Document:

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                                                                   EXHIBIT 10.24

                              EMPLOYMENT AGREEMENT

       THIS AGREEMENT is entered into as of the 18th day of September, 2000
(the "Effective Date"), by and between Donald Listwin (the "Executive") and
Phone.com, Inc., a Delaware corporation (the "Corporation").

       For ease of reference, this Agreement is divided into the following
parts:

FIRST PART:   TERM OF EMPLOYMENT, DUTIES AND SCOPE, COMPENSATION AND BENEFITS
              DURING EMPLOYMENT

SECOND PART:  COMPENSATION AND BENEFITS IN CASE OF INVOLUNTARY TERMINATION

THIRD PART:   COMPENSATION AND BENEFITS IN CASE OF A CHANGE IN CONTROL

FOURTH PART:  PARACHUTE PAYMENTS, CONFIDENTIAL INFORMATION, SUCCESSORS,
              MISCELLANEOUS PROVISIONS, SIGNATURE PAGE
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FIRST PART:   TERM OF EMPLOYMENT, DUTIES AND SCOPE, COMPENSATION AND BENEFITS
              DURING EMPLOYMENT

Section 1.  Term of Employment
------------------------------

(a)  At-Will.  Subject to the terms and conditions of this Agreement,
     -------
     Executive's employment with the Corporation is "at will" and Executive or
     the Corporation are free to terminate the employment relationship at any
     time, with or without Cause upon at least thirty (30) days written notice.

(b)  Termination for Cause.  The Corporation may terminate the Executive's
     ---------------------
     employment at any time for Cause.  For all purposes under this Agreement,
     "Cause" shall mean (1) a willful failure by the Executive to substantially
     perform the Executive's duties under this Agreement, other than a failure
     resulting from the Executive's complete or partial incapacity due to
     physical or mental illness or impairment, (2) a willful act by the
     Executive that constitutes gross misconduct and that is materially
     injurious to the Corporation, (3) a willful breach by the Executive of a
     material provision of this Agreement, (4) a material and willful violation
     of a federal or state law or regulation applicable to the business of the
     Corporation that is materially and demonstrably injurious to the
     Corporation, or (5) a material failure to achieve such reasonable financial
     and other performance measures as shall be agreed upon by the Compensation
     Committee of the Board of Directors and the Executive; all as determined by
     the Compensation Committee of the Board of Directors in good faith;
     provided, however, that failure of the parties to reasonably agree to such
     performance measures shall not be grounds for termination for cause.__No
     act, or failure to act, by the Executive shall be considered "willful"
     unless committed without good faith and without a reasonable belief that
     the act or omission was in the Corporation's best interest.

(c)  Termination for Disability.  The Corporation may terminate the Executive's
     --------------------------
     employment for Disability by giving the Executive not less than thirty-(30)
     day's advance written notice.  For all purposes under this Agreement,
     "Disability" shall mean that the Executive, at the time the notice is
     given, has been unable to perform the Executive's duties under this
     Agreement for a period of not less than six (6) consecutive months as a
     result of the Executive's incapacity due to physical or mental illness.  In
     the event that the Executive resumes the performance of substantially all
     of the Executive's duties under this Agreement before the termination of
     the Executive's employment under this Section 1 becomes effective, the
     notice of termination shall automatically be deemed to have been revoked.

(d)  Termination of Agreement.  This Agreement shall expire when all obligations
     of the parties hereunder have been satisfied.
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Section 2.  Duties and Scope of Employment
------------------------------------------

(a)  Position.  The Corporation agrees to employ the Executive in the positions
     --------
     of President and Chief Executive Officer ("PCEO").  Executive shall be
     given such duties, responsibilities and authorities as are appropriate to
     his position.  Executive shall also serve as a Director on the
     Corporation's Board of Directors (the "Board").

(b)  Obligations.  During the Agreement, the Executive shall devote the
     -----------
     Executive's full business efforts and time to the business and affairs of
     the Corporation as needed to carry out his duties and responsibilities
     hereunder subject to the overall supervision of the Board.  The foregoing
     shall not preclude the Executive from engaging in appropriate civic,
     charitable or religious activities or from devoting a reasonable amount of
     time to private investments or from serving on the boards of directors of
     other entities, as long as such activities and service do not interfere or
     conflict with the Executive's responsibilities to the Corporation.

Section 3.  Base Compensation
-----------------------------

During the Agreement, the Corporation agrees to pay the Executive as
compensation for services a base salary at the annual rate of $250,000, or at
such higher rate as the Compensation Committee of the Board may determine from
time to time.  Such salary shall be payable in accordance with the standard
payroll procedures of the Corporation. The annual compensation specified in this
Section 3, together with any increases in such compensation that the
Compensation Committee of the Board may grant from time to time, is referred to
in this Agreement as "Base Compensation."

Section 4.  Incentive Compensation
----------------------------------

During the Agreement, the Corporation shall award the Executive annual incentive
compensation ("Incentive Compensation") based upon a target which shall be at
least 50% of the Base Compensation, with the actual annual incentive award
determined in accordance with the achievement of financial and other performance
measures.  Executive shall also have the opportunity to earn two (2) times the
annual target based upon attainment of objectives defined by the Compensation
Committee. A minimum bonus equal to at least the target bonus shall be
guaranteed and paid in full as soon as practicable after the end of fiscal year
2001.  Any compensation paid to the Executive as Incentive Compensation shall be
in addition to the Base Compensation.  The Compensation Committee of the Board
will review the Executive's Incentive Compensation annually to ensure that the
target remains competitive.

Section 5.  Equity Compensation
-------------------------------

(a)  Stock Options.  Executive will be granted six (6) million stock options to
     -------------
     purchase the Corporation's common stock in accordance with the terms and
     conditions of the applicable stock option agreements associated therewith.
     The per share exercise price for such options shall be the closing trading
     price on the Effective Date.  Such options shall
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     vest as to twenty-five percent (25%) of the options on the first
     anniversary of the Effective Date and ratably thereafter at the rate of
     1/48 of such option award per month.

(b)  Other Equity Awards.  The Executive shall be considered for awards under
     -------------------
     the Corporation's existing and any new compensation and benefit plans in
     order to ensure that Executive's long-term incentives are competitive.

Section 6.  Executive Benefits
------------------------------

During the Agreement, the Executive shall be eligible to participate in all
employee and executive benefit plans and executive compensation programs
maintained by the Corporation, including (without limitation) savings or profit-
sharing plans, deferred compensation plans, stock option, incentive or other
bonus plans, life, disability, health, accident and other insurance programs,
and similar plans or programs.  Executive shall also be covered under the
Corporation's standard director and officer insurance and indemnification
programs.

Section 7.  Business Expenses and Travel
----------------------------------------

While rendering services to the Corporation, the Executive is authorized to
incur and shall be reimbursed for all necessary and reasonable travel,
entertainment and other business expenses.

Section 8.  Death or Disability
-------------------------------

If Executive's employment with the Corporation is terminated at any time due to
death or Disability, Executive shall receive (a) one (1) year of health
coverage, comparable to that provided to other senior executives of the
Corporation, for himself (if termination was due to Disability) and his family
and (b) continuance of life insurance coverage on his life for one (1) year
following termination (if termination was due to Disability).  To the extent
that the Corporation finds it undesirable to cover the Executive under the group
life insurance and health plans of the Corporation, the Corporation shall
provide the Executive (at its own expense) with the same level of coverage under
individual policies.
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SECOND PART:  COMPENSATION AND BENEFITS IN CASE OF INVOLUNTARY TERMINATION

Section 9.  Terminations
------------------------

This Second Part of the Agreement, consisting of Sections 9 through 10,
describes the benefits and compensation, if any, payable in case of a Qualifying
Termination of employment.  The Third Part of the Agreement, consisting of
Sections 11 and 12, describes benefits and compensation, if any, payable in case
of a Change in Control.

Section 10.  Termination Without Cause; Involuntary Termination
---------------------------------------------------------------

In the event that, during the Agreement, the Executive's employment terminates
in a Qualifying Termination, as defined in Section 10(a), then, after executing
the release of claims described in Section 10(c), the Executive shall be
entitled to receive the payments and benefits described in Section 8 and Section
10(b).

(a)  Qualifying Termination.  A Qualifying Termination occurs if:
     ----------------------

     (1)  The Corporation terminates the Executive's employment for any reason
          other than Cause, Death or Disability; or

     (2)  The Executive experiences an Involuntary Termination not resulting
          from a Change in Control.  For purposes of this Agreement, Involuntary
          Termination shall mean the occurrence of any of the following without
          the Executive's prior written consent:  (i) a greater than 10%
          reduction in Executive's base compensation, incentive compensation
          target and benefits except if a majority of the Board of Directors
          vote to reduce the salary of the Executive and the rest of the
          Corporation's executive officers by the same percentage amount for the
          same time period, (ii) a material change in Executive's status or his
          responsibilities (excluding loss of title as President of the
          Corporation), (iii) the Corporation's failure to continue Executive as
          its CEO, (iv) the Corporation's failure to nominate Executive for re-
          election as a member of the Board of Directors (unless Executive's
          employment is terminated for Cause), (v) if Executive is not at all
          times the Chief Executive Officer of the Corporation's ultimate parent
          entity (if any), or (vi) a requirement to relocate, except for office
          relocations that would not increase the Executive's one-way commute
          distance by more than thirty (30) miles.  For purposes of greater
          clarity, termination for Cause, death or Disability shall not give
          rise to an Involuntary Termination.

(b)  Payments and Benefits.  The Corporation shall pay to the Executive
     ---------------------
     following the date of termination of employment the following aggregate
     payments and benefits spread ratably over the succeeding twelve (12)
     months, in accordance with standard payroll procedures:

     (1)  One (1) times the Executive's Base Compensation in effect on the date
          of the termination of employment;
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     (2)  One (1) times the Executive's target Incentive Compensation for the
          year in which Executive's employment is terminated;

     (3)  50% of Executive's then unvested stock options shall become vested and
          Executive shall have one (1) year after the date of Qualifying
          Termination to exercise all vested options and Executive's remaining
          unvested options, if any, shall not expire until the earlier of (i)
          their original expiration date or (ii) one (1) year after the date of
          Qualifying Termination; and

     (4)  The same level of health and life insurance coverage provided under
          Section 8 above.  This coverage will be provided for one (1) year
          after termination of employment with COBRA benefits to begin
          thereafter.  The obligation of the Corporation to provide continued
          health and life insurance benefits under this Section 10 shall cease
          if Executive becomes employed by another employer and such employer
          provides the Executive with life insurance and health plan coverage
          that is comparable to the coverage contemplated by this Section 10.

(c)  Release of Claims.  As a condition to the receipt of the payments and
     -----------------
     benefits described in this Section 10, the Executive shall be required to
     execute a release of all claims arising out of the Executive's employment
     or the termination thereof including, but not limited to, any claim of
     discrimination under state or federal law, but excluding claims for
     indemnification from the Corporation under any indemnification agreement
     with the Corporation, its certificate of incorporation and by-laws or
     applicable law or claims for directors and officers' insurance coverage.

(d)  Conditions to Receipt of Payments and Benefits.  In view of Executive's
     ----------------------------------------------
     position and his access to Confidential Information, as a condition to the
     receipt of cash payments and health and life insurance benefits described
     in this Section 10, the Executive shall not, without the Corporation's
     written consent, directly or indirectly, alone or as a partner, joint
     venturer, officer, director, Executive, consultant, agent or stockholder
     (other than a less than 5% stockholder of a publicly traded company) (i)
     engage in any activity which is in competition with the business, the
     products or services of the Corporation (a list of competitors and
     competitive products and services, which may be updated, is attached
     hereto), (ii) solicit any of the Corporation's Executives, consultants or
     customers, (iii) hire any of the Corporation's Executives or consultants in
     an unlawful manner or actively encourage Executives or consultants to leave
     the Corporation, or (iv) otherwise breach his Confidential Information
     obligations.

(e)  No Mitigation.  Except as provided in Section 10(b)(4), the Executive shall
     -------------
     not be required to mitigate the amount of any payment or benefit
     contemplated by this Section 10, nor shall any such payment or benefit be
     reduced by any earnings or benefits that the Executive may receive from any
     other source.
<PAGE>

THIRD PART:  COMPENSATION AND BENEFITS IN CASE OF A CHANGE IN CONTROL

Section 11.  Change in Control
------------------------------

(a)  If Executive is still employed by the Corporation and there is a Change in
     Control, 50% of Executive's then unvested stock options shall become
     vested.  His remaining unvested stock options shall continue to vest at the
     same rate of vesting as before the Change in Control subject to Section
     11(b) below.

(b)  If a Qualifying Termination occurs in connection with a Change in Control
     or within eighteen (18) months after a Change in Control, the Executive
     will receive a cash severance payment equal to one (1) times the sum of his
     Base Compensation and target Incentive Compensation less any severance
     payments previously made under Section 10(b) above.  Such severance will be
     paid in a lump sum within ten (10) days of the Qualifying Termination.
     Executive shall receive the same health and life insurance benefits
     provided in Section 8.  Additionally, all of Executive's unvested stock
     options, if any, shall vest in full and Executive shall have one (1) year
     after the date of Qualifying Termination to exercise his vested options.

Section 12.  Definition of Change in Control
--------------------------------------------

For all purposes under this Agreement, "Change in Control" shall be as defined
below.

          (i) The stockholders of the Corporation approve an agreement for the
sale of all or substantially all of the assets of the Corporation to a person or
entity; or

          (ii) The stockholders of the Corporation approve a merger or
consolidation of the Corporation with any other corporation, other than a merger
or consolidation which would result in the voting securities of the Corporation
outstanding immediately prior thereto continuing to represent (either by
remaining outstanding or by being converted into voting securities of the
surviving entity) at least fifty percent (50%) of the total voting power
represented by the voting securities of the Corporation or such surviving entity
outstanding immediately after such merger or consolidation;

          (iii)  Completion of a tender or exchange offer or other transaction
or series of transactions by a person or entity that results in less than a
majority of the outstanding voting shares of the surviving corporation being
held, immediately after such transaction or series of transactions, by the
holders of the voting shares of the Corporation outstanding immediately prior to
such transaction or series of transactions.

     Notwithstanding the foregoing, a "Change in Control" shall not be deemed to
have occurred by virtue of the consummation of any transaction or series of
integrated transactions (i) immediately following which the record holders of
the common stock of the Corporation immediately prior to such transaction or
series of transactions continue to have substantially the

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same proportionate ownership in an entity which owns all or substantially all of
the assets of the Corporation immediately following such transaction or series
of transactions or (ii) involving the proposed merger between the Corporation
and Software.com, Inc.; or

               (iv)  Approval by the stockholders of the Corporation of a
          complete liquidation or dissolution of the Corporation.

                                       8
<PAGE>

FOURTH PART:  PARACHUTE PAYMENTS, CONFIDENTIAL INFORMATION, SUCCESSORS,
               MISCELLANEOUS PROVISIONS, SIGNATURE PAGE

Section 13.  Parachute Payments
-------------------------------

     In the event that the severance and other benefits provided for in this
Agreement or otherwise payable to the Executive (i) constitute "parachute
payments" within the meaning of Section 280G of the Internal Revenue Code of
1986, as amended (the "Code"), and (ii) but for this Section 13, would be
subject to the excise tax imposed by Section 4999 of the Code (or any
corresponding provisions of state income tax law), then the Executive's
severance benefits under Section 11 shall be either

          (a)  delivered in full, or

          (b) delivered as to such lesser extent which would result in no
portion of such severance benefits being subject to excise tax under Section
4999 of the Code, whichever of the foregoing amounts, taking into account the
applicable federal, state and local income taxes and the excise tax imposed by
Section 4999, results in the receipt by the Executive on an after-tax-basis, of
the greater amount of severance benefits, notwithstanding that all or some
portion of such severance benefits may be taxable under Section 4999 of the
Code.  Unless the Corporation and the Executive otherwise agree in writing, any
determination required under this Section 13 shall be made in writing by the
Corporation's accountants, whose determination shall be conclusive and binding
upon the Executive and the Corporation for all purposes.  For purposes of making
the calculations required by this Section 13, the accountants may make
reasonable assumptions and approximations concerning applicable taxes and may
rely on reasonable, good faith interpretations concerning the application of
Sections 280G and 4999 of the Code.  The Corporation and the Executive shall
furnish to the accountants such information and documents as the accountants may
reasonably request in order to make a determination under this Section 13.  The
Corporation shall bear all costs the accountants may reasonably incur in
connection with any calculations contemplated by this Section 13.  In the event
that subsection (a) above applies, then Executive shall be responsible for any
excise taxes imposed with respect to such severance and other benefits.  In the
event that subsection (b) above applies, then each benefit provided hereunder
shall be proportionately reduced to the extent necessary to avoid imposition of
such excise taxes.

Section 14.  Confidential Information
-------------------------------------

The Corporation and the Executive will enter into the Corporation's standard
Employee Inventions and Assignment Agreement which shall govern use by the
Executive of the Corporation's confidential information.

Section 15.  Successors
-----------------------

(a)  Corporation's Successors.  The Corporation shall require any successor
     ------------------------
     (whether direct or indirect and whether by purchase, lease, merger,
     consolidation, liquidation or otherwise)

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<PAGE>

     to all or substantially all of the Corporation's business and/or assets, by
     an agreement in substance and form satisfactory to the Executive, to assume
     this Agreement and to agree expressly to perform this Agreement in the same
     manner and to the same extent as the Corporation would be required to
     perform it in the absence of a succession. The Corporation's failure to
     obtain such agreement prior to the effectiveness of a succession shall be a
     breach of this Agreement and shall entitle the Executive to all of the
     compensation and benefits to which the Executive would have been entitled
     hereunder if the Corporation had involuntarily terminated the Executive's
     employment without Cause or Disability, on the date when such succession
     becomes effective. For all purposes under this Agreement, the term
     "Corporation" shall include any successor to the Corporation's business
     and/or assets that executes and delivers the assumption agreement described
     in this Section 15(a) or that becomes bound by this Agreement by operation
     of law.

(b)  Executive's Successors.  This Agreement and all rights of the Executive
     ----------------------
     hereunder shall inure to the benefit of, and be enforceable by, the
     Executive's personal or legal representatives, executors, administrators,
     successors, heirs, distributees, devisees and legatees.

Section 16.  Miscellaneous Provisions
-------------------------------------

(a)  Waiver.  No provision of this Agreement shall be modified, waived or
     ------
     discharged unless the modification, waiver or discharge is agreed to in
     writing and signed by the Executive and by an authorized officer of the
     Corporation (other than the Executive).  No waiver by either party of any
     breach of, or of compliance with, any condition or provision of this
     Agreement by the other party shall be considered a waiver of any other
     condition or provision or of the same condition or provision at another
     time.

(b)  Whole Agreement.  No agreements, representations or understandings (whether
     ---------------
     oral or written and whether express or implied) that are not expressly set
     forth in this Agreement have been made or entered into by either party with
     respect to the subject matter hereof.  In addition, the Executive hereby
     acknowledges and agrees that this Agreement, the stock option agreements
     referenced above, and the Employee Inventions and Assignment Agreement
     supersede in their entirety any agreements between the Executive and the
     Corporation in effect immediately prior to the effective date of this
     Agreement.  As of the Effective Date, any such agreement shall terminate
     without any further obligation by either party thereto, and the Executive
     hereby relinquishes any further rights that the Executive may have had
     under any such prior agreement.

(c)  Notice.  Notices and all other communications contemplated by this
     ------
     Agreement shall be in writing and shall be deemed to have been duly given
     when personally delivered or when mailed by U.S. registered or certified
     mail, return receipt requested and postage prepaid.  In the case of the
     Executive, mailed notices shall be addressed to the Executive at the home
     address that the Executive most recently communicated to the Corporation in

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<PAGE>

     writing.  In the case of the Corporation, mailed notices shall be addressed
     to its corporate headquarters, and all notices shall be directed to the
     attention of the Board.

(d)  No Setoff.  Except as provided in Section 10, there shall be no right of
     ---------
     setoff or counterclaim, with respect to any claim, debt or obligation,
     against payments to the Executive under this Agreement.

(e)  Choice of Law.  The validity, interpretation, construction and performance
     -------------
     of this Agreement shall be governed by the laws of the State of California,
     irrespective of California's choice-of-law principles.

(f)  Severability.  The invalidity or unenforceability of any provision or
     ------------
     provisions of this Agreement shall not affect the validity or
     enforceability of any other provision hereof, which shall remain in full
     force and effect.

(g)  Arbitration.  Except as otherwise provided in Section 13 and in the
     -----------
     enforcement of Section 14, any dispute or controversy arising out of the
     Executive's employment or the termination thereof, including, but not
     limited to, any claim of discrimination under state or federal law, shall
     be settled exclusively by arbitration in Palo Alto, California, in
     accordance with the rules of the American Arbitration Association then in
     effect.  Judgment may be entered on the arbitrator's award in any court
     having jurisdiction.

(h)  No Assignment of Benefits.  The rights of any person to payments or
     -------------------------
     benefits under this Agreement shall not be made subject to option or
     assignment, either by voluntary or involuntary assignment or by operation
     of law, including (without limitation) bankruptcy, garnishment, attachment
     or other creditor's process, and any action in violation of this Section
     16(h) shall be void.

(i)  Limitation of Remedies.  If the Executive's employment terminates for any
     ----------------------
     reason, the Executive shall not be entitled to any payments, benefits,
     damages, awards or compensation other than as provided by this Agreement.

(j)  Employment Taxes.  All payments made pursuant to this Agreement shall be
     ----------------
     subject to withholding of applicable taxes.

(k)  Benefit Coverage Non-Additive.  In the event that the Executive is entitled
     -----------------------------
     to life insurance and health plan coverage under more than one provision
     hereunder, only one provision shall apply, and neither the periods of
     coverage nor the amounts of benefits shall be additive.

(l)  Discharge of Responsibility. The payments under this Agreement, when made
     ---------------------------
     in accordance with the terms of this Agreement shall fully discharge all
     responsibilities of the Corporation to the Executive that existed at the
     time of termination of the Executive's employment.

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<PAGE>

(m)  Attorney and Consultant Fees.  The Corporation will pay for all reasonable
     ----------------------------
     fees incurred in connection with the negotiation and preparation of this
     Agreement.

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<PAGE>

IN WITNESS WHEREOF, each of the parties has executed this Agreement, in the case
------------------
of the Corporation by its duly authorized officer, as of the day and year first
above written.

                                     EXECUTIVE

                                             /s/ Donald Listwin
                                     -------------------------------------------
                                                 Donald Listwin

                                     PHONE.COM, INC.

                                     By    /s/ Alain Rossmann
                                        ---------------------------------------

                                     Its    Chairman
                                         --------------------------------------

                                       13<PAGE>

                                                                   Exhibit 10.25

                               SOFTWARE.COM, INC.

                                1995 STOCK PLAN

             (as amended and restated effective as of May 4, 1999)

1.   Purposes of the Plan.  The purposes of this 1995 Stock Plan, as amended,
     --------------------
are:

     .    to attract and retain the best available personnel for positions of
          substantial responsibility,

     .    to provide additional incentive to Employees, Directors and
          Consultants, and

     .    to promote the success of the Company's business.

     Options granted under the Plan may be Incentive Stock Options or
Nonstatutory Stock Options, as determined by the Administrator at the time of
grant.  Stock Purchase Rights may also be granted under the Plan.

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

     (a)  "Administrator" means the Board or any of its Committees as shall be
           -------------
administering the Plan, in accordance with Section 4 of the Plan.

     (b)  "Applicable Laws" means the requirements relating to the
           ---------------
administration of stock option plans under U. S. state corporate laws, U.S.
federal and state securities laws, the Code, any stock exchange or quotation
system on which the Common Stock is listed or quoted and the applicable laws of
any foreign country or jurisdiction where Options or Stock Purchase Rights are,
or will be, granted under the Plan.

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

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

     (e)  "Committee"  means a committee of Directors appointed by the Board in
           ---------
accordance with Section 4 of the Plan.

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

     (g)  "Company" means Software.com, Inc., a Delaware corporation.
           -------

     (h)  "Consultant" means any person, including an advisor, engaged by the
           ----------
Company or a Parent or Subsidiary to render services to such entity.

     (i)  "Director" means a member of the Board.
           --------
<PAGE>

     (j)  "Disability" means total and permanent disability as defined in
           ----------
Section 22(e)(3) of the Code.

     (k)  "Employee" means any person, including Officers and Directors,
           --------
employed by the Company or any Parent or Subsidiary of the Company. A Service
Provider shall not cease to be an Employee in the case of (i) any leave of
absence approved by the Company or (ii) transfers between locations of the
Company or between the Company, its Parent, any Subsidiary, or any successor.
For purposes of Incentive Stock Options, no such leave may exceed ninety days,
unless reemployment upon expiration of such leave is guaranteed by statute or
contract. If reemployment upon expiration of a leave of absence approved by the
Company is not so guaranteed, on the 181st day of such leave any Incentive Stock
Option held by the Optionee shall cease to be treated as an Incentive Stock
Option and shall be treated for tax purposes as a Nonstatutory Stock Option.
Neither service as a Director nor payment of a director's fee by the Company
shall be sufficient to constitute "employment" by the Company.

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

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

          (i)    If the Common Stock is listed on any established stock exchange
or a national market system, including without limitation the Nasdaq National
Market or The Nasdaq SmallCap Market of The Nasdaq Stock Market, its Fair Market
Value shall be the closing sales price for such stock (or the closing bid, if no
sales were reported) as quoted on such exchange or system for the last market
trading day prior to the time of determination, as reported in The Wall Street
Journal or such other source as the Administrator deems reliable;

          (ii)   If the Common Stock is regularly quoted by a recognized
securities dealer but selling prices are not reported, the Fair Market Value of
a Share of Common Stock shall be the mean between the high bid and low asked
prices for the Common Stock on the last market trading day prior to the day of
determination, as reported in The Wall Street Journal or such other source as
the Administrator deems reliable; or

          (iii)  In the absence of an established market for the Common Stock,
the Fair Market Value shall be determined in good faith by the Administrator.

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

     (o)  "Nonstatutory Stock Option" means an Option not intended to qualify
           -------------------------
as an Incentive Stock Option.

                                      -2-
<PAGE>

     (p)  "Notice of Grant" means a written or electronic notice evidencing
           ---------------
certain terms and conditions of an individual Option or Stock Purchase Right
grant. The Notice of Grant is part of the Option Agreement.

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

     (r)  "Option" means a stock option granted pursuant to the Plan.
           ------

     (s)  "Option Agreement" means an agreement between the Company and an
           ----------------
Optionee evidencing the terms and conditions of an individual Option grant. The
Option Agreement is subject to the terms and conditions of the Plan.

     (t)  "Option Exchange Program" means a program whereby outstanding Options
           -----------------------
are surrendered in exchange for Options with a lower exercise price.

     (u)  "Optioned Stock" means the Common Stock subject to an Option or Stock
           --------------
Purchase Right.

     (v)  "Optionee" means the holder of an outstanding Option or Stock Purchase
           --------
Right granted under the Plan.

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

     (x)  "Plan" means this 1995 Stock Plan, as amended.
           ----

     (y)  "Restricted Stock" means shares of Common Stock acquired pursuant to a
           ----------------
grant of Stock Purchase Rights under Section 11 of the Plan.

     (z)  "Restricted Stock Purchase Agreement" means a written agreement
           -----------------------------------
between the Company and the Optionee evidencing the terms and restrictions
applying to stock purchased under a Stock Purchase Right. The Restricted Stock
Purchase Agreement is subject to the terms and conditions of the Plan and the
Notice of Grant.

     (aa) "Rule 16b-3" means Rule 16b-3 of the Exchange Act or any successor to
           ----------
Rule 16b-3, as in effect when discretion is being exercised with respect to the
Plan.

     (bb) "Section 16(b) " means Section 16(b) of the Exchange Act.
           -------------

     (cc) "Service Provider" means an Employee, Director or Consultant.
           ----------------

     (dd) "Share" means a share of the Common Stock, as adjusted in accordance
           -----
with Section 13 of the Plan.

                                      -3-
<PAGE>

     (ee) "Stock Purchase Right" means the right to purchase Common Stock
           --------------------
pursuant to Section 11 of the Plan, as evidenced by a Notice of Grant.

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

     3.   Stock Subject to the Plan. Subject to the provisions of Section 13 of
          -------------------------
the Plan, the maximum aggregate number of Shares which may be optioned and sold
under the Plan is 12,448,931/1/ Shares, plus an annual increase to be added on
July 1 of each year beginning in 2000, equal to a lesser of (i) 5,000,000
shares, (ii) 4% of the outstanding shares on such date or (iii) a lesser amount
determined by the Board. The Shares may be authorized, but unissued, or
reacquired Common Stock.

     If an Option or Stock Purchase Right expires or becomes unexercisable
without having been exercised in full, or is surrendered pursuant to an Option
Exchange Program, the unpurchased Shares which were subject thereto shall become
available for future grant or sale under the Plan (unless the Plan has
terminated); provided, however, that Shares that have actually been issued under
             --------
the Plan, whether upon exercise of an Option or Right, shall not be returned to
the Plan and shall not become available for future distribution under the Plan,
except that if Shares of Restricted Stock are 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)    Procedure.
                 ---------

                 (i)    Multiple Administrative Bodies. The Plan may be
                        ------------------------------
administered by different Committees with respect to different groups of Service
Providers.

                 (ii)   Section 162(m). To the extent that the Administrator
                        --------------
determines it to be desirable to qualify Options granted hereunder as
"performance-based compensation" within the meaning of Section 162(m) of the
Code, the Plan shall be administered by a Committee of two or more "outside
directors" within the meaning of Section 162(m) of the Code.

                 (iii)  Rule 16b-3. To the extent desirable to qualify
                        ----------
transactions hereunder as exempt under Rule 16b-3, the transactions contemplated
hereunder shall be structured to satisfy the requirements for exemption under
Rule 16b-3.

                 (iv)   Other Administration. Other than as provided above, the
                        --------------------
Plan shall be administered by (A) the Board or (B) a Committee, which committee
shall be constituted to satisfy Applicable Laws.

          (b)    Powers of the Administrator. Subject to the provisions of the
                 ---------------------------
Plan, and in the case of a Committee, subject to the specific duties delegated
by the Board to such Committee, the Administrator shall have the authority, in
its discretion:

                                      -4-

/1/ Such number reflects the automatic increase of 1,948,931 shares on July 1,
    2000.
<PAGE>

                 (i)    to determine the Fair Market Value;

                 (ii)   to select the Service Providers to whom Options and
Stock Purchase Rights may be granted hereunder;

                 (iii)  to determine the number of shares of Common Stock to be
covered by each Option and Stock Purchase Right granted hereunder;

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

                 (v)    to determine the terms and conditions, not inconsistent
with the terms of the Plan, of any Option or Stock Purchase Right granted
hereunder. Such terms and conditions include, but are not limited to, the
exercise price, the time or times when Options or Stock Purchase Rights may be
exercised (which may be based on performance criteria), any vesting acceleration
or waiver of forfeiture restrictions, and any restriction or limitation
regarding any Option or Stock Purchase Right or the shares of Common Stock
relating thereto, based in each case on such factors as the Administrator, in
its sole discretion, shall determine;

                 (vi)   to reduce the exercise price of any Option or Stock
Purchase Right to the then current Fair Market Value if the Fair Market Value of
the Common Stock covered by such Option or Stock Purchase Right shall have
declined since the date the Option or Stock Purchase Right was granted;

                 (vii)  to institute an Option Exchange Program;

                 (viii) to construe and interpret the terms of the Plan and
awards granted pursuant to the Plan;

                 (ix)   to prescribe, amend and rescind rules and regulations
relating to the Plan, including rules and regulations relating to sub-plans
established for the purpose of qualifying for preferred tax treatment under
foreign tax laws;

                 (x)    to modify or amend each Option or Stock Purchase Right
(subject to Section 15(c) of the Plan), including the discretionary authority to
extend the post-termination exercisability period of Options longer than is
otherwise provided for in the Plan;

                 (xi)   to allow Optionees to satisfy withholding tax
obligations by electing to have the Company withhold from the Shares to be
issued upon exercise of an Option or Stock Purchase Right that number of Shares
having a Fair Market Value equal to the amount required to be withheld. The Fair
Market Value of the Shares to be withheld shall be determined on the date that
the amount of tax to be withheld is to be determined. All elections by an
Optionee to have Shares withheld for this purpose shall be made in such form and
under such conditions as the Administrator may deem necessary or advisable;

                                      -5-
<PAGE>

                 (xii)  to authorize any person to execute on behalf of the
Company any instrument required to effect the grant of an Option or Stock
Purchase Right previously granted by the Administrator;

                 (xiii) to make all other determinations deemed necessary or
advisable for administering the Plan.

          (c)    Effect of Administrator's Decision. The Administrator's
                 ----------------------------------
decisions, determinations and interpretations shall be final and binding on all
Optionees and any other holders of Options or Stock Purchase Rights.

     5.   Eligibility. Nonstatutory Stock Options and Stock Purchase Rights may
          -----------
be granted to Service Providers. Incentive Stock Options may be granted only to
Employees.

     6.   Limitations.
          -----------

          (a)    Each Option shall be designated in the Option Agreement as
either an Incentive Stock Option or a Nonstatutory Stock Option. However,
notwithstanding such designation, to the extent that the aggregate Fair Market
Value of the Shares with respect to which Incentive Stock Options are
exercisable for the first time by the Optionee during any calendar year (under
all plans of the Company and any Parent or Subsidiary) exceeds $100,000, such
Options shall be treated as Nonstatutory Stock Options. For purposes of this
Section 6(a), Incentive Stock Options shall be taken into account in the order
in which they were granted. The Fair Market Value of the Shares shall be
determined as of the time the Option with respect to such Shares is granted.

          (b)    Neither the Plan nor any Option or Stock Purchase Right shall
confer upon an Optionee any right with respect to continuing the Optionee's
relationship as a Service Provider with the Company, nor shall they interfere in
any way with the Optionee's right or the Company's right to terminate such
relationship at any time, with or without cause.

          (c)    The following limitations shall apply to grants of Options:

                 (i)   No Service Provider shall be granted, in any fiscal year
of the Company, Options to purchase more than 1,500,000 Shares.

                 (ii)   In connection with his or her initial service, a Service
Provider may be granted Options to purchase up to an additional 1,500,000 Shares
which shall not count against the limit set forth in subsection (i) above.

                 (iii)  The foregoing limitations shall be adjusted
proportionately in connection with any change in the Company's capitalization as
described in Section 13.

                 (iv)   If an Option is cancelled in the same fiscal year of the
Company in which it was granted (other than in connection with a transaction
described in Section 13), the cancelled Option will be counted against the
limits set forth in subsections (i) and (ii) above. For

                                      -6-
<PAGE>

this purpose, if the exercise price of an Option is reduced, the transaction
will be treated as a cancellation of the Option and the grant of a new Option.

     7.   Term of Plan. Subject to Section 19 of the Plan, the Plan shall become
          ------------
effective upon its adoption by the Board.  It shall continue in effect for a
term of ten (10) years unless terminated earlier under Section 15 of the Plan.

     8.   Term of Option.  The term of each Option shall be stated in the Option
          --------------
Agreement.  In the case of an Incentive Stock Option, the term shall be ten (10)
years from the date of grant or such shorter term as may be provided in the
Option Agreement.  Moreover, in the case of an Incentive Stock Option granted to
an Optionee who, at the time the Incentive Stock Option is granted, owns stock
representing more than ten percent (10%) of the total combined 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 or such
shorter term as may be provided in the Option Agreement.

     9.   Option Exercise Price and Consideration.
          ---------------------------------------

          (a)    Exercise Price. The per share exercise price for the Shares to
                 --------------
be issued pursuant to exercise of an Option shall be determined by the
Administrator, subject to the following:

                 (i)    In the case of an Incentive Stock Option

                        (A)  granted to an Employee who, at the time the
Incentive Stock 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 per Share exercise price shall be no less than 110% of the
Fair Market Value per Share on the date of grant.

                        (B)  granted to any Employee other than an Employee
described in paragraph (A) immediately above, the per Share exercise price shall
be no less than 100% of the Fair Market Value per Share on the date of grant.

                 (ii)   In the case of a Nonstatutory Stock Option, the per
Share exercise price shall be determined by the Administrator. In the case of a
Nonstatutory Stock Option intended to qualify as "performance-based
compensation" within the meaning of Section 162(m) of the Code, the per Share
exercise price shall be no less than 100% of the Fair Market Value per Share on
the date of grant.

                 (iii)  Notwithstanding the foregoing, Options may be granted
with a per Share exercise price of less than 100% of the Fair Market Value per
Share on the date of grant pursuant to a merger or other corporate transaction.

          (b)    Waiting Period and Exercise Dates. At the time an Option is
                 ---------------------------------
granted, the Administrator shall fix the period within which the Option may be
exercised and shall determine any conditions which must be satisfied before the
Option may be exercised.

                                      -7-
<PAGE>

          (c)    Form of Consideration. The Administrator shall determine the
                 ---------------------
acceptable form of consideration for exercising an Option, including the method
of payment. In the case of an Incentive Stock Option, the Administrator shall
determine the acceptable form of consideration at the time of grant. Such
consideration may consist entirely of:

                 (i)    cash;

                 (ii)   check;

                 (iii)  promissory note;

                 (iv)   other Shares which (A) in the case of Shares acquired
upon exercise of an option, have been owned by the Optionee for more than six
months on the date of surrender, and (B) have a Fair Market Value on the date of
surrender equal to the aggregate exercise price of the Shares as to which said
Option shall be exercised;

                 (v)    consideration received by the Company under a cashless
exercise program implemented by the Company in connection with the Plan;

                 (vi)   a reduction in the amount of any Company liability to
the Optionee, including any liability attributable to the Optionee's
participation in any Company-sponsored deferred compensation program or
arrangement;

                 (vii)  any combination of the foregoing methods of payment; or

                 (viii) such other consideration and method of payment for the
issuance of Shares to the extent permitted by Applicable Laws.

     10.  Exercise of Option.
          ------------------

          (a)    Procedure for Exercise; Rights as a Shareholder. Any Option
                 -----------------------------------------------
granted hereunder shall be exercisable according to the terms of the Plan and at
such times and under such conditions as determined by the Administrator and set
forth in the Option Agreement. Unless the Administrator provides otherwise,
vesting of Options granted hereunder shall be tolled during any unpaid leave of
absence. An Option may not be exercised for a fraction of a Share.

     An Option shall be deemed exercised when the Company receives: (i) written
or electronic notice of exercise (in accordance with the Option Agreement) from
the person entitled to exercise the Option, and (ii) full payment for the Shares
with respect to which the Option is exercised.  Full payment may consist of any
consideration and method of payment authorized by the Administrator and
permitted by the Option Agreement and the Plan.  Shares issued upon exercise of
an Option shall be issued in the name of the Optionee or, if requested by the
Optionee, in the name of the Optionee and his or her spouse.  Until the Shares
are issued (as evidenced by the appropriate entry on the books of the Company or
of a duly authorized transfer agent of the Company), no right to vote or receive
dividends or any other rights as a shareholder shall exist with respect to the
Optioned Stock,

                                      -8-
<PAGE>

notwithstanding the exercise of the Option. The Company shall issue (or cause to
be issued) such Shares promptly after the Option is exercised. No adjustment
will be made for a dividend or other right for which the record date is prior to
the date the Shares are issued, except as provided in Section 13 of the Plan.

     Exercising an Option in any manner shall decrease the number of Shares
thereafter available, both for purposes of the Plan and for sale under the
Option, by the number of Shares as to which the Option is exercised.

          (b)    Termination of Relationship as a Service Provider. If an
                 -------------------------------------------------
Optionee ceases to be a Service Provider, other than upon the Optionee's death
or Disability, the Optionee may exercise his or her Option within such period of
time as is specified in the Option Agreement to the extent that the Option is
vested on the date of termination (but in no event later than the expiration of
the term of such Option as set forth in the Option Agreement). In the absence of
a specified time in the Option Agreement, the Option shall remain exercisable
for three (3) months following the Optionee's termination. If, on the date of
termination, the Optionee is not vested as to his or her entire Option, the
Shares covered by the unvested portion of the Option shall revert to the Plan.
If, after termination, the Optionee does not exercise his or her Option within
the time specified by the Administrator, the Option shall terminate, and the
Shares covered by such Option shall revert to the Plan.

          (c)    Disability of Optionee. If an Optionee ceases to be a Service
                 ----------------------
Provider as a result of the Optionee's Disability, the Optionee may exercise his
or her Option within such period of time as is specified in the Option Agreement
to the extent the Option is vested on the date of termination (but in no event
later than the expiration of the term of such Option as set forth in the Option
Agreement). In the absence of a specified time in the Option Agreement, the
Option shall remain exercisable for twelve (12) months following the Optionee's
termination. If, on the date of termination, the Optionee is not vested as to
his or her entire Option, the Shares covered by the unvested portion of the
Option shall revert to the Plan. If, after termination, the Optionee does not
exercise his or her Option within the time specified herein, the Option shall
terminate, and the Shares covered by such Option shall revert to the Plan.

          (d)    Death of Optionee. If an Optionee dies while a Service
                 -----------------
Provider, the Option may be exercised within such period of time as is specified
in the Option Agreement (but in no event later than the expiration of the term
of such Option as set forth in the Notice of Grant), by the Optionee's estate or
by a person who acquires the right to exercise the Option by bequest or
inheritance, but only to the extent that the Option is vested on the date of
death. In the absence of a specified time in the Option Agreement, the Option
shall remain exercisable for twelve (12) months following the Optionee's
termination. If, at the time of death, the Optionee is not vested as to his or
her entire Option, the Shares covered by the unvested portion of the Option
shall immediately revert to the Plan. The Option may be exercised by the
executor or administrator of the Optionee's estate or, if none, by the person(s)
entitled to exercise the Option under the Optionee's will or the laws of descent
or distribution. If the Option is not so exercised within the time specified
herein, the Option shall terminate, and the Shares covered by such Option shall
revert to the Plan.

                                      -9-
<PAGE>

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

     11.  Stock Purchase Rights.
          ---------------------

          (a)    Rights to Purchase. Stock Purchase Rights may be issued either
                 ------------------
alone, in addition to, or in tandem with other awards granted under the Plan
and/or cash awards made outside of the Plan. After the Administrator determines
that it will offer Stock Purchase Rights under the Plan, it shall advise the
offeree in writing or electronically, by means of a Notice of Grant, of the
terms, conditions and restrictions related to the offer, including the number of
Shares that the offeree shall be entitled to purchase, the price to be paid, and
the time within which the offeree must accept such offer. The offer shall be
accepted by execution of a Restricted Stock Purchase Agreement in the form
determined by the Administrator.

          (b)    Repurchase Option. Unless the Administrator determines
                 -----------------
otherwise, the Restricted Stock Purchase Agreement shall grant the Company a
repurchase option exercisable upon the voluntary or involuntary termination of
the purchaser's service with the Company for any reason (including death or
Disability). The purchase price for Shares repurchased pursuant to the
Restricted Stock Purchase Agreement shall be the original price paid by the
purchaser and may be paid by cancellation of any indebtedness of the purchaser
to the Company. The repurchase option shall lapse at a rate determined by the
Administrator.

          (c)    Other Provisions. The Restricted Stock Purchase Agreement shall
                 ----------------
contain such other terms, provisions and conditions not inconsistent with the
Plan as may be determined by the Administrator in its sole discretion.

          (d)    Rights as a Shareholder. Once the Stock Purchase Right is
                 -----------------------
exercised, the purchaser shall have the rights equivalent to those of a
shareholder, and shall be a shareholder when his or her purchase is entered upon
the records of the duly authorized transfer agent of the Company. No adjustment
will be made for a dividend or other right for which the record date is prior to
the date the Stock Purchase Right is exercised, except as provided in Section 13
of the Plan.

     12.  Non-Transferability of Options and Stock Purchase Rights.  Unless
          --------------------------------------------------------
determined otherwise by the Administrator, an Option or Stock Purchase Right 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 Optionee, only by the Optionee.  If the
Administrator makes an Option or Stock Purchase Right transferable, such Option
or Stock Purchase Right shall contain such additional terms and conditions as
the Administrator deems appropriate.

     13.  Adjustments Upon Changes in Capitalization, Dissolution, Merger or
          ------------------------------------------------------------------
Asset Sale.
----------

          (a)    Changes in Capitalization. Subject to any required action by
                 -------------------------
the shareholders of the Company, the number of shares of Common Stock covered by
each outstanding Option and

                                      -10-
<PAGE>

Stock Purchase Right, and the number of shares of Common Stock which have been
authorized for issuance under the Plan but as to which no Options or Stock
Purchase Rights have yet been granted or which have been returned to the Plan
upon cancellation or expiration of an Option or Stock Purchase Right, as well as
the price per share of Common Stock covered by each such outstanding Option or
Stock Purchase Right, shall be proportionately adjusted for any increase or
decrease in the number of issued shares of Common Stock resulting from a stock
split, reverse stock split, stock dividend, combination or reclassification of
the Common Stock, or any other increase or decrease in the number of issued
shares of Common Stock effected without receipt of consideration by the Company;
provided, however, that conversion of any convertible securities of the Company
shall not be deemed to have been "effected without receipt of consideration."
Such adjustment shall be made by the Board, whose determination in that respect
shall be final, binding and conclusive. Except as expressly provided herein, no
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 thereof shall be made with respect to, the number or price of shares
of Common Stock subject to an Option or Stock Purchase Right.

          (b)    Dissolution or Liquidation. In the event of the proposed
                 --------------------------
dissolution or liquidation of the Company, the Administrator shall notify each
Optionee as soon as practicable prior to the effective date of such proposed
transaction. The Administrator in its discretion may provide for an Optionee to
have the right to exercise his or her Option until ten (10) days prior to such
transaction as to all of the Optioned Stock covered thereby, including Shares as
to which the Option would not otherwise be exercisable. In addition, the
Administrator may provide that any Company repurchase option applicable to any
Shares purchased upon exercise of an Option or Stock Purchase Right shall lapse
as to all such Shares, provided the proposed dissolution or liquidation takes
place at the time and in the manner contemplated. To the extent it has not been
previously exercised, an Option or Stock Purchase Right will terminate
immediately prior to the consummation of such proposed action.

          (c)    Merger or Asset Sale. In the event of a merger of the Company
                 --------------------
with or into another corporation, or the sale of substantially all of the assets
of the Company, each outstanding Option and Stock Purchase Right shall be
assumed or an equivalent option or right substituted by the successor
corporation or a Parent or Subsidiary of the successor corporation. If, in such
event, the Option or right is not assumed or substituted, the Option or right
shall terminate as of the date of the closing of the merger. For the purposes of
this paragraph, the Option or Stock Purchase Right shall be considered assumed
if, following the merger or sale of assets, the option or right confers the
right to purchase or receive, for each Share of Optioned Stock subject to the
Option or Stock Purchase Right immediately prior to the merger or sale of
assets, the consideration (whether stock, cash, or other securities or property)
received in the merger or sale of assets by holders of Common Stock for each
Share held on the effective date of the transaction (and if holders were offered
a choice of consideration, the type of consideration chosen by the holders of a
majority of the outstanding Shares); provided, however, that if such
consideration received in the merger or sale of assets is not solely common
stock of the successor corporation or its Parent, the Administrator may, with
the consent of the successor corporation, provide for the consideration to be
received upon the exercise of the Option or Stock Purchase Right, for each Share
of Optioned Stock subject to the Option or

                                      -11-
<PAGE>

Stock Purchase Right, to be solely common stock of the successor corporation or
its Parent equal in fair market value to the per share consideration received by
holders of Common Stock in the merger or sale of assets.

     14.  Date of Grant.  The date of grant of an Option or Stock Purchase Right
          -------------
shall be, for all purposes, the date on which the Administrator makes the
determination granting such Option or Stock Purchase Right, or such other later
date as is determined by the Administrator.  Notice of the determination shall
be provided to each Optionee within a reasonable time after the date of such
grant.

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

          (a)    Amendment and Termination. The Board may at any time amend,
                 -------------------------
alter, suspend or terminate the Plan.

          (b)    Shareholder Approval. The Company shall obtain shareholder
                 --------------------
approval of any Plan amendment to the extent necessary and desirable to comply
with Applicable Laws.

          (c)    Effect of Amendment or Termination. No amendment, alteration,
                 ----------------------------------
suspension or termination of the Plan shall impair the rights of any Optionee,
unless mutually agreed otherwise between the Optionee and the Administrator,
which agreement must be in writing and signed by the Optionee and the Company.
Termination of the Plan shall not affect the Administrator's ability to exercise
the powers granted to it hereunder with respect to Options granted under the
Plan prior to the date of such termination.

     16.  Conditions Upon Issuance of Shares.
          ----------------------------------

          (a)    Legal Compliance. Shares shall not be issued pursuant to the
                 ----------------
exercise of an Option or Stock Purchase Right unless the exercise of such Option
or Stock Purchase Right and the issuance and delivery of such Shares shall
comply with Applicable Laws and shall be further subject to the approval of
counsel for the Company with respect to such compliance.

          (b)    Investment Representations. As a condition to the exercise of
                 --------------------------
an Option or Stock Purchase Right, the Company may require the person exercising
such Option or Stock Purchase Right 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.

     17.  Inability to Obtain Authority.  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.

                                      -12-
<PAGE>

     18.  Reservation of Shares. The Company, during the term of this Plan, will
          ---------------------
at all times reserve and keep available such number of Shares as shall be
sufficient to satisfy the requirements of the Plan.

     19.  Shareholder Approval.  The Plan shall be subject to approval by the
          --------------------
shareholders of the Company within twelve (12) months after the date the Plan is
adopted.  Such shareholder approval shall be obtained in the manner and to the
degree required under Applicable Laws.

                                      -13-

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