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                                                                 EXHIBIT 10.3





                            ADVANCED BIOTHERAPY, INC.



                       2000 OMNIBUS EQUITY INCENTIVE PLAN





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                                TABLE OF CONTENTS
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<S>      <C>
ARTICLE 1.  INTRODUCTION.......................................................................................

ARTICLE 2.  DEFINITIONS........................................................................................

ARTICLE 3.  SHARES AVAILABLE FOR GRANTS........................................................................
         3.1      BASIC LIMITATION.............................................................................
         3.2      ANNUAL INCREASE IN SHARES....................................................................
         3.3      ADDITIONAL SHARES............................................................................
         3.4      DIVIDEND EQUIVALENTS.........................................................................

ARTICLE 4.  ELIGIBILITY........................................................................................
         4.1      INCENTIVE STOCK OPTIONS......................................................................
         4.2      OTHER GRANTS.................................................................................
         4.3      NONASSIGNABILITY.............................................................................
         4.4      REQUIREMENT OF NOTIFICATION OF ELECTION UNDER SECTION 83(b) OF THE CODE......................
         4.5      REQUIREMENT OF NOTIFICATION UPON DISQUALIFYING DISPOSITION UNDER SECTION 421(b) OF THE CODE..

ARTICLE 5.  OPTIONS............................................................................................
         5.1      STOCK OPTION AGREEMENT.......................................................................
         5.2      NUMBER OF SHARES.............................................................................
         5.3      EXERCISE PRICE...............................................................................
         5.4      EXERCISABILITY AND TERM......................................................................
         5.5      MANNER OF EXERCISE...........................................................................
         5.6      EFFECT ON OPTION OF DEATH OR OTHER TERMINATION OF EMPLOYMENT, DIRECTORSHIP OR CONSULTANCY....
         5.7      EFFECT OF CHANGE IN CONTROL..................................................................
         5.8      MODIFICATION OR ASSUMPTION OF OPTIONS........................................................
         5.9      BUYOUT PROVISIONS............................................................................
         5.10     COMPANY'S RIGHT OF FIRST REFUSAL.............................................................
         5.11     COMPANY'S RIGHT OF RECAPTURE. ...............................................................

ARTICLE 6.  PAYMENT FOR OPTION SHARES..........................................................................
         6.1      GENERAL RULE.................................................................................
         6.2      SURRENDER OF STOCK...........................................................................
         6.3      NET EXERCISE.................................................................................
         6.4      EXERCISE/SALE................................................................................
         6.5      EXERCISE/PLEDGE..............................................................................
         6.6      PROMISSORY NOTE..............................................................................
         6.7      OTHER FORMS OF PAYMENT.......................................................................


                                         ii

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ARTICLE 7.  OPTION GRANTS TO OUTSIDE DIRECTORS/AFFILIATES.....................................................

ARTICLE 8.  STOCK APPRECIATION RIGHTS.........................................................................
         8.1      SAR AGREEMENT...............................................................................
         8.2      NUMBER OF SHARES............................................................................
         8.3      EXERCISE PRICE..............................................................................
         8.4      EXERCISABILITY AND TERM.....................................................................
         8.5      EFFECT OF CHANGE IN CONTROL.................................................................
         8.6      EXERCISE OF SARS............................................................................
         8.7      MODIFICATION OR ASSUMPTION OF SARS..........................................................

ARTICLE 9.  RESTRICTED SHARES.................................................................................
         9.1      RESTRICTED STOCK AGREEMENT..................................................................
         9.2      PAYMENT FOR AWARDS..........................................................................
         9.3      VESTING CONDITIONS..........................................................................
         9.4      VOTING AND DIVIDEND RIGHTS..................................................................
         9.5      REPURCHASE OPTION...........................................................................

ARTICLE 10.  STOCK UNITS......................................................................................
         10.1     STOCK UNIT AGREEMENT........................................................................
         10.2     PAYMENT FOR AWARDS..........................................................................
         10.3     VESTING CONDITIONS..........................................................................
         10.4     VOTING AND DIVIDEND RIGHTS..................................................................
         10.5     FORM AND TIME OF SETTLEMENT OF STOCK UNITS..................................................
         10.6     DEATH OF RECIPIENT..........................................................................
         10.7     CREDITORS' RIGHTS...........................................................................

ARTICLE 11.  PROTECTION AGAINST DILUTION......................................................................
         11.1     ADJUSTMENTS.................................................................................
         11.2     DISSOLUTION OR LIQUIDATION..................................................................
         11.3     REORGANIZATIONS.............................................................................

ARTICLE 12.  DEFERRAL OF AWARDS...............................................................................

ARTICLE 13.  AWARDS UNDER OTHER PLANS.........................................................................

ARTICLE 14.  PAYMENT OF DIRECTOR'S FEES IN SECURITIES.........................................................
         14.1     EFFECTIVE DATE..............................................................................
         14.2     ELECTIONS TO RECEIVE NSOs, RESTRICTED SHARES OR STOCK UNITS.................................
         14.3     NUMBER AND TERMS OF NSOs, RESTRICTED SHARES OR STOCK UNITS..................................

ARTICLE 15.  LIMITATION ON RIGHTS.............................................................................
         15.1     RETENTION RIGHTS............................................................................
         15.2     STOCKHOLDERS' RIGHTS........................................................................
         15.3     CONDITIONS UPON ISSUANCE OF COMMON SHARES...................................................

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ARTICLE 16.  WITHHOLDING TAXES................................................................................
         16.1     GENERAL.....................................................................................
         16.2     SHARE WITHHOLDING...........................................................................

ARTICLE 17.  FUTURE OF THE PLAN...............................................................................
         17.1     TERM OF THE PLAN............................................................................
         17.2     AMENDMENT OR TERMINATION....................................................................
         17.3     STOCKHOLDER APPROVAL........................................................................
         17.4     EFFECT OF AMENDMENT OR TERMINATION..........................................................

ARTICLE 18.  LIMITATION ON PARACHUTE PAYMENTS.................................................................
         18.1     SCOPE OF LIMITATION.........................................................................
         18.2     BASIC RULE..................................................................................
         18.3     REDUCTION OF PAYMENTS.......................................................................
         18.4     OVERPAYMENTS AND UNDERPAYMENTS..............................................................
         18.5     RELATED CORPORATIONS........................................................................

ARTICLE 19.  INDEMNIFICATION..................................................................................

ARTICLE 20.  PROVISION OF INFORMATION.........................................................................

ARTICLE 21.  ADMINISTRATION...................................................................................
         21.1     COMMITTEE COMPOSITION.......................................................................
         21.2     POWERS OF THE BOARD.........................................................................
         21.3     COMMITTEE FOR NON-OFFICER GRANTS............................................................

ARTICLE 22.  EXECUTION........................................................................................

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                                        iv
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                            ADVANCED BIOTHERAPY, INC.

                       2000 OMNIBUS EQUITY INCENTIVE PLAN

ARTICLE 1.  INTRODUCTION.

         The purpose of the Plan is to promote the long-term success of the
Company and the creation of stockholder value by (a) encouraging Employees,
Outside Directors and Consultants to focus on critical long-range objectives,
(b) encouraging the attraction and retention of Employees, Outside Directors and
Consultants with exceptional qualifications and (c) linking Employees, Outside
Directors and Consultants directly to stockholder interests through increased
stock ownership. The Plan seeks to achieve this purpose by providing for Awards
in the form of Restricted Shares, Stock Units, Options (which may constitute
incentive stock options or nonstatutory stock options) and Stock Appreciation
Rights. Terms defined herein shall have the meanings set forth in "Article 2 -
Definitions."

         The Plan shall be governed by, and construed in accordance with, the
laws of the State of California.

ARTICLE 2.  DEFINITIONS.

         2.1 "AFFILIATE" means any entity other than a Subsidiary, if the
Company and/or one or more Subsidiaries own not less than fifty percent (50%) of
such entity.

         2.2 "AWARD" means any award of an Option, an SAR, a Restricted Share or
a Stock Unit under the Plan.

         2.3 "BOARD" means the Company's Board of Directors, as constituted from
time to time.

         2.4 "CHANGE IN CONTROL" shall mean:

                  a. The consummation of a merger or consolidation of the
Company with or into another entity or any other corporate reorganization, if
more than fifty percent (50%) of the combined voting power of the continuing or
surviving entity's securities, entitled to vote generally in the election of
directors and outstanding immediately after such merger, consolidation or other
reorganization is owned by persons who were not stockholders of the Company
immediately prior to such merger, consolidation or other reorganization;

                  b. The sale, transfer or other disposition of all or
substantially all of the Company's assets, if more than fifty percent (50%) of
the combined voting power of the acquiring entity's securities, entitled to vote
generally in the election of directors and outstanding immediately after such
sale, transfer or other disposition is owned by persons who were not
stockholders of the Company immediately prior to such sale, transfer or other
disposition;


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                  c. A change in the composition of the Board, as a result of
which fewer than fifty percent (50%) of the directors are continuing directors,
where the term "continuing director" means at any date a member of the Board (i)
who was a member of the Board on the date of the initial adoption of the Plan by
the Board or (ii) who was nominated or elected subsequent to such date by (x) at
least a majority of the directors who were continuing directors at the time of
such nomination or election or whose election to the Board was recommended or
endorsed by at least a majority of the directors who were continuing directors
at the time of such nomination or election; PROVIDED, HOWEVER, that there shall
be excluded from this clause (ii) any individual whose initial assumption of
office occurred as a result of an actual or threatened election contest with
respect to the election or removal of directors or other actual or threatened
solicitation of proxies or consents, by or on behalf of a person other than the
Board; or

                  d. Any transaction as a result of which any person is the
"beneficial owner" (as defined in Rule 13d-3 under the Exchange Act), directly
or indirectly, of securities of the Company representing at least thirty percent
(30%) of the total voting power of the then-outstanding securities of the
Company entitled to vote generally in the election of directors (the
"Outstanding Company Voting Securities"). For purposes of this Paragraph (d),
the term "person" shall have the same meaning as when used in sections 13(d) and
14(d) of the Exchange Act but shall exclude (i) a trustee or other fiduciary
holding securities under an employee benefit plan of the Company or of a Parent
or Subsidiary and (ii) a corporation owned directly or indirectly by the
stockholders of the Company in substantially the same proportions as their
ownership of the common stock of the Company. For purposes of this paragraph
(d), the following acquisitions shall not constitute a Change in Control: (x)
any acquisition directly from the Company of less than fifty percent (50%) of
the Outstanding Company Voting Securities (excluding an acquisition pursuant to
the exercise, conversion or exchange of any security exercisable for,
convertible into or exchangeable for common stock or voting securities of the
Company, unless the Person exercising, converting or exchanging such security
acquired such security directly from the Company or an underwriter or agent of
the Company), or (y) any acquisition by any employee benefit plan (or related
trust) sponsored or maintained by the Company or any corporation controlled by
the Company.

A transaction shall not constitute a Change in Control if its sole purpose is to
change the state of the Company's incorporation or to create a holding company
that will be owned in substantially the same proportions by the persons who held
the Company's securities immediately before such transaction.

         2.5 "CODE" means the Internal Revenue Code of 1986, as amended.

         2.6 "COMMITTEE" means a committee of the Board, as described in
Article 21.

         2.7 "COMMON SHARE" means one share of the common stock of the Company.

         2.8 "COMPANY" means Advanced Biotherapy, Inc., a Delaware corporation.

         2.9 "CONSULTANT" means any person, including an advisor, engaged by the
Company or an Affiliate to render consulting services and who is compensated for
such services,

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provided that the term "Consultant" shall not include Outside Directors who are
paid only a director's fee by the Company or who are not compensated by the
Company for their services. Service as a Consultant shall be considered
employment for all purposes of the Plan, except as provided in Section 4.1.

         2.10 "EMPLOYEE" means any person, including Officers and Directors,
employed by the Company, a Parent, a Subsidiary or an Affiliate of the Company.
Neither services as an Outside Director nor payment of a director's fee by the
Company shall alone be sufficient to constitute "employment" by the Company.

         2.11 "EXCHANGE ACT" means the Securities Exchange Act of 1934, as
amended.

         2.12 "EXERCISE PRICE," in the case of an Option, means the amount for
which one Common Share may be purchased upon exercise of such Option, as
specified in the applicable Stock Option Agreement. "Exercise Price," in the
case of an SAR, means an amount, as specified in the applicable SAR Agreement,
which is subtracted from the Fair Market Value of one Common Share in
determining the amount payable upon exercise of such SAR.

         2.13 "FAIR MARKET VALUE" means with respect to each Common Share the
last reported sale price of the Company's Common Shares sold on the principal
national securities exchanges on which the Common Shares are at the time
admitted to trading or listed, or, if there have been no sales of any such
exchange on such day, the average of the highest bid and lowest ask price on
such day as reported by the NASDAQ system, or any similar organization if the
NASDAQ is no longer reporting such information, either (i) on the date which the
notice of exercise is deemed to have been sent to the Company (the "Notice
Date") or (ii) over a period of five (5) trading days preceding the Notice Date,
whichever of (i) or (ii) is greater. If on the date for which the current fair
market value is to be determined, the Common Shares are not listed on any
securities exchange or quoted on the NASDAQ system or the over-the-counter
market, the current fair market value of Common Shares shall be the highest
price per share which the Company could then obtain from a willing buyer (not a
current employee or director) for Common Shares sold by the Company, from
authorized but unissued shares, as determined in good faith by the Board of the
Company, unless prior to such date the Company has become subject to a binding
agreement for a merger, acquisition or other consolidation pursuant to which the
Company is not the surviving party, in which case the current fair market value
of the Common Shares shall be deemed to be the value to be received by the
holders of the Company's Common Shares for each share thereof pursuant to the
Company's acquisition. Such determination shall be conclusive and binding on all
persons.

         2.14 "ISO" means an incentive stock option described in Section 422(b)
of the Code.

         2.15 "NSO" means a stock option not described in Sections 422 or 423 of
the Code.

         2.16 "OPTION" means an ISO or NSO granted under the Plan and entitling
the holder to purchase Common Shares.


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         2.17 "OPTIONEE" means an individual or estate who holds an Option or
SAR.

         2.18 "OUTSIDE DIRECTOR" shall mean a member of the Board who is not an
Employee. Service as an Outside Director shall be considered employment for all
purposes of the Plan, except as provided in Section 4.1.

         2.19 "PARENT" means any corporation (other than the Company) in an
unbroken chain of corporations ending with the Company, if each of the
corporations other than the Company owns stock possessing fifty percent (50%) or
more of the total combined voting power of all classes of stock in one of the
other corporations in such chain. A corporation that attains the status of a
Parent on a date after the adoption of the Plan shall be considered a Parent
commencing as of such date.

         2.20 "PARTICIPANT" means an individual or estate who holds an Award.

         2.21 "PLAN" means this Advanced Biotherapy, Inc. 2000 Omnibus Equity
Incentive Plan, as amended from time to time.

         2.22 "RESTRICTED SHARE" means a Common Share awarded under the Plan,
subject to the Restricted Stock Agreement.

         2.23 "RESTRICTED STOCK AGREEMENT" means the agreement between the
Company and the recipient of a Restricted Share which contains the terms,
conditions and restrictions pertaining to such Restricted Share.

         2.24 "SAR" means a stock appreciation right granted under the Plan.

         2.25 "SAR AGREEMENT" means the agreement between the Company and an
Optionee which contains the terms, conditions and restrictions pertaining to his
or her SAR.

         2.26 "SERVICE PROVIDER" means any provider of services to the Company
for which the individual or the individual's employer or company is compensated,
and includes employees, directors and consultants.

         2.27 "STOCK OPTION AGREEMENT" means the agreement between the Company
and an Optionee that contains the terms, conditions and restrictions pertaining
to his or her Option.

         2.28 "STOCK UNIT" means a bookkeeping entry representing the equivalent
of one Common Share, as awarded under the Plan.

         2.29 "STOCK UNIT AGREEMENT" means the agreement between the Company and
the recipient of a Stock Unit which contains the terms, conditions and
restrictions pertaining to such Stock Unit.


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         2.30 "SUBSIDIARY" means any corporation (other than the Company) in an
unbroken chain of corporations beginning with the Company, if each of the
corporations other than the last corporation in the unbroken chain owns stock
possessing fifty percent (50%) or more of the total combined voting power of all
classes of stock in one of the other corporations in such chain. A corporation
that attains the status of a Subsidiary on a date after the adoption of the Plan
shall be considered a Subsidiary commencing as of such date.

ARTICLE 3.  SHARES AVAILABLE FOR GRANTS.

         3.1 BASIC LIMITATION. Common Shares issued pursuant to the Plan may be
authorized but unissued shares or reacquired shares, bought on the market or
otherwise. The aggregate number of Options, SARs, Stock Units and Restricted
Shares awarded under the Plan shall not exceed (a) [Four Million (4,000,000)]
Common Shares plus (b) the additional Common Shares described in Sections 3.2
and 3.3. The limitation of this Section 3.1 shall be subject to adjustment
pursuant to Article 11.

         3.2 ANNUAL INCREASE IN SHARES. As of January 1 of each year, commencing
with the year 2001, the aggregate number of Options, SARs, Stock Units and
Restricted Shares that may be awarded under the Plan shall automatically
increase by a number equal to the lesser of (a) two and one-half percent (2.5%)
of the total number of Common Shares then outstanding or (b) [250,000] Common
Shares. At no time shall (a) the total number of Common Shares issuable upon
exercise of all outstanding Options and the total number of Common Shares
provided for under any stock bonus or similar plan of the Company exceed the
applicable percentage as calculated in accordance with the conditions and
exclusions of applicable state law, rules and regulations, or (b) the amount of
securities offered and sold under the Plan exceed the limitations provided in
Rule 701 under the Securities Act of 1933, as amended.

         3.3 ADDITIONAL SHARES. If Restricted Shares or Common Shares issued
upon the exercise of Options are forfeited, then such Common Shares shall again
become available for Awards under the Plan. If Stock Units, Options or SARs are
forfeited or terminate for any other reason before being exercised, then the
corresponding Common Shares shall again become available for Awards under the
Plan. If Stock Units are settled, then only the number of Common Shares (if any)
actually issued in settlement of such Stock Units shall reduce the number
available under Section 3.1 and the balance shall again become available for
Awards under the Plan. If SARs are exercised, then only the number of Common
Shares (if any) actually issued in settlement of such SARs shall reduce the
number available under Section 3.1 and the balance shall again become available
for Awards under the Plan. The foregoing notwithstanding, the aggregate number
of Common Shares that may be issued under the Plan upon the exercise of ISOs
shall not be increased when Restricted Shares or other Common Shares are
forfeited.


         3.4 DIVIDEND EQUIVALENTS. Any dividend equivalents paid or credited
under the Plan shall not be applied against the number of Restricted Shares,
Stock Units, Options or SARs available for Awards, whether or not such dividend
equivalents are converted into Stock Units.


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ARTICLE 4.  ELIGIBILITY.

         4.1 INCENTIVE STOCK OPTIONS. Only Employees of the Company, a Parent
or a Subsidiary shall be eligible for the grant of ISOs. In addition, an
Employee who owns more than ten percent (10%) of the total combined voting power
of all classes of outstanding stock of the Company or any of its Parents or
Subsidiaries shall not be eligible for the grant of an ISO only when the
requirements set forth in section 422(c)(6) of the Code are satisfied.

         4.2 OTHER GRANTS. Only Employees, Outside Directors and Consultants,
or other Service providers that might be included later, shall be eligible for
the grant of Restricted Shares, Stock Units, NSOs or SARs under the Plan.

         4.3 NONASSIGNABILITY. Except as otherwise specifically set forth in
this Plan or as approved by the Committee, no Award or right granted to any
person under the Plan shall be assignable or transferable other than by will or
by the laws of descent and distribution, and all such Awards and rights shall be
exercisable during the life of the Participant only by the Participant or the
Participant's legal representative.

         4.4 REQUIREMENT OF NOTIFICATION OF ELECTION UNDER SECTION 83(b) OF THE
CODE. If a Participant, in connection with the acquisition of Common Shares
under the Plan, is permitted under the terms of the Award agreement to make the
election permitted under Section 83(b) of the Code (i.e., an election to include
in gross income in the year of transfer the amounts specified in Code Section
83(b) notwithstanding the continuing transfer restrictions) and the Participant
makes such an election, the Participant shall notify the Company of such
election within ten (10) days of filing notice of the election with the Internal
Revenue Service, in addition to any filing and notification required pursuant to
regulations issued under the authority of Code Section 83(b).

         4.5 REQUIREMENT OF NOTIFICATION UPON DISQUALIFYING DISPOSITION UNDER
SECTION 421(b) OF THE CODE. If any Participant shall make any disposition of
Common Shares issued pursuant to the exercise of an incentive stock option under
the circumstances described in Section 421(b) of the code (relating to certain
disqualifying dispositions), such Participant shall notify the Company of such
disposition within 10 days thereof.

ARTICLE 5.  OPTIONS.

         5.1 STOCK OPTION AGREEMENT. Each grant of an Option under the Plan
shall be evidenced by a Stock Option Agreement between the Optionee and the
Company. Such Option shall be subject to all applicable terms of the Plan and
may be subject to any other terms that are not inconsistent with the Plan. The
Stock Option Agreement shall specify whether the Option is an ISO or an NSO. The
provisions of the various Stock Option Agreements entered into under the Plan
need not be identical. Options may be granted in consideration of a reduction in
the Optionee's other compensation. A Stock Option Agreement may provide that a
new



<PAGE>

Option will be granted automatically to the Optionee when he or she exercises a
prior Option and pays the Exercise Price in the form described in Section 6.2.

         5.2 NUMBER OF SHARES. Each Stock Option Agreement shall specify the
number of Common Shares subject to the Option and shall provide for the
adjustment of such number in accordance with Article 11.

         5.3 EXERCISE PRICE. Each Stock Option Agreement shall specify the
Exercise Price; provided that the Exercise Price under an ISO shall in no event
be less than one hundred percent (100%) (one hundred ten percent (110%) in the
case of any person who owns more than ten percent (10%) of the total combined
voting power of all classes of capital stock of the Company or any of its
Subsidiaries) of the Fair Market Value of a Common Share on the date of grant
and the Exercise Price under an NSO shall in no event be less than eighty-five
percent (85%) of the Fair Market Value of a Common Share on the date of grant.

         5.4 EXERCISABILITY AND TERM. Each Stock Option Agreement shall specify
the date or event when all or any installment of the Option is to become
exercisable, which may include vesting requirements and/or performance criteria
with respect to the Company and/or the Optionee, provided, however, that an
Option granted to a non-officer Employee shall vest at least twenty percent
(20%) of the grant per year. The Stock Option Agreement shall also specify the
term of the Option; provided that the term of an ISO shall in no event exceed
ten (10) years from the date of grant. A Stock Option Agreement may provide for
accelerated exercisability in the event of the Optionee's death, disability or
retirement or other events and may provide for expiration prior to the end of
its term in the event of the termination of the Optionee's service. Options may
be awarded in combination with SARs, and such an Award may provide that the
Options will not be exercisable unless the related SARs are forfeited.

         5.5 MANNER OF EXERCISE. An Option shall be deemed exercised when the
Company receives: (i) notice of exercise (in accordance with the Stock Option
Agreement) from the person entitled to exercise the Option, and (ii) full
payment for the Common Shares with respect to which the Option is exercised.
Full payment may consist of any consideration and method of payment authorized
by the Committee and permitted by the Stock Option Agreement. Common 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 Common 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
stockholder shall exist with respect to the Common Shares subject to the Option,
notwithstanding the exercise of the Option. The Company shall issue (or cause to
be issued) such Common 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 Common Shares are issued, except as provided in Article
11 of the Plan.

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


<PAGE>

         5.6   EFFECT ON OPTION OF DEATH OR OTHER TERMINATION OF EMPLOYMENT,
DIRECTORSHIP OR CONSULTANCY.

                  a. In the event of termination of the employment, directorship
or consultancy (as applicable) of a Participant, including, without limitation,
retirement other than (i) a termination for cause, or (ii) a termination by
reason of disability as determined by the Board in accordance with applicable
Company personnel policies ("Disability") or death, the Participant may exercise
his Option at any time within three (3) months after such termination, or such
other time as the Board shall authorize, to the extent his Option was
exercisable by him at the date of such termination, but in no event after the
expiration of the term thereof; PROVIDED, HOWEVER, that in no event shall such
exercise right expire fewer than thirty (30) days after such termination. In the
event of the termination of the employment, directorship or consultancy (as
applicable) of a Participant that is for cause, any Option held by him, to the
extent not theretofore exercised, shall forthwith terminate. Options shall not
be affected by any change of employment, directorship or consultancy (as
applicable) so long as the Participant continues to be an employee, director or
consultant (as applicable) of the Company or a Subsidiary. The Stock Option
Agreement may contain such provisions as the Board shall approve with reference
to the effect of approved leaves of absence. "Termination for cause" shall
include the meaning of that term as set forth in California Labor Code Sections
2924 and 2925 and case law related thereto and, in addition, shall include for
cause termination under the terms of the Plan, any Stock Option Agreement and
any employment agreement applicable to the person in question as well as
voluntary termination on the part of the Participant without the prior written
consent of the Company.

                  b. In the event of the death or Disability of a Participant
while he is employed by, engaged as a consultant to or serving as a director (as
applicable) of the Company or a Subsidiary (or within three (3) months after
termination thereof), such Option (unless it shall have been previously
terminated pursuant to the provisions of clause (a) above) may be exercised (to
the extent the Participant's Option was exercisable at the date of death or
Disability) by a beneficiary or beneficiaries of such Participant under the
Participant's will, or by his personal representatives or distributees or such
Participant (as applicable), at any time within a period of six (6) months after
his death or Disability, but not after the expiration of the term thereof;
provided, however, that in no event shall such exercise right expire fewer than
six (6) months after the date of termination of employment, consultancy or
directorship (as applicable).

                  c. No transfer of an Option by the Participant by will or by
the laws of descent and distribution shall be effective to bind the Company
unless the Company shall have been furnished with written notice thereof and an
authenticated copy of the will and/or such other evidence as the Board may deem
necessary to establish the validity of the transfer and the acceptance by the
transferee or transferees of the terms and conditions of such Option.

         5.7 EFFECT OF CHANGE IN CONTROL. The Committee may determine, at the
time of granting an Option or thereafter, that such Option shall become
exercisable as to all or part of the Common Shares subject to such Option in the
event that a Change in Control occurs



<PAGE>

with respect to the Company, subject to Section 11.1 below and subject to the
following limitations:

         a. In the case of an ISO, the acceleration of exercisability shall not
occur without the Optionee's written consent.

         b. If the Company and the other party to the transaction constituting a
Change in Control agree that such transaction is to be treated as a "pooling of
interests" for financial reporting purposes, and if such transaction in fact is
so treated, then the acceleration of exercisability shall not occur to the
extent that the Company's independent accountants and such other party's
independent accountants separately determine in good faith that such
acceleration would preclude the use of "pooling of interests" accounting.

         5.8 MODIFICATION OR ASSUMPTION OF OPTIONS. Within the limitations of
the Plan, the Committee may modify, extend or assume outstanding options or may
accept the cancellation of outstanding options (whether granted by the Company
or by another issuer) in return for the grant of new options for the same or a
different number of Common Shares and at the same or a different exercise price.
The foregoing notwithstanding, no modification of an Option shall, without the
consent of the Optionee, alter or impair his or her rights or obligations
determined pursuant to the Option Agreement representing such Option.

         5.9 BUYOUT PROVISIONS. The Committee may at any time (a) offer to buy
out for a payment in cash or cash equivalents an Option previously granted or
(b) authorize an Optionee to elect to cash out an Option previously granted, in
either case at such time and based upon such terms and conditions as the
Committee shall establish.

         5.10 COMPANY'S RIGHT OF FIRST REFUSAL. Before any Common Shares held by
Optionee or any transferee (either being sometimes referred to herein as the
"Holder") may be sold or otherwise transferred (including transfer by gift or
operation of law), the Company or its assignee(s) shall have a right of first
refusal to purchase the Common Shares on the terms and conditions set forth in
this Section (the "Right of First Refusal").

                  a. NOTICE OF PROPOSED TRANSFER. The Holder of the Common
Shares shall deliver to the Company a written notice (the "Notice") stating: (i)
the Holder's bona fide intention to sell or otherwise transfer such Common
Shares; (ii) the name of each proposed purchaser or other transferee (the
"Proposed Transferee"); (iii) the number of Common Shares to be transferred to
each Proposed Transferee; and (iv) the bona fide cash price or other
consideration for which the Holder proposes to transfer the Common Shares (the
"Offered Price"), and the Holder shall offer the Common Shares at the Offered
Price to the Company or its assignee(s).

                  b. EXERCISE OF RIGHT OF FIRST REFUSAL. At any time within
thirty (30) days after receipt of the Notice, the Company and/or its assignee(s)
may, by giving written notice to the Holder, elect to purchase all, but not less
than all, of the Common Shares proposed to be


<PAGE>

transferred to any one or more of the Proposed Transferees, at the purchase
price determined in accordance with subsection (c) below.

                  c. PURCHASE PRICE. The purchase price (the "Purchase Price")
for the Common Shares purchased by the Company or its assignee(s) under this
Section shall be the Offered Price. If the Offered Price includes consideration
other than cash, the cash equivalent value of the non-cash consideration shall
be determined by the Company in good faith.

                  d PAYMENT. Payment of the Purchase Price shall be made, at the
option of the Company or its assignee(s), in cash, by check, by cancellation of
all or a portion of any outstanding indebtedness of the Holder to the Company
(or, in the case of repurchase by an assignee, to the assignee), or by any
combination thereof within 30 days after receipt of the Notice or in the manner
and at the times set forth in the Notice.

                  e. HOLDER'S RIGHT TO TRANSFER. If all of the Common Shares
proposed in the Notice to be transferred to a given Proposed Transferee are not
purchased by the Company and/or its assignee(s) as provided in this Section,
then the Holder may sell or otherwise transfer such Common Shares to that
Proposed Transferee at the Offered Price or at a higher price, provided that
such sale or other transfer is consummated within 120 days after the date of the
Notice and provided further that any such sale or other transfer is effected in
accordance with any applicable securities laws and the Proposed Transferee
agrees in writing that the provisions of this Section shall continue to apply to
the Common Shares in the hands of such Proposed Transferee. If the Common Shares
described in the Notice are not transferred to the Proposed Transferee within
such period, a new Notice shall be given to the Company, and the Company and/or
its assignees shall again be offered the Right of First Refusal before any
Common Shares held by the Holder may be sold or otherwise transferred.

                  f. EXCEPTION FOR CERTAIN FAMILY TRANSFERS. Anything to the
contrary contained in this Section notwithstanding, the transfer of any or all
of the Common Shares during the Optionee's lifetime or on the Optionee's death
by will or intestacy to the Optionee's immediate family or to trusts
established, in whole or in part, for the benefit of the Optionee and/or one or
more of such immediate family members shall be exempt from the provisions of
this Section. For purposes of the Plan, (i) the term "immediate family" shall
mean the Optionee's spouse and issue (including adopted and stepchildren) and
(ii) the phrase "immediate family members and trusts established in whole or in
part for the benefit of the Optionee and/or one or more of such immediate family
members" shall be further limited, if necessary, so that neither the transfer of
an NSO to such immediate family member or trust, nor the ability of an Optionee
to make such a transfer shall have adverse consequences to the Company or the
Optionee by reason of Section 162(m) of the Code. In such case, the transferee
or other recipient shall receive and hold the Common Shares so transferred
subject to the provisions of this Section, and there shall be no further
transfer of such Common Shares except in accordance with the terms of this
Section.

                  g. TERMINATION OF RIGHT OF FIRST REFUSAL. The Right of First
Refusal shall terminate upon the earlier of (i) two (2) years after the date of
issuance to the Optionee of such



<PAGE>

Common Shares or (ii) the date on which such Common Shares shall be registered
pursuant to a registration statement filed with and declared effective by the
Securities and Exchange Commission under the Securities Act of 1933, as amended.

         5.11 COMPANY'S RIGHT OF RECAPTURE. To the extent provided in the
Restricted Stock Agreement, Stock Option Agreement, or Stock Unit Agreement, as
applicable, if at any time within one (1) year after the date on which a
Participant exercises an Option or SAR, or on which Restricted Shares vest, or
which is the maturity date of Stock Units, or on which income is realized by a
Participant in connection with any other stock-based Award (each of which events
is a "realization event"), the Participant is terminated for cause (or, if still
employed by the Company, engages in any activity that would constitute a basis
for a termination for cause), then any gain realized by the Participant from the
realization event shall be paid by the Participant to the Company upon notice
from the Company. Such gain shall be determined on a gross basis, without
reduction for any taxes incurred, as of the date of the realization event,
without regard to any subsequent change in the Fair Market Value of a Common
Share. The Company shall have the right to offset such gain against any amounts
otherwise owed to the Participant by the Company (whether as wages, vacation
pay, or pursuant to any benefit plan or other compensatory arrangement).

ARTICLE 6.  PAYMENT FOR OPTION SHARES.

         6.1 GENERAL RULE. The entire Exercise Price of Common Shares issued
upon exercise of Options shall be payable in cash or cash equivalents at the
time when such Common Shares are purchased, except as follows:

         a. In the case of an ISO granted under the Plan, payment shall be made
only pursuant to the express provisions of the applicable Stock Option
Agreement. The Stock Option Agreement may specify that payment may be made in
any form(s) described in this Article 6.

         b. In the case of an NSO, the Committee may at any time accept payment
in any form(s) described in this Article 6.

         6.2 SURRENDER OF STOCK. To the extent that this Section 6.2 is
applicable, all or any part of the Exercise Price may be paid by surrendering,
or attesting to the ownership of, Common Shares that are already owned by the
Optionee. Such Common Shares shall be valued at their Fair Market Value on the
date when the new Common Shares are purchased under the Plan. The Optionee shall
not surrender, or attest to the ownership of, Common Shares in payment of the
Exercise Price if such action would cause the Company to recognize compensation
expense (or additional compensation expense) with respect to the Option for
financial reporting purposes.

         6.3 NET EXERCISE. Instead of exercising the Option by paying the
Exercise Price in cash, check or other appropriate consideration, the
Optionee may elect to exercise the Option in whole or in part by receiving
Common Shares equal to the value (as determined below) of the Option, or any
part hereof, upon surrender of the Option at the principal office of the
Company

<PAGE>

together with the notice of exercise annexed to the Stock Option Agreement in
which event the Company shall issue to the Optionee a number of Common Shares
computed using the following formula:

                             X=Y(A-B)
                               ------
                                  A

         Where    X = the number of Common Shares to be issued to the Holder;

                  Y = the number of Common Shares underlying the Option to
                      be exercised;

                  A = the current fair market value of one Common Share; and

                  B = the Exercise Price of the Option.

         As used herein, current fair market value of Common Share shall mean
with respect to each Common Share the last reported sale price of the Company's
Common Shares sold on the principal national securities exchanges on which the
Common Shares are at the time admitted to trading or listed, or, if there have
been no sales of any such exchange on such day, the average of the highest bid
and lowest ask price on such day as reported by the National Association of
Securities Dealers Automated Quotation system ("NASDAQ"), or any similar
organization if the NASDAQ is no longer reporting such information, either (i)
on the date which the notice of exercise is deemed to have been sent to the
Company (the "Notice Date") or (ii) over a period of five (5) trading days
preceding the Notice Date, whichever of (i) or (ii) is greater. If on the date
for which the current fair market value is to be determined, the Common Shares
are not listed on any securities exchange or quoted on the NASDAQ system or the
over-the-counter market, the current fair market value of Common Shares shall be
the highest price per share which the Company could then obtain from a willing
buyer (not a current employee or director) for Common Shares sold by the
Company, from authorized but unissued shares, as determined in good faith by the
Board of the Company, unless prior to such date the Company has become subject
to a binding agreement for a merger, acquisition or other consolidation pursuant
to which the Company is not the surviving party, in which case the current fair
market value of the Common Shares shall be deemed to be the value to be received
by the holders of the Company's Common Shares for each share thereof pursuant to
the Company's acquisition.

         6.4 EXERCISE/SALE. To the extent that this Section 6.4 is applicable,
all or any part of the Exercise Price and any withholding taxes may be paid by
delivering (on a form prescribed by the Company) an irrevocable direction to a
securities broker approved by the Company to sell all or part of the Common
Shares being purchased under the Plan and to deliver all or part of the sales
proceeds to the Company.

         6.5 EXERCISE/PLEDGE. To the extent that this Section 6.5 is applicable,
all or any part of the Exercise Price and any withholding taxes may be paid by
delivering (on a form prescribed by the Company) an irrevocable direction to
pledge all or part of the Common Shares



<PAGE>

being purchased under the Plan to a securities broker or lender approved by the
Company, as security for a loan, and to deliver all or part of the loan proceeds
to the Company.

         6.6 PROMISSORY NOTE. To the extent that this Section 6.6 is applicable,
all or any part of the Exercise Price and any withholding taxes may be paid by
delivering (on a form prescribed by the Company) a full-recourse promissory
note. However, the par value of the Common Shares being purchased under the
Plan, if newly issued, shall be paid in cash or cash equivalents.

         6.7 OTHER FORMS OF PAYMENT. To the extent that this Section 6.7 is
applicable, all or any part of the Exercise Price and any withholding taxes may
be paid in any other form that is consistent with applicable laws, regulations
and rules.

ARTICLE 7.  OPTION GRANTS TO OUTSIDE DIRECTORS/AFFILIATES.

         The Committee may provide in its sole discretion that the NSOs that
otherwise would be granted to an Outside Director under this Plan shall instead
be granted to an affiliate of such Outside Director. Such affiliate shall then
be deemed to be an Outside Director for purposes of the Plan, provided that the
service-related vesting and termination provisions pertaining to the NSOs shall
be applied with regard to the service of the Outside Director.

ARTICLE 8.  STOCK APPRECIATION RIGHTS.

         8.1 SAR AGREEMENT. Each grant of an SAR under the Plan shall be
evidenced by an SAR Agreement between the Optionee and the Company. Such SAR
shall be subject to all applicable terms of the Plan and may be subject to any
other terms that are not inconsistent with the Plan. The provisions of the
various SAR Agreements entered into under the Plan need not be identical. SARs
may be granted in consideration of a reduction in the Optionee's other
compensation.

         8.2 NUMBER OF SHARES. Each SAR Agreement shall specify the number of
Common Shares to which the SAR pertains and shall provide for the adjustment of
such number in accordance with Article 11.

         8.3 EXERCISE PRICE. Each SAR Agreement shall specify the Exercise
Price. An SAR Agreement may specify an Exercise Price that varies in accordance
with a predetermined formula while the SAR is outstanding.

         8.4 EXERCISABILITY AND TERM. Each SAR Agreement shall specify the date
when all or any installment of the SAR is to become exercisable. The SAR
Agreement shall also specify the term of the SAR. An SAR Agreement may provide
for accelerated exercisability in the event of the Optionee's death, disability
or retirement or other events and may provide for expiration prior to the end of
its term in the event of the termination of the Optionee's service. SARs may be
awarded in combination with Options, and such an Award may provide that the SARs
will not be exercisable unless the related Options are forfeited. An SAR may be
included in an ISO only at the time of grant but may be included


<PAGE>

in an NSO at the time of grant or thereafter. An SAR granted under the Plan may
provide that it will be exercisable only in the event of a Change in Control.

         8.5 EFFECT OF CHANGE IN CONTROL. The Committee may determine, at the
time of granting an SAR or thereafter, that such SAR shall become fully
exercisable as to all Common Shares subject to such SAR in the event that a
Change in Control occurs with respect to the Company, subject to Section 11.3
and subject to the following sentence. If the Company and the other party to the
transaction constituting a Change in Control agree that such transaction is to
be treated as a "pooling of interests" for financial reporting purposes, and if
such transaction in fact is so treated, then the acceleration of exercisability
shall not occur to the extent that the Company's independent accountants and
such other party's independent accountants separately determine in good faith
that such acceleration would preclude the use of "pooling of interests"
accounting.

         8.6 EXERCISE OF SARS. Upon exercise of an SAR, the Optionee (or any
person having the right to exercise the SAR after his or her death) shall
receive from the Company (a) Common Shares, (b) cash or (c) a combination of
Common Shares and cash, as the Committee shall determine. The amount of cash
and/or the Fair Market Value of Common Shares received upon exercise of SARs
shall, in the aggregate, be equal to the amount by which the Fair Market Value
(on the date of surrender) of the Common Shares subject to the SARs exceeds the
Exercise Price. If, on the date when an SAR expires, the Exercise Price under
such SAR is less than the Fair Market Value on such date but any portion of such
SAR has not been exercised or surrendered, then such SAR shall automatically be
deemed to be exercised as of such date with respect to such portion.

         8.7 MODIFICATION OR ASSUMPTION OF SARS. Within the limitations of the
Plan, the Committee may modify, extend or assume outstanding SARs or may accept
the cancellation of outstanding SARs (whether granted by the Company or by
another issuer) in return for the grant of new SARs for the same or a different
number of Common Shares and at the same or a different exercise price. The
foregoing notwithstanding, no modification of an SAR shall, without the consent
of the Optionee, alter or impair his or her rights or obligations under such
SAR.

ARTICLE 9.  RESTRICTED SHARES.

         9.1 RESTRICTED STOCK AGREEMENT. Each grant of Restricted Shares under
the Plan shall be evidenced by a Restricted Stock Agreement between the
recipient and the Company. Such Restricted Shares shall be subject to all
applicable terms of the Plan and may be subject to any other terms that are not
inconsistent with the Plan. The provisions of the various Restricted Stock
Agreements entered into under the Plan need not be identical.

         9.2 PAYMENT FOR AWARDS. Subject to the following sentence, Restricted
Shares may be sold or awarded under the Plan for such consideration as the
Committee may determine, including (without limitation) cash, cash equivalents,
full-recourse promissory notes, past services and future services. To the extent
that an Award consists of newly issued Restricted


<PAGE>

Shares, the Award recipient shall furnish consideration with a value not less
than the par value of such Restricted Shares in the form of cash, cash
equivalents or past services rendered to the Company (or a Parent or
Subsidiary), as the Committee may determine.

         9.3 VESTING CONDITIONS. Each Award of Restricted Shares may or may not
be subject to vesting. Vesting shall occur, in full or in installments, upon
satisfaction of the conditions specified in the Restricted Stock Agreement. A
Restricted Stock Agreement may provide for accelerated vesting in the event of
the Participant's death, disability or retirement or other events. The Committee
may determine, at the time of granting Restricted Shares or thereafter, that all
or part of such Restricted Shares shall become vested in the event that a Change
in Control occurs with respect to the Company, except as provided in the next
following sentence. If the Company and the other party to the transaction
constituting a Change in Control agree that such transaction is to be treated as
a "pooling of interests" for financial reporting purposes, and if such
transaction in fact is so treated, then the acceleration of vesting shall not
occur to the extent that the Company's independent accountants and such other
party's independent accountants separately determine in good faith that such
acceleration would preclude the use of "pooling of interests" accounting.

         9.4 VOTING AND DIVIDEND RIGHTS. The holders of Restricted Shares
awarded under the Plan shall have the same voting, dividend and other rights as
the Company's other stockholders. A Restricted Stock Agreement, however, may
require that the holders of Restricted Shares invest any cash dividends received
in additional Restricted Shares. Such additional Restricted Shares shall be
subject to the same conditions and restrictions as the Award with respect to
which the dividends were paid.

         9.5 REPURCHASE OPTION. Unless the Committee determines otherwise, the
Restricted Stock 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 Common Shares repurchased pursuant to the Restricted Stock
Agreement shall be the original purchase price paid by the purchaser and may be
paid by cancellation of any indebtedness of the purchaser to the Company. The
repurchase option for non-officer employees shall lapse at such rate as the
Committee may determine, but at a minimum rate of twenty percent (20%) per year.

ARTICLE 10.  STOCK UNITS.

         10.1 STOCK UNIT AGREEMENT. Each grant of Stock Units under the Plan
shall be evidenced by a Stock Unit Agreement between the recipient and the
Company. Such Stock Units shall be subject to all applicable terms of the Plan
and may be subject to any other terms that are not inconsistent with the Plan.
The provisions of the various Stock Unit Agreements entered into under the Plan
need not be identical. Stock Units may be granted in consideration of a
reduction in the recipient's other compensation.

         10.2 PAYMENT FOR AWARDS. To the extent that an Award is granted in the
form of Stock Units, no cash consideration shall be required of the Award
recipients.


<PAGE>

         10.3 VESTING CONDITIONS. Each Award of Stock Units may or may not be
subject to vesting. Vesting shall occur, in full or in installments, upon
satisfaction of the conditions specified in the Stock Unit Agreement. A Stock
Unit Agreement may provide for accelerated vesting in the event of the
Participant's death, disability or retirement or other events. The Committee may
determine, at the time of granting Stock Units or thereafter, that all or part
of such Stock Units shall become vested in the event that a Change in Control
occurs with respect to the Company, subject to Section 11.3, and except as
provided in the next following sentence. If the Company and the other party to
the transaction constituting a Change in Control agree that such transaction is
to be treated as a "pooling of interests" for financial reporting purposes, and
if such transaction in fact is so treated, then the acceleration of vesting
shall not occur to the extent that the Company's independent accountants and
such other party's independent accountants separately determine in good faith
that such acceleration would preclude the use of "pooling of interests"
accounting.

         10.4 VOTING AND DIVIDEND RIGHTS. The holders of Stock Units shall have
no voting rights. Prior to settlement or forfeiture, any Stock Unit awarded
under the Plan may, at the Committee's discretion, carry with it a right to
dividend equivalents. Such right entitles the holder to be credited with an
amount equal to all cash dividends paid on one Common Share while the Stock Unit
is outstanding. Dividend equivalents may be converted into additional Stock
Units. Settlement of dividend equivalents may be made in the form of cash, in
the form of Common Shares, or in a combination of both. Prior to distribution,
any dividend equivalents which are not paid shall be subject to the same
conditions and restrictions as the Stock Units to which they attach.

         10.5 FORM AND TIME OF SETTLEMENT OF STOCK UNITS. Settlement of vested
Stock Units may be made in the form of (a) cash, (b) Common Shares or (c) any
combination of both, as determined by the Committee. The actual number of Stock
Units eligible for settlement may be larger or smaller than the number included
in the original Award, based on predetermined performance factors. Methods of
converting Stock Units into cash may include (without limitation) a method based
on the average Fair Market Value of Common Shares over a series of trading days.
Vested Stock Units may be settled in a lump sum or in installments. The
distribution may occur or commence when all vesting conditions applicable to the
Stock Units have been satisfied or have lapsed, or it may be deferred to any
later date. The amount of a deferred distribution may be increased by an
interest factor or by dividend equivalents. Until an Award of Stock Units is
settled, the number of such Stock Units shall be subject to adjustment pursuant
to Article 11.

         10.6 DEATH OF RECIPIENT. Any Stock Units Award that becomes payable
after the recipient's death shall be distributed to the recipient's beneficiary
or beneficiaries. Each recipient of a Stock Units Award under the Plan shall
designate one or more beneficiaries for this purpose by filing the prescribed
form with the Company. A beneficiary designation may be changed by filing the
prescribed form with the Company at any time before the Award recipient's death.
If no beneficiary was designated or if no designated beneficiary survives the
Award recipient, then


<PAGE>

any Stock Units Award that becomes payable after the recipient's death shall be
distributed to the recipient's estate.

         10.7 CREDITORS' RIGHTS. A holder of Stock Units shall have no rights
other than those of a general creditor of the Company. Stock Units represent an
unfunded and unsecured obligation of the Company, subject to the terms and
conditions of the applicable Stock Unit Agreement.

ARTICLE 11.  PROTECTION AGAINST DILUTION.

         11.1 ADJUSTMENTS. In the event of a subdivision of the outstanding
Common Shares, a declaration of a dividend payable in Common Shares, a
declaration of a dividend payable in a form other than Common Shares in an
amount that has a material effect on the price of Common Shares, a combination
or consolidation of the outstanding Common Shares (by reclassification or
otherwise) into a lesser number of Common Shares, a recapitalization, a spin-off
or a similar occurrence, the Committee shall make such adjustments as it, in its
sole discretion, deems appropriate in one or more of:

         a. The number of Options, SARs, Restricted Shares and Stock Units
available for future Awards under Article 3;

         b. The limitations set forth in Sections 5.2 and 8.2;

         c. The number of NSOs to be granted to Outside Directors under
Article 7;

         d. The number of Common Shares covered by each outstanding Option and
SAR;

         e. The Exercise Price under each outstanding Option and SAR; or

         f. The number of Stock Units included in any prior Award which has not
yet been settled.

Except as provided in this Article 11, a Participant shall have no rights by
reason of any issue by the Company of stock of any class or securities
convertible into stock of any class, any subdivision or consolidation of shares
of stock of any class, the payment of any stock dividend or any other increase
or decrease in the number of shares of stock of any class.

         11.2 DISSOLUTION OR LIQUIDATION. To the extent not previously exercised
or settled, Options, SARs and Stock Units shall terminate immediately prior to
the dissolution or liquidation of the Company.

         11.3 REORGANIZATIONS. In the event that the Company is a party to a
merger, consolidation or other corporate reorganization, outstanding Awards
shall be subject to the



<PAGE>

agreement of merger, consolidation or corporate reorganization, or subject to
determination by the Board. Such agreement shall provide for one or more of the
following events:

         a. The continuation of the outstanding Awards by the Company, if the
Company is a surviving corporation;

         b. The assumption of the outstanding Awards by the surviving
corporation or its parent or subsidiary;

         c. The substitution by the surviving corporation or its parent or
subsidiary of its own awards for the outstanding Awards;

         d. Full exercisability or vesting and accelerated expiration of the
outstanding Awards; or

         e. Settlement of the full value of the outstanding Awards in cash or
cash equivalents followed by cancellation of such Awards.

Notwithstanding anything to the contrary herein, this Section 11.3 shall control
in the event of a Change in Control.

ARTICLE 12.  DEFERRAL OF AWARDS.

         The Committee, in its sole discretion, may permit or require a
Participant to:

         a. Have cash that otherwise would be paid to such Participant as a
result of the exercise of an SAR or the settlement of Stock Units credited to a
deferred compensation account established for such Participant by the Committee
as an entry on the Company's books;

         b. Have Common Shares that otherwise would be delivered to such
Participant as a result of the exercise of an Option or SAR converted into an
equal number of Stock Units; or

         c. Have Common Shares that otherwise would be delivered to such
Participant as a result of the exercise of an Option or SAR or the settlement of
Stock Units converted into amounts credited to a deferred compensation account
established for such Participant by the Committee as an entry on the Company's
books. Such amounts shall be determined by reference to the Fair Market Value of
such Common Shares as of the date when they otherwise would have been delivered
to such Participant.

A deferred compensation account established under this Article 12 may be
credited with interest or other forms of investment return, as determined by the
Committee. A Participant for whom such an account is established shall have no
rights other than those of a general creditor of the Company. Such an account
shall represent an unfunded and unsecured obligation of the Company and shall be
subject to the terms and conditions of the applicable agreement between



<PAGE>


such Participant and the Company. If the deferral or conversion of Awards is
permitted or required, the Committee (in its sole discretion) may establish
rules, procedures and forms pertaining to such Awards, including (without
limitation) the settlement of deferred compensation accounts established under
this Article 12.

ARTICLE 13.  AWARDS UNDER OTHER PLANS.

         The Company may grant awards under other plans or programs. Such awards
may be settled in the form of Common Shares issued under this Plan. Such Common
Shares shall be treated for all purposes under the Plan like Common Shares
issued in settlement of Stock Units and shall, when issued, reduce the number of
Common Shares available under Article 3.

ARTICLE 14.  PAYMENT OF DIRECTOR'S FEES IN SECURITIES.

         14.1 EFFECTIVE DATE. No provision of this Article 14 shall be effective
unless and until the Board has determined to implement such provision.

         14.2 ELECTIONS TO RECEIVE NSOs, RESTRICTED SHARES OR STOCK UNITS. An
Outside Director may elect to receive his or her annual retainer payments and/or
meeting fees from the Company in the form of cash, NSOs, Restricted Shares or
Stock Units, or a combination thereof, as determined by the Board. Such NSOs,
Restricted Shares and Stock Units shall be issued under the Plan. An election
under this Article 14 shall be filed with the Company on the prescribed form.

         14.3 NUMBER AND TERMS OF NSOs, RESTRICTED SHARES OR STOCK UNITS. The
number of NSOs, Restricted Shares or Stock Units to be granted to Outside
Directors in lieu of annual retainers and meeting fees that would otherwise be
paid in cash shall be calculated in a manner determined by the Board. The terms
of such NSOs, Restricted Shares or Stock Units shall also be determined by the
Board.

ARTICLE 15.  LIMITATION ON RIGHTS.

         15.1 RETENTION RIGHTS. Neither the Plan nor any Award granted under the
Plan shall be deemed to give any individual a right to remain an Employee,
Outside Director or Consultant. The Company and its Parents, Subsidiaries and
Affiliates reserve the right to terminate the service of any Employee, Outside
Director or Consultant at any time, with or without cause, subject to applicable
laws, the Company's certificate of incorporation and by-laws and a written
employment agreement (if any).

         15.2 STOCKHOLDERS' RIGHTS. A Participant shall have no dividend rights,
voting rights or other rights as a stockholder with respect to any Common Shares
covered by his or her Award prior to the time when a stock certificate for such
Common Shares is issued or, if applicable, the time when he or she becomes
entitled to receive such Common Shares by filing any required notice of exercise
and paying any required Exercise Price. No adjustment shall be



<PAGE>

made for cash dividends or other rights for which the record date is prior to
such time, except as expressly provided in the Plan.

         15.3 CONDITIONS UPON ISSUANCE OF COMMON SHARES.

         a. LEGAL COMPLIANCE. Common Shares shall not be issued pursuant to the
exercise of an Award unless the exercise of such Award and the issuance and
delivery of such Common Shares shall comply with all relevant provisions of law,
including, without limitation, the Securities Act, as amended, the Exchange Act,
the securities laws of applicable states, the rules and regulations promulgated
thereunder, applicable laws, and the requirements of any stock exchange or
quotation system upon which the Common Shares may then be listed or quoted, and
shall be further subject to the approval of counsel for the Company with respect
to such compliance.

         b. INVESTMENT REPRESENTATIONS RE: FEDERAL SECURITIES LAWS. The Common
Shares underlying the Awards, as of the date the Plan was approved by the Board,
have not been registered under the Securities Act. The Participant shall be
required to represent that if Awards are exercised in whole or in part at a time
when there is not in effect, under the Securities Act, a registration statement
applicable to the Common Shares issuable upon exercise, then the purchase of
such Common Shares shall be subject to obtaining such representation, warranties
and covenants from the Participants as the Committee shall determine, including,
without limitation:

              (i) INVESTMENT INTENT. Participant is acquiring the Common
Shares for its own account, not as a nominee or agent, and not with a view to
their resale or distribution and is prepared to hold the Common Shares for an
indefinite period and has no present intention to sell, distribute, or grant
any participating interests in the Common Shares. Participant acknowledges
the Common Shares have not been registered under the Securities Act or the
securities laws of any other state, province or country (collectively, with
the 1933 Act, the "Securities Laws"), and that the Company is issuing the
Common Shares to it in reliance on such representations.

              (ii) RESTRICTED SECURITIES. Participant confirms it has been
informed that the Common Shares may not be resold or transferred unless such
Common Shares are first registered under the applicable Securities Laws or
unless an exemption from such registration is available.

               (iii) INVESTMENT EXPERIENCE. In connection with the investment
representations made, Participant represents that it is able to fend for
itself in the transactions contemplated by the Plan, has such knowledge and
experience in financial and business matters as to be capable of evaluating
the merits and risks of its investment, has the ability to bear the economic
risks of its investment, and has been furnished with and has had access to
such information as is normally made available in the form of a registration
statement, together with such additional information as is necessary to
verify the accuracy of the information supplied and to have all questions
answered by the Company.

<PAGE>

              (iv) DISPOSITION OF SHARES. Participant shall make no
disposition of the Common Shares, unless and until:

                   (1) Participant shall have complied with all requirements
of the Plan and any stock exchange on which such Common Shares (or any
substituted securities) may be listed;

                   (2) Participant shall have notified the Company of the
proposed disposition and furnished it with a written summary of the terms and
conditions of the proposed disposition; and

                   (3) Participant shall have provided an opinion to the
Company's counsel (at its expense), in form and substance reasonably
satisfactory to the Company, that (i) the proposed disposition does not
require registration of the Common Shares under the applicable Securities
Laws or (ii) all appropriate action necessary for compliance with the
registration requirements of the applicable Securities Laws or of any
exemption from registration available under the applicable Securities Laws
has been taken.

ARTICLE 16.  WITHHOLDING TAXES.

         16.1 GENERAL. To the extent required by applicable federal, state,
local or foreign law, a Participant or his or her successor shall make
arrangements satisfactory to the Company for the satisfaction of any withholding
tax obligations that arise in connection with the Plan. The Company shall not be
required to issue any Common Shares or make any cash payment under the Plan
until such obligations are satisfied.

         16.2 SHARE WITHHOLDING. The Committee may permit a Participant to
satisfy all or part of his or her withholding or income tax obligations by
having the Company withhold all or a portion of any Common Shares that otherwise
would be issued to him or her or by surrendering all or a portion of any Common
Shares that he or she previously acquired. Such Common Shares shall be valued at
their Fair Market Value on the date when taxes otherwise would be withheld in
cash.

ARTICLE 17.  FUTURE OF THE PLAN.

         17.1 TERM OF THE PLAN. The Plan, as set forth herein, shall become
effective as of November 1, 2000. The Plan shall remain in effect until it is
terminated under Section 17.2, except that no ISOs shall be granted on or after
the 10th anniversary of the later of (a) the date when the Board adopted the
Plan or (b) the date when the Board adopted the most recent increase in the
number of Common Shares available under Article 3 which was approved by the
Company's stockholders.

         17.2 AMENDMENT OR TERMINATION. The Board may at any time amend, alter,
suspend or terminate the Plan for any reason.


<PAGE>

         17.3 STOCKHOLDER APPROVAL. The Company shall obtain stockholder
approval of any Plan amendment to the extent required by applicable law, rule or
regulation, including the requirements of any exchange or quotation system on
which the Common Shares are listed or quoted. Such stockholder approval, if
required shall be obtained in such a manner and to such a degree as is required
by the applicable laws, rules or regulations.

         17.4 EFFECT OF AMENDMENT OR TERMINATION. No amendment, alteration,
suspension or termination of the Plan shall materially impair the rights of any
Optionee, unless mutually agreed otherwise between the Optionee and the Board,
which agreement must be in writing and signed by the Optionee and the Company.
For purposes of the Plan, any amendment, alteration, suspension or termination
that is required to enable an Option designated as an Incentive Stock Option to
qualify as a Nonqualified Stock Option or is necessary to comply with any
applicable laws or government regulations, shall not be considered to materially
impair any rights of the Optionee. For purposes of the Plan, any action of the
Board or the Committee that alters or affects the tax treatment of any Award
shall not be considered to materially impair any rights of the respective
Participant.

ARTICLE 18.  LIMITATION ON PARACHUTE PAYMENTS.

         18.1 SCOPE OF LIMITATION. This Article 18 shall apply to an Award
unless the Committee, at the time of making an Award under the Plan or at any
time thereafter, specifies in writing that such Award shall not be subject to
this Article 18. If this Article 18 applies to an Award, it shall supersede any
contrary provision of the Plan or of any Award granted under the Plan.

         18.2 BASIC RULE. In the event that the independent auditors most
recently selected by the Board (the "Auditors") determine that any payment or
transfer by the Company under the Plan to or for the benefit of a Participant (a
"Payment") would be nondeductible by the Company for federal income tax purposes
because of the provisions concerning "excess parachute payments" in Section 280G
of the Code, then the aggregate present value of all Payments shall be reduced
(but not below zero) to the Reduced Amount. For purposes of this Article 18, the
"Reduced Amount" shall be the amount, expressed as a present value, which
maximizes the aggregate present value of the Payments without causing any
Payment to be nondeductible by the Company because of Section 280G of the Code.

         18.3 REDUCTION OF PAYMENTS. If the Auditors determine that any Payment
would be nondeductible by the Company because of Section 280G of the Code, then
the Company shall promptly give the Participant notice to that effect and a copy
of the detailed calculation thereof and of the Reduced Amount, and the
Participant may then elect, in his or her sole discretion, which and how much of
the Payments shall be eliminated or reduced (as long as after such election the
aggregate present value of the Payments equals the Reduced Amount) and shall
advise the Company in writing of his or her election within 10 days of receipt
of notice. If no such election is made by the Participant within such 10-day
period, then the Company may elect which and how much of the Payments shall be
eliminated or reduced (as long as after such election the aggregate present
value of the Payments equals the Reduced Amount) and shall


<PAGE>


notify the Participant promptly of such election. For purposes of this Article
18, present value shall be determined in accordance with Section 280G(d)(4) of
the Code. All determinations made by the Auditors under this Article 18 shall be
binding upon the Company and the Participant and shall be made within 60 days of
the date when a Payment becomes payable or transferable. As promptly as
practicable following such determination and the elections hereunder, the
Company shall pay or transfer to or for the benefit of the Participant such
amounts as are then due to him or her under the Plan and shall promptly pay or
transfer to or for the benefit of the Participant in the future such amounts as
become due to him or her under the Plan.

         18.4 OVERPAYMENTS AND UNDERPAYMENTS. As a result of uncertainty in the
application of Section 280G of the Code at the time of an initial determination
by the Auditors hereunder, it is possible that Payments will have been made by
the Company that should not have been made (an "Overpayment") or that additional
Payments that will not have been made by the Company could have been made (an
"Underpayment"), consistent in each case with the calculation of the Reduced
Amount hereunder. In the event that the Auditors, based upon the assertion of a
deficiency by the Internal Revenue Service against the Company or the
Participant that the Auditors believe has a high probability of success,
determine that an Overpayment has been made, such Overpayment shall be treated
for all purposes as a loan to the Participant which he or she shall repay to the
Company, together with interest at the applicable federal rate provided in
Section 7872(f)(2) of the Code; provided, however, that no amount shall be
payable by the Participant to the Company if and to the extent that such payment
would not reduce the amount subject to taxation under Section 4999 of the Code.
In the event that the Auditors determine that an Underpayment has occurred, such
Underpayment shall promptly be paid or transferred by the Company to or for the
benefit of the Participant, together with interest at the applicable federal
rate provided in Section 7872(f)(2) of the Code.

         18.5 RELATED CORPORATIONS. For purposes of this Article 18, the term
"Company" shall include affiliated corporations to the extent determined by the
Auditors in accordance with Section 280G(d)(5) of the Code.

ARTICLE 19.  INDEMNIFICATION.

         In addition to such other rights of indemnification as they may be
entitled as members of the Board or officers or employees of the Company and any
Parent or Subsidiary or as a matter of law or otherwise, members of the Board
and any officers or employees of the Company and any Parent or Subsidiary to
whom authority to act for the Board is delegated shall be indemnified and held
harmless, to the fullest extent permissible under applicable law, by the Company
against all loss, expense, liability and cost, including, without limitation,
reasonable attorneys' fees, incurred in connection with the defense of any
action, suit or proceeding, or in connection with any appeal therein, to which
they or any of them may be a party by reason of any action taken or failure to
act under or in connection with the Plan, or any right granted hereunder, and
against all amounts paid by them in settlement thereof (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 action, suit or proceeding,
except in relation to matters as to which it shall be adjudged in such action,
suit or proceeding that such person is liable for bad faith or intentional
misconduct in


<PAGE>

duties; provided, however, that within sixty (60) days after the institution of
such action, suit or proceeding, such person shall offer to the Company, in
writing, the opportunity at its own expense to handle and defend the same before
they undertake to handle or defend it on their own behalf.

         It is the Company's intention that all expenses incurred in connection
with the administration of the Plan shall be borne by the Company rather than
any member of the Board.

ARTICLE 20.  PROVISION OF INFORMATION.

         Each Participant will receive a copy of the Plan. At least annually, a
copy of the Company's annual financial statements for the just-completed fiscal
year shall be made available to each Participant and purchaser of Common Shares
upon exercise of an Award, subject, at the Company's sole discretion, to the
requirement that such Participant or purchaser, as applicable, execute a
confidentiality agreement in form and substance satisfactory to the Company. The
Company shall not be required to provide such information to key employees whose
duties in connection with the Company assure them access to equivalent
information.

ARTICLE 21.  ADMINISTRATION.

         21.1 COMMITTEE COMPOSITION. The Plan shall be administered by the Board
of Directors unless and until the Board delegates administration to a Committee,
as provided herein. The Board may delegate administration of the Plan to a
Committee composed of not fewer than two (2) members of the Board. If
administration is delegated to a Committee, the Committee shall have, in
connection with the administration of the Plan, the powers theretofore possessed
by the Board (and references in this Plan to the Board shall thereafter be to
the Committee), subject, however, to such decisions, not inconsistent with the
provisions of the Plan, as may be made from time to time by the Board. The Board
may abolish the Committee at any time and revest in the Board the administration
of the Plan. In addition, the composition of the Committee shall satisfy:

         a. Such requirements as the Securities and Exchange Commission may
establish for administrators acting under plans intended to qualify for
exemption under Rule 16b-3 (or its successor) under the Exchange Act; and

         b. Such requirements as the Internal Revenue Service may establish for
outside directors acting under plans intended to qualify for exemption under
section 162(m)(4)(C) of the Code.

In the absence of a Committee, all references in this Plan to the Committee
shall mean and refer to the Board.

         21.2 POWERS OF THE BOARD. Subject to the provisions of the Plan, and,
subject to the duties delegated by the Board to a Committee, the Board shall
have plenary authority, in its discretion:



<PAGE>


         a. to determine the Fair Market Value of the Common Stock, in
accordance with Section 2 of the Plan;

         b. to select the Employees, Consultants and Outside Directors to whom
Awards may be granted hereunder;

         c. to determine whether and to what extent Awards or any combination
thereof are granted hereunder;

         d. to determine the number of Common Shares to be covered by each Award
granted hereunder;

         e. to approve forms of agreement for use under the Plan;

         f. to determine the terms and conditions, not inconsistent with the
terms of the Plan, of any Award granted hereunder. Such terms and conditions
include, but are not limited to, the exercise price, the time or times when
Awards 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 Awards or the Common Shares relating thereto, based
in each case on such factors as the Board, in its sole discretion, shall
determine;

         g. to construe and interpret the terms of the Plan;

         h. to prescribe, amend and rescind rules and regulations relating to
the Plan;

         i. to determine whether and under what circumstances an Award may be
settled in cash instead of Common Shares or Common Shares instead of cash;

         j. to reduce the exercise price of any Award;

         k. to modify or amend each Award (subject to Section 17 of the Plan);

         l. to authorize any person to execute on behalf of the Company any
instrument required to effect the grant of an Award previously granted by the
Board;

         m. to determine the terms and restrictions applicable to Awards and any
Restricted Stock; and

         n. to make all other determinations deemed necessary or advisable for
administering the Plan.

The Board's determination on the foregoing matters and matters incidental
thereto shall be conclusive. In exercising such authority, the Board need not
treat all Awards in the same manner.


<PAGE>

         21.3     COMMITTEE FOR NON-OFFICER GRANTS. The Board may also appoint a
secondary committee of the Board, which shall be composed of one or more
directors of the Company who need not satisfy the requirements of Section 21.1.
Such secondary committee may administer the Plan with respect to Employees and
Consultants who are not considered officers or directors of the Company under
section 16 of the Exchange Act, may grant Awards under the Plan to such
Employees and Consultants and may determine all features and conditions of such
Awards. Within the limitations of this Section 21.3, any reference in the Plan
to the Committee shall include such secondary committee.

ARTICLE 22.  EXECUTION.

         To record the adoption of the Plan by the Board, the Company has caused
its duly authorized officer to execute this document in the name of the Company.

         Advanced Biotherapy, Inc.

         By:  /s/ Paul J. Marangos
                  Chief Executive Officer



<PAGE>

                            ADVANCED BIOTHERAPY, INC.
                       2000 OMNIBUS EQUITY INCENTIVE PLAN

                                 NOTICE OF GRANT

         Unless otherwise defined herein, the terms defined in the 2000 Omnibus
Equity Incentive Plan (the "Plan") shall have the same defined meanings in this
Notice of Grant.

                                                        Name
                                                       Address

         You have been granted an option to purchase Common Stock of the
Company, subject to the terms and conditions of the Plan and this Stock Option
Agreement, as follows:

         Grant Number                                XXX

         Date of Grant                               _____________ 2000

         Vesting Commencement Date  ______________ 20xx

         Exercise Price per Share           $xx.xx

         Total Number of Shares Granted     xxx

         Total Exercise Price               $xxxxxxxxx

         Type of Option:                    __________ Incentive Stock Option

                                            __________ Nonstatutory Stock Option

         Term/Expiration Date:              ___________, 20xx

         VESTING SCHEDULE:
         ----------------

         This Option may be exercised, in whole or in part, in accordance with
the following schedule:

  NUMBER OF SHARES (INSTALLMENT)            DATE OF EARLIEST EXERCISE (VESTING)
  ------------------------------            -----------------------------------







<PAGE>

TERMINATION PERIOD:

         This Option may be exercised for six (6) months after termination of
employment or consulting relationship as a result of the death or Disability of
Optionee, but in no event later than the Term/Expiration Date as provided above.
Upon termination of employment for any reason other than death or Disability,
this Option may be exercised for three (3) months after termination of
employment or consulting relationship, but in no event later than the
Term/Expiration Date as provided above. Notwithstanding the foregoing, if
Optionee shall be terminated "for cause" (as defined in Section 6 of the Option
Agreement), this Option shall terminate automatically on the termination date.

ADDITIONAL TERMS/ACKNOWLEDGMENTS:

         The Optionee acknowledges receipt of, and understands and agrees to,
this Notice of Grant, the Stock Option Agreement and the Plan. Optionee further
acknowledges that as of the date of grant set forth above, this Notice of Grant,
the Stock Option Agreement and the Plan set forth the entire understanding
between the Optionee and the Company regarding the acquisition of stock in the
Company and supersede all prior oral and written agreements on that subject.

ADVANCED BIOTHERAPY, INC.,               OPTIONEE:
a Delaware corporation

By:
     -------------------------------    -------------------------------------

Title:                                   Printed Name:
        ----------------------------                  -----------------------

Date:                                    Date Signed:
       -----------------------------                  ------------------------




Attachment I:     Stock Option Agreement
Attachment II:    2000 Omnibus Equity Incentive Plan


