Document:

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                                                                    EXHIBIT 4.24

                                                                     NO. EW-__

NEITHER THIS WARRANT NOR THE SHARES OF COMMON STOCK OF THE COMPANY ISSUABLE UPON
ITS EXERCISE HAVE BEEN REGISTERED UNDER EITHER THE SECURITIES ACT OF 1933, AS
AMENDED (THE "ACT"), OR UNDER THE SECURITIES LAWS OF ANY STATE OR OTHER
JURISDICTION AND MAY NOT BE SOLD, ASSIGNED, PLEDGED, HYPOTHECATED OR TRANSFERRED
IN THE ABSENCE OF AN EFFECTIVE REGISTRATION STATEMENT WITH RESPECT TO SUCH
SECURITIES UNDER THE ACT AND APPLICABLE SECURITIES LAWS OF ANY STATE OR OTHER
JURISDICTION, OR AN OPINION OF COUNSEL SATISFACTORY TO THE COMPANY THAT SUCH
REGISTRATION IS NOT REQUIRED.

                           MOBILITY ELECTRONICS, INC.
                            (A DELAWARE CORPORATION)

                               WARRANT TO PURCHASE
                             SHARES OF COMMON STOCK

     THIS CERTIFIES THAT, for value received, ____________ or registered
successors or assigns (hereinafter, the "Holder"), is entitled to purchase,
subject to the conditions set forth below, at any time or from time to time
during the Exercise Period (as defined in subsection 1.1 below), ___________
(______) fully paid and non-assessable shares (the "Shares") of the common
stock, par value $0.01 per share (the "Common Stock"), of Mobility Electronics,
Inc., a Delaware corporation (the "Company"), at a purchase price of equal to
the offering price used in the last round of equity private placement financing
(the "Last Private Placement") prior to March 31, 2001 (the "Note Maturity
Date"); provided, however, that if the Company has completed an initial public
offering (the "IPO") of Common Stock prior to the Note Maturity Date, then the
purchase price shall be ninety five percent (95%) of the offering price of the
IPO, subject to adjustment as provided in Section 4 below (the "Warrant Price").

1.   EXERCISE OF WARRANT

     The terms and conditions upon which this Warrant may be exercised, and the
Common Stock covered hereby may be purchased, are as follows:

     1.1 Method Of Exercise. The Holder of this Warrant may, at any time, or
from time to time, on or after the earlier of the date of closing of an IPO by
the Company or the Note Maturity Date, but on or prior to April 30, 2001,
exercise in whole or in part the purchase rights evidenced by this Warrant. Such
exercise shall be effected by: (a) the surrender of the Warrant, together with a
duly executed copy of the form of subscription attached hereto, to the Chief
Executive Officer of the Company at the Company's New Mexico office; and (ii)
the payment to the Company, by certified check or bank draft payable to its
order, of an amount equal to the aggregate Warrant Price for the number of
Shares for which the purchase rights hereunder are being exercised.

                                      B-1

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     1.2 Satisfaction with Requirements of Securities Act of 1933.
Notwithstanding anything herein to the contrary, each and every exercise of this
Warrant is contingent upon the Company's satisfaction that the issuance of
Common Stock upon the exercise is exempt from the requirements of the Securities
Act of 1933, as amended (the "Act") and all applicable state securities laws.
The Holder of this Warrant agrees to execute any and all documents determined
necessary by the Company's counsel to effect the exercise of this Warrant.

     1.3 Issuance Of Shares and New Warrant. In the event the purchase rights
evidenced by this Warrant are exercised in whole or in part, one or more
certificates for the purchased Shares shall be issued as soon as practicable
thereafter to the person exercising such rights. Such Holder shall also be
issued at such time a new Warrant representing the number of Shares (if any) for
which the purchase rights under this Warrant remain unexercised and continuing
in force and effect.

2.   TRANSFERS

     2.1 Transfers. Subject to Section 7 below, this Warrant and all rights
hereunder are transferable in whole or in part by the Holder. The transfer shall
be recorded on the books of the Company upon the surrender of this Warrant,
properly endorsed, to the Chief Executive Officer of the Company at the
Company's New Mexico office and the payment to the Company of all transfer taxes
and other governmental charges imposed on such transfer. In the event of a
partial transfer, the Company shall issue to the several Holders one or more
appropriate new Warrants.

     2.2 Registered Holder. Each Holder agrees that until such time as any
transfer pursuant to subsection 2.1 is recorded on the books of the Company, the
Company may treat the registered Holder of this Warrant as the absolute owner;
provided that nothing herein affects any requirement that transfer of any
Warrant or share of Common Stock issued or issuable upon the exercise thereof by
subject to securities law compliance.

     2.3 Form Of New Warrants. All Warrants issued in connection with transfers
of this Warrant shall bear the same date as this Warrant and shall be
substantially identical in form and provision to this Warrant, with the possible
exception of the number of Shares purchasable thereunder.

3.   FRACTIONAL SHARES

     Notwithstanding that the number of Shares purchasable upon the exercise of
this Warrant may have been adjusted pursuant to the terms hereof, the Company
shall nonetheless not be required to issue fractions of Shares upon exercise of
this Warrant or to distribute certificates that evidence fractional shares nor
shall the Company be required to make any cash payments in lieu thereof upon
exercise of this Warrant. Holder hereby waives any right to receive fractional
Shares. If a fractional Share shall result from adjustments in the number of
Shares purchasable hereunder, the number of Shares purchasable hereunder shall,
on an aggregate basis taking into account all adjustments hereunder from the
date of issuance of this Warrant, be rounded up to the next whole number.

4.   ANTIDILUTION PROVISIONS

     The provisions of this Section 4 shall apply in the event that any of the
events described

                                      B-2
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in this Section 4 shall occur with respect to the Common Stock: (i) if the
Warrant Price has been determined by the Last Private Placement, at any time
after the Last Private Placement; or (ii) if the Warrant Price has been
determined by the IPO, at any time after the IPO:

     4.1 Stock Splits And Combinations. If the Company shall at any time
subdivide or combine its outstanding shares of Common Stock, this Warrant shall,
after that subdivision or combination, evidence the right to purchase the number
of shares of Common Stock that would have been issuable as a result of that
change with respect to the Shares which were purchasable under this Warrant
immediately before that subdivision or combination. If the Company shall at any
time subdivide the outstanding shares of Common Stock, the Warrant Price then in
effect immediately before that subdivision shall be proportionately decreased,
and, if the Company shall at any time combine the outstanding shares of Common
Stock, the Warrant Price then in effect immediately before that combination
shall be proportionately increased. Any adjustment under this Section shall
become effective at the time that such subdivision or combination becomes
effective.

     4.2 Reclassification, Exchange and Substitution. If the Common Stock
issuable upon exercise of this Warrant shall be changed into the same or a
different number of shares of any other class or classes of stock, whether by
capital reorganization, reclassification, or otherwise (other than a subdivision
or combination of shares provided for above), the Holder of this Warrant shall,
on its exercise, be entitled to purchase for the same aggregate consideration,
in lieu of the Common Stock which the Holder would have become entitled to
purchase but for such change, the number of shares of such other class or
classes of stock equivalent to the number of shares of Common Stock that would
have been subject to purchase by the Holder on exercise of this Warrant
immediately before that change.

     4.3 Reorganizations, Mergers, Consolidations Or Sale Of Assets. If at any
time there shall be a capital reorganization of the Common Stock (other than a
combination, reclassification, exchange, or subdivision of shares provided for
elsewhere above) then, as a part of such reorganization, lawful provision shall
be made so that the Holder of this Warrant shall thereafter be entitled to
receive upon exercise of this Warrant, during the period specified in this
Warrant and upon payment of the Warrant Price then in effect, the number of
shares of Common Stock or other securities or property of the Company to which a
holder of the Common Stock deliverable upon exercise of this Warrant would have
been entitled in such capital reorganization if this Warrant had been exercised
immediately before that capital reorganization. In any such case, appropriate
adjustment (as determined in good faith by the Company's Board of Directors)
shall be made in the application of the provisions of this Warrant with respect
to the rights and interests of the Holder of this Warrant after the
reorganization to the end that the provisions of this Warrant (including
adjustment of the Warrant Price then in effect and number of Shares purchasable
upon exercise of this Warrant) shall be applicable after that event, as near as
reasonably may be, in relation to any shares or other property deliverable after
that event upon exercise of this Warrant.

     4.4 Common Stock Dividends; Distributions. In the event the Company should
at any time prior to the expiration of this Warrant fix a record date for the
determination of the holders of Common Stock entitled to receive a dividend or
other distribution payable in additional shares of

                                      B-3
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Common Stock or other securities or rights convertible into or entitling the
holder thereof to receive, directly or indirectly, additional shares of Common
Stock (hereinafter referred to as the "Common Stock Equivalents") without
payment of any consideration by such holder for the additional shares of Common
Stock or Common Stock Equivalents (including the additional shares of Common
Stock issuable upon conversion or exercise thereof), then, as of such record
date (or the date of such distribution, split or subdivision if no record date
is fixed), the Warrant Price shall be appropriately decreased and the number of
shares of Common Stock issuable upon exercise of the Warrant shall be
appropriately increased in proportion to such increase of outstanding shares.

     4.5 Adjustments of Other Distributions. In the event the Company shall
declare a distribution payable in securities of other persons, evidences of
indebtedness issued by the Company or other persons, assets (excluding cash
dividends) or options or rights not referred to in subsection 4.4, then, in each
such case for the purpose of this subsection 4.5, upon exercise of this Warrant
the Holder hereof shall be entitled to a proportionate share of any such
distribution as though such Holder was the holder of the number of shares of
Common Stock into which this Warrant may be exercised as of the record date
fixed for the determination of the holders of Common Stock entitled to receive
such distribution.

     4.6 Certificate as to Adjustments. In the case of each adjustment or
readjustment of the Warrant Price pursuant to this Section 4, the Company will
promptly compute such adjustment or readjustment in accordance with the terms
hereof and cause a certificate setting forth such adjustment or readjustment and
showing in detail the facts upon which such adjustment or readjustment is based,
to be delivered to the Holder of this Warrant. The Company will, upon the
written request at any time of the Holder of this Warrant, furnish or cause to
be furnished to such Holder a certificate setting forth: (a) such adjustments
and readjustments; (b) the Warrant Price at the time in effect; and (c) the
number of shares of Common Stock issuable upon exercise of the Warrant and the
amount, if any, of other property at the time receivable upon the exercise of
the Warrant.

     4.7 Reservation of Stock Issuable Upon Exercise. The Company shall at all
times reserve and keep available out of its authorized but unissued shares of
Common Stock solely for the purpose of effecting the exercise of this Warrant
such number of shares of Common Stock as shall from time to time be sufficient
to effect the exercise of this Warrant and if at any time the number of
authorized but unissued shares of Common Stock shall not be sufficient to effect
the exercise of this Warrant, in addition to such other remedies as shall be
available to the Holder of this Warrant, the Company will use its best efforts
to take such corporate action as may, in the opinion of its counsel, be
necessary to increase its authorized but unissued shares of Common Stock to such
number of shares as shall be sufficient for such purposes.

                                      B-4

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5. RIGHTS PRIOR TO EXERCISE OF WARRANT

     This Warrant does not entitle the Holder to any of the rights of a
stockholder of the Company. If, however, at any time prior to the expiration of
this Warrant and prior to its exercise, any of the following events shall occur:
(a) the Company shall declare any dividend payable in any securities upon the
shares of Common Stock or make any distribution (other than a cash dividend) to
the holders of shares of Common Stock; (b) the Company shall offer to all of the
holders of shares of Common Stock any additional shares of Common Stock or
securities convertible into or exchangeable for shares of Common Stock or any
right to subscribe for or purchase any thereof; or (c) a dissolution,
liquidation or winding up of the Company (other than in connection with a
consolidation, merger, sale, transfer or lease of all or substantially all of
its property, assets, and business as an entirety) shall be proposed and action
by the Company with respect thereto has been approved by the Company's Board of
Directors (each, a "Material Action"), the Company shall give notice in writing
of such Material Action to the Holder at its last address as it shall appear on
the Company's records at least twenty (20) days' prior to the date fixed as a
record date or the date of closing the transfer books for the determination of
the stockholders entitled to such dividends, distribution, or subscription
rights, or for the determination of stockholders entitled to vote on the
Material Action. Such notice shall specify such record date or the date of
closing the transfer books, as the case may be. Failure to publish, mail or
receive such notice or any defect therein or in the publication or mailing
thereof shall not affect the validity of the Material Action.

     Each person in whose name any certificate for Shares is to be issued shall
for all purposes be deemed to have become the holder of record of such Shares on
the date on which this instrument was surrendered and payment of the Warrant
Price was made, irrespective of the date of delivery of such stock certificate,
except that, if the date of such surrender and payment is a date when the stock
transfer books of the Company are closed, such person shall be deemed to have
become the holder of such Shares at the close of business on the next succeeding
date on which the stock transfer books are open.

6.   SUCCESSORS AND ASSIGNS; TRANSFEREES

     The terms and provisions of this Warrant shall inure to the benefit of, and
be binding upon, the Company and the holder thereof and their respective
successors and permitted assigns and other transferees. Any successor, assign or
other transferee of this Warrant, by its acceptance thereof, agrees to be bound
by the terms of this Warrant with the same force and effect as if a signatory
thereto.

7.   RESTRICTED SECURITIES

     In order to enable the Company to comply with the Securities Act and
applicable state laws, the Company may require the Holder as a condition of the
transfer or exercise of this Warrant, to give written assurance satisfactory to
the Company that the Warrant, or in the case of an exercise hereof the Shares
subject to this Warrant, are being acquired for his or her own account, for
investment only, with no view to the distribution of the same, and that any
disposition of all or any portion of this Warrant or the Shares issuable upon
the due exercise of

                                      B-5
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this Warrant shall not be made, unless made in compliance with reg requirements
of the Act and applicable securities laws of any State or other jurisdiction.
Holder acknowledges that this Warrant is, and each of the shares of Common Stock
issuable upon the due exercise hereof will be, a restricted security, and that
the certificates evidencing securities issued to the Holder upon exercise of
this Warrant will bear a legend substantially similar to the legend set forth on
the front page of this Warrant.

8.   LOSS OR MUTILATION

     Upon receipt by the Company of satisfactory evidence of the ownership, and
the loss, theft, destruction, or mutilation, of any Warrant, and (i) in the case
of loss, theft, or destruction, upon receipt by the Company of indemnity
satisfactory to it, or (ii) in the case of mutilation, upon receipt of such
Warrant and upon surrender and cancellation of such Warrant, the Company shall
execute and deliver in lieu thereof a new Warrant representing the right to
purchase an equal number of shares of Common Stock.

9.   NOTICES

     All notices, requests, demands and other communications under this Warrant
shall be in writing and shall be deemed to have been duly given on the date of
service if served personally on the party to whom notice is to be given, or on
the date of mailing if mailed to the party to whom notice is to be given, by
first class mail, registered or certified, postage prepaid, and properly
addressed as follows: if to the Holder, at his address as shown in the Company
records; and if to the Company, at its New Mexico office, attention: Chief
Financial Officer. Any party may change its address for purposes of this Section
by giving the other party written notice of the new address in the manner set
forth above.

10.  GOVERNING LAW

     This Warrant and any dispute, disagreement or issue of construction of
interpretation arising hereunder whether relating to its execution, its
validity, the obligations provided herein or performance shall be governed or
interpreted according to the internal laws of the State of Delaware without
regard to conflicts of law.

     DATED:

                                      MOBILITY ELECTRONICS, INC.

                                      By:
                                               Charles R. Mollo,
                                               Chief Executive Officer

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                                  SUBSCRIPTION

MOBILITY ELECTRONICS, INC.
Attn: Chief Executive Officer
5528 Eubank Blvd., N.E. Suite 3
Albuquerque, New Mexico  87111

Ladies and Gentlemen:

The undersigned, ____________ hereby elects to purchase, pursuant to the
provisions of the foregoing Warrant held by the undersigned, ____________ shares
(the "Shares") of the common stock, par value $0.01 per share (the "Common
Stock"), of Mobility Electronics, Inc., a Delaware corporation.

Payment of the purchase price for the Shares being purchased, as required under
such Warrant, accompanies this subscription.

The undersigned hereby represents and warrants that the undersigned is acquiring
the Shares for the account of the undersigned and not for resale or with a view
to distribution of such Shares or any part hereof; that the undersigned is fully
aware of the transfer restrictions affecting restricted securities under the
pertinent securities laws; and the undersigned understands that the Shares
purchased hereby are restricted securities and that the certificate or
certificates evidencing the same will bear a legend to that effect.

DATED: _____________________.

                               Signature:

                               Printed:

                               Address:Exhibit 10.3

                        MICROCHIP TECHNOLOGY INCORPORATED
                             1993 STOCK OPTION PLAN
                         AS AMENDED THROUGH MAY 6, 2002

                                    ARTICLE I
                                     GENERAL

     1.1 PURPOSE OF THE PLAN

          (a) AMENDMENT. On January 19, 1993, the Board of Directors (the
"Board") of Microchip Technology Incorporated, a Delaware corporation (the
"Corporation") adopted the 1993 Stock Option/Stock Issuance Plan. On April 23,
1993 and September 14, 1993, the Board amended the Plan authorizing additional
available shares of Common Stock. On October 7, 1993, the Board amended and
restated the Plan as stated herein. On April 18, 1994, the Board amended the
Plan authorizing additional available shares of Common Stock, subject to
stockholder approval. On January 20, and April 26, 1995, the Board amended the
Plan authorizing, among other matters, additional available shares of Common
Stock, subject to stockholder approval and the elimination of the stock issuance
portion of the Plan. Any options outstanding under the Plan before this
amendment shall remain valid and unchanged. On April 25, 1997, the Board amended
the Plan authorizing, among other matters, additional available shares of Common
Stock, subject to stockholder approval. On August 18, 2000 the stockholders
approved an amendment to the Plan (which was adopted by the Board on May 5,
2000) to extend its term as set forth in Section 5.3(d) hereof. The Board also
amended the Plan to provide that, following the approval by the stockholders of
the extension of the term of the Plan, Incentive Options could no longer be
granted (see Section 2.2(e)). On October 26, 2001, the Board amended the Plan to
permit the payment of the option exercise price by delivering shares of Common
Stock. On February 11, 2002, the Board amended the Plan to provide that options
granted on or after April 1, 2002 would vest in their entirety upon an
Optionee's death if the Optionee dies while in Service to the Company. On May 6,
2002, the Board amended the Plan to update it to reflect regulatory changes.

          (b) PURPOSE. This 1993 Stock Option Plan, amended through May 6, 2002
("Plan"), is intended to promote the interests of the Corporation by providing
(i) key employees (including officers) of the Corporation (or its parent or
subsidiary corporations) who are responsible for the management, growth and
financial success of the Corporation (or its parent or subsidiary corporations),
(ii) non-employee members of the Corporation's Board of Directors (the "Board")
and (ii) consultants and other independent contractors who provide valuable
services to the Corporation (or its parent or subsidiary corporations) the
opportunity to acquire a proprietary interest, or otherwise increase their
proprietary interest, in the corporation as an incentive for them to remain in
the service of the Corporation (or its parent or subsidiary corporations).

          (c) EFFECTIVE DATE. The Plan became effective on the first date on
which the shares of the Corporation's common stock were registered under Section
12(g) of the Securities Exchange Act of 1934, as amended (the "1934 Act"). Such
date is hereby designated as the Effective Date of the Plan. The effective date
<PAGE>
of any amendments to the Plan shall be as of the date of Board approval or such
other subsequent date as is specified by the Board. Notwithstanding the
foregoing, certain amendments referenced herein must be approved by the
stockholders of the Corporation.

          (d) SUCCESSOR TO 1989 PLAN. This Plan shall serve as the successor to
the Corporation's 1989 Stock Option Plan (the "1989 Plan"), and no further
option grants or stock issuances shall be made under the 1989 Plan from and
after the Effective Date of this Plan. All options outstanding under the 1989
Plan on such Effective Date are hereby incorporated into this Plan and shall
accordingly be treated as outstanding options under this Plan. However, each
outstanding option so incorporated shall continue to be governed solely by the
express terms and conditions of the instrument evidencing such grant, and no
provision of this Plan shall be deemed to affect or otherwise modify the rights
or obligations of the holders of such incorporated options with respect to their
acquisition of shares of the Corporation's common stock thereunder. All
outstanding unvested share issuances under the 1989 Plan shall continue to be
governed solely by the express terms and conditions of the instruments
evidencing such issuances, and no provision of this Plan shall be deemed to
affect or otherwise modify the rights or obligations of the holders of such
unvested shares.

          (e)  PARENT/SUBSIDIARIES.  For  purposes  of the Plan,  the  following
provisions  shall  be  applicable  in  determining  the  parent  and  subsidiary
corporations of the Corporation:

               (i) Any corporation (other than the Corporation) in an unbroken
chain of corporations ending with the Corporation shall be considered to be a
parent of the corporation, provided each such corporation in the unbroken chain
(other than the Corporation) owns, at the time of the determination, stock
possessing fifty percent (50%) or more of the total combined voting power of all
classes of stock in any other corporation in such chain.

               (ii) Each corporation (other than the Corporation) in an unbroken
chain of corporations beginning with the Corporation shall be considered to be a
subsidiary of the Corporation, provided each such corporation (other than the
last corporation) in the unbroken chain owns, at the time of the determination,
stock possessing fifty percent (50%) or more of the total combined voting power
of all classes of stock in any other corporation in such chain.

          (f) All references herein to number of shares of Common Stock have
been restated to reflect a 2-for-1 stock split of the Common Stock effected on
September 14, 1993, a 3-for-2 stock split of the Common Stock effected on April
4, 1994, a 3-for-2 split of the Common Stock effected on November 8, 1994, a
3-for-2 split of the Common Stock effected on January 6, 1997, a 3-for-2 split
of the Common Stock effected on February 7, 2000, a 3-for-2 split of the Common
Stock effected on September 26, 2001 and a 3-for-2 split effected on May 8,
2002.

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     1.2 STRUCTURE OF THE PLAN

          (a) STOCK PROGRAMS. The Plan shall be divided into two separate
components: the Discretionary Option Grant Program specified in Article II and
the Automatic Option Grant Program specified in Article IV. Under the
Discretionary Option Grant Program, eligible individuals may, at the discretion
of the Plan Administrator, be granted options to purchase shares of Common Stock
in accordance with the provisions of Article II. Under the Automatic Option
Grant Program, non-employee members of the Board will be automatically granted
options to purchase shares of the Common Stock in accordance with the provisions
of Article IV.

          (b) GENERAL PROVISIONS. Unless the context clearly indicates
otherwise, the provisions of Articles I and V shall apply to the Discretionary
Option Grant Program and the Automatic Stock Grant Program, and shall
accordingly govern the interests of all individuals under the Plan.

     1.3 ADMINISTRATION OF THE PLAN

          (a) BIFURCATION OF ADMINISTRATION. The eligible persons under the
Discretionary Option Grant Program shall be divided into two groups and there
shall be a separate administrator for each group. One group shall be comprised
of eligible persons that are "Affiliates." For purposes of the Plan, the term
"Affiliates" shall mean (i) all "executive officers" as that term is defined in
Rule 16a-1(f) promulgated under the Securities and Exchange Act of 1934 as
amended (the "1934 Act"), and (ii) all directors of the Company. The other group
shall be comprised of all eligible persons under the Plan that are not
Affiliates ("Non-Affiliates").

          (b) AFFILIATE ADMINISTRATION. The power to administer the
Discretionary Option Grant Program with respect to eligible persons that are
Affiliates shall be vested with a committee (the "Senior Committee") of two (2)
or more non-employee Board members appointed by the Board. No Board member shall
be eligible to serve on the Senior Committee unless such individual qualifies as
both (i) an outside director as defined in Internal Revenue Code Section 162(m)
and the regulations promulgated thereunder, and (ii) a non-employee director as
defined in Rule 16b-3 promulgated under the 1934 Act.

          (c) NON-AFFILIATE ADMINISTRATION. The power to administer the
Discretionary Option Grant Program with respect to eligible persons that are not
Non-Affiliates shall be vested with the Board. The Board, however, may at any
time appoint a committee (the "Employee Committee") of one or more persons who
are members of the Board or members of senior management of the Company and
delegate to such Employee Committee the power, in whole or in part, to
administer the Discretionary Stock Option Grant Program with respect to the
Non-Affiliates.

          (d) TERM ON COMMITTEE. Members of the Senior Committee and the
Employee Committee shall serve for such period of time as the Board may
determine and shall be subject to removal by the Board at any time. The Board at
any time may terminate the functions of the Employee Committee and reassume all
powers and authority previously delegated to such Committee.

                                        3
<PAGE>
          (e) AUTHORITY OF PLAN ADMINISTRATORS. The Board, the Employee
Committee, and the Senior Committee, whichever is applicable, shall each be
referred to herein as a "Plan Administrator." Each Plan Administrator shall have
the authority and discretion, with respect to its administered group, to select
which eligible persons shall participate in the Plan. Unless otherwise required
by law, decisions among members of a Plan Administrator shall be by majority
vote. With respect to each administered group, the applicable Plan Administrator
shall have full power and authority (subject to the express provisions of the
Plan) to establish such rules and regulations as it may deem appropriate for the
proper administration of the Discretionary Option Grant Program and to make such
determinations under, and issue such interpretations of, the provisions of such
programs and any outstanding option grants or stock issuances thereunder as it
may deem necessary or advisable. All decisions made by a Plan Administrator
shall be final and binding on all parties in its administered group who have an
interest in the Discretionary Option Grant Program or any outstanding option
thereunder. The Plan Administrator shall also have full authority to determine,
with respect to the option grants made under the Discretionary Option Program,
the number of shares to be covered by each such grant, the time or times at
which each granted option is to become exercisable and the maximum term for
which the option may remain outstanding.

          (f) INDEMNIFICATION. In addition to such other rights of
indemnification as they may have, the members of each Plan Administrator shall
be indemnified and held harmless by the Company, to the extent permitted under
applicable law, for, from and against all costs and expenses reasonably incurred
by them in connection with any action, legal proceeding to which any such member
thereof may be a party, by reason of any action taken or failed to be taken,
under or in connection with the Plan or any rights granted thereunder, and
against all amounts paid by them in settlement thereof or paid by them in
satisfaction of a judgment of any such action, suit or proceeding, except a
judgment based upon a finding of bad faith.

     1.4 ELIGIBLE PERSONS UNDER THE PLAN

          (a)  DISCRETIONARY  OPTION  GRANT  PROGRAM.  The  persons  eligible to
participate  in the  Discretionary  Option Grant Program under Article II are as
follows:

               (i) officers and other key employees of the Corporation (or its
parent or subsidiary corporations) who render services which contribute to the
management, growth and financial success of the Corporation (or its parent or
subsidiary corporations);

               (ii)  non-employee  members of the Board (excluding those current
members of the Senior Committee); and

               (iii) those consultants or other independent contractors who
provide valuable services to the Corporation (or its parent or subsidiary
corporations).

                                       4
<PAGE>
          (b) AUTOMATIC OPTION GRANT PROGRAM. The persons eligible to
participate in the Automatic Option Grant Program shall be limited to
non-employee Board members. A non-employee Board member shall not be eligible to
participate in the Automatic Option Grant Program, however, if such individual
has at any time been in the prior employ of the Corporation (or any parent or
subsidiary corporation). Unless otherwise provided in the Plan, persons who are
eligible under the Automatic Option Grant Program may also be eligible to
receive option grants under the Discretionary Option Grant Program in effect
under this Plan.

     1.5 STOCK SUBJECT TO THE PLAN(1)

          (a) AMENDMENT. Under the Plan, 20,493,766 shares were originally
authorized to be issued under the Plan (constituting 18,785,173 authorized
shares under the 1989 Plan and rolled over into this Plan plus 1,708,593
additional shares authorized by the Board on January 19, 1993). On April 23,
1993, an additional 7,403,906 shares were authorized by the Board, subject to
stockholder approval at the next stockholders' meeting. At that point, the total
available authorized shares was 27,897,672. On September 14, 1993, the Board
authorized the number of shares of Common Stock issuable under the Plan to be
increased by 7,700,062 shares. On April 18, 1994, the Board authorized the
number of shares of Common Stock issuable under the Plan to be increased by
9,871,875 shares. On January 20, 1995 and April 25, 1997, the Board authorized
the number of shares of Common Stock issuable under the Plan to be increased by
4,809,375 and 6,750,000 shares, respectively, subject to Stockholder approval,
such that the maximum number of shares issuable for the term of the Plan shall
be as set forth in Section 1.5(b) below.

          (b) AVAILABLE SHARES. Shares of the Corporation's common stock (the
"Common Stock") shall be available for issuance under the Plan and shall be
drawn from either the Corporation's authorized but unissued shares of Common
Stock or from reacquired shares of Common Stock, including shares repurchased by
the Corporation on the open market. The maximum number of shares of Common Stock
which may be issued over the term of the Plan shall not exceed 57,028,984
shares, subject to adjustment from time to time in accordance with the
provisions of this Section 1.5. To the extent one or more outstanding options
under the 1989 Plan which have been incorporated into this Plan (as adjusted for
the 1993 Stock Dividend) are subsequently exercised, the number of shares issued
with respect to each such option shall reduce, on a share-for-share basis, the
number of shares available for issuance under this Plan.

          (c) ADJUSTMENTS FOR ISSUANCES. Should one or more outstanding options
under this Plan (including outstanding options under the 1989 Plan incorporated
into this Plan) expire or terminate for any reason prior to exercise in full,
then the shares subject to the portion of each option not so exercised shall be
available for subsequent option grant under the Plan. All share issuances under
the Plan, whether or not the shares are subsequently repurchased by the
Corporation pursuant to its repurchase rights under the Plan, shall reduce on a
share-for-share basis the number of shares of Common Stock available for
subsequent option grants under the Plan. In addition, should the exercise price
of an outstanding option under the Plan (including any option incorporated from

----------
(1) All numbers in Sections 1.5(a), 1.5(b) and 1.5(e) are adjusted for stock
splits which have occurred through May 2002.

                                       5
<PAGE>
the 1989 Plan) be paid with shares of Common Stock or should shares of Common
Stock otherwise issuable under the Plan be withheld by the Corporation in
satisfaction of the withholding taxes incurred in connection with the exercise
of an outstanding option under the Plan, then the number of shares of Common
Stock available for issuance under the Plan shall be reduced by the gross number
of shares for which the option is exercised, and not by the net number of shares
of Common Stock actually issued to the option holder.

          (d) ADJUSTMENTS FOR ORGANIC CHANGES. Should any change be made to the
Common Stock issuable under the Plan by reason of any stock split, stock
dividend, recapitalization, combination of shares, exchange of shares or other
change affecting the outstanding Common Stock as a class without the
Corporation's receipt of consideration, then appropriate adjustments shall be
made to (i) the maximum number and/or class of securities issuable under the
Plan, (ii) the number and/or class of securities and price per share in effect
under each option outstanding under either the Discretionary Option Grant
Program or the Automatic Option Grant Program and (iii) the number and/or class
of securities and price per share in effect under each outstanding option
incorporated into this Plan from the 1989 Plan. Such adjustments to the
outstanding options are to be effected in a manner which shall preclude the
enlargement or dilution of rights and benefits under such options. The
adjustments determined by the Board shall be final, binding and conclusive. The
amount of options granted automatically under the Automatic Option Grant Program
on the Annual Automatic Grant Date and on the Initial Automatic Grant Date shall
not be adjusted regardless of any organic changes made to the Common Stock
issuable under the Plan.

          (e) LIMITATIONS ON GRANTS TO EMPLOYEES. Notwithstanding any other
provision herein to the contrary, the following limitations shall apply to
grants of options to Employees:

               (i) No employee shall be granted, in any fiscal year of the
Corporation, options to purchase more than one million five hundred eighteen
thousand seven hundred and fifty (1,518,750) shares.

               (ii) In connection with his or her initial employment, an
Employee may be granted options to purchase up to an additional two million five
hundred thirty-one thousand two hundred and fifty (2,531,250) shares which shall
not count against the limit set forth in subsection (i) above.

               (iii) The foregoing limitations shall be adjusted proportionately
in connection with any change in the Corporation's capitalization as described
in Section 1.5(d).

               (iv) If an option is cancelled in the same fiscal year of the
Corporation in which such option was granted (other than in connection with a
transaction described in Section 1.5(d)), the cancelled option will be counted
against the limit set forth in Section 1.5(e)(i). For this purpose, if the
exercise price of an option is reduced, the transaction will be treated as a
cancellation of the option and the grant of a new option.

                                       6
<PAGE>
                                   ARTICLE II
                       DISCRETIONARY OPTION GRANT PROGRAM

     2.1 TERMS AND CONDITIONS OF OPTIONS

          (a) GENERAL. Options granted to eligible persons ("Optionees")
pursuant to the Discretionary Option Grant Program set forth in this Article II
shall be authorized by action of the Plan Administrator. Each granted option
shall be evidenced by one or more instruments in the form approved by the Plan
Administrator; provided, however, that each such instrument shall comply with
the terms and conditions specified below.

          (b) OPTION PRICE. The option price per share of the Common Stock
subject to an option hereunder shall in no event be less than one hundred
percent (100%) of the fair market value of such Common Stock on the grant date.

          (c) PAYMENT OF OPTION PRICE. The option price shall become immediately
due upon exercise of the option and shall be payable in one of the following
alternative forms specified below:

               (i) full payment in cash or check made payable to the
Corporation's order; or

               (ii) full payment in shares of Common Stock held for the
requisite period necessary to avoid a charge to the Corporation's earnings for
financial reporting purposes and valued at fair market value on the Exercise
Date (as such term is defined below); or

               (iii) full payment in a combination of shares of Common Stock
held for the requisite period necessary to avoid a charge to the Corporation's
earnings for financial reporting purposes and valued at fair market value on the
Exercise Date and cash or check drawn to the Corporation's order; or

               (iv) full payment through a broker-dealer sale and remittance
procedure pursuant to which the Optionee (A) shall provide irrevocable written
instructions to a designated brokerage firm to effect the immediate sale of the
purchased shares and remit to the Corporation, out of the sale proceeds
available on the settlement date, sufficient funds to cover the aggregate option
price payable for the purchased shares plus all applicable Federal and State
income and employment taxes required to be withheld by the Corporation in
connection with such purchase and shall (B) provide written directives to the
Corporation to deliver the certificates for the purchased shares directly to
such brokerage firm in order to complete the sales transaction.

     For purposes of this Section 2.1(c), the Exercise Date shall be the date on
which written notice of the option exercise is delivered to the Corporation.
Except to the extent the sale and remittance procedure is utilized in connection
with the exercise of the option, payment of the option price for the purchased
shares must accompany such notice.

                                       7
<PAGE>
          (d) FAIR MARKET VALUE. If the Common Stock is traded on any
established stock exchange or a national market system, including without
limitation the Nasdaq National Market or the Nasdaq SmallCap Market, the fair
market value shall be the closing price per share on the date in question, as
such price is reported in the Wall Street Journal or such other source as the
Administrator deems reliable. If there is no reported closing selling price for
the Common Stock on the date in question, then the closing selling price on the
last preceding date for which such quotation exists shall be determinative of
fair market value

          (e) TERM AND EXERCISE OF OPTIONS. Each option granted under this
Discretionary Option Grant Program shall be exercisable at such time or times
and during such period as is determined by the Plan Administrator and set forth
in the instrument evidencing the grant. No such option, however, shall have a
maximum term in excess of ten (10) years from the grant date. Except as
determined otherwise by the Administrator, during the lifetime of the Optionee,
the option shall be exercisable only by the Optionee and shall not be assignable
or transferable by the Optionee other than by will or by the laws of descent and
distribution following the Optionee's death.

          (f) TERMINATION OF SERVICE. The following provisions shall govern the
exercise period applicable to any outstanding options held by the Optionee at
the time of cessation of Service or death:

               (i) Should an Optionee cease Service for any reason (including
permanent disability as defined in Section 22(e)(3) of the Internal Revenue Code
but not including death) while holding one or more outstanding options under
this Article II, then none of those options shall (except to the extent
otherwise provided pursuant to Section 2.1(g) below) remain exercisable for more
than a ninety (90) day period (or such shorter or longer period determined by
the Plan Administrator and set forth in the instrument evidencing the grant, but
not to exceed twelve (12) months) measured from the date of such cessation of
Service.

               (ii) Any option held by the Optionee under this Article II and
exercisable in whole or in part on the date of his or her death may be
subsequently exercised by the personal representative of the Optionee's estate
or by the person or persons to whom the option is transferred pursuant to the
Optionee's will or in accordance with the laws of descent and distribution. With
respect to options granted on or after April 1, 2002, all such unvested options
shall immediately vest upon Optionee's death if such Optionee's death occurs
while Optionee is in Service to the Company. Any exercise following Optionee's
death while Optionee is in Service to the Company, however, must occur prior to
the earlier of (x) six months following the date of Optionee's death or (y) the
specified expiration date of the option term. Upon the occurrence of the earlier
event, the option shall terminate and cease to be outstanding.

               (iii) Under no circumstances, however, shall any such option be
exercisable after the specified expiration date of the option term.

               (iv) During the applicable post-Service exercise period, the
option shall not be exercisable for more than the number of shares (if any) in
which the Optionee is vested at the time of his or her cessation of Service
(less any option shares subsequently purchased by the Optionee prior to death).

                                       8
<PAGE>
Upon the expiration of the limited post-Service exercise period or (if earlier)
upon the specified expiration date of the option term, each such option shall
terminate and cease to be outstanding with respect to any vested shares for
which the option has not otherwise been exercised. However, each outstanding
option shall immediately terminate and cease to be outstanding, at the time of
the Optionee's cessation of Service, with respect to any shares for which the
option is not otherwise at that time exercisable or in which the Optionee is not
otherwise at that time vested.

               (v) Should (A) the Optionee's service be terminated for
misconduct (including, but not limited to, any act of dishonesty, willful
misconduct, fraud or embezzlement) or (B) the Optionee make any unauthorized use
or disclosure of confidential information or trade secrets of the Corporation or
its parent or subsidiary corporations, then in any such event all outstanding
options held by the Optionee under this Article II shall terminate immediately
and cease to be outstanding.

          (g) DISCRETION TO ACCELERATE VESTING. The Plan Administrator shall
have complete discretion, exercisable either at the time the option is granted
or at any time while the option remains outstanding, to permit one or more
options held by the Optionee under this Article II to be exercised, during the
limited post-Service exercise period applicable under Section 2.1(f) above, not
only with respect to the number of vested shares of Common Stock for which each
such option is exercisable at the time of the Optionee's cessation of Service
but also with respect to one or more subsequent installments of vested shares
for which the option would otherwise have become exercisable had such cessation
of Service not occurred.

          (h) DISCRETION TO EXTEND EXERCISE PERIOD. The Plan Administrator shall
also have full power and authority to extend the period of time for which the
option is to remain exercisable following the Optionee's cessation of Service or
death from the limited period in effect under Section 2.1(f) above to such
greater period of time as the Plan Administrator shall deem appropriate. In no
event, however, shall such option be exercisable after the specified expiration
date of the option term.

          (i) DEFINITIONS. For purposes of the foregoing provisions of this
Section 2.1 (and for all other purposes under the Discretionary Option Grant
Program):

               (i) The Optionee shall (except to the extent otherwise
specifically provided in the applicable stock option agreement) be deemed to
remain in SERVICE for so long as such individual renders services on a periodic
basis to the Corporation (or any parent or subsidiary corporation) in the
capacity of an Employee, a non-employee member of the Board or an independent
consultant or advisor.

               (ii) The Optionee shall be considered to be an EMPLOYEE for so
long as he or she remains in the employ of the Corporation or one or more parent
or subsidiary corporations, subject to the control and direction of the employer
entity not only as to the work to be performed but also as to the manner and
method of performance.

                                       9
<PAGE>
          (j) STOCKHOLDER RIGHTS. An Optionee shall have no stockholder rights
with respect to any shares covered by the option until such individual shall
have exercised the option and paid the option price for the purchased shares.

     2.2 INCENTIVE OPTIONS

     From and after August 18, 2000, no incentive stock options, as defined in
Section 422 of the Internal Revenue Code, shall be granted under the Plan.

     2.3 CORPORATE TRANSACTIONS

          (a) DEFINITION. For purposes of this Plan, any of the following
stockholder approved transactions to which the Corporation is a party shall be
considered a "Corporate Transaction":

               (i) a merger or consolidation in which the corporation is not the
surviving entity, except for a transaction the principal purpose of which is to
change the State in which the Corporation is incorporated,

               (ii) the sale, transfer or other disposition of all or
substantially all of the assets of the Corporation in complete liquidation or
dissolution of the Corporation, or

               (iii) any reverse merger in which the Corporation is the
surviving entity but in which securities possessing more than fifty percent
(50%) of the total combined voting power of the Corporation's outstanding
securities are transferred to person or persons different from those who held
such securities immediately prior to such merger.

          (b) ACCELERATION OF OPTION. Upon the stockholder approval of a
Corporate Transaction, each option which is at the time outstanding under this
Article II shall automatically accelerate so that each such option shall,
immediately prior to the specified effective date for the Corporate Transaction,
become fully exercisable with respect to the total number of shares of Common
Stock at the time subject to such option and may be exercised for all or any
portion of such shares. However, an outstanding option under this Article II
shall not so accelerate if and to the extent: (A) such option is, in connection
with the Corporate Transaction, either to be assumed by the successor
corporation or parent thereof or to be replaced with a comparable option to
purchase shares of the capital stock of the successor corporation or parent
thereof, (B) such option is to be replaced with a cash incentive program of the
successor corporation which preserves the option spread existing at the time of
the Corporate Transaction and provides for subsequent payout in accordance with
the same vesting schedule applicable to such option, or (C) the acceleration of
such option is subject to other limitations imposed by the Plan Administrator at
the time of the option grant. The determination of option comparability under
clause (A) above shall be made by the Plan Administrator, and its determination
shall be final, binding and conclusive.

                                       10
<PAGE>
          (c) TERMINATION OF OPTIONS. Upon the consummation of the Corporate
Transaction, all outstanding options under this Article II shall terminate and
cease to be outstanding, except to the extent assumed by the successor
corporation or its parent company.

          (d) ADJUSTMENTS ON ASSUMPTION OR CONTINUATION. Each outstanding option
under this Article II which is assumed in connection with the Corporate
Transaction or is otherwise to continue in effect shall be appropriately
adjusted, immediately after such Corporate Transaction, to apply and pertain to
the number and class of securities which would have been issued to the option
holder, in consummation of such Corporate Transaction, had such person exercised
the option immediately prior to such Corporate Transaction. Appropriate
adjustments shall also be made to the option price payable per share, provided
the aggregate option price payable for such securities shall remain the same. In
addition, the class and number of securities available for issuance under the
Plan following the consummation of the Corporate Transaction shall be
appropriately adjusted.

          (e) DISCRETION TO ACCELERATE. The Plan Administrator shall have the
discretion, exercisable either in advance of any actually-anticipated Corporate
Transaction or at the time of an actual Corporate Transaction, to provide (upon
such terms as it may deem appropriate) for the automatic acceleration of one or
more outstanding options granted under the Plan which are assumed or replaced in
the Corporate Transaction and do not otherwise accelerate at that time, in the
event the Optionee's Service should subsequently terminate within a designated
period following the effective date of such Corporate Transaction.

          (f) PLAN NOT TO AFFECT CORPORATION. The grant of options under this
Article II shall in no way affect the right of the Corporation to adjust,
reclassify, reorganize or otherwise change its capital or business structure or
to merge, consolidate, dissolve, liquidate or sell or transfer all or any part
of its business or assets.

                                       11
<PAGE>
     2.4 CHANGE IN CONTROL

          (a) DEFINITION. For purposes of this Plan, a Change in Control shall
be deemed to occur in the event:

               (i) any person or related group of persons (other than the
Corporation or a person that directly or indirectly controls, is controlled by,
or is under common control with, the Corporation) directly or indirectly
acquires beneficial ownership (within the meaning of Rule 13d-3 of the 1934 Act)
of securities possessing more than fifty percent (50%) of the total combined
voting power of the Corporation's outstanding securities pursuant to a tender or
exchange offer made directly to the Corporation's stockholders which the Board
does not recommend such stockholders to accept; or

               (ii) there is a change in the composition of the Board over a
period of twenty-four (24) consecutive months or less such that a majority of
the Board members (rounded up to the next whole number) ceases, by reason of one
or more proxy contests for the election of Board members, to be comprised of
individuals who either (a) have been Board members continuously since the
beginning of such period or (b) have been elected or nominated for election as
Board members during such period by at least a majority of the Board members
described in clause (a) who were still in office at the time such election or
nomination was approved by the Board.

          (b) DISCRETION TO ACCELERATE. The Plan Administrator shall have the
discretionary authority, exercisable either in advance of any actually
anticipated Change in Control or at the time of an actual Change in Control, to
provide for the automatic acceleration of one or more outstanding options under
this Article II (and the termination of one or more of the Corporation's
outstanding repurchase rights under this Article II) upon the occurrence of the
Change in Control. The Plan Administrator shall also have full power and
authority to condition any such option acceleration (and the termination of any
outstanding repurchase rights) upon the subsequent termination of the Optionee's
Service within a specified period following the Change in Control.

          (c) EXERCISE RIGHTS. Any options accelerated in connection with the
Change in Control shall remain fully exercisable until the expiration or sooner
termination of the option term.

     2.5 INCENTIVE OPTIONS

          The exercisability as Incentive Options of any options accelerated
under Sections 2.3 or 2.4 hereof in connection with a Corporate Transaction or
Change in Control shall remain subject to the dollar limitation of Section
422(d) of the Internal Revenue Code.

                                       12
<PAGE>
                                   ARTICLE III
                                    RESERVED

                                   ARTICLE IV
                         AUTOMATIC OPTION GRANT PROGRAM

     4.1 TERMS AND CONDITIONS OF AUTOMATIC OPTION GRANTS

          (a) AMOUNT AND DATE OF GRANT. During the term of this Plan, automatic
option grants (the "Automatic Option Grant") shall be made to each eligible
non-employee member of the Board ("Optionee") as follows:

               (i) Each year on the Annual Automatic Grant Date an option to
acquire 5,000 shares of Common Stock ("Option Shares") shall be granted to each
eligible non-employee member of the Board for so long as there are shares of
Common Stock available under Section 1.5 hereof. The "Annual Automatic Grant
Date" shall be as of the first business day of the month in which the
Corporation's Annual Stockholders Meeting is held. Notwithstanding the
foregoing, (1) any non-Employee Member of the Board whose term ended as of such
Automatic Grant Date shall not be eligible to receive any automatic option
grants on that Annual Automatic Grant Date and (2) any non-Employee Member of
the Board who has received an Automatic Grant pursuant to Section 4.1(a)(ii) on
the same date as the Annual Automatic Grant Date or within 30 days prior
thereto, shall not be eligible to receive an Automatic Option Grant on that
Annual Automatic Grant Date.

               (ii) On the Initial Automatic Grant Date, every new member of the
Board who is an eligible non-Employee and has not previously been a member of
the Board shall be granted an option to acquire 10,000 shares of Common Stock
("Option Shares") as long as there are shares of Common Stock available under
Section 1.5 hereof. The "Initial Automatic Grant Date" shall be as of the date
that the Optionee was first appointed or elected to the Board.

          (b) EXERCISE PRICE. The exercise price per share of Common Stock
subject to each automatic option grant made under this Article IV shall be equal
to 100% of the fair market value per share of the Common Stock on the applicable
Automatic Grant Date, as determined in accordance with the valuation provisions
of Section 2.1(d) hereof.

          (c) METHOD OF EXERCISE. In order to exercise an option with respect to
any Option Shares for which an Automatic Option Grant is exercisable at the
time, Optionee (or in the case of an exercise after Optionee's death, Optionee's
executor, administrator, heir or legatee, as the case may be) must take the
following action:

                                       13
<PAGE>
               (i) execute and deliver to the Secretary of the Company a written
notice of exercise;

               (ii) pay the aggregate Option Price in one of the alternate forms
as set forth in Section 4.1(d) below; and

               (iii) furnish appropriate documentation that the person or
persons exercising the option (if other than the Optionee) has the right to
exercise such option. As soon after the Exercise Date (as defined in Section
4.1(e) hereof), as practical, the Company shall mail or deliver to or on behalf
of the Optionee (or any other person or persons exercising this option in
accordance herewith) a certificate or certificates representing the shares for
which the option has been exercised in accordance with the provisions of this
Plan. In no event may any option be exercised for any fractional shares.

          (d) PAYMENT PRICE. The exercise price shall be payable in one of the
alternative forms specified below:

               (i) full payment in cash or check made payable to the
Corporation's order; or

               (ii) full payment in shares of Common Stock held for the
requisite period necessary to avoid a charge to the Corporation's earnings for
financial reporting purposes and valued at fair market value on the Exercise
Date (as such term is defined below); or

               (iii) full payment in a combination of shares of Common Stock
held for the requisite period necessary to avoid a charge to the Corporation's
earnings for financial reporting purposes and valued at fair market value on the
Exercise Date and cash or check drawn to the Corporation's order; or

               (iv) full payment through a sale and remittance procedure
pursuant to which the non-employee Board member (A) shall provide irrevocable
written instructions to a designated brokerage firm to effect the immediate sale
of the purchased shares and remit to the Corporation, out of the sale proceeds
available on the settlement date, sufficient funds to cover the aggregate
exercise price payable for the purchased shares and shall (B) concurrently
provide written directives to the Corporation to deliver the certificates for
the purchased shares directly to such brokerage firm in order to complete the
sales transaction.

     For purposes of this Section 4.1.(d), the Exercise Date shall be the date
on which written notice of the option exercise is delivered to the Corporation.
Except to the extent the sale and remittance procedure is utilized in connection
with the exercise of the option, payment of the exercise price for the purchased
shares must accompany such notice.

          (e) EXERCISE DATE. For purposes of this Article IV, the Exercise Date
shall be the date on which written notice of the option exercise is delivered to
the Corporation, and the fair market value per share of Common Stock on any
relevant date under this Article IV shall be determined in accordance with the
provisions of Section 2.1(d) hereof. Except to the extent the sale and

                                       14
<PAGE>
remittance procedure specified above is utilized for the exercise of the potion,
payment of the option price for the purchased shares must accompany the exercise
notice.

          (f) TERM OF OPTION. Each Automatic Option Grant under this Article IV
shall have a maximum term of ten (10) years measured from the Automatic Grant
Date. Should Optionee's service as a Board member cease for any reason while an
option remains outstanding and unexercised, then the option term shall
immediately terminate and the option shall cease to be outstanding prior to the
Expiration Date in accordance with the following provisions:

               (i) The option shall immediately terminate and cease to be
outstanding for any shares of Common Stock for which the option was not
otherwise exercisable at the time of Optionee's cessation of Board service.

               (ii) Should Optionee cease, for any reason other than death, to
serve as a member of the Board, then Optionee shall have a six-month period
measured from the date of such cessation of Board service in which to exercise
the options which vested prior to the time of such cessation of Board service.
In no event, however, may any option be exercised after the Expiration Date of
such option.

               (iii) With respect to options granted on or after April 1, 2002,
all such unvested options shall immediately vest upon the Optionee's death if
said Optionee's death occurs during Optionee's Board service. Should Optionee
die while serving as a Board member or within six months after cessation of
Board service, then the personal representative of the Optionee's estate (or the
person or persons to whom the option is transferred pursuant to the Optionee's
will or in accordance with the laws of descent and distribution) shall have the
right to exercise any option for any or all of the shares of Common Stock for
which the option is, in accordance with the provisions of this Plan, exercisable
at the time of the Optionee's cessation of Board service, less any shares
subsequently purchased by the Optionee pursuant to the option prior to death.
Such right shall cease to be exercisable and the option shall accordingly
terminate with respect to all Common Stock available under such option by the
earlier of (A) the expiration of the twelve-month period measured from the date
of Optionee's death or (B) the Expiration Date.

          (g) VESTING. Each Automatic Option Grant made pursuant to Section
4.1(a)(i) shall become exercisable and vest in a series of twelve (12) equal and
successive monthly installments, with the first such installment to become
exercisable one month after the Annual Automatic Grant Date. Each Automatic
Option Grant made pursuant to Section 4.1(a)(ii) shall become exercisable and
vest in a series of 36 equal and successive monthly installments, with the first
such installment to become exercisable one month after the Initial Automatic
Grant Date. Each installment of an option shall only vest and become exercisable
if the Optionee has not ceased serving as a Board member as of such installment
date.

          (h) LIMITED TRANSFERABILITY. Except as otherwise determined by the
Adminstrator, each Automatic Option Grant shall be exercisable only by Optionee
during Optionee's lifetime and shall be neither transferable nor assignable,
other than by will or by the laws of descent and distribution following
Optionee's death.

                                       15
<PAGE>
     4.2 CORPORATE TRANSACTION

     In the event of stockholder approval of a Corporate Transaction (as that
term is defined in Section 2.3(a)), then all options granted pursuant to this
Article IV (to the extent outstanding at such time, but not otherwise fully
exercisable and vested) shall automatically accelerate and immediately vest so
that the option shall, immediately prior to the specified effective date for the
Corporate Transaction, become fully exercisable for all of the Option Shares at
the time subject to the option and may thereafter be exercised for any or all
such Option Shares. Upon the consummation of the Corporate Transaction, the
option shall, to the extent not previously exercised, terminate and cease to be
outstanding.

     4.3 CHANGE IN CONTROL

     All options granted pursuant to an Automatic Option Agreement under this
Article IV (to the extent outstanding, but not otherwise fully exercisable and
vested) shall automatically accelerate in connection with a Change in Control
(as that term is defined in Section 2.4(a)), so that such option shall,
immediately prior to the effective date of such Change in Control, become fully
exercisable for all of the Option Shares at the time subject to that option and
may be exercised for any or all of such Option Shares. The option shall remain
so exercisable until such option has terminated in accordance with Section
4.1(d) hereof.

     4.4 MISCELLANEOUS PROVISIONS

          (a) CORPORATION RIGHTS. The Automatic Option Grants shall in no way
affect the right of the Corporation to adjust, reclassify, reorganize or
otherwise change its capital or business structure or to merge, consolidate,
dissolve, liquidate or sell or transfer all or any part of its business or
assets.

          (b) PRIVILEGE OF STOCK OWNERSHIP. An Optionee shall not have any of
the rights of a stockholder with respect to Option Shares until such individual
shall have exercised the option and paid the option price for the Option Shares.

                                       16
<PAGE>
                                    ARTICLE V
                                  MISCELLANEOUS

     5.1 AMENDMENT OF THE PLAN AND AWARDS

          (a) BOARD AUTHORITY. The Board has complete and exclusive power and
authority to amend or modify the Plan (or any component thereof) in any or all
respects whatsoever. However, no such amendment or modification shall, without
the consent of the Corporation's stockholders, disqualify any option previously
granted under the Plan for treatment as an Incentive Option, or adversely affect
rights and obligations with respect to options at the time outstanding under the
Plan, unless the Optionee or Participant consents to such amendment. In
addition, the Board may not, without the approval of the Corporation's
stockholders, amend the Plan to (i) materially increase the maximum number of
shares issuable under the Plan, except for permissible adjustments under Section
1.5(d) or extend the term of the Plan, (ii) materially modify the eligibility
requirements for plan participation or (iii) materially increase the benefits
accruing to plan participants.

          (b) OPTIONS ISSUED PRIOR TO STOCKHOLDER APPROVAL. Options to purchase
shares of Common Stock may be granted under the Discretionary Option Grant
Program and the Automatic Option Grant Program prior to any required stockholder
approvals, provided, any shares actually issued under the Plan are held in
escrow until stockholder approval is obtained. If such stockholder approval is
not obtained within twelve (12) months of the meeting of the Board approving the
Plan or any amendments, then (i) any unexercised options shall terminate and
cease to be exercisable and (ii) the Corporation shall promptly refund the
purchase price paid for any excess shares actually issued under the Plan and
held in escrow, together with interest (at the applicable Short Term Federal
Rate) for the period the shares were held in escrow.

          (c) RULE 16b-3 PLAN. With respect to persons subject to Section 16 of
the 1934 Act, the Plan is intended to comply with all applicable conditions of
Rule 16b-3 (and all subsequent revisions thereof) promulgated under the 1934
Act. To the extent any revision of the Plan or action by any Plan Administrator
fails to so comply, it shall be deemed null and void, to the extent permitted by
law and deemed advisable by such Plan Administrator. In addition, the Board may
amend the Plan from time to time as it deems necessary in order to meet the
requirements of any amendments to Rule 16b-3 without the consent of the
shareholders of the Company.

     5.2 TAX WITHHOLDING

          (a) GENERAL. The Corporation's obligation to deliver shares of Common
Stock upon the exercise of stock options for such shares or the vesting of such
shares under the Plan shall be subject to the satisfaction of all applicable
Federal, State and local income tax and employment tax withholding requirements.

          (b) SHARES TO PAY FOR WITHHOLDING. A Plan Administrator may, in its
discretion and in accordance with the provisions of this Section 5.2(b) and such
supplemental rules as the Plan Administrator may from time to time adopt

                                       17
<PAGE>
(including the applicable safe-harbor provisions of SEC Rule 16b-3), provide any
or all holders of non-statutory options or unvested shares under the Plan with
the right to use shares of the Corporation's Common Stock in satisfaction of all
or part of the Federal, State and local income tax and employment tax
liabilities incurred by such holders in connection with the exercise of their
options or the vesting of their shares (the "Taxes"). Such right may be provided
to any such holder in either or both of the following formats:

               (i) STOCK WITHHOLDING. The holder of the non-statutory option or
unvested shares may be provided with the election to have the Corporation
withhold, from the shares of Common Stock otherwise issuable upon the exercise
of such non-statutory option or the vesting of such shares, a portion of those
shares with an aggregate fair market value equal to the percentage of the
applicable Taxes (not to exceed one hundred percent (100%)) designated by the
holder.

               (ii) STOCK DELIVERY. The Plan Administrator may, in its
discretion, provide the holder of the non-statutory option or the unvested
shares with the election to deliver to the Corporation, at the time the
non-statutory option is exercised or the shares vest, one or more shares of
Common Stock previously acquired by such individual (other than pursuant to the
transaction triggering the Taxes) with an aggregate fair market value equal to
the percentage of the taxes incurred in connection with such option exercise or
share vesting (not to exceed one hundred percent (100%)) designated by the
holder.

     5.3 EFFECTIVE DATE AND TERM OF PLAN

          (a) EFFECTIVE DATE. This Plan, as successor to the Corporation's 1989
Stock Option Plan, become effective as of the applicable Effective Date, and no
further option grants or stock issuances shall be made under the 1989 Plan from
and after such Effective Date.

          (b) INCORPORATION OF 1989 PLAN. Each option issued and outstanding
under the 1989 Plan immediately prior to the Effective Date of the Discretionary
Option Grant Program shall be incorporated into this Plan and treated as an
outstanding option under this Plan, but each such option shall continue to be
governed solely by the terms and conditions of the instrument evidencing such
grant, and nothing in this Plan shall be deemed to affect or otherwise modify
the rights or obligations of the holders of such options with respect to their
acquisition of shares of Common Stock thereunder.

          (c) DISCRETION. The option and vesting acceleration provisions of
Article II relating to Corporate Transactions and Changes in Control may, in the
Plan Administrator's discretion, be extended to one or more stock options which
are outstanding under the 1989 Plan on the Effective Date of the Discretionary
Option Grant Program but which do not otherwise provide for such acceleration.

                                       18
<PAGE>
          (d) TERMINATION OF PLAN. The Plan shall terminate upon the earlier of
(i) January 19, 2013(2) or (ii) the date on which all shares available for
issuance under the Plan shall have been issued pursuant to the exercise of
options granted under the Plan. If the date of termination is determined under
clause (i) above, then all option grants and unvested stock issuances
outstanding on such date shall thereafter continue to have force and effect in
accordance with the provisions of the instruments evidencing such grants or
issuances.

     5.4 USE OF PROCEEDS

     Any cash proceeds received by the Corporation from the sale of shares
pursuant to option grants under the Plan shall be used for general corporate
purposes.

     5.5 REGULATORY APPROVALS

          (a) GENERAL. The implementation of the Plan, the granting of any
option under the Plan, and the issuance of Common Stock upon the exercise or
surrender of the option grants made hereunder shall be subject to the
Corporation's procurement of all approvals and permits required by regulatory
authorities having jurisdiction over the Plan, the options granted under it, and
the Common Stock issued pursuant to it.

          (b) SECURITIES REGISTRATION. No shares of Common Stock or other assets
shall be issued or delivered under this Plan unless and until there shall have
been compliance with all applicable requirements of Federal and State securities
laws, including the filing and effectiveness of the Form S-8 registration
statement for the shares of Common Stock issuable under the Plan, and all
applicable listing requirements of any securities exchange on which stock of the
same class is then listed.

     5.6 NO EMPLOYMENT/SERVICE RIGHTS

     Neither the action of the Corporation in establishing the Plan, nor any
action taken by the Plan Administrator hereunder, nor any provision of the Plan
shall be construed so as to grant any individual the right to remain in the
employ or service of the Corporation (or any parent or subsidiary corporation)
for any period of specific duration, and the Corporation (or any parent or
subsidiary corporation retaining the services of such individual) may terminate
such individual's employment or service at any time and for any reason, with or
without cause.

     5.7 MISCELLANEOUS PROVISIONS

          (a) ASSIGNMENT. The right to acquire Common Stock or other assets
under the Plan may not be assigned, encumbered or otherwise transferred by any
Optionee or Participant. The provisions of the Plan shall inure to the benefit
of, and be binding upon, the Corporation and its successors or assigns, whether
by Corporate Transaction or otherwise, and the Participants and Optionees, the

----------
(2) By amendment approved by the stockholders on August 18, 2000, the term of
the Plan was extended from January 19, 2003 to January 19, 2013.

                                       19
<PAGE>
legal representatives of their respective estates, their respective heirs or
legatees and their permitted assignees.

          (b) CHOICE OF LAW. The provisions of the Plan relating to the exercise
of options and the vesting of shares shall be governed by the laws of the State
of Arizona, as such laws are applied to contracts entered into and performed in
such State.

          (c) PLAN NOT EXCLUSIVE. This Plan is not intended to be the exclusive
means by which the Corporation may issue options or warrants to acquire its
shares of Common Stock, stock awards or issuances, or any other type of award or
issuance. To the extent permitted by applicable law, any such other option,
warrants, issuance, or awards may be issued by the Company, other than pursuant
to this Plan, without shareholder approval.

     EXECUTED as of the 6th day of May, 2002.

                                       MICROCHIP TECHNOLOGY INCORPORATED,
                                       a Delaware corporation

                                       By: /s/ Steve Sanghi
                                           -------------------------------------
                                           Steve Sanghi

                                           Its: Chairman of the Board, President
                                           and Chief Executive Officer

Attested by:

/s/ Mary K. Simmons
----------------------------------
Mary K. Simmons, Secretary

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