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                                                                   Exhibit 10.37

                             AMERIGROUP CORPORATION
                           2003 EQUITY INCENTIVE PLAN

Section 1.        Purpose of Plan.

                  The name of this plan is the AMERIGROUP Corporation 2003
Equity Incentive Plan (the "Plan"). The purpose of the Plan is to provide
additional incentive to those officers, employees, and nonemployee directors of
the Company and its Parents, Subsidiaries and Affiliates (as hereinafter
defined) whose contributions are essential to the growth and success of the
Company's business, in order to strengthen the commitment of such persons to the
Company and its Parents, Subsidiaries and Affiliates, motivate such persons to
faithfully and diligently perform their responsibilities and attract and retain
competent and dedicated persons whose efforts will result in the long-term
growth and profitability of the Company and its Parents, Subsidiaries and
Affiliates. To accomplish such purposes, the Plan provides that the Company may
grant Incentive Stock Options, Nonqualified Stock Options, Stock Appreciation
Rights, Restricted Stock, Restricted Stock Units, Stock Bonuses and Other
Awards. The Plan is intended to satisfy the requirements of section 162(m) of
the Code and shall be interpreted in a manner consistent with the requirements
thereof.

Section 2.        Definitions.

                  For purposes of the Plan, the following terms shall be defined
as set forth below:

                  (a) "Administrator" means the Board, or if and to the extent
the Board does not administer the Plan, the Committee, in accordance with
Section 3 hereof.

                  (b) "Affiliate" means any corporation 50% or more of the
voting power of the outstanding voting securities of which is owned by the
Company, its Parents or its Subsidiaries, or by any other Affiliate.

                  (c) "Award" means an award of Incentive Stock Options,
Nonqualified Stock Options, Stock Appreciation Rights, Restricted Stock,
Restricted Stock Units, Stock Bonus or Other Awards under the Plan.

                  (d) "Award Agreement" means, with respect to any Award, the
written agreement between the Company and the Participant setting forth the
terms and conditions of the Award.

                  (e) "Board" means the Board of Directors of the Company.

                  (f) "Cause" means, unless a Participant is a party to a
written employment agreement with the Company, Parent, Subsidiary or Affiliate
which contains a definition of "cause," "termination for cause," or any other
similar term or phrase, in which case "Cause" shall have the meaning set forth
in such agreement, conduct involving one or more of the following: (i) the
substantial and continuing failure of the Participant to render services to the
Company or any Parent, Subsidiary or Affiliate in accordance with the
Participant's obligations and position with the Company, Parent, Subsidiary or
Affiliate, after 30 day's notice from the President of the Company or any
Parent, Subsidiary or Affiliate, such notice setting forth in reasonable detail
the nature of such failure, and in the event the Participant fails to cure such
breach or failure within 30 days of notice from the Company or any Parent,
Subsidiary or Affiliate, if such breach or failure is capable of cure;

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(ii) dishonesty, gross negligence, breach of fiduciary duty; (iii) the
commission by the Participant of an act of fraud or embezzlement, as found by a
court of competent jurisdiction; (iv) the conviction of the Participant of a
felony; or a (v) material breach of the terms of an agreement with the Company
or any Parent, Subsidiary or Affiliate, provided that the Company or any Parent,
Subsidiary or Affiliate provides the Participant with adequate notice of such
breach and the Participant fails to cure such breach, if the breach is
reasonably curable, within thirty (30) days after receipt of such notice.

                  (g) "Change in Capitalization" means any increase, reduction,
or change or exchange of Shares for a different number or kind of shares or
other securities or property by reason of a reclassification, recapitalization,
merger, consolidation, reorganization, issuance of warrants or rights, stock
dividend, stock split or reverse stock split, combination or exchange of shares,
repurchase of shares, change in corporate structure or otherwise; or any other
corporate action, such as declaration of a special dividend, that affects the
capitalization of the Company.

                  (h) "Change in Control" means the first to occur of any one of
the events set forth in the following paragraphs:

                        (i) any Person is or becomes the "Beneficial Owner" (as
        defined in Rule 13d-3 under the Exchange Act), directly or indirectly,
        of securities of the Company (not including in the securities
        Beneficially Owned by such Person any securities acquired directly from
        the Company) representing 25% or more of the Company's then outstanding
        securities, excluding any Person who becomes such a Beneficial Owner in
        connection with a transaction described in clause (A) of paragraph
        (iii);

                        (ii) the following individuals cease for any reason to
        constitute a majority of the number of directors then serving:
        individuals who, on the Effective Date of the Plan, constitute the Board
        of Directors and any new director (other than a director whose initial
        assumption of office is in connection with an actual or threatened
        election contest, including but not limited to a consent solicitation,
        relating to the election of directors of the Company) whose appointment
        or election by the Board of Directors or nomination for election by the
        Company's stockholders was approved or recommended by a vote of at least
        two-thirds (2/3) of the directors then still in office who either were
        directors on the Effective Date of the Plan or whose appointment,
        election or nomination for election was previously so approved or
        recommended;

                        (iii) there is consummated a merger or consolidation of
        the Company with any other corporation other than (A) a merger or
        consolidation which results in the directors of the Company immediately
        prior to such merger or consolidation continuing to constitute at least
        a majority of the board of directors of the Company, the surviving
        entity or any parent thereof, or (B) a merger or consolidation effected
        to implement a recapitalization of the Company (or similar transaction)
        in which no Person is or becomes the Beneficial Owner, directly or
        indirectly, of securities of the

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        Company (not including in the securities Beneficially Owned by such
        Person any securities acquired directly from the Company) representing
        25% or more of the combined voting power of the Company's then
        outstanding securities; or

                        (iv) the stockholders of the Company approve a plan of
        complete liquidation or dissolution of the Company or there is
        consummated an agreement for the sale or disposition by the Company of
        all or substantially all of the Company's assets, other than a sale or
        disposition by the Company of all or substantially all of the Company's
        assets to an entity at least a majority of the board of directors of
        which comprises individuals who were directors of the Company
        immediately prior to such sale or disposition.

                  (i) "Code" means the Internal Revenue Code of 1986, as amended
from time to time, or any successor thereto.

                  (j) "Committee" means any committee or subcommittee the Board
may appoint to administer the Plan. If at any time or to any extent the Board
shall not administer the Plan, then the functions of the Administrator specified
in the Plan shall be exercised by the Committee. Unless otherwise determined by
the Board, the composition of the Committee shall at all times consist solely of
persons who are (i) "Nonemployee Directors" as defined in Rule 16b-3 issued
under the Exchange Act, and (ii) "outside directors" as defined in section
162(m) of the Code.

                  (k) "Common Stock" means the common stock, par value $0.01 per
share, of the Company.

                  (l) "Company" means AMERIGROUP Corporation, a Delaware
corporation (or any successor corporation).

                  (m) "Disability" means (1) any physical or mental condition
that would qualify a Participant for a disability benefit under any long-term
disability plan maintained by the Company (or by the Parent, Subsidiary or
Affiliate by which he is employed); (2) when used in connection with the
exercise of an Incentive Stock Option following termination of employment,
disability within the meaning of section 22(e)(3) of the Code; or (3) such other
condition as may be determined in the sole discretion of the Administrator to
constitute Disability.

                  (n) "Eligible Recipient" means an employee, officer or
director (including a nonemployee director) of the Company or of any Parent,
Subsidiary or Affiliate.

                  (o) "Exchange Act" shall mean the Securities Exchange Act of
1934, as amended from time to time.

                  (p) "Exercise Price" means the per share price at which a
holder of an Option may purchase the Shares issuable upon exercise of the
Option.

                  (q) "Fair Market Value" of a share of Common Stock as of a
particular date shall mean (1) the closing sale price reported for such share on
the national securities exchange or

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national market system on which such stock is principally traded on the last day
preceding such date on which a sale was reported, or (2) if the shares of Common
Stock are not then listed on a national securities exchange or national market
system, or the value of such shares is not otherwise determinable, such value as
determined by the Administrator in good faith in its sole discretion.

                  (r) "Freestanding SAR" means an SAR that is granted
independently of any Options, as described Section 11 hereof.


                  (s) "Immediate Family" means any child, stepchild, grandchild,
parent, stepparent, grandparent, spouse, sibling, mother-in-law, father-in-law,
son-in-law, daughter-in-law, brother-in-law or sister-in-law, including adoptive
relationships of the Participant; trusts for the benefit of such immediate
family members; or partnerships in which such immediate family members are the
only partners.

                  (t) "Incentive Stock Option" shall mean an Option that is an
"incentive stock option" within the meaning of section 422 of the Code, or any
successor provision, and that is designated by the Committee as an Incentive
Stock Option.

                  (u) "Nonqualified Stock Option" means any Option that is not
an Incentive Stock Option, including any Option that provides (as of the time
such Option is granted) that it will not be treated as an Incentive Stock
Option.

                  (v) "Option" means an Incentive Stock Option, a Nonqualified
Stock Option, or either or both of them, as the context requires.

                  (w) "Other Award" means an Award granted pursuant to Section
13 hereof.

                  (x) "Parent" means any corporation (other than the Company) in
an unbroken chain of corporations ending with the Company, if each of the
corporations in the chain (other than the Company) owns stock possessing 50% or
more of the combined voting power of all classes of stock in one of the other
corporations in the chain.

                  (y) "Participant" means any Eligible Recipient selected by the
Administrator, pursuant to the Administrator's authority in Section 3 hereof, to
receive grants of Options or Stock Appreciation Rights or awards of Restricted
Stock, Restricted Stock Units, Stock Bonus or Other Awards. A Participant who
receives the grant of an Option is sometimes referred to herein as "Optionee."

                  (z) "Performance Goal" shall mean one or more of the following
business criteria applied to a Participant and/or a business unit or the Company
and/or a Subsidiary: (1) return on total stockholder equity; (2) earnings per
share of Common Stock; (3) net income (before or after taxes); (4) earnings
before all or any interest, taxes, depreciation and/or amortization ("EBIT",
"EBITA", or "EBITDA"); (5) gross revenue; (6) return on assets; (7) market
share; (8) cost reduction goals; (9) earnings from continuing operations, levels
of expense, cost or liability; (10) membership goals, and (11) any combination
of, or a specified increase or decrease of one or more

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of the foregoing over a specified period, in each case, as applicable, as
determined in accordance with generally accepted accounting principles.

                  (aa) "Person" shall have the meaning given in section 3(a)(9)
of the Exchange Act, as modified and used in sections 13(d) and 14(d) thereof,
except that such term shall not include (i) the Company or any of its
subsidiaries, (ii) a trustee or other fiduciary holding securities under an
employee benefit plan of the Company or any of its Affiliates, (iii) an
underwriter temporarily holding securities pursuant to an offering of such
securities, or (iv) a corporation owned, directly or indirectly, by the
stockholders of the Company in substantially the same proportions as their
ownership of stock of the Company.

                  (bb) "Restricted Stock Unit" means the right to receive a
Share or the Fair Market Value of a Share in cash granted pursuant to Section 9
hereof.

                  (cc) "Restricted Stock" means Shares subject to certain
restrictions granted pursuant to Section 8 hereof.

                  (dd) "Shares" means shares of Common Stock and any successor
security.

                  (ee) "Stock Appreciation Right" or "SAR" means an Award,
granted alone or in connection with a related Option, designated as an SAR,
pursuant to Section 11 hereof.

                  (ff) "Stock Bonus" means the right to receive a Share granted
pursuant to Section 10 hereof.

                  (gg) "Subsidiary" means any corporation (other than the
Company) in an unbroken chain of corporations beginning with the Company, if
each of the corporations (other than the last corporation) in the unbroken chain
owns stock possessing 50% or more of the total combined voting power of all
classes of stock in one of the other corporations in the chain.

                  (hh) "Tandem SAR" means an SAR that is granted in connection
with a related Option pursuant to Section 11 hereof, the exercise of which shall
require forfeiture of the right to purchase a Share under the related Option
(and when a Share is purchased under the Option, the Tandem SAR shall similarly
be canceled).

Section 3.   Administration.

                  (a) The Plan shall be administered by the Board or, at the
Board's sole discretion, by the Committee, which shall serve at the pleasure of
the Board. Pursuant to the terms of the Plan, the Administrator shall have the
power and authority, without limitation:

                      (i) to select those Eligible Recipients who shall be
       Participants;

                      (ii) to determine whether and to what extent Options or
       Stock Appreciation Rights or awards of Restricted Stock, Restricted Stock
       Units, Stock Bonus or Other Awards are to be granted hereunder to
       Participants;

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                      (iii) to determine the number of Shares to be covered by
       each Award granted hereunder;

                      (iv) to determine the terms and conditions, not
       inconsistent with the terms of the Plan, of each Award granted hereunder;

                      (v) to determine the terms and conditions, not
       inconsistent with the terms of the Plan, which shall govern all written
       instruments evidencing Options or Stock Appreciation Rights or awards of
       Restricted Stock, Restricted Stock Units, Stock Bonus or Other Awards
       granted hereunder;

                      (vi) to adopt, alter and repeal such administrative rules,
       guidelines and practices governing the Plan as it shall from time to time
       deem advisable; and

                      (vii) to interpret the terms and provisions of the Plan
       and any Award issued under the Plan (and any Award Agreement relating
       thereto), and to otherwise supervise the administration of the Plan.

                  (b) The Administrator may, in its absolute discretion, without
amendment to the Plan, (i) accelerate the date on which any Option or SAR
granted under the Plan becomes exercisable, waive or amend the operation of Plan
provisions respecting exercise after termination of employment or otherwise
adjust any of the terms of such Option or SAR, and (ii) accelerate the lapse of
restrictions, or waive any condition imposed hereunder, with respect to any
Restricted Stock, Restricted Stock Units, Stock Bonus or Other Awards or
otherwise adjust any of the terms applicable to any such Award; provided that no
action under this Section 3(b) shall adversely affect any outstanding Award
without the consent of the holder thereof.

                  (c) All decisions made by the Administrator pursuant to the
provisions of the Plan shall be final, conclusive and binding on all persons,
including the Company and the Participants. No member of the Board or the
Committee, nor any officer or employee of the Company acting on behalf of the
Board or the Committee, shall be personally liable for any action,
determination, or interpretation taken or made in good faith with respect to the
Plan, and all members of the Board or the Committee and each and any officer or
employee of the Company acting on their behalf shall, to the extent permitted by
law, be fully indemnified and protected by the Company in respect of any such
action, determination or interpretation.

                  (d) The Committee in its discretion may condition entitlement
to an Award in whole or in part on the attainment of one or more Performance
Goals. The Committee shall establish any such Performance Goal not later than 90
days after the commencement of the period of service to which the Award relates
(or if less, 25% of such period of service), and once granted, the Committee may
not have discretion to increase the amount payable under such Award, provided,
however, that whether or not an Award is intended to constitute qualified
performance based compensation within the meaning of section 162(m) of the Code,
the Committee shall have the authority to make appropriate adjustments in
Performance Goals under an Award to reflect the impact of extraordinary items
not reflected in such Performance Goals. For purposes of the Plan,

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extraordinary items shall be defined as (1) any profit or loss attributable to
acquisitions or dispositions of stock or assets, (2) any changes in accounting
standards that may be required or permitted by the Financial Accounting
Standards Board or adopted by the Company after the goal is established, (3) all
items of gain, loss or expense for the year related to restructuring charges for
the Company, (4) all items of gain, loss or expense for the year determined to
be extraordinary or unusual in nature or infrequent in occurrence or related to
the disposal of a segment of a business, (5) all items of gain, loss or expense
for the year related to discontinued operations that do not qualify as a segment
of a business as defined in APB Opinion No. 30, and (6) such other items as may
be prescribed by section 162(m) of the Code and the Treasury Regulations
thereunder as may be in effect from time to time, and any amendments, revisions
or successor provisions and any changes thereto.

                  (e) Subject to section 162(m) of the Code and except as
required by Rule 16b-3 under the Exchange Act with respect to grants of Awards
to individuals who are subject to section 16 of the Exchange Act, or as
otherwise required for compliance with Rule 16b-3 under the Exchange Act or
other applicable law, the Committee may delegate all or any part of its
authority under the Plan to an employee, employees or committee of employees of
the Company or any Subsidiary.

Section 4.  Shares Reserved for Issuance Under the Plan.

                  (a) The total number of Shares reserved and available for
issuance under the Plan shall be (i) the sum of (I) 1,650,000 Shares, plus (II)
2,249,500 Shares (the maximum number of shares authorized for issuance under the
Company's 1994 Stock Plan), plus (III) 2,064,000 Shares (the maximum number of
shares authorized for issuance under the Company's 2000 Equity Incentive Plan,
determined without regard to the Company's 1994 Stock Plan), minus (ii) the
number of Shares actually issued (whether before, on or after the Effective Date
of this Plan) under the Company's 1994 Stock Plan and the Company's 2000 Equity
Incentive Plan. Such Shares may consist, in whole or in part, of authorized and
unissued Shares or treasury shares. The grant of any Restricted Stock Units or
SARs that may be settled only in cash shall not reduce the number of shares of
Common Stock with respect to which Awards may be granted pursuant to the Plan.

                  (b) To the extent that (i) an Option expires or is otherwise
cancelled or terminated without being exercised as to the underlying Shares,
(ii) any Shares subject to any award of Stock Appreciation Rights, Restricted
Stock, Restricted Stock Unit, Stock Bonus or Other Awards are forfeited, (iii)
payment for an Option upon exercise is made with Shares or (iv) Shares are
withheld from payment of an Award in satisfaction of any federal, state or local
tax withholding requirements, such Shares shall again be available for issuance
in connection with future Awards granted under the Plan.

                  (c) The aggregate number of Shares with respect to which
Awards (including Awards payable in cash but denominated in Common Stock, i.e.,
cash-settled Restricted Stock Units) may be granted to any individual
Participant during any calendar year shall not exceed 500,000, and the aggregate
number of Shares with respect to which Restricted Stock, Restricted Stock Units,
or Stock Bonus Awards may be granted to any individual Participant during any
calendar year shall not

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exceed 300,000. The aggregate number of Shares with respect to which Restricted
Stock, stock-settled Restricted Stock Units, or Stock Bonus Awards may be
granted shall not exceed 500,000.

Section 5.  Equitable Adjustments.

                  In the event of any Change in Capitalization, an equitable
substitution or proportionate adjustment shall be made in (i) the aggregate
number and/or kind of shares of common stock reserved for issuance under the
Plan, (ii) the kind, number and/or option price of shares of stock or other
property subject to outstanding Options and Stock Appreciation Rights granted
under the Plan, and (iii) the kind, number and/or purchase price of shares of
stock or other property subject to outstanding awards of Restricted Stock,
Restricted Stock Units and Other Awards granted under the Plan, in each case as
may be determined by the Administrator, in its sole discretion. Such other
equitable substitutions or adjustments shall be made as may be determined by the
Administrator, in its sole discretion. Without limiting the generality of the
foregoing, in connection with a Change in Capitalization, the Administrator may
provide, in its sole discretion, for the cancellation of any outstanding Awards
in exchange for payment in cash or other property of the Fair Market Value of
the Shares covered by such Awards reduced, in the case of Options, by the
Exercise Price thereof, and in the case of Stock Appreciation Rights, by the
grant price thereof, or by any other applicable purchase price.

Section 6.  Eligibility.

                  The Participants under the Plan shall be selected from time to
time by the Administrator, in its sole discretion, from among Eligible
Recipients. The Administrator shall have the authority to grant to any Eligible
Recipient Incentive Stock Options, Nonqualified Stock Options, Stock
Appreciation Rights, Restricted Stock, Restricted Stock Units, a Stock Bonus or
Other Awards, provided that directors of the Company or any Parent, Subsidiary
or Affiliate who are not also employees of the Company or of any Parent or
Subsidiary may not be granted Incentive Stock Options.

Section 7.  Options.

                  (a) General. Options may be granted alone or in addition to
other Awards granted under the Plan. Any Option granted under the Plan shall be
evidenced by an Award Agreement in such form as the Administrator may from time
to time approve. The provisions of each Option need not be the same with respect
to each Participant. Participants who are granted Options shall enter into an
Award Agreement with the Company, in such form as the Administrator shall
determine, which Award Agreement shall set forth, among other things, the
Exercise Price of the Option, the term of the Option and provisions regarding
exercisability of the Option granted thereunder. The Options granted under the
Plan may be of two types: (i) Incentive Stock Options and (ii) Nonqualified
Stock Options. To the extent that any Option does not qualify as an Incentive
Stock Option, it shall constitute a separate Nonqualified Stock Option. More
than one Option may be granted to the same Participant and be outstanding
concurrently hereunder. Options granted under the Plan shall be subject to the
terms and conditions set forth in paragraphs (b)-(j) of this

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Section 7 and shall contain such additional terms and conditions, not
inconsistent with the terms of the Plan, as the Administrator shall deem
desirable.

                  (b) Exercise Price. The per share Exercise Price of Shares
purchasable under an Option shall be determined by the Administrator in its sole
discretion at the time of grant but shall not be less than 100% of the Fair
Market Value per Share on such date (or, in the case of Incentive Stock Options,
110% of the Fair Market Value per Share on such date if, on such date, the
Eligible Recipient owns (or is deemed to own under the Code) stock possessing
more than 10% (a "Ten Percent Owner") of the total combined voting power of all
classes of Common Stock).

                  (c) Option Term. The term of each Option shall be fixed by the
Administrator, but no Option shall be exercisable more than ten years after the
date such Option is granted. If the Eligible Participant is a Ten Percent Owner,
an Incentive Stock Option may not be exercisable after the expiration of five
years from the date such Incentive Stock Option is granted.

                  (d) Exercisability. Options shall be exercisable at such time
or times and subject to such terms and conditions, including the attainment of
preestablished corporate performance goals, as shall be determined by the
Administrator in the Award Agreement or after the time of grant, provided that
no action under this Section 7(d) following the time of grant shall adversely
affect any outstanding Option without the consent of the holder thereof. The
Administrator may also provide that any Option shall be exercisable only in
installments, and the Administrator may waive such installment exercise
provisions at any time, in whole or in part, based on such factors as the
Administrator may determine in its sole discretion.

                  (e) Method of Exercise. Options may be exercised in whole or
in part by giving written notice of exercise to the Company specifying the
number of Shares to be purchased, accompanied by payment in full of the
aggregate Exercise Price of the Shares so purchased in cash or its equivalent,
as determined by the Administrator. As determined by the Administrator, in its
sole discretion, payment in whole or in part may also be made (i) by means of
any cashless exercise procedure approved by the Administrator, (ii) in the form
of unrestricted Shares already owned by the Optionee for at least six months on
the date of surrender or by the withholding of Shares that would otherwise be
issued pursuant to the option exercise, in each case to the extent the Shares
have a Fair Market Value on the date of surrender equal to the aggregate option
price of the Shares as to which such Option shall be exercised, provided that,
in the case of an Incentive Stock Option, the right to make payment in the form
of already owned Shares or withheld shares may be authorized only at the time of
grant, or (iii) any combination of the foregoing.

                  (f) Rights as Stockholder. An Optionee shall have no rights to
dividends or any other rights of a stockholder with respect to the Shares
subject to the Option until the Optionee has given written notice of exercise,
has paid in full for such Shares, and has satisfied the requirements of Section
16 hereof.

                  (g) Nontransferability of Options. The Optionee shall not be
permitted to sell, transfer, pledge or assign any Option other than by will and
the laws of descent and distribution and all Options shall be exercisable during
the Participant's lifetime only by the Participant, in each case,

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except as set forth in the following two sentences. During an Optionee's
lifetime, the Administrator may, in its discretion, permit the transfer,
assignment or other encumbrance of an outstanding Option if such Option is a
Nonqualified Stock Option or an Incentive Stock Option that the Administrator
and the Participant intend to change to a Nonqualified Stock Option. Subject to
the approval of the Administrator and to any conditions that the Administrator
may prescribe, an Optionee may, upon providing written notice to the Company,
elect to transfer any or all Options described in the preceding sentence (i) to
members of his or her Immediate Family, provided that no such transfer by any
Participant may be made in exchange for consideration, or (ii) by instrument to
an inter vivos or testamentary trust in which the Options are to be passed to
beneficiaries upon the death of the Participant.

                  (h) Termination of Employment or Service. Except as otherwise
provided in an Award Agreement, if a Participant's employment with or service as
a director of the Company or any Parent, Subsidiary or Affiliate terminates for
any other reason than Cause, (i) Options granted to such Participant, to the
extent that they are exercisable at the time of such termination, shall remain
exercisable for a period of not less than 90 days after such termination (one
year in the case of termination by reason of death or Disability), on which date
they shall expire, and (ii) Options granted to such Optionee, to the extent that
they were not exercisable at the time of such termination, shall expire on the
date of such termination. In the event of the termination of an Optionee's
employment for Cause, all outstanding Options granted to such Participant shall
expire on the date of such termination. Notwithstanding the foregoing, no Option
shall be exercisable after the expiration of its term.

                  (i) Limitation on Incentive Stock Options. To the extent that
the aggregate Fair Market Value of Shares with respect to which Incentive Stock
Options are exercisable for the first time by an Optionee during any calendar
year under the Plan and any other stock option plan of the Company shall exceed
$100,000, such Options shall be treated as Nonqualified Stock Options. Such Fair
Market Value shall be determined as of the date on which each such Incentive
Stock Option is granted.

                  (j) Nonemployee Director Stock Options. The provisions of this
Section 7(j) shall apply only to grants of Nonqualified Stock Options to a
member of the Board who is not an employee of the Company (a "Nonemployee
Director").

                    (i) General. Nonemployee Directors shall receive
        Nonqualified Stock Options under the Plan only subject to the special
        rules set forth in this Section 7(j). The exercise price per share of
        Common Stock purchasable pursuant to a Nonqualified Stock Option granted
        to Nonemployee Director shall be the Fair Market Value of a Share of
        Common Stock on the date of grant.

                    (ii) Timing of Grant. Immediately following his or her first
        election or appointment to the Board, each Nonemployee Director shall be
        granted a Nonqualified Stock Option to purchase such number of Shares of
        Common Stock (including no Shares) as may be determined by the
        Administrator in its sole discretion, and immediately following each
        annual meeting of stockholders, each

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        Nonemployee Director (other than a Nonemployee Director who is first
        appointed or elected to the Board at that meeting) shall be granted a
        Nonqualified Stock Option to purchase such number of Shares of Common
        Stock (including no Shares) as may be determined by the Administrator
        in its sole discretion.

                    (iii) Method and Time of Payment. Each Nonqualified Stock
        Option granted under this Section 7(j) shall be exercised in the manner
        described in Section 7(e).

                    (iv) Term and Exercisability. Each Nonqualified Stock Option
        granted under this Section 7(j) shall (1) become exercisable as the
        Administrator in its sole discretion may provide in an applicable Award
        Agreement and (2) expire ten years from the date of grant.

                    (v) Termination. Except as the Administrator in its sole
        discretion may otherwise provide in an applicable Award Agreement, and
        subject to the Administrator's amendment authority pursuant to Section
        14, in the event of the termination of a Nonemployee Director's service
        with the Company other than for Cause, any outstanding Nonqualified
        Stock Option held by such Nonemployee Director under this Section 7(j),
        to the extent that it is exercisable on the date of such termination,
        may be exercised by such Nonemployee Director (or, if applicable, by his
        or her executors, administrator, legatees or distributees) during such
        period as may be provided in the Award Agreement (or as may be otherwise
        determined by the Administrator) but in no event following the
        expiration of such Nonqualified Stock Option, and the remainder of the
        Nonqualified Stock Option which is not exercisable on the date of such
        termination shall expire upon such termination. In the event of the
        termination of a Nonemployee Director's service with the Company for
        Cause, all outstanding Nonqualified Stock Options granted to such
        Nonemployee Director shall expire. For purposes of the Plan, any
        termination of a Nonemployee Director's service with the Company shall
        be deemed not to occur if the Nonemployee Director continues to serve as
        consultant, employee or in any other capacity.

Section 8.  Restricted Stock.

                  (a) General. Awards of Restricted Stock may be issued either
alone or in addition to other Awards granted under the Plan and shall be
evidenced by an Award Agreement. The Administrator shall determine the Eligible
Recipients to whom, and the time or times at which, Awards of Restricted Stock
shall be made; the number of Shares to be awarded; the price, if any, to be paid
by the Participant for the acquisition of Restricted Stock; and the Restricted
Period (as defined in Section 8(d)) applicable to awards of Restricted Stock.
The provisions of the awards of Restricted Stock need not be the same with
respect to each Participant.

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<PAGE>

                  (b) Purchase Price. The price per Share, if any, that a
Recipient must pay for Shares purchasable under an award of Restricted Stock
shall be determined by the Administrator in its sole discretion at the time of
grant.

                  (c) Awards and Certificates. The prospective recipient of an
Award of Restricted Stock shall not have any rights with respect to any such
Award, unless and until such recipient has executed an Award Agreement
evidencing the Award and delivered a fully executed copy thereof to the Company,
within such period as the Administrator may specify after the award date. Each
Participant who is granted an award of Restricted Stock shall be issued a stock
certificate in respect of such shares of Restricted Stock, which certificate
shall be registered in the name of the Participant and shall bear an appropriate
legend referring to the terms, conditions, and restrictions applicable to any
such Award, provided that the Company may require that the stock certificates
evidencing Restricted Stock granted hereunder be held in the custody of the
Company until the restrictions thereon shall have lapsed, and that, as a
condition of any award of Restricted Stock, the Participant shall have delivered
a stock power, endorsed in blank, relating to the Shares covered by such Award.

                  (d) Nontransferability. Any Award of Restricted Stock granted
pursuant to this Section 8 shall be subject to the restrictions on
transferability set forth in this paragraph (d). During such period as may be
set by the Administrator in the Award Agreement (the "Restricted Period"), the
Participant shall not be permitted to sell, transfer, pledge, hypothecate or
assign Shares of Restricted Stock awarded under the Plan except by will or the
laws of descent and distribution, provided that the Administrator may, in its
sole discretion, provide for the lapse of such restrictions in installments and
may accelerate or waive such restrictions in whole or in part based on such
factors and such circumstances as the Administrator may determine in its sole
discretion. The Administrator may also impose such other restrictions and
conditions, including the achievement of Performance Goals, on Restricted Stock
as it deems appropriate. In no event shall the Restricted Period end with
respect to a Restricted Stock Award prior to the satisfaction by the Participant
of any liability arising under Section 16 hereof. Any attempt to dispose of any
Restricted Stock in contravention of any such restrictions shall be null and
void and without effect.

                  (e) Rights as a Stockholder. Except as provided in Section
8(c) and (d), the Participant shall possess all incidents of ownership with
respect to Shares of Restricted Stock during the Restricted Period, including
the right to receive or reinvest dividends with respect to such Shares (except
that the Administrator may provide in its discretion that any dividends paid in
property other than cash shall be subject to the same restrictions as those that
apply to the underlying Restricted Stock) and to vote such Shares. Certificates
for unrestricted Shares shall be delivered to the Participant promptly after,
and only after, the Restricted Period shall expire without forfeiture in respect
of such awards of Restricted Stock except as the Administrator, in its sole
discretion, shall otherwise determine.

                  (f) Termination of Employment. The rights of Participants
granted an Award of Restricted Stock upon termination of employment with or
service as a director of the Company or any Parent, Subsidiary or Affiliate for
any reason during the Restricted Period shall be set forth in the Award
Agreement governing such Award.

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<PAGE>

Section 9.  Restricted Stock Units

                  (a) Vesting. At the time of the grant of Restricted Stock
Units, the Committee may impose such restrictions or conditions to the vesting
of such Restricted Stock Units as it, in its sole discretion, deems appropriate,
to be contained in the Award Agreement. The Committee may divide such Restricted
Stock Units into classes and assign different vesting conditions for each class.
Provided that all conditions to the vesting of a Restricted Stock Unit are
satisfied, and except as provided in Section 9(c), upon the satisfaction of all
vesting conditions with respect to a Restricted Stock Unit, such Restricted
Stock Unit shall vest. The provisions of the awards of Restricted Stock Units
need not be the same with respect to each Participant.

                  (b) Benefit Upon Vesting. Upon the vesting of a Restricted
Stock Unit, the Participant shall be entitled to receive, within 30 days of the
date on which such Restricted Stock Unit vests, an amount in cash or Common
Stock with a Fair Market Value equal to the sum of (1) the Fair Market Value of
a Share of Common Stock on the date on which such Restricted Stock Unit vests
and (2) the aggregate amount of cash dividends paid with respect to a Share of
Common Stock during the period commencing on the date on which the Restricted
Stock Unit was granted and terminating on the date on which such Share vests.

                  (c) Termination of Employment. The rights of Participants
granted a Restricted Stock Unit upon termination of employment with or service
as a director of the Company or any Parent, Subsidiary or Affiliate for any
reason before the Restricted Stock Unit vests shall be set forth in the Award
Agreement governing such Award.

Section 10. Stock Bonus Awards

                  In the event that the Committee grants a Stock Bonus, a
certificate for the shares of Common Stock constituting such Stock Bonus shall
be issued in the name of the Participant to whom such grant was made and
delivered to such Participant as soon as practicable after the date on which
such Stock Bonus is payable.

Section 11. Stock Appreciation Rights.

                  (a) Grant of SARs. Subject to the terms and conditions of the
Plan, SARs may be granted to Participants at any time and from time to time as
shall be determined by the Administrator in its sole discretion. The
Administrator may grant Freestanding SARs, Tandem SARs, or any combination of
these forms of SAR. The Administrator shall have complete discretion in
determining the number of SARs granted to each Participant (subject to Section 4
hereof) and, consistent with the provisions of the Plan, in determining the
terms and conditions pertaining to such SARs. The provisions of the awards of
SARs need not be the same with respect to each Participant.

                  (b) Grant Price. The grant price of a Freestanding SAR shall
equal the Fair Market Value of a Share on the date of grant of the SAR. The
grant price of Tandem SARs shall equal the Exercise Price of the related Option.

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<PAGE>

                  (c) Exercise of Tandem SARs. Tandem SARs may be exercised for
all or part of the Shares subject to the related Option upon the surrender of
the right to exercise the equivalent portion of the related Option. A Tandem SAR
may be exercised only with respect to the Shares for which its related Option is
then exercisable. Notwithstanding any other provision of this Plan to the
contrary, with respect to a Tandem SAR granted in connection with an Incentive
Stock Option: (i) the Tandem SAR will expire no later than the expiration of the
underlying Incentive Stock Option; (ii) the value of the payout with respect to
the Tandem SAR may be for no more than one hundred percent (100%) of the
difference between the Exercise Price of the underlying Incentive Stock Option
and the Fair Market Value of the Shares subject to the underlying Incentive
Stock Option at the time the Tandem SAR is exercised; and (iii) the Tandem SAR
may be exercised only when the Fair Market Value of the Shares subject to the
Incentive Stock Option exceeds the Exercise Price of the Incentive Stock Option.

                  (d) Exercise of Freestanding SARs. Freestanding SARs may be
exercised upon whatever terms and conditions the Administrator, in its sole
discretion, imposes upon them.

                  (e) SAR Agreement. Each SAR grant shall be evidenced by an
Award Agreement that shall specify the grant price, the term of the SAR, and
such other provisions as the Administrator shall determine.

                  (f) Term of SARs. The term of an SAR granted under the Plan
shall be determined by the Administrator, in its sole discretion; provided,
however, that such term shall not exceed ten (10) years.

                  (g) Payment of SAR Amount. Upon exercise of an SAR, a
Participant shall be entitled to receive payment from the Company in an amount
determined by multiplying:

                      (i) the difference between the Fair Market Value of a
       Share on the date of exercise over the grant price; by

                      (ii) the number of Shares with respect to which the SAR is
       exercised.

At the discretion of the Administrator, the payment upon SAR exercise may be in
cash, in Shares of equivalent value, or in some combination thereof. The
Administrator's determination regarding the form of SAR payout shall be set
forth in the Award Agreement pertaining to the grant of the SAR.

Section 12. Effect of Change in Control.

                  Except as otherwise provided in an Award Agreement, all
outstanding Shares of Restricted Stock and Restricted Stock Units granted to a
Participant which have not theretofore vested shall immediately vest and all
restrictions on such Shares and Units shall immediately lapse, and each Option
and Stock Appreciation Right granted to a Participant and outstanding at such
time shall become fully and immediately exercisable, if (i) there is a Change in
Control and (ii) the Participant's employment with or service as a director of
the Company or any Parent, Subsidiary or Affiliate is terminated by such entity
for any reason other than for Cause within 2 years following

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<PAGE>

the Change in Control, or the Participant terminates employment with (or other
service to) the Company or any Parent, Subsidiary or Affiliate within 2 years
following the Change in Control and after there is a material adverse change in
the nature or status of the Participant's duties or responsibilities
from those in effect immediately prior to the Change in Control.

Section 13. Other Awards.

                  Other forms of Awards ("Other Awards") valued in whole or in
part by reference to, or otherwise based on, Common Stock may be granted either
alone or in addition to other Awards under the Plan. Subject to the provisions
of the Plan, the Administrator shall have sole and complete authority to
determine the persons to whom and the time or times at which such Other Awards
shall be granted, the number of Shares to be granted pursuant to such Other
Awards and all other conditions of such Other Awards.

Section 14. Amendment and Termination.

                  The Board may amend, alter or discontinue the Plan, but no
amendment, alteration, or discontinuation shall be made that would impair the
rights of a Participant under any Award theretofore granted without such
Participant's consent. Unless the Board determines otherwise, the Board shall
obtain approval of the Company's stockholders for any amendment that would
require such approval in order to satisfy the requirements of section 162(m) of
the Code, section 422 of the Code, stock exchange rules or other applicable law.
The Administrator may amend the terms of any Award theretofore granted,
prospectively or retroactively, but, subject to Section 4 of Plan, no such
amendment shall impair the rights of any Participant without his or her consent.
Notwithstanding the foregoing provisions of this Section 14, neither the Plan
nor any outstanding Option shall be amended to decrease the Exercise Price of
any outstanding Option unless first approved by the requisite vote of
stockholders.

Section 15. Unfunded Status of Plan.

                  The Plan is intended to constitute an "unfunded" plan for
incentive compensation. With respect to any payments not yet made to a
Participant by the Company, nothing contained herein shall give any such
Participant any rights that are greater than those of a general creditor of the
Company.

Section 16. Withholding Taxes.

                  (a) Whenever cash is to be paid pursuant to an Award, the
Company shall have the right to deduct therefrom an amount sufficient to satisfy
any federal, state and local tax withholding requirements related thereto.
Whenever Shares are to be delivered pursuant to an Award, the Company shall have
the right to require the Participant to remit to the Company in cash an amount
sufficient to satisfy any federal, state and local tax withholding requirements
related thereto. With the approval of the Administrator, a Participant may
satisfy the foregoing requirement by electing to have the Company withhold from
delivery Shares or by delivering Shares already owned by the Participant for at
least six months, in each case, having a value equal to the minimum amount of
tax

                                       15

<PAGE>

required to be withheld. Such shares shall be valued at their Fair Market Value
on the date of which the amount of tax to be withheld is determined. Fractional
share amounts shall be settled in cash. Such an election may be made with
respect to all or any portion of the shares to be delivered pursuant to an
Award.

                  (b) If the Participant makes a disposition, within the meaning
of section 424(c) of the Code and regulations promulgated thereunder, of any
Share or Shares issued to such Participant pursuant to such Participant's
exercise of an Incentive Stock Option, and such disposition occurs within the
two-year period commencing on the day after the date of grant or within the
one-year period commencing on the day after the date of exercise, such
Participant shall, within ten (10) days of such disposition, notify the Company
thereof and thereafter immediately deliver to the Company any amount of federal,
state or local income taxes and other amounts which the Company informs the
Participant the Company is required to withhold.

Section 17. General Provisions.

                  (a) Shares shall not be issued pursuant to the exercise of any
Award granted hereunder unless the exercise of such Award and the issuance and
delivery of such Shares pursuant thereto shall comply with all relevant
provisions of law, including, without limitation, the Securities Act of 1933, as
amended, the Exchange Act and the requirements of any stock exchange upon which
the Common Stock may then be listed, and shall be further subject to the
approval of counsel for the Company with respect to such compliance. The Company
shall be under no obligation to effect the registration pursuant to the
Securities Act of 1933, as amended, of any interests in the Plan or any shares
of Common Stock to be issued hereunder or to effect similar compliance under any
state laws.

                  (b) All certificates for Shares delivered under the Plan shall
be subject to such stock-transfer orders and other restrictions as the
Administrator may deem advisable under the rules, regulations, and other
requirements of the Securities and Exchange Commission, any stock exchange upon
which the Common Stock may then be listed, and any applicable federal or state
securities law, and the Administrator may cause a legend or legends to be placed
on any such certificates to make appropriate reference to such restrictions. The
Administrator may require, as a condition of the issuance and delivery of
certificates evidencing Shares pursuant to the terms hereof, that the recipient
of such Shares make such agreements and representations as the Administrator, in
its sole discretion, deems necessary or desirable.

                  (c) Nothing contained in the Plan shall prevent the Board from
adopting other or additional compensation arrangements, subject to stockholder
approval, if such approval is required; and such arrangements may be either
generally applicable or applicable only in specific cases. The adoption of the
Plan shall not confer upon any Eligible Recipient any right to continued
employment or service with the Company or any Parent, Subsidiary or Affiliate,
as the case may be, nor shall it interfere in any way with the right of the
Company or any Parent, Subsidiary or Affiliate to terminate the employment or
service of any of its Eligible Recipients at any time.

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<PAGE>

                  (d) No fractional shares of Common Stock shall be issued or
delivered pursuant to the Plan. The Administrator shall determine whether cash,
other Awards, or other property shall be issued or paid in lieu of such
fractional shares or whether such fractional shares or any rights thereto shall
be forfeited or otherwise eliminated.

                  (e) If any provision of the Plan is held to be invalid or
unenforceable, the other provisions of the Plan shall not be affected but shall
be applied as if the invalid or unenforceable provision had not been included in
the Plan.

                  (f) The Plan and all Awards shall be governed by the laws of
the State of Delaware without regard to its principles of conflict of laws.

Section 18. Stockholder Approval; Effective Date of Plan.

                  Subject to the approval of the Plan by the stockholders of the
Company, the Plan shall be effective as of February 11, 2003, the date of its
approval by the Board (the "Effective Date"). Any Option that is designated as a
Incentive Stock Option shall be a Nonqualified Stock Option if the Plan is not
approved by the stockholders of the Company within twelve (12) months before or
after the Effective Date of the Plan. No award that is intended to qualify as
performance-based compensation within the meaning of section 162(m) of the Code
shall be effective unless and until the Plan is approved by the stockholders of
the Company.

Section 19. Term of Plan.

                  No Award shall be granted pursuant to the Plan on or after the
tenth anniversary of the Effective Date of the Plan, but Awards theretofore
granted may extend beyond that date.

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