EXHIBIT 10.5

                              HELIX BIOMEDIX, INC.

                             2000 STOCK OPTION PLAN

                       INITIALLY ADOPTED: NOVEMBER 6, 2000
                             AMENDED: AUGUST 1, 2002

1. INTRODUCTIONS AND DEFINITIONS

1.1  THE PLAN

     This 2000 Stock Option Plan (hereinafter, this "Plan") establishes the
     right of and procedures for Helix BioMedix, Inc. (the "Company") to grant
     stock options to its employees, consultants and/or directors. This Plan
     provides for the granting of two types of options, namely (1) Incentive
     Stock Options, as defined and governed by Section 422 of the Internal
     Revenue Code of 1986, as amended and (2) Nonqualified Stock Options. This
     Plan sets forth provisions applicable to both types of options, to
     Incentive Stock Options only and to Nonqualified Stock Options only.

1.2  DEFINITIONS

     Capitalized terms used in this Plan shall have the following meanings:

     "ACT" means the Securities Act of 1933, as from time to time amended, or
     any replacement act or legislation.

     "BOARD" means the Board of Directors of the Company.

     "CAUSE" means dishonesty, fraud, misconduct, unauthorized use or disclosure
     of confidential information or trade secrets, any act of disloyalty to the
     Company or any current or future subsidiary of the Company, or conviction
     or confession of a crime punishable by law (except minor violations), in
     each case as determined by the Board, whose determination shall be
     conclusive and binding.

     "CHANGE OF CONTROL EVENT" means a merger, consolidation, or sale of assets,
     as the case may be and as described in Subsections (1) and (2) of Section
     2.5(a).

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

     "COMMITTEE" means a committee appointed by the Board, pursuant to Section
     2.3 hereof, to administer the provisions of this Plan and in the absence of
     any such committee, references to the Committee shall mean the Board.

     "COMPANY" means Helix BioMedix, Inc., a Delaware corporation.

     "CONSULTANT" means any person engaged by the Company or any current or
     future subsidiary of the Company to perform services as a non-employee
     service provider, advisor or consultant pursuant to the terms of a written
     plan or contract. "Consultants" is the plural of Consultant.

     "DIRECTOR" means a member of the Board. "Directors" is the plural of
     Director.

     "DISABILITY" means "permanent and total disability" as that term is defined
     for purposes of Section 22(e)(3) of the Code.

     "EMPLOYEE" means, for purposes of this Plan, persons continuously employed
     by the Company or by any current or future subsidiary of the Company on a
     regular basis, whether full-time or part-time, at any time during the
     duration hereof. "Employees" is the plural of Employee.

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     "EXCHANGE ACT" means the Securities Exchange Act of 1934, as from time to
     time amended, or any replacement act or legislation.

     "EXECUTIVE OFFICER" means the Chief Executive Officer, the Chief Scientific
     Officer, the Executive Vice President and the Chief Financial Officer of
     the Company and any other officer of the Company specifically designated by
     the Board as an Executive Officer.

     "FAIR MARKET VALUE" of the Company's common stock for any class shall be
     the average of the high and low per share sales prices for the common stock
     as reported by the Nasdaq National Market for a single trading. If there is
     no such reported price for the common stock for the date in question, then
     such price on the last preceding date for which such price exists shall be
     determinative of the Fair Market Value.

     "GOOD REASON" means the occurrence of any one of the following events, in
     the event that the Optionee (i) has given the Successor Corporation written
     notice of such occurrence and the Successor Corporation has failed to cure
     such event within thirty (30) days, and (ii) Optionee resigns within sixty
     (60) days following the expiration of such thirty-day period:

     (a)  Relocation of the Optionee to any place greater than fifty (50) miles
          from his or her principal location prior to the occurrence of the
          Corporate Transaction, except for reasonably required travel on the
          Successor Corporation's business that is not materially greater than
          such travel requirements prior to the Corporate Transaction; or

     (b)  Substantial reduction of the Optionee's compensation package, unless
          such a reduction is made by the Company ratably with all other
          employees at similar levels of responsibility.

     "INCENTIVE STOCK OPTION" means an option issued by the Company to purchase
     shares of stock of the Company that meets the definition of "incentive
     stock option" contained in Section 422 of the Code and that is issued by
     the Company to be an Incentive Stock Option. "Incentive Stock Options" is
     the plural of Incentive Stock Option.

     "NONQUALIFIED STOCK OPTION" means an option issued by the Company to
     purchase shares of stock of the Company that is not an Incentive Stock
     Option. "Nonqualified Stock Options" is the plural of Nonqualified Stock
     Option.

     "OPTIONEE" means the recipient of a Stock Option pursuant to a Stock Option
     Agreement. "Optionees" is the plural of Optionee.

     "PLAN" means this Helix BioMedix, Inc. 2000 Stock Option Plan, which also
     may be referred to as the "Helix BioMedix, Inc. Stock Option Plan."

     "PLAN GUIDELINES" shall mean the guidelines, rules, policies, regulations,
     forms of notice and forms of agreements and instruments, if any, adopted
     and amended by the Board from time to time with respect to this Plan
     pursuant to Section 2.3.

     "SHARES" shall mean the Shares of the Company reserved for issuance under
     this Plan as further defined in Section 2.2.

     "STOCK OPTION" means an agreement entered into by the Company granting the
     recipient the right to purchase shares of stock of the Company, at certain
     times and under certain conditions, subject to certain obligations and
     responsibilities as defined in this Plan and in the written Stock Option
     Agreement, whether an Incentive Stock Option or a Nonqualified Stock
     Option. "Stock Options" is the plural of Stock Option.

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     "STOCK OPTION AGREEMENT" means the written contract by which a Stock Option
     is granted by the Company to an Optionee. "Stock Option Agreements" is the
     plural of Stock Option Agreement.

     "SUCCESSOR CORPORATION" has the meaning set forth under Section 2.5(b).

2.   GENERAL PROVISIONS APPLICABLE TO BOTH NONQUALIFIED STOCK OPTIONS AND
     INCENTIVE STOCK OPTIONS GRANTED BY THE COMPANY.

2.1  OBJECTIVES OF THIS PLAN

     The purpose of this Plan is to encourage ownership of Common Stock of the
     Company by Employees and to provide a means of granting Stock Options to
     Consultants and Directors. This Plan is intended to provide an incentive to
     Employees for maximum effort in the successful operation of the Company and
     is expected to benefit the shareholders by enabling the Company to attract
     and retain personnel of the best available talent through the opportunity
     to share in the increased value of the Company's shares to which such
     personnel have contributed. The benefits of this Plan are not a substitute
     for compensation otherwise payable to Employees pursuant to the terms of
     their employment.

2.2  STOCK RESERVED FOR THIS PLAN

     Subject to the provisions of Section 2.10, the number of shares reserved
     for issuance upon the exercise of Stock Options granted under this Plan
     shall be 5,400,000 shares of the Common Stock of the Company (the
     "Shares"), which Shares shall be reserved from the Company's authorized and
     unissued shares. Shares subject to any Stock Option under this Plan which
     are not exercised in full or Shares as to which the right to purchase is
     forfeited through default or otherwise, shall remain available for other
     Stock Options under this Plan. The aggregate number of Shares subject to
     Stock Options under this Plan or reserved for issuance by the Board shall
     not exceed the number approved by the shareholders at the time of adoption
     hereof unless such increase is approved by the Company's shareholders. Such
     approval shall be by the affirmative vote of shareholders holding a
     majority of the issued and outstanding shares of common stock of the
     Company entitled to vote at a meeting called to approve said increase.

2.3  ADMINISTRATION OF THIS PLAN

     (a)  This Plan shall be administered by the Board or the Committee
          appointed pursuant to Section 2.3(b), provided that at all times
          during which the Company is subject to the periodic reporting
          requirements of the Exchange Act each member of the Board or the
          Committee who participates in administration must be a "Non-Employee
          Director" as that term is defined in Rule 16b-3 of the Exchange Act.

     (b)  The Board may appoint a Board committee (the "Committee") to
          administer this Plan in the name of the Board. The Board or the
          Committee so appointed shall have full power and authority to
          administer and interpret this plan and to adopt, from time to time,
          such guidelines, rules, policies, regulations, forms of notice and
          forms of agreements and instruments for the administration of the Plan
          (collectively, "Plan Guidelines") as the Board or such Committee, as
          the case may be, deems necessary or advisable. Such powers include,
          but are not limited to (subject to the specific limitations described
          herein), authority to determine the Employees, Consultants and
          Directors to be granted Stock Options under this Plan, to determine
          the size, type and applicable terms and conditions of grants to be
          made to such Employees, Consultants and Directors, to determine a time
          when Stock Options will be granted and to authorize grants to eligible
          Employees, Consultants and Directors.

     (c)  The interpretations by the Board or its appointed Committee of this
          Plan and all Stock Option Agreements, including the definitions of
          terms used herein and in Stock Option Agreements, and all actions
          taken and determinations made by the Board or its appointed Committee
          concerning any matter arising under or with respect to this Plan or
          any Stock Options granted pursuant to this plan, shall be final,
          binding and conclusive on all interested parties, including the
          Company, it's shareholders and all former, present and future

<PAGE>

          Employees, Consultants and Directors of the Company. So long as the
          Company is not subject to the reporting requirements of the Exchange
          Act, the Board may delegate some or all of its power and authority
          hereunder to the duly elected officers of the Company, such delegation
          to be subject to such terms and conditions as the Board in its
          discretion shall determine. Such delegation of authority may be
          contained in the Plan Guidelines. The Board or its appointed Committee
          may, as to questions of accounting, rely conclusively upon any
          determinations made by independent public accountants of the Company.

     (d)  The Chief Executive Officer of the Company shall have the authority to
          determine from time to time (i) the persons to whom Stock Options are
          to be granted; (ii) the number of shares of Common Stock for which the
          Stock Options are exercisable and the purchase price of such shares;
          (iii) whether the Stock Options are Incentive Stock Options or
          nonqualified Stock Options; and (iv) any other terms and conditions
          (which need not be identical) of the Stock Options so long as such
          terms and conditions would be permissible under the provisions of this
          Plan if the Stock Options were granted by the Directors or the
          appointed Committee; provided, however that (A) the Chief Executive
          Officer may not grant any Stock Options to any person who is an
          Executive Officer or a Director of the Company at the time of the
          grant; (B) the purchase price of each share of Common Stock under a
          Stock Option granted under this section 2.3 (d) shall not be less than
          the Fair Market Value of such share on the date of grant of the Stock
          Option; and (C) the Chief Executive Officer shall promptly provide a
          report to the Committee of each person to whom a Stock Option has been
          granted under this Section 2.3 (d) and the material terms and
          conditions of the Stock Option.

2.4  ELIGIBILITY; FACTS TO BE CONSIDERED IN GRANTING STOCK OPTIONS

     The Board shall have the authority to determine the persons eligible to
     receive a Stock Option, the time or times at which the Shares may be
     purchased and whether all of the Stock Options may be exercised at one time
     or in increments.

2.5  RIGHTS OF  OPTIONEE  IN EVENT OF MERGER,  CONSOLIDATION,  SALE OF ASSETS OR
     DISSOLUTION

     (a)  Except as provided in this Section 2.5 and in Section 13, and
          notwithstanding anything in this Plan to the contrary, if the Optionee
          is not then an Executive Officer of the Company, the Optionee may
          conditionally purchase during the periods set forth below in
          Subsections (1) through (3) of this Section 2.5 (a), the amount of
          Shares for which the right to purchase has already vested plus (i) the
          number of Shares for which the right to purchase, according to the
          terms of the Stock Option Agreement relating to such Shares, is
          scheduled to vest within 12 months of the effective, closing, or
          filing date, as the case may be, of a merger, consolidation, sales of
          assets, or dissolution, as described below, or (ii) fifty percent
          (50%) of the number of Shares for which the right to purchase has not
          yet vested, whichever is greater. Except as provided in this Section
          2.5 and notwithstanding anything in this Plan to the contrary, if the
          Optionee is then an Executive Officer of the Company, the Optionee may
          conditionally purchase all of his vested or unvested Shares during the
          periods set forth below in Subsections (1) through (3) of this Section
          2.5 (a).

          (1) The period commencing ten (10) days and ending five (5) days prior
              to the scheduled effective date of a merger or consolidation (as
              such effective date may be delayed from time to time) wherein the
              Company is not to be the surviving corporation and the
              shareholders of the corporation immediately prior to the merger or
              consolidation are not to own a majority of the capital stock of
              the surviving corporation immediately after the merger or
              consolidation, provided such merger or consolidation is not
              between or among the Company and other corporations related to or
              affiliated with the Company;

          (2) The period commencing ten (10) days and ending five (5) days prior
              to the scheduled closing date of a sale of all or substantially
              all of the assets of the Company (as such closing date may be
              delayed from time to time); and

<PAGE>

          (3) The period commencing the date the shareholders of the Company
              approve the dissolution of the Company and ending five (5) days
              prior to the date of filing its Articles of Dissolution.

          If the merger, consolidation, sale of assets (collectively, a "Change
          of Control Event"), or dissolution, as the case may be and as
          described in Subsections (1) through (3) of this Section 2.5(a), once
          commenced, is canceled or revoked, the conditional purchase of Shares
          for which the right to purchase would not have otherwise vested at the
          time of said cancellation or revocation, but for the operation of this
          Section 2.5, shall be rescinded. With respect to all other Shares
          conditionally purchased, the Optionee may rescind such purchase at
          Optionee's discretion. If the Change of Control Event does occur or
          Articles of Dissolution are filed, as the case may be and as described
          in Subsections (1) through (3) of this Section 2.5(a), all unexercised
          Stock Options that have not been assumed pursuant to Section 2.5(b)
          shall terminate on the effective, closing, or filing date, as the case
          may be.

     (b)  The Optionee shall have no right to conditionally purchase Shares for
          which the right to purchase would not have otherwise vested but for
          the operation of this Section 2.5 if:

          (1) The Stock Option relating to such Shares, in connection with the
              Change of Control Event, is either to be assumed by the successor
              or purchasing corporation or parent thereof (the "Successor
              Corporation") or to be replaced with a comparable award for the
              purchase of shares of the capital stock of the Successor
              Corporation; or

          (2) The Stock Option relating to such Shares is to be replaced with a
              cash incentive program of the Successor Corporation that preserves
              the spread existing at the time of the Change of Control Event and
              provides for subsequent payout in accordance with the same vesting
              schedule applicable to such Stock Option. For purposes of this
              Section 2.5(b)(2), the spread existing at the time of a Change of
              Control Event means the difference between the exercise price per
              Share of the Stock Option and the Fair Market Value per Share on
              the closing or effective date of the Change of Control Event.

          The determination of Stock Option comparability shall be made by the
          Board, and its determination shall be conclusive and binding. In the
          event that an Optionee's Stock Options are assumed or replaced by a
          Successor Corporation in a Change of Control Event, and the Optionee's
          employment or services are terminated within one year after the Change
          of Control Event either by the Successor Corporation without Cause or
          by the Optionee voluntarily for Good Reason, the Optionee shall have
          the right to purchase within ninety (90) days of termination the
          amount of Shares covered by such Stock Options for which the right to
          purchase is scheduled by the terms of the Stock Option Agreement to
          vest within 12 months of the date of termination.

     (c)  If the Company shall be the surviving corporation in any merger or
          consolidation or is a party to a merger or consolidation which does
          not otherwise qualify as a Change of Control Event, any Stock Option
          granted hereunder shall pertain and apply to the securities to which a
          holder of the number of Shares of Common Stock subject to the Stock
          Option would have been entitled.

     (d)  The grant of Stock Options will in no way affect the Company's right
          to adjust, reclassify, reorganize, or otherwise change its capital or
          business structure or to merge, consolidate, dissolve, liquidate or
          sell or transfer all or any part of its business or assets.

     (e)  Nothing herein shall allow the Optionee to purchase Shares, the Stock
          Options for which have expired.

2.6  STOCK OPTION AGREEMENTS; TERMS AND EXPIRATION OF STOCK OPTIONS

<PAGE>

     Each Stock Option granted under this Plan shall be pursuant to a written
     Stock Option Agreement in a form substantially similar to the form attached
     as Annex A, which shall designate whether the Stock Option is an Incentive
     Stock Option or Nonqualified Stock Option, shall be subject to such
     amendment or modification from time to time as the Board shall deem
     necessary or appropriate to comply with or take advantage of applicable
     laws or regulations and shall contain or be subject to provisions as to the
     following effect, together with such other provisions as the Board shall
     from time to time approve:

     (a)  That, subject to the provisions of Section 2.6(b) below, the Stock
          Option, as to the whole or any part thereof, may be exercised only by
          the Optionee or Optionee's personal representative;

     (b)  Except as may be otherwise permitted pursuant to Section 2.13(c) or
          Section 3.3, that neither the whole nor any part of the Stock Option
          shall be transferable by the Optionee or by operation of law other
          than by will of, or by the laws of descent and distribution applicable
          to, a deceased Optionee and that the Stock Option and any and all
          rights granted to the Optionee there under and not theretofore
          effectively and completely exercised shall automatically terminate and
          expire upon any sale, transfer, or hypothecation or any attempted
          sale, transfer, or hypothecation of such rights or upon the bankruptcy
          or insolvency of the Optionee or Optionee's estate;

     (c)  That subject to the foregoing provisions, a Stock Option may be
          exercised at different times for portions of the total number of
          Shares for which the right to purchase shall have vested provided that
          such portions are in multiples of ten (10) shares if the Optionee
          holds vested Stock Options for ninety-nine (99) or fewer Shares and
          otherwise in multiples of one hundred (100) Shares;

     (d)  That no Optionee shall have the right to receive any dividend on or to
          vote or exercise any right in respect to any Shares unless and until
          the certificates for such Shares have been issued to such Optionee;

     (e)  That the Stock Option shall expire with respect to vested Shares at
          the earliest of the following:

          (1)  The date specified in the Stock Option Agreement;

          (2)  With respect to any Employee, ninety (90) days after involuntary
               termination of Optionee's employment for cause;

          (3)  With respect to any Employee, three (3) years after involuntary
               termination of Optionee's employment without cause;

          (4)  With respect to any Employee, ninety (90) days after voluntary
               termination of employment, provided however that the Board or its
               designated Committee may extend the expiration period for any
               such Employee up to three (3) years;

          (5)  With respect to any Consultant, ninety (90) days after the
               earlier of (i) the date either the Company or the Optionee
               notifies the other that the Company or the Optionee, as the case
               may be, is terminating the consultant relationship or (ii) the
               end of a period of one hundred twenty (120) days during which the
               consultant has not performed any service for the Company, unless
               in either case, such termination is on account of death or
               disability;

          (6)  With respect to a Director, ninety (90) days after resignation or
               removal from the Board of the Company or other cessation of
               service as a Director other than on account of death or
               disability; provided however that the Board or its designated
               Committee may extend the expiration period for any such Director
               who resigns up to three (3) years;

          (7)  Twelve (12) months after Optionee's death or disability provided
               that the Board or its designated Committee may extend the
               expiration period for such vested options up to three (3) years;
               or

<PAGE>

          (8)  In the event of a Change of Control Event, or the filing of
               Articles of Dissolution, as the case may be and as described in
               Subsections (1) through (3) of Section 2.5 (a), on the date
               specified in Section 2.5 (a).

     (f)  That, to the extent a Stock Option Agreement provides for the vesting
          of the right to purchase in increments, such vesting shall cease as of
          the date of the Optionee's death, Disability, or, in the case of any
          Employee, voluntary or involuntary termination of Optionee's
          employment with the Company for any reason or, in the case of any
          Consultant, (i) the date either the Company or Optionee notifies the
          other that the Company or the Optionee, as the case may be, is
          terminating the consultant relationship or (ii) the end of a period of
          one hundred twenty (120) days during which the Consultant has not
          performed any service for the Company or, in the case of a Director,
          upon his resignation or removal from the Board of the Company or other
          cessation of his services as a director;

     (g)  That the time at which or the installments in which the Stock Option
          shall become exercisable, is as set forth in the Stock Option
          Agreement; provided that if not set forth in the Stock Option
          Agreement, the Stock Option will become exercisable according to the
          following schedule, which may be waived or modified by the Board or
          its designated Committee at any time:
<TABLE>
<CAPTION>

          ------------------------------------------------------------    -----------------------
<S>                                                                       <C>
          Period of Optionee's Continuous Employment or Service With      Percent of Total Option
          the Company or Its Subsidiaries From the Date                     That is Exercisable
          Option is Granted
          ------------------------------------------------------------    -----------------------
          After 12 months                                                 33.3%
          ------------------------------------------------------------    -----------------------
          Each month period of continuous service completed thereafter    An additional 2.7792%
          ------------------------------------------------------------    -----------------------
          After 3 years                                                   100%
          ------------------------------------------------------------    -----------------------
</TABLE>

          If, in the absence of this provision, a Stock Option would become
          exercisable for a fractional share under the terms and conditions
          governing its exercisability, then the Stock Option shall instead
          become exercisable for such fractional share at the time provided in
          the Stock Option Agreement for such Stock Option to become fully
          exercisable.

     (h)  That the terms of the Stock Option Agreement shall be a contract
          between the Company and the Optionee and the specific terms of any
          Stock Option Agreement shall govern over the more general terms
          hereof; and

     (i)  With respect to Employees, subject to the Plan Guidelines, the Stock
          Option Agreement shall not be affected by any changes of duties or
          position so long as the Optionee shall continue to be an Employee,
          subject to the terms hereof.

2.7  RULE 16B-3 COMPLIANCE

     (a)  Unless an Optionee could otherwise exercise a Stock Option or dispose
          of Shares delivered upon exercise of a Stock Option granted under the
          Plan without incurring liability under Section 16 of the Exchange Act
          ("Section 16"), at least six months shall elapse from the date of
          acquisition of the Stock Option to the date of disposition of its
          underlying Shares.

     (b)  It is the intent of the Company that this Plan comply in all respects
          with applicable provisions of Rule 16b-3 or Rule 15a-1(c)(3) under the
          Exchange Act in connection with any grant of Stock Options to or other
          transaction by an Optionee who is subject to Section 16 (except for
          transactions exempted under alternative Exchange Act Rules or
          acknowledged in writing to be non-exempt by such Optionee).
          Accordingly, if any provision of this Plan or any Stock Option
          Agreement relating to a Stock Option does not comply with the
          requirements of Rule 16b-3 or Rule 16a-1(c)(3) as then applicable to
          such transaction, such provision will be construed or deemed amended
          to the extent necessary to conform to the applicable requirements of
          Rule 16b-3 or Rule 16a-1(c)(3) so that such Optionee shall avoid
          liability under Section 16(b).

<PAGE>

2.8  NOTICE OF INTENT TO EXERCISE STOCK OPTION

     The Optionee (or other person or persons, if any, entitled hereunder)
     desiring to exercise a Stock Option as to all or part of the Shares covered
     thereby shall in writing notify the Company at its principal office,
     specifying the number of Shares to be purchased and, if required by the
     Company, representing in form satisfactory to the Company that the Shares
     are being purchased for investment and not with a view to resale or
     distribution. The Company from time to time may issue or specify to
     Optionees a written form for use in connection with any such exercise. With
     respect to any Shares conditionally purchased pursuant to Section 2.5(a)
     above and for which such purchase has not been voluntarily or otherwise
     rescinded pursuant to Section 2.5(a), the Optionee shall be deemed to have
     given to the Company the notice of exercise required by this Section 2.8 as
     of ten (10) days prior to the closing or effective date of the Change of
     Control Event or the filing of Articles of Dissolution, as the case may be
     and as described in Subsections (1) through (3) of Section 2.5(a).

2.9  METHOD OF EXERCISE OF STOCK OPTION

     Within ten (10) days after receipt by the Company of the notice provided in
     Section 2.8, but not later than the expiration date specified in Section
     2.5(e), the Stock Option shall be exercised as to the number of Shares
     specified in the notice by payment by the Optionee to the Company of the
     amount specified below in Section 3.2 and Section 4.5, as applicable.
     Payment of such purchase price shall be made in cash, or in accordance with
     procedures for a "cashless exercise" as the same may have been established
     from time to time by the Company to facilitate exercises of Stock Options
     and sales of Shares under this Plan. The Company has no obligation and has
     made no commitments to establish a procedure for "cashless exercise".
     Payment in shares of the Company's Common Stock shall be deemed to be the
     equivalent of payment in cash at the Fair Market Value of those shares. For
     purposes of the preceding sentence, "Fair Market Value" shall be determined
     by the Board in the same manner as utilized in determining the Fair Market
     Value at the time other Stock Options are granted.

2.10 RECAPITALIZATION

     The aggregate number of Shares for which Stock Options may be granted
     hereunder, the number of Shares covered by each outstanding Stock Option
     and the price per Share thereof in each such Stock Option Agreement shall
     be proportionately adjusted for an increase or decrease in the number of
     outstanding shares of common stock of the Company resulting from a stock
     split or reverse split of shares or any other capital adjustment or the
     payment of a stock dividend or other increase or decrease in such shares
     effected without receipt of consideration by the Company excluding any
     decrease resulting from a redemption of shares by the Company. If the
     adjustment would result in a fractional Share the Optionee shall be
     entitled to one (1) additional Share, provided that the total number of
     Shares to be granted under this Plan shall not be increased above the
     equivalent number of Shares initially allocated or later increased by
     approved amendment to this Plan. Any adjustment shall be made by the Board
     whose determination shall be final, binding and conclusive.

     If the Company's Common Stock is reclassified or converted into common
     stock or another class of common stock in accordance with the Company's
     Articles of Incorporation or otherwise, any then outstanding Stock Options
     shall automatically become options to purchase shares of stock of the
     Company into which the Common Stock is converted or reclassified; and all
     references to "Shares" herein shall refer to shares of the Company's stock
     into which the Common Stock is converted or reclassified.

2.11 SUBSTITUTIONS AND ASSUMPTIONS

     The Board shall have the right to substitute, replace, or assume options in
     connection with mergers, reorganizations, separations, or other "corporate
     transactions" as that term is defined in and said substitutions and
     assumptions are permitted by Section 425 of the Code and the regulations

<PAGE>

     promulgated there under. The number of Shares reserved pursuant to Section
     2.2 may be increased by the corresponding number of options assumed and, in
     the case of a substitution, by the net increase in the number of Shares
     subject to options before and after the substitution.

2.12 TERMINAL DATE OF PLAN

     This Plan shall not extend beyond a date ten (10) years from the date of
     adoption hereof by the Board, provided that any Stock Option to purchase
     shares duly granted hereunder prior to such date shall be exercisable
     pursuant to its terms and the terms hereof until expiration or earlier
     termination of such Stock Option.

2.13 GRANTING OF STOCK OPTIONS

     (a)  The granting of any Stock Option pursuant to this Plan shall be
          entirely in the discretion of the Board and nothing herein contained
          shall be construed to give any person any right to participate under
          this Plan or to receive any Stock Option under it.

     (b)  The granting of a Stock Option pursuant to this Plan shall not
          constitute any agreement or an understanding, express or implied on
          the part of the Company or a current or future subsidiary to employ or
          retain the Optionee for any specified period.

     (c)  The Board shall have the authority to grant both transferable Stock
          Options and nontransferable Stock Options and to amend outstanding
          nontransferable Stock Options to provide for transferability. Each
          Stock Option intended to qualify as an Incentive Stock Option and each
          nontransferable Stock Option intended to qualify under Rule 16b-3 or
          otherwise shall provide by its terms that it is not transferable
          otherwise than by will or the laws of descent and distribution or,
          except in the case of Incentive Stock Options, pursuant to a
          "qualified domestic relations order" as defined by the Code and is
          exercisable, during the Optionee's lifetime, only by the Optionee.
          Each transferable Stock Option may provide for such limitations on
          transferability and exercisability as the Board may designate at the
          time the Stock Option is granted or is otherwise amended to provide
          for transferability.

2.14 WITHDRAWAL

     An Optionee may at any time elect in writing to abandon a Stock Option with
     respect to the number of Shares as to which the Stock Option shall not have
     been exercised.

2.15 GOVERNMENT REGULATIONS

     This Plan and the granting and exercise of any Stock Option hereunder and
     the obligations of the Company to sell and deliver Shares under any such
     Stock Option shall be subject to all applicable laws, rules and regulations
     and to such approvals by any governmental agencies as may be required.

2.16 PROCEEDS FROM SALE OF STOCK

     Proceeds of the purchase of Shares by an Optionee shall be used for the
     general business purposes of the Company.

2.17 SHAREHOLDER APPROVAL

     This Plan shall be submitted to the shareholders for their approval within
     twelve (12) months from the date hereof. The Company may grant Stock
     Options prior to such approval which shall be conditioned upon subsequent
     shareholder approval.

<PAGE>

2.18 COMPLIANCE WITH SECURITIES LAWS

     The Board shall have the right to:

     (a)  Require an Optionee to execute, as a condition of exercise of a Stock
          Option, a letter evidencing Optionee's intent to acquire the Shares
          for investment and not with a view to the resale or distribution
          thereof;

     (b)  Place appropriate legends upon the certificate or certificates for the
          Shares; and

     (c)  Take such other acts as it deems necessary in order to cause the
          issuance of Shares to comply with applicable provisions of state and
          federal securities laws.

     In furtherance of the foregoing and not by way of limitation thereof, no
     Stock Option shall be exercisable unless such Stock Option and the Shares
     to be issued pursuant thereto shall be registered under appropriate federal
     and state securities laws, or shall be exempt therefrom, in the opinion of
     the Board upon advice of counsel to the Company. Each Stock Option
     Agreement shall contain adequate provisions to assure that there will be no
     violation of such laws. This provision shall in no way obligate the Company
     to undertake registration of Stock Options or Shares hereunder. Issue,
     transfer or delivery of certificates for Shares pursuant to the exercise of
     Stock Options may be delayed, at the discretion of the Board until the
     Board is satisfied that the applicable requirements of the federal and
     state securities laws have been met.

     The dollar value and number of Stock Options granted under this Plan are
     limited pursuant to Rule 701 promulgated by the Securities and Exchange
     Commission, which provides an exemption from the registration requirements
     under the Act. Any guidelines adopted pursuant to this Plan shall contain
     the current limitations specified in said Rule 701 until the Company is
     registered under the Act.

2.19 GOLDEN PARACHUTE TAXES

     In the event that any amounts paid or deemed paid to an employee under this
     Plan are deemed to constitute "excess parachute payments" as defined in
     Section 280G of the Code (taking into account any other payments made under
     this Plan and any other compensation paid or deemed paid to an employee),
     or if any employee is deemed to receive an "excess parachute payment" by
     reason of his or her vesting of Options pursuant to Section 2.5 herein, the
     amount of such payments or deemed payments shall be reduced (or,
     alternatively the provisions of Section 2.5 shall not act to vest options
     to such employee), so that no such payments or deemed payments shall
     constitute excess parachute payments. The determination of whether a
     payment or deemed payment constitutes an excess parachute payment shall be
     in the sole discretion of the Board.

3. PROVISIONS APPLICABLE SOLELY TO NONQUALIFIED STOCK OPTIONS

     In addition to the provisions of Section 2 above, the following paragraphs
     shall apply to any Stock Options granted under this Plan which are not
     Incentive Stock Options.

3.1  OPTION PRICE

     The option, or purchase, price of each Share optioned as a Nonqualified
     Stock Option under this Plan shall be determined by the Board and set forth
     in the Stock Option Agreement.

3.2  METHOD OF EXERCISE OF STOCK OPTION

     The amount to be paid by the Optionee upon exercise of a Nonqualified Stock
     Option shall be the exercise price provided for in the Stock Option
     Agreement, together with the amount of federal, state and local income and
     FICA taxes required to be withheld by the Company. If the Company has
     established procedures for a "cashless exercise" pursuant to Section 2.9,
     an Optionee may elect to pay Optionee's federal, state, or local income and
     FICA withholding tax by having the Company withhold shares of Company
     Common Stock having a value equal to the amount required to be withheld.
     The value of the shares to be withheld is deemed to equal the Fair Market
     Value of the shares on the day the Stock Option is exercised. An election
     by an Optionee to have shares withheld for this purpose will be subject to
     the following restrictions:

<PAGE>

     (a) If an Optionee has received multiple Stock Option grants, a separate
         election must be made for each grant;

     (b) The election must be made prior to the day the Stock Option is
         exercised;

     (c) The election will be irrevocable;

     (d) The election will be subject to the disapproval of the Board; and

     (e) If the Optionee is an "officer" of the Company within the meaning of
         Section 16 as defined in Rule 16a-1 promulgated by the Securities and
         Exchange Commission, the election may not be made within six (6) months
         following the grant of the Stock Option.

3.3  ASSIGNMENT

     The Company may allow limited assignment rights for the gifting by Optionee
     of rights hereunder to vested Nonqualified Stock Options, on terms to be
     determined by the Board from time to time.

4. PROVISIONS APPLICABLE SOLELY TO INCENTIVE STOCK OPTIONS

     In addition to the provisions of Section 2 above, the following paragraphs
     shall apply to any Stock Options granted under this Plan which are
     Incentive Stock Options.

4.1  CONFORMANCE WITH INTERNAL REVENUE CODE

     Stock Options granted under this Plan which are "Incentive Stock Options"
     shall conform to, be governed by and be interpreted in accordance with
     Section 422 of the Code and any regulations promulgated thereunder and
     amendments to the Code and regulations. Only Employees may be granted
     Incentive Stock Options hereunder--Consultants and non-employee Directors
     may not receive Incentive Stock Options hereunder.

4.2  OPTION PRICE

     The option, or purchase, price of each Share optioned as an Incentive Stock
     Option under this Plan shall be determined by the Board at the time of the
     action for the granting of the Stock Option and set forth in the Stock
     Option Agreement, but shall not, in any event, be less than the Fair Market
     Value of the Company's Common Stock on the date of grant.

4.3  LIMITATION ON AMOUNT OF INCENTIVE STOCK OPTION

     The aggregate Fair Market Value of the Shares, as determined on the date of
     grant, vesting in any one calendar year with respect to which an Employee
     has the right to purchase (under this Plan or any other plan of the Company
     which authorizes Incentive Stock Options) shall not exceed $100,000; and to
     the extent any Stock Option purporting to be an Incentive Stock Option
     grants an Employee the right to purchase Shares with an aggregate Fair
     Market Value vesting in any one calendar year in excess of $100,000, as so
     determined (under this Plan or any other plan of the Company which
     authorizes Incentive Stock Options), shall be deemed a Nonqualified Stock
     Option for such excess amount.

4.4  LIMITATION ON GRANTS TO SUBSTANTIAL SHAREHOLDERS

<PAGE>

     It is the Company's intent that it will not grant Incentive Stock Options
     to any Employee who, immediately prior to the grant of a Stock Option
     hereunder, owns stock in the Company representing more than ten percent
     (10%) of the voting power of all classes of stock of the Company, unless
     the per share option price specified by the Board for the Incentive Stock
     Options granted such an Employee is at least one hundred ten percent (110%)
     of the Fair Market Value of the Company's stock on the date of grant and
     such Stock Option, by its terms, is not exercisable after the expiration of
     five (5) years from the date such Stock Option is granted. Any Stock Option
     that by its terms purports to be an Incentive Stock Option that is issued
     to an Employee who owns stock in the Company representing more than ten
     percent (10%) of the voting power of all classes of stock of the Company
     that does not have an exercise price of at least one hundred ten percent
     (110%) of the Fair Market Value of the Company's stock on the date of grant
     or that is, by its terms, exercisable after the expiration of five (5)
     years from the date such Stock Option is granted, shall be deemed a
     Nonqualified Stock Option.

4.5  METHOD OF EXERCISE OF STOCK OPTION

     The amount to be paid by the Optionee upon exercise of an Incentive Stock
     Option shall be the purchase price per share provided for in the Stock
     Option Agreement.

5.   COMPANY'S OPTION TO REPURCHASE

5.1  OPTION TO REPURCHASE

     Subject to the provisions of Section 5.3 below and unless otherwise
     specified by the Board, upon the termination of an Optionee's employment or
     business relationship with the Company or any current or future subsidiary,
     the Company shall have the right to repurchase up to Ten Thousand (10,000)
     Shares purchased upon the exercise of Stock Options (and any other shares
     of stock or other securities issued in connection with such Shares) granted
     while the Optionee was an Employee, Consultant or Director of the Company
     or a current or future subsidiary, as the case may be, at its then-current
     Fair Market Value, as determined by the Board. The Company shall give
     written notice to the Optionee of its intention to repurchase within the
     later of (i) sixty (60) days after the date of termination or (ii) sixty
     (60) days after the last day a Stock Option held by such Optionee might be
     exercised. The purchase price for the Shares to be repurchased shall be
     payable in cash within sixty (60) days after the notice is given and shall
     be offset against any amounts that may be due and owing to the Company. For
     purposes of this Section 5.1, "Fair Market Value" shall be determined by
     the Board in the same manner as utilized in determining the Fair Market
     Value for purposes of Stock Option grants at such time. The Board's
     determination of Fair Market Value shall be final.

5.2  RIGHT OF FIRST REFUSAL

     Subject to the provisions of Section 5.3 below and unless otherwise
     specified by the Board, the Optionee (or his personal representative) shall
     not sell or encumber the Shares purchased hereunder or any other shares
     issued in connection with those Shares, unless he or she has first offered
     to sell such Shares to the Company, as follows: If the Optionee proposes to
     encumber or transfer such Shares, he or she shall advise the Company of the
     name of the proposed recipient, the number and class of Shares and the
     proposed price and terms. The Company shall have an option, which option
     must be exercised in writing within forty-five (45) days after receipt of
     written notice of the proposed transfer, to purchase such Shares upon the
     same terms and conditions as are stated in the notice. The purchase price
     shall be paid by the Company within forty-five (45) days of the giving of
     its notice of intent to repurchase. In the event the Company does not elect
     to repurchase hereunder, the Optionee shall have the right to encumber or
     transfer such Shares in accordance with the price and terms and to the
     recipient stated in the notice for a period of ninety (90) days; but, if
     such Shares are not encumbered or transferred within said ninety (90) days,
     the Optionee shall not thereafter encumber or transfer such Shares without
     again complying with the requirements of this Section 5.2. By executing the
     appropriate acknowledgment on Stock Option Agreements, the spouses of
     Optionees shall agree and assent to the repurchase rights set forth in
     Sections 5.1 and 5.2. The Company may require spouses of Optionees to
     execute similar acknowledgments in connection with the exercise of Stock
     Options. Notwithstanding the foregoing restrictions in this Section 5.2, an
     Optionee (the "Transferor") may, during his or her lifetime, give or
     otherwise transfer, outright or in trust, any or all of his or her Shares

<PAGE>

     to one or more of the following persons: his or her spouse, his or her
     lineal ancestors, or descendants, or to an entity owned and controlled by
     such Optionee (the "Permitted Transferees"); provided that (i) each
     Permitted Transferee holds such Shares subject to the terms and conditions
     of this Section 5.2 and signs an agreement to that effect, and (ii) each
     Permitted Transferee makes no further transfer of any Shares, voluntarily
     or otherwise, except to the Transferor or to the Transferor's other
     Permitted Transferees.

5.3  TERMINATION OF COMPANY'S RIGHTS

     The Company's repurchase rights stated in Sections 5.1 and 5.2 above will
     terminate in the event the Company successfully concludes a registered
     public offering of its common stock under the Act.

6.   TERMINATION AND AMENDMENT

     This Plan, the Plan Guidelines and all rules and regulations adopted in
     respect hereof may be terminated, suspended, or amended at any time by a
     majority vote of the Board, provided that no such action shall adversely
     affect any material rights of Optionees granted under this Plan prior to
     such action without the consent of such Optionees and provided further that
     to the extent required for compliance with Section 422 of the Code or any
     applicable law or regulation, shareholder approval will be required for any
     amendment that will (a) increase the total number of shares as to which
     Options may be granted under the Plan, (b) modify the class of persons
     eligible to receive Options, or (c) otherwise require shareholder approval
     under any applicable law or regulation. The Board may amend the terms and
     conditions of outstanding Stock Options, provided, however, that (i) no
     such amendment would be materially adverse to the holders of such Stock
     Options without their consent, (ii) no such amendment shall extend the
     period for exercise of a Stock Option, and (iii) the amended terms of a
     Stock Option would be permitted under this Plan. Any change or adjustment
     to an outstanding Incentive Stock Option shall not, without the consent of
     the Optionee, be made in a manner so as to constitute a "modification" that
     would cause such Incentive Stock Option to fail to continue to qualify as
     an Incentive Stock Option.

7.   FOREIGN EMPLOYEES

     Without amending this Plan, the Board may grant Stock Options to eligible
     Employees who are foreign nationals on such terms and conditions different
     from those specified in this Plan as may in the judgment of the Board be
     necessary or desirable to foster and promote achievement of the purposes of
     this Plan, and, in furtherance of such purposes the Board may make such
     modifications, amendments, procedures, subplans, and the like as may be
     necessary or advisable to comply with the provisions of the laws in other
     countries in which the Company operates or has Employees.

8.   REGISTRATION, LISTING AND QUALIFICATION OF SHARES

     Each Stock Option shall be subject to the requirement that if at any time
     the Board shall determine that the registration, listing, or qualification
     of the Shares covered thereby upon any securities exchange or under any
     foreign, federal, state, or local law, or the consent or approval of any
     governmental regulatory body, is necessary or desirable as a condition of,
     or in connection with, the granting of such Stock Option or the purchase of
     shares thereunder, no such Stock Option may be exercised unless and until
     such registration, listing, qualification, consent, or approval shall have
     been effected or obtained free of any condition not acceptable to the
     Board. Any person exercising a Stock Option shall make such representations
     and agreements and furnish such information as the Board may request to
     assure compliance with the foregoing or any other applicable legal
     requirements.

9.   NO RIGHTS TO STOCK OPTIONS OR EMPLOYMENT; NO RESTRICTIONS

     No Employee or other person shall have any claim or right to be granted a
     Stock Option under this Plan. Having received a Stock Option under this
     Plan shall not give an Employee or other person any right to receive any
     other grant or Stock Option under this Plan. An Optionee shall have no
     rights to or interest in any Stock Option except as set forth herein.
     Neither this Plan nor any action taken hereunder shall be construed as
     giving any

<PAGE>

     Employee any right to be retained in the employ of the Company or any
     Consultant or Director any right to be retained or engaged by the Company,
     or otherwise in any way affect any right and power of the Company to
     terminate the employment or engagement of any Employee, Consultant or
     Director at any time with or without assigning a reason therefor. Nothing
     in this Plan shall restrict the Company's rights to adopt other option
     plans pertaining to any or all of the Employees, Consultants or Directors
     covered under this Plan or other Employees, Consultants or Directors not
     covered under this Plan.

     Each Stock Option granted hereunder may be affected, with regard to both
     vesting schedule and termination, by leaves of absence, a reduction in the
     number of hours worked, partial disability and other changes in Optionee's
     Employee, Consultant or Director status, as the case may be. The Company's
     policies in such matters shall be contained in the Plan Guidelines adopted
     by the Board. The Plan Guidelines and the guidelines, rules, policies and
     regulations contained therein may be amended at any time and from time to
     time by the Board or the Committee, in its sole discretion and with or
     without notice. Optionee's rights hereunder or under any Stock Option
     granted hereunder at any time shall be governed by the Plan Guidelines in
     effect at the time of any change in Optionee's employment status as
     contemplated above.

10. COSTS AND EXPENSES

     Except as provided herein with respect to the payment of taxes, all costs
     and expenses of administering this Plan shall be borne by the Company and
     shall not be charged to any grant or any Optionee receiving a grant.

11. PLAN UNFUNDED

     This Plan shall be unfunded. Except for the Board's reservation of a
     sufficient number of authorized shares to the extent required by law to
     meet the requirements of this Plan, the Company shall not be required to
     establish any special or separate fund or to make any other segregation of
     assets to assure payment of any grant under this Plan.

12. GOVERNING LAW

     This Plan shall be governed by and construed in accordance with the laws of
     the State of Delaware (without regard to the legislative or judicial
     conflict of laws rules of any state), except to the extent superseded by
     federal law, and venue for any action taken in connection herewith or
     related hereto shall exclusively reside in King County, Washington.

13. SPECIAL PROVISIONS RELATING TO CALIFORNIA RESIDENTS

     Notwithstanding anything to the contrary herein, the following provisions
     shall govern all options granted under the Plan to residents of the State
     of California (referred to herein as "California Options"). The following
     provisions are intended to comply with Rule 260.140.41 of the Regulations
     of the Department of Corporations of the State of California (the
     "California Regulations"). When issuing California options, the Company
     shall indicate on the options that they are issued subject to these special
     provisions.

     (a)  The total number of shares granted pursuant to the Plan is as set
          forth in Section 2.2 of the Plan.

     (b)  The option price or purchase price of each Share optioned under the
          Plan under a California Option shall be determined by the Board at the
          time of the action for the granting of the option but shall not, in
          any event, be less than eighty-five percent (85%) of the Fair Market
          Value of the Common Stock on the date of grant. With respect to any
          California Option granted to any person who owns stock possessing more
          than ten percent (10%) of the total combined voting power or value of
          all classes of stock of the Company, the option price shall be at
          least one hundred ten percent (110%) of the Fair Market Value of the
          Common Stock on the date of grant.

<PAGE>

     (c)  The exercise period with respect to California Options shall not
          exceed one hundred twenty (120) months from the date of grant.

     (d)  California Options shall not be transferable other than by will or the
          laws of descent and distribution, by instrument to an inter vivos or
          testamentary trust in which the options are to be passed to
          beneficiaries upon the death of the trustor (settlor), or by gift to
          "immediate family" as that term is defined in 17 C.F.R. 240.16a-1(e).

     (e)  In the event of a stock split, reverse stock split, stock dividend,
          recapitalization, combination or reclassification of the Company's
          stock, the number of shares subject to a California Option shall be
          adjusted in accordance with the provision of Section 2.9 of the Plan.

     (f)  California Options shall, at a minimum, be exercisable at a rate of
          twenty percent (20%) per year from the date of grant.

     (g)  Unless employment is terminated for cause as defined by applicable
          law, the terms of the Plan or option grant or a contract of
          employment, the right to exercise a California Option in the event of
          termination of employment with the Company, to the extent that the
          California Option is exercisable on the date of such termination of
          employment, is as follows: at least six (6) months from the date of
          termination if termination was caused by death or disability and at
          least thirty (30) days from the date of termination if termination was
          caused by other than death or disability.

     (h)  There shall be no California Options granted under the Plan later than
          ten (10) years from the date the Plan was adopted or the date the Plan
          is approved by the shareholders, whichever is earlier.

     (i)  The Plan shall be approved by the shareholders within twelve (12)
          months after the date of adoption of the Plan by the Board of
          Directors. No option may be exercised before shareholder approval is
          obtained.

     (j)  The Company will comply with Section 260.140.46 of the California Code
          of Regulations regarding information required to be received by
          employees of the Company residing in the State of California.

     The provisions of Section 2.5(a) and (b) and paragraph (7) of subsection
     (e) of Section 2.6 of the Plan shall not apply to California Options with
     the effect that there shall be no reference in the Plan to the acceleration
     of the exercise period for California Options in relation to mergers,
     consolidations and takeovers in which the Company is not the surviving
     entity.

14.  SEVERABILITY

     In the event any provision of this Plan or any Stock Option Agreement is
     found to be invalid or unenforceable, such provision shall be deemed
     reformed to the extent necessary to render it valid and enforceable. The
     invalidity or unenforceability of any provision in this Plan or any Stock
     Option Agreement shall not in any way affect the validity or enforceability
     of any other provision of this Plan or the Stock Option Agreement, as the
     case may be and this Plan and the Stock Option Agreement shall be construed
     in all respects as if such invalid or unenforceable provision had never
     been included.

<PAGE>

                                     ANNEX A

                             Stock Option No. ______

                                    [FORM OF]
                      HELIX BIOMEDIX, INC. (THE "COMPANY")
                  STOCK OPTION AGREEMENT FOR PURCHASE OF STOCK

We are pleased to inform you that the Company has granted to you, as the
individual named below (the "Optionee"), this Stock Option. This Stock Option
Agreement is a contract between you and the Company. It grants to you certain
defined rights, at certain times and under certain conditions, to purchase
shares of the Company's Common Stock, and in exchange you accept certain
obligations and responsibilities, as described below and in the Company's 2000
Stock Option Plan (adopted __________ __, ____) (the "Plan") and the attached
Terms and Conditions.

FOR VALUABLE CONSIDERATION, the Company does hereby grant to the Optionee, as of
the Date of Option Grant specified below, the right and option to purchase the
number of shares of Common Stock of the Company specified below (the "Option
Shares") for the Exercise Price Per Share specified below, and the right to
purchase the Option Shares under this Stock Option Agreement shall accrue and
vest according to the Vesting Schedule specified below:



--------------------------------------------------------------------------------
NAME OF OPTIONEE:
--------------------------------------------------------------------------------
TYPE OF OPTION:
--------------------------------------------------------------------------------
NUMBER OF OPTION SHARES:
--------------------------------------------------------------------------------
EXERCISE PRICE PER SHARE:
--------------------------------------------------------------------------------
DATE OF OPTION GRANT:
--------------------------------------------------------------------------------
TERM OF OPTION:
--------------------------------------------------------------------------------
VESTING SCHEDULE:
--------------------------------------------------------------------------------



                    EXECUTED as of the Date of Option Grant.

                              HELIX BIOMEDIX, INC.

                                       By:

Its:

<PAGE>


BY SIGNING BELOW AND ENTERING INTO THIS STOCK OPTION AGREEMENT, OPTIONEE AGREES
TO THE TERMS HEREOF AND ALL OBLIGATIONS AND RESPONSIBILITIES AS DESCRIBED IN THE
PLAN AND THE ATTACHED TERMS AND CONDITIONS.

                                    OPTIONEE
                                  , as Optionee

BY SIGNING BELOW, OPTIONEE'S SPOUSE HEREBY ACKNOWLEDGES THAT, PURSUANT TO THE
PLAN THE COMPANY WILL HAVE CERTAIN REPURCHASE RIGHTS WITH RESPECT TO ANY OPTION
SHARES ISSUED TO OPTIONEE UPON EXERCISE OF THIS STOCK OPTION AND AS A CONDITION
TO SUCH EXERCISE, THE UNDERSIGNED WILL EXECUTE SUCH DOCUMENTATION AS MAY BE
REASONABLY REQUIRED BY THE COMPANY EVIDENCING THE UNDERSIGNED'S ACCEPTANCE OF
AND AGREEMENT TO SUCH REPURCHASE RIGHTS.

                                     SPOUSE
                                   , as Spouse

                                       15


<PAGE>



                 TERMS AND CONDITIONS OF STOCK OPTION AGREEMENT

            STOCK OPTIONS ARE SUBJECT TO THE TERMS HEREOF AND OF THE
   COMPANY'S 2000 STOCK OPTION PLAN (ADOPTED ________ __, ____) (THE "PLAN").
                   CAPITALIZED TERMS USED IN THIS STOCK OPTION
                      AGREEMENT (THIS "AGREEMENT"), IF NOT
                      OTHERWISE DEFINED, HAVE THE MEANINGS
                             GIVEN THEM IN THE PLAN.

1.        (a) Any Option Shares which become purchasable ("vest") but are not
          purchased on a vesting date or anniversary date, as the case may be,
          may be purchased on any subsequent date, provided all options for the
          purchase of Option Shares must be exercised within the time periods
          specified in Section 2 below.

     (b) Optionees shall have conditional purchase rights in the event of any
         Change of Control Event or dissolution as described in the Plan.

2.   All UNVESTED options shall expire upon any termination of Optionee's
     employment with or provision of services to the Company for any reason,
     whether voluntary or involuntary, or upon the death or Disability of
     Optionee, as more fully described in the Plan.

     Subject to the terms hereof, all VESTED options (i.e., options for which
     the right to purchase has accrued) shall expire at the earliest of the
     following:

     (a)  The earlier of the end of the Term of Option specified on the first
          page of this Agreement or ten (10) years from the Date of Option Grant
          specified on the first page of this Agreement;

     (b)  If Optionee is or becomes an Employee, ninety (90) days after
          voluntary or involuntary termination of Optionee's employment other
          than termination as described in Paragraphs (e) or (f) below;

     (c)  If Optionee is or becomes a Consultant, ninety (90) days after the
          earlier of (i) the date either the Company or Optionee notifies the
          other that the Company or the Optionee, as the case may be, is
          terminating the consultant relationship or (ii) the end of a period of
          one hundred twenty (120) days during which the Consultant has not
          performed any service for the Company, unless in either case, such
          termination is pursuant to events described in Paragraphs (e) or (f)
          below;

     (d)  If Optionee is a Director, ninety (90) days after resignation or
          removal from the Board of the Company or other cessation of service as
          a director other than cessation of service as described in Paragraphs
          (e) or (f) below;

     (e)  Upon discharge of Optionee (removal from the Board, in the case of a
          Director) for "cause" as defined in any employment or consulting
          agreement between the Company and Optionee or, if there shall be no
          such employment or consulting agreement, for Cause, as defined in the
          Plan;

     (f)  Twelve (12) months after Optionee's death or Disability; or

     (g)  In the event of a Change of Control Event or dissolution as described
          in the Plan. However, if the Change of Control Event or dissolution,
          as the case may be and as described in the Plan, is not finalized, all
          options which are terminated pursuant to this Subsection (g) shall be
          reinstated as described in the Plan.

     Optionee agrees that all vested and unvested options granted pursuant to
     this Stock Option shall expire in accordance with the provisions of this
     paragraph 2 following involuntary or voluntary termination of Optionee's
     employment with, engagement by or services to the Company, as applicable,
     for any reason. Optionee hereby waives the right to recover as damages any
     vested or unvested stock options which expire according to this paragraph
     2. This waiver shall include, but not be limited to, damages related to any
     claims Optionee may have against the Company to which Optionee may be
     entitled by virtue of employment with the Company or the termination of
     Optionee's employment.


<PAGE>

3.   This Stock Option may be exercised at different times for portions of the
     total number of Option Shares for which the right to purchase shall have
     accrued and vested hereunder, provided that such portions are in multiples
     of ten (10) shares if the Optionee holds vested portions for ninety-nine
     (99) or fewer shares and otherwise in multiples of one hundred (100)
     shares.

4.   This Stock Option shall be adjusted for recapitalization, stock splits,
     stock dividends and the like as described in the Plan.

5.   This is not an employment contract and while the benefits, if any, of this
     Stock Option may be an incident of the Optionee's employment with or
     provision of services to the Company, the terms and conditions of such
     employment or provision of services are otherwise wholly independent
     hereof.

6.   Neither this Stock Option nor any right under this Agreement is assignable
     and rights under this Agreement may be exercised only by the Optionee or a
     person to whom the rights under this Agreement shall pass by will or the
     laws of descent and distribution.

7.   The Optionee shall indicate Optionee's intention to exercise this Stock
     Option with respect to vested Option Shares by notifying the Company in
     writing of such intention in the form of the Notice of Exercise attached
     hereto as Exhibit A, indicating the number of Option Shares Optionee
     intends to purchase and, within ten (10) days thereafter, paying to the
     Company an amount sufficient to cover the total option price of such Option
     Shares together with the amount of federal, state and local income and FICA
     taxes required to be withheld by the Company, if any, as provided in the
     Plan. Payment of the Exercise Price Per Share specified on the first page
     of this Agreement shall be made in cash or in accordance with such
     procedures for a "cashless exercise" as may be established from time to
     time by the Company to facilitate exercises of Stock Options and sales of
     Option Shares under the Plan.

8.   If the Optionee, immediately prior to the grant of an Incentive Stock
     Option hereunder, owns stock in the Company representing more than ten
     percent (10%) of the voting power of all classes of stock of the Company,
     the Exercise Price Per Share specified on the first page of this Agreement
     for Incentive Stock Options granted hereunder shall be not less than one
     hundred ten percent (110%) of the Fair Market Value of the Company's Common
     Stock on the Date of Option Grant specified on the first page of this
     Agreement and such Incentive Stock Option shall not be exercisable after
     the expiration of five (5) years from said Date of Option Grant and
     notwithstanding any pricing or vesting terms hereof which appear at
     variance with the foregoing, all pricing and vesting terms hereof shall be
     deemed hereby to conform with the foregoing limitations. In lieu of the
     foregoing, the Optionee may elect to have a Stock Option that purports to
     be an Incentive Stock Option treated as a Non-Qualified Stock Option
     pursuant to the original terms of this Agreement.

9.   Notwithstanding the foregoing, no Stock Option shall be exercisable and
     rights under this Agreement are not enforceable, unless and until all
     requirements imposed by or pursuant to Section 2.18 of the Plan are
     satisfied.

SECTION 2.18 OF THE PLAN DESCRIBES CERTAIN IMPORTANT CONDITIONS RELATING TO
FEDERAL AND STATE SECURITIES LAWS THAT MUST BE SATISFIED BEFORE THIS OPTION CAN
BE EXERCISED AND BEFORE THE COMPANY CAN ISSUE ANY OPTION SHARES TO THE OPTIONEE.
AT THE PRESENT TIME THE PLAN IS NOT REGISTERED AND, ALTHOUGH SHARES MAY BE
ISSUED UPON EXERCISE, THE SHARES SO ISSUED ARE NOT FREELY TRADABLE.


<PAGE>

THERE CAN BE NO ASSURANCE THAT THE EXEMPTION(S) ALLOWING ISSUANCE OF THE SHARES
UPON EXERCISE WILL REMAIN AVAILABLE, NOR IS THERE ASSURANCE THAT ISSUED SHARES
WILL BE REGISTERED OR THAT ONCE REGISTERED THE REGISTRATION WILL BE MAINTAINED.
IF THE SHARES ARE NOT REGISTERED OR IF THE REGISTRATION IS NOT MAINTAINED, THE
OPTIONEE WILL NOT BE ABLE TO TRADE SHARES OBTAINED UPON EXERCISE OF THIS STOCK
OPTION UNLESS AN EXEMPTION FROM REGISTRATION IS AVAILABLE. AT THE PRESENT TIME,
EXEMPTIONS FROM REGISTRATION UNDER FEDERAL AND STATE SECURITIES LAWS ARE VERY
LIMITED AND MIGHT BE UNAVAILABLE TO THE OPTIONEE PRIOR TO THE EXPIRATION OF THIS
OPTION. AS A CONSEQUENCE OF THE FOREGOING, THE OPTIONEE MIGHT NOT HAVE AN
OPPORTUNITY TO EXERCISE THIS OPTION AND TO RECEIVE OPTION SHARES UPON SUCH
EXERCISE AND, IF THE OPTIONEE IS ABLE TO EXERCISE THIS OPTION AND TO RECEIVE
OPTION SHARES UPON SUCH EXERCISE, THE OPTIONEE MIGHT NOT HAVE THE OPPORTUNITY TO
TRADE SUCH OPTION SHARES.

10.  NO RIGHTS TO STOCK OPTIONS OR EMPLOYMENT; NO RESTRICTIONS

     Neither Optionee nor any other person shall have any claim or right to be
     granted a Stock Option under the Plan. Having received a Stock Option under
     the Plan shall not give Optionee any right to receive any other grant or
     option under the Plan. Optionee shall have no rights to or interest in any
     Option except as set forth herein, in the Plan, or in another Option
     specifically granted by the Company to Optionee. Neither this Option, the
     Plan, nor any action taken hereunder or under the Plan shall be construed
     as giving any Employee, Consultant or Director any right to be retained in
     the employ of, or be engaged as a Consultant to, or serve as a Director of,
     the Company, as the case may be, or otherwise in any way affect any right
     and power of the Company to terminate the employment or engagement of any
     Employee, Consultant or Director at any time with or without assigning a
     reason therefor. Nothing in the Plan restricts the Company's rights to
     adopt other option plans pertaining to any or all of the Employees,
     Consultants or Directors covered under the Plan or other Employees,
     Consultants or Directors not covered under the Plan.

     THIS AGREEMENT AND THE STOCK OPTION REPRESENTED HEREBY MAY BE AFFECTED,
     WITH REGARD TO BOTH VESTING SCHEDULE AND TERMINATION, BY LEAVES OF ABSENCE,
     A REDUCTION IN THE NUMBER OF HOURS WORKED, PARTIAL DISABILITY AND OTHER
     CHANGES IN OPTIONEE'S EMPLOYEE, CONSULTANT OR DIRECTOR STATUS, AS THE CASE
     MAY BE. THE COMPANY'S POLICIES IN SUCH MATTERS, IF ANY, SHALL BE CONTAINED
     IN THE PLAN GUIDELINES ADOPTED BY THE BOARD. THE PLAN GUIDELINES AND THE
     GUIDELINES, RULES, POLICIES AND REGULATIONS CONTAINED THEREIN MAY BE
     AMENDED AT ANY TIME AND FROM TIME TO TIME BY THE BOARD OF DIRECTORS OF THE
     COMPANY, OR THE COMMITTEE APPOINTED BY SUCH BOARD, IN ITS SOLE DISCRETION
     AND WITH OR WITHOUT NOTICE. OPTIONEE'S RIGHTS HEREUNDER OR UNDER THE PLAN
     AT ANY TIME SHALL BE GOVERNED BY THE PLAN GUIDELINES IN EFFECT AT THE TIME
     OF ANY CHANGE IN OPTIONEE'S STATUS AS CONTEMPLATED ABOVE.

11.  The Stock Option represented by this Agreement is granted pursuant to and
     is controlled by the Plan and by the Plan Guidelines, if any, as adopted by
     the Board and amended from time to time. Optionee, by execution hereof,
     acknowledges receipt of the Plan and the Plan Guidelines as they currently
     exist and acceptance of the terms and conditions of the Plan, the Plan
     Guidelines and of this Agreement.

12.  Optionee hereby acknowledges that, pursuant to the Plan and until the time
     the Company has made a public offering of its securities under the
     Securities Act of 1933, as amended, the Company will have certain
     repurchase rights with respect to any Shares issued to Optionee upon
     exercise of this Stock Option. As a condition to such exercise, Optionee
     shall cause his or her spouse, if any, to execute such documentation as may
     be reasonably required by the Company evidencing such spouse's acceptance
     of and agreement to such repurchase rights.

13.  FOR CALIFORNIA RESIDENTS ONLY: IT IS UNLAWFUL TO CONSUMMATE A SALE OR
     TRANSFER OF THIS SECURITY, OR ANY INTEREST THEREIN, OR TO RECEIVE ANY
     CONSIDERATION THEREFOR, WITHOUT THE PRIOR WRITTEN CONSENT OF THE
     COMMISSIONER OF CORPORATIONS OF THE STATE OF CALIFORNIA, EXCEPT AS
     PERMITTED IN THE COMMISSIONER'S RULES.


<PAGE>

14.  If any provision of this Agreement is held to be unenforceable for any
     reason, it shall be modified rather than voided, if possible, in order to
     achieve the intent of the parties to this option to the extent possible. In
     any event, all other provisions of this Agreement shall be deemed valid and
     enforceable to the full extent.

<PAGE>

                                    EXHIBIT A

                              HELIX BIOMEDIX, INC.

                               NOTICE OF EXERCISE
                                       OF
                                  STOCK OPTION

TO: HELIX BIOMEDIX, INC. (the "Company")

The undersigned hereby exercises Stock Option No. _______, granted on
__________, _____, by the Company pursuant to its 2000 Stock Option Plan
(adopted ________ __, ____), to purchase __________ Shares of Common Stock of
the Company at a price of $________ per Share, for a total purchase price of
$________.

          THE SHARES ARE BEING ACQUIRED BY THE UNDERSIGNED FOR INVESTMENT
          PURPOSES ONLY AND NOT WITH ANY PRESENT INTENTION TO TRANSFER OR
          DISTRIBUTE THE SAME.

By this exercise, the undersigned agrees (i) to provide for the payment by the
undersigned to the Company (in the manner designated by the Company) of the
Company's withholding obligation, if any, relating to the exercise of the
foregoing Stock Option and (ii) if this exercise relates to an Incentive Stock
Option, to notify the Company in writing within fifteen (15) days after the date
of any disposition of any of the Shares of Common Stock issued upon exercise of
the foregoing Stock Option that occurs within two (2) years after the date of
grant of such Stock Option or within one (1) year after such Shares of Common
Stock are issued upon exercise of the foregoing Stock Option.



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