EXHIBIT 10.4
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                      PHAGE THERAPEUTICS INTERNATIONAL INC.

                                 2000 STOCK PLAN


1.  Purposes  of the Plan.  The  purposes  of this Stock Plan are to attract and
retain the best available personnel for positions of substantial responsibility,
to provide additional  incentive to Employees,  Directors and Consultants and to
promote the success of the Company's  business.  Options  granted under the Plan
may be Incentive Stock Options or Non-statutory  Stock Options, as determined by
the  Administrator  at the time of  grant.  Stock  Purchase  Rights  may also be
granted under the Plan.

2 Definitions. As used in this Stock Plan, the following definitions will apply:

           (a)       "Administrator" means the Board or any of its Committees as
                     will be administering the Plan under Section 4 of the Plan.
           (b)       "Applicable  Laws" means the  requirements  relating to the
                     administration  of stock  option  plans  under  U.S.  state
                     corporate laws, U.S. federal and state securities laws, the
                     Code, any stock  exchange or quotation  system on which the
                     Common Stock is listed or quoted and the applicable laws of
                     any other  country or  jurisdiction  where Options or Stock
                     Purchase Rights are granted under the Plan.
           (c)       "Board" means the Board of Directors of the Company.
           (d)       "Code" means the Internal Revenue Code of 1986, as amended.
           (e)       "Committee" means a committee of Directors appointed by the
                      Board under Section 4 of the Plan.
           (f)       "Common Stock" means the Common Stock of the Company.
           (g)       "Company" means  Phage Therapeutics International Inc., a
                      Florida corporation.
           (h)       "Consultant" means any person who is engaged by the Company
                      or any Parent or Subsidiary to render
                     consulting or advisory services to such entity.
           (i)       "Director" means a member of the Board of Directors of the
                      Company.
           (j)       "Disability" means total and permanent disability as
                      defined in Section 22(e)(3) of the Code.
           (k)       "Employee" means any person, including Officers and
                     Directors, employed by the Company or any Parent or
                     Subsidiary of the Company. A Service Provider will not
                     cease to be an Employee in the case of (i) any leave of
                     absence approved by the Company or (ii) transfers between
                     locations of the Company or between the Company,
                     its Parent, any Subsidiary, or any successor. For purposes
                     of Incentive Stock Options, no such leave may exceed
                     ninety days, unless re-employment on expiration of such
                     leave is guaranteed by statute or contract. If re-
                     employment on expiration of a leave of absence approved by
                     the Company is not so guaranteed, on the 181st
                     day of such leave any Incentive Stock Option held by the
                     Optionee will cease to be treated as an Incentive Stock
                     Option and will be treated for tax purposes as a Non-
                     statutory Stock Option. Neither service as a Director nor
                     payment of a director's fee by the Company will be
                     sufficient to constitute "employment" by the Company.
           (l)       "Exchange Act" means the Securities Exchange Act of 1934,
                     as amended.
           (m)       "Fair Market Value" means, as of any date, the value of
                      Common Stock determined as follows:
                     (i)       If the Common Stock is listed on any established
                               stock exchange or a national market system,
                               including without  limitation the Nasdaq National
                               Market  or  The  Nasdaq  SmallCap  Market  of The
                               Nasdaq Stock  Market,  its Fair Market Value will
                               be the closing  sales price for the stock (or the
                               closing bid, if no sales were reported) as quoted
                               on the  exchange  or system  for the last  market
                               trading  day prior to the time of  determination,
                               as  reported  in The Wall  Street  Journal or any
                               other  source  as  the  Administrator   considers
                               reliable;
                     (ii)      If the  Common  Stock is  regularly  quoted  by a
                               recognized  securities  dealer but selling prices
                               are not  reported,  its Fair Market Value will be
                               the  mean  between  the  high  bid and low  asked
                               prices  for the Common  Stock on the last  market
                               trading day prior to the day of determination; or
                     (iii)     In the absence of an  established  market for the
                               Common  Stock,  the  Fair  Market  Value  will be
                               determined in good faith by the Administrator.
           (n)       "Incentive  Stock  Option"  means  an  Option  intended  to
                     qualify as an incentive  stock option within the meaning of
                     Section 422 of the Code.
           (o)       "Non-statutory Stock Option" means an Option not intended
                      to qualify as an Incentive Stock Option.
           (p)       "Officer" means a person who is an officer of the Company
                      within the meaning of Section 16 of the Exchange
                     Act and the rules and regulations promulgated thereunder.
           (q)       "Option" means a stock option granted pursuant to the Plan.


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           (r)       "Option Agreement" means a written or electronic  agreement
                     between the Company  and an Optionee  evidencing  the terms
                     and  conditions of an individual  Option grant.  The Option
                     Agreement  is  subject to the terms and  conditions  of the
                     Plan.
           (s)       "Option   Exchange   Program"   means  a  program   whereby
                     outstanding  Options are exchanged for Options with a lower
                     exercise price.
           (t)       "Optioned Stock" means the Common Stock subject to an
                     Option or a Stock Purchase Right.
           (u)       "Optionee" means the holder of an outstanding Option or
                     Stock Purchase Right granted under the Plan.
           (v)       "Parent" means a "parent corporation," whether now or
                     hereafter existing, as defined in Section 424(e) of the
                     Code.
           (w)       "Plan" means this 2000 Stock Plan.
           (x)       "Restricted  Stock" means  shares of Common Stock  acquired
                     pursuant to a grant of a Stock Purchase Right under Section
                     11 below.
           (y)       "Rule  16b-3"  means Rule 16b-3 of the  Exchange Act or any
                     successor to Rule 16b-3,  as in effect when  discretion  is
                     being exercised with respect to the Plan.
           (z)       "Section 16(b)" means Section 16(b) of the Exchange Act.
           (aa)      "Service Provider" means an Employee, Director or
                     Consultant.
           (bb)      "Share" means a share of the Common Stock, as adjusted
                     under Section 12 below.
           (cc)      "Stock Purchase Right" means a right to purchase Common
                     Stock pursuant to Section 11 below.
           (dd)      "Subsidiary" means a "subsidiary corporation," whether now
                     or hereafter existing, as defined in Section 424(f)
                     of the Code.

3. Stock  Subject to the Plan.  Subject to the  provisions  of Section 12 of the
Plan, the maximum  aggregate  number of Shares that may be subject to option and
sold  under the Plan is  3,000,000  Shares.  The Shares  may be  authorized  but
unissued, or reacquired Common Stock.

If an Option or Stock  Purchase Right expires or becomes  unexercisable  without
having been exercised in full, or is surrendered  pursuant to an Option Exchange
Program,  the  unpurchased  underlying  Shares will become  available for future
grant or sale under the Plan (unless the Plan has terminated).  However,  Shares
that have  actually  been issued under the Plan, on exercise of either an Option
or Stock  Purchase  Right,  will not be returned to the Plan and will not become
available  for  future  distribution  under the Plan,  except  that if Shares of
Restricted  Stock are  repurchased  by the  Company at their  original  purchase
price, the Shares will become available for future grant under the Plan.

4.  Administration of the Plan.

           (a)       Procedure.
                     (i)       Multiple Administrative Bodies. The Plan may be
                               administered by different Committees with respect
                               to different groups of Service Providers.
                     (ii)      Section   162(m).   To  the   extent   that   the
                               Administrator  determines  it to be  desirable to
                               qualify    Options    granted     hereunder    as
                               "performance-based   compensation,"   within  the
                               meaning of Section  162(m) of the Code,  the Plan
                               will be  administered  by a  Committee  of two or
                               more "outside  directors,"  within the meaning of
                               Section 162(m) of the Code.
                     (iii)     Rule 16b-3.  To the extent  desirable  to qualify
                               transactions   hereunder  as  exempt  under  Rule
                               16b-3,  the transactions  contemplated  hereunder
                               will be  structured  to satisfy the  requirements
                               for exemption under Rule 16b-3.
                     (iv)      Other Administration.  Other than as provided
                               above, the Plan will be administered by (A) the
                               Board or (B) a Committee, which committee will be
                               constituted to satisfy Applicable Laws.

           (b)       Powers of the  Administrator.  Subject to the provisions of
                     the Plan  and,  in the case of a  Committee,  the  specific
                     duties delegated by the Board to the Committee, and subject
                     to  the   approval  of  any   relevant   authorities,   the
                     Administrator will have the authority in its discretion:
                     (i)       to determine the Fair Market Value;
                     (ii)      to select the Service Providers to whom Options
                               and Stock Purchase Rights may from time to time
                               be  granted hereunder;
                     (iii)     to  determine the  number of Shares to be covered
                               by  each award granted under the Plan;
                     (iv)      to approve forms of agreement for use  under the
                               Plan;  (v) to determine the terms and conditions,
                               of any Option or Stock Purchase Right granted
                               under the Plan.
                               The terms  and  conditions  include,  but are not
                               limited to, the exercise price, the time or times
                               when  Options  or Stock  Purchase  Rights  may be
                               exercised  (which  may be  based  on  performance
                               criteria),  any vesting acceleration or waiver of
                               forfeiture  restrictions,  and any restriction or
                               limitation regarding any

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                               Option  or Stock  Purchase  Right  or  underlying
                               Common  Stock,  based in each case on the factors
                               as the  Administrator,  in its  sole  discretion,
                               will determine;
                     (vi)      to determine whether and under what circumstances
                               an Option may be settled in cash under subsection
                               9(e) instead of Common Stock;
                     (vii)     to reduce the exercise price of any Option to the
                               then current Fair Market Value if the Fair Market
                               Value of the Common  Stock  covered by the Option
                               has  declined  since  the  date  the  Option  was
                               granted;
                     (viii)    to initiate an Option Exchange Program;
                     (ix)      to   prescribe,   amend  and  rescind  rules  and
                               regulations relating to the Plan, including rules
                               and regulations relating to sub-plans established
                               for the purpose of  qualifying  for preferred tax
                               treatment under foreign tax laws;
                     (x)       to allow  Optionees  to satisfy  withholding  tax
                               obligations  by  electing  to  have  the  Company
                               withhold from the Shares to be issued on exercise
                               of an Option or Stock  Purchase Right that number
                               of Shares having a Fair Market Value equal to the
                               amount  required to be withheld.  The Fair Market
                               Value  of  the  Shares  to be  withheld  will  be
                               determined  on the date that the amount of tax to
                               be withheld is to be determined. All elections by
                               Optionees  to  have  Shares   withheld  for  this
                               purpose  will be made in the form and  under  the
                               conditions  as  the  Administrator  may  consider
                               necessary or advisable; and
                     (xi)      to construe and interpret the terms of the Plan
                               and awards granted pursuant to the Plan.

           (c)       Effect of Administrator's Decision.  All decisions,
                     determinations and interpretations of the Administrator
                     will be final and binding on all Optionees.

5.  Eligibility.

           (a)       Non-statutory Stock Options and Stock Purchase Rights may
                     be granted to Service Providers. Incentive Stock Options
                     may be granted only to Employees.

           (b)       Each Option will be designated  in the Option  Agreement as
                     either an Incentive Stock Option or a  Non-statutory  Stock
                     Option.  However,  notwithstanding the designation,  to the
                     extent that the  aggregate  Fair Market Value of the Shares
                     with  respect  to  which   Incentive   Stock   Options  are
                     exercisable  for the first time by the Optionee  during any
                     calendar  year  (under  all  plans of the  Company  and any
                     Parent or Subsidiary) exceeds $100,000, the Options will be
                     treated as  Non-statutory  Stock  Options.  For purposes of
                     this Section  5(b),  Incentive  Stock Options will be taken
                     into account in the order in which they were  granted.  The
                     Fair Market  Value of the Shares will be  determined  as of
                     the time the Option with respect to the Shares is granted.

           (c)       Neither  the Plan nor any  Option or Stock  Purchase  Right
                     will  confer on any  Optionee  any right  with  respect  to
                     continuing  the  Optionee's   relationship   as  a  Service
                     Provider with the Company, nor will it interfere in any way
                     with his or her right or the  Company's  right to terminate
                     the relationship at any time, with or without cause.

           (d)       The following limitations will apply to grants of Options:
                     (i)       No  Service  Provider  will  be  granted,  in any
                               fiscal year of the  Company,  Options to purchase
                               more than 10% of the total issued and outstanding
                               Shares.
                     (ii)      The  foregoing   limitations   will  be  adjusted
                               proportionately  in connection with any change in
                               the  Company's  capitalization  as  described  in
                               Section 12.
                     (iii)     If an Option is cancelled in the same fiscal year
                               of the  Company  in which it was  granted  (other
                               than in connection  with a transaction  described
                               in Section  12),  the  cancelled  Option  will be
                               counted   against   the   limits   set  forth  in
                               subsections (i) and (ii) above. For this purpose,
                               if the  exercise  price of an Option is  reduced,
                               the transaction will be treated as a cancellation
                               of the Option and the grant of a new Option.

6.  Term of Plan.  The Plan will become effective on its adoption by the Board.
It will continue in effect for a term of ten (10) years unless terminated at an
earlier date under Section 14 of the Plan.

7.  Term of  Option.  The  term of each  Option  will be  stated  in the  Option
Agreement;  provided, however, that the term will be no more than ten (10) years
from the date of grant.  In the case of an Incentive  Stock Option granted to an
Optionee who, at the time the Option is granted,  owns stock  representing  more
than ten  percent  (10%) of the  voting  power  of all  classes  of stock of the
Company or any  Parent or  Subsidiary,  the term of the Option  will be five (5)
years from the date of grant or a shorter  term as may be provided in the Option
Agreement.

8.  Option Exercise Price and Consideration.
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           (a)       Option Exercise Price.  The per share exercise price for
                     the Shares to be issued on exercise of an Option will be
                     the price as is determined by the Administrator, but will
                     be subject to the following:
                     (i)       In the case of an Incentive Stock Option
                               (A)        granted  to an  Employee  who,  at the
                                          time  of  grant  of the  Option,  owns
                                          stock   representing   more  than  ten
                                          percent  (10%) of the voting  power of
                                          all classes of stock of the Company or
                                          any Parent or Subsidiary, the exercise
                                          price will be no less than 110% of the
                                          Fair  Market  Value  per  Share on the
                                          date of grant.
                               (B)        granted to any other Employee, the per
                                          Share  exercise  price will be no less
                                          than 100% of the Fair Market Value per
                                          Share on the date of grant.
                     (ii)      In the case of a Non-statutory  Stock Option, the
                               per Share  exercise  price will be  determined by
                               the Administrator. In the case of a Non-statutory
                               Stock    Option    intended    to    qualify   as
                               "performance-based   compensation"   within   the
                               meaning  of Section  162(m) of the Code,  the per
                               Share exercise price will be no less than 100% of
                               the Fair  Market  Value  per Share on the date of
                               grant.

                     (iii)     Notwithstanding  the  foregoing,  Options  may be
                               granted  with a per Share  exercise  price  other
                               than as  required  above  pursuant to a merger or
                               other corporate transaction.

           (b)       Consideration.  The consideration to be paid for the Shares
                     to be issued on exercise of an Option, including the method
                     of payment,  will be determined by the Administrator  (and,
                     in  the  case  of  an  Incentive  Stock  Option,   will  be
                     determined  at the time of grant).  The  consideration  may
                     consist of:
                     (i)       cash,
                     (ii)      check,
                     (iii)     promissory note,
                     (iv)      other Shares which:
                               (A)        in the  case  of  Shares  acquired  on
                                          exercise of an Option, have been owned
                                          by the  Optionee  for  more  than  six
                                          months on the date of surrender, and
                               (B)        have a Fair  Market  Value on the date
                                          of  surrender  equal to the  aggregate
                                          exercise  price  of the  Shares  as to
                                          which the Option will be exercised,
                     (v)       consideration received by the Company under a
                               cashless exercise program implemented by the
                               Company in connection with the Plan, or
                     (vi)      any combination of the foregoing methods of
                               payment.
                     In making its determination as to the type of consideration
                     to accept, the Administrator will consider if acceptance of
                     the consideration may be reasonably expected to benefit the
                     Company.

9.  Exercise of Option.

           (a)       Procedure for Exercise; Rights as a Shareholder. Any Option
                     granted under the Plan will be exercisable according to the
                     terms  of the  Plan  at the  times,  and  under  any  other
                     conditions as determined by the Administrator and set forth
                     in the Option Agreement.  Unless the Administrator provides
                     otherwise,  vesting of  Options  granted  to  Officers  and
                     Directors  will  be  tolled  during  any  unpaid  leave  of
                     absence. An Option may not be exercised for a fraction of a
                     Share.

                     An Option  will be  considered  exercised  when the Company
                     receives:

                     (i)       written or electronic notice of exercise (under
                               the Option Agreement) from the person entitled to
                               exercise the Option, and
                     (ii) full  payment for the Shares with respect to which the
                     Option  is  exercised.  Full  payment  may  consist  of any
                     consideration  and  method  of  payment  authorized  by the
                     Administrator and permitted by the Option Agreement and the
                     Plan. Shares issued on exercise of an Option will be issued
                     in the  name  of  the  Optionee  or,  if  requested  by the
                     Optionee,  in the  name  of  the  Optionee  and  his or her
                     spouse.  Until the Shares are issued (as  evidenced  by the
                     appropriate  entry on the books of the Company or of a duly
                     authorized transfer agent of the Company), no right to vote
                     or receive  dividends or any other rights as a  shareholder
                     will exist with respect to the Shares,  notwithstanding the
                     exercise of the Option. The Company will issue (or cause to
                     be  issued)  the  Shares   promptly  after  the  Option  is
                     exercised.  No  adjustment  will be made for a dividend  or
                     other  right for which the record date is prior to the date
                     the Shares are issued,  except as provided in Section 12 of
                     the Plan.

                     Exercise  of an  Option  in any  manner  will  result  in a
                     decrease in the number of Shares thereafter available, both
                     for purposes of the Plan and for sale under the Option,  by
                     the number of Shares as to which the Option is exercised.


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          (b)  Termination of Relationship as a Service Provider. If an Optionee
               ceases to be a Service Provider, the Optionee may exercise his or
               her  Option  within  the  period of time as is  specified  in the
               Option  Agreement  to the extent that the Option is vested on the
               date of termination (but in no event later than the expiration of
               the term of the Option as set forth in the Option Agreement).  In
               the  absence of a  specified  time in the Option  Agreement,  the
               Option will remain exercisable for three (3) months following the
               Optionee's  termination.  If,  on the  date of  termination,  the
               Optionee is not vested as to his or her entire Option, the Shares
               covered by the unvested  portion of the Option will revert to the
               Plan. If, after  termination,  the Optionee does not exercise his
               or her Option within the time specified by the Administrator, the
               Option will terminate,  and the Shares covered by the Option will
               revert to the Plan.

          (c)  Disability  of  Optionee.  If an Optionee  ceases to be a Service
               Provider as a result of the Optionee's  Disability,  the Optionee
               may  exercise  his or her Option  within the period of time as is
               specified  in the  Option  Agreement  to the extent the Option is
               vested on the date of termination (but in no event later than the
               expiration  of the term of the  Option as set forth in the Option
               Agreement).  In the  absence  of a  specified  time in the Option
               Agreement,  the Option  will remain  exercisable  for twelve (12)
               months following the Optionee's  termination.  If, on the date of
               termination,  the  Optionee is not vested as to his or her entire
               Option,  the Shares covered by the unvested portion of the Option
               will revert to the Plan. If, after termination, the Optionee does
               not exercise  his or her Option  within the time  specified,  the
               Option will terminate,  and the Shares covered by the Option will
               revert to the Plan.

          (d)  Death of Optionee.  If an Optionee dies while a Service Provider,
               the  Option  may be  exercised  within  the  period of time as is
               specified  in the Option  Agreement to the extent that the Option
               is vested on the date of death  (but in no event  later  than the
               expiration  of the term of the  Option as set forth in the Option
               Agreement) by the  Optionee's  estate or by a person who acquires
               the right to exercise  the Option by bequest or  inheritance.  In
               the  absence of a  specified  time in the Option  Agreement,  the
               Option will remain  exercisable for twelve (12) months  following
               the  Optionee's  termination.  If,  at the  time  of  death,  the
               Optionee  is not  vested  as to the  entire  Option,  the  Shares
               covered by the  unvested  portion of the Option will  immediately
               revert to the Plan. If the Option is not so exercised  within the
               time specified, the Option will terminate, and the Shares covered
               by the Option will revert to the Plan.

          (e)  Buyout Provisions. The Administrator may at any time offer to buy
               out for a  payment  in  cash  or  Shares,  an  Option  previously
               granted,  based on the terms and conditions as the  Administrator
               will  establish and  communicate to the Optionee at the time that
               the offer is made.

10.  Non-Transferability  of Options and Stock Purchase Rights.  The Options and
Stock  Purchase  Rights  may  not  be  sold,  pledged,  assigned,  hypothecated,
transferred,  or disposed of in any manner  other than by will or by the laws of
descent  or  distribution  and may be  exercised,  during  the  lifetime  of the
Optionee, only by the Optionee.

11.  Stock Purchase Rights.

          (a)  Rights to Purchase.  Stock  Purchase  Rights may be issued either
               alone,  in addition  to, or in tandem with other  awards  granted
               under the Plan and/or cash awards made outside of the Plan. After
               the  Administrator  determines  that it will offer Stock Purchase
               Rights  under the Plan,  it will advise the offeree in writing or
               electronically of the terms,  conditions and restrictions related
               to the offer, including the number of Shares that the person will
               be  entitled  to  purchase,  the  price to be paid,  and the time
               within which the person must accept the offer.  The offer will be
               accepted by execution of a Restricted Stock purchase agreement in
               the form determined by the Administrator.

          (b)  Repurchase Option. Unless the Administrator determines otherwise,
               the Restricted Stock purchase  agreement will grant the Company a
               repurchase  option  exercisable  on the voluntary or  involuntary
               termination of the  purchaser's  service with the Company for any
               reason  (including  death or disability).  The purchase price for
               Shares  repurchased  pursuant to the  Restricted  Stock  purchase
               agreement  will be the original  price paid by the  purchaser and
               may be paid by cancellation of any  indebtedness of the purchaser
               to the Company.  The repurchase  option will lapse at the rate as
               the Administrator may determine.

          (c)  Other  Provisions.  The Restricted Stock purchase  agreement will
               contain  any  other  terms,   provisions   and   conditions   not
               inconsistent   with  the  Plan  as  may  be   determined  by  the
               Administrator in its sole discretion.

          (d)  Rights  as a  Shareholder.  Once  the  Stock  Purchase  Right  is
               exercised,  the purchaser will have rights equivalent to those of
               a shareholder and will be a shareholder  when his or her purchase
               is entered on the records


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               of  the  duly  authorized  transfer  agent  of  the  Company.  No
               adjustment  will be made for a dividend  or other right for which
               the record date is prior to the date the Stock  Purchase Right is
               exercised, except as provided in Section 12 of the Plan.

12. Adjustments On Changes in Capitalization, Merger or Asset Sale.

          (a)  Changes in Capitalization.  Subject to any required action by the
               stockholders of the Company, the number of shares of Common Stock
               covered by each  outstanding  Option or Stock Purchase Right, and
               the number of shares of Common  Stock which have been  authorized
               for  issuance  under the Plan but as to which no Options or Stock
               Purchase Rights have yet been granted or which have been returned
               to the Plan on  cancellation  or expiration of an Option or Stock
               Purchase  Right,  as well as the price per share of Common  Stock
               covered by each outstanding  Option or Stock Purchase Right, will
               be  proportionately  adjusted for any increase or decrease in the
               number of issued  shares of Common Stock  resulting  from a stock
               split,  reverse  stock  split,  stock  dividend,  combination  or
               reclassification  of the Common Stock,  or any other  increase or
               decrease in the number of issued shares of Common Stock  effected
               without receipt of consideration  by the Company.  The conversion
               of  any  convertible  securities  of  the  Company  will  not  be
               considered   to  have   been   "effected   without   receipt   of
               consideration."  The adjustment will be made by the Board,  whose
               determination  in  that  respect  will  be  final,   binding  and
               conclusive.  Except  as  expressly  provided  in  this  Plan,  no
               issuance  by the  Company  of  shares of stock of any  class,  or
               securities  convertible  into shares of stock of any class,  will
               affect, and no adjustment will be made to, the number or price of
               shares of Common  Stock  subject  to an Option or Stock  Purchase
               Right.

          (b)  Dissolution  or  Liquidation.   In  the  event  of  the  proposed
               dissolution or liquidation of the Company, the Administrator will
               notify the  Optionee not less than fifteen (15) days prior to the
               proposed  action.  To the  extent  it  has  not  been  previously
               exercised,  the Option or Stock  Purchase  Right  will  terminate
               immediately prior to the consummation of the proposed action.

          (c)  Merger.  In the event of a merger,  sale or reorganization of the
               Company with or into any other  corporation or  corporations or a
               sale of all or  substantially  all of the  assets or  outstanding
               stock  of  the  Company,   in  which  transaction  the  Company's
               stockholders immediately prior to the transaction own immediately
               after the transaction  less than 50% of the equity  securities of
               the surviving  corporation  or its parent,  all Options that have
               not been  terminated  under the Stock Option  Agreement that will
               become vested within 18 months of the closing date of the merger,
               sale or  reorganization  will be  accelerated.  In the event of a
               merger of the  Company  with or into  another  corporation,  each
               outstanding  Option or Stock  Purchase Right may be assumed or an
               equivalent  option or right may be  substituted  by the successor
               corporation   or  a  parent  or   subsidiary   of  the  successor
               corporation.  If, in the event, an Option or Stock Purchase Right
               is not assumed or substituted, the Option or Stock Purchase Right
               will  terminate as of the date of the closing of the merger.  For
               the  purposes  of this  paragraph,  the Option or Stock  Purchase
               Right will be considered  assumed if,  following the merger,  the
               Option or Stock  Purchase  Right confers the right to purchase or
               receive,  for each Share of Optioned  Stock subject to the Option
               or Stock  Purchase  Right  immediately  prior to the merger,  the
               consideration  (whether  stock,  cash,  or  other  securities  or
               property)  received in the merger by holders of Common  Stock for
               each Share held on the effective date of the transaction  (and if
               the holders are  offered a choice of  consideration,  the type of
               consideration  chosen  by  the  holders  of  a  majority  of  the
               outstanding Shares). If the consideration  received in the merger
               is not solely  common stock of the successor  corporation  or its
               Parent,  the Administrator may, with the consent of the successor
               corporation,  provide for the consideration to be received on the
               exercise of the Option or Stock Purchase Right, for each Share of
               Optioned Stock subject to the Option or Stock Purchase  Right, to
               be solely common stock of the successor corporation or its Parent
               equal  in  fair  market  value  to the  per  share  consideration
               received by holders of Common Stock in the merger.

13.  Non-Transferability of Options and Stock Purchase Rights. Unless determined
otherwise by the  Administrator,  an Option or Stock  Purchase  Right may not be
sold, pledged, assigned, hypothecated, transferred, or disposed of in any manner
other  than  by  will  or by the  laws of  descent  or  distribution  and may be
exercised,  during the lifetime of the Optionee,  only by the  Optionee.  If the
Administrator makes an Option or Stock Purchase Right  transferable,  the Option
or Stock Purchase Right will contain all additional  terms and conditions as the
Administrator considers appropriate.

14. Time of Granting Options and Stock Purchase Rights.  The date of grant of an
Option or Stock Purchase Right will, for all purposes,  be the date on which the
Administrator  makes the  determination  granting  the Option or Stock  Purchase
Right,  or any other date as is determined by the  Administrator.  Notice of the
determination  will be given to each Service Provider to whom an Option or Stock
Purchase  Right is so  granted  within a  reasonable  time after the date of the
grant.

15. Amendment and Termination of the Plan.

<PAGE>





          (a)  Amendment  and  Termination.  The  Board  may at any time  amend,
               alter, suspend or terminate the Plan.

          (b)  Shareholder Approval.  The Board will obtain shareholder approval
               of any Plan  amendment to the extent  necessary  and desirable to
               comply with Applicable Laws.

          (c)  Effect of Amendment or  Termination.  No  amendment,  alteration,
               suspension or  termination  of the Plan will impair the rights of
               any  Optionee,  unless  mutually  agreed  otherwise  between  the
               Optionee  and  the  Administrator,  which  agreement  must  be in
               writing and signed by the Optionee  and the Company.  Termination
               of the Plan  will  not  affect  the  Administrator's  ability  to
               exercise the powers granted to it with respect to Options granted
               under the Plan prior to the date of termination.

16.  Conditions On Issuance of Shares.

           (a)       Legal Compliance. Shares will not be issued pursuant to the
                     exercise of an Option unless the exercise of the Option and
                     the  issuance  and  delivery of the Shares will comply with
                     Applicable Laws and will be further subject to the approval
                     of counsel for the Company with respect to such compliance.

           (b)       Investment Representations.  As a condition to the exercise
                     of an Option,  the  Administrator  may  require  the person
                     exercising  the Option to represent and warrant at the time
                     of exercise  that the Shares are being  purchased  only for
                     investment  and without any  present  intention  to sell or
                     distribute the Shares if, in the opinion of counsel for the
                     Company, such a representation is required.

17.  Inability  to Obtain  Authority.  The  inability  of the  Company to obtain
authority  from any  regulatory  body having  jurisdiction,  which  authority is
considered by the Company's  counsel to be necessary to the lawful  issuance and
sale of any Shares the Plan,  will  relieve  the  Company  of any  liability  in
respect of the  failure  to issue or sell the  Shares as to which the  requisite
authority may not have been obtained.

18.  Reservation of Shares.  The Company,  during the term of this Plan, will at
all times  reserve and keep  available a sufficient  number of Shares to satisfy
the requirements of the Plan.

19.  Shareholder  Approval.  The  Plan  will  be  subject  to  approval  by  the
shareholders of the Company within twelve (12) months after the date the Plan is
adopted. Shareholder approval must be obtained in the degree and manner required
under Applicable Laws.



<PAGE>





                      PHAGE THERAPEUTICS INTERNATIONAL INC.
                                 2000 STOCK PLAN

                             STOCK OPTION AGREEMENT

Unless otherwise  defined in this Stock Option  Agreement,  the terms defined in
the 2000 Stock Plan will have the same  defined  meanings  in this Stock  Option
Agreement.

1.  Notice of Stock Option Grant.

           Name:                                "Optionee"
                     --------------------------

The Optionee has been granted an Option to purchase Common Stock of the Company,
subject to the terms and  conditions of the Plan and this Option  Agreement,  as
follows:

           Date of Grant:
                          --------------------------------

           Vesting Commencement Date:                                     "VCD"
                                       -----------------------------------

           Exercise Price per Share:
                                      ----------------------

           Total Number of Shares Granted:                 Number of shares
                                          ----------------
           Total Exercise Price:                          Total Price
                                  ---------------------
           Type of Option:                          X     Incentive Stock Option
                          -----    ---------------------

                         _________________________ Non-statutory Stock Option

           Term/Expiration Date:
                                  ------------------------------------

           Vesting Schedule:

           The vesting  schedule will be determined by the  Administrator in its
           sole discretion.

           Termination Period:

           This Option will be exercisable  for one month after Optionee  ceases
           to be a Service  Provider.  On Optionee's  death or Disability,  this
           Option may be exercised  for one year after  Optionee  ceases to be a
           Service Provider. In no event may Optionee exercise this Option after
           the Term/Expiration Date as provided above.

2.  Agreement.

           1)        Grant of  Option.  The Plan  Administrator  of the  Company
                     grants to the  Optionee  named in the  Notice of Grant (the
                     "Optionee"),  an option  (the  "Option")  to  purchase  the
                     number of Shares set forth in the  Notice of Grant,  at the
                     exercise  price per Share set forth in the  Notice of Grant
                     (the  "Exercise  Price"),  and  subject  to the  terms  and
                     conditions of the Plan, which is incorporated by reference.
                     Subject  to  Section  14(c) of the Plan,  in the event of a
                     conflict  between the terms and  conditions of the Plan and
                     this Option Agreement, the terms and conditions of the Plan
                     will prevail.

                     If designated in the Notice of Grant as an Incentive  Stock
                     Option  ("ISO"),  this  Option is intended to qualify as an
                     Incentive  Stock  Option as defined  in Section  422 of the
                     Code.  Nevertheless,  to the  extent  that it  exceeds  the
                     $100,000 rule of Code Section  422(d),  this Option will be
                     treated as a Non-statutory Stock Option ("NSO").

           2)        Exercise of Option.
                     (i)       Right   to   Exercise.   This   Option   will  be
                               exercisable  during  its term  under the  Vesting
                               Schedule  set out in the Notice of Grant and with
                               the  applicable  provisions  of the Plan and this
                               Option Agreement.
                     (ii)      Method  of   Exercise.   This   Option   will  be
                               exercisable by delivery of an exercise  notice in
                               the form  attached  as  Exhibit A (the  "Exercise
                               Notice")   which  will  state  the   election  to
                               exercise  the  Option,  the number of Shares with
                               respect to which the  Option is being  exercised,
                               and any other representations


<PAGE>





                               and agreements as may be required by the Company.
                               The  Exercise   Notice  will  be  accompanied  by
                               payment of the aggregate Exercise Price as to all
                               Exercised Shares.  This Option will be considered
                               to be  exercised  on receipt by the  Company of a
                               fully executed Exercise Notice accompanied by the
                               aggregate Exercise Price.

                     No Shares  will be issued  pursuant  to the  exercise of an
                     Option  unless the  issuance  and  exercise  complies  with
                     Applicable  Laws.  Assuming  compliance,   for  income  tax
                     purposes the Shares will be considered  transferred  to the
                     Optionee on the date on which the Option is exercised  with
                     respect to the Shares.

3. Optionee's Representations.  In the event the Shares have not been registered
under  the  Securities  Act of 1933,  as  amended,  at the time  this  Option is
exercised, the Optionee will, if required by the Company,  concurrently with the
exercise of all or any portion of this Option, deliver to the Company his or her
Investment Representation Statement in the form attached hereto as Exhibit B.

4. Lock-Up  Period.  Optionee hereby agrees that, if so requested by the Company
or any  representative  of the  underwriters  (the  "Managing  Underwriter")  in
connection  with any  registration  of the  offering  of any  securities  of the
Company under the Securities Act,  Optionee will not sell or otherwise  transfer
any Shares or other securities of the Company during the 180-day period (or such
other  period as may be requested  in writing by the  Managing  Underwriter  and
agreed to in writing by the Company) (the "Market  Standoff  Period")  following
the effective  date of a  registration  statement of the Company filed under the
Securities  Act.  Such  restriction  will apply  only to the first  registration
statement  of the  Company to become  effective  under the  Securities  Act that
includes  securities  to be sold on behalf of the  Company  to the  public in an
underwritten  public  offering under the Securities  Act. The Company may impose
stop-transfer  instructions with respect to securities  subject to the foregoing
restrictions until the end of such Market Standoff Period.

5. Method of Payment.  Payment of the aggregate Exercise Price will be by any of
the  following,  or a  combination  of the  following,  at the  election  of the
Optionee:

          (a)  cash or check;

          (b)  consideration  received  by the Company  under a formal  cashless
               exercise  program  adopted by the Company in connection  with the
               Plan; or

          (c)  surrender of other Shares which:

               (i)  in the case of Shares  acquired  on  exercise  of an option,
                    have been owned by the Optionee for more than six (6) months
                    on the date of surrender, and

               (ii) have a Fair Market Value on the date of  surrender  equal to
                    the aggregate Exercise Price of the Exercised Shares.

6. Restrictions on Exercise. This Option may not be exercised until such time as
the  Plan  has been  approved  by the  shareholders  of the  Company,  or if the
issuance of the Shares on the exercise or the method of payment of consideration
for the shares would constitute a violation of any Applicable Law.

7.  Non-Transferability  of Option.  This Option may not be  transferred  in any
manner  otherwise than by will or by the laws of descent or distribution and may
be exercised during the lifetime of Optionee only by Optionee.  The terms of the
Plan and this Option Agreement will be binding on the executors, administrators,
heirs, successors and assigns of the Optionee.

8. Term of Option.  This Option may be exercised only within the term set out in
the Notice of Grant,  and may be  exercised  during the term only under the Plan
and the terms of this Option.

9. Tax  Consequences.  Set forth below is a brief summary as of the date of this
Option of some of the  federal tax  consequences  of exercise of this Option and
disposition of the Shares. THIS SUMMARY IS NECESSARILY  INCOMPLETE,  AND THE TAX
LAWS AND  REGULATIONS  ARE SUBJECT TO CHANGE.  THE OPTIONEE SHOULD CONSULT A TAX
ADVISER BEFORE EXERCISING THIS OPTION OR DISPOSING OF THE SHARES.

           (a)       Exercise of NSO. There may be a regular  federal income tax
                     liability on the  exercise of an NSO. The Optionee  will be
                     treated as having received  compensation income (taxable at
                     ordinary income tax rates) equal to the excess,  if any, of
                     the Fair Market Value of the Shares on the date of exercise
                     over the  Exercise  Price.  If Optionee is an Employee or a
                     former  Employee,  the Company will be required to withhold
                     from  Optionee's  compensation or collect from Optionee and
                     pay to the applicable taxing  authorities an amount in cash
                     equal to a percentage of


<PAGE>





                     this compensation  income at the time of exercise,  and may
                     refuse to honor the exercise  and refuse to deliver  Shares
                     if the withholding amounts are not delivered at the time of
                     exercise.

               (b)  Exercise of ISO. If this Option  qualifies as an ISO,  there
                    will be no  regular  federal  income  tax  liability  on the
                    exercise of the Option,  although the excess, if any, of the
                    Fair Market Value of the Shares on the date of exercise over
                    the Exercise  Price will be treated as an  adjustment to the
                    alternative  minimum tax for federal  tax  purposes  and may
                    subject the Optionee to the  alternative  minimum tax in the
                    year of exercise.

               (c)  Disposition of Shares.  In the case of an NSO, if Shares are
                    held  for not less  than one  year,  any  gain  realized  on
                    disposition  of the  Shares  will be  treated  as  long-term
                    capital gain for federal income tax purposes. In the case of
                    an ISO,  if Shares  transferred  pursuant  to the Option are
                    held for not less than one year  after  exercise  and of not
                    less  than  two  years  after  the Date of  Grant,  any gain
                    realized on  disposition  of the Shares will also be treated
                    as long-term  capital gain for federal  income tax purposes.
                    If Shares  purchased under an ISO are disposed of within one
                    year after  exercise  or two years  after the Date of Grant,
                    any gain  realized  on such  disposition  will be treated as
                    compensation  income  (taxable at ordinary  income rates) to
                    the extent of the difference  between the Exercise Price and
                    the lesser of:

                    (i)  the  Fair  Market  Value of the  Shares  on the date of
                         exercise, or

                    (ii) the sale price of the Shares.  Any additional gain will
                         be taxed  as  capital  gain,  short-term  or  long-term
                         depending on the period that the ISO Shares were held.

               (d)  Notice of  Disqualifying  Disposition of ISO Shares.  If the
                    Option  granted to Optionee is an ISO, and if Optionee sells
                    or otherwise disposes of any of the Shares acquired pursuant
                    to the ISO on or before the later of:

                    (i)  the date two years after the Date of Grant, or

                    (ii) the date  one year  after  the  date of  exercise,  the
                         Optionee will immediately notify the Company in writing
                         of such disposition.  Optionee agrees that Optionee may
                         be subject to income tax  withholding by the Company on
                         the compensation income recognized by the Optionee.

10. Entire Agreement;  Governing Law. The Plan is incorporated by reference. The
Plan and this Option  Agreement  constitute the entire  agreement of the parties
and supersede in their  entirety all prior  undertakings  and  agreements of the
Company and Optionee with respect to Options and Stock Purchase Rights,  and may
not be  modified  adversely  to the  Optionee's  interest  except  by means of a
writing  signed by the Company and Optionee.  This  agreement is governed by the
internal substantive laws but not the choice of law rules of Florida.

11. No Guarantee of Continued Service. OPTIONEE ACKNOWLEDGES AND AGREES THAT THE
VESTING OF SHARES PURSUANT TO THE APPLICABLE  VESTING SCHEDULE IS EARNED ONLY BY
CONTINUING AS A SERVICE PROVIDER AT THE WILL OF THE COMPANY (NOT THROUGH THE ACT
OF BEING  HIRED,  BEING  GRANTED  THIS OPTION OR  ACQUIRING  SHARES  HEREUNDER).
OPTIONEE FURTHER  ACKNOWLEDGES AND AGREES THAT THIS AGREEMENT,  THE TRANSACTIONS
CONTEMPLATED  HEREUNDER AND THE ATTACHED  VESTING  SCHEDULE DO NOT CONSTITUTE AN
EXPRESS OR IMPLIED PROMISE OF CONTINUED ENGAGEMENT AS A SERVICE PROVIDER FOR THE
VESTING  PERIOD,  FOR ANY PERIOD,  OR AT ALL, AND WILL NOT  INTERFERE IN ANY WAY
WITH  OPTIONEE'S   RIGHT  OR  THE  COMPANY'S   RIGHT  TO  TERMINATE   OPTIONEE'S
RELATIONSHIP AS A SERVICE PROVIDER AT ANY TIME, WITH OR WITHOUT CAUSE.

Optionee  acknowledges  receipt of a copy of the Plan and represents  that he or
she is familiar  with the terms and  provisions  of the Plan,  and accepts  this
Option  subject to all of the terms and  provisions  of the Plan.  Optionee  has
reviewed the Plan and this Option in their  entirety,  has had an opportunity to
obtain  the  advice  of  counsel  prior  to  executing  this  Option  and  fully
understands all

<PAGE>





provisions of the Option.  Optionee agrees to accept as binding,  conclusive and
final all decisions or  interpretations  of the  Administrator  on any questions
arising  under the Plan or this Option.  Optionee  further  agrees to notify the
Company on any change in the residence address indicated below.


OPTIONEE:                              PHAGE THERAPEUTICS INTERNATIONAL INC.

---------------------------------      ---------------------------------
Signature                              By: _____________________

                                       ________________________
------------------------------------
Print Name                             Title
---------------------------------
Social Security Number

Residential Address:





--------------------------------------------------------------------------------


                                CONSENT OF SPOUSE

The  undersigned  spouse  of  Optionee  has  read and  approves  the  terms  and
conditions  of the Plan and  this  Option  Agreement.  In  consideration  of the
Company's  granting his or her spouse the right to purchase  Shares as set forth
in the Plan and this Option Agreement,  the undersigned agrees to be irrevocably
bound by the terms and  conditions  of the Plan and this  Option  Agreement  and
further agrees that any community property interest will be similarly bound. The
undersigned  appoints  the  undersigned's  spouse  as  attorney-in-fact  for the
undersigned  with respect to any  amendment or exercise of rights under the Plan
or this Option Agreement.



---------------------------------
Spouse of Optionee




<PAGE>





                                    EXHIBIT A

                                 2000 STOCK PLAN

                                 EXERCISE NOTICE



Phage Therapeutics International, Inc.
22116 23rd Drive S.E.
Bothwll, Washington 98201



           1. Exercise of Option. Effective as of today, ___________,  20__, the
undersigned  ("Optionee")  elects to  exercise  Optionee's  option  to  purchase
_________  shares of the  Common  Stock  (the  "Shares")  of Phage  Therapeutics
Interntational  Inc. (the  "Company")  under and pursuant to the 2000 stock plan
(the "Plan") and the stock option  agreement dated  ________,  20__ (the "Option
Agreement"). The purchase price for the Shares will be $________, as required by
the Option Agreement.

           2.  Delivery of Payment.  Purchaser has delivered to the Company the
full purchase price of the Shares.

           3.  Representations of Optionee.  Optionee acknowledges that Optionee
has received, read and understood the Plan and the Option Agreement and agrees
to abide by and be bound by their terms and conditions.

           4.  Rights as  Shareholder.  Until the  issuance  of the  Shares  (as
evidenced  by the  appropriate  entry on the books of the  Company  or of a duly
authorized transfer agent of the Company), no right to vote or receive dividends
or any other  rights as a  shareholder  will exist with  respect to the Optioned
Stock,  notwithstanding the exercise of the Option. The Shares will be issued to
the Optionee as soon as practicable after the Option is exercised. No adjustment
will be made for a dividend or other right for which the record date is prior to
the date of issuance except as provided in Section 12 of the Plan.

           5. Tax  Consultation.  Optionee  understands that Optionee may suffer
adverse tax  consequences  as a result of Optionee's  purchase or disposition of
the  Shares.  Optionee  represents  that  Optionee  has  consulted  with any tax
consultants  Optionee  considers  advisable in  connection  with the purchase or
disposition  of the Shares and that  Optionee  is not relying on the Company for
any tax advice.

           6.  Restrictive Legends and Stop-Transfer Orders.

           (a)       Legends.  Optionee  understands and agrees that the Company
                     will  cause  the   legends   set  forth  below  or  legends
                     substantially  equivalent  thereto,  to be  placed  on  any
                     certificate(s)  evidencing ownership of the Shares together
                     with any other  legends that may be required by the Company
                     or by state or federal securities laws:

                               THE SECURITIES  REPRESENTED  HEREBY HAVE NOT BEEN
                               REGISTERED  UNDER THE SECURITIES ACT OF 1933 (THE
                               "ACT") AND MAY NOT BE OFFERED,  SOLD OR OTHERWISE
                               TRANSFERRED,  PLEDGED OR HYPOTHECATED  UNLESS AND
                               UNTIL REGISTERED UNDER THE ACT OR, IN THE OPINION
                               OF COMPANY COUNSEL  SATISFACTORY TO THE ISSUER OF
                               THESE  SECURITIES,  SUCH OFFER, SALE OR TRANSFER,
                               PLEDGE   OR   HYPOTHECATION   IS  IN   COMPLIANCE
                               THEREWITH.

           (b)       Stop-Transfer  Notices.  Optionee  agrees that, in order to
                     ensure compliance with the restrictions referred to herein,
                     the  Company   may  issue   appropriate   "stop   transfer"
                     instructions  to its transfer  agent,  if any, and that, if
                     the  Company  transfers  its own  securities,  it may  make
                     appropriate  notations  to  the  same  effect  in  its  own
                     records.

           (c)       Refusal to Transfer.  The Company will not be required:
                      (i)      to transfer on its books any Shares that have
                               been sold or otherwise transferred in violation
                               of any of the provisions of this Exercise Notice
                               or
                     (ii)      to treat as owner of such Shares or to accord the
                               right to vote or pay  dividends to any  purchaser
                               or other transferee to whom such Shares will have
                               been so transferred.


<PAGE>





           8.  Successors and Assigns.  The Company may assign any of its rights
under this Exercise  Notice to single or multiple  assignees,  and this Exercise
Notice shall inure to the benefit of the  successors and assigns of the Company.
Subject to the  restrictions on transfer herein set forth,  this Exercise Notice
shall be binding on Optionee  and his or her heirs,  executors,  administrators,
successors and assigns.

     9.  Interpretation.  Any  dispute  regarding  the  interpretation  of  this
Exercise  Notice will be submitted by Optionee or by the Company  immediately to
the Administrator which will review the dispute at its next regular meeting. The
resolution  of a dispute by the  Administrator  will be final and binding on all
parties.

           10. Entire Agreement/Governing Law. The Plan and Option Agreement are
incorporated by reference.  This Exercise Notice, the Plan, the Option Agreement
and the Investment  Representation  Statement constitute the entire agreement of
the parties  concerning Options and Stock Purchase Rights and supersede in their
entirety  all prior  undertakings  and  agreements  of the Company and  Optionee
concerning  Options and Stock Purchase Rights, and may not be modified adversely
to the  Optionee's  interest  except by means of a writing signed by the Company
and Optionee.  This Exercise Notice is governed by the internal substantive laws
but not the choice of law rules, of Florida.


Submitted By:                             Accepted By:

OPTIONEE:                                  PHAGE THERAPEUTICS INTERNATIONAL INC.

---------------------------------         ---------------------------------
Signature                                 By:_______________________

                                          _________________________________
-------------------------------------
Print Name                                Title
---------------------------------
Social Security Number

                                          Date Received: _____________________



<PAGE>





                                    EXHIBIT B

                       INVESTMENT REPRESENTATION STATEMENT



OPTIONEE:
                     -------------------------------------------

COMPANY:                 Phage Therapeutics International Inc.
        ------------------------------------------------------

SECURITY:               Common Stock
                     --------------------------------------------------

AMOUNT:
                     ---------------------------------------

DATE:                _______________________________


In connection with the purchase of the above-listed Securities,  the undersigned
Optionee represents to the Company the following:

1.   Possesses  Knowledge  About  Company.  Optionee  is aware of the  Company's
     business  affairs  and  financial  condition  and has  acquired  sufficient
     information  about  the  Company  to reach an  informed  and  knowledgeable
     decision to acquire the Securities.

2.   Investment  Purpose.  Optionee is acquiring these Securities for investment
     for  Optionee's  own account  only and not with a view to, or for resale in
     connection  with,  any  "distribution"  thereof  within the  meaning of the
     Securities Act of 1933, as amended (the "Securities Act").

3.   Restricted  Securities.  Optionee  acknowledges  and  understands  that the
     Securities constitute "restricted  securities" under the Securities Act and
     have not been registered under the Securities Act in reliance on a specific
     exemption  therefrom,  which exemption depends on, among other things,  the
     bona fide nature of Optionee's  investment  intent as expressed  herein. In
     this connection,  Optionee  understands that, in the view of the Securities
     and Exchange  Commission,  the  statutory  basis for such  exemption may be
     unavailable if Optionee's representation was predicated solely on a present
     intention to hold these  Securities  for the minimum  capital  gains period
     specified under tax statutes, for a deferred sale, for or until an increase
     or decrease in the market price of the  Securities,  or for a period of one
     year or any other fixed period in the future.

4.   Securities  May be Subject to  Indefinite  Hold  Period.  Optionee  further
     understands that the Securities must be held  indefinitely  unless they are
     subsequently  registered under the Securities Act or an exemption from such
     registration is available.  Optionee  further  acknowledges and understands
     that the  Company  is under  no  obligation  to  register  the  Securities.
     Optionee understands that the certificate evidencing the Securities will be
     imprinted  with a legend which  prohibits  the  transfer of the  Securities
     unless they are  registered  or such  registration  is not  required in the
     opinion of counsel  satisfactory to the Company, a legend prohibiting their
     transfer as required under applicable state securities laws.

5.   Rule 701 and Rule 144. Optionee is familiar with the provisions of Rule 701
     and Rule  144,  each  promulgated  under  the  Securities  Act,  which,  in
     substance,   permit  limited  public  resale  of  "restricted   securities"
     acquired,  directly or indirectly from the issuer thereof,  in a non-public
     offering  subject  to the  satisfaction  of  certain  conditions.  Rule 701
     provides  that if the  issuer  qualifies  under Rule 701 at the time of the
     grant of the  Option to the  Optionee,  the  exercise  will be exempt  from
     registration  under the  Securities  Act. In the event the Company  becomes
     subject  to the  reporting  requirements  of  Section  13 or  15(d)  of the
     Securities  Exchange  Act of 1934,  ninety  (90) days  thereafter  (or such
     longer period as any market stand-off agreement may require) the Securities
     exempt under Rule 701 may be resold, subject to the satisfaction of certain
     of the conditions specified by Rule 144, including:

           (a)       the resale  being made  through a broker in an  unsolicited
                     "broker's  transaction" or in transactions  directly with a
                     market maker (as said term is defined under the  Securities
                     Exchange Act of 1934); and, in the case of an affiliate,

           (b)       the availability of certain public information about the
                     Company,

           (c)       the amount of Securities being sold during any three month
                     period not exceeding the limitations specified in
                     Rule 144(e), and

           (d)       the timely filing of a Form 144, if applicable.



<PAGE>





     In the event that the Company  does not qualify  under Rule 701 at the time
     of grant of the  Option,  then the  Securities  may be  resold  in  certain
     limited circumstances subject to the provisions of Rule 144, which requires
     the  resale to occur not less than one year after the later of the date the
     Securities were sold by the Company or the date the Securities were sold by
     an affiliate of the  Company,  within the meaning of Rule 144;  and, in the
     case  of  acquisition   of  the  Securities  by  an  affiliate,   or  by  a
     non-affiliate  who  subsequently  holds the Securities less than two years,
     the  satisfaction of the conditions set forth in sections (a), (b), (c) and
     (d) of the paragraph immediately above.

6.   Other Registration Exemption Not Assured. Optionee further understands that
     in the event all of the applicable  requirements of Rule 701 or 144 are not
     satisfied,   registration   under  the  Securities  Act,   compliance  with
     Regulation A, or some other  registration  exemption will be required;  and
     that,  notwithstanding  the fact that Rules 144 and 701 are not  exclusive,
     the Staff of the  Securities  and Exchange  Commission  has  expressed  its
     opinion that persons proposing to sell private  placement  securities other
     than in a registered  offering and otherwise  than pursuant to Rules 144 or
     701  will  have a  substantial  burden  of proof  in  establishing  that an
     exemption from registration is available for such offers or sales, and that
     such  persons  and  their  respective   brokers  who  participate  in  such
     transactions  do so  at  their  own  risk.  Optionee  understands  that  no
     assurances can be given that any such other registration  exemption will be
     available in such event.


OPTIONEE:

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Signature


Print Name
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Social Security Number