Document:

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                                                                    Exhibit 10.6

THIS WARRANT AND THE SHARES ISSUABLE UPON THE EXERCISE OF THIS WARRANT HAVE NOT
BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED. EXCEPT AS
OTHERWISE SET FORTH HEREIN OR IN A SECURITIES PURCHASE AGREEMENT DATED AS OF
OCTOBER 11, 2000, NEITHER THIS WARRANT NOR ANY OF SUCH SHARES MAY BE SOLD,
TRANSFERRED OR ASSIGNED IN THE ABSENCE OF AN EFFECTIVE REGISTRATION STATEMENT
FOR SUCH SECURITIES UNDER SAID ACT OR, AN OPINION OF COUNSEL, IN FORM, SUBSTANCE
AND SCOPE, CUSTOMARY FOR OPINIONS OF COUNSEL IN COMPARABLE TRANSACTIONS, THAT
REGISTRATION IS NOT REQUIRED UNDER SUCH ACT OR UNLESS SOLD PURSUANT TO RULE 144
UNDER SUCH ACT.

  Right to Purchase 909,091 Shares of Common Stock, par value $.001 per share

                             STOCK PURCHASE WARRANT

     THIS CERTIFIES THAT, for value received, RGC International Investors, LDC
or its registered assigns, is entitled to purchase from American Telescource
International, Inc., a Delaware corporation (the "Company"), at any time or from
time to time during the period specified in Paragraph 2 hereof, Nine Hundred
Nine Thousand Ninety-One (909,091) fully paid and nonassessable shares of the
Company's Common Stock, par value $.001 per share (the "Common Stock"), at an
exercise price of $1.71875 (per share (the "Exercise Price"); provided, however,
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if the average of the Closing Bid Prices (as defined in the Certificate of
Designation (as defined in the Securities Purchase Agreement (as defined
below))) of the Common Stock on the American Stock Exchange (the "AMEX") (or
such other principal securities market or stock exchange on which the Common
Stock is then listed) for the ten (10) Trading Days (as defined in the
Certificate of Designation) preceding October 11, 2001 (the "Anniversary Price")
is less than the Exercise Price, the Exercise Price will be reduced to the
Anniversary Price.  The term "Warrant Shares," as used herein, refers to the
shares of Common Stock purchasable hereunder.  The Warrant Shares and the
Exercise Price are subject to adjustment as provided in Paragraph 4 hereof.  The
term Warrants means this Warrant and the other warrants issued pursuant to that
certain Securities Purchase Agreement, dated October 11, 2000, by and among the
Company and the Buyers listed on the execution page thereof (the "Securities
Purchase Agreement").
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     This Warrant is subject to the following terms, provisions, and conditions:

1.    Manner of Exercise; Issuance of Certificates; Payment for Shares.  Subject
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to the provisions hereof, this Warrant may be exercised by the holder hereof, in
whole or in part, by the surrender of this Warrant, together with a completed
exercise agreement in the form attached hereto (the "Exercise Agreement"), to
the Company during normal business hours on any business day at the Company's
principal executive offices (or such other office or agency of the Company as it
may designate by notice to the holder hereof), and upon (i) payment to the
Company in cash, by certified or official bank check or by wire transfer for the
account of the Company of the Exercise Price for the Warrant Shares specified in
the Exercise Agreement or (ii) if the resale of the Warrant Shares by the holder
is not then registered pursuant to an effective registration statement under the
Securities Act of 1933, as amended (the "Securities Act"), delivery to the
Company of a written notice of an election to effect a "Cashless Exercise" (as
defined in Section 11(c) below) for the Warrant Shares specified in the Exercise
Agreement.  The Warrant Shares so purchased shall be deemed to be issued to the
holder hereof or such holder's designee, as the record owner of such shares, as
of the close of business on the date on which this Warrant shall have been
surrendered, the completed Exercise Agreement shall have been delivered, and
payment shall have been made for such shares (or an election to effect a
Cashless Exercise has been made) as set forth above.  Certificates for the
Warrant Shares so purchased, representing the aggregate number of shares
specified in the Exercise Agreement, shall be delivered to the holder hereof
within a reasonable time, not exceeding two (2) business days, after this
Warrant shall have been so exercised.  The certificates so delivered shall be in
such denominations as may be requested by the holder hereof and shall be
registered in the name of such holder or such other name as shall be designated
by such holder.  If this Warrant shall have been exercised only in part, then,
unless this Warrant has expired, the Company shall, at its expense, at the time
of delivery of such certificates, deliver to the holder a new Warrant
representing the number of shares with respect to which this Warrant shall not
then have been exercised.

2.      Notwithstanding anything in this Warrant to the contrary, in no event
shall the Holder of this Warrant be entitled to exercise a number of Warrants
(or portions thereof) in excess of the number of Warrants (or portions thereof)
upon exercise of which the sum of (i) the number of shares of Common Stock
beneficially owned by the Holder and its affiliates (other than shares of Common
Stock which may be deemed beneficially owned through the ownership of the
unexercised Warrants and the unexercised or unconverted portion of any other
securities of the Company (including shares of Series E Preferred Stock (as
defined in the Securities Purchase Agreement)) subject to a limitation on
conversion or exercise analogous to the limitation contained herein) and (ii)
the number of shares of Common Stock issuable upon exercise of the Warrants (or
portions thereof) with respect to which the determination described herein is
being made, would result in beneficial ownership by the Holder and its
affiliates of more than 4.9% of the outstanding shares of Common Stock.  For
purposes of the immediately preceding sentence, beneficial ownership shall be
determined in accordance with Section 13(d) of the Securities Exchange Act of
1934, as amended, and Regulation 13D-G thereunder, except as otherwise provided
in clause (i) hereof.  Notwithstanding anything in this Warrant to the contrary,
the restrictions on exercise of this Warrant set forth in this paragraph shall
not be amended without
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(i) the written consent of the Holder and the Company and (ii) the approval of
the holders of a majority of the Common Stock present, or represented by proxy,
and voting at any meeting called to vote on the amendment of such restriction.

3.    Period of Exercise.  This Warrant is exercisable at any time or from time
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to time on or after the date on which this Warrant is issued and delivered
pursuant to the terms of the Securities Purchase Agreement (the "Issue Date")
and before 5:00 p.m., New York City time on the fourth (4th) anniversary of the
Issue Date (the "Exercise Period").

4.    Certain Agreements of the Company.  The Company hereby covenants and
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agrees as follows:

(a)   Shares to be Fully Paid.  All Warrant Shares will, upon issuance in
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      accordance with the terms of this Warrant, be validly issued, fully paid,
      and nonassessable and free from all taxes, liens, and charges with respect
      to the issue thereof.

(b)   Reservation of Shares.  During the Exercise Period, the Company shall at
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      all times have authorized, and reserved for the purpose of issuance upon
      exercise of this Warrant, a sufficient number of shares of Common Stock to
      provide for the exercise of this Warrant.

(c)   Listing.  The Company shall promptly secure the listing of the shares of
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      Common Stock issuable upon exercise of the Warrant upon each national
      securities exchange or automated quotation system, if any, upon which
      shares of Common Stock are then listed (subject to official notice of
      issuance upon exercise of this Warrant) and shall maintain, so long as any
      other shares of Common Stock shall be so listed, such listing of all
      shares of Common Stock from time to time issuable upon the exercise of
      this Warrant; and the Company shall so list on each national securities
      exchange or automated quotation system, as the case may be, and shall
      maintain such listing of, any other shares of capital stock of the Company
      issuable upon the exercise of this Warrant if and so long as any shares of
      the same class shall be listed on such national securities exchange or
      automated quotation system.

(d)   Certain Actions Prohibited.  The Company will not, by amendment of its
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      charter or through any reorganization, transfer of assets, consolidation,
      merger, dissolution, issue or sale of securities, or any other voluntary
      action, avoid or seek to avoid the observance or performance of any of the
      terms to be observed or performed by it hereunder, but will at all times
      in good faith assist in the carrying out of all the provisions of this
      Warrant and in the taking of all such action as may reasonably be
      requested by the holder of this Warrant in order to protect the exercise
      privilege of the holder of this Warrant against dilution or other
      impairment, consistent with the tenor and purpose of this Warrant. Without
      limiting the generality of the foregoing, the Company (i) will not
      increase the par value of any shares of Common Stock receivable upon the
      exercise of this Warrant above the Exercise Price then in effect, and (ii)
      will take all such actions as may be necessary or appropriate in order
      that the Company may validly and legally issue fully paid and
      nonassessable shares of Common Stock upon the exercise of this Warrant.
      Notwithstanding anything to the contrary contained herein, the limitation
      on exercise of this Warrant set forth in this paragraph may not be amended
      without (i) the written consent of the holder hereof and the Company and
      (ii) the approval of the holders of a majority of the Company's Common
      Stock present, or represented by proxy, and voting at any meeting called
      to vote on the amendment of such restriction.
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(e)  Successors and Assigns.  This Warrant will be binding upon any entity
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     succeeding to the Company by merger, consolidation, or acquisition of all
     or substantially all the Company's assets.

     Antidilution Provisions.  During the Exercise Period, the Exercise Price
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     and the number of Warrant Shares shall be subject to adjustment from time
     to time as provided in this Paragraph 4.

     In the event that any adjustment of the Exercise Price as required herein
     results in a fraction of a cent, such Exercise Price shall be rounded up to
     the nearest cent.

(f)  Adjustment of Exercise Price and Number of Shares upon Issuance of Common
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     Stock.  Except as otherwise provided in Paragraphs 4(c) and 4(e) hereof, if
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     and whenever on or after the Issue Date of this Warrant, the Company issues
     or sells, or in accordance with Paragraph 4(b) hereof is deemed to have
     issued or sold, any shares of Common Stock for no consideration or for a
     consideration per share (before deduction of reasonable expenses or
     commissions or underwriting discounts or allowances in connection
     therewith) less than the greater of (1) the Market Price (as hereinafter
     defined) and (2) then effective Exercise Price on the date of issuance (or
     deemed issuance) of such Common Stock (a "Dilutive Issuance"), then
     immediately upon the Dilutive Issuance, the Exercise Price will be reduced
     to a price determined by multiplying the Exercise Price in effect
     immediately prior to the Dilutive Issuance by a fraction, (i) the numerator
     of which is an amount equal to the sum of (x) the number of shares of
     Common Stock actually outstanding immediately prior to the Dilutive
     Issuance, plus (y) the quotient of the aggregate consideration, calculated
     as set forth in Paragraph 4(b) hereof, received by the Company upon such
     Dilutive Issuance divided by the greater of (1) the Market Price and (2)
     the Exercise Price in effect immediately prior to the Dilutive Issuance,
     and (ii) the denominator of which is the total number of shares of Common
     Stock Deemed Outstanding (as defined below) immediately after the Dilutive
     Issuance.

(g)  Effect on Exercise Price of Certain Events.  For purposes of determining
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     the adjusted Exercise Price under Paragraph 4(a) hereof, the following will
     be applicable:

(i)  Issuance of Rights or Options.  If the Company in any manner issues or
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     grants any warrants, rights or options, whether or not immediately
     exercisable, to subscribe for or to purchase Common Stock or other
     securities convertible into or exchangeable for Common Stock ("Convertible
     Securities") (such warrants, rights and options to purchase Common Stock or
     Convertible Securities are hereinafter referred to as "Options") and the
     price per share for which Common Stock is issuable upon the exercise of
     such Options is less than the greater of (1) the Market Price and (2) the
     Exercise Price on the date of issuance or grant of such Options, then the
     maximum total number of shares of Common Stock issuable upon the exercise
     of all such Options will, as of the date of the issuance or grant of such
     Options, be deemed to be outstanding and to have been issued and sold by
     the Company for such price per share.  For purposes of the preceding
     sentence, the "price per share for which Common Stock is issuable upon the
     exercise of such Options" is determined by dividing (i) the total amount,
     if any, received or receivable by the Company as consideration for the
     issuance or granting of all such Options, plus the minimum aggregate amount
     of additional consideration, if any, payable to the Company upon the
     exercise of all such Options, plus, in the case of Convertible Securities
     issuable upon the exercise of such Options, the minimum
<PAGE>

     aggregate amount of additional consideration payable upon the conversion or
     exchange thereof at the time such Convertible Securities first become
     convertible or exchangeable, by (ii) the maximum total number of shares of
     Common Stock issuable upon the exercise of all such Options (assuming full
     conversion of Convertible Securities, if applicable). No further adjustment
     to the Exercise Price will be made upon the actual issuance of such Common
     Stock upon the exercise of such Options or upon the conversion or exchange
     of Convertible Securities issuable upon exercise of such Options.

(i)  Issuance of Convertible Securities.  If the Company in any manner issues or
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     sells any Convertible Securities, whether or not immediately convertible
     (other than where the same are issuable upon the exercise of Options) and
     the price per share for which Common Stock is issuable upon such conversion
     or exchange is less than the greater of (1) the Market Price and (2) the
     Exercise Price on the date of issuance of such Convertible Securities, then
     the maximum total number of shares of Common Stock issuable upon the
     conversion or exchange of all such Convertible Securities will, as of the
     date of the issuance of such Convertible Securities, be deemed to be
     outstanding and to have been issued and sold by the Company for such price
     per share.  For the purposes of the preceding sentence, the "price per
     share for which Common Stock is issuable upon such conversion or exchange"
     is determined by dividing (i) the total amount, if any, received or
     receivable by the Company as consideration for the issuance or sale of all
     such Convertible Securities, plus the minimum aggregate amount of
     additional consideration, if any, payable to the Company upon the
     conversion or exchange thereof at the time such Convertible Securities
     first become convertible or exchangeable, by (ii) the maximum total number
     of shares of Common Stock issuable upon the conversion or exchange of all
     such Convertible Securities.  No further adjustment to the Exercise Price
     will be made upon the actual issuance of such Common Stock upon conversion
     or exchange of such Convertible Securities.

(i)  Change in Option Price or Conversion Rate.  If there is a change at any
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     time in (i) the amount of additional consideration payable to the Company
     upon the exercise of any Options; (ii) the amount of additional
     consideration, if any, payable to the Company upon the conversion or
     exchange of any Convertible Securities; or (iii) the rate at which any
     Convertible Securities are convertible into or exchangeable for Common
     Stock (other than under or by reason of provisions designed to protect
     against dilution), the Exercise Price in effect at the time of such change
     will be readjusted to the Exercise Price which would have been in effect at
     such time had such Options or Convertible Securities still outstanding
     provided for such changed additional consideration or changed conversion
     rate, as the case may be, at the time initially granted, issued or sold.

(i)  Treatment of Expired Options and Unexercised Convertible Securities.  If,
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     in any case, the total number of shares of Common Stock issuable upon
     exercise of any Option or upon conversion or exchange of any Convertible
     Securities is not, in fact, issued and the rights to exercise such Option
     or to convert or exchange such
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     Convertible Securities shall have expired or terminated, the Exercise Price
     then in effect will be readjusted to the Exercise Price which would have
     been in effect at the time of such expiration or termination had such
     Option or Convertible Securities, to the extent outstanding immediately
     prior to such expiration or termination (other than in respect of the
     actual number of shares of Common Stock issued upon exercise or conversion
     thereof), never been issued.

(i)  Calculation of Consideration Received.  If any Common Stock, Options or
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     Convertible Securities are issued, granted or sold for cash, the
     consideration received therefor for purposes of this Warrant will be the
     amount received by the Company therefor, before deduction of reasonable
     commissions, underwriting discounts or allowances or other reasonable
     expenses paid or incurred by the Company in connection with such issuance,
     grant or sale.  In case any Common Stock, Options or Convertible Securities
     are issued or sold for a consideration part or all of which shall be other
     than cash, the amount of the consideration other than cash received by the
     Company will be the fair value of such consideration, except where such
     consideration consists of securities, in which case the amount of
     consideration received by the Company will be the Market Price thereof as
     of the date of receipt.  In case any Common Stock, Options or Convertible
     Securities are issued in connection with any acquisition, merger or
     consolidation in which the Company is the surviving corporation, the amount
     of consideration therefor will be deemed to be the fair value of such
     portion of the net assets and business of the non-surviving corporation as
     is attributable to such Common Stock, Options or Convertible Securities, as
     the case may be.  The fair value of any consideration other than cash or
     securities will be determined in good faith by the Board of Directors of
     the Company.

(i)  Exceptions to Adjustment of Exercise Price.  No adjustment to the Exercise
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     Price will be made (i) upon the exercise of any warrants, options or
     convertible securities granted, issued and outstanding on the date of
     issuance of this Warrant; (ii) upon the grant or exercise of any stock or
     options which may hereafter be granted or exercised under any employee
     benefit plan of the Company now existing or to be implemented in the
     future, so long as the issuance of such stock or options is approved by a
     majority of the independent members of the Board of Directors of the
     Company or a majority of the members of a committee of independent
     directors established for such purpose; or (iii) upon the exercise of the
     Warrants.

(a)  Subdivision or Combination of Common Stock.  If the Company at any time
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     subdivides (by any stock split, stock dividend, recapitalization,
     reorganization, reclassification or otherwise) the shares of Common Stock
     acquirable hereunder into a greater number of shares, then, after the date
     of record for effecting such subdivision, the Exercise Price in effect
     immediately prior to such subdivision will be proportionately reduced.  If
     the Company at any time combines (by reverse stock split, recapitalization,
     reorganization, reclassification or otherwise) the shares of Common Stock
     acquirable hereunder into a smaller number of shares,
<PAGE>

     then, after the date of record for effecting such combination, the Exercise
     Price in effect immediately prior to such combination will be
     proportionately increased.

(b)  Adjustment in Number of Shares.  Upon each adjustment of the Exercise Price
     ------------------------------
     pursuant to the provisions of this Paragraph 4, the number of shares of
     Common Stock issuable upon exercise of this Warrant shall be adjusted by
     multiplying a number equal to the Exercise Price in effect immediately
     prior to such adjustment by the number of shares of Common Stock issuable
     upon exercise of this Warrant immediately prior to such adjustment and
     dividing the product so obtained by the adjusted Exercise Price.

(c)  Consolidation, Merger or Sale.  In case of any consolidation of the Company
     -----------------------------
     with, or merger of the Company into any other corporation, or in case of
     any sale or conveyance of all or substantially all of the assets of the
     Company other than in connection with a plan of complete liquidation of the
     Company, then as a condition of such consolidation, merger or sale or
     conveyance, adequate provision will be made whereby the holder of this
     Warrant will have the right to acquire and receive upon exercise of this
     Warrant in lieu of the shares of Common Stock immediately theretofore
     acquirable upon the exercise of this Warrant, such shares of stock,
     securities or assets as may be issued or payable with respect to or in
     exchange for the number of shares of Common Stock immediately theretofore
     acquirable and receivable upon exercise of this Warrant had such
     consolidation, merger or sale or conveyance not taken place.  In any such
     case, the Company will make appropriate provision to insure that the
     provisions of this Paragraph 4 hereof will thereafter be applicable as
     nearly as may be in relation to any shares of stock or securities
     thereafter deliverable upon the exercise of this Warrant.  The Company will
     not effect any consolidation, merger or sale or conveyance unless prior to
     the consummation thereof, the successor or acquiring entity (if other than
     the Company) and, if an entity different from the successor or acquiring
     entity, the entity whose capital stock or assets the holders of the Common
     Stock of the Company are entitled to receive as a result of such
     consolidation, merger or sale or conveyance assumes by written instrument
     the obligations under this Paragraph 4 and the obligations to deliver to
     the holder of this Warrant such shares of stock, securities or assets as,
     in accordance with the foregoing provisions, the holder may be entitled to
     acquire.

(d)  Distribution of Assets.  In case the Company shall declare or make any
     ----------------------
     distribution of its assets (including cash) to holders of Common Stock as a
     partial liquidating dividend, by way of return of capital or otherwise,
     then, after the date of record for determining stockholders entitled to
     such distribution, but prior to the date of distribution, the holder of
     this Warrant shall be entitled upon exercise of this Warrant for the
     purchase of any or all of the shares of Common Stock subject hereto, to
     receive the amount of such assets which would have been payable to the
     holder had such holder been the holder of such shares of Common Stock on
     the record date for the determination of stockholders entitled to such
     distribution.

(e)  Notice of Adjustment.  Upon the occurrence of any event which requires any
     --------------------
     adjustment of the Exercise Price, then, and in each such case, the Company
     shall give notice thereof to the holder of this Warrant, which notice shall
     state the Exercise Price resulting from such adjustment and the increase or
     decrease in the number of Warrant Shares purchasable at such price upon
     exercise, setting forth in reasonable detail the method of calculation and
     the facts upon which such calculation is based.  Such calculation shall be
     certified by the chief financial officer of the Company.
<PAGE>

(f)  Minimum Adjustment of Exercise Price.  No adjustment of the Exercise Price
     ------------------------------------
     shall be made in an amount of less than 1% of the Exercise Price in effect
     at the time such adjustment is otherwise required to be made, but any such
     lesser adjustment shall be carried forward and shall be made at the time
     and together with the next subsequent adjustment which, together with any
     adjustments so carried forward, shall amount to not less than 1% of such
     Exercise Price.

(g)  No Fractional Shares.  No fractional shares of Common Stock are to be
     --------------------
     issued upon the exercise of this Warrant.  If the exercise of this Warrant
     would result in a fractional share of Common Stock, such fractional share
     shall be disregarded and the number of shares of Common Stock issuable upon
     exercise of the Warrant shall be the next higher number of shares.

(h)  Other Notices.  In case at any time:
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(i)  the Company shall declare any dividend upon the Common Stock payable in
     shares of stock of any class or make any other distribution (including
     dividends or distributions payable in cash out of retained earnings) to the
     holders of the Common Stock;

(i)  the Company shall offer for subscription pro rata to the holders of the
     Common Stock any additional shares of stock of any class or other rights;

(i)  there shall be any capital reorganization of the Company, or
     reclassification of the Common Stock, or consolidation or merger of the
     Company with or into, or sale of all or substantially all its assets to,
     another corporation or entity; or

(i)  there shall be a voluntary or involuntary dissolution, liquidation or
     winding-up of the Company;

then, in each such case, the Company shall give to the holder of this Warrant
(a) notice of the date on which the books of the Company shall close or a record
shall be taken for determining the holders of Common Stock entitled to receive
any such dividend, distribution, or subscription rights or for determining the
holders of Common Stock entitled to vote in respect of any such reorganization,
reclassification, consolidation, merger, sale, dissolution, liquidation or
winding-up and (b) in the case of any such reorganization, reclassification,
consolidation, merger, sale, dissolution, liquidation or winding-up, notice of
the date (or, if not then known, a reasonable approximation thereof by the
Company) when the same shall take place.  Such notice shall also specify the
date on which the holders of Common Stock shall be entitled to receive such
dividend, distribution, or subscription rights or to exchange their Common Stock
for stock or other securities or property deliverable upon such reorganization,
reclassification, consolidation, merger, sale, dissolution, liquidation, or
winding-up, as the case may be.  Such notice shall be given at least 30 days
prior to the record date or the date on which the Company's books are closed in
respect thereto.  Failure to give any such notice or any defect therein shall
not affect the validity of the proceedings referred to in clauses (i), (ii),
(iii) and (iv) above.

(a)  Certain Events.  If any event occurs of the type contemplated by the
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     adjustment provisions of this Paragraph 4 but not expressly provided for by
     such provisions, the Company
<PAGE>

     will give notice of such event as provided in Paragraph 4(g) hereof, and
     the Company's Board of Directors will make an appropriate adjustment in the
     Exercise Price and the number of shares of Common Stock acquirable upon
     exercise of this Warrant so that the rights of the Holder shall be neither
     enhanced nor diminished by such event.

(b)  Certain Definitions.
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(i)  "Common Stock Deemed Outstanding" shall mean the number of shares of Common
      -------------------------------
     Stock actually outstanding (not including shares of Common Stock held in
     the treasury of the Company), plus (x) pursuant to Paragraph 4(b)(i)
     hereof, the maximum total number of shares of Common Stock issuable upon
     the exercise of Options, as of the date of such issuance or grant of such
     Options, if any, and (y) pursuant to Paragraph 4(b)(ii) hereof, the maximum
     total number of shares of Common Stock issuable upon conversion or exchange
     of Convertible Securities, as of the date of issuance of such Convertible
     Securities, if any.

(i)  "Market Price," as of any date, (i) means the average of the last reported
      ------------
     sale prices for the shares of Common Stock on the AMEX for the five (5)
     trading days immediately preceding such date as reported by Bloomberg
     Financial Markets or an equivalent reliable reporting service mutually
     acceptable to and hereafter designated by the holder of this Warrant and
     the Company ("Bloomberg"), or (ii) if the AMEX is not the principal trading
     market for the shares of Common Stock, the average of the last reported
     sale prices on the principal trading market for the Common Stock during the
     same period as reported by Bloomberg, or (iii) if market value cannot be
     calculated as of such date on any of the foregoing bases, the Market Price
     shall be the fair market value as reasonably determined in good faith by
     (a) the Board of Directors of the Corporation or, at the option of a
     majority-in-interest of the holders of the outstanding Warrants by (b) an
     independent investment bank of nationally recognized standing in the
     valuation of businesses similar to the business of the corporation. The
     manner of determining the Market Price of the Common Stock set forth in the
     foregoing definition shall apply with respect to any other security in
     respect of which a determination as to market value must be made hereunder.

(i)  "Common Stock," for purposes of this Paragraph 4, includes the Common
      ------------
     Stock, par value $.001 per share, and any additional class of stock of the
     Company having no preference as to dividends or distributions on
     liquidation, provided that the shares purchasable pursuant to this Warrant
     shall include only shares of Common Stock, par value $.001 per share, in
     respect of which this Warrant is exercisable, or shares resulting from any
     subdivision or combination of such Common Stock, or in the case of any
     reorganization, reclassification, consolidation, merger, or sale of the
     character referred to in Paragraph 4(e) hereof, the stock or other
     securities or property provided for in such Paragraph.

1.   Issue Tax.  The issuance of certificates for Warrant Shares upon the
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exercise of this Warrant shall be made without charge to the holder of this
Warrant or such shares for any issuance tax or other costs in respect thereof,
provided that the Company shall not be required to
<PAGE>

pay any tax which may be payable in respect of any transfer involved in the
issuance and delivery of any certificate in a name other than the holder of this
Warrant.

2.   No Rights or Liabilities as a Shareholder.  This Warrant shall not
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entitle the holder hereof to any voting rights or other rights as a shareholder
of the Company.  No provision of this Warrant, in the absence of affirmative
action by the holder hereof to purchase Warrant Shares, and no mere enumeration
herein of the rights or privileges of the holder hereof, shall give rise to any
liability of such holder for the Exercise Price or as a shareholder of the
Company, whether such liability is asserted by the Company or by creditors of
the Company.

3.   Transfer, Exchange, and Replacement of Warrant.
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(a)  Restriction on Transfer.  This Warrant and the rights granted to the holder
     -----------------------
     hereof are transferable, in whole or in part, upon surrender of this
     Warrant, together with a properly executed assignment in the form attached
     hereto, at the office or agency of the Company referred to in Paragraph
     7(e) below, provided, however, that any transfer or assignment shall be
     subject to the conditions set forth in Paragraph 7(f) hereof and to the
     applicable provisions of the Securities Purchase Agreement.  Until due
     presentment for registration of transfer on the books of the Company, the
     Company may treat the registered holder hereof as the owner and holder
     hereof for all purposes, and the Company shall not be affected by any
     notice to the contrary.  Notwithstanding anything to the contrary contained
     herein, the registration rights described in Paragraph 8 are assignable
     only in accordance with the provisions of that certain Registration Rights
     Agreement, dated as of October 11, 2000, by and among the Company and the
     other signatories thereto (the "Registration Rights Agreement").

(b)  Warrant Exchangeable for Different Denominations.  This Warrant is
     ------------------------------------------------
     exchangeable, upon the surrender hereof by the holder hereof at the office
     or agency of the Company referred to in Paragraph 7(e) below, for new
     Warrants of like tenor representing in the aggregate the right to purchase
     the number of shares of Common Stock which may be purchased hereunder, each
     of such new Warrants to represent the right to purchase such number of
     shares as shall be designated by the holder hereof at the time of such
     surrender.

(c)  Replacement of Warrant.  Upon receipt of evidence reasonably satisfactory
     ----------------------
     to the Company of the loss, theft, destruction, or mutilation of this
     Warrant and, in the case of any such loss, theft, or destruction, upon
     delivery of an indemnity agreement reasonably satisfactory in form and
     amount to the Company, or, in the case of any such mutilation, upon
     surrender and cancellation of this Warrant, the Company, at its expense,
     will execute and deliver, in lieu thereof, a new Warrant of like tenor.

(d)  Cancellation; Payment of Expenses.  Upon the surrender of this Warrant in
     ---------------------------------
     connection with any transfer, exchange, or replacement as provided in this
     Paragraph 7, this Warrant shall be promptly canceled by the Company.  The
     Company shall pay all taxes (other than securities transfer taxes) and all
     other expenses (other than legal expenses, if any, incurred by the Holder
     or transferees) and charges payable in connection with the preparation,
     execution, and delivery of Warrants pursuant to this Paragraph 7.

(e)  Register.  The Company shall maintain, at its principal executive offices
     --------
     (or such other office or agency of the Company as it may designate by
     notice to the holder hereof), a register for this Warrant, in which the
     Company shall record the name and address of the person in whose name this
     Warrant has been issued, as well as the name and address of each transferee
     and each prior owner of this Warrant.
<PAGE>

(f)  Exercise or Transfer Without Registration.  If, at the time of the
     -----------------------------------------
     surrender of this Warrant in connection with any exercise, transfer, or
     exchange of this Warrant, this Warrant (or, in the case of any exercise,
     the Warrant Shares issuable hereunder), shall not be registered under the
     Securities Act and under applicable state securities or blue sky laws, the
     Company may require, as a condition of allowing such exercise, transfer, or
     exchange, (i) that the holder or transferee of this Warrant, as the case
     may be, furnish to the Company a written opinion of counsel, which opinion
     and counsel are acceptable to the Company, to the effect that such
     exercise, transfer, or exchange may be made without registration under said
     Act and under applicable state securities or blue sky laws, (ii) that the
     holder or transferee execute and deliver to the Company an investment
     letter in form and substance acceptable to the Company and (iii) that the
     transferee be an "accredited investor" as defined in Rule 501(a)
     promulgated under the Securities Act; provided that no such opinion, letter
     or status as an "accredited investor" shall be required in connection with
     a transfer pursuant to Rule 144 under the Securities Act.  The first holder
     of this Warrant, by taking and holding the same, represents to the Company
     that such holder is acquiring this Warrant for investment and not with a
     view to the distribution thereof.

4.   Registration Rights.  The initial holder of this Warrant (and certain
     -------------------
assignees thereof) is entitled to the benefit of such registration rights in
respect of the Warrant Shares as are set forth in Section 2 of the Registration
Rights Agreement.

5.   Notices.  All notices, requests, and other communications required or
     -------
permitted to be given or delivered hereunder to the holder of this Warrant shall
be in writing, and shall be personally delivered, or shall be sent by certified
or registered mail or by recognized overnight mail courier, postage prepaid and
addressed, to such holder at the address shown for such holder on the books of
the Company, or at such other address as shall have been furnished to the
Company by notice from such holder. All notices, requests, and other
communications required or permitted to be given or delivered hereunder to the
Company shall be in writing, and shall be personally delivered, or shall be sent
by certified or registered mail or by recognized overnight mail courier, postage
prepaid and addressed, to the office of the Company at 12500 Network Blvd.,
Suite 407, San Antonio, Texas 78249, Attention: H. Douglas Saathoff, Chief
Financial Officer, or at such other address as shall have been furnished to the
holder of this Warrant by notice from the Company. Any such notice, request, or
other communication may be sent by facsimile, but shall in such case be
subsequently confirmed by a writing personally delivered or sent by certified or
registered mail or by recognized overnight mail courier as provided above. All
notices, requests, and other communications shall be deemed to have been given
either at the time of the receipt thereof by the person entitled to receive such
notice at the address of such person for purposes of this Paragraph 9, or, if
mailed by registered or certified mail or with a recognized overnight mail
courier upon deposit with the United States Post Office or such overnight mail
courier, if postage is prepaid and the mailing is properly addressed, as the
case may be.

6.   Governing Law.  THIS WARRANT SHALL BE GOVERNED BY AND CONSTRUED IN
     -------------
ACCORDANCE WITH THE LAWS OF THE STATE OF DELAWARE APPLICABLE TO AGREEMENTS MADE
AND TO BE PERFORMED IN THE STATE OF DELAWARE (WITHOUT REGARD TO PRINCIPLES OF
CONFLICT OF LAWS).  BOTH PARTIES IRREVOCABLY CONSENT TO THE EXCLUSIVE
JURISDICTION OF THE UNITED STATES FEDERAL COURTS AND THE STATE COURTS LOCATED IN
<PAGE>

DELAWARE WITH RESPECT TO ANY SUIT OR PROCEEDING BASED ON OR ARISING UNDER THIS
AGREEMENT, THE AGREEMENTS ENTERED INTO IN CONNECTION HEREWITH OR THE
TRANSACTIONS CONTEMPLATED HEREBY OR THEREBY AND IRREVOCABLY AGREE THAT ALL
CLAIMS IN RESPECT OF SUCH SUIT OR PROCEEDING MAY BE DETERMINED IN SUCH COURTS.
BOTH PARTIES IRREVOCABLY WAIVE THE DEFENSE OF AN INCONVENIENT FORUM TO THE
MAINTENANCE OF SUCH SUIT OR PROCEEDING.  BOTH PARTIES FURTHER AGREE THAT SERVICE
OF PROCESS UPON A PARTY MAILED BY FIRST CLASS MAIL SHALL BE DEEMED IN EVERY
RESPECT EFFECTIVE SERVICE OF PROCESS UPON THE PARTY IN ANY SUCH SUIT OR
PROCEEDING.  NOTHING HEREIN SHALL AFFECT EITHER PARTY'S RIGHT TO SERVE PROCESS
IN ANY OTHER MANNER PERMITTED BY LAW.  BOTH PARTIES AGREE THAT A FINAL NON-
APPEALABLE JUDGMENT IN ANY SUCH SUIT OR PROCEEDING SHALL BE CONCLUSIVE AND MAY
BE ENFORCED IN OTHER JURISDICTIONS BY SUIT ON SUCH JUDGMENT OR IN ANY OTHER
LAWFUL MANNER.

7.   Miscellaneous.
     -------------

(a)  Amendments.  This Warrant and any provision hereof may only be amended by
     ----------
     an instrument in writing signed by the Company and the holder hereof.

(b)  Descriptive Headings.  The descriptive headings of the several paragraphs
     --------------------
     of this Warrant are inserted for purposes of reference only, and shall not
     affect the meaning or construction of any of the provisions hereof.

(a)  Cashless Exercise.  Notwithstanding anything to the contrary contained in
     -----------------
     this Warrant, if the resale of the Warrant Shares by the holder is not then
     registered pursuant to an effective registration statement under the
     Securities Act, this Warrant may be exercised by presentation and surrender
     of this Warrant to the Company at its principal executive offices with a
     written notice of the holder's intention to effect a cashless exercise,
     including a calculation of the number of shares of Common Stock to be
     issued upon such exercise in accordance with the terms hereof (a "Cashless
     Exercise").  In the event of a Cashless Exercise, in lieu of paying the
     Exercise Price in cash, the holder shall surrender this Warrant for that
     number of shares of Common Stock determined by multiplying the number of
     Warrant Shares to which it would otherwise be entitled by a fraction, the
     numerator of which shall be the difference between the then current Market
     Price per share of the Common Stock and the Exercise Price,  and the
     denominator of which shall be the then current Market Price per share of
     Common Stock.

(b)  Remedies.  The Company acknowledges that a breach by it of its obligations
     --------
     hereunder will cause irreparable harm to the holder of this Warrant by
     vitiating the intent and purpose of the transactions contemplated hereby.
     Accordingly, the Company acknowledges that the remedy at law for a breach
     of its obligations under this Warrant will be inadequate and agrees, in the
     event of a breach or threatened breach by the Company of the provisions of
     this Warrant, that the holder of this Warrant shall be entitled, in
     addition to all other available remedies in law or in equity, to an
     injunction or injunctions to prevent or cure any breaches of the provisions
     of this Agreement and to enforce specifically the terms and provisions of
     this Warrant, without the necessity of showing economic loss and without
     any bond or other security being required.
<PAGE>

                 [REMAINDER OF PAGE INTENTIONALLY LEFT BLANK]
<PAGE>

     IN WITNESS WHEREOF, the Company has caused this Warrant to be signed by its
duly authorized officer.

                         AMERICAN TELESOURCE INTERNATIONAL, INC.

                         By: /c/ H. Douglas Saathoff
                             -----------------------
                             H. Douglas Saathoff
                             Senior Vice President and Chief Financial Officer

                             Dated as of October 11, 2000
<PAGE>

                          FORM OF EXERCISE AGREEMENT

                                                       Dated:  ________ __, 200_

To: AMERICAN TELESOURCE INTERNATIONAL, INC.

     The undersigned, pursuant to the provisions set forth in the within
Warrant, hereby agrees to purchase ________ shares of Common Stock covered by
such Warrant, and makes payment herewith in full therefor at the price per share
provided by such Warrant in cash or by certified or official bank check in the
amount of, or, if the resale of such Common Stock by the undersigned is not
currently registered pursuant to an effective registration statement under the
Securities Act of 1933, as amended, by surrender of securities issued by the
Company (including a portion of the Warrant) having a market value (in the case
of a portion of this Warrant, determined in accordance with Section 11(c) of the
Warrant) equal to $_________.  Please issue a certificate or certificates for
such shares of Common Stock in the name of and pay any cash for any fractional
share to:

                              Name:

                              Signature:_________________

                              Address:___________________

                              ___________________________

                              ___________________________

Note:  The above signature should  correspond exactly with the name on the face
       of the within Warrant.

and, if said number of shares of Common Stock shall not be all the shares
purchasable under the within Warrant, a new Warrant is to be issued in the name
of said undersigned covering the balance of the shares purchasable thereunder
less any fraction of a share paid in cash.
<PAGE>

                              FORM OF ASSIGNMENT

     FOR VALUE RECEIVED, the undersigned hereby sells, assigns, and transfers
all the rights of the undersigned under the within Warrant, with respect to the
number of shares of Common Stock covered thereby set forth hereinbelow, to:

<TABLE>
<CAPTION>
Name of Assignee                             Address                       No of Shares
-------------------------------  -------------------------------  -------------------------------
<S>                              <C>                              <C>

</TABLE>

, and hereby irrevocably constitutes and appoints ______________
________________________ as agent and attorney-in-fact to transfer said Warrant
on the books of the within-named corporation, with full power of substitution in
the premises.

Dated:  ________ __, 200_

In the presence of:

_________________________

                              Name:__________________

Signature:_______________

Title of Signing Officer or Agent (if any):

Address:______________

______________________

______________________

Note:  The above signature should correspond exactly with the name on the face
       of the within Warrant.<PAGE>

                                                                     EXHIBIT 4.1

                                           As amended through September 20, 2000

                               pcOrder.com, Inc.

                           1999 STOCK INCENTIVE PLAN

     1.   Purposes of the Plan.  The purposes of this Stock Incentive 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)  "Affiliate" and "Associate" shall have the respective
                     ---------       ---------
meanings ascribed to such terms in Rule 12b-2 promulgated under the Exchange
Act.

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

               (d)  "Award" means the grant of an Option, SAR, Dividend
                     -----
Equivalent Right, Restricted Stock, Performance Unit, Performance Share, or
other right or benefit under the Plan.

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

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

               (g)  "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 Administrator 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
Award issued to the Grantee under the Plan may be exercised or purchased.

               (h)  "Change in Control" means a change in ownership or control
                     -----------------
of the Company effected through either of the following transactions:

                         (i)  the direct or indirect acquisition by any person
or related group of persons (other than an acquisition from or by the Company or
by a Company-sponsored employee benefit plan or by a person that directly or
indirectly controls, is controlled by, or is under common control with, the
Company) 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 pursuant to
a tender or exchange offer made directly to the Company's stockholders which a
majority of the Continuing Directors who are not Affiliates or Associates of the
offeror do not recommend such stockholders accept, or

                                       1
<PAGE>

                       (ii)  a change in the composition of the Board over a
period of thirty-six (36) months or less such that a majority of the Board
members (rounded up to the next whole number) ceases, by reason of one or more
contested elections for Board membership, to be comprised of individuals who are
Continuing Directors.

               (i)  "Class A Common Stock" means the class A common stock of the
                     --------------------
Company.

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

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

               (l)  "Company" means pcOrder.com, Inc., a Delaware corporation.
                     -------

               (m)  "Consultant" means any person (other than an Employee or,
                     ----------
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.

               (n)  "Continuing Directors" means members of the Board who either
                     --------------------
(i) have been Board members continuously for a period of at least thirty-six
(36) months or (ii) have been Board members for less than thirty-six (36) months
and were elected or nominated for election as Board members by at least a
majority of the Board members described in clause (i) who were still in office
at the time such election or nomination was approved by the Board.

               (o)  "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 between locations of the Company or 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 Award 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.

               (p)  "Corporate Transaction" means any of the following
                     ---------------------
transactions:

                       (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)  an 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 (whether or not in a
transaction also constituting a Change in Control), but excluding any such
transaction that the Administrator determines shall not be a Corporate
Transaction.

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

                                       2
<PAGE>

               (r)  "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.

               (s)  "Dividend Equivalent Right" means a right entitling the
                     -------------------------
Grantee to compensation measured by dividends paid with respect to Class A
Common Stock.

               (t)  "Effective Termination" means the occurrence after a
                     ---------------------
Corporate Transaction, Change in Control or a Related Entity Disposition of any
of the following events or conditions:

                       (i)   (A) a change in the Grantee's status, title,
position or responsibilities which represents an adverse change from the
Grantee's status, title, position or responsibilities as in effect at any time
within six (6) months preceding the date of a Corporate Transaction, Change in
Control or Related Entity Disposition or at any time thereafter or (B) the
assignment to the Grantee of any duties or responsibilities which are
inconsistent with the Optionee's status, title, position or responsibilities as
in effect at any time within six (6) months preceding the date of a Corporate
Transaction, Change in Control or Related Entity Disposition or at any time
thereafter;

                       (ii)  reduction in the Grantee's base salary to a level
below that in effect at any time within six (6) months preceding the date of a
Corporate Transaction, Change in Control or Related Entity Disposition or at any
time thereafter; or

                       (iii) requiring the Grantee to be based at any place
outside a 50-mile radius from the Grantee's job location or residence prior to
the Corporate Transaction, Change in Control or Related Entity Disposition,
except for reasonably required travel on business which is not materially
greater than such travel requirements prior to the Corporate Transaction, Change
in Control or Related Entity Disposition.

               (u)  "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.

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

               (w)  "Fair Market Value" means, as of any date, the value of
                     -----------------
Class A Common Stock determined as follows:

                       (i)   Where there exists a public market for the Class A
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 Class A Common Stock or the
Nasdaq National Market, whichever is applicable or (B) if the Class A 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
Class A Common Stock of the type described in (i), above, the Fair Market Value
thereof shall be determined by the Administrator in good faith.

               (x)  "Grantee" means an Employee, Director or Consultant who
                     -------
receives an Award pursuant to an Award Agreement under the Plan.

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

                                       3
<PAGE>

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

               (aa) "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.

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

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

               (dd) "Performance Shares" means Shares or an Award denominated in
                     ------------------
Shares which may be earned in whole or in part upon attainment of performance
criteria established by the Administrator.

               (ee) "Performance Units" means an Award which may be earned in
                     -----------------
whole or in part upon attainment of performance criteria established by the
Administrator and which may be settled for cash, Shares or other securities or a
combination of cash, Shares or other securities as established by the
Administrator.

               (ff) "Plan" means this 1999 Stock Incentive Plan.
                     ----

               (gg) "Registration Date" means the first to occur of (i) the
                     -----------------
closing of the first sale to the general public of (A) the Class A 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 Class A 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, on or
prior to the date of consummation of such Corporate Transaction, the Securities
and Exchange Commission under the Securities Act of 1933, as amended.

               (hh) "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.

               (ii) "Related Entity Disposition" means the sale, distribution or
                     --------------------------
other disposition by the Company, a Parent or a Subsidiary of all or
substantially all of the interests of the Company, a Parent or a Subsidiary in
any Related Entity effected by a sale, merger or consolidation or other
transaction involving that Related Entity or the sale of all or substantially
all of the assets of that Related Entity.

               (jj) "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.

               (kk) "Rule 16b-3" means Rule 16b-3 promulgated under the Exchange
                     ----------
Act or any successor thereto.

               (ll) "SAR" means a stock appreciation right entitling the Grantee
                     ---
to Shares or cash compensation, as established by the Administrator, measured by
appreciation in the value of Class A Common Stock.

               (mm) "Share" means a share of the Class A Common Stock.
                     -----

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

                                       4
<PAGE>

     3.   Stock Subject to the Plan.
          -------------------------

               (a)  Subject to the provisions of Section 10, below, the maximum
aggregate number of Shares which may be issued pursuant to all Awards (including
Incentive Stock Options) is 3,000,000 Shares, plus an annual increase to be
added on the first day of the Company's fiscal year beginning in 2000 of the
number of Shares equal to five (5%) of the number of shares of all classes of
common stock of the Company outstanding as of such date or a lesser number of
Shares determined by the Administrator, less the number of Shares issued or
subject to options outstanding under the Company's 2000 Nonstatutory Stock
Option Plan from time to time. Notwithstanding the foregoing, subject to the
provisions of Section 10, below, of the number of Shares specified above, the
maximum aggregate number of Shares available for grant of Incentive Stock
Options shall be 1,500,000 Shares, plus an annual increase to be added on the
first day of the Company's fiscal year beginning in 2000 of the number of Shares
equal to the lesser of (i) 500,000 Shares, (ii) two percent (2%) of the number
of shares of all classes of common stock of the Company outstanding as of such
date, or (iii) a lesser number of Shares determined by the Administrator. The
Shares to be issued pursuant to Awards may be authorized, but unissued, or
reacquired Class A Common Stock.

               (b)  Any Shares covered by an Award (or portion of an Award)
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. If any unissued Shares are
retained by the Company upon exercise of an Award in order to satisfy the
exercise price for such Award or any withholding taxes due with respect to such
Award, such retained Shares subject to such Award shall become available for
future issuance under the Plan (unless the Plan has terminated). Shares that
actually have been issued under the Plan pursuant to an Award 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.
                    ------------------

                       (i)   Administration with Respect to Directors and
                             --------------------------------------------
Officers. With respect to grants of Awards to Directors or Employees who are
--------
also Officers or Directors of the Company, the Plan shall be administered by (A)
the Board or (B) a Committee designated by the Board, which Committee shall be
constituted in such a manner as to satisfy the Applicable Laws and to permit
such grants and related transactions under the Plan to be exempt from Section
16(b) of the Exchange Act in accordance with Rule 16b-3. Once appointed, such
Committee shall continue to serve in its designated capacity until otherwise
directed by the Board.

                       (ii)  Administration With Respect to Consultants and
                             ----------------------------------------------
Other Employees. With respect to grants of Awards to Employees or Consultants
---------------
who are neither Directors nor Officers of the Company, the Plan shall be
administered by (A) the Board or (B) a Committee designated by the Board, which
Committee shall be constituted in such a manner as to satisfy the Applicable
Laws. Once appointed, such Committee shall continue to serve in its designated
capacity until otherwise directed by the Board. The Board may authorize one or
more Officers to grant such Awards and may limit such authority as the Board
determines from time to time.

                       (iii) Administration Errors.  In the event an Award is
                             ---------------------
granted in a manner inconsistent with the provisions of this subsection (a),
such Award shall be presumptively valid as of its grant date to the extent
permitted by the Applicable Laws.

               (b)  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 Awards may be granted from time to time hereunder;

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

                                       5
<PAGE>

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

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

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

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

                       (vii)  to construe and interpret the terms of the Plan
and Awards granted pursuant to the Plan, including without limitation, any
notice of Award or Award Agreement, granted pursuant to the Plan;

                       (viii) to establish additional terms, conditions, rules
or procedures to accommodate the rules or laws of applicable foreign
jurisdictions and to afford Grantees favorable treatment under such laws;
provided, however, that no Award 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; and

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

               (c)  Effect of Administrator's Decision.  All decisions,
                    ----------------------------------
determinations and interpretations of the Administrator shall be conclusive and
binding on all persons.

     5.   Eligibility.  Awards 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 Award may, if otherwise eligible,
be granted additional Awards. Awards 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 Awards.
          ------------------------------

               (a)  Type of Awards.  The Administrator is authorized under the
                    --------------
Plan to award any type of arrangement to an Employee, Director or Consultant
that is not inconsistent with the provisions of the Plan and that by its terms
involves or might involve the issuance of (i) Shares, (ii) an Option, a SAR or
similar right with a fixed or variable price related to the Fair Market Value of
the Shares and with an exercise or conversion privilege related to the passage
of time, the occurrence of one or more events, or the satisfaction of
performance criteria or other conditions, or (iii) any other security with the
value derived from the value of the Shares. Such awards include, without
limitation, Options, SARs, sales or bonuses of Restricted Stock, Dividend
Equivalent Rights, Performance Units or Performance Shares, and an Award may
consist of one such security or benefit, or two (2) or more of them in any
combination or alternative.

               (b)  Designation of Award.  Each Award shall be designated in the
                    --------------------
Award Agreement. In the case of an Option, the Option shall be designated 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 date the Option with respect to such Shares is granted.

               (c)  Conditions of Award.  Subject to the terms of the Plan, the
                    -------------------
Administrator shall determine the provisions, terms, and conditions of each
Award including, but not limited to, the Award vesting schedule,

                                       6
<PAGE>

repurchase provisions, rights of first refusal, forfeiture provisions, form of
payment (cash, Shares, or other consideration) upon settlement of the Award,
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 Award Agreement.

               (d)  Acquisitions and Other Transactions.  The Administrator may
                    -----------------------------------
issue Awards under the Plan in settlement, assumption or substitution for,
outstanding awards or obligations to grant future awards 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.

               (e)  Deferral of Award 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 Award,
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 Award. 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.

               (f)  Award Exchange Programs. The Administrator may establish one
                    -----------------------
or more programs under the Plan to permit selected Grantees to exchange an Award
under the Plan for one or more other types of Awards under the Plan on such
terms and conditions as determined by the Administrator from time to time.

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

               (h)  Early Exercise.  The Award 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 Award prior to full
vesting of the Award. 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.

               (i)  Term of Award.  The term of each Award shall be the term
                    -------------
stated in the Award Agreement, provided, however, that the term of an Incentive
Stock Option 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 Award Agreement.

               (j)  Transferability of Awards.  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 Awards shall be transferable to the
extent provided in the Award Agreement.

               (k)  Time of Granting Awards. The date of grant of an Award shall
                    -----------------------
for all purposes be the date on which the Administrator makes the determination
to grant such Award, 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 Award is so granted within a reasonable time after the
date of such grant.

     7.   Award Exercise or Purchase Price, Consideration, Taxes and Reload
          -----------------------------------------------------------------
Options.
-------

                                       7
<PAGE>

               (a)  Exercise or Purchase Price.  The exercise or purchase price,
                    --------------------------
if any, for an Award 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 other Awards, such price as is
determined by the Administrator.

                       (iii) Notwithstanding the foregoing provisions of this
Section 7(a), in the case of an Award issued pursuant to Section 6(d), above,
the exercise or purchase price for the Award 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 Award
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;

                       (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
Award) 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 Award shall
be exercised (but only to the extent that such exercise of the Award 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)   with respect to Options, 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,

                                       8
<PAGE>

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 Award, the Company shall withhold or collect
from Grantee an amount sufficient to satisfy such tax obligations.

               (d)  Reload Options.  In the event the exercise price or tax
                    --------------
withholding of an Option is satisfied by the Company or the Grantee's employer
withholding Shares otherwise deliverable to the Grantee, the Administrator may
issue the Grantee an additional Option, with terms identical to the Award
Agreement under which the Option was exercised, but at an exercise price as
determined by the Administrator in accordance with the Plan.

     8.   Exercise of Award.
          -----------------

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

                       (i)   Any Award 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 Award Agreement.

                       (ii)  An Award 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 Award by the person entitled to exercise the Award and full
payment for the Shares with respect to which the Award 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 Award,
notwithstanding the exercise of an Option or other Award. The Company shall
issue (or cause to be issued) such stock certificate promptly upon exercise of
the Award. 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
provided in the Award Agreement or Section 10, below.

               (b)  Exercise of Award Following Termination of Continuous
                    -----------------------------------------------------
Service.
-------

                       (i)   An Award may not be exercised after the termination
date of such Award set forth in the Award Agreement and may be exercised
following the termination of a Grantee's Continuous Service only to the extent
provided in the Award Agreement.

                       (ii)  Where the Award Agreement permits a Grantee to
exercise an Award following the termination of the Grantee's Continuous Service
for a specified period, the Award shall terminate to the extent not exercised on
the last day of the specified period or the last day of the original term of the
Award, whichever occurs first.

                       (iii) Any Award designated as an Incentive Stock Option
to the extent not exercised within the time permitted by law for the exercise of
Incentive Stock Options following the termination of a Grantee's Continuous
Service shall convert automatically to a Non-Qualified Stock Option and
thereafter shall be exercisable as such to the extent exercisable by its terms
for the period specified in the Award Agreement.

               (c)  Buyout Provisions.  The Administrator may at any time offer
                    -----------------
to buy out for a payment in cash or Shares, an Award previously granted, based
on such terms and conditions as the Administrator shall establish and
communicate to the Grantee at the time that such offer is made.

     9.   Conditions Upon Issuance of Shares.
          ----------------------------------

               (a)  Shares shall not be issued pursuant to the exercise of an
Award unless the exercise of such Award 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.

                                       9
<PAGE>

               (b)  As a condition to the exercise of an Award, the Company may
require the person exercising such Award 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.  Subject to any required
          ------------------------------------------
action by the shareholders of the Company, the number of Shares covered by each
outstanding Award, and the number of Shares which have been authorized for
issuance under the Plan but as to which no Awards have yet been granted or which
have been returned to the Plan, the exercise or purchase price of each such
outstanding Award, 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
any 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 Class A 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 Award.

     11.  Corporate Transactions/Changes in Control/Related Entity Dispositions.
          ---------------------------------------------------------------------
Except as may be provided in an Award Agreement:

     In the event of any Corporate Transaction, each Award which is at the time
               outstanding under the Plan automatically shall become vested and
               exercisable and be released from any restrictions on transfer
               (other than transfer restrictions applicable to Incentive Stock
               Options) and repurchase or forfeiture rights, immediately prior
               to the specified effective date of such Corporate Transaction, as
               to one half (1/2) of the then unvested Shares at the time
               represented by such Award. Effective upon the consummation of the
               Corporate Transaction, all outstanding Awards under the Plan
               shall terminate. However, all such Awards shall not terminate if
               the Awards are, in connection with the Corporate Transaction,
               assumed by the successor corporation or Parent thereof. In
               addition, an outstanding Award under the Plan shall not so
               partially vest and be exercisable and released from such
               limitations if and to the extent: (i) such Award is, in
               connection with the Corporate Transaction, either assumed by the
               successor corporation or Parent thereof or replaced with a
               comparable Award with respect to shares of the capital stock of
               the successor corporation or Parent thereof or (ii) such Award is
               to be replaced with a cash incentive program of the successor
               corporation which preserves the compensation element of such
               Award existing at the time of the Corporate Transaction and
               provides for subsequent payout in accordance with the same
               vesting schedule applicable to such Award; provided, however,
               that such Award (if assumed), the replacement Award (if
               replaced), or the cash incentive program automatically shall
               become vested, exercisable and payable and be released from any
               restrictions on transfer (other than transfer restrictions
               applicable to Incentive Stock Options) and repurchase or
               forfeiture rights as to one half (1/2) of the then unvested
               shares (or cash payments) at the time represented by such Award
               immediately upon the Grantee incurring an Effective Termination
               or upon termination of the Grantee's Continuous Service
               (substituting the successor employer corporation for "Company or
               Related Entity" for the definition of "Continuous Service") if
               such Continuous Service is terminated by the successor company
               without Cause or the Grantee incurs such Effective Termination
               within twelve (12) months of the Corporate Transaction. The
               determination of Award comparability above shall be made by the
               Administrator, and its determination shall be final, binding and
               conclusive.

     Following a Change in Control (other than a Change in Control which also is
               a Corporate Transaction) and (i) upon the termination of the
               Continuous Service of a Grantee if such Continuous Service is
               terminated by the Company or Related Entity without Cause within
               twelve (12) months of a

                                       10
<PAGE>

               Change in Control or (ii) upon the Grantee incurring an Effective
               Termination within twelve (12) months of a Change in Control,
               each Award of such Grantee which is at the time outstanding under
               the Plan automatically shall become vested and exercisable and be
               released from any restrictions on transfer (other than transfer
               restrictions applicable to Incentive Stock Options) and
               repurchase or forfeiture rights as to one half (1/2) of the then
               unvested Shares at the time represented by such Award,
               immediately upon the termination of such Continuous Service or
               the date on which the Grantee incurs an Effective Termination.

     Effective upon the consummation of a Related Entity Disposition, for
               purposes of the Plan and all Awards, the Continuous Service of
               each Grantee who is at the time engaged primarily in service to
               the Related Entity involved in such Related Entity Disposition
               shall be deemed to terminate and each Award of such Grantee which
               is at the time outstanding under the Plan automatically shall
               become vested and exercisable and be released from any
               restrictions on transfer (other than transfer restrictions
               applicable to Incentive Stock Options) and repurchase or
               forfeiture rights as to one half (1/2) of the unvested Shares at
               the time represented by such Award and be exercisable in
               accordance with the terms of the Award Agreement evidencing such
               Award. However, such Continuous Service shall be not be deemed to
               terminate if such Award is, in connection with the Related Entity
               Disposition, assumed by the successor entity or its Parent. In
               addition, such Continuous Service shall not be deemed to
               terminate and an outstanding Award under the Plan shall not so
               partially vest and be exercisable and released from such
               limitations if and to the extent: (i) such Award is, in
               connection with the Related Entity Disposition, either to be
               assumed by the successor entity or its parent or to be replaced
               with a comparable Award with respect to interests in the
               successor entity or its parent or (ii) such Award is to be
               replaced with a cash incentive program of the successor entity
               which preserves the compensation element of such Award existing
               at the time of the Related Entity Disposition and provides for
               subsequent payout in accordance with the same vesting schedule
               applicable to such Award; provided, however, that such Award (if
               assumed), the replacement Award (if replaced), or the cash
               incentive program automatically shall become vested, exercisable
               and payable and be released from any restrictions on transfer
               (other than transfer restrictions applicable to Incentive Stock
               Options) and repurchase or forfeiture rights as to one half (1/2)
               of the then unvested shares (or cash payments) at the time
               represented by such Award immediately upon the Grantee incurring
               an Effective Termination or upon termination of the Grantee's
               Continuous Service (substituting the successor employer entity
               for "Company or Related Entity" for the definition of "Continuous
               Service") if such Continuous Service is terminated by the
               successor entity without Cause or the Grantee incurs such
               Effective Termination within twelve (12) months of the Related
               Entity Disposition. The determination of Award comparability
               above shall be made by the Administrator, and its determination
               shall be final, binding and conclusive.

     The portion of any Incentive Stock Option accelerated under this Section 11
               in connection with a Corporate Transaction, Change in Control or
               Related Entity Disposition shall remain exercisable as an
               Incentive Stock Option under the Code only to the extent the
               $100,000 dollar limitation of Section 422(d) of the Code is not
               exceeded. To the extent such dollar limitation is exceeded, the
               accelerated excess portion of such Option shall be exercisable as
               a Non-Qualified Stock Option.

     12.  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 17, below, and Applicable
Laws, Awards may be granted under the Plan upon its becoming effective.

     13.  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.

                                       11
<PAGE>

               (b) No Award 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 12, above) shall not affect
Awards already granted, and such Awards 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.

     14.  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.

     15.  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.

     16.  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, Awards 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.

     17.  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
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 within the twelve (12) month period provided above, all Incentive
Stock Options previously granted under the Plan shall be exercisable as Non-
Qualified Stock Options.

     18.  Limitation of Award Grants to Executive Officers.  The Company may
          ------------------------------------------------
not in any one fiscal year grant Awards under the Plan for more than 750,000
shares to any executive officer of the Company.

                                       12

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