Document:

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                                                                     EXHIBIT 4.3

                                BEAUTY.COM, INC.
                             1999 STOCK OPTION PLAN

     1.  Purposes of the Plan.  The purposes of this Stock Option Plan are to
attract and retain the best available personnel, to provide additional incentive
to Employees, Directors and Consultants and to promote the success of the
Company's business.

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

          (a)  "Administrator" means the Board or any of the Committees
appointed to administer the Plan.

          (b)  "Applicable Laws" means the legal requirements relating to the
administration of stock option plans, if any, under applicable provisions of
federal and state securities laws, the corporate law of the state of Delaware,
the Code, the rules of any applicable stock exchange or national market system,
and the rules of any foreign jurisdiction applicable to Options granted to
residents therein.

          (c)  "Option Agreement" means the written agreement evidencing the
grant of an Option executed by the Company and the Grantee, including any
amendments thereto.

          (d)  "Board" means the Board of Directors of the Company.

          (e) "Cause" means, with respect to the termination by the Company or a
Related Entity of the Grantee's Continuous Service, that such termination is for
"Cause" as such term is expressly defined in a then-effective written agreement
between the Grantee and the Company or such Related Entity, or in the absence of
such then-effective written agreement and definition, is based on, in the
determination of the Administrator, the Grantee's: (i) refusal or failure to act
in accordance with any specific, lawful direction or order of the Company or a
Related Entity; (ii) unfitness or unavailability for service or unsatisfactory
performance (other than as a result of Disability); (iii) performance of any act
or failure to perform any act in bad faith and to the detriment of the Company
or a Related Entity; (iv) dishonesty, intentional misconduct or material breach
of any agreement with the Company or a Related Entity; or (v) commission of a
crime involving dishonesty, breach of trust, or physical or emotional harm to
any person. At least 30 days prior to the termination of the Grantee's
Continuous Service pursuant to (i) or (ii) above, the Company shall provide the
Grantee with notice of the Company's or such Related Entity's intent to
terminate, the reason therefor, and an opportunity for the Grantee to cure such
defects in his or her service to the Company's or such Related Entity's
satisfaction. During this 30 day (or longer) period, no Option issued to the
Grantee under the Plan may be exercised or purchased.

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

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          (g)  "Committee" means any committee appointed by the Board to
administer the Plan.

          (h)  "Common Stock" means the common stock of the Company.

          (i)  "Company" means Beauty.com, Inc., a Delaware corporation.

          (j)  "Consultant" means any person (other than an Employee or a
Director, solely with respect to rendering services in such person's capacity as
a Director) who is engaged by the Company or any Related Entity to render
consulting or advisory services to the Company or such Related Entity.

          (k)  "Continuous Service" means that the provision of services to the
Company or a Related Entity in any capacity of Employee, Director or Consultant,
is not interrupted or terminated. Continuous Service shall not be considered
interrupted in the case of (i) any approved leave of absence, (ii) transfers
among the Company, any Related Entity, or any successor, in any capacity of
Employee, Director or Consultant, or (iii) any change in status as long as the
individual remains in the service of the Company or a Related Entity in any
capacity of Employee, Director or Consultant (except as otherwise provided in
the Option Agreement). An approved leave of absence shall include sick leave,
military leave, or any other authorized personal leave. For purposes of
Incentive Stock Options, no such leave may exceed ninety (90) days, unless
reemployment upon expiration of such leave is guaranteed by statute or contract.

          (l)  "Corporate Transaction" means any of the following transactions
to which the Company is a party:

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

               (ii)  the sale, transfer or other disposition of all or
substantially all of the assets of the Company (including the capital stock of
the Company's subsidiary corporations) in connection with the complete
liquidation or dissolution of the Company;

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

               (iv)  acquisition by any person or related group of persons
(other than the Company or by a Company-sponsored employee benefit plan) of
beneficial ownership (within the meaning of Rule 13d-3 of the Exchange Act) of
securities possessing more than fifty percent (50%) of the total combined voting
power of the Company's outstanding securities, but excluding any such
transaction that the Administrator determines shall not be a Corporate
Transaction.

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          (m)  "Director" means a member of the Board or the board of directors
of any Related Entity.

          (n)  "Disability" means that a Grantee is permanently unable to carry
out the responsibilities and functions of the position held by the Grantee by
reason of any medically determinable physical or mental impairment. A Grantee
will not be considered to have incurred a Disability unless he or she furnishes
proof of such impairment sufficient to satisfy the Administrator in its
discretion.

          (o)  "Employee" means any person, including an Officer or Director,
who is an employee of the Company or any Related Entity. The payment of a
director's fee by the Company or a Related Entity shall not be sufficient to
constitute "employment" by the Company.

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

          (q)  "Fair Market Value" means, as of any date, the value of Common
Stock determined as follows:

               (i)  Where there exists a public market for the Common Stock, the
Fair Market Value shall be (A) the closing price for a Share for the last market
trading day prior to the time of the determination (or, if no closing price was
reported on that date, on the last trading date on which a closing price was
reported) on the stock exchange determined by the Administrator to be the
primary market for the Common Stock or the Nasdaq National Market, whichever is
applicable or (B) if the Common Stock is not traded on any such exchange or
national market system, the average of the closing bid and asked prices of a
Share on the Nasdaq Small Cap Market for the day prior to the time of the
determination (or, if no such prices were reported on that date, on the last
date on which such prices were reported), in each case, as reported in The Wall
Street Journal or such other source as the Administrator deems reliable; or

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

          (r)  "Grantee" means an Employee, Director or Consultant who receives
an Option under the Plan.

          (s)  "Immediate Family" means any child, stepchild, grandchild,
parent, stepparent, grandparent, spouse, former spouse, sibling, niece, nephew,
mother-in-law, father-in-law, son-in-law, daughter-in-law, brother-in-law, or
sister-in-law, including adoptive relationships, any person sharing the
Grantee's household (other than a tenant or employee), a trust in which these
persons (or the Grantee) have more than fifty percent (50%) of the beneficial
interest, a foundation in which these persons (or the Grantee) control the
management of assets, and any other entity in which these persons (or the
Grantee) own more than fifty percent (50%) of the voting interests.

          (t)  "Incentive Stock Option" means an Option intended to qualify as
an incentive stock option within the meaning of Section 422 of the Code.

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          (u)  "Non-Qualified Stock Option" means an Option not intended to
qualify as an Incentive Stock Option.

          (v)  "Officer" means a person who is an officer of the Company or a
Related Entity within the meaning of Section 16 of the Exchange Act and the
rules and regulations promulgated thereunder.

          (w)  "Option" means an option to purchase Shares pursuant to an Option
Agreement granted under the Plan.

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

          (y)  "Plan" means this 1999 Stock Option Plan.

          (z)  "Post-Termination Exercise Period" means the period specified in
the Option Agreement commencing on the date of termination (other than
termination by the Company or any Related Entity for Cause) of the Grantee's
Continuous Service, or such longer period as may be applicable upon death or
Disability.

          (aa)  "Registration Date" means the first to occur of (i) the closing
of the first sale to the general public of (A) the Common Stock or (B) the same
class of securities of a successor corporation (or its Parent) issued pursuant
to a Corporate Transaction in exchange for or in substitution of the Common
Stock, pursuant to a registration statement filed with and declared effective by
the Securities and Exchange Commission under the Securities Act of 1933, as
amended; and (ii) in the event of a Corporate Transaction, the date of the
consummation of the Corporate Transaction if the same class of securities of the
successor corporation (or its Parent) issuable in such Corporate Transaction
shall have been sold to the general public pursuant to a registration statement
filed with and declared effective by the Securities and Exchange Commission
under the Securities Act of 1933, as amended, on or prior to the date of
consummation of such Corporate Transaction.

          (bb)  "Related Entity" means any Parent, Subsidiary and any business,
corporation, partnership, limited liability company or other entity in which the
Company, a Parent or a Subsidiary holds a substantial ownership interest,
directly or indirectly.

          (cc)  "Restricted Stock" means Shares issued under the Plan to the
Grantee for such consideration, if any, and subject to such restrictions on
transfer, rights of first refusal, repurchase provisions, forfeiture provisions,
and other terms and conditions as established by the Administrator.

          (dd)  "Share" means a share of the Common Stock.

          (ee)  "Subsidiary" means a "subsidiary corporation," whether now or
hereafter existing, as defined in Section 424(f) of the Code.

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     3.  Stock Subject to the Plan.

          (a)  Subject to the provisions of Section 10(a) below, the maximum
aggregate number of Shares which may be issued pursuant to all Options
(including Incentive Stock Options) is 2,089,916 Shares. The Shares may be
authorized, but unissued, or reacquired Common Stock.

          (b)  Any Shares covered by an Option (or portion of an Option) which
is forfeited or canceled, expires or is settled in cash, shall be deemed not to
have been issued for purposes of determining the maximum aggregate number of
Shares which may be issued under the Plan. Shares that actually have been issued
under the Plan pursuant to an Option shall not be returned to the Plan and shall
not become available for future issuance under the Plan, except that if unvested
Shares are forfeited, or repurchased by the Company at their original purchase
price, such Shares shall become available for future grant under the Plan.

     4.  Administration of the Plan.

          (a)  Plan Administrator.  With respect to grants of Options to
Employees, Directors, or Consultants, the Plan shall be administered by (A) the
Board or (B) a Committee (or a subcommittee of the Committee) designated by the
Board, which Committee shall be constituted in such a manner as to satisfy
Applicable Laws. Once appointed, such Committee shall continue to serve in its
designated capacity until otherwise directed by the Board.

          (b)  Multiple Administrative Bodies.  The Plan may be administered by
different bodies with respect to Directors, Officers, Consultants, and Employees
who are neither Directors nor Officers.

          (c)  Powers of the Administrator.  Subject to Applicable Laws and the
provisions of the Plan (including any other powers given to the Administrator
hereunder), and except as otherwise provided by the Board, the Administrator
shall have the authority, in its discretion:

               (i)  to select the Employees, Directors and Consultants to whom
Options may be granted from time to time hereunder;

               (ii)  to determine whether and to what extent Options are granted
hereunder;

               (iii)  to determine the number of Shares or the amount of other
consideration to be covered by each Option granted hereunder;

               (iv)  to approve forms of Option Agreements for use under the
Plan;

               (v)  to determine the terms and conditions of any Option granted
hereunder;

               (vi)  to establish additional terms, conditions, rules or
procedures to accommodate the rules or laws of applicable foreign jurisdictions
and to afford Grantees

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favorable treatment under such rules or laws; provided, however, that no Option
shall be granted under any such additional terms, conditions, rules or
procedures with terms or conditions which are inconsistent with the provisions
of the Plan;

               (vii)  to amend the terms of any outstanding Option granted under
the Plan, provided that any amendment that would adversely affect the Grantee's
rights under an outstanding Option shall not be made without the Grantee's
written consent;

               (viii)  to construe and interpret the terms of the Plan and
Options, including without limitation, any notice of Option or Option Agreement,
granted pursuant to the Plan; and

               (ix)  to take such other action, not inconsistent with the terms
of the Plan, as the Administrator deems appropriate.

     5.  Eligibility.  Options other than Incentive Stock Options may be granted
to Employees, Directors and Consultants. Incentive Stock Options may be granted
only to Employees of the Company, a Parent or a Subsidiary. An Employee,
Director or Consultant who has been granted an Option may, if otherwise
eligible, be granted additional Options. Options may be granted to such
Employees, Directors or Consultants who are residing in foreign jurisdictions as
the Administrator may determine from time to time.

     6.  Terms and Conditions of Options.

          (a)  Designation of Option.  Each Option shall be designated in the
Option Agreement as either an Incentive Stock Option or a Non-Qualified Stock
Option. However, notwithstanding such designation, to the extent that the
aggregate Fair Market Value of Shares subject to Options designated as Incentive
Stock Options which become exercisable for the first time by a Grantee during
any calendar year (under all plans of the Company or any Parent or Subsidiary)
exceeds $100,000, such excess Options, to the extent of the Shares covered
thereby in excess of the foregoing limitation, shall be treated as Non-Qualified
Stock Options. For this purpose, Incentive Stock Options shall be taken into
account in the order in which they were granted, and the Fair Market Value of
the Shares shall be determined as of the grant date of the relevant Option.

          (b)  Conditions of Option.  Subject to the terms of the Plan, the
Administrator shall determine the provisions, terms, and conditions of each
Option including, but not limited to, the Option vesting schedule, repurchase
provisions, rights of first refusal, forfeiture provisions, form of payment
(cash, Shares, or other consideration) upon settlement of the Option, payment
contingencies, and satisfaction of any performance criteria. The performance
criteria established by the Administrator may be based on any one of, or
combination of, increase in share price, earnings per share, total stockholder
return, return on equity, return on assets, return on investment, net operating
income, cash flow, revenue, economic value added, personal management
objectives, or other measure of performance selected by the Administrator.
Partial achievement of the specified criteria may result in a payment or vesting
corresponding to the degree of achievement as specified in the Option Agreement.

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          (c)  Acquisitions and Other Transactions.  The Administrator may issue
Options under the Plan in settlement, assumption or substitution for,
outstanding Options or obligations to grant future Options in connection with
the Company or a Related Entity acquiring another entity, an interest in another
entity or an additional interest in a Related Entity whether by merger, stock
purchase, asset purchase or other form of transaction.

          (d)  Deferral of Option Payment.  The Administrator may establish one
or more programs under the Plan to permit selected Grantees the opportunity to
elect to defer receipt of consideration upon exercise of an Option, satisfaction
of performance criteria, or other event that absent the election would entitle
the Grantee to payment or receipt of Shares or other consideration under an
Option. The Administrator may establish the election procedures, the timing of
such elections, the mechanisms for payments of, and accrual of interest or other
earnings, if any, on amounts, Shares or other consideration so deferred, and
such other terms, conditions, rules and procedures that the Administrator deems
advisable for the administration of any such deferral program.

          (e)  Separate Programs.  The Administrator may establish one or more
separate programs under the Plan for the purpose of issuing particular forms of
Options to one or more classes of Grantees on such terms and conditions as
determined by the Administrator from time to time.

          (f)  Early Exercise.  The Option Agreement may, but need not, include
a provision whereby the Grantee may elect at any time while an Employee,
Director or Consultant to exercise any part or all of the Option prior to full
vesting of the Option. Any unvested Shares received pursuant to such exercise
may be subject to a repurchase right in favor of the Company or a Related Entity
or to any other restriction the Administrator determines to be appropriate.

          (g)  Term of Option.  The term of each Option shall be the term stated
in the Option Agreement, provided, however, that the term shall be no more than
ten (10) years from the date of grant thereof. However, in the case of an
Incentive Stock Option granted to a Grantee who, at the time the Option is
granted, owns stock representing more than ten percent (10%) of the voting power
of all classes of stock of the Company or any Parent or Subsidiary, the term of
the Incentive Stock Option shall be five (5) years from the date of grant
thereof or such shorter term as may be provided in the Option Agreement.

          (h)  Transferability of Options.  Incentive Stock Options may not be
sold, pledged, assigned, hypothecated, transferred, or disposed of in any manner
other than by will or by the laws of descent or distribution and may be
exercised, during the lifetime of the Grantee, only by the Grantee; provided,
however, that the Grantee may designate a beneficiary of the Grantee's Incentive
Stock Option in the event of the Grantee's death on a beneficiary designation
form provided by the Administrator. Other Options may be transferred by will and
by the laws of descent and distribution, and during the lifetime of the Grantee,
by gift and or pursuant to domestic relations order to members of the Grantee's
Immediate Family to the extent and in the manner determined by the
Administrator.

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          (i)  Time of Granting Options.  The date of grant of an Option shall
for all purposes be the date on which the Administrator makes the determination
to grant such Option, or such other date as is determined by the Administrator.
Notice of the grant determination shall be given to each Employee, Director or
Consultant to whom an Option is so granted within a reasonable time after the
date of such grant.

     7.  Option Exercise or Purchase Price, Consideration and Taxes.

          (a)  Exercise or Purchase Price.  The exercise or purchase price, if
any, for an Option shall be as follows:

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

                    (A)  granted to an Employee who, at the time of the grant of
such Incentive Stock Option owns stock representing more than ten percent (10%)
of the voting power of all classes of stock of the Company or any Parent or
Subsidiary, the per Share exercise price shall be not less than one hundred ten
percent (110%) of the Fair Market Value per Share on the date of grant; or

                    (B)  granted to any Employee other than an Employee
described in the preceding paragraph, the per Share exercise price shall be not
less than one hundred percent (100%) of the Fair Market Value per Share on the
date of grant.

               (ii)  In the case of a Non-Qualified Stock Option, the per Share
exercise price shall be not less than eighty-five percent (85%) of the Fair
Market Value per Share on the date of grant unless otherwise determined by the
Administrator.

               (iii)  Notwithstanding the foregoing provisions of this Section
7(a), in the case of an Option issued pursuant to Section 6(c), above, the
exercise or purchase price for the Option shall be determined in accordance with
the principles of Section 424(a) of the Code.

          (b)  Consideration.  Subject to Applicable Laws, the consideration to
be paid for the Shares to be issued upon exercise or purchase of an Option
including the method of payment, shall be determined by the Administrator (and,
in the case of an Incentive Stock Option, shall be determined at the time of
grant). In addition to any other types of consideration the Administrator may
determine, the Administrator is authorized to accept as consideration for Shares
issued under the Plan the following provided that the portion of the
consideration equal to the par value of the Shares must be paid in cash or other
legal consideration permitted by the Delaware General Corporation Law:

               (i)  cash;

               (ii)  check;

               (iii)  delivery of Grantee's promissory note with such recourse,
interest, security, and redemption provisions as the Administrator determines as
appropriate;

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               (iv)  if the exercise or purchase occurs on or after the
Registration Date, surrender of Shares or delivery of a properly executed form
of attestation of ownership of Shares as the Administrator may require
(including withholding of Shares otherwise deliverable upon exercise of the
Option) which have a Fair Market Value on the date of surrender or attestation
equal to the aggregate exercise price of the Shares as to which said Option
shall be exercised (but only to the extent that such exercise of the Option
would not result in an accounting compensation charge with respect to the Shares
used to pay the exercise price unless otherwise determined by the
Administrator);

               (v)  if the exercise occurs on or after the Registration Date,
payment through a broker-dealer sale and remittance procedure pursuant to which
the Grantee (A) shall provide written instructions to a Company designated
brokerage firm to effect the immediate sale of some or all of the purchased
Shares and remit to the Company, out of the sale proceeds available on the
settlement date, sufficient funds to cover the aggregate exercise price payable
for the purchased Shares and (B) shall provide written directives to the Company
to deliver the certificates for the purchased Shares directly to such brokerage
firm in order to complete the sale transaction; or

               (vi)  any combination of the foregoing methods of payment.

          (c)  Taxes.  No Shares shall be delivered under the Plan to any
Grantee or other person until such Grantee or other person has made arrangements
acceptable to the Administrator for the satisfaction of any foreign, federal,
state, or local income and employment tax withholding obligations, including,
without limitation, obligations incident to the receipt of Shares or the
disqualifying disposition of Shares received on exercise of an Incentive Stock
Option. Upon exercise of an Option the Company shall withhold or collect from
Grantee an amount sufficient to satisfy such tax obligations.

     8.  Exercise of Option.

          (a)  Procedure for Exercise; Rights as a Stockholder.

               (i)  Any Option granted hereunder shall be exercisable at such
times and under such conditions as determined by the Administrator under the
terms of the Plan and specified in the Option Agreement.

               (ii)  An Option shall be deemed to be exercised when written
notice of such exercise has been given to the Company in accordance with the
terms of the Option by the person entitled to exercise the Option and full
payment for the Shares with respect to which the Option is exercised, including,
to the extent selected, use of the broker-dealer sale and remittance procedure
to pay the purchase price as provided in Section 7(b)(v). Until the issuance (as
evidenced by the appropriate entry on the books of the Company or of a duly
authorized transfer agent of the Company) of the stock certificate evidencing
such Shares, no right to vote or receive dividends or any other rights as a
stockholder shall exist with respect to Shares subject to an Option,
notwithstanding the exercise of an Option. No adjustment will be made for a
dividend or other right for which the record date is prior to the date the stock
certificate is issued, except as

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provided in the Option Agreement or Section 10(a), below. The Company shall
issue (or cause to be issued) such stock certificate promptly upon exercise of
the Option.

          (b)  Exercise of Option Following Termination of Continuous Service.
In the event of termination of a Grantee's Continuous Service for any reason
other than Disability or death (but not in the event of a Grantee's change of
status from Employee to Consultant or from Consultant to Employee), such Grantee
may, but only during the Post-Termination Exercise Period (but in no event later
than the expiration date of the term of such Option as set forth in the Option
Agreement), exercise the Option to the extent that the Grantee was entitled to
exercise it at the date of such termination or to such other extent as may be
determined by the Administrator. The Grantee's Option Agreement may provide that
upon the termination of the Grantee's Continuous Service for Cause, the
Grantee's right to exercise the Option shall terminate concurrently with the
termination of Grantee's Continuous Service. In the event of a Grantee's change
of status from Employee to Consultant, an Employee's Incentive Stock Option
shall convert automatically to a Non-Qualified Stock Option on the day three (3)
months and one day following such change of status. To the extent that the
Grantee is not entitled to exercise the Option at the date of termination, or if
the Grantee does not exercise such Option to the extent so entitled within the
Post-Termination Exercise Period, the Option shall terminate.

          (c)  Disability of Grantee.  In the event of termination of a
Grantee's Continuous Service as a result of his or her Disability, Grantee may,
but only within twelve (12) months from the date of such termination (and in no
event later than the expiration date of the term of such Option as set forth in
the Option Agreement), exercise the Option to the extent that the Grantee was
otherwise entitled to exercise it at the date of such termination; provided,
however, that if such Disability is not a "disability" as such term is defined
in Section 22(e)(3) of the Code, in the case of an Incentive Stock Option such
Incentive Stock Option shall automatically convert to a Non-Qualified Stock
Option on the day three (3) months and one day following such termination. To
the extent that the Grantee is not entitled to exercise the Option at the date
of termination, or if Grantee does not exercise such Option to the extent so
entitled within the time specified herein, the Option shall terminate.

          (d)  Death of Grantee.  In the event of a termination of the Grantee's
Continuous Service as a result of his or her death, or in the event of the death
of the Grantee during the Post-Termination Exercise Period or during the twelve
(12) month period following the Grantee's Termination of Continuous Service as a
result of his or her Disability, the Grantee's estate or a person who acquired
the right to exercise the Option by bequest or inheritance may exercise the
Option, but only to the extent that the Grantee was entitled to exercise the
Option as of the date of termination, within twelve (12) months from the date of
death (but in no event later than the expiration of the term of such Option as
set forth in the Option Agreement). To the extent that, at the time of death,
the Grantee was not entitled to exercise the Option, or if the Grantee's estate
or a person who acquired the right to exercise the Option by bequest or
inheritance does not exercise such Option to the extent so entitled within the
time specified herein, the Option shall terminate.

     9.  Conditions Upon Issuance of Shares.

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          (a)  Shares shall not be issued pursuant to the exercise of an Option
unless the exercise of such Option and the issuance and delivery of such Shares
pursuant thereto shall comply with all Applicable Laws, and shall be further
subject to the approval of counsel for the Company with respect to such
compliance.

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

     10.  Adjustments Upon Changes in Capitalization or Corporate Transaction.

          (a)  Adjustments upon Changes in Capitalization. Subject to any
required action by the stockholders of the Company, the number of Shares covered
by each outstanding Option, and the number of Shares which have been authorized
for issuance under the Plan but as to which no Options have yet been granted or
which have been returned to the Plan, the exercise or purchase price of each
such outstanding Option, as well as any other terms that the Administrator
determines require adjustment shall be proportionately adjusted for (i) any
increase or decrease in the number of issued Shares resulting from a stock
split, reverse stock split, stock dividend, combination or reclassification of
the Shares, or similar transaction affecting the Shares, (ii) any other increase
or decrease in the number of issued Shares effected without receipt of
consideration by the Company, or (iii) as the Administrator may determine in its
discretion, any other transaction with respect to Common Stock to which Section
424(a) of the Code applies or a similar transaction; provided, however that
conversion of any convertible securities of the Company shall not be deemed to
have been "effected without receipt of consideration." Such adjustment shall be
made by the Administrator and its determination shall be final, binding and
conclusive. Except as the Administrator determines, no issuance by the Company
of shares of stock of any class, or securities convertible into shares of stock
of any class, shall affect, and no adjustment by reason hereof shall be made
with respect to, the number or price of Shares subject to an Option.

          (b)  Corporate Transaction.

               (i)  Termination of Option if Not Assumed.  In the event of a
Corporate Transaction, each Option will terminate upon the consummation of the
Corporate Transaction, unless the Option is assumed by the successor corporation
or Parent thereof in connection with the Corporate Transaction.

               (ii) Acceleration of Option Upon Corporate Transaction.  Except
as provided otherwise in an individual Option Agreement, in the event of any
Corporate Transaction there will not be any acceleration of vesting or
exercisability of any Option.

     11.  Effective Date and Term of Plan.  The Plan shall become effective upon
the earlier to occur of its adoption by the Board or its approval by the
stockholders of the Company. It shall continue in effect for a term of ten (10)
years unless sooner terminated. Subject to Section 16,

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below, and Applicable Laws, Options may be granted under the Plan upon its
becoming effective.

     12.  Amendment, Suspension or Termination of the Plan.

          (a)  The Board may at any time amend, suspend or terminate the Plan.
To the extent necessary to comply with Applicable Laws, the Company shall obtain
stockholder approval of any Plan amendment in such a manner and to such a degree
as required.

          (b)  No Option may be granted during any suspension of the Plan or
after termination of the Plan.

          (c)  Any amendment, suspension or termination of the Plan (including
termination of the Plan under Section 11, above) shall not affect Options
already granted, and such Options shall remain in full force and effect as if
the Plan had not been amended, suspended or terminated, unless mutually agreed
otherwise between the Grantee and the Administrator, which agreement must be in
writing and signed by the Grantee and the Company.

     13.  Reservation of Shares.

          (a)  The Company, during the term of the Plan, will at all times
reserve and keep available such number of Shares as shall be sufficient to
satisfy the requirements of the Plan.

          (b)  The inability of the Company to obtain authority from any
regulatory body having jurisdiction, which authority is deemed by the Company's
counsel to be necessary to the lawful issuance and sale of any Shares hereunder,
shall relieve the Company of any liability in respect of the failure to issue or
sell such Shares as to which such requisite authority shall not have been
obtained.

     14.  No Effect on Terms of Employment/Consulting Relationship.  The Plan
shall not confer upon any Grantee any right with respect to the Grantee's
Continuous Service, nor shall it interfere in any way with his or her right or
the Company's right to terminate the Grantee's Continuous Service at any time,
with or without cause, and with or without notice.

     15.  No Effect on Retirement and Other Benefit Plans.  Except as
specifically provided in a retirement or other benefit plan of the Company or a
Related Entity, Options shall not be deemed compensation for purposes of
computing benefits or contributions under any retirement plan of the Company or
a Related Entity, and shall not affect any benefits under any other benefit plan
of any kind or any benefit plan subsequently instituted under which the
availability or amount of benefits is related to level of compensation. The Plan
is not a "Retirement Plan" or "Welfare Plan" under the Employee Retirement
Income Security Act of 1974, as amended.

     16.  Stockholder Approval.  The grant of Incentive Stock Options under the
Plan shall be subject to approval by the stockholders of the Company within
twelve (12) months before or after the date the Plan is adopted excluding
Incentive Stock Options issued in substitution for outstanding Incentive Stock
Options pursuant to Section 424(a) of the Code. Such stockholder approval shall
be obtained in the degree and manner required under Applicable Laws. The

                                       12
<PAGE>

Administrator may grant Incentive Stock Options under the Plan prior to approval
by the stockholders, but until such approval is obtained, no such Incentive
Stock Option shall be exercisable. In the event that stockholder approval is not
obtained with the twelve (12) month period provided above, all Incentive Stock
Options previously granted under the Plan shall be exercisable as Non-Qualified
Stock Options.

                                       13<PAGE>

                                                                    Exhibit 10.3

                                 DRUGSTORE.COM

                       1999 EMPLOYEE STOCK PURCHASE PLAN
                       ---------------------------------

              (As amended by the Board of Directors ______, 2000)

     The following constitute the provisions of the 1999 Employee Stock Purchase
Plan of drugstore.com.

     1.   Purpose.  The purpose of the Plan is to provide employees of the
Company and its Designated Subsidiaries with an opportunity to purchase Common
Stock of the Company.  It is the intention of the Company to have the Plan
qualify as an "Employee Stock Purchase Plan" under Section 423 of the Code.  The
provisions of the Plan shall, accordingly, be construed so as to extend and
limit participation in a manner consistent with the requirements of that section
of the Code.

     2.   Definitions.

          (a)  "Board" means the Board of Directors of the Company.

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

          (c)  "Common Stock" means the Common Stock of the Company.

          (d)  "Company" means drugstore.com, a Delaware corporation.

          (e)  "Compensation" means total cash compensation received by an
Employee from the Company or a Designated Subsidiary.  By way of illustration,
but not limitation, Compensation includes regular compensation such as salary,
wages, overtime, shift differentials, bonuses, commissions and incentive
compensation, but excludes relocation, expense reimbursements, tuition or other
reimbursements and income realized as a result of participation in any stock
option, stock purchase, or similar plan of the Company or any Designated
Subsidiary.

          (f)  "Continuous Status as an Employee" means the absence of any
interruption or termination of service as an Employee.  Continuous Status as an
Employee shall not be considered interrupted in the case of (i) sick leave; (ii)
military leave; (iii) any other leave of absence approved by the Administrator,
provided that such leave is for a period of not more than 90 days, unless
reemployment upon the expiration of such leave is guaranteed by contract or
statute, or unless provided otherwise pursuant to Company policy adopted from
time to time; or (iv) in the case of transfers between locations of the Company
or between the Company and its Designated Subsidiaries.

          (g)  "Contributions" means all amounts credited to the account of a
participant pursuant to the Plan.
<PAGE>

          (h)  "Corporate Transaction" means a sale of all or substantially all
of the Company's assets, or a merger, consolidation or other capital
reorganization of the Company with or into another corporation.

          (i)  "Designated Subsidiaries" means the Subsidiaries that have been
designated by the Board from time to time in its sole discretion as eligible to
participate in the Plan; provided however that the Board shall only have the
discretion to designate Subsidiaries if the issuance of options to such
Subsidiary's Employees pursuant to the Plan would not cause the Company to incur
adverse accounting charges.

          (j)  "Employee" means any person, including an Officer, who is an
Employee of the Company for tax purposes and who is customarily employed for at
least twenty (20) hours per week and more than five (5) months in a calendar
year by the Company or one of its Designated Subsidiaries.

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

          (l)  "Offering Date" means the first business day of each Offering
Period of the Plan, except that in the case of an individual who becomes an
eligible Employee after the first business day of an Offering Period but prior
to the first business day of the fourth calendar month within such Offering
Period, the term "Offering Date" means the first business day of such fourth
calendar month coinciding with or next succeeding the day on which that
individual becomes an eligible Employee.

          Options granted after the first business day of an Offering Period
will be subject to the same terms and conditions as the options granted on the
first business day of such Offering Period except that they will have a
different grant date (and thus, potentially, a different Purchase Price) and,
because they expire at the same time as the options granted on the first
business day of such Offering Period, a shorter term.

          (m)  "Offering Period" means a period of six (6) months commencing on
February 1 and August 1 of each year, other than the first Offering Period as
set forth in Section 4.

          (n)  "Officer" means a person who is an officer of the Company within
the meaning of Section 16 of the Exchange Act and the rules and regulations
promulgated thereunder.

          (o)  "Plan" means this 1999 Employee Stock Purchase Plan.

          (p)  "Purchase Date" means the last day of each Offering Period of the
Plan.

          (q)  "Purchase Price" means with respect to an Offering Period an
amount equal to 85% of the Fair Market Value (as defined in Section 7(b) below)
of a Share of Common Stock on the Offering Date or on the Purchase Date,
whichever is lower; provided, however, that in the event (i) of any stockholder-
approved increase in the number of Shares available for issuance under the Plan,
and (ii) all or a portion of such additional Shares are to be issued with

                                      -2-
<PAGE>

respect to the Offering Period that is underway at the time of such increase
("Additional Shares"), and (iii) the Fair Market Value of a Share of Common
Stock on the date of such increase (the "Approval Date Fair Market Value") is
higher than the Fair Market Value on the Offering Date for any such Offering
Period, then in such instance the Purchase Price with respect to Additional
Shares shall be 85% of the Approval Date Fair Market Value or the Fair Market
Value of a Share of Common Stock on the Purchase Date, whichever is lower.

          (s)  "Share" means a share of Common Stock, as adjusted in accordance
with Section 19 of the Plan.

          (t)  "Subsidiary" means a corporation, domestic or foreign, of which
not less than 50% of the voting shares are held by the Company or a Subsidiary,
whether or not such corporation now exists or is hereafter organized or acquired
by the Company or a Subsidiary.

     3.   Eligibility.

          (a)  Any person who is an Employee as of the Offering Date of a given
Offering Period shall be eligible to participate in such Offering Period under
the Plan, subject to the requirements of Section 5(a) and the limitations
imposed by Section 423(b) of the Code.

          (b)  Any provisions of the Plan to the contrary notwithstanding, no
Employee shall be granted an option under the Plan (i) if, immediately after the
grant, such Employee (or any other person whose stock would be attributed to
such Employee pursuant to Section 424(d) of the Code) would own capital stock of
the Company and/or hold outstanding options to purchase stock possessing five
percent (5%) or more of the total combined voting power or value of all classes
of stock of the Company or of any subsidiary of the Company, or (ii) if such
option would permit his or her rights to purchase stock under all employee stock
purchase plans (described in Section 423 of the Code) of the Company and its
Subsidiaries to accrue at a rate that exceeds Twenty-Five Thousand Dollars
($25,000) of the Fair Market Value (as defined in Section 7(b) below) of such
stock (determined at the time such option is granted) for each calendar year in
which such option is outstanding at any time.

                                      -3-
<PAGE>

     4.   Offering Periods.  The Plan shall be implemented by a series of
Offering Periods of six (6)  months' duration, with new Offering Periods
commencing on or about February 1 and August 1 of each year (or at such other
time or times as may be determined by the Board of Directors).  The first
Offering Period shall commence on the effective date of the Registration
Statement on Form S-1 for the initial public offering of the Company's Common
Stock (the "IPO Date") and continue until January 31, 2000.  The Plan shall
continue until terminated in accordance with Section 19 hereof.  The Board of
Directors of the Company shall have the power to change the duration and/or the
frequency of Offering Periods with respect to future offerings without
stockholder approval if such change is announced at least five (5) days prior to
the scheduled beginning of the first Offering Period to be affected.

     5.   Participation.

          (a)  An eligible Employee may become a participant in the Plan by
completing a subscription agreement and any other required documents
("Enrollment Documents") provided by the Company and submitting them to the
Company's Human Resources Department or the a stock brokerage or other financial
services firm designated by the Company ("Designated Broker") prior to the
applicable Offering Date, unless a later time for submission of the Enrollment
Documents is set by the Board for all eligible Employees with respect to a given
Offering Period.  The Enrollment Documents and their submission may be
electronic, as directed by the Company.  The Enrollment Documents shall set
forth the percentage of the participant's Compensation (subject to Section 6(a)
below) to be paid as Contributions pursuant to the Plan.

          (b)  Payroll deductions shall commence on the date of the first
paycheck paid following the Offering Date and shall end on the date of the last
paycheck paid on or prior to the Purchase Date of the Offering Period to which
the Enrollment Documents are applicable, unless sooner terminated by the
participant as provided in Section 10.

     6.   Method of Payment of Contributions.

          (a)  A participant shall elect to have payroll deductions made on each
payday during the Offering Period in an amount not less than one percent (1%)
and not more than twenty percent (20%) (or such greater percentage as the Board
may establish from time to time before an Offering Date) of such participant's
Compensation on each payday during the Offering Period.  All payroll deductions
made by a participant shall be credited to his or her account under the Plan.  A
participant may not make any additional payments into such account.

          (b)  A participant may discontinue his or her participation in the
Plan as provided in Section 10, or, on one occasion only during an Offering
Period may increase or decrease the rate of his or her Contributions with
respect to the Offering Period by completing and filing with the Company new
Enrollment Documents authorizing a change in the payroll deduction rate. The
change in rate shall be effective as of the beginning of the next payroll period
following the date of filing of the new Enrollment Documents, if the documents
are completed at least five (5) business days prior to such date and, if not, as
of the beginning of the next succeeding payroll period.

                                      -4-
<PAGE>

          (c)  Notwithstanding the foregoing, to the extent necessary to comply
with Section 423(b)(8) of the Code and Section 3(b) herein, a participant's
payroll deductions may be decreased during any Offering Period scheduled to end
during the current calendar year to 0%.  Payroll deductions shall re-commence at
the rate provided in such participant's subscription agreement at the beginning
of the first Offering Period that is scheduled to end in the following calendar
year, unless terminated by the participant as provided in Section 10.  In
addition, a participant's payroll deductions may be decreased by the Company to
0% at any time during an Offering Period in order to avoid unnecessary payroll
contributions as a result of application of the maximum share limit set forth in
Section 7(a), in which case payroll deductions shall re-commence at the rate
provided in such participant's subscription agreement at the beginning of the
next Offering Period, unless terminated by the participant as provided in
Section 10.

     7.   Grant of Option.

          (a)  On the Offering Date of each Offering Period, each eligible
Employee participating in such Offering Period shall be granted an option to
purchase on each Purchase Date a number of Shares of the Company's Common Stock
determined by dividing such Employee's Contributions accumulated prior to such
Purchase Date and retained in the participant's account as of the Purchase Date
by the applicable Purchase Price; provided however that the maximum number of
Shares an Employee may purchase during each Offering Period shall be 2,500
Shares (subject to any adjustment pursuant to Section 18 below), and provided
further that such purchase shall be subject to the limitations set forth in
Sections 3(b) and 12.

          (b)  The fair market value of the Company's Common Stock on a given
date (the "Fair Market Value") shall be determined by the Board in its
discretion based on the closing sales price of the Common Stock for such date
(or, in the event that the Common Stock is not traded on such date, on the
immediately preceding trading date), as reported by the National Association of
Securities Dealers Automated Quotation (Nasdaq) National Market or, if such
price is not reported, the mean of the bid and asked prices per share of the
Common Stock as reported by Nasdaq or, in the event the Common Stock is listed
on a stock exchange, the Fair Market Value per share shall be the closing sales
price on such exchange on such date (or, in the event that the Common Stock is
not traded on such date, on the immediately preceding trading date), as reported
in The Wall Street Journal.  For purposes of the Offering Date that coincides
with the IPO Date, the Fair Market Value of a share of the Common Stock of the
Company shall be the Price to Public as set forth in the final prospectus filed
with the Securities and Exchange Commission pursuant to Rule 424 under the
Securities Act of 1933, as amended.

     8.   Exercise of Option.  Unless a participant withdraws from the Plan as
provided in Section 10, his or her option for the purchase of Shares will be
exercised automatically on each Purchase Date of an Offering Period, and the
maximum number of Shares subject to the option will be purchased at the
applicable Purchase Price with the accumulated Contributions in his or her
account.  Fractional Shares shall be issued, as necessary.  The Shares purchased
upon exercise of an option hereunder shall be deemed to be transferred to the
participant on the Purchase Date.  During his or her lifetime, a participant's
option to purchase Shares hereunder is exercisable only by him or her.

                                      -5-
<PAGE>

     9.   Delivery.  As promptly as practicable after a Purchase Date, the
number of Shares purchased by each participant upon exercise of his or her
option shall be deposited into an account established in the participant's name
with the Designated Broker. Any payroll deductions accumulated in a
participant's account that are not applied toward the purchase of Shares on a
Purchase Date due to limitations imposed by the Plan shall be returned to the
participant.

     10.  Voluntary Withdrawal; Termination of Employment.

          (a)  A participant may withdraw all but not less than all the
Contributions credited to his or her account under the Plan at any time prior to
a Purchase Date by submitting a completed "Notice of Withdrawal" form to the
Company's Human Resources Department or electronically completing the required
documentation provided by the Company through the Designated Broker, as directed
by the Company's Human Resources Department.  All of the participant's
Contributions credited to his or her account will be paid to him or her promptly
after receipt of his or her notice of withdrawal and his or her option for the
current period will be automatically terminated, and no further Contributions
for the purchase of Shares will be made during the Offering Period.

          (b)  Upon termination of the participant's Continuous Status as an
Employee prior to the Purchase Date of an Offering Period for any reason,
whether voluntary or involuntary, including retirement or death, the
Contributions credited to his or her account will be returned to him or her or,
in the case of his or her death, to the person or persons entitled thereto under
Section 14, and his or her option will be automatically terminated.

          (c)  In the event an Employee fails to remain in Continuous Status as
an Employee of the Company for at least twenty (20) hours per week during the
Offering Period in which the employee is a participant, he or she will be deemed
to have elected to withdraw from the Plan and the Contributions credited to his
or her account will be returned to him or her and his or her option terminated.

          (d)  A participant's withdrawal from an offering will not have any
effect upon his or her eligibility to participate in a succeeding offering or in
any similar plan that may hereafter be adopted by the Company.

     11.  Interest.  No interest shall accrue on the Contributions of a
participant in the Plan.

     12.  Stock.

          (a)  Subject to adjustment as provided in Section 18, the maximum
number of Shares that shall be made available for sale under the Plan shall be
500,000 Shares, plus an annual increase on the first day of each of the
Company's fiscal years beginning in 2000, 2001, 2002, 2003 and 2004 equal to the
lesser of (i) 500,000 Shares, (ii) three percent (3%) of the Shares outstanding
on the last day of the immediately preceding fiscal year, or (iii) such lesser
number of Shares as is determined by the Board.  If the Board determines that,
on a given

                                      -6-
<PAGE>

Purchase Date, the number of shares with respect to which options are to be
exercised may exceed (1) the number of shares of Common Stock that were
available for sale under the Plan on the Offering Date of the applicable
Offering Period, or (2) the number of shares available for sale under the Plan
on such Purchase Date, the Board may in its sole discretion provide (x) that the
Company shall make a pro rata allocation of the Shares of Common Stock available
for purchase on such Offering Date or Purchase Date, as applicable, in as
uniform a manner as shall be practicable and as it shall determine in its sole
discretion to be equitable among all participants exercising options to purchase
Common Stock on such Purchase Date, and continue the Plan as then in effect, or
(y) that the Company shall make a pro rata allocation of the Shares available
for purchase on such Offering Date or Purchase Date, as applicable, in as
uniform a manner as shall be practicable and as it shall determine in its sole
discretion to be equitable among all participants exercising options to purchase
Common Stock on such Purchase Date, and terminate the Plan pursuant to Section
19 below. The Company may make a pro rata allocation of the Shares available on
the Offering Date of any applicable Offering Period pursuant to the preceding
sentence, notwithstanding any authorization of additional Shares for issuance
under the Plan by the Company's stockholders subsequent to such Offering Date.

          (b)  The participant shall have no interest or voting right in Shares
covered by his or her option until such option has been exercised.

          (c)  Shares to be delivered to a participant under the Plan will be
registered in the name of the participant or in the name of the participant and
his or her spouse.

     13.  Administration.  The Board, or a committee named by the Board, shall
supervise and administer the Plan and shall have full power to adopt, amend and
rescind any rules deemed desirable and appropriate for the administration of the
Plan and not inconsistent with the Plan, to construe and interpret the Plan, and
to make all other determinations necessary or advisable for the administration
of the Plan.

     14.  Designation of Beneficiary.

          (a)  A participant may designate a beneficiary who is to receive any
Shares and cash, if any, from the participant's account under the Plan in the
event of such participant's death subsequent to the end of an Offering Period
but prior to delivery to him or her of such Shares and cash.  In addition, a
participant may designate a beneficiary who is to receive any cash from the
participant's account under the Plan in the event of such participant's death
prior to the Purchase Date of an Offering Period.  If a participant is married
and the designated beneficiary is not the spouse, spousal consent shall be
required for such designation to be effective.  Beneficiary designations under
this Section 14(a) shall be made as directed by the Human Resources Department
of the Company, which may require electronic submission of the required
documentation with the Designated Broker.

          (b)  Such designation of beneficiary may be changed by the participant
(and his or her spouse, if any) at any time by submission of the required
notice, which required notice may be electronic. In the event of the death of a
participant and in the absence of a beneficiary validly designated under the
Plan who is living at the time of such participant's death, the Company shall

                                      -7-
<PAGE>

deliver such Shares and/or cash to the executor or administrator of the estate
of the participant, or if no such executor or administrator has been appointed
(to the knowledge of the Company), the Company, in its discretion, may deliver
such Shares and/or cash to the spouse or to any one or more dependents or
relatives of the participant, or if no spouse, dependent or relative is known to
the Company, then to such other person as the Company may designate.

     15.  Transferability.  Neither Contributions credited to a participant's
account nor any rights with regard to the exercise of an option or to receive
Shares under the Plan may be assigned, transferred, pledged or otherwise
disposed of in any way (other than by will, the laws of descent and
distribution, or as provided in Section 14) by the participant.  Any such
attempt at assignment, transfer, pledge or other disposition shall be without
effect, except that the Company may treat such act as an election to withdraw
funds in accordance with Section 10.

     16.  Use of Funds.  All Contributions received or held by the Company under
the Plan may be used by the Company for any corporate purpose, and the Company
shall not be obligated to segregate such Contributions.

     17.  Reports.  Individual accounts will be maintained for each participant
in the Plan.  Statements of account will be provided to participating Employees
by the Company or the Designated Broker at least annually, which statements will
set forth the amounts of Contributions, the per Share Purchase Price, the number
of Shares purchased and the remaining cash balance, if any.

     18.  Adjustments Upon Changes in Capitalization; Corporate Transactions.

          (a)  Adjustment.  Subject to any required action by the stockholders
of the Company, the number of Shares covered by each option under the Plan that
has not yet been exercised, the number of Shares that have been authorized for
issuance under the Plan but have not yet been placed under option (collectively,
the "Reserves"), the maximum number of Shares of Common Stock that may be
purchased by a participant in an Offering Period, the number of Shares of Common
Stock set forth in Section 12(a)(i) above, and the price per Share of Common
Stock covered by each option under the Plan that has not yet been exercised,
shall be proportionately adjusted for any increase or decrease in the number of
issued Shares resulting from a stock split, reverse stock split, stock dividend,
combination or reclassification of the Common Stock (including any such change
in the number of Shares of Common Stock effected in connection with a change in
domicile of the Company), or any other increase or decrease in the number of
Shares effected without receipt of consideration by the Company; provided
however that conversion of any convertible securities of the Company shall not
be deemed to have been "effected without receipt of consideration." Such
adjustment shall be made by the Board, whose determination in that respect shall
be final, binding and conclusive. Except as expressly provided herein, no issue
by the Company of shares of stock of any class, or securities convertible into
shares of stock of any class, shall affect, and no adjustment by reason thereof
shall be made with respect to, the number or price of Shares subject to an
option.

          (b)  Corporate Transactions.  In the event of a dissolution or
liquidation of the Company, any Offering Period then in progress will terminate
immediately prior to the

                                      -8-
<PAGE>

consummation of such action, unless otherwise provided by the Board. In the
event of a Corporate Transaction, each option outstanding under the Plan shall
be assumed or an equivalent option shall be substituted by the successor
corporation or a parent or Subsidiary of such successor corporation. In the
event that the successor corporation refuses to assume or substitute for
outstanding options, each Offering Period then in progress shall be shortened
and a new Purchase Date shall be set (the "New Purchase Date"), as of which date
any Offering Period then in progress will terminate. The New Purchase Date shall
be on or before the date of consummation of the transaction and the Board shall
notify each participant in writing, at least ten (10) days prior to the New
Purchase Date, that the Purchase Date for his or her option has been changed to
the New Purchase Date and that his or her option will be exercised automatically
on the New Purchase Date, unless prior to such date he or she has withdrawn from
the Offering Period as provided in Section 10. For purposes of this Section 18,
an option granted under the Plan shall be deemed to be assumed, without
limitation, if, at the time of issuance of the stock or other consideration upon
a Corporate Transaction, each holder of an option under the Plan would be
entitled to receive upon exercise of the option the same number and kind of
shares of stock or the same amount of property, cash or securities as such
holder would have been entitled to receive upon the occurrence of the
transaction if the holder had been, immediately prior to the transaction, the
holder of the number of Shares of Common Stock covered by the option at such
time (after giving effect to any adjustments in the number of Shares covered by
the option as provided for in this Section 18); provided however that if the
consideration received in the transaction is not solely common stock of the
successor corporation or its parent (as defined in Section 424(e) of the Code),
the Board may, with the consent of the successor corporation, provide for the
consideration to be received upon exercise of the option to be solely common
stock of the successor corporation or its parent equal in Fair Market Value to
the per Share consideration received by holders of Common Stock in the
transaction.

     The Board may, if it so determines in the exercise of its sole discretion,
also make provision for adjusting the Reserves, as well as the price per Share
of Common Stock covered by each outstanding option, in the event that the
Company effects one or more reorganizations, recapitalizations, rights offerings
or other increases or reductions of Shares of its outstanding Common Stock, and
in the event of the Company's being consolidated with or merged into any other
corporation.

     19.  Amendment or Termination.

          (a)  The Board may at any time and for any reason terminate or amend
the Plan.  Except as provided in Section 18, no such termination of the Plan may
affect options previously granted, provided that the Plan or an Offering Period
may be terminated by the Board on a Purchase Date or by the Board's setting a
new Purchase Date with respect to an Offering Period then in progress if the
Board determines that termination of the Plan and/or the Offering Period is in
the best interests of the Company and the stockholders or if continuation of the
Plan and/or the Offering Period would cause the Company to incur adverse
accounting charges as a result of a change after the effective date of the Plan
in the generally accepted accounting rules applicable to the Plan.  Except as
provided in Section 18 and in this Section 19, no amendment to the Plan shall
make any change in any option previously granted that adversely affects the
rights of any participant.  In addition, to the extent necessary to comply with
Rule 16b-3 under the

                                      -9-
<PAGE>

Exchange Act, or under Section 423 of the Code (or any successor rule or
provision or any applicable law or regulation), the Company shall obtain
stockholder approval in such a manner and to such a degree as so required.

          (b)  Without stockholder consent and without regard to whether any
participant rights may be considered to have been adversely affected, the Board
(or its committee) shall be entitled to change the Offering Periods, limit the
frequency and/or number of changes in the amount withheld during an Offering
Period, establish the exchange ratio applicable to amounts withheld in a
currency other than U.S. dollars, permit payroll withholding in excess of the
amount designated by a participant in order to adjust for delays or mistakes in
the Company's processing of properly completed withholding elections, establish
reasonable waiting and adjustment periods and/or accounting and crediting
procedures to ensure that amounts applied toward the purchase of Common Stock
for each participant properly correspond with amounts withheld from the
participant's Compensation, and establish such other limitations or procedures
as the Board (or its committee) determines in its sole discretion advisable that
are consistent with the Plan.

     20.  Notices.  All notices or other communications by a participant to the
Company under or in connection with the Plan shall be deemed to have been duly
given when received in the form specified by the Company at the location, or by
the person, designated by the Company for the receipt thereof.

     21.  Conditions Upon Issuance of Shares.  Shares shall not be issued with
respect to an option unless the exercise of such option and the issuance and
delivery of such Shares pursuant thereto shall comply with all applicable
provisions of law, domestic or foreign, including, without limitation, the
Securities Act of 1933, as amended, the Exchange Act, the rules and regulations
promulgated thereunder, applicable state securities laws and the requirements of
any stock exchange upon which the Shares may then be listed, and shall be
further subject to the approval of counsel for the Company with respect to such
compliance.

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

     22.  Term of Plan; Effective Date.  The Plan shall become effective upon
approval by the Company's stockholders.  It shall continue in effect for a term
of ten (10) years unless sooner terminated under Section 19.

     23.  Additional Restrictions of Rule 16b-3.  The terms and conditions of
options granted hereunder to, and the purchase of Shares by, persons subject to
Section 16 of the Exchange Act shall comply with the applicable provisions of
Rule 16b-3.  This Plan shall be deemed to contain, and such options shall
contain, and the Shares issued upon exercise thereof shall be subject to, such
additional conditions and restrictions as may be required by Rule 16b-3

                                      -10-
<PAGE>

to qualify for the maximum exemption from Section 16 of the Exchange Act with
respect to Plan transactions.

                                      -11-
<PAGE>

                                 DRUGSTORE.COM

                       1999 EMPLOYEE STOCK PURCHASE PLAN
                             SUBSCRIPTION AGREEMENT
                             ----------------------

                                                             New Election ______
                                                       Change of Election ______

     1.   I, ________________________, hereby elect to participate in the
drugstore.com 1999 Employee Stock Purchase Plan (the "Plan") for the Offering
Period ______________, ____ to _______________, ____, and subscribe to purchase
shares of the Company's Common Stock in accordance with this Subscription
Agreement and the Plan.

     2.   I elect to have Contributions in the amount of ____% of my
Compensation, as those terms are defined in the Plan, applied to this purchase.
I understand that this amount must not be less than 1% and not more than 20% of
my Compensation during the Offering Period.  (Please note that no fractional
percentages are permitted).

     3.   I hereby authorize payroll deductions from each paycheck during the
Offering Period at the rate stated in Item 2 of this Subscription Agreement.  I
understand that all payroll deductions made by me shall be credited to my
account under the Plan and that I may not make any additional payments into such
account.  I understand that all payments made by me shall be accumulated for the
purchase of shares of Common Stock at the applicable purchase price determined
in accordance with the Plan.  I further understand that, except as otherwise set
forth in the Plan, shares will be purchased for me automatically on the Purchase
Date of each Offering Period unless my employment is terminated prior to the
Purchase Date or I otherwise withdraw from the Plan by giving written notice to
the Company for such purpose.

     4.   I understand that I may discontinue at any time prior to the Purchase
Date my participation in the Plan as provided in Section 10 of the Plan.  I also
understand that I can increase or decrease the rate of my Contributions on one
occasion only with respect to each rate change during any Offering Period by
completing and filing a new Subscription Agreement with such increase or
decrease taking effect as of the beginning of the payroll period following the
date of filing of the new Subscription Agreement, if filed at least five (5)
business days prior to the beginning of such payroll period.  Further, I may
change the rate of deductions for future Offering Periods by filing a new
Subscription Agreement, and any such change will be effective as of the
beginning of the next Offering Period.  In addition, I acknowledge that, unless
I discontinue my participation in the Plan as provided in Section 10 of the
Plan, my election will continue to be effective for each successive Offering
Period.
<PAGE>

     5.   I have received a copy of the Company's most recent description of the
Plan and a copy of the complete "drugstore.com 1999 Employee Stock Purchase
Plan."  I understand that my participation in the Plan is in all respects
subject to the terms of the Plan.

     6.   Shares purchased for me under the Plan should be issued in the name(s)
of (name of employee or employee and spouse only):

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

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

     7.   In the event of my death, I hereby designate the following as my
beneficiary(ies) to receive all payments and shares due to me under the Plan:

NAME:  (Please print)                   ----------------------------------------
                                        (First)       (Middle)        (Last)

-----------------------------           ----------------------------------------
(Relationship)                          (Address)

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

     8.   I understand that if I dispose of any shares received by me pursuant
to the Plan within 2 years after the Offering Date (the first day of the
Offering Period during which I purchased such shares) or within 1 year after the
Purchase Date, I will be treated for federal income tax purposes as having
received ordinary compensation income at the time of such disposition in an
amount equal to the excess of the fair market value of the shares on the
Purchase Date over the price that I paid for the shares, regardless of whether I
disposed of the shares at a price less than their fair market value at the
Purchase Date. The remainder of the gain or loss, if any, recognized on such
disposition will be treated as capital gain or loss.

     I hereby agree to notify the Company in writing within 30 days after the
date of any such disposition, and I will make adequate provision for federal,
state or other tax withholding obligations, if any, that arise upon the
disposition of the Common Stock.  The Company may, but will not be obligated to,
withhold from my compensation the amount necessary to meet any applicable
withholding obligation including any withholding necessary to make available to
the Company any tax deductions or benefits attributable to the sale or early
disposition of Common Stock by me.

     9.   If I dispose of such shares at any time after expiration of the 2-year
and 1-year holding periods, I understand that I will be treated for federal
income tax purposes as having received compensation income only to the extent of
an amount equal to the lesser of (1) the excess of the fair market value of the
shares at the time of such disposition over the purchase price that I paid for
the shares under the option, or (2) 15% of the fair market value of the shares

                                      -2-
<PAGE>

on the Offering Date. The remainder of the gain or loss, if any, recognized on
such disposition will be treated as capital gain or loss.

     I understand that this tax summary is only a summary and is subject to
change.  I further understand that I should consult a tax advisor concerning the
tax implications of the purchase and sale of stock under the Plan.

     10.  I hereby agree to be bound by the terms of the Plan. The effectiveness
of this Subscription Agreement is dependent upon my eligibility to participate
in the Plan.

SIGNATURE:
          -----------------------------

SOCIAL SECURITY #:
                  ---------------------

DATE:
     ----------------------------------

SPOUSE'S SIGNATURE (necessary
if beneficiary is not spouse):

---------------------------------------
(Signature)

---------------------------------------
(Print name)

                                      -3-
<PAGE>

                                 DRUGSTORE.COM

                       1999 EMPLOYEE STOCK PURCHASE PLAN

                              NOTICE OF WITHDRAWAL
                              --------------------

     I, __________________________, hereby elect to withdraw my participation in
the drugstore.com 1999 Employee Stock Purchase Plan (the "Plan") for the
Offering Period that began on _________ ___, _____.  This withdrawal covers all
Contributions credited to my account and is effective on the date designated
below.

     I understand that all Contributions credited to my account will be paid to
me within ten (10) business days of receipt by the Company of this Notice of
Withdrawal and that my option for the current period will automatically
terminate, and that no further Contributions for the purchase of shares can be
made by me during the Offering Period.

     The undersigned further understands and agrees that he or she shall be
eligible to participate in succeeding offering periods only by delivering to the
Company a new Subscription Agreement.

Dated:
      ----------------------            ----------------------------------------
                                        Signature of Employee

                                        ----------------------------------------
                                        Social Security Number

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