Document:

CAPITAL SOUTHWEST CORPORATION
                             1999 STOCK OPTION PLAN

1.       Objective of the Plan.
         ---------------------
         The 1999 Stock  Option  Plan (the  "Plan") is  intended  to further the
established  policy of Capital  Southwest  Corporation  (the  "Corporation")  of
encouraging  ownership  of its  Common  Stock,  $1.00 par  value per share  (the
"Common Stock"),  by key employees of the Corporation and its management company
subsidiary,  Capital Southwest Management  Corporation,  and by its officers who
are  employees  of its  subsidiaries  and of  providing  incentives  for them to
enhance the value of the Corporation's  stock. By extending to key employees the
opportunity  to  acquire  proprietary   interests  in  the  Corporation  and  to
participate in its success,  the Plan may be expected to benefit the Corporation
and its shareholders and to be in their best interests by making it possible for
the Corporation to attract and retain the best available talent.

2.       Stock Reserved for the Plan.
         ----------------------------

         One hundred  forty  thousand  (140,000)  shares of the  authorized  but
unissued  Common  Stock are  reserved  for  issuance  and may be issued upon the
exercise of options granted under the Plan. In lieu of such unissued shares, the
Corporation  may,  in its  discretion,  transfer  upon the  exercise of options,
reacquired  shares or shares  bought in the market for the  purposes of the Plan
provided  that  (subject to the  provisions  of Section 14) the total  number of
shares which may be sold  pursuant to the exercise of options  granted under the
Plan shall not exceed one  hundred  forty  thousand  (140,000).  If any  options
granted under the Plan shall for any reason  terminate or expire  without having
been exercised in full, the Common Stock not purchased  under such options shall
again be available for the purposes of the Plan.

3.       Administration of the Plan.
         --------------------------

         The Plan  shall  be  administered  by the  Board  of  Directors  of the
Corporation  through actions  approved by the "required  majority" as defined in
Section 57(o) of the Investment Company Act of 1940, as amended (the "Investment
Company  Act").  The Board of  Directors  shall have  plenary  authority  in its
discretion,  but subject to the express provisions of the Plan, to determine the
employees to whom, and the time or times at which, options shall be granted, the
term of each such option, and the number of shares to be covered by each option;
to determine  whether an option shall be an "incentive  stock option" within the
meaning of Section 422 of the  Internal  Revenue  Code of 1986,  as amended (the
"Code"),  or a non-qualified  stock option; to interpret the Plan; to prescribe,
amend and rescind rules and  regulations  relating to the Plan; to determine the
employees to whom, and the time or times at which,  dividend  equivalent  rights
shall be granted, and the terms of such dividend equivalent rights; to determine
the terms  (which  need not be  identical)  of option  agreements  and  dividend
equivalent right  agreements  executed and delivered under the Plan; and to make
all other determinations deemed necessary or advisable for the administration of
the Plan.

4.       Eligibility Factors to be Considered in Making Grants.
         -----------------------------------------------------

         An option and/or dividend equivalent right may be granted to any person
who,  at the time of grant,  is either (i) a regular  salaried  employee  of the
Corporation or its management company subsidiary,  Capital Southwest  Management
Corporation;  or (ii) an officer of the  Corporation  who is a regular  salaried
employee  of one of its  subsidiaries  (such  person or persons  referred  to in
clauses  (i) and (ii) above  being  singularly  hereinafter  referred to as "Key
Employee," or, if more than one, as "Key Employees").  No incentive stock option
may be granted to an  individual  who  immediately  after such option is granted
owns,  within the meaning of Section 422(b) of the Code,  stock  possessing more
than 10% of the  total  combined  voting  power of all  classes  of stock of the
Corporation (or its subsidiaries) (hereinafter called a "l0% Holder"), except in
compliance  with the provisions of Sections 6 and 7 hereof.  In determining  the
Key Employees to whom options and/or dividend equivalent rights shall be granted
and the number of shares to be covered by each  option,  the Board of  Directors
shall  take into  account  the duties of the  respective  Key  Employees,  their
present and potential contributions to the success of the Corporation (or one of
its subsidiaries), the anticipated number of years of service remaining and such
other factors as they shall deem relevant in connection with  accomplishing  the
purpose of the Plan.  Subject to the provisions of Section 5, a Key Employee who
has been granted an option may be granted an additional option or options if the
Board of Directors shall so determine.

<PAGE>

5.       Types of Options; Maximum Allotment of Options.
         ----------------------------------------------

         The Board of Directors  may grant  either  incentive  stock  options or
non-qualified  stock  options under the Plan.  In addition,  the aggregate  fair
market  value  (determined  at the time of grant in  accordance  with  Section 6
hereof) of the shares of Common Stock which any Key  Employee is first  eligible
to purchase in any calendar year by exercise of incentive  stock options granted
under the Plan and all incentive  stock option plans of the  Corporation  or its
subsidiaries shall not exceed $100,000.  For this purpose, the fair market value
(determined  at the  respective  date of  grant  of each  option)  of the  stock
purchasable by exercise of an incentive stock option (or an installment thereof)
shall be counted against the $100,000 annual  limitation for a Key Employee only
for the  calendar  year such stock is first  purchasable  under the terms of the
option.

6.       Option Prices.
         -------------

         The purchase price of Common Stock covered by each option shall be 100%
of the fair market  value of the Common Stock at the time the option is granted,
except with respect to incentive  stock options  granted to any 10% Holder,  the
purchase  price shall be not less than 110% of the fair market  value.  The fair
market value shall be (i) if the Common Stock is listed on a national securities
exchange  (which term shall include the Nasdaq Stock Market),  the last reported
sale price of the Common Stock on such  exchange on the date on which the option
is granted  (or if there  shall be no  trading  on such  date,  then on the next
previous date on which there shall have been trading of the Common Stock);  (ii)
if the Common Stock is not listed on a national securities exchange, the average
of the  highest  bid and the lowest ask prices at the close of  business  in the
over-the-counter  market on the date on which the option is granted; or (iii) if
the Common Stock is neither listed on a national  securities exchange nor traded
in the  over-the-counter  market, as determined by the Board of Directors of the
Corporation in good faith on the basis of financial  information and information
regarding  recent  sales of Common Stock  available to it, using any  reasonable
valuation  method.  The Board's  determination of the fair market value shall be
conclusive  and the  purchase  price of shares of Common Stock under each option
shall be set forth in the minutes of the meeting of the Board of Directors.

7.       Term of Option.
         --------------

         The  term of each  option  shall  be for such  period  as the  Board of
Directors  shall  determine,  but not more than ten (10)  years from the date of
granting thereof,  except that in the case of incentive stock options granted to
10% Holders,  the term of each option shall not exceed five (5) years,  and each
option shall be subject to earlier termination as hereinafter provided.

8.       Exercise of Options and Withholding Taxes.
         -----------------------------------------

         (a) Unless otherwise determined by the Board of Directors,  each option
shall be exercisable on and after the first  anniversary of the date of grant in
five (5) equal annual  installments  of 20% of the shares subject to such option
and,  except as may be so  specified,  any annual  installment  of an option not
exercised  shall  accumulate  and thereafter may be exercised as to all, or from
time to time any part of, the shares  then  currently  exercisable  prior to the
expiration  of the option.  Fractional  shares will not be issued.  The purchase
price of the shares as to which an option  shall be  exercised  shall be paid in
full in cash  in  currency  of the  United  States  of  America  at the  time of
exercise,  except  that,  subject to the  receipt of  appropriate  orders of the
Securities  and  Exchange  Commission  which  may be  required  pursuant  to the
Investment  Company Act, the Board of Directors may, in its discretion,  provide
that payment of the purchase price of such shares may be made with shares of the
Corporation's  Common Stock. Except as provided in Sections 11 and 12 hereof, no
option  may be  exercised  at any time  unless  the  holder  thereof  is then an
employee of the Corporation or one of its subsidiaries.  The holder of an option
shall not have any of the  rights of a  shareholder  with  respect to the shares
covered by his  option  until  such  shares  shall be issued to him upon the due
exercise of the  option.  Proceeds  from the sale of stock  pursuant to the Plan
shall be used for general corporate purposes.

         (b) At the  time of  exercise  of a  non-qualified  stock  option  or a
disqualifying  disposition of shares issued under an incentive stock option, the
employee shall remit to the Corporation in cash all applicable federal and state
withholding taxes.

<PAGE>

9.       Non-Transferability.
         -------------------

         An option  granted under the Plan shall not be  transferable  otherwise
than by a will or the laws of  descent  and  distribution,  and an option may be
exercised  during the lifetime of the holder only by him. A dividend  equivalent
right  granted  under  the  Plan  shall  not be  transferable  unless  otherwise
expressly provided by the Board of Directors.

10.      Dividend Equivalent Rights.
         --------------------------

         Upon the declaration of any capital gain dividend, the Board shall have
the authority to grant dividend  equivalent rights with respect to such dividend
to eligible  employees  upon such terms and  conditions  as it shall  establish,
subject in all events to the  following  limitations  and  provisions of general
application set forth in the Plan. Each dividend  equivalent right shall entitle
a holder to receive a payment (cash or  otherwise)  equal to the market value on
the dividend  payment date of any specified  capital gain dividend  declared and
paid by the Corporation on one share of Common Stock. The Corporation shall make
payments  pursuant to each right within five (5) business days after the payment
of the specified capital gain dividend to holders of Common Stock.

         Each  dividend  equivalent  right shall be granted  independent  of any
option.

         In the event of termination of employment for any reason,  any dividend
equivalent  right  held by such  employee  on the date of  termination  shall be
forfeited, unless otherwise expressly provided by the Board of Directors.

11.      Termination of Employment.
         -------------------------

         In the event that the employment of any employee of the  Corporation or
one of its  subsidiaries to whom an option has been granted under the Plan shall
be  terminated  (otherwise  than by reason of death or for  "cause"  as  defined
below) such option may be exercised, to the extent that the holder of the option
was entitled to do so at the termination of his  employment,  at any time within
one (1) month after such  termination (six (6) months in the case of termination
of employment  at a time when the employee is  "disabled"  within the meaning of
Section 105 (d)(4) of the Code) but in no event after the expiration of the term
of the option. As used herein,  "cause" shall mean gross negligence,  dishonesty
or breach of fiduciary  obligations to the Corporation or its  subsidiaries.  In
the event of termination  of the employment of any option holder for cause,  all
outstanding  options held by such terminated  employee shall terminate effective
as of the date of notice of  termination.  Options  granted under the Plan shall
not be  affected  by any  change  of duties or  position  so long as the  holder
continues to be an employee of the Corporation or one of its  subsidiaries or is
employed by a corporation (or a related corporation of such corporation) issuing
or  assuming  an option in a  transaction  to which  Section  424(a) of the Code
applies. Retirement pursuant to any pension plan provided by the Corporation and
its  subsidiaries  shall be deemed to be a  termination  of  employment  for the
purposes of this  Section  11.  Nothing in the Plan or in any option or dividend
equivalent right granted pursuant to the Plan shall confer upon any employee any
right to continue in the employ of the Corporation or of the subsidiary by which
he is employed.

12.      Death of Employee.
         -----------------

         If an employee of the Corporation or one of its subsidiaries to whom an
option has been  granted  under the Plan shall die while he is  employed  by the
Corporation or one of its subsidiaries or within one (1) month after termination
of his employment,  such option may be exercised to the extent that the employee
was entitled to do so at the date of his death by his executor or  administrator
or other person at the time entitled by law to the  employee's  rights under the
option,  at any time within such period not  exceeding  six (6) months after the
date of the  termination  of his  employment by death or otherwise,  as shall be
prescribed in the option agreement,  but in no event after the expiration of the
term of the option.

<PAGE>

13.      Definitions.
         -----------

         For purposes of the Plan, a "subsidiary" of the Corporation  shall mean
a corporation,  whether domestic or foreign, in which the Corporation shall own,
directly or indirectly,  50% or more of the issued and outstanding capital stock
thereof,  and  "Corporation"  shall mean Capital  Southwest  Corporation and any
division thereof.

         For purposes of the Plan, employment with the Corporation or one of its
subsidiaries  shall mean  continuous  regular  employment as an employee,  or an
uninterrupted  chain of  continuous  regular  employment  as an employee or by a
corporation (or a related  corporation of such corporation)  issuing or assuming
an option in a transaction to which Section 424(a) of the Code applies.

         Military,  sick  leave,  or other bona fide leave of  absence,  such as
temporary employment by the government, shall not be considered a termination of
employment nor an  interruption of employment with the Corporation or one of its
subsidiaries  hereunder if the period of such leave does not exceed 90 days, or,
if longer, so long as the employee's right to re-employment is guaranteed either
by statute or by contract.

14.      Change in Control; Antidilution.
         -------------------------------

         (a)      Notwithstanding  any  provision  of the Plan to the  contrary,
                  each  outstanding  option granted  hereunder  shall become and
                  remain exercisable in full and each dividend  equivalent right
                  granted  hereunder shall  immediately  vest and remain in full
                  force and effect for its term,

                  (i)      on the date 10 days  prior to the  record  date for a
                           meeting of shareholders of the Corporation called for
                           the purpose of voting upon any  transaction or series
                           of  transactions  (other than a transaction  to which
                           only  the   Corporation   and  one  or  more  of  its
                           subsidiaries  are  parties)  pursuant  to  which  the
                           Corporation  would  become a  subsidiary  of  another
                           corporation or would be merged or  consolidated  with
                           or into  another  corporation,  or would engage in an
                           exchange  of  shares  with  another  corporation,  or
                           substantially  all of the  assets of the  Corporation
                           would  be  sold to or  acquired  by  another  person,
                           corporation or group of associated  persons acting in
                           concert; or

                  (ii)     on the date upon  which any  person,  corporation  or
                           group  of  associated   persons  acting  in  concert,
                           excluding  any  persons  who have then been owners of
                           10% or more of the  Common  Stock of the  Corporation
                           for a  continuous  period of at least ten (10) years,
                           becomes  a direct  or  indirect  beneficial  owner of
                           shares of stock of the  Corporation  representing  an
                           aggregate of more than 25% of the votes then entitled
                           to be cast at a meeting  for the  purpose of electing
                           Directors of the Corporation; or

                  (iii)    on the date upon which the persons  who were  members
                           of the Board of  Directors of the  Corporation  as of
                           March 31, 1999 (the "Original  Directors"),  cease to
                           constitute  a  majority  of the  Board of  Directors,
                           provided,   however,  that  any  new  Director  whose
                           nomination  or  selection  has been  approved  by the
                           affirmative  vote of at least  three of the  Original
                           Directors  then in  office  shall  also be  deemed an
                           Original  Director  for all  purposes of this Section
                           14(a)(iii).

         The Corporation  shall use its best efforts to notify each holder of an
         option  and/or  dividend  equivalent  right of his  rights  under  this
         Section  14(a) within a reasonable  period of time prior to the date or
         effective date of any transaction or event described above.

<PAGE>

         (b)      In the event that the Common Stock of the Corporation  subject
                  to options  granted  hereunder  is  hereafter  changed into or
                  exchanged  for a  different  number or kind of shares or other
                  securities of the  Corporation  or of another  corporation  by
                  reason of merger,  consolidation,  exchange  of shares,  other
                  reorganization,      recapitalization,       reclassification,
                  combination of shares, stock split-ups or stock dividends,

                  (i)      the  aggregate  number and kind of shares  subject to
                           outstanding  options and dividend  equivalent  rights
                           granted hereunder shall be adjusted appropriately;

                  (ii)     rights   under   outstanding   options  and  dividend
                           equivalent rights granted  hereunder,  both as to the
                           number  of  subject  shares,   and  with  respect  to
                           options,   the  option   price,   shall  be  adjusted
                           appropriately;

                  (iii)    where  dissolution or liquidation of the  Corporation
                           is  involved,  each  dividend  equivalent  right  and
                           outstanding option granted hereunder shall terminate,
                           but the  holder of an option  shall  have the  right,
                           immediately  prior to such dissolution or liquidation
                           to exercise his option in full,  notwithstanding  the
                           provisions  of  Section 8 (but  subject  to the other
                           terms   and   conditions   of  this   Plan)  and  the
                           Corporation  shall notify each holder of an option of
                           such right within a  reasonable  period of time prior
                           to any such dissolution or liquidation; and

                  (iv)     where any merger, consolidation or exchange of shares
                           is involved from and after the effective time of such
                           merger,  consolidation  or exchange  of shares,  each
                           dividend  equivalent right shall remain in full force
                           and effect and become the obligation of any successor
                           entity  and  each  holder  of  an  option   shall  be
                           entitled,  upon  exercise of his option in accordance
                           with all of the terms and conditions of this Plan, to
                           receive in lieu of Common  Stock of the  Corporation,
                           shares  of  such   stock  or  other   securities   or
                           consideration  as the holders of Common  Stock of the
                           Corporation  received  pursuant  to the  terms of the
                           merger,  consolidation  or  exchange  of shares.

         The adjustments  contained in clauses (i), (ii), (iii) and (iv) of this
         subsection (b) and the manner of application of such  provisions  shall
         be determined  solely by the Board of Directors and any such adjustment
         may provide for the elimination of fractional share interests.

15.      Time of Grant.
         -------------

         Nothing contained in the Plan or in any resolution to be adopted by the
Board of  Directors  or the  holders of Common  Stock of the  Corporation  shall
constitute the granting of any option or dividend equivalent right hereunder. An
option or dividend equivalent right pursuant to the Plan shall be deemed to have
been granted on the date on which the name of the recipient and the terms of the
option or dividend equivalent right, as applicable,  are determined by the Board
of Directors in accordance with Section 3.

16.      Termination and Amendment of the Plan.
         --------------------------------------

         Unless the Plan shall  theretofore  have been terminated as hereinafter
provided in this  Section 16, no option or  dividend  equivalent  right shall be
granted  hereunder  after  April  19,  2009.  The  Board  of  Directors  of  the
Corporation  may at any time prior to that date  terminate the Plan or make such
modification  or  amendment  of the Plan as it shall  deem  advisable;  provided
however,  that no amendment may be made which will disqualify an incentive stock
option  granted  hereunder as an "incentive  stock option" within the meaning of
Section  422 of the Code,  and  provided  that the Board of  Directors  may not,
without further  approval by the holders of Common Stock,  except as provided in
Section 14 hereof,  increase the maximum  number of shares for which options may
be granted  under the Plan,  either in the  aggregate or to any  individual,  or
change the manner of determining  the minimum option prices or extend the period
during which an option may be granted or exercised or amend the  requirements as
to  the  class  of  employees  eligible  to  receive  options.  No  termination,
modification  or  amendment  of the Plan may  adversely  affect the rights of an
option holder under an option  previously  granted to such option holder without
the consent of such option holder.

<PAGE>

17.      Government Regulations.
         -----------------------

         The Plan, the granting of dividend  equivalent rights, the granting and
exercise of options  thereunder,  and the obligation of the  Corporation to sell
and deliver shares under such options shall be subject to all  applicable  laws,
rules and regulations.

18.      Shareholder Approval.
         --------------------
         The Plan shall be  submitted  to the  shareholders  for approval at the
next annual meeting of shareholders or a special meeting of shareholders  called
for the purpose of such  approval,  but in no event more than one (1) year after
the date of its adoption by the Board of Directors. No grants will be made under
the Plan until it is approved by the shareholders of the Corporation.

19.      Severability.
         ------------
         If any  provision  of the Plan is held to be illegal or invalid for any
reason, that illegality or invalidity shall not affect the remaining portions of
the Plan,  but such  provision  shall be fully  severable  and the Plan shall be
construed  and  enforced as if the illegal or invalid  provision  had never been
included in this Plan. Such an illegal or invalid provision shall be replaced by
a revised provision that most nearly comports to the substance of the illegal or
invalid  provision.  If  any of the  terms  or  provisions  of the  Plan  or any
agreement  conflict  with the  requirements  of Rule  16b-3 (as  those  terms or
provisions  are applied to eligible  persons who are subject to Section 16(b) of
the  Securities  Exchange  Act of 1934,  as amended,  or Section 422 of the Code
(with  respect  to  incentive  stock  options)),   those  conflicting  terms  or
provisions  shall be deemed  inoperative  to the extent they conflict with those
requirements.  With respect to  incentive  stock  options,  if the Plan does not
contain any provision required to be included in a plan under Section 422 of the
Code, that provision  shall be deemed to be incorporated  into the Plan with the
same force and effect as if it had been expressly set out in the Plan; provided,
however,  that,  to the  extent  any option  that is  intended  to qualify as an
incentive stock option cannot so qualify,  that option (to that extent) shall be
deemed to be a non-qualified option for all purposes of the Plan.<PAGE>

                                                                    Exhibit 4.01
                                                                    ------------
                             ELECTRONIC ARTS INC.

                  INTERNATIONAL EMPLOYEE STOCK PURCHASE PLAN
                  ------------------------------------------

            As Approved by the Board of Directors on June 27, 1996,
as amended February 24, 1998, June 13, 1998, October 29, 1998 and February 14,
                                     2000

  1.    Establishment of Plan.  Electronic Arts Inc., (the "Company") proposes
        ---------------------                               -------
to grant options for purchase of the Company's Class A Common Stock to employees
of the Company's International Subsidiaries (as hereinafter defined) pursuant to
this International Employee Stock Purchase Plan (the "Plan"). For purposes of
                                                      ----
this Plan, "Subsidiary"  means any corporation (other than the Company) in an
            ----------
unbroken chain of corporations beginning with the Company if each of the
corporations other than the last corporation in the unbroken chain owns stock
possessing 50% or more of the total combined voting power of all classes of
stock in one of the other corporations in such chain.  "International
                                                        -------------
Subsidiary" means any Subsidiary organized under the laws of and incorporated
----------
and having its principle place of business outside the United States.  A total
of 475,000 shares of Class A Common Stock are reserved for issuance under the
Plan.  Such number shall be subject to adjustments effected in accordance with
Section 14 of the Plan.

  2.  Purposes.  The purpose of the Plan is to provide certain employees of the
      --------
International Subsidiaries of the Company as defined in section 4 below, as long
as no employee is an executive officer or director  of the Company ("Employee")
                                                                     --------
with a convenient means to acquire an equity interest in the Company through
payroll deductions, to enhance such Employees' sense of participation in the
affairs of the Company and Subsidiaries, and to provide an incentive for
continued employment.

  3.  Administration.  This Plan may be administered by the Board or a committee
      --------------
appointed by the Board (the "Committee").  The Plan shall be administered by the
                             ---------
Board or a committee appointed by the Board consisting of not less than three
(3) persons (who are members of the Board), each of whom is a disinterested
director.  As used in this Plan, references to the "Committee" shall mean either
the committee appointed by the Board to administer this Plan or the Board if no
committee has been established.  Subject to the provisions of the Plan, all
questions of interpretation or application of the Plan shall be determined by
the Committee and its decisions shall be final and binding upon all
participants.  Members of the Committee shall receive no compensation for their
services in connection with the administration of the Plan, other than standard
fees as established from time to time by the Board of Directors of the Company
for services rendered by Board members serving on Board committees.  All
expenses incurred in connection with the administration of the Plan shall be
paid by the Company.

  4.  Eligibility.  Any Employee is eligible to participate in an Offering
      -----------
Period (as hereinafter defined) under the Plan except the following:

      (a) Employees who are not employed by the International Subsidiaries on
          the fifteenth (15th) day of the month before the beginning of such
          Offering Period;

      (b) Employees who are customarily employed for less than 20 hours per week
          unless required by local law;

      (c) Employees who are customarily employed for less than five (5) months
          in a calendar year unless required by local law;

      d)  Employees who, together with any other person whose stock would be
          attributed to such employee pursuant to Section 424(d) of the Internal
          Revenue Code of 1986, as amended (the "Code"), own stock or hold
                                                 ----
          options to purchase stock or who, as a result of being granted an
          option under the Plan with respect to such Offering Period, would own
          stock or hold options to purchase stock possessing five (5) percent or
          more of the total combined voting power or value of all classes of
          stock of the Company or any of its subsidiaries; and

      (e) Employees who would, by virtue of their participation in such Offering
          Period, be participating simultaneously in more than one Offering
          Period under the Plan.

  5.  Offering Dates.  The Offering Periods of the Plan (the "Offering Period")
      --------------                                          ---------------
shall be of twelve (12) months duration commencing on the first business day of
March and September of each year and ending on the last business day of February
and August, respectively, hereafter.  The first Offering Period shall commence
on September 2, 1996.  The first day of each Offering Period is referred to as
the "Offering Date".  Each Offering Period shall consist of two (2) six-month
     -------------
purchase periods (individually, a "Purchase Period"), during which payroll
                                   ---------------
deductions of the participant are accumulated under this Plan.  Each such six-
month Purchase Period shall commence on the first business day of March and
September of an Offering Period and shall end on the last business day of the
following August and February, respectively.  The last business day of each
Purchase Period is hereinafter referred to as the Purchase Date.  The Board of
Directors of the Company shall have the power to change the duration of Offering
Periods or Purchase Periods if such change is
<PAGE>

announced at least fifteen (15) days prior to the scheduled beginning of the
first Offering Period or Purchase Period, as the case may be, to be affected.

  6.    Participation in the Plan.   Employees may become participants in an
        -------------------------
Offering Period under the Plan on the first Offering Date after satisfying the
eligibility requirements by delivering to the Employee's payroll department (the
"Payroll Department") not later than the 15th day of the month before such
 ------------------
Offering Date unless a later time for filing the subscription agreement is set
by the Board for all  Employees with respect to a given Offering Period a
subscription agreement authorizing payroll deductions.  An  Employee who does
not deliver a subscription agreement to the Payroll Department by such date
after becoming eligible to participate in such Offering Period under the Plan
shall not participate in that Offering Period or any subsequent Offering Period
unless such Employee enrolls in the Plan by filing the subscription agreement
with the Payroll Department not later than the 15th day of the month preceding a
subsequent Offering Date.  Once an Employee becomes a participant in an Offering
Period, such Employee will automatically participate in the Offering Period
commencing immediately following the last day of the prior Offering Period
unless the Employee withdraws from the Plan or terminates further participation
in the Offering Period as set forth in Section 11 below.  Such participant is
not required to file any additional subscription agreements in order to continue
participation in the Plan.  Any participant whose option expires and who has not
withdrawn from the Plan pursuant to Section 11 below will automatically be re-
enrolled in the Plan and granted a new option on the Offering Date of the next
Offering Period.  A participant in the Plan may participate in only one Offering
Period at any time.

  7.  Grant of Option on Enrollment.  Enrollment by an  Employee in the Plan
      -----------------------------
with respect to an Offering Period will constitute the grant (as of the Offering
Date) by the Company to such Employee of an option to purchase on each Purchase
Date up to that number of shares of Class A Common Stock of the Company
determined by dividing the amount accumulated in such Employee's payroll
deduction account during such Purchase Period by the lower of (i) eighty-five
percent (85%) of the fair market value of a share of the Company's Class A
Common Stock on the Offering Date (the "Entry Price") or (ii) eighty-five
                                        -----------
percent (85%) of the fair market value, of a share of the company's Class A
Common Stock on the Purchase Date, provided, however, that the number of shares
of the Company's Class A Common Stock subject to any option granted pursuant to
this Plan shall not exceed the lesser of (a) the maximum number of shares set by
the Board pursuant to Section 10(c) below with respect to all Purchase Periods
within the applicable Offering Period or Purchase Period, or (b) 200% of the
number of shares determined by using 85% of the fair market value of a share of
the Company's Class A Common Stock on the Offering Date as the denominator.
Fair market value of a share of the Company's Class A Common Stock shall be
determined as provided in Section 8 hereof.

  8.  Purchase Price.  The purchase price per share at which a share of Class A
      --------------
Common Stock will be sold in any Offering Period shall be eighty-five percent
(85%) of the lesser of:

      (a) the fair market value, in United States dollars, on the Offering Date
          or

      (b) the fair market value, in United States dollars, on the Purchase Date.

  For purposes of the Plan, the term "fair market value" on a given date shall
mean the closing bid from the previous day's trading of a share of the Company's
Class A Common Stock as reported on the Nasdaq National Market.

  9.  Payment of Purchase Price; Changes in Payroll Deductions; Issuance of
      ---------------------------------------------------------------------
Shares.
------

      (a) The purchase price of the shares is accumulated by regular payroll
deductions made during each Purchase Period.  The deductions are made as a
percentage of the Employee's compensation in one percent (1%) increments not
less than two percent (2%) nor greater than ten percent (10%).  Compensation
shall mean all compensation designated as employee compensation, including, but
not limited to base salary, wages, commissions, overtime, shift premiums and
bonuses, plus draws against commissions.  Payroll deductions shall commence with
the first pay period following the Offering Date and shall continue to the end
of the Offering Period unless sooner altered or terminated as provided in the
Plan.

      (b) A participant may lower (but not increase) the rate of payroll
deductions during a Purchase Period by filing with their local Payroll
Department a new authorization for payroll deductions, in which case the new
rate shall become effective for the next payroll period commencing more than 15
days after the Payroll Department's receipt of the authorization and shall
continue for the remainder of the Offering Period unless changed as described
below.  Such change in the rate of payroll deductions may be made at any time
during an Offering Period, but not more than one change may be made effective
during any Purchase Period.  A participant may increase or lower the rate of
payroll deductions for any subsequent Purchase Period by filing with the Payroll
Department a new authorization for payroll deductions not later than the 15th
day of the month before the beginning of such Purchase Period.

      (c) All payroll deductions made for a participant are credited to his or
her account under the Plan and are deposited with the general funds of the
Company; no interest accrues on the payroll deductions.  All payroll deductions
received or held by the Company may be used by the Company for any corporate
purpose, and the Company shall not be obligated to segregate such payroll
deductions.
<PAGE>

      (d) On each Purchase Date, as long as the Plan remains in effect and
provided that the participant has not submitted a signed and completed
withdrawal form before that date which notifies the Company that the participant
wishes to withdraw from that Offering Period under the Plan and have all payroll
deductions accumulated in the account maintained on behalf of the participant as
of that date returned to the participant, the Company shall apply the funds then
in the participant's account to the purchase of whole shares of Class A Common
Stock reserved under the option granted to such participant with respect to the
Offering Period to the extent that such option is exercisable on the Purchase
Date.  The purchase price per share shall be as specified in Section 8 of the
Plan.  Any cash remaining in a participant's account after such purchase of
shares shall be refunded to such participant in cash; provided, however, that
any amount remaining in participant's account on a Purchase Date which is less
than the amount necessary to purchase a full share of Class A Common Stock of
the Company shall be carried forward, without interest, into the next Purchase
Period or Offering Period, as the case may be.  In the event that the Plan has
been oversubscribed, all funds not used to purchase shares on the Purchase Date
shall be returned to the participant.  No Class A Common Stock shall be
purchased on a Purchase Date on behalf of any Employee whose participation in
the Plan has terminated prior to such Purchase Date.

      (e) As promptly as practicable after the Purchase Date, the Company shall
arrange the delivery to each participant, as appropriate, of a certificate
representing the shares purchased upon exercise of his option; provided that the
Company may deliver certificates to a broker or brokers that hold such
certificates in street name for the benefit of each such participant.

      (f) During a participant's lifetime, such participant's option to purchase
shares hereunder is exercisable only by him or her.  The participant will have
no interest or voting right in shares covered by his or her option until such
option has been exercised.  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.

  10. Limitations on Shares to be Purchased.
      -------------------------------------

      (a) No Employee shall be entitled to purchase stock under the Plan at a
rate which, when aggregated with his or her rights to purchase stock under all
other stock purchase plans of the Company or any Subsidiary, exceeds $25,000 in
fair market value, determined as of the Offering Date for each calendar year in
which the Employee participates in the Plan.

      (b) No more than 200% of the number of shares determined by using 85% of
the fair market value of a share of the Company's Class A Common Stock on the
Offering Date as the denominator may be purchased by a participant on any single
Purchase Date.

      (c) No Employee shall be entitled to purchase more than the Maximum Share
Amount (as defined below) on any single Purchase Date.  Not less than thirty
days prior to the commencement of any Purchase Period, the Board may, in its
sole discretion, set a maximum number of shares which may be purchased by any
Employee at any single Purchase Date (hereinafter the "Maximum Share Amount").
                                                       --------------------
In no event shall the Maximum Share Amount exceed the amounts permitted under
Section 10(b) above.  If a new Maximum Share Amount is set, then all
participants must be notified of such Maximum Share Amount not less than fifteen
(15) days prior to the commencement of the next Purchase Period.  Once the
Maximum Share Amount is set, it shall continue to apply with respect to all
succeeding Purchase Dates and Purchase Periods unless revised by the Board as
set forth above.

      (d) If the number of shares to be purchased on a Purchase Date by all
Employees participating in the Plan exceeds the number of shares then available
for issuance under the Plan, the Company shall make a pro rata allocation of the
remaining shares in as uniform a manner as shall be practicable and as the Board
shall determine to be equitable.  In such event, the Company shall give written
notice of such reduction of the number of shares to be purchased under a
participant's option to each Employee affected thereby.

      (e) Any payroll deductions accumulated in a participant's account which
are not used to purchase stock due to the limitations in this Section 10 shall
be returned to the participant as soon as practicable after the end of the
Offering Period.

  11. Withdrawal.
      ----------

      (a) Each participant may withdraw from an Offering Period under the Plan
          by signing and delivering to the local Payroll Department notice on a
          form provided for such purpose.  Such withdrawal may be elected at any
          time at least fifteen (15) days prior to the end of an Offering
          Period.

      (b) Upon withdrawal from the Plan, the accumulated payroll deductions
          shall be returned to the withdrawn Employee and his or her interest in
          the Plan shall terminate.  In the event an Employee voluntarily elects
          to withdraw from the Plan, he or she may not resume his or her
          participation in the Plan during the same Offering Period, but he or
          she may participate in any Offering Period under the Plan which
          commences on a date subsequent to such withdrawal by filing a new
          authorization for payroll deductions in the same manner as set forth
          above for initial participation in the Plan.
<PAGE>

      (c) A participant may participate in the current Purchase Period under an
          Offering Period (the "Current Offering Period") and enroll in the
                                -----------------------
          Offering Period commencing after such Purchase Period (the "New
                                                                      ---
          Offering Period") by (i) withdrawing from participating in the Current
          ---------------
          Offering Period effective as of the last day of a Purchase Period
          within that Offering Period and (ii) enrolling in the New Offering
          Period.  Such withdrawal and enrollment shall be effected by filing
          with the local Payroll Department at least fifteen (15) days prior to
          the end of a Purchase Period such form or forms as are provided for
          such purposes.

  12. Termination of Employment.  Termination of a participant's employment for
      -------------------------
any reason, including retirement or death or the failure of a participant to
remain an Employee, terminates his or her participation in the Plan immediately
on the date which Employee's employment with the Company ceases, or if earlier,
the date on which the Company gives notice of such termination.  In no event
shall participation in this plan extend beyond the participant's termination
date, nor shall any potential value of a purchase under this Plan be considered
in determining any notice or compensation in lieu of notice that may be required
or given upon termination of participant's employment by the Company.
Participant agrees that this provision is a condition to this Plan and
enrollment in the Plan waives any and all rights and claims participant may have
to value attributable to a purchase under this Plan which would have under any
circumstances taken place after the termination date.  In such event, the
payroll deductions credited to the participant's account will be returned to him
or her or, in the case of his or her death, to his or her legal representative.
For this purpose, an Employee will not be deemed to have terminated employment
or failed to remain in the continuous employ of the Company in the case of sick
leave, military leave, or any other leave of absence approved by the Board of
Directors of the Company; provided that such leave is for a period of not more
than ninety (90) days or re employment upon the expiration of such leave is
guaranteed by contract or statute.

  13. Return of Payroll Deductions.  In the event an Employee's interest in the
      ----------------------------
Plan is terminated by withdrawal, termination of employment or otherwise, or in
the event the Plan is terminated by the Board, the Company shall promptly
deliver to the Employee all payroll deductions credited to his account.  No
interest shall accrue on the payroll deductions of a participant in the Plan.

  14. Capital Changes.  Subject to any required action by the stockholders of
      ---------------
the Company, the number of shares of Class A Common Stock covered by each option
under the Plan which has not yet been exercised and the number of shares of
Class A Common Stock which have been authorized for issuance under the Plan but
have not yet been placed under option (collectively, the "Reserves"), as well as
                                                          --------
the price per share of Class A Common Stock covered by each option under the
Plan which has not yet been exercised, shall be proportionately adjusted for any
increase or decrease in the number of issued shares of Class A Common Stock
resulting from a stock split or the payment of a stock dividend (but only on the
Class A Common Stock) or any other increase or decrease in the number of shares
of Class A Common Stock effected without receipt of consideration by the
Company; provided, however, that conversion of any convertible securities of the
Company shall not be deemed to have been "effected without receipt of
consideration".  Such adjustment shall be made by the Board, whose determination
in that respect shall be final, binding and conclusive.  Except as expressly
provided herein, no 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 of Class A Common Stock subject to an option.

  In the event of the proposed dissolution or liquidation of the Company, the
Offering Period will terminate immediately prior to the consummation of such
proposed action, unless otherwise provided by the Board.  The Board may, in the
exercise of its sole discretion in such instances, declare that the options
under the Plan shall terminate as of a date fixed by the Board and give each
participant the right to exercise his or her option as to all of the optioned
stock, including shares which would not otherwise be exercisable.  In the event
of a proposed sale of all or substantially all of the assets of the Company, or
the merger of the Company with or into another corporation, each option under
the Plan shall be assumed or an equivalent option shall be substituted by such
successor corporation or a parent or subsidiary of such successor corporation,
unless the Board determines, in the exercise of its sole discretion and in lieu
of such assumption or substitution, that the participant shall have the right to
exercise the option as to all of the optioned stock.  If the Board makes an
option exercisable in lieu of assumption or substitution in the event of a
merger or sale of assets, the Board shall notify the participant that the option
shall be fully exercisable for a period of twenty (20) days from the date of
such notice, and the option will terminate upon the expiration of such period.

  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 Class A 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 Class A
Common Stock, and in the event of the Company being consolidated with or merged
into any other corporation.

  15. Nonassignability.  Neither payroll deductions 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 22 hereof) by the participant.  Any such attempt at
assignment, transfer, pledge or other disposition shall be without effect.

  16. Reports.  Individual accounts will be maintained for each participant in
      -------
the Plan.  Each participant shall receive promptly after the end of each
Purchase Period a report of his account setting forth the total payroll
deductions accumulated, the number of shares
<PAGE>

purchased, the per share price thereof and the remaining cash balance, if any,
carried forward to the next Purchase Period or Offering Period, as the case may
be.

  17. Notice of Disposition.  Each participant shall notify the Company if the
      ---------------------
participant disposes of any of the shares purchased in any Offering Period
pursuant to this Plan if such disposition occurs within two (2) years from the
Offering Date or within twelve (12) months from the Purchase Date on which such
shares were purchased (the "Notice Period").  Unless such participant is
                            -------------
disposing of any of such shares during the Notice Period, such participant shall
keep the certificates representing such shares in his or her name (and not in
the name of a nominee) during the Notice Period.  The Company may, at any time
during the Notice Period, place a legend or legends on any certificate
representing shares acquired pursuant to the Plan requesting the Company's
transfer agent to notify the Company of any transfer of the shares.  The
obligation of the participant to provide such notice shall continue
notwithstanding the placement of any such legend on certificates.

  18. No Rights to Continued Employment.  Neither this Plan nor the grant of any
      ---------------------------------
option hereunder shall confer any right on any Employee to remain in the employ
of the Company or any Subsidiary or restrict the right of the Company or any
Subsidiary to terminate such Employee's employment.

  19. Equal Rights and Privileges.  All  Employees shall have equal rights and
      ---------------------------
privileges with respect to 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. Designation of Beneficiary
      --------------------------
      (a) A participant may file a written designation of 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 a Purchase Period but prior to delivery to him of such
          shares and cash.  In addition, a participant may file a written
          designation of 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 a Purchase Date.
      (b) Such designation of beneficiary may be changed by the participant at
          any time by written notice.  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 deliver such shares 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 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.

  22. Conditions Upon Issuance of Shares; Limitation on Sale 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, 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.

  23. Applicable Law.  Except as otherwise expressly required under the laws of
      --------------
a country, the Plan and all rights thereunder shall be governed by and construed
in accordance with the laws of the state of California, United States of
America.  Should any provision of this Plan be determined by a court of
competent jurisdiction to be unlawful or unenforceable for a country, such
determination shall in no way affect the application of that provision in any
other country, or any of the remaining provisions of the Plan.

  24. Amendment or Termination of the Plan.  This Plan shall be effective on the
      ------------------------------------
day after the effective date of the Company's Registration Statement filed with
the Securities Exchange Commission under the Securities Act of 1933, as amended,
with respect to the shares issuable under the Plan (the "Effective Date"), and
the Plan shall continue until the earlier to occur of termination by the Board,
issuance of all of the shares of Class A Common Stock reserved for issuance
under the Plan, or ten (10) years from the adoption of the Plan by the Board.
The Board of Directors of the Company may at any time amend or terminate the
Plan, except that any such termination cannot affect options previously granted
under the Plan, nor may any amendment make any change in an option previously
granted which would adversely affect the right of any participant.
<PAGE>

            INTERNATIONAL EMPLOYEE STOCK PURCHASE PLAN ACTION FORM
                    ENROLLMENT/CHANGE/WITHDRAWAL AGREEMENT

-----------    Action                        Complete Sections
SECTION        ------                        -----------------
-----------    [_] New Enrollment                 2,3,4,6,8
               [_] Payroll Deduction Change       2, 4, 8
               [_] Withdrawal                     2, 5, 8
               [_] Beneficiary Change             2, 6, 8

-----------    Name:___________________ Location:_________________________
SECTION 2:
PERSONAL       Address:___________________________________________________
-----------

-----------    I hereby elect to participate in the Electronic Arts
SECTION 3:     Employee Stock Purchase Plan (the "Plan") and I agree to be bound
NEW            by its terms.  Stock purchased under the Plan should be
               registered in my name or in my name together with the following
               name:  ____________________________________________________.

-----------
SECTION 4:     I hereby authorize payroll deductions from each paycheck in that
PAYROLL        percentage of my compensation as shown below, in accordance with
DEDUCTION      the Plan.  Decreases in deductions will be effective for the
-----------    payroll period that begins 15 days after the payroll department's
               receipt of this form.  Increases in deductions will not be
               effective until the next Purchase Period.

               Amount to be Deducted (Circle One): 0%  2%  3%  4%  5%  6%  7%
               8%      9%      10%

-----------    Effective: _______/_______/_______ I will cease participating in
SECTION 5:                 Month    Date    Year  the Plan, all monies
-----------                                       contributed to Plan thus
                                                  far will be returned, and I
                                                  may not re-enroll until the
                                                  next Offering Period.

-----------    In the event of my death, I hereby designate the following
SECTION 6:     person(s) as my beneficiary(ies) to receive all payments and/or
-----------    stock due me under the Employee Stock Purchase Plan:

               Primary Beneficiary:_____________%:__ Relationship:____________
               Primary Beneficiary:_____________%:__ Relationship:____________
               Note:  If more than one primary beneficiary listed, please
               indicate % allocated to each.

               Secondary Beneficiary:_______________ Relationship:____________

-----------    I understand that my payroll deductions will be accumulated for
-----------    the automatic purchase of shares of Common Stock at the end
PRICE          of each Purchase Period, unless I withdraw from the Plan or
               become ineligible. The purchase price per share will be the
               lower of (i) 85% of the fair market value on the first day of an
               Offering Period or (ii) 85% of the fair market value on the last
               day of a Purchase Period.

SUCCESSIVE     I understand that this enrollment will be effective for each
PERIODS        subsequent Offering Period unless I withdraw from Plan or
               otherwise become ineligible to participate in the Plan. In the
               event, however, that the Offering Price for the new Offering
               Period for which I am not enrolled is less than the Offering
               Price for the Offering Period for which I am currently enrolled,
               I understand that I will automatically be withdrawn from the
               current Offering Period and re-enrolled in the new Offering
               Period unless I notify the Company to the contrary.

REVIEW OF      I have received a copy of the Company's most recent prospectus
PROSPECTUS     which describes the Plan. I understand that my participation is
               in all respects subject to the terms of the Plan.

-----------    I agree to be bound by the terms of this Form and the Plan.
SECTION 8:     I have been advised to consult my tax advisory with respect to
AUTHORIZATI    the tax consequences of participating in the Plan.
-----------
               I am not a citizen or resident of the United States and
               therefore not subject to United States income tax laws.  I
               understand that Electronic Arts makes no representation regarding
               the tax treatment under the tax laws of the country in which I am
               a citizen or resident in connection with the International
               Employee Stock Purchase Plan or my purchase of shares thereunder.
               I also understand that I am encouraged to consult with my own tax
               advisor, prior to purchasing shares under the Plan, concerning
               tax treatment of my participation in the Plan.

               I understand that because my payroll deductions will not be
               expressed in U.S. dollars and the value of shares of the
               Company's Class A Common Stock is expressed in U.S. dollars, it
               will be necessary to convert the amount of my payroll deductions
               into U.S. dollars in order to calculate various share amounts
               under the International Employee Stock Purchase Plan.  I also
               understand that the exercise price for the shares purchased by me
               pursuant to the International Employee Stock Purchase Plan will
               be expressed in U.S. dollars and that the exchange rates in
               effect at the end of the Purchase Period will be used to
               determine the number of shares which I may purchase on the
               exercise date.

               Signature of Employee:________________________ Date:___________

Please send original to Stock Administration and a Copy to Payroll.

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