<DOCUMENT>
<TYPE>EX-10.11
<SEQUENCE>2
<FILENAME>0002.txt
<DESCRIPTION>LONG-TERM EQUITY INCENTIVE PLAN
<TEXT>
 
<PAGE>
 
                                                                   Exhibit 10.11
 
 
                              ORACLE CORPORATION
 
                     2000 LONG-TERM EQUITY INCENTIVE PLAN
 
     Section 1.  Purpose.  This 2000 Long-Term Equity Incentive Plan ("Plan") is
established as a compensatory plan to enable Oracle Corporation (the "Company")
to provide an incentive to eligible employees, officers, independent
consultants, directors who are also employees or consultants, and advisers whose
present and potential contributions are important to the continued success of
the Company; to afford such persons an opportunity to acquire a proprietary
interest in the Company, and to enable the Company to continue to enlist and
retain in its employ the best available talent for the successful conduct of its
business. It is intended that this purpose will be effected through the granting
of (a) stock options, (b) stock purchase rights, (c) stock appreciation rights
and (d) long-term performance awards.
 
     Section 2.  Definitions. As used herein, the following definitions shall
apply:
 
    (a) "Affiliate" of any person means any entity that directly, or indirectly
through one or more intermediaries, controls or is controlled by, or is under
common control with, such person, where "control" (including the terms
"controlled by" and "under common control with") means the possession, direct or
indirect, of the power to cause the direction of the management and policies of
the entity, whether through the ownership of voting securities, by contract or
otherwise.
 
    (b) "Applicable Laws" means the legal requirements relating to the
administration of stock plans under U.S. state corporate laws, U.S. federal and
state securities laws, the Code, any stock exchange or consolidated stock price
reporting system on which prices for the Common Stock are quoted at any given
time, and the analogous applicable laws of any other country or jurisdiction
where Options, Rights or Long-Term Performance Awards or shares of Restricted
Stock are granted under the Plan.
 
    (c) "Board" means the Board of Directors of the Company.
 
    (d) "Change of Control" shall mean the first to occur of:
 
            (i) an individual, corporation, partnership, group, associate or
     other entity or "person", as such term is defined in Section 14(d) of the
     Securities Exchange Act of 1934 (the "Exchange Act"), other than the
     Company or any employee benefit plan(s) sponsored by the Company, is or
     becomes the "beneficial owner" (as defined in Rule 13d-3 under the Exchange
     Act), directly or indirectly, of 50% or more of the combined voting power
     of the Company's outstanding securities ordinarily having the right to vote
     at elections of directors;
 
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            (ii) individuals who constitute the Board of Directors of the
     Company on the effective date of the Plan (the "Incumbent Board") cease for
     any reason to constitute at least a majority thereof, provided that any
     Approved Director, as hereinafter defined, shall be, for purposes of this
     subsection (ii), considered as though such person were a member of the
     Incumbent Board.  An "Approved Director", for purposes of this subsection
     (ii), shall mean any person becoming a director subsequent to the effective
     date of the Plan whose election, or nomination for election by the
     Company's stockholders, was approved by a vote of at least three-quarters
     of the directors comprising the Incumbent Board (either by a specific vote
     or by approval of the proxy statement of the Company in which such person
     is named as a nominee of the Company for director), but shall not include
     any such individual whose initial assumption of office occurs as a result
     of either an actual or threatened election contest (as such terms are used
     in Rule 14a-11 of Regulation 14A promulgated under the Exchange Act) or
     other actual or threatened solicitation of proxies or consents by or on
     behalf of an individual, corporation, partnership, group, associate or
     other entity or "person" other than the Board;
 
            (iii)  the approval by the stockholders of the Company of a plan or
     agreement providing (A) for a merger or consolidation involving the Company
     other than with a wholly-owned subsidiary and other than a merger or
     consolidation that would result in the voting securities of the Company
     outstanding immediately prior thereto continuing to represent (either by
     remaining outstanding or by being converted into voting securities of the
     surviving entity) more than 65% of the combined voting power of the voting
     securities of the Company or such surviving entity outstanding immediately
     after such merger or consolidation, or (B) for a sale, exchange or other
     disposition of all or substantially all of the assets of the Company.  If
     any of the events enumerated in this subsection (iii) occurs, the Committee
     shall determine the effective date of the Change of Control resulting
     therefrom for purposes of the Plan.
 
    (e) "Code" means the U.S. Internal Revenue Code of 1986, as amended.
 
    (f) "Committee" means the Committee or Committees referred to in Section 5
of the Plan. If at any time no Committee shall be in office, then the functions
of the Committee specified in the Plan shall be exercised by the Board.
 
    (g) "Common Stock" or "Shares" means the Common Stock, $.01 par value per
share, of the Company.
 
    (h) "Company" means Oracle Corporation, a corporation organized under the
laws of the state of Delaware, or any successor corporation.
 
                                       2
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    (i) "Exchange Act" means the U.S. Securities Exchange Act of 1934, as
amended.
 
    (j) "Disability" means a disability, whether temporary or permanent,
partial or total, within the meaning of Section 22(e)(3) of the Code, as
determined by the Committee.
 
    (k) "Fair Market Value" means, as of any date, the value of Common Stock
determined as follows:
 
            (i) the last reported sale price of the Common Stock of the Company
     on the Nasdaq National Market or, if no such reported sale takes place on
     any such day, the average of the closing bid and asked prices, or
 
            (ii) if such Common Stock shall then be listed on a national
     securities exchange, the last reported sale price or, if no such reported
     sale takes place on any such day, the average of the closing bid and asked
     prices on the principal national securities exchange on which the Common
     Stock is listed or admitted to trading, or
 
            (iii)  if such Common Stock shall not be quoted on such National
     Market nor listed or admitted to trading on a national securities exchange,
     then the average of the closing bid and asked prices, as reported by The
     Wall Street Journal for the over-the-counter market, or
 
            (iv) if none of the foregoing is applicable, then the Fair Market
     Value of a share of Common Stock shall be determined in good faith by the
     Board of Directors of the Company in its discretion.
 
    (l) "Grant" shall mean an instrument or agreement evidencing an Option,
Stock Appreciation Right or Long-Term Performance Award granted hereunder, in
written or electronic form, which may, but need not, be executed or acknowledged
by the recipient thereof.
 
    (m) "Insider" means an executive officer or director of the Company or any
other person whose transactions in Common Stock are subject to Section 16(b) of
the Exchange Act.
 
    (n) "Long-Term Performance Award" means an award under Section 9 below.  A
Long-Term Performance Award shall permit the recipient to receive a stock bonus
(as determined by the Committee) upon satisfaction of such performance factors
as are set out in the recipient's individual grant. Long-term Performance Awards
will be based upon the achievement of Company, Subsidiary and/or individual
performance factors or upon such other criteria as the Committee may deem
appropriate.
 
                                       3
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    (o) "Named Executive" means any individual who, on the last day of the
Company's fiscal year, is the chief executive officer of the Company (or is
acting in such capacity) or among the four highest compensated officers of the
Company (other than the chief executive officer).  Such officer status shall be
determined pursuant to the executive compensation disclosure rules under the
Exchange Act.
 
    (p) "Option" means any option to purchase shares of Common Stock granted
pursuant to Section 6 below.
 
    (q) "Parent" means any corporation (other than the Company) in an unbroken
chain of corporations ending with the Company if, at the time of the granting of
an award under the Plan, each of such corporations other than the Company owns
stock possessing 50% or more of the total combined voting power of all classes
of stock in one of the other corporations in such chain.
 
    (r) "Participant" means an individual who has been granted an Option,
Right or Long-Term Purchase Award under the Plan.
 
    (s) "Plan" means this 2000 Long-Term Equity Incentive Plan, as hereinafter
amended from time to time.
 
    (t) "Purchase Agreement" shall have the meaning specified in Section 8.
 
    (u) "Restricted Stock" means shares of Common Stock acquired pursuant to a
grant of Stock Purchase Rights under Section 8 below.
 
    (v) "Right" means and includes Stock Appreciation Rights and Stock
Purchase Rights granted pursuant to the Plan.
 
    (w) "Stock Appreciation Right" or "SAR" means an award made pursuant to
Section 7 below, which right permits the recipient to receive cash equal to the
difference between the Fair Market Value of Common Stock on the date of grant of
the Stock Appreciation Right and the Fair Market Value of Common Stock on the
date of exercise of the Stock Appreciation Right.
 
    (x) "Stock Purchase Right" means an award made pursuant to Section 8
below, which right permits the recipient to purchase Common Stock pursuant to a
restricted stock purchase agreement entered into between the Company and the
Participant.
 
    (y) "Subsidiary" means any corporation (other than the Company) in an
unbroken chain of corporations beginning with the Company if, at the time of
granting of the Option, each of the corporations other than the last corporation
in the unbroken chain owns stock possessing 50% or more of the total combined
voting power of all classes of stock in one of the other corporations in such
chain.
 
                                       4
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    (z) "Substitute Awards" shall mean an Option, Right or Long-Term
Performance Award granted in assumption of or in substitution for, outstanding
options or other awards previously granted by a company acquired by the Company
or with which the Company combines.
 
     Section 3.  Eligibility.
 
    (a) Awards may be granted to employees, officers, directors who are also
employees or consultants, independent consultants and advisers of the Company or
any Parent, Subsidiary or Affiliate of the Company (provided such consultants,
and advisers render bona fide services not in connection with the offer and sale
of securities in a capital-raising transaction). ISOs (hereinafter defined in
Section 6 hereof) may be granted only to employees (including officers and
directors who are also employees) of the Company or of a Parent or Subsidiary of
the Company.
 
    (b) A Participant may be granted more than one award under this Plan.
 
    (c) Holders of options and other awards granted by a company acquired by
the Company or with which the Company combines are eligible for grant of
Substitute Awards hereunder in connection with such acquisition or combination
transaction.
 
     Section 4.   Stock Subject to the Plan.
 
    (a) The total number of shares of Common Stock reserved and available for
distribution pursuant to the Plan shall be [269,953,132] shares, of which no
more than 10% of such Shares may be distributed pursuant to the grant of Stock
Purchase Rights./1/
 
    (b) If any Shares that have been subject to issuance upon exercise of an
Option (other than a Substitute Award) cease to be subject to such Option, or if
any Shares of Restricted Stock or other Shares that are subject to any Right,
Option or Long-Term Performance Award granted hereunder (other than a Substitute
Award) are forfeited or repurchased or any such award otherwise terminates or is
paid or settled without a payment being made to the Participant in the form of
the full number of Shares underlying such awards, such Shares to the extent of
such forfeiture, termination or settlement, shall again be available for
distribution in connection with future awards or Option grants under the Plan.
For purposes of this Section 4(b), awards and options granted under any of the
Company's previous stock option plans (other than any such plans for outside
directors) shall be treated
 
__________
  /1/ The number of authorized shares under this Plan will equal that number of
authorized shares available for grant under the Company's 1991 Long-Term Equity
Incentive Plan (the "1991 Plan") as of the date this Plan becomes effective.
The number of authorized shares available for grant under the 1991 Plan as of
the date hereof is 269,953,132.
 
                                       5
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as Options, Rights or Long-Term Performance Awards, as the case may be, acquired
hereunder.
 
    (c) Shares underlying Substitute Awards shall not reduce the number of
Shares available for distribution hereunder.
 
    (d) In the event that any Option, Right or Long-Term Performance Award
granted hereunder (other than a Substitute Award) is exercised through the
surrender to the Company of Shares or in the event that withholding tax
liabilities arising in connection with any such award are satisfied by the
withholding of Shares by the Company, the number of Shares available for
distribution under the Plan as set forth in Section 4(a) shall be increased by
the number of Shares so surrendered or withheld.
 
    (e) Options and SARs on no more than 25,000,000 shares of Common Stock may
be granted to any individual in any year under this Plan.
 
    (f) (i) In the event that the Common Stock of the Company is split or
reverse-split, whether by stock dividend, combination, reclassification or
similar method not involving payment of consideration, the number of Shares
available for award under this Plan, in aggregate and individually as set forth
in Sections 4(a) and 4(e), the number of Shares deliverable under each Option,
Right or Long-Term Performance Award outstanding hereunder and the per Share
exercise price of each outstanding Option or Right shall automatically be
proportionately adjusted, subject to any required action by the Board or the
stockholders of the Company and compliance with Applicable Laws; provided,
however, that the number of Shares subject to any award denominated in Shares
shall always be a whole number.
 
            (ii) In the event that the Committee shall determine that any
     dividend or other distribution (whether in the form of cash, Common Stock,
     other securities, or other property), recapitalization, stock split,
     reverse stock split, reorganization, merger, consolidation, split-up, spin-
     off, combination, repurchase or exchange of Common Stock or other
     securities of the Company, issuance of warrants or other rights to purchase
     Common Stock or other securities of the Company, or other similar corporate
     transaction or event other than an event described in Section 4(f)(i)
     affects the Common Stock such that an adjustment is determined by the
     Committee to be appropriate in order to prevent dilution or enlargement of
     the benefits or potential benefits intended to be made available under the
     Plan, then the Committee shall, in such manner as it may deem equitable,
     adjust any or all of (i) the number and type of Shares (or other securities
     or property) which thereafter may be made the subject of awards under the
     Plan, including the aggregate and individual limits specified in Section 4,
     (ii) the number and type of Shares (or other securities or property)
     subject to outstanding awards, and (iii) the grant, purchase, or exercise
     price with respect to any award or, if deemed appropriate, make provision
     for a cash payment to the
 
                                       6
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     holder of an outstanding award; provided, however, that the number of
     Shares subject to any award denominated in Shares shall always be a whole
     number.
 
     Section 5.  Administration.
 
    (a) The Plan shall be administered by one or more Committees designated by
the Board to administer the Plan, constituted in such a manner as to satisfy the
Applicable Laws.
 
    (b) Once appointed, the Committee shall continue to serve until otherwise
directed by the Board. From time to time, the Board may change the size of the
Committee, appoint additional members thereof, remove members (with or without
cause), appoint new members in substitution therefor, fill vacancies, however
caused, and remove all members of the Committee and thereafter directly
administer the Plan, all to the extent permitted by Applicable Laws.
 
    (c) As used herein, except in Sections 17 and 19, references herein to the
Board shall mean the Board or the Committee, whichever is then acting with
respect to the Plan.
 
    (d) The Committee shall have the authority to construe and interpret the
Plan, to prescribe, amend and rescind rules and regulations relating to the
Plan, and to make all other determinations necessary or advisable for the
administration of the Plan, and any such interpretation shall be final and
binding on all persons having an interest in any award under this Plan.  Without
limiting the generality of the foregoing, subject to the general purposes,
terms, and conditions of the Plan, and to the direction of the Board, the
Committee shall have full power to implement and carry out the Plan including,
but not limited to, the following:
 
            (i) to select the employees, officers, consultants, directors and
     advisers of the Company and/or its Subsidiaries and Affiliates to whom
     Options, Rights and Long-Term Performance Awards, or any combination
     thereof, may from time to time be granted hereunder;
 
            (ii) to determine whether and to what extent Options, Rights and
     Long-Term Performance Awards, or any combination thereof, are granted
     hereunder;
 
            (iii)  to determine the number of Shares to be covered by each such
     award granted hereunder;
 
            (iv) to approve forms of grant or agreement, or other forms for
     communicating to Participants that they have been granted an award under
     the Plan, for use under the Plan;
 
                                       7
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            (v) to determine the terms and conditions, not inconsistent with the
     terms of the Plan, of any award granted hereunder (including, but not
     limited to, the share price and any restriction or limitation, or any
     vesting acceleration or waiver of forfeiture restrictions regarding the
     Option or other award and/or the Shares relating thereto, based in each
     case on such factors as the Committee shall determine, in its sole
     discretion);
 
            (vi) to determine whether and under what circumstances an Option may
     be settled in cash or Restricted Stock under Section 6(g) instead of Common
     Stock;
 
            (vii)  to determine the form of payment that will be acceptable
     consideration for exercise of an Option, Right or Long-Term Performance
     Award granted under the Plan;
 
            (viii)  to determine whether, or to what extent and under what
     circumstances Common Stock and other amounts payable with respect to an
     award under this Plan shall be deferred either automatically or at the
     election of the Participant (including providing for and determining the
     amount (if any) of any deemed earnings on any deferred amount during any
     deferral period);
 
            (ix) to delegate to another committee of the Board or to members of
     management certain of its powers hereunder to the extent permitted by
     Applicable Laws;
 
            (x) to reduce the exercise price of any Option or Right;
 
            (xi) to determine the terms and restrictions applicable to Stock
     Purchase Rights and the Restricted Stock purchased by exercising such
     Rights; and
 
            (xi) to adopt sub-plans applicable to particular Subsidiaries,
     Affiliates or locations, which sub-plans may take precedence over other
     provisions of this Plan, with the exception of Section 4(a), but unless
     otherwise superseded by the terms of such sub-plan, the provisions of this
     Plan shall govern the operation of such sub-plan.
 
    (e) In addition to such other rights of indemnification as they may have
as directors, members of the Committee shall be indemnified by the Company
against any reasonable expenses, including attorneys' fees actually and
necessarily incurred, which they or any of them may incur by reason of any
action taken or failure to act under or in connection with the Plan or any
option or other award granted thereunder, and against all amounts paid by them
in settlement of any claim related thereto, (provided such settlement is
approved by independent legal counsel selected by the Company) or paid by them
in satisfaction of a judgment in any such
 
                                       8
<PAGE>
 
action, suit or proceeding that such director is liable for negligence or
misconduct in the performance of his or her duties; provided that within 60 days
after institution of any such action, suit or proceeding a director shall in
writing offer the Company the opportunity, at its own expense, to handle the
defense of the same.
 
     Section 6.  Stock Options. The Committee, in its discretion, may grant
Options to eligible Participants and shall determine whether such Options shall
be Incentive Stock Options ("ISOs") within the meaning of the Code, Nonqualified
Stock Options ("NQSOs") or any other type of Option which may exist from time to
time. Each Option shall be evidenced by a Grant which shall expressly identify
the Option as an ISO or as NQSO (or other type of Option, as applicable), and be
in such form and contain such provisions as the Committee shall from time to
time deem appropriate. Without limiting the foregoing, the Committee may, at any
time, or from time to time, authorize the Company, with the consent of the
respective recipients, to issue new Options, including Options in exchange for
the surrender and cancellation of any or all outstanding Options or Rights.
 
     The Committee shall determine the number of Shares subject to the Option,
the exercise price of the Option, the period during which the Option may be
exercised, and all other terms and conditions of the Option, subject to the
following:
 
    (a) Form of Option Grant. Each Option granted under this Plan shall be
evidenced by a Grant in such form (which need not be the same for each
Participant) as the Committee shall from time to time approve, which Grant shall
comply with and be subject to the terms and conditions of this Plan.
 
    (b) Date of Grant. The date of grant of an Option shall be the date on
which the Committee makes the determination to grant such Option unless
otherwise specified by the Committee. The Grant representing the Option will be
delivered to Participant with a copy of this Plan within a reasonable time after
the granting of the Option.
 
    (c) Exercise Price. The exercise price of an Option shall be determined by
the Committee on the date the Option is granted and may be less than the Fair
Market Value of the Common Stock on the date the Option is granted.
 
    (d) Exercise Period. Options shall be exercisable within the times or upon
the events determined by the Committee as set forth in the Grant; provided,
however; that no Option shall be exercisable after the expiration of ten (10)
years from the date the Option is granted.  The Committee may attach such
conditions to the Shares issued upon exercise of an Option as it shall
determine, and may provide in any grant for Option exercise restrictions to be
waived in consideration of equivalent transfer or forfeiture provisions to be
applied to such underlying Shares.
 
                                       9
<PAGE>
 
      (e) Limitations on ISOs. The terms of any ISO granted under the Plan shall
comply in all respects with the provisions of Section 422 of the Code, or any
successor provision thereto, and any regulations promulgated thereunder.
 
      (f) Limitations on Transfer. Options granted under this Plan, and any
interest therein, shall not be transferable or assignable by the Participant,
and may not be made subject to execution, attachment or similar process,
otherwise than by will or by the laws of descent and distribution, and shall be
exercisable during the lifetime of the Participant only by the Participant;
provided, however; that NQSOs held by a Participant may be transferred to such
family members, trusts and charitable institutions as the Committee, in its sole
discretion, shall approve, unless otherwise restricted from such transfer under
the terms of the Grant.
 
      (g) Buyout Provisions. The Committee may at any time offer to buy out for
a payment in cash or Common Stock (including Restricted Stock), an Option
previously granted, based on such terms and conditions as the Committee shall
establish and communicate to the Participant at the time that such offer is
made.
 
      (h)  Notice. Options may be exercised only by delivery to the Company or
its representative of a stock option exercise instrument in a form approved by
the Committee from time to time (which may be in written, electronic or other
form selected by the Committee from time to time and need not be the same for
each Participant), stating the number of Shares being purchased, the
restrictions imposed on the Shares, if any, and such representations and
agreements regarding Participant's investment intent and access to information,
if any, as may be required by the Company to comply with the Applicable Laws,
together with payment in full of the exercise price for the number of Shares
being purchased or adequate provision therefor, in accordance with Section 6(i).
 
      (i)  Payment. Payment for Shares purchased upon exercise of an Option may
be made in cash (by check) or, unless otherwise provided by the Committee in its
sole discretion: (i) by cancellation of indebtedness of the Company to the
Participant; (ii) by surrender of Shares of Common Stock having a Fair Market
Value equal to the applicable exercise price of the Options; (iii) where
approved by the Committee in its sole discretion, by tender of a full recourse
promissory note having such terms as may be approved by the Committee and
bearing interest at a rate sufficient to avoid imputation of income under
Sections 483 and 1274 of the Code, provided that the portion of the exercise
price equal to the par value of the Shares, if any, must be paid in cash or
other legal consideration, and provided further that Participants who are not
employees or directors of the Company shall not be entitled to purchase Shares
with a promissory note unless the note is adequately secured by collateral other
than the Shares; (iv) by waiver of compensation due or accrued to the
Participant for services rendered; (v) pursuant to a broker-assisted "cashless
exercise" arrangement; or (vi) by any combination of the foregoing, in each such
case to the extent permitted by Applicable Law.
 
                                       10
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      (j) Limitations on Exercise. In addition to exercise restrictions or other
vesting provisions set forth in any Grant, unless the Committee shall otherwise
determine, and except in the case of a Substitute Award, the exercisability of
an Option following termination of the Participant's employment shall be subject
to this Section 6(j).
 
            (i) If the Participant ceases to be employed by the Company or any
     Parent, Subsidiary or Affiliate of the Company for any reason except death
     or disability, such Participant's Options may be exercised to the extent
     (and only to the extent) that they would have been exercisable upon the
     date of termination of the Participant's employment, within three (3)
     months after the date of termination (or such shorter time period as may be
     specified in the Grant), but in any event no later than the expiration date
     of the Option.
 
            (ii) If the Participant's employment with the Company or any Parent,
     Subsidiary or Affiliate of the Company is terminated because of the
     Disability of the Participant, or if the Participant dies within three (3)
     months of his termination of employment, the Participant's Options may be
     exercised to the extent (and only to the extent) that they would have been
     exercisable on the date of termination of the Participant's employment, by
     the Participant (or the Participant's legal representative) within twelve
     (12) months after the date of termination of employment (or such shorter
     time period as may be specified in the Grant), but in any event no later
     than the expiration date of the Options.
 
            (iii)  If the Participant's employment with the Company or any
     Parent, Subsidiary or Affiliate of the Company is terminated because of the
     death of the Participant, the Participant's Options may be exercised to the
     extent (and only to the extent) that they would have been exercisable on
     the first vesting date occurring after such death as may be specified in
     the Grant and on the next subsequent vesting date, by the Participant's
     legal representative within twelve (12) months after the date of death (or
     such shorter period as may be specified in the Grant), but in any event no
     later than the expiration date of the Options.
 
            (iv) A Participant's employment relationship shall be considered to
     have terminated, and the Participant to have ceased to be employed by his
     or her employer, on the earliest of:
 
                   (A) the date on which the Company, or any Parent, Subsidiary
          or Affiliate of the Company, as appropriate, delivers to the
          Participant notice in a form prescribed by the Company that the
          Company, or such other entity, is thereby terminating the employment
          relationship (regardless of whether the notice or termination is
          lawful or unlawful or is in breach of any contract of employment),
 
                                       11
<PAGE>
 
                   (B) the date on which the Participant delivers notice in a
          form prescribed by the Company, to the Company, or any Parent,
          Subsidiary or Affiliate of the Company, as appropriate, that he or she
          is terminating the employment relationship (regardless of whether the
          notice or termination is lawful or unlawful or is in breach of any
          contract of employment),
 
                   (C) the date on which the Participant ceases to provide
          services to the Company, or any Parent, Subsidiary or Affiliate of the
          Company, as appropriate, except where the Participant is on an
          authorized leave of absence, or
 
                   (D) the date on which the Participant ceases to be considered
          an "employee" under Applicable Law.
 
     The Committee shall have discretion to determine whether a Participant has
ceased to be employed by the Company or any Parent, Subsidiary or Affiliate of
the Company, as appropriate, and the effective date on which such employment
terminated or whether such Participant is on an authorized leave of absence.
 
            (v) In the case of a Participant who is a director, consultant, or
     adviser, the Committee will have the discretion to determine whether the
     Participant is "employed by the Company or any Parent, Subsidiary or
     Affiliate of the Company" pursuant to the foregoing Sections.
 
            (vi) The Committee may specify a reasonable minimum number of Shares
     that may be purchased on any exercise of an Option, provided that such
     minimum number will not prevent the Participant from exercising the full
     number of Shares as to which the Option is then exercisable.
 
      (k) Modification, Extension and Renewal of Options. The Committee shall
have the power to modify, extend or renew outstanding Options and to authorize
the grant of new Options in substitution therefore, provided that any such
action may not, without the written consent of the holder, impair any rights
under any Option previously granted.
 
     Section 7.  Stock Appreciation Rights.  The Committee, in its discretion,
may grant Stock Appreciation Rights to eligible Participants. The following
provisions apply to such Stock Appreciation Rights.
 
      (a) Grant of Stock Appreciation Right. The Stock Appreciation Right shall
entitle the holder upon exercise to an amount for each Share to which such
exercise relates equal to the excess of (x) the Full Market Value on the date of
exercise of a Share over (y) the base or exercise price of the Common Stock as
set forth in the applicable Grant. Notwithstanding the foregoing, the Committee
may place limits on the amount that may be paid upon exercise of a Stock
Appreciation Right.
 
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      (b) Forfeiture of Option. If a Stock Appreciation Right is granted in
tandem with an Option, upon exercise of such Stock Appreciation Right, the
related Option shall no longer be exercisable and shall be deemed canceled to
the extent of such exercise.
 
      (c) Form of Payment. The Company's obligation arising upon the exercise of
a Stock Appreciation Right may be paid currently or on a deferred basis with
such interest or earnings equivalent as may be determined by the Committee, and
may be paid in Common Stock or in cash, or in any combination of Common Stock
and cash, as the Committee, in its sole discretion, may determine.
 
      (d) Other Provisions.  The Grant evidencing a Stock Appreciation Rights
shall contain such other terms, provisions and conditions not inconsistent with
the Plan as may be determined by the Committee in its sole discretion.  The
provisions of such Grants need not be the same with respect to each recipient.
 
     Section 8.  Stock Purchase Rights.
 
      (a)  Rights to Purchase. Stock Purchase Rights to purchase Restricted
Stock may be issued either alone, in addition to, or in tandem with other awards
granted under the Plan. After the Committee determines that it will offer Stock
Purchase Rights under the Plan, it shall advise the offeree in writing of the
terms, conditions and restrictions related to the offer, including the number of
Shares that such person shall be entitled to purchase, the price to be paid, and
the time within which such person must accept such offer, which shall in no
event exceed 60 days from the date the Stock Purchase Right was granted. The
offer shall be accepted by execution of a Restricted Stock Purchase Agreement
(the "Purchase Agreement") in the form determined by the Committee.
 
      (b) Repurchase Option. Unless the Committee determines otherwise, the
Purchase Agreement shall grant the Company a repurchase option exercisable upon
the voluntary or involuntary termination of the purchaser's employment with the
Company for any reason (including death or Disability). The purchase price for
Shares repurchased pursuant to the 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 such rate
as the Committee may determine.
 
      (c)  Other Provisions. The Purchase Agreement shall contain such other
terms, provisions and conditions not inconsistent with the Plan as may be
determined by the Committee in its sole discretion. The provisions of Purchase
Agreements need not be the same with respect to each purchaser.
 
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     Section 9.  Long-Term Performance Awards.
 
      (a)  Administration. Long-Term Performance Awards are stock bonus awards
that may be granted either alone or in addition to other awards granted under
the Plan. The Committee shall determine the nature, length and starting date of
any performance period (the "Performance Period") for each Long-Term Performance
Award, and shall determine the performance factors to be used in the
determination of a Long-Term Performance Award and the extent to which such
Long-Term Performance Awards have been earned. Long-Term Performance Awards may
vary from Participant to Participant and between groups of Participants and
shall be based upon the achievement of Company, Parent, Subsidiary or Affiliate,
or upon such individual performance factors or upon such other criteria as the
Committee may deem appropriate.  Performance Periods may overlap and
Participants may participate simultaneously with respect to Long-Term
Performance Awards that are subject to different Performance Periods and
different performance factors and criteria. Long-Term Performance Awards shall
be confirmed by, and be subject to the terms of, a Long-Term Performance Award
agreement. The terms of such awards need not be the same with respect to each
Participant.
 
     At the beginning of each Performance Period, the Committee shall determine
for each Long-Term Performance Award subject to such Performance Period, the
number of Shares  to be awarded to the Participant at the end of the Performance
Period if and to the extent that the relevant measures of performance for such
Long-Term Performance Award are met. Such number of shares of Common Stock may
be fixed or may vary in accordance with such performance or other criteria as
maybe determined by the Committee.
 
      (b) Adjustment of Awards. The Committee may adjust the performance factors
applicable to the Long-Term Performance Awards to take into account changes in
law, accounting and tax rules and to make such adjustments as the Committee
deems necessary or appropriate to reflect the inclusion or exclusion of the
impact of extraordinary or unusual items, events or circumstances in order to
avoid windfalls or hardships.
 
      (c)  Termination. Unless otherwise provided in the applicable Long-Term
Performance Award agreement, if a Participant terminates his or her employment
or his or her consultancy during a Performance Period because of death or
Disability, the Committee may provide for an earlier payment in settlement of
such award in such amount and under such terms and conditions as the Committee
deems appropriate.
 
     Except as otherwise provided in the applicable Long-Term Performance Award
agreement, if a Participant terminates employment or his or her consultancy
during a Performance Period for any other reason, then such Participant shall
not be entitled to any payment with respect to the Long-Term
 
                                       14
<PAGE>
 
Performance Award subject to such Performance Period, unless the Committee
shall otherwise determine.
 
      (d)  Form of Payment. The earned portion of a Long-Term Performance Award
may be paid currently or on a deferred basis with such interest or earnings
equivalent as may be determined by the Committee. Payment shall be made in the
form of cash, whole Shares, including Restricted Stock, or a combination
thereof, either in a lump sum payment or in installments, all as the Committee
shall determine.
 
     Section 10.  Withholding Taxes.
 
      (a)  Withholding Generally. The Company shall have the right to withhold
or require the recipient to remit to the Company an amount sufficient to satisfy
federal, state, or local withholding tax requirements arising in connection with
the grant, exercise or settlement of any award under the Plan prior to the
delivery of any certificate or certificates for Shares or other amounts
hereunder.
 
      (b) Stock Withholding.  When a Participant incurs tax liability in
connection with the exercise or vesting of any Option, Right or Long-Term
Performance Award, which tax liability is subject to tax withholding under
applicable tax laws, and the Participant is obligated to pay the Company an
amount required to be withheld under applicable tax laws, the Participant may
satisfy the withholding tax obligation by electing to have the Company withhold
from the Shares otherwise to be delivered that number of Shares having a Fair
Market Value equal to the amount required to be withheld, determined on the date
that the amount of tax to be withheld is to be determined; provided however that
the Company shall not allow withholding of Shares (i) upon exercise or vesting
of any Option, Right or Long-Term Performance Award in an amount which exceeds
the minimum statutory withholding rates for federal, state and local tax
purposes, including payroll taxes or (ii) if such withholding is not permitted
under local laws. All elections by a Participant to have Shares withheld for
this purpose shall be made in accordance with procedures established by the
Committee from time to time.
 
     Section 11.  Change of Control.  Unless specifically provided to the
contrary in any Grant or Purchase Agreement, upon a Change of Control, (a)
unless outstanding Options and Rights are effectively assumed by the surviving
or acquiring corporation or otherwise remain outstanding, such Options and
Rights shall become fully vested and exercisable, and any repurchase or resale
restrictions applicable to any award granted hereunder shall automatically lapse
and such Options or Rights shall expire on the consummation of such Change of
Control transaction at such times and on such conditions as the Committee shall
determine and (b) if an Option or Right is effectively so assumed or remains
outstanding, and the Participant's employment is terminated (within the meaning
of Section 6 hereof) by the surviving or acquiring corporation without cause
within twelve (12) months after the consummation of such Change of Control
 
                                       15
<PAGE>
 
transaction, such Option or Right shall accelerate and become immediately and
fully exercisable, and any repurchase or resale restrictions applicable to any
such award shall automatically lapse, upon such termination.
 
     Section 12.  Employment Relationship. Nothing in the Plan or any award made
hereunder shall interfere with or limit in any way the right of the Company or
of any Parent, Subsidiary or Affiliate to terminate any Participant's employment
or consulting relationship at any time, with or without cause, nor confer upon
any Participant any right to continue in the employ or service of the Company or
any Parent, Subsidiary or Affiliate.
 
     Section 13.  General Restriction. Each award shall be subject to the
requirement that, if, at any time, the Committee shall determine, in its
discretion, that the listing, registration, or qualification of the Shares
subject to such award upon any securities exchange or under any state or federal
law, or the consent or approval of any government regulatory body, is necessary
or desirable as a condition of, or in connection with, such award or the issue
or purchase of Shares thereunder, such award may not be exercised or paid in
whole or in part unless such listing, registration, qualification, consent, or
approval shall have been effected or obtained free of any conditions not
acceptable to the Committee.  The Committee shall be under no obligation to
obtain or seek such listing, registration, qualification, consent or approval.
 
     Section 14.  Rights as a Stockholder. The holder of an Option, Right or
Long-Term Performance Award shall have no rights as a stockholder with respect
to any Shares covered by the Option, Right or Long-Term Performance Award until
the Shares subject to such award have been entered upon the records of the duly
authorized transfer agent of the Company. Except as otherwise expressly provided
in the Plan, no adjustment shall be made for dividends or other rights for which
the record date is prior to the date such stock certificate so entered.
 
     Section 15.  Limitations on Assignment of Awards. Except as otherwise
provided in Section 6(f) hereof, no awards made hereunder shall be assignable or
transferable by the Participant except by will or by the laws of descent and
distribution and as otherwise consistent with the specific Plan provisions
relating thereto or as the Committee in its sole discretion shall approve.
During the life of the Participant, an Option, Right or Long-Term Performance
Award shall be exercisable only by him or her, or by a transferee as permitted
by Section 6(f) hereof and any award agreement.
 
     Section 16.  Nonexclusivity of the Plan. Neither the adoption of the Plan
by the Board, the submission of the Plan to the stockholders of the Company for
approval, nor any provisions of the Plan shall be construed as creating any
limitations on the power of the Board to adopt such additional compensation
arrangements as it may deem desirable, including without limitation,
arrangements providing for the granting of Options otherwise than under the
Plan,
 
                                       16
<PAGE>
 
and such arrangements may be either generally applicable or applicable only in
specific cases.
 
     Section 17.  Adoption and Stockholder Approval. This Plan shall become
effective on the date that it is adopted by the Board of the Company and
approved by the stockholders of the Company, in any manner permitted by
applicable corporate law.
 
     Section 18.  Term of Plan. Awards may be granted pursuant to this Plan from
time to time prior to the expiration hereof, which shall occur on the date of
the Company's Annual Meeting of Stockholders in 2010.
 
     Section 19.  Amendment or Termination of Plan.
 
      (a) Except to the extent prohibited by applicable law and unless otherwise
expressly provided in a Grant or Purchase Agreement or in the Plan, the Board
may amend, alter, suspend, discontinue, or terminate the Plan or any portion
thereof at any time, provided, however, that no such amendment, alteration,
suspension, discontinuation or termination shall be made without (i) stockholder
approval if such approval is necessary to comply with any tax or regulatory
requirement for which or with which the Board deems it necessary or desirable to
qualify or comply, or (ii) the consent of the affected Participant, if such
action would adversely affect the rights of such Participant under any
outstanding award.  Notwithstanding anything to the contrary herein, the
Committee or its delegee may amend the Plan and/or adopt subordinate
arrangements, policies and programs in each case subject to the authority set
forth in Section 5 hereof, in such manner as may be necessary to enable the Plan
to achieve its stated purposes in any jurisdiction outside the United States in
a tax-efficient manner and in compliance with local rules and regulations by
adopting schedules of provisions to be applicable to awards granted in such
jurisdiction.
 
      (b) The Committee may waive any conditions or rights under, amend any term
of, or amend, alter, suspend, discontinue or terminate, any award theretofore
granted, prospectively or retroactively, without the consent of any relevant
Participant or holder or beneficiary of an award, provided, however, that no
such action shall impair the rights of any affected Participant or holder or
beneficiary under any award theretofore granted under the Plan.
 
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