Document:

EXHIBIT 4.12

                                    WARRANT

NEITHER  THE  WARRANTS  REPRESENTED  HEREBY  NOR THE  SECURITIES  ISSUABLE  UPON
EXERCISE  THEREOF HAVE BEEN  REGISTERED  UNDER THE  SECURITIES  ACT OF 1933,  AS
AMENDED  (THE  "ACT").  NONE OF SUCH  SECURITIES  MAY BE OFFERED OR SOLD  EXCEPT
PURSUANT  TO (i) AN  EFFECTIVE  REGISTRATION  STATEMENT,  OR (ii)  AN  AVAILABLE
EXEMPTION  FROM  REGISTRATION  UNDER  THE ACT  RELATING  TO THE  DISPOSITION  OF
SECURITIES AND UPON DELIVERY TO THE COMPANY OF AN OPINION OF COUNSEL, REASONABLY
SATISFACTORY TO COUNSEL FOR THE COMPANY,  THAT SUCH EXEMPTION FROM  REGISTRATION
UNDER THE ACT IS AVAILABLE.

DATE: AUGUST 25, 1999

                              WARRANT TO PURCHASE
                                   SHARES OF
                                  COMMON STOCK
                                       OF
                                  eGLOBE, INC.

         eGlobe, Inc., a Delaware corporation (the "Company"),  hereby Issues to
Seymour Gordon (the "Holder") this warrant to purchase from the Company, (i) for
a price per share equal to $1.00, 60,000 shares of common stock, $.001 par value
per share of the Company (the "Common Stock").

         1. Exercise.  The rights  represented by this warrant may be exercised,
in whole or in part at any time after the date  hereof  until 5:00 PM (New York,
New York  time) on the  fifth  anniversary  of the date  hereof  (the  "Exercise
Period"),  by (a) the  surrender of this  warrant,  along with the purchase form
attached as Exhibit A (the "Purchase Form"),  properly executed,  at the address
of the Company  set forth in section  6.2 (or such other  address as the Company
may  designate  by notice in writing to the Holder at its  address  set forth in
section 6.2) and (b) the payment to the Company of the exercise  price by check,
payable to the order of the  Company,  for the number of shares of Common  Stock
specified in the Purchase  Form,  together with any  applicable  stock  transfer
taxes. A certificate  representing  the shares of Common Stock so purchases and,
in the event of an  exercise  of fewer than all the rights  represented  by this
warrant,  a new  warrant in the form of this  warrant  issued in the name of the
Holder or its designee(s) and representing a new warrant to purchase a number of
shares of Common Stock equal to the number of shares of Common Stock as to which
this  warrant was  theretofore  exercisable  less the number of shares of Common
Stock as to which this warrant shall  theretofore have been exercised,  shall be
delivered to the Holder or such  designee(s) as promptly as practicable,  but in
no event later than three business  days,  after this warrant shall have been so
exercised.
         2. Antidilution. In case the Company shall (i) pay a dividend in shares
of Common Stock or make a distribution in shares of Common Stock, (ii) subdivide
its outstanding shares of

<PAGE>

Common  Stock  (including,  without  limitation,  by way of stock splits and the
like),  (iii)  combine  its  outstanding  shares of Common  Stock into a smaller
number of shares of Common Stock or (iv) issue by reclassification of its shares
of  Common  Stock  other   securities  of  the  Company   (including   any  such
reclassification  in  connection  with a  consolidation  or  merger in which the
Company is the  surviving  corporation),  the  number of shares of Common  Stock
purchasable  upon  exercise of this warrant  immediately  prior thereto shall be
adjusted so that the Holder shall be entitled to receive the number of shares of
Common Stock or the kind and number of other  securities of the Company which it
would have owned or have been  entitled to receive after the happening of any of
the events described above had this warrant been exercised, immediately prior to
the  happening  of such event or any record date with respect  thereto,  and the
exercise  price per share shall be adjusted  appropriately.  An adjustment  made
pursuant  to this  section  2  shall  become  effective  immediately  after  the
effective  date of each such event  retroactive  to the record date, if any, for
such event, without amendment or modification required to this document.

         3. Transfer.  Subject to applicable law (including the requirements set
forth in the legend at the  beginning  of this  warrant),  this  warrant  may be
transferred  at any time,  in whole or in part,  to any person or  persons.  Any
transfer shall be effected by the surrender of this warrant, along with the form
of assignment  attached as Exhibit B, properly  executed,  at the address of the
Company  set forth in section  6.2 (or such other  address  as the  Company  may
designate by notice in writing to the Holder at its address set forth in section
6.2).  Thereupon,  the Company shall issue in the name or names specified by the
Holder a new  warrant or warrants  of like tenor and  representing  a warrant or
warrants to purchase in the  aggregate a number of shares equal to the number of
shares to which this  warrant  was  theretofore  exercisable  less the number of
shares as to which this warrant shall theretofore have been exercised.

         4. Payment of Taxes. The Company shall cause all shares of Common Stock
issued upon the  exercise of this warrant to be validly  issued,  fully paid and
nonassessable  and not subject to preemptive  rights.  The Company shall pay all
expenses in connection with, and all taxes and other  governmental  charges that
may be imposed  with respect to the issuance or delivery of the shares of Common
Stock upon exercise of this warrant, unless such tax or charge is imposed by law
upon the Holder.

         5. Reservation of Shares. From and after the date of this warrant,  the
Company  shall at all times  reserve and keep  available  for issuance  upon the
exercise  of this  warrant a number of its  authorized  but  unissued  shares of
Common Stock sufficient to permit the exercise in full of this warrant.

         6. Miscellaneous.

         6.1  Securities Act  Restrictions.  The Holder  acknowledges  that this
warrant  may  not  be  sold,   transferred  or  otherwise  disposed  of  without
registration  under the  Securities  Act of 1933,  as amended  (the "Act") or an
applicable  exemption  from  the  registration  requirements  of  the  Act  and,
accordingly,  this warrant and all  certificates  representing  the Common Stock
issuable  upon the exercise of this warrant  shall bear a legend in the form set
forth on the top of page one of this warrant.

                                      -2-
<PAGE>

         6.2 Notices.  Any notices and other  communications  under this warrant
shall  be in  writing  and may be  given by any of the  following  methods:  (a)
personal delivery; (b) facsimile transmission; (c) registered or certified mail,
postage prepaid,  return receipt  requested;  or (d) overnight delivery service.
Notices  shall be sent to the  appropriate  party at its  address  or  facsimile
number given below (or at such other address or facsimile  number for such party
s shall be specified by notice given hereunder; (a) If to the Company, to it at:
1250 24th Street, NW, Suite 725, Washington, D.C. 20037, Fax No. (202) 822-8984,
Attention:  Chief  Executive  Officer,  and if to the  Holder,  to it at his/her
address  appearing on the stock records of the Company at the time that a notice
shall be mailed, or at such other address as the party to be notified shall from
time to time have furnished to the Company.  All such notices and communications
shall be deemed received upon (a) actual receipt  thereof by the addressee,  (b)
actual  delivery  thereof  to the  appropriate  address  or (c) in the case of a
facsimile transmission,  upon transmission thereof by the sender and issuance by
the  transmitting  machine of a confirmation  slip confirming that the number of
pages  constituting the notice have been transmitted  without error. In the case
of notices sent by facsimile  transmission,  the sender shall  contemporaneously
mail a copy of the notice to the  addressee  at the address  provided for above.
However,  such mailing  shall in no way alter the time or at which the facsimile
notice is deemed received.

         6.3  Amendment.  This  warrant  may  be  modified  or  amended  or  the
provisions  of this  warrant may be waived only with the written  consent of the
Company and the Holder.

         6.4  Governing  Law.  This warrant  shall be governed by the law of the
State  of  Delaware,  without  regard  to the  provisions  thereof  relating  to
conflicts of laws.

                                     eGLOBE, INC.

                                     By: /s/ Christopher J. Vizas
                                         ----------------------------
                                     Name: Christopher J. Vizas
                                     Title: Chairman of the Board of
                                     Directors and Chief
                                     Executive Officer

                                      -3-
<PAGE>

                                   EXHIBIT A

                                 PURCHASE FORM

         Seymour  Gordon,  the  undersigned  registered  owner of this  warrant,
irrevocably  exercises  this warrant for the purchase of 60,000 shares of common
stock,  $.001 par value per share (the "Common  Stock") of eGlobe,  Inc.,  for a
price per share  equal to $1.00 on the terms and  conditions  specified  in this
warrant,  and requests that  certificates  for the shares of Common Stock hereby
purchased be issued in the name of and delivered to the undersigned.

Dated:                                Seymour Gordon
      --------------------
                                      By:
                                          ------------------------
                                      Title:
                                               ---------------------
                                      Address:
                                                 -------------------

<PAGE>

                                   EXHIBIT B

                                ASSIGNMENT FORM

         FOR VALUE RECEIVED,  the undersigned  registered  owner of this warrant
hereby  sells,  assigns and  transfers  to the  assignee  named below all of the
rights of the  undersigned  under  this  warrant  with  respect to the number of
shares of common  stock,  $.001 par value per share of  eGlobe,  Inc.  set forth
below:

Name and Address of Assignee                       No. of Shares of Common Stock
----------------------------                       -----------------------------

and  does  hereby   irrevocably   constitute   and   appoint   _________________
attorney-in-fact  to  register  such  transfer  on the  books  of  eGlobe,  Inc.
maintained for the purpose, with full power of substitution in the premises.

Dated:                              Print Name:
       -------------------------               ---------------------
                                    Signature:
                                              ----------------------
                                    Witness:
                                            ------------------------EXHIBIT 10.5

                                  eGLOBE, INC.
                         1995 EMPLOYEE STOCK OPTION AND
                            APPRECIATION RIGHTS PLAN

                             AS AMENDED AND RESTATED

<PAGE>

                                TABLE OF CONTENTS

1.       Purpose  .............................................      1
2.       General Provisions.....................................     1
3.       Eligibility............................................     2
4.       Number of Shares Subject to Plan.......................     2
5.       Stock Options..........................................     2
6.       Stock Appreciation Rights..............................     6
7.       Effect of Changes in Capitalization....................     8
8.       Nontransferability.....................................     9
9.       Amendment, Suspension, or Termination of Plan..........    10
10.      Effective Date.........................................    10
11.      Termination Date.......................................    10
12.      Resale of Shares Purchased.............................    10
13.      Acceleration of Rights and Options.....................    10
14.      Written Notice Required; Tax Withholding...............    11
15.      Compliance with Securities Laws........................    11
16.      Waiver of Vesting Restrictions by Committee............    12
17.      Reports to Participants................................    12
18.      No Employee Contract...................................    12

<PAGE>

                                  eGLOBE, INC.
                         1995 EMPLOYEE STOCK OPTION AND
                            APPRECIATION RIGHTS PLAN
                             AS AMENDED AND RESTATED

                  1. PURPOSE.  eGlobe, Inc. hereby establishes its 1995 Employee
Stock Option and Appreciation  Rights Plan (the "Plan").  The purpose of
the Plan is to  advance  the  interests  of  Executive  TeleCard,  Ltd.  and its
subsidiaries  (collectively  "the  Company") and the Company's  stockholders  by
providing  a means by which the  Company  shall be able to  attract  and  retain
competent employees, officers, non-employee directors,  consultants and advisors
by providing them with an  opportunity to participate in the increased  value of
the Company which their effort, initiative, and skill have helped produce.

                  2.     GENERAL PROVISIONS.

                  (a)  The  Plan  will  be  administered  by  the   Compensation
Committee of the Board of Directors of the Company (the "Committee"),  provided,
however, that except as otherwise expressly provided in this Plan or in order to
comply  with Rule 16b-3 under the  Securities  Exchange  Act of 1934,  as now in
effect or as hereafter  amended (the "Exchange  Act"), the Board of Directors of
the Company (the  "Board")  may  exercise any power or authority  granted to the
Committee  under this Plan.  The  Committee  shall be  comprised  of two or more
directors designated by the Board.

                  (b) The  Committee  shall  have  full  power to  construe  and
interpret  the Plan and to  establish  and amend rules and  regulations  for its
administration.  Any action of the  Committee  with respect to the Plan shall be
taken by majority  vote or by the  unanimous  written  consent of the  Committee
members.

                  (c) The Committee  shall  determine,  in its sole  discretion,
which  participants  under the Plan  shall be  granted  stock  options  or stock
appreciation  rights,  the time or times at which options or rights are granted,
as well as the  number  and the  duration  of the  options  or rights  which are
granted to participants;  provided,  however, that no participant may be granted
options to  purchase  more than  500,000  shares of common  stock of the Company
("Common Stock") under the Plan in any two (2) year period.

                  (d) The  Committee  shall also  determine  any other terms and
conditions  relating  to  options  and  rights  granted  under  the  Plan as the
Committee may prescribe, in its sole discretion.

<PAGE>

                  (e) The Committee shall make all other determinations and take
all other actions which it deems  necessary or advisable for the  administration
of the Plan.

                  (f) All decisions,  determinations and interpretations made by
the Committee  shall be binding and conclusive on all  participants  in the Plan
and on their legal representatives, heirs and beneficiaries.

                  3. ELIGIBILITY.    The  Company's    employees,   non-employee
directors, advisors, consultants and any other individual whose participation in
the Plan is determined  to be in the best  interests of the Company by the Board
shall be eligible to participate  in the Plan and to receive  options and rights
hereunder,  provided,  however, that Incentive Stock Options may only be granted
to employees of the Company or its subsidiaries.

                  4. NUMBER OF SHARES SUBJECT TO PLAN.  The aggregate  number of
shares of the Company's Common Stock which may be granted to participants  shall
be 7,000,000 shares, subject to adjustment only as provided in Sections 5(h) and
7 hereof.  These shares may consist of shares of the  Company's  authorized  but
unissued  Common Stock or shares of the Company's  authorized  and issued Common
Stock  reacquired  by the  Company and held in its  treasury or any  combination
thereof.  If an option granted under this Plan is surrendered,  or for any other
reason ceases to be  exercisable in whole or in part, the shares as to which the
option ceases to be exercisable  shall be available for options to be granted to
the same or other  participants  under the Plan,  except to the  extent  that an
option is deemed  surrendered  by the  exercise of a tandem  stock  appreciation
right and that right is paid by the Company in stock,  in which event the shares
issued in  satisfaction  of the right shall not be available  for new options or
rights  under the Plan.  Further,  shares  issued  under  the Plan  through  the
settlement,  assumption or substitution of outstanding  awards or obligations to
grant future awards as a result of acquiring another entity shall not reduce the
maximum number of shares available for delivery under the Plan.

                  5. STOCK OPTIONS.

                  (a)  TYPE  OF   OPTIONS.   Options   granted   may  be  either
Nonqualified Stock Options or Incentive Stock

Options as determined by the Committee in its sole  discretion  and as reflected
in the Notice of Grant issued by the Committee.  "Incentive  Stock Option" means
an option intended to qualify as an incentive stock option within the meaning of
ss. 422 of the Internal Revenue Code of 1986 (the "Code").  "Nonqualified  Stock
Option" means an option not intended to qualify as an Incentive  Stock Option or
an Incentive  Stock Option  which is  converted to a  Nonqualified  Stock Option
under Section 5(f) hereof.

<PAGE>

                  (b) OPTION  PRICE.  The price at which  options may be granted
under the Plan  shall be  determined  by the  Committee  at the time of grant as
follows:

                                    (i) For  Incentive  Stock Options the option
price shall be equal to 100% of the Fair  Market  Value of the stock on the date
the option is granted;  provided,  however,  that for  Incentive  Stock  Options
granted to any person who, at the time such option is granted,  owns (as defined
in ss. 422 of the Code) shares  possessing  more than 10% of the total  combined
voting power of all classes of shares of the Company or its parent or subsidiary
corporation, the option price shall be 110% of the Fair Market Value.

                                    (ii)  For  Nonqualified  Stock  Options  the
option  price  shall be not  less  than  the par  value of a share of the  Stock
covered by the Option.

                                    (iii) For purposes of this Plan,  and except
as otherwise set forth herein,  "Fair Market Value" shall mean:  (A) if there is
an established market for the Company's Common Stock on a stock exchange,  in an
over-the-counter  market or otherwise,  shall be the closing price of the shares
of Common  Stock on such  exchange or in such market (the  highest  such closing
price if there is more than one such exchange or market) on the valuation  date,
or (B) if there were no such sales on the  valuation  date,  then in  accordance
with Treas.  Reg.  ss.  20.2031-2  or successor  regulations.  Unless  otherwise
specified by the Committee at the time or grant (or in the formula  proposed for
such grant, if applicable),  the valuation date for purposes of determining Fair
Market  Value  shall  be the  date of  grant.  The  Committee  (or the  Board of
Directors with respect to grants to Committee  members  pursuant to Section 5(g)
hereof may specify in any grant of an option or stock  appreciation  right that,
instead of the date of grant,  the valuation date shall be a valuation period of
up to ninety  (90) days prior to the date of grant,  and Fair  Market  Value for
purposes  of such grant shall be the average  over the  valuation  period of the
closing  price of the shares of Common Stock on such  exchange or in such market
(the  highest  such  closing  price if there is more than one such  exchange  or
market) on each date on which sales were made in the valuation period, provided,
however,  that if the Committee  (or the Board of Directors)  fails to specify a
valuation  period and there were no sales on the date of grant then Fair  Market
Value shall be  determined  as if the  Committee had specified a thirty (30) day
valuation period for such  determination,  unless there is no established market
for the Company's  Common Stock in which case the  determination  of Fair Market
Value shall be in accordance with clause (B) above.

                  (c) EXERCISE OF OPTION.  The right to purchase  shares covered
by any option under this Plan shall be exercisable  only in accordance  with the
terms

<PAGE>

and  conditions of the grant to the  participant.  Such terms and conditions may
include a time period or schedule whereby some of the options granted may become
exercisable,  or "vested", over time and certain conditions,  such as continuous
service or specified  performance  criteria or goals, must be satisfied for such
vesting.  The determination as to whether to impose any such vesting schedule or
performance  criteria,  and the terms of such  schedule  or  criteria,  shall be
within the sole  discretion of the Committee.  These terms and conditions may be
different  for  different  participants  so  long  as all  options  satisfy  the
requirements of the Plan.

                  The exercise of options shall be paid for in cash or in shares
of the Company's  Common Stock, or any combination  thereof.  Shares tendered as
payment for option exercises shall, if acquired from the Company, have been held
for at least six  months  and shall be  valued at the Fair  Market  Value of the
shares on the date of exercise. The Committee may, in its discretion, agree to a
loan by the  Company to one or more  participants  of a portion of the  exercise
price (not to exceed the exercise  price minus the par value of the shares to be
acquired,  if any) for up to three (3) years with interest  payable at the prime
rate quoted in the Wall Street  Journal on the date of exercise.  Members of the
Committee  may receive  such loans from the  Company  for the  exercise of their
options, if any, only with approval by the Board.

                  The Committee  may also permit a  participant  to effect a net
exercise of an option  without  tendering any shares of the  Company's  stock as
payment for the option. In such an event, the participant will be deemed to have
paid for the exercise of the option with shares of the Company's stock and shall
receive from the Company a number of shares equal to the difference  between the
shares  that would  have been  tendered  and the  number of  options  exercised.
Members of the  Committee  may effect a net exercise of their  options only with
the approval of the Board.

                  The  Committee  may also  cause  the  Company  to  enter  into
arrangements   with  one  or  more  licensed  stock   brokerage   firms  whereby
participants  may exercise options without payment therefor but with irrevocable
orders to such brokerage firm to immediately sell the number of shares necessary
to pay the exercise price for the option and the withholding  taxes, if any, and
then to  transmit  the  proceeds  from such  sales  directly  to the  Company in
satisfaction of such obligations.

                  The Committee may prescribe  forms which must be completed and
signed by a participant and tendered with payment of the exercise price in order
to exercise an option.

<PAGE>

                  (d) DURATION OF OPTIONS.  Unless  otherwise  prescribed by the
Committee or this Plan,  options  granted  hereunder shall expire ten (10) years
from the date of grant, subject to early termination as provided in Section 5(f)
hereof.

                  (e) INCENTIVE STOCK OPTIONS LIMITATIONS.  In no event shall an
Incentive  Stock Option be granted to any person who, at the time such option is
granted,  owns (as defined in ss. 422 of the Code) shares  possessing  more than
10% of the total  combined  voting power of all classes of shares of the Company
or of its parent or subsidiary corporation,  unless the option price is at least
110% of the Fair  Market  Value of the stock  subject  to the  Option,  and such
Option is by its terms not  exercisable  after the  expiration of five (5) years
from the date such Option is granted.  Moreover, the aggregate Fair Market Value
(determined as of the time that option is granted) of the shares with respect to
which  Incentive  Stock  Options  are  exercisable  for  the  first  time by any
individual  employee  during any single  calendar  year under the Plan shall not
exceed  $100,000.  In addition,  in order to receive the full tax benefits of an
Incentive Stock Option, the employee must not resell or otherwise dispose of the
stock  acquired upon exercise of the Incentive  Stock Option until two (2) years
after the date the option was granted and one (1) year after it was exercised.

                  (f) EARLY TERMINATION OF OPTIONS. In the event a participant's
employment with or service to the Company shall terminate as the result of total
disability,  as defined below, or the result of retirement at 65 years of age or
later,  then any options  granted to such  participant  shall  expire and may no
longer be exercised three (3) months after such termination.  If the participant
dies while employed or engaged by the Company, to the extent that the option was
exercisable at the time of the participant's  death, such option may, within one
year after the  participant's  death,  be  exercised by the person or persons to
whom the  participant's  rights  under the  option  shall pass by will or by the
applicable laws of descent and distribution;  provided,  however, that an option
may not be  exercised  to any  extent  after  the  expiration  of the  option as
originally granted. In the event a participant's employment or engagement by the
Company  shall  terminate  as the result of any  circumstances  other than those
referred to above, whether terminated by the participant or the Company, with or
without  cause,  then all options  granted to such  participant  under this Plan
shall terminate and no longer be exercisable as of the date of such termination,
provided, however, that if an employee with an Incentive Stock Option terminates
employment prior to its exercise,  but notwithstanding  such termination becomes
or  remains  a  non-employee  advisor,   consultant  or  director  eligible  for
Nonqualified  Stock  Options  hereunder  or any other  stock  option plan of the
Company,  then the Incentive  Stock Option shall be converted to a  Nonqualified
Stock  Option  on the date the  Incentive  Stock  Option  would  otherwise  have
terminated.  A change in a  participant's  status from one eligible  category to
another (e.g., from an employee to a consultant) without a break

<PAGE>

in  service  shall  not  be  considered  a  termination  of  that  participant's
employment or engagement for purposes hereof.

                  An employee  who is absent from work with the Company  because
of total disability, as defined below, shall not by virtue of such absence alone
be deemed to have terminated such participant's employment with the Company. All
rights  which  such  participant  would  have had to  exercise  options  granted
hereunder  will be  suspended  during  the  period  of such  absence  and may be
exercised  cumulatively  by such  participant  upon his return to the Company so
long as such  rights  are  exercised  prior to the  expiration  of the option as
originally  granted.  For purposes of this Plan,  "total  disability" shall mean
disability,  as a  result  of  sickness  or  injury,  to  the  extent  that  the
participant is prevented from engaging in any substantial  gainful  activity and
is eligible for and receives a disability  benefit under Title II of the Federal
Social Security Act.

                  Notwithstanding  the  foregoing,  the  Committee  may,  in its
discretion,   permit  the  exercise  of  an  option  after   termination   of  a
participant's employment or engagement by the Company or during any absence from
work because of total disability.

                  (g) GRANTS TO COMMITTEE  MEMBERS.  The Committee shall have no
authority to make grants to its members hereunder, rather the Board of Directors
(with  members of the  Committee  abstaining)  shall have the  authority to make
grants  under this Plan to members of the  Committee.  Any  designation  of such
grants may be by means of a formula specified by the Board of Directors to award
grants  automatically  at a stated  time.  Nothing in this Section 5(g) shall be
interpreted to prohibit the Board of Directors  from granting  options or rights
to its members if the Board of Directors is administering the Plan in accordance
with Section 2(a) above.

                  6. STOCK APPRECIATION RIGHTS.

                  (a)  GRANT.  Stock  appreciation  rights may be granted by the
Committee under this Plan upon such terms and conditions as it may prescribe.  A
stock  appreciation right may be granted in connection with an option previously
granted  to or to be granted  under this Plan or may be granted by itself.  Each
stock  appreciation  right related to an option (a "Tandem  Right") shall become
nonexercisable  and be forfeited if the option to which it relates (the "Related
Option") is exercised.  "Stock  appreciation right" as used in this Plan means a
right to receive the excess of Fair Market Value, on the date of exercise,  of a
share of the Company's Common Stock on which an appreciation  right is exercised
over the  option  price  provided  for in the  related  option  and is issued in
consideration of

<PAGE>

services  performed for the Company or for its benefit by the participant.  Such
excess is hereafter called "the differential."

                  (b) EXERCISE OF STOCK APPRECIATION  RIGHTS. Stock appreciation
rights shall be exercisable and be payable in the following manner:

                                     (i) A stock  appreciation  right not issued
with a Related  Option (a "Separate  Right") shall be exercisable at the time or
times  prescribed by the  Committee.  A Tandem Right shall be exercisable by the
participant  at the  same  time or  times  that  the  Related  Option  could  be
exercised.  A participant  wishing to exercise a stock  appreciation right shall
give  written  notice of such  exercise  to the  Company.  Upon  receipt of such
notice,  the  Company  shall  determine,  in its sole  discretion,  whether  the
participant's  stock  appreciation  rights shall be paid in cash or in shares of
the Company's  Common Stock or any  combination of cash and shares and thereupon
shall,  without  deducting  any  transfer  or issue  tax,  deliver to the person
exercising such right an amount of cash or shares of the Company's  Common Stock
or a combination  thereof with a value equal to the  differential.  The date the
Company receives the written notice of exercise  hereunder is the exercise date.
The shares issued upon the exercise of a stock appreciation right may consist of
shares  of  the  Company's  authorized  but  unissued  Common  Stock  or of  its
authorized  and issued  Common Stock  reacquired  by the Company and held in its
treasury or any combination  thereof.  No fractional share of Common Stock shall
be issued;  rather, the Committee shall determine whether cash shall be given in
lieu of such  fractional  share  or  whether  such  fractional  share  shall  be
eliminated.

                                     (ii) The  exercise of a Tandem  Right shall
automatically  result in the surrender of the Related Option by the  participant
on a share for share  basis.  Likewise,  the  exercise of a stock  option  shall
automatically  result in the  surrender  of the  related  Tandem  Right.  Shares
covered by surrendered  options shall be available for granting  further options
under this Plan except to the extent and in the amount that such rights are paid
by the  Company  with  shares of stock,  as more  fully  discussed  in Section 4
hereof.

                                     (iii) The  Committee  may  impose any other
terms and  conditions  it prescribes  upon the exercise of a stock  appreciation
right,  which  conditions  may include a condition  that the stock  appreciation
right may only be exercised in accordance with rules and regulations  adopted by
the Committee from time to time.

                  (c)   LIMITATION  ON  PAYMENTS.   Notwithstanding   any  other
provision of this Plan, the Committee may from time to time determine, including
at the time of exercise,  the maximum amount of cash or stock which may be given

<PAGE>

upon exercise of any stock  appreciation right in any year;  provided,  however,
that all such  amounts  shall be paid in full no later  than the end of the year
immediately  following the year in which the  participant  exercised  such stock
appreciation  rights.  Any determination  under this paragraph may be changed by
the  Committee  from time to time provided that no such change shall require the
participant  to return to the  Company  any amount  theretofore  received  or to
extend the period  within  which the Company is required to make full payment of
the  amount  due as  the  result  of the  exercise  of the  participant's  stock
appreciation rights.

                  (d) Expiration or termination of stock appreciation rights.

                                     (i) Each  Tandem  Right and all  rights and
obligations  thereunder  shall  expire on the date on which the  Related  Option
expires or terminates.  Each Separate Right shall expire on the date  prescribed
by the Committee.

                  7. EFFECT OF CHANGES IN CAPITALIZATION

                           (a)  CHANGES  IN  COMMON  STOCK.  If  the  number  of
outstanding  shares of Common Stock is increased or decreased or changed into or
exchanged  for a different  number or kind of shares or other  securities of the
Company by reason of any  recapitalization,  reclassification,  stock  split-up,
combination of shares,  exchange of shares, stock dividend or other distribution
payable in capital stock,  or other increase or decrease in such shares effected
without receipt of consideration  by the Company,  occurring after the effective
date of the Plan, a proportionate  and appropriate  adjustment  shall be made by
the  Company  in the  number  and kind of  shares  for  which  options  or stock
appreciation rights are outstanding,  so that the proportionate  interest of the
participant  immediately  following such event shall, to the extent practicable,
be the  same as  immediately  prior  to  such  event.  Any  such  adjustment  in
outstanding  options  shall not change the  aggregate  option price payable with
respect to shares subject to the unexercised  portion of the option  outstanding
but shall include a corresponding  proportionate  adjustment in the option price
per share.  Similar adjustments shall be made to the terms of stock appreciation
rights.

                           (b)   REORGANIZATION   WITH  THE  COMPANY  SURVIVING.
Subject to Section 7(c) hereof,  if the Company shall be the surviving entity in
any  reorganization,  merger or  consolidation  of the Company  with one or more
other  entities,  any  option  theretofore  granted  pursuant  to the Plan shall
pertain to and apply to the securities to which a holder of the number of shares
of Common  Stock  subject to such option  would have been  entitled  immediately
following such  reorganization,  merger or  consolidation,  with a corresponding
proportionate  adjustment  of the option  price per share so that the  aggregate
option price

<PAGE>

thereafter  shall  be the  same as the  aggregate  option  price  of the  shares
remaining subject to the option immediately prior to such reorganization, merger
or  consolidation.  Similar  adjustments  shall  be made to the  terms  of stock
appreciation rights.

<PAGE>

                           (c) OTHER  REORGANIZATIONS,  SALE OF ASSETS OR COMMON
STOCK.  Upon the  dissolution or  liquidation of the Company,  or upon a merger,
consolidation or  reorganization  of the Company with one or more other entities
in  which  the  Company  is  not  the  surviving  entity,  or  upon  a  sale  of
substantially  all of the assets of the Company to another person or entity,  or
upon any transaction (including,  without limitation, a merger or reorganization
in which the Company is the surviving entity) approved by the Board that results
in any person or entity  (other  than  persons  who are  holders of stock of the
Company at the time the Plan is approved by the  Stockholders  and other than an
Affiliate) owning 80 percent or more of the combined voting power of all classes
of stock of the Company,  the Plan and all options and stock appreciation rights
outstanding hereunder shall terminate, except to the extent provision is made in
connection  with such  transaction  for the  continuation of the Plan and/or the
assumption of the options and stock appreciation rights theretofore  granted, or
for the  substitution  for such  options  and stock  appreciation  rights of new
options and stock appreciation  rights covering the stock of a successor entity,
or a parent or subsidiary thereof, with appropriate adjustments as to the number
and kinds of shares and exercise  prices,  in which event the Plan,  options and
stock appreciation  rights theretofore  granted shall continue in the manner and
under the terms so provided.  In the event of any such  termination of the Plan,
each  participant  shall have the right  (subject to the general  limitations on
exercise set forth in Section  5(d) hereof and except as otherwise  specifically
provided in the option agreement  relating to such option or stock  appreciation
right),  immediately prior to the occurrence of such termination and during such
period  occurring  prior  to  such  termination  as the  Committee  in its  sole
discretion shall designate,  to exercise such option or stock appreciation right
in whole or in part,  whether or not such option or stock appreciation right was
otherwise  exercisable at the time such termination  occurs,  but subject to any
additional provisions that the Committee may, in its sole discretion, include in
any option  agreement.  The Committee shall send written notice of an event that
will result in such a termination to all participants not later than the time at
which the Company gives notice thereof to its stockholders.

                           (d)  ADJUSTMENTS.  Adjustments  under this  Section 7
relating to stock or securities  of the Company shall be made by the  Committee,
whose determination in that respect shall be final and conclusive. No fractional
shares of Common Stock or units of other  securities shall be issued pursuant to
any such adjustment,  and any fractions resulting from any such adjustment shall
be  eliminated  in each case by rounding  downward to the nearest whole share or
unit.

<PAGE>

                           (e) NO LIMITATIONS ON COMPANY. The grant of an option
or stock  appreciation  right  pursuant to the Plan shall not affect or limit in
any  way  the   right   or   power   of  the   Company   to  make   adjustments,
reclassifications,  reorganizations  or  changes  of  its  capital  or  business
structure  or to  merge,  consolidate,  dissolve  or  liquidate,  or to  sell or
transfer all or any part of its business or assets.

                  8.  NONTRANSFERABILITY.  During a  participant's  lifetime,  a
right or an option  may be  exercisable  only by the  participant.  options  and
rights  granted under the Plan and the rights and privileges  conferred  thereby
shall not be subject to execution,  attachment or similar process and may not be
transferred,  assigned,  pledged  or  hypothecated  in any  manner  (whether  by
operation of law or otherwise)  other than by will or by the applicable  laws of
descent and distribution. Notwithstanding the foregoing, to the extent permitted
by applicable law and, if the Company has a class of securities registered under
the Exchange  Act, by Exchange Act Rule 16b-3,  the  Committee  may, in its sole
discretion,  (i) permit a recipient of a Nonqualified  Stock Option to designate
in  writing  during the  participant's  lifetime a  beneficiary  to receive  and
exercise  the  participant's  Nonqualified  Stock  Options  in the event of such
participant's death (as provided in Section 5(f)), (ii) grant Nonqualified Stock
Options that are  transferable  to the immediate  family,  a family trust of the
participant or any other legal entity in which  immediate  family members own or
hold the only interests and (iii) modify existing  Nonqualified Stock Options to
be transferable to the immediate family, a family trust or a family legal entity
of the participant.  Any other attempt to transfer,  assign, pledge, hypothecate
or otherwise  dispose of any option or right under the Plan,  or of any right or
privilege  conferred  thereby,  contrary to the  provisions of the Plan shall be
null and void.

                  9.  AMENDMENT,   SUSPENSION,   OR  TERMINATION  OF  PLAN.  The
Committee  or the Board of Directors  may at any time  suspend or terminate  the
Plan and may amend it from time to time in such  respects as the  Committee  may
deem advisable in order that options and rights granted  hereunder shall conform
to any change in the law, or in any other  respect  which the  Committee  or the
Board may deem to be in the best  interests of the Company;  provided,  however,
that no such amendment shall, without the participant's consent, alter or impair
any of the rights or obligations under any option or stock  appreciation  rights
theretofore  granted to him or her under the Plan; and provided  further that no
such amendment shall, without shareholder approval, increase the total number of
shares  available  for  grants of options  or rights  under the Plan  (except as
provided by Section 7 hereof).

                  10. EFFECTIVE DATE. The effective date of the Plan is December
14, 1995.

<PAGE>

                  11.  TERMINATION  DATE.  Unless  this  Plan  shall  have  been
previously  terminated by the Committee,  this Plan shall  terminate on December
14,  2005,  except as to stock,  options  and  rights  theretofore  granted  and
outstanding under the Plan at that date, and no stock,  option or right shall be
granted after that date.

                  12. RESALE OF SHARES  PURCHASED.  All shares of stock acquired
under this Plan may be freely  resold,  subject to applicable  state and federal
securities laws  restricting  their  transfer.  As a condition to exercise of an
option,  however,  the  Company  may  impose  various  conditions,  including  a
requirement  that the person  exercising such option represent and warrant that,
at the time of such  exercise,  the shares of Common Stock being  purchased  are
being  purchased for  investment  and not with a view to resale or  distribution
thereof.  In  addition,  the resale of shares  purchased  upon the  exercise  of
Incentive  Stock  Options may cause the employee to lose certain tax benefits if
the employee fails to comply with the holding period  requirements  described in
Section 5(e) hereof.

                  13.  ACCELERATION OF RIGHTS AND OPTIONS. If the Company or its
shareholders  enter into an agreement to dispose of all or substantially  all of
the  assets  or  stock  of the  Company  by  means  of a sale,  merger  or other
reorganization,  liquidation, or otherwise, any right or option granted pursuant
to the Plan shall become  immediately  and fully  exercisable  during the period
commencing  as of the date of the  agreement to dispose of all or  substantially
all of the assets or stock of the  Company and ending  when the  disposition  of
assets or stock  contemplated  by that agreement is consummated or the option is
otherwise  terminated in accordance with its provisions or the provisions of the
Plan,  whichever  occurs  first;  provided  that no  option  or  right  shall be
immediately exercisable under this Section on account of any agreement of merger
or other reorganization where the shareholders of the Company immediately before
the  consummation of the transaction  will own 50% or more of the total combined
voting power of all classes of stock  entitled to vote of the  surviving  entity
(whether the Company or some other entity) immediately after the consummation of
the  transaction.  In the event the  transaction  contemplated  by the agreement
referred  to in this  section  is not  consummated,  but  rather is  terminated,
canceled or expires,  the options and rights granted  pursuant to the Plan shall
thereafter  be treated as if that  agreement had never been entered into. In the
event any provision of the Plan or any option or right  granted  pursuant to the
Plan would  prevent the use of pooling of  interests  accounting  in a corporate
transaction  involving  the  Company and such  transaction  is  contingent  upon
pooling of interests accounting,  then that provision shall be deemed amended or
revoked to the extent  required  to  preserve  such  pooling of  interests.  The
Company may require in any agreement that an optionee who receives a grant under
the Plan shall,  upon advice from the Company,  take (or refrain from taking, as
appropriate)  all actions  necessary  or  desirable  to ensure  that  pooling of
interests accounting is available.

<PAGE>

                  14. WRITTEN NOTICE REQUIRED;  TAX  WITHHOLDING.  Any option or
right  granted  pursuant to the Plan shall be exercised  when written  notice of
that  exercise  by the  participant  has been  received  by the  Company  at its
principal office and, with respect to options,  when full payment for the shares
with respect to which the option is exercised  has been received by the Company.
By accepting a grant under the Plan, each participant agrees that, if and to the
extent  required by law,  the Company  shall  withhold or require the payment by
participant of any state,  federal or local taxes resulting from the exercise of
an option or right; provided,  however, that to the extent permitted by law, the
Committee (or, for Committee members,  the Board) may in its discretion,  permit
some or all of such  withholding  obligation  to be satisfied by the delivery by
the  participant  of, or the  retention by the Company of,  shares of its Common
Stock.

                  15.  COMPLIANCE  WITH  SECURITIES  LAWS.  Shares  shall not be
issued  with  respect to any option or right  granted  under the Plan unless the
exercise of that option and the  issuance  and  delivery of the shares  pursuant
thereto  shall  comply with all  relevant  provisions  of state and federal law,
including without  limitation the Securities Act of 1933, as amended,  the rules
and  regulations  promulgated  thereunder  and  the  requirements  of any  stock
exchange or automated  quotation system upon which shares of the Company's stock
may then be listed or traded,  and shall be further  subject to the  approval of
counsel  for  the  Company  with  respect  to  such  compliance.  Further,  each
participant  must  consent  to the  imposition  of a legend  on the  certificate
representing  the shares of Common  Stock issued upon the exercise of the option
or right restricting their transferability as may be required by law, the option
or right, or the Plan.

                  16.   WAIVER   OF   VESTING    RESTRICTIONS    BY   COMMITTEE.
Notwithstanding  any  provision  of the  Plan,  the  Committee  shall  have  the
discretion to waive any vesting  restrictions  on the  participant's  options or
rights, or the early termination thereof.

                  17. REPORTS TO PARTICIPANTS. The Company shall furnish to each
participant  a copy  of  the  annual  report,  if  any,  sent  to the  Company's
shareholders.   Upon  written  request,   the  Company  shall  furnish  to  each
participant a copy of its most recent annual report and each quarterly report to
shareholders issued since the end of the Company's most recent fiscal year.

                  18. NO EMPLOYEE CONTRACT.  The grant of restricted stock or an
option or right under the Plan shall not confer upon any  participant  any right
with respect to  continuation  of employment by, or the rendition of advisory or
consulting services to, the Company,  nor shall it interfere in any way with the
Company's  right to terminate  the  participant's  employment or services at any
time.

<PAGE>

                  As  adopted  by the  Board  of  Directors  of the  Company  on
December 14, 1995, as approved by  stockholders on July 26, 1996, as amended and
restated by the Board of Directors on October 25, 1997,  as amended and restated
by the Board of  Directors  on January 17, 1998 and as approved by  stockholders
(with  respect to the increase in the number of shares) on February 26, 1998, as
further  amended and  restated by the Board of  Directors on May 14, 1999 and as
approved  by the  stockholders  (with  respect to the  increase in the number of
shares) on June 16,  1999,  and as further  amended and restated by the Board of
Directors on December 16, 1999 and as approved by the stockholders (with respect
to the increase in the number of shares) on March 23, 2000.

                                           /S/ GRAEME BROWN, SECRETARY

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