Document:

<PAGE>   1
                                                                    EXHIBIT 4.1

                   [LOGO OF ARRAY BIOPHARMA INC. APPEARS HERE]

NUMBER                                                        SHARES

                              ARRAY BIOPHARMA INC.

SEE REVERSE FOR CERTAIN DEFINITIONS                           CUSIP
AND STATEMENTS AS TO THE RIGHTS,                                    -----------
PREFERENCES, PRIVILEGES AND RESTRICTIONS
ON SHARES

              INCORPORATED UNDER THE LAWS OF THE STATE OF DELAWARE

         This certifies that

is the owner of

fully paid and non-assessable shares of common stock, par value $.001 per share
of

                              ARRAY BIOPHARMA INC.
                   (the "Corporation"), a Delaware Corporation

         The shares represented by this certificate are transferable only on the
stock transfer books of the Corporation by the holder of record hereof or by
duly authorized attorney upon the surrender of this certificate properly
endorsed. This certificate is not valid until countersigned and registered by
the Corporation's transfer agent and registrar.

         IN WITNESS WHEREOF, the Corporation has caused this certificate to be
executed by the facsimile signatures of its duly authorized officers and has
caused a facsimile of its corporate seal to be hereunto affixed.

Dated:

                   [SEAL OF ARRAY BIOPHARMA INC. APPEARS HERE]

         TREASURER                                      PRESIDENT

COUNTERSIGNED AND REGISTERED

                                                            TRANSFER AGENT
                                                            AND REGISTRAR

BY
                                                        AUTHORIZED SIGNATURE

<PAGE>   2

         The Corporation is authorized to issue more than one class or series of
stock. The Corporation will furnish without charge to each stockholder who so
requests a statement of the powers, assignations, preferences and relative,
participating, optional or other special rights of each class of stock or series
thereof and the qualifications, limitations or restrictions of such preferences
and/or rights. Such request may be made to the Secretary of the Corporation.

         The following abbreviations, when used in the inscription on the face
of each certificate, shall be construed as though they were written out in full
according to applicable laws or regulations.

         TEN COM - as tenants in common
         TEN ENT - as tenants by the entireties
          JT TEN - as joint tenants with right
                   of survivorship and not as
                   tenants in common

        UNIT TRANSFER PIN ACT -                    Custodian
                                -------------------         --------------
                                      (Cust)                   (Minor)

                                            under Uniform Transfers to Minors
                                            Act
                                                 ------------------------------
                                                               (State)

         Additional abbreviations may also be used though not in the above list.

         For value received __________________ hereby sell(s), assign(s) and
transfer(s) unto

    PLEASE INSERT SOCIAL SECURITY OR OTHER
       IDENTIFYING NUMBER OF ASSIGNEE

--------------------------------------------------

--------------------------------------------------

-------------------------------------------------------------------------------

   (PLEASE PRINT OR TYPEWRITE NAME AND ADDRESS INCLUDING ZIP CODE OF ASSIGNEE)

<PAGE>   3

-------------------------------------------------------------------------------

-------------------------------------------------------------------------------

                                                         Shares
--------------------------------------------------------

of the common stock evidenced by this certificate, and do (does) hereby
irrevocably constitute and appoint

                                                        , Attorney,
--------------------------------------------------------

to transfer the said shares on the books of the Corporation, with full power of
substitution.

Dated
      --------------------------            -----------------------------------
                                                  Signature

                                                  -----------------------------
                                                  Signature

In presence of
              ------------------

NOTE: THE SIGNATURE TO THIS ASSIGNMENT MUST CORRESPOND WITH THE NAME OF THE
STOCKHOLDER(S) AS WRITTEN UPON THE FACE OF THE CERTIFICATE IN EVERY PARTICULAR,
WITHOUT ALTERATION OR ENLARGEMENT OR ANY CHANGE WHATEVER.<PAGE>   1
                                                                   EXHIBIT 10.2

-------------------------------------------------------------------------------

                              AMENDED AND RESTATED

                              ARRAY BIOPHARMA INC.

                        STOCK OPTION AND INCENTIVE PLAN
-------------------------------------------------------------------------------

<PAGE>   2

                               TABLE OF CONTENTS
<TABLE>
<CAPTION>
                                                                                                   PAGE
                                                                                                   ----
<S>                                                                                                 <C>
1.    PURPOSE........................................................................................1
2.    DEFINITIONS....................................................................................1
3.    ADMINISTRATION OF THE PLAN.....................................................................6
      3.1.     Board.................................................................................6
      3.2.     Committee.............................................................................6
      3.3.     Terms of Awards.......................................................................7
      3.4.     No Liability..........................................................................8
4.    STOCK SUBJECT TO THE PLAN......................................................................8
5.    EFFECTIVE DATE AND TERM OF THE PLAN............................................................8
      5.1.     Effective Date........................................................................8
      5.2.     Term..................................................................................9
6.    AWARD ELIGIBILITY..............................................................................9
      6.1.     Company or Subsidiary Employees; Service Providers; Other Persons.....................9
      6.2.     Successive Awards.....................................................................9
7.    LIMITATIONS ON GRANTS..........................................................................9
      7.1.     Limitation on Shares of Stock Subject to Awards and Cash Awards.......................9
      7.2.     Limitations on Incentive Stock Options................................................9
8.    AWARD AGREEMENT...............................................................................10
9.    OPTION PRICE..................................................................................10
10.   VESTING, TERM AND EXERCISE OF OPTIONS.........................................................10
      10.1.    Vesting..............................................................................10
      10.2.    Term.................................................................................11
      10.3.    Acceleration.........................................................................11
      10.4.    Termination of Service...............................................................11
      10.5.    Limitations on Exercise of Option....................................................11
      10.6.    Method of Exercise...................................................................11
      10.7.    Form of Payment......................................................................12
      10.8.    Rights of Holders of Options.........................................................12
      10.9.    Delivery of Stock Certificates.......................................................12
      10.10.   Reload Options.......................................................................13
11.   TRANSFERABILITY OF OPTIONS....................................................................13
      11.1.    Transferability of Options...........................................................13
      11.2.    Family Transfers.....................................................................13
12.   STOCK APPRECIATION RIGHTS.....................................................................14
      12.1.    Right to Payment.....................................................................14
      12.2.    Other Terms..........................................................................14
13.   RESTRICTED STOCK..............................................................................14
      13.1.    Grant of Restricted Stock or Restricted Stock Units..................................14
      13.2.    Restrictions.........................................................................14
      13.3.    Restricted Stock Certificates........................................................15

</TABLE>

                                   -i-

<PAGE>   3

<TABLE>
<S>                                                                                                 <C>
      13.4.    Rights of Holders of Restricted Stock................................................15
      13.5.    Rights of Holders of Restricted Stock Units..........................................15
      13.6.    Termination of Service...............................................................15
      13.7.    Delivery of Stock and Payment Therefor...............................................16
14.   DEFERRED STOCK AWARDS.........................................................................16
      14.1.    Nature of Deferred Stock Awards......................................................16
      14.2.    Election to Receive Deferred Stock Awards in Lieu of Compensation....................16
      14.3.    Rights as a Stockholder..............................................................17
      14.4.    Restrictions on Transfer.............................................................17
      14.5.    Termination..........................................................................17
15.   UNRESTRICTED STOCK AWARDS.....................................................................17
16.   PERFORMANCE STOCK AWARDS......................................................................17
      16.1.    Nature of Performance Stock Awards...................................................17
      16.2.    Rights as a Stockholder..............................................................18
      16.3.    Termination of Service...............................................................18
17.   DIVIDEND EQUIVALENT RIGHTS....................................................................18
      17.1.    Dividend Equivalent Rights...........................................................18
      17.2.    Interest Equivalents.................................................................19
      17.3.    Termination of Service...............................................................19
18.   CERTAIN PROVISIONS APPLICABLE TO AWARDS.......................................................19
      18.1.    Stand-Alone, Additional, Tandem, and Substitute Awards...............................19
      18.2.    Form and Timing of Payment Under Awards; Deferrals...................................19
      18.3.    Performance and Annual Incentive Awards..............................................20
               18.3.1. Performance Conditions.......................................................20
               18.3.2. Performance or Annual Incentive Awards Granted to Designated Covered
                       Employees....................................................................20
               18.3.3. Written Determinations.......................................................22
               18.3.4. Status of Section 18.3.2 Awards Under Code Section 162(m)....................22
19.   PARACHUTE LIMITATIONS.........................................................................23
20.   REQUIREMENTS OF LAW...........................................................................23
      20.1.    General..............................................................................23
      20.2.    Rule 16b-3...........................................................................24
      20.3.    Limitation Following a Hardship Distribution.........................................24
21.   AMENDMENT AND TERMINATION OF THE PLAN.........................................................25
22.   EFFECT OF CHANGES IN CAPITALIZATION...........................................................25
      22.1.    Changes in Stock.....................................................................25
      22.2.    Reorganization in Which the Company Is the Surviving
               Entity and in Which No Change in Control Occurs......................................26
      22.3.    Reorganization, Sale of Assets or Sale of Stock Which
               Involves a Change in Control.........................................................26
      22.4.    Adjustments..........................................................................26
      22.5.    No Limitations on Company............................................................27
23.   POOLING.......................................................................................27

</TABLE>

                                     -ii-

<PAGE>   4

<TABLE>

<S>                                                                                                 <C>
24.   DISCLAIMER OF RIGHTS...........................................................................27
25.   NONEXCLUSIVITY OF THE PLAN.....................................................................28
26.   WITHHOLDING TAXES..............................................................................28
27.   CAPTIONS.......................................................................................29
28.   OTHER PROVISIONS...............................................................................29
29.   NUMBER AND GENDER..............................................................................29
30.   SEVERABILITY...................................................................................29
31.   GOVERNING LAW..................................................................................29
</TABLE>

                                     -iii-

<PAGE>   5

                              AMENDED AND RESTATED

                              ARRAY BIOPHARMA INC.

                        STOCK OPTION AND INCENTIVE PLAN

         Array BioPharma Inc., a Delaware corporation (the "Company"), sets
forth herein the terms of the Company's Amended and Restated Stock Option and
Incentive Plan (the "Plan").

1.       PURPOSE

         The purpose of the Plan is to enhance the Company's ability to
attract, retain, and compensate highly qualified officers, key employees, and
other persons, and to motivate such officers, key employees, and other persons
to serve the Company and its Affiliates (as defined herein) and to expend
maximum effort to improve the business results and earnings of the Company, by
providing to such officers, key employees and other persons an opportunity to
acquire or increase a direct proprietary interest in the operations and future
success of the Company and with other financial incentives. To this end, the
Plan provides for the grant of stock options, stock appreciation rights,
restricted stock, restricted stock units, deferred stock awards, unrestricted
stock awards, performance stock awards, dividend equivalent rights, performance
awards and annual incentive awards in accordance with the terms hereof. Stock
options granted under the Plan may be non-qualified stock options or incentive
stock options, as provided herein.

2.       DEFINITIONS

         For purposes of interpreting the Plan and related documents (including
Award Agreements), the following definitions shall apply:

         2.1 "AFFILIATE" means, with respect to the Company, any company or
other trade or business that controls, is controlled by or is under common
control with the Company within the meaning of Rule 405 of Regulation C under
the Securities Act, including, without limitation, any Subsidiary.

         2.2 "ANNUAL INCENTIVE AWARD" means a conditional right granted to a
Grantee under SECTION 18.3.2 hereof to receive a cash payment, Stock or other
Award, unless otherwise determined by the Committee, after the end of a
specified fiscal year.

         2.3 "AWARD" means a grant of an Option, Stock Appreciation Right,
Restricted Stock, Restricted Stock Unit, Deferred Stock, Unrestricted Stock,

<PAGE>   6

Performance Stock, Dividend Equivalent Rights, Performance or Annual Incentive
Awards under the Plan.

         2.4 "AWARD AGREEMENT" means the written agreement between the Company
and a Grantee that evidences and sets out the terms and conditions of an Award.

         2.5 "BENEFIT ARRANGEMENT" shall have the meaning set forth in SECTION
19 hereof.

         2.6 "BOARD" means the Board of Directors of the Company.

         2.7 "CAUSE" means, as determined by the Board and unless otherwise
provided in an applicable employment agreement with the Company or an
Affiliate, (i) gross negligence or willful misconduct in connection with the
performance of duties; (ii) conviction of a criminal offense (other than minor
traffic offenses); or (iii) material breach of any term of any employment,
consulting or other services, confidentiality, intellectual property or
non-competition agreements, if any, between the Service Provider or employee
and the Company or an Affiliate.

         2.8 "CHANGE IN CONTROL" means (i) the dissolution or liquidation of
the Company or a merger, consolidation, or reorganization of the Company with
one or more other entities in which the Company is not the surviving entity,
(ii) a sale of substantially all of the assets of the Company to another person
or entity, or (iii) any transaction (including without limitation a merger or
reorganization in which the Company is the surviving entity) which results in
any person or entity (other than persons who are shareholders or Affiliates
immediately prior to the transaction) owning 50% or more of the combined voting
power of all classes of stock of the Company.

         2.9 "CODE" means the Internal Revenue Code of 1986, as now in effect
or as hereafter amended.

         2.10 "COMMITTEE" means a committee of, and designated from time to
time by resolution of, the Board, which shall consist of no fewer than two
members of the Board, none of whom shall be an officer or other salaried
employee of the Company or any Affiliate.

         2.11 "COMPANY" means the Array BioPharma Inc.

         2.12 "COVERED EMPLOYEE" means a Grantee who is a Covered Employee
within the meaning of Section 162(m)(3) of the Code.

                                      -2-
<PAGE>   7

         2.13 "DEFERRED STOCK" means a right, granted to a Grantee under
SECTION 14 hereof, to receive Stock, cash or a combination thereof at the end
of a specified deferral period."

         2.7 "DISABILITY" means the Grantee is unable to perform each of the
essential duties of such Grantee's position by reason of a medically
determinable physical or mental impairment which is potentially permanent in
character or which can be expected to last for a continuous period of not less
than 12 months; provided, however, that, with respect to rules regarding
expiration of an Incentive Stock Option following termination of the Grantee's
Service, Disability shall mean the Grantee is unable to engage in any
substantial gainful activity by reason of a medically determinable physical or
mental impairment which can be expected to result in death or which has lasted
or can be expected to last for a continuous period of not less than 12 months.

         2.14 "DIVIDEND EQUIVALENT" means a right, granted to a Grantee under
SECTION 17 hereof, to receive cash, Stock, other Awards or other property equal
in value to dividends paid with respect to a specified number of shares of
Stock, or other periodic payments.

         2.15 "EFFECTIVE DATE" of the Plan means the date of the closing of the
initial public offering of the Company's common stock.

         2.16 "EXCHANGE ACT" means the Securities Exchange Act of 1934, as now
in effect or as hereafter amended.

         2.17 "FAIR MARKET VALUE" means the value of a share of Stock,
determined as follows: if on the Grant Date or other determination date the
Stock is listed on an established national or regional stock exchange, is
admitted to quotation on The Nasdaq Stock Market, or is publicly traded on an
established securities market, the Fair Market Value of a share of Stock shall
be the closing price of the Stock on such exchange or in such market (if there
is more than one such exchange or market the Board shall determine the
appropriate exchange or market) on the Grant Date or such other determination
date (or if there is no such reported closing price, the Fair Market Value
shall be the mean between the highest bid and lowest asked prices or between
the high and low sale prices on such trading day) or, if no sale of Stock is
reported for such trading day, on the next preceding day on which any sale
shall have been reported. If the Stock is not listed on such an exchange,
quoted on such system or traded on such a market, Fair Market Value shall be
the value of the Stock as determined by the Board in good faith.

         2.18 "FAMILY MEMBER" means a person who is a spouse, child, stepchild,
grandchild, parent, stepparent, grandparent, sibling, niece, nephew,
mother-in-law, father-in-law, son-in-law, daughter-in-law, brother-in-law, or
sister-in-law, including adoptive relationships, of the Grantee, any person
sharing the Grantee's household

                                      -3-
<PAGE>   8

(other than a tenant or employee), a trust in which any one or more these
persons have more than fifty percent of the beneficial interest, a foundation
in which any one or more of these persons (or the Grantee) control the
management of assets, and any other entity in which one or more these persons
(or the Grantee) own more than fifty percent of the voting interests.

         2.19 "GRANT DATE" means, as determined by the Board or authorized
Committee, the latest to occur of (i) the date as of which the Board approves
an Award, (ii) the date on which the recipient of an Award first becomes
eligible to receive an Award under SECTION 6 hereof, or (iii) such other date
as may be specified by the Board.

         2.20 "GRANTEE" means a person who receives or holds an Award under the
Plan.

         2.21 "INCENTIVE STOCK OPTION" means an "incentive stock option" within
the meaning of Section 422 of the Code, or the corresponding provision of any
subsequently enacted tax statute, as amended from time to time.

         2.22 "NON-QUALIFIED STOCK OPTION" means an Option that is not an
Incentive Stock Option.

         2.23 "OPTION" means an option to purchase one or more shares of Stock
pursuant to the Plan.

         2.24 "OPTION PRICE" means the purchase price for each share of Stock
subject to an Option.

         2.25 "OTHER AGREEMENT" shall have the meaning set forth in SECTION 19
hereof.

         2.26 "OUTSIDE DIRECTOR" means a member of the Board who is not an
officer or employee of the Company.

         2.27 "PERFORMANCE AWARD" means a conditional right granted to a
Grantee under SECTION 18.3 hereof to receive a cash payment, Stock or other
Award, unless otherwise determined by the Committee, after the end of a period
of up to 10 years.

         2.28 "PERFORMANCE STOCK AWARD" means Awards granted pursuant to
SECTION 16.

         2.29 "PLAN" means this Amended and Restated Array BioPharma Inc. Stock
Option and Incentive Plan.

                                      -4-
<PAGE>   9

         2.30 "REPORTING PERSON" means a person who is required to file reports
under Section 16(a) of the Exchange Act.

         2.31 "RESTRICTED PERIOD" means the period during which Restricted
Stock or Restricted Stock Units are subject to restrictions or conditions
pursuant to SECTION 13.2 hereof.

         2.32 "RESTRICTED STOCK" means shares of Stock, awarded to a Grantee
pursuant to SECTION 13 hereof, that are subject to restrictions and to a risk
of forfeiture.

         2.33 "RESTRICTED STOCK UNIT" means a unit awarded to a Grantee
pursuant to SECTION 13 hereof, which represents a conditional right to receive
a share of Stock in the future, and which is subject to restrictions and to a
risk of forfeiture.

         2.34 "SECURITIES ACT" means the Securities Act of 1933, as now in
effect or as hereafter amended.

         2.35 "SERVICE" means service as an employee, officer, director or
other Service Provider of the Company or an Affiliate. Unless otherwise stated
in the applicable Award Agreement, a Grantee's change in position or duties
shall not result in interrupted or terminated Service, so long as such Grantee
continues to be an employee, officer, director or other Service Provider of the
Company or an Affiliate. Subject to the preceding sentence, whether a
termination of Service shall have occurred for purposes of the Plan shall be
determined by the Board, which determination shall be final, binding and
conclusive.

         2.36 "SERVICE PROVIDER" means a consultant or adviser to the Company,
a manager of the Company's properties or affairs, or other similar service
provider or Affiliate, and employees of any of the foregoing, as such persons
may be designated from time to time by the Board pursuant to SECTION 6 hereof.

         2.37 "STOCK" means the common stock, par value $.001 per share, of the
Company.

         2.38 "STOCK APPRECIATION RIGHT" or "SAR" means a right granted to a
Grantee under SECTION 12 hereof.

         2.39 "SUBSIDIARY" means any "subsidiary corporation" of the Company
within the meaning of Section 424(f) of the Code.

         2.40 "TERMINATION DATE" means the date upon which an Option shall
terminate or expire, as set forth in SECTION 10.2 hereof.

                                      -5-
<PAGE>   10

         2.41 "UNRESTRICTED STOCK AWARD" means an Award granted pursuant to
SECTION 15 hereof.

3.       ADMINISTRATION OF THE PLAN

         3.1. BOARD

         The Board shall have such powers and authorities related to the
administration of the Plan as are consistent with the Company's certificate of
incorporation and by-laws and applicable law. The Board shall have full power
and authority to take all actions and to make all determinations required or
provided for under the Plan, any Award or any Award Agreement, and shall have
full power and authority to take all such other actions and make all such other
determinations not inconsistent with the specific terms and provisions of the
Plan that the Board deems to be necessary or appropriate to the administration
of the Plan, any Award or any Award Agreement. All such actions and
determinations shall be by the affirmative vote of a majority of the members of
the Board present at a meeting or by unanimous consent of the Board executed in
writing in accordance with the Company's certificate of incorporation and
by-laws and applicable law. The interpretation and construction by the Board of
any provision of the Plan, any Award or any Award Agreement shall be final and
conclusive. To the extent permitted by law, the Board may delegate its
authority under the Plan to a member of the Board or to an executive officer of
the Company who is a member of the Board.

         3.2. COMMITTEE.

         The Board from time to time may delegate to a Committee such powers
and authorities related to the administration and implementation of the Plan,
as set forth in SECTION 3.1 above and in other applicable provisions, as the
Board shall determine, consistent with the certificate of incorporation and
by-laws of the Company and applicable law. In the event that the Plan, any
Award or any Award Agreement entered into hereunder provides for any action to
be taken by or determination to be made by the Board, such action may be taken
or such determination may be made by the Committee if the power and authority
to do so has been delegated to the Committee by the Board as provided for in
this Section. Unless otherwise expressly determined by the Board, any such
action or determination by the Committee shall be final, binding and
conclusive. To the extent permitted by law, the Committee may delegate its
authority under the Plan to a member of the Board or an executive officer of
the Company who is a member of the Board.

                                      -6-
<PAGE>   11

         3.3. TERMS OF AWARDS.

         Subject to the other terms and conditions of the Plan, the Board shall
have full and final authority:

         (i)   to designate Grantees,

         (ii)  to determine the type or types of Awards to be made to a Grantee,

         (iii) to determine the number of shares of Stock to be subject to an
               Award,

         (iv) to establish the terms and conditions of each Award (including,
but not limited to, the exercise price of any Option, the nature and duration
of any restriction or condition (or provision for lapse thereof) relating to
the vesting, exercise, transfer, or forfeiture of an Award or the shares of
Stock subject thereto, and any terms or conditions that may be necessary to
qualify Options as Incentive Stock Options),

         (v) to prescribe the form of each Award Agreement evidencing an Award,

         (vi) to amend, modify, or supplement the terms of any outstanding
Award, and

         (vii) Such authority specifically includes the authority, in order to
effectuate the purposes of the Plan but without amending the Plan, to modify
Awards to eligible individuals who are foreign nationals or are individuals who
are employed outside the United States to recognize differences in local law,
tax policy, or custom.

         As a condition to any subsequent Award, the Board shall have the
right, at its discretion, to require Grantees to return to the Company Awards
previously made under the Plan. Subject to the terms and conditions of the
Plan, any such new Award shall be upon such terms and conditions as are
specified by the Board at the time the new Award is made. The Board shall have
the right, in its discretion, to make Awards in substitution or exchange for
any other award under another plan of the Company, any Affiliate, or any
business entity to be acquired by the Company or an Affiliate. The Company may
retain the right in an Award Agreement to cause a forfeiture of the gain
realized by a Grantee on account of actions taken by the Grantee in violation
or breach of or in conflict with any non-competition agreement, any agreement
prohibiting solicitation of employees or clients of the Company or any
Affiliate thereof or any confidentiality obligation with respect to the Company
or any Affiliate thereof or otherwise in competition with the Company or any
Affiliate thereof, to the extent specified in such Award Agreement applicable
to the Grantee. Furthermore, the Company may annul an Award if the Grantee is
an employee of the Company or an Affiliate thereof and is terminated for Cause
as defined in the applicable Award Agreement or the Plan, as applicable. The
grant of any Award shall be contingent upon the Grantee executing the
appropriate Award Agreement.

                                      -7-
<PAGE>   12

         3.4. NO LIABILITY.

         No member of the Board or of the Committee shall be liable for any
action or determination made in good faith with respect to the Plan or any
Award or Award Agreement.

4.       STOCK SUBJECT TO THE PLAN

         Subject to adjustment as provided in SECTION 22 hereof, the number of
shares of Stock available for issuance under the Plan shall be 7,000,000, which
number shall be increased, but not decreased, by any "Additional Authorized
Shares." Additional Authorized Shares, for purposes of the Plan, means on any
given day the difference between (1) the Company's issued and outstanding
shares of Stock (on a fully diluted, as converted basis) multiplied by a factor
of 25% minus (2) the number of outstanding shares of Stock relating to Awards
plus the number of shares of Stock available for future grants of Awards on
such date. The number of shares of Stock available for issuance under the Plan
as incentive stock options may not exceed 7,000,000 shares, which number shall
be increased each January 1 for the next five years beginning in 2001 by
250,000 shares; provided, that, at no time may the number of shares of Stock
available for issuance under the Plan as incentive stock options exceed the
total number of shares reserved for issuance under the Plan. If any shares
covered by an Award are not purchased or are forfeited, or if an Award
otherwise terminates without delivery of any Stock subject thereto, then the
number of shares of Stock counted against the aggregate number of shares
available under the Plan with respect to such Award shall, to the extent of any
such forfeiture or termination, again be available for making Awards under the
Plan. If the exercise price of any Option granted under the Plan is satisfied
by tendering shares of Stock to the Company (by either actual delivery or by
attestation), only the number of shares of Stock issued net of the shares of
Stock tendered shall be deemed delivered for purposes of determining the
maximum number of shares of Stock available for delivery under the Plan.

5.       EFFECTIVE DATE AND TERM OF THE PLAN

         5.1. EFFECTIVE DATE.

         The Plan shall be effective as of the Effective Date, subject to
approval of the Plan by the Company's stockholders within one year of the
Effective Date. Upon approval of the Plan by the stockholders of the Company as
set forth above, all Awards made under the Plan on or after the Effective Date
shall be fully effective as if the stockholders of the Company had approved the
Plan on the Effective Date. If the stockholders fail to approve the Plan within
one year after the Effective Date, any Awards made hereunder shall be null and
void and of no effect.

                                      -8-
<PAGE>   13

         5.2. TERM.

         The Plan shall terminate automatically ten (10) years after its
adoption by the Board and may be terminated on any earlier date as provided in
SECTION 21.

6.       AWARD ELIGIBILITY

         6.1. COMPANY OR SUBSIDIARY EMPLOYEES; SERVICE PROVIDERS; OTHER
PERSONS.

         Subject to Section 7, Awards may be made under the Plan to: (i) any
employee of, or a Service Provider to, the Company or of any Affiliate,
including any such employee or Service Provider who is an officer or director
of the Company, or of any affiliate, as the Board shall determine and designate
from time to time, (ii) any Outside Director, and (iii) any other individual
whose participation in the Plan is determined to be in the best interests of
the Company by the Board.

         6.2. SUCCESSIVE AWARDS.

         An eligible person may receive more than one Award, subject to such
restrictions as are provided herein.

7.       LIMITATIONS ON GRANTS

         7.1. LIMITATION ON SHARES OF STOCK SUBJECT TO AWARDS AND CASH AWARDS.

         During any time when the Company has a class of equity security
registered under Section 12 of the Exchange Act, the maximum number of shares
of Stock subject to Options that can be awarded under the Plan to any person
eligible for an Award under SECTION 6 hereof is two million (2,000,000) per
year. During any time when the Company has a class of equity security
registered under Section 12 of the Exchange Act, the maximum number of shares
that can be awarded under the Plan, other than pursuant to an Option to any
person eligible for an Award under SECTION 6 hereof is four hundred thousand
(400,000) per year. The preceding limitations in this SECTION 7.1 are subject
to adjustment as provided in SECTION 22 hereof. The maximum amount that may be
earned as an Annual Incentive Award or other cash Award in any fiscal year by
any one Grantee shall be $1,000,000 and the maximum amount that may be earned
as a Performance Award or other cash Award in respect of a performance period
by any one Grantee shall be $3,000,000.

         7.2. LIMITATIONS ON INCENTIVE STOCK OPTIONS.

         An Option shall constitute an Incentive Stock Option only (i) if the
Grantee of such Option is an employee of the Company or any Subsidiary of the
Company; (ii) to the extent specifically provided in the related Award
Agreement; and (iii) to the

                                      -9-
<PAGE>   14

extent that the aggregate Fair Market Value (determined at the time the Option
is granted) of the shares of Stock with respect to which all Incentive Stock
Options held by such Grantee become exercisable for the first time during any
calendar year (under the Plan and all other plans of the Grantee's employer and
its Affiliates) does not exceed $100,000. This limitation shall be applied by
taking Options into account in the order in which they were granted.

8.       AWARD AGREEMENT

         Each Award granted pursuant to the Plan shall be evidenced by an Award
Agreement, to be executed by the Company and by the Grantee, in such form or
forms as the Board shall from time to time determine. Award Agreements granted
from time to time or at the same time need not contain similar provisions but
shall be consistent with the terms of the Plan. Each Award Agreement evidencing
an Award of Options shall specify whether such Options are intended to be
Non-qualified Stock Options or Incentive Stock Options, and in the absence of
such specification such options shall be deemed Non-qualified Stock Options.

9.       OPTION PRICE

         The Option Price of each Option shall be fixed by the Board and stated
in the Award Agreement evidencing such Option. The Option Price shall be at
least the aggregate Fair Market Value on the Grant Date of the shares of Stock
subject to the Option; provided, however, that in the event that a Grantee
would otherwise be ineligible to receive an Incentive Stock Option by reason of
the provisions of Sections 422(b)(6) and 424(d) of the Code (relating to
ownership of more than ten percent of the Company's outstanding Stock), the
Option Price of an Option granted to such Grantee that is intended to be an
Incentive Stock Option shall be not less than the greater of the par value of a
share of Stock or 110 percent of the Fair Market Value of a share of Stock on
the Grant Date. In no case shall the Option Price of any Option be less than
the par value of a share of Stock.

10.      VESTING, TERM AND EXERCISE OF OPTIONS

         10.1. VESTING.

         Subject to SECTIONS 10.2 AND 22.3 hereof, each Option granted under
the Plan shall become exercisable at such times and under such conditions as
shall be determined by the Board and stated in the Award Agreement. For
purposes of this SECTION 10.1, fractional numbers of shares of Stock subject to
an Option shall be rounded down to the next nearest whole number. The Board may
provide, for example, in the Award Agreement for (i) accelerated exercisability
of the Option in the event the Grantee's Service terminates on account of
death, Disability or another event, (ii) expiration of the Option prior to its
term in the event of the termination of the Grantee's Service, (iii) immediate
forfeiture of the Option in the

                                     -10-
<PAGE>   15

event the Grantee's Service is terminated for Cause or (iv) unvested Options to
be exercised subject to the Company's right of repurchase with respect to
unvested shares of Stock.

         10.2. TERM.

         Each Option granted under the Plan shall terminate, and all rights to
purchase shares of Stock thereunder shall cease, upon the expiration of ten
years from the date such Option is granted, or under such circumstances and on
such date prior thereto as is set forth in the Plan or as may be fixed by the
Board and stated in the Award Agreement relating to such Option (the
"Termination Date"); provided, however, that in the event that the Grantee
would otherwise be ineligible to receive an Incentive Stock Option by reason of
the provisions of Sections 422(b)(6) and 424(d) of the Code (relating to
ownership of more than ten percent of the outstanding Stock), an Option granted
to such Grantee that is intended to be an Incentive Stock Option shall not be
exercisable after the expiration of five years from its Grant Date.

         10.3. ACCELERATION.

         Any limitation on the exercise of an Option contained in any Award
Agreement may be rescinded, modified or waived by the Board, in its sole
discretion, at any time and from time to time after the Grant Date of such
Option, so as to accelerate the time at which the Option may be exercised.
Notwithstanding any other provision of the Plan, no Option shall be exercisable
in whole or in part prior to the date the Plan is approved by the stockholders
of the Company as provided in SECTION 5.1 hereof.

         10.4. TERMINATION OF SERVICE.

         Each Award Agreement shall set forth the extent to which the Grantee
shall have the right to exercise the Option following termination of the
Grantee's Service. Such provisions shall be determined in the sole discretion
of the Board, need not be uniform among all Options issued pursuant to the
Plan, and may reflect distinctions based on the reasons for termination of
Service.

         10.5. LIMITATIONS ON EXERCISE OF OPTION.

         Notwithstanding any other provision of the Plan, in no event may any
Option be exercised, in whole or in part, prior to the date the Plan is
approved by the stockholders of the Company as provided herein, or after ten
years following the Grant Date, or after the occurrence of an event referred to
in SECTION 22 hereof which results in termination of the Option.

         10.6. METHOD OF EXERCISE.

         An Option that is exercisable may be exercised by the Grantee's
delivery to the Company of written notice of exercise on any business day, at
the Company's principal office, on the form specified by the Company. Such
notice shall specify the

                                     -11-
<PAGE>   16

number of shares of Stock with respect to which the Option is being exercised
and shall be accompanied by payment in full of the Option Price of the shares
for which the Option is being exercised. The minimum number of shares of Stock
with respect to which an Option may be exercised, in whole or in part, at any
time shall be the lesser of (i) 100 shares or such lesser number set forth in
the applicable Award Agreement and (ii) the maximum number of shares available
for purchase under the Option at the time of exercise.

         10.7. FORM OF PAYMENT.

         Payment of the Option Price for the shares purchased pursuant to the
exercise of an Option shall be made (i) in cash or in cash equivalents
acceptable to the Company; (ii) through the tender to the Company of shares of
Stock, which shares, if acquired from the Company, shall have been held for at
least six months and which shall be valued, for purposes of determining the
extent to which the Option Price has been paid thereby, at their Fair Market
Value on the date of exercise; or (iii) by a combination of the methods
described in (i) and (ii). Unless the Board provides otherwise in the Award
Agreement, payment in full of the Option Price need not accompany the written
notice of exercise provided that the notice of exercise directs that the
certificate or certificates for the shares of Stock for which the Option is
exercised be delivered to a licensed broker acceptable to the Company as the
agent for the individual exercising the Option and, at the time such
certificate or certificates are delivered, the broker tenders to the Company
cash (or cash equivalents acceptable to the Company) equal to the Option Price
for the shares of Stock purchased pursuant to the exercise of the Option plus
the amount (if any) of federal and/or other taxes which the Company may in its
judgment, be required to withhold with respect to the exercise of the Option.
An attempt to exercise any Option granted hereunder other than as set forth
above shall be invalid and of no force and effect.

         10.8. RIGHTS OF HOLDERS OF OPTIONS.

         Unless otherwise stated in the applicable Award Agreement, an
individual holding or exercising an Option shall have none of the rights of a
shareholder (for example, the right to receive cash or dividend payments or
distributions attributable to the subject shares of Stock or to direct the
voting of the subject shares of Stock ) until the shares of Stock covered
thereby are fully paid and issued to him. Except as provided in SECTION 22
hereof, no adjustment shall be made for dividends, distributions or other
rights for which the record date is prior to the date of such issuance.

         10.9. DELIVERY OF STOCK CERTIFICATES.

         Promptly after the exercise of an Option by a Grantee and the payment
in full of the Option Price, such Grantee shall be entitled to the issuance of
a stock certificate or certificates evidencing his or her ownership of the
shares of Stock subject to the Option.

                                     -12-
<PAGE>   17

         10.10. RELOAD OPTIONS.

         At the discretion of the Board and subject to such restrictions, terms
and conditions as the Board may establish, Options granted under the Plan may
include a "reload" feature pursuant to which a Grantee exercising an Option by
the delivery of a number of shares of Stock in accordance with SECTION 10.7
hereof would automatically be granted an additional Option (with an exercise
price equal to the Fair Market Value of the Stock on the date the additional
Option is granted and with such other terms as the Board may provide) to
purchase that number of shares of Stock equal to the number delivered to
exercise the original Option with an Option term equal to the remainder of the
original Option term unless the Board otherwise determines in the Option Award
Agreement for the original grant.

11.      TRANSFERABILITY OF OPTIONS

         11.1. TRANSFERABILITY OF OPTIONS

         Except as provided in SECTION 11.2, during the lifetime of a Grantee,
only the Grantee (or, in the event of legal incapacity or incompetency, the
Grantee's guardian or legal representative) may exercise an Option. Except as
provided in SECTION 11.2, no Option shall be assignable or transferable by the
Grantee to whom it is granted, other than by will or the laws of descent and
distribution.

         11.2. FAMILY TRANSFERS.

         If authorized in the applicable Award Agreement, a Grantee may
transfer, not for value, all or part of an Option which is not an Incentive
Stock Option to any Family Member. For the purpose of this SECTION 11.2, a "not
for value" transfer is a transfer which is (i) a gift, (ii) a transfer under a
domestic relations order in settlement of marital property rights; or (iii) a
transfer to an entity in which more than fifty percent of the voting interests
are owned by Family Members (or the Grantee) in exchange for an interest in
that entity. Following a transfer under this SECTION 11.2, any such Option
shall continue to be subject to the same terms and conditions as were
applicable immediately prior to transfer. Subsequent transfers of transferred
Options are prohibited except to Family Members of the original Grantee in
accordance with this SECTION 11.2 or by will or the laws of descent and
distribution. The events of termination of Service of SECTION 10.4 hereof shall
continue to be applied with respect to the original Grantee, following which
the Option shall be exercisable by the transferee only to the extent, and for
the periods specified, in SECTION 10.4.

                                     -13-
<PAGE>   18

12.      STOCK APPRECIATION RIGHTS

         The Board is authorized to grant SARs to Grantees on the following
terms and conditions:

         12.1. RIGHT TO PAYMENT.

         A SAR shall confer on the Grantee to whom it is granted a right to
receive, upon exercise thereof, the excess of (A) the Fair Market Value of one
share of Stock on the date of exercise over (B) the grant price of the SAR as
determined by the Board. The grant price of an SAR shall not be less than the
Fair Market Value of a share of Stock on the date of grant except as provided
in SECTION 18.1.

         12.2. OTHER TERMS.

         The Board shall determine at the date of grant or thereafter, the time
or times at which and the circumstances under which a SAR may be exercised in
whole or in part (including based on achievement of performance goals and/or
future service requirements), the time or times at which SARs shall cease to be
or become exercisable following termination of Service or upon other
conditions, the method of exercise, method of settlement, form of consideration
payable in settlement, method by or forms in which Stock will be delivered or
deemed to be delivered to Grantees, whether or not a SAR shall be in tandem or
in combination with any other Award, and any other terms and conditions of any
SAR. SARs may be either freestanding or in tandem with other Awards.

13.      RESTRICTED STOCK

         13.1. GRANT OF RESTRICTED STOCK OR RESTRICTED STOCK UNITS.

         The Board may from time to time grant Restricted Stock or Restricted
Stock Units to persons eligible to receive Awards under SECTION 6 hereof,
subject to such restrictions, conditions and other terms as the Board may
determine.

         13.2. RESTRICTIONS.

         At the time a grant of Restricted Stock or Restricted Stock Units is
made, the Board shall establish a period of time (the "Restricted Period")
applicable to such Restricted Stock or Restricted Stock Units. Each Award of
Restricted Stock or Restricted Stock Units may be subject to a different
Restricted Period. The Board may, in its sole discretion, at the time a grant
of Restricted Stock or Restricted Stock Units is made, prescribe restrictions
in addition to or other than the expiration of the Restricted Period, including
the satisfaction of corporate or individual performance objectives, which may
be applicable to all or any portion of the Restricted Stock or Restricted Stock
Units in accordance with SECTION 18.3.1 and 18.3.2. Neither Restricted Stock
nor Restricted Stock Units may be sold, transferred, assigned,

                                     -14-
<PAGE>   19

pledged or otherwise encumbered or disposed of during the Restricted Period or
prior to the satisfaction of any other restrictions prescribed by the Board
with respect to such Restricted Stock or Restricted Stock Units.

         13.3. RESTRICTED STOCK CERTIFICATES.

         The Company shall issue, in the name of each Grantee to whom
Restricted Stock has been granted, stock certificates representing the total
number of shares of Restricted Stock granted to the Grantee, as soon as
reasonably practicable after the Grant Date. The Board may provide in an Award
Agreement that either (i) the Secretary of the Company shall hold such
certificates for the Grantee's benefit until such time as the Restricted Stock
is forfeited to the Company or the restrictions lapse, or (ii) such
certificates shall be delivered to the Grantee, provided, however, that such
certificates shall bear a legend or legends that complies with the applicable
securities laws and regulations and makes appropriate reference to the
restrictions imposed under the Plan and the Award Agreement.

         13.4. RIGHTS OF HOLDERS OF RESTRICTED STOCK.

         Unless the Board otherwise provides in an Award Agreement, holders of
Restricted Stock shall have the right to vote such Stock and the right to
receive any dividends declared or paid with respect to such Stock. The Board
may provide that any dividends paid on Restricted Stock must be reinvested in
shares of Stock, which may or may not be subject to the same vesting conditions
and restrictions applicable to such Restricted Stock. All distributions, if
any, received by a Grantee with respect to Restricted Stock as a result of any
stock split, stock dividend, combination of shares, or other similar
transaction shall be subject to the restrictions applicable to the original
Grant.

         13.5. RIGHTS OF HOLDERS OF RESTRICTED STOCK UNITS.

         Unless the Board otherwise provides in an Award Agreement, holders of
Restricted Stock Units shall have no rights as stockholders of the Company. The
Board may provide in an Award Agreement evidencing a grant of Restricted Stock
Units that the holder of such Restricted Stock Units shall be entitled to
receive, upon the Company's payment of a cash dividend on its outstanding
Stock, a cash payment for each Restricted Stock Unit held equal to the
per-share dividend paid on the Stock. Such Award Agreement may also provide
that such cash payment will be deemed reinvested in additional Restricted Stock
Units at a price per unit equal to the Fair Market Value of a share of Stock on
the date that such dividend is paid.

         13.6. TERMINATION OF SERVICE.

         Unless the Board otherwise provides in an Award Agreement or in
writing after the Award Agreement is issued, upon the termination of a
Grantee's Service, any Restricted Stock or Restricted Stock Units held by such
Grantee that have not vested, or with respect to which all applicable
restrictions and conditions have not

                                     -15-
<PAGE>   20

lapsed, shall immediately be deemed forfeited. Upon forfeiture of Restricted
Stock or Restricted Stock Units, the Grantee shall have no further rights with
respect to such Award, including but not limited to any right to vote
Restricted Stock or any right to receive dividends with respect to shares of
Restricted Stock or Restricted Stock Units.

         13.7. DELIVERY OF STOCK AND PAYMENT THEREFOR.

         Upon the expiration or termination of the Restricted Period and the
satisfaction of any other conditions prescribed by the Board, the restrictions
applicable to shares of Restricted Stock or Restricted Stock Units shall lapse,
and, unless otherwise provided in the Award Agreement, upon payment by the
Grantee to the Company, in cash or by check, of the aggregate par value of the
shares of Stock represented by such Restricted Stock or Restricted Stock Units
(or such other higher purchase price determined by the Board), a stock
certificate for such shares shall be delivered, free of all such restrictions,
to the Grantee or the Grantee's beneficiary or estate, as the case may be.

14.      DEFERRED STOCK AWARDS

         14.1. NATURE OF DEFERRED STOCK AWARDS.

         A Deferred Stock Award is an Award of phantom stock units to a
Grantee, subject to restrictions and conditions as the Board may determine at
the time of grant. Conditions may be based on continuing Service and/or
achievement of pre-established performance goals and objectives. The terms and
conditions of each such agreement shall be determined by the Board, and such
terms and conditions may differ among individual Awards and Grantees. At the
end of the deferral period, the Deferred Stock Award, to the extent vested,
shall be paid to the Grantee in the form of shares of Stock.

         14.2. ELECTION TO RECEIVE DEFERRED STOCK AWARDS IN LIEU OF
               COMPENSATION.

         The Board may, in its sole discretion, permit a Grantee to elect to
receive a portion of the cash compensation or Restricted Stock Award otherwise
due to such Grantee in the form of a Deferred Stock Award. Any such election
shall be made in writing and shall be delivered to the Company no later than
the date specified by the Board and in accordance with rules and procedures
established by the Board. The Board shall have the sole right to determine
whether and under what circumstances to permit such elections and to impose
such limitations and other terms and conditions thereon as the Board deems
appropriate.

                                     -16-
<PAGE>   21

         14.3. RIGHTS AS A STOCKHOLDER.

         During the deferral period, a Grantee shall have no rights as a
stockholder; provided, however, that the Grantee may be credited with Dividend
Equivalent Rights with respect to the phantom stock units underlying his
Deferred Stock Award, subject to such terms and conditions as the Board may
determine.

         14.4. RESTRICTIONS ON TRANSFER.

         A Deferred Stock Award may not be sold, assigned, transferred, pledged
or otherwise encumbered or disposed of during the deferral period.

         14.5. TERMINATION.

         Except as may otherwise be provided by the Board either in the Award
Agreement or, in writing after the Award Agreement is issued, a Grantee's right
in all Deferred Stock Awards that have not vested shall automatically terminate
upon the Grantee's termination of Service for any reason.

15.      UNRESTRICTED STOCK AWARDS

         The Board may, in its sole discretion, grant (or sell at par value or
such other higher purchase price determined by the Board) an Unrestricted Stock
Award to any Grantee pursuant to which such Grantee may receive shares of Stock
free of any restrictions ("Unrestricted Stock") under the Plan. Unrestricted
Stock Awards may be granted or sold as described in the preceding sentence in
respect of past services or other valid consideration, or in lieu of any cash
compensation due to such Grantee.

16.      PERFORMANCE STOCK AWARDS

         16.1. NATURE OF PERFORMANCE STOCK AWARDS.

         A Performance Stock Award is an Award entitling the recipient to
acquire shares of Stock upon the attainment of specified performance goals. The
Board may make Performance Stock Awards independent of or in connection with
the granting of any other Award under the Plan. The Board in its sole
discretion shall determine whether and to whom Performance Stock Awards shall
be made, the performance goals applicable under each such Award, the periods
during which performance is to be measured, and all other limitations and
conditions applicable to the awarded Performance Stock; provided, however, that
the Board may rely on the performance goals and other standards applicable to
other performance unit plans of the Company in setting the standards for
Performance Stock Awards under the Plan.

                                     -17-
<PAGE>   22

At any time prior to the Grantee's termination of Service, the Board may in its
sole discretion accelerate, waive or amend any or all of the goals,
restrictions or conditions imposed under any Performance Stock Award.

         16.2. RIGHTS AS A STOCKHOLDER.

         A Grantee receiving a Performance Stock Award shall have the rights of
a stockholder only as to shares actually received by the Grantee under the Plan
and not with respect to shares subject to the Award but not actually received
by the Grantee. A Grantee shall be entitled to receive a stock certificate
evidencing the acquisition of Stock under a Performance Stock Award only upon
satisfaction of all conditions specified in the written instrument evidencing
the Performance Stock Award (or in a performance plan adopted by the Board).

         16.3. TERMINATION OF SERVICE.

         Except as may otherwise be provided by the Board either in the Award
Agreement or in writing after the Award Agreement is issued, a Grantee's rights
in all Performance Stock Awards shall automatically terminate upon the
Grantee's termination of Service for any reason.

17.      DIVIDEND EQUIVALENT RIGHTS

         17.1. DIVIDEND EQUIVALENT RIGHTS.

         A Dividend Equivalent Right is an Award entitling the recipient to
receive credits based on cash distributions that would have been paid on the
shares of Stock specified in the Dividend Equivalent Right (or other award to
which it relates) if such shares had been issued to and held by the recipient.
A Dividend Equivalent Right may be granted hereunder to any Grantee as a
component of another Award or as a freestanding award. The terms and conditions
of Dividend Equivalent Rights shall be specified in the grant. Dividend
Equivalents credited to the holder of a Dividend Equivalent Right may be paid
currently or may be deemed to be reinvested in additional shares of Stock,
which may thereafter accrue additional equivalents. Any such reinvestment shall
be at Fair Market Value on the date of reinvestment. Dividend Equivalent Rights
may be settled in cash or Stock or a combination thereof, in a single
installment or installments, all determined in the sole discretion of the
Board. A Dividend Equivalent Right granted as a component of another Award may
provide that such Dividend Equivalent Right shall be settled upon exercise,
settlement, or payment of, or lapse of restrictions on, such other award, and
that such Dividend Equivalent Right shall expire or be forfeited or annulled
under the same conditions as such other award. A Dividend Equivalent Right
granted as a component of another Award may also contain terms and conditions
different from such other award.

                                     -18-
<PAGE>   23

         17.2. INTEREST EQUIVALENTS.

         Any Award under this Plan that is settled in whole or in part in cash
on a deferred basis may provide in the grant for interest equivalents to be
credited with respect to such cash payment. Interest equivalents may be
compounded and shall be paid upon such terms and conditions as may be specified
by the grant.

         17.3. TERMINATION OF SERVICE.

         Except as may otherwise be provided by the Board either in the Award
Agreement or in writing after the Award Agreement is issued, a Grantee's rights
in all Dividend Equivalent Rights or interest equivalents shall automatically
terminate upon the Grantee's termination of Service for any reason.

18.      CERTAIN PROVISIONS APPLICABLE TO AWARDS

         18.1. STAND-ALONE, ADDITIONAL, TANDEM, AND SUBSTITUTE AWARDS.

         Awards granted under the Plan may, in the discretion of the Board, be
granted either alone or in addition to, in tandem with, or in substitution or
exchange for, any other Award or any award granted under another plan of the
Company, any Affiliate, or any business entity to be acquired by the Company or
an Affiliate, or any other right of a Grantee to receive payment from the
Company or any Affiliate. Such additional, tandem, and substitute or exchange
Awards may be granted at any time. If an Award is granted in substitution or
exchange for another Award, the Board shall require the surrender of such other
Award in consideration for the grant of the new Award. In addition, Awards may
be granted in lieu of cash compensation, including in lieu of cash amounts
payable under other plans of the Company or any Affiliate, in which the value
of Stock subject to the Award is equivalent in value to the cash compensation
(for example, Deferred Stock or Restricted Stock), or in which the exercise
price, grant price or purchase price of the Award in the nature of a right that
may be exercised is equal to the Fair Market Value of the underlying Stock
minus the value of the cash compensation surrendered (for example, Options
granted with an exercise price "discounted" by the amount of the cash
compensation surrendered).

         18.2. FORM AND TIMING OF PAYMENT UNDER AWARDS; DEFERRALS.

         Subject to the terms of the Plan and any applicable Award Agreement,
payments to be made by the Company or an Affiliate upon the exercise of an
Option or other Award or settlement of an Award may be made in such forms as
the Board shall determine, including, without limitation, cash, Stock, other
Awards or other property, and may be made in a single payment or transfer, in
installments, or on a deferred basis. The settlement of any Award may be
accelerated, and cash paid in

                                     -19-
<PAGE>   24

lieu of Stock in connection with such settlement, in the discretion of the
Board or upon occurrence of one or more specified events. Installment or
deferred payments may be required by the Board or permitted at the election of
the Grantee on terms and conditions established by the Board. Payments may
include, without limitation, provisions for the payment or crediting of a
reasonable interest rate on installment or deferred payments or the grant or
crediting of Dividend Equivalents or other amounts in respect of installment or
deferred payments denominated in Stock.

18.3.    PERFORMANCE AND ANNUAL INCENTIVE AWARDS.

         18.3.1. PERFORMANCE CONDITIONS.

         The right of a Grantee to exercise or receive a grant or settlement of
any Award, and the timing thereof, may be subject to such performance
conditions as may be specified by the Board. The Board may use such business
criteria and other measures of performance as it may deem appropriate in
establishing any performance conditions, and may exercise its discretion to
reduce the amounts payable under any Award subject to performance conditions,
except as limited under SECTIONS 18.3.2 hereof in the case of a Performance
Award or Annual Incentive Award intended to qualify under Code Section 162(m).
If and to the extent required under Code Section 162(m), any power or authority
relating to a Performance Award or Annual Incentive Award intended to qualify
under Code Section 162(m), shall be exercised by the Committee and not the
Board.

         18.3.2. PERFORMANCE OR ANNUAL INCENTIVE AWARDS GRANTED TO DESIGNATED
                 COVERED EMPLOYEES.

         If and to the extent that the Committee determines that a Performance
or Annual Incentive Award to be granted to a Grantee who is designated by the
Committee as likely to be a Covered Employee should qualify as
"performance-based compensation" for purposes of Code Section 162(m), the
grant, exercise and/or settlement of such Performance or Annual Incentive Award
shall be contingent upon achievement of preestablished performance goals and
other terms set forth in this SECTION 18.3.2.

                                    (i) Performance Goals Generally. The
                  performance goals for such Performance or Annual Incentive
                  Awards shall consist of one or more business criteria and a
                  targeted level or levels of performance with respect to each
                  of such criteria, as specified by the Committee consistent
                  with this SECTION 18.3.2. Performance goals shall be
                  objective and shall otherwise meet the requirements of Code
                  Section 162(m) and regulations thereunder including the
                  requirement that the level or levels of performance targeted
                  by the Committee result in the achievement of performance
                  goals being "substantially

                                     -20-
<PAGE>   25

                  uncertain." The Committee may determine that such Performance
                  or Annual Incentive Awards shall be granted, exercised and/or
                  settled upon achievement of any one performance goal or that
                  two or more of the performance goals must be achieved as a
                  condition to grant, exercise and/or settlement of such
                  Performance or Annual Incentive Awards. Performance goals may
                  differ for Performance or Annual Incentive Awards granted to
                  any one Grantee or to different Grantees.

                                    (ii) Business Criteria. One or more of the
                  following business criteria for the Company, on a
                  consolidated basis, and/or specified subsidiaries or business
                  units of the Company (except with respect to the total
                  stockholder return and earnings per share criteria), shall be
                  used exclusively by the Committee in establishing performance
                  goals for such Performance or Annual Incentive Awards: (1)
                  total stockholder return; (2) such total stockholder return
                  as compared to total return (on a comparable basis) of a
                  publicly available index such as, but not limited to, the
                  Standard & Poor's 500 Stock Index; (3) net income; (4) pretax
                  earnings; (5) earnings before interest expense, taxes,
                  depreciation and amortization; (6) pretax operating earnings
                  after interest expense and before bonuses, service fees, and
                  extraordinary or special items; (7) operating margin; (8)
                  earnings per share; (9) return on equity; (10) return on
                  capital; (11) return on investment; (12) operating earnings;
                  (13) working capital; (14) ratio of debt to stockholders'
                  equity and (15) revenue.

                                    (iii) Performance Period; Timing For
                  Establishing Performance Goals. Achievement of performance
                  goals in respect of Performance Awards shall be measured over
                  a performance period of up to ten years and achievement of
                  performance goals in respect of Annual Incentive Awards shall
                  be measured over a performance period of up to one year, as
                  specified by the Committee. Performance goals shall be
                  established not later than 90 days after the beginning of any
                  performance period applicable to such Performance or Annual
                  Incentive Awards, or at such other date as may be required or
                  permitted for "performance-based compensation" under Code
                  Section 162(m).

                                    (iv) Performance or Annual Incentive Award
                  Pool. The Committee may establish a Performance or Annual
                  Incentive Award pool, which shall be an unfunded pool, for
                  purposes of measuring Company performance in connection with
                  Performance or Annual Incentive Awards.

                                    (v) Settlement of Performance or Annual
                  Incentive Awards; Other Terms. Settlement of such Performance
                  or Annual

                                     -21-
<PAGE>   26

                  Incentive Awards shall be in cash, Stock, other Awards or
                  other property, in the discretion of the Committee. The
                  Committee may, in its discretion, reduce the amount of a
                  settlement otherwise to be made in connection with such
                  Performance or Annual Incentive Awards. The Committee shall
                  specify the circumstances in which such Performance or Annual
                  Incentive Awards shall be paid or forfeited in the event of
                  termination of Service by the Grantee prior to the end of a
                  performance period or settlement of Performance Awards.

         18.3.3. WRITTEN DETERMINATIONS.

         All determinations by the Committee as to the establishment of
performance goals, the amount of any Performance Award pool or potential
individual Performance Awards and as to the achievement of performance goals
relating to Performance Awards, and the amount of any Annual Incentive Award
pool or potential individual Annual Incentive Awards and the amount of final
Annual Incentive Awards, shall be made in writing in the case of any Award
intended to qualify under Code Section 162(m). To the extent required to comply
with Code Section 162(m), the Committee may delegate any responsibility
relating to such Performance Awards or Annual Incentive Awards.

         18.3.4. STATUS OF SECTION 18.3.2 AWARDS UNDER CODE SECTION 162(m).

         It is the intent of the Company that Performance Awards and Annual
Incentive Awards under SECTION 18.3.2 hereof granted to persons who are
designated by the Committee as likely to be Covered Employees within the
meaning of Code Section 162(m) and regulations thereunder shall, if so
designated by the Committee, constitute "qualified performance-based
compensation" within the meaning of Code Section 162(m) and regulations
thereunder. Accordingly, the terms of SECTION 18.3.2, including the definitions
of Covered Employee and other terms used therein, shall be interpreted in a
manner consistent with Code Section 162(m) and regulations thereunder. The
foregoing notwithstanding, because the Committee cannot determine with
certainty whether a given Grantee will be a Covered Employee with respect to a
fiscal year that has not yet been completed, the term Covered Employee as used
herein shall mean only a person designated by the Committee, at the time of
grant of Performance Awards or an Annual Incentive Award, as likely to be a
Covered Employee with respect to that fiscal year. If any provision of the Plan
or any agreement relating to such Performance Awards or Annual Incentive Awards
does not comply or is inconsistent with the requirements of Code Section 162(m)
or regulations thereunder, such provision shall be construed or deemed amended
to the extent necessary to conform to such requirements.

                                     -22-
<PAGE>   27

19.      PARACHUTE LIMITATIONS

         Notwithstanding any other provision of this Plan or of any other
agreement, contract, or understanding heretofore or hereafter entered into by a
Grantee with the Company or any Affiliate, except an agreement, contract, or
understanding hereafter entered into that expressly modifies or excludes
application of this paragraph (an "Other Agreement"), and notwithstanding any
formal or informal plan or other arrangement for the direct or indirect
provision of compensation to the Grantee (including groups or classes of
Grantees or beneficiaries of which the Grantee is a member), whether or not
such compensation is deferred, is in cash, or is in the form of a benefit to or
for the Grantee (a "Benefit Arrangement"), if the Grantee is a "disqualified
individual," as defined in Section 280G(c) of the Code, any Option, Restricted
Stock or Restricted Stock Unit held by that Grantee and any right to receive
any payment or other benefit under this Plan shall not become exercisable or
vested (i) to the extent that such right to exercise, vesting, payment, or
benefit, taking into account all other rights, payments, or benefits to or for
the Grantee under this Plan, all Other Agreements, and all Benefit
Arrangements, would cause any payment or benefit to the Grantee under this Plan
to be considered a "parachute payment" within the meaning of Section 280G(b)(2)
of the Code as then in effect (a "Parachute Payment") and (ii) if, as a result
of receiving a Parachute Payment, the aggregate after-tax amounts received by
the Grantee from the Company under this Plan, all Other Agreements, and all
Benefit Arrangements would be less than the maximum after-tax amount that could
be received by the Grantee without causing any such payment or benefit to be
considered a Parachute Payment. In the event that the receipt of any such right
to exercise, vesting, payment, or benefit under this Plan, in conjunction with
all other rights, payments, or benefits to or for the Grantee under any Other
Agreement or any Benefit Arrangement would cause the Grantee to be considered
to have received a Parachute Payment under this Plan that would have the effect
of decreasing the after-tax amount received by the Grantee as described in
clause (ii) of the preceding sentence, then the Grantee shall have the right,
in the Grantee's sole discretion, to designate those rights, payments, or
benefits under this Plan, any Other Agreements, and any Benefit Arrangements
that should be reduced or eliminated so as to avoid having the payment or
benefit to the Grantee under this Plan be deemed to be a Parachute Payment.

20.      REQUIREMENTS OF LAW

         20.1. GENERAL.

         The Company shall not be required to sell or issue any shares of Stock
under any Award if the sale or issuance of such shares would constitute a
violation by the Grantee, any other individual exercising an Option, or the
Company of any provision of any law or regulation of any governmental
authority, including without limitation any federal or state securities laws or
regulations. If at any time the Company shall determine, in its discretion,
that the listing, registration or qualification of any shares

                                     -23-
<PAGE>   28
subject to an Award upon any securities exchange or under any governmental
regulatory body is necessary or desirable as a condition of, or in connection
with, the issuance or purchase of shares hereunder, no shares of Stock may be
issued or sold to the Grantee or any other individual exercising an Option
pursuant to such Award unless such listing, registration, qualification,
consent or approval shall have been effected or obtained free of any conditions
not acceptable to the Company, and any delay caused thereby shall in no way
affect the date of termination of the Award. Specifically, in connection with
the Securities Act, upon the exercise of any Option or the delivery of any
shares of Stock underlying an Award, unless a registration statement under such
Act is in effect with respect to the shares of Stock covered by such Award, the
Company shall not be required to sell or issue such shares unless the Board has
received evidence satisfactory to it that the Grantee or any other individual
exercising an Option may acquire such shares pursuant to an exemption from
registration under the Securities Act. Any determination in this connection by
the Board shall be final, binding, and conclusive. The Company may, but shall
in no event be obligated to, register any securities covered hereby pursuant to
the Securities Act. The Company shall not be obligated to take any affirmative
action in order to cause the exercise of an Option or the issuance of shares of
Stock pursuant to the Plan to comply with any law or regulation of any
governmental authority. As to any jurisdiction that expressly imposes the
requirement that an Option shall not be exercisable until the shares of Stock
covered by such Option are registered or are exempt from registration, the
exercise of such Option (under circumstances in which the laws of such
jurisdiction apply) shall be deemed conditioned upon the effectiveness of such
registration or the availability of such an exemption.

         20.2. RULE 16b-3.

         During any time when the Company has a class of equity security
registered under Section 12 of the Exchange Act, it is the intent of the
Company that Awards pursuant to the Plan and the exercise of Options granted
hereunder will qualify for the exemption provided by Rule 16b-3 under the
Exchange Act. To the extent that any provision of the Plan or action by the
Board does not comply with the requirements of Rule 16b-3, it shall be deemed
inoperative to the extent permitted by law and deemed advisable by the Board,
and shall not affect the validity of the Plan. In the event that Rule 16b-3 is
revised or replaced, the Board may exercise its discretion to modify this Plan
in any respect necessary to satisfy the requirements of, or to take advantage
of any features of, the revised exemption or its replacement.

         20.3. LIMITATION FOLLOWING A HARDSHIP DISTRIBUTION.

         To the extent required to comply with Treasury Regulation
Section 1.401(k)-1(d)(2)(iv)(B)(4), or any amendment or successor thereto, a
Grantee's "elective and employee contributions" (within the meaning of such
Treasury Regulation) under the Plan shall be suspended for a period of twelve
months following such Grantee's receipt of a hardship distribution made in
reliance on such Treasury Regulation from any plan containing a cash or
deferred arrangement under Section 401(k) of

                                     -24-
<PAGE>   29

the Code maintained by the Company or a related party within the provisions of
subsections (b), (c), (m) or (o) of Section 414 of the Code.

21.      AMENDMENT AND TERMINATION OF THE PLAN

         The Board may, at any time and from time to time, amend, suspend, or
terminate the Plan as to any shares of Stock as to which Awards have not been
made; provided, however, that the Board shall not, without approval of the
Company's shareholders, amend the Plan such that it does not comply with the
Code. Except as permitted under this SECTION 21 or SECTION 22 hereof, no
amendment, suspension, or termination of the Plan shall, without the consent of
the Grantee, alter or impair rights or obligations under any Award theretofore
awarded under the Plan.

22.      EFFECT OF CHANGES IN CAPITALIZATION

         22.1. CHANGES IN STOCK.

        If the number of outstanding shares of Stock is increased or decreased
or the shares of Stock are changed into or exchanged for a different number or
kind of shares or other securities of the Company on account of any
recapitalization, reclassification, stock split, reverse split, 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, the
number and kinds of shares for which grants of Options and other Awards may be
made under the Plan shall be adjusted proportionately and accordingly by the
Company. In addition, the number and kind of shares for which Awards are
outstanding shall be adjusted proportionately and accordingly so that the
proportionate interest of the Grantee immediately following such event shall,
to the extent practicable, be the same as immediately before such event. Any
such adjustment in outstanding Options shall not change the aggregate Option
Price payable with respect to shares that are subject to the unexercised
portion of an Option outstanding but shall include a corresponding
proportionate adjustment in the Option Price per share. The conversion of any
convertible securities of the Company shall not be treated as an increase in
shares effected without receipt of consideration. Notwithstanding the
foregoing, in the event of a spin-off that results in no change in the number
of outstanding shares of Stock of the Company, the Company may, in such manner
as the Company deems appropriate, adjust (i) the number and kind of shares
subject to outstanding Awards and/or (ii) the exercise price of outstanding
Options and Stock Appreciation Rights.

                                     -25-
<PAGE>   30

         22.2. REORGANIZATION IN WHICH THE COMPANY IS THE SURVIVING ENTITY AND
               IN WHICH NO CHANGE IN CONTROL OCCURS.

         Subject to SECTION 22.3 hereof, if the Company shall be the surviving
entity in any reorganization, merger, or consolidation of the Company with one
or more other entities in which no Change in Control occurs, 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 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 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.
Subject to any contrary language in an Award Agreement evidencing an Award, any
restrictions applicable to such Award shall apply as well to any replacement
shares received by the Grantee as a result of the reorganization, merger or
consolidation.

         22.3. REORGANIZATION, SALE OF ASSETS OR SALE OF STOCK WHICH INVOLVES A
               CHANGE IN CONTROL.

         (a) Subject to SECTION 22.3(b), upon any transaction that results in a
Change in Control, (i) all outstanding shares subject to Awards shall be deemed
to have vested, and all restrictions and conditions applicable to such shares
subject to Awards shall be deemed to have lapsed, immediately prior to the
occurrence of such event, and (ii) all Options outstanding hereunder shall
become immediately exercisable for a period of fifteen days immediately prior
to the scheduled consummation of the event. Any exercise of an Option during
such fifteen-day period shall be conditioned upon the consummation of the event
and shall be effective only immediately before the consummation of the event.
Upon consummation of any such event, the Plan and all outstanding but
unexercised Options shall terminate. The Board shall send written notice of an
event that will result in such a termination to all individuals who hold
Options not later than the time at which the Company gives notice thereof to
its shareholders.

         (b) SECTION 22.3(a) shall not apply to the extent provision is made in
writing in connection with a transaction described in SECTION 22.3(a) for the
assumption of such Options theretofore granted, or for the substitution for
such Options of new options covering the stock of a successor entity, or a
parent or subsidiary thereof, with appropriate adjustments as to the number and
kinds of shares or units and exercise prices, in which event the Plan and
Options theretofore granted shall continue in the manner and under the terms so
provided.

         22.4. ADJUSTMENTS.

         Adjustments under this SECTION 22 related to shares of Stock or
securities of the Company shall be made by the Board, whose determination in
that respect shall be final, binding and conclusive. No fractional shares or
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

                                     -26-
<PAGE>   31

whole share. The Board may provide in the Award Agreements at the time of
grant, or any time thereafter with the consent of the Grantee, for different
provisions to apply to an Award in place of those described in SECTIONS 22.1,
22.2 and 22.3. 22.5. NO LIMITATIONS ON COMPANY.

         The making of Awards 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.

23.      POOLING

         In the event any provision of the Plan or the Award Agreement 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 an Award Agreement that a Grantee who receives an Award 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.

24.      DISCLAIMER OF RIGHTS

         No provision in the Plan or in any Award or Award Agreement shall be
construed to confer upon any individual the right to remain in the employ or
service of the Company or any Affiliate, or to interfere in any way with any
contractual or other right or authority of the Company either to increase or
decrease the compensation or other payments to any individual at any time, or
to terminate any employment or other relationship between any individual and
the Company. In addition, notwithstanding anything contained in the Plan to the
contrary, unless otherwise stated in the applicable Award Agreement, no Award
granted under the Plan shall be affected by any change of duties or position of
the Grantee, so long as such Grantee continues to be a director, officer,
consultant or employee of the Company or an Affiliate. The obligation of the
Company to pay any benefits pursuant to this Plan shall be interpreted as a
contractual obligation to pay only those amounts described herein, in the
manner and under the conditions prescribed herein. The Plan shall in no way be
interpreted to require the Company to transfer any amounts to a third party
trustee or otherwise hold any amounts in trust or escrow for payment to any
Grantee or beneficiary under the terms of the Plan. No Grantee shall have any
of the rights of a shareholder with respect to the shares of Stock subject to
an Option except to the extent the certificates for such shares of Stock shall
have been issued upon the exercise of the Option.

                                     -27-
<PAGE>   32

25.      NONEXCLUSIVITY OF THE PLAN

         Neither the adoption of the Plan nor the submission of the Plan to the
shareholders of the Company for approval shall be construed as creating any
limitations upon the right and authority of the Board to adopt such other
incentive compensation arrangements (which arrangements may be applicable
either generally to a class or classes of individuals or specifically to a
particular individual or particular individuals) as the Board in its discretion
determines desirable, including, without limitation, the granting of stock
options otherwise than under the Plan.

26.      WITHHOLDING TAXES

         The Company or an Affiliate, as the case may be, shall have the right
to deduct from payments of any kind otherwise due to a Grantee any Federal,
state, or local taxes of any kind required by law to be withheld with respect
to the vesting of or other lapse of restrictions applicable to an Award or upon
the issuance of any shares of Stock upon the exercise of an Option or pursuant
to an Award. At the time of such vesting, lapse, or exercise, the Grantee shall
pay to the Company or the Affiliate, as the case may be, any amount that the
Company or the Affiliate may reasonably determine to be necessary to satisfy
such withholding obligation. Subject to the prior approval of the Company or
the Affiliate, which may be withheld by the Company or the Affiliate, as the
case may be, in its sole discretion, the Grantee may elect to satisfy such
obligations, in whole or in part, (i) by causing the Company or the Affiliate
to withhold shares of Stock otherwise issuable to the Grantee or (ii) by
delivering to the Company or the Affiliate shares of Stock already owned by the
Grantee. The shares of Stock so delivered or withheld shall have an aggregate
Fair Market Value equal to such withholding obligations. The Fair Market Value
of the shares of Stock used to satisfy such withholding obligation shall be
determined by the Company or the Affiliate as of the date that the amount of
tax to be withheld is to be determined. A Grantee who has made an election
pursuant to this SECTION 26 may satisfy his or her withholding obligation only
with shares of Stock that are not subject to any repurchase, forfeiture,
unfulfilled vesting, or other similar requirements.

                                     -28-
<PAGE>   33

27.      CAPTIONS

         The use of captions in this Plan or any Award Agreement is for the
convenience of reference only and shall not affect the meaning of any provision
of the Plan or such Award Agreement.

28.      OTHER PROVISIONS

         Each Award granted under the Plan may contain such other terms and
conditions not inconsistent with the Plan as may be determined by the Board, in
its sole discretion.

29.      NUMBER AND GENDER

         With respect to words used in this Plan, the singular form shall
include the plural form, the masculine gender shall include the feminine
gender, etc., as the context requires.

30.      SEVERABILITY

         If any provision of the Plan or any Award Agreement shall be
determined to be illegal or unenforceable by any court of law in any
jurisdiction, the remaining provisions hereof and thereof shall be severable
and enforceable in accordance with their terms, and all provisions shall remain
enforceable in any other jurisdiction.

31.      GOVERNING LAW

         The validity and construction of this Plan and the instruments
evidencing the Grants awarded hereunder shall be governed by the laws of the
State of Colorado, other than any conflicts or choice of law rule or principle
that might otherwise refer construction or interpretation of this Plan and the
instruments evidencing the Awards awarded hereunder to the substantive laws of
any other jurisdiction.

                                     * * *

                                     -29-
<PAGE>   34

         To record adoption the amendment and restatement of the Plan by the
Board as of September 8, 2000, and approval of the Plan by the stockholders on
September 8, 2000, in each case so that the Plan is effective upon the closing
of the initial public offering of the Company's common stock, the Company has
caused its authorized officer to execute the Plan as amended and restated.

                                                Array BioPharma Inc.

                                                By:
                                                     --------------------------
                                                      Michael Carruthers,
                                                      Secretary

                                     -30-

Source: [{"source": "alea-institute/alea-institute/kl3m-data-edgar-agreements/train-00016-of-00352.parquet"}, [{"source": "alea-institute/alea-institute/kl3m-data-edgar-agreements/train-00016-of-00352.parquet"}]]