Document:

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February 9, 2000

The Board of Directors
Digital Star Inc.
Unit 1806, Hutchison House
10 Harcourt Road
Central
Hong Kong

Dear Sirs,

As independent public accountants, we hereby consent to the incorporation by
reference in this Form 20-F of our report dated October 25, 1999 included in
the Registration Statement. It should be noted that we have not audited any
financial statements of the Company subsequent to September 30, 1999 or
performed any audit procedures subsequent to the date of our report.

Very truly yours,

/s/ Arthur Andersen & Co.
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                                                                    EXHIBIT 4.1

                                  CADABRA INC.

                 (FORMERLY TESSERAE INFORMATION SYSTEMS, INC. )

                             1998 STOCK OPTION PLAN

              AS ADOPTED JANUARY 21, 1998 AND AMENDED MARCH 1, 1999

                  1. PURPOSE. The purpose of this Plan is to provide incentives
to attract, retain and motivate eligible persons whose present and potential
contributions are important to the success of the Company, its Parent and
Subsidiaries, by offering them an opportunity to participate in the Company's
future performance through awards of Options. Capitalized terms not defined in
the text are defined in Section 21 hereof. This Plan is intended to be a written
compensatory benefit plan within the meaning of Rule 701 promulgated under the
Securities Act.

                  2. SHARES SUBJECT TO THE PLAN.

                           2.1 Number of Shares Available. Subject to Sections
2.2 and 16 hereof, the total number of Shares reserved and available for grant
and issuance pursuant to this Plan will be 2,750,000 Shares or such lesser
number of Shares as permitted under Section 260.140.45 of Title 10 of the
California Code of Regulations. Subject to Sections 2.2 and 16 hereof, Shares
that are subject to issuance upon exercise of an Option but cease to be subject
to such Option for any reason other than exercise of such Option will be
available for grant and issuance in connection with future Options under this
Plan. At all times the Company will reserve and keep available a sufficient
number of Shares as will be required to satisfy the requirements of all
outstanding Options granted under this Plan.

                           2.2 Adjustment of Shares. In the event that the
number of outstanding shares of the Company's Common Stock is changed by a stock
dividend, recapitalization, stock split, reverse stock split, subdivision,
combination, reclassification or similar change in the capital structure of the
Company without consideration, then (a) the number of Shares reserved for
issuance under this Plan and (b) the Exercise Prices of and number of Shares
subject to outstanding Options, will be proportionately adjusted, subject to any
required action by the Board or the shareholders of the Company and compliance
with applicable securities laws; provided, however, that fractions of a Share
will not be issued but will either be paid in cash at the Fair Market Value of
such fraction of a Share or will be rounded down to the nearest whole Share, as
determined by the Committee in its discretion.

                  3. ELIGIBILITY. ISOs (as defined in Section 5 hereof) may be
granted only to employees (including officers and directors who are also
employees) of the Company or of a Parent or Subsidiary of the Company. NQSOs (as
defined in Section 5 hereof) may be granted to employees, officers, directors
and consultants of the Company

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or of any Parent or Subsidiary of the Company; provided such consultants render
bona fide services not in connection with the offer and sale of securities in a
capital-raising transaction. A person may be granted more than one Option under
this Plan.

                  4.       ADMINISTRATION.

                           4.1 Committee Authority. This Plan will be
administered by the Committee or the Board acting as the Committee. Subject to
the general purposes, terms and conditions of this Plan, and to the direction of
the Board, the Committee has full power to implement and carry out this Plan.
Without limitation, the Committee has the authority to:

                  (a)      construe and interpret this Plan, any Stock Option
                           Agreement or Exercise Agreement (each as defined in
                           Section 5 hereof) and any other agreement or document
                           executed pursuant to this Plan;

                           (b)      prescribe, amend and rescind rules and
                                    regulations relating to this Plan;

                           (c)      select persons to receive Options;

                           (d)      determine the form and terms of Options;

                           (e)      determine the number of Shares or other
                                    consideration subject to Options;

                  (f)      determine whether Options will be granted singly, in
                           combination with, in tandem with, in replacement of,
                           or as alternatives to, any Options granted under this
                           Plan or any awards under any other incentive or
                           compensation plan of the Company or any Parent or
                           Subsidiary of the Company;

                           (g)      grant waivers of Plan or Option conditions;

                           (h)      determine the vesting and exercisability of
                                    Options;

                  (i)      correct any defect, supply any omission, or reconcile
                           any inconsistency in this Plan, any Option or any
                           Stock Option Agreement or Exercise Agreement (each as
                           defined in Section 5 hereof);

                           (j)      determine whether an Option has been earned;
                                    and

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                           (k) make all other determinations necessary or
advisable for the administration of this Plan.

                           4.2 Committee Discretion. Any determination made by
the Committee with respect to any Option will be made in its sole discretion at
the time of grant of the Option or, unless in contravention of any express term
of this Plan or Option, and subject to Section 5.9 hereof, at any later time,
and such determination will be final and binding on the Company and on all
persons having an interest in any Option under this Plan. The Committee may
delegate to one or more officers of the Company the authority to grant Options
under this Plan.

                  5. OPTIONS. The Committee may grant Options to eligible
persons and will determine whether such Options will be Incentive Stock Options
within the meaning of the Code ("ISOS") or Nonqualified Stock Options ("NQSOS"),
the number of Shares subject to the Option, the Exercise Price of the Option,
the period during which the Option may be exercised, and all other terms and
conditions of the Option, subject to the following:

                           5.1 Form of Option Grant. Each Option granted under
this Plan will be evidenced by an Agreement which will expressly identify the
Option as an ISO or an NQSO ("STOCK OPTION AGREEMENT"), and will be in such form
and contain such provisions (which need not be the same for each Participant) as
the Committee may from time to time approve, and which will comply with and be
subject to the terms and conditions of this Plan.

                           5.2 Date of Grant. The date of grant of an Option
will be the date on which the Committee makes the determination to grant such
Option, unless otherwise specified by the Committee. The Stock Option Agreement
and a copy of this Plan will be delivered to the Participant within a reasonable
time after the granting of the Option.

                           5.3 Exercise Period. Options may be exercisable
immediately (subject to repurchase pursuant to Section 10 hereof) or may be
exercisable within the times or upon the events determined by the Committee as
set forth in the Stock Option Agreement governing such Option; provided,
however, that no Option will be exercisable after the expiration of ten (10)
years from the date the Option is granted; and provided further that no ISO
granted to a person who directly or by attribution owns more than ten percent
(10%) of the total combined voting power of all classes of stock of the Company
or of any Parent or Subsidiary of the Company ("TEN PERCENT SHAREHOLDER") will
be exercisable after the expiration of five (5) years from the date the ISO is
granted. The Committee may provide for Options to become exercisable at one time
or from time to time, periodically or otherwise, in such number of Shares or
percentage of Shares as the Committee determines. Subject to earlier termination
of the Option as provided herein, each Participant who is not an officer,
director or consultant of the Company or of a Parent or Subsidiary of the
Company shall have the right to exercise an Option granted hereunder at the rate
of at least twenty percent (20%) per year over five (5) years from the date such
Option is granted.

                           5.4 Exercise Price. The Exercise Price of an Option
will be determined by the Committee when the Option is granted and may not be
less than eighty five percent (85%) of the Fair Market Value of the Shares on
the date of grant; provided that (a) the Exercise Price of an ISO will not be
less than one hundred percent (100%) of the Fair Market Value of the Shares on
the date of grant and (b) the Exercise Price of any Option granted to a Ten
Percent Shareholder will not be less than one hundred ten percent (110%) of the
Fair Market Value of the Shares on the date of grant. Payment for the Shares
purchased must be made in accordance with Section 6 hereof.

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                           5.5 Method of Exercise. Options may be exercised only
by delivery to the Company of a written stock option exercise agreement (the
"EXERCISE AGREEMENT") in a form approved by the Committee (which need not be the
same for each Participant), stating the number of Shares being purchased, the
restrictions imposed on the Shares purchased under such Exercise Agreement, if
any, and such representations and agreements regarding Participant's investment
intent and access to information and other matters, if any, as may be required
or desirable by the Company to comply with applicable securities laws, together
with payment in full of the Exercise Price, and any applicable taxes, for the
number of Shares being purchased.

                           5.6 Termination. Subject to earlier termination
pursuant to Sections 16 or 17 hereof and notwithstanding the exercise periods
set forth in the Stock Option Agreement, exercise of an Option will always be
subject to the following:

                  (a)      If the Participant is Terminated for any reason
                           except death, Disability or Cause, then the
                           Participant may exercise such Participant's Options,
                           only to the extent that such Options are exercisable
                           on the Termination Date and such Options must be
                           exercised by the Participant, if at all, as to all or
                           some of the Vested Shares calculated as of the
                           Termination Date, within three (3) months after the
                           Termination Date (or within such shorter time period,
                           not less than thirty (30) days after the Termination
                           Date, or such longer time period not exceeding five
                           (5) years after the Termination Date as may be
                           determined by the Committee, with any exercise after
                           three (3) months after the Termination Date deemed to
                           be an NQSO), but in any event, no later than the
                           expiration date of the Options.

                  (b)      If the Participant is Terminated because of
                           Participant's death or Disability (or the Participant
                           dies within three (3) months after Participant's
                           Termination other than for Cause), then Participant's
                           Options may be exercised, only to the extent that
                           such Options are exercisable by Participant on the
                           Termination Date and must be exercised by Participant
                           (or Participant's legal representative or authorized
                           assignee), if at all, as to all or some of the Vested
                           Shares calculated as of the Termination Date, within
                           twelve (12) months after the Termination Date (or
                           within such shorter time period, not less than six
                           (6) months after the Termination Date, or such longer
                           time period not exceeding five (5) years after the
                           Termination Date as may be determined by the
                           Committee, with any exercise after (i) three (3)
                           months after the Termination Date when the
                           Termination is for any reason other than the
                           Participant's death or disability, within the meaning
                           of Code Section 22(e)(3), or (ii) twelve (12) months
                           after the Termination Date when the Termination is
                           because of Participant's disability, within the
                           meaning of Code Section 22(e)(3), deemed to be an
                           NQSO), but in any event no later than the expiration
                           date of the Options.

                  (c)      If the Participant is terminated for Cause, then
                           Participant's Options shall expire on such
                           Participant's Termination Date, or at such later time
                           and on such conditions as are determined by the
                           Committee.

                           5.7 Limitations on Exercise. The Committee may
specify a reasonable minimum number of Shares that may be purchased on exercise
of an Option, provided that such minimum number will not prevent Participant
from exercising the Option for the full number of Shares for which it is then
exercisable.

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                           5.8 Limitations on ISOs. The aggregate Fair Market
Value (determined as of the date of grant) of Shares with respect to which ISOs
are exercisable for the first time by a Participant during any calendar year
(under this Plan or under any other incentive stock option plan of the Company
or any Parent or Subsidiary of the Company) will not exceed $100,000. If the
Fair Market Value of Shares on the date of grant with respect to which ISOs are
exercisable for the first time by a Participant during any calendar year exceeds
$100,000, then the Options for the first $100,000 worth of Shares to become
exercisable in such calendar year will be ISOs and the Options for the amount in
excess of $100,000 that become exercisable in that calendar year will be NQSOs.
In the event that the Code or the regulations promulgated thereunder are amended
after the Effective Date (as defined in Section 17 hereof) to provide for a
different limit on the Fair Market Value of Shares permitted to be subject to
ISOs, then such different limit will be automatically incorporated herein and
will apply to any Options granted after the effective date of such amendment.

                           5.9 Modification, Extension or Renewal. The Committee
may modify, extend or renew outstanding Options and authorize the grant of new
Options in substitution therefor, provided that any such action may not, without
the written consent of a Participant, impair any of such Participant's rights
under any Option previously granted. Any outstanding ISO that is modified,
extended, renewed or otherwise altered will be treated in accordance with
Section 424(h) of the Code. Subject to Section 5.10 hereof, the Committee may
reduce the Exercise Price of outstanding Options without the consent of
Participants affected by a written notice to them; provided, however, that the
Exercise Price may not be reduced below the minimum Exercise Price that would be
permitted under Section 5.4 hereof for Options granted on the date the action is
taken to reduce the Exercise Price.

                           5.10 No Disqualification. Notwithstanding any other
provision in this Plan, no term of this Plan relating to ISOs will be
interpreted, amended or altered, nor will any discretion or authority granted
under this Plan be exercised, so as to disqualify this Plan under Section 422 of
the Code or, without the consent of the Participant affected, to disqualify any
ISO under Section 422 of the Code.

         6. PAYMENT FOR SHARE PURCHASES.

                           6.1 Payment. Payment for Shares purchased pursuant to
this Plan may be made in cash (by check) or, where expressly approved for the
Participant by the Committee and where permitted by law:

                  (a)      by cancellation of indebtedness of the Company to the
                           Participant;

                  (b)      by surrender of shares that: (i) either (A) have been
                           owned by the Participant for more than six (6) months
                           and have been paid for within the meaning of SEC Rule
                           144 (and, if such shares were purchased from the
                           Company by use of a promissory note, such note has
                           been fully paid with respect to such shares) or (B)
                           were obtained by the Participant in the public market
                           and (ii) are clear of all liens, claims, encumbrances
                           or security interests;

                  (c)      by tender of a full recourse promissory note having
                           such terms as may be approved by the Committee and
                           bearing interest at a rate sufficient to avoid
                           imputation of income under Sections 483 and 1274 of
                           the Code; provided, however, that Participants who
                           are not employees or directors of the Company will
                           not be entitled to purchase Shares with a promissory
                           note unless the note is adequately secured by
                           collateral other than the Shares;

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                  (d)      by waiver of compensation due or accrued to the
                           Participant for services rendered;

                  (e)      provided that a public market for the Company's stock
                           exists:

                           (1)      through a "same day sale" commitment from
                                    the Participant and a broker-dealer that is
                                    a member of the National Association of
                                    Securities Dealers (an "NASD DEALER")
                                    whereby the Participant irrevocably elects
                                    to exercise the Option and to sell a portion
                                    of the Shares so purchased to pay for the
                                    Exercise Price, and whereby the NASD Dealer
                                    irrevocably commits upon receipt of such
                                    Shares to forward the Exercise Price
                                    directly to the Company; or

                           (2)      through a "margin" commitment from the
                                    Participant and an NASD Dealer whereby the
                                    Participant irrevocably elects to exercise
                                    the Option and to pledge the Shares so
                                    purchased to the NASD Dealer in a margin
                                    account as security for a loan from the NASD
                                    Dealer in the amount of the Exercise Price,
                                    and whereby the NASD Dealer irrevocably
                                    commits upon receipt of such Shares to
                                    forward the Exercise Price directly to the
                                    Company; or

                  (f)      by any combination of the foregoing.

                           6.2 Loan Guarantees. The Committee may help the
Participant pay for Shares purchased under this Plan by authorizing a guarantee
by the Company of a third-party loan to the Participant.

                  7.       WITHHOLDING TAXES.

                           7.1 Withholding Generally. Whenever Shares are to be
issued in satisfaction of Options granted under this Plan, the Company may
require the Participant to remit to the Company an amount sufficient to satisfy
federal, state and local withholding tax requirements prior to the delivery of
any certificate or certificates for such Shares. Whenever, under this Plan,
payments in satisfaction of Options are to be made in cash, such payment will be
net of an amount sufficient to satisfy federal, state, and local withholding tax
requirements.

                           7.2 Stock Withholding. When, under applicable tax
laws, the Participant incurs tax liability in connection with the exercise or
vesting of any Option that is subject to tax withholding and the Participant is
obligated to pay the Company the amount required to be withheld, the Committee
may in its sole discretion allow the Participant to satisfy the minimum
withholding tax obligation by electing to have the Company withhold from the
Shares to be issued that number of Shares having a Fair Market Value equal to
the minimum amount required to be withheld, determined on the date that the
amount of tax to be withheld is to be determined. All elections by a Participant
to have Shares withheld for this purpose will be made in accordance with the
requirements established by the Committee and be in writing in a form acceptable
to the Committee.

                  8.       PRIVILEGES OF STOCK OWNERSHIP.

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                           8.1 Voting and Dividends. No Participant will have
any of the rights of a shareholder with respect to any Shares until the Shares
are issued to the Participant. After Shares are issued to the Participant, the
Participant will be a shareholder and have all the rights of a shareholder with
respect to such Shares, including the right to vote and receive all dividends or
other distributions made or paid with respect to such Shares; provided, that the
Participant will have no right to retain such stock dividends or stock
distributions with respect to Unvested Shares that are repurchased pursuant to
Section 10 hereof. The Company will comply with Section 260.140.1 of Title 10 of
the California Code of Regulations with respect to the voting rights of Common
Stock.

                           8.2 Financial Statements. The Company will provide
financial statements to each Participant prior to such Participant's purchase of
Shares under this Plan, and to each Participant annually during the period such
Participant has Options outstanding, or as otherwise required under Section
260.140.46 of Title 10 of the California Code of Regulations. Notwithstanding
the foregoing, the Company will not be required to provide such financial
statements to Participants when issuance is limited to key employees whose
services in connection with the Company assure them access to equivalent
information.

                  9. TRANSFERABILITY. Options granted under this Plan, and any
interest therein, will not be transferable or assignable by Participant, and may
not be made subject to execution, attachment or similar process, otherwise than
by will or by the laws of descent and distribution. During the lifetime of the
Participant an Option will be exercisable only by the Participant or
Participant's legal representative and any elections with respect to an Option
may be made only by the Participant or Participant's legal representative.

                  10. RESTRICTIONS ON SHARES.

                           10.1 Right of First Refusal. At the discretion of the
Committee, the Company may reserve to itself and/or its assignee(s) in the Stock
Option Agreement a right of first refusal to purchase all Shares that a
Participant (or a subsequent transferee) may propose to transfer to a third
party, unless otherwise not permitted by Section 25102(o) of the California
Corporations Code, provided, that such right of first refusal terminates upon
the Company's initial public offering of Common Stock pursuant to an effective
registration statement filed under the Securities Act.

                           10.2 Right of Repurchase. At the discretion of the
Committee, the Company may reserve to itself and/or its assignee(s) in the Stock
Option Agreement a right to repurchase Unvested Shares held by a Participant
following such Participant's Termination at any time within ninety (90) days
after Participant's Termination Date (or in the case of securities issued upon
exercise of an Option after the Participant's Termination Date, within ninety
(90) days after the date of such exercise) for cash and/or cancellation of
purchase money indebtedness, at the Participant's Exercise Price, provided, that
to the extent the Participant is not an officer, director or consultant of the
Company or of a Parent or Subsidiary of the Company such right to repurchase
Unvested Shares lapses at the rate of at least twenty percent (20%) per year
over five (5) years from the date of grant of the Option.

                  11. CERTIFICATES. All certificates for Shares or other
securities delivered under this Plan will be subject to such stock transfer
orders, legends and other restrictions as the Committee may deem necessary or
advisable, including restrictions under any applicable federal, state or foreign
securities law, or any rules, regulations and other requirements of the SEC or
any stock exchange or automated quotation system upon which the Shares may be
listed or quoted.

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                  12. ESCROW; PLEDGE OF SHARES. To enforce any restrictions on a
Participant's Shares, the Committee may require the Participant to deposit all
certificates representing Shares, together with stock powers or other
instruments of transfer approved by the Committee, appropriately endorsed in
blank, with the Company or an agent designated by the Company to hold in escrow
until such restrictions have lapsed or terminated, and the Committee may cause a
legend or legends referencing such restrictions to be placed on the
certificates. Any Participant who is permitted to execute a promissory note as
partial or full consideration for the purchase of Shares under this Plan will be
required to pledge and deposit with the Company all or part of the Shares so
purchased as collateral to secure the payment of Participant's obligation to the
Company under the promissory note; provided, however, that the Committee may
require or accept other or additional forms of collateral to secure the payment
of such obligation and, in any event, the Company will have full recourse
against the Participant under the promissory note notwithstanding any pledge of
the Participant's Shares or other collateral. In connection with any pledge of
the Shares, Participant will be required to execute and deliver a written pledge
agreement in such form as the Committee will from time to time approve. The
Shares purchased with the promissory note may be released from the pledge on a
pro rata basis as the promissory note is paid.

                  13. EXCHANGE AND BUYOUT OF OPTIONS. The Committee may, at any
time or from time to time, authorize the Company, with the consent of the
respective Participants, to issue new Options in exchange for the surrender and
cancellation of any or all outstanding Options. The Committee may at any time
buy from a Participant an Option previously granted with payment in cash, shares
of Common Stock of the Company (including restricted stock) or other
consideration, based on such terms and conditions as the Committee and the
Participant may agree.

                  14. SECURITIES LAW AND OTHER REGULATORY COMPLIANCE. This Plan
is intended to comply with Section 25102(o) of the California Corporations Code.
Any provision of this Plan which is inconsistent with Section 25102(o) shall,
without further act or amendment by the Company or the Board, be reformed to
comply with the requirements of Section 25102(o). An Option will not be
effective unless such Option is in compliance with all applicable federal and
state securities laws, rules and regulations of any governmental body, and the
requirements of any stock exchange or automated quotation system upon which the
Shares may then be listed or quoted, as they are in effect on the date of grant
of the Option and also on the date of exercise or other issuance.
Notwithstanding any other provision in this Plan, the Company will have no
obligation to issue or deliver certificates for Shares under this Plan prior to
(a) obtaining any approvals from governmental agencies that the Company
determines are necessary or advisable, and/or (b) compliance with any exemption,
completion of any registration or other qualification of such Shares under any
state or federal law or ruling of any governmental body that the Company
determines to be necessary or advisable. The Company will be under no obligation
to register the Shares with the SEC or to effect compliance with the exemption,
registration, qualification or listing requirements of any state securities
laws, stock exchange or automated quotation system, and the Company will have no
liability for any inability or failure to do so.

                  15. NO OBLIGATION TO EMPLOY. Nothing in this Plan or any
Option granted under this Plan will confer or be deemed to confer on any
Participant any right to continue in the employ of, or to continue any other
relationship with, the Company or any Parent or Subsidiary of the Company or
limit in any way the right of the Company or any Parent or Subsidiary of the
Company to terminate Participant's employment or other relationship at any time,
with or without cause.

                  16. CORPORATE TRANSACTIONS.

                           16.1 Assumption or Replacement of Options by
Successor or Acquiring Company. In the event of (a) a dissolution or liquidation
of the Company, (b) a merger or consolidation in which the Company is not the
surviving corporation, (c) a merger in which the Company is the surviving
corporation but after which the shareholders

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of the Company immediately prior to such merger (other than any shareholder
which merges with the Company in such merger, or which owns or controls another
corporation which merges, with the Company in such merger) cease to own their
shares or other equity interests in the Company, or (d) the sale of all or
substantially all of the assets of the Company, any or all outstanding Options
may be assumed, converted or replaced by the successor or acquiring corporation
(if any), which assumption, conversion or replacement will be binding on all
Participants. In the alternative, the successor or acquiring corporation may
substitute equivalent Options or provide substantially similar consideration to
Participants as was provided to shareholders (after taking into account the
existing provisions of the Options). The successor or acquiring corporation may
also issue, in place of outstanding Shares of the Company held by the
Participant, substantially similar shares or other property subject to
repurchase restrictions and other provisions no less favorable to the
Participant than those which applied to such outstanding Shares immediately
prior to such transaction described in this Section 16.1. In the event such
successor or acquiring corporation (if any) refuses to assume or substitute
Options, as provided above, pursuant to a transaction described in this Section
16.1, then notwithstanding any other provision in this Plan to the contrary,
such Options will expire on such transaction at such time and on such conditions
as the Board will determine.

                           16.2 Other Treatment of Options. Subject to any
greater rights granted to Participants under the foregoing provisions of this
Section 16, in the event of the occurrence of any transaction described in
Section 16.1 hereof, any outstanding Options will be treated as provided in the
applicable agreement or plan of merger, consolidation, dissolution, liquidation
or sale of assets.

                           16.3 Assumption of Options by the Company. The
Company, from time to time, also may substitute or assume outstanding options
granted by another company, whether in connection with an acquisition of such
other company or otherwise, by either (a) granting an Option under this Plan in
substitution of such other company's option, or (b) assuming such option as if
it had been granted under this Plan if the terms of such assumed option could be
applied to an Option granted under this Plan. Such substitution or assumption
will be permissible if the holder of the substituted or assumed option would
have been eligible to be granted an Option under this Plan if the other company
had applied the rules of this Plan to such grant. In the event the Company
assumes an option granted by another company, the terms and conditions of such
option will remain unchanged (except that the exercise price and the number and
nature of shares issuable upon exercise of any such option will be adjusted
appropriately pursuant to Section 424(a) of the Code). In the event the Company
elects to grant a new Option rather than assuming an existing option, such new
Option may be granted with a similarly adjusted Exercise Price.

                  17. ADOPTION AND SHAREHOLDER APPROVAL. This Plan will become
effective on the date that it is adopted by the Board (the "EFFECTIVE DATE").
This Plan will be approved by the shareholders of the Company (excluding Shares
issued pursuant to this Plan), consistent with applicable laws, within twelve
(12) months before or after the Effective Date. Upon the Effective Date, the
Board may grant Options pursuant to this Plan; provided, however, that: (a) no
Option may be exercised prior to initial shareholder approval of this Plan, and
(b) no Option granted pursuant to an increase in the number of Shares approved
by the Board shall be exercised prior to the time such increase has been
approved by the shareholders of the Company. In the event that initial
shareholder approval is not obtained within twelve (12) months before or after
this Plan is adopted by the Board, all Options granted hereunder will be
canceled.

                  18. TERM OF PLAN/GOVERNING LAW. Unless earlier terminated as
provided herein, this Plan will terminate ten (10) years from the Effective Date
or, if earlier, the date of shareholder approval. This Plan and all agreements
hereunder shall be governed by and construed in accordance with the laws of the
State of California.

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                  19. AMENDMENT OR TERMINATION OF PLAN. Subject to Section 5.9
hereof, the Board may at any time terminate or amend this Plan in any respect,
including without limitation amendment of any form of Stock Option Agreement or
instrument to be executed pursuant to this Plan; provided, however, that the
Board will not, without the approval of the shareholders of the Company, amend
this Plan in any manner that requires such shareholder approval pursuant to
Section 25102(o) of the California Corporations Code or the Code or the
regulations promulgated thereunder as such provisions apply to ISO plans.

                  20. NONEXCLUSIVITY OF THE PLAN. Neither the adoption of this
Plan by the Board, the submission of this Plan to the shareholders of the
Company for approval, nor any provision of this Plan will be construed as
creating any limitations on the power of the Board to adopt such additional
compensation arrangements as it may deem desirable, including, without
limitation, the granting of stock options or any other equity awards outside of
this Plan, and such arrangements may be either generally applicable or
applicable only in specific cases.

                  21. DEFINITIONS. As used in this Plan, the following terms
will have the following meanings:

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

                           "CAUSE" means Termination because of (i) any willful
material violation by the Participant of any law or regulation applicable to the
business of the Company or a Parent or Subsidiary of the Company, the
Participant's conviction for or guilty plea to, a felony or a crime involving
moral turpitude or any willful perpetration by the Participant of a common law
fraud, (ii) the Participant's commission of an act of personal dishonesty which
involves a personal profit in connection with the Company or any other entity
having a business relationship with the Company, (iii) any material breach by
the Participant of any material provision of any agreement or understanding
between the Company or a Parent or Subsidiary of the Company and the Participant
regarding the terms of the Participant's service as an employee, director or
consultant to the Company or a Parent or Subsidiary of the Company, including
without limitation, the willful and continued failure or refusal of the
Participant to perform the material duties required of such Participant as an
employee, director or consultant of the Company or a Parent or Subsidiary of the
Company, other than as a result of having a Disability, or a breach of any
applicable invention assignment and confidentiality agreement or similar
agreement between the Company or a Parent or Subsidiary of the Company and the
Participant, (iv) Participant's intentional disregard of the policies of the
Company or a Parent or Subsidiary of the Company so as to cause loss, damage or
injury to the property, reputation or employees of the Company or a Parent or
Subsidiary of the Company, or (v) any other misconduct by the Participant which
is materially injurious to the financial condition or business reputation of, or
is otherwise materially injurious to, the Company or a Parent or Subsidiary of
the Company.

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

                           "COMMITTEE" means the committee appointed by the
Board to administer this Plan, or if no committee is appointed, the Board.

                           "COMPANY" means Cadabra Inc. or any successor or
acquiring corporation.

                           "DISABILITY" means a disability, whether temporary or
permanent, partial or total, as determined by the Committee.

                                       10
<PAGE>   11

                           "EXERCISE PRICE" means the price at which a holder of
an Option may purchase the Shares issuable upon exercise of the Option.

                           "FAIR MARKET VALUE" means, as of any date, the value
of a share of the Company's Common Stock determined as follows:

                  (a)      if such Common Stock is then quoted on the Nasdaq
                           National Market, its closing price on the Nasdaq
                           National Market on the date of determination as
                           reported in The Wall Street Journal;

                  (b)      if such Common Stock is publicly traded and is then
                           listed on a national securities exchange, its closing
                           price on the date of determination on the principal
                           national securities exchange on which the Common
                           Stock is listed or admitted to trading as reported in
                           The Wall Street Journal;

                  (c)      if such Common Stock is publicly traded but is not
                           quoted on the Nasdaq National Market nor listed or
                           admitted to trading on a national securities
                           exchange, the average of the closing bid and asked
                           prices on the date of determination as reported by
                           The Wall Street Journal (or, if not so reported, as
                           otherwise reported by any newspaper or other source
                           as the Board may determine); or

                  (d)      if none of the foregoing is applicable, by the
                           Committee in good faith.

                           "OPTION" means an award of an option to purchase
Shares pursuant to Section 5 hereof.

                           "PARENT" means any corporation (other than the
Company) in an unbroken chain of corporations ending with the Company if each of
such 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.

                           "PARTICIPANT" means a person who receives an Option
under this Plan.

                           "PLAN" means this Cadabra Inc. 1998 Stock Option
Plan, as amended from time to time.

                           "SEC" means the Securities and Exchange Commission.

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

                           "SHARES" means shares of the Company's Common Stock
reserved for issuance under this Plan, as adjusted pursuant to Sections 2 and 16
hereof, and any successor security.

                                       11
<PAGE>   12

                           "SUBSIDIARY" or "SUBSIDIARIES" means any corporation
or corporations (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.

                           "TERMINATION" or "TERMINATED" means, for purposes of
this Plan with respect to a Participant, that the Participant has for any reason
ceased to provide services as an employee, officer, director or consultant to
the Company or a Parent or Subsidiary of the Company. A Participant will not be
deemed to have ceased to provide services in the case of (i) sick leave, (ii)
military leave, or (iii) any other leave of absence approved by the Committee,
provided that such leave is for a period of not more than ninety (90) days,
unless reinstatement (or, in the case of an employee with an ISO, reemployment)
upon the expiration of such leave is guaranteed by contract or statute or unless
provided otherwise pursuant to formal policy adopted from time to time by the
Company and issued and promulgated in writing. In the case of any Participant on
(i) sick leave, (ii) military leave or (iii) an approved leave of absence, the
Committee may make such provisions respecting suspension of vesting of the
Option while the Participant is on leave from the Company or a Parent or
Subsidiary of the Company as the Committee may deem appropriate, except that in
no event may an Option be exercised after the expiration of the term set forth
in the Stock Option Agreement. The Committee will have sole discretion to
determine whether a Participant has ceased to provide services and the effective
date on which the Participant ceased to provide services (the "TERMINATION
DATE").

                           "UNVESTED SHARES" means "Unvested Shares" as defined
in Section 2.2 of the Stock Option Agreement.

                           "VESTED SHARES" means "Vested Shares" as defined in
Section 2.2 of the Stock Option Agreement.

                                       12

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