's stock are intended third party
                  beneficiaries of this Section 6 and shall have the right,
                  power and authority to enforce the provisions hereof as though
                  they were a party hereto.

         7.       NO EMPLOYMENT RIGHTS. This Agreement is not an employment
                  contract and nothing in this Agreement shall affect in any
                  manner whatsoever the right or power of the Company (or a
                  parent or subsidiary of the Company) to terminate Purchaser's
                  employment or consulting agreement for any reason at any time,
                  with or without cause and with or without notice.

         8.       MISCELLANEOUS.

                     cc.   NOTICES. Any notice required or permitted hereunder
                           shall be given in writing and shall be deemed
                           effectively given upon personal delivery or sent by
                           telegram or fax or upon deposit in the United States
                           Post Office, by registered or certified mail with
                           postage and fees prepaid, addressed to the other
                           party hereto at his or its address hereinafter shown
                           below his or its signature or at such other address
                           as such party may designate by ten (10) days' advance
                           written notice to the other party hereto.

                     dd.   SUCCESSORS AND ASSIGNS. This Agreement shall inure to
                           the benefit of the successors and assigns of the
                           Company and, subject to the restrictions on

                                       40.

<PAGE>

                           transfer herein set forth, be binding upon Purchaser,
                           Purchaser's successors and assigns.

                     ee.   ATTORNEYS' FEES; SPECIFIC PERFORMANCE. Purchaser
                           shall reimburse the Company for all costs incurred by
                           the Company in enforcing the performance of, or
                           protecting its rights under, any part of this
                           Agreement, including reasonable costs of
                           investigation and attorneys' fees.

                     ff.   GOVERNING LAW; VENUE. This Agreement shall be
                           governed by and construed in accordance with the laws
                           of the State of California. The parties agree that
                           any action brought by either party to interpret or
                           enforce any provision of this Agreement shall be
                           brought in, and each party agrees to, and does
                           hereby, submit to the jurisdiction and venue of, the
                           appropriate state or federal court for the district
                           encompassing the Company's principal place of
                           business.

                     gg.   FURTHER EXECUTION. The parties agree to take all such
                           further action(s) as may reasonably be necessary to
                           carry out and consummate this Agreement as soon as
                           practicable, and to take whatever steps may be
                           necessary to obtain any governmental approval in
                           connection with or otherwise qualify the issuance of
                           the securities that are the subject of this
                           Agreement.

                     hh.   INDEPENDENT COUNSEL. Purchaser acknowledges that this
                           Agreement has been prepared on behalf of the Company
                           by Cooley Godward LLP, counsel to the Company, and
                           that Cooley Godward LLP does not represent, and is
                           not acting on behalf of, Purchaser. Purchaser has
                           been provided with an opportunity to consult with
                           Purchaser's own counsel with respect to this
                           Agreement.

                     ii.   ENTIRE AGREEMENT; AMENDMENT. This Agreement
                           constitutes the entire agreement between the parties
                           with respect to the subject matter hereof and
                           supersedes and merges all prior agreements or
                           understandings, whether written or oral. This
                           Agreement may not be amended, modified or revoked, in
                           whole or in part, except by an agreement in writing
                           signed by each of the parties hereto.

                     jj.   SEVERABILITY. If one or more provisions of this
                           Agreement are held to be unenforceable under
                           applicable law, the parties agree to renegotiate such
                           provision in good faith. In the event that the
                           parties cannot reach a mutually agreeable and
                           enforceable replacement for such provision, then (i)
                           such provision shall be excluded from this Agreement,
                           (ii) the balance of the Agreement shall be
                           interpreted as if such provision were so excluded and
                           (iii) the balance of the Agreement shall be
                           enforceable in accordance with its terms.

                                       41.

<PAGE>

                     kk.   COUNTERPARTS. This Agreement may be executed in two
                           or more counterparts, each of which shall be deemed
                           an original and all of which together shall
                           constitute one instrument.

         IN WITNESS WHEREOF, the parties hereto have executed this Agreement as
of the day and year first above written.

                                    RHAPSODY NETWORKS, INC.

                                    By:________________________________________

                                    Name: Michael Klayko
                                    Chief Executive Officer
                                    Address:  3450 West Warren Avenue
                                              Fremont, CA 94538

                                    PURCHASER:
                                    ___________________________________________

                                    Address:

                                       42.

Source: [{"source": "alea-institute/alea-institute/kl3m-data-edgar-agreements/train-00047-of-00352.parquet"}, [{"source": "alea-institute/alea-institute/kl3m-data-edgar-agreements/train-00047-of-00352.parquet"}]]