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                                                                  Exhibit 10.3

                              VISIBLE GENETICS INC.

                           EMPLOYEE SHARE OPTION PLAN
                        (AS AMENDED THROUGH MAY 19, 1999)
                        ---------------------------------

1. PURPOSE

The purpose of this Employee Share Option Plan (the "Plan") of Visible Genetics
Inc., an Ontario corporation (the "Company"), is to provide an incentive to
officers, consultants and key employees of the Company and its affiliates by
providing them with the opportunity, through share options, to acquire an
increased proprietary interest in the Company.

2. ADMINISTRATION

The Compensation Committee of the Company's Board of Directors (the "Directors")
shall supervise and administer the Plan.

3. GRANTING OF OPTIONS

The Directors may from time to time by resolution designate persons who are
officers, consultants or key employees of the Company or any of its affiliates
(the "Optionees") to whom options to purchase common shares of the Company (the
"Common Shares") may be granted and the number of the Common Shares to be
optioned to each of them, provided that the total number of Common Shares to be
optioned under this Plan shall not exceed the number provided for in Section 4
hereof. Options shall be granted for a period of up to ten (10) years from the
date, in each case, of the grant, and otherwise upon and subject to such terms,
conditions, limitations, prohibitions and restrictions as are herein contained,
and the said number of authorized and unissued Common Shares (subject to
adjustment pursuant to the provisions of Section 8 hereof) be and they are
hereby set aside and reserved for allotment for the purpose of this Plan.

The Directors may, in their discretion, require as conditions to the grant or
exercise of any option that the Optionee shall have:

     a)   Represented, warranted and agreed in form and substance satisfactory
          to the Company that the Optionee is acquiring and will acquire such
          option and the Common Shares to be issued upon exercise thereof or, as
          the case may be, is acquiring such Common Shares, for the Optionee's
          own account for investment and not with a view to or in connection
          with any distribution, that the Optionee has access to such
          information as is necessary to enable the Optionee to evaluate the
          merits and risks of such investment and that the Optionee is able to
          bear the economic risk of holding such Common Shares for an indefinite
          period;

     b)   Agreed to restrictions on transfer in form and substance satisfactory
          to the Company and to an endorsement on the option or certificate
          representing the Common Shares making appropriate reference to such
          restrictions; and



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     c)   Agreed to indemnify the Company in connection with the foregoing.

In addition, any option granted under this Plan shall be subject to the
requirement that, if at any time counsel to the Company shall determine that the
listing, registration or qualification of the Common Shares subject to such
option upon any securities exchange or under any law or regulation of any
jurisdiction, or the consent or approval of any securities exchange or any
governmental or regulatory body, is necessary as a condition of, or in
connection with, the grant or exercise of such option or the issuance or
purchase of Common Shares hereunder, such option may not be accepted or
exercised in whole or in part unless such listing, registration, qualification,
consent or approval shall have been effected or obtained on conditions
acceptable to the Directors. Nothing herein shall be deemed to require the
Company to apply for or to obtain such listing, registration, qualification,
consent or approval.

4. SHARES SUBJECT TO PLAN

The maximum number of Common Shares which may be reserved for issuance under
this Plan, subject to adjustment or increase of such number pursuant to the
provisions of Section 8 hereof, is 1,500,000 Common Shares. In addition, the
aggregate number of Common Shares reserved for issuance under all options
granted to any one Optionee, whether granted pursuant to a plan or any other
option right or share purchase right (whether granted pursuant to a plan or
otherwise) granted by the Company and outstanding at such time, shall not exceed
the number of Common Shares permitted to be so reserved to such Optionee by law
and by the regulations, rules or policies of the several securities authorities
and stock exchanges to which the Company is on the relevant date subject.

Common Shares in respect of which options are not exercised shall be available
for options subsequently granted. No fractional Common Shares may be purchased
under this Plan.

5. TERMS, CONDITIONS AND FORM OF OPTIONS

Each option granted under the Plan shall be evidenced by a written agreement in
such form as the Directors shall from time to time approve, which agreements
shall comply with and be subject to the following terms and conditions:

     a)   OPTION EXERCISE PRICE. The option exercise price per Common Share for
          each option granted under the Plan shall be as determined by the
          Directors, provided that such price shall not be less than the current
          market price of the Common Shares on the date of the grant. For the
          purposes hereof, the term "current market price" shall mean the
          current market price as determined in good faith by the Directors.

     b)   OPTIONS NON-TRANSFERABLE. Each option granted under the Plan by its
          terms shall not be transferable by the optionee otherwise than by
          will, or by the laws of descent and distribution, or pursuant to a
          qualified domestic relations order (as defined in Section 414(p) of
          the United states Internal Revenue Code (the



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          "Code")), and shall be exercised during the lifetime of the optionee
          only by him. No option or interest therein may be transferred,
          assigned, pledged or hypothecated by the optionee during his lifetime,
          whether by operation of law or otherwise, or be made subject to
          execution, attachment or similar process.

     c)   EXERCISE PERIOD. Except as otherwise provided in the plan, each option
          may be exercised fully on the date of grant of such option, provided
          that, subject to the provisions of Section 5(d), no option may be
          exercised more than ninety (90) days after the optionee ceases to
          serve as an employee or consultant of the Company. No option shall be
          exercisable after the expiration of ten (10) years from the date of
          grant or prior to approval of the Plan by the shareholders of the
          Company, whichever is earlier.

     d)   EXERCISE PERIOD UPON DISABILITY OR DEATH. Notwithstanding the
          provisions of Section 5(c), any option granted under the Plan:

               (i)  may be exercised in full by an optionee who becomes disabled
                    (within the meaning of Section 22(e)(3) of the Code or any
                    successor provision thereof) while serving as an employee or
                    consultant of the Company; or

               (ii) may be exercised:

                    (A)  in full upon the death of an optionee while serving as
                         an employee or consultant of the Company, or

                    (B)  to the extent when exercisable upon the death of an
                         optionee within ninety (90) days of ceasing to serve as
                         an employee or consultant of the Company,

               by   the person to whom it is transferred by will, by the laws of
                    descent and distribution, or by written notice filed
                    pursuant to Section 5(g);

                  in each such case within the period of one year after the date
                  the optionee ceases to be such an employee or consultant;
                  provided, that no option shall be exercisable after the
                  expiration of ten (10) years from the date of grant.

     (e)  EXERCISE PROCEDURE. Options may be exercised only by written notice to
          the Company at its principal office accompanied by payment of the full
          consideration for the Common Shares as to which they are exercised.

     (f)  PAYMENT OF PURCHASE PRICE. Options granted under the Plan may
          provide for the payment of the exercise price (i) by delivery of
          cash or a check to the order of the Company in an amount equal to
          the exercise price of such options or, (ii) to the extent provided
          in the applicable option agreement, by delivery to the Company of
          Common Shares then owned by the optionee having a fair market value
          equal

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          in amount to the exercise price of the Options being exercised, or
          (iii) by any combination of such methods of payment. The fair market
          value of any Common Shares or other non-cash consideration which may
          be delivered upon exercise of an option shall be determined by the
          Directors.

     (g)  EXERCISE OF REPRESENTATIVE FOLLOWING DEATH OF DIRECTOR. A Director, by
          written notice to the Company, may designate one or more persons (and
          from time to time change such designation) including his legal
          representative, who, by reason of his death, shall acquire the right
          to exercise all or a portion of the option. If the person or persons
          so designated wish to exercise any portion of the option, they must do
          so within the term of the option as provided herein. Any exercise by a
          representative shall be subject to the provisions of the Plan.

6. ASSIGNMENTS

The rights and benefits under the Plan may not be assigned except for the
designation of a beneficiary as provided in Section 5.

7. LIMITATION OF RIGHTS

     (a)  NO RIGHT TO CONTINUE AS AN EMPLOYEE OR CONSULTANT. Neither the Plan
          nor the granting of an option nor any other action taken pursuant to
          the Plan, shall constitute or be evidence of any agreement or
          understanding, express or implied, that the Company will retain an
          employee or consultant for any period of time.

     (b)  NO SHAREHOLDERS' RIGHTS FOR OPTIONS. An optionee shall have no rights
          as a shareholder with respect to the Common Shares covered by his
          options until the date of the issuance to him of a share certificate
          therefor, and no adjustment will be made for dividends or other rights
          for which the record date is prior to the date such certificate is
          issued.

8. CHANGES IN CAPITAL STOCK

     (a)  If (x) the outstanding shares of Common Shares are increased,
          decreased or exchanged for a different number or kind of share or
          other security of Company, or (y) additional shares of Common
          Shares or new or different shares of Common Shares or other
          securities of the Company or other non-cash assets are distributed
          with respect to such shares or other securities, through or as a
          result of any merger, consolidation, sale of all or substantially
          all of the assets of the Company, reorganization, recapitalization,
          reclassification, stock dividend, stock split, reverse stock split
          or other similar transactions with respect to such shares or other
          securities, and appropriate and proportionate adjustment shall be
          made in (i) the maximum number and kind of shares reserved for
          issuance under the plan, and (ii) the number and kind of shares or
          other securities subject to then outstanding options under the Plan
          and (iii) the price of each share subject to any then outstanding
          options under the Plan, without changing the aggregate purchase

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          price as to which such options remain exercisable. No fractional
          shares will be issued under the Plan on account of any such
          adjustments. Notwithstanding the foregoing, no adjustment shall be
          made pursuant to this Section 8 if such adjustment would cause the
          Plan to fail to comply with Rule 16b-3 or any successor rule
          promulgated pursuant to Section 16 of the Securities Exchange Act of
          1934.

     (b)  In the event that the Company is merged or consolidated into or with
          another corporation (in which consolidation or merger, the
          shareholders of the Company receive distributions of cash or
          securities of another issuer as a result thereof), or in the event
          that all or substantially all of the assets of the Company are
          acquired by any other person or entity, or in the event of a
          reorganization or liquidation of the Company, the Directors of the
          Company, or the board of directors of any corporation assuming the
          obligations of the Company, shall, as to outstanding options take one
          or more of the following actions: (i) provide that such options shall
          be assumed, or equivalent options shall be substituted, by the
          acquiring or succeeding corporation (or an affiliate thereof), (ii)
          upon written notice to the optionee, provide that all unexercised
          options will terminate immediately prior to the consummation of such
          transaction unless exercised by the optionee within a specified period
          following the date of such notice, or (iii) if, under the terms of a
          merger transaction, holders of the Common Shares of the Company will
          receive upon consummation thereof a cash payment for each share
          surrendered in the merger (the "Merger Price"), make or provide for a
          cash payment to the optionees equal to the difference between (A) the
          Merger Price times the number of shares of Common Shares subject to
          such outstanding options (to the extent then exercisable at prices not
          in excess of the Merger Price) and (B) the aggregate exercise price of
          all such outstanding options in exchange for the termination of such
          options.

9. AMENDMENT OF THE PLAN

The Directors may suspend or discontinue the Plan or review or amend it in any
respect whatsoever; provided, however, that without approval of the shareholders
of the Company no revision or amendment shall change the number of shares
subject to the Plan or the number of shares issuable to any shareholder of the
Company under the Plan (except as provided in Section 8), change the designation
of the class of persons eligible to receive options, or materially increase the
benefits accruing to participants under the Plan.

10. WITHHOLDING

The Company shall have the right to deduct from payments of any kind otherwise
due to the optionee, any federal, state or local taxes of any kind required by
law to be withheld with respect to any shares issued upon exercise of options
under the Plan.



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11. EFFECTIVE DATE AND DURATION OF THIS PLAN

     (a)  EFFECTIVE DATE. The Plan shall become effective when adopted by the
          Directors and approved by the Company's shareholders. Amendments to
          the plan not requiring shareholder approval shall become effective
          when adopted by the Directors; amendments requiring shareholder
          approval shall become effective when adopted by the Directors, but no
          option granted after the date of such amendment shall become
          exercisable (to the extent that such amendment to the Plan was
          required to enable the Company to grant such option to a particular
          optionee) unless and until such amendment shall have been approved by
          the Company's shareholders. If such shareholder approval is not
          obtained within twelve months of the Board's adoption of such
          amendment, any options granted on or after the date of such amendment
          shall terminate to the extent that such amendment to the Plan was
          required to enable the Company to grant such option to a particular
          optionee.

     (b)  TERMINATION. Unless sooner terminated by the Directors, the Plan shall
          terminate upon the date on which all shares available for issuance
          under the Plan shall have been issued pursuant to the exercise or
          cancellation of options granted under the Plan.

12. NOTICE

Any written notice to the Company required by any of the provisions of the Plan
shall be addressed to the Secretary of the Company and shall become effective
when it is received.

13. GOVERNMENTAL REGULATION

The Company's obligation to sell and deliver shares of Common Shares under the
plan is subject to the approval of or requirements of any governmental authority
applicable in connection with the authorization, issuance or sale of such
shares.

14. COMPLIANCE WITH RULE 16b-3

Transactions under the Plan are intended to comply with all applicable
conditions of Rule 16b-3 or its successor promulgated pursuant to Section 16 of
the Securities Exchange Act of 1934. To the extent any provision of the Plan or
action by the Directors in administering the plan fails to so comply, it shall
be deemed null and void, to the extent permitted by law and deemed advisable by
the Directors.

15. GOVERNING LAW

The Plan and all determinations made and actions taken pursuant hereto shall be
governed by the laws of the Province of Ontario and the laws of Canada
applicable therein.



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16. SUCCESSORS AND ASSIGNS

This Plan shall inure to the benefit of and be binding upon each successor and
assign of the Company. All obligations imposed upon an optionee, and all rights
granted to the Company hereunder, shall be binding upon the optionee's heirs,
legal representatives and successors.

17. ENTIRE AGREEMENT

This Plan and the written agreement with respect to each option granted under
this Plan constitute the entire agreement with respect to the subject matter
hereof and thereof, provided that in the event of any inconsistency between the
Plan and such written agreement, the terms and conditions of this Plan shall
control.

18. INCENTIVE STOCK OPTIONS

Notwithstanding anything in the Plan to the contrary, options granted under the
Plan which are intended to be "Incentive Stock Options" within the meaning of
Section 422 of the Code shall be subject to the following additional terms and
conditions:

     (a)  EXPRESS DESIGNATION. All Incentive Stock Options granted under the
          Plan shall, at the time of grant, be specifically designated as such
          in the written agreement evidencing such Incentive Stock Options.
          Incentive Stock Options may be granted only to persons who are, at the
          time of grant, employees of the Company or any parent or subsidiary of
          the Company as respectively defined in Sections 424(e) and 424(f) of
          the Code (an "Affiliate"). No Incentive Stock Option may be granted
          hereunder more than ten (10) years from the earlier of (i) the date
          the Plan was adopted, or (ii) the date the Plan was approved by the
          shareholders of the Company.

     (b)  EXERCISE PRICE. The option exercise price per Common Share subject to
          each Incentive Stock Option granted under the Plan shall not be less
          than 100% of the fair market value of a Common Share at the time of
          grant of such option. For purposes of the Plan, the fair market value
          of a Common Share as of a specified date shall be determined in good
          faith by the Directors. In no case shall the fair market value of a
          Common Share be determined with regard to restrictions other than
          restrictions which, by their terms, will never lapse.

     (c)  10% SHAREHOLDER. Notwithstanding the foregoing, if any employee to
          whom an Incentive Stock Option is to be granted under the Plan is, at
          the time of the grant of such option, the owner of stock possessing
          more than 10% of the total combined voting power of all classes of
          stock of the Company (after taking into account the attribution of
          stock ownership rules of Section 424(d) of the Code), then the
          following special provisions shall be applicable to the Incentive
          Stock Option granted to such individual:



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               (i)  the option exercise price per Common Share subject to such
                    Incentive Stock Option shall not be less than 110% of the
                    fair market value of a Common Share at the time of grant;
                    and

               (ii) the option exercise period shall not exceed five (5) years
                    from the date of grant.

     (d)  DOLLAR LIMITATION. For so long as the Code shall so provide, options
          granted to any employee under the Plan (and any other Incentive Stock
          Option plans of the Company) which are intended to constitute
          Incentive Stock Options shall not constitute Incentive Stock Options
          to the extent that such options, in the aggregate, become exercisable
          for the first time in any one calendar year for Common Shares with an
          aggregate fair market value, as of the respective date or dates of
          grant, of more than $100,000.

     (e)  EXERCISABILITY, TERMINATION OF EMPLOYMENT, DEATH AND DISABILITY. No
          Incentive Stock Option may be exercised unless, at the time of such
          exercise, the optionee is, and has been continuously since the date of
          grant of his or her option, employed by the Company or an Affiliate,
          except that:

               (i)  an Incentive Stock Option may be exercised within the period
                    of three (3) months after the date the optionee ceases to be
                    an employee of the Company or an Affiliate (or within such
                    lesser period as may be specified in the acceptable option
                    agreement), to the extent it is otherwise exercisable at the
                    time of such cessation,

               (ii) if the optionee dies while in the employ of the Company or
                    an Affiliate, or within three (3) months after the optionee
                    ceases to be such an employee, the Incentive Stock Option
                    may be exercised by the person to whom it is transferred by
                    will or the laws of descent and distribution within the
                    period of one (1) year after the date of death (or within
                    such lesser period as may be specified in the applicable
                    option agreement), to the extent it is otherwise exercisable
                    at the time of the optionee's death, and

               (iii) if the optionee becomes disabled (within the meaning of
                    Section 22(e)(3) of the Code or any successor provisions
                    thereto) while in the employ of the Company or an Affiliate,
                    the Incentive Stock Option may be exercised within the
                    period of one (1) year after the date the optionee ceases to
                    be such an employee because of such disability (or within
                    such lesser period as may be specified in the applicable
                    option agreement), to the extent it is otherwise exercisable
                    at the time of such cessation.

          For purposes of any Incentive Stock Option granted hereunder,
          "employment" shall be defined in accordance with the provisions of
          Section 1.421-7(h) of the



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          U.S. Income Tax Regulations (or any successor regulations).
          Notwithstanding the foregoing provisions, no Incentive Stock Option
          may be exercised after the earlier of (1) its expiration date, or (2)
          the tenth anniversary of the date of which the Incentive Stock Options
          is granted.

     (f)  TRANSFER, ASSIGNMENT. No Incentive Stock Option granted under this
          Plan shall be assignable or otherwise transferable by the optionee,
          except by will or by the laws of descent and distribution. An
          Incentive Stock Option may be exercised during the lifetime of the
          optionee only by the optionee.

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