<SUBMISSION>
<ACCESSION-NUMBER>0000950148-01-502006
<TYPE>PRE 14A
<PUBLIC-DOCUMENT-COUNT>1
<PERIOD>20011206
<FILING-DATE>20011018
<FILER>
<COMPANY-DATA>
<CONFORMED-NAME>ADVANCED BIOTHERAPY INC
<CIK>0000791833
<ASSIGNED-SIC>8731
<STATE-OF-INCORPORATION>NV
<FISCAL-YEAR-END>1231
</COMPANY-DATA>
<FILING-VALUES>
<FORM-TYPE>PRE 14A
<ACT>34
<FILE-NUMBER>000-26323
<FILM-NUMBER>1761840
</FILING-VALUES>
<BUSINESS-ADDRESS>
<STREET1>6355 TOPANGA CANYON BLVD
<STREET2>SUITE 510
<CITY>WOODLAND HILLS
<STATE>CA
<ZIP>91367
<PHONE>8188833956
</BUSINESS-ADDRESS>
<MAIL-ADDRESS>
<STREET1>6355 TOPANGA CANYON BLVD
<STREET2>SUITE 510
<CITY>WOODLAND HILLS
<STATE>CA
<ZIP>91367
</MAIL-ADDRESS>
<FORMER-COMPANY>
<FORMER-CONFORMED-NAME>ADVANCED BIOTHERAPY CONCEPTS INC
<DATE-CHANGED>19990524
</FORMER-COMPANY>
</FILER>
<DOCUMENT>
<TYPE>PRE 14A
<SEQUENCE>1
<FILENAME>v76220ppre14a.htm
<DESCRIPTION>ADVANCED BIOTHERAPY, INC. PRE 14A
<TEXT>
<HTML>
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<TITLE>ADVANCED BIOTHERAPY, INC.</TITLE>
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<H5 align="left" style="page-break-before:always"><A HREF="#toc">Table of Contents</A></H5><P>

<P align="center"><FONT size="2"><B>SCHEDULE 14A INFORMATION</B></FONT>

<P><FONT size="2">Proxy Statement Pursuant to Section&nbsp;14(a) of the Securities Exchange Act of 1934</FONT>

<P><FONT size="2">Filed by the Registrant &#091;X&#093;</FONT>
<DIV><FONT size="2">Filed by a Party other than the Registrant &#091;&nbsp;&nbsp;&nbsp;&#093;</FONT></DIV>

<P><FONT size="2">Check the appropriate box:</FONT>

<CENTER>
<TABLE cellspacing="0" border="0" cellpadding="0" width="100%">
<TR valign="bottom">
        <TD width="1%">&nbsp;</TD>
        <TD width="4%">&nbsp;</TD>
        <TD width="95%">&nbsp;</TD>
</TR>
<TR valign="bottom">
        <TD valign="top"><FONT size="2">&#091;X&#093;</FONT></TD>
        <TD><FONT size="2">&nbsp;</FONT></TD>
        <TD align="left" valign="top"><FONT size="2">
Preliminary Proxy Statement</FONT></TD>
</TR>

<TR valign="bottom">
        <TD valign="top"><FONT size="2">&#091;&nbsp;&nbsp;&nbsp;&#093;</FONT></TD>
        <TD><FONT size="2">&nbsp;</FONT></TD>
        <TD align="left" valign="top"><FONT size="2">
Confidential, for Use of the Commission Only (as permitted by Rule&nbsp;14a-6(e)(2))</FONT></TD>
</TR>
<TR><TD><TR><TD><TR><TD><TR><TD>
<TR><TD><TR><TD><TR><TD><TR><TD>
<TR><TD><TR><TD><TR><TD><TR><TD>

<TR valign="bottom">
        <TD valign="top"><FONT size="2">&#091;&nbsp;&nbsp;&nbsp;&#093;</FONT></TD>
        <TD><FONT size="2">&nbsp;</FONT></TD>
        <TD align="left" valign="top"><FONT size="2">
Definitive Proxy Statement</FONT></TD>
</TR>

<TR valign="bottom">
        <TD valign="top"><FONT size="2">&#091;&nbsp;&nbsp;&nbsp;&#093;</FONT></TD>
        <TD><FONT size="2">&nbsp;</FONT></TD>
        <TD align="left" valign="top"><FONT size="2">
Definitive Additional Materials</FONT></TD>
</TR>

<TR valign="bottom">
        <TD valign="top"><FONT size="2">&#091;&nbsp;&nbsp;&nbsp;&#093;</FONT></TD>
        <TD><FONT size="2">&nbsp;</FONT></TD>
        <TD align="left" valign="top"><FONT size="2">
Soliciting Material Pursuant to Section&nbsp;240.14a-12</FONT></TD>
</TR>
</TABLE>
</CENTER>
<P align="center"><FONT size="2"><B>ADVANCED BIOTHERAPY, INC.</B><BR>
(Name of Registrant as Specified in Its Charter)</FONT>

<HR size="1" noshade>

<DIV align="center"><FONT size="2">(Name of Person(s) Filing Proxy Statement if Other than the Registrant)</FONT></DIV>


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        <TD width="1%">&nbsp;</TD>
        <TD width="4%">&nbsp;</TD>
        <TD width="95%">&nbsp;</TD>
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<TR valign="bottom">
        <TD COLSPAN="3"><FONT size="2">Payment of Filing Fee (Check the appropriate box):</FONT></TD>
</TR>
<TR valign="bottom">
        <TD valign="top"><FONT size="2">&#091;X&#093;</FONT></TD>
        <TD><FONT size="2">&nbsp;</FONT></TD>
        <TD align="left" valign="top"><FONT size="2">
No fee required.</FONT></TD>
</TR>
<TR><TD><TR><TD><TR><TD><TR><TD>
<TR><TD><TR><TD><TR><TD><TR><TD>
<TR><TD><TR><TD><TR><TD><TR><TD>

<TR valign="bottom">
        <TD valign="top"><FONT size="2">&#091;&nbsp;&nbsp;&nbsp;&#093;</FONT></TD>
        <TD><FONT size="2">&nbsp;</FONT></TD>
        <TD align="left" valign="top"><FONT size="2">
Fee computed on table below per Exchange Act Rules&nbsp;14a-6(i)(4) and 0-11.</FONT></TD>
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        <TD><FONT size="2">&nbsp;</FONT></TD>
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1) Title of each class of securities to which transaction applies:</FONT></TD>
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2) Aggregate number of securities to which transaction applies:</FONT></TD>
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        <TD align="left" valign="top"><FONT size="2">
3) Per unit price or other underlying value of transaction computed
pursuant to Exchange Act Rule 0-11 (set forth the amount on which the
filing fee is calculated and state how it was determined):</FONT></TD>
</TR>
<TR><TD><TR><TD><TR><TD><TR><TD>
<TR><TD><TR><TD><TR><TD><TR><TD>
<TR><TD><TR><TD><TR><TD><TR><TD>
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        <TD valign="top"><FONT size="2">&nbsp;</FONT></TD>
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<TR><TD><TR><TD><TR><TD><TR><TD>
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        <TD valign="top"><FONT size="2">&nbsp;</FONT></TD>
        <TD><FONT size="2">&nbsp;</FONT></TD>
        <TD align="left" valign="top"><FONT size="2">
4) Proposed maximum aggregate value of transaction:</FONT></TD>
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<TR><TD><TR><TD><TR><TD><TR><TD>
<TR><TD><TR><TD><TR><TD><TR><TD>
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        <TD valign="top"><FONT size="2">&nbsp;</FONT></TD>
        <TD><FONT size="2">&nbsp;</FONT></TD>
        <TD align="left" valign="top"><FONT size="2">
5) Total fee paid:</FONT></TD>
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<TR><TD><TR><TD><TR><TD><TR><TD>
<TR><TD><TR><TD><TR><TD><TR><TD>
<TR><TD><TR><TD><TR><TD><TR><TD>
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<HR size="1" noshade></FONT></TD>
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<TR><TD><TR><TD><TR><TD><TR><TD>
<TR><TD><TR><TD><TR><TD><TR><TD>
<TR><TD><TR><TD><TR><TD><TR><TD>
<TR valign="bottom">
        <TD valign="top"><FONT size="2">&#091;&nbsp;&nbsp;&nbsp;&#093;</FONT></TD>
        <TD><FONT size="2">&nbsp;</FONT></TD>
        <TD align="left" valign="top"><FONT size="2">
Fee paid previously with preliminary materials.</FONT></TD>
</TR>

<TR><TD><TR><TD><TR><TD><TR><TD>
<TR><TD><TR><TD><TR><TD><TR><TD>
<TR><TD><TR><TD><TR><TD><TR><TD>
<TR valign="bottom">
        <TD valign="top"><FONT size="2">&#091;&nbsp;&nbsp;&nbsp;&#093;</FONT></TD>
        <TD><FONT size="2">&nbsp;</FONT></TD>
        <TD align="left" valign="top"><FONT size="2">
Check box if any part of the fee is offset as provided by Exchange
Act Rule&nbsp;0-11(a)(2) and identify the filing for which the offsetting
fee was paid previously. Identify the previous filing by registration
statement number, or the Form or Schedule and the date of its filing.</FONT></TD>
</TR>

<TR><TD><TR><TD><TR><TD><TR><TD>
<TR><TD><TR><TD><TR><TD><TR><TD>
<TR><TD><TR><TD><TR><TD><TR><TD>
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        <TD valign="top"><FONT size="2">&nbsp;</FONT></TD>
        <TD><FONT size="2">&nbsp;</FONT></TD>
        <TD align="left" valign="top"><FONT size="2">
1) Amount Previously Paid:</FONT></TD>
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<TR><TD><TR><TD><TR><TD><TR><TD>
<TR><TD><TR><TD><TR><TD><TR><TD>
<TR><TD><TR><TD><TR><TD><TR><TD>
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        <TD valign="top"><FONT size="2">&nbsp;</FONT></TD>
        <TD><FONT size="2">&nbsp;</FONT></TD>
        <TD align="left" valign="top"><FONT size="2">
2) Form, Schedule or Registration Statement No.:</FONT></TD>
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        <TD valign="top"><FONT size="2">&nbsp;</FONT></TD>
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3) Filing Party:</FONT></TD>
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        <TD valign="top"><FONT size="2">&nbsp;</FONT></TD>
        <TD><FONT size="2">&nbsp;</FONT></TD>
        <TD align="left" valign="top"><FONT size="2">
4) Date Filed:</FONT></TD>
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        <TD align="left" valign="top"><FONT size="2">
<HR size="1" noshade></FONT></TD>
</TR>
</TABLE>
</CENTER>
<P align="center"><FONT size="2">&nbsp;
</FONT>

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<!-- TOC -->
<A name="toc"><DIV align="CENTER"><U><B>TABLE OF CONTENTS</B></U></DIV></A>

<P><CENTER>
<TABLE border="0" width="90%" cellpadding="0" cellspacing="0">
<TR>
	<TD width="3%"></TD>
	<TD width="3%"></TD>
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	<TD width="3%"></TD>
	<TD width="3%"></TD>
	<TD width="76%"></TD>
</TR>
<TR><TD colspan="9"><A HREF="#000">OUTSTANDING SECURITIES AND VOTING RIGHTS</A></TD></TR>
<TR><TD colspan="9"><A HREF="#001">VOTING SECURITIES AND PRINCIPAL HOLDERS THEREOF</A></TD></TR>
<TR><TD colspan="9"><A HREF="#002">COMPENSATION OF DIRECTORS AND EXECUTIVE OFFICERS</A></TD></TR>
<TR><TD colspan="9"><A HREF="#003">OTHER MATTERS</A></TD></TR>
<TR><TD colspan="9"><A HREF="#004">AVAILABLE INFORMATION</A></TD></TR>
<TR><TD colspan="9"><A HREF="#005">APPENDIX A</A></TD></TR>
<TR><TD colspan="9"><A HREF="#006">APPENDIX B</A></TD></TR>
</TABLE>
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<P align="center"><FONT size="2"><B>ADVANCED BIOTHERAPY, INC.<BR>
6355 TOPANGA CANYON BOULEVARD, SUITE 510<BR>
WOODLAND HILLS, CALIFORNIA 91367</B></FONT>

<P align="center"><FONT size="2"><B>NOTICE OF ANNUAL MEETING OF STOCKHOLDERS<BR>
TO BE HELD ON DECEMBER 13, 2001</B></FONT>

<P><FONT size="2"><B>TO THE STOCKHOLDERS OF ADVANCED BIOTHERAPY, INC.:</B>
</FONT>
<P><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;The Annual Meeting of Stockholders of Advanced Biotherapy, Inc., a
Delaware corporation (the &#147;Company&#148;), will be held on
Thursday, December&nbsp;13,
2001, at 2:00&nbsp;p.m. local time at the Woodland Hills Marriott, 21850
Oxnard Street, Woodland Hills, California 91367, for the following purposes:
</FONT>
<P><FONT size="2">1.&nbsp;To elect eight (8)&nbsp;directors to hold office until the next Annual Meeting of
Stockholders and until their respective successors are elected and qualified,
or until death, resignation or removal.
</FONT>
<P><FONT size="2">2.&nbsp;To approve the adoption of the Company&#146;s 2000 Omnibus Equity Incentive Plan.
</FONT>
<P><FONT size="2">3.&nbsp;To approve a reverse stock split in a range
not to exceed a one-for-ten
reverse split, i.e., at a ratio of at least 1:10, provided such reverse stock
split <U>shall not be adopted unless</U> a Significant Transaction
shall have occurred and the Board of Directors makes a determination
within three (3) years after the Annual Meeting that such stock split is in the best
interest of the Company&#146;s stockholders, which transaction and
determination <U>have not occurred.</U>
</FONT>
<P><FONT size="2">4.&nbsp;To transact such other business as may properly come before the meeting or
any adjournment thereof.
</FONT>
<P><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;The foregoing items of business are more fully described in the Proxy
Statement accompanying this Notice.
</FONT>
<P><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;The Board of Directors has fixed the close of business on October&nbsp;15,
2001, as the record date for the determination of stockholders entitled to
notice of and to vote at the Annual Meeting and at any adjournment or
postponement thereof. Only stockholders of record as of the close of business
on such date are entitled to notice of and to vote in person or by proxy at the
Annual Meeting.
</FONT>
<P>
<TABLE width="100%" border="0" cellpadding="0" cellspacing="0">
<TR valign="top">
        <TD width="50%"><FONT size="2">&nbsp;</FONT></TD>
        <TD width="50%"><FONT size="2">Sincerely,<BR>
<I>Edmond Buccellato</I><BR>
Edmond Buccellato<BR>
President and Chief Executive Officer</FONT></TD>
</TR>
</TABLE>
<P><FONT size="2">October&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;, 2001
</FONT>
<P><FONT size="2">All stockholders are invited to attend the Annual Meeting in person, but even
if you expect to be present at the Annual Meeting, sign, date and return the
enclosed proxy
card as promptly as possible in the postage-paid envelope provided. Returning
a signed proxy will not prevent you from attending the Meeting and voting in
person if you so desire.
</FONT>
<P align="center"><FONT size="2">Page 1 of 24
</FONT>

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<P align="center"><FONT size="2"><B>ADVANCED BIOTHERAPY, INC.</B></FONT>

<P align="center"><FONT size="2"><B>PROXY STATEMENT<BR>
October ___, 2001</B></FONT>

<P align="left"><FONT size="2"><B>General</B></FONT>

<P><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;The enclosed proxy is solicited by the Board of Directors of Advanced
Biotherapy, Inc., a Delaware corporation (the &#147;Company&#148;), for use at the Annual
Meeting of Stockholders to be held on Thursday, December&nbsp;13,
2001, at 2:00&nbsp;p.m. local
time (the &#147;Annual Meeting&#148;), and at any adjournment or postponement thereof,
for the purposes set forth herein and in the accompanying Notice of Annual
Meeting. The Annual Meeting will be held at the Woodland Hills Marriott, 21850
Oxnard Street, Woodland Hills, California 91367. This Proxy Statement and
accompanying proxy card are being mailed to the stockholders of the Company, on
or about October &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;, 2001.
</FONT>
<!-- link1 "OUTSTANDING SECURITIES AND VOTING RIGHTS" -->
<DIV align="left"><A NAME="000"></A></DIV>
<P align="center"><FONT size="2"><B>OUTSTANDING SECURITIES AND VOTING RIGHTS</B></FONT>

<P><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;The only class of voting securities of the Company is its common stock,
par value $.001 per share (the &#147;Common Stock&#148;). Only holders of record of the
Company&#146;s Common Stock at the close of business on October&nbsp;15, 2001 (the
&#147;Record Date&#148;), will be entitled to notice of, and to vote at, the Annual
Meeting. On the Record Date, the Company had 39,848,265 shares of Common Stock
outstanding. Each share of Common Stock outstanding as of the Record Date is
entitled to one vote at the Annual Meeting.
</FONT>
<P><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;As of the Record Date, there were approximately 3,500 beneficial owners,
according to information provided by American Stock Transfer &#038; Trust Co., the
stock transfer agent of the Company.
</FONT>
<P><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;The nominees for election to the Board of Directors who receive the
greatest number of votes cast for the election of directors by the shares
present, in person or by proxy, shall be elected directors. Holders of Common
Stock are not allowed to cumulate their votes in the election of Directors,
and, therefore, the holders of more than 50% of the shares of Common Stock,
could, if they chose to do so, elect all of the directors of the Company.
Proposals 2 and 3 require the affirmative vote of at least a majority of the
shares of Common Stock present, in person or by proxy, at the Annual Meeting
and entitled to vote at the Meeting.
</FONT>
<P><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;A majority of the outstanding shares of Common Stock present, in person or
by proxy, constitutes a quorum for the transaction of business at the Annual
Meeting. Abstentions and broker nonvotes are counted as present for purposes
of determining the presence of a quorum at the Annual Meeting. Abstentions
will be counted toward the
</FONT>
<P align="center"><FONT size="2">Page 2 of 24
</FONT>

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<P><FONT size="2">tabulations of votes cast on proposals presented to the stockholders and will
have the same effect as negative votes, whereas broker nonvotes will not be
counted for purposes of determining whether a proposal has been approved. In
the election of directors, abstentions or broker nonvotes have no effect on
the outcome. Broker nonvotes occur when a person holding shares through a bank
or brokerage account does not provide instructions as to how his or her shares
should be voted and the broker does not exercise discretion to vote those
shares.
</FONT>
<P align="left"><FONT size="2"><B>Proxies</B></FONT>

<P><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Shares for which proxy cards are properly executed and returned will be
voted at the Annual Meeting in accordance with the instructions specified
thereon. If the proxy does not specify how the shares represented thereby are
to be voted, the proxy will be voted &#147;FOR&#148; the election of each of the nominees
to the Board of Directors, unless the authority to vote for the election of
such director is withheld and, if no contrary instructions are given, the proxy
will be voted &#147;FOR&#148; the approval of Proposals 2 and 3 described in the
accompanying Notice and Proxy Statement. You may revoke or change your Proxy
at any time before the Annual Meeting by filing with the Secretary of the
Company at the Company&#146;s offices at 6355 Topanga Canyon Boulevard, Suite&nbsp;510,
Woodland Hills, California 91367, a notice of revocation or another signed
proxy with a later date. You may also revoke your proxy by attending the
Annual Meeting and voting in person.
</FONT>
<P align="left"><FONT size="2"><B>Solicitation</B></FONT>

<P><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;The Company will bear the entire cost of solicitation of proxies including
preparation, assembly, printing and mailing of this proxy statement, the proxy
card and any additional information furnished to stockholders. Copies of
solicitation materials will be furnished to banks, brokerage houses,
fiduciaries and custodians holding in their names shares of Common Stock
beneficially owned by others to forward to such beneficial owners. The Company
may reimburse persons representing beneficial owners of Common Stock for their
costs of forwarding solicitation materials to such beneficial owners. Original
solicitation of proxies by mail may be supplemented by telephone, telecopier or
personal solicitation by directors, officers or other employees of the Company.
No additional compensation will be paid to directors, officers or other
employees for such services.
</FONT>
<P align="left"><FONT size="2"><B>Deadline for Receipt of Stockholder Proposals</B></FONT>

<P><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Proposals which stockholders wish to be considered for inclusion in the
proxy statement and proxy card for the Company&#146;s 2002 Annual Meeting must be
received by the Secretary of the Company no later than March&nbsp;8, 2002, and must
comply with the requirements of Rule&nbsp;14a-8 under the Securities Exchange Act of
1934, as amended.
</FONT>
<P align="center"><FONT size="2">Page 3 of 24
</FONT>

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<!-- link1 "VOTING SECURITIES AND PRINCIPAL HOLDERS THEREOF" -->
<DIV align="left"><A NAME="001"></A></DIV>
<P align="center"><FONT size="2"><B>VOTING SECURITIES AND PRINCIPAL HOLDERS THEREOF</B></FONT>

<P><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;The following table sets forth information known to the Company with
respect to the beneficial ownership of the Company&#146;s Common Stock as of
September&nbsp;30, 2001, by (i)&nbsp;all persons who are beneficial owners of five
percent (5%) or more of the Company&#146;s Common Stock, (ii)&nbsp;each director and
nominee for director, (iii)&nbsp;the executive officers of the Company; and (iv)&nbsp;all
current directors and executive officers of the Company as a group. Except as
otherwise indicated, the Company believes that the beneficial owners of the
Common Stock listed below, based on information furnished by such owners, have
sole vesting and investment power with respect to such shares.
</FONT>
<CENTER>
<TABLE cellspacing="0" border="0" cellpadding="0" width="100%">
<TR valign="bottom">
        <TD width="40%">&nbsp;</TD>
        <TD width="5%">&nbsp;</TD>
        <TD width="8%">&nbsp;</TD>
        <TD width="1%">&nbsp;</TD>
        <TD width="9%">&nbsp;</TD>
        <TD width="5%">&nbsp;</TD>
        <TD width="24%">&nbsp;</TD>
        <TD width="5%">&nbsp;</TD>
        <TD width="1%">&nbsp;</TD>
        <TD width="1%">&nbsp;</TD>
        <TD width="1%">&nbsp;</TD>
</TR>
<TR valign="bottom">
        <TD><FONT size="1">&nbsp;</FONT></TD>
        <TD><FONT size="1">&nbsp;</FONT></TD>
        <TD nowrap align="center" colspan="3"><FONT size="1"><B>Number of Shares</B></FONT></TD>
        <TD><FONT size="1">&nbsp;</FONT></TD>
        <TD><FONT size="1">&nbsp;</FONT></TD>
        <TD><FONT size="1">&nbsp;</FONT></TD>
        <TD><FONT size="1">&nbsp;</FONT></TD>
        <TD><FONT size="1">&nbsp;</FONT></TD>
        <TD><FONT size="1">&nbsp;</FONT></TD>
</TR>
<TR valign="bottom">
        <TD><FONT size="1">&nbsp;</FONT></TD>
        <TD><FONT size="1">&nbsp;</FONT></TD>
        <TD nowrap align="center" colspan="3"><FONT size="1"><B>Including Options,</B></FONT></TD>
        <TD><FONT size="1">&nbsp;</FONT></TD>
        <TD><FONT size="1">&nbsp;</FONT></TD>
        <TD><FONT size="1">&nbsp;</FONT></TD>
        <TD><FONT size="1">&nbsp;</FONT></TD>
        <TD><FONT size="1">&nbsp;</FONT></TD>
        <TD><FONT size="1">&nbsp;</FONT></TD>
</TR>
<TR valign="bottom">
        <TD><FONT size="1">&nbsp;</FONT></TD>
        <TD><FONT size="1">&nbsp;</FONT></TD>
        <TD nowrap align="center" colspan="3"><FONT size="1"><B>Warrants and</B></FONT></TD>
        <TD><FONT size="1">&nbsp;</FONT></TD>
        <TD><FONT size="1">&nbsp;</FONT></TD>
        <TD><FONT size="1">&nbsp;</FONT></TD>
        <TD nowrap align="center" colspan="3"><FONT size="1"><B>Percentage</B></FONT></TD>
</TR>
<TR valign="bottom">
        <TD><FONT size="1">&nbsp;</FONT></TD>
        <TD><FONT size="1">&nbsp;</FONT></TD>
        <TD nowrap align="center" colspan="3"><FONT size="1"><B>Convertible</B></FONT></TD>
        <TD><FONT size="1">&nbsp;</FONT></TD>
        <TD><FONT size="1">&nbsp;</FONT></TD>
        <TD><FONT size="1">&nbsp;</FONT></TD>
        <TD nowrap align="center" colspan="3"><FONT size="1"><B>of Shares</B></FONT></TD>
</TR>
<TR valign="bottom">
        <TD nowrap align="center"><FONT size="1"><B>Name and Address of Owner</B></FONT></TD>
        <TD><FONT size="1">&nbsp;</FONT></TD>
        <TD nowrap align="center" colspan="3"><FONT size="1"><B>Securities</B></FONT></TD>
        <TD><FONT size="1">&nbsp;</FONT></TD>
        <TD nowrap align="center"><FONT size="1"><B>Position at Company</B></FONT></TD>
        <TD><FONT size="1">&nbsp;</FONT></TD>
        <TD nowrap align="center" colspan="3"><FONT size="1"><B>(11)</B></FONT></TD>
</TR>
<TR valign="bottom">
        <TD nowrap align="center"><HR size="1" noshade></TD>
        <TD><FONT size="1">&nbsp;</FONT></TD>
        <TD colspan="3"><HR size="1" noshade></TD>
        <TD><FONT size="1">&nbsp;</FONT></TD>
        <TD nowrap align="center"><HR size="1" noshade></TD>
        <TD><FONT size="1">&nbsp;</FONT></TD>
        <TD colspan="3"><HR size="1" noshade></TD>
</TR>
<TR valign="bottom">
        <TD valign="top"><FONT size="2">Leonard Millstein<BR>
Ellen Millstein<BR>
1677 Calle Alta<BR>
La Jolla, CA 92037</FONT></TD>
        <TD><FONT size="2">&nbsp;</FONT></TD>
        <TD nowrap align="right" valign="top"><FONT size="2">&nbsp;</FONT></TD>
        <TD align="CENTER" valign="top"><FONT size="2">
5,200,159(1)
</FONT></TD>
        <TD valign="top"><FONT size="2">&nbsp;</FONT></TD>
        <TD><FONT size="2">&nbsp;</FONT></TD>
        <TD align="CENTER" valign="top"><FONT size="2">Director
</FONT></TD>
        <TD><FONT size="2">&nbsp;</FONT></TD>
        <TD nowrap align="right" valign="top"><FONT size="2">&nbsp;</FONT></TD>
        <TD align="right" valign="top"><FONT size="2">13.0</FONT></TD>
        <TD nowrap valign="top"><FONT size="2">%</FONT></TD>
</TR>
<TR><TD><TR><TD><TR><TD><TR><TD>
<TR><TD><TR><TD><TR><TD><TR><TD>

<TR valign="bottom">
        <TD valign="top"><FONT size="2">Boris V. Skurkovich, M.D.<BR>
18 Blaisdell Ave.<BR>
Pawtucket, RI 01860</FONT></TD>
        <TD><FONT size="2">&nbsp;</FONT></TD>
        <TD nowrap align="right" valign="top"><FONT size="2">&nbsp;</FONT></TD>
        <TD align="CENTER" valign="top" NOWRAP><FONT size="2">
5,177,270(2)
</FONT></TD>
        <TD valign="top"><FONT size="2">&nbsp;</FONT></TD>
        <TD><FONT size="2">&nbsp;</FONT></TD>
        <TD align="CENTER" valign="top"><FONT size="2">Director
</FONT></TD>
        <TD><FONT size="2">&nbsp;</FONT></TD>
        <TD nowrap align="right" valign="top"><FONT size="2">&nbsp;</FONT></TD>
        <TD align="right" valign="top"><FONT size="2">12.9</FONT></TD>
        <TD nowrap valign="top"><FONT size="2">%</FONT></TD>
</TR>
<TR><TD><TR><TD><TR><TD><TR><TD>
<TR><TD><TR><TD><TR><TD><TR><TD>

<TR valign="bottom">
        <TD valign="top"><FONT size="2">Gerard K. Cappello<BR>
1299 Ocean Avenue<BR>
Suite&nbsp;306<BR>
Santa Monica, CA 90401</FONT></TD>
        <TD><FONT size="2">&nbsp;</FONT></TD>
        <TD nowrap align="right" valign="top"><FONT size="2">&nbsp;</FONT></TD>
        <TD align="CENTER" valign="top"><FONT size="2">
2,765,660(3)
</FONT></TD>
        <TD valign="top"><FONT size="2">&nbsp;</FONT></TD>
        <TD><FONT size="2">&nbsp;</FONT></TD>
        <TD align="CENTER" valign="top"><FONT size="2">N/A
</FONT></TD>
        <TD><FONT size="2">&nbsp;</FONT></TD>
        <TD nowrap align="right" valign="top"><FONT size="2">&nbsp;</FONT></TD>
        <TD align="right" valign="top"><FONT size="2">6.5</FONT></TD>
        <TD nowrap valign="top"><FONT size="2">%</FONT></TD>
</TR>
<TR><TD><TR><TD><TR><TD><TR><TD>
<TR><TD><TR><TD><TR><TD><TR><TD>

<TR valign="bottom">
        <TD valign="top"><FONT size="2">Edmond F. Buccellato<BR>
6355 Topanga Canyon<BR>
Boulevard, Suite&nbsp;510<BR>
Woodland Hills, CA 91367</FONT></TD>
        <TD><FONT size="2">&nbsp;</FONT></TD>
        <TD nowrap align="right" valign="top"><FONT size="2">&nbsp;</FONT></TD>
        <TD align="CENTER" valign="top"><FONT size="2">
2,144,443(4)
</FONT></TD>
        <TD valign="top"><FONT size="2">&nbsp;</FONT></TD>
        <TD><FONT size="2">&nbsp;</FONT></TD>
        <TD align="CENTER" valign="top"><FONT size="2">President and Chief
Executive Officer,
Director
</FONT></TD>
        <TD><FONT size="2">&nbsp;</FONT></TD>
        <TD nowrap align="right" valign="top"><FONT size="2">&nbsp;</FONT></TD>
        <TD align="right" valign="top"><FONT size="2">5.3</FONT></TD>
        <TD nowrap valign="top"><FONT size="2">%</FONT></TD>
</TR>
<TR><TD><TR><TD><TR><TD><TR><TD>
<TR><TD><TR><TD><TR><TD><TR><TD>

<TR valign="bottom">
        <TD valign="top"><FONT size="2">Simon Skurkovich, M.D.<BR>
802 Rollins Avenue<BR>
Rockville, MD 20852</FONT></TD>
        <TD><FONT size="2">&nbsp;</FONT></TD>
        <TD nowrap align="right" valign="top"><FONT size="2">&nbsp;</FONT></TD>
        <TD align="CENTER" valign="top"><FONT size="2">
2,026,770(5)
</FONT></TD>
        <TD valign="top"><FONT size="2">&nbsp;</FONT></TD>
        <TD><FONT size="2">&nbsp;</FONT></TD>
        <TD align="CENTER" valign="top"><FONT size="2">Chairman Emeritus,
Director, and
Director of
Research and
Development
</FONT></TD>
        <TD><FONT size="2">&nbsp;</FONT></TD>
        <TD nowrap align="right" valign="top"><FONT size="2">&nbsp;</FONT></TD>
        <TD align="right" valign="top"><FONT size="2">5.0</FONT></TD>
        <TD nowrap valign="top"><FONT size="2">%</FONT></TD>
</TR>
<TR><TD><TR><TD><TR><TD><TR><TD>
<TR><TD><TR><TD><TR><TD><TR><TD>

<TR valign="bottom">
        <TD valign="top"><FONT size="2">Lawrence Loomis<BR>
9110 Red Branch Road<BR>
Columbia, MD 21045</FONT></TD>
        <TD><FONT size="2">&nbsp;</FONT></TD>
        <TD nowrap align="right" valign="top"><FONT size="2">&nbsp;</FONT></TD>
        <TD align="CENTER" valign="top"><FONT size="2">
1,610,000(6)
</FONT></TD>
        <TD valign="top"><FONT size="2">&nbsp;</FONT></TD>
        <TD><FONT size="2">&nbsp;</FONT></TD>
        <TD align="CENTER" valign="top"><FONT size="2">Director
</FONT></TD>
        <TD><FONT size="2">&nbsp;</FONT></TD>
        <TD nowrap align="right" valign="top"><FONT size="2">&nbsp;</FONT></TD>
        <TD align="right" valign="top"><FONT size="2">4.0</FONT></TD>
        <TD nowrap valign="top"><FONT size="2">%</FONT></TD>
</TR>
</TABLE>
</CENTER>
<P align="center"><FONT size="2">Page 4 of 24
</FONT>

<!-- PAGEBREAK -->
<P><HR noshade><P>
<H5 align="left" style="page-break-before:always"><A HREF="#toc">Table of Contents</A></H5><P>
<CENTER>
<TABLE cellspacing="0" border="0" cellpadding="0" width="100%">
<TR valign="bottom">
        <TD width="40%">&nbsp;</TD>
        <TD width="5%">&nbsp;</TD>
        <TD width="8%">&nbsp;</TD>
        <TD width="1%">&nbsp;</TD>
        <TD width="9%">&nbsp;</TD>
        <TD width="5%">&nbsp;</TD>
        <TD width="24%">&nbsp;</TD>
        <TD width="5%">&nbsp;</TD>
        <TD width="1%">&nbsp;</TD>
        <TD width="1%">&nbsp;</TD>
        <TD width="1%">&nbsp;</TD>
</TR>
<TR valign="bottom">
        <TD><FONT size="1">&nbsp;</FONT></TD>
        <TD><FONT size="1">&nbsp;</FONT></TD>
        <TD nowrap align="center" colspan="3"><FONT size="1"><B>Number of Shares</B></FONT></TD>
        <TD><FONT size="1">&nbsp;</FONT></TD>
        <TD><FONT size="1">&nbsp;</FONT></TD>
        <TD><FONT size="1">&nbsp;</FONT></TD>
        <TD><FONT size="1">&nbsp;</FONT></TD>
        <TD><FONT size="1">&nbsp;</FONT></TD>
        <TD><FONT size="1">&nbsp;</FONT></TD>
</TR>
<TR valign="bottom">
        <TD><FONT size="1">&nbsp;</FONT></TD>
        <TD><FONT size="1">&nbsp;</FONT></TD>
        <TD nowrap align="center" colspan="3"><FONT size="1"><B>Including Options,</B></FONT></TD>
        <TD><FONT size="1">&nbsp;</FONT></TD>
        <TD><FONT size="1">&nbsp;</FONT></TD>
        <TD><FONT size="1">&nbsp;</FONT></TD>
        <TD><FONT size="1">&nbsp;</FONT></TD>
        <TD><FONT size="1">&nbsp;</FONT></TD>
        <TD><FONT size="1">&nbsp;</FONT></TD>
</TR>
<TR valign="bottom">
        <TD><FONT size="1">&nbsp;</FONT></TD>
        <TD><FONT size="1">&nbsp;</FONT></TD>
        <TD nowrap align="center" colspan="3"><FONT size="1"><B>Warrants and</B></FONT></TD>
        <TD><FONT size="1">&nbsp;</FONT></TD>
        <TD><FONT size="1">&nbsp;</FONT></TD>
        <TD><FONT size="1">&nbsp;</FONT></TD>
        <TD nowrap align="center" colspan="3"><FONT size="1"><B>Percentage</B></FONT></TD>
</TR>
<TR valign="bottom">
        <TD><FONT size="1">&nbsp;</FONT></TD>
        <TD><FONT size="1">&nbsp;</FONT></TD>
        <TD nowrap align="center" colspan="3"><FONT size="1"><B>Convertible</B></FONT></TD>
        <TD><FONT size="1">&nbsp;</FONT></TD>
        <TD><FONT size="1">&nbsp;</FONT></TD>
        <TD><FONT size="1">&nbsp;</FONT></TD>
        <TD nowrap align="center" colspan="3"><FONT size="1"><B>of Shares</B></FONT></TD>
</TR>
<TR valign="bottom">
        <TD nowrap align="center"><FONT size="1"><B>Name and Address of Owner</B></FONT></TD>
        <TD><FONT size="1">&nbsp;</FONT></TD>
        <TD nowrap align="center" colspan="3"><FONT size="1"><B>Securities</B></FONT></TD>
        <TD><FONT size="1">&nbsp;</FONT></TD>
        <TD nowrap align="center"><FONT size="1"><B>Position at Company</B></FONT></TD>
        <TD><FONT size="1">&nbsp;</FONT></TD>
        <TD nowrap align="center" colspan="3"><FONT size="1"><B>(11)</B></FONT></TD>
</TR>
<TR valign="bottom">
        <TD nowrap align="center"><HR size="1" noshade></TD>
        <TD><FONT size="1">&nbsp;</FONT></TD>
        <TD colspan="3"><HR size="1" noshade></TD>
        <TD><FONT size="1">&nbsp;</FONT></TD>
        <TD nowrap align="center"><HR size="1" noshade></TD>
        <TD><FONT size="1">&nbsp;</FONT></TD>
        <TD colspan="3"><HR size="1" noshade></TD>
</TR>

<TR valign="bottom">
        <TD valign="top"><FONT size="2">Alexander L. Cappello<BR>
1299 Ocean Avenue<BR>
Suite&nbsp;306<BR>
Santa Monica, CA 90401</FONT></TD>
        <TD><FONT size="2">&nbsp;</FONT></TD>
        <TD nowrap align="right" valign="top"><FONT size="2">&nbsp;</FONT></TD>
        <TD align="right" valign="top"><FONT size="2">1,324,149
</FONT></TD>
        <TD valign="top"><FONT size="2">(7)</FONT></TD>
        <TD><FONT size="2">&nbsp;</FONT></TD>
        <TD align="CENTER" valign="top"><FONT size="2">Chairman of the
Board, Director
</FONT></TD>
        <TD><FONT size="2">&nbsp;</FONT></TD>
        <TD nowrap align="right" valign="top"><FONT size="2">&nbsp;</FONT></TD>
        <TD align="right" valign="top"><FONT size="2">3.2</FONT></TD>
        <TD nowrap valign="top"><FONT size="2">%</FONT></TD>
</TR>
<TR><TD><TR><TD><TR><TD><TR><TD>
<TR><TD><TR><TD><TR><TD><TR><TD>

<TR valign="bottom">
        <TD valign="top"><FONT size="2">John M. Bendheim<BR>
2001 S. Barrington Street<BR>
Suite&nbsp;100<BR>
Los Angeles, CA 90025</FONT></TD>
        <TD><FONT size="2">&nbsp;</FONT></TD>
        <TD nowrap align="right" valign="top"><FONT size="2">&nbsp;</FONT></TD>
        <TD align="right" valign="top"><FONT size="2">208,744
</FONT></TD>
        <TD valign="top"><FONT size="2">(8)</FONT></TD>
        <TD><FONT size="2">&nbsp;</FONT></TD>
        <TD align="CENTER" valign="top"><FONT size="2">Director
</FONT></TD>
        <TD><FONT size="2">&nbsp;</FONT></TD>
        <TD nowrap align="right" valign="top"><FONT size="2">&nbsp;</FONT></TD>
        <TD align="right" valign="top"><FONT size="2">*</FONT></TD>
        <TD valign="top"><FONT size="2">&nbsp;</FONT></TD>
</TR>
<TR><TD><TR><TD><TR><TD><TR><TD>
<TR><TD><TR><TD><TR><TD><TR><TD>

<TR valign="bottom">
        <TD valign="top"><FONT size="2">Thomas J. Pernice<BR>
1299 Ocean Avenue, Suite&nbsp;306<BR>
Santa Monica, CA 90401</FONT></TD>
        <TD><FONT size="2">&nbsp;</FONT></TD>
        <TD nowrap align="right" valign="top"><FONT size="2">&nbsp;</FONT></TD>
        <TD align="right" valign="top"><FONT size="2">755,919
</FONT></TD>
        <TD valign="top"><FONT size="2">(9)</FONT></TD>
        <TD><FONT size="2">&nbsp;</FONT></TD>
        <TD align="CENTER" valign="top"><FONT size="2">Treasurer and
Secretary, Director
</FONT></TD>
        <TD><FONT size="2">&nbsp;</FONT></TD>
        <TD nowrap align="right" valign="top"><FONT size="2">&nbsp;</FONT></TD>
        <TD align="right" valign="top"><FONT size="2">1.9</FONT></TD>
        <TD nowrap valign="top"><FONT size="2">%</FONT></TD>
</TR>
<TR><TD><TR><TD><TR><TD><TR><TD>
<TR><TD><TR><TD><TR><TD><TR><TD>

<TR valign="bottom">
        <TD valign="top"><FONT size="2">William M. Finkelstein<BR>
6355 Topanga Canyon<BR>
Boulevard, Suite&nbsp;510<BR>
Woodland Hills, CA 91367</FONT></TD>
        <TD><FONT size="2">&nbsp;</FONT></TD>
        <TD nowrap align="right" valign="top"><FONT size="2">&nbsp;</FONT></TD>
        <TD align="right" valign="top"><FONT size="2">0
</FONT></TD>
        <TD valign="top"><FONT size="2">&nbsp;</FONT></TD>
        <TD><FONT size="2">&nbsp;</FONT></TD>
        <TD align="CENTER" valign="top"><FONT size="2">Chief Financial<BR>
Officer
</FONT></TD>
        <TD><FONT size="2">&nbsp;</FONT></TD>
        <TD nowrap align="right" valign="top"><FONT size="2">&nbsp;</FONT></TD>
        <TD align="right" valign="top"><FONT size="2">*</FONT></TD>
        <TD valign="top"><FONT size="2">&nbsp;</FONT></TD>
</TR>
<TR><TD><TR><TD><TR><TD><TR><TD>
<TR><TD><TR><TD><TR><TD><TR><TD>

<TR valign="bottom">
        <TD valign="top"><FONT size="2">All officers and directors<BR>
as a group (9)</FONT></TD>
        <TD><FONT size="2">&nbsp;</FONT></TD>
        <TD nowrap align="right" valign="top"><FONT size="2">&nbsp;</FONT></TD>

<TD align="right" valign="top" NOWRAP><FONT size="2">18,447,454
</FONT></TD>
        <TD valign="top"><FONT size="2">(10)</FONT></TD>
        <TD><FONT size="2">&nbsp;</FONT></TD>
        <TD align="left" valign="top"><FONT size="2">&nbsp;</FONT></TD>
        <TD><FONT size="2">&nbsp;</FONT></TD>
        <TD nowrap align="right" valign="top"><FONT size="2">&nbsp;</FONT></TD>
        <TD align="right" valign="top"><FONT size="2">42.0</FONT></TD>
        <TD nowrap valign="top"><FONT size="2">%</FONT></TD>
</TR>
</TABLE>
</CENTER>

<P>
<HR WIDTH="26%" ALIGN="LEFT" SIZE="1">

<DIV><FONT size="2">(1)&nbsp; Leonard and Ellen Millstein are husband and wife. Shares held in their
names comprise shares held in his name (565,100), shares held in her name
(2,713,359), shares held in the name of William Millstein (888,350
shares); shares held in the name of Melvin Millstein (908,350 shares) and options in his name to purchase up to 125,000 shares of Common
Stock at an exercise price of $0.20 per share. Mr. Millstein and Mrs. Millstein disclaim
beneficial ownership of the shares held in the other&#146;s name and disclaim that
they are part of any &#147;group&#148; for SEC purposes.
</FONT>

<P><FONT size="2">(2)&nbsp; Shares held in the name of Boris Skurkovich include shares held in his name
(2,505,270), and shares held in the name of Carol Marjorie Dorros (550,000),
Samuel Skurkovich (701,000), and Samuel Aaron Skurkovich (1,121,000). Includes
options to purchase up to 100,000 shares of Common Stock at an exercise price
of $0.01 per share; options to purchase up to 150,000 shares of Common Stock at
an exercise price of $0.20 per share, and options to purchase 50,000 shares of
Common Stock at an exercise price of $0.10 per share.
</FONT>

<P><FONT size="2">(3)&nbsp; Shares held in the name of Gerard Cappello include warrants held in his
name to purchase 655,919 shares of Common Stock at an exercise price of $0.15
per share and warrants to purchase 1,405,541 shares of Common Stock at an
exercise price of $0.15 per share held in the name of Cappello Capital Corp.
(&#147;CCC&#148;), a company wholly-owned by Mr.&nbsp;Cappello. Shares held also include the
right to acquire 100,000 shares of Common Stock upon conversion of Company
Convertible Subordinated Debt due September&nbsp;30, 2004 (&#147;Convertible Debt&#148;) held
in Mr.&nbsp;Cappello&#146;s name, and the right of CCC to acquire 604,200 shares of
Common Stock upon exercise of an option for up to $151,050 principal amount of
Convertible Debt and subsequent conversion of such Convertible Debt.
</FONT>

<P align="center"><FONT size="2">Page 5 of 24
</FONT></DIV>

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<P><HR noshade><P>
<H5 align="left" style="page-break-before:always"><A HREF="#toc">Table of Contents</A></H5><P>
<P><FONT size="2">(4)&nbsp; Shares held in the name of Edmond F. Buccellato comprise shares held in his
name (500,000), and shares held in the names of Edmond F. and Leana J.
Buccellato Living Trust (1,331,666 shares), Amy Buccellato (8,400 shares),
Matthew Buccellato (10,490 shares) and Buccellato &#038; Finkelstein, Inc. (88,334).
Includes options to purchase up to 105,543 shares of Common Stock at an
exercise price of $0.10 per share,
options to purchase up to 50,000 shares of Common Stock at an exercise price of
$0.10 per share and options to purchase up to 50,000 shares of Common Stock at
an exercise price of $0.20 per share.
</FONT>
<P><FONT size="2">(5)&nbsp; Shares held in the name of Simon Skurkovich include options to purchase up
to 623,000 shares of Common Stock at an exercise price of $0.10 per share, and
options to purchase up to 300,000 shares of Common Stock at an exercise price
of $0.10 per share. Simon Skurkovich is the father of Boris Skurkovich and
Ellen Millstein but disclaims beneficial ownership of the shares attributed to
both of them and disclaims that the three of them are part of a &#147;group&#148; for SEC
purposes.
</FONT>
<P><FONT size="2">(6)&nbsp; Includes shares held in the names of Lawrence Loomis (1,325,000 shares) and
New Horizons Diagnostics, Inc. (200,000 shares). Includes options to purchase
up to 10,000 shares of Common Stock at an exercise price of $0.10 per share,
and options to purchase up to 75,000 shares of Common Stock at an exercise
price of $0.20 per share.
</FONT>
<P><FONT size="2">(7)&nbsp; Shares held in the name of Alexander L. Cappello include warrants held in
his name to purchase 100,000 shares of Common Stock at an exercise price of
$0.25 per share, and warrants held by the Alexander L. and Linda Cappello
Family Trust to purchase 1,115,061 shares of Common Stock at an exercise price
of $0.15 per share. Also includes the right to acquire 109,088 shares of
Common Stock upon conversion of Convertible Debt. Mr.&nbsp;Cappello is the brother
of Gerard K. Cappello.
</FONT>
<P><FONT size="2">(8)&nbsp; Shares held in the name of John M. Bendheim comprise warrants to purchase
100,000 shares of Common Stock at an exercise price of $0.25 per share, and the
right to acquire 108,744 shares of Common Stock upon conversion of Convertible
Debt.
</FONT>
<P><FONT size="2">(9)&nbsp; Shares held in the name of Thomas J. Pernice include warrants to purchase
100,000 shares of Common Stock at an exercise price of $0.25 per share, and
warrants assigned by CCC to him to purchase 655,919 shares of Common Stock at
an exercise price of $0.15 per share.
</FONT>
<P><FONT size="2">(10)&nbsp; Includes 2,070,980 shares of Common Stock underlying warrants, 1,638,543
shares of Common Stock underlying options and 317,832 shares of Common Stock
underlying Convertible Debt.
</FONT>
<P><FONT size="2">(11)&nbsp; The percentage of shares is calculated on the basis of the number of
shares of Common Stock outstanding as of September&nbsp;30, 2001, plus for each
person or group, any shares of Common Stock that such person or group has the
right to acquire within 60&nbsp;days pursuant to options, warrants, conversion
privileges or other rights.</FONT>

<P>
<HR WIDTH="26%" ALIGN="LEFT" SIZE="1">
<DIV><FONT size="2">&#149;&nbsp;Represents less than 1% of the outstanding shares of Company Common Stock.
</FONT>
<P align="center"><FONT size="2">Page 6 of 24
</FONT></DIV>

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<H5 align="left" style="page-break-before:always"><A HREF="#toc">Table of Contents</A></H5><P>
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<P align="center"><FONT size="2"><B>COMPENSATION OF DIRECTORS AND EXECUTIVE OFFICERS</B></FONT>

<P><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;The following table sets forth the compensation paid by the Company since
January&nbsp;1, 1998 through December&nbsp;31, 2000, for the Chief Executive Officer of
the Company and each other executive officer of the Company who was paid more
than $100,000 during the year ended December&nbsp;31, 2000 (the &#147;Named Executive
Officers&#148;):
</FONT>
<P align="center"><FONT size="2"><B>Summary Compensation Table</B></FONT>

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        <TD nowrap align="center" colspan="3"><FONT size="1"><B>Restricted</B></FONT></TD>
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        <TD nowrap align="center"><FONT size="1"><B>Name and</B></FONT></TD>
        <TD><FONT size="1">&nbsp;</FONT></TD>
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        <TD><FONT size="1">&nbsp;</FONT></TD>
        <TD nowrap align="center" colspan="3"><FONT size="1"><B>Other Annual</B></FONT></TD>
        <TD><FONT size="1">&nbsp;</FONT></TD>
        <TD nowrap align="center" colspan="3"><FONT size="1"><B>Stock</B></FONT></TD>
        <TD><FONT size="1">&nbsp;</FONT></TD>
        <TD nowrap align="center" colspan="3"><FONT size="1"><B>Securities</B></FONT></TD>
        <TD><FONT size="1">&nbsp;</FONT></TD>
        <TD nowrap align="center" colspan="3"><FONT size="1"><B>LTIP</B></FONT></TD>
        <TD><FONT size="1">&nbsp;</FONT></TD>
        <TD nowrap align="center" colspan="3"><FONT size="1"><B>All Other</B></FONT></TD>
</TR>
<TR valign="bottom">
        <TD nowrap align="center"><FONT size="1"><B>Principal</B></FONT></TD>
        <TD><FONT size="1">&nbsp;</FONT></TD>
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        <TD><FONT size="1">&nbsp;</FONT></TD>
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        <TD><FONT size="1">&nbsp;</FONT></TD>
        <TD nowrap align="center" colspan="3"><FONT size="1"><B>Compensation</B></FONT></TD>
        <TD><FONT size="1">&nbsp;</FONT></TD>
        <TD nowrap align="center" colspan="3"><FONT size="1"><B>Award(s)</B></FONT></TD>
        <TD><FONT size="1">&nbsp;</FONT></TD>
        <TD nowrap align="center" colspan="3"><FONT size="1"><B>Underlying</B></FONT></TD>
        <TD><FONT size="1">&nbsp;</FONT></TD>
        <TD nowrap align="center" colspan="3"><FONT size="1"><B>Payouts</B></FONT></TD>
        <TD><FONT size="1">&nbsp;</FONT></TD>
        <TD nowrap align="center" colspan="3"><FONT size="1"><B>Compensation</B></FONT></TD>
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        <TD nowrap align="center"><FONT size="1"><B>Position</B></FONT></TD>
        <TD><FONT size="1">&nbsp;</FONT></TD>
        <TD nowrap align="center" colspan="3"><FONT size="1"><B>Year</B></FONT></TD>
        <TD><FONT size="1">&nbsp;</FONT></TD>
        <TD nowrap align="center" colspan="3"><FONT size="1"><B>Salary($)</B></FONT></TD>
        <TD><FONT size="1">&nbsp;</FONT></TD>
        <TD nowrap align="center" colspan="3"><FONT size="1"><B>Bonus($)</B></FONT></TD>
        <TD><FONT size="1">&nbsp;</FONT></TD>
        <TD nowrap align="center" colspan="3"><FONT size="1"><B>($)</B></FONT></TD>
        <TD><FONT size="1">&nbsp;</FONT></TD>
        <TD nowrap align="center" colspan="3"><FONT size="1"><B>($)</B></FONT></TD>
        <TD><FONT size="1">&nbsp;</FONT></TD>
        <TD nowrap align="center" colspan="3"><FONT size="1"><B>Options/SARs(#)</B></FONT></TD>
        <TD><FONT size="1">&nbsp;</FONT></TD>
        <TD nowrap align="center" colspan="3"><FONT size="1"><B>($)</B></FONT></TD>
        <TD><FONT size="1">&nbsp;</FONT></TD>
        <TD nowrap align="center" colspan="3"><FONT size="1"><B>($)</B></FONT></TD>
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<TR valign="bottom">
        <TD><DIV style="margin-left:10px; text-indent:-10px"><FONT size="1">Edmond F. Buccellato</FONT></DIV></TD>
        <TD><FONT size="1">&nbsp;</FONT></TD>
        <TD><FONT size="1">&nbsp;</FONT></TD>
        <TD align="right"><FONT size="1">2000</FONT></TD>
        <TD><FONT size="1">&nbsp;</FONT></TD>
        <TD><FONT size="1">&nbsp;</FONT></TD>
        <TD align="right"><FONT size="1">$</FONT></TD>
        <TD align="right"><FONT size="1">72,500</FONT></TD>
        <TD><FONT size="1">&nbsp;</FONT></TD>
        <TD><FONT size="1">&nbsp;</FONT></TD>
        <TD align="right"><FONT size="1">$</FONT></TD>
        <TD align="right"><FONT size="1">0</FONT></TD>
        <TD><FONT size="1">&nbsp;</FONT></TD>
        <TD><FONT size="1">&nbsp;</FONT></TD>
        <TD align="right"><FONT size="1">$</FONT></TD>
        <TD align="right"><FONT size="1">0</FONT></TD>
        <TD><FONT size="1">&nbsp;</FONT></TD>
        <TD><FONT size="1">&nbsp;</FONT></TD>
        <TD><FONT size="1">&nbsp;</FONT></TD>
        <TD align="right"><FONT size="1">*</FONT></TD>
        <TD><FONT size="1">&nbsp;</FONT></TD>
        <TD><FONT size="1">&nbsp;</FONT></TD>
        <TD><FONT size="1">&nbsp;</FONT></TD>
        <TD align="right"><FONT size="1">0</FONT></TD>
        <TD><FONT size="1">&nbsp;</FONT></TD>
        <TD><FONT size="1">&nbsp;</FONT></TD>
        <TD align="right"><FONT size="1">$</FONT></TD>
        <TD align="right"><FONT size="1">0</FONT></TD>
        <TD><FONT size="1">&nbsp;</FONT></TD>
        <TD><FONT size="1">&nbsp;</FONT></TD>
        <TD align="right"><FONT size="1">$</FONT></TD>
        <TD align="right"><FONT size="1">0</FONT></TD>
        <TD><FONT size="1">&nbsp;</FONT></TD>
</TR>

<TR valign="bottom">
        <TD><DIV style="margin-left:10px; text-indent:-10px"><FONT size="1">Chief Executive</FONT></DIV></TD>
        <TD><FONT size="1">&nbsp;</FONT></TD>
        <TD><FONT size="1">&nbsp;</FONT></TD>
        <TD align="right"><FONT size="1">1999</FONT></TD>
        <TD><FONT size="1">&nbsp;</FONT></TD>
        <TD><FONT size="1">&nbsp;</FONT></TD>
        <TD align="right"><FONT size="1">$</FONT></TD>
        <TD align="right"><FONT size="1">75,000</FONT></TD>
        <TD><FONT size="1">&nbsp;</FONT></TD>
        <TD><FONT size="1">&nbsp;</FONT></TD>
        <TD align="right"><FONT size="1">$</FONT></TD>
        <TD align="right"><FONT size="1">0</FONT></TD>
        <TD><FONT size="1">&nbsp;</FONT></TD>
        <TD><FONT size="1">&nbsp;</FONT></TD>
        <TD align="right"><FONT size="1">$</FONT></TD>
        <TD align="right"><FONT size="1">0</FONT></TD>
        <TD><FONT size="1">&nbsp;</FONT></TD>
        <TD><FONT size="1">&nbsp;</FONT></TD>
        <TD><FONT size="1">&nbsp;</FONT></TD>
        <TD><FONT size="1">&nbsp;</FONT></TD>
        <TD><FONT size="1">&nbsp;</FONT></TD>
        <TD><FONT size="1">&nbsp;</FONT></TD>
        <TD><FONT size="1">&nbsp;</FONT></TD>
        <TD align="right"><FONT size="1">0</FONT></TD>
        <TD><FONT size="1">&nbsp;</FONT></TD>
        <TD><FONT size="1">&nbsp;</FONT></TD>
        <TD align="right"><FONT size="1">$</FONT></TD>
        <TD align="right"><FONT size="1">0</FONT></TD>
        <TD><FONT size="1">&nbsp;</FONT></TD>
        <TD><FONT size="1">&nbsp;</FONT></TD>
        <TD align="right"><FONT size="1">$</FONT></TD>
        <TD align="right"><FONT size="1">0</FONT></TD>
        <TD><FONT size="1">&nbsp;</FONT></TD>
</TR>

<TR valign="bottom">
        <TD><DIV style="margin-left:10px; text-indent:-10px"><FONT size="1">Officer (1)</FONT></DIV></TD>
        <TD><FONT size="1">&nbsp;</FONT></TD>
        <TD><FONT size="1">&nbsp;</FONT></TD>
        <TD align="right"><FONT size="1">1998</FONT></TD>
        <TD><FONT size="1">&nbsp;</FONT></TD>
        <TD><FONT size="1">&nbsp;</FONT></TD>
        <TD align="right"><FONT size="1">$</FONT></TD>
        <TD align="right"><FONT size="1">50,000</FONT></TD>
        <TD><FONT size="1">&nbsp;</FONT></TD>
        <TD><FONT size="1">&nbsp;</FONT></TD>
        <TD align="right"><FONT size="1">$</FONT></TD>
        <TD align="right"><FONT size="1">0</FONT></TD>
        <TD><FONT size="1">&nbsp;</FONT></TD>
        <TD><FONT size="1">&nbsp;</FONT></TD>
        <TD align="right"><FONT size="1">$</FONT></TD>
        <TD align="right"><FONT size="1">0</FONT></TD>
        <TD><FONT size="1">&nbsp;</FONT></TD>
        <TD><FONT size="1">&nbsp;</FONT></TD>
        <TD><FONT size="1">&nbsp;</FONT></TD>
        <TD><FONT size="1">&nbsp;</FONT></TD>
        <TD><FONT size="1">&nbsp;</FONT></TD>
        <TD><FONT size="1">&nbsp;</FONT></TD>
        <TD><FONT size="1">&nbsp;</FONT></TD>
        <TD align="right"><FONT size="1">0</FONT></TD>
        <TD><FONT size="1">&nbsp;</FONT></TD>
        <TD><FONT size="1">&nbsp;</FONT></TD>
        <TD align="right"><FONT size="1">$</FONT></TD>
        <TD align="right"><FONT size="1">0</FONT></TD>
        <TD><FONT size="1">&nbsp;</FONT></TD>
        <TD><FONT size="1">&nbsp;</FONT></TD>
        <TD align="right"><FONT size="1">$</FONT></TD>
        <TD align="right"><FONT size="1">0</FONT></TD>
        <TD><FONT size="1">&nbsp;</FONT></TD>
</TR>

<TR valign="bottom">
        <TD><DIV style="margin-left:10px; text-indent:-10px"><FONT size="1">Paul J. Marangos</FONT></DIV></TD>
        <TD><FONT size="1">&nbsp;</FONT></TD>
        <TD><FONT size="1">&nbsp;</FONT></TD>
        <TD align="right"><FONT size="1">2000</FONT></TD>
        <TD><FONT size="1">&nbsp;</FONT></TD>
        <TD><FONT size="1">&nbsp;</FONT></TD>
        <TD align="right"><FONT size="1">$</FONT></TD>
        <TD align="right"><FONT size="1">40,000</FONT></TD>
        <TD><FONT size="1">&nbsp;</FONT></TD>
        <TD><FONT size="1">&nbsp;</FONT></TD>
        <TD align="right"><FONT size="1">$</FONT></TD>
        <TD align="right"><FONT size="1">25,000</FONT></TD>
        <TD><FONT size="1">&nbsp;</FONT></TD>
        <TD><FONT size="1">&nbsp;</FONT></TD>
        <TD align="right"><FONT size="1">$</FONT></TD>
        <TD align="right"><FONT size="1">0</FONT></TD>
        <TD><FONT size="1">&nbsp;</FONT></TD>
        <TD><FONT size="1">&nbsp;</FONT></TD>
        <TD><FONT size="1">&nbsp;</FONT></TD>
        <TD><FONT size="1">&nbsp;</FONT></TD>
        <TD><FONT size="1">&nbsp;</FONT></TD>
        <TD><FONT size="1">&nbsp;</FONT></TD>
        <TD><FONT size="1">&nbsp;</FONT></TD>
        <TD align="right"><FONT size="1">0</FONT></TD>
        <TD><FONT size="1">&nbsp;</FONT></TD>
        <TD><FONT size="1">&nbsp;</FONT></TD>
        <TD align="right"><FONT size="1">$</FONT></TD>
        <TD align="right"><FONT size="1">0</FONT></TD>
        <TD><FONT size="1">&nbsp;</FONT></TD>
        <TD><FONT size="1">&nbsp;</FONT></TD>
        <TD align="right"><FONT size="1">$</FONT></TD>
        <TD align="right"><FONT size="1">0</FONT></TD>
        <TD><FONT size="1">&nbsp;</FONT></TD>
</TR>

<TR valign="bottom">
        <TD><DIV style="margin-left:10px; text-indent:-10px"><FONT size="1">Chief Executive
Officer (2)</FONT></DIV></TD>
        <TD><FONT size="1">&nbsp;</FONT></TD>
        <TD><FONT size="1">&nbsp;</FONT></TD>
        <TD><FONT size="1">&nbsp;</FONT></TD>
        <TD><FONT size="1">&nbsp;</FONT></TD>
        <TD><FONT size="1">&nbsp;</FONT></TD>
        <TD><FONT size="1">&nbsp;</FONT></TD>
        <TD><FONT size="1">&nbsp;</FONT></TD>
        <TD><FONT size="1">&nbsp;</FONT></TD>
        <TD><FONT size="1">&nbsp;</FONT></TD>
        <TD><FONT size="1">&nbsp;</FONT></TD>
        <TD><FONT size="1">&nbsp;</FONT></TD>
        <TD><FONT size="1">&nbsp;</FONT></TD>
        <TD><FONT size="1">&nbsp;</FONT></TD>
        <TD><FONT size="1">&nbsp;</FONT></TD>
        <TD><FONT size="1">&nbsp;</FONT></TD>
        <TD><FONT size="1">&nbsp;</FONT></TD>
        <TD><FONT size="1">&nbsp;</FONT></TD>
        <TD><FONT size="1">&nbsp;</FONT></TD>
        <TD><FONT size="1">&nbsp;</FONT></TD>
        <TD><FONT size="1">&nbsp;</FONT></TD>
        <TD><FONT size="1">&nbsp;</FONT></TD>
        <TD><FONT size="1">&nbsp;</FONT></TD>
        <TD><FONT size="1">&nbsp;</FONT></TD>
        <TD><FONT size="1">&nbsp;</FONT></TD>
        <TD><FONT size="1">&nbsp;</FONT></TD>
        <TD><FONT size="1">&nbsp;</FONT></TD>
        <TD><FONT size="1">&nbsp;</FONT></TD>
        <TD><FONT size="1">&nbsp;</FONT></TD>
        <TD><FONT size="1">&nbsp;</FONT></TD>
        <TD><FONT size="1">&nbsp;</FONT></TD>
        <TD><FONT size="1">&nbsp;</FONT></TD>
        <TD><FONT size="1">&nbsp;</FONT></TD>
</TR>

<TR valign="bottom">
        <TD><DIV style="margin-left:10px; text-indent:-10px"><FONT size="1">Simon Skurkovich</FONT></DIV></TD>
        <TD><FONT size="1">&nbsp;</FONT></TD>
        <TD><FONT size="1">&nbsp;</FONT></TD>
        <TD align="right"><FONT size="1">2000</FONT></TD>
        <TD><FONT size="1">&nbsp;</FONT></TD>
        <TD><FONT size="1">&nbsp;</FONT></TD>
        <TD align="right"><FONT size="1">$</FONT></TD>
        <TD align="right"><FONT size="1">30,000</FONT></TD>
        <TD><FONT size="1">&nbsp;</FONT></TD>
        <TD><FONT size="1">&nbsp;</FONT></TD>
        <TD align="right"><FONT size="1">$</FONT></TD>
        <TD align="right"><FONT size="1">0</FONT></TD>
        <TD><FONT size="1">&nbsp;</FONT></TD>
        <TD><FONT size="1">&nbsp;</FONT></TD>
        <TD align="right"><FONT size="1">$</FONT></TD>
        <TD align="right"><FONT size="1">0</FONT></TD>
        <TD><FONT size="1">&nbsp;</FONT></TD>
        <TD><FONT size="1">&nbsp;</FONT></TD>
        <TD><FONT size="1">&nbsp;</FONT></TD>
        <TD align="right"><FONT size="1">*</FONT></TD>
        <TD><FONT size="1">&nbsp;</FONT></TD>
        <TD><FONT size="1">&nbsp;</FONT></TD>
        <TD><FONT size="1">&nbsp;</FONT></TD>
        <TD align="right"><FONT size="1">0</FONT></TD>
        <TD><FONT size="1">&nbsp;</FONT></TD>
        <TD><FONT size="1">&nbsp;</FONT></TD>
        <TD align="right"><FONT size="1">$</FONT></TD>
        <TD align="right"><FONT size="1">0</FONT></TD>
        <TD><FONT size="1">&nbsp;</FONT></TD>
        <TD><FONT size="1">&nbsp;</FONT></TD>
        <TD align="right"><FONT size="1">$</FONT></TD>
        <TD align="right"><FONT size="1">0</FONT></TD>
        <TD><FONT size="1">&nbsp;</FONT></TD>
</TR>

<TR valign="bottom">
        <TD><DIV style="margin-left:10px; text-indent:-10px"><FONT size="1">Chairman Emeritus,</FONT></DIV></TD>
        <TD><FONT size="1">&nbsp;</FONT></TD>
        <TD><FONT size="1">&nbsp;</FONT></TD>
        <TD align="right"><FONT size="1">1999</FONT></TD>
        <TD><FONT size="1">&nbsp;</FONT></TD>
        <TD><FONT size="1">&nbsp;</FONT></TD>
        <TD align="right"><FONT size="1">$</FONT></TD>
        <TD align="right"><FONT size="1">100,000</FONT></TD>
        <TD><FONT size="1">&nbsp;</FONT></TD>
        <TD><FONT size="1">&nbsp;</FONT></TD>
        <TD align="right"><FONT size="1">$</FONT></TD>
        <TD align="right"><FONT size="1">0</FONT></TD>
        <TD><FONT size="1">&nbsp;</FONT></TD>
        <TD><FONT size="1">&nbsp;</FONT></TD>
        <TD align="right"><FONT size="1">$</FONT></TD>
        <TD align="right"><FONT size="1">0</FONT></TD>
        <TD><FONT size="1">&nbsp;</FONT></TD>
        <TD><FONT size="1">&nbsp;</FONT></TD>
        <TD><FONT size="1">&nbsp;</FONT></TD>
        <TD><FONT size="1">&nbsp;</FONT></TD>
        <TD><FONT size="1">&nbsp;</FONT></TD>
        <TD><FONT size="1">&nbsp;</FONT></TD>
        <TD><FONT size="1">&nbsp;</FONT></TD>
        <TD align="right"><FONT size="1">0</FONT></TD>
        <TD><FONT size="1">&nbsp;</FONT></TD>
        <TD><FONT size="1">&nbsp;</FONT></TD>
        <TD align="right"><FONT size="1">$</FONT></TD>
        <TD align="right"><FONT size="1">0</FONT></TD>
        <TD><FONT size="1">&nbsp;</FONT></TD>
        <TD><FONT size="1">&nbsp;</FONT></TD>
        <TD align="right"><FONT size="1">$</FONT></TD>
        <TD align="right"><FONT size="1">0</FONT></TD>
        <TD><FONT size="1">&nbsp;</FONT></TD>
</TR>

<TR valign="bottom">
        <TD><DIV style="margin-left:10px; text-indent:-10px"><FONT size="1">Director of</FONT></DIV></TD>
        <TD><FONT size="1">&nbsp;</FONT></TD>
        <TD><FONT size="1">&nbsp;</FONT></TD>
        <TD align="right"><FONT size="1">1998</FONT></TD>
        <TD><FONT size="1">&nbsp;</FONT></TD>
        <TD><FONT size="1">&nbsp;</FONT></TD>
        <TD align="right"><FONT size="1">$</FONT></TD>
        <TD align="right"><FONT size="1">100,000</FONT></TD>
        <TD><FONT size="1">&nbsp;</FONT></TD>
        <TD><FONT size="1">&nbsp;</FONT></TD>
        <TD align="right"><FONT size="1">$</FONT></TD>
        <TD align="right"><FONT size="1">0</FONT></TD>
        <TD><FONT size="1">&nbsp;</FONT></TD>
        <TD><FONT size="1">&nbsp;</FONT></TD>
        <TD align="right"><FONT size="1">$</FONT></TD>
        <TD align="right"><FONT size="1">0</FONT></TD>
        <TD><FONT size="1">&nbsp;</FONT></TD>
        <TD><FONT size="1">&nbsp;</FONT></TD>
        <TD><FONT size="1">&nbsp;</FONT></TD>
        <TD><FONT size="1">&nbsp;</FONT></TD>
        <TD><FONT size="1">&nbsp;</FONT></TD>
        <TD><FONT size="1">&nbsp;</FONT></TD>
        <TD><FONT size="1">&nbsp;</FONT></TD>
        <TD align="right"><FONT size="1">0</FONT></TD>
        <TD><FONT size="1">&nbsp;</FONT></TD>
        <TD><FONT size="1">&nbsp;</FONT></TD>
        <TD align="right"><FONT size="1">$</FONT></TD>
        <TD align="right"><FONT size="1">0</FONT></TD>
        <TD><FONT size="1">&nbsp;</FONT></TD>
        <TD><FONT size="1">&nbsp;</FONT></TD>
        <TD align="right"><FONT size="1">$</FONT></TD>
        <TD align="right"><FONT size="1">0</FONT></TD>
        <TD><FONT size="1">&nbsp;</FONT></TD>
</TR>

<TR valign="bottom">
        <TD><DIV style="margin-left:10px; text-indent:-10px"><FONT size="1">Research and
Development (3)</FONT></DIV></TD>
        <TD><FONT size="1">&nbsp;</FONT></TD>
        <TD><FONT size="1">&nbsp;</FONT></TD>
        <TD><FONT size="1">&nbsp;</FONT></TD>
        <TD><FONT size="1">&nbsp;</FONT></TD>
        <TD><FONT size="1">&nbsp;</FONT></TD>
        <TD><FONT size="1">&nbsp;</FONT></TD>
        <TD><FONT size="1">&nbsp;</FONT></TD>
        <TD><FONT size="1">&nbsp;</FONT></TD>
        <TD><FONT size="1">&nbsp;</FONT></TD>
        <TD><FONT size="1">&nbsp;</FONT></TD>
        <TD><FONT size="1">&nbsp;</FONT></TD>
        <TD><FONT size="1">&nbsp;</FONT></TD>
        <TD><FONT size="1">&nbsp;</FONT></TD>
        <TD><FONT size="1">&nbsp;</FONT></TD>
        <TD><FONT size="1">&nbsp;</FONT></TD>
        <TD><FONT size="1">&nbsp;</FONT></TD>
        <TD><FONT size="1">&nbsp;</FONT></TD>
        <TD><FONT size="1">&nbsp;</FONT></TD>
        <TD><FONT size="1">&nbsp;</FONT></TD>
        <TD><FONT size="1">&nbsp;</FONT></TD>
        <TD><FONT size="1">&nbsp;</FONT></TD>
        <TD><FONT size="1">&nbsp;</FONT></TD>
        <TD><FONT size="1">&nbsp;</FONT></TD>
        <TD><FONT size="1">&nbsp;</FONT></TD>
        <TD><FONT size="1">&nbsp;</FONT></TD>
        <TD><FONT size="1">&nbsp;</FONT></TD>
        <TD><FONT size="1">&nbsp;</FONT></TD>
        <TD><FONT size="1">&nbsp;</FONT></TD>
        <TD><FONT size="1">&nbsp;</FONT></TD>
        <TD><FONT size="1">&nbsp;</FONT></TD>
        <TD><FONT size="1">&nbsp;</FONT></TD>
        <TD><FONT size="1">&nbsp;</FONT></TD>
</TR>
</TABLE>
</CENTER>
<P><FONT size="2">*&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;- See &#147;Compensation of Directors&#148; below</FONT>

<P>
<HR WIDTH="26%" ALIGN="LEFT" SIZE="1">
<DIV><FONT size="2">(1)&nbsp; Mr.&nbsp;Buccellato was the Chief Executive Officer of the Company prior to the
hiring of Dr.&nbsp;Marangos. Since April, 2001, Mr.&nbsp;Buccellato has served as
President and Chief Executive Officer of the Company.
</FONT>
<P><FONT size="2">(2)&nbsp; Dr.&nbsp;Marangos joined the Company in August 2000 at an annual salary of
$120,000. In addition, he was paid a signing bonus of $25,000. In April, 2001,
Dr.&nbsp;Marangos resigned as an officer and employee of the Company.
</FONT>
<P><FONT size="2">(3)&nbsp; Dr.&nbsp;Skurkovich was the Chairman of the Board prior to the hiring of Dr.
Marangos.
</FONT>
<P><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;The Company anticipates paying the following officer salaries in 2001,
subject to the Company generating sufficient revenues and/or raising sufficient
capital to pay the same: Edmond Buccellato and Dr.&nbsp;Simon Skurkovich $120,000,
and $80,000 respectively, prorated for any shorter employment period.
</FONT>
<P align="center"><FONT size="2">Page 7 of 24
</FONT></DIV>

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<P><HR noshade><P>
<H5 align="left" style="page-break-before:always"><A HREF="#toc">Table of Contents</A></H5><P>
<P><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;There are no retirement, pension, or profit sharing plans for the benefit
of the Company&#146;s officers and directors.
</FONT>
<P align="center"><FONT size="2"><B>Option/SAR Grants</B></FONT>

<P><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;During the fiscal year ended December&nbsp;31, 2000, the Company did not grant
any stock options or stock appreciation rights to any executive officers.
</FONT>
<P align="center"><FONT size="2"><B>AGGREGATED OPTIONS/SAR EXERCISES IN FISCAL YEAR<BR>
ENDED DECEMBER 31, 2000 AND DECEMBER 31, 2000<BR>
OPTION/SAR VALUES</B></FONT>

<CENTER>
<TABLE cellspacing="0" border="0" cellpadding="0" width="95%">
<TR valign="bottom">
        <TD width="45%">&nbsp;</TD>
        <TD width="5%">&nbsp;</TD>
        <TD width="1%">&nbsp;</TD>
        <TD width="1%">&nbsp;</TD>
        <TD width="1%">&nbsp;</TD>
        <TD width="5%">&nbsp;</TD>
        <TD width="1%">&nbsp;</TD>
        <TD width="1%">&nbsp;</TD>
        <TD width="1%">&nbsp;</TD>
        <TD width="5%">&nbsp;</TD>
        <TD width="6%">&nbsp;</TD>
        <TD width="1%">&nbsp;</TD>
        <TD width="6%">&nbsp;</TD>
        <TD width="5%">&nbsp;</TD>
        <TD width="7%">&nbsp;</TD>
        <TD width="1%">&nbsp;</TD>
        <TD width="8%">&nbsp;</TD>
</TR>
<TR valign="bottom">
        <TD><FONT size="1">&nbsp;</FONT></TD>
        <TD><FONT size="1">&nbsp;</FONT></TD>
        <TD><FONT size="1">&nbsp;</FONT></TD>
        <TD><FONT size="1">&nbsp;</FONT></TD>
        <TD><FONT size="1">&nbsp;</FONT></TD>
        <TD><FONT size="1">&nbsp;</FONT></TD>
        <TD><FONT size="1">&nbsp;</FONT></TD>
        <TD><FONT size="1">&nbsp;</FONT></TD>
        <TD><FONT size="1">&nbsp;</FONT></TD>
        <TD><FONT size="1">&nbsp;</FONT></TD>
        <TD><FONT size="1">&nbsp;</FONT></TD>
        <TD><FONT size="1">&nbsp;</FONT></TD>
        <TD><FONT size="1">&nbsp;</FONT></TD>
        <TD><FONT size="1">&nbsp;</FONT></TD>
        <TD nowrap align="center" colspan="3"><FONT size="1"><B>Value of</B></FONT></TD>
</TR>
<TR valign="bottom">
        <TD><FONT size="1">&nbsp;</FONT></TD>
        <TD><FONT size="1">&nbsp;</FONT></TD>
        <TD><FONT size="1">&nbsp;</FONT></TD>
        <TD><FONT size="1">&nbsp;</FONT></TD>
        <TD><FONT size="1">&nbsp;</FONT></TD>
        <TD><FONT size="1">&nbsp;</FONT></TD>
        <TD><FONT size="1">&nbsp;</FONT></TD>
        <TD><FONT size="1">&nbsp;</FONT></TD>
        <TD><FONT size="1">&nbsp;</FONT></TD>
        <TD><FONT size="1">&nbsp;</FONT></TD>
        <TD><FONT size="1">&nbsp;</FONT></TD>
        <TD><FONT size="1">&nbsp;</FONT></TD>
        <TD><FONT size="1">&nbsp;</FONT></TD>
        <TD><FONT size="1">&nbsp;</FONT></TD>
        <TD nowrap align="center" colspan="3"><FONT size="1"><B>Unexercised In-The-Money</B></FONT></TD>
</TR>
<TR valign="bottom">
        <TD><FONT size="1">&nbsp;</FONT></TD>
        <TD><FONT size="1">&nbsp;</FONT></TD>
        <TD><FONT size="1">&nbsp;</FONT></TD>
        <TD><FONT size="1">&nbsp;</FONT></TD>
        <TD><FONT size="1">&nbsp;</FONT></TD>
        <TD><FONT size="1">&nbsp;</FONT></TD>
        <TD><FONT size="1">&nbsp;</FONT></TD>
        <TD><FONT size="1">&nbsp;</FONT></TD>
        <TD><FONT size="1">&nbsp;</FONT></TD>
        <TD><FONT size="1">&nbsp;</FONT></TD>
        <TD nowrap align="center" colspan="3"><FONT size="1"><B>Number of Unexercised</B></FONT></TD>
        <TD><FONT size="1">&nbsp;</FONT></TD>
        <TD nowrap align="center" colspan="3"><FONT size="1"><B>Options/SARs At</B></FONT></TD>
</TR>
<TR valign="bottom">
        <TD><FONT size="1">&nbsp;</FONT></TD>
        <TD><FONT size="1">&nbsp;</FONT></TD>
        <TD nowrap align="center" colspan="3"><FONT size="1"><B>Shares</B></FONT></TD>
        <TD><FONT size="1">&nbsp;</FONT></TD>
        <TD><FONT size="1">&nbsp;</FONT></TD>
        <TD><FONT size="1">&nbsp;</FONT></TD>
        <TD><FONT size="1">&nbsp;</FONT></TD>
        <TD><FONT size="1">&nbsp;</FONT></TD>
        <TD nowrap align="center" colspan="3"><FONT size="1"><B>Securities Underlying</B></FONT></TD>
        <TD><FONT size="1">&nbsp;</FONT></TD>
        <TD nowrap align="center" colspan="3"><FONT size="1"><B>FY-End ($)</B></FONT></TD>
</TR>
<TR valign="bottom">
        <TD><FONT size="1">&nbsp;</FONT></TD>
        <TD><FONT size="1">&nbsp;</FONT></TD>
        <TD nowrap align="center" colspan="3"><FONT size="1"><B>Acquired on</B></FONT></TD>
        <TD><FONT size="1">&nbsp;</FONT></TD>
        <TD nowrap align="center" colspan="3"><FONT size="1"><B>Value</B></FONT></TD>
        <TD><FONT size="1">&nbsp;</FONT></TD>
        <TD nowrap align="center" colspan="3"><FONT size="1"><B>Options/SARs at FY-End(#)</B></FONT></TD>
        <TD><FONT size="1">&nbsp;</FONT></TD>
        <TD nowrap align="center" colspan="3"><FONT size="1"><B>Exercisable/</B></FONT></TD>
</TR>
<TR valign="bottom">
        <TD nowrap align="center"><FONT size="1"><B>Name</B></FONT></TD>
        <TD><FONT size="1">&nbsp;</FONT></TD>
        <TD nowrap align="center" colspan="3"><FONT size="1"><B>Exercise (#)</B></FONT></TD>
        <TD><FONT size="1">&nbsp;</FONT></TD>
        <TD nowrap align="center" colspan="3"><FONT size="1"><B>Realized ($)</B></FONT></TD>
        <TD><FONT size="1">&nbsp;</FONT></TD>

<TD nowrap align="center" colspan="3"><FONT size="1"><B>Exercisable/Unexercisable(1)</B></FONT></TD>
        <TD><FONT size="1">&nbsp;</FONT></TD>

<TD nowrap align="center" colspan="3"><FONT size="1"><B>Unexercisable(2)</B></FONT></TD>
</TR>
<TR valign="bottom">
        <TD nowrap align="center"><HR size="1" noshade></TD>
        <TD><FONT size="1">&nbsp;</FONT></TD>
        <TD colspan="3"><HR size="1" noshade></TD>
        <TD><FONT size="1">&nbsp;</FONT></TD>
        <TD colspan="3"><HR size="1" noshade></TD>
        <TD><FONT size="1">&nbsp;</FONT></TD>
        <TD colspan="3"><HR size="1" noshade></TD>
        <TD><FONT size="1">&nbsp;</FONT></TD>
        <TD colspan="3"><HR size="1" noshade></TD>
</TR>
<TR valign="bottom">
        <TD><DIV style="margin-left:10px; text-indent:-10px"><FONT size="2">Simon Skurkovich</FONT></DIV></TD>
        <TD><FONT size="2">&nbsp;</FONT></TD>
        <TD><FONT size="2">&nbsp;</FONT></TD>
        <TD align="right"><FONT size="2">0</FONT></TD>
        <TD><FONT size="2">&nbsp;</FONT></TD>
        <TD><FONT size="2">&nbsp;</FONT></TD>
        <TD align="right"><FONT size="2">$</FONT></TD>
        <TD align="right"><FONT size="2">0</FONT></TD>
        <TD><FONT size="2">&nbsp;</FONT></TD>
        <TD><FONT size="2">&nbsp;</FONT></TD>
        <TD><FONT size="2">&nbsp;</FONT></TD>
        <TD align="right"><FONT size="2">300,000</FONT></TD>
        <TD><FONT size="2">&nbsp;</FONT></TD>
        <TD><FONT size="2">&nbsp;</FONT></TD>
        <TD align="right"><FONT size="2">$</FONT></TD>
        <TD align="right"><FONT size="2">48,000</FONT></TD>
        <TD><FONT size="2">&nbsp;</FONT></TD>
</TR>

<TR valign="bottom">
        <TD><DIV style="margin-left:10px; text-indent:-10px"><FONT size="2">&nbsp;</FONT></DIV></TD>
        <TD><FONT size="2">&nbsp;</FONT></TD>
        <TD><FONT size="2">&nbsp;</FONT></TD>
        <TD><FONT size="2">&nbsp;</FONT></TD>
        <TD><FONT size="2">&nbsp;</FONT></TD>
        <TD><FONT size="2">&nbsp;</FONT></TD>
        <TD><FONT size="2">&nbsp;</FONT></TD>
        <TD><FONT size="2">&nbsp;</FONT></TD>
        <TD><FONT size="2">&nbsp;</FONT></TD>
        <TD><FONT size="2">&nbsp;</FONT></TD>
        <TD><FONT size="2">&nbsp;</FONT></TD>
        <TD align="right"><FONT size="2">623,000</FONT></TD>
        <TD><FONT size="2">&nbsp;</FONT></TD>
        <TD><FONT size="2">&nbsp;</FONT></TD>
        <TD align="right"><FONT size="2">$</FONT></TD>
        <TD align="right"><FONT size="2">99,680</FONT></TD>
        <TD><FONT size="2">&nbsp;</FONT></TD>
</TR>

<TR valign="bottom">
        <TD><DIV style="margin-left:10px; text-indent:-10px"><FONT size="2">Edmond Buccellato</FONT></DIV></TD>
        <TD><FONT size="2">&nbsp;</FONT></TD>
        <TD><FONT size="2">&nbsp;</FONT></TD>
        <TD align="right"><FONT size="2">0</FONT></TD>
        <TD><FONT size="2">&nbsp;</FONT></TD>
        <TD><FONT size="2">&nbsp;</FONT></TD>
        <TD align="right"><FONT size="2">$</FONT></TD>
        <TD align="right"><FONT size="2">0</FONT></TD>
        <TD><FONT size="2">&nbsp;</FONT></TD>
        <TD><FONT size="2">&nbsp;</FONT></TD>
        <TD><FONT size="2">&nbsp;</FONT></TD>
        <TD align="right"><FONT size="2">105,543</FONT></TD>
        <TD><FONT size="2">&nbsp;</FONT></TD>
        <TD><FONT size="2">&nbsp;</FONT></TD>
        <TD align="right"><FONT size="2">$</FONT></TD>
        <TD align="right"><FONT size="2">16,887</FONT></TD>
        <TD><FONT size="2">&nbsp;</FONT></TD>
</TR>

<TR valign="bottom">
        <TD><DIV style="margin-left:10px; text-indent:-10px"><FONT size="2">&nbsp;</FONT></DIV></TD>
        <TD><FONT size="2">&nbsp;</FONT></TD>
        <TD><FONT size="2">&nbsp;</FONT></TD>
        <TD><FONT size="2">&nbsp;</FONT></TD>
        <TD><FONT size="2">&nbsp;</FONT></TD>
        <TD><FONT size="2">&nbsp;</FONT></TD>
        <TD><FONT size="2">&nbsp;</FONT></TD>
        <TD><FONT size="2">&nbsp;</FONT></TD>
        <TD><FONT size="2">&nbsp;</FONT></TD>
        <TD><FONT size="2">&nbsp;</FONT></TD>
        <TD><FONT size="2">&nbsp;</FONT></TD>
        <TD align="right"><FONT size="2">50,000</FONT></TD>
        <TD><FONT size="2">&nbsp;</FONT></TD>
        <TD><FONT size="2">&nbsp;</FONT></TD>
        <TD align="right"><FONT size="2">$</FONT></TD>
        <TD align="right"><FONT size="2">8,000</FONT></TD>
        <TD><FONT size="2">&nbsp;</FONT></TD>
</TR>


<TR valign="bottom">
        <TD><DIV style="margin-left:10px; text-indent:-10px"><FONT size="2">&nbsp;</FONT></DIV></TD>
        <TD><FONT size="2">&nbsp;</FONT></TD>
        <TD><FONT size="2">&nbsp;</FONT></TD>
        <TD><FONT size="2">&nbsp;</FONT></TD>
        <TD><FONT size="2">&nbsp;</FONT></TD>
        <TD><FONT size="2">&nbsp;</FONT></TD>
        <TD><FONT size="2">&nbsp;</FONT></TD>
        <TD><FONT size="2">&nbsp;</FONT></TD>
        <TD><FONT size="2">&nbsp;</FONT></TD>
        <TD><FONT size="2">&nbsp;</FONT></TD>
        <TD><FONT size="2">&nbsp;</FONT></TD>
        <TD align="right"><FONT size="2">50,000</FONT></TD>
        <TD><FONT size="2">&nbsp;</FONT></TD>
        <TD><FONT size="2">&nbsp;</FONT></TD>
        <TD align="right"><FONT size="2">$</FONT></TD>
        <TD align="right"><FONT size="2">3,000</FONT></TD>
        <TD><FONT size="2">&nbsp;</FONT></TD>
</TR>

<TR valign="bottom">
        <TD><DIV style="margin-left:10px; text-indent:-10px"><FONT size="2">Jeanne Kelly</FONT></DIV></TD>
        <TD><FONT size="2">&nbsp;</FONT></TD>
        <TD><FONT size="2">&nbsp;</FONT></TD>
        <TD align="right"><FONT size="2">0</FONT></TD>
        <TD><FONT size="2">&nbsp;</FONT></TD>
        <TD><FONT size="2">&nbsp;</FONT></TD>
        <TD align="right"><FONT size="2">$</FONT></TD>
        <TD align="right"><FONT size="2">0</FONT></TD>
        <TD><FONT size="2">&nbsp;</FONT></TD>
        <TD><FONT size="2">&nbsp;</FONT></TD>
        <TD><FONT size="2">&nbsp;</FONT></TD>
        <TD align="right"><FONT size="2">150,000</FONT></TD>
        <TD><FONT size="2">&nbsp;</FONT></TD>
        <TD><FONT size="2">&nbsp;</FONT></TD>
        <TD align="right"><FONT size="2">$</FONT></TD>
        <TD align="right"><FONT size="2">9,000</FONT></TD>
        <TD><FONT size="2">&nbsp;</FONT></TD>
</TR>

<TR valign="bottom">
        <TD><DIV style="margin-left:10px; text-indent:-10px"><FONT size="2">(former</FONT></DIV></TD>
        <TD><FONT size="2">&nbsp;</FONT></TD>
        <TD><FONT size="2">&nbsp;</FONT></TD>
        <TD><FONT size="2">&nbsp;</FONT></TD>
        <TD><FONT size="2">&nbsp;</FONT></TD>
        <TD><FONT size="2">&nbsp;</FONT></TD>
        <TD><FONT size="2">&nbsp;</FONT></TD>
        <TD><FONT size="2">&nbsp;</FONT></TD>
        <TD><FONT size="2">&nbsp;</FONT></TD>
        <TD><FONT size="2">&nbsp;</FONT></TD>
        <TD><FONT size="2">&nbsp;</FONT></TD>
        <TD align="right"><FONT size="2">150,000</FONT></TD>
        <TD><FONT size="2">&nbsp;</FONT></TD>
        <TD><FONT size="2">&nbsp;</FONT></TD>
        <TD align="right"><FONT size="2">$</FONT></TD>
        <TD align="right"><FONT size="2">37,500</FONT></TD>
        <TD><FONT size="2">&nbsp;</FONT></TD>
</TR>

<TR valign="bottom">
        <TD><DIV style="margin-left:10px; text-indent:-10px"><FONT size="2">Secretary/Treasurer)</FONT></DIV></TD>
        <TD><FONT size="2">&nbsp;</FONT></TD>
        <TD><FONT size="2">&nbsp;</FONT></TD>
        <TD><FONT size="2">&nbsp;</FONT></TD>
        <TD><FONT size="2">&nbsp;</FONT></TD>
        <TD><FONT size="2">&nbsp;</FONT></TD>
        <TD><FONT size="2">&nbsp;</FONT></TD>
        <TD><FONT size="2">&nbsp;</FONT></TD>
        <TD><FONT size="2">&nbsp;</FONT></TD>
        <TD><FONT size="2">&nbsp;</FONT></TD>
        <TD><FONT size="2">&nbsp;</FONT></TD>
        <TD align="right"><FONT size="2">50,000</FONT></TD>
        <TD><FONT size="2">&nbsp;</FONT></TD>
        <TD><FONT size="2">&nbsp;</FONT></TD>
        <TD align="right"><FONT size="2">$</FONT></TD>
        <TD align="right"><FONT size="2">3,000</FONT></TD>
        <TD><FONT size="2">&nbsp;</FONT></TD>
</TR>

<TR valign="bottom">
        <TD><DIV style="margin-left:10px; text-indent:-10px"><FONT size="2">&nbsp;</FONT></DIV></TD>
        <TD><FONT size="2">&nbsp;</FONT></TD>
        <TD><FONT size="2">&nbsp;</FONT></TD>
        <TD><FONT size="2">&nbsp;</FONT></TD>
        <TD><FONT size="2">&nbsp;</FONT></TD>
        <TD><FONT size="2">&nbsp;</FONT></TD>
        <TD><FONT size="2">&nbsp;</FONT></TD>
        <TD><FONT size="2">&nbsp;</FONT></TD>
        <TD><FONT size="2">&nbsp;</FONT></TD>
        <TD><FONT size="2">&nbsp;</FONT></TD>
        <TD><FONT size="2">&nbsp;</FONT></TD>
        <TD align="right"><FONT size="2">100,000</FONT></TD>
        <TD><FONT size="2">&nbsp;</FONT></TD>
        <TD><FONT size="2">&nbsp;</FONT></TD>
        <TD align="right"><FONT size="2">$</FONT></TD>
        <TD align="right"><FONT size="2">16,000</FONT></TD>
        <TD><FONT size="2">&nbsp;</FONT></TD>
</TR>

<TR valign="bottom">
        <TD><DIV style="margin-left:10px; text-indent:-10px"><FONT size="2">&nbsp;</FONT></DIV></TD>
        <TD><FONT size="2">&nbsp;</FONT></TD>
        <TD><FONT size="2">&nbsp;</FONT></TD>
        <TD><FONT size="2">&nbsp;</FONT></TD>
        <TD><FONT size="2">&nbsp;</FONT></TD>
        <TD><FONT size="2">&nbsp;</FONT></TD>
        <TD><FONT size="2">&nbsp;</FONT></TD>
        <TD><FONT size="2">&nbsp;</FONT></TD>
        <TD><FONT size="2">&nbsp;</FONT></TD>
        <TD><FONT size="2">&nbsp;</FONT></TD>
        <TD><FONT size="2">&nbsp;</FONT></TD>
        <TD align="right"><FONT size="2">114,500</FONT></TD>
        <TD><FONT size="2">&nbsp;</FONT></TD>
        <TD><FONT size="2">&nbsp;</FONT></TD>
        <TD align="right"><FONT size="2">$</FONT></TD>
        <TD align="right"><FONT size="2">18,320</FONT></TD>
        <TD><FONT size="2">&nbsp;</FONT></TD>
</TR>
</TABLE>
</CENTER>


<P>
<TABLE width="100%" border="0" cellpadding="0" cellspacing="0">
<TR valign="top">
      <TD width="1%" align="left" nowrap><FONT size="2">(1)</FONT></TD>
        <TD width="3%"><FONT size="2">&nbsp;</FONT></TD>
        <TD width="96%"><FONT size="2">All options were exercisable
as of December&nbsp;31, 2000</FONT></TD>
</TR>
</TABLE>

<P>
<TABLE width="100%" border="0" cellpadding="0" cellspacing="0">
<TR valign="top">
      <TD width="1%" align="left" nowrap><FONT size="2">(2)</FONT></TD>
        <TD width="3%"><FONT size="2">&nbsp;</FONT></TD>
        <TD width="96%"><FONT size="2">Determined on the basis of the
share closing price of $0.26 on
December&nbsp;28, 2000</FONT></TD>
</TR>
</TABLE>


<P align="left"><FONT size="2"><B>Long-Term Incentive Plan Awards</B></FONT>

<P><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;The Company adopted a Stock Bonus Plan (&#147;Stock Bonus Plan&#148;) in January
2000. The purpose of the Stock Bonus Plan is to keep personnel of experience
and ability in the employ of the Company and to compensate them for their
contributions to the growth of the Company. In December 2000, the Board of
Directors approved the Company&#146;s 2000 Omnibus Equity Incentive Plan (&#147;OEI
Plan&#148;) and reserved 4,000,000 shares of Common Stock to be issued thereunder to
employees, consultants and directors, subject to annual increases equal to the
lesser of 2.5% of the then outstanding shares of Common Stock or 250,000
shares. No shares or options have been granted under the OEI plan to date.
</FONT>
<P align="center"><FONT size="2">Page 8 of 24
</FONT>

<!-- PAGEBREAK -->
<P><HR noshade><P>
<H5 align="left" style="page-break-before:always"><A HREF="#toc">Table of Contents</A></H5><P>
<P align="left"><FONT size="2"><B>Compensation of Directors</B></FONT>

<P><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Directors did not receive any compensation for serving as members of the
Board of Directors for the year ended December&nbsp;31, 2000, except as provided
below. The Board has not implemented a plan to award options or shares to any
Directors, except pursuant to the Stock Bonus Plan and the OEI Plan. Under the
Stock Bonus Plan, certain directors and officers were awarded, in the
aggregate, 9,200,000 shares of the Company&#146;s Common Stock at a price of $0.05
per share. The awards were made on January&nbsp;11, 2000. Such stock bonuses were
issued at the weighted average price at which the Company had been selling
shares of Common Stock to third parties during the six months immediately
preceding the issuance of the bonus shares, or $0.05 per share. Consideration
for the purchase of such shares was in the form of a note in favor of the
Company issued by each director and officer to whom the shares of Common Stock
were awarded. In addition, during the year ended December&nbsp;31, 2000, the
Company granted warrants to former director Paul J. Marangos and directors
Alexander L. Cappello and John M. Bendheim, each to purchase 100,000 shares of
Common Stock at an exercise price of $0.25 per share (for a total of 300,000
warrant shares) for their respective service on the Board of Directors. In
April 2001, the Company granted warrants to Thomas J. Pernice to purchase
100,000 shares of Common Stock at an exercise price of $0.25 for his service on
the Board of Directors. There are no other contractual arrangements with any
member of the Board of Directors, except as set forth in this Proxy Statement.
See &#147;Certain Relationships and Related Transactions&#148; below.
</FONT>
<P align="left"><FONT size="2"><B>Board Committees and Meetings</B></FONT>

<P><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;During the fiscal year ended December&nbsp;31, 2000, the Board of Directors
held 6&nbsp;meetings (including special meetings), and each incumbent director
attended at least 75% of such meetings. During the current fiscal year ending
December&nbsp;31, 2001, the board established an Audit Committee, Compensation
Committee and Executive Committee. Board members receive no compensation for
attendance at meetings except reimbursement of expenses. The Board at large
serves as the Nominating Committee.
</FONT>
<P align="left"><FONT size="2"><B>Audit Committee</B></FONT>

<P><FONT size="2">The Board of Directors has adopted a written charter for the Audit Committee, a
copy of which is attached as <U>Appendix&nbsp;B</U> hereto.
</FONT>
<P align="left"><FONT size="2"><B>Report of the Audit Committee</B></FONT>

<P><FONT size="2">The Audit Committee of the Board of Directors oversees the Company&#146;s financial
reporting process on behalf of the Board of Directors. It meets with
management and the Company&#146;s independent public accountants and reports the
results of its activities to the Board of Directors. In this connection, the
Audit Committee has done the following:
</FONT>
<P align="center"><FONT size="2">Page 9 of 24
</FONT>

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<P><HR noshade><P>
<H5 align="left" style="page-break-before:always"><A HREF="#toc">Table of Contents</A></H5><P>
<P>
<TABLE width="100%" border="0" cellpadding="0" cellspacing="0">
<TR valign="top">
   <TD width="1%" nowrap><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;</FONT></TD>
   <TD width="1%" align="left"><FONT size="2">&#149;</FONT></TD>
   <TD width="1%" nowrap><FONT size="2">&nbsp;&nbsp;</FONT></TD>
   <TD width="97%"><FONT size="2">Reviewed and discussed the audited financial statements for the fiscal
year ended December&nbsp;31, 2000, with the Company&#146;s management and the independent
auditors;</FONT></TD>
</TR>
<TR>
        <TD><FONT size="2">&nbsp;</FONT></TD>
</TR>
<TR valign="top">
   <TD width="1%" nowrap><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;</FONT></TD>
   <TD width="1%" align="left"><FONT size="2">&#149;</FONT></TD>
   <TD width="1%" nowrap><FONT size="2">&nbsp;&nbsp;</FONT></TD>
   <TD width="97%"><FONT size="2">Discussed with Williams &#038; Webster, P.S., the Company&#146;s independent
accountants, the matters required to be discussed by Statement on Auditing
Standards No.&nbsp;61 (Codification of Statements on Auditing Standards), as
amended; and</FONT></TD>
</TR>
<TR>
        <TD><FONT size="2">&nbsp;</FONT></TD>
</TR>
<TR valign="top">
   <TD width="1%" nowrap><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;</FONT></TD>
   <TD width="1%" align="left"><FONT size="2">&#149;</FONT></TD>
   <TD width="1%" nowrap><FONT size="2">&nbsp;&nbsp;</FONT></TD>
   <TD width="97%"><FONT size="2">Received written disclosure regarding independence from Williams &#038;
Webster, P.S. as required by Independent Standards Board Standard No.&nbsp;1
(Independence Discussions with Audit Committees) and discussed with Williams &#038;
Webster, P.S. its independence.</FONT></TD>
</TR>
</TABLE>
<P><FONT size="2">Based on the foregoing, the Audit Committee recommended to the Board of
Directors that the audited financial statements be included in the Company&#146;s
Annual Report on Form&nbsp;10-KSB for the year ended December&nbsp;31, 2000 (&#147;Annual
Report&#148;).
</FONT>
<P><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;As of the filing of the Company&#146;s Annual Report, Alexander L. Cappello,
Edmond F. Buccellato and John M. Bendheim served on the Company&#146;s Audit
Committee.
</FONT>
<P><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;As of the date of this Proxy Statement, the Audit Committee consists of
Alexander L. Cappello, John M. Bendheim, Leonard Millstein and Thomas J.
Pernice.
</FONT>
<P align="left"><FONT size="2"><B>Certain Relationships and Related Transactions</B></FONT>

<P><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;The Company is currently indebted to Simon Skurkovich, M.D., the Company&#146;s
Chairman Emeritus of the Board of Directors, and Director of Research and
Development in the amount of $127,631.
</FONT>
<P><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;The Company receives the use of approximately 3,500 square feet of
commercial building space on a rent-free basis from a company owned by Lawrence
Loomis. The Company receives use of office space on a rent-free basis from
Buccellato &#038; Finkelstein, Inc., of which Edmond F. Buccellato is a shareholder.
</FONT>
<P><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Alexander L. Cappello is the brother of Gerard K. Cappello, the sole
shareholder, president and chief executive officer of Cappello Capital Corp.
which was retained by the Company in January, 2000 to render financial advisory
and investment banking services and thereupon was granted warrants to purchase
4,685,135 shares of Common Stock at $0.15 per share. Such warrants have been
assigned to certain individuals, including Alexander L. Cappello. Cappello
Capital Corp. raised $1,510,500 in convertible subordinated debt for the
Company, was paid $124,981 in fees and expenses related thereto, and was
granted an option to purchase $151,050 principal amount of
</FONT>
<P align="center"><FONT size="2">Page 10 of 24
</FONT>

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<P><FONT size="2">Convertible Debt at
par. Thomas J. Pernice is an officer of Cappello Group, Inc., a merchant
banking firm, which is owned by Alexander L. Cappello.
</FONT>
<P><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Alexander L. Cappello, John M. Bendheim and Thomas J. Pernice, each
beneficially own the Company&#146;s Convertible Debt, upon which the Company is
indebted to such individuals.
</FONT>
<P><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;The following directors and officers are indebted to the Company in the
amount set forth opposite his name, respectively, in connection with the grant
of shares of Common Stock pursuant to the Company&#146;s Stock Bonus Plan:
</FONT>
<CENTER>
<TABLE cellspacing="0" border="0" cellpadding="0" width="55%">
<TR valign="bottom">
        <TD width="75%">&nbsp;</TD>
        <TD width="5%">&nbsp;</TD>
        <TD width="9%">&nbsp;</TD>
        <TD width="1%">&nbsp;</TD>
        <TD width="10%">&nbsp;</TD>
</TR>
<TR valign="bottom">
        <TD><DIV style="margin-left:10px; text-indent:-10px"><FONT size="2">Edmond F. Buccellato:</FONT></DIV></TD>
        <TD><FONT size="2">&nbsp;</FONT></TD>
        <TD align="right"><FONT size="2">$</FONT></TD>
        <TD align="right"><FONT size="2">75,000</FONT></TD>
        <TD><FONT size="2">&nbsp;</FONT></TD>
</TR>

<TR valign="bottom">
        <TD><DIV style="margin-left:10px; text-indent:-10px"><FONT size="2">Boris Skurkovich, M.D.:</FONT></DIV></TD>
        <TD><FONT size="2">&nbsp;</FONT></TD>
        <TD align="right"><FONT size="2">$</FONT></TD>
        <TD align="right"><FONT size="2">75,000</FONT></TD>
        <TD><FONT size="2">&nbsp;</FONT></TD>
</TR>

<TR valign="bottom">
        <TD><DIV style="margin-left:10px; text-indent:-10px"><FONT size="2">Lawrence Loomis:</FONT></DIV></TD>
        <TD><FONT size="2">&nbsp;</FONT></TD>
        <TD align="right"><FONT size="2">$</FONT></TD>
        <TD align="right"><FONT size="2">50,000</FONT></TD>
        <TD><FONT size="2">&nbsp;</FONT></TD>
</TR>
</TABLE>
</CENTER>
<P><FONT size="2">The same three individuals each issued a promissory note in favor of the
Company evidencing such obligations, which notes mature on December&nbsp;31, 2002,
and bear interest at 6.5% per annum.
</FONT>
<P align="left"><FONT size="2"><B>Family Relationships</B></FONT>

<P><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;The only relationship between any directors or officers known to the
Company is that Simon Skurkovich is father to Boris Skurkovich, and
father-in-law to Leonard Millstein.
</FONT>
<P align="left"><FONT size="2"><B>Involvement In Certain Legal Proceedings</B></FONT>

<P><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;During the past five years, to the knowledge of the Company, no present or
former director, executive officer or person nominated to become a director or
an executive officer of the Company has been the subject matter of any legal
proceedings, including bankruptcy, criminal proceedings, or civil proceedings.
Further, no legal proceedings are known to be contemplated by governmental
authorities against any director, executive officer and person nominated to
become a director.
</FONT>
<P align="left"><FONT size="2"><B>Interests of Certain Persons In Matters to Be Acted Upon</B></FONT>

<P><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;No director or officer, past or present, or any associate or affiliate of
such persons, or any person on behalf of whom this solicitation is made, has
any interest, direct or indirect, in any matter to be acted upon at the Annual
Meeting, except insofar as disclosed in this Proxy Statement and the materials
incorporated by reference herein.
</FONT>
<P align="center"><FONT size="2">Page 11 of 24
</FONT>

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<P align="left"><FONT size="2"><B>Compliance with Section&nbsp;16(a) of the Exchange Act</B></FONT>

<P><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;In connection with the receipt of one or more gifts of Company Common
Stock, Dr.&nbsp;Boris Skurkovich and Leonard Millstein are not current in their
respective filing of reports required by Section&nbsp;16(a) of the Securities
Exchange Act of 1934, as amended. A
Form&nbsp;5 was required to be filed by Dr.&nbsp;Simon Skurkovich relating to his gift of
4,000,000 shares to various individuals and has not been filed yet.
</FONT>
<P align="center"><FONT size="2"><B>PROPOSAL NO. 1</B></FONT>

<P align="center"><FONT size="2"><B>ELECTION OF DIRECTORS</B></FONT>

<P><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;In accordance with the Company&#146;s Bylaws for the purpose of the election,
the Board of Directors has fixed the number of directors constituting the Board
at eight (8)&nbsp;as of the date of the Annual Meeting. There are currently eight
(8)&nbsp;Directors. The Board of Directors has proposed that the following eight
(8)&nbsp;nominees be elected at the Annual Meeting, each of whom will hold office
until his successor shall have been elected and qualified: Simon Skurkovich,
M.D., Edmond Buccellato, Boris Skurkovich, M.D., Lawrence Loomis, Leonard
Millstein, Alexander L. Cappello, John M. Bendheim and Thomas J. Pernice.
Unless otherwise instructed, it is the intention of the persons named as
proxies on the Company proxy card to vote shares represented by properly
executed proxies for the election of such nominees. Although the Board of
Directors anticipates that the eight (8)&nbsp;nominees will be available to serve as
directors of the Company, if any of them should be unwilling or unable to
serve, it is intended that the proxies will be voted for the election of such
substitute nominee or nominees as may be designated by the Board of Directors.
Each person nominated for election has agreed to serve if elected.
</FONT>
<P align="left"><FONT size="2"><B>Nominees for the Board of Directors</B></FONT>

<P><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Each of the current directors of the Company is listed below:
</FONT>
<CENTER>
<TABLE cellspacing="0" border="0" cellpadding="0" width="95%">
<TR valign="bottom">
        <TD width="28%">&nbsp;</TD>
        <TD width="3%">&nbsp;</TD>
        <TD width="1%">&nbsp;</TD>
        <TD width="1%">&nbsp;</TD>
        <TD width="1%">&nbsp;</TD>
        <TD width="3%">&nbsp;</TD>
        <TD width="45%">&nbsp;</TD>
        <TD width="3%">&nbsp;</TD>
        <TD width="15%">&nbsp;</TD>
</TR>
<TR valign="bottom">
        <TD nowrap align="center"><FONT size="1"><B>Name</B></FONT></TD>
        <TD><FONT size="1">&nbsp;</FONT></TD>
        <TD nowrap align="center" colspan="3"><FONT size="1"><B>Age</B></FONT></TD>
        <TD><FONT size="1">&nbsp;</FONT></TD>
        <TD nowrap align="center"><FONT size="1"><B>Position Held</B></FONT></TD>
        <TD><FONT size="1">&nbsp;</FONT></TD>
        <TD nowrap align="center"><FONT size="1"><B>Director Since</B></FONT></TD>
</TR>
<TR valign="bottom">
        <TD nowrap align="center"><HR size="1" noshade></TD>
        <TD><FONT size="1">&nbsp;</FONT></TD>
        <TD colspan="3"><HR size="1" noshade></TD>
        <TD><FONT size="1">&nbsp;</FONT></TD>
        <TD nowrap align="center"><HR size="1" noshade></TD>
        <TD><FONT size="1">&nbsp;</FONT></TD>
        <TD nowrap align="center"><HR size="1" noshade></TD>
</TR>
<TR valign="bottom">
        <TD valign="top"><FONT size="2">Simon Skurkovich, M.D.</FONT></TD>
        <TD><FONT size="2">&nbsp;</FONT></TD>
        <TD nowrap align="right" valign="top"><FONT size="2">&nbsp;</FONT></TD>
        <TD align="right" valign="top"><FONT size="2">
78
</FONT></TD>
        <TD valign="top"><FONT size="2">&nbsp;</FONT></TD>
        <TD><FONT size="2">&nbsp;</FONT></TD>
        <TD align="left" valign="top"><FONT size="2">Chairman Emeritus, Director, and
Director of Research<BR>
&nbsp;&nbsp;and Development
</FONT></TD>
        <TD><FONT size="2">&nbsp;</FONT></TD>
        <TD align="RIGHT" valign="top"><FONT size="2">November, 1985</FONT></TD>
</TR>
<TR><TD><TR><TD><TR><TD><TR><TD>
<TR><TD><TR><TD><TR><TD><TR><TD>

<TR valign="bottom">
        <TD valign="top"><FONT size="2">Alexander L. Cappello</FONT></TD>
        <TD><FONT size="2">&nbsp;</FONT></TD>
        <TD nowrap align="right" valign="top"><FONT size="2">&nbsp;</FONT></TD>
        <TD align="right" valign="top"><FONT size="2">
45
</FONT></TD>
        <TD valign="top"><FONT size="2">&nbsp;</FONT></TD>
        <TD><FONT size="2">&nbsp;</FONT></TD>
        <TD align="left" valign="top"><FONT size="2">Chairman of the Board, Director (1)(2)(3)
</FONT></TD>
        <TD><FONT size="2">&nbsp;</FONT></TD>
        <TD align="RIGHT" valign="top"><FONT size="2">April, 2000</FONT></TD>
</TR>
<TR><TD><TR><TD><TR><TD><TR><TD>
<TR><TD><TR><TD><TR><TD><TR><TD>

<TR valign="bottom">
        <TD valign="top"><FONT size="2">Edmond F. Buccellato</FONT></TD>
        <TD><FONT size="2">&nbsp;</FONT></TD>
        <TD nowrap align="right" valign="top"><FONT size="2">&nbsp;</FONT></TD>
        <TD align="right" valign="top"><FONT size="2">
56
</FONT></TD>
        <TD valign="top"><FONT size="2">&nbsp;</FONT></TD>
        <TD><FONT size="2">&nbsp;</FONT></TD>
        <TD align="left" valign="top"><FONT size="2">President and Chief Executive Officer,
Director (3)
</FONT></TD>
        <TD><FONT size="2">&nbsp;</FONT></TD>
        <TD align="RIGHT" valign="top"><FONT size="2">November, 1995</FONT></TD>
</TR>
<TR><TD><TR><TD><TR><TD><TR><TD>
<TR><TD><TR><TD><TR><TD><TR><TD>

<TR valign="bottom">
        <TD valign="top"><FONT size="2">Thomas J. Pernice</FONT></TD>
        <TD><FONT size="2">&nbsp;</FONT></TD>
        <TD nowrap align="right" valign="top"><FONT size="2">&nbsp;</FONT></TD>
        <TD align="right" valign="top"><FONT size="2">
39
</FONT></TD>
        <TD valign="top"><FONT size="2">&nbsp;</FONT></TD>
        <TD><FONT size="2">&nbsp;</FONT></TD>
        <TD align="left" valign="top"><FONT size="2">Treasurer and Secretary, Director (3)
</FONT></TD>
        <TD><FONT size="2">&nbsp;</FONT></TD>
        <TD align="RIGHT" valign="top"><FONT size="2">April, 2001</FONT></TD>
</TR>
<TR><TD><TR><TD><TR><TD><TR><TD>
<TR><TD><TR><TD><TR><TD><TR><TD>

<TR valign="bottom">
        <TD valign="top"><FONT size="2">William M. Finkelstein</FONT></TD>
        <TD><FONT size="2">&nbsp;</FONT></TD>
        <TD nowrap align="right" valign="top"><FONT size="2">&nbsp;</FONT></TD>
        <TD align="right" valign="top"><FONT size="2">
42
</FONT></TD>
        <TD valign="top"><FONT size="2">&nbsp;</FONT></TD>
        <TD><FONT size="2">&nbsp;</FONT></TD>
        <TD align="left" valign="top"><FONT size="2">Chief Financial Officer
</FONT></TD>
        <TD><FONT size="2">&nbsp;</FONT></TD>
        <TD align="RIGHT" valign="top"><FONT size="2">Not Director</FONT></TD>
</TR>
<TR><TD><TR><TD><TR><TD><TR><TD>
<TR><TD><TR><TD><TR><TD><TR><TD>

<TR valign="bottom">
        <TD valign="top"><FONT size="2">Lawrence Loomis</FONT></TD>
        <TD><FONT size="2">&nbsp;</FONT></TD>
        <TD nowrap align="right" valign="top"><FONT size="2">&nbsp;</FONT></TD>
        <TD align="right" valign="top"><FONT size="2">
58
</FONT></TD>
        <TD valign="top"><FONT size="2">&nbsp;</FONT></TD>
        <TD><FONT size="2">&nbsp;</FONT></TD>
        <TD align="left" valign="top"><FONT size="2">Director (2)
</FONT></TD>
        <TD><FONT size="2">&nbsp;</FONT></TD>
        <TD align="RIGHT" valign="top"><FONT size="2">December, 1986</FONT></TD>
</TR>
<TR><TD><TR><TD><TR><TD><TR><TD>
<TR><TD><TR><TD><TR><TD><TR><TD>

<TR valign="bottom">
        <TD valign="top"><FONT size="2">Leonard Millstein</FONT></TD>
        <TD><FONT size="2">&nbsp;</FONT></TD>
        <TD nowrap align="right" valign="top"><FONT size="2">&nbsp;</FONT></TD>
        <TD align="right" valign="top"><FONT size="2">
59
</FONT></TD>
        <TD valign="top"><FONT size="2">&nbsp;</FONT></TD>
        <TD><FONT size="2">&nbsp;</FONT></TD>
        <TD align="left" valign="top"><FONT size="2">Director (1)
</FONT></TD>
        <TD><FONT size="2">&nbsp;</FONT></TD>
        <TD align="RIGHT" valign="top"><FONT size="2">December, 1986</FONT></TD>
</TR>
<TR><TD><TR><TD><TR><TD><TR><TD>
<TR><TD><TR><TD><TR><TD><TR><TD>

<TR valign="bottom">
        <TD valign="top"><FONT size="2">Boris Skurkovich, M.D.</FONT></TD>
        <TD><FONT size="2">&nbsp;</FONT></TD>
        <TD nowrap align="right" valign="top"><FONT size="2">&nbsp;</FONT></TD>
        <TD align="right" valign="top"><FONT size="2">
46
</FONT></TD>
        <TD valign="top"><FONT size="2">&nbsp;</FONT></TD>
        <TD><FONT size="2">&nbsp;</FONT></TD>
        <TD align="left" valign="top"><FONT size="2">Director (2)
</FONT></TD>
        <TD><FONT size="2">&nbsp;</FONT></TD>
        <TD align="RIGHT" valign="top"><FONT size="2">December, 1986</FONT></TD>
</TR>
<TR><TD><TR><TD><TR><TD><TR><TD>
<TR><TD><TR><TD><TR><TD><TR><TD>

<TR valign="bottom">
        <TD valign="top"><FONT size="2">John M. Bendheim</FONT></TD>
        <TD><FONT size="2">&nbsp;</FONT></TD>
        <TD nowrap align="right" valign="top"><FONT size="2">&nbsp;</FONT></TD>
        <TD align="right" valign="top"><FONT size="2">
47
</FONT></TD>
        <TD valign="top"><FONT size="2">&nbsp;</FONT></TD>
        <TD><FONT size="2">&nbsp;</FONT></TD>
        <TD align="left" valign="top"><FONT size="2">Director (1)(2)(3)
</FONT></TD>
        <TD><FONT size="2">&nbsp;</FONT></TD>
        <TD align="RIGHT" valign="top"><FONT size="2">June, 2000</FONT></TD>
</TR>
</TABLE>
</CENTER>

<P>
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<P align="center"><FONT size="2">Page 12 of 24
</FONT>

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<TABLE width="100%" border="0" cellpadding="0" cellspacing="0">
<TR valign="top">
      <TD width="1%" align="left" nowrap><FONT size="2">(1)</FONT></TD>
        <TD width="3%"><FONT size="2">&nbsp;</FONT></TD>
        <TD width="96%"><FONT size="2">Member of the Audit Committee of the Board of Directors.</FONT></TD>
</TR>
<TR><TD><TR><TD><TR><TD><TR><TD>
<TR valign="top">
      <TD width="1%" align="left" nowrap><FONT size="2">(2)</FONT></TD>
        <TD width="3%"><FONT size="2">&nbsp;</FONT></TD>
        <TD width="96%"><FONT size="2">Member of the Compensation Committee of the Board of Directors.</FONT></TD>
</TR>
<TR><TD><TR><TD><TR><TD><TR><TD>
<TR valign="top">
      <TD width="1%" align="left" nowrap><FONT size="2">(3)</FONT></TD>
        <TD width="3%"><FONT size="2">&nbsp;</FONT></TD>
        <TD width="96%"><FONT size="2">Member of the Executive Committee of the Board of Directors.</FONT></TD>
</TR>
</TABLE>
<P><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Set forth below is a brief biography of each nominee for the Board of
Directors.
</FONT>
<P><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<B>John M. Bendheim </B>- Since June 2000, Mr.&nbsp;Bendheim has served as a member of
the Board of Directors. Mr.&nbsp;Bendheim is Chairman of the Cedars-Sinai Medical
Center Board of Governors in Los Angeles, California and President of Bendheim
Enterprises, Inc., a real estate investment holding company. He received his
B.S. degree in Business Administration in 1975 and his M.B.A. in 1976 from the
University of Southern California.
</FONT>
<P><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<B>Edmond F. Buccellato </B>&#151; Since April, 2001, Mr.&nbsp;Buccellato has served as
President and Chief Executive Officer. Mr.&nbsp;Buccellato served as President and
Chief Operating Officer of the Company from September&nbsp;1, 2000 to December&nbsp;12,
2000. Mr.&nbsp;Buccellato served as Chief Executive Officer and a member of the
Board of Directors from 1995 to August&nbsp;31, 2000. He was co-founder, member of
the Board of Directors and Vice President of Finance of Phase Medical, Inc., an
infusion therapy company sold to Becton Dickinson in 1994. He was also
co-founder, member of the Board of Directors and Vice President of Finance of
Synergistic Systems, Inc., a company that became the largest medical billing
company in the western United States. He is also co-founder and member of the
Board of Directors of Polymer Safety, LLC, a manufacturer of synthetic medical
and industrial examination gloves and co-founder and member of the Board of
Directors of Physicians&#146; Choice LLC, a medical billing company. Mr.&nbsp;Buccellato
received his undergraduate degree From California State University at San
Diego, and his graduate degree from the University of Southern California.
</FONT>
<P><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<B>Alexander L. Cappello </B>&#151; Since April, 2001, Mr.&nbsp;Cappello has served as
Chairman of the Board. Since May 2000, Mr.&nbsp;Cappello has served as a member of
the Board of Directors. Mr.&nbsp;Cappello is Chairman and Chief Executive Officer of
Cappello Group, Inc., a merchant banking firm, facilitating equity and project
financing since 1975. Currently, he is a Member of the Board of Directors of
the following: Cappello Group, Inc., RAND Corporation (Center for Middle East
Public Policy), CytRx Corporation (NASDAQ), Independent Colleges of Southern
California (ICSC), USC Marshall School of Business Entrepreneur Advisory
Council, USC Advancement Council, USC Marshall School of Business
Advisory Board, Chairman of Catholic Big Brothers of Los Angeles, Chairman of the International
Board of the Young Presidents&#146; Organization for 2003-2004. He received his
B.S. Degree in finance (Order of the Palm) from the University of Southern
California in 1977.
</FONT>
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</FONT>

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<P><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Formerly, Mr.&nbsp;Cappello was a Member of the Board of Directors of the
following; Koo Koo Roo, Inc. (NASDAQ), Arcus Data Security, Inc. (NASDAQ),
Maritime Bank of California (OTC), Executive Publications, Inc., and The
Joffrey Foundation.
</FONT>
<P><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<B>Lawrence Loomis </B>- Since 1986, Mr.&nbsp;Loomis has served as a member of the
Board of Directors. Mr.&nbsp;Loomis is President and majority shareholder of New
Horizons Diagnostics, Inc., a company that develops bacteriological screening
methods, monoclonal antibodies for detection of various infectious disease
agents, and rapid bacterial and viral assay kits. Prior to founding New
Horizons Diagnostics, Inc. in 1980, Mr.&nbsp;Loomis was in charge of the Immunology
Department for BBL, a division of Becton Dickinson. Mr.&nbsp;Loomis received his
undergraduate degree in Chemistry from New York University and his graduate
degree in Chemistry from City University.
</FONT>
<P><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<B>Leonard Millstein </B>- Since 1986, Mr.&nbsp;Millstein has served as a member of
the Board of Directors. Mr.&nbsp;Millstein received his MSCE and Ph.D. in Civil
Engineering from Moscow State Construction University in 1964 and 1974,
respectively. After immigrating to the United States in 1978, he held teaching
positions at Howard University in Washington D.C. and Johns Hopkins University
in Baltimore, Maryland. He has over 200 publications and is a member of the
American Concrete Institute and American Society of Civil Engineers. From 1981
to the present, he has been a CEO of Radcon Products, a company involved in
manufacturing of proprietary concrete sealants. From 1990 until the present, he
has been a Chairman of the Board of TTLTIC, a private consulting company.
</FONT>
<P><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<B>Boris Skurkovich, M.D. </B>- Since 1986, Mr.&nbsp;Skurkovich has served as a member
of the Board of Directors, and from that same date until December 2000, he was
a Vice President of the Company. He completed a clinical and research
fellowship at the Maxwell Finland Laboratory for Infectious Diseases, Boston
City Hospital, Boston,
Massachusetts, and presently is a professor at Brown University Medical School.
He has collaborated with his father, Simon, on the development of the Company&#146;s
treatment of autoimmune diseases. Dr.&nbsp;Skurkovich received his M.D. from the
Moscow State Medical Institute.
</FONT>
<P><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<B>Simon Skurkovich, M.D. </B>- From 1985 until September 2000, Dr.&nbsp;Skurkovich
served as Chairman of the Board of Directors. He has previously been granted
five patents in Russia, and eight in the U.S. He is the creator of immune
preparations from human blood against antibiotic resistant bacteria that saved
thousands of lives in the Soviet Union and Eastern Europe. In Russia, he was
professor and Chief of the Immunology Laboratory of the Institute of Hematology
and Blood Transfusion and was awarded gold and silver medals for his scientific
discoveries. His laboratory was also awarded the nation&#146;s highest honor, the
Lenin Prize, for his patented work. Dr.
</FONT>
<P align="center"><FONT size="2">Page 14 of 24
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<P><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Skurkovich received an M.D., Ph.D. and a Doctorate in Medical Sciences (D.Sc.)
from Pirogov State Medical Institute in Moscow. He has written more than 200
articles for scientific publications.
</FONT>
<P><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<B>Thomas J. Pernice </B>&#151; Since April, 2001, Mr.&nbsp;Pernice has served as the
Treasurer and Secretary of the Company and as a member of the Board of
Directors. Mr.&nbsp;Pernice is a managing director of Cappello Group, Inc., a
merchant banking firm. Prior to joining the Cappello Group in January, 1999,
Mr.&nbsp;Pernice served as a senior corporate executive in government and industry
for more than 17&nbsp;years. Most recently, he was Vice President, Public Affairs
and a corporate officer for Dole Food Co. Inc. (NYSE:DOL), reporting to the
chairman and CEO, David H. Murdock. He also served in similar capacities for
the conglomerate of publicly and privately held business interests of Murdock,
including the Castle &#038; Cooke Inc. real estate company, formerly (NYSE:CCS), now
privately held. Prior to joining Dole Food Co., Mr.&nbsp;Pernice served in the
White House for more than seven years in various capacities for the Reagan and
Bush administrations. Mr.&nbsp;Pernice earned a bachelor of arts degree from the
University of Southern California in 1984.
</FONT>
<P align="center"><FONT size="2"><B>The Board of Directors recommends a vote FOR<BR>
the election of the nominees listed above.</B></FONT>

<P align="center"><FONT size="2"><B>PROPOSAL NO. 2</B></FONT>

<P align="center"><FONT size="2"><B>ADOPTION OF THE ADVANCED BIOTHERAPY, INC.<BR>
2000 OMNIBUS EQUITY INCENTIVE PLAN</B></FONT>

<P><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;The Board of Directors (the &#147;Board&#148;) believes that it is in the best
interests of the Company and its stockholders to adopt the Advanced Biotherapy,
Inc. 2000 Omnibus Equity Incentive Plan (the &#147;2000 Equity Plan&#148;). The Board
approved the 2000 Equity
Plan at a meeting on December&nbsp;12, 2000 subject to the approval
of the stockholders at the Annual
Meeting. The 2000 Equity Plan is intended to encourage ownership of the
Company&#146;s Common Stock by employees, consultants and outside directors of the
Company, who are considered to contribute to the growth or profitability of the
Company and to provide incentives to eligible employees to use their best
efforts on behalf of the Company. The Board believes that the 2000 Equity Plan
will enable the Company to retain and attract qualified individuals. If the
2000 Equity Plan is approved by the stockholders at the Annual Meeting, it will
be effective as of December&nbsp;1, 2000.
</FONT>
<P><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;The 2000 Equity Plan provides for the grant of both incentive stock
options under Section&nbsp;422 of the Internal Revenue Code of 1986, as amended (the
&#147;Code&#148;), and nonqualified stock options (collectively &#147;Options&#148;), as well as
stock appreciation rights (&#147;SARs&#148;) (Options and SARs being sometimes
collectively hereinafter referred to as
</FONT>
<P align="center"><FONT size="2">Page 15 of 24
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<P><FONT size="2">&#147;Awards&#148;). An aggregate of 4,000,000 shares of Common Stock (subject to annual
adjustments equal to the lesser of 2.5% of the then outstanding shares of
Common Stock or 250,000 shares and adjustments in the event of stock splits or
other changes in the Common Stock) may be awarded under the 2000 Equity Plan or
purchased upon exercise of the Options.
</FONT>
<P><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;The 2000 Equity Plan will be administered by the Board of Directors or
such other committee as the Board may appoint (the &#147;Committee&#148;). The Committee
shall have at least two members and each member shall be a member of the Board
and (unless otherwise determined by the Board) shall, as applicable, satisfy
the &#147;nonemployee director&#148; requirements of Rule&nbsp;16b-3 under the Securities
Exchange Act of 1934 (the &#147;Exchange Act&#148;) and the &#147;outside director&#148; provisions
of Section&nbsp;162(m) of the Code.
</FONT>
<P><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;The Committee will select those employees, consultants and outside
directors who will participate in the 2000 Equity Plan based upon its sole
judgment as to their past or potential contribution to the business of the
Company and will determine (i)&nbsp;whether the Options to be granted will be
incentive stock options or nonqualified stock options or a combination thereof,
(ii)&nbsp;the number of shares of Common Stock subject to Options granted or used to
determine the value of a SAR, (iii)&nbsp;the time or times when and the manner in
which Options can be exercised and the duration of the exercise period and (iv)
whether all or part of an Option may be cancelled by the exercise of a SAR, and
(v)&nbsp;any other terms not inconsistent with the 2000 Equity Plan. Awards may be
granted to an employee who is not an officer of the Company by the Board or the
Executive Committee of the Board (in lieu of the Committee), in which case the
Board or Executive Committee may exercise any discretionary authority that
would otherwise be exercisable by the Committee.
</FONT>
<P><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Awards may be granted for terms not exceeding ten years from their date of
grant. No Award may be granted more than ten years after the effective date of
the 2000 Equity Plan. Each Award will be evidenced by an agreement
incorporating its terms and conditions.
</FONT>
<P><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;The exercise price of incentive stock options and tandem SARs granted
under the 2000 Equity Plan must be at least equal to the fair market value of
the Common Stock (or, in the case of an employee who at the time of grant owns
more than 10% of the Company&#146;s voting stock, 110% of such fair market value).
</FONT>
<P><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Options and SARs are not transferable other than by will or pursuant to
the laws of descent and distributions; provided, however, that if the Award
agreement so provides, an employee may transfer an Award other than an
incentive stock option or related SAR to the employee&#146;s spouse, parents,
children, or grandchildren, or to a trust for the benefit of such family
members, provided the employee does not receive any consideration for the
transfer. Any Award so transferred remains subject to the same
</FONT>
<P align="center"><FONT size="2">Page 16 of 24
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<P><FONT size="2">terms and
conditions as applied immediately before the transfer (except that the Award is
not further transferable by the transferee during the employee&#146;s lifetime).
</FONT>
<P><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;The exercise price for shares of Common Stock subject to Options may be
paid with cash, stock, a combination of the foregoing, or any other form of
consideration deemed appropriate by the Committee and having a fair market
value equal to the exercise price. Alternatively, an Option may be exercised in
whole or in part by delivering a properly executed exercise notice together
with irrevocable instructions to a broker to deliver promptly to the Company
the amount of sale or loan proceeds necessary to pay the purchase price and
applicable withholding taxes, and such other documents as the Committee may
determine. The Committee may also provide for loans to employees in connection
with the exercise of an Option on such terms as the Committee may determine.
</FONT>
<P><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Upon exercise of a SAR, an employee will receive a cash payment equal to
the number of shares of Common Stock covered by the SAR multiplied by the
excess of the fair market value of a share of Common Stock at the time of
exercise over the exercise price of the related Option (or if there is no
related Option, an amount not less than the fair market value of a share of
Common Stock on the date of grant). In the case of a tandem SAR, the related
Option will be canceled at the time of such exercise.
</FONT>
<P><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;The Committee will interpret the provisions of the 2000 Equity Plan, make
all necessary decisions and determinations and provide other related
administrative services. Subject to the provisions of the 2000 Equity Plan,
the Committee may act in its sole discretion and its decisions and
determinations under the 2000 Equity Plan need not be uniform and may treat
similarly situated employees in a dissimilar manner.
</FONT>
<P><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;The Committee will also provide for certain specific terms regarding
Options and SARs in individual option agreements between the Company and
pertinent employees. Among other things, such agreements may provide for
conditions to the exercise of
Options or SARs, including a required period of employment by the Company or
the attainment of certain performance goals or other criteria, and may provide
for exercisability in installments. In the case of SARs, the agreements will
provide that the period during which a SAR is exercisable can commence no
earlier than six months following the date of grant.
</FONT>
<P><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Under the 2000 Equity Plan, if an employee&#146;s employment terminates other
than for cause, disability or death, Options or SARs granted to such employee
are exercisable, to the extent exercisable by the employee at the date of
termination, at any time within three months after the date of termination, or
during such other period and on such other terms as the Committee may determine
but not later than the expiration of its term. If an employee who has been
granted an Option or SAR dies while an employee of the Company, such employee&#146;s
Options or SARs are exercisable, to the extent exercisable on his or her date
of death, by the employee&#146;s designated beneficiary or as otherwise
</FONT>
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<P><FONT size="2">required by
law at any time or from time to time within six months after the date of death
or during such other period and on such other terms as the Committee may
determine. If the employment of an employee who has been granted an Option or
SAR terminates as a result of such employee&#146;s total disability, such employee&#146;s
Options or SARs are exercisable, to the extent exercisable on the date of
termination, at any time
or from time to time within six months after the date of termination or
during such other period and on such other terms as the Committee may
determine.
</FONT>
<P><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;In the event that an employee&#146;s employment terminates for any reason prior
to the date on which some or all of the Options or SARs become exercisable,
such Options or SARs automatically expire without compensation and may be
granted again. However, the Committee may in its sole discretion determine to
pay reasonable compensation to employees (or, in the case of death, their
beneficiaries) whose employment terminates as the result of death or total
disability.
</FONT>
<P><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;The Board in its sole discretion may provide at the time of grant of an
Option or otherwise that upon the occurrence of a change of control of the
Company (as determined by the Board), all or a specified portion of any
outstanding Options not theretofore exercisable shall immediately become
exercisable and that any Option not exercised prior to such change in control
shall be canceled.
</FONT>
<P><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;The Board may, at any time, amend or terminate the 2000 Equity Plan.
However, no amendment shall become effective without approval by a majority of
the Company&#146;s stockholders if such approval is necessary or desirable for the
continued validity of the Plan or if the failure to obtain such approval would
adversely affect the compliance of the Plan with Rule&nbsp;16b-3 or any successor
rule under the Exchange Act or Section&nbsp;162(m) of the Code or any other rule or
regulation. No amendment or termination may retroactively impair the rights of
any person with respect to an Option or SAR.
</FONT>
<P><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;The foregoing description of the 2000 Equity Plan is qualified by
reference to the detailed terms of the 2000 Equity Plan, a copy of which is
attached as Appendix&nbsp;A hereto.
</FONT>
<P><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Stockholders are urged to review the 2000 Equity Plan before determining
how to vote on this proposal.
</FONT>
<P align="left"><FONT size="2"><B>Recommendation of the Board of Directors</B></FONT>

<P><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Under the Company&#146;s Articles of Incorporation and Delaware Law, this
Proposal 2 to adopt the Company&#146;s 2000 Omnibus Equity Incentive Plan must be
approved by the affirmative vote of at least a majority of the shares of Common
Stock present, in person or by proxy, at the Annual Meeting and entitled to
vote at the Meeting.
</FONT>
<P align="center"><FONT size="2">Page 18 of 24
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<P align="center"><FONT size="2"><B>The Board of Directors of the Company<BR>
Recommends a Vote FOR this Proposal No.&nbsp;2</B></FONT>

<P align="center"><FONT size="2"><B>PROPOSAL NO. 3</B></FONT>


<P align="center"><FONT size="2"><B>APPROVAL OF A REVERSE STOCK SPLIT IN A RANGE NOT TO EXCEED<BR>
A ONE-FOR-TEN REVERSE SPLIT, I.E., AT A RATIO OF AT LEAST<BR>
1:10, PROVIDED SUCH REVERSE STOCK SPLIT SHALL NOT BECOME<BR>
EFFECTIVE UNLESS A SIGNIFICANT TRANSACTION SHALL HAVE<BR>
OCCURRED AND THE BOARD OF DIRECTORS MAKES A DETERMINATION<BR>
WITHIN THREE (3)&nbsp;YEARS AFTER THE ANNUAL MEETING THAT<BR>
SUCH STOCK SPLIT IS IN THE BEST INTEREST<BR>
OF THE COMPANY&#146;S STOCKHOLDERS</B></FONT>

<P align="left"><FONT size="2"><B>General</B></FONT>

<P><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;The Board of Directors seeks approval to effect a decrease in the number
of shares of Company Common Stock outstanding by means of a reverse stock split
(&#147;Reverse Stock Split&#148;). The Reverse Stock Split must be in a range not to
exceed a one-for-ten reverse split, i.e., a ratio of at least 1:10, which
means, one (1)&nbsp;share for ten (10)&nbsp;shares or a lesser number of shares. The
Reverse Stock Split shall not be adopted unless and until (a)&nbsp;the Board of
Directors making a determination within three (3)&nbsp;years after the Annual
Meeting that such action is in the best interest of the Company&#146;s stockholders
and (b)&nbsp;either the Company (x)&nbsp;raises new financing through the sale of equity
securities (or securities convertible into equity) or a merger in which the
Company is (or is not) the surviving entity or (y)&nbsp;generates positive cash flow
through a joint venture, licensing or similar arrangement with a strategic
partner (collectively &#147;Significant Transaction&#148;). As a consequence, for
example, the Board of Directors would have the authority in its discretion to
effect a Reverse Stock Split in the future at a ratio of one (1)&nbsp;share for two
(2)&nbsp;shares, or four (4)&nbsp;shares, or ten (10)&nbsp;shares, but not one (1)&nbsp;share for
eleven (11)&nbsp;shares. Fractional shares will be rounded up to the next whole
number. For example, in the event that the Board of Directors were to approve
a ratio of one (1)&nbsp;share to ten (10)&nbsp;shares, after the Reverse Stock Split,
each stockholder will own one-tenth (1/10) of the number of shares of Common
Stock that such stockholder owned prior to the Reverse Stock Split, subject to
such roundoff. If this Proposal 3 is approved and effectuated, the authorized
but unissued shares of Common Stock will not be reduced from, but rather will
remain, 100,000,000 shares of Common Stock. Moreover, in the foregoing
example, stock options outstanding would similarly be proportionately reduced
by a factor of one-tenth (1/10) and the exercise price would be increased by a
factor of ten (10). The implementation of a possible future Reverse Stock
Split would not result in a change in the relative equity positions or voting
power of stockholders, except for the effect of the elimination of fractional
shares. However, there can be no assurance that the Reverse Stock Split would
not have a material adverse effect on the total value of the Company&#146;s Common
Stock or on the stockholders, whether collectively or on any stockholder
individually.
</FONT>
<P><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;At the Company&#146;s Annual Meeting held August&nbsp;24, 2000, the proposal, which
granted the Board of Directors authority to effect a reverse stock split at a
ratio of at least 1:4 for a one-year period, was approved by 95% of the
stockholders present, in person or by proxy.
</FONT>


<P align="center"><FONT size="2">Page 19 of 24
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<P align="left"><FONT size="2"><B>Future Determination by the Board of Directors</B></FONT>

<P><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Notwithstanding a favorable vote by the stockholders, the Company reserves
the right by action of the Board of Directors to determine if, and when, a
Reverse Stock Split shall be effected, provided that no such Reverse Stock
Split shall be adopted unless a Significant Transaction shall have occurred and the
Board of Directors shall have determined that such Reverse Stock Split is in
the best interests of the Company&#146;s stockholders and such determination, if at
all, shall have been made on or prior to the date which is the third
anniversary of the date of the Annual Meeting.
</FONT>
<P><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<U>As of the date of this Proxy Statement, the Board of Directors has
determined that a Reverse Stock Split would not be in the best interests of the
stockholders.</U>
</FONT>
<P align="left"><FONT size="2"><B>Purposes for a Reverse Stock Split</B></FONT>

<P><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;The Company&#146;s shares currently trade only over-the-counter on the &#147;OTC
Bulletin Board&#148; (the &#147;OTC Bulletin Board&#148;). The proposal, which grants the
Board of Directors the authorization to effect a Reverse Stock Split if the
Board deems such future possible action to be in the best interest of the
stockholders, would be designed to help the Company meet certain of the listing
requirements of the American Stock Exchange or the NASD National Market System,
or the NASD small cap market system.
</FONT>
<P><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;The bid price of the Common Stock of the Company has been generally below
$1.00 for the past 12&nbsp;months. Management believes it is in the best interest
of stockholders to approve this Proposal so that the Company&#146;s Common Stock
might trade at a level greater than the NASD National Market System minimum bid
price, thus enabling the Company&#146;s Common Stock to satisfy such listing
requirement although the Company has not submitted a listing application and
presently does not meet certain other listing requirements. There can be no
assurance that the Company would be able to satisfy the requirements for
listing of its Common Stock on the NASD National Market System. The Common
Stock of the Company which is traded, if at all, on the &#147;OTC Bulletin Board&#148;
might be substantially less liquid and less active than if the Common Stock
were traded on the American Stock Exchange, the NASD National Market System, or
the NASD small cap market system.
</FONT>
<P><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;The Company further believes that the total number of shares of the
Company&#146;s Common Stock outstanding is disproportionately large and that the
current per share price causes reluctance of many brokerage firms and institutional
investors to recommend and/or purchase or trade in low priced or &#147;penny&#148;
stocks. Most institutional investors require a minimum stock price range from
$2.00 to $5.00 per share as a minimum suitability requirement. In addition,
certain policies and procedures in the securities industry may tend to
discourage individual brokers from dealing in penny stocks. Some of those
policies and practices involve time-consuming procedures that make the handling
of lower-priced stocks economically unattractive. The Board of Directors
believes that a decrease in the number of shares of Common Stock outstanding
without material alteration of the respective economic interests in the Company
of stockholders would likely increase the perception of, and thereby the
valuation of, such shares. However, no assurance can be given that the market
price of the Common Stock would rise in exact proportion to the reduction in
the number of outstanding shares resulting from the Reverse Stock Split.
</FONT>
<P align="center"><FONT size="2">Page 20 of 24
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<P><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Another projected economic benefit of the Reverse Stock Split would be a
likely reduction in the costs of trading in the shares of the Company. In most
cases trading costs include both the indirect cost of &#147;dealer markup,&#148; that is,
the difference between the buying and selling prices of dealers in a given
stock (i.e., the &#147;bid-ask&#148; spread), as well as the commission applied to a
given transaction. Most broker-dealers, including both &#147;full-commission&#148; and
&#147;discount&#148; broker-dealers, use both a &#147;bid-ask spread&#148; and a transaction
commission in connection with trades in all OTC Bulletin Board-listed shares.
Generally speaking, a substantial increase in the price per share of a stock
may decrease both the &#147;bid-ask&#148; spread as a proportion of the stock price, and
the per share commission on the vast majority of retail transactions in any
listed stock.
</FONT>
<P><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;The market price of the Common Stock is based on Company performance and
other factors, some of which may be partially or even wholly unrelated to the
number of shares outstanding.
</FONT>
<P><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;The following table sets forth quotations for the high and low bid
quotations of the Common Stock for the periods indicated below, as quoted on
the OTC Bulletin Board operated by the National Association of Securities
Dealers, Inc., without adjustments for retail mark-ups, mark-downs or
commissions. These prices may not represent actual transactions:
</FONT>
<CENTER>
<TABLE cellspacing="0" border="0" cellpadding="0" width="55%">
<TR valign="bottom">
        <TD width="70%">&nbsp;</TD>
        <TD width="5%">&nbsp;</TD>
        <TD width="4%">&nbsp;</TD>
        <TD width="1%">&nbsp;</TD>
        <TD width="5%">&nbsp;</TD>
        <TD width="5%">&nbsp;</TD>
        <TD width="4%">&nbsp;</TD>
        <TD width="1%">&nbsp;</TD>
        <TD width="5%">&nbsp;</TD>
</TR>
<TR valign="bottom">
        <TD><FONT size="1">&nbsp;</FONT></TD>
        <TD><FONT size="1">&nbsp;</FONT></TD>
        <TD nowrap align="center" colspan="3"><FONT size="1"><B>High Bid</B></FONT></TD>
        <TD><FONT size="1">&nbsp;</FONT></TD>
        <TD nowrap align="center" colspan="3"><FONT size="1"><B>Low Bid</B></FONT></TD>
</TR>
<TR valign="bottom">
        <TD><FONT size="1">&nbsp;</FONT></TD>
        <TD><FONT size="1">&nbsp;</FONT></TD>
        <TD colspan="3"><HR size="1" noshade></TD>
        <TD><FONT size="1">&nbsp;</FONT></TD>
        <TD colspan="3"><HR size="1" noshade></TD>
</TR>
<TR valign="bottom">
        <TD><DIV style="margin-left:10px; text-indent:-10px"><FONT size="2"><B>1999 Fiscal Quarter Ended:</B></FONT></DIV></TD>
        <TD><FONT size="2">&nbsp;</FONT></TD>
        <TD><FONT size="2">&nbsp;</FONT></TD>
        <TD><FONT size="2">&nbsp;</FONT></TD>
        <TD><FONT size="2">&nbsp;</FONT></TD>
        <TD><FONT size="2">&nbsp;</FONT></TD>
        <TD><FONT size="2">&nbsp;</FONT></TD>
        <TD><FONT size="2">&nbsp;</FONT></TD>
        <TD><FONT size="2">&nbsp;</FONT></TD>
</TR>

<TR valign="bottom">
        <TD><DIV style="margin-left:10px; text-indent:-10px"><FONT size="2">March 31</FONT></DIV></TD>
        <TD><FONT size="2">&nbsp;</FONT></TD>
        <TD align="right"><FONT size="2">$</FONT></TD>
        <TD align="right"><FONT size="2">0.20</FONT></TD>
        <TD><FONT size="2">&nbsp;</FONT></TD>
        <TD><FONT size="2">&nbsp;</FONT></TD>
        <TD align="right"><FONT size="2">$</FONT></TD>
        <TD align="right"><FONT size="2">0.10</FONT></TD>
        <TD><FONT size="2">&nbsp;</FONT></TD>
</TR>

<TR valign="bottom">
        <TD><DIV style="margin-left:10px; text-indent:-10px"><FONT size="2">June 30</FONT></DIV></TD>
        <TD><FONT size="2">&nbsp;</FONT></TD>
        <TD align="right"><FONT size="2">$</FONT></TD>
        <TD align="right"><FONT size="2">0.08</FONT></TD>
        <TD><FONT size="2">&nbsp;</FONT></TD>
        <TD><FONT size="2">&nbsp;</FONT></TD>
        <TD align="right"><FONT size="2">$</FONT></TD>
        <TD align="right"><FONT size="2">0.05</FONT></TD>
        <TD><FONT size="2">&nbsp;</FONT></TD>
</TR>

<TR valign="bottom">
        <TD><DIV style="margin-left:10px; text-indent:-10px"><FONT size="2">September 30</FONT></DIV></TD>
        <TD><FONT size="2">&nbsp;</FONT></TD>
        <TD align="right"><FONT size="2">$</FONT></TD>
        <TD align="right"><FONT size="2">0.10</FONT></TD>
        <TD><FONT size="2">&nbsp;</FONT></TD>
        <TD><FONT size="2">&nbsp;</FONT></TD>
        <TD align="right"><FONT size="2">$</FONT></TD>
        <TD align="right"><FONT size="2">0.01</FONT></TD>
        <TD><FONT size="2">&nbsp;</FONT></TD>
</TR>

<TR valign="bottom">
        <TD><DIV style="margin-left:10px; text-indent:-10px"><FONT size="2">December 31</FONT></DIV></TD>
        <TD><FONT size="2">&nbsp;</FONT></TD>
        <TD align="right"><FONT size="2">$</FONT></TD>
        <TD align="right"><FONT size="2">0.35</FONT></TD>
        <TD><FONT size="2">&nbsp;</FONT></TD>
        <TD><FONT size="2">&nbsp;</FONT></TD>
        <TD align="right"><FONT size="2">$</FONT></TD>
        <TD align="right"><FONT size="2">0.05</FONT></TD>
        <TD><FONT size="2">&nbsp;</FONT></TD>
</TR>

<TR valign="bottom">
        <TD><DIV style="margin-left:10px; text-indent:-10px"><FONT size="2"><B>2000 Fiscal Quarter Ended:</B></FONT></DIV></TD>
        <TD><FONT size="2">&nbsp;</FONT></TD>
        <TD><FONT size="2">&nbsp;</FONT></TD>
        <TD><FONT size="2">&nbsp;</FONT></TD>
        <TD><FONT size="2">&nbsp;</FONT></TD>
        <TD><FONT size="2">&nbsp;</FONT></TD>
        <TD><FONT size="2">&nbsp;</FONT></TD>
        <TD><FONT size="2">&nbsp;</FONT></TD>
        <TD><FONT size="2">&nbsp;</FONT></TD>
</TR>

<TR valign="bottom">
        <TD><DIV style="margin-left:10px; text-indent:-10px"><FONT size="2">March 31</FONT></DIV></TD>
        <TD><FONT size="2">&nbsp;</FONT></TD>
        <TD align="right"><FONT size="2">$</FONT></TD>
        <TD align="right"><FONT size="2">2.63</FONT></TD>
        <TD><FONT size="2">&nbsp;</FONT></TD>
        <TD><FONT size="2">&nbsp;</FONT></TD>
        <TD align="right"><FONT size="2">$</FONT></TD>
        <TD align="right"><FONT size="2">1.75</FONT></TD>
        <TD><FONT size="2">&nbsp;</FONT></TD>
</TR>

<TR valign="bottom">
        <TD><DIV style="margin-left:10px; text-indent:-10px"><FONT size="2">June 30</FONT></DIV></TD>
        <TD><FONT size="2">&nbsp;</FONT></TD>
        <TD align="right"><FONT size="2">$</FONT></TD>
        <TD align="right"><FONT size="2">1.81</FONT></TD>
        <TD><FONT size="2">&nbsp;</FONT></TD>
        <TD><FONT size="2">&nbsp;</FONT></TD>
        <TD align="right"><FONT size="2">$</FONT></TD>
        <TD align="right"><FONT size="2">0.44</FONT></TD>
        <TD><FONT size="2">&nbsp;</FONT></TD>
</TR>

<TR valign="bottom">
        <TD><DIV style="margin-left:10px; text-indent:-10px"><FONT size="2">September 30</FONT></DIV></TD>
        <TD><FONT size="2">&nbsp;</FONT></TD>
        <TD align="right"><FONT size="2">$</FONT></TD>
        <TD align="right"><FONT size="2">1.00</FONT></TD>
        <TD><FONT size="2">&nbsp;</FONT></TD>
        <TD><FONT size="2">&nbsp;</FONT></TD>
        <TD align="right"><FONT size="2">$</FONT></TD>
        <TD align="right"><FONT size="2">0.50</FONT></TD>
        <TD><FONT size="2">&nbsp;</FONT></TD>
</TR>

<TR valign="bottom">
        <TD><DIV style="margin-left:10px; text-indent:-10px"><FONT size="2">December 31</FONT></DIV></TD>
        <TD><FONT size="2">&nbsp;</FONT></TD>
        <TD align="right"><FONT size="2">$</FONT></TD>
        <TD align="right"><FONT size="2">0.75</FONT></TD>
        <TD><FONT size="2">&nbsp;</FONT></TD>
        <TD><FONT size="2">&nbsp;</FONT></TD>
        <TD align="right"><FONT size="2">$</FONT></TD>
        <TD align="right"><FONT size="2">0.20</FONT></TD>
        <TD><FONT size="2">&nbsp;</FONT></TD>
</TR>

<TR valign="bottom">
        <TD><DIV style="margin-left:10px; text-indent:-10px"><FONT size="2"><B>2001 Fiscal Quarter Ended:</B></FONT></DIV></TD>
        <TD><FONT size="2">&nbsp;</FONT></TD>
        <TD><FONT size="2">&nbsp;</FONT></TD>
        <TD><FONT size="2">&nbsp;</FONT></TD>
        <TD><FONT size="2">&nbsp;</FONT></TD>
        <TD><FONT size="2">&nbsp;</FONT></TD>
        <TD><FONT size="2">&nbsp;</FONT></TD>
        <TD><FONT size="2">&nbsp;</FONT></TD>
        <TD><FONT size="2">&nbsp;</FONT></TD>
</TR>

<TR valign="bottom">
        <TD><DIV style="margin-left:10px; text-indent:-10px"><FONT size="2">March 31</FONT></DIV></TD>
        <TD><FONT size="2">&nbsp;</FONT></TD>
        <TD align="right"><FONT size="2">$</FONT></TD>
        <TD align="right"><FONT size="2">0.53</FONT></TD>
        <TD><FONT size="2">&nbsp;</FONT></TD>
        <TD><FONT size="2">&nbsp;</FONT></TD>
        <TD align="right"><FONT size="2">$</FONT></TD>
        <TD align="right"><FONT size="2">0.24</FONT></TD>
        <TD><FONT size="2">&nbsp;</FONT></TD>
</TR>

<TR valign="bottom">
        <TD><DIV style="margin-left:10px; text-indent:-10px"><FONT size="2">June 30</FONT></DIV></TD>
        <TD><FONT size="2">&nbsp;</FONT></TD>
        <TD align="right"><FONT size="2">$</FONT></TD>
        <TD align="right"><FONT size="2">0.34</FONT></TD>
        <TD><FONT size="2">&nbsp;</FONT></TD>
        <TD><FONT size="2">&nbsp;</FONT></TD>
        <TD align="right"><FONT size="2">$</FONT></TD>
        <TD align="right"><FONT size="2">0.20</FONT></TD>
        <TD><FONT size="2">&nbsp;</FONT></TD>
</TR>
</TABLE>
</CENTER>
<P><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;No dividend has ever been declared or paid by the Company with respect to
its Common Stock. The Company does not anticipate that any dividend will be
declared or paid in the foreseeable future on the Company&#146;s Common Stock.
</FONT>
<P align="left"><FONT size="2"><B>Effects of a Reverse Stock Split and Elimination of Fractional Share Interests</B></FONT>

<P><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;In the event a Significant Transaction occurs and the Board of Directors
were to approve a Reverse Stock Split, on the effective date of the Reverse
Stock Split, as further described below, the number of shares of each
stockholder would automatically be
</FONT>
<P align="center"><FONT size="2">Page 21 of 24
</FONT>

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<P><FONT size="2">adjusted on the records of the Company to
the number of shares of Common Stock previously held, divided by the share
split ratio number, and no fractional shares will be issued to any stockholder,
but rather fractional shares would be rounded up to the next whole number.
</FONT>
<P><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;For stockholders who own less than 100 shares of the Company, the Reverse
Stock Split will result in such stockholders owning &#147;odd lots&#148; (i.e., lots of
less than 100 shares) of Common Stock. Odd lot shares may be more difficult to
sell, or may require a somewhat greater commission per share to sell, than
shares in lots of 100. There can be no assurances that the Reverse Stock
Split will not otherwise have a detrimental effect on the total value of the
Company&#146;s Common Stock.
</FONT>
<P align="left"><FONT size="2"><B>Certificates and Mandatory Exchange</B></FONT>

<P><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;In the event this Proposal 3 is approved, and if a Significant Transaction
subsequently occurs and the Board of Directors thereafter determines to
undertake a Reverse Stock Split, stockholders will be required to exchange
their certificates representing shares of Common Stock held prior to the
Reverse Stock Split for new certificates representing their shares after the
Reverse Stock Split. Stockholders will be furnished the necessary materials
and instructions to effect such exchange of certificates promptly following the
effective date thereof by the Company&#146;s transfer agent. Certificates
representing shares of Common Stock before the Reverse Stock Split would not be
transferred on the books and records of the Company until such certificates had
been exchanged for certificates representing shares of Common Sock after the
Reverse Stock Split. In the event any certificate representing Common Stock
was not returned to the Company, any dividends that may be declared after the
effective date of the Reverse Stock Split with respect to the Common Stock
represented thereby would be withheld until such certificate had been properly
presented for exchange, at which time all such withheld dividends which had not
yet been paid to the public official pursuant to relevant abandoned property
laws would be paid to the holder thereof or his designee, without interest.
</FONT>
<P><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<U>No action is required of stockholders regarding their stock certificates.
This Proxy Statement is not a request or notice for stockholders to exchange
their stock certificates.</U>
</FONT>

<P align="center"><FONT size="2">Page 22 of 24</FONT>


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<P align="left"><FONT size="2"><B>Certain Federal Income Tax Consequences of the Reverse Stock Split</B></FONT>

<P><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;The following description of federal income tax consequences of the
Reverse Stock Split is based on the Internal Revenue Code of 1986, as amended
(the &#147;Code&#148;), and applicable Treasury Regulations issued thereunder, judicial
authority and current administrative rulings and practices as of the date of
this Proxy Statement. This summary does not take into account possible changes
in such laws or interpretations, including amendments to the Code, applicable
statutes, regulations and proposed regulations or changes in judicial or
administrative rulings, some of which may have retroactive effect. This
discussion should not be considered tax or investment advice, and the tax
consequences of the Reverse Stock Split may not be the same for all
stockholders. All stockholders desiring specification of the federal state,
local and foreign tax consequences to them should consult their individual tax
advisors.
</FONT>
<P><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;In the event of a Reverse Stock Split, a stockholder will not recognize
taxable gain or loss on the receipt of new certificates in exchange for old
certificates in the Reverse Stock Split. In the aggregate, the stockholder&#146;s
basis in the Common Stock represented by new certificates will equal his or her
basis in the shares of Common Stock represented by old certificates exchanged
therefor, and such stockholder&#146;s holding period for the new certificates will
include the holding period for the old certificates therefor, if the shares of
Common Stock represented by such certificates are capital assets in the hands
of such stockholder.
</FONT>
<P align="left"><FONT size="2"><B>Recommendation of the Board of Directors</B></FONT>

<P><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Under the Company&#146;s Articles of Incorporation and Delaware Law, this
Proposal No.&nbsp;3 to effect a decrease in the number of shares of the Company&#146;s
Common Stock by a Reverse Stock Split subject to the occurrence of a
Significant Transaction and a future determination by the
Board of Directors must be approved by the affirmative vote of at least a
majority of the shares of Common Stock present in person or by proxy at the
Annual Meeting and entitled to vote at the Meeting.
</FONT>
<P align="center"><FONT size="2"><B>The Board of Directors of the Company Recommends a Vote FOR this Proposal 3</B>.</FONT>

<!-- link1 "OTHER MATTERS" -->
<DIV align="left"><A NAME="003"></A></DIV>
<P align="center"><FONT size="2"><B>OTHER MATTERS</B></FONT>

<P><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;The Company knows of no other matters that will be presented for
consideration at the Annual Meeting. If any other matters properly come before
the Annual Meeting, the persons named as proxies on the enclosed proxy card or
their substitutes will vote such proxy in accordance with their discretion with
respect to such matters.
</FONT>
<P align="center"><FONT size="2">Page 23 of 24
</FONT>

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<!-- link1 "AVAILABLE INFORMATION" -->
<DIV align="left"><A NAME="004"></A></DIV>
<P align="center"><FONT size="2"><B>AVAILABLE INFORMATION</B></FONT>

<P><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;As part of this Proxy Statement, the Company incorporates by reference the
Company&#146;s 2000 Omnibus Equity Incentive Plan affixed hereto marked <U>Appendix&nbsp;A.</U></FONT>
<PRE>

</PRE>

<P><FONT size="2">Dated: October ____, 2001
</FONT>
<P align="center"><FONT size="2">Page 24 of 24
</FONT>

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<!-- link1 "APPENDIX A" -->
<DIV align="left"><A NAME="005"></A></DIV>
<P align="right"><FONT size="2"><B>APPENDIX A</B></FONT>

<P align="center"><FONT size="2"><B>ADVANCED BIOTHERAPY, INC.</B></FONT>

<P align="center"><FONT size="2"><B>2000 OMNIBUS EQUITY INCENTIVE PLAN</B></FONT>

<P align="center"><FONT size="2"><B>TABLE OF CONTENTS</B></FONT>

<CENTER>
<TABLE cellspacing="0" border="0" cellpadding="0" width="100%">
<TR valign="bottom">
        <TD width="8%">&nbsp;</TD>
        <TD width="6%">&nbsp;</TD>
        <TD width="22%">&nbsp;</TD>
        <TD width="3%">&nbsp;</TD>
        <TD width="55%">&nbsp;</TD>
        <TD width="3%">&nbsp;</TD>
        <TD width="1%">&nbsp;</TD>
        <TD width="1%">&nbsp;</TD>
        <TD width="1%">&nbsp;</TD>
</TR>
<TR valign="bottom">
        <TD><FONT size="1">&nbsp;</FONT></TD>
        <TD><FONT size="1">&nbsp;</FONT></TD>
        <TD><FONT size="1">&nbsp;</FONT></TD>
        <TD><FONT size="1">&nbsp;</FONT></TD>
        <TD><FONT size="1">&nbsp;</FONT></TD>
        <TD><FONT size="1">&nbsp;</FONT></TD>
        <TD nowrap align="center" colspan="3"><FONT size="1"><B>Page</B></FONT></TD>
</TR>
<TR valign="bottom">
        <TD><FONT size="1">&nbsp;</FONT></TD>
        <TD><FONT size="1">&nbsp;</FONT></TD>
        <TD><FONT size="1">&nbsp;</FONT></TD>
        <TD><FONT size="1">&nbsp;</FONT></TD>
        <TD><FONT size="1">&nbsp;</FONT></TD>
        <TD><FONT size="1">&nbsp;</FONT></TD>
        <TD colspan="3"><HR size="1" noshade></TD>
</TR>
<TR valign="bottom">
        <TD valign="top" COLSPAN="5"><FONT size="2"><B>ARTICLE
1.&nbsp; INTRODUCTION.</B></FONT></TD>
        <TD><FONT size="2">&nbsp;</FONT></TD>
        <TD nowrap align="right" valign="top"><FONT size="2">&nbsp;</FONT></TD>
        <TD align="right" valign="top"><FONT size="2">1</FONT></TD>
        <TD valign="top"><FONT size="2">&nbsp;</FONT></TD>
</TR>

<TR valign="bottom">
        <TD valign="top" COLSPAN="5"><FONT size="2"><B>ARTICLE 2. &nbsp;DEFINITIONS</B></FONT></TD>
        <TD><FONT size="2">&nbsp;</FONT></TD>
        <TD nowrap align="right" valign="top"><FONT size="2">&nbsp;</FONT></TD>
        <TD align="right" valign="top"><FONT size="2">1</FONT></TD>
        <TD valign="top"><FONT size="2">&nbsp;</FONT></TD>
</TR>

<TR valign="bottom">
        <TD valign="top" COLSPAN="5"><FONT size="2"><B>ARTICLE
3.&nbsp; SHARES AVAILABLE FOR GRANTS.</B></FONT></TD>
        <TD><FONT size="2">&nbsp;</FONT></TD>
        <TD nowrap align="right" valign="top"><FONT size="2">&nbsp;</FONT></TD>
        <TD align="right" valign="top"><FONT size="2">5</FONT></TD>
        <TD valign="top"><FONT size="2">&nbsp;</FONT></TD>
</TR>

<TR valign="bottom">
        <TD valign="top" ALIGN="RIGHT"><FONT size="2">3.1</FONT></TD>
        <TD><FONT size="2">&nbsp;</FONT></TD>
        <TD align="left" valign="top" COLSPAN="3"><FONT size="2">BASIC LIMITATION
</FONT></TD>
        <TD><FONT size="2">&nbsp;</FONT></TD>
        <TD nowrap align="right" valign="top"><FONT size="2">&nbsp;</FONT></TD>
        <TD align="right" valign="top"><FONT size="2">5</FONT></TD>
        <TD valign="top"><FONT size="2">&nbsp;</FONT></TD>
</TR>

<TR valign="bottom">
        <TD valign="top" ALIGN="RIGHT"><FONT size="2">3.2</FONT></TD>
        <TD><FONT size="2">&nbsp;</FONT></TD>
        <TD align="left" valign="top" COLSPAN="3"><FONT size="2">ANNUAL INCREASE IN SHARES
</FONT></TD>
        <TD><FONT size="2">&nbsp;</FONT></TD>
        <TD nowrap align="right" valign="top"><FONT size="2">&nbsp;</FONT></TD>
        <TD align="right" valign="top"><FONT size="2">6</FONT></TD>
        <TD valign="top"><FONT size="2">&nbsp;</FONT></TD>
</TR>

<TR valign="bottom">
        <TD valign="top" ALIGN="RIGHT"><FONT size="2">3.3</FONT></TD>
        <TD><FONT size="2">&nbsp;</FONT></TD>
        <TD align="left" valign="top" COLSPAN="3"><FONT size="2">ADDITIONAL SHARES
</FONT></TD>
        <TD><FONT size="2">&nbsp;</FONT></TD>
        <TD nowrap align="right" valign="top"><FONT size="2">&nbsp;</FONT></TD>
        <TD align="right" valign="top"><FONT size="2">6</FONT></TD>
        <TD valign="top"><FONT size="2">&nbsp;</FONT></TD>
</TR>

<TR valign="bottom">
        <TD valign="top" ALIGN="RIGHT"><FONT size="2">3.4</FONT></TD>
        <TD><FONT size="2">&nbsp;</FONT></TD>
        <TD align="left" valign="top" COLSPAN="3"><FONT size="2">DIVIDEND EQUIVALENTS
</FONT></TD>
        <TD><FONT size="2">&nbsp;</FONT></TD>
        <TD nowrap align="right" valign="top"><FONT size="2">&nbsp;</FONT></TD>
        <TD align="right" valign="top"><FONT size="2">6</FONT></TD>
        <TD valign="top"><FONT size="2">&nbsp;</FONT></TD>
</TR>

<TR valign="bottom">
        <TD valign="top" COLSPAN="5"><FONT size="2"><B>ARTICLE
4.&nbsp; ELIGIBILITY.</B></FONT></TD>
        <TD><FONT size="2">&nbsp;</FONT></TD>
        <TD nowrap align="right" valign="top"><FONT size="2">&nbsp;</FONT></TD>
        <TD align="right" valign="top"><FONT size="2">6</FONT></TD>
        <TD valign="top"><FONT size="2">&nbsp;</FONT></TD>
</TR>

<TR valign="bottom">
        <TD valign="top" ALIGN="RIGHT"><FONT size="2">4.1</FONT></TD>
        <TD><FONT size="2">&nbsp;</FONT></TD>
        <TD align="left" valign="top" COLSPAN="3"><FONT size="2">INCENTIVE STOCK OPTIONS
</FONT></TD>
        <TD><FONT size="2">&nbsp;</FONT></TD>
        <TD nowrap align="right" valign="top"><FONT size="2">&nbsp;</FONT></TD>
        <TD align="right" valign="top"><FONT size="2">6</FONT></TD>
        <TD valign="top"><FONT size="2">&nbsp;</FONT></TD>
</TR>

<TR valign="bottom">
        <TD valign="top" ALIGN="RIGHT"><FONT size="2">4.2</FONT></TD>
        <TD><FONT size="2">&nbsp;</FONT></TD>
        <TD align="left" valign="top" COLSPAN="3"><FONT size="2">OTHER GRANTS
</FONT></TD>
        <TD><FONT size="2">&nbsp;</FONT></TD>
        <TD nowrap align="right" valign="top"><FONT size="2">&nbsp;</FONT></TD>
        <TD align="right" valign="top"><FONT size="2">6</FONT></TD>
        <TD valign="top"><FONT size="2">&nbsp;</FONT></TD>
</TR>

<TR valign="bottom">
        <TD valign="top" ALIGN="RIGHT"><FONT size="2">4.3</FONT></TD>
        <TD><FONT size="2">&nbsp;</FONT></TD>
        <TD align="left" valign="top" COLSPAN="3"><FONT size="2">NONASSIGNABILITY
</FONT></TD>
        <TD><FONT size="2">&nbsp;</FONT></TD>
        <TD nowrap align="right" valign="top"><FONT size="2">&nbsp;</FONT></TD>
        <TD align="right" valign="top"><FONT size="2">7</FONT></TD>
        <TD valign="top"><FONT size="2">&nbsp;</FONT></TD>
</TR>

<TR valign="bottom">
        <TD valign="top" ALIGN="RIGHT"><FONT size="2">4.4</FONT></TD>
        <TD><FONT size="2">&nbsp;</FONT></TD>
        <TD align="left" valign="top" COLSPAN="3"><FONT size="2">REQUIREMENT OF NOTIFICATION OF ELECTION UNDER SECTION 83(b)<BR>
OF THE CODE
</FONT></TD>
        <TD><FONT size="2">&nbsp;</FONT></TD>
        <TD nowrap align="right" valign="top"><FONT size="2">&nbsp;</FONT></TD>
        <TD align="right" valign="bottom"><FONT size="2">7</FONT></TD>
        <TD valign="top"><FONT size="2">&nbsp;</FONT></TD>
</TR>

<TR valign="bottom">
        <TD valign="top" ALIGN="RIGHT"><FONT size="2">4.5</FONT></TD>
        <TD><FONT size="2">&nbsp;</FONT></TD>
        <TD align="left" valign="top" COLSPAN="3"><FONT size="2">REQUIREMENT OF NOTIFICATION UPON DISQUALIFYING DISPOSITION<BR>
UNDER SECTION 421(b) OF THE CODE
</FONT></TD>
        <TD><FONT size="2">&nbsp;</FONT></TD>
        <TD nowrap align="right" valign="top"><FONT size="2">&nbsp;</FONT></TD>
        <TD align="right" valign="bottom"><FONT size="2">7</FONT></TD>
        <TD valign="top"><FONT size="2">&nbsp;</FONT></TD>
</TR>

<TR valign="bottom">
        <TD valign="top" COLSPAN="5"><FONT size="2"><B>ARTICLE
5.&nbsp; OPTIONS.</B></FONT></TD>
        <TD><FONT size="2">&nbsp;</FONT></TD>
        <TD nowrap align="right" valign="top"><FONT size="2">&nbsp;</FONT></TD>
        <TD align="right" valign="top"><FONT size="2">7</FONT></TD>
        <TD valign="top"><FONT size="2">&nbsp;</FONT></TD>
</TR>

<TR valign="bottom">
        <TD valign="top" ALIGN="RIGHT"><FONT size="2">5.1</FONT></TD>
        <TD><FONT size="2">&nbsp;</FONT></TD>
        <TD align="left" valign="top" COLSPAN="3"><FONT size="2">STOCK OPTION AGREEMENT
</FONT></TD>
        <TD><FONT size="2">&nbsp;</FONT></TD>
        <TD nowrap align="right" valign="top"><FONT size="2">&nbsp;</FONT></TD>
        <TD align="right" valign="top"><FONT size="2">7</FONT></TD>
        <TD valign="top"><FONT size="2">&nbsp;</FONT></TD>
</TR>

<TR valign="bottom">
        <TD valign="top" ALIGN="RIGHT"><FONT size="2">5.2</FONT></TD>
        <TD><FONT size="2">&nbsp;</FONT></TD>
        <TD align="left" valign="top" COLSPAN="3"><FONT size="2">NUMBER OF SHARES
</FONT></TD>
        <TD><FONT size="2">&nbsp;</FONT></TD>
        <TD nowrap align="right" valign="top"><FONT size="2">&nbsp;</FONT></TD>
        <TD align="right" valign="top"><FONT size="2">7</FONT></TD>
        <TD valign="top"><FONT size="2">&nbsp;</FONT></TD>
</TR>

<TR valign="bottom">
        <TD valign="top" ALIGN="RIGHT"><FONT size="2">5.3</FONT></TD>
        <TD><FONT size="2">&nbsp;</FONT></TD>
        <TD align="left" valign="top" COLSPAN="3"><FONT size="2">EXERCISE PRICE
</FONT></TD>
        <TD><FONT size="2">&nbsp;</FONT></TD>
        <TD nowrap align="right" valign="top"><FONT size="2">&nbsp;</FONT></TD>
        <TD align="right" valign="top"><FONT size="2">8</FONT></TD>
        <TD valign="top"><FONT size="2">&nbsp;</FONT></TD>
</TR>

<TR valign="bottom">
        <TD valign="top" ALIGN="RIGHT"><FONT size="2">5.4</FONT></TD>
        <TD><FONT size="2">&nbsp;</FONT></TD>
        <TD align="left" valign="top" COLSPAN="3"><FONT size="2">EXERCISABILITY AND TERM
</FONT></TD>
        <TD><FONT size="2">&nbsp;</FONT></TD>
        <TD nowrap align="right" valign="top"><FONT size="2">&nbsp;</FONT></TD>
        <TD align="right" valign="top"><FONT size="2">8</FONT></TD>
        <TD valign="top"><FONT size="2">&nbsp;</FONT></TD>
</TR>

<TR valign="bottom">
        <TD valign="top" ALIGN="RIGHT"><FONT size="2">5.5</FONT></TD>
        <TD><FONT size="2">&nbsp;</FONT></TD>
        <TD align="left" valign="top" COLSPAN="3"><FONT size="2">MANNER OF EXERCISE
</FONT></TD>
        <TD><FONT size="2">&nbsp;</FONT></TD>
        <TD nowrap align="right" valign="top"><FONT size="2">&nbsp;</FONT></TD>
        <TD align="right" valign="top"><FONT size="2">8</FONT></TD>
        <TD valign="top"><FONT size="2">&nbsp;</FONT></TD>
</TR>

<TR valign="bottom">
        <TD valign="top" ALIGN="RIGHT"><FONT size="2">5.6</FONT></TD>
        <TD><FONT size="2">&nbsp;</FONT></TD>
        <TD align="left" valign="top" COLSPAN="3"><FONT size="2">EFFECT ON OPTION OF DEATH OR OTHER TERMINATION OF EMPLOYMENT,<BR>
DIRECTORSHIP OR CONSULTANCY
</FONT></TD>
        <TD><FONT size="2">&nbsp;</FONT></TD>
        <TD nowrap align="right" valign="top"><FONT size="2">&nbsp;</FONT></TD>
        <TD align="right" valign="bottom"><FONT size="2">9</FONT></TD>
        <TD valign="top"><FONT size="2">&nbsp;</FONT></TD>
</TR>

<TR valign="bottom">
        <TD valign="top" ALIGN="RIGHT"><FONT size="2">5.7</FONT></TD>
        <TD><FONT size="2">&nbsp;</FONT></TD>
        <TD align="left" valign="top" COLSPAN="3"><FONT size="2">EFFECT OF CHANGE IN CONTROL
</FONT></TD>
        <TD><FONT size="2">&nbsp;</FONT></TD>
        <TD nowrap align="right" valign="top"><FONT size="2">&nbsp;</FONT></TD>
        <TD align="right" valign="top"><FONT size="2">10</FONT></TD>
        <TD valign="top"><FONT size="2">&nbsp;</FONT></TD>
</TR>

<TR valign="bottom">
        <TD valign="top" ALIGN="RIGHT"><FONT size="2">5.8</FONT></TD>
        <TD><FONT size="2">&nbsp;</FONT></TD>
        <TD align="left" valign="top" COLSPAN="3"><FONT size="2">MODIFICATION OR ASSUMPTION OF OPTIONS
</FONT></TD>
        <TD><FONT size="2">&nbsp;</FONT></TD>
        <TD nowrap align="right" valign="top"><FONT size="2">&nbsp;</FONT></TD>
        <TD align="right" valign="top"><FONT size="2">10</FONT></TD>
        <TD valign="top"><FONT size="2">&nbsp;</FONT></TD>
</TR>

<TR valign="bottom">
        <TD valign="top" ALIGN="RIGHT"><FONT size="2">5.9</FONT></TD>
        <TD><FONT size="2">&nbsp;</FONT></TD>
        <TD align="left" valign="top" COLSPAN="3"><FONT size="2">BUYOUT PROVISIONS
</FONT></TD>
        <TD><FONT size="2">&nbsp;</FONT></TD>
        <TD nowrap align="right" valign="top"><FONT size="2">&nbsp;</FONT></TD>
        <TD align="right" valign="top"><FONT size="2">10</FONT></TD>
        <TD valign="top"><FONT size="2">&nbsp;</FONT></TD>
</TR>

<TR valign="bottom">
        <TD valign="top" ALIGN="RIGHT"><FONT size="2">5.10</FONT></TD>
        <TD><FONT size="2">&nbsp;</FONT></TD>
        <TD align="left" valign="top" COLSPAN="3"><FONT size="2">COMPANY&#146;S RIGHT OF FIRST REFUSAL
</FONT></TD>
        <TD><FONT size="2">&nbsp;</FONT></TD>
        <TD nowrap align="right" valign="top"><FONT size="2">&nbsp;</FONT></TD>
        <TD align="right" valign="top"><FONT size="2">10</FONT></TD>
        <TD valign="top"><FONT size="2">&nbsp;</FONT></TD>
</TR>

<TR valign="bottom">
        <TD valign="top" ALIGN="RIGHT"><FONT size="2">5.11</FONT></TD>
        <TD><FONT size="2">&nbsp;</FONT></TD>
        <TD align="left" valign="top" COLSPAN="3"><FONT size="2">COMPANY&#146;S RIGHT OF RECAPTURE
</FONT></TD>
        <TD><FONT size="2">&nbsp;</FONT></TD>
        <TD nowrap align="right" valign="top"><FONT size="2">&nbsp;</FONT></TD>
        <TD align="right" valign="top"><FONT size="2">12</FONT></TD>
        <TD valign="top"><FONT size="2">&nbsp;</FONT></TD>
</TR>

<TR valign="bottom">
        <TD valign="top" COLSPAN="5"><FONT size="2"><B>ARTICLE 6.
&nbsp;PAYMENT FOR OPTION SHARES.</B></FONT></TD>
        <TD><FONT size="2">&nbsp;</FONT></TD>
        <TD nowrap align="right" valign="top"><FONT size="2">&nbsp;</FONT></TD>
        <TD align="right" valign="top"><FONT size="2">12</FONT></TD>
        <TD valign="top"><FONT size="2">&nbsp;</FONT></TD>
</TR>

<TR valign="bottom">
        <TD valign="top" ALIGN="RIGHT"><FONT size="2">6.1</FONT></TD>
        <TD><FONT size="2">&nbsp;</FONT></TD>
        <TD align="left" valign="top" COLSPAN="3"><FONT size="2">GENERAL RULE
</FONT></TD>
        <TD><FONT size="2">&nbsp;</FONT></TD>
        <TD nowrap align="right" valign="top"><FONT size="2">&nbsp;</FONT></TD>
        <TD align="right" valign="top"><FONT size="2">12</FONT></TD>
        <TD valign="top"><FONT size="2">&nbsp;</FONT></TD>
</TR>

<TR valign="bottom">
        <TD valign="top" ALIGN="RIGHT"><FONT size="2">6.2</FONT></TD>
        <TD><FONT size="2">&nbsp;</FONT></TD>
        <TD align="left" valign="top" COLSPAN="3"><FONT size="2">SURRENDER OF STOCK
</FONT></TD>
        <TD><FONT size="2">&nbsp;</FONT></TD>
        <TD nowrap align="right" valign="top"><FONT size="2">&nbsp;</FONT></TD>
        <TD align="right" valign="top"><FONT size="2">13</FONT></TD>
        <TD valign="top"><FONT size="2">&nbsp;</FONT></TD>
</TR>

<TR valign="bottom">
        <TD valign="top" ALIGN="RIGHT"><FONT size="2">6.3</FONT></TD>
        <TD><FONT size="2">&nbsp;</FONT></TD>
        <TD align="left" valign="top" COLSPAN="3"><FONT size="2">NET EXERCISE
</FONT></TD>
        <TD><FONT size="2">&nbsp;</FONT></TD>
        <TD nowrap align="right" valign="top"><FONT size="2">&nbsp;</FONT></TD>
        <TD align="right" valign="top"><FONT size="2">13</FONT></TD>
        <TD valign="top"><FONT size="2">&nbsp;</FONT></TD>
</TR>

<TR valign="bottom">
        <TD valign="top" ALIGN="RIGHT"><FONT size="2">6.4</FONT></TD>
        <TD><FONT size="2">&nbsp;</FONT></TD>
        <TD align="left" valign="top" COLSPAN="3"><FONT size="2">EXERCISE/SALE
</FONT></TD>
        <TD><FONT size="2">&nbsp;</FONT></TD>
        <TD nowrap align="right" valign="top"><FONT size="2">&nbsp;</FONT></TD>
        <TD align="right" valign="top"><FONT size="2">14</FONT></TD>
        <TD valign="top"><FONT size="2">&nbsp;</FONT></TD>
</TR>

<TR valign="bottom">
        <TD valign="top" ALIGN="RIGHT"><FONT size="2">6.5</FONT></TD>
        <TD><FONT size="2">&nbsp;</FONT></TD>
        <TD align="left" valign="top" COLSPAN="3"><FONT size="2">EXERCISE/PLEDGE
</FONT></TD>
        <TD><FONT size="2">&nbsp;</FONT></TD>
        <TD nowrap align="right" valign="top"><FONT size="2">&nbsp;</FONT></TD>
        <TD align="right" valign="top"><FONT size="2">14</FONT></TD>
        <TD valign="top"><FONT size="2">&nbsp;</FONT></TD>
</TR>

<TR valign="bottom">
        <TD valign="top" ALIGN="RIGHT"><FONT size="2">6.6</FONT></TD>
        <TD><FONT size="2">&nbsp;</FONT></TD>
        <TD align="left" valign="top" COLSPAN="3"><FONT size="2">PROMISSORY NOTE
</FONT></TD>
        <TD><FONT size="2">&nbsp;</FONT></TD>
        <TD nowrap align="right" valign="top"><FONT size="2">&nbsp;</FONT></TD>
        <TD align="right" valign="top"><FONT size="2">14</FONT></TD>
        <TD valign="top"><FONT size="2">&nbsp;</FONT></TD>
</TR>

<TR valign="bottom">
        <TD valign="top" ALIGN="RIGHT"><FONT size="2">6.7</FONT></TD>
        <TD><FONT size="2">&nbsp;</FONT></TD>
        <TD align="left" valign="top" COLSPAN="3"><FONT size="2">OTHER FORMS OF PAYMENT
</FONT></TD>
        <TD><FONT size="2">&nbsp;</FONT></TD>
        <TD nowrap align="right" valign="top"><FONT size="2">&nbsp;</FONT></TD>
        <TD align="right" valign="top"><FONT size="2">14</FONT></TD>
        <TD valign="top"><FONT size="2">&nbsp;</FONT></TD>
</TR>

<TR valign="bottom">
        <TD valign="top" COLSPAN="5"><FONT size="2"><B>ARTICLE 7.
&nbsp;OPTION GRANTS TO OUTSIDE DIRECTORS/AFFILIATES.</B></FONT></TD>
        <TD><FONT size="2">&nbsp;</FONT></TD>
        <TD nowrap align="right" valign="top"><FONT size="2">&nbsp;</FONT></TD>
        <TD align="right" valign="top"><FONT size="2">14</FONT></TD>
        <TD valign="top"><FONT size="2">&nbsp;</FONT></TD>
</TR>

<TR valign="bottom">
        <TD valign="top" COLSPAN="5"><FONT size="2"><B>ARTICLE
8.&nbsp; STOCK APPRECIATION RIGHTS.</B></FONT></TD>
        <TD><FONT size="2">&nbsp;</FONT></TD>
        <TD nowrap align="right" valign="top"><FONT size="2">&nbsp;</FONT></TD>
        <TD align="right" valign="top"><FONT size="2">15</FONT></TD>
        <TD valign="top"><FONT size="2">&nbsp;</FONT></TD>
</TR>

<TR valign="bottom">
        <TD valign="top" ALIGN="RIGHT"><FONT size="2">8.1</FONT></TD>
        <TD><FONT size="2">&nbsp;</FONT></TD>
        <TD align="left" valign="top" COLSPAN="3"><FONT size="2">SAR AGREEMENT
</FONT></TD>
        <TD><FONT size="2">&nbsp;</FONT></TD>
        <TD nowrap align="right" valign="top"><FONT size="2">&nbsp;</FONT></TD>
        <TD align="right" valign="top"><FONT size="2">15</FONT></TD>
        <TD valign="top"><FONT size="2">&nbsp;</FONT></TD>
</TR>

<TR valign="bottom">
        <TD valign="top" ALIGN="RIGHT"><FONT size="2">8.2</FONT></TD>
        <TD><FONT size="2">&nbsp;</FONT></TD>
        <TD align="left" valign="top" COLSPAN="3"><FONT size="2">NUMBER OF SHARES
</FONT></TD>
        <TD><FONT size="2">&nbsp;</FONT></TD>
        <TD nowrap align="right" valign="top"><FONT size="2">&nbsp;</FONT></TD>
        <TD align="right" valign="top"><FONT size="2">15</FONT></TD>
        <TD valign="top"><FONT size="2">&nbsp;</FONT></TD>
</TR>

<TR valign="bottom">
        <TD valign="top" ALIGN="RIGHT"><FONT size="2">8.3</FONT></TD>
        <TD><FONT size="2">&nbsp;</FONT></TD>
        <TD align="left" valign="top" COLSPAN="3"><FONT size="2">EXERCISE PRICE
</FONT></TD>
        <TD><FONT size="2">&nbsp;</FONT></TD>
        <TD nowrap align="right" valign="top"><FONT size="2">&nbsp;</FONT></TD>
        <TD align="right" valign="top"><FONT size="2">15</FONT></TD>
        <TD valign="top"><FONT size="2">&nbsp;</FONT></TD>
</TR>

<TR valign="bottom">
        <TD valign="top" ALIGN="RIGHT"><FONT size="2">8.4</FONT></TD>
        <TD><FONT size="2">&nbsp;</FONT></TD>
        <TD align="left" valign="top" COLSPAN="3"><FONT size="2">EXERCISABILITY AND TERM
</FONT></TD>
        <TD><FONT size="2">&nbsp;</FONT></TD>
        <TD nowrap align="right" valign="top"><FONT size="2">&nbsp;</FONT></TD>
        <TD align="right" valign="top"><FONT size="2">15</FONT></TD>
        <TD valign="top"><FONT size="2">&nbsp;</FONT></TD>
</TR>

<TR valign="bottom">
        <TD valign="top" ALIGN="RIGHT"><FONT size="2">8.5</FONT></TD>
        <TD><FONT size="2">&nbsp;</FONT></TD>
        <TD align="left" valign="top" COLSPAN="3"><FONT size="2">EFFECT OF CHANGE IN CONTROL
</FONT></TD>
        <TD><FONT size="2">&nbsp;</FONT></TD>
        <TD nowrap align="right" valign="top"><FONT size="2">&nbsp;</FONT></TD>
        <TD align="right" valign="top"><FONT size="2">15</FONT></TD>
        <TD valign="top"><FONT size="2">&nbsp;</FONT></TD>
</TR>

<TR valign="bottom">
        <TD valign="top" ALIGN="RIGHT"><FONT size="2">8.6</FONT></TD>
        <TD><FONT size="2">&nbsp;</FONT></TD>
        <TD align="left" valign="top" COLSPAN="3"><FONT size="2">EXERCISE OF SARS
</FONT></TD>
        <TD><FONT size="2">&nbsp;</FONT></TD>
        <TD nowrap align="right" valign="top"><FONT size="2">&nbsp;</FONT></TD>
        <TD align="right" valign="top"><FONT size="2">16</FONT></TD>
        <TD valign="top"><FONT size="2">&nbsp;</FONT></TD>
</TR>

<TR valign="bottom">
        <TD valign="top" ALIGN="RIGHT"><FONT size="2">8.7</FONT></TD>
        <TD><FONT size="2">&nbsp;</FONT></TD>
        <TD align="left" valign="top" COLSPAN="3"><FONT size="2">MODIFICATION OR ASSUMPTION OF SARS
</FONT></TD>
        <TD><FONT size="2">&nbsp;</FONT></TD>
        <TD nowrap align="right" valign="top"><FONT size="2">&nbsp;</FONT></TD>
        <TD align="right" valign="top"><FONT size="2">16</FONT></TD>
        <TD valign="top"><FONT size="2">&nbsp;</FONT></TD>
</TR>
</TABLE>
</CENTER>
<P align="center"><FONT size="2">&nbsp;
</FONT>

<!-- PAGEBREAK -->
<P><HR noshade><P>
<H5 align="left" style="page-break-before:always"><A HREF="#toc">Table of Contents</A></H5><P>
<CENTER>
<TABLE cellspacing="0" border="0" cellpadding="0" width="100%">
<TR valign="bottom">
        <TD width="8%">&nbsp;</TD>
        <TD width="6%">&nbsp;</TD>
        <TD width="22%">&nbsp;</TD>
        <TD width="3%">&nbsp;</TD>
        <TD width="55%">&nbsp;</TD>
        <TD width="3%">&nbsp;</TD>
        <TD width="1%">&nbsp;</TD>
        <TD width="1%">&nbsp;</TD>
        <TD width="1%">&nbsp;</TD>
</TR>
<TR valign="bottom">
        <TD><FONT size="1">&nbsp;</FONT></TD>
        <TD><FONT size="1">&nbsp;</FONT></TD>
        <TD><FONT size="1">&nbsp;</FONT></TD>
        <TD><FONT size="1">&nbsp;</FONT></TD>
        <TD><FONT size="1">&nbsp;</FONT></TD>
        <TD><FONT size="1">&nbsp;</FONT></TD>
        <TD nowrap align="center" colspan="3"><FONT size="1"><B>Page</B></FONT></TD>
</TR>
<TR valign="bottom">
        <TD><FONT size="1">&nbsp;</FONT></TD>
        <TD><FONT size="1">&nbsp;</FONT></TD>
        <TD><FONT size="1">&nbsp;</FONT></TD>
        <TD><FONT size="1">&nbsp;</FONT></TD>
        <TD><FONT size="1">&nbsp;</FONT></TD>
        <TD><FONT size="1">&nbsp;</FONT></TD>
        <TD colspan="3"><HR size="1" noshade></TD>
</TR>

<TR valign="bottom">
        <TD valign="top" COLSPAN="5"><FONT size="2"><B>ARTICLE
9.&nbsp; RESTRICTED SHARES.</B></FONT></TD>
        <TD><FONT size="2">&nbsp;</FONT></TD>
        <TD nowrap align="right" valign="top"><FONT size="2">&nbsp;</FONT></TD>
        <TD align="right" valign="top"><FONT size="2">17</FONT></TD>
        <TD valign="top"><FONT size="2">&nbsp;</FONT></TD>
</TR>

<TR valign="bottom">
        <TD valign="top" ALIGN="RIGHT"><FONT size="2">9.1</FONT></TD>
        <TD><FONT size="2">&nbsp;</FONT></TD>
        <TD align="left" valign="top" COLSPAN="3"><FONT size="2">RESTRICTED STOCK AGREEMENT
</FONT></TD>
        <TD><FONT size="2">&nbsp;</FONT></TD>
        <TD nowrap align="right" valign="top"><FONT size="2">&nbsp;</FONT></TD>
        <TD align="right" valign="top"><FONT size="2">17</FONT></TD>
        <TD valign="top"><FONT size="2">&nbsp;</FONT></TD>
</TR>

<TR valign="bottom">
        <TD valign="top" ALIGN="RIGHT"><FONT size="2">9.2</FONT></TD>
        <TD><FONT size="2">&nbsp;</FONT></TD>
        <TD align="left" valign="top" COLSPAN="3"><FONT size="2">PAYMENT FOR AWARDS
</FONT></TD>
        <TD><FONT size="2">&nbsp;</FONT></TD>
        <TD nowrap align="right" valign="top"><FONT size="2">&nbsp;</FONT></TD>
        <TD align="right" valign="top"><FONT size="2">17</FONT></TD>
        <TD valign="top"><FONT size="2">&nbsp;</FONT></TD>
</TR>

<TR valign="bottom">
        <TD valign="top" ALIGN="RIGHT"><FONT size="2">9.3</FONT></TD>
        <TD><FONT size="2">&nbsp;</FONT></TD>
        <TD align="left" valign="top" COLSPAN="3"><FONT size="2">VESTING CONDITIONS
</FONT></TD>
        <TD><FONT size="2">&nbsp;</FONT></TD>
        <TD nowrap align="right" valign="top"><FONT size="2">&nbsp;</FONT></TD>
        <TD align="right" valign="top"><FONT size="2">17</FONT></TD>
        <TD valign="top"><FONT size="2">&nbsp;</FONT></TD>
</TR>

<TR valign="bottom">
        <TD valign="top" ALIGN="RIGHT"><FONT size="2">9.4</FONT></TD>
        <TD><FONT size="2">&nbsp;</FONT></TD>
        <TD align="left" valign="top" COLSPAN="3"><FONT size="2">VOTING AND DIVIDEND RIGHTS
</FONT></TD>
        <TD><FONT size="2">&nbsp;</FONT></TD>
        <TD nowrap align="right" valign="top"><FONT size="2">&nbsp;</FONT></TD>
        <TD align="right" valign="top"><FONT size="2">17</FONT></TD>
        <TD valign="top"><FONT size="2">&nbsp;</FONT></TD>
</TR>

<TR valign="bottom">
        <TD valign="top" ALIGN="RIGHT"><FONT size="2">9.5</FONT></TD>
        <TD><FONT size="2">&nbsp;</FONT></TD>
        <TD align="left" valign="top" COLSPAN="3"><FONT size="2">REPURCHASE OPTION
</FONT></TD>
        <TD><FONT size="2">&nbsp;</FONT></TD>
        <TD nowrap align="right" valign="top"><FONT size="2">&nbsp;</FONT></TD>
        <TD align="right" valign="top"><FONT size="2">17</FONT></TD>
        <TD valign="top"><FONT size="2">&nbsp;</FONT></TD>
</TR>

<TR valign="bottom">
        <TD valign="top" COLSPAN="5"><FONT size="2"><B>ARTICLE
10.&nbsp; STOCK UNITS.</B></FONT></TD>
        <TD><FONT size="2">&nbsp;</FONT></TD>
        <TD nowrap align="right" valign="top"><FONT size="2">&nbsp;</FONT></TD>
        <TD align="right" valign="top"><FONT size="2">18</FONT></TD>
        <TD valign="top"><FONT size="2">&nbsp;</FONT></TD>
</TR>

<TR valign="bottom">
        <TD valign="top" ALIGN="RIGHT"><FONT size="2">10.1</FONT></TD>
        <TD><FONT size="2">&nbsp;</FONT></TD>
        <TD align="left" valign="top" COLSPAN="3"><FONT size="2">STOCK UNIT AGREEMENT
</FONT></TD>
        <TD><FONT size="2">&nbsp;</FONT></TD>
        <TD nowrap align="right" valign="top"><FONT size="2">&nbsp;</FONT></TD>
        <TD align="right" valign="top"><FONT size="2">18</FONT></TD>
        <TD valign="top"><FONT size="2">&nbsp;</FONT></TD>
</TR>

<TR valign="bottom">
        <TD valign="top" ALIGN="RIGHT"><FONT size="2">10.2</FONT></TD>
        <TD><FONT size="2">&nbsp;</FONT></TD>
        <TD align="left" valign="top" COLSPAN="3"><FONT size="2">PAYMENT FOR AWARDS
</FONT></TD>
        <TD><FONT size="2">&nbsp;</FONT></TD>
        <TD nowrap align="right" valign="top"><FONT size="2">&nbsp;</FONT></TD>
        <TD align="right" valign="top"><FONT size="2">18</FONT></TD>
        <TD valign="top"><FONT size="2">&nbsp;</FONT></TD>
</TR>

<TR valign="bottom">
        <TD valign="top" ALIGN="RIGHT"><FONT size="2">10.3</FONT></TD>
        <TD><FONT size="2">&nbsp;</FONT></TD>
        <TD align="left" valign="top" COLSPAN="3"><FONT size="2">VESTING CONDITIONS
</FONT></TD>
        <TD><FONT size="2">&nbsp;</FONT></TD>
        <TD nowrap align="right" valign="top"><FONT size="2">&nbsp;</FONT></TD>
        <TD align="right" valign="top"><FONT size="2">18</FONT></TD>
        <TD valign="top"><FONT size="2">&nbsp;</FONT></TD>
</TR>

<TR valign="bottom">
        <TD valign="top" ALIGN="RIGHT"><FONT size="2">10.4</FONT></TD>
        <TD><FONT size="2">&nbsp;</FONT></TD>
        <TD align="left" valign="top" COLSPAN="3"><FONT size="2">VOTING AND DIVIDEND RIGHTS
</FONT></TD>
        <TD><FONT size="2">&nbsp;</FONT></TD>
        <TD nowrap align="right" valign="top"><FONT size="2">&nbsp;</FONT></TD>
        <TD align="right" valign="top"><FONT size="2">18</FONT></TD>
        <TD valign="top"><FONT size="2">&nbsp;</FONT></TD>
</TR>

<TR valign="bottom">
        <TD valign="top" ALIGN="RIGHT"><FONT size="2">10.5</FONT></TD>
        <TD><FONT size="2">&nbsp;</FONT></TD>
        <TD align="left" valign="top" COLSPAN="3"><FONT size="2">FORM AND TIME OF SETTLEMENT OF STOCK UNITS
</FONT></TD>
        <TD><FONT size="2">&nbsp;</FONT></TD>
        <TD nowrap align="right" valign="top"><FONT size="2">&nbsp;</FONT></TD>
        <TD align="right" valign="top"><FONT size="2">19</FONT></TD>
        <TD valign="top"><FONT size="2">&nbsp;</FONT></TD>
</TR>

<TR valign="bottom">
        <TD valign="top" ALIGN="RIGHT"><FONT size="2">10.6</FONT></TD>
        <TD><FONT size="2">&nbsp;</FONT></TD>
        <TD align="left" valign="top" COLSPAN="3"><FONT size="2">DEATH OF RECIPIENT
</FONT></TD>
        <TD><FONT size="2">&nbsp;</FONT></TD>
        <TD nowrap align="right" valign="top"><FONT size="2">&nbsp;</FONT></TD>
        <TD align="right" valign="top"><FONT size="2">19</FONT></TD>
        <TD valign="top"><FONT size="2">&nbsp;</FONT></TD>
</TR>

<TR valign="bottom">
        <TD valign="top" ALIGN="RIGHT"><FONT size="2">10.7</FONT></TD>
        <TD><FONT size="2">&nbsp;</FONT></TD>
        <TD align="left" valign="top" COLSPAN="3"><FONT size="2">CREDITORS&#146; RIGHTS
</FONT></TD>
        <TD><FONT size="2">&nbsp;</FONT></TD>
        <TD nowrap align="right" valign="top"><FONT size="2">&nbsp;</FONT></TD>
        <TD align="right" valign="top"><FONT size="2">19</FONT></TD>
        <TD valign="top"><FONT size="2">&nbsp;</FONT></TD>
</TR>

<TR valign="bottom">
        <TD valign="top" COLSPAN="5"><FONT size="2"><B>ARTICLE
11.&nbsp; PROTECTION AGAINST DILUTION.</B></FONT></TD>
        <TD><FONT size="2">&nbsp;</FONT></TD>
        <TD nowrap align="right" valign="top"><FONT size="2">&nbsp;</FONT></TD>
        <TD align="right" valign="top"><FONT size="2">19</FONT></TD>
        <TD valign="top"><FONT size="2">&nbsp;</FONT></TD>
</TR>

<TR valign="bottom">
        <TD valign="top" ALIGN="RIGHT"><FONT size="2">11.1</FONT></TD>
        <TD><FONT size="2">&nbsp;</FONT></TD>
        <TD align="left" valign="top" COLSPAN="3"><FONT size="2">ADJUSTMENTS
</FONT></TD>
        <TD><FONT size="2">&nbsp;</FONT></TD>
        <TD nowrap align="right" valign="top"><FONT size="2">&nbsp;</FONT></TD>
        <TD align="right" valign="top"><FONT size="2">19</FONT></TD>
        <TD valign="top"><FONT size="2">&nbsp;</FONT></TD>
</TR>

<TR valign="bottom">
        <TD valign="top" ALIGN="RIGHT"><FONT size="2">11.2</FONT></TD>
        <TD><FONT size="2">&nbsp;</FONT></TD>
        <TD align="left" valign="top" COLSPAN="3"><FONT size="2">DISSOLUTION OR LIQUIDATION
</FONT></TD>
        <TD><FONT size="2">&nbsp;</FONT></TD>
        <TD nowrap align="right" valign="top"><FONT size="2">&nbsp;</FONT></TD>
        <TD align="right" valign="top"><FONT size="2">20</FONT></TD>
        <TD valign="top"><FONT size="2">&nbsp;</FONT></TD>
</TR>

<TR valign="bottom">
        <TD valign="top" ALIGN="RIGHT"><FONT size="2">11.3</FONT></TD>
        <TD><FONT size="2">&nbsp;</FONT></TD>
        <TD align="left" valign="top" COLSPAN="3"><FONT size="2">REORGANIZATIONS
</FONT></TD>
        <TD><FONT size="2">&nbsp;</FONT></TD>
        <TD nowrap align="right" valign="top"><FONT size="2">&nbsp;</FONT></TD>
        <TD align="right" valign="top"><FONT size="2">20</FONT></TD>
        <TD valign="top"><FONT size="2">&nbsp;</FONT></TD>
</TR>

<TR valign="bottom">
        <TD valign="top" COLSPAN="5"><FONT size="2"><B>ARTICLE
12.&nbsp; DEFERRAL OF AWARDS.</B></FONT></TD>
        <TD><FONT size="2">&nbsp;</FONT></TD>
        <TD nowrap align="right" valign="top"><FONT size="2">&nbsp;</FONT></TD>
        <TD align="right" valign="top"><FONT size="2">21</FONT></TD>
        <TD valign="top"><FONT size="2">&nbsp;</FONT></TD>
</TR>

<TR valign="bottom">
        <TD valign="top" COLSPAN="5"><FONT size="2"><B>ARTICLE
13.&nbsp; AWARDS UNDER OTHER PLANS.</B></FONT></TD>
        <TD><FONT size="2">&nbsp;</FONT></TD>
        <TD nowrap align="right" valign="top"><FONT size="2">&nbsp;</FONT></TD>
        <TD align="right" valign="top"><FONT size="2">21</FONT></TD>
        <TD valign="top"><FONT size="2">&nbsp;</FONT></TD>
</TR>

<TR valign="bottom">
        <TD valign="top" COLSPAN="5"><FONT size="2"><B>ARTICLE
14.&nbsp; PAYMENT OF DIRECTOR&#146;S FEES IN SECURITIES.</B></FONT></TD>
        <TD><FONT size="2">&nbsp;</FONT></TD>
        <TD nowrap align="right" valign="top"><FONT size="2">&nbsp;</FONT></TD>
        <TD align="right" valign="top"><FONT size="2">22</FONT></TD>
        <TD valign="top"><FONT size="2">&nbsp;</FONT></TD>
</TR>

<TR valign="bottom">
        <TD valign="top" ALIGN="RIGHT"><FONT size="2">14.1</FONT></TD>
        <TD><FONT size="2">&nbsp;</FONT></TD>
        <TD align="left" valign="top" COLSPAN="3"><FONT size="2">EFFECTIVE DATE
</FONT></TD>
        <TD><FONT size="2">&nbsp;</FONT></TD>
        <TD nowrap align="right" valign="top"><FONT size="2">&nbsp;</FONT></TD>
        <TD align="right" valign="top"><FONT size="2">22</FONT></TD>
        <TD valign="top"><FONT size="2">&nbsp;</FONT></TD>
</TR>

<TR valign="bottom">
        <TD valign="top" ALIGN="RIGHT"><FONT size="2">14.2</FONT></TD>
        <TD><FONT size="2">&nbsp;</FONT></TD>
        <TD align="left" valign="top" COLSPAN="3"><FONT size="2">ELECTIONS TO RECEIVE NSOs, RESTRICTED SHARES OR STOCK UNITS
</FONT></TD>
        <TD><FONT size="2">&nbsp;</FONT></TD>
        <TD nowrap align="right" valign="top"><FONT size="2">&nbsp;</FONT></TD>
        <TD align="right" valign="top"><FONT size="2">22</FONT></TD>
        <TD valign="top"><FONT size="2">&nbsp;</FONT></TD>
</TR>

<TR valign="bottom">
        <TD valign="top" ALIGN="RIGHT"><FONT size="2">14.3</FONT></TD>
        <TD><FONT size="2">&nbsp;</FONT></TD>
        <TD align="left" valign="top" COLSPAN="3"><FONT size="2">NUMBER AND TERMS OF NSOs, RESTRICTED SHARES OR STOCK UNITS
</FONT></TD>
        <TD><FONT size="2">&nbsp;</FONT></TD>
        <TD nowrap align="right" valign="top"><FONT size="2">&nbsp;</FONT></TD>
        <TD align="right" valign="top"><FONT size="2">22</FONT></TD>
        <TD valign="top"><FONT size="2">&nbsp;</FONT></TD>
</TR>

<TR valign="bottom">
        <TD valign="top" COLSPAN="5"><FONT size="2"><B>ARTICLE
15.&nbsp; LIMITATION ON RIGHTS.</B></FONT></TD>
        <TD><FONT size="2">&nbsp;</FONT></TD>
        <TD nowrap align="right" valign="top"><FONT size="2">&nbsp;</FONT></TD>
        <TD align="right" valign="top"><FONT size="2">22</FONT></TD>
        <TD valign="top"><FONT size="2">&nbsp;</FONT></TD>
</TR>

<TR valign="bottom">
        <TD valign="top" ALIGN="RIGHT"><FONT size="2">15.1</FONT></TD>
        <TD><FONT size="2">&nbsp;</FONT></TD>
        <TD align="left" valign="top" COLSPAN="3"><FONT size="2">RETENTION RIGHTS
</FONT></TD>
        <TD><FONT size="2">&nbsp;</FONT></TD>
        <TD nowrap align="right" valign="top"><FONT size="2">&nbsp;</FONT></TD>
        <TD align="right" valign="top"><FONT size="2">22</FONT></TD>
        <TD valign="top"><FONT size="2">&nbsp;</FONT></TD>
</TR>

<TR valign="bottom">
        <TD valign="top" ALIGN="RIGHT"><FONT size="2">15.2</FONT></TD>
        <TD><FONT size="2">&nbsp;</FONT></TD>
        <TD align="left" valign="top" COLSPAN="3"><FONT size="2">STOCKHOLDERS&#146; RIGHTS
</FONT></TD>
        <TD><FONT size="2">&nbsp;</FONT></TD>
        <TD nowrap align="right" valign="top"><FONT size="2">&nbsp;</FONT></TD>
        <TD align="right" valign="top"><FONT size="2">22</FONT></TD>
        <TD valign="top"><FONT size="2">&nbsp;</FONT></TD>
</TR>

<TR valign="bottom">
        <TD valign="top" ALIGN="RIGHT"><FONT size="2">15.3</FONT></TD>
        <TD><FONT size="2">&nbsp;</FONT></TD>
        <TD align="left" valign="top" COLSPAN="3"><FONT size="2">CONDITIONS UPON ISSUANCE OF COMMON SHARES
</FONT></TD>
        <TD><FONT size="2">&nbsp;</FONT></TD>
        <TD nowrap align="right" valign="top"><FONT size="2">&nbsp;</FONT></TD>
        <TD align="right" valign="top"><FONT size="2">22</FONT></TD>
        <TD valign="top"><FONT size="2">&nbsp;</FONT></TD>
</TR>

<TR valign="bottom">
        <TD valign="top" COLSPAN="5"><FONT size="2"><B>ARTICLE
16.&nbsp; WITHHOLDING TAXES.</B></FONT></TD>
        <TD><FONT size="2">&nbsp;</FONT></TD>
        <TD nowrap align="right" valign="top"><FONT size="2">&nbsp;</FONT></TD>
        <TD align="right" valign="top"><FONT size="2">24</FONT></TD>
        <TD valign="top"><FONT size="2">&nbsp;</FONT></TD>
</TR>

<TR valign="bottom">
        <TD valign="top" ALIGN="RIGHT"><FONT size="2">16.1</FONT></TD>
        <TD><FONT size="2">&nbsp;</FONT></TD>
        <TD align="left" valign="top" COLSPAN="3"><FONT size="2">GENERAL
</FONT></TD>
        <TD><FONT size="2">&nbsp;</FONT></TD>
        <TD nowrap align="right" valign="top"><FONT size="2">&nbsp;</FONT></TD>
        <TD align="right" valign="top"><FONT size="2">24</FONT></TD>
        <TD valign="top"><FONT size="2">&nbsp;</FONT></TD>
</TR>

<TR valign="bottom">
        <TD valign="top" ALIGN="RIGHT"><FONT size="2">16.2</FONT></TD>
        <TD><FONT size="2">&nbsp;</FONT></TD>
        <TD align="left" valign="top" COLSPAN="3"><FONT size="2">SHARE WITHHOLDING
</FONT></TD>
        <TD><FONT size="2">&nbsp;</FONT></TD>
        <TD nowrap align="right" valign="top"><FONT size="2">&nbsp;</FONT></TD>
        <TD align="right" valign="top"><FONT size="2">24</FONT></TD>
        <TD valign="top"><FONT size="2">&nbsp;</FONT></TD>
</TR>

<TR valign="bottom">
        <TD valign="top" COLSPAN="5"><FONT size="2"><B>ARTICLE
17.&nbsp; FUTURE OF THE PLAN.</B></FONT></TD>
        <TD><FONT size="2">&nbsp;</FONT></TD>
        <TD nowrap align="right" valign="top"><FONT size="2">&nbsp;</FONT></TD>
        <TD align="right" valign="top"><FONT size="2">24</FONT></TD>
        <TD valign="top"><FONT size="2">&nbsp;</FONT></TD>
</TR>

<TR valign="bottom">
        <TD valign="top" ALIGN="RIGHT"><FONT size="2">17.1</FONT></TD>
        <TD><FONT size="2">&nbsp;</FONT></TD>
        <TD align="left" valign="top" COLSPAN="3"><FONT size="2">TERM OF THE PLAN
</FONT></TD>
        <TD><FONT size="2">&nbsp;</FONT></TD>
        <TD nowrap align="right" valign="top"><FONT size="2">&nbsp;</FONT></TD>
        <TD align="right" valign="top"><FONT size="2">24</FONT></TD>
        <TD valign="top"><FONT size="2">&nbsp;</FONT></TD>
</TR>

<TR valign="bottom">
        <TD valign="top" ALIGN="RIGHT"><FONT size="2">17.2</FONT></TD>
        <TD><FONT size="2">&nbsp;</FONT></TD>
        <TD align="left" valign="top" COLSPAN="3"><FONT size="2">AMENDMENT OR TERMINATION
</FONT></TD>
        <TD><FONT size="2">&nbsp;</FONT></TD>
        <TD nowrap align="right" valign="top"><FONT size="2">&nbsp;</FONT></TD>
        <TD align="right" valign="top"><FONT size="2">24</FONT></TD>
        <TD valign="top"><FONT size="2">&nbsp;</FONT></TD>
</TR>

<TR valign="bottom">
        <TD valign="top" ALIGN="RIGHT"><FONT size="2">17.3</FONT></TD>
        <TD><FONT size="2">&nbsp;</FONT></TD>
        <TD align="left" valign="top" COLSPAN="3"><FONT size="2">STOCKHOLDER APPROVAL
</FONT></TD>
        <TD><FONT size="2">&nbsp;</FONT></TD>
        <TD nowrap align="right" valign="top"><FONT size="2">&nbsp;</FONT></TD>
        <TD align="right" valign="top"><FONT size="2">25</FONT></TD>
        <TD valign="top"><FONT size="2">&nbsp;</FONT></TD>
</TR>

<TR valign="bottom">
        <TD valign="top" ALIGN="RIGHT"><FONT size="2">17.4</FONT></TD>
        <TD><FONT size="2">&nbsp;</FONT></TD>
        <TD align="left" valign="top" COLSPAN="3"><FONT size="2">EFFECT OF AMENDMENT OR TERMINATION
</FONT></TD>
        <TD><FONT size="2">&nbsp;</FONT></TD>
        <TD nowrap align="right" valign="top"><FONT size="2">&nbsp;</FONT></TD>
        <TD align="right" valign="top"><FONT size="2">25</FONT></TD>
        <TD valign="top"><FONT size="2">&nbsp;</FONT></TD>
</TR>

<TR valign="bottom">
        <TD valign="top" COLSPAN="5"><FONT size="2"><B>ARTICLE
18.&nbsp; LIMITATION ON PARACHUTE PAYMENTS.</B></FONT></TD>
        <TD><FONT size="2">&nbsp;</FONT></TD>
        <TD nowrap align="right" valign="top"><FONT size="2">&nbsp;</FONT></TD>
        <TD align="right" valign="top"><FONT size="2">25</FONT></TD>
        <TD valign="top"><FONT size="2">&nbsp;</FONT></TD>
</TR>

<TR valign="bottom">
        <TD valign="top" ALIGN="RIGHT"><FONT size="2">18.1</FONT></TD>
        <TD><FONT size="2">&nbsp;</FONT></TD>
        <TD align="left" valign="top" COLSPAN="3"><FONT size="2">SCOPE OF LIMITATION
</FONT></TD>
        <TD><FONT size="2">&nbsp;</FONT></TD>
        <TD nowrap align="right" valign="top"><FONT size="2">&nbsp;</FONT></TD>
        <TD align="right" valign="top"><FONT size="2">25</FONT></TD>
        <TD valign="top"><FONT size="2">&nbsp;</FONT></TD>
</TR>

<TR valign="bottom">
        <TD valign="top" ALIGN="RIGHT"><FONT size="2">18.2</FONT></TD>
        <TD><FONT size="2">&nbsp;</FONT></TD>
        <TD align="left" valign="top" COLSPAN="3"><FONT size="2">BASIC RULE
</FONT></TD>
        <TD><FONT size="2">&nbsp;</FONT></TD>
        <TD nowrap align="right" valign="top"><FONT size="2">&nbsp;</FONT></TD>
        <TD align="right" valign="top"><FONT size="2">25</FONT></TD>
        <TD valign="top"><FONT size="2">&nbsp;</FONT></TD>
</TR>

<TR valign="bottom">
        <TD valign="top" ALIGN="RIGHT"><FONT size="2">18.3</FONT></TD>
        <TD><FONT size="2">&nbsp;</FONT></TD>
        <TD align="left" valign="top" COLSPAN="3"><FONT size="2">REDUCTION OF PAYMENTS
</FONT></TD>
        <TD><FONT size="2">&nbsp;</FONT></TD>
        <TD nowrap align="right" valign="top"><FONT size="2">&nbsp;</FONT></TD>
        <TD align="right" valign="top"><FONT size="2">25</FONT></TD>
        <TD valign="top"><FONT size="2">&nbsp;</FONT></TD>
</TR>

<TR valign="bottom">
        <TD valign="top" ALIGN="RIGHT"><FONT size="2">18.4</FONT></TD>
        <TD><FONT size="2">&nbsp;</FONT></TD>
        <TD align="left" valign="top" COLSPAN="3"><FONT size="2">OVERPAYMENTS AND UNDERPAYMENTS
</FONT></TD>
        <TD><FONT size="2">&nbsp;</FONT></TD>
        <TD nowrap align="right" valign="top"><FONT size="2">&nbsp;</FONT></TD>
        <TD align="right" valign="top"><FONT size="2">26</FONT></TD>
        <TD valign="top"><FONT size="2">&nbsp;</FONT></TD>
</TR>

<TR valign="bottom">
        <TD valign="top" ALIGN="RIGHT"><FONT size="2">18.5</FONT></TD>
        <TD><FONT size="2">&nbsp;</FONT></TD>
        <TD align="left" valign="top" COLSPAN="3"><FONT size="2">RELATED CORPORATIONS
</FONT></TD>
        <TD><FONT size="2">&nbsp;</FONT></TD>
        <TD nowrap align="right" valign="top"><FONT size="2">&nbsp;</FONT></TD>
        <TD align="right" valign="top"><FONT size="2">26</FONT></TD>
        <TD valign="top"><FONT size="2">&nbsp;</FONT></TD>
</TR>

<TR valign="bottom">
        <TD valign="top" COLSPAN="5"><FONT size="2"><B>ARTICLE
19.&nbsp; INDEMNIFICATION.</B></FONT></TD>
        <TD><FONT size="2">&nbsp;</FONT></TD>
        <TD nowrap align="right" valign="top"><FONT size="2">&nbsp;</FONT></TD>
        <TD align="right" valign="top"><FONT size="2">26</FONT></TD>
        <TD valign="top"><FONT size="2">&nbsp;</FONT></TD>
</TR>

<TR valign="bottom">
        <TD valign="top" COLSPAN="5"><FONT size="2"><B>ARTICLE
20.&nbsp; PROVISION OF INFORMATION.</B></FONT></TD>
        <TD><FONT size="2">&nbsp;</FONT></TD>
        <TD nowrap align="right" valign="top"><FONT size="2">&nbsp;</FONT></TD>
        <TD align="right" valign="top"><FONT size="2">27</FONT></TD>
        <TD valign="top"><FONT size="2">&nbsp;</FONT></TD>
</TR>

<TR valign="bottom">
        <TD valign="top" COLSPAN="5"><FONT size="2"><B>ARTICLE
21.&nbsp; ADMINISTRATION.</B></FONT></TD>
        <TD><FONT size="2">&nbsp;</FONT></TD>
        <TD nowrap align="right" valign="top"><FONT size="2">&nbsp;</FONT></TD>
        <TD align="right" valign="top"><FONT size="2">27</FONT></TD>
        <TD valign="top"><FONT size="2">&nbsp;</FONT></TD>
</TR>

<TR valign="bottom">
        <TD valign="top" ALIGN="RIGHT"><FONT size="2">21.1</FONT></TD>
        <TD><FONT size="2">&nbsp;</FONT></TD>
        <TD align="left" valign="top" COLSPAN="3"><FONT size="2">COMMITTEE COMPOSITION
</FONT></TD>
        <TD><FONT size="2">&nbsp;</FONT></TD>
        <TD nowrap align="right" valign="top"><FONT size="2">&nbsp;</FONT></TD>
        <TD align="right" valign="top"><FONT size="2">27</FONT></TD>
        <TD valign="top"><FONT size="2">&nbsp;</FONT></TD>
</TR>

<TR valign="bottom">
        <TD valign="top" ALIGN="RIGHT"><FONT size="2">21.2</FONT></TD>
        <TD><FONT size="2">&nbsp;</FONT></TD>
        <TD align="left" valign="top" COLSPAN="3"><FONT size="2">POWERS OF THE BOARD
</FONT></TD>
        <TD><FONT size="2">&nbsp;</FONT></TD>
        <TD nowrap align="right" valign="top"><FONT size="2">&nbsp;</FONT></TD>
        <TD align="right" valign="top"><FONT size="2">28</FONT></TD>
        <TD valign="top"><FONT size="2">&nbsp;</FONT></TD>
</TR>

<TR valign="bottom">
        <TD valign="top" ALIGN="RIGHT"><FONT size="2">21.3</FONT></TD>
        <TD><FONT size="2">&nbsp;</FONT></TD>
        <TD align="left" valign="top" COLSPAN="3"><FONT size="2">COMMITTEE FOR NON-OFFICER GRANTS
</FONT></TD>
        <TD><FONT size="2">&nbsp;</FONT></TD>
        <TD nowrap align="right" valign="top"><FONT size="2">&nbsp;</FONT></TD>
        <TD align="right" valign="top"><FONT size="2">29</FONT></TD>
        <TD valign="top"><FONT size="2">&nbsp;</FONT></TD>
</TR>

<TR valign="bottom">
        <TD valign="top" COLSPAN="5"><FONT size="2"><B>ARTICLE
22.&nbsp; EXECUTION.</B></FONT></TD>
        <TD><FONT size="2">&nbsp;</FONT></TD>
        <TD nowrap align="right" valign="top"><FONT size="2">&nbsp;</FONT></TD>
        <TD align="right" valign="top"><FONT size="2">29</FONT></TD>
        <TD valign="top"><FONT size="2">&nbsp;</FONT></TD>
</TR>
</TABLE>
</CENTER>
<P align="center"><FONT size="2">&nbsp;
</FONT>

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<P align="center"><FONT size="2"><B>ADVANCED BIOTHERAPY, INC.</B></FONT>

<P align="center"><FONT size="2"><B>2000 OMNIBUS EQUITY INCENTIVE PLAN</B></FONT>

<P align="left"><FONT size="2"><B>ARTICLE 1. INTRODUCTION.</B></FONT>

<P><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;The purpose of the Plan is to promote the long-term success of the Company
and the creation of stockholder value by (a)&nbsp;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)&nbsp;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
&#147;Article&nbsp;2 &#150; Definitions.&#148;
</FONT>
<P><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;The Plan shall be governed by, and construed in accordance with, the laws
of the State of California.
</FONT>
<P align="left"><FONT size="2"><B>ARTICLE 2. DEFINITIONS.</B></FONT>

<P><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;2.1 &#147;AFFILIATE&#148; 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.
</FONT>
<P><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;2.2 &#147;AWARD&#148; means any award of an Option, an SAR, a Restricted Share or a
Stock Unit under the Plan.
</FONT>
<P><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;2.3 &#147;BOARD&#148; means the Company&#146;s Board of Directors, as constituted from
time to time.
</FONT>
<P><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;2.4 &#147;CHANGE IN CONTROL&#148; shall mean:
</FONT>
<P align="left"><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;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&#146;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;
</FONT>

<P align="center"><FONT size="2">A-1
</FONT>

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<P align="left"><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;b. The sale, transfer or other disposition of all or substantially all of
the Company&#146;s assets, if more than fifty percent (50%) of the combined voting
power of the acquiring entity&#146;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;
</FONT>

<P align="left"><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;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 &#147;continuing director&#148; means at any date a member of the Board (i)&nbsp;who was
a member of the Board on the date of the initial adoption of the Plan by the
Board or (ii)&nbsp;who was nominated or elected subsequent to such date by (x)&nbsp;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; <U>provided, however,</U> that there shall
be excluded from this clause (ii)&nbsp;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
</FONT>

<P align="left"><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;d. Any transaction as a result of which any person is the &#147;beneficial
owner&#148; (as defined in Rule&nbsp;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
&#147;Outstanding Company Voting Securities&#148;). For purposes of this Paragraph (d),
the term &#147;person&#148; shall have the same meaning as when used in sections 13(d)
and 14(d) of the Exchange Act but shall exclude (i)&nbsp;a trustee or other
fiduciary holding securities under an employee benefit plan of the Company or
of a Parent or Subsidiary and (ii)&nbsp;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)&nbsp;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)&nbsp;any acquisition by any employee
benefit plan (or related trust) sponsored or maintained by the Company or any
corporation controlled by the Company.
</FONT>

<P><FONT size="2">A transaction shall not constitute a Change in Control if its sole purpose is
to change the state of the Company&#146;s incorporation or to create a holding
company that will be owned
</FONT>
<P align="center"><FONT size="2">A-2
</FONT>

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<P><FONT size="2"> in substantially the same proportions by the persons
who held the Company&#146;s securities immediately before such transaction.
</FONT>
<P><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;2.5 &#147;CODE&#148; means the Internal Revenue Code of 1986, as amended.
</FONT>
<P><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;2.6 &#147;COMMITTEE&#148; means a committee of the Board, as described in Article&nbsp;21.
</FONT>
<P><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;2.7 &#147;COMMON SHARE&#148; means one share of the common stock of the Company.
</FONT>
<P><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;2.8 &#147;COMPANY&#148; means Advanced Biotherapy, Inc., a Delaware corporation.
</FONT>
<P><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;2.9 &#147;CONSULTANT&#148; means any person, including an advisor, engaged by the
Company or an Affiliate to render consulting services and who is compensated
for such services, provided that the term &#147;Consultant&#148; shall not include
Outside Directors who are paid only a director&#146;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&nbsp;4.1.
</FONT>
<P><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;2.10 &#147;EMPLOYEE&#148; 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&#146;s fee by the
Company shall alone be sufficient to constitute &#147;employment&#148; by the Company.
</FONT>
<P><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;2.11 &#147;EXCHANGE ACT&#148; means the Securities Exchange Act of 1934, as amended.
</FONT>
<P><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;2.12 &#147;EXERCISE PRICE,&#148; 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. &#147;Exercise Price,&#148; 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.
</FONT>
<P><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;2.13 &#147;FAIR MARKET VALUE&#148; means with respect to each Common Share the last
reported sale price of the Company&#146;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)&nbsp;on the date which
the notice of exercise is deemed to have been sent to the Company (the &#147;Notice
Date&#148;) or (ii)&nbsp;over a period of five (5)&nbsp;trading days preceding the Notice
Date, whichever of (i)&nbsp;or (ii)&nbsp;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
</FONT>
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<P><FONT size="2"> 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&#146;s Common Shares for each share
thereof pursuant to the Company&#146;s acquisition. Such determination shall be
conclusive and binding on all persons.
</FONT>
<P><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;2.14 &#147;ISO&#148; means an incentive stock option described in Section&nbsp;422(b) of
the Code.
</FONT>
<P><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;2.15 &#147;NSO&#148; means a stock option not described in Sections&nbsp;422 or 423 of
the Code.
</FONT>
<P><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;2.16 &#147;OPTION&#148; means an ISO or NSO granted under the Plan and entitling the
holder to purchase Common Shares.
</FONT>
<P><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;2.17 &#147;OPTIONEE&#148; means an individual or estate who holds an Option or SAR.
</FONT>
<P><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;2.18 &#147;OUTSIDE DIRECTOR&#148; 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&nbsp;4.1.
</FONT>
<P><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;2.19 &#147;PARENT&#148; 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.
</FONT>
<P><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;2.20 &#147;PARTICIPANT&#148; means an individual or estate who holds an Award.
</FONT>
<P><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;2.21 &#147;PLAN&#148; means this Advanced Biotherapy, Inc. 2000 Omnibus Equity
Incentive Plan, as amended from time to time.
</FONT>
<P><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;2.22 &#147;RESTRICTED SHARE&#148; means a Common Share awarded under the Plan,
subject to the Restricted Stock Agreement.
</FONT>
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<P><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;2.23 &#147;RESTRICTED STOCK AGREEMENT&#148; 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.
</FONT>
<P><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;2.24 &#147;SAR&#148; means a stock appreciation right granted under the Plan.
</FONT>
<P><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;2.25 &#147;SAR AGREEMENT&#148; means the agreement between the Company and an
Optionee which contains the terms, conditions and restrictions pertaining to
his or her SAR.
</FONT>
<P><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;2.26 &#147;SERVICE PROVIDER&#148; means any provider of services to the Company for
which the individual or the individual&#146;s employer or company is compensated,
and includes employees, directors and consultants.
</FONT>
<P><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;2.27 &#147;STOCK OPTION AGREEMENT&#148; means the agreement between the Company and
an Optionee that contains the terms, conditions and restrictions pertaining to
his or her Option.
</FONT>
<P><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;2.28 &#147;STOCK UNIT&#148; means a bookkeeping entry representing the equivalent of
one Common Share, as awarded under the Plan.
</FONT>
<P><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;2.29 &#147;STOCK UNIT AGREEMENT&#148; 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.
</FONT>
<P><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;2.30 &#147;SUBSIDIARY&#148; 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.
</FONT>
<P align="left"><FONT size="2"><B>ARTICLE 3. SHARES AVAILABLE FOR GRANTS.</B></FONT>

<P><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;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) &#091;Four Million (4,000,000)&#093;
Common Shares plus (b)&nbsp;the additional Common Shares described in Sections&nbsp;3.2
and 3.3. The limitation of this Section&nbsp;3.1 shall be subject to adjustment
pursuant to Article&nbsp;11.
</FONT>
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<P><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;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)&nbsp;two and one-half percent (2.5%)
of the total number of Common Shares then outstanding or (b) &#091;250,000&#093; Common
Shares. At no time shall (a)&nbsp;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)&nbsp;the amount of
securities offered and sold under the Plan exceed the limitations provided in
Rule&nbsp;701 under the Securities Act of 1933, as amended.
</FONT>
<P><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;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&nbsp;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&nbsp;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.
</FONT>
<P><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;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.
</FONT>
<P align="left"><FONT size="2"><B>ARTICLE 4. ELIGIBILITY.</B></FONT>

<P><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;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.
</FONT>
<P><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;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.
</FONT>
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<P><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;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&#146;s legal representative.
</FONT>
<P><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;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&nbsp;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&nbsp;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)&nbsp;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&nbsp;83(b).
</FONT>
<P><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;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&nbsp;421(b) of the code (relating to
certain disqualifying dispositions), such Participant shall notify the Company
of such disposition within 10&nbsp;days thereof.
</FONT>
<P align="left"><FONT size="2"><B>ARTICLE 5. OPTIONS.</B></FONT>

<P><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;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&#146;s other compensation. A Stock Option Agreement may provide
that a new 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&nbsp;6.2.
</FONT>
<P><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;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&nbsp;11.
</FONT>
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<P><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;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.
</FONT>
<P><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;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)&nbsp;years from the date of grant. A Stock Option Agreement may provide
for accelerated exercisability in the event of the Optionee&#146;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&#146;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.
</FONT>
<P><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;5.5 MANNER OF EXERCISE. An Option shall be deemed exercised when the
Company receives: (i)&nbsp;notice of exercise (in accordance with the Stock Option
Agreement) from the person entitled to exercise the Option, and (ii)&nbsp;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&nbsp;11 of the Plan.
</FONT>
<P><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;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.
</FONT>
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<P><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;5.6 EFFECT ON OPTION OF DEATH OR OTHER TERMINATION OF EMPLOYMENT,
DIRECTORSHIP OR CONSULTANCY.
</FONT>
<P align="left"><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;a. In the event of termination of the employment, directorship or
consultancy (as applicable) of a Participant, including, without limitation,
retirement other than (i)&nbsp;a termination for cause, or (ii)&nbsp;a termination by
reason of disability as determined by the Board in accordance with applicable
Company personnel policies (&#147;Disability&#148;) or death, the Participant may
exercise his Option at any time within three (3)&nbsp;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; <U>provided, however,</U> that in no event shall such
exercise right expire fewer than thirty (30)&nbsp;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. &#147;Termination for cause&#148; 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.
</FONT>

<P align="left"><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;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)&nbsp;months after
termination thereof), such Option (unless it shall have been previously
terminated pursuant to the provisions of clause (a)&nbsp;above) may be exercised (to
the extent the Participant&#146;s Option was exercisable at the date of death or
Disability) by a beneficiary or beneficiaries of such Participant under the
Participant&#146;s will, or by his personal representatives or distributees or such
Participant (as applicable), at any time within a period of six (6)&nbsp;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)&nbsp;months after the date of termination of employment,
consultancy or directorship (as applicable).
</FONT>

<P align="left"><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;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
</FONT>

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<P><FONT size="2">the transfer and the acceptance by the
transferee or transferees of the terms and conditions of such Option.
</FONT>
<P><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;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 with respect to the Company, subject to Section&nbsp;11.1
below and subject to the following limitations:
</FONT>
<P align="left"><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;a. In the case of an ISO, the acceleration of exercisability shall not
occur without the Optionee&#146;s written consent.
</FONT>

<P align="left"><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;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 &#147;pooling of
interests&#148; 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&#146;s independent accountants and such other party&#146;s
independent accountants separately determine in good faith that such
acceleration would preclude the use of &#147;pooling of interests&#148; accounting.
</FONT>

<P><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;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.
</FONT>
<P><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;5.9 BUYOUT PROVISIONS. The Committee may at any time (a)&nbsp;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.
</FONT>
<P><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;5.10 COMPANY&#146;S RIGHT OF FIRST REFUSAL. Before any Common Shares held by
Optionee or any transferee (either being sometimes referred to herein as the
&#147;Holder&#148;) 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 &#147;Right of First Refusal&#148;).
</FONT>
<P align="left"><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;a. <U>Notice of Proposed Transfer.</U> The Holder of the Common Shares shall
deliver to the Company a written notice (the &#147;Notice&#148;) stating: (i)&nbsp;the
Holder&#146;s
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<P><FONT size="2">bona fide intention to sell or otherwise transfer such Common Shares;
(ii)&nbsp;the name of each proposed purchaser or other transferee (the &#147;Proposed
Transferee&#148;); (iii)&nbsp;the number of Common Shares to be transferred to each
Proposed Transferee; and (iv)&nbsp;the bona fide cash price or other consideration
for which the Holder proposes to transfer the Common Shares (the &#147;Offered
Price&#148;), and the Holder shall offer the Common Shares at the Offered Price to
the Company or its assignee(s).
</FONT>
<P align="left"><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;b. <U>Exercise of Right of First Refusal.</U> 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 transferred to any one or more of the
Proposed Transferees, at the purchase price determined in accordance with
subsection (c)&nbsp;below.
</FONT>

<P align="left"><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;c. <U>Purchase Price.</U> The purchase price (the &#147;Purchase Price&#148;) 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.
</FONT>

<P align="left"><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;d. <U>Payment.</U> 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&nbsp;days after receipt of the Notice or in the manner and at the
times set forth in the Notice.
</FONT>

<P align="left"><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;e. <U>Holder&#146;s Right to Transfer.</U> 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&nbsp;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.
</FONT>

<P align="left"><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;f. <U>Exception for Certain Family Transfers.</U> Anything to the contrary
contained in this Section notwithstanding, the transfer of any or all of the
Common Shares during the Optionee&#146;s lifetime or on the Optionee&#146;s death by will
or intestacy to the Optionee&#146;s immediate family or to trusts established, in
whole or in part, for the
</FONT>

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<P><FONT size="2">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)&nbsp;the term &#147;immediate family&#148; shall mean the
Optionee&#146;s spouse and issue (including adopted and stepchildren) and (ii)&nbsp;the
phrase &#147;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&#148; 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&nbsp;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.
</FONT>
<P align="left"><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;g. <U>Termination of Right of First Refusal.</U> The Right of First Refusal
shall terminate upon the earlier of (i)&nbsp;two (2)&nbsp;years after the date of
issuance to the Optionee of such Common Shares or (ii)&nbsp;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.
</FONT>

<P><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;5.11 COMPANY&#146;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)&nbsp;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 &#147;realization event&#148;), 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).
</FONT>
<P align="left"><FONT size="2"><B>ARTICLE 6. PAYMENT FOR OPTION SHARES.</B></FONT>

<P><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;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:
</FONT>
<P align="left"><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;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.
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<P><FONT size="2">The Stock Option Agreement may specify that payment may be made in
any form(s) described in this Article&nbsp;6.
</FONT>
<P align="left"><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;b. In the case of an NSO, the Committee may at any time accept payment in
any form(s) described in this Article&nbsp;6.
</FONT>

<P><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;6.2 SURRENDER OF STOCK. To the extent that this Section&nbsp;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.
</FONT>
<P><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;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 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:
</FONT>
<P align="center"><FONT size="2"><U>X=Y(A-B)</U><BR>
A</FONT>

<P><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Where X = the number of Common Shares to be issued to the Holder;
</FONT>
<P align="left"><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Y = the number of Common Shares underlying the Option to be
exercised;
</FONT>

<P align="left"><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;A = the current fair market value of one Common Share; and
</FONT>

<P align="left"><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;B = the Exercise Price of the Option.
</FONT>

<P><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;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&#146;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 (&#147;NASDAQ&#148;), 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 &#147;Notice Date&#148;) or (ii)&nbsp;over a period of five (5)&nbsp;trading days
</FONT>
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<P><FONT size="2">preceding the Notice Date, whichever of (i)&nbsp;or (ii)&nbsp;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&#146;s Common Shares for each share
thereof pursuant to the Company&#146;s acquisition.
</FONT>
<P><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;6.4 EXERCISE/SALE. To the extent that this Section&nbsp;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.
</FONT>
<P><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;6.5 EXERCISE/PLEDGE. To the extent that this Section&nbsp;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 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.
</FONT>
<P><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;6.6 PROMISSORY NOTE. To the extent that this Section&nbsp;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.
</FONT>
<P><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;6.7 OTHER FORMS OF PAYMENT. To the extent that this Section&nbsp;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.
</FONT>
<P align="left"><FONT size="2"><B>ARTICLE 7. OPTION GRANTS TO OUTSIDE DIRECTORS/AFFILIATES.</B></FONT>

<P><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;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
</FONT>
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<P><FONT size="2"> termination provisions pertaining to the NSOs shall
be applied with regard to the service of the Outside Director.
</FONT>
<P align="left"><FONT size="2"><B>ARTICLE 8. STOCK APPRECIATION RIGHTS.</B></FONT>

<P><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;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&#146;s other compensation.
</FONT>
<P><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;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&nbsp;11.
</FONT>
<P><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;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.
</FONT>
<P><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;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&#146;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&#146;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 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.
</FONT>
<P><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;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&nbsp;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 &#147;pooling of interests&#148; 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&#146;s independent accountants and
such other party&#146;s independent accountants separately determine in good faith
that such acceleration would preclude the use of &#147;pooling of interests&#148;
accounting.
</FONT>
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<P><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;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)&nbsp;Common Shares, (b)&nbsp;cash or (c)&nbsp;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.
</FONT>
<P><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;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.
</FONT>
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<P align="left"><FONT size="2"><B>ARTICLE 9. RESTRICTED SHARES.</B></FONT>

<P><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;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.
</FONT>
<P><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;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 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.
</FONT>
<P><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;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&#146;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 &#147;pooling of interests&#148; 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&#146;s independent accountants and
such other party&#146;s independent accountants separately determine in good faith
that such acceleration would preclude the use of &#147;pooling of interests&#148;
accounting.
</FONT>
<P><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;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&#146;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.
</FONT>
<P><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;9.5 REPURCHASE OPTION. Unless the Committee determines otherwise, the
Restricted Stock Agreement shall grant the Company a repurchase option
exercisable
</FONT>
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<P><FONT size="2"> upon the voluntary or involuntary termination of the purchaser&#146;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.
</FONT>
<P align="left"><FONT size="2"><B>ARTICLE 10. STOCK UNITS.</B></FONT>

<P><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;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&#146;s other compensation.
</FONT>
<P><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;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.
</FONT>
<P><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;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&#146;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&nbsp;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 &#147;pooling of interests&#148; 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&#146;s independent accountants and
such other party&#146;s independent accountants separately determine in good faith
that such acceleration would preclude the use of &#147;pooling of interests&#148;
accounting.
</FONT>
<P><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;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&#146;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.
</FONT>
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<P><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;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.
</FONT>
<P><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;10.5 FORM AND TIME OF SETTLEMENT OF STOCK UNITS. Settlement of vested
Stock Units may be made in the form of (a)&nbsp;cash, (b)&nbsp;Common Shares or (c)&nbsp;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&nbsp;11.
</FONT>
<P><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;10.6 DEATH OF RECIPIENT. Any Stock Units Award that becomes payable after
the recipient&#146;s death shall be distributed to the recipient&#146;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&#146;s
death. If no beneficiary was designated or if no designated beneficiary
survives the Award recipient, then any Stock Units Award that becomes payable
after the recipient&#146;s death shall be distributed to the recipient&#146;s estate.
</FONT>
<P><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;10.7 CREDITORS&#146; 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.
</FONT>
<P align="left"><FONT size="2"><B>ARTICLE 11. PROTECTION AGAINST DILUTION.</B></FONT>

<P><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;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:
</FONT>
<P align="left"><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;a. The number of Options, SARs, Restricted Shares and Stock Units
available for future Awards under Article&nbsp;3;
</FONT>

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<P align="left"><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;b. The limitations set forth in Sections&nbsp;5.2 and 8.2;
</FONT>

<P align="left"><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;c. The number of NSOs to be granted to Outside Directors under Article&nbsp;7;
</FONT>

<P align="left"><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;d. The number of Common Shares covered by each outstanding Option and SAR;
</FONT>

<P align="left"><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;e. The Exercise Price under each outstanding Option and SAR; or
</FONT>

<P align="left"><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;f. The number of Stock Units included in any prior Award which has not yet
been settled.
</FONT>

<P><FONT size="2">Except as provided in this Article&nbsp;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.
</FONT>
<P><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;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.
</FONT>
<P><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;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 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:
</FONT>
<P align="left"><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;a.. The continuation of the outstanding Awards by the Company, if the
Company is a surviving corporation;
</FONT>

<P align="left"><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;b. The assumption of the outstanding Awards by the surviving corporation
or its parent or subsidiary;
</FONT>

<P align="left"><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;c. The substitution by the surviving corporation or its parent or
subsidiary of its own awards for the outstanding Awards;
</FONT>

<P align="left"><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;d. Full exercisability or vesting and accelerated expiration of the
outstanding Awards; or
</FONT>

<P align="left"><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;e. Settlement of the full value of the outstanding Awards in cash or cash
equivalents followed by cancellation of such Awards.
</FONT>

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<P><FONT size="2">Notwithstanding anything to the contrary herein, this Section&nbsp;11.3 shall
control in the event of a Change in Control.
</FONT>
<P><FONT size="2"><B>ARTICLE 12. DEFERRAL OF AWARDS.</B>
</FONT>
<P><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;The Committee, in its sole discretion, may permit or require a Participant
to:
</FONT>
<P align="left"><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;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&#146;s books;
</FONT>

<P align="left"><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;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
</FONT>

<P align="left"><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;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&#146;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.
</FONT>

<P><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;A deferred compensation account established under this Article&nbsp;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 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&nbsp;12.
</FONT>
<P align="left"><FONT size="2"><B>ARTICLE 13. AWARDS UNDER OTHER PLANS.</B></FONT>

<P><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;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&nbsp;3.
</FONT>
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<P align="left"><FONT size="2"><B>ARTICLE 14. PAYMENT OF DIRECTOR&#146;S FEES IN SECURITIES.</B></FONT>

<P><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;14.1 EFFECTIVE DATE. No provision of this Article&nbsp;14 shall be effective
unless and until the Board has determined to implement such provision.
</FONT>
<P><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;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&nbsp;14 shall be filed with the Company on the
prescribed form.
</FONT>
<P><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;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.
</FONT>
<P align="left"><FONT size="2"><B>ARTICLE 15. LIMITATION ON RIGHTS.</B></FONT>

<P><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;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&#146;s certificate of incorporation and by-laws and a
written employment agreement (if any).
</FONT>
<P><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;15.2 STOCKHOLDERS&#146; 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 made
for cash dividends or other rights for which the record date is prior to such
time, except as expressly provided in the Plan.
</FONT>
<P><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;15.3 CONDITIONS UPON ISSUANCE OF COMMON SHARES.
</FONT>
<P align="left"><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;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,
</FONT>

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<P><FONT size="2">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.
</FONT>
<P align="left"><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;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:
</FONT>

<P align="left"><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(i)&nbsp;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
&#147;Securities Laws&#148;), and that the Company is issuing the Common Shares to it in
reliance on such representations.
</FONT>

<P align="left"><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(ii)&nbsp;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.
</FONT>

<P align="left"><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(iii)&nbsp;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.
</FONT>

<P align="left"><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(iv)&nbsp;DISPOSITION OF SHARES. Participant shall make no disposition of the
Common Shares, unless and until:
</FONT>

<P align="center"><FONT size="2">A-23
</FONT>

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<P align="left"><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(1)&nbsp;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;
</FONT>

<P align="left"><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(2)&nbsp;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
</FONT>

<P align="left"><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(3)&nbsp;Participant shall have provided an opinion to the Company&#146;s counsel
(at its expense), in form and substance reasonably satisfactory to the Company,
that (i)&nbsp;the proposed disposition does not require registration of the Common
Shares under the applicable Securities Laws or (ii)&nbsp;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.
</FONT>

<P align="left"><FONT size="2"><B>ARTICLE 16. WITHHOLDING TAXES.</B></FONT>

<P><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;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.
</FONT>
<P><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;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.
</FONT>
<P align="left"><FONT size="2"><B>ARTICLE 17. FUTURE OF THE PLAN.</B></FONT>

<P><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;17.1 TERM OF THE PLAN. The Plan, as set forth herein, shall become
effective as of December&nbsp;1, 2000. The Plan shall remain in effect until it is
terminated under Section&nbsp;17.2, except that no ISOs shall be granted on or after
the 10th anniversary of the later of (a)&nbsp;the date when the Board adopted the
Plan or (b)&nbsp;the date when the Board adopted the most recent increase in the
number of Common Shares available under Article&nbsp;3 which was approved by the
Company&#146;s stockholders.
</FONT>
<P><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;17.2 AMENDMENT OR TERMINATION. The Board may at any time amend, alter,
suspend or terminate the Plan for any reason.
</FONT>
<P align="center"><FONT size="2">A-24
</FONT>

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<P><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;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.
</FONT>
<P><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;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.
</FONT>
<P align="left"><FONT size="2"><B>ARTICLE 18. LIMITATION ON PARACHUTE PAYMENTS.</B></FONT>

<P><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;18.1 SCOPE OF LIMITATION. This Article&nbsp;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&nbsp;18. If this Article&nbsp;18 applies to an Award, it shall supersede any
contrary provision of the Plan or of any Award granted under the Plan.
</FONT>
<P><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;18.2 BASIC RULE. In the event that the independent auditors most recently
selected by the Board (the &#147;Auditors&#148;) determine that any payment or transfer
by the Company under the Plan to or for the benefit of a Participant (a
&#147;Payment&#148;) would be nondeductible by the Company for federal income tax
purposes because of the provisions concerning &#147;excess parachute payments&#148; in
Section&nbsp;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&nbsp;18, the &#147;Reduced Amount&#148; 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&nbsp;280G of the Code.
</FONT>
<P><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;18.3 REDUCTION OF PAYMENTS. If the Auditors determine that any Payment
would be nondeductible by the Company because of Section&nbsp;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
</FONT>
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</FONT>

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<P><FONT size="2"> 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&nbsp;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 notify the
Participant promptly of such election. For purposes of this Article&nbsp;18,
present value shall be determined in accordance with Section&nbsp;280G(d)(4) of the
Code. All determinations made by the Auditors under this Article&nbsp;18 shall be
binding upon the Company and the Participant and shall be made within 60&nbsp;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.
</FONT>
<P><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;18.4 OVERPAYMENTS AND UNDERPAYMENTS. As a result of uncertainty in the
application of Section&nbsp;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 &#147;Overpayment&#148;) or that
additional Payments that will not have been made by the Company could have been
made (an &#147;Underpayment&#148;), 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&nbsp;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&nbsp;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&nbsp;7872(f)(2) of the Code.
</FONT>
<P><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;18.5 RELATED CORPORATIONS. For purposes of this Article&nbsp;18, the term
&#147;Company&#148; shall include affiliated corporations to the extent determined by the
Auditors in accordance with Section&nbsp;280G(d)(5) of the Code.
</FONT>
<P align="left"><FONT size="2"><B>ARTICLE 19. INDEMNIFICATION.</B></FONT>

<P><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;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
</FONT>
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</FONT>

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<P><FONT size="2"> 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&#146; 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 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.
</FONT>
<P><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;It is the Company&#146;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.
</FONT>
<P align="left"><FONT size="2"><B>ARTICLE 20. PROVISION OF INFORMATION.</B></FONT>

<P><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Each Participant will receive a copy of the Plan. At least annually, a
copy of the Company&#146;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&#146;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.
</FONT>
<P align="left"><FONT size="2"><B>ARTICLE 21. ADMINISTRATION.</B></FONT>

<P><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;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)&nbsp;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
</FONT>
<P align="center"><FONT size="2">A-27
</FONT>

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<P><FONT size="2"> time and revest in
the Board the administration of the Plan. In addition, the composition of the
Committee shall satisfy:
</FONT>
<P align="left"><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;a. Such requirements as the Securities and Exchange Commission may
establish for administrators acting under plans intended to qualify for
exemption under Rule&nbsp;16b-3 (or its successor) under the Exchange Act; and
</FONT>

<P align="left"><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;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.
</FONT>

<P><FONT size="2">In the absence of a Committee, all references in this Plan to the Committee
shall mean and refer to the Board.
</FONT>
<P><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;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:
</FONT>
<P align="left"><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;a. to determine the Fair Market Value of the Common Stock, in accordance
with Section&nbsp;2 of the Plan;
</FONT>

<P align="left"><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;b. to select the Employees, Consultants and Outside Directors to whom
Awards may be granted hereunder;
</FONT>

<P align="left"><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;c. to determine whether and to what extent Awards or any combination
thereof are granted hereunder;
</FONT>

<P align="left"><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;d. to determine the number of Common Shares to be covered by each Award
granted hereunder;
</FONT>

<P align="left"><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;e. to approve forms of agreement for use under the Plan;
</FONT>

<P align="left"><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;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;
</FONT>

<P align="left"><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;g. to construe and interpret the terms of the Plan;
</FONT>

<P align="center"><FONT size="2">A-28
</FONT>

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<P align="left"><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;h. to prescribe, amend and rescind rules and regulations relating to the
Plan;
</FONT>

<P align="left"><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;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;
</FONT>

<P align="left"><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;j. to reduce the exercise price of any Award;
</FONT>

<P align="left"><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;k. to modify or amend each Award (subject to Section&nbsp;17 of the Plan);
</FONT>

<P align="left"><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;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;
</FONT>

<P align="left"><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;m. to determine the terms and restrictions applicable to Awards and any
Restricted Stock; and
</FONT>

<P align="left"><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;n. to make all other determinations deemed necessary or advisable for
administering the Plan.
</FONT>

<P><FONT size="2">The Board&#146;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.
</FONT>
<P><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;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&nbsp;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&nbsp;21.3, any reference in the Plan
to the Committee shall include such secondary committee.
</FONT>
<P align="left"><FONT size="2"><B>ARTICLE 22. EXECUTION.</B></FONT>

<P><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;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.
</FONT>
<P>
<TABLE width="100%" border="0" cellpadding="0" cellspacing="0">
<TR valign="top">
        <TD width="48%"><FONT size="2">&nbsp;</FONT></TD>
        <TD width="4%"><FONT size="2">&nbsp;</FONT></TD>
        <TD width="48%"><FONT size="2">&nbsp;</FONT></TD>
</TR>
<TR valign="top">
                  <TD><FONT size="2">&nbsp;</FONT></TD>
        <TD COLSPAN="2"><FONT size="2">Advanced Biotherapy, Inc.</FONT></TD>
</TR>
<TR valign="top">
        <TD><FONT size="2">&nbsp;</FONT></TD>
        <TD><FONT size="2">&nbsp;</FONT></TD>
        <TD><FONT size="2">&nbsp;</FONT></TD>
</TR>
<TR valign="top">
        <TD><FONT size="2">&nbsp;</FONT></TD>
        <TD><FONT size="2">&nbsp;</FONT></TD>
        <TD><FONT size="2">&nbsp;</FONT></TD>
</TR>
<TR valign="top">
        <TD><FONT size="2">&nbsp;</FONT></TD>
        <TD><FONT size="2">By:</FONT></TD>
        <TD><FONT size="2">/s/ Authorized Officer</FONT></TD>
</TR>
<TR valign="top">
        <TD><FONT size="2">&nbsp;</FONT></TD>
        <TD><FONT size="2">&nbsp;</FONT></TD>
        <TD><FONT size="2"><hr size="1"></FONT></TD>
</TR>
<TR valign="top">
        <TD><FONT size="2">&nbsp;</FONT></TD>
        <TD><FONT size="2">&nbsp;</FONT></TD>
        <TD><FONT size="2">&nbsp;</FONT></TD>
</TR>
</TABLE>
<P align="center"><FONT size="2">A-29
</FONT>

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<P align="center"><FONT size="2"><B>ADVANCED BIOTHERAPY, INC.<BR>
2000 OMNIBUS EQUITY INCENTIVE PLAN</B></FONT>

<P align="center"><FONT size="2"><B>NOTICE OF GRANT</B></FONT>

<P><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Unless otherwise defined herein, the terms defined in the 2000 Omnibus
Equity Incentive Plan (the &#147;Plan&#148;) shall have the same defined meanings in this
Notice of Grant.
</FONT>
<P>
<TABLE width="100%" border="0" cellpadding="0" cellspacing="0">
<TR valign="top">
        <TD width="50%"><FONT size="2">&nbsp;</FONT></TD>
        <TD width="50%"><FONT size="2">Name<BR>
Address</FONT></TD>
</TR>
</TABLE>
<P><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;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:
</FONT>
<CENTER>
<TABLE cellspacing="0" border="0" cellpadding="0" width="75%">
<TR valign="bottom">
        <TD width="53%">&nbsp;</TD>
        <TD width="5%">&nbsp;</TD>
        <TD width="42%">&nbsp;</TD>
</TR>
<TR valign="bottom">
        <TD valign="top"><FONT size="2">Grant Number</FONT></TD>
        <TD><FONT size="2">&nbsp;</FONT></TD>
        <TD align="LEFT" valign="top"><FONT size="2">
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;XXX</FONT></TD>
</TR>
<TR><TD><TR><TD><TR><TD><TR><TD>
<TR><TD><TR><TD><TR><TD><TR><TD>
<TR><TD><TR><TD><TR><TD><TR><TD>

<TR valign="bottom">
        <TD valign="top"><FONT size="2">Date of Grant</FONT></TD>
        <TD><FONT size="2">&nbsp;</FONT></TD>
        <TD align="left" valign="top"><FONT size="2">
_____________ 2000</FONT></TD>
</TR>
<TR><TD><TR><TD><TR><TD><TR><TD>
<TR><TD><TR><TD><TR><TD><TR><TD>
<TR><TD><TR><TD><TR><TD><TR><TD>

<TR valign="bottom">
        <TD valign="top"><FONT size="2">Vesting Commencement Date</FONT></TD>
        <TD><FONT size="2">&nbsp;</FONT></TD>
        <TD align="left" valign="top"><FONT size="2">
_______________ 20xx</FONT></TD>
</TR>
<TR><TD><TR><TD><TR><TD><TR><TD>
<TR><TD><TR><TD><TR><TD><TR><TD>
<TR><TD><TR><TD><TR><TD><TR><TD>

<TR valign="bottom">
        <TD valign="top"><FONT size="2">Exercise Price per Share</FONT></TD>
        <TD><FONT size="2">&nbsp;</FONT></TD>
        <TD align="left" valign="top"><FONT size="2">
$xx.xx</FONT></TD>
</TR>
<TR><TD><TR><TD><TR><TD><TR><TD>
<TR><TD><TR><TD><TR><TD><TR><TD>
<TR><TD><TR><TD><TR><TD><TR><TD>

<TR valign="bottom">
        <TD valign="top"><FONT size="2">Total Number of Shares Granted</FONT></TD>
        <TD><FONT size="2">&nbsp;</FONT></TD>
        <TD align="left" valign="top"><FONT size="2">
xxx</FONT></TD>
</TR>
<TR><TD><TR><TD><TR><TD><TR><TD>
<TR><TD><TR><TD><TR><TD><TR><TD>
<TR><TD><TR><TD><TR><TD><TR><TD>

<TR valign="bottom">
        <TD valign="top"><FONT size="2">Total Exercise Price</FONT></TD>
        <TD><FONT size="2">&nbsp;</FONT></TD>
        <TD align="left" valign="top"><FONT size="2">
$xxxxxxxxx</FONT></TD>
</TR>
<TR><TD><TR><TD><TR><TD><TR><TD>
<TR><TD><TR><TD><TR><TD><TR><TD>
<TR><TD><TR><TD><TR><TD><TR><TD>

<TR valign="bottom">
        <TD valign="top"><FONT size="2">Type of Option:</FONT></TD>
        <TD><FONT size="2">&nbsp;</FONT></TD>
        <TD align="left" valign="top"><FONT size="2">
______ Incentive Stock Option</FONT></TD>
</TR>
<TR><TD><TR><TD><TR><TD><TR><TD>
<TR><TD><TR><TD><TR><TD><TR><TD>
<TR><TD><TR><TD><TR><TD><TR><TD>

<TR valign="bottom">
        <TD valign="top"><FONT size="2">&nbsp;</FONT></TD>
        <TD><FONT size="2">&nbsp;</FONT></TD>
        <TD align="left" valign="top"><FONT size="2">
______ Nonstatutory Stock Option</FONT></TD>
</TR>

<TR><TD><TR><TD><TR><TD><TR><TD>
<TR><TD><TR><TD><TR><TD><TR><TD>
<TR><TD><TR><TD><TR><TD><TR><TD>

<TR valign="bottom">
        <TD valign="top"><FONT size="2">Term/Expiration Date:</FONT></TD>
        <TD><FONT size="2">&nbsp;</FONT></TD>
        <TD align="left" valign="top"><FONT size="2">
__________, 20xx</FONT></TD>
</TR>
</TABLE>
</CENTER>
<P><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<U>Vesting Schedule:</U>
</FONT>
<P><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;This Option may be exercised, in whole or in part, in accordance with the
following schedule:
</FONT>
<CENTER>
<TABLE cellspacing="0" border="0" cellpadding="0" width="75%">
<TR valign="bottom">
        <TD width="48%">&nbsp;</TD>
        <TD width="4%">&nbsp;</TD>
        <TD width="48%">&nbsp;</TD>
</TR>
<TR valign="bottom">
        <TD nowrap align="center"><FONT size="1"><U>Number of Shares (Installment)</U></FONT></TD>
        <TD><FONT size="1">&nbsp;</FONT></TD>
        <TD nowrap align="center"><FONT size="1"><U>Date of Earliest Exercise (Vesting)</U></FONT></TD>
</TR>
</TABLE>
</CENTER>


<P align="center"><FONT size="2">A-30
</FONT>

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<P align="left"><FONT size="2"><U>Termination Period:</U></FONT>

<P><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;This Option may be exercised for six (6)&nbsp;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)&nbsp;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 &#147;for cause&#148; (as defined in Section&nbsp;6 of the Option
Agreement), this Option shall terminate automatically on the termination date.
</FONT>
<P align="left"><FONT size="2"><U>Additional Terms/Acknowledgments:</U></FONT>

<P><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;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.
</FONT>
<P>
<TABLE width="100%" border="0" cellpadding="0" cellspacing="0">
<TR valign="top">
        <TD width="4%"><FONT size="2">&nbsp;</FONT></TD>
        <TD width="20%"><FONT size="2">&nbsp;</FONT></TD>
        <TD width="2%"><FONT size="2">&nbsp;</FONT></TD>
        <TD width="4%"><FONT size="2">&nbsp;</FONT></TD>
        <TD width="20%"><FONT size="2">&nbsp;</FONT></TD>
</TR>
<TR valign="top">
        <TD COLSPAN="2"><FONT size="2">ADVANCED BIOTHERAPY, INC.,</FONT></TD>
        <TD><FONT size="2">&nbsp;</FONT></TD>
        <TD><FONT size="2">OPTIONEE:</FONT></TD>
        <TD><FONT size="2">&nbsp;</FONT></TD>
</TR>
<TR valign="top">
        <TD COLSPAN="2"><FONT size="2">a Delaware corporation</FONT></TD>
        <TD><FONT size="2">&nbsp;</FONT></TD>
        <TD><FONT size="2">&nbsp;</FONT></TD>
        <TD><FONT size="2">&nbsp;</FONT></TD>
</TR>
<TR valign="top">
        <TD><FONT size="2">&nbsp;</FONT></TD>
        <TD><FONT size="2">&nbsp;</FONT></TD>
        <TD><FONT size="2">&nbsp;</FONT></TD>
        <TD><FONT size="2">&nbsp;</FONT></TD>
        <TD><FONT size="2">&nbsp;</FONT></TD>
</TR>
<TR valign="top">
        <TD><FONT size="2">&nbsp;</FONT></TD>
        <TD><FONT size="2">&nbsp;</FONT></TD>
        <TD><FONT size="2">&nbsp;</FONT></TD>
        <TD><FONT size="2">&nbsp;</FONT></TD>
        <TD><FONT size="2">&nbsp;</FONT></TD>
</TR>
<TR valign="top">
        <TD><FONT size="2">By:</FONT></TD>
        <TD><FONT size="2">&nbsp;</FONT></TD>
        <TD><FONT size="2">&nbsp;</FONT></TD>
        <TD><FONT size="2">&nbsp;</FONT></TD>
        <TD><FONT size="2">&nbsp;</FONT></TD>
</TR>
<TR valign="top">
        <TD><FONT size="2">&nbsp;</FONT></TD>
        <TD><FONT size="2"><HR SIZE="1"></FONT></TD>
        <TD><FONT size="2">&nbsp;</FONT></TD>
        <TD COLSPAN="2"><FONT size="2"><HR SIZE="1"></FONT></TD>
</TR>
<TR valign="top">
        <TD><FONT size="2">&nbsp;</FONT></TD>
        <TD><FONT size="2">&nbsp;</FONT></TD>
        <TD><FONT size="2">&nbsp;</FONT></TD>
        <TD><FONT size="2">&nbsp;</FONT></TD>
        <TD><FONT size="2">&nbsp;</FONT></TD>
</TR>
<TR valign="top">
        <TD><FONT size="2">Title:</FONT></TD>
        <TD><FONT size="2">&nbsp;</FONT></TD>
        <TD><FONT size="2">&nbsp;</FONT></TD>
        <TD NOWRAP><FONT size="2">Printed Name:</FONT></TD>
        <TD><FONT size="2">&nbsp;</FONT></TD>
</TR>
<TR valign="top">
        <TD><FONT size="2">&nbsp;</FONT></TD>
        <TD><FONT size="2"><HR SIZE="1"></FONT></TD>
        <TD><FONT size="2">&nbsp;</FONT></TD>
        <TD><FONT size="2">&nbsp;</FONT></TD>
        <TD><FONT size="2"><HR SIZE="1"></FONT></TD>
</TR>
<TR valign="top">
        <TD><FONT size="2">&nbsp;</FONT></TD>
        <TD><FONT size="2">&nbsp;</FONT></TD>
        <TD><FONT size="2">&nbsp;</FONT></TD>
        <TD><FONT size="2">&nbsp;</FONT></TD>
        <TD><FONT size="2">&nbsp;</FONT></TD>
</TR>
<TR valign="top">
        <TD><FONT size="2">Date:</FONT></TD>
        <TD><FONT size="2">&nbsp;</FONT></TD>
        <TD><FONT size="2">&nbsp;</FONT></TD>
        <TD><FONT size="2">Date Signed:</FONT></TD>
        <TD><FONT size="2">&nbsp;</FONT></TD>
</TR>
<TR valign="top">
        <TD><FONT size="2">&nbsp;</FONT></TD>
        <TD><FONT size="2"><HR SIZE="1"></FONT></TD>
        <TD><FONT size="2">&nbsp;</FONT></TD>
        <TD><FONT size="2">&nbsp;</FONT></TD>
        <TD><FONT size="2"><HR SIZE="1"></FONT></TD>
</TR>
</TABLE>
<P align="center"><FONT size="2">A-31
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<P align="center"><FONT size="2"><B>ADVANCED BIOTHERAPY, INC.<BR>
2000 OMNIBUS EQUITY INCENTIVE PLAN</B></FONT>

<P align="center"><FONT size="2"><B>OPTION AGREEMENT</B></FONT>

<P><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;1.&nbsp;<U>Grant of Option.</U> Advanced Biotherapy, Inc. (the &#147;Company&#148;), hereby
grants to the Optionee (the &#147;Optionee&#148;) named in the Notice of Grant, an option
(the &#147;Option&#148;) to purchase the total number of shares of Common Stock (the
&#147;Shares&#148;) set forth in the Notice of Grant, at the exercise price per share set
forth in the Notice of Grant (the &#147;Exercise Price&#148;) subject to the terms,
definitions and provisions of the 2000 Omnibus Equity Incentive Plan (Common
Stock) (the &#147;Plan&#148;) adopted by the Company, which is incorporated herein by
reference. Unless otherwise defined herein, the terms defined in the Plan
shall have the same defined meanings in this Option Agreement.
</FONT>
<P align="left"><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;If designated in the Notice of Grant as an Incentive Stock Option (&#147;ISO&#148;),
this Option is intended to qualify as an Incentive Stock Option as defined in
Section&nbsp;422 of the Code. However, if this Option is intended to be an
Incentive Stock Option, to the extent that it exceeds the $100,000 rule of Code
Section&nbsp;422(d) it shall be treated as a Nonstatutory Stock Option (&#147;NSO&#148;).
</FONT>

<P><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;2.&nbsp;<U>Exercise of Option.</U> This Option shall be exercisable during its term
in accordance with the Vesting Schedule set out in the Notice of Grant and with
the provisions of Section&nbsp;9 of the Plan as follows:
</FONT>
<P align="left"><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(i)&nbsp;<U>Right to Exercise.</U>
</FONT>

<P align="left"><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(A)&nbsp;This Option may not be exercised for a fraction of a Share.
</FONT>

<P align="left"><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(B)&nbsp;In the event Optionee ceases to be a Service Provider, the
exercisability of the Option is governed by Sections&nbsp;6, 7 and 8 below, subject
to the limitation contained in subsection 2(i)(c).
</FONT>

<P align="left"><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(C)&nbsp;In no event may this Option be exercised after the date of expiration
of the term of this Option as set forth in the Notice of Grant.
</FONT>

<P align="left"><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(ii)&nbsp;<U>Method of Exercise.</U> This Option shall be exercisable by written
Exercise Notice (in the form attached as <U>Exhibit&nbsp;A,</U> the terms and provisions of
which are incorporated herein by reference) which shall state the election to
exercise the Option, the number of Shares in respect of which the Option is
being exercised, and such other representations and agreements as to the
holder&#146;s investment intent with respect to such shares of Common Stock as may
be required by the Company pursuant to the provisions of the Plan. Such
written notice shall be signed by the Optionee and shall be delivered in person
or by certified mail to the Secretary of the Company. The written notice shall
be accompanied by payment of the Exercise Price. This Option shall be deemed
to be
</FONT>

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<P><FONT size="2">exercised upon receipt by the Company of such written notice accompanied
by the Exercise Price.
</FONT>
<P align="left"><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;No Shares will be issued pursuant to the exercise of an Option unless such
issuance and such exercise shall comply with all relevant provisions of law and
the requirements of any stock exchange or national market system upon which the
Common Stock is then listed. Assuming such compliance, for income tax purposes
the Shares shall be considered transferred to the Optionee on the date on which
the Option is exercised with respect to such Shares.
</FONT>

<P><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;3.&nbsp;<U>Optionee&#146;s Representations.</U> In the event the Shares purchasable
pursuant to the exercise of this Option have not been registered under the
Securities Act, at the time this Option is exercised, Optionee shall, if
required by the Company, concurrently with the exercise of all or any portion
of this Option, deliver to the Company his or her Investment Representation
Statement in the form attached hereto as <U>Exhibit&nbsp;B.</U>
</FONT>
<P><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;4.&nbsp;<U>Method of Payment.</U> Payment of the Exercise Price shall be by any of
the following, or a combination thereof, at the election of the Optionee:
</FONT>
<P align="left"><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(i)&nbsp;cash; or
</FONT>

<P align="left"><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(ii)&nbsp;check; or
</FONT>

<P align="left"><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(iii)&nbsp;surrender of other shares of Common Stock (or other equity
securities) of the Company which (A)&nbsp;in the case of Shares acquired pursuant to
the exercise of a Company option, have been owned by the Optionee for more than
six (6)&nbsp;months on the date of surrender, and (B)&nbsp;have a Fair Market Value on
the date of surrender equal to the Exercise Price of the Shares as to which the
Option is being exercised; or
</FONT>

<P align="left"><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(iv)&nbsp;to the extent authorized by the Company, delivery of a properly
executed exercise notice together with such other documentation as the
Company&#146;s Board of Directors and the broker, if applicable, shall require to
effect an exercise of the Option and delivery to the Company of the sale or
loan proceeds required to pay the Exercise Price; or
</FONT>

<P align="left"><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(v)&nbsp;to the extent authorized by the Plan, delivery of a properly executed
exercise notice together with such other documentation as the Company&#146;s Board
of Directors shall require to effect a &#147;cashless exercise&#148; of the Option.
</FONT>

<P><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;5.&nbsp;<U>Restrictions on Exercise.</U> This Option may not be exercised if the
issuance of such Shares upon such exercise or the method of payment of
consideration for such shares would constitute a violation of any applicable
federal or state securities or other law or regulation, including any rule
under Part 207 of Title 12 of the Code of Federal
</FONT>
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<P><FONT size="2"> Regulations as promulgated by
the Federal Reserve Board. As a condition to the exercise of this Option, the
Company may require Optionee to make any representation and warranty to the
Company as may be required by any applicable law or regulation.
</FONT>
<P><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;6.&nbsp;<U>Termination of Relationship.</U> In the event an Optionee ceases to be a
Service Provider, Optionee may, to the extent otherwise so entitled at the date
of such termination (the &#147;Termination Date&#148;), exercise this Option during the
Termination Period set out in the Notice of Grant. To the extent that Optionee
was not entitled to exercise this Option at the date of such termination, or if
Optionee does not exercise this Option within the time specified herein, the
Option shall terminate. Notwithstanding the foregoing, if Optionee is
terminated &#147;for cause&#148; by the Company, any Subsidiary or any Parent, the Option
shall automatically terminate on the Termination Date. For purposes of this
Option Agreement, &#147;for cause&#148; shall mean:
</FONT>
<P align="left"><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(i)&nbsp;with respect to employees or directors of the Company:
</FONT>

<P align="left"><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(A)&nbsp;the failure or refusal by such person to perform his or her duties to
the Company; or
</FONT>

<P align="left"><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(B)&nbsp;such person&#146;s willful disobedience of any orders or directives of the
Board or any officers thereof acting under the authority thereof or such
person&#146;s deliberate interference with the compliance by other employees of the
Company with any such orders or directives; or
</FONT>

<P align="left"><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(C)&nbsp;the failure or refusal of such person to abide by or comply with the
written policies, standard procedures or regulations of the Company; or
</FONT>

<P align="left"><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(D)&nbsp;any willful or continued act or course of conduct by such person which
the Board in good faith determines might reasonably be expected to have a
material detrimental effect on the Company or the business, operations, affairs
or financial position thereof; or
</FONT>

<P align="left"><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(E)&nbsp;the committing by such person of any fraud, theft, embezzlement or
other dishonest act against the Company; or
</FONT>

<P align="left"><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(F)&nbsp;the determination by the Board, in good faith and in the exercise of
reasonable discretion, that such person is not competent to perform his or her
duties of employment; and
</FONT>

<P align="left"><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(iii)&nbsp;with respect to consultants, any material breach of their consulting
agreement with the Company, or the expiration or termination of their
consulting agreement, or when they are no longer providing services to the
Company for which they are being compensated.
</FONT>

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<P><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;7.&nbsp;<U>Disability of Optionee.</U> Notwithstanding the provisions of Section&nbsp;6
above, in the event an Optionee ceases to be a Service Provider as a result of
his or her Disability, Optionee may, but only within six (6)&nbsp;months from the
date of such termination (and in no event later than the expiration date of the
term of such Option as set forth in the Notice of Grant) exercise the Option to
the extent otherwise entitled to exercise it at the date of such termination.
To the extent that Optionee is not entitled to
exercise the Option at the date of termination, or if Optionee does not
exercise such Option to the extent so entitled within the time specified
herein, the Option shall terminate, and the Shares covered by such Option shall
revert to the Plan.
</FONT>
<P><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;8.&nbsp;<U>Death of Optionee.</U> In the event an Optionee ceases to be a Service
Provider as a result of the death of Optionee, the Option may be exercised at
any time within six (6)&nbsp;months following the date of death (but in no event
later than the date of expiration of the term of this Option as set forth in
Section&nbsp;10 below), by Optionee&#146;s estate or by a person who acquired the right
to exercise the Option by bequest or inheritance, but only to the extent the
Optionee could exercise the Option at the date of death. If such person does
not exercise such Option to the extent so entitled within the time specified
herein, the Option shall terminate, and the Shares covered by such Option shall
revert to the Plan.
</FONT>
<P><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;9.&nbsp;<U>Non-Transferability of Option.</U> This Option may not be transferred in
any manner otherwise than by will or by the laws of descent or distribution and
may be exercised during the lifetime of Optionee only by Optionee. The terms
of this Option shall be binding upon the executors, administrators, heirs,
successors and assigns of the Optionee.
</FONT>
<P><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;10.&nbsp;<U>Term of Option.</U> This Option may be exercised only within the term set
out in the Notice of Grant, and may be exercised during such term only in
accordance with the Plan and the terms of this Option. The limitations set out
in the Plan regarding Options designated as Incentive Stock Options and Options
granted to more than ten percent (10%) shareholders shall apply to this Option.
</FONT>
<P><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;11.&nbsp;<U>Tax Consequences.</U> Set forth below is a brief summary as of the date
of this Option of some of the federal tax consequences of exercise of this
Option and disposition of the Shares. THIS SUMMARY IS NECESSARILY INCOMPLETE,
AND THE TAX LAWS AND REGULATIONS ARE SUBJECT TO CHANGE. OPTIONEE SHOULD
CONSULT A TAX ADVISER BEFORE EXERCISING THIS OPTION OR DISPOSING OF THE SHARES.
</FONT>
<P align="left"><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(i)&nbsp;<U>Exercise of an ISO.</U> If this Option qualifies as an ISO, there will be
no regular federal income tax liability upon the exercise of the Option,
although the excess, if any, of the Fair Market Value of the Shares on the date
of exercise over the Exercise Price will be treated as an adjustment to the
alternative minimum tax for
</FONT>

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<P><FONT size="2">federal tax purposes and may subject the Optionee
to the alternative minimum tax in the year of exercise.
</FONT>
<P align="left"><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(ii)&nbsp;<U>Exercise of an NSO.</U> There may be a regular federal income tax
liability upon the exercise of an NSO. The Optionee will be treated as having
received compensation income (taxable at ordinary income tax rates) equal to
the excess, if any, of the Fair Market Value of the Shares on the date of
exercise over the Exercise Price. If Optionee is an Employee, the Company will
be required to withhold from Optionee&#146;s
compensation or collect from Optionee and pay to the applicable taxing
authorities an amount equal to a percentage of this compensation income at the
time of exercise.
</FONT>

<P align="left"><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(iii)&nbsp;<U>Disposition of Shares.</U> In the case of an NSO, if Shares are held
for at least one year, any gain realized on disposition of the Shares will be
treated as long-term capital gain for federal income tax purposes. In the case
of an ISO, if Shares transferred pursuant to the Option are held for at least
one year after exercise and are disposed of at least two years after the Date
of Grant, any gain realized on disposition of the Shares will also be treated
as long-term capital gain for federal income tax purposes. If Shares purchased
under an ISO are disposed of within such one-year period or within two years
after the Date of Grant, any gain realized on such disposition will be treated
as compensation income (taxable at ordinary income rates) to the extent of the
difference between the Exercise Price and the lesser of (1)&nbsp;the Fair Market
Value of the Shares on the date of exercise, or (2)&nbsp;the sale price of the
Shares.
</FONT>

<P align="left"><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(iv)&nbsp;<U>Notice of Disqualifying Disposition of ISO Shares.</U> If the Option
granted to Optionee herein is an ISO, and if Optionee sells or otherwise
disposes of any of the Shares acquired pursuant to the ISO on or before the
later of (1)&nbsp;the date two years after the Date of Grant, or (2)&nbsp;the date one
year after the date of exercise, the Optionee shall immediately notify the
Company in writing of such disposition. Optionee agrees that Optionee may be
subject to income tax withholding by the Company on the compensation income
recognized by the Optionee.
</FONT>

<P><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;12.&nbsp;<U>Company&#146;s Repurchase Right.</U>
</FONT>
<P align="left"><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(i)&nbsp;<U>Grant of Repurchase Right.</U> The Company is hereby granted the right
(the &#147;Repurchase Right&#148;), exercisable at any time (a)&nbsp;during the ninety (90)
day period following the Termination Date, or (b)&nbsp;during the ninety (90)&nbsp;day
period following an exercise of the Option that occurs after the Termination
Date, to repurchase all or any portion of the Shares.
</FONT>

<P align="left"><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(ii)&nbsp;<U>Exercise of the Repurchase Right.</U> The Repurchase Right shall be
exercisable by written notice delivered to each Optionee of the Shares prior to
the expiration of the applicable ninety (90)&nbsp;day period specified above. The
notice shall indicate the number of Shares to be repurchased and the date on
which the repurchase is to be effected, such date to be not more than thirty
(30)&nbsp;days after the date of notice. On the date on which the repurchase is to
be effected, the Company and/or its assigns
</FONT>

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<P><FONT size="2">shall pay to the Optionee in cash
or cash equivalents (including the cancellation of any purchase-money
indebtedness) an amount equal to the <I>greater </I>of the Fair Market Value of the
Shares on the Termination Date, if any, or the Exercise Price previously paid
for the Shares which are to be repurchased from the Optionee. Upon such
payment to the Optionee, or into escrow for the benefit of the Optionee, the
Company and/or its assigns shall become the legal and beneficial owner of the
Shares being repurchased and all rights and interest thereon or related
thereto, and the Company shall have the right to transfer to its own name or
its assigns the number of Shares being repurchased, without further action by
the Optionee.
</FONT>
<P align="left"><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(iii)&nbsp;<U>Assignment.</U> Whenever the Company shall have the right to purchase
Shares under this Repurchase Right, the Company may designate and assign one or
more employees, officers, directors or shareholders of the Company or other
persons or organizations, to exercise all or a part of the Company&#146;s Repurchase
Right.
</FONT>

<P align="left"><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(iv)&nbsp;<U>Termination of the Repurchase Right.</U> The Repurchase Right shall
terminate with respect to any Shares for which it is not timely exercised. In
addition, the Repurchase Right shall terminate, and cease to be exercisable,
with respect to all Shares upon the <I>earliest </I>to occur of: (A)&nbsp;the first date on
which shares of Common Stock are held of record by more than five hundred
persons; (B)&nbsp;a determination by the Board of Directors of the Company that a
public market exists for the outstanding shares of Common Stock; or (C)&nbsp;the
closing of an underwritten public offering of the Company&#146;s Common Stock
pursuant to an effective registration statement files with the Securities and
Exchange Commission under the Securities Act, with respect to which there are
gross proceeds to the Company of at least $5,000,000.
</FONT>

<P align="left"><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(v)&nbsp;<U>Additional Shares or Substituted Securities.</U> In the event of any
stock split, stock dividend, recapitalization, combination of shares, exchange
of shares or other change affecting the outstanding Common Stock as a class
effected without the Company&#146;s receipt of consideration, any new, substituted
or additional securities or other property (including money paid other than as
a regular cash dividend) which is by reason of any such transaction distributed
with respect to the Shares shall be immediately subject to the Repurchase
Right, but only to the extent the Shares are at the time covered by such right.
Appropriate adjustments to reflect the distribution of such securities or
property shall be made to the price per share to be paid upon the exercise of
the Repurchase Right in order to reflect the effect of any such transaction
upon the Company&#146;s capital structure.
</FONT>

<P align="left"><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(vi)&nbsp;<U>Certain Corporate Transactions.</U> Immediately prior to the
consummation of a transaction of the type described in Article&nbsp;11 of the Plan,
the Repurchase Right shall automatically lapse in its entirety, except to the
extent the Repurchase Right is to be assigned to a successor corporation (or
its Parent company) in connection with such transaction, the right shall apply
to the new capital stock or other property (including cash paid other than as a
regular cash dividend) received in
</FONT>

<P align="center"><FONT size="2">A-37
</FONT>

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<P align="left"><FONT size="2">exchange for the Shares in consummation of
such transaction, but only to the extent the Shares are at the time covered by
such right. Appropriate adjustments shall be made to the price per share
payable upon exercise of the Repurchase Right to reflect the effect of such
transaction upon the Company&#146;s capital structure.
</FONT>

<P>
<TABLE width="100%" border="0" cellpadding="0" cellspacing="0">
<TR valign="top">
        <TD width="48%"><FONT size="2">&nbsp;</FONT></TD>
        <TD width="4%"><FONT size="2">&nbsp;</FONT></TD>
        <TD width="48%"><FONT size="2">&nbsp;</FONT></TD>
</TR>
<TR valign="top">
        <TD><FONT size="2">&nbsp;</FONT></TD>
        <TD COLSPAN="2"><FONT size="2">ADVANCED BIOTHERAPY, INC.</FONT></TD>
</TR>
<TR valign="top">
        <TD><FONT size="2">&nbsp;</FONT></TD>
        <TD><FONT size="2">&nbsp;</FONT></TD>
        <TD><FONT size="2">&nbsp;</FONT></TD>
</TR>
<TR valign="top">
        <TD><FONT size="2">&nbsp;</FONT></TD>
        <TD><FONT size="2">&nbsp;</FONT></TD>
        <TD><FONT size="2">&nbsp;</FONT></TD>
</TR>
<TR valign="top">
        <TD><FONT size="2">&nbsp;</FONT></TD>
        <TD><FONT size="2">By:</FONT></TD>
        <TD><FONT size="2">&nbsp;</FONT></TD>
</TR>
<TR valign="top">
        <TD><FONT size="2">&nbsp;</FONT></TD>
        <TD><FONT size="2">&nbsp;</FONT></TD>
        <TD><FONT size="2"><HR SIZE="1"></FONT></TD>
</TR>
<TR valign="top">
        <TD><FONT size="2">&nbsp;</FONT></TD>
        <TD><FONT size="2">&nbsp;</FONT></TD>
        <TD><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&#091;name, title&#093;</FONT></TD>
</TR>
</TABLE>
<P><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;OPTIONEE ACKNOWLEDGES AND AGREES THAT THE VESTING OF SHARES PURSUANT TO
THE OPTION HEREOF IS EARNED ONLY BY CONTINUING CONSULTANCY OR EMPLOYMENT AT THE
WILL OF THE COMPANY (NOT THROUGH THE ACT OF BEING HIRED, BEING GRANTED THIS
OPTION OR ACQUIRING SHARES HEREUNDER). OPTIONEE FURTHER ACKNOWLEDGES AND
AGREES THAT NOTHING IN THIS AGREEMENT, NOR IN THE COMPANY&#146;S 2000 OMNIBUS EQUITY
INCENTIVE PLAN WHICH IS INCORPORATED HEREIN BY REFERENCE, SHALL CONFER UPON
OPTIONEE ANY RIGHT WITH RESPECT TO CONTINUATION OF EMPLOYMENT OR CONSULTANCY BY
THE COMPANY, NOR SHALL IT INTERFERE IN ANY WAY WITH OPTIONEE&#146;S RIGHT OR THE
COMPANY&#146;S RIGHT TO TERMINATE OPTIONEE&#146;S EMPLOYMENT OR CONSULTANCY AT ANY TIME,
WITH OR WITHOUT CAUSE.
</FONT>
<P><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Optionee acknowledges receipt of a copy of the Plan and represents that he
is familiar with the terms and provisions thereof, and hereby accepts this
Option subject to all of the terms and provisions thereof. Optionee has
reviewed the Plan and this Option in their entirety, has had an opportunity to
obtain the advice of counsel prior to executing this Option and fully
understands all provisions of the Option. Optionee hereby agrees to accept as
binding, conclusive and final all decisions or interpretations of the Company&#146;s
Board of Directors upon any questions arising under the Plan or this Option.
Optionee further agrees to notify the Company upon any change in the residence
address indicated below.
</FONT>
<P>
<TABLE width="100%" border="0" cellpadding="0" cellspacing="0">
<TR valign="top">
        <TD width="1%"><FONT size="2">&nbsp;</FONT></TD>
        <TD width="20%"><FONT size="2">&nbsp;</FONT></TD>
        <TD width="5%"><FONT size="2">&nbsp;</FONT></TD>
        <TD width="24%"><FONT size="2">&nbsp;</FONT></TD>
</TR>
<TR valign="top">
        <TD><FONT size="2">Dated:</FONT></TD>
        <TD><FONT size="2">&nbsp;</FONT></TD>
        <TD><FONT size="2">&nbsp;</FONT></TD>
        <TD><FONT size="2">&nbsp;</FONT></TD>
</TR>
<TR valign="top">
        <TD><FONT size="2">&nbsp;</FONT></TD>
        <TD><FONT size="2"><HR SIZE="1"></FONT></TD>
        <TD><FONT size="2">&nbsp;</FONT></TD>
        <TD><FONT size="2"><HR SIZE="1"></FONT></TD>
</TR>
<TR valign="top">
        <TD><FONT size="2">&nbsp;</FONT></TD>
        <TD><FONT size="2">&nbsp;</FONT></TD>
        <TD><FONT size="2">&nbsp;</FONT></TD>
        <TD ALIGN="CENTER"><FONT size="2">Optionee (signature)</FONT></TD>
</TR>
<TR valign="top">
        <TD><FONT size="2">&nbsp;</FONT></TD>
        <TD><FONT size="2">&nbsp;</FONT></TD>
        <TD><FONT size="2">&nbsp;</FONT></TD>
        <TD><FONT size="2">&nbsp;</FONT></TD>
</TR>
<TR valign="top">
        <TD><FONT size="2">&nbsp;</FONT></TD>
        <TD><FONT size="2">&nbsp;</FONT></TD>
        <TD><FONT size="2">&nbsp;</FONT></TD>
        <TD><FONT size="2">&nbsp;</FONT></TD>
</TR>
<TR valign="top">
        <TD><FONT size="2">&nbsp;</FONT></TD>
        <TD><FONT size="2">&nbsp;</FONT></TD>
        <TD><FONT size="2">&nbsp;</FONT></TD>
        <TD><FONT size="2"><HR SIZE="1"></FONT></TD>
</TR>
<TR valign="top">
        <TD><FONT size="2">&nbsp;</FONT></TD>
        <TD><FONT size="2">&nbsp;</FONT></TD>
        <TD><FONT size="2">&nbsp;</FONT></TD>
        <TD ALIGN="CENTER"><FONT size="2">Name (print)</FONT></TD>
</TR>
<TR valign="top">
        <TD><FONT size="2">&nbsp;</FONT></TD>
        <TD><FONT size="2">&nbsp;</FONT></TD>
        <TD><FONT size="2">&nbsp;</FONT></TD>
        <TD><FONT size="2">&nbsp;</FONT></TD>
</TR>
<TR valign="top">
        <TD><FONT size="2">&nbsp;</FONT></TD>
        <TD><FONT size="2">&nbsp;</FONT></TD>
        <TD><FONT size="2">&nbsp;</FONT></TD>
        <TD><FONT size="2">&nbsp;</FONT></TD>
</TR>
<TR valign="top">
        <TD><FONT size="2">&nbsp;</FONT></TD>
        <TD><FONT size="2">&nbsp;</FONT></TD>
        <TD><FONT size="2">&nbsp;</FONT></TD>
        <TD><FONT size="2"><HR SIZE="1"></FONT></TD>
</TR>
<TR valign="top">
        <TD><FONT size="2">&nbsp;</FONT></TD>
        <TD><FONT size="2">&nbsp;</FONT></TD>
        <TD><FONT size="2">&nbsp;</FONT></TD>
        <TD ALIGN="CENTER"><FONT size="2">Social Security Number</FONT></TD>
</TR>
</TABLE>
<P align="center"><FONT size="2">A-38
</FONT>

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<P>
<TABLE width="100%" border="0" cellpadding="0" cellspacing="0">
<TR valign="top">
        <TD width="50%"><FONT size="2">&nbsp;</FONT></TD>
        <TD width="50%"><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Residence Address:<BR>
        <BR>
        <HR SIZE="1"><BR>
        <BR>
        <HR SIZE="1"><BR>
        <BR>
        <HR SIZE="1">
        </FONT></TD>
</TR>
</TABLE>
<P align="center"><FONT size="2">A-39
</FONT>

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<P align="center"><FONT size="2">CONSENT OF SPOUSE</FONT>

<P><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;The undersigned spouse of Optionee has read and hereby approves the terms
and conditions of the Plan and this Option Agreement. In consideration of
Advanced Biotherapy, Inc.&#146;s granting his or her spouse the right to purchase
Shares as set forth in the Plan and this Option Agreement, the undersigned
hereby agrees to be irrevocably bound by the terms and conditions of the Plan
and this Option Agreement and further agrees that any community property
interest shall be similarly bound. The undersigned hereby appoints the
undersigned&#146;s spouse as attorney-in-fact for the undersigned with respect to
any amendment or exercise of rights under the Plan or this Option Agreement.
</FONT>
<P>
<TABLE width="100%" border="0" cellpadding="0" cellspacing="0">
<TR valign="top">
        <TD width="50%"><FONT size="2">&nbsp;</FONT></TD>
        <TD width="50%"><FONT size="2"><HR SIZE="1">Spouse of Optionee<BR>
                  <BR><HR SIZE="1">Printed Name<BR>
                  <BR><HR SIZE="1">Date</FONT></TD>
</TR>
</TABLE>
<P align="center"><FONT size="2">A-40
</FONT>

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<P align="center"><FONT size="2"><B><U>EXHIBIT A</U></B><BR>
&nbsp;<BR>
<B>ADVANCED BIOTHERAPY, INC.</B><BR>
&nbsp;<BR>
<B>2000 OMNIBUS EQUITY INCENTIVE PLAN</B><BR>
&nbsp;<BR>
<B>EXERCISE NOTICE</B></FONT>

<P align="left"><FONT size="2">ADVANCED BIOTHERAPY, INC.<BR>
&#091;ADDRESS&#093;</FONT>

<P align="left"><FONT size="2">Attention: Secretary</FONT>

<P><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;1.&nbsp;<U>Exercise of Option</U>. Effective as of today, <U>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;</U>, 20<U>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;</U>, the
undersigned (&#147;<U>Optionee</U>&#148;) hereby elects to exercise Optionee&#146;s option to
purchase <U>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;</U> shares of the Common Stock (the &#147;Shares&#148;) of ADVANCED
BIOTHERAPY, INC. under and pursuant to the 2000 Omnibus Equity Incentive Plan,
as amended (the &#147;Plan&#148;) and the &#091;&nbsp;&nbsp;&nbsp;&#093; Incentive &#091;&nbsp;&nbsp;&nbsp;&#093; Nonstatutory Stock Option
Agreement dated <U>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;</U>, 20<U>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;</U> (the &#147;Stock Option Agreement&#148;).
</FONT>
<P><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;2.&nbsp;<U>Representations of Optionee</U>. Optionee acknowledges that Optionee has
received, read and understood the Plan and the Stock Option Agreement and
agrees to abide by and be bound by their terms and conditions.
</FONT>
<P><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;3.&nbsp;<U>Rights as Shareholder</U>. Until the stock certificate evidencing such
Shares is issued (as evidenced by the appropriate entry on the books of the
Company or of a duly authorized transfer agent of the Company), no right to
vote or receive dividends or any other rights as a shareholder shall exist with
respect to the Optioned Stock, notwithstanding the exercise of the Option. The
Company shall issue (or cause to be issued) such stock certificate 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 stock
certificate is issued, except as may be provided in the Plan.
</FONT>
<P><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Optionee shall enjoy rights as a shareholder until such time as Optionee
disposes of the Shares or the Company and/or its assignee(s) exercises the
Right of First Refusal hereunder. Upon such exercise, Optionee shall have no
further rights as a holder of the Shares so purchased except the right to
receive payment for the Shares so purchased in accordance with the provisions
of this Agreement, and Optionee shall forthwith cause the certificate(s)
evidencing the Shares so purchased to be surrendered to the Company for
transfer or cancellation.
</FONT>

<DIV>&nbsp;</DIV>
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<P><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;4.&nbsp;<U>Company&#146;s Right of First Refusal</U>. Before any Shares held by Optionee
or any transferee (either being sometimes referred to herein as the &#147;Holder&#148;)
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 Shares on the terms and conditions set forth in this Section (the
&#147;Right of First Refusal&#148;).
</FONT>
<P align="left"><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(i)&nbsp;<U>Notice of Proposed Transfer</U>. The Holder of the Shares shall deliver
to the Company a written notice (the &#147;Notice&#148;) stating: (i)&nbsp;the Holder&#146;s bona
fide intention to sell or otherwise transfer such Shares; (ii)&nbsp;the name of each
proposed purchaser or other transferee (the &#147;Proposed Transferee&#148;); (iii)&nbsp;the
number of Shares to be transferred to each Proposed Transferee; and (iv)&nbsp;the
bona fide cash price or other consideration for which the Holder proposes to
transfer the Shares (the &#147;Offered Price&#148;), and the Holder shall offer the
Shares at the Offered Price to the Company or its assignee(s).
</FONT>

<P align="left"><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(ii)&nbsp;<U>Exercise of Right of First Refusal</U>. 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 Shares proposed to be transferred to any one or more of the
Proposed Transferees, at the purchase price determined in accordance with
subsection (c)&nbsp;below.
</FONT>

<P align="left"><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(iii)&nbsp;<U>Purchase Price</U>. The purchase price (the &#147;Purchase Price&#148;) for the
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.
</FONT>

<P align="left"><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(iv)&nbsp;<U>Payment</U>. 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&nbsp;days after receipt of the Notice or in the manner and at the
times set forth in the Notice.
</FONT>

<P align="left"><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(v)&nbsp;<U>Holder&#146;s Right to Transfer</U>. If all of the 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 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&nbsp;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 Shares in the
hands of such Proposed Transferee. If the Shares described in the Notice are
not transferred to the Proposed Transferee within such period, a new Notice
shall be given to

<DIV>&nbsp;</DIV>
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</FONT>

<P><FONT size="2">the Company, and the Company and/or its assignees shall again be offered
the Right of First Refusal before any Shares held by the Holder may be sold or
otherwise transferred.
</FONT>
<P align="left"><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(vi)&nbsp;<U>Exception for Certain Family Transfers</U>. Anything to the contrary
contained in this Section notwithstanding, the transfer of any or all of the
Shares during the Optionee&#146;s lifetime or on the Optionee&#146;s death by will or
intestacy to the Optionee&#146;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
Optionee&#146;s immediate family members shall be exempt from the provisions of this
Section. &#147;Immediate Family&#148; as used herein shall mean the Optionee&#146;s spouse
and issue (including adopted and stepchildren). In such case, the transferee
or other recipient shall receive and hold the Shares so transferred subject to
the provisions of this Section, and there shall be no further transfer of such
Shares except in accordance with the terms of this Section.
</FONT>

<P align="left"><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(vii)&nbsp;<U>Termination of Right of First Refusal</U>. The Right of First Refusal
shall terminate upon the earlier of (i)&nbsp;two (2)&nbsp;years after the date of
issuance to the Optionee of such Common Shares or (ii)&nbsp;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.
</FONT>

<P><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;5.&nbsp;<U>Tax Consultation</U>. Optionee understands that Optionee may suffer
adverse tax consequences as a result of Optionee&#146;s purchase or disposition of
the Shares. Optionee represents that Optionee has consulted with any tax
consultants Optionee deems advisable in connection with the purchase or
disposition of the Shares and that Optionee is not relying on the Company for
any tax advice.
</FONT>
<P><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;6.&nbsp;<U>Market Standoff Agreement</U>. Each Optionee hereby agrees that if so
requested by the Company or any representative of the underwriters in
connection with any registration of the offering of any Shares of the Company
under the Securities Act, such Optionee shall not sell or otherwise transfer,
pledge, hypothecate or otherwise decrease his market risk or beneficial
ownership in any Shares or other securities of the Company during the 180-day
period following the date of the final Prospectus contained in a registration
statement of the Company filed under the Securities Act; provided, however,
that such restriction shall only apply to the first registration statement of
the Company to become effective under the Securities Act which includes
securities to be sold on behalf of the Company to the general public in an
underwritten public offering under the Securities Act. The Company may impose
stop-transfer instructions with respect to securities subject to the foregoing
restrictions until the end of such 180-day period.
</FONT>
<P><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;7.&nbsp;<U>Restrictive Legends and Stop-Transfer Orders</U>.
</FONT>

<P align="left"><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(i)&nbsp;<U>Legends</U>. Optionee understands and agrees that the Company shall cause
the legends set forth below, or legends substantially equivalent thereto, to be

<DIV>&nbsp;</DIV>
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</FONT>

<P><FONT size="2">placed upon any certificate(s) evidencing ownership of the Shares together
with any other legends that may be required by state or federal securities laws
at the time of the issuance of the Shares:
</FONT>
<P>
<TABLE width="100%" border="0" cellpadding="0" cellspacing="0">
<TR>
        <TD width="15%"><FONT size="2">&nbsp;</FONT></TD>
        <TD width="70%"><FONT size="2">THE SHARES REPRESENTED HEREBY HAVE NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED (THE &#147;ACT&#148;), AND MAY NOT BE OFFERED, SOLD OR OTHERWISE TRANSFERRED, PLEDGED OR HYPOTHECATED UNLESS AND UNTIL REGISTERED UNDER THE ACT OR THE ISSUER OF THE SHARES (THE &#147;ISSUER&#148;) HAS RECEIVED AN OPINION OF COUNSEL IN FORM AND SUBSTANCE SATISFACTORY TO THE ISSUER THAT SUCH OFFER, SALE OR TRANSFER, PLEDGE OR HYPOTHECATION IS IN COMPLIANCE WITH THE ACT.</FONT></TD>
        <TD width="15%"><FONT size="2">&nbsp;</FONT></TD>
</TR>
<TR><TD>&nbsp;</TD></TR>
<TR>
        <TD width="15%"><FONT size="2">&nbsp;</FONT></TD>
        <TD width="70%"><FONT size="2">THE SHARES REPRESENTED BY THIS CERTIFICATE ARE SUBJECT TO CERTAIN RESTRICTIONS ON TRANSFER AND A RIGHT OF FIRST REFUSAL HELD BY THE ISSUER OR ITS ASSIGNEE(S) AS SET FORTH IN THE EXERCISE NOTICE BETWEEN THE ISSUER AND THE ORIGINAL HOLDER OF THESE SHARES, A COPY OF WHICH MAY BE OBTAINED AT THE PRINCIPAL OFFICE OF THE ISSUER. SUCH TRANSFER RESTRICTIONS AND RIGHT OF FIRST REFUSAL ARE BINDING ON TRANSFEREES OF THE SHARES REPRESENTED HEREBY.</FONT></TD>
        <TD width="15%"><FONT size="2">&nbsp;</FONT></TD>
</TR>
</TABLE>
<P align="left"><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(ii)&nbsp;<U>Stop-Transfer Notices</U>. Optionee agrees that, in order to ensure
compliance with the restrictions referred to herein, the Company may issue
appropriate &#147;stop transfer&#148; instructions to its transfer agent, if any, and
that, if the Company transfers its own securities, it may make appropriate
notations to the same effect in its own records.
</FONT>

<P align="left"><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(iii)&nbsp;<U>Refusal to Transfer</U>. The Company shall not be required (i)&nbsp;to
transfer on its books any Shares that have been sold or otherwise transferred
in violation of any of the provisions of this Agreement or (ii)&nbsp;to treat as
owner of such Shares or to accord the right to vote or pay dividends to any
purchaser or other transferee to whom such Shares shall have been so
transferred.
</FONT>

<P><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;8. <U>Successors and Assigns</U>. The Company may assign any of its rights under
this Agreement to single or multiple assignees, and this Agreement shall inure
to the benefit of the successors and assigns of the Company. Subject to the
restrictions on transfer herein set forth, this Agreement shall be binding upon
Optionee and his or her heirs, executors, administrators, successors and
assigns.
</FONT>

<DIV>&nbsp;</DIV>
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<P><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;9.&nbsp;<U>Interpretation</U>. Any dispute regarding the interpretation of this
Agreement shall be submitted by Optionee or by the Company forthwith to the
Board of Directors (or Committee if applicable), which shall review such
dispute promptly. The resolution of such a dispute by the Board of Directors
(or Committee if applicable) shall be final and binding on the Company and on
Optionee.
</FONT>

<P><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;10.&nbsp;<U>Governing Law; Severability</U>. This Agreement shall be governed by and
construed in accordance with the laws of the State of California excluding that
body of law pertaining to conflicts of law. Should any provision of this
Agreement be determined by a court of law to be illegal or unenforceable, the
other provisions shall nevertheless remain effective and shall remain
enforceable.
</FONT>

<P><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;11.&nbsp;<U>Notices</U>. Any notice required or permitted hereunder shall be given in
writing and shall be deemed effectively given upon personal delivery or three
(3)&nbsp;days after deposit in the United States mail by certified mail, with
postage and fees prepaid, addressed to the other party at its address as shown
below beneath its signature, or to such other address as such party may
designate in writing from time to time to the other party.
</FONT>

<P><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;12.&nbsp;<U>Further Instruments</U>. The parties agree to execute such further
instruments and to take such further action as may be reasonably necessary to
carry out the purposes and intent of this Agreement.
</FONT>

<P><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;13.&nbsp;<U>Delivery of Payment</U>. Optionee herewith delivers to the Company the
full Exercise Price for the Shares.
</FONT>

<P><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;14.&nbsp;<U>Entire Agreement</U>. The Plan, the Notice of Grant, and the Stock Option
Agreement are incorporated herein by reference. This Agreement, the Plan, the
Notice of Grant, the Stock Option Agreement and the Investment Representation
Statement (if applicable) constitute the entire agreement of the parties and
supersede in their entirety all prior undertakings and agreements of the
Company and Optionee with respect to the subject matter hereof.
</FONT>

<TABLE cellspacing="0" border="0" cellpadding="0" width="100%">
<TR>
        <TD width="50%">&nbsp;</TD>
        <TD width="1%">&nbsp;</TD>
        <TD width="49%">&nbsp;</TD>
</TR>
<TR>
        <TD align="left"><FONT size="2">Submitted by:</FONT></TD>
        <TD><FONT size="2">&nbsp;</FONT></TD>
        <TD align="center"><FONT size="2">Accepted by:</FONT></TD>
</TR>
<TR><TD>&nbsp;</TD></TR>
<TR>
        <TD align="left"><FONT size="2">OPTIONEE:</FONT></TD>
        <TD align="left" colspan="2"><FONT size="2">ADVANCED BIOTHERAPY, INC.</FONT></TD>
</TR>
<TR><TD>&nbsp;</TD></TR>
<TR>
        <TD><FONT size="2">&nbsp;</FONT></TD>
        <TD align="left"><FONT size="2">By:</FONT></TD>
</TR>
<TR>
        <TD colspan="2"><FONT size="2">&nbsp;</FONT></TD>
        <TD><HR size="1" noshade></TD>
</TR>
<TR>
        <TD align="center"><FONT size="2">(Signature)</FONT></TD>
</TR>
<TR><TD>&nbsp;</TD></TR>
<TR>
        <TD><FONT size="2">&nbsp;</FONT></TD>
        <TD align="left"><FONT size="2">Its:</FONT></TD>
</TR>
<TR>
        <TD colspan="2"><FONT size="2">&nbsp;</FONT></TD>
        <TD><HR size="1" noshade></TD>
</TR>
<TR>
        <TD align="center"><FONT size="2">(Social Security Number)</FONT></TD>
</TR>
</TABLE>


<DIV>&nbsp;</DIV>
<P align="center"><FONT size="2">A-45
</FONT>


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<TABLE cellspacing="0" border="0" cellpadding="0" width="100%">
<TR>
        <TD width="1%">&nbsp;</TD>
        <TD width="39%">&nbsp;</TD>
        <TD width="10%">&nbsp;</TD>
        <TD width="1%">&nbsp;</TD>
        <TD width="49%">&nbsp;</TD>
</TR>
<TR valign="top">
        <TD align="left" colspan="2"><FONT size="2"><U>Address</U>:</FONT></TD>
        <TD><FONT size="2">&nbsp;</FONT></TD>
        <TD align="left" colspan="2"><FONT size="2">
<U>Address</U>:<BR>
&nbsp;<BR>
&nbsp;&nbsp;<BR>
&nbsp;&nbsp;</FONT></TD>
</TR>
<TR><TD>&nbsp;</TD></TR>
<TR>
        <TD align="left"><FONT size="2">Date:</FONT></TD>
        <TD colspan="2"><FONT size="2">&nbsp;</FONT></TD>
        <TD align="left"><FONT size="2">Date:</FONT></TD>
</TR>
<TR>
        <TD><FONT size="1">&nbsp;</FONT></TD>
        <TD valign="top"><HR size="1" noshade></TD>
        <TD colspan="2"><FONT size="1">&nbsp;</FONT></TD>
        <TD valign="top"><HR size="1" noshade></TD>
</TR>
</TABLE>


<DIV>&nbsp;</DIV>
<P align="center"><FONT size="2">A-46</FONT>


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<P align="center"><FONT size="2"><B><U>EXHIBIT B</U></B><BR>
&nbsp;<BR>
<B>INVESTMENT REPRESENTATION STATEMENT</B></FONT>

<TABLE cellspacing="0" border="0" cellpadding="0" width="100%">
<TR>
        <TD width="2%">&nbsp;</TD>
        <TD width="18%">&nbsp;</TD>
        <TD width="80%">&nbsp;</TD>
</TR>
<TR>
        <TD><FONT size="2">OPTIONEE</FONT></TD>
        <TD align="center"><FONT size="2">:</FONT></TD>
</TR>
<TR>
        <TD colspan="2"><FONT size="1">&nbsp;</FONT></TD>
        <TD><HR size="1" noshade></TD>
</TR>
<TR><TD>&nbsp;</TD></TR>
<TR>
        <TD valign="top"><FONT size="2">COMPANY</FONT></TD>
        <TD align="center"><FONT size="2">:</FONT></TD>
        <TD align="left"><FONT size="2">ADVANCED BIOTHERAPY, INC.</FONT></TD>
</TR>
<TR><TD>&nbsp;</TD></TR>
<TR>
        <TD align="left"><FONT size="2">SECURITY</FONT></TD>
        <TD align="center"><FONT size="2">:</FONT></TD>
        <TD align="left"><FONT size="2">COMMON STOCK</FONT></TD>
</TR>
<TR><TD>&nbsp;</TD></TR>
<TR valign="bottom">
        <TD align="left"><FONT size="2">AMOUNT</FONT></TD>
        <TD align="center"><FONT size="2">:</FONT></TD>
</TR>
<TR>
        <TD colspan="2"><FONT size="1">&nbsp;</FONT></TD>
        <TD><HR size="1" noshade></TD>
</TR>
<TR>
        <TD align="left"><FONT size="2">DATE</FONT></TD>
        <TD align="center"><FONT size="2">:</FONT></TD>
</TR>
<TR>
        <TD colspan="2"><FONT size="1">&nbsp;</FONT></TD>
        <TD><HR size="1" noshade></TD>
</TR>
</TABLE>

<P><FONT size="2">In connection with the purchase of the above-listed Securities, the undersigned
Optionee represents to the Company the following:
</FONT>
<P align="left"><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(i)&nbsp;Optionee is aware of the Company&#146;s business affairs and financial
condition and has acquired sufficient information about the Company to reach an
informed and knowledgeable decision to acquire the Securities. Optionee is
acquiring these Securities for investment for Optionee&#146;s own account only and
not with a view to, or for resale in connection with, any &#147;distribution&#148;
thereof within the meaning of the Securities Act of 1933, as amended (the
&#147;Securities Act&#148;).
</FONT>

<P align="left"><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(ii)&nbsp;Optionee acknowledges and understands that the Securities constitute
&#147;restricted securities&#148; under the Securities Act and have not been registered
under the Securities Act in reliance upon a specific exemption therefrom, which
exemption depends upon, among other things, the bona fide nature of Optionee&#146;s
investment intent as expressed herein. In this connection, Optionee
understands that, in the view of the Securities and Exchange Commission, the
statutory basis for such exemption may be unavailable if Optionee&#146;s
representation was predicated solely upon a present intention to hold these
Securities for the minimum capital gains period specified under tax statutes,
for a deferred sale, for or until an increase or decrease in the market price
of the Securities, or for a period of one year or any other fixed period in the
future. Optionee further understands that the Securities must be held
indefinitely unless they are subsequently registered under the Securities Act
or an exemption from such registration is available. Optionee further
acknowledges and understands that the Company is under no obligation to
register the Securities. Optionee understands that the certificate evidencing
the Securities will be imprinted with a legend which prohibits the transfer of
the Securities unless they are registered or such registration is not required
in the opinion of counsel satisfactory to the Company and any other legend
required under then applicable state or federal securities laws.
</FONT>

<P align="left"><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(iii)&nbsp;Optionee is familiar with the provisions of Rule&nbsp;701 and Rule&nbsp;144,
each promulgated under the Securities Act, which, in substance, permit limited
public resale of &#147;restricted securities&#148; acquired, directly or indirectly from
the issuer thereof, in
</FONT>

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<P><FONT size="2">a non-public offering subject to the satisfaction of certain conditions.
Rule&nbsp;701 provides that if the issuer qualifies under Rule&nbsp;701 at the time of
the grant of the Option to the Optionee, the exercise will be exempt from
registration under the Securities Act. In the event the Company becomes
subject to the reporting requirements of Section&nbsp;13 or 15(d) of the Securities
Exchange Act of 1934, as amended (the &#147;Exchange Act&#148;) ninety (90)&nbsp;days
thereafter (or such longer period as any market stand-off agreement may
require) the Securities exempt under Rule&nbsp;701 may be resold, subject to the
satisfaction of certain of the conditions specified by Rule&nbsp;144, including:
(1)&nbsp;the resale being made through a broker in an unsolicited &#147;broker&#146;s
transaction&#148; or in transactions directly with a market maker (as said term is
defined under the Exchange Act); and, in the case of an affiliate, (2)&nbsp;the
availability of certain public information about the Company, (3)&nbsp;the amount of
Securities being sold during any three month period not exceeding the
limitations specified in Rule&nbsp;144(e), and (4)&nbsp;the timely filing of a Form&nbsp;144,
if applicable.
</FONT>
<P><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;In the event that the Company does not qualify under Rule&nbsp;701 at the time
of grant of the Option, then the Securities may be resold in certain limited
circumstances subject to the provisions of Rule&nbsp;144, which requires the resale
to occur not less than one year after the later of the date the Securities were
sold by the Company or the date the Securities were sold by an affiliate of the
Company, within the meaning of Rule&nbsp;144; and, in the case of acquisition of the
Securities by an affiliate, or by a non-affiliate who subsequently holds the
Securities less than two years, the satisfaction of the conditions set forth in
sections (1), (2), (3)&nbsp;and (4)&nbsp;of the paragraph immediately above.
</FONT>
<P align="left"><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(iv)&nbsp;Optionee hereby agrees that if so requested by the Company or any
representative of the underwriters (the &#147;Managing Underwriter&#148;) in connection
with any registration of the offering of any securities of the Company under
the Securities Act, Optionee shall not sell or otherwise transfer any Shares or
other securities of the Company during the 180-day period (or such longer
period of time as may be requested in writing by the Managing Underwriter and
agreed to in writing by the Company) (the &#147;Market Standoff Period&#148;) following
the date of the final Prospectus included in a registration statement of the
Company filed under the Securities Act; provided, however, that such
restriction shall only apply to the first registration statement of the Company
to become effective under the Securities Act which includes securities to be
sold on behalf of the Company to the general public in an underwritten public
offering under the Securities Act. The Company may impose stop-transfer
instructions with respect to securities subject to the foregoing restrictions
until the end of such Market Standoff Period.
</FONT>

<P align="left"><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(v)&nbsp;Optionee further understands that in the event all of the applicable
requirements of Rule&nbsp;701 or 144 are not satisfied, registration under the
Securities Act, compliance with Regulation&nbsp;A under the Securities Act, or some
other registration exemption will be required; and that, notwithstanding the
fact that Rules&nbsp;144 and 701 are not exclusive, the Staff of the Securities and
Exchange Commission has expressed its opinion that persons proposing to sell
private placement securities other than in a registered offering and otherwise
than pursuant to Rules&nbsp;144 or 701 will have a substantial burden of proof in
establishing that an exemption from registration is available for such offers
or sales, and that such persons and their respective brokers who participate in
such transactions do so at their own risk. Optionee understands that no


<P align="center"><FONT size="2">A-48</FONT>
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</FONT>

<P><FONT size="2">assurances can be given that any such other registration exemption will be
available in such event.
</FONT>

<P>
<TABLE cellspacing="0" border="0" cellpadding="0" width="100%">
<TR>
        <TD width="50%">&nbsp;</TD>
        <TD width="1%">&nbsp;</TD>
        <TD width="49%">&nbsp;</TD>
</TR>
<TR>
        <TD><FONT size="2">&nbsp;</FONT></TD>
        <TD align="left" colspan="2"><FONT size="2">Signature of Optionee:</FONT></TD>
</TR>
<TR><TD>&nbsp;<BR>&nbsp;</TD></TR>
<TR>
        <TD><FONT size="1">&nbsp;</FONT></TD>
        <TD colspan="2"><HR size="1" noshade></TD>
</TR>
<TR><TD>&nbsp;<BR>&nbsp;</TD></TR>
<TR>
        <TD><FONT size="1">&nbsp;</FONT></TD>
        <TD><FONT size="2">Date:</FONT></TD>
</TR>
<TR>
        <TD colspan="2"><FONT size="1">&nbsp;</FONT></TD>
        <TD><HR size="1" noshade></TD>
</TR>
</TABLE>



<P align="center"><FONT size="2">A-49</FONT>
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<!-- link1 "APPENDIX B" -->
<DIV align="left"><A NAME="006"></A></DIV>

<P align="right"><FONT size="2"><B>APPENDIX B</B></FONT>

<P align="center"><FONT size="2"><B>AUDIT COMMITTEE CHARTER</B><BR>
&nbsp;<BR>
<B>ADVANCED BIOTHERAPY, INC.</B></FONT>

<P align="left"><FONT size="2"><B>PURPOSE</B>
</FONT>
<HR size="1" noshade>

<P><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;The primary purpose of the Audit Committee (the &#147;Committee&#148;) is to assist
the Board of Directors (the &#147;Board&#148;) in fulfilling its responsibility to
oversee management&#146;s conduct of the Company&#146;s financial reporting process,
including by overviewing the financial reports and other financial information
provided by the Company to any governmental or regulatory body, the public or
other users thereof, the Company&#146;s systems of internal accounting and financial
controls, and the annual independent audit of the Company&#146;s financial
statements.
</FONT>
<P><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;In discharging its oversight role, the Committee is empowered to
investigate any matter brought to its attention with full access to all books,
records, facilities and personnel of the Company and the power to retain
outside counsel, auditors or other experts for this purpose. The outside
auditor is ultimately accountable to the Board and the Committee.
</FONT>
<P><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;The Committee shall review the adequacy of this Charter on an annual
basis.
</FONT>

<P align="left"><FONT size="2"><B>MEMBERSHIP</B>
</FONT>
<HR size="1" noshade>

<P><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;The Committee shall be comprised of not less than three members of the
Board, and the Committee&#146;s composition will meet the requirements of the Audit
Committee Policy of the NASD and any securities exchange upon which the common
stock of the Company shall be listed. Accordingly, all of the members will be
directors:
</FONT>
<P><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;1.&nbsp;Who have no relationship to the Company that may interfere with the
exercise of their independence from management and the Company; and
</FONT>
<P><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;2.&nbsp;Who are financially literate or who become financially literate within
a reasonable period of time after appointment to the Committee. In addition,
at least one member of the Committee will have accounting or related financial
management expertise.
</FONT>

<P align="left"><FONT size="2"><B>KEY RESPONSIBILITIES</B>
</FONT>
<HR size="1" noshade>

<P><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;The Committee&#146;s job is one of oversight and it recognizes that the
Company&#146;s management is responsible for preparing the Company&#146;s financial
statements and that
</FONT>

<DIV>&nbsp;</DIV>
<P align="center"><FONT size="2">B-1
</FONT>


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<P><FONT size="2"> the outside auditors are responsible for auditing those financial
statements. Additionally, the Committee recognizes that financial management,
as well as the outside auditors, have more time, knowledge and more detailed
information on the Company than do Committee members; consequently, in carrying
out its oversight responsibilities, the Committee is not providing any expert
or special assurance as to the Company&#146;s financial statements or any
professional certification as to the outside auditor&#146;s work.
</FONT>
<P><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;The following functions shall be the common recurring activities of the
Committee in carrying out its oversight function. These functions are set
forth as a guide with the understanding that the Committee may diverge from
this guide as appropriate given the circumstances:
</FONT>
<P>
<TABLE width="100%" border="0" cellpadding="0" cellspacing="0">
<TR valign="top">
   <TD width="1%" align="right" nowrap><FONT size="2">1.</FONT></TD>
   <TD width="1%" nowrap><FONT size="2">&nbsp;&nbsp;</FONT></TD>
   <TD width="98%"><FONT size="2">The Committee shall review with management and the outside auditors the
audited financial statements to be included in the Company&#146;s Annual Report
on Form l0-KSB (or the Annual Report to Shareholders if distributed prior
to the filing of Form&nbsp;10-KSB) and review and consider with the outside
auditors the matters required to be discussed by applicable statements of
auditing standards.</FONT></TD>
</TR>
<TR>
        <TD><FONT size="2">&nbsp;</FONT></TD>
</TR>
<TR valign="top">
   <TD width="1%" align="right" nowrap><FONT size="2">2.</FONT></TD>
   <TD width="1%" nowrap><FONT size="2">&nbsp;&nbsp;</FONT></TD>
   <TD width="98%"><FONT size="2">As a whole, or through the Committee chair, the Committee shall review
with the outside auditors the Company&#146;s interim financial results to be
included in the Company&#146;s quarterly reports to be filed with Securities
and Exchange Commission and the matters required to be discussed by
applicable statements of auditing standards; this review will occur prior
to the Company&#146;s filing of the Form&nbsp;10-QSB.</FONT></TD>
</TR>
<TR>
        <TD><FONT size="2">&nbsp;</FONT></TD>
</TR>
<TR valign="top">
   <TD width="1%" align="right" nowrap><FONT size="2">3.</FONT></TD>
   <TD width="1%" nowrap><FONT size="2">&nbsp;&nbsp;</FONT></TD>
   <TD width="98%"><FONT size="2">The Committee shall discuss with management and the outside auditors the
quality and adequacy of the Company&#146;s internal controls.</FONT></TD>
</TR>
<TR>
        <TD><FONT size="2">&nbsp;</FONT></TD>
</TR>
<TR valign="top">
   <TD width="1%" align="right" nowrap><FONT size="2">4.</FONT></TD>
   <TD width="1%" nowrap><FONT size="2">&nbsp;&nbsp;</FONT></TD>
   <TD width="98%"><FONT size="2">The Committee shall:</FONT></TD>
</TR>
</TABLE>
<P>
<TABLE width="100%" border="0" cellpadding="0" cellspacing="0">
<TR valign="top">
   <TD width="1%" nowrap><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;</FONT></TD>
   <TD width="1%" align="right" nowrap><FONT size="2">a.</FONT></TD>
   <TD width="1%" nowrap><FONT size="2">&nbsp;&nbsp;</FONT></TD>
   <TD width="97%"><FONT size="2">request from the outside auditors annually, a formal written statement
delineating all relationships between the auditor and the Company consistent
with applicable statements of auditing standards</FONT></TD>
</TR>
<TR>
        <TD><FONT size="2">&nbsp;</FONT></TD>
</TR>
<TR valign="top">
   <TD width="1%" nowrap><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;</FONT></TD>
   <TD width="1%" align="right" nowrap><FONT size="2">b.</FONT></TD>
   <TD width="1%" nowrap><FONT size="2">&nbsp;&nbsp;</FONT></TD>
   <TD width="97%"><FONT size="2">discuss with the outside auditors any such disclosed
relationship and their impact on the outside auditor&#146;s independence;
and</FONT></TD>
</TR>
<TR>
        <TD><FONT size="2">&nbsp;</FONT></TD>
</TR>
<TR valign="top">
   <TD width="1%" nowrap><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;</FONT></TD>
   <TD width="1%" align="right" nowrap><FONT size="2">c.</FONT></TD>
   <TD width="1%" nowrap><FONT size="2">&nbsp;&nbsp;</FONT></TD>
   <TD width="97%"><FONT size="2">recommend that the Board take appropriate action in response
to the outside auditor&#146;s report to satisfy itself of the auditor&#146;s
independence.</FONT></TD>
</TR>
</TABLE>
<P>
<TABLE width="100%" border="0" cellpadding="0" cellspacing="0">
<TR valign="top">
   <TD width="1%" align="right" nowrap><FONT size="2">5.</FONT></TD>
   <TD width="1%" nowrap><FONT size="2">&nbsp;&nbsp;</FONT></TD>
   <TD width="98%"><FONT size="2">The Committee, subject to any action that may be taken by the full Board,
shall have the ultimate authority and responsibility to select (or
nominate for shareholder approval), evaluate and, where appropriate,
replace the outside auditor.</FONT></TD>
</TR>
</TABLE>

<DIV>&nbsp;</DIV>
<P align="center"><FONT size="2">B-2</FONT>


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<P align="center"><FONT size="2">PROXY</FONT>

<P align="center"><FONT size="2">ADVANCED BIOTHERAPY, INC.</FONT>

<P align="center"><FONT size="2">THIS PROXY IS BEING SOLICITED BY THE BOARD OF DIRECTORS</FONT>

<P align="center"><FONT size="2">FOR AN ANNUAL MEETING OF STOCKHOLDERS</FONT>

<P align="center"><FONT size="2">TO BE HELD ON DECEMBER 13, 2001</FONT>

<P><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;The undersigned stockholder appoints Edmond Buccellato and Alexander L.
Cappello, or either of them, as proxy with full power of substitution, to vote
the shares of common stock of Advanced Biotherapy, Inc., a Delaware corporation
(the &#147;Company&#148;), which the undersigned is entitled to vote at an Annual Meeting
of Stockholders to be held at the Woodland Hills Marriott, 21850
Oxnard Street, Woodland Hills, California 91367 on December&nbsp;13, 2001,
at 2:00&nbsp;p.m., local time, and at any adjournments thereof (the &#147;Meeting&#148;), upon matters properly coming
before the meeting, as set forth in the Notice of Annual Meeting and Proxy
Statement, both of which have been received by the undersigned. Without
otherwise limiting the general authorization given hereby, such proxy is
instructed to vote as follows:
</FONT>
<P><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;THIS PROXY WILL BE VOTED AS DIRECTED, OR IF NO CONTRARY DIRECTION IS
INDICATED, WILL BE VOTED FOR THE PROPOSALS INDICATED ON THIS CARD AND AS SUCH
PROXIES DEEM ADVISABLE WITH DISCRETIONARY AUTHORITY ON SUCH OTHER BUSINESS AS
MAY PROPERLY COME BEFORE THE MEETING AND ANY ADJOURNMENT OR ADJOURNMENTS
THEREOF.
</FONT>
<P><FONT size="2">1.&nbsp;To elect to the Board of Directors eight (8)&nbsp;directors to serve until the
next Annual Meeting of Stockholders of the Company and until their successors
are elected and qualified, or until death, resignation or removal.
</FONT>
<P><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&#091;&nbsp;&nbsp;&nbsp;&#093; FOR all nominees listed herein (except as marked up to the contrary
below).
</FONT>
<P><FONT size="2">(INSTRUCTIONS: To withhold authority to vote for any individual nominee, strike
a line through the nominee&#146;s name listed below.)
</FONT>
<CENTER>
<TABLE cellspacing="0" border="0" cellpadding="0" width="100%">
<TR valign="bottom">
        <TD width="48%">&nbsp;</TD>
        <TD width="4%">&nbsp;</TD>
        <TD width="48%">&nbsp;</TD>
</TR>
<TR valign="bottom">
        <TD valign="top"><FONT size="2">SIMON SKURKOVICH, M.D.</FONT></TD>
        <TD><FONT size="2">&nbsp;</FONT></TD>
        <TD align="left" valign="top"><FONT size="2">
BORIS SKURKOVICH, M.D.</FONT></TD>
</TR>
<TR><TD><TR><TD><TR><TD><TR><TD>
<TR><TD><TR><TD><TR><TD><TR><TD>
<TR><TD><TR><TD><TR><TD><TR><TD>

<TR valign="bottom">
        <TD valign="top"><FONT size="2">LAWRENCE LOOMIS</FONT></TD>
        <TD><FONT size="2">&nbsp;</FONT></TD>
        <TD align="left" valign="top"><FONT size="2">
EDMOND BUCCELLATO</FONT></TD>
</TR>
<TR><TD><TR><TD><TR><TD><TR><TD>
<TR><TD><TR><TD><TR><TD><TR><TD>
<TR><TD><TR><TD><TR><TD><TR><TD>

<TR valign="bottom">
        <TD valign="top"><FONT size="2">LEONARD MILLSTEIN</FONT></TD>
        <TD><FONT size="2">&nbsp;</FONT></TD>
        <TD align="left" valign="top"><FONT size="2">
ALEXANDER L. CAPPELLO</FONT></TD>
</TR>
<TR><TD><TR><TD><TR><TD><TR><TD>
<TR><TD><TR><TD><TR><TD><TR><TD>
<TR><TD><TR><TD><TR><TD><TR><TD>

<TR valign="bottom">
        <TD valign="top"><FONT size="2">JOHN M. BENDHEIM</FONT></TD>
        <TD><FONT size="2">&nbsp;</FONT></TD>
        <TD align="left" valign="top"><FONT size="2">
THOMAS J. PERNICE</FONT></TD>
</TR>
</TABLE>
</CENTER>
<P align="center"><FONT size="2">Page 1 of 3
</FONT>

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<P><FONT size="2">2.&nbsp;To approve the adoption of the Company&#146;s 2000 Omnibus Equity Incentive
Plan.
</FONT>
<P><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&#091;&nbsp;&nbsp;&nbsp;&#093;&nbsp;&nbsp;&nbsp;&nbsp; FOR
 &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&#091;&nbsp;&nbsp;&nbsp;&#093;&nbsp;&nbsp;&nbsp;&nbsp; AGAINST
 &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&#091;&nbsp;&nbsp;&nbsp;&#093;&nbsp;&nbsp;&nbsp;&nbsp; ABSTAIN
</FONT>
<P><FONT size="2">3.&nbsp;To approve a reverse stock split in a range
not to exceed a one-for-ten
reverse split, i.e., at a ratio of at least 1:10, provided such reverse stock
split <U>shall not be adopted  unless</U> a Significant Transaction shall
have occurred and the Board of Directors makes a determination
within three (3) years after the Annual Meeting that such stock split is in the best
interest of the Company&#146;s stockholders, which transaction and
determination <U>have not occurred.</U>
</FONT>
<P><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&#091;&nbsp;&nbsp;&nbsp;&#093;&nbsp;&nbsp;&nbsp;&nbsp; FOR
 &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&#091;&nbsp;&nbsp;&nbsp;&#093;&nbsp;&nbsp;&nbsp;&nbsp; AGAINST
 &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&#091;&nbsp;&nbsp;&nbsp;&#093;&nbsp;&nbsp;&nbsp;&nbsp; ABSTAIN
</FONT>
<P><FONT size="2">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;In the discretion of the Board of Directors, the proxy is authorized to
vote upon such other business as may properly come before the meeting.
</FONT>
<P>
<TABLE width="100%" border="0" cellpadding="0" cellspacing="0">
<TR valign="top">
        <TD width="1%"><FONT size="2">&nbsp;</FONT></TD>
        <TD width="20%"><FONT size="2">&nbsp;</FONT></TD>
        <TD width="5%"><FONT size="2">&nbsp;</FONT></TD>
        <TD width="24%"><FONT size="2">&nbsp;</FONT></TD>
</TR>
<TR valign="top">
        <TD><FONT size="2">DATED:</FONT></TD>
        <TD><FONT size="2">&nbsp;</FONT></TD>
        <TD><FONT size="2">&nbsp;</FONT></TD>
        <TD><FONT size="2">&nbsp;</FONT></TD>
</TR>
<TR valign="top">
        <TD><FONT size="2">&nbsp;</FONT></TD>
        <TD><FONT size="2"><HR SIZE="1"></FONT></TD>
        <TD><FONT size="2">&nbsp;</FONT></TD>
        <TD><FONT size="2"><HR SIZE="1"></FONT></TD>
</TR>
<TR valign="top">
        <TD><FONT size="2">&nbsp;</FONT></TD>
        <TD><FONT size="2">&nbsp;</FONT></TD>
        <TD><FONT size="2">&nbsp;</FONT></TD>
        <TD><FONT size="2">Signature</FONT></TD>
</TR>
<TR valign="top">
        <TD><FONT size="2">&nbsp;</FONT></TD>
        <TD><FONT size="2">&nbsp;</FONT></TD>
        <TD><FONT size="2">&nbsp;</FONT></TD>
        <TD><FONT size="2">&nbsp;</FONT></TD>
</TR>
<TR valign="top">
        <TD><FONT size="2">&nbsp;</FONT></TD>
        <TD><FONT size="2">&nbsp;</FONT></TD>
        <TD><FONT size="2">&nbsp;</FONT></TD>
        <TD><FONT size="2">&nbsp;</FONT></TD>
</TR>
<TR valign="top">
        <TD><FONT size="2">&nbsp;</FONT></TD>
        <TD><FONT size="2">&nbsp;</FONT></TD>
        <TD><FONT size="2">&nbsp;</FONT></TD>
        <TD><FONT size="2"><HR SIZE="1"></FONT></TD>
</TR>
<TR valign="top">
        <TD><FONT size="2">&nbsp;</FONT></TD>
        <TD><FONT size="2">&nbsp;</FONT></TD>
        <TD><FONT size="2">&nbsp;</FONT></TD>
        <TD><FONT size="2">Signature of joint holder (if applicable)</FONT></TD>
</TR>
<TR valign="top">
        <TD><FONT size="2">&nbsp;</FONT></TD>
        <TD><FONT size="2">&nbsp;</FONT></TD>
        <TD><FONT size="2">&nbsp;</FONT></TD>
        <TD><FONT size="2">&nbsp;</FONT></TD>
</TR>
<TR valign="top">
        <TD><FONT size="2">&nbsp;</FONT></TD>
        <TD><FONT size="2">&nbsp;</FONT></TD>
        <TD><FONT size="2">&nbsp;</FONT></TD>
        <TD><FONT size="2">&nbsp;</FONT></TD>
</TR>
<TR valign="top">
        <TD><FONT size="2">&nbsp;</FONT></TD>
        <TD><FONT size="2">&nbsp;</FONT></TD>
        <TD><FONT size="2">&nbsp;</FONT></TD>
        <TD><FONT size="2"><HR SIZE="1"></FONT></TD>
</TR>
<TR valign="top">
        <TD><FONT size="2">&nbsp;</FONT></TD>
        <TD><FONT size="2">&nbsp;</FONT></TD>
        <TD><FONT size="2">&nbsp;</FONT></TD>
        <TD><FONT size="2">Print Name(s)</FONT></TD>
</TR>
</TABLE>
<P><FONT size="2">(Please sign exactly as your name appears hereon. When signing as attorney,
executor, administrator, trustee or guardian, please give your full title. If
shares are jointly held, each holder must sign. If a corporation, please sign
in full corporate name by President or other authorized officer and Secretary
or other additional officer. If a partnership, trust or other entity, please
sign in the partnership or trust or other entity name by an authorized person).
</FONT>
<P><FONT size="2">WHETHER OR NOT YOU EXPECT TO ATTEND THE MEETING, PLEASE CHECK THE BOXES ABOVE
AND, IF DESIRED, MARK ANY INDIVIDUAL DIRECTOR-NOMINEE&#146;S NAME, SIGN, DATE AND
RETURN THIS PROXY TO AMERICAN STOCK TRANSFER &#038; TRUST CO., 40 WALL STREET, NEW
YORK, NEW YORK 10005, ATTN: PROXY SERVICES, IN THE SELF-ADDRESSED ENVELOPE
PROVIDED.
</FONT>
<P><FONT size="2">THE PERSONS NAMED IN THE ACCOMPANYING PROXY CARD ARE DIRECTORS OR OFFICERS OF
THE COMPANY. A STOCKHOLDER HAS THE RIGHT TO APPOINT A PERSON OTHER THAN THE
PERSON NAMED IN THE ENCLOSED PROXY CARD TO
</FONT>
<P align="center"><FONT size="2">Page 2 of 3
</FONT>

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<H5 align="left" style="page-break-before:always"><A HREF="#toc">Table of Contents</A></H5><P>

<P><FONT size="2">ATTEND AND ACT FOR HIM ON HIS BEHALF
AT THE MEETING. TO EXERCISE THIS RIGHT, A STOCKHOLDER SHALL STRIKE OUT THE
NAMES OF THE PERSONS NAMED IN THE PROXY CARD AND INSERT THE NAME OF HIS OR HER
NOMINEE IN THE BLANK SPACE PROVIDED, OR COMPLETE ANOTHER PROXY CARD. THE
COMPLETED PROXY CARD SHOULD BE DEPOSITED WITH
THE COMPANY&#146;S TRANSFER AGENT, AMERICAN STOCK TRANSFER &#038; TRUST CO., 40 WALL
STREET, NEW YORK, NEW YORK 10005, AT LEAST 10 DAYS PRIOR TO THE MEETING OR
DELIVERED TO THE COMPANY AT 6355 TOPANGA CANYON BOULEVARD, SUITE 510, WOODLAND
HILLS CALIFORNIA 91367 AT LEAST 48 HOURS BEFORE THE TIME OF THE MEETING OR ANY
ADJOURNMENT THEREOF. IN ADDITION, A STOCKHOLDER MAY REVOKE A PROXY PREVIOUSLY
GIVEN BY ATTENDING THE ANNUAL MEETING IN PERSON AND VOTING.
</FONT>

<P align="center"><FONT size="2">Page 3 of 3</FONT>

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