Document:

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                                                                    EXHIBIT 4.08

                            NETWORK SOLUTIONS, INC.

                           1996 STOCK INCENTIVE PLAN

               (Amended and Restated Effective October 27, 1999)
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                               TABLE OF CONTENTS
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ARTICLE 1.  INTRODUCTION................................    1

ARTICLE 2.  ADMINISTRATION..............................    1
     2.1  Committee Composition.........................    1
     2.2  Committee Responsibilities....................    1

ARTICLE 3.  SHARES AVAILABLE FOR GRANTS.................    2
     3.1  Basic Limitation..............................    2
     3.2  Additional Shares.............................    2
     3.3  Dividend Equivalents..........................    2

ARTICLE 4.  ELIGIBILITY.................................    2
     4.1  General Rules.................................    2
     4.2  Incentive Stock Options.......................    2
     4.3  Limits on Awards..............................    2

ARTICLE 5.  OPTIONS.....................................    3
     5.1  Stock Option Agreement........................    3
     5.2  Number of Shares..............................    3
     5.3  Exercise Price................................    3
     5.4  Exercisability and Term.......................    3
     5.5  Effect of Change in Control...................    3
     5.6  Modification or Assumption of Options.........    3

ARTICLE 6.  PAYMENT FOR OPTION SHARES...................    4
     6.1  General Rule..................................    4
     6.2  Surrender of Stock............................    4
     6.3  Exercise/Sale.................................    4
     6.4  Exercise/Pledge...............................    4
     6.5  Promissory Note...............................    4
     6.6  Other Forms of Payment........................    4

ARTICLE 7.  STOCK APPRECIATION RIGHTS...................    5
     7.1  SAR Agreement.................................    5
     7.2  Number of Shares..............................    5
     7.3  Exercise Price................................    5
     7.4  Exercisability and Term.......................    5
     7.5  Effect of Change in Control...................    5
     7.6  Exercise of SARs..............................    5
     7.7  Modification or Assumption of SARs............    6
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ARTICLE 8.  RESTRICTED SHARES AND STOCK UNITS...........    6
     8.1  Time, Amount and Form of Awards...............    6
     8.2  Payment for Awards............................    6
     8.3  Vesting Conditions............................    6
     8.4  Form and Time of Settlement of Stock Units....    6
     8.5  Death of Recipient............................    6
     8.6  Creditors' Rights.............................    7

ARTICLE 9.  VOTING AND DIVIDEND RIGHTS..................    7
     9.1  Restricted Shares.............................    7
     9.2  Stock Units...................................    7

ARTICLE 10.  PROTECTION AGAINST DILUTION................    7
     10.1  Adjustments..................................    7
     10.2  Reorganizations..............................    8

ARTICLE 11.  AWARDS UNDER OTHER PLANS...................    8

ARTICLE 12.  PAYMENT OF DIRECTOR'S FEES IN SECURITIES...    8
     12.1  Effective Date...............................    8
     12.2  Elections to Receive NSOs or Stock Units.....    8
     12.3  Number and Terms of NSOs.....................    8
     12.4  Number and Terms of Stock Units..............    8

ARTICLE 13.  LIMITATION ON RIGHTS.......................    8
     13.1  Retention Rights.............................    8
     13.2  Stockholders' Rights.........................    9
     13.3  Regulatory Requirements......................    9

ARTICLE 14.  LIMITATION ON PAYMENTS.....................    9
     14.1  Basic Rule...................................    9
     14.2  Reduction of Payments........................    9
     14.3  Overpayments and Underpayments...............   10
     14.4  Related Corporations.........................   10

ARTICLE 15.  WITHHOLDING TAXES..........................   10
     15.1  General......................................   10
     15.2  Share Withholding............................   10

ARTICLE 16.  ASSIGNMENT OR TRANSFER OF AWARDS...........   10
     16.1  General......................................   10

ARTICLE 17.  FUTURE OF THE PLAN.........................   11
     17.1  Term of the Plan.............................   11
     17.2  Amendment or Termination.....................   11

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ARTICLE 18.  DEFINITIONS................................   11

ARTICLE 19.  EXECUTION..................................   13

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                            NETWORK SOLUTIONS, INC.

                           1996 STOCK INCENTIVE PLAN

                 (Amended and Restated Effective July 7, 1997)

     ARTICLE 1.  INTRODUCTION.

     The Plan was adopted by the Board on September 18, 1996, subject to
approval by the Company's stockholders.  The Plan was most recently amended and
restated on July 7, 1997 to reflect the recapitalization of the common shares of
the Company.

     The purpose of the Plan is to promote the long-term success of the Company
and the creation of stockholder value by (a) encouraging Key Employees to focus
on critical long-range objectives, (b) encouraging the attraction and retention
of Key Employees with exceptional qualifications and (c) linking Key Employees
directly to stockholder interests through increased stock ownership.  The Plan
seeks to achieve this purpose by providing for Awards in the form of Restricted
Shares, Stock Units, Options (which may constitute incentive stock options or
nonstatutory stock options) or stock appreciation rights.

     The Plan shall be governed by, and construed in accordance with, the laws
of the State of Delaware (except their choice-of-law provisions).

     ARTICLE 2.  ADMINISTRATION.

     2.1  Committee Composition.  The Plan shall be administered by the
Committee.  Effective with the Company's initial public offering, the Committee
shall consist of two or more directors of the Company who shall satisfy the
requirements of Rule 16b-3 (or its successor) under the Exchange Act with
respect to the grant of Awards to persons who are officers or directors of the
Company under Section 16 of the Exchange Act or the Board itself.

     The Board may also appoint one or more separate committees of the Board,
each composed of one or more directors of the Company who need not qualify under
Rule 16b-3, who may administer the Plan with respect to Key Employees who are
not considered officers or directors of the Company under Section 16 of the
Exchange Act, may grant Awards under the Plan to such Key Employees and may
determine all terms of such Awards.

     2.2  Committee Responsibilities.  The Committee shall:

     (a)  Select the Key Employees who are to receive Awards under the Plan;

     (b)  Determine the type, number, vesting requirements and other features
and conditions of such Awards;

     (c)  Interpret the Plan; and

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     (d)  Make all other decisions relating to the operation of the Plan.

     The Committee may adopt such rules or guidelines as it deems appropriate to
implement the Plan.  The Committee's determinations under the Plan shall be
final and binding on all persons.

     ARTICLE 3.  SHARES AVAILABLE FOR GRANTS.

     3.1  Basic Limitation.  Common Shares issued pursuant to the Plan may be
authorized but unissued shares or treasury shares.  The aggregate number of
Common Shares initially reserved for award under the Plan shall be 2,306,250
shares.  Effective January 1, 1997 and on each January 1 thereafter for the
remaining term of the Plan, the aggregate number of Common Shares which may be
issued under the Plan to individuals shall be increased by a number of Common
Shares equal to 2% of the total number of the Class A and Class B shares of
common stock of the Company outstanding at the end of the most recently
concluded calendar year.  Any Common Shares that have been reserved but not
issued as Restricted Shares, Share Units, Options or SARs during any calendar
year shall remain available for grant during any subsequent calendar year.
Notwithstanding the foregoing, no more than 1,000,000 Common Shares shall be
available for the grant of ISOs for the remaining term of the Plan.  The
limitation of this Section 3.1 shall be subject to adjustment pursuant to
Article 10.

     3.2  Additional Shares.  If Stock Units, Options or SARs are forfeited or
if Options or SARs terminate for any other reason before being exercised, then
the corresponding Common Shares shall again become available for Awards under
the Plan.  If SARs are exercised, then only the number of Common Shares (if any)
actually issued in settlement of such SARs shall reduce the number available
under Section 3.1 and the balance shall again become available for Awards under
the Plan.  If Restricted Shares are forfeited, then such Shares shall again
become available for Awards under the Plan.

     3.3  Dividend Equivalents.  Any dividend equivalents distributed under the
Plan shall not be applied against the number of Restricted Shares, Stock Units,
Options or SARs available for Awards, whether or not such dividend equivalents
are converted into Stock Units.

      Section 3.4.  Additional Shares. .  In addition to Common Shares reserved
under Section 3.1 of the Plan, 2,000,000 Common Shares [subsequently increased
to 4,000,000 based on a 2 for 1 stock split effected in the form of a dividend
on the Registrant's Common Stock, which was distributed on March 10, 2000] shall
be reserved for Awards granted under the Plan to Key Employees who are not
officers or directors within the meaning of the National Association of
Securities Dealers (NASD) Marketplace Rule 4310(c)(25)(H), during the period
commencing October 27, 1999, and ending on the date of the first annual meeting
of the Company's shareholders which occurs after such date, provided, however,
that no Award with respect to such shares shall be deemed to be an ISO.  The
provision of this Section 3.4 shall be subject to adjustment pursuant to Section
10.  Awards with respect to Common Shares received and authorized pursuant to
this Section 3.4 shall not be taken into account for purposes of the limitations
of Section 3.1.

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     ARTICLE 4.  ELIGIBILITY.

     4.1  General Rules.  Only Key Employees (including, without limitation,
independent contractors who are not members of the Board) shall be eligible for
designation as Participants by the Committee.  All Outside Directors shall be
eligible for making an election described in Article 12.

     4.2  Incentive Stock Options.  Only Key Employees who are common-law
employees of the Company, a Parent or a Subsidiary shall be eligible for the
grant of ISOs.  In addition, a Key Employee who owns more than ten percent (10%)
of the total combined voting power of all classes of outstanding stock of the
Company or any of its Parents or Subsidiaries shall not be eligible for the
grant of an ISO unless the requirements set forth in section 422(c)(5) of the
Code are satisfied.

     4.3  Limits on Awards.  No Key Employee shall receive Options or SARs to
purchase Common Shares during any fiscal year covering in excess of 1,000,000
Common Shares; provided, however, a newly hired Key Employee may receive Options
or SARs to purchase up to 1,000,000 Common Shares during the portion of the
fiscal year remaining after his or her date of hire.

     ARTICLE 5.  OPTIONS.

     5.1  Stock Option Agreement.  Each grant of an Option under the Plan shall
be evidenced by a Stock Option Agreement between the Optionee and the Company.
Such Option shall be subject to all applicable terms of the Plan and may be
subject to any other terms that are not inconsistent with the Plan, including
but not limited to rights of repurchase and rights of first refusal.  The Stock
Option Agreement shall specify whether the Option is an ISO or an NSO.  The
provisions of the various Stock Option Agreements entered into under the Plan
need not be identical.  Options may be granted in consideration of a cash
payment or in consideration of a reduction in the Optionee's other compensation.
A Stock Option Agreement may provide that new Options will be granted
automatically to the Optionee when he or she exercises the prior Options.

     5.2  Number of Shares.  Each Stock Option Agreement shall specify the
number of Common Shares subject to the Option and shall provide for the
adjustment of such number in accordance with Article 10.

     5.3  Exercise Price.  Each Stock Option Agreement shall specify the
Exercise Price; provided that the Exercise Price of an ISO shall in no event be
less than one hundred percent (100%) of the Fair Market Value of a Common Share
on the date of grant.  In the case of an NSO, a Stock Option Agreement may
specify an Exercise Price that varies in accordance with a predetermined formula
while the NSO is outstanding.

     5.4  Exercisability and Term.  Each Stock Option Agreement shall specify
the date when all or any installment of the Option is to become exercisable.
The Stock Option

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Agreement shall also specify the term of the Option; provided that the term of
an ISO shall in no event exceed ten (10) years from the date of grant. A Stock
Option Agreement may provide for accelerated exercisability in the event of the
Optionee's death, disability or retirement or other events and may provide for
expiration prior to the end of its term in the event of the termination of the
Optionee's service. Options may be awarded in combination with SARs, and such an
Award may provide that the Options will not be exercisable unless the related
SARs are forfeited. NSOs may also be awarded in combination with Restricted
Shares or Stock Units, and such an Award may provide that the NSOs will not be
exercisable unless the related Restricted Shares or Stock Units are forfeited.

     5.5  Effect of Change in Control.  The Committee may determine, at the time
of granting an Option or thereafter, that such Option shall become fully
exercisable as to all Common Shares subject to such Option in the event that a
Change in Control occurs with respect to the Company.

     5.6  Modification or Assumption of Options.  Within the limitations of the
Plan, the Committee may modify, extend or assume outstanding options or may
accept the cancellation of outstanding options (whether granted by the Company
or by another issuer) in return for the grant of new options for the same or a
different number of shares and at the same or a different exercise price.  The
foregoing notwithstanding, no modification of an Option shall, without the
consent of the Optionee, alter or impair his or her rights or obligations under
such Option.

     ARTICLE 6.  PAYMENT FOR OPTION SHARES

     6.1  General Rule.  The entire Exercise Price for the Common Shares issued
upon exercise of Options shall be payable in cash at the time when such Common
Shares are purchased, except as follows:

          (a)  In the case of an ISO granted under the Plan, payment shall be
     made only pursuant to the express provisions of the applicable Stock Option
     Agreement.  The Stock Option Agreement may specify that payment may be
     made in any form(s) described in this Article 6.

          (b)  In the case of an NSO, the Committee may at any time accept
     payment in any form(s) described in this Article 6.

     6.2  Surrender of Stock.  To the extent that this Section 6.2 is
applicable, payment for all or any part of the Exercise Price may be made with
Common Shares which have already been owned by the Optionee for such duration as
shall be specified by the Committee.  Such Common Shares shall be valued at
their Fair Market Value on the date when the new Common Shares are purchased
under the Plan.

     6.3  Exercise/Sale.  To the extent that this Section 6.3 is applicable,
payment may be made by the delivery (on a form prescribed by the Company) of an
irrevocable direction to a securities broker approved by the Company to sell
Common Shares and to deliver all or part of

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the sales proceeds to the Company in payment of all or part of the Exercise
Price and any withholding taxes.

     6.4  Exercise/Pledge.  To the extent that this Section 6.4 is applicable,
payment may be made by the delivery (on a form prescribed by the Company) of an
irrevocable direction to pledge Common Shares to a securities broker or lender
approved by the Company, as security for a loan, and to deliver all or part of
the loan proceeds to the Company in payment of all or part of the Exercise Price
and any withholding taxes.

     6.5  Promissory Note.  To the extent that this Section 6.5 is applicable,
payment may be made with a full-recourse promissory note; provided that to the
extent required by applicable law, the par value of the Common Shares shall be
paid in cash.

     6.6  Other Forms of Payment.  To the extent that this Section 6.6 is
applicable, payment may be made in any other form that is consistent with
applicable laws, regulations and rules.

     ARTICLE 7.  STOCK APPRECIATION RIGHTS.

     7.1  SAR Agreement.  Each grant of a SAR under the Plan shall be evidenced
by a SAR Agreement between the Optionee and the Company.  Such SAR shall be
subject to all applicable terms of the Plan and may be subject to any other
terms that are not inconsistent with the Plan.  The provisions of the various
SAR Agreements entered into under the Plan need not be identical.  SARs may be
granted in consideration of a reduction in the Optionee's other compensation.

     7.2  Number of Shares.  Each SAR Agreement shall specify the number of
Common Shares to which the SAR pertains and shall provide for the adjustment of
such number in accordance with Article 10.

     7.3  Exercise Price.  Each SAR Agreement shall specify the Exercise Price.
A SAR Agreement may specify an Exercise Price that varies in accordance with a
predetermined formula while the SAR is outstanding.

     7.4  Exercisability and Term.  Each SAR Agreement shall specify the date
when all or any installment of the SAR is to become exercisable.  The SAR
Agreement shall also specify the term of the SAR.  A SAR Agreement may provide
for accelerated exercisability in the event of the Optionee's death, disability
or retirement or other events and may provide for expiration prior to the end of
its term in the event of the termination of the Optionee's service.  SARs may
also be awarded in combination with Options, Restricted Shares or Stock Units,
and such an Award may provide that the SARs will not be exercisable unless the
related Options, Restricted Shares or Stock Units are forfeited.  A SAR may be
included in an ISO only at the time of grant but may be included in an NSO at
the time of grant or thereafter.  A SAR granted under the Plan may provide that
it will be exercisable only in the event of a Change in Control.

     7.5  Effect of Change in Control.  The Committee may determine, at the time
of granting a SAR or thereafter, that such SAR shall become fully exercisable as
to all Common

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Shares subject to such SAR in the event that a Change in Control occurs with
respect to the Company.

     7.6  Exercise of SARs.  If, on the date when a SAR expires, the Exercise
Price under such SAR is less than the Fair Market Value on such date but any
portion of such SAR has not been exercised or surrendered, then such SAR shall
automatically be deemed to be exercised as of such date with respect to such
portion.  Upon exercise of a SAR, the Optionee (or any person having the right
to exercise the SAR after his or her death) shall receive from the Company (a)
Common Shares, (b) cash or (c) a combination of Common Shares and cash, as the
Committee shall determine.  The amount of cash and/or the Fair Market Value of
Common Shares received upon exercise of SARs shall, in the aggregate, be equal
to the amount by which the Fair Market Value (on the date of surrender) of the
Common Shares subject to the SARs exceeds the Exercise Price.

     7.7  Modification or Assumption of SARs.  Within the limitations of the
Plan, the Committee may modify, extend or assume outstanding SARs or may accept
the cancellation of outstanding SARs (whether granted by the Company or by
another issuer) in return for the grant of new SARs for the same or a different
number of shares and at the same or a different exercise price.  The foregoing
notwithstanding, no modification of a SAR shall, without the consent of the
Optionee, alter or impair his or her rights or obligations under such SAR.

     ARTICLE 8.  RESTRICTED SHARES AND STOCK UNITS.

     8.1  Time, Amount and Form of Awards.  Awards under the Plan may be granted
in the form of Restricted Shares, in the form of Stock Units, or in any
combination of both.  Restricted Shares or Stock Units may also be awarded in
combination with NSOs or SARs, and such an Award may provide that the Restricted
Shares or Stock Units will be forfeited in the event that the related NSOs or
SARs are exercised.

     8.2  Payment for Awards.  To the extent that an Award is granted in the
form of newly issued Restricted Shares, the Award recipient, as a condition to
the grant of such Award, shall be required to pay the Company in cash an amount
equal to the par value of such Restricted Shares.  To the extent that an Award
is granted in the form of Restricted Shares from the Company's treasury or in
the form of Stock Units, no cash consideration shall be required of the Award
recipients.

     8.3  Vesting Conditions.  Each Award of Restricted Shares or Stock Units
shall become vested, in full or in installments, upon satisfaction of the
conditions specified in the Stock Award Agreement which may include performance
conditions.  A Stock Award Agreement may provide for accelerated vesting in the
event of the Participant's death, disability or retirement or other events.  The
Committee may determine, at the time of making an Award or thereafter, that such
Award shall become fully vested in the event that a Change in Control occurs
with respect to the Company.

     8.4  Form and Time of Settlement of Stock Units.  Settlement of vested
Stock Units may be made in the form of (a) cash, (b) Common Shares or (c) any
combination of both.  The

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actual number of Stock Units eligible for settlement may be larger or smaller
than the number included in the original Award, based on predetermined
performance factors. Methods of converting Stock Units into cash may include
(without limitation) a method based on the average Fair Market Value of Common
Shares over a series of trading days. Vested Stock Units may be settled in a
lump sum or in installments. The distribution may occur or commence when all
vesting conditions applicable to the Stock Units have been satisfied or have
lapsed, or it may be deferred to any later date. The amount of a deferred
distribution may be increased by an interest factor or by dividend equivalents.
Until an Award of Stock Units is settled, the number of such Stock Units shall
be subject to adjustment pursuant to Article 10.

     8.5  Death of Recipient.  Any Stock Units Award that becomes payable after
the recipient's death shall be distributed to the recipient's beneficiary or
beneficiaries.  Each recipient of a Stock Units Award under the Plan shall
designate one or more beneficiaries for this purpose by filing the prescribed
form with the Company.  A beneficiary designation may be changed by filing the
prescribed form with the Company at any time before the Award recipient's death.
If no beneficiary was designated or if no designated beneficiary survives the
Award recipient, then any Stock Units Award that becomes payable after the
recipient's death shall be distributed to the recipient's estate.

     8.6  Creditors' Rights.  A holder of Stock Units shall have no rights other
than those of a general creditor of the Company.  Stock Units represent an
unfunded and unsecured obligation of the Company, subject to the terms and
conditions of the applicable Stock Award Agreement.

     ARTICLE 9.  VOTING AND DIVIDEND RIGHTS.

     9.1  Restricted Shares. The holders of Restricted Shares awarded under the
Plan shall have the same voting, dividend and other rights as the Company's
other stockholders.  A Stock Award Agreement, however, may require that the
holders of Restricted Shares invest any cash dividends received in additional
Restricted Shares.  Such additional Restricted Shares shall be subject to the
same conditions and restrictions as the Award with respect to which the
dividends were paid.  Such additional Restricted Shares shall not reduce the
number of Common Shares available under Article 3.

     9.2  Stock Units.  The holders of Stock Units shall have no voting rights.
Prior to settlement or forfeiture, any Stock Unit awarded under the Plan may, at
the Committee's discretion, carry with it a right to dividend equivalents.  Such
right entitles the holder to be credited with an amount equal to all cash
dividends paid on one Common Share while the Stock Unit is outstanding.
Dividend equivalents may be converted into additional Stock Units. Settlement of
dividend equivalents may be made in the form of cash, in the form of Common
Shares, or in a combination of both.  Prior to distribution, any dividend
equivalents which are not paid shall be subject to the same conditions and
restrictions as the Stock Units to which they attach.

     ARTICLE 10.  PROTECTION AGAINST DILUTION.

     10.1  Adjustments.  In the event of a subdivision of the outstanding Common
Shares, a

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declaration of a dividend payable in Common Shares, a declaration of a dividend
payable in a form other than Common Shares in an amount that has a material
effect on the price of Common Shares, a combination or consolidation of the
outstanding Common Shares (by reclassification or otherwise) into a lesser
number of Common Shares, a recapitalization, a spinoff or a similar occurrence,
the Committee shall make such adjustments as it, in its sole discretion, deems
appropriate in one or more of:

          (a)  The number of Options, SARs, Restricted Shares and Stock Units
     available for future Awards under Article 3;

          (b)  The number of Stock Units included in any prior Award which has
     not yet been settled;

          (c)  The number of Common Shares covered by each outstanding Option
     and SAR; or

          (d)  The Exercise Price under each outstanding Option and SAR.

Except as provided in this Article 10, a Participant shall have no rights by
reason of any issue by the Company of stock of any class or securities
convertible into stock of any class, any subdivision or consolidation of shares
of stock of any class, the payment of any stock or other dividend or any other
increase or decrease in the number of shares of stock of any class.

     10.2  Reorganizations.  In the event that the Company is a party to a
merger or other reorganization, outstanding Options, SARs, Restricted Shares and
Stock Units shall be subject to the agreement of merger or reorganization.  Such
agreement may provide, without limitation, for the assumption of outstanding
Awards by the surviving corporation or its parent, for their continuation by the
Company (if the Company is a surviving corporation), for accelerated vesting and
accelerated expiration, or for settlement in cash.

     ARTICLE 11.  AWARDS UNDER OTHER PLANS.

     The Company may grant awards under other plans or programs.  Such awards
may be settled in the form of Common Shares issued under this Plan.  Such Common
Shares shall be treated for all purposes under the Plan like Common Shares
issued in settlement of Stock Units and shall, when issued, reduce the number of
Common Shares available under Article 3.

     ARTICLE 12.  PAYMENT OF DIRECTOR'S FEES IN SECURITIES .

     12.1  Effective Date.  No provision of this Article 12 shall be effective
unless and until the Board has determined to implement such provision.

     12.2  Elections to Receive NSOs or Stock Units.  An Outside Director may
elect to receive his or her annual retainer payments and meeting fees from the
Company in the form of cash, NSOs, Stock Units, or a combination thereof.  Such
NSOs and Stock Units shall be issued under the Plan.  An election under this
Article 12 shall be filed with the Company on the pre-

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scribed form and subject to such filing deadlines and election procedures as
shall be established by the Committee.

     12.3  Number and Terms of NSOs.  The number of NSOs to be granted to
Outside Directors in lieu of annual retainers and meeting fees that would
otherwise be paid in cash shall be calculated in a manner determined by the
Board.  The terms of such NSOs shall also be determined by the Board.

     12.4  Number and Terms of Stock Units.  The number of Stock Units to be
granted to Outside Directors shall be calculated by dividing the amount of the
annual retainer or the meeting fee that would otherwise be paid in cash by the
arithmetic mean of the Fair Market Values of a Common Share on the ten (10)
consecutive trading days ending with the date when such retainer or fee is
payable.  The terms of such Stock Units shall be determined by the Board.

     ARTICLE 13.  LIMITATION ON RIGHTS.

     13.1  Retention Rights.  Neither the Plan nor any Award granted under the
Plan shall be deemed to give any individual a right to remain an employee,
consultant or director of the Company, a Parent or a Subsidiary.  The Company
and its Parents and Subsidiaries reserve the right to terminate the service of
any employee, consultant or director at any time, and for any reason, subject to
applicable laws, the Company's certificate of incorporation and by-laws and a
written employment agreement (if any).

     13.2  Stockholders' Rights.  A Participant shall have no dividend rights,
voting rights or other rights as a stockholder with respect to any Common Shares
covered by his or her Award prior to the issuance of a stock certificate for
such Common Shares.  No adjustment shall be made for cash dividends or other
rights for which the record date is prior to the date when such certificate is
issued, except as expressly provided in Articles 8, 9 and 10.

     13.3  Regulatory Requirements.  Any other provision of the Plan
notwithstanding, the obligation of the Company to issue Common Shares under the
Plan shall be subject to all applicable laws, rules and regulations and such
approval by any regulatory body as may be required.  The Company reserves the
right to restrict, in whole or in part, the delivery of Common Shares pursuant
to any Award prior to the satisfaction of all legal requirements relating to the
issuance of such Common Shares, to their registration, qualification or listing
or to an exemption from registration, qualification or listing.

     ARTICLE 14.  LIMITATION ON PAYMENTS.

     14.1  Basic Rule.  Any provision of the Plan to the contrary
notwithstanding, in the event that the independent auditors most recently
selected by the Board (the "Auditors") determine that any payment or transfer by
the Company under the Plan to or for the benefit of a Participant (a "Payment")
would be nondeductible by the Company for federal income tax purposes because of
the provisions concerning "excess parachute payments" in section 280G of the
Code, then the aggregate present value of all Payments shall be reduced (but not
below

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zero) to the Reduced Amount; provided that the Committee, at the time of making
an Award under this Plan or at any time thereafter, may specify in
writing that such Award shall not be so reduced and shall not be subject to this
Article 14.  For purposes of this Article 14, the "Reduced Amount" shall be the
amount, expressed as a present value, which maximizes the aggregate present
value of the Payments without causing any Payment to be nondeductible by the
Company because of section 280G of the Code.

     14.2  Reduction of Payments.  If the Auditors determine that any Payment
would be nondeductible by the Company because of section 280G of the Code, then
the Company shall promptly give the Participant notice to that effect and a copy
of the detailed calculation thereof and of the Reduced Amount, and the
Participant may then elect, in his or her sole discretion, which and how much of
the Payments shall be eliminated or reduced (as long as after such election the
aggregate present value of the Payments equals the Reduced Amount) and shall
advise the Company in writing of his or her election within ten (10) days of
receipt of notice.  If no such election is made by the Participant within such
ten (10) day period, then the Company may elect which and how much of the
Payments shall be eliminated or reduced (as long as after such election the
aggregate present value of the Payments equals the Reduced Amount) and shall
notify the Participant promptly of such election.  For purposes of this Article
14, present value shall be determined in accordance with section 280G(d)(4) of
the Code.  All determinations made by the Auditors under this Article 14 shall
be binding upon the Company and the Participant and shall be made within sixty
(60) days of the date when a Payment becomes payable or transferable.  As
promptly as practicable following such determination and the elections
hereunder, the Company shall pay or transfer to or for the benefit of the
Participant such amounts as are then due to him or her under the Plan and shall
promptly pay or transfer to or for the benefit of the Participant in the future
such amounts as become due to him or her under the Plan.

     14.3  Overpayments and Underpayments.  As a result of uncertainty in the
application of section 280G of the Code at the time of an initial determination
by the Auditors hereunder, it is possible that Payments will have been made by
the Company which should not have been made (an "Overpayment") or that
additional Payments which will not have been made by the Company could have been
made (an "Underpayment"), consistent in each case with the calculation of the
Reduced Amount hereunder.  In the event that the Auditors, based upon the
assertion of a deficiency by the Internal Revenue Service against the Company or
the Participant which the Auditors believe has a high probability of success,
determine that an Overpayment has been made, such Overpayment shall be treated
for all purposes as a loan to the Participant which he or she shall repay to the
Company, together with interest at the applicable federal rate provided in
section 7872(f)(2) of the Code; provided, however, that no amount shall be
payable by the Participant to the Company if and to the extent that such payment
would not reduce the amount which is subject to taxation under section 4999 of
the Code.  In the event that the Auditors determine that an Underpayment has
occurred, such Underpayment shall promptly be paid or transferred by the Company
to or for the benefit of the Participant, together with interest at the
applicable federal rate provided in section 7872(f)(2) of the Code.

     14.4  Related Corporations.  For purposes of this Article 14, the term
"Company" shall

                                      -10-
<PAGE>

include affiliated corporations to the extent determined by the Auditors in
accordance with section 280G(d)(5) of the Code.

     ARTICLE 15.  WITHHOLDING TAXES.

     15.1  General.  To the extent required by applicable federal, state, local
or foreign law, a Participant or his or her successor shall make arrangements
satisfactory to the Company for the satisfaction of any withholding tax
obligations that arise in connection with the Plan.  The Company shall not be
required to issue any Common Shares or make any cash payment under the Plan
until such obligations are satisfied.

     15.2  Share Withholding.  A Participant may satisfy all or part of his or
her withholding or income tax obligations by having the Company withhold all or
a portion of any Common Shares that otherwise would be issued to him or her or
by surrendering all or a portion of any Common Shares that he or she previously
acquired.  Such Common Shares shall be valued at their Fair Market Value on the
date when taxes otherwise would be withheld in cash.  Any payment of taxes by
assigning Common Shares to the Company may be subject to restrictions.

     ARTICLE 16.  ASSIGNMENT OR TRANSFER OF AWARDS.

     16.1  General.  Except as provided in Article 15 or the Award agreement, an
Award granted under the Plan shall not be anticipated, assigned, attached,
garnished, optioned, transferred or made subject to any creditor's process,
whether voluntarily, involuntarily or by operation of law.  Except as provided
in the Award agreement, an Option or SAR may be exercised during the lifetime of
the Optionee only by him or her or by his or her guardian or legal
representative.  This Article 16 shall not preclude a Participant from
designating a beneficiary who will receive any outstanding Awards in the event
of the Participant's death, nor shall it preclude a transfer of Awards by will
or by the laws of descent and distribution.

     ARTICLE 17.  FUTURE OF THE PLAN.

     17.1  Term of the Plan.  The Plan, as amended and restated, shall become
effective on July 7, 1997.  The Plan shall remain in effect until it is
terminated under Section 17.2, except that no ISOs shall be granted after
September 17, 2006.

     17.2  Amendment or Termination.  The Board may, at any time and for any
reason, amend or terminate the Plan.  An amendment of the Plan shall be subject
to the approval of the Company's stockholders only to the extent required by
applicable laws, regulations or rules.  No Awards shall be granted under the
Plan after the termination thereof.  The termination of the Plan, or any
amendment thereof, shall not affect any Award previously granted under the Plan.

     ARTICLE 18.  DEFINITIONS.

     18.1  "Award" means any award of an Option, an SAR, a Restricted Share or a
Stock Unit under the Plan.

                                      -11-
<PAGE>

     18.2  "Board" means the Company's Board of Directors, as constituted from
time to time.

     18.3  "Change in Control" shall be deemed to occur upon any "person" (as
defined in Section 13(d) of the Exchange Act), other than the Company, its
Parent or Subsidiary or employee benefit plan or trust maintained by the
Company, its Parent or Subsidiary, becoming the "beneficial owner" (as defined
in Rule 13d-3 of the Exchange Act), directly or indirectly, of more than 50% of
the total combined voting power of the Class A and Class B common stock of the
Company outstanding at such time, without the prior approval of the Board.

     18.4  "Code" means the Internal Revenue Code of 1986, as amended.

     18.5  "Committee" means a committee of the Board, as described in
Article 2.

     18.6  "Common Share" means one share of the Class A common stock of the
Company.

     18.7  "Company" means Network Solutions, Inc., a Delaware corporation, or
its successor.

     18.8  "Exchange Act" means the Securities Exchange Act of 1934, as amended.

     18.9  "Exercise Price," in the case of an Option, means the amount for
which one Common Share may be purchased upon exercise of such Option, as
specified in the applicable Stock Option Agreement.  "Exercise Price," in the
case of an SAR, means an amount, as specified in the applicable SAR Agreement,
which is subtracted from the Fair Market Value of one Common Share in
determining the amount payable upon exercise of such SAR.

     18.10  "Fair Market Value" means the market price of Common Shares,
determined by the Committee as follows:

            (a)  If the Common Shares were traded over-the-counter on the date
     in question but were not classified as a national market issue, then the
     Fair Market Value shall be equal to the mean between the last reported
     representative bid and asked prices quoted by the Nasdaq system for such
     date;

            (b)  If the Common Shares were traded over-the-counter on the date
     in question and were classified as a national market issue, then the Fair
     Market Value shall be equal to the last-transaction price quoted by the
     Nasdaq system for such date;

            (c)  If the Common Shares were traded on a stock exchange on the
     date in question, then the Fair Market Value shall be equal to the closing
     price reported by the applicable composite transactions report for such
     date; and

            (d)  If none of the foregoing provisions is applicable, then the
     Fair Market Value shall be determined by independent appraisals or as
     otherwise

                                      -12-
<PAGE>

     determined by the Committee in good faith on such basis as it deems
     appropriate.

Whenever possible, the determination of Fair Market Value by the Committee shall
be based on the prices reported in the Western Edition of The Wall Street
Journal.  Such determination shall be conclusive and binding on all persons.

     18.11  "ISO" means an incentive stock option described in section 422(b) of
the Code.

     18.12  "Key Employee" means (a) a common-law employee of the Company, a
Parent or a Subsidiary, (b) an Outside Director and (c) a consultant or adviser
who provides services to the Company, a Parent or a Subsidiary as an independent
contractor.

     18.13  "NSO" means a stock option not described in sections 422 or 423 of
the Code.

     18.14  "Option" means an ISO or NSO granted under the Plan and entitling
the holder to purchase one Common Share.

     18.15  "Optionee" means an individual or estate who holds an Option or SAR.

     18.16  "Outside Director" shall mean a member of the Board who is not a
common-law employee of the Company, a Parent or a Subsidiary.

     18.17  "Parent" means any corporation (other than the Company) in an
unbroken chain of corporations ending with the Company, if each of the
corporations other than the Company owns stock possessing fifty percent (50%) or
more of the total combined voting power of all classes of stock in one of the
other corporations in such chain.  A corporation that attains the status of a
Parent on a date after the adoption of the Plan shall be considered a Parent
commencing as of such date.

     18.18  "Participant" means an individual or estate who holds an Award.

     18.19  "Plan" means the Network Solutions, Inc. 1996 Stock Incentive Plan,
as amended from time to time.

     18.20  "Restricted Share" means a Common Share awarded under the Plan.

     18.21  "SAR" means a stock appreciation right granted under the Plan.

     18.22  "SAR Agreement" means the agreement between the Company and an
Optionee which contains the terms, conditions and restrictions pertaining to his
or her SAR.

     18.23  "Stock Award Agreement" means the agreement between the Company and
the recipient of a Restricted Share or Stock Unit which contains the terms,
conditions and restrictions pertaining to such Restricted Share or Stock Unit.

                                      -13-
<PAGE>

     18.24  "Stock Option Agreement" means the agreement between the Company
and an Optionee which contains the terms, conditions and restrictions pertaining
to his or her Option.

     18.25  "Stock Unit" means a bookkeeping entry representing the equivalent
of one Common Share, as awarded under the Plan.

     18.26  "Subsidiary" means any corporation (other than the Company) in an
unbroken chain of corporations beginning with the Company, if each of the
corporations other than the last corporation in the unbroken chain owns stock
possessing fifty percent (50%) or more of the total combined voting power of all
classes of stock in one of the other corporations in such chain.  A corporation
that attains the status of a Subsidiary on a date after the adoption of the Plan
shall be considered a Subsidiary commencing as of such date.

     ARTICLE 19.  EXECUTION.

     To record the adoption of the amended and restated Plan by the Board, the
Company has caused its duly authorized officer to affix the corporate name and
seal hereto.

                               NETWORK SOLUTIONS, INC.

                               By  /s/ Gabriel A. Battista

                               Its  Chief Executive Officer

                                      -14-
<PAGE>

                            NETWORK SOLUTIONS, INC.
                           1996 STOCK INCENTIVE PLAN

                      NONSTATUTORY STOCK OPTION AGREEMENT

     Network Solutions, Inc., a Delaware corporation (the "Company"), hereby
grants an Option to purchase shares of its Common Stock ("Common Shares") to the
Optionee named below.  The terms and conditions of the Option are set forth in
this cover sheet, in the attachment and in the Company's 1996 Stock Incentive
Plan (the "Plan"), as amended and restated effective July 7, 1997.

Date of Grant:

Name of Optionee

Optionee's Social Security Number:

Number of Common Shares Covered by Option:

Exercise Price per Common Share:

Vesting Start Date:

Vesting Schedule:  Subject to the attached Agreement, during your Service the
Option shall vest as to 30%, 30%, 20% and 20% of the Common Shares on the first
through fourth anniversaries, respectively, of the Vesting Start Date.  In the
event your employment terminates due to death or disability, you will receive
pro rata vesting credit for each whole month of Service you complete.  (For
example, the Option will be 15% vested if your employment terminates due to
disability 6 months after the Vesting Start Date.)

     By signing this cover sheet, you voluntarily agree to all of the terms and
     conditions described in the attached Agreement and in the Plan, a copy of
     which is also attached.

Optionee:
                                    (Signature)

Company:
                                    (Signature)

          Title:  ___________________________________________________________
<PAGE>

                            NETWORK SOLUTIONS, INC.
                           1996 STOCK INCENTIVE PLAN

                      NONSTATUTORY STOCK OPTION AGREEMENT

<TABLE>
<CAPTION>
Nonstatutory Stock         This Option is not intended to be an incentive stock option under
Option                     section 422 of the Internal Revenue Code and will be interpreted
                           accordingly.

<S>                        <C>
Vesting                    Your right to exercise this Option vests during your Service as
                           shown on the cover sheet.  The number of vested Common Shares shall
                           be rounded to the next lower whole number.  No additional Common
                           Shares will vest after your Service has terminated for any reason.
Service                    Your "Service" continues while you are actively employed by, or
                           serving as a consultant to or director of, the Company determined
                           in the sole discretion of the Company.  For purposes of determining
                           whether your Service has terminated, a transfer to employment with
                           any parent or other affiliate of the Company shall constitute a
                           termination of employment with the Company; however, Service will
                           continue if you retain a relationship with the Company as a
                           consultant or director as described above.  For purposes of this
                           Option, your Service does not terminate when you go on a bona fide
                           leave of absence that was approved by the Company in writing, if
                           the terms of the leave provide for continued Service crediting, or
                           when continued Service crediting is required by applicable law.
                           Your Service terminates in any event when the approved leave ends,
                           unless you immediately return to active work.  The Company
                           determines which leaves shall be credited toward Service, and when
                           your Service terminates, for all purposes under the Plan and this
                           Agreement.

Term                       Your Option will expire in any event at the close of business at
                           Company headquarters on the day before the fifth anniversary of the
                           date of grant of the terminated Option.  (It will expire earlier if
                           your Service terminates, as described below.)  IMPORTANT: If a
                           properly executed "Notice of Exercise" form, together with payment
                           for the exercise price and tax withholding, are not received by the
                           Company prior to the expiration of the term of this Option, all
                           rights to acquire Common Shares under this Agreement will be
                           forfeited.

Regular Termination        If your Service terminates for any reason except death or
                           Disability, your Option will expire at the close of business at
                           Company headquarters on the 90th day after your termination date.
                           During such 90-day period, you may exercise that portion of your
                           Option that was vested on your Service termination date.
</TABLE>

                                       2
<PAGE>

<TABLE>
<S>                        <C>
Death                      If you die while in Service, your Option will expire at the close
                           of business at Company headquarters on the date 12 months after the
                           date of death.  During that 12-month period, your beneficiary,
                           estate or heirs may exercise that portion of your Option that was
                           vested on your date of death.

Disability                 If your Service terminates because of your Disability, your Option
                           will expire at the close of business at Company headquarters on the
                           date 12 months after your Service termination date.  During such
                           12-month period, you may exercise that portion of your Option that
                           was vested on your date of Disability.

                           "Disability" means that you are unable to engage in any substantial
                           gainful activity by reason of any 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, as determined pursuant to Section
                           22(e)(3) of the Internal Revenue Code of 1986, as amended.

Notice of Exercise         When you wish to exercise this Option, you must notify the
                           Committee by filing the proper "Notice of Exercise" form at the
                           address given on the form together with payment of the Exercise
                           Price and any required tax withholding, as described below.  Your
                           Notice of Exercise must specify how many Common Shares you wish to
                           purchase and how your Common Shares should be registered (in your
                           name only, in your and your spouse's names as community property or
                           as joint tenants with right of survivorship or in a trust for your
                           benefit).  The Notice of Exercise will be effective when it is
                           received by the Committee.  If someone else wants to exercise this
                           Option after your death, that person must prove to the Committee's
                           satisfaction that he or she is entitled to do so.

Form of Payment            When you submit your Notice of Exercise, you must include payment
                           of the Exercise Price for the Common Shares you are purchasing.
                           Payment may be made in one (or a combination) of the following
                           forms:

                           .  Your personal check, a cashier's check or a money order.

                           .  Common Shares which have already been owned by you for more
                              than six months and which are surrendered to the Company. The
                              value of the Common Shares, determined as of the effective
                              date of the Option exercise, will be applied to the Exercise Price.

                           .  By delivery (on a form prescribed by the Committee) of an
                              irrevocable direction to a securities broker to sell Common Shares
                              and to deliver all or part of the sale proceeds to the Company in
                              payment of the aggregate Exercise Price.
</TABLE>

                                       3
<PAGE>

<TABLE>
<S>                        <C>
Withholding Taxes          You will not be allowed to exercise this Option unless you make
                           acceptable arrangements to pay any withholding or other taxes that
                           may be due as a result of the option exercise or the sale of Common
                           Shares acquired upon exercise of this Option.

Restrictions               By signing this Agreement, you agree not to sell any Common Shares
on Exercise                at a time when prohibited by applicable laws, regulations or
and Resale                 Company or underwriter trading policies.  In connection with any
                           underwritten public offering by the Company of its equity
                           securities pursuant to an effective registration statement filed
                           under the Securities Act, you agree not to sell, make any short
                           sale of, loan, hypothecate, pledge, grant any option for the
                           purchase of, or otherwise dispose or transfer for value or agree to
                           engage in any of the foregoing transactions with respect to any
                           Common Shares without the prior written consent of the Company or
                           its underwriters, for such period of time after the effective date
                           of such registration statement as may be requested by the Company
                           or such underwriters.

                           In order to enforce the provisions of this paragraph, the Company
                           may impose stop-transfer instructions with respect to the Common
                           Shares.

                           In the event that the sale of Common Shares under the Plan is not
                           registered under the Securities Act but an exemption is available
                           that requires an investment representation or other representation,
                           you shall represent and agree at the time of exercise that the
                           Common Shares being acquired upon exercising this Option are being
                           acquired for investment, and not with a view to the sale or
                           distribution thereof, and shall make such other representations as
                           are deemed necessary or appropriate by the Company and its counsel.

Transfer of Option         Prior to your death, only you may exercise this Option.  You cannot
                           transfer or assign this Option.  For instance, you may not sell
                           this Option or use it as security for a loan.  If you attempt to do
                           any of these things, this Option will immediately become invalid.
                           You may, however, dispose of this Option by beneficiary designation
                           or in your will.

                           Regardless of any marital property settlement agreement, the
                           Company is not obligated to honor a Notice of Exercise from your
                           spouse or former spouse, nor is the Company obligated to recognize
                           such individual's interest in your Option in any other way.

Retention Rights           This Agreement does not give you the right to be retained by the
                           Company in any capacity.  The Company reserves the right to
                           terminate your Service at any time and for any reason.
</TABLE>

                                       4
<PAGE>

<TABLE>
<S>                        <C>
Stockholders Rights        You, or your estate or heirs, have no rights as a stockholder of
                           the Company until a certificate for the Common Shares acquired upon
                           exercise of this Option has been issued.  No adjustments are made
                           for dividends or other rights if the applicable record date occurs
                           before your stock certificate is issued, except as described in the
                           Plan.

Adjustments                In the event of a stock split, a stock dividend or a similar change
                           in the Common Shares, the number of Common Shares covered by this
                           Option and the Exercise Price per share may be adjusted pursuant to
                           the Plan.  Your Option shall be subject to the terms of the
                           agreement of merger, liquidation or reorganization in the event the
                           Company is subject to such corporate activity.

Legends                    All certificates representing the Common Shares issued upon
                           exercise of this Option shall have endorsed thereon any legends
                           required by applicable law.

Applicable Law             This Agreement will be interpreted and enforced under the laws of
                           the State of Delaware (without regard to their choice of law
                           provisions).

The Plan and               The text of the Plan is incorporated in this Agreement by
Other Agreements           reference.  Certain capitalized terms used in this Agreement are
                           defined in the Plan.

                           This Agreement and the Plan constitute the entire understanding
                           between you and the Company regarding this Option and the
                           terminated Option.  Any prior agreements, commitments or
                           negotiations concerning this Option are superseded.
</TABLE>

     By signing the cover sheet of this Agreement, you agree to all of the terms
     and conditions described above and in the Plan.

                                       5<PAGE>
                                                                    EXHIBIT 4.09

                               PAYMENTNET, INC.

                               1998 STOCK PLAN

     1.  Purposes of the Plan. The purposes of this 1998 Stock Plan are to
         --------------------
attract and retain the best available personnel for positions of substantial
responsibility, to provide additional incentive to Employees and Consultants of
the Company and its Subsidiaries and to promote the success of the Company's
business. Options granted under the Plan may be Incentive Stock Options (as
defined under Section 422 of the Code) or Nonstatutory Stock Options, as
determined by the Administrator at the time of grant of an option and subject to
the applicable provisions of Section 422 of the Code, as amended, and the
regulations promulgated thereunder. Stock purchase rights may also be granted
under the Plan.

     2.  Definitions. As used herein, the following definitions shall apply:
         -----------

          (a)  "Administrator" means the Board or any of its Committees
                -------------
appointed pursuant to Section 4 of the Plan.

          (b)  "Board" means the Board of Directors of the Company.
                -----

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

          (d)  "Committee" means the Committee appointed by the Board of
                ---------
Directors in accordance with Section 4(a) and (b) of the Plan.

          (e)  "Common Stock" means the Common Stock of the Company.
                ------------

          (f)  "Company" means PAYMENTNET, INC., a California corporation.
                -------

          (g)  "Consultant" means any person, including an advisor, who is
                ----------
engaged by the Company or any Parent or Subsidiary to render services and is
compensated for such services, and any director of the Company whether
compensated for such services or not.

          (h) "Continuous Status as an Employee or Consultant" means the absence
               ----------------------------------------------
of any interruption or termination of service as an Employee or Consultant.
Continuous Status as an Employee or Consultant shall not be considered
interrupted in the case of: (i) sick leave; (ii) military leave; (iii) any other
leave of absence approved by the Administrator, provided that such leave is for
a period of not more than 90 days, unless reemployment upon the expiration of
such leave is guaranteed by contract or statute, or unless provided otherwise
pursuant to Company policy adopted from time to time; or (iv) in the case of
transfers between locations of the Company or between the Company, its
Subsidiaries or their respective successors. For purposes of this Plan, a change
in status from an Employee to a Consultant or from a Consultant to an Employee
will not constitute an interruption of Continuous Status as an Employee or
Consultant.
<PAGE>

          (i) "Employee" means any person, including officers and directors,
               --------
employed by the Company or any Parent or Subsidiary of the Company, with the
status of employment determined based upon such minimum number of hours or
periods worked as shall be determined by the Administrator in its discretion,
subject to any requirements of the Code. The payment by the Company of a
director's fee to a director shall not be sufficient to constitute "employment"
of such director by the Company.

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

          (k) "Fair Market Value" means, as of any date, the fair market value
               -----------------
of Common Stock determined as follows:

              (i)   If the Common Stock is listed on any established stock
exchange or a national market system including without limitation the National
Market of the National Association of Securities Dealers, Inc. Automated
Quotation ("Nasdaq") System, its Fair Market Value shall be the closing sales
            ------
price for such stock (or the closing bid, if no sales were reported), as quoted
on such system or exchange, or the exchange with the greatest volume of trading
in Common Stock for the last market trading day prior to the time of
determination, as reported in The Wall Street Journal or such other source as
the Administrator deems reliable;

              (ii)  If the Common Stock is quoted on the Nasdaq System (but not
on the National Market thereof) or regularly quoted by a recognized securities
dealer but selling prices are not reported, its Fair Market Value shall be the
mean between the high bid and low asked prices for the Common Stock for the last
market trading day prior to the time of determination, as reported in The Wall
Street Journal or such other source as the Administrator deems reliable; or

              (iii) In the absence of an established market for the Common
Stock, the Fair Market Value thereof shall be determined in good faith by the
Administrator.

          (1) "Incentive Stock Option" means an Option intended to qualify as an
               ----------------------
incentive stock option within the meaning of Section 422 of the Code, as
designated in the applicable written Option Agreement.

          (m) "Nonstatutory Stock Option" means an Option not intended to
               -------------------------
qualify as an Incentive Stock Option, as designated in the applicable written
Option Agreement.

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

          (o) "Option Agreement" means a written agreement between an Optionee
               ----------------
and the Company reflecting the terms of an Option granted under the Plan and
includes any documents attached to such Option Agreement, including, but not
limited to, a notice of stock option grant and a form of exercise notice.

          (p) "Optioned Stock" means the Common Stock subject to an Option or a
               --------------
Stock Purchase Right.
<PAGE>

          (q) "Optionee" means an Employee or Consultant who receives an Option
               --------
or a Stock Purchase Right.

          (r) "Parent" means a "parent corporation," whether now or hereafter
               ------
existing, as defined in Section 424(e) of the Code, or any successor provision.

          (s) "Plan" means this 1998 Stock Plan.
               ----

          (t) "Reporting Person" means an officer, director, or greater than 10%
               ----------------
stockholder of the Company within the meaning of Rule 16a-2 under the Exchange
Act, who is required to file reports pursuant to Rule 16a-3 under the Exchange
Act.

          (u) "Restricted Stock" means shares of Common Stock acquired pursuant
               ----------------
to a grant of a Stock Purchase Right under Section 10 below.

          (v) "Restricted Stock Purchase Agreement" means a written agreement
               -----------------------------------
between a holder of a Stock Purchase Right and the Company reflecting the terms
of a Stock Purchase Right granted under the Plan and includes any documents
attached to such agreement.

          (w) "Rule 16b-3" means Rule 16b-3 promulgated under the Exchange Act,
               ----------
as the same may be amended from time to time, or any successor provision.

          (x) "Share" means a share of the Common Stock, as adjusted in
               -----
accordance with Section 12 of the Plan.

          (y) "Stock Exchange" means any stock exchange or consolidated stock
               --------------
price reporting system on which prices for the Common Stock are quoted at any
given time.

          (z) "Stock Purchase Right" means the right to purchase Common Stock
               --------------------
pursuant to Section 10 below.

          (aa) "Subsidiary" means a "subsidiary corporation," whether now or
                ----------
hereafter existing, as defined in Section 424(0 of the Code, or any successor
provision.

     3.  Stock Subject to the Plan. Subject to the provisions of Section 12 of
         -------------------------
the Plan, the maximum aggregate number of Shares that may be optioned and sold
under the Plan is 13,880,621 shares of Common Stock The Shares may be
authorized, but unissued, or reacquired Common Stock. If an Option should expire
or become unexercisable for any reason without having been exercised in full,
the unpurchased Shares that were subject thereto shall, unless the Plan shall
have been terminated, become available for future grant under the Plan. In
addition, any Shares of Common Stock which are retained by the Company upon
exercise of an Option or Stock Purchase Right in order to satisfy the exercise
or purchase price for such Option or Stock Purchase Right or any withholding
taxes due with respect to such exercise shall be treated as not issued and shall
continue to be available under the Plan. Shares repurchased by the Company
pursuant to any repurchase right which the Company may have shall not be
available for future grant under the Plan.
<PAGE>

     4.   Administration of the Plan.
          --------------------------

          (a) Initial Plan Procedure. Prior to the date, if any, upon which the
              ----------------------
Company becomes subject to the Exchange Act, the Plan shall be administered by
the Board or a Committee appointed by the Board.

          (b) Plan Procedure After the Date, if any, Upon Which the Company
              -------------------------------------------------------------
Becomes Subject to the Exchange Act.
-----------------------------------

              (i)   Multiple Administrative Bodies. If permitted by Rule 16b-3,
                    ------------------------------
grants under the Plan may be made by different bodies with respect to directors,
non-director officers and Employees or Consultants who are not Reporting
Persons.

              (ii)  Administration With Respect to Reporting Persons. With
                    ------------------------------------------------
respect to grants of Options or Stock Purchase Rights to Employees who are
Reporting Persons, such grants shall be made by (A) the Board if the Board may
make grants to Reporting Persons under the Plan in compliance with Rule 16b-3,
or (B) a Committee designated by the Board to make grants to Reporting Persons
under the Plan, which Committee shall be constituted in such a manner as to
permit grants under the Plan to comply with Rule 16b-3. Once appointed, such
Committee shall continue to serve in its designated capacity until otherwise
directed by the Board. From time to time the Board may increase the size of the
Committee and appoint additional members thereof, remove members (with or
without cause) and appoint new members in substitution therefor, fill vacancies,
however caused, and remove all members of the Committee and thereafter directly
make grants to Reporting Persons under the Plan, all to the extent permitted by
Rule 16b-3.

              (iii) Administration With Respect to Consultants and Other
                    ----------------------------------------------------
Employees. With respect to grants of Options or Stock Purchase Rights to
---------
Employees or Consultants who are not Reporting Persons, the Plan shall be
administered by (A) the Board or (B) a Committee designated by the Board, which
Committee shall be constituted in such a manner as to satisfy the legal
requirements relating to the administration of Incentive Stock Option plans, if
any, of applicable corporate and securities laws, of the Code and of any
applicable Stock Exchange (the "Applicable Laws"). Once appointed, such
                                ---------------
Committee shall continue to serve in its designated capacity until otherwise
directed by the Board. From time to time the Board may increase the size of the
Committee and appoint additional members thereof, remove members (with or
without cause) and appoint new members in substitution therefor, fill vacancies,
however caused, and remove all members of the Committee and thereafter directly
administer the Plan, all to the extent permitted by the Applicable Laws.

          (c) Powers of the Administrator. Subject to the provisions of the Plan
              ---------------------------
and in the case of a Committee, the specific duties delegated by the Board to
such Committee, and subject to the approval of any relevant authorities,
including the approval, if required, of any Stock Exchange, the Administrator
shall have the authority, in its discretion:

              (i)     to determine the Fair Market Value of the Common Stock, in
accordance with Section 2(k) of the Plan;
<PAGE>

              (ii)    to select the Consultants and Employees to whom Options
and Stock Purchase Rights or any combination thereof may from time to time be
granted hereunder;

              (iii)   to determine whether and to what extent Options and Stock
Purchase Rights or any combination thereof are granted hereunder;

              (iv)    to determine the number of shares of Common Stock to be
covered by each such award granted hereunder;

              (v)     to approve forms of agreement for use under the Plan;

              (vi)    to determine the terms and conditions, not inconsistent
with the terms of the Plan, of any award granted hereunder;

              (vii)   to determine whether and under what circumstances an
Option may be settled in cash under Section 9(0 instead of Common Stock;

              (viii)  to reduce the exercise price of any Option to the then
current Fair Market Value if the Fair Market Value of the Common Stock covered
by such Option shall have declined since the date the Option was granted;

              (ix)    to determine the terms and restrictions applicable to
Stock Purchase Rights and the Restricted Stock purchased by exercising such
Stock Purchase Rights; and

              (x)     to construe and interpret the terms of the Plan and awards
granted pursuant to the Plan; and

              (xi)    in order to fulfill the purposes of the Plan and without
amending the Plan, to modify grants of Options or Stock Purchase Rights to
participants who are foreign nationals or employed outside of the United States
in order to recognize differences in local law, tax policies or customs.

          (d) Effect of Administrator's Decision, All decisions, determinations
              ------------------------------------
and interpretations of the Administrator shall be final and binding on all
holders of Options or Stock Purchase Rights.

     5.   Eligibility.
          -----------

          (a) Recipients of Grants. Nonstatutory Stock Options and Stock
              --------------------
Purchase Rights may be granted to Employees and Consultants. Incentive Stock
Options may be granted only to Employees. An Employee or Consultant who has been
granted an Option or Stock Purchase Right may, if he or she is otherwise
eligible, be granted additional Options or Stock Purchase Rights.

          (b) Type of Option. Each Option shall be designated in the Option
              --------------
Agreement as either an Incentive Stock Option or a Nonstatutory Stock Option.
However,
<PAGE>

notwithstanding such designations, to the extent that the aggregate Fair Market
Value of Shares with respect to which Options designated as Incentive Stock
Options are exercisable for the first time by any Optionee during any calendar
year (under all plans of the Company or any Parent or Subsidiary) exceeds
$100,000, such excess Options shall be treated as Nonstatutory Stock Options.
For purposes of this Section 5(b), Incentive Stock Options shall be taken into
account in the order in which they were granted, and the Fair Market Value of
the Shares subject to an Incentive Stock Option shall be determined as of the
date of the grant of such Option.

         (c) The Plan shall not confer upon the holder of any Option or Stock
Purchase Right any right with respect to continuation of employment or
consulting relationship with the Company, nor shall it interfere in any way with
such holder's right or the Company's right to terminate his or her employment or
consulting relationship at any time, with or without cause.

     6.  Term of Plan. The Plan shall become effective upon the earlier to occur
         ------------
of its adoption by the Board of Directors or its approval by the stockholders of
the Company as described in Section 19 of the Plan. It shall continue in effect
for a term often years unless sooner terminated under Section 15 of the Plan.

     7.  Term of Option. The term of each option shall be the term stated in the
         --------------
Option Agreement; provided, however, that the term shall be no more than ten
years from the date of grant thereof or such shorter term as may be provided in
the Option Agreement and provided further that, in the case of an Incentive
Stock Option granted to an Optionee who, at the time the Option is granted, owns
stock representing more than 10% of the total combined voting power of all
classes of stock of the Company or any Parent or Subsidiary, the term of the
Option shall be five years from the date of grant thereof or such shorter term
as may be provided in the Option Agreement.

     8.  Option Exercise Price and Consideration.
         ----------------------------------------

         (a) The per share exercise price for the Shares to be issued pursuant
to exercise of an Option shall be such price as is determined by the Board and
set forth in the applicable agreement, but shall be subject to the following:

              (i)    In the case of an Incentive Stock Option that is:

                      (A) granted to an Employee who, at the time of the grant
of such Incentive Stock Option, owns stock representing more than 10% of the
total combined voting power of all classes of stock of the Company or any Parent
or Subsidiary, the per Share exercise price shall be no less than 110% of the
Fair Market Value per Share on the date of grant.

                      (B) granted to any other Employee, the per Share exercise
price shall be no less than 100% of the Fair Market Value per Share on the date
of grant.

              (ii)    In the case of a Nonstatutory Stock Option that is:
<PAGE>

                      (A) granted to a person who, at the time of the grant of
such Option, owns stock representing more than 10% of the total combined voting
power of all classes of stock of the Company or any Parent or Subsidiary, the
per Share exercise price shall be no less than 110% of the Fair Market Value per
Share on the date of the grant.

                      (B) granted to any person, the per Share exercise price
shall be no less than 85% of the Fair Market Value per Share on the date of
grant.

          (b) The consideration to be paid for the Shares to be issued upon
exercise of an Option, including the method of payment, shall be determined by
the Administrator (and, in the case of an Incentive Stock Option, shall be
determined at the time of grant) and may consist entirely of (1) cash, (2)
check, (3) promissory note (subject to the provisions of Section 153 of the
Delaware General Corporation Law), (4) other Shares that (x) in the case of
Shares acquired upon exercise of an Option, have been owned by the Optionee for
more than six months on the date of surrender or such other period as may be
required to avoid a charge to the Company's earnings, and (y) have a Fair Market
Value on the date of surrender equal to the aggregate exercise price of the
Shares as to which such Option shall be exercised, (5) authorization for the
Company to retain from the total number of Shares as to which the Option is
exercised that number of Shares having a Fair Market Value on the date of
exercise equal to the exercise price for the total number of Shares as to which
the Option is exercised, (6) delivery of a properly executed exercise notice
together with such other documentation as the Administrator and the broker, if
applicable, shall require to effect an exercise of the Option and delivery to
the Company of the sale or loan proceeds required to pay the exercise price and
any applicable income or employment taxes, (7) delivery of an irrevocable
subscription agreement for the Shares that irrevocably obligates the option
holder to take and pay for the Shares not more than twelve months after the date
of delivery of the subscription agreement, (8) any combination of the foregoing
methods of payment, or (9) such other consideration and method of payment for
the issuance of Shares to the extent permitted under the Applicable Laws. In
making its determination as to the type of consideration to accept, the
Administrator Shall consider if acceptance of such consideration may be
reasonably expected to benefit the Company.

     9.  Exercise of Option.
         ------------------

          (a) Procedure for Exercise; Rights as a Stockholder. Any Option
              -----------------------------------------------
granted hereunder shall be exercisable at such times and under such conditions
as determined by the Administrator and reflected in the Option Agreement, which
may include vesting requirements and/or performance criteria with respect to the
Company and/or the Optionee; provided, however, that such Option shall become
exercisable at the rate of at least 20% per year over five years from the date
the Option is granted. In the event that any of the Shares issued upon exercise
of an Option should be subject to a right of repurchase in the Company's favor,
such repurchase right shall lapse at the rate of at least 20% per year over five
years from the date the Option is granted. Notwithstanding the above, in the
case of an option granted to an officer, director or Consultant of the Company
or any Parent or Subsidiary of the Company, the option may become fully
exercisable, and a repurchase right, if any, in favor of the Company shall
lapse, at any time or during any period established by the Administrator.
<PAGE>

     An Option may not be exercised for a fraction of a Share.

     An Option shall be deemed to be exercised when written notice of such
exercise has been given to the Company in accordance with the terms of the
Option by the person entitled to exercise the Option and the Company has
received full payment for the Shares with respect to which the Option is
exercised. Full payment may, as authorized by the Board, consist of any
consideration and method of payment allowable under Section 8(b) of the Plan.
Until the issuance (as evidenced by the appropriate entry on the books of the
Company or of a duly authorized transfer agent of the Company) of the stock
certificate evidencing such Shares, no right to vote or receive dividends or any
other rights as a stockholder shall exist with respect to the Optioned Stock,
not withstanding the exercise of the Option. The Company shall issue (or cause
to be issued) such stock certificate promptly upon exercise of the Option. No
adjustment will be made for a dividend or other right for which the record date
as prior to the date the stock certificate is issued, except as provided in
Section 12 of the Plan.

     Exercise of an Option in any manner shall result in a decrease in the
number of Shares that thereafter may be available, both for purposes of the Plan
and for sale under the option, by the number of Shares as to which the option is
exercised.

          (b) Termination of Employment or Consulting Relationship. Subject to
              ----------------------------------------------------
Section 9(c) below, in the event of termination of an Optionee's Continuous
Status as an Employee or Consultant with the Company, such Optionee may, but
only within three months (or such other period of time not less than 30 days as
is determined by the Administrator, with such determination in the case of an
Incentive: Stock Option being made at the time of grant of the Option and not
exceeding three months) after the date of such termination (but in no event
later than the expiration date of the term of such Option as set forth in the
Option Agreement), exercise his or her option to the extent that the Optionee
was entitled to exercise it at the date of such termination. To the extent that
the Optionee was not entitled to exercise the Option at the date of such
termination, or if the Optionee does not exercise such Option to the extent so
entitled within the time specified herein, the Option shall terminate. No
termination shall be deemed to occur and this Section 9(b) shall not apply if
(i) the Optionee is a Consultant who becomes an Employee, or (ii) the Optionee
is an Employee who becomes a Consultant.

          (c) Disability of Optionee.
              ----------------------

              (i)     Notwithstanding Section 9(b) above, in the event of
termination of an Optionee's Continuous Status as an Employee or Consultant as a
result of his or her total and permanent disability (within the meaning of
Section 22(e)(3) of the Code), such Optionee may, but only with 12 months from
the date months from the date of such termination (but in no event later than
the expiration date of the term of such Option as set forth in the Option
Agreement). exercise the Option to the extent otherwise entitled to exercise it
at the date of such termination. To the extent that the Optionee was not
entitled to exercise the Option at the date of termination, or if the Optionee
does not exercise such Option to the extent so entitled within the time
specified herein, the Option shall terminate.
<PAGE>

              (ii)    In the event of termination of an Optionee's Continuous
Status as an Employee or Consultant as a result of a disability which does not
fall within the meaning of total and permanent disability (as set forth in
Section 22(e)(3) of the Code), such Optionee may, but only within six months
from the date of such termination (but in no event later than the expiration
date of the term of such Option as set forth in the Option Agreement), exercise
the Option to the extent otherwise entitled to exercise it at the date of such
termination. However, to the extent that such Optionee fails to exercise an
option which is an Incentive Stock Option ("ISO") (within the meaning of Section
                                            ---
422 of the Code) within three months of the date of such termination, the Option
will not qualify for ISO treatment under the Code. To the extent that the
Optionee was not entitled to exercise the option at the date of termination, or
if the Optionee does not exercise such option to the extent so entitled within
six months from the date of termination, the Option shall terminate.

          (d) Death of Optionee. In the event of the death of an Optionee during
              -----------------
the period of Continuous Status as an Employee or Consultant since the date of
grant of the Option, or within 30 days following termination of the Optionee's
Continuous Status as an Employee or Consultant, the Option may be exercised, at
any time within months following the date of death (but in no event later than
the expiration date of the term of such Option as set forth in the Option
Agreement), by such Optionee's estate or by a person who acquired the right to
exercise the Option by bequest or inheritance, but only to the extent of the
right to exercise that had accrued at the date of death or, if earlier, the date
of termination of the Optionee's Continuous Status as an Employee or Consultant.
To the extent that the Optionee was not entitled to exercise the Option at the
date of death or termination, as the case may be, or if the Optionee does not
exercise such Option to the extent so entitled within the time specified herein,
the option shall terminate.

          (e) Rule 16b-3. Options granted to Reporting Persons shall comply with
              ----------
Rule 16b-3 and shall contain such additional conditions or restrictions as may
be required thereunder to qualify for the maximum exemption for Plan
transactions.

     10.  Stock Purchase Rights.
          ---------------------

          (a) Rights to Purchase. Stock Purchase Rights may be issued either
              ------------------
alone, in addition to, or in tandem with other awards granted under the Plan
and/or cash awards made outside of the Plan. After the Administrator determines
that it will offer Stock Purchase Rights under the Plan, it shall advise the
offeree in writing of the terms, conditions and restrictions related to the
offer, including the number of Shares that such person shall be entitled to
purchase, the price to be paid (which price shall not be less than 85% of the
Fair Market Value of the Shares as of the date of the offer, or, in the case of
a person owning stock representing more than 10% of the total combined voting
power of all classes of stock of the Company or any Parent or Subsidiary, the
price shall not be less than 100% of the Fair Market Value of the Shares as of
the date of the offer), and the time within which such person must accept such
offer, which shall in no event exceed 30 days from the date upon which the
Administrator made the determination to grant the Stock Purchase Right. The
offer shall be accepted by execution of a Restricted Stock Purchase Agreement in
the form determined by the Administrator.
<PAGE>

          (b) Repurchase Option. Unless the Administrator determines otherwise,
              -----------------
the Restricted Stock Purchase Agreement shall grant the Company a repurchase
option exercisable upon the voluntary or involuntary termination of the
purchaser's employment with the Company for any reason (including death or
disability). The purchase price for Shares repurchased pursuant to the
Restricted Stock Purchase Agreement shall be the original purchase price paid by
the purchaser and may be paid by cancellation of any indebtedness of the
purchaser to the Company. The repurchase option shall lapse at such rate as the
Administrator may determine; provided, however, that with respect to an Optionee
who is not an officer, director or Consultant of the Company or of any Parent or
Subsidiary of the Company, it shall lapse at a minimum rate of 20% per year.

          (c) Other Provisions. The Restricted Stock Purchase Agreement shall
              ----------------
contain such other terms, provisions and conditions not inconsistent with the
Plan as may be determined by the Administrator in its sole discretion. In
addition, the provisions of Restricted Stock Purchase Agreements need not be the
same with respect to each purchaser.

          (d) Rights as a Stockholder. Once the Stock Purchase Right is
              -----------------------
exercised, the purchaser shall have the rights equivalent to those of a
stockholder, and shall be a stockholder when his or her purchase is entered upon
the records of the duly authorized transfer agent of the Company. No adjustment
will be made for a dividend or other right for which the record date is prior to
the date the Stock Purchase Right is exercised, except as provided in Section 12
of the Plan.

     11.  Stock Withholding to Satisfy Withholding Tax Obligations. At the
          --------------------------------------------------------
discretion of the Administrator, Optionees may satisfy withholding obligations
as provided in this paragraph. When an Optionee incurs tax liability in
connection with an Option or Stock Purchase Right, which tax liability is
subject to tax withholding under applicable tax laws, and the Optionee is
obligated to pay the Company an amount required to be withheld under applicable
tax laws, the Optionee may satisfy the withholding tax obligation by one or some
combination of the following methods: (a) by cash or check payment, or (b) out
of the Optionee's current compensation, (c) if permitted by the Administrator,
in its discretion, by surrendering to the Company Shares that (i) in the case of
Shares previously acquired from the Company, have been owned by the Optionee for
more than six months on the date of surrender, and (ii) have a fair market value
on the date of surrender equal to or less than the Optionee's marginal tax rate
times the ordinary income recognized, or (d) by electing to have the Company
withhold from the Shares to be issued upon exercise of the Option, or the Shares
to be issued in connection with the Stock Purchase Right, if any, that number of
Shares having a fair market value equal to the amount required to be withheld.
For this purpose, the fair market value of the Shares to be withheld shall be
determined on the date that the amount of tax to be withheld is to be determined
(the "Tax Date").
      --------

     Any surrender by a Reporting Person of previously owned Shares to satisfy
tax withholding obligations arising upon exercise of this Option must comply
with the applicable provisions of Rule 16b-3.
<PAGE>

     All elections by an Optionee to have Shares withheld to satisfy tax
withholding obligations shall be made in writing in a form acceptable to the
Administrator and shall be subject to the following restrictions:

          (a) the election must be made on or prior to the applicable Tax Date;

          (b) once made, the election shall be irrevocable as to the particular
Shares of the Option or Stock Purchase Right as to which the election is made;
and

          (c) all elections shall be subject to the consent or disapproval of
the Administrator.

     In the event the election to have Shares withheld is made by an Optionee
and the Tax Date is deferred under Section 83 of the Code because no election is
filed under Section 83(b) of the Code, the Optionee shall receive the full
number of Shares with respect to which the Option or Stock Purchase Right is
exercised but such Optionee shall be unconditionally obligated to tender back to
the Company the proper number of Shares on the Tax Date.

     12.  Adjustments Upon Changes in Capitalization, Merger or Certain Other
          -------------------------------------------------------------------
Transactions.
------------

          (a) Changes in Capitalization. Subject to any required action by the
              -------------------------
stockholders of the Company, the number of shares of Common Stock covered by
each outstanding Option or Stock Purchase Right, and the number of shares of
Common Stock that have been authorized for issuance under the Plan but as to
which no Options or Stock Purchase Rights have yet been granted or that have
been returned to the Plan upon cancellation or expiration of an Option or Stock
Purchase Right, as well as the price per share of Common Stock covered by each
such outstanding Option or Stock Purchase Right, shall be proportionately
adjusted for any increase or decrease in the number of issued shares of Common
Stock resulting from a stock split, reverse stock split, stock dividend,
combination, recapitalization or reclassification of the Common Stock, or any
other increase or decrease in the number of issued shares of Common Stock
effected without receipt of consideration by the Company; provided, however,
that conversion of any convertible securities of the Company shall not be deemed
to have been "effected without receipt of consideration." Such adjustment shall
be made by the Board, whose determination in that respect shall be final,
binding and conclusive. Except as expressly provided herein, no issuance by the
Company of shares of stock of any class, or securities convertible into shares
of stock of any class, shall affect, and no adjustment by reason thereof shall
be made with respect to, the number or price of shares of Common Stock subject
to an Option or Stock Purchase Right.

          (b) Dissolution or Liquidation. In the event of the proposed
              --------------------------
dissolution or liquidation of the Company, the Board shall notify the Optionee
at least 15 days prior to such proposed action. To the extent it has not been
previously exercised, the Option or Stock Purchase Right will terminate
immediately prior to the consummation of such proposed action.
<PAGE>

          (c) Merger or Sale of Assets. In the event of a proposed sale of all
              ------------------------
or substantially all of the Company's assets or a merger of the Company with or
into another corporation where the successor corporation issues its securities
to the Company's stockholders, each outstanding Option or Stock Purchase Right
shall be assumed or an equivalent option or right shall be substituted by such
successor corporation or a parent or subsidiary of such successor corporation,
unless the successor corporation does not agree to assume the Option or Stock
Purchase Right or to substitute an equivalent option or right, in which case
such Option or Stock Purchase Right shall terminate upon the consummation of the
merger or sale of assets. For purposes of this Section 12(c), an Option or a
Stock Purchase Right shall be considered assumed, without limitation, if, at the
time of issuance of the stock or other consideration upon such merger or sale of
assets, each holder of an Option or a Stock Purchase Right would be entitled to
receive upon exercise of the Option or Stock Purchase Right the same number and
kind of shares of stock or the same amount of property, cash or securities as
such holder would have been entitled to receive upon the occurrence of such
transaction if the holder had been, immediately prior to such transaction, the
holder of the number of Shares of Common Stock covered by the Option or the
Stock Purchase Right at such time (after giving effect to any adjustments in the
number of Shares covered by the Option or Stock Purchase Right as provided for
in this Section 12).

          (d) Certain Distributions. In the event of any distribution to the
              ---------------------
Company's stockholders of securities of any other entity or other assets (other
than dividends payable in cash or stock of the Company) without receipt of
consideration by the Company, the Administrator may, in its discretion,
appropriately adjust the price per share of Common Stock covered by each
outstanding Option or Stock Purchase Right to reflect the effect of such
distribution.

     13.  Non-Transferability of Options and Stock Purchase Right. Options and
          -------------------------------------------------------
Stock Purchase Rights may not be sold, pledged, assigned, hypothecated,
transferred, or disposed of in any manner other than by will or by the laws of
descent or distribution and may be exercised or purchased during the lifetime of
the Optionee or Stock Purchase Rights Holder only by the Optionee or Stock
Purchase Rights Holder.

     14.  Time of Granting Options and Stock Purchase Rights. The date of grant
          --------------------------------------------------
of an Option or Stock Purchase Right shall, for all purposes, be the date on
which the Administrator makes the determination granting such Option or Stock
Purchase Right, or such other date as is determined by the Board; provided,
however, that in the case of any Incentive Stock option, the grant date shall be
the later of the date on which the Administrator makes the determination
granting such Incentive Stock Option or the date of commencement of the
Optionee's employment relationship with the Company. Notice of the determination
shall be given to each Employee or Consultant to whom an Option or Stock
Purchase Right is so granted within a reasonable time after the date of such
grant.

     15.  Amendment and Termination of the Plan,
          --------------------------------------

          (a) Authority to Amend or Terminate. The Board may at any time amend,
              -------------------------------
alter, suspend or discontinue the Plan, but no amendment, alteration, suspension
or
<PAGE>

discontinuation shall be made that would impair the rights of any Optionee under
any grant theretofore made, without his or her consent. In addition, to the
extent necessary and desirable to comply with Rule 16b-3 or with Section 422 of
the Code (or any other applicable law or regulation, including the requirements
of any Stock Exchange), the Company shall obtain stockholder approval of any
Plan amendment in such a manner and to such a degree as required.

          (b) Effect of Amendment or Termination. No amendment or termination of
              ----------------------------------
the Plan shall adversely affect Options already granted, unless mutually agreed
otherwise between the Optionee and the Board, which agreement must be in writing
and signed by the Optionee and the Company.

     16.  Conditions Upon Issuance of Shares. Shares shall not be issued
          ----------------------------------
pursuant to the exercise of an Option or Stock Purchase Right unless the
exercise of such Option or Stock Purchase Right and the issuance and delivery of
such Shares pursuant thereto shall comply with all relevant provisions of law,
including, without limitation, the Securities Act of 1933, as amended, the
Exchange Act, the rules and regulations promulgated thereunder, and the
requirements of any Stock Exchange.

     As a condition to the exercise of an option, the Company may require the
person exercising such option to represent and warrant at the time of any such
exercise that the Shares are being purchased only for investment and without any
present intention to sell or distribute such Shares if, in the opinion of
counsel for the Company, such a representation is required by law.

     17.  Reservation of Shares. The Company, during the term of this Plan, will
          ---------------------
at all times reserve and keep available such number of Shares as shall be
sufficient to satisfy the requirements of the Plan. The inability of the Company
to obtain authority from any regulatory body having jurisdiction, which
authority is deemed by the Company's counsel to be necessary to the lawful
issuance and sale of any Shares hereunder, shall relieve the Company of any
liability in respect of the failure to issue or sell such Shares as to which
such requisite authority shall not have been obtained.

     18.  Agreements. Options and Stock Purchase Rights shall be evidenced by
          ----------
written Option Agreements and Restricted Stock Purchase Agreements,
respectively, in such form(s) as the Administrator shall approve from time to
time.

     19.  Stockholder Approval. Continuance of the Plan shall be subject to
          --------------------
approval by the stockholders of the Company within twelve months before or after
the date the Plan is adopted. Such stockholder approval shall be obtained in the
degree and manner required under applicable state and federal law and the rules
of any Stock Exchange upon which the Common Stock is listed. All options and
Stock Purchase Rights issued under the Plan shall become void in the event such
approval is not obtained.

     20.  Information and Documents to Optionees and Purchasers. The Company
          -----------------------------------------------------
shall provide financial statements at least annually to each Optionee and to
each individual who acquired Shares Pursuant to the Plan, during the period such
Optionee or purchaser has one or
<PAGE>

more Options or Stock Purchase Rights outstanding, and in the case of an
individual who acquired Shares pursuant to the Plan, during the period such
individual owns such Shares. The Company shall not be required to provide such
information if the issuance of Options or Stock Purchase Rights under the Plan
is limited to key employees whose duties in connection with the Company assure
their access to equivalent information. In addition, at the time of issuance of
any securities under the Plan, the Company shall provide to the Optionee or the
Purchaser a copy of the Plan and any agreement(s) pursuant to which securities
granted under the Plan are issued.
<PAGE>

                                 SIGNIO, INC.

                                1998 STOCK PLAN

                         NOTICE OF STOCK OPTION GRANT
                         ----------------------------

((Optionee))
c/o Signio, Inc.
5199 Johnson Drive
Pleasanton, CA 94588

     You have been granted an option to purchase Common Stock ("Common Stock")
                                                                ------------
of SIGNIO, INC. (the "Company") as follows:
                      -------

<TABLE>
<CAPTION>
<S>                                         <C>

  Board Approval Date:                      ((GrantDate))

  Date of Grant (Later of Board
       Approval Date or
       Commencement of
       Employment/Consulting):              ((GrantDate))

  Vesting Commencement Date:                ((VestingDate))

  Exercise Price Per Share:                 ((Price))

  Total Number of Shares Granted:           ((Shares))

  Total Exercise Price:                     ((TotalPrice))

  Type of Option:                                 X           Incentive Stock Option ("ISO")
                                            -------------                             -----
                                                              Nonstatutory Stock Option ("NSO")
                                            -------------                                -----

  Term/Expiration Date:                     ((ExpDate))
</TABLE>

  Vesting Schedule:                         This Option may be exercised, in
                                            whole or in part, in accordance with
                                            the following schedule: Twenty-Five
                                            percent (25%) of the Shares subject
                                            to the Option shall vest on the
                                            twelve (12) month anniversary of the
                                            Vesting Commencement Date and 1/48
                                            of the total number of Shares
                                            subject to the Option shall vest
                                            each month thereafter.
<PAGE>

     Termination Period:                    This Option may be exercised for 90
                                            days after termination of employment
                                            or consulting relationship except as
                                            set out in Sections 6 and 7 of the
                                            Stock Option Agreement (but in no
                                            event later than the Expiration
                                            Date).

     By your signature and the signature of the Company's representative below,
you and the Company agree that this option is granted under and governed by the
terms and conditions of the 1998 Stock Plan and the Stock Option Agreement, both
of which are attached and made a part of this document.

((Optionee)):                      SIGNIO, INC.:

_____________________________      By:_____________________________
Signature

_____________________________      ________________________________
Print Name                         Print Name and Title

                                      -2-
<PAGE>

                                 SIGNIO, INC.

                                1998 STOCK PLAN

                            STOCK OPTION AGREEMENT
                            ----------------------

     1.  Grant of Option.  SIGNIO, INC., a California corporation (the
         ---------------
"Company"), hereby grants to ((Optionee)) ("Optionee") an option (the "Option")
 -------                                  --------                   ------
to purchase a total number of shares of Common Stock (the "Shares") set forth in
                                                        -----
the Notice of Stock Option Grant, at the exercise price per share set forth in
the Notice of Stock Option Grant (the "Exercise Price") subject to the terms,
                                       --------------
definitions and provisions of the SIGNIO, INC. 1998 Stock Plan (the "Plan")
                                                                     ----
adopted by the Company, which is incorporated herein by reference.  Unless
otherwise defined herein, the terms defined in the Plan shall have the same
defined meanings in this Option.

     If designated an Incentive Stock Option, this Option is intended to qualify
as an Incentive Stock Option as defined in Section 422 of the Code.

     2.  Exercise of Option.  This Option shall be exercisable during its Term
         ------------------
in accordance with the Vesting Schedule set out in the Notice of Stock Option
Grant and with the provisions of Section 9 of the Plan as follows:

          (a)  Right to Exercise.
               -----------------

               (i)   This Option may be exercised in whole or in part at any
time after the Date of Grant, as to Shares which have not yet vested under the
vesting schedule indicated on the Notice of Stock Option Grant; provided,
                                                                --------
however, that Optionee shall execute as a condition to such exercise of this
-------
Option, the Early Exercise Notice and Restricted Stock Purchase Agreement
attached hereto as Exhibit A (the "Early Exercise Agreement"). If Optionee
                   ---------       ------------------------
chooses to exercise this Option solely as to Shares which have vested under the
vesting schedule indicated on the Notice of Stock Option Grant, Optionee shall
complete and execute the form of Exercise Notice and Restricted Stock Purchase
Agreement attached hereto as Exhibit B (the "Exercise Agreement").
                             ---------       ------------------
Notwithstanding the foregoing, the Company may in its discretion prescribe or
accept a different form of notice of exercise and/or stock purchase agreement if
such forms are otherwise consistent with this Agreement, the Plan and then-
applicable law.

               (ii)  This Option may not be exercised for a fraction of a share.

               (iii) In the event of Optionee's death, disability or other
termination of employment or consulting relationship, the exercisability of the
Option is governed by Sections 5, 6 and 7 below, subject to the limitation
contained in Section 2(a)(iv) below.

               (iv)  In no event may this Option be exercised after the
Expiration Date of this Option as set forth in the Notice of Stock Option Grant.

          (b)  Method of Exercise.  This Option shall be exercisable by
               ------------------
execution and delivery of the Early Exercise Agreement or the Exercise
Agreement, whichever is applicable, or
<PAGE>

of any other written notice approved for such purpose by the Company which shall
state the election to exercise the Option, the number of Shares in respect of
which the Option is being exercised, and such other representations and
agreements as to the holder's investment intent with respect to such shares of
Common Stock as may be required by the Company pursuant to the provisions of the
Plan. Such written notice shall be signed by Optionee and shall be delivered in
person or by certified mail to the Secretary of the Company. The written notice
shall be accompanied by payment of the Exercise Price. This Option shall be
deemed to be exercised upon receipt by the Company of such written notice
accompanied by the Exercise Price.

     No Shares will be issued pursuant to the exercise of an Option unless such
issuance and such exercise shall comply with all relevant provisions of
applicable law, including the requirements of any stock exchange upon which the
Shares may then be listed.  Assuming such compliance, for income tax purposes
the Shares shall be considered transferred to Optionee on the date on which the
Option is exercised with respect to such Shares.

     3.  Method of Payment.  Payment of the Exercise Price shall be by any of
         -----------------
the following, or a combination thereof:

          (a)  at the election of Optionee:

               (i)   cash;

               (ii)  check; or

               (iii) if there is a public market for the Shares and they are
registered under the Securities Exchange Act of 1934, as amended (the "Exchange
                                                                       --------
Act"), delivery of a properly executed exercise notice together with irrevocable
---
instructions to a broker to deliver promptly to the Company the amount of sale
or loan proceeds required to pay the Exercise Price;

          (b)  at the election of Optionee, and subject to approval of the
Administrator:

               (i)   surrender of other shares of Common Stock of the Company
which (i) in the case of Shares acquired pursuant to the exercise of a Company
option, have been owned by Optionee for more than 6 months on the date of
surrender, and (ii) have a Fair Market Value on the date of surrender equal to
the Exercise Price of the Shares as to which the Option is being exercised; or

               (ii)  subject to Section 408(a) of the California Corporations
Code, a promissory note in the form attached to this Agreement as Exhibit C, or
                                                                  ---------
in any other form approved by the Company.

     4.  Restrictions on Exercise.  This Option may not be exercised until such
         ------------------------
time as the Plan has been approved by the shareholders of the Company, or if the
issuance of such Shares upon such exercise or the method of payment of
consideration for such shares would constitute a violation of any applicable
federal or state securities or other law or regulation, including any rule under
Part 207 of Title 12 of the Code of Federal Regulations as promulgated by the
Federal Reserve Board.  As a condition to the exercise of this Option, the
Company may

                                      -2-
<PAGE>

require Optionee to make any representation and warranty to the Company as may
be required by any applicable law or regulation.

     5.   Termination of Relationship.  In the event of termination of
          ---------------------------
Optionee's Continuous Status as an Employee or Consultant, Optionee may, to the
extent otherwise so entitled at the date of such termination (the "Termination
                                                                   -----------
Date"), exercise this Option during the Termination Period set forth in the
----
Notice of Stock Option Grant. To the extent that Optionee was not entitled to
exercise this Option at such Termination Date, or if Optionee does not exercise
this Option within the Termination Period, the Option shall terminate.

     6.   Disability of Optionee.
          ----------------------

          (a) Notwithstanding the provisions of Section 5 above, in the event of
termination of Optionee's Continuous Status as an Employee or Consultant as a
result of his or her total and permanent disability (as defined in Section
22(e)(3) of the Code), Optionee may, but only within twelve months from the
Termination Date (but in no event later than the Expiration Date set forth in
the Notice of Stock Option Grant and in Section 9 below), exercise this Option
to the extent he or she was entitled to exercise it at such Termination Date.
To the extent that Optionee was not entitled to exercise the Option Termination
Date, or if Optionee does not exercise such Option to the extent so entitled
within the time specified in this Section 6(a), the Option shall terminate.

          (b) Notwithstanding the provisions of Section 5 above, in the event of
termination of Optionee's consulting relationship or Continuous Status as an
Employee as a result of a disability not constituting a total and permanent
disability (as set forth in Section 22(e)(3) of the Code), Optionee may, but
only within six months from the Termination Date (but in no event later than the
Expiration Date set forth in the Notice of Stock Option Grant and in Section 9
below), exercise the Option to the extent Optionee was entitled to exercise it
as of such Termination Date; provided, however, that if this is an Incentive
Stock Option and Optionee fails to exercise this Incentive Stock Option within
three months from the Termination Date, this Option will cease to qualify as an
Incentive Stock Option (as defined in Section 422 of the Code) and Optionee will
be treated for federal income tax purposes as having received ordinary income at
the time of such exercise in an amount generally measured by the difference
between the Exercise Price for the Shares and the Fair Market Value of the
Shares on the date of exercise.  To the extent that Optionee was not entitled to
exercise the Option at the Termination Date, or if Optionee does not exercise
such Option to the extent so entitled within the time specified in this Section
6(b), the Option shall terminate.

     7.   Death of Optionee.  In the event of the death of Optionee (a) during
          -----------------
the Term of this Option and while an Employee or Consultant of the Company and
having been in Continuous Status as an Employee or Consultant since the date of
grant of the Option, or (b) within 30 days after Optionee's Termination Date,
the Option may be exercised at any time within six months following the date of
death (but in no event later than the Expiration Date set forth in the Notice of
Stock Option Grant and in Section 9 below), by Optionee's estate or by a person
who acquired the right to exercise the Option by bequest or inheritance, but
only to the extent of the right to exercise that had accrued at the Termination
Date.

                                      -3-
<PAGE>

     8.   Non-Transferability of Option.  This Option may not be transferred in
          -----------------------------
any manner otherwise than by will or by the laws of descent or distribution and
may be exercised during the lifetime of Optionee only by him or her.  The terms
of this Option shall be binding upon the executors, administrators, heirs,
successors and assigns of Optionee.

     9.   Term of Option.  This Option may be exercised only within the Term set
          --------------
forth in the Notice of Stock Option Grant, subject to the limitations set forth
in Section 7 of the Plan.

     10.  Tax Consequences.  Set forth below is a brief summary as of the date
          ----------------
of this Option of certain of the federal and California tax consequences of
exercise of this Option and disposition of the Shares under the laws in effect
as of the Date of Grant.  THIS SUMMARY IS NECESSARILY INCOMPLETE, AND THE TAX
LAWS AND REGULATIONS ARE SUBJECT TO CHANGE.  OPTIONEE SHOULD CONSULT A TAX
ADVISER BEFORE EXERCISING THIS OPTION OR DISPOSING OF THE SHARES.

          (a) Exercise of Incentive Stock Option.  If this Option qualifies as
              ----------------------------------
an Incentive Stock Option, there will be no regular federal or California income
tax liability upon the exercise of the Option, although the excess, if any, of
the Fair Market Value of the Shares on the date of exercise over the Exercise
Price will be treated as an adjustment to the alternative minimum tax for
federal tax purposes and may subject Optionee to the alternative minimum tax in
the year of exercise.

          (b) Exercise of Nonstatutory Stock Option.  If this Option does not
              -------------------------------------
qualify as an Incentive Stock Option, there may be a regular federal income tax
liability and a California income tax liability upon the exercise of the Option.
Optionee will be treated as having received compensation income (taxable at
ordinary income tax rates) equal to the excess, if any, of the fair market value
of the Shares on the date of exercise over the Exercise Price.  If Optionee is
an employee, the Company will be required to withhold from Optionee's
compensation or collect from Optionee and pay to the applicable taxing
authorities an amount equal to a percentage of this compensation income at the
time of exercise.

          (c) Disposition of Shares.  In the case of a Nonstatutory Stock
              ---------------------
Option, if Shares are held for at least one year, any gain realized on
disposition of the Shares will be treated as long-term capital gain for federal
and California income tax purposes.  In the case of an Incentive Stock Option,
if Shares transferred pursuant to the Option are held for at least one year
after exercise and are disposed of at least two years after the Date of Grant,
any gain realized on disposition of the Shares will also be treated as long-term
capital gain for federal and California income tax purposes.  In either case,
the long-term capital gain will be taxed for federal income tax and alternative
minimum tax purposes at a maximum rate of 28% if the Shares are held more than
one year but less than 18 months after exercise and at 20% if the Shares are
held more than 18 months after exercise.  If Shares purchased under an Incentive
Stock Option are disposed of within one year after exercise or within two years
after the Date of Grant, any gain realized on such disposition will be treated
as compensation income (taxable at ordinary income rates) to the extent of the
difference between the Exercise Price and the lesser of (i) the fair market
value of the Shares on the date of exercise, or (ii) the sale price of the
Shares.

                                      -4-
<PAGE>

          (d) Notice of Disqualifying Disposition of Incentive Stock Option
              -------------------------------------------------------------
Shares.  If the Option granted to Optionee herein is an Incentive Stock Option,
------
and if Optionee sells or otherwise disposes of any of the Shares acquired
pursuant to the Incentive Stock Option on or before the later of (i) the date
two years after the Date of Grant, or (ii) the date one year after the date of
exercise, Optionee shall immediately notify the Company in writing of such
disposition.  Optionee acknowledges and agrees that he or she may be subject to
income tax withholding by the Company on the compensation income recognized by
Optionee from the early disposition by payment in cash or out of the current
earnings paid to Optionee.

     11.  Withholding Tax Obligations.  Optionee understands that, upon
          ---------------------------
exercising a Nonstatutory Stock Option, he or she will recognize income for tax
purposes in an amount equal to the excess of the then Fair Market Value of the
Shares over the Exercise Price.  However, the timing of this income recognition
may be deferred for up to six months if Optionee is subject to Section 16 of the
Exchange Act.  If Optionee is an employee, the Company will be required to
withhold from Optionee's compensation, or collect from Optionee and pay to the
applicable taxing authorities an amount equal to a percentage of this
compensation income.  Additionally, Optionee may at some point be required to
satisfy tax withholding obligations with respect to the disqualifying
disposition of an Incentive Stock Option.  Optionee shall satisfy his or her tax
withholding obligation arising upon the exercise of this Option by one or some
combination of the following methods: (a) by cash payment, (b) out of Optionee's
current compensation, (c) if permitted by the Administrator, in its discretion,
by surrendering to the Company Shares which (i) in the case of Shares previously
acquired from the Company, have been owned by Optionee for more than six months
on the date of surrender, and (ii) have a Fair Market Value on the date of
surrender equal to or greater than Optionee's marginal tax rate times the
ordinary income recognized, or (d) by electing to have the Company withhold from
the Shares to be issued upon exercise of the Option that number of Shares having
a Fair Market Value equal to the amount required to be withheld.  For this
purpose, the Fair Market Value of the Shares to be withheld shall be determined
on the date that the amount of tax to be withheld is to be determined (the "Tax
                                                                            ---
Date").
----

     If Optionee is subject to Section 16 of the Exchange Act (an "Insider"),
                                                                   -------
any surrender of previously owned Shares to satisfy tax withholding obligations
arising upon exercise of this Option must comply with the applicable provisions
of Rule 16b-3 promulgated under the Exchange Act ("Rule 16b-3").
                                                   ----------

     All elections by Optionee to have Shares withheld to satisfy tax
withholding obligations shall be made in writing in a form acceptable to the
Administrator and shall be subject to the following restrictions:

          (a) the election must be made on or prior to the applicable Tax Date;

          (b) once made, the election shall be irrevocable as to the particular
Shares of the Option as to which the election is made; and

          (c) all elections shall be subject to the consent or disapproval of
the Administrator.

                                      -5-
<PAGE>

     12.  Market Standoff Agreement.  In connection with the initial public
          -------------------------
offering of the Company's securities and upon request of the Company or the
underwriters managing such underwritten offering of the Company's securities,
Optionee hereby agrees not to sell, make any short sale of, loan, grant any
option for the purchase of, or otherwise dispose of any Shares (other than those
included in the registration) without the prior written consent of the Company
or such underwriters, as the case may be, for such period of time (not to exceed
180 days) from the effective date of such registration as may be requested by
the Company or such managing underwriters and to execute an agreement reflecting
the foregoing as may be requested by the underwriters at the time of the
Company's initial public offering.

                            [Signature Page Follows]

                                      -6-
<PAGE>

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

                              SIGNIO, INC.

                              By:__________________________________

                              Name:________________________________
                                   (print)

                              Title:_______________________________

     OPTIONEE ACKNOWLEDGES AND AGREES THAT THE VESTING OF SHARES PURSUANT TO THE
OPTION HEREOF IS EARNED ONLY BY CONTINUING CONSULTANCY OR EMPLOYMENT AT THE WILL
OF THE COMPANY (NOT THROUGH THE ACT OF BEING HIRED, BEING GRANTED THIS OPTION OR
ACQUIRING SHARES HEREUNDER).  OPTIONEE FURTHER ACKNOWLEDGES AND AGREES THAT
NOTHING IN THIS AGREEMENT, NOR IN THE COMPANY'S STOCK PLAN WHICH IS INCORPORATED
HEREIN BY REFERENCE, SHALL CONFER UPON OPTIONEE ANY RIGHT WITH RESPECT TO
CONTINUATION OF EMPLOYMENT OR CONSULTANCY BY THE COMPANY, NOR SHALL IT INTERFERE
IN ANY WAY WITH OPTIONEE'S RIGHT OR THE COMPANY'S RIGHT TO TERMINATE OPTIONEE'S
EMPLOYMENT OR CONSULTANCY AT ANY TIME, WITH OR WITHOUT CAUSE.

     Optionee acknowledges receipt of a copy of the Plan and represents that he
or she is familiar with the terms and provisions thereof, and hereby accepts
this Option subject to all of the terms and provisions thereof.  Optionee has
reviewed the Plan and this Option in their entirety, has had an opportunity to
obtain the advice of counsel prior to executing this Option and fully
understands all provisions of the Option.  Optionee hereby agrees to accept as
binding, conclusive and final all decisions or interpretations of the
Administrator upon any questions arising under the Plan or this Option.

Dated: ____________________   ______________________________
                              ((Optionee))

                                      -7-
<PAGE>

                                   EXHIBIT A
                                   ---------

                                 SIGNIO, INC.

                                1998 STOCK PLAN

         EARLY EXERCISE NOTICE AND RESTRICTED STOCK PURCHASE AGREEMENT
         -------------------------------------------------------------

     This Agreement ("Agreement") is made as of ______________, by and between
                      ---------
SIGNIO, INC., a California corporation (the "Company"), and
                                             -------
_______________________________ ("Purchaser").  To the extent any capitalized
                                  ---------
terms used in this Agreement are not defined, they shall have the meaning
ascribed to them in the 1998 Stock Plan.

     1.  Exercise of Option.  Subject to the terms and conditions hereof,
         ------------------
Purchaser hereby elects to exercise his or her option to purchase _____________
shares of the Common Stock (the "Shares") of the Company under and pursuant
                                 ------
to the Company's 1998 Stock Plan (the "Plan") and the Stock Option Agreement
                                       ----
dated ______________ (the "Option Agreement").  Of these Shares, Purchaser
                           ----------------
has elected to purchase _______________ of those Shares which have become
vested as of the date hereof under the Vesting Schedule set forth in
the Notice of Stock Option Grant (the "Vested Shares") and _____________ Shares
                                       -------------
which have not yet vested under such Vesting Schedule (the "Unvested Shares").
                                                            ---------------
The purchase price for the Shares shall be $________ per Share for a total
purchase price of $_______________.  The term "Shares" refers to the purchased
                                               ------
Shares and all securities received in replacement of the Shares or as stock
dividends or splits, all securities received in replacement of the Shares in a
recapitalization, merger, reorganization, exchange or the like, and all new,
substituted or additional securities or other properties to which Purchaser is
entitled by reason of Purchaser's ownership of the Shares.

     2.  Time and Place of Exercise.  The purchase and sale of the Shares under
         --------------------------
this Agreement shall occur at the principal office of the Company simultaneously
with the execution and delivery of this Agreement in accordance with the
provisions of Section 2(b) of the Option Agreement. On such date, the Company
will deliver to Purchaser a certificate representing the Shares to be purchased
by Purchaser (which shall be issued in Purchaser's name) against payment of the
purchase price therefor by Purchaser by (a) check made payable to the Company,
(b) cancellation of indebtedness of the Company to Purchaser, (c) delivery of
shares of the Common Stock of the Company in accordance with Section 3 of the
Option Agreement, (d) at the discretion of the Administrator and subject to
Section 153 of the Delaware General Corporation Law, delivery of a promissory
note in the form attached as Exhibit C to the Option Agreement (or in any form
                             ---------
acceptable to the Company), or (e) a combination of the foregoing. If Purchaser
delivers a promissory note as partial or full payment of the purchase price,
Purchaser will also deliver a Pledge and Security Agreement in the form attached
to Exhibit D to the Option Agreement (or in any form acceptable to the Company).
   ---------

     3.  Limitations on Transfer.  In addition to any other limitation on
         -----------------------
transfer created by applicable securities laws, Purchaser shall not assign,
encumber or dispose of any interest in the Shares while the Shares are subject
to the Company's Repurchase Option (as defined below), except as provided below.
After any Shares have been released from such Repurchase Option,
<PAGE>

Purchaser shall not assign, encumber or dispose of any interest in such Shares
except in compliance with the provisions below and applicable securities laws.

          (a)  Repurchase Option.
               -----------------

               (i)   In the event of the voluntary or involuntary termination of
Purchaser's employment or consulting relationship with the Company for any
reason (including death or disability), with or without cause, the Company shall
upon the date of such termination (the "Termination Date") have an irrevocable,
                                        ----------------
exclusive option (the "Repurchase Option") for a period of 60 days from such
                       -----------------
date to repurchase all or any portion of the Unvested Shares held by Purchaser
as of the Termination Date which have not yet been released from the Company's
Repurchase Option at the original purchase price per Share specified in Section
1 (adjusted for any stock splits, stock dividends and the like).

               (ii)  The Repurchase Option shall be exercised by the Company by
written notice to Purchaser or Purchaser's executor and, at the Company's
option, (A) by delivery to Purchaser or Purchaser's executor with such notice of
a check in the amount of the purchase price for the Shares being purchased, or
(B) in the event Purchaser is indebted to the Company, by cancellation by the
Company of an amount of such indebtedness equal to the purchase price for the
Shares being repurchased, or (C) by a combination of (A) and (B) so that the
combined payment and cancellation of indebtedness equals such purchase price.
Upon delivery of such notice and payment of the purchase price in any of the
ways described above, the Company shall become the legal and beneficial owner of
the Shares being repurchased and all rights and interest therein or related
thereto, and the Company shall have the right to transfer to its own name the
number of Shares being repurchased by the Company, without further action by
Purchaser.

               (iii) One hundred percent (100%) of the Unvested Shares shall
initially be subject to the Repurchase Option. The Unvested Shares shall be
released from the Repurchase Option in accordance with the Vesting Schedule set
forth in the Notice of Stock Option Grant until all Shares are released from the
Repurchase Option.  Fractional shares shall be rounded to the nearest whole
share.

               (iv)  In the event of a proposed sale of all or substantially all
of the Company's assets or a merger of the Company with or into another
corporation, the Repurchase Option shall terminate automatically and the Shares
subject to those terminated rights shall immediately vest in full, except to the
extent the Agreement is assumed by the successor corporation or a parent or
subsidiary of such successor corporation in which case the Repurchase Option
shall continue to lapse in accordance with the Vesting Schedule set forth in the
Notice of Stock Option Grant.

          (b)  Right of First Refusal.  Before any Shares held by Purchaser or
               ----------------------
any transferee of Purchaser (either being sometimes referred to herein as the
"Holder") may be sold or otherwise transferred (including transfer by gift or
 ------
operation of law), the Company or its assignee(s) shall have a right of first
refusal to purchase the Shares on the terms and conditions set forth in this
Section 3(b) (the "Right of First Refusal").
                   ----------------------

                                      -2-
<PAGE>

               (i)   Notice of Proposed Transfer.  The Holder of the Shares
                     ---------------------------
shall deliver to the Company a written notice (the "Notice") stating:  (i) the
                                                    ------
Holder's bona fide intention to sell or otherwise transfer such Shares; (ii) the
name of each proposed purchaser or other transferee ("Proposed Transferee");
                                                      -------------------
(iii) the number of Shares to be transferred to each Proposed Transferee; and
(iv) the terms and conditions of each proposed sale or transfer. The Holder
shall offer the Shares at the same price (the "Offered Price") and upon the
                                               -------------
same terms (or terms as similar as reasonably possible) to the Company or its
assignee(s).

               (ii)  Exercise of Right of First Refusal.  At any time within
                     ----------------------------------
30 days after receipt of the Notice, the Company and/or its assignee(s) may, by
giving written notice to the Holder, elect to purchase all, but not less than
all, of the Shares proposed to be transferred to any one or more of the Proposed
Transferees, at the purchase price determined in accordance with subsection
(iii) below.

               (iii) Purchase Price.  The purchase price ("Purchase Price")
                     --------------                        --------------
for the Shares purchased by the Company or its assignee(s) under this Section
3(b) shall be the Offered Price. If the Offered Price includes consideration
other than cash, the cash equivalent value of the non-cash consideration shall
be determined by the Board of Directors of the Company in good faith.

               (iv)  Payment.  Payment of the Purchase Price shall be made, at
                     -------
the option of the Company or its assignee(s), in cash (by check), by
cancellation of all or a portion of any outstanding indebtedness of the Holder
to the Company (or, in the case of repurchase by an assignee, to the assignee),
or by any combination thereof within 30 days after receipt of the Notice or in
the manner and at the times set forth in the Notice.

               (v) Holder's Right to Transfer.  If all of the Shares proposed
                   --------------------------
in the Notice to be transferred to a given Proposed Transferee are not purchased
by the Company and/or its assignee(s) as provided in this Section 3(b), then the
Holder may sell or otherwise transfer such Shares to that Proposed Transferee at
the Offered Price or at a higher price, provided that such sale or other
transfer is consummated within 60 days after the date of the Notice and provided
further that any such sale or other transfer is effected in accordance with any
applicable securities laws and the Proposed Transferee agrees in writing that
the provisions of this Section 3 shall continue to apply to the Shares in the
hands of such Proposed Transferee. If the Shares described in the Notice are not
transferred to the Proposed Transferee within such period, or if the Holder
proposes to change the price or other terms to make them more favorable to the
Proposed Transferee, a new Notice shall be given to the Company, and the Company
and/or its assignees shall again be offered the Right of First Refusal before
any Shares held by the Holder may be sold or otherwise transferred.

               (vi)  Exception for Certain Family Transfers.  Anything to the
                     --------------------------------------
contrary contained in this Section 3(b) notwithstanding, the transfer of any or
all of the Shares during Purchaser's lifetime or on Purchaser's death by will or
intestacy to Purchaser's Immediate Family (as defined below) or a trust for the
benefit of Purchaser's Immediate Family shall be exempt from the provisions of
this Section 3(b). "Immediate Family" as used herein shall mean spouse, lineal
                    ----------------
descendant or antecedent, father, mother, brother or sister.  In such case, the
transferee or other recipient shall receive and hold the Shares so transferred
subject to the

                                      -3-
<PAGE>

provisions of this Section, and there shall be no further transfer of such
Shares except in accordance with the terms of this Section 3.

          (c)  Involuntary Transfer.
               --------------------

               (i)   Company's Right to Purchase upon Involuntary Transfer.
                     -----------------------------------------------------
In the event, at any time after the date of this Agreement, of any transfer by
operation of law or other involuntary transfer (including death or divorce, but
excluding a transfer to Immediate Family as set forth in Section 3(b)(vi) above)
of all or a portion of the Shares by the record holder thereof, the Company
shall have an option to purchase all of the Shares transferred at the greater of
the purchase price paid by Purchaser pursuant to this Agreement or the Fair
Market Value of the Shares on the date of transfer. Upon such a transfer, the
person acquiring the Shares shall promptly notify the Secretary of the Company
of such transfer. The right to purchase such Shares shall be provided to the
Company for a period of 30 days following receipt by the Company of written
notice by the person acquiring the Shares.

               (ii) Price for Involuntary Transfer.  With respect to any stock
                    ------------------------------
to be transferred pursuant to Section 3(c)(i), the price per Share shall be a
price set by the Board of Directors of the Company that will reflect the current
value of the stock in terms of present earnings and future prospects of the
Company. The Company shall notify Purchaser or his or her executor of the price
so determined within 30 days after receipt by it of written notice of the
transfer or proposed transfer of Shares. However, if the Purchaser does not
agree with the valuation as determined by the Board of Directors of the Company,
the Purchaser shall be entitled to have the valuation determined by an
independent appraiser to be mutually agreed upon by the Company and the
Purchaser and whose fees shall be borne equally by the Company and the
Purchaser.

          (d) Assignment.  The right of the Company to purchase any part of the
              ----------
Shares may be assigned in whole or in part to any shareholder or shareholders of
the Company or other persons or organizations; provided, however, that an
assignee, other than a corporation that is the Parent or a 100% owned Subsidiary
of the Company, must pay the Company, upon assignment of such right, cash equal
to the difference between the original purchase price and Fair Market Value, if
the original purchase price is less than the Fair Market Value of the Shares
subject to the assignment.

          (e) Restrictions Binding on Transferees.  All transferees of Shares or
              -----------------------------------
any interest therein will receive and hold such Shares or interest subject to
the provisions of this Agreement, including, insofar as applicable, the
Company's option to repurchase under Section 3(a).  Any sale or transfer of the
Company's Shares shall be void unless the provisions of this Agreement are
satisfied.

          (f) Termination of Rights.  The Right of First Refusal granted the
              ---------------------
Company by Section 3(b) above and the option to repurchase the Shares in the
event of an involuntary transfer granted the Company by Section 3(c) above shall
terminate upon the first sale of Common Stock of the Company to the general
public pursuant to a registration statement filed with and declared effective by
the Securities and Exchange Commission under the Securities Act of 1933, as
amended (the "Securities Act").  Upon termination of the Right of First Refusal
              --------------

                                      -4-
<PAGE>

described in Section 3(b) and the expiration or exercise of the Company's
repurchase option described in Section 3(a) above, a new certificate or
certificates representing the Shares not repurchased shall be issued, on
request, without the legend referred to in Section 6(a)(ii) herein and delivered
to Purchaser.

     4.   Escrow of Unvested Shares.  For purposes of facilitating the
          -------------------------
enforcement of the provisions of Section 3 above, Purchaser agrees, immediately
upon receipt of the certificate(s) for the Shares subject to the Company's
Repurchase Option described in Section 3(a), to deliver such certificate(s),
together with an Assignment Separate from Certificate in the form attached to
this Agreement as Attachment A executed by Purchaser and by Purchaser's spouse
                  ------------
(if required for transfer), in blank, to the Secretary of the Company, or the
Secretary's designee, to hold such certificate(s) and Assignment Separate from
Certificate in escrow and to take all such actions and to effectuate all such
transfers and/or releases as are in accordance with the terms of this Agreement.
Purchaser hereby acknowledges that the Secretary of the Company, or the
Secretary's designee, is so appointed as the escrow holder with the foregoing
authorities as a material inducement to make this Agreement and that said
appointment is coupled with an interest and is accordingly irrevocable.
Purchaser agrees that said escrow holder shall not be liable to any party hereof
(or to any other party).  The escrow holder may rely upon any letter, notice or
other document executed by any signature purported to be genuine and may resign
at any time.  Purchaser agrees that if the Secretary of the Company, or the
Secretary's designee, resigns as escrow holder for any or no reason, the Board
of Directors of the Company shall have the power to appoint a successor to serve
as escrow holder pursuant to the terms of this Agreement.

     5.   Investment and Taxation Representations.  In connection with the
          ---------------------------------------
purchase of the Shares, Purchaser represents to the Company the following:

          (a) Purchaser is aware of the Company's business affairs and financial
condition and has acquired sufficient information about the Company to reach an
informed and knowledgeable decision to acquire the securities.  Purchaser is
purchasing these securities for investment for his or her own account only and
not with a view to, or for resale in connection with, any "distribution" thereof
within the meaning of the Securities Act.

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

          (c) Purchaser understands that the Shares are "restricted securities"
under applicable U.S. federal and state securities laws and that, pursuant to
these laws, Purchaser must hold the Shares indefinitely unless they are
registered with the Securities and Exchange Commission and qualified by state
authorities, or an exemption from such registration and qualification
requirements is available. Purchaser acknowledges that the Company has no
obligation to register or qualify the Shares for resale.  Purchaser further
acknowledges that if an exemption from registration or qualification is
available, it may be conditioned on various requirements including, but not
limited to, the time and manner of sale, the holding period for the Shares, and
requirements relating to the Company which are outside of the Purchaser's
control, and which the Company is under no obligation and may not be able to
satisfy.

                                      -5-
<PAGE>

          (d) Purchaser understands that Purchaser may suffer adverse tax
consequences as a result of Purchaser's purchase or disposition of the Shares.
Purchaser represents that Purchaser has consulted any tax consultants Purchaser
deems advisable in connection with the purchase or disposition of the Shares and
that Purchaser is not relying on the Company for any tax advice.

     6.   Restrictive Legends and Stop-Transfer Orders.
          --------------------------------------------

          (a)  Legends.  The certificate or certificates representing the Shares
               -------
shall bear the following legends (as well as any legends required by applicable
state and federal corporate and securities laws):

               (i)  THE SHARES REPRESENTED BY THIS CERTIFICATE HAVE NOT BEEN
                    REGISTERED UNDER THE SECURITIES ACT OF 1933, AND HAVE BEEN
                    ACQUIRED FOR INVESTMENT AND NOT WITH A VIEW TO, OR IN
                    CONNECTION WITH, THE SALE OR DISTRIBUTION THEREOF.  NO SUCH
                    SALE, DISTRIBUTION OR OTHER DISPOSITION MAY BE EFFECTED
                    WITHOUT AN EFFECTIVE REGISTRATION STATEMENT RELATED THERETO
                    OR AN OPINION OF COUNSEL IN A FORM SATISFACTORY TO THE
                    COMPANY THAT SUCH REGISTRATION IS NOT REQUIRED UNDER THE
                    SECURITIES ACT OF 1933.

               (ii) THE SHARES REPRESENTED BY THIS CERTIFICATE MAY BE
                    TRANSFERRED ONLY IN ACCORDANCE WITH THE TERMS OF AN
                    AGREEMENT BETWEEN THE COMPANY AND THE STOCKHOLDER, A COPY OF
                    WHICH IS ON FILE WITH THE SECRETARY OF THE COMPANY.

          (b)  Stop-Transfer Notices.  Purchaser agrees that, in order to ensure
               ---------------------
compliance with the restrictions referred to herein, the Company may issue
appropriate "stop transfer" instructions to its transfer agent, if any, and
that, if the Company transfers its own securities, it may make appropriate
notations to the same effect in its own records.

          (c)  Refusal to Transfer.  The Company shall not be required (i) to
               -------------------
transfer on its books any Shares that have been sold or otherwise transferred in
violation of any of the provisions of this Agreement or (ii) to treat as owner
of such Shares or to accord the right to vote or pay dividends to any purchaser
or other transferee to whom such Shares shall have been so transferred.

     7.   No Employment Rights.  Nothing in this Agreement shall affect in any
          --------------------
manner whatsoever the right or power of the Company, or a Parent or Subsidiary
of the Company, to

                                      -6-
<PAGE>

terminate Purchaser's employment or consulting relationship, for any reason,
with or without cause.

     8.   Section 83(b) Election.  Purchaser understands that Section 83(a) of
          ----------------------
the Internal Revenue Code of 1986, as amended (the "Code"), taxes as ordinary
                                                    ----
income for a Nonstatutory Stock Option and as alternative minimum taxable income
for an Incentive Stock Option the difference between the amount paid for the
Shares and the Fair Market Value of the Shares as of the date any restrictions
on the Shares lapse.  In this context, "restriction" means the right of the
                                        -----------
Company to buy back the Shares pursuant to the Repurchase Option set forth in
Section 3(a) of this Agreement.  Purchaser understands that Purchaser may elect
to be taxed at the time the Shares are purchased, rather than when and as the
Repurchase Option expires, by filing an election under Section 83(b) (an "83(b)
                                                                          -----
Election") of the Code with the Internal Revenue Service within 30 days from the
--------
date of purchase.  Even if the Fair Market Value of the Shares at the time of
the execution of this Agreement equals the amount paid for the Shares, the
election must be made to avoid income and alternative minimum tax treatment
under Section 83(a) in the future.  Purchaser understands that failure to file
such an election in a timely manner may result in adverse tax consequences for
Purchaser.  Purchaser further understands that an additional copy of such
election form should be filed with his or her federal income tax return for the
calendar year in which the date of this Agreement falls.  Purchaser acknowledges
that the foregoing is only a summary of the effect of United States federal
income taxation with respect to purchase of the Shares hereunder, and does not
purport to be complete.  Purchaser further acknowledges that the Company has
directed Purchaser to seek independent advice regarding the applicable
provisions of the Code, the income tax laws of any municipality, state or
foreign country in which Purchaser may reside, and the tax consequences of
Purchaser's death.

     Purchaser agrees that he or she will execute and deliver to the Company
with this executed Agreement a copy of the Acknowledgment and Statement of
Decision Regarding Section 83(b) Election (the "Acknowledgment") attached hereto
                                                --------------
as Attachment B.  Purchaser further agrees that he or she will execute and
   ------------
submit with the Acknowledgment a copy of the 83(b) Election attached hereto as

Attachment C (for income tax purposes in connection with the early exercise of a
------------
Nonstatutory Stock Option) or Attachment D (for alternative minimum tax purposes
                              ------------
in connection with the early exercise of an incentive stock option) if Purchaser
has indicated in the Acknowledgment his or her decision to make such an
election.

     9.   Market Stand-off Agreement.  In connection with the initial public
          --------------------------
offering of the Company's securities and upon request of the Company or the
underwriters managing such underwritten offering of the Company's securities,
Purchaser agrees not to sell, make any short sale of, loan, grant any option for
the purchase of, or otherwise dispose of any Shares (other than those included
in the registration) without the prior written consent of the Company or such
underwriters, as the case may be, for such period of time (not to exceed 180
days) from the effective date of such registration as may be requested by the
Company or such managing underwriters and to execute an agreement reflecting the
foregoing as may be requested by the underwriters at the time of the Company's
initial public offering.

                                      -7-
<PAGE>

     10.  Miscellaneous.
          -------------

          (a) Governing Law.  This Agreement and all acts and transactions
              -------------
pursuant hereto and the rights and obligations of the parties hereto shall be
governed, construed and interpreted in accordance with the laws of the State of
California, without giving effect to principles of conflicts of law.

          (b) Entire Agreement; Enforcement of Rights.  This Agreement sets
              ---------------------------------------
forth the entire agreement and understanding of the parties relating to the
subject matter herein and merges all prior discussions between them.  No
modification of or amendment to this Agreement, nor any waiver of any rights
under this Agreement, shall be effective unless in writing signed by the parties
to this Agreement.  The failure by either party to enforce any rights under this
Agreement shall not be construed as a waiver of any rights of such party.

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

          (d) Construction.  This Agreement is the result of negotiations
              ------------
between and has been reviewed by each of the parties hereto and their respective
counsel, if any; accordingly, this Agreement shall be deemed to be the product
of all of the parties hereto, and no ambiguity shall be construed in favor of or
against any one of the parties hereto.

          (e) Notices.  Any notice required or permitted by this Agreement shall
              -------
be in writing and shall be deemed sufficient when delivered personally or sent
by telegram or fax or 48 hours after being deposited in the U.S. mail, as
certified or registered mail, with postage prepaid, and addressed to the party
to be notified at such party's address as set forth below or as subsequently
modified by written notice.

          (f) Counterparts.  This Agreement may be executed in two or more
              ------------
counterparts, each of which shall be deemed an original and all of which
together shall constitute one instrument.

          (g) Successors and Assigns.  The rights and benefits of this Agreement
              ----------------------
shall inure to the benefit of, and be enforceable by the Company's successors
and assigns.  The rights and obligations of Purchaser under this Agreement may
only be assigned with the prior written consent of the Company.

          (h) California Corporate Securities Law.  THE SALE OF THE SECURITIES
              -----------------------------------
WHICH ARE THE SUBJECT OF THIS AGREEMENT HAS NOT BEEN QUALIFIED WITH THE
COMMISSIONER OF CORPORATIONS OF THE STATE OF CALIFORNIA AND THE ISSUANCE OF THE
SECURITIES OR THE PAYMENT OR RECEIPT OF ANY PART OF THE CONSIDERATION THEREFOR
PRIOR TO THE QUALIFICATION IS UNLAWFUL, UNLESS THE SALE OF SECURITIES IS EXEMPT
FROM QUALIFICATION BY SECTION 25100, 25102 OR 25105 OF THE CALIFORNIA

                                      -8-
<PAGE>

CORPORATIONS CODE.  THE RIGHTS OF ALL PARTIES TO THIS AGREEMENT ARE EXPRESSLY
CONDITIONED UPON THE QUALIFICATION BEING OBTAINED, UNLESS THE SALE IS SO EXEMPT.

                            [Signature Page Follows]

                                      -9-
<PAGE>

     The parties have executed this Agreement as of the date first set forth
above.

                              COMPANY:

                              SIGNIO, INC.

                              By:___________________________________

                              Name:_________________________________
                                     (print)

                              Title:________________________________

                              PURCHASER:

                               _____________________________________
                              (Signature)

                              ______________________________________
                              (Print Name)

                              Address:______________________________

                                      ______________________________

I, ______________________, spouse of Purchaser, have read and hereby approve the
foregoing Agreement.  In consideration of the Company's granting my spouse the
right to purchase the Shares as set forth in the Agreement, I hereby agree to be
bound irrevocably by the Agreement and further agree that any community property
or similar interest that I may have in the Shares shall hereby be similarly
bound by the Agreement.  I hereby appoint my spouse as my attorney-in-fact with
respect to any amendment or exercise of any rights under the Agreement.

                                          ___________________________________
                                          Spouse of Purchaser (if applicable)

                                     -10-
<PAGE>

                                 ATTACHMENT A
                                 ------------

                     ASSIGNMENT SEPARATE FROM CERTIFICATE
                     ------------------------------------

          FOR VALUE RECEIVED and pursuant to that certain Early Exercised Notice
and Restricted Stock Purchase Agreement between the undersigned ("Purchaser")
                                                                  ---------
and SIGNIO, INC. (the "Company") dated _______________, ____ (the "Agreement"),
                       -------                                     ---------
Purchaser hereby sells, assigns and transfers unto the Company
_________________________________ (________) shares of the Common Stock of the
Company, standing in Purchaser's name on the books of the Company and
represented by Certificate No. ____, and does hereby irrevocably constitute and
appoint ________________________________________________ to transfer said stock
on the books of the Company with full power of substitution in the premises.
THIS ASSIGNMENT MAY ONLY BE USED AS AUTHORIZED BY THE AGREEMENT AND THE
ATTACHMENTS THERETO.

Dated: ______________________

                              ____________________________________
                              (Signature)

                              ____________________________________
                              (Print Name)

                              ____________________________________
                              Spouse of Purchaser  (if applicable)

Instruction:  Please do not fill in any blanks other than the signature line.
The purpose of this assignment is to enable the Company to exercise its
Repurchase Option set forth in the Agreement without requiring additional
signatures on the part of Purchaser.
<PAGE>

                                 ATTACHMENT B
                                 ------------

                   ACKNOWLEDGMENT AND STATEMENT OF DECISION
                   ----------------------------------------
                       REGARDING SECTION 83(b) ELECTION
                       --------------------------------

     The undersigned (which term includes the undersigned's spouse), a purchaser
of ___________ shares of Common Stock of SIGNIO, INC., a California corporation
(the "Company") by exercise of an option (the "Option") granted pursuant to the
      -------                                  ------
Company's 1998 Stock Plan (the "Plan"), hereby states as follows:
                                ----

     1.  The undersigned acknowledges receipt of a copy of the Plan relating to
the offering of such shares.  The undersigned has carefully reviewed the Plan
and the option agreement pursuant to which the Option was granted.

     2.  The undersigned either [check and complete as applicable]:

     (a) ____ has consulted, and has been fully advised by, the undersigned's
          own tax advisor, _____________________________________, whose business
          address is ______________________________, regarding the federal,
          state and local tax consequences of purchasing shares under the Plan,
          and particularly regarding the advisability of making elections
          pursuant to Section 83(b) of the Internal Revenue Code of 1986, as
          amended (the "Code") and pursuant to the corresponding provisions, if
                        ----
          any, of applicable state law; or

     (b) ____ has knowingly chosen not to consult such a tax advisor.

     3.  The undersigned hereby states that the undersigned has decided [check
as applicable]:

     (a) ____ to make an election pursuant to Section 83(b) of the Code, and is
          submitting to the Company, together with the undersigned's executed
          Early Exercise Notice and Restricted Stock Purchase Agreement, an
          executed form entitled "Election Under Section 83(b) of the Internal
          Revenue Code of 1986;"

     (b) ____ to make an election pursuant to Section 83(b) of the Code, and is
          submitting to the Company, together with the undersigned's executed
          Early Exercise Notice and Restricted Stock Purchase Agreement, an
          executed form entitled "Election Under Section 83(b) of the Internal
          Revenue Code of 1986 for purposes of the Alternative Minimum Tax"; or

     (c) ____ not to make an election pursuant to Section 83(b) of the Code.
<PAGE>

     4.  Neither the Company nor any subsidiary or representative of the Company
has made any warranty or representation to the undersigned with respect to the
tax consequences of the undersigned's purchase of shares under the Plan or of
the making or failure to make an election pursuant to Section 83(b) of the Code
or the corresponding provisions, if any, of applicable state law.

Date:______________________   ____________________________________
                              (Signature)

                              ____________________________________
                              (Print Name)

Date:______________________   ____________________________________
                              Spouse of Purchaser (if applicable)

                                      -2-
<PAGE>

                                 ATTACHMENT C
                                 ------------

                         ELECTION UNDER SECTION 83(b)
                         ----------------------------
                     OF THE INTERNAL REVENUE CODE OF 1986
                     ------------------------------------

     The undersigned taxpayer hereby elects, pursuant to Section 83(b) of the
Internal Revenue Code, to include in taxpayer's gross income for the current
taxable year, the amount of any compensation taxable to taxpayer in connection
with taxpayer's receipt of the property described below:

1.   The name, address, taxpayer identification number and taxable year of the
     undersigned are as follows:

     NAME OF TAXPAYER:_________________________________

     NAME OF SPOUSE:___________________________________

     ADDRESS:__________________________________________

     IDENTIFICATION NO. OF TAXPAYER:___________________

     IDENTIFICATION NO. OF SPOUSE:_____________________

     TAXABLE YEAR:  __________

2.   The property with respect to which the election is made is described as
     follows:

     ______________ shares of the Common Stock $0.001 par value, of SIGNIO,
     INC., a California corporation (the "Company").
                                          -------

3.   The date on which the property was transferred is:  _______________

4.   The property is subject to the following restrictions:

     Repurchase option at cost in favor of the Company upon termination of
     taxpayer's employment or consulting relationship.

5.   The fair market value at the time of transfer, determined without regard to
     any restriction other than a restriction which by its terms will never
     lapse, of such property is: $____________

6.   The amount (if any) paid for such property: $____________

The undersigned has submitted a copy of this statement to the person for whom
the services were performed in connection with the undersigned's receipt of the
above-described property.  The transferee of such property is the person
performing the services in connection with the transfer of said property.

The undersigned understands that the foregoing election may not be revoked
--------------------------------------------------------------------------
except with the consent of the Commissioner.
-------------------------------------------

Dated: ____________                 _____________________________________
                                    Taxpayer

Dated: ____________                 _____________________________________
                                    Spouse of Taxpayer
<PAGE>

                                 ATTACHMENT D
                                 ------------

                         ELECTION UNDER SECTION 83(b)
                         ----------------------------
                     OF THE INTERNAL REVENUE CODE OF 1986
                     ------------------------------------
                  FOR PURPOSES OF THE ALTERNATIVE MINIMUM TAX
                  -------------------------------------------

     The undersigned taxpayer hereby elects, pursuant to the above-referenced
Internal Revenue Code Section, to include in his or her alternative minimum
taxable income for the current taxable year, as compensation for services, the
excess, if any, of the fair market value of the property described below:

1.   The name, address, taxpayer identification number and taxable year of the
     undersigned are as follows:

     NAME OF TAXPAYER:___________________________________

     NAME OF SPOUSE:_____________________________________

     ADDRESS:____________________________________________

     IDENTIFICATION NO. OF TAXPAYER:_____________________

     IDENTIFICATION NO. OF SPOUSE:_______________________

     TAXABLE YEAR: __________

2.   The property with respect to which the election is made is described as
     follows:

     ________________ shares of the Common Stock $0.001 par value, of SIGNIO,
     INC., a California corporation (the "Company").
                                          -------

3.   The date on which the property was transferred is:  _______________

4.   The property is subject to the following restrictions:

     Repurchase option at cost in favor of the Company upon termination of
     taxpayer's employment or consulting relationship.

5.   The fair market value at the time of transfer, determined without regard to
     any restriction other than a restriction which by its terms will never
     lapse, of such property is: $_______________.

6.   The amount (if any) paid for such property: $_______________

The undersigned has submitted a copy of this statement to the person for whom
the services were performed in connection with the undersigned's receipt of the
above-described property.  The transferee of such property is the person
performing the services in connection with the transfer of said property.

The undersigned understands that the foregoing election may not be revoked
--------------------------------------------------------------------------
except with the consent of the Commissioner.
-------------------------------------------

Dated: ____________                 _____________________________________
                                    Taxpayer

Dated: ____________                 _____________________________________
                                    Spouse of Taxpayer
<PAGE>

                              RECEIPT AND CONSENT
                              -------------------

     The undersigned hereby acknowledges receipt of a photocopy of Certificate
No. ______ for ________ shares of Common Stock of SIGNIO, INC. (the "Company").
                                                                     -------

     The undersigned further acknowledges that the Secretary of the Company, or
his or her designee, is acting as escrow holder pursuant to the Early Exercise
Notice and Restricted Stock Purchase Agreement Purchaser has previously entered
into with the Company.  As escrow holder, the Secretary of the Company, or his
or her designee, holds the original of the aforementioned certificate issued in
the undersigned's name.

Dated:  _______________

                              ____________________________________
                              (Signature)

                              ____________________________________
                              (Print Name)
<PAGE>

                                   EXHIBIT B
                                   ---------

                                 SIGNIO, INC.

                                1998 STOCK PLAN

            EXERCISE NOTICE AND RESTRICTED STOCK PURCHASE AGREEMENT
            -------------------------------------------------------

     This Agreement ("Agreement") is made as of ______________, by and between
                      ---------
SIGNIO, INC., a California corporation (the "Company"), and (Optionee)
                                             -------
("Purchaser").  To the extent any capitalized terms used in this Agreement are
  ---------
not defined, they shall have the meaning ascribed to them in the 1998 Stock
Plan.

     1.  Exercise of Option.  Subject to the terms and conditions hereof,
         ------------------
Purchaser hereby elects to exercise his or her option to purchase __________
shares of the Common Stock (the "Shares") of the Company under and pursuant to
                                 ------
the Company's 1998 Stock Plan (the "Plan") and the Stock Option Agreement dated
                                    ----
______________, (the "Option Agreement").  The purchase price for the Shares
                      ----------------
shall be $__________ per Share for a total purchase price of $_______________.
The term "Shares" refers to the purchased Shares and all securities received in
          ------
replacement of the Shares or as stock dividends or splits, all securities
received in replacement of the Shares in a recapitalization, merger,
reorganization, exchange or the like, and all new, substituted or additional
securities or other properties to which Purchaser is entitled by reason of
Purchaser's ownership of the Shares.

     2.  Time and Place of Exercise.  The purchase and sale of the Shares under
         --------------------------
this Agreement shall occur at the principal office of the Company simultaneously
with the execution and delivery of this Agreement in accordance with the
provisions of Section 2(b) of the Option Agreement.  On such date, the Company
will deliver to Purchaser a certificate representing the Shares to be purchased
by Purchaser (which shall be issued in Purchaser's name) against payment of the
purchase price therefor by Purchaser by (a) check made payable to the Company,
(b) cancellation of indebtedness of the Company to Purchaser, (c) delivery of
shares of the Common Stock of the Company in accordance with Section 3 of the
Option Agreement, (d)  at the discretion of the Administrator and subject to
Section 153 of the Delaware General Corporation Law, delivery of a promissory
note in the form attached as Exhibit C to the Option Agreement (or in any form
                             ---------
acceptable to the Company), or (e) a combination of the foregoing.  If Purchaser
delivers a promissory note as partial or full payment of the purchase price,
Purchaser will also deliver a Pledge and Security Agreement in the form attached
as Exhibit D to the Option Agreement (or in any form acceptable to the Company).
   ---------

     3.  Limitations on Transfer.  In addition to any other limitation on
         -----------------------
transfer created by applicable securities laws, Purchaser shall not assign,
encumber or dispose of any interest in the Shares except in compliance with the
provisions below and applicable securities laws.

          (a) Right of First Refusal.  Before any Shares held by Purchaser or
              ----------------------
any transferee of Purchaser (either being sometimes referred to herein as the
"Holder") may be sold or otherwise transferred (including transfer by gift or
 ------
operation of law), the Company or its assignee(s) shall have a right of first
refusal to purchase the Shares on the terms and conditions set forth in this
Section 3(a) (the "Right of First Refusal").
                   ----------------------
<PAGE>

               (i)   Notice of Proposed Transfer.  The Holder of the Shares
                     ---------------------------
shall deliver to the Company a written notice (the "Notice") stating:  (i) the
                                                    ------
Holder's bona fide intention to sell or otherwise transfer such Shares; (ii) the
name of each proposed purchaser or other transferee ("Proposed Transferee");
                                                      -------------------
(iii) the number of Shares to be transferred to each Proposed Transferee; and
(iv) the terms and conditions of each proposed sale or transfer.  The Holder
shall offer the Shares at the same price (the "Offered Price") and upon the same
                                               -------------
terms (or terms as similar as reasonably possible) to the Company or its
assignee(s).

               (ii)  Exercise of Right of First Refusal.  At any time within 30
                     ----------------------------------
days after receipt of the Notice, the Company and/or its assignee(s) may, by
giving written notice to the Holder, elect to purchase all, but not less than
all, of the Shares proposed to be transferred to any one or more of the Proposed
Transferees, at the purchase price determined in accordance with subsection
(iii) below.

               (iii) Purchase Price.  The purchase price ("Purchase Price")
                     --------------                        --------------
for the Shares purchased by the Company or its assignee(s) under this Section
3(a) shall be the Offered Price. If the Offered Price includes consideration
other than cash, the cash equivalent value of the non-cash consideration shall
be determined by the Board of Directors of the Company in good faith.

               (iv)  Payment.  Payment of the Purchase Price shall be made, at
                     -------
the option of the Company or its assignee(s), in cash (by check), by
cancellation of all or a portion of any outstanding indebtedness of the Holder
to the Company (or, in the case of repurchase by an assignee, to the assignee),
or by any combination thereof within 30 days after receipt of the Notice or in
the manner and at the times set forth in the Notice.

               (v) Holder's Right to Transfer.  If all of the Shares proposed
                   --------------------------
in the Notice to be transferred to a given Proposed Transferee are not purchased
by the Company and/or its assignee(s) as provided in this Section 3(a), then the
Holder may sell or otherwise transfer such Shares to that Proposed Transferee at
the Offered Price or at a higher price, provided that such sale or other
transfer is consummated within 60 days after the date of the Notice and provided
further that any such sale or other transfer is effected in accordance with any
applicable securities laws and the Proposed Transferee agrees in writing that
the provisions of this Section 3 shall continue to apply to the Shares in the
hands of such Proposed Transferee. If the Shares described in the Notice are not
transferred to the Proposed Transferee within such period, or if the Holder
proposes to change the price or other terms to make them more favorable to the
Proposed Transferee, a new Notice shall be given to the Company, and the Company
and/or its assignees shall again be offered the Right of First Refusal before
any Shares held by the Holder may be sold or otherwise transferred.

               (vi)  Exception for Certain Family Transfers.  Anything to the
                     --------------------------------------
contrary contained in this Section 3(a) notwithstanding, the transfer of any or
all of the Shares during Purchaser's lifetime or on Purchaser's death by will or
intestacy to Purchaser's Immediate Family (as defined below) or a trust for the
benefit of Purchaser's Immediate Family shall be exempt from the provisions of
this Section 3(a). "Immediate Family" as used herein shall mean spouse, lineal
                    ----------------
descendant or antecedent, father, mother, brother or sister.  In such case, the
transferee or other recipient shall receive and hold the Shares so transferred
subject to the

                                      -2-
<PAGE>

provisions of this Section, and there shall be no further transfer of such
Shares except in accordance with the terms of this Section 3.

          (b)  Involuntary Transfer.
               --------------------

               (i)   Company's Right to Purchase upon Involuntary Transfer.
                     -----------------------------------------------------
In the event, at any time after the date of this Agreement, of any transfer by
operation of law or other involuntary transfer (including death or divorce, but
excluding a transfer to Immediate Family as set forth in Section 3(a)(vi) above)
of all or a portion of the Shares by the record holder thereof, the Company
shall have an option to purchase all of the Shares transferred at the greater of
the purchase price paid by Purchaser pursuant to this Agreement or the Fair
Market Value of the Shares on the date of transfer.  Upon such a transfer, the
person acquiring the Shares shall promptly notify the Secretary of the Company
of such transfer.  The right to purchase such Shares shall be provided to the
Company for a period of 30 days following receipt by the Company of written
notice by the person acquiring the Shares.

               (ii)  Price for Involuntary Transfer.  With respect to any stock
                     ------------------------------
to be transferred pursuant to Section 3(b)(i), the price per Share shall be a
price set by the Board of Directors of the Company that will reflect the current
value of the stock in terms of present earnings and future prospects of the
Company. The Company shall notify Purchaser or his or her executor of the price
so determined within 30 days after receipt by it of written notice of the
transfer or proposed transfer of Shares. However, if the Purchaser does not
agree with the valuation as determined by the Board of Directors of the Company,
the Purchaser shall be entitled to have the valuation determined by an
independent appraiser to be mutually agreed upon by the Company and the
Purchaser and whose fees shall be borne equally by the Company and the
Purchaser.

          (c) Assignment.  The right of the Company to purchase any part of the
              ----------
Shares may be assigned in whole or in part to any shareholder or shareholders of
the Company or other persons or organizations; provided, however, that an
assignee, other than a corporation that is the Parent or a 100% owned Subsidiary
of the Company, must pay the Company, upon assignment of such right, cash equal
to the difference between the original purchase price and Fair Market Value, if
the original purchase price is less than the Fair Market Value of the Shares
subject to the assignment.

          (e) Restrictions Binding on Transferees.  All transferees of Shares or
              -----------------------------------
any interest therein will receive and hold such Shares or interest subject to
the provisions of this Agreement.  Any sale or transfer of the Company's Shares
shall be void unless the provisions of this Agreement are satisfied.

          (f) Termination of Rights.  The Right of First Refusal granted the
              ---------------------
Company by Section 3(a) above and the option to repurchase the Shares in the
event of an involuntary transfer granted the Company by Section 3(b) above shall
terminate upon the first sale of Common Stock of the Company to the general
public pursuant to a registration statement filed with and declared effective by
the Securities and Exchange Commission under the Securities Act or 1933, as
amended (the "Securities Act").  Upon termination of the Right of First Refusal
              --------------
described in Section 3(a) above, a new certificate or certificates representing
the Shares not

                                      -3-
<PAGE>

repurchased shall be issued, on request, without the legend referred to in
Section 6(a)(ii) herein and delivered to Purchaser.

     4.   Investment and Taxation Representations.  In connection with the
          ---------------------------------------
purchase of the Shares, Purchaser represents to the Company the following:

          (a) Purchaser is aware of the Company's business affairs and financial
condition and has acquired sufficient information about the Company to reach an
informed and knowledgeable decision to acquire the securities.  Purchaser is
purchasing these securities for investment for his or her own account only and
not with a view to, or for resale in connection with, any "distribution" thereof
within the meaning of the Securities Act.

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

          (c) Purchaser understands that the Shares are "restricted securities"
under applicable U.S. federal and state securities laws and that, pursuant to
these laws, Purchaser must hold the Shares indefinitely unless they are
registered with the Securities and Exchange Commission and qualified by state
authorities, or an exemption from such registration and qualification
requirements is available. Purchaser acknowledges that the Company has no
obligation to register or qualify the Shares for resale.  Purchaser further
acknowledges that if an exemption from registration or qualification is
available, it may be conditioned on various requirements including, but not
limited to, the time and manner of sale, the holding period for the Shares, and
requirements relating to the Company which are outside of the Purchaser's
control, and which the Company is under no obligation and may not be able to
satisfy.

          (d) Purchaser understands that Purchaser may suffer adverse tax
consequences as a result of Purchaser's purchase or disposition of the Shares.
Purchaser represents that Purchaser has consulted any tax consultants Purchaser
deems advisable in connection with the purchase or disposition of the Shares and
that Purchaser is not relying on the Company for any tax advice.

     5.   Restrictive Legends and Stop-Transfer Orders.
          --------------------------------------------

          (a) Legends.  The certificate or certificates representing the Shares
              -------
shall bear the following legends (as well as any legends required by applicable
state and federal corporate and securities laws):

               (i)  THE SHARES REPRESENTED BY THIS CERTIFICATE HAVE NOT BEEN
                    REGISTERED UNDER THE SECURITIES ACT OF 1933, AND HAVE BEEN
                    ACQUIRED FOR INVESTMENT AND NOT WITH A VIEW TO, OR IN
                    CONNECTION WITH, THE SALE OR DISTRIBUTION THEREOF.  NO SUCH
                    SALE, DISTRIBUTION OR OTHER DISPOSITION MAY BE EFFECTED
                    WITHOUT AN EFFECTIVE REGISTRATION STATEMENT RELATED THERETO

                                      -4-
<PAGE>

                    OR AN OPINION OF COUNSEL IN A FORM SATISFACTORY TO THE
                    COMPANY THAT SUCH REGISTRATION IS NOT REQUIRED UNDER THE
                    SECURITIES ACT OF 1933.

               (ii) THE SHARES REPRESENTED BY THIS CERTIFICATE MAY BE
                    TRANSFERRED ONLY IN ACCORDANCE WITH THE TERMS OF AN
                    AGREEMENT BETWEEN THE COMPANY AND THE STOCKHOLDER, A COPY OF
                    WHICH IS ON FILE WITH THE SECRETARY OF THE COMPANY.

          (b)  Stop-Transfer Notices.  Purchaser agrees that, in order to ensure
               ---------------------
compliance with the restrictions referred to herein, the Company may issue
appropriate "stop transfer" instructions to its transfer agent, if any, and
that, if the Company transfers its own securities, it may make appropriate
notations to the same effect in its own records.

          (c)  Refusal to Transfer.  The Company shall not be required (i) to
               -------------------
transfer on its books any Shares that have been sold or otherwise transferred in
violation of any of the provisions of this Agreement or (ii) to treat as owner
of such Shares or to accord the right to vote or pay dividends to any purchaser
or other transferee to whom such Shares shall have been so transferred.

     6.  No Employment Rights.  Nothing in this Agreement shall affect in any
         --------------------
manner whatsoever the right or power of the Company, or a Parent or Subsidiary
of the Company, to terminate Purchaser's employment or consulting relationship,
for any reason, with or without cause.

     7.  Market Stand-off Agreement.  In connection with the initial public
         --------------------------
offering of the Company's securities and upon request of the Company or the
underwriters managing such underwritten offering of the Company's securities,
Purchaser agrees not to sell, make any short sale of, loan, grant any option for
the purchase of, or otherwise dispose of any Shares (other than those included
in the registration) without the prior written consent of the Company or such
underwriters, as the case may be, for such period of time (not to exceed 180
days) from the effective date of such registration as may be requested by the
Company or such managing underwriters and to execute an agreement reflecting the
foregoing as may be requested by the underwriters at the time of the Company's
initial public offering.

     8.   Miscellaneous.
          -------------

          (a) Governing Law.  This Agreement and all acts and transactions
              -------------
pursuant hereto and the rights and obligations of the parties hereto shall be
governed, construed and interpreted in accordance with the laws of the State of
California, without giving effect to principles of conflicts of law.

          (b) Entire Agreement; Enforcement of Rights.  This Agreement sets
              ---------------------------------------
forth the entire agreement and understanding of the parties relating to the
subject matter herein and

                                      -5-
<PAGE>

merges all prior discussions between them. No modification of or amendment to
this Agreement, nor any waiver of any rights under this Agreement, shall be
effective unless in writing signed by the parties to this Agreement. The failure
by either party to enforce any rights under this Agreement shall not be
construed as a waiver of any rights of such party.

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

          (d) Construction.  This Agreement is the result of negotiations
              ------------
between and has been reviewed by each of the parties hereto and their respective
counsel, if any; accordingly, this Agreement shall be deemed to be the product
of all of the parties hereto, and no ambiguity shall be construed in favor of or
against any one of the parties hereto.

          (e) Notices.  Any notice required or permitted by this Agreement shall
              -------
be in writing and shall be deemed sufficient when delivered personally or sent
by telegram or fax or 48 hours after being deposited in the U.S. mail, as
certified or registered mail, with postage prepaid, and addressed to the party
to be notified at such party's address as set forth below or as subsequently
modified by written notice.

          (f) Counterparts.  This Agreement may be executed in two or more
              ------------
counterparts, each of which shall be deemed an original and all of which
together shall constitute one instrument.

          (g) Successors and Assigns.  The rights and benefits of this Agreement
              ----------------------
shall inure to the benefit of, and be enforceable by the Company's successors
and assigns.  The rights and obligations of Purchaser under this Agreement may
only be assigned with the prior written consent of the Company.

          (h) California Corporate Securities Law.  THE SALE OF THE SECURITIES
              -----------------------------------
WHICH ARE THE SUBJECT OF THIS AGREEMENT HAS NOT BEEN QUALIFIED WITH THE
COMMISSIONER OF CORPORATIONS OF THE STATE OF CALIFORNIA AND THE ISSUANCE OF THE
SECURITIES OR THE PAYMENT OR RECEIPT OF ANY PART OF THE CONSIDERATION THEREFOR
PRIOR TO THE QUALIFICATION IS UNLAWFUL, UNLESS THE SALE OF SECURITIES IS EXEMPT
FROM QUALIFICATION BY SECTION 25100, 25102 OR 25105 OF THE CALIFORNIA
CORPORATIONS CODE.  THE RIGHTS OF ALL PARTIES TO THIS AGREEMENT ARE EXPRESSLY
CONDITIONED UPON THE QUALIFICATION BEING OBTAINED, UNLESS THE SALE IS SO EXEMPT.

                                      -6-
<PAGE>

                           [Signature Page Follows]

                                      -7-
<PAGE>

     The parties have executed this Agreement as of the date first set forth
above.

                              COMPANY:

                              SIGNIO, INC.

                              By:_____________________________________

                              Name:___________________________________
                                     (print)

                              Title:__________________________________

                              PURCHASER:

                              ____________________________________
                              (Signature)

                              ____________________________________
                              (Print Name)

                              Address:____________________________

                                      ____________________________

I, ______________________, spouse of Purchaser, have read and hereby approve the
foregoing Agreement.  In consideration of the Company's granting my spouse the
right to purchase the Shares as set forth in the Agreement, I hereby agree to be
bound irrevocably by the Agreement and further agree that any community property
or similar interest that I may have in the Shares shall hereby be similarly
bound by the Agreement.  I hereby appoint my spouse as my attorney-in-fact with
respect to any amendment or exercise of any rights under the Agreement.

                                        ________________________________
                                        Spouse of Purchaser

                                      -8-
<PAGE>

                                   EXHIBIT C
                                   ---------

                                PROMISSORY NOTE
                                ---------------

$__________                                  __________, California
                                           ___________________,19__

     For value received, the undersigned promises to pay SIGNIO, INC., a
California corporation (the "Company"), at its principal office the principal
                             -------
sum of $__________ together with interest, compounded annually, from the date of
this Note on the unpaid principal balance from time to time outstanding
hereunder at a rate equal to the minimum rate necessary to avoid the imputation
of interest income to the Company and compensation income to the Maker under the
Internal Revenue Code.  The entire unpaid principal amount of this Note,
together with accrued interest and unpaid interest to date, shall be due and
payable on the earlier of (i) nine (9) months after the closing of an initial
public offering of the Company's Common Stock pursuant to a Registration
Statement on Form S-l, or (ii) five (5) years after the date of this Note. This
Note is being delivered in partial payment of the purchase price of
__________________ shares of the Company's Common Stock (the "Purchased Shares")
acquired by the Maker pursuant to that certain Early Exercise Notice and
Restricted Stock Purchase Agreement dated ___________________, 1998.

     If the undersigned's employment or consulting relationship with the Company
is terminated prior to payment in full of this Note, this Note shall be
immediately due and payable.

     Principal and interest are payable in lawful money of the United States of
America.  AMOUNTS DUE UNDER THIS NOTE MAY BE PREPAID AT ANY TIME WITHOUT
INTEREST OR PENALTY.

     Should suit be commenced to collect any sums due under this Note, such sum
as the Court may deem reasonable shall be added hereto as attorneys' fees.  The
makers and endorsers have severally waived presentment for payment, protest
notice of protest and notice of nonpayment of this Note.

     This Note, which is full recourse, is secured by a pledge of certain shares
of Common Stock of the Company and is subject to the terms of a Pledge and
Security Agreement between the undersigned and the Company of even date
herewith.

                              ____________________________________
                              (Signature)

                              ____________________________________
                              (Print Name)
<PAGE>

                                   EXHIBIT D
                                   ---------

                         PLEDGE AND SECURITY AGREEMENT
                         -----------------------------

     This Pledge and Security Agreement (the "Agreement") is entered into this
                                              ---------
_____ day of ____________ by and between SIGNIO, INC., a California corporation
(the "Company") and ___________________________ ("Purchaser").
      -------                                     ---------

RECITALS
--------

     In connection with Purchaser's exercise of an option to purchase certain
shares of the Company's Common Stock (the "Shares") pursuant to an Option
                                           ------
Agreement dated __________ between Purchaser and the Company, Purchaser is
delivering a promissory note of even date herewith (the "Note") in full or
                                                         ----
partial payment of the exercise price for the Shares.  The company requires that
the Note be secured by a pledge of the Shares or the terms set forth below.

AGREEMENT
---------

     In consideration of the Company's acceptance of the Note as full or partial
payment of the exercise price of the Shares, and for other good and valuable
consideration, the receipt of which is hereby acknowledged, the parties hereto
agree as follows:

     1.  The Note shall become payable in full upon the voluntary or involuntary
termination or cessation of employment of Purchaser with the Company, for any
reason, with or without cause (including death or disability).

     2.  Purchaser shall deliver to the Secretary of the Company, or his or her
designee (hereinafter referred to as the "Pledge Holder"), all certificates
                                          -------------
representing the Shares, together with an Assignment Separate from Certificate
in the form attached to this Agreement as Attachment A executed by Purchaser and
                                          ------------
by Purchaser's spouse (if required for transfer), in blank, for use in
transferring all or a portion of the Shares to the Company if, as and when
required pursuant to this Agreement.  In addition, if Purchaser is married,
Purchaser's spouse shall execute the signature page attached to this Agreement.

     3.  As security for the payment of the Note and any renewal, extension or
modification of the Note, Purchaser hereby grants to the Company a security
interest in and pledges with and delivers to the Company Purchaser's Shares
(sometimes referred to herein as the "Collateral").
                                      ----------

     4.  In the event that Purchaser prepays all or a portion of the Note, in
accordance with the provisions thereof, Purchaser intends, unless written notice
to the contrary is delivered to the Pledge Holder, that the Shares represented
by the portion of the Note so repaid, including annual interest thereon, shall
continue to be so held by the Pledge Holder, to serve as independent collateral
for the outstanding portion of the Note for the purpose of commencing the
holding period set forth in Rule 144(d) promulgated under the Securities Act of
1933, as amended (the "Securities Act").
                       --------------
<PAGE>

     5.  In the event of any foreclosure of the security interest created by
this Agreement, the Company may sell the Shares at a private sale or may
repurchase the Shares itself.  The parties agree that, prior to the
establishment of a public market for the Shares of the Company, the securities
laws affecting sale of the Shares make a public sale of the Shares commercially
unreasonable.  The parties further agree that the repurchasing of such Shares by
the Company, or by any person to whom the Company may have assigned its rights
under this Agreement, is commercially reasonable if made at a price determined
by the Board of Directors in its discretion, fairly exercised, representing what
would be the fair market value of the Shares reduced by any limitation on
transferability, whether due to the size of the block of shares or the
restrictions of applicable securities laws.

     6.   In the event of default in payment when due of any indebtedness under
the Note, the Company may elect then, or at any time thereafter, to exercise all
rights available to a secured party under the California Commercial Code
including the right to sell the Collateral at a private or public sale or
repurchase the Shares as provided above.  The proceeds of any sale shall be
applied in the following order:

          (a) To the extent necessary, proceeds shall be used to pay all
reasonable expenses of the Company in enforcing this Agreement and the Note,
including, without limitation, reasonable attorney's fees and legal expenses
incurred by the Company.

          (b) To the extent necessary, proceeds shall be used to satisfy any
remaining indebtedness under Purchaser's Note.

          (c) Any remaining proceeds shall be delivered to Purchaser.

     7.   Upon full payment by Purchaser of all amounts due under the Note,
Pledge Holder shall deliver to Purchaser all Shares in Pledge Holder's
possession belonging to Purchaser, and Pledge Holder shall thereupon be
discharged of all further obligations under this Agreement; provided, however,
                                                            --------  -------
that Pledge Holder shall nevertheless retain the Shares as escrow agent if at
the time of full payment by Purchaser said Shares are still subject to a
Repurchase Option in favor of the Company.

                                      -2-
<PAGE>

     The parties have executed this Pledge and Security Agreement as of the date
first set forth above.

                              COMPANY:

                              SIGNIO, INC.

                              By:___________________________________

                              Name:_________________________________
                                     (print)

                              Title:________________________________

                                     Address:

                              PURCHASER:

                              ____________________________________
                              (Signature)

                              ____________________________________
                              (Print Name)

                              Address:____________________________

                              ____________________________________

                                      -3-
<PAGE>

                                 ATTACHMENT A
                                 ------------

                     ASSIGNMENT SEPARATE FROM CERTIFICATE
                     ------------------------------------

          FOR VALUE RECEIVED and pursuant to that certain Pledge and Security
Agreement between the undersigned ("Purchaser") and SIGNIO, INC. (the "Company")
                                    ---------                          -------
dated _______________, ____ (the "Agreement"), Purchaser hereby sells, assigns
                                  ---------
and transfers unto the Company _________________________________ (________)
shares of the Common Stock of the Company, standing in Purchaser's name on the
books of the Company and represented by Certificate No. ____, and does hereby
irrevocably constitute and appoint____________________________________________
_________________ to transfer said stock on the books of the Company with full
power of substitution in the premises. THIS ASSIGNMENT MAY ONLY BE USED AS
AUTHORIZED BY THE AGREEMENT.

Dated: ____________

                              Signature:

                              __________________________________________

                              __________________________________________
                              Spouse of Purchaser (if applicable)

Instruction:  Please do not fill in any blanks other than the signature line.
The purpose of this assignment is to perfect the security interest of the
Company pursuant to the Agreement.

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