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                                                                    Exhibit 10.7

                                AVIVO CORPORATION

                           1999 EQUITY INCENTIVE PLAN

                         AS ADOPTED ON DECEMBER 15, 1999

      1.    PURPOSE. The purpose of this Plan is to provide incentives to
attract, retain and motivate eligible persons whose present and potential
contributions are important to the success of the Company, its Parent and
Subsidiaries, by offering them an opportunity to participate in the Company's
future performance through awards of Options and Restricted Stock. Capitalized
terms not defined in the text are defined in Section 22 hereof. This Plan is
intended to be a written compensatory benefit plan within the meaning of Rule
701 promulgated under the Securities Act.

      2.    SHARES SUBJECT TO THE PLAN.

2.1   Number of Shares Available. Subject to Sections 2.2 and 17 hereof, the
total number of Shares reserved and available for grant and issuance pursuant to
this Plan will be 705,833 Shares or such lesser number of Shares as permitted
under Section 260.140.45 of Title 10 of the California Code of Regulations.
Subject to Sections 2.2, 5.10 and 17 hereof, Shares subject to Awards previously
granted will again be available for grant and issuance in connection with future
Awards under this Plan to the extent such Shares: (i) cease to be subject to
issuance upon exercise of an Option, other than due to exercise of such Option;
(ii) are subject to an Award granted hereunder but the Shares subject to such
Award are forfeited or repurchased by the Company at the original issue price;
or (iii) are subject to an Award that otherwise terminates without Shares being
issued. At all times the Company will reserve and keep available a sufficient
number of Shares as will be required to satisfy the requirements of all Awards
granted and outstanding under this Plan.

            2.2   Adjustment of Shares. In the event that the number of
outstanding shares of the Company's Common Stock is changed by a stock dividend,
recapitalization, stock split, reverse stock split, subdivision, combination,
reclassification or similar change in the capital structure of the Company
without consideration, then (i) the number of Shares reserved for issuance under
this Plan, (ii) the Exercise Prices of and number of Shares subject to
outstanding Options and (iii) the Purchase Prices of and number of Shares
subject to other outstanding Awards will be proportionately adjusted, subject to
any required action by the Board or the shareholders of the Company and
compliance with applicable securities laws; provided, however, that fractions of
a Share will not be issued but will either be paid in cash at the Fair Market
Value of such fraction of a Share or will be rounded down to the nearest whole
Share, as determined by the Committee.

      3.    ELIGIBILITY. ISOs (as defined in Section 5 hereof) may be granted
only to employees (including officers and directors who are also employees) of
the Company or of a Parent or Subsidiary of the Company. NQSOs (as defined in
Section 5 hereof) and Restricted Stock Awards may be granted to employees,
officers, directors and consultants of the Company or any Parent or Subsidiary
of the Company; provided such consultants render bona fide services

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not in connection with the offer and sale of securities in a capital-raising
transaction. A person may be granted more than one Award under this Plan.

      4.    ADMINISTRATION.

            4.1   Committee Authority. This Plan will be administered by the
Committee or the Board if no Committee is created by the Board. Subject to the
general purposes, terms and conditions of this Plan, and to the direction of the
Board, the Committee will have full power to implement and carry out this Plan.
Without limitation, the Committee will have the authority to:

            (a)   construe and interpret this Plan, any Award Agreement and any
                  other agreement or document executed pursuant to this Plan;

            (b)   prescribe, amend and rescind rules and regulations relating to
                  this Plan;

            (c)   approve persons to receive Awards;

            (d)   determine the form and terms of Awards;

            (e)   determine the number of Shares or other consideration subject
                  to Awards;

            (f)   determine whether Awards will be granted singly, in
                  combination with, in tandem with, in replacement of, or as
                  alternatives to, other Awards under this Plan or awards under
                  any other incentive or compensation plan of the Company or any
                  Parent or Subsidiary of the Company;

            (g)   grant waivers of any conditions of this Plan or any Award;

            (h)   determine the terms of vesting, exercisability and payment of
                  Awards;

            (i)   correct any defect, supply any omission, or reconcile any
                  inconsistency in this Plan, any Award, any Award Agreement,
                  any Exercise Agreement or any Restricted Stock Purchase
                  Agreement;

            (j)   determine whether an Award has been earned;

            (k)   make all other determinations necessary or advisable for the
                  administration of this Plan; and

            (l)   extend the vesting period beyond a Participant's Termination
                  Date.

            4.2   Committee Discretion. Unless in contravention of any express
terms of this Plan or Award, any determination made by the Committee with
respect to any Award will be made in its sole discretion either (i) at the time
of grant of the Award, or (ii) subject to Section 5.9 hereof, at any later time.
Any such determination will be final and binding on the Company and on all
persons having an interest in any Award under this Plan. The Committee may
delegate to one or more officers of the Company the authority to grant an Award
under this Plan, provided such officer or officers are members of the Board.

      5.    OPTIONS. The Committee may grant Options to eligible persons
described in Section 3 hereof and will determine whether such Options will be
Incentive Stock Options within

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the meaning of the Code ("ISOS") or Nonqualified Stock Options ("NQSOS"), the
number of Shares subject to the Option, the Exercise Price of the Option, the
period during which the Option may be exercised, and all other terms and
conditions of the Option, subject to the following:

            5.1   Form of Option Grant. Each Option granted under this Plan will
be evidenced by an Award Agreement which will expressly identify the Option as
an ISO or an NQSO ("STOCK OPTION AGREEMENT"), and will be in such form and
contain such provisions (which need not be the same for each Participant) as the
Committee may from time to time approve, and which will comply with and be
subject to the terms and conditions of this Plan.

            5.2   Date of Grant. The date of grant of an Option will be the date
on which the Committee makes the determination to grant such Option, unless a
later date is otherwise specified by the Committee. The Stock Option Agreement
and a copy of this Plan will be delivered to the Participant within a reasonable
time after the granting of the Option.

            5.3   Exercise Period. Options may be exercisable immediately but
subject to repurchase pursuant to Section 11 hereof or may be exercisable within
the times or upon the events determined by the Committee as set forth in the
Stock Option Agreement governing such Option; provided, however, that no Option
will be exercisable after the expiration of ten (10) years from the date the
Option is granted; and provided further that no ISO granted to a person who
directly or by attribution owns more than ten percent (10%) of the total
combined voting power of all classes of stock of the Company or of any Parent or
Subsidiary of the Company ("TEN PERCENT SHAREHOLDER") will be exercisable after
the expiration of five (5) years from the date the ISO is granted. The Committee
also may provide for Options to become exercisable at one time or from time to
time, periodically or otherwise, in such number of Shares or percentage of
Shares as the Committee determines. Subject to earlier termination of the Option
as provided herein, each Participant who is not an officer, director or
consultant of the Company or of a Parent or Subsidiary of the Company shall have
the right to exercise an Option granted hereunder at the rate of no less than
twenty percent (20%) per year over five (5) years from the date such Option is
granted.

            5.4   Exercise Price. The Exercise Price of an Option will be
determined by the Committee when the Option is granted and may not be less than
eighty-five percent (85%) of the Fair Market Value of the Shares on the date of
grant; provided that (i) the Exercise Price of an ISO will not be less than one
hundred percent (100%) of the Fair Market Value of the Shares on the date of
grant and (ii) the Exercise Price of any Option granted to a Ten Percent
Shareholder will not be less than one hundred ten percent (110%) of the Fair
Market Value of the Shares on the date of grant. Payment for the Shares
purchased must be made in accordance with Section 7 hereof.

            5.5   Method of Exercise. Options may be exercised only by delivery
to the Company of a written stock option exercise agreement (the "EXERCISE
AGREEMENT") in a form approved by the Committee (which need not be the same for
each Participant). The Exercise Agreement will state (i) the number of Shares
being purchased, (ii) the restrictions imposed on the Shares purchased under
such Exercise Agreement, if any, and (iii) such representations and agreements
regarding Participant's investment intent and access to information and other
matters, if any, as may be required or desirable by the Company to comply with
applicable securities laws. Participant shall execute and deliver to the Company
the Exercise Agreement together

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with payment in full of the Exercise Price, and any applicable taxes, for the
number of Shares being purchased.

            5.6   Termination. Subject to earlier termination pursuant to
Sections 17 and 18 hereof and notwithstanding the exercise periods set forth in
the Stock Option Agreement, exercise of an Option will always be subject to the
following:

            (a)   If the Participant is Terminated for any reason other than
                  death, Disability or for Cause, then the Participant may
                  exercise such Participant's Options only to the extent that
                  such Options are exercisable upon the Termination Date or as
                  otherwise determined by the Committee. Such Options must be
                  exercised by the Participant, if at all, as to all or some of
                  the Vested Shares calculated as of the Termination Date or
                  such other date determined by the Committee, within three (3)
                  months after the Termination Date (or within such shorter time
                  period, not less than thirty (30) days, or within such longer
                  time period, not exceeding five (5) years, after the
                  Termination Date as may be determined by the Committee, with
                  any exercise beyond three (3) months after the Termination
                  Date deemed to be an NQSO) but in any event, no later than the
                  expiration date of the Options.

            (b)   If the Participant is Terminated because of Participant's
                  death or Disability (or the Participant dies within three (3)
                  months after a Termination other than for Cause), then
                  Participant's Options may be exercised only to the extent that
                  such Options are exercisable by Participant on the Termination
                  Date or as otherwise determined by the Committee. Such options
                  must be exercised by Participant (or Participant's legal
                  representative or authorized assignee), if at all, as to all
                  or some of the Vested Shares calculated as of the Termination
                  Date or such other date determined by the Committee, within
                  twelve (12) months after the Termination Date (or within such
                  shorter time period, not less than six (6) months, or within
                  such longer time period, not exceeding five (5) years, after
                  the Termination Date as may be determined by the Committee,
                  with any exercise beyond (i) three (3) months after the
                  Termination Date when the Termination is for any reason other
                  than the Participant's death or disability, within the meaning
                  of Section 22(e)(3) of the Code, or (ii) twelve (12) months
                  after the Termination Date when the Termination is for
                  Participant's disability, within the meaning of Section
                  22(e)(3) of the Code, deemed to be an NQSO) but in any event
                  no later than the expiration date of the Options.

            (c)   If the Participant is terminated for Cause, then Participant's
                  Options shall expire on such Participant's Termination Date,
                  or at such later time and on such conditions as are determined
                  by the Committee.

            5.7   Limitations on Exercise. The Committee may specify a
reasonable minimum number of Shares that may be purchased on any exercise of an
Option, provided that such minimum number will not prevent Participant from
exercising the Option for the full number of Shares for which it is then
exercisable.

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            5.8   Limitations on ISOs. The aggregate Fair Market Value
(determined as of the date of grant) of Shares with respect to which ISOs are
exercisable for the first time by a Participant during any calendar year (under
this Plan or under any other incentive stock option plan of the Company or any
Parent or Subsidiary of the Company) will not exceed One Hundred Thousand
Dollars ($100,000). If the Fair Market Value of Shares on the date of grant with
respect to which ISOs are exercisable for the first time by a Participant during
any calendar year exceeds One Hundred Thousand Dollars ($100,000), then the
Options for the first One Hundred Thousand Dollars ($100,000) worth of Shares to
become exercisable in such calendar year will be ISOs and the Options for the
amount in excess of One Hundred Thousand Dollars ($100,000) that become
exercisable in that calendar year will be NQSOs. In the event that the Code or
the regulations promulgated thereunder are amended after the Effective Date (as
defined in Section 18 hereof) to provide for a different limit on the Fair
Market Value of Shares permitted to be subject to ISOs, then such different
limit will be automatically incorporated herein and will apply to any Options
granted after the effective date of such amendment.

            5.9   Modification, Extension or Renewal. The Committee may modify,
extend or renew outstanding Options and authorize the grant of new Options in
substitution therefor, provided that any such action may not, without the
written consent of a Participant, impair any of such Participant's rights under
any Option previously granted. Any outstanding ISO that is modified, extended,
renewed or otherwise altered will be treated in accordance with Section 424(h)
of the Code. Subject to Section 5.10 hereof, the Committee may reduce the
Exercise Price of outstanding Options without the consent of Participants by a
written notice to them; provided, however, that the Exercise Price may not be
reduced below the minimum Exercise Price that would be permitted under Section
5.4 hereof for Options granted on the date the action is taken to reduce the
Exercise Price.

            5.10  No Disqualification. Notwithstanding any other provision in
this Plan, no term of this Plan relating to ISOs will be interpreted, amended or
altered, nor will any discretion or authority granted under this Plan be
exercised, so as to disqualify this Plan under Section 422 of the Code or,
without the consent of the Participant, to disqualify any Participant's ISO
under Section 422 of the Code. In no event shall the total number of Shares
issued (counting each reissuance of a Share that was previously issued and then
forfeited or repurchased by the Company as a separate issuance) under the Plan
upon exercise of ISOs exceed 5,000,000 Shares (adjusted in proportion to any
adjustments under Section 2.2. hereof) over the term of the Plan.

      6.    RESTRICTED STOCK. A Restricted Stock Award is an offer by the
Company to sell to an eligible person Shares that are subject to certain
specified restrictions. The Committee will determine to whom an offer will be
made, the number of Shares the person may purchase, the Purchase Price, the
restrictions to which the Shares will be subject, and all other terms and
conditions of the Restricted Stock Award, subject to the following:

            6.1   Form of Restricted Stock Award. All purchases under a
Restricted Stock Award made pursuant to this Plan will be evidenced by an Award
Agreement ("RESTRICTED STOCK PURCHASE AGREEMENT") that will be in such form
(which need not be the same for each Participant) as the Committee will from
time to time approve, and will comply with and be subject to the terms and
conditions of this Plan. The Restricted Stock Award will be accepted by the
Participant's execution and delivery of the Restricted Stock Purchase Agreement
and full payment for the Shares to the Company within thirty (30) days from the
date the Restricted Stock Purchase Agreement is delivered to the person. If such
person does not execute and deliver the

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Restricted Stock Purchase Agreement along with full payment for the Shares to
the Company within such thirty (30) days, then the offer will terminate, unless
otherwise determined by the Committee.

            6.2   Purchase Price. The Purchase Price of Shares sold pursuant to
a Restricted Stock Award will be determined by the Committee and will be at
least eighty-five percent (85%) of the Fair Market Value of the Shares on the
date the Restricted Stock Award is granted or at the time the purchase is
consummated, except in the case of a sale to a Ten Percent Shareholder, in which
case the Purchase Price will be one hundred percent (100%) of the Fair Market
Value on the date the Restricted Stock Award is granted or at the time the
purchase is consummated. Payment of the Purchase Price must be made in
accordance with Section 7 hereof.

            6.3   Restrictions. Restricted Stock Awards may be subject to the
restrictions set forth in Section 11 hereof or such other restrictions not
inconsistent with Section 25102(o) of the California Corporations Code.

      7.    PAYMENT FOR SHARE PURCHASES.

            7.1   Payment. Payment for Shares purchased pursuant to this Plan
may be made in cash (by check) or, where expressly approved for the Participant
by the Committee and where permitted by law:

            (a)   by cancellation of indebtedness of the Company owed to the
                  Participant;

            (b)   by surrender of shares that: (i) either (A) have been owned by
                  Participant for more than six (6) months and have been paid
                  for within the meaning of SEC Rule 144 (and, if such shares
                  were purchased from the Company by use of a promissory note,
                  such note has been fully paid with respect to such shares) or
                  (B) were obtained by Participant in the public market and (ii)
                  are clear of all liens, claims, encumbrances or security
                  interests;

            (c)   by tender of a full recourse promissory note having such terms
                  as may be approved by the Committee and bearing interest at a
                  rate sufficient to avoid imputation of income under Sections
                  483 and 1274 of the Code; provided, however, that Participants
                  who are not employees or directors of the Company will not be
                  entitled to purchase Shares with a promissory note unless the
                  note is adequately secured by collateral other than the
                  Shares;

            (d)   by waiver of compensation due or accrued to the Participant
                  from the Company for services rendered;

            (e)   with respect only to purchases upon exercise of an Option, and
                  provided that a public market for the Company's stock exists:

                  (i)   through a "same day sale" commitment from the
                        Participant and a broker-dealer that is a member of the
                        National Association of Securities Dealers (an "NASD
                        DEALER") whereby the Participant irrevocably elects to
                        exercise the Option and to sell a portion of the Shares
                        so purchased sufficient to pay the total Exercise Price,
                        and

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                        whereby the NASD Dealer irrevocably commits upon receipt
                        of such Shares to forward the total Exercise Price
                        directly to the Company; or

                  (ii)  through a "margin" commitment from the Participant and
                        an NASD Dealer whereby the Participant irrevocably
                        elects to exercise the Option and to pledge the Shares
                        so purchased to the NASD Dealer in a margin account as
                        security for a loan from the NASD Dealer in the amount
                        of the total Exercise Price, and whereby the NASD Dealer
                        irrevocably commits upon receipt of such Shares to
                        forward the total Exercise Price directly to the
                        Company; or

            (f)   by any combination of the foregoing.

            7.2   Loan Guarantees. The Committee may, in its sole discretion,
elect to assist the Participant in paying for Shares purchased under this Plan
by authorizing a guarantee by the Company of a third-party loan to the
Participant.

      8.    WITHHOLDING TAXES.

            8.1   Withholding Generally. Whenever Shares are to be issued in
satisfaction of Awards granted under this Plan, the Company may require the
Participant to remit to the Company an amount sufficient to satisfy federal,
state and local withholding tax requirements prior to the delivery of any
certificate or certificates for such Shares. Whenever, under this Plan, payments
in satisfaction of Awards are to be made in cash by the Company, such payment
will be net of an amount sufficient to satisfy federal, state, and local
withholding tax requirements.

            8.2   Stock Withholding. When, under applicable tax laws, a
Participant incurs tax liability in connection with the exercise or vesting of
any Award that is subject to tax withholding and the Participant is obligated to
pay the Company the amount required to be withheld, the Committee may in its
sole discretion allow the Participant to satisfy the minimum withholding tax
obligation by electing to have the Company withhold from the Shares to be issued
that minimum number of Shares having a Fair Market Value equal to the minimum
amount required to be withheld, determined on the date that the amount of tax to
be withheld is to be determined; but in no event will the Company withhold
Shares if such withholding would result in adverse accounting consequences to
the Company. All elections by a Participant to have Shares withheld for this
purpose will be made in accordance with the requirements established by the
Committee for such elections and be in writing in a form acceptable to the
Committee.

      9.    PRIVILEGES OF STOCK OWNERSHIP.

            9.1   Voting and Dividends. No Participant will have any of the
rights of a shareholder with respect to any Shares until the Shares are issued
to the Participant. After Shares are issued to the Participant, the Participant
will be a shareholder and have all the rights of a shareholder with respect to
such Shares, including the right to vote and receive all dividends or other
distributions made or paid with respect to such Shares; provided, that if such
Shares are Restricted Stock, then any new, additional or different securities
the Participant may become entitled to receive with respect to such Shares by
virtue of a stock dividend, stock split or any other change in the corporate or
capital structure of the Company will be subject to the same

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restrictions as the Restricted Stock. The Participant will have no right to
retain such stock dividends or stock distributions with respect to Unvested
Shares that are repurchased pursuant to Section 11 hereof. The Company will
comply with Section 260.140.1 of Title 10 of the California Code of Regulations
with respect to the voting rights of Common Stock.

            9.2   Financial Statements. The Company will provide financial
statements to each Participant annually during the period such Participant has
Awards outstanding, or as otherwise required under Section 260.140.46 of Title
10 of the California Code of Regulations. Notwithstanding the foregoing, the
Company will not be required to provide such financial statements to
Participants when issuance is limited to key employees whose services in
connection with the Company assure them access to equivalent information.

      10.   TRANSFERABILITY. Awards granted under this Plan, and any interest
therein, will not be transferable or assignable by Participant, other than by
will or by the laws of descent and distribution, and may not be made subject to
execution, attachment or similar process. During the lifetime of the Participant
an Award will be exercisable only by the Participant or Participant's legal
representative and any elections with respect to an Award may be made only by
the Participant or Participant's legal representative.

      11.   RESTRICTIONS ON SHARES.

            11.1  Right of First Refusal. At the discretion of the Committee,
the Company may reserve to itself and/or its assignee(s) in the Award Agreement
a right of first refusal to purchase all Shares that a Participant (or a
subsequent transferee) may propose to transfer to a third party, unless
otherwise not permitted by Section 25102(o) of the California Corporations Code,
provided that such right of first refusal terminates upon the Company's initial
public offering of Common Stock pursuant to an effective registration statement
filed under the Securities Act.

            11.2  Right of Repurchase. At the discretion of the Committee, the
Company may reserve to itself and/or its assignee(s) in the Award Agreement a
right to repurchase Unvested Shares held by a Participant for cash and/or
cancellation of purchase money indebtedness owed to the Company by the
Participant following such Participant's Termination at any time within the
later of ninety (90) days after the Participant's Termination Date and the date
the Participant purchases Shares under the Plan at the Participant's Exercise
Price or Purchase Price, as the case may be, provided that, unless the
Participant is an officer, director or consultant of the Company or of a Parent
or Subsidiary of the Company, such right of repurchase lapses at the rate of no
less than twenty percent (20%) per year over five (5) years from: (a) the date
of grant of the Option or (b) in the case of Restricted Stock, the date the
Participant purchases the Shares.

      12.   CERTIFICATES. All certificates for Shares or other securities
delivered under this Plan will be subject to such stock transfer orders, legends
and other restrictions as the Committee may deem necessary or advisable,
including restrictions under any applicable federal, state or foreign securities
law, or any rules, regulations and other requirements of the SEC or any stock
exchange or automated quotation system upon which the Shares may be listed or
quoted.

      13.   ESCROW; PLEDGE OF SHARES. To enforce any restrictions on a
Participant's Shares set forth in Section 11 hereof, the Committee may require
the Participant to

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deposit all certificates representing Shares, together with stock powers or
other instruments of transfer approved by the Committee, appropriately endorsed
in blank, with the Company or an agent designated by the Company to hold in
escrow until such restrictions have lapsed or terminated. The Committee may
cause a legend or legends referencing such restrictions to be placed on the
certificates. Any Participant who is permitted to execute a promissory note as
partial or full consideration for the purchase of Shares under this Plan will be
required to pledge and deposit with the Company all or part of the Shares so
purchased as collateral to secure the payment of Participant's obligation to the
Company under the promissory note; provided, however, that the Committee may
require or accept other or additional forms of collateral to secure the payment
of such obligation and, in any event, the Company will have full recourse
against the Participant under the promissory note notwithstanding any pledge of
the Participant's Shares or other collateral. In connection with any pledge of
the Shares, Participant will be required to execute and deliver a written pledge
agreement in such form as the Committee will from time to time approve.

      14.   EXCHANGE AND BUYOUT OF AWARDS. The Committee may, at any time or
from time to time, authorize the Company, with the consent of the respective
Participants, to issue new Awards in exchange for the surrender and cancellation
of any or all outstanding Awards. The Committee may at any time buy from a
Participant an Award previously granted with payment in cash, shares of Common
Stock of the Company (including Restricted Stock) or other consideration, based
on such terms and conditions as the Committee and the Participant may agree.

      15.   SECURITIES LAW AND OTHER REGULATORY COMPLIANCE. This Plan is
intended to comply with Section 25102(o) of the California Corporations Code.
Any provision of this Plan which is inconsistent with Section 25102(o) shall,
without further act or amendment by the Company or the Board, be reformed to
comply with the requirements of Section 25102(o). An Award will not be effective
unless such Award is in compliance with all applicable federal and state
securities laws, rules and regulations of any governmental body, and the
requirements of any stock exchange or automated quotation system upon which the
Shares may then be listed or quoted, as they are in effect on the date of grant
of the Award and also on the date of exercise or other issuance. Notwithstanding
any other provision in this Plan, the Company will have no obligation to issue
or deliver certificates for Shares under this Plan prior to (i) obtaining any
approvals from governmental agencies that the Company determines are necessary
or advisable, and/or (ii) compliance with any exemption, completion of any
registration or other qualification of such Shares under any state or federal
law or ruling of any governmental body that the Company determines to be
necessary or advisable. The Company will be under no obligation to register the
Shares with the SEC or to effect compliance with the exemption, registration,
qualification or listing requirements of any state securities laws, stock
exchange or automated quotation system, and the Company will have no liability
for any inability or failure to do so.

      16.   NO OBLIGATION TO EMPLOY. Nothing in this Plan or any Award granted
under this Plan will confer or be deemed to confer on any Participant any right
to continue in the employ of, or to continue any other relationship with, the
Company or any Parent or Subsidiary of the Company or limit in any way the right
of the Company or any Parent or Subsidiary of the Company to terminate
Participant's employment or other relationship at any time, with or without
Cause.

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      17.   CORPORATE TRANSACTIONS.

            17.1  Change in Control. In the event of (i) a dissolution or
liquidation of the Company, (ii) a merger or consolidation in which the Company
is not the surviving corporation (other than a merger or consolidation with a
wholly-owned subsidiary, a reincorporation of the Company in a different
jurisdiction, or other transaction in which there is no substantial change in
the shareholders of the Company or their relative stock holdings and the Awards
granted under this Plan are assumed, converted or replaced by the successor or
acquiring corporation, which assumption, conversion or replacement will be
binding on all Participants), (iii) a merger in which the Company is the
surviving corporation but after which the shareholders of the Company
immediately prior to such merger (other than any shareholder which merges with
the Company in such merger, or which owns or controls another corporation which
merges with the Company in such merger) cease to own their shares or other
equity interests in the Company, or (iv) the sale of all or substantially all of
the assets of the Company (each of the above events constitute a "Change of
Control Transaction"), then, with respect to each Award held by a Participant
which is outstanding immediately prior to such Change of Control Transaction and
which is not then vested with respect to any Shares and which does not vest
based upon satisfaction of performance criteria, unless the Award specifies
otherwise, effective immediately prior to such Change of Control Transaction
(the "Vesting Adjustment Date"), such Award shall be deemed as having vested
from the vesting commencement date until the Vesting Adjustment Date, and shall
continue to vest following the Vesting Adjustment Date and otherwise in
accordance with the terms and conditions of the Award (such as, if applicable,
subject to Participant continuing to provide services to the Company or any
Subsidiary or Parent of the Company), as to 2.0833% of the Shares subject to
such Award for each full month following the vesting commencement date, until
the Award is vested as to 100% of the Shares subject to such Award. If the
application of the accelerated vesting or monthly percentage vesting upon such
Change of Control Transaction causes a fractional share, such share shall be
rounded down to the nearest whole share for each such period except for the last
month of the vesting period of the Award, at the end of which the Award shall
vest as to the full remainder of the Shares. In the event of a Change of Control
Transaction, any and all outstanding Awards may be (i) assumed, converted or
replaced by the successor or acquiring corporation (if any), which assumption,
conversion or replacement will be binding on all Participants. In the
alternative, the successor or acquiring corporation may substitute equivalent
Awards or provide substantially similar consideration to Participants as was
provided to shareholders (after taking into account the existing provisions of
the Awards). The successor or acquiring corporation may also substitute by
issuing, in place of outstanding Shares of the Company held by the Participant,
substantially similar shares or other property subject to repurchase
restrictions and other provisions no less favorable to the Participant than
those which applied to such outstanding Shares immediately prior to such Change
of Control Transaction described in this Section 17.1.

            17.2  Other Treatment of Awards. Subject to any greater rights
granted to Participants under the foregoing provisions of this Section 17, in
the event of the occurrence of any transaction described in Section 17.1 hereof,
any outstanding Awards will be treated as provided in the applicable agreement
or plan of merger, consolidation, dissolution, liquidation or sale of assets.

            17.3  Assumption of Awards by the Company. The Company, from time to
time, also may substitute or assume outstanding awards granted by another
company, whether in connection with an acquisition of such other company or
otherwise, by either (i) granting an

                                       10
<PAGE>

Award under this Plan in substitution of such other company's award or (ii)
assuming such award as if it had been granted under this Plan if the terms of
such assumed award could be applied to an Award granted under this Plan. Such
substitution or assumption will be permissible if the holder of the substituted
or assumed award would have been eligible to be granted an Award under this Plan
if the other company had applied the rules of this Plan to such grant. In the
event the Company assumes an award granted by another company, the terms and
conditions of such award will remain unchanged (except that the exercise price
and the number and nature of shares issuable upon exercise of any such option
will be adjusted appropriately pursuant to Section 424(a) of the Code). In the
event the Company elects to grant a new Option rather than assuming an existing
option, such new Option may be granted with a similarly adjusted Exercise Price.

      18.   ADOPTION AND SHAREHOLDER APPROVAL. This Plan will become effective
on the date that it is adopted by the Board (the "EFFECTIVE DATE"). This Plan
will be approved by the shareholders of the Company (excluding Shares issued
pursuant to this Plan), consistent with applicable laws, within twelve (12)
months before or after the Effective Date. Upon the Effective Date, the Board
may grant Awards pursuant to this Plan; provided, however, that: (i) no Option
may be exercised prior to initial shareholder approval of this Plan; (ii) no
Option granted pursuant to an increase in the number of Shares approved by the
Board shall be exercised prior to the time such increase has been approved by
the shareholders of the Company; (iii) in the event that initial shareholder
approval is not obtained within the time period provided herein, all Awards
granted hereunder shall be canceled, any Shares issued pursuant to any Award
shall be canceled and any purchase of Shares issued hereunder shall be
rescinded; and (iv) Awards granted pursuant to an increase in the number of
Shares approved by the Board which increase is not timely approved by
shareholders shall be canceled, any Shares issued pursuant to any such Awards
shall be canceled, and any purchase of Shares subject to any such Award shall be
rescinded.

      19.   TERM OF PLAN/GOVERNING LAW. Unless earlier terminated as provided
herein, this Plan will terminate ten (10) years from the Effective Date or, if
earlier, the date of shareholder approval. This Plan and all agreements
hereunder shall be governed by and construed in accordance with the laws of the
State of California.

      20.   AMENDMENT OR TERMINATION OF PLAN. Subject to Section 5.9 hereof, the
Board may at any time terminate or amend this Plan in any respect, including
without limitation amendment of any form of Award Agreement or instrument to be
executed pursuant to this Plan; provided, however, that the Board will not,
without the approval of the shareholders of the Company, amend this Plan in any
manner that requires such shareholder approval pursuant to Section 25102(o) of
the California Corporations Code or the Code or the regulations promulgated
thereunder as such provisions apply to ISO plans.

      21.   NONEXCLUSIVITY OF THE PLAN. Neither the adoption of this Plan by the
Board, the submission of this Plan to the shareholders of the Company for
approval, nor any provision of this Plan will be construed as creating any
limitations on the power of the Board to adopt such additional compensation
arrangements as it may deem desirable, including, without limitation, the
granting of stock options and other equity awards otherwise than under this
Plan, and such arrangements may be either generally applicable or applicable
only in specific cases.

      22.   DEFINITIONS. As used in this Plan, the following terms will have the
following meanings:

                                       11
<PAGE>

            "AWARD" means any award under this Plan, including any Option or
Restricted Stock Award.

            "AWARD AGREEMENT" means, with respect to each Award, the signed
written agreement between the Company and the Participant setting forth the
terms and conditions of the Award, including the Stock Option Agreement and
Restricted Stock Agreement.

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

            "CAUSE" means Termination because of (i) any willful, material
violation by the Participant of any law or regulation applicable to the business
of the Company or a Parent or Subsidiary of the Company, the Participant's
conviction for, or guilty plea to, a felony or a crime involving moral
turpitude, or any willful perpetration by the Participant of a common law fraud,
(ii) the Participant's commission of an act of personal dishonesty which
involves personal profit in connection with the Company or any other entity
having a business relationship with the Company, (iii) any material breach by
the Participant of any provision of any agreement or understanding between the
Company or any Parent or Subsidiary of the Company and the Participant regarding
the terms of the Participant's service as an employee, officer, director or
consultant to the Company or a Parent or Subsidiary of the Company, including
without limitation, the willful and continued failure or refusal of the
Participant to perform the material duties required of such Participant as an
employee, officer, director or consultant of the Company or a Parent or
Subsidiary of the Company, other than as a result of having a Disability, or a
breach of any applicable invention assignment and confidentiality agreement or
similar agreement between the Company or a Parent or Subsidiary of the Company
and the Participant, (iv) Participant's disregard of the policies of the Company
or any Parent or Subsidiary of the Company so as to cause loss, damage or injury
to the property, reputation or employees of the Company or a Parent or
Subsidiary of the Company, or (v) any other misconduct by the Participant which
is materially injurious to the financial condition or business reputation of, or
is otherwise materially injurious to, the Company or a Parent or Subsidiary of
the Company.

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

            "COMMITTEE" means the committee created and appointed by the Board
to administer this Plan, or if no committee is created and appointed, the Board.

            "COMPANY" means Avivo Corporation, or any successor corporation.

            "DISABILITY" means a disability, whether temporary or permanent,
partial or total, as determined by the Committee.

            "EXERCISE PRICE" means the price at which a holder of an Option may
purchase the Shares issuable upon exercise of the Option.

            "FAIR MARKET VALUE" means, as of any date, the value of a share of
the Company's Common Stock determined as follows:

            (a)   if such Common Stock is then quoted on the Nasdaq National
                  Market, its closing price on the Nasdaq National Market on the
                  date of determination as reported in The Wall Street Journal;

                                       12
<PAGE>

            (b)   if such Common Stock is publicly traded and is then listed on
                  a national securities exchange, its closing price on the date
                  of determination on the principal national securities exchange
                  on which the Common Stock is listed or admitted to trading as
                  reported in The Wall Street Journal;

            (c)   if such Common Stock is publicly traded but is not quoted on
                  the Nasdaq National Market nor listed or admitted to trading
                  on a national securities exchange, the average of the closing
                  bid and asked prices on the date of determination as reported
                  by The Wall Street Journal (or, if not so reported, as
                  otherwise reported by any newspaper or other source as the
                  Board may determine); or

            (d)   if none of the foregoing is applicable, by the Committee in
                  good faith.

            "OPTION" means an award of an option to purchase Shares pursuant to
Section 5 hereof.

            "PARENT" means any corporation (other than the Company) in an
unbroken chain of corporations ending with the Company if each of such
corporations other than the Company owns stock representing fifty percent (50%)
or more of the total combined voting power of all classes of stock in one of the
other corporations in such chain.

            "PARTICIPANT" means a person who receives an Award under this Plan.

            "PLAN" means this Avivo Corporation 1999 Equity Incentive Plan, as
amended from time to time.

            "PURCHASE PRICE" means the price at which a Participant may purchase
Restricted Stock.

            "RESTRICTED STOCK" means Shares purchased pursuant to a Restricted
Stock Award.

            "RESTRICTED STOCK AWARD" means an award of Shares pursuant to
Section 6 hereof.

            "SEC" means the Securities and Exchange Commission.

            "SECURITIES ACT" means the Securities Act of 1933, as amended.

            "SHARES" means shares of the Company's Common Stock reserved for
issuance under this Plan, as adjusted pursuant to Sections 2 and 17 hereof, and
any successor security.

            "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
representing fifty percent (50%) or more of the total combined voting power of
all classes of stock in one of the other corporations in such chain.

            "TERMINATION" or "TERMINATED" means, for purposes of this Plan with
respect to a Participant, that the Participant has for any reason ceased to
provide services as an employee, officer, director or consultant to the Company
or a Parent or Subsidiary of the Company. A Participant will not be deemed to
have ceased to provide services in the case of (i) sick leave, (ii)

                                       13
<PAGE>

military leave, or (iii) any other leave of absence approved by the Committee,
provided that such leave is for a period of not more than ninety (90) days (a)
unless reinstatement (or, in the case of an employee with an ISO, reemployment)
upon the expiration of such leave is guaranteed by contract or statute, or (b)
unless provided otherwise pursuant to formal policy adopted from time to time by
the Company's Board and issued and promulgated in writing. In the case of any
Participant on (i) sick leave, (ii) military leave or (iii) an approved leave of
absence, the Committee may make such provisions respecting suspension of vesting
of the Award while on leave from the Company or a Parent or Subsidiary of the
Company as it may deem appropriate, except that in no event may an Option be
exercised after the expiration of the term set forth in the Stock Option
Agreement. The Committee will have sole discretion to determine whether a
Participant has ceased to provide services and the effective date on which the
Participant ceased to provide services (the "TERMINATION DATE").

            "UNVESTED SHARES" means "Unvested Shares" as defined in the Award
Agreement.

            "VESTED SHARES" means "Vested Shares" as defined in the Award
Agreement.

                                       14
<PAGE>

                                                                    NO._________

                                AVIVO CORPORATION

                           1999 EQUITY INCENTIVE PLAN

                             STOCK OPTION AGREEMENT

            This Stock Option Agreement (the "AGREEMENT") is made and entered
into as of the date of grant set forth below (the "DATE OF GRANT") by and
between Avivo Corporation, a California corporation (the "Company"), and the
participant named below (the "PARTICIPANT"). Capitalized terms not defined
herein shall have the meaning ascribed to them in the Company's 1999 Equity
Incentive Plan (the "PLAN").

PARTICIPANT:              [First_Name] [Last_Name]

SOCIAL SECURITY NUMBER:   [SSN]

ADDRESS:                  [Address]

                          [City], [ST] [Zip_Code]

TOTAL OPTION SHARES:      _____________________________________________________

EXERCISE PRICE PER SHARE: _____________________________________________________

DATE OF GRANT:            _____________________________________________________

FIRST VESTING DATE:       _____________________________________________________

EXPIRATION DATE:          _____________________________________________________
                          (unless earlier terminated under Section 5.6 of the
                          Plan)
TYPE OF STOCK OPTION

(CHECK ONE):              [ ] INCENTIVE STOCK OPTION

                          [ ] NONQUALIFIED STOCK OPTION

            1.    GRANT OF OPTION. The Company hereby grants to Participant an
option (this "OPTION") to purchase the total number of shares of Common Stock of
the Company set forth above as Total Option Shares (the "SHARES") at the
Exercise Price Per Share set forth above (the "EXERCISE PRICE"), subject to all
of the terms and conditions of this Agreement and the Plan. If designated as an
Incentive Stock Option above, the Option is intended to qualify as an "incentive
stock option" (the "ISO") within the meaning of Section 422 of the Internal
Revenue Code of 1986, as amended (the "CODE").

            2.    EXERCISE PERIOD.

                  2.1   Exercise Period of Option. This Option is immediately
exercisable although the Shares issued upon exercise of the Option will be
subject to the restrictions on transfer and Repurchase Options set forth in
Sections 7, 8 and 9 below. Provided Participant continues to provide services to
the Company or to any Parent or Subsidiary of the Company, the Shares issuable
upon exercise of this Option will become vested with respect to twenty five
percent (25%) of the Shares on the First Vesting Date set forth on the first
page of this Agreement (the "FIRST VESTING DATE") and thereafter at the end of
each full succeeding month after the First Vesting Date an additional Two and
Eight Hundred Thirty Three Ten Thousandths percent (2.0833%) of the Shares will
become vested until the Shares are vested with respect to one hundred percent
(100%) of the Shares. If application of the vesting percentage causes a
fractional share, such share shall be rounded down to the nearest whole share
for

                                       1
<PAGE>

each month except for the last month in such vesting period, at the end of which
last month this Option shall become vested for the full remainder of the Shares.
Unvested Shares may not be sold or otherwise transferred by Participant without
the Company's prior written consent. Notwithstanding any provision in the Plan
or this Agreement to the contrary, Options for Unvested Shares (as defined in
Section 2.2 of this Agreement) will not be exercisable on or after Participant's
Termination Date.

                  2.2   Vesting of Options. Shares that are vested pursuant to
the schedule set forth in Section 2.1 are "VESTED SHARES." Shares that are not
vested pursuant to the schedule set forth in Section 2.1 are "UNVESTED SHARES."

                  2.3   Expiration. The Option shall expire on the Expiration
Date set forth above or earlier as provided in Section 3 below or pursuant to
Section 5.6 of the Plan.

            3.    TERMINATION.

                  3.1   Termination for Any Reason Except Death, Disability or
Cause. If Participant is Terminated for any reason, except death, Disability or
for Cause, the Option, to the extent (and only to the extent) that it would have
been exercisable by Participant on the Termination Date, may be exercised by
Participant no later than three (3) months after the Termination Date, but in
any event no later than the Expiration Date.

                  3.2   Termination Because of Death or Disability. If
Participant is Terminated because of death or Disability of Participant (or
Participant dies within three (3) months of Termination when Termination is for
any reason other than Participant's Disability or for Cause), the Option, to the
extent that it is exercisable by Participant on the Termination Date, may be
exercised by Participant (or Participant's legal representative) no later than
twelve (12) months after the Termination Date, but in any event no later than
the Expiration Date. Any exercise beyond (i) three (3) months after the
Termination Date when the Termination is for any reason other than the
Participant's death or disability, within the meaning of Section 22(e)(3) of the
Code; or (ii) twelve (12) months after the Termination Date when the termination
is for Participant's disability, within the meaning of Section 22(e)(3) of the
Code, is deemed to be an NQSO.

                  3.3   Termination for Cause. If Participant is Terminated for
Cause, then the Option will expire on Participant's Termination Date, or at such
later time and on such conditions as are determined by the Committee.

                  3.4   No Obligation to Employ. Nothing in the Plan or this
Agreement shall confer on Participant any right to continue in the employ of, or
other relationship with, the Company or any Parent or Subsidiary of the Company,
or limit in any way the right of the Company or any Parent or Subsidiary of the
Company to terminate Participant's employment or other relationship at any time,
with or without Cause.

            4.    MANNER OF EXERCISE.

                  4.1   Stock Option Exercise Agreement. To exercise this
Option, Participant (or in the case of exercise after Participant's death or
incapacity, Participant's executor, administrator, heir or legatee, as the case
may be) must deliver to the Company an executed stock option exercise agreement
in the form attached hereto as Exhibit A, or in such other form as may be
approved by the Committee from time to time (the "EXERCISE AGREEMENT"), which
shall set forth, inter alia, (i) Participant's election to exercise the Option,
(ii) the number of Shares being purchased, (iii) any restrictions imposed on the
Shares and (iv) any representations, warranties and agreements regarding
Participant's investment intent and access to information as may be required by
the Company to comply with applicable securities laws. If someone other than
Participant exercises the Option, then such person must submit documentation
reasonably acceptable to the Company verifying that such person has the legal
right to exercise the Option.

                  4.2   Limitations on Exercise. The Option may not be exercised
unless such exercise is in compliance with all applicable federal and state
securities laws, as they are in effect on the date of exercise.

                                       2
<PAGE>

The Option may not be exercised as to fewer than one hundred (100) Shares unless
it is exercised as to all Shares as to which the Option is then exercisable.

                  4.3   Payment. The Exercise Agreement shall be accompanied by
full payment of the Exercise Price for the shares being purchased in cash (by
check), or where permitted by law:

            (a)   by cancellation of indebtedness of the Company to the
                  Participant;

            (b)   by surrender of shares of the Company's Common Stock that (i)
                  either (A) have been owned by Participant for more than six
                  (6) months and have been paid for within the meaning of SEC
                  Rule 144 (and, if such shares were purchased from the Company
                  by use of a promissory note, such note has been fully paid
                  with respect to such shares); or (B) were obtained by
                  Participant in the open public market; and (ii) are clear of
                  all liens, claims, encumbrances or security interests;

            (c)   by tender of a full recourse promissory note having such terms
                  as may be approved by the Committee and bearing interest at a
                  rate sufficient to avoid imputation of income under Sections
                  483 and 1274 of the Code; provided, however, that Participants
                  who are not employees or directors of the Company shall not be
                  entitled to purchase Shares with a promissory note unless the
                  note is adequately secured by collateral other than the
                  Shares;

            (d)   by waiver of compensation due or accrued to Participant for
                  services rendered;

            (e)   provided that a public market for the Company's stock exists:
                  (i) through a "same day sale" commitment from Participant and
                  a broker-dealer that is a member of the National Association
                  of Securities Dealers (an "NASD Dealer") whereby Participant
                  irrevocably elects to exercise the Option and to sell a
                  portion of the Shares so purchased sufficient to pay for the
                  total Exercise Price and whereby the NASD Dealer irrevocably
                  commits upon receipt of such Shares to forward the total
                  Exercise Price directly to the Company, or (ii) through a
                  "margin" commitment from Participant and an NASD Dealer
                  whereby Participant irrevocably elects to exercise the Option
                  and to pledge the Shares so purchased to the NASD Dealer in a
                  margin account as security for a loan from the NASD Dealer in
                  the amount of the total Exercise Price, and whereby the NASD
                  Dealer irrevocably commits upon receipt of such Shares to
                  forward the total Exercise Price directly to the Company; or

            (f)   any other form of consideration approved by the Committee; or

            (g)   by any combination of the foregoing.

                  4.4   Tax Withholding. Prior to the issuance of the Shares
upon exercise of the Option, Participant must pay or provide for any applicable
federal, state and local withholding obligations of the Company. If the
Committee permits, Participant may provide for payment of withholding taxes upon
exercise of the Option by requesting that the Company retain the minimum number
of Shares with a Fair Market Value equal to the minimum amount of taxes required
to be withheld; but in no event will the Company withhold Shares if such
withholding would result in adverse accounting consequences to the Company. In
such case, the Company shall issue the net number of Shares to the Participant
by deducting the Shares retained from the Shares issuable upon exercise.

                  4.5   Issuance of Shares. Provided that the Exercise Agreement
and payment are in form and substance satisfactory to counsel for the Company,
the Company shall issue the Shares registered in the name of Participant,
Participant's authorized assignee, or Participant's legal representative, and
shall deliver certificates representing the Shares with the appropriate legends
affixed thereto.

                                       3
<PAGE>

            5.    NOTICE OF DISQUALIFYING DISPOSITION OF ISO SHARES. If the
Option is an ISO, and if Participant sells or otherwise disposes of any of the
Shares acquired pursuant to the ISO on or before the later of (i) the date two
(2) years after the Date of Grant, and (ii) the date one (1) year after transfer
of such Shares to Participant upon exercise of the Option, Participant shall
immediately notify the Company in writing of such disposition. Participant
agrees that Participant may be subject to income tax withholding by the Company
on the compensation income recognized by Participant from the early disposition
by payment in cash or out of the current wages or other compensation payable to
Participant.

            6.    COMPLIANCE WITH LAWS AND REGULATIONS. The Plan and this
Agreement are intended to comply with Section 25102(o) of the California
Corporations Code and any regulations relating thereto. Any provision of this
Agreement which is inconsistent with Section 25102(o) or any regulations
relating thereto shall, without further act or amendment by the Company or the
Board, be reformed to comply with the requirements of Section 25102(o) and any
regulations relating thereto. The exercise of the Option and the issuance and
transfer of Shares shall be subject to compliance by the Company and Participant
with all applicable requirements of federal and state securities laws and with
all applicable requirements of any stock exchange on which the Company's Common
Stock may be listed at the time of such issuance or transfer. Participant
understands that the Company is under no obligation to register or qualify the
Shares with the SEC, any state securities commission or any stock exchange to
effect such compliance.

            7.    NONTRANSFERABILITY OF OPTION. The Option may not be
transferred in any manner other than by will or by the laws of descent and
distribution and may be exercised during the lifetime of Participant only by
Participant or in the event of Participant's incapacity, by Participant's legal
representative. The terms of the Option shall be binding upon the executors,
administrators, successors and assigns of Participant.

            8.    COMPANY'S REPURCHASE OPTION FOR UNVESTED SHARES. The Company,
or its assignee, shall have the option to repurchase Participant's Unvested
Shares (as defined in Section 2.2 of this Agreement) on the terms and conditions
set forth in the Exercise Agreement (the "REPURCHASE OPTION") if Participant is
Terminated (as defined in the Plan) for any reason, or no reason, including
without limitation Participant's death, Disability (as defined in the Plan),
voluntary resignation or termination by the Company with or without Cause.
Notwithstanding the foregoing, the Company shall retain the Repurchase Option
for Unvested Shares only as to that number of Unvested Shares (whether or not
exercised) that exceeds the number of shares which remain unexercised.

            9.    COMPANY'S RIGHT OF FIRST REFUSAL. Unvested Shares may not be
sold or otherwise transferred by Participant without the Company's prior written
consent. Before any Vested Shares held by Participant or any transferee of such
Vested Shares may be sold or otherwise transferred (including without limitation
a transfer by gift or operation of law), the Company and/or its assignee(s)
shall have an assignable right of first refusal to purchase the Vested Shares to
be sold or transferred on the terms and conditions set forth in the Exercise
Agreement (the "RIGHT OF FIRST REFUSAL"). The Company's Right of First Refusal
will terminate when the Company's securities become publicly traded.

            10.   TAX CONSEQUENCES. Set forth below is a brief summary as of the
Effective Date of the Plan of some of the federal and California tax
consequences of exercise of the Option and disposition of the Shares. THIS
SUMMARY IS NECESSARILY INCOMPLETE, AND THE TAX LAWS AND REGULATIONS ARE SUBJECT
TO CHANGE. PARTICIPANT SHOULD CONSULT A TAX ADVISER BEFORE EXERCISING THE OPTION
OR DISPOSING OF THE SHARES.

                  10.1  Exercise of ISO. If the Option qualifies as an ISO,
there will be no regular federal or California income tax liability upon the
exercise of the Option, although the excess, if any, of the Fair Market Value of
the Shares on the date of exercise over the Exercise Price will be treated as a
tax preference item for federal alternative minimum tax purposes and may subject
the Participant to the alternative minimum tax in the year of exercise.

                  10.2  Exercise of Nonqualified Stock Option. If the Option
does not qualify as an ISO, there may be a regular federal and California income
tax liability upon the exercise of the Option. Participant

                                       4
<PAGE>

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 Participant is a
current or former employee of the Company, the Company may be required to
withhold from Participant's compensation or collect from Participant and pay to
the applicable taxing authorities an amount equal to a percentage of this
compensation income at the time of exercise.

                  10.3  Disposition of Shares. The following tax consequences
may apply upon disposition of the Shares.

                        (a)   Incentive Stock Options. If the Shares are held
for more than twelve (12) months after the date of the transfer of the Shares
pursuant to the exercise of an ISO and are disposed of more than two (2) years
after the Date of Grant, any gain realized on disposition of the Shares will be
treated as long term capital gain for federal and California income tax
purposes. If Shares purchased under an ISO are disposed of within the applicable
one (1) year or two (2) year period, any gain realized on such disposition will
be treated as compensation income (taxable at ordinary income rates) to the
extent of the excess, if any, of the Fair Market Value of the Shares on the date
of exercise over the Exercise Price.

                        (b)   Nonqualified Stock Options. If the Shares are held
for more than twelve (12) months after the date of the transfer of the Shares
pursuant to the exercise of an NQSO, any gain realized on disposition of the
Shares will be treated as long term capital gain.

                        (c)   Withholding. The Company may be required to
withhold from the Participant's compensation or collect from the Participant and
pay to the applicable taxing authorities an amount equal to a percentage of this
compensation income.

                  10.4. Section 83(b) Election for Unvested Shares. With respect
to Unvested Shares, which are subject to the Repurchase Option, unless an
election is filed by the Participant with the Internal Revenue Service (and, if
necessary, the proper state taxing authorities), within 30 days of the purchase
of the Unvested Shares, electing pursuant to Section 83(b) of the Code (and
similar state tax provisions, if applicable) to be taxed currently on any
difference between the Exercise Price of the Unvested Shares and their Fair
Market Value on the date of purchase, there may be a recognition of taxable
income (including, where applicable, alternative minimum taxable income) to the
Participant, measured by the excess, if any, of the Fair Market Value of the
Unvested Shares at the time they cease to be Unvested Shares, over the Exercise
Price of the Unvested Shares.

            11.   PRIVILEGES OF STOCK OWNERSHIP. Participant shall not have any
of the rights of a shareholder with respect to any Shares until the Shares are
issued to Participant.

            12.   INTERPRETATION. Any dispute regarding the interpretation of
this Agreement shall be submitted by Participant or the Company to the Committee
for review. The resolution of such a dispute by the Committee shall be final and
binding on the Company and Participant.

            13.   ENTIRE AGREEMENT. The Plan is incorporated herein by
reference. This Agreement and the Plan constitute the entire agreement of the
parties and supersede all prior undertakings and agreements with respect to the
subject matter hereof.

            14.   NOTICES. Any notice required to be given or delivered to the
Company under the terms of this Agreement shall be in writing and addressed to
the Corporate Secretary of the Company at its principal corporate offices. Any
notice required to be given or delivered to Participant shall be in writing and
addressed to Participant at the address indicated above or to such other address
as such party may designate in writing from time to time to the Company. All
notices shall be deemed to have been given or delivered upon: (i) personal
delivery; (ii) three (3) days after deposit in the United States mail by
certified or registered mail (return receipt requested); (iii) one (1) business
day after deposit with any return receipt express courier (prepaid); or (iv) one
(1) business day after transmission by facsimile, rapifax or telecopier.

                                       5
<PAGE>

            15.   SUCCESSORS AND ASSIGNS. The Company may assign any of its
rights under this Agreement including its rights to purchase Shares under the
Repurchase Option and the Right of First Refusal. This Agreement shall be
binding upon and inure to the benefit of the successors and assigns of the
Company. Subject to the restrictions on transfer set forth herein, this
Agreement shall be binding upon Participant and Participant's heirs, executors,
administrators, legal representatives, successors and assigns.

            16.   GOVERNING LAW. This Agreement shall be governed by and
construed in accordance with the laws of the State of California as such laws
are applied to agreements between California residents entered into and to be
performed entirely within California. If any provision of this Agreement is
determined by a court of law to be illegal or unenforceable, then such provision
will be enforced to the maximum extent possible and the other provisions will
remain fully effective and enforceable.

            17.   ACCEPTANCE. Participant hereby acknowledges receipt of a copy
of the Plan and this Agreement. Participant has read and understands the terms
and provisions thereof, and accepts the Option subject to all the terms and
conditions of the Plan and this Agreement. Participant acknowledges that there
may be adverse tax consequences upon exercise of the Option or disposition of
the Shares and that Participant should consult a tax adviser prior to such
exercise or disposition.

            IN WITNESS WHEREOF, the Company has caused this Agreement to be
executed in triplicate by its duly authorized representative and Participant has
executed this Agreement in triplicate, effective as of the Date of Grant.

AVIVO CORPORATION                            PARTICIPANT

By:________________________________          ___________________________________
                                             (Signature)

___________________________________          ___________________________________
(Please print name)                          (Please print name)

___________________________________
(Please print title)

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<PAGE>

                                    EXHIBIT A

                     FORM OF STOCK OPTION EXERCISE AGREEMENT

                                       1