Exhibit 4.1


                                YORK MEDICAL INC.

                             1996 STOCK OPTION PLAN


1.                            PURPOSE OF THE PLAN

1.1 The  purpose  of the Plan is to  attract,  retain  and  motivate  persons of
training,  experience and leadership as key service providers to the Corporation
and its Subsidiaries,  including their directors, officers and employees, and to
advance the  interests of the  Corporation  by  providing  such persons with the
opportunity, through share options, to acquire an increased proprietary interest
in the Corporation.

2.                               DEFINED TERMS

         Where  used  herein,  the  following  terms  shall  have the  following
meanings, respectively:

2.1 "BOARD" means the board of directors of the  Corporation  or, if established
and duly authorized to act, the Executive Committee of the board of directors of
the Corporation;

2.2 "COMMITTEE" shall have the meaning attributed thereto in Section 3.1 hereof;

2.3 "CORPORATION" means York Medical Inc. and includes any successor corporation
thereof;

2.4 "ELIGIBLE PERSON" Means:

         (i)      any Insider,  director, officer or employee of the Corporation
                  or any Subsidiary, or any other Service Provider (an "ELIGIBLE
                  INDIVIDUAL"); or

         (ii)     a corporation controlled by an Eligible Individual, the issued
                  and outstanding  voting shares of which are, and will continue
                  to be,  beneficially  owned,  directly or indirectly,  by such
                  Eligible   Individual  and/or  the  spouse,   children  and/or
                  grandchildren  of  such  Eligible   Individual  (an  "EMPLOYEE
                  CORPORATION");

2.5 "INSIDER"  means any insider,  as such term is defined in Subsection 1(1) of
the Securities Act (Ontario), of the Corporation,  other than a person who falls
within that definition solely by virtue of being a director or senior officer of
a Subsidiary,  and includes any associate, as such term is defined in Subsection
(1) of the Securities Act (Ontario), of any such insider;

2.6 "MARKET  PLACE" at any date in respect of the Shares  means the closing sale
price of such Shares on The Toronto  Stock  Exchange (or, if such Shares are not
then listed and posted for trading on The Toronto Stock Exchange,  on such stock
exchange in Canada on which such Shares are listed and posted for trading as may
be selected for such purpose by the  Committee)  on the trading day  immediately
preceding such date. In the event that such Shares did not trade on such trading
day,  the Market Place shall be the average of the bid and ask prices in respect

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of such  Shares at the close of trading on such  trading  day. In the event that
such  Shares are not listed and posted for  trading on any stock  exchange,  the
Market Price shall be the fair market value of such Shares as  determined by the
Committee in its sole discretion;

2.7 "OPTION" means an option to purchase  Shares  granted to an Eligible  Person
under the Plan;

2.8 "OPTION  PRICE"  means the price per Share at which  Shares may be purchased
under an Option,  as the same may be  adjusted  from time to time in  accordance
with Article 8 hereof;

2.9  "OPTIONED  SHARES"  means the Shares  issuable  pursuant  to an exercise of
Options;

2.10 "OPTIONEE"  means an Eligible Person to whom an Option has been granted and
who continues to hold such Option;

2.11 "PLAN" means the York Medical Inc.  1996 Stock Option Plan, as the same may
be further amended or varied from time to time;

2.12 "SERVICE  PROVIDER"  means any person or company  engaged as an independent
contractor or otherwise to provide ongoing management or consulting services for
the Corporation or for any entity controlled by the Corporation;

2.13 "SHARES" means the Common Shares of the  Corporation or, in the event of an
adjustment  contemplated by Article 8 hereof, such other shares or securities to
which an Optionee may be entitled  upon the exercise of an Option as a result of
such adjustment; and

2.14 "SUBSIDIARY"  means any corporation which is a subsidiary,  as such term is
defined in Subsection 1(2) of the Business  Corporations  Act (Ontario),  of the
Corporation.

3.                         ADMINISTRATION OF THE PLAN

3.1  The  Plan  shall  be  administered  by  the  compensation   committee  (the
"COMMITTEE") of the Board.

3.2 The  Committee  shall  have the power,  where  consistent  with the  general
purpose and intent of the Plan and  subject to the  specific  provisions  of the
Plan:

         (a)      to establish  policies and to adopt rules and  regulations for
                  carrying out the purposes,  provisions and  administration  of
                  the Plan;

         (b)      to  interpret  and  construe  the  Plan and to  determine  all
                  questions arising out of the Plan or any Option,  and any such
                  interpretation,  construction  or  determination  made  by the
                  Committee  shall be  final,  binding  and  conclusive  for all
                  purposes;

         (c)      to determine the number of Shares covered by each Option;

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         (d)      to determine the Option Price of each Option;

         (e)      to  determine  the time or times when  Options will be granted
                  and exercisable;

         (f)      to  determine if the Shares which are issuable on the exercise
                  of an Option  will be  subject  to any  restrictions  upon the
                  exercise of such Option; and

         (g)      to  prescribe  the  form of the  instruments  relating  to the
                  grant, exercise and other terms of Options.

3.3  Subject as  hereinafter  provided  in this  Section  3.3,  no member of the
Committee shall,  during the currency of his or her membership on the Committee,
be  entitled  to  participate  in the  Plan.  A member of the  Committee  may be
entitled to participate in the Plan only if an Option is granted,  and the terms
and  provisions  thereof  determined,  by the Board  without  such member of the
Committee  participating in any many whatsoever in the granting of an Option to,
or the  determinations  made with respect to, such member of the Committee or to
such Option;  and the Board shall, with respect to such member of the Committee,
be vested  with all power  and  authority  otherwise  granted  to the  Committee
pursuant  to the Plan and the term  "Committee"  as used  herein  shall mean the
Board for such purposes.

3.4 The Committee may, in its discretion,  require as conditions to the grant or
exercise of any Option that the Optionee shall have:

         (a)      represented,  warranted  and  agreed  in  form  and  substance
                  satisfactory  to the  Corporation  that he or she is acquiring
                  and will  acquire such Option and the Shares to be issued upon
                  the exercise thereof or, as the case may be, is acquiring such
                  Shares,  for his or her own account,  for  investment  and not
                  with a view to or in connection with any distribution, that he
                  or she has had access to such  information  as is necessary to
                  enable  him or her to  evaluate  the  merits and risks of such
                  investment  and  that he or she is able to bear  the  economic
                  risk of holding such Shares for an indefinite period;

         (b)      agreed  to  restrictions  on  transfer  in form and  substance
                  satisfactory  to the  Corporation and to an endorsement on any
                  option agreement on certificate representing the Shares making
                  appropriate reference to such restrictions; and

         (c)      agreed to indemnify the  Corporation  in  connection  with the
                  foregoing.

3.5 Any Option granted under the Plan shall be subject to the requirement  that,
if at any time  counsel to the  Corporation  shall  determine  that the listing,
registration  or  qualification  of the Shares  subject to such  Option upon any
securities  exchange or under any law or regulation of any jurisdiction,  or the
consent or approval of any securities exchange or any governmental or regulatory
body,  is  necessary  as a condition  of, or in  connection  with,  the grant or
exercise of such Option or the issuance or purchase of Shares  thereunder,  such
Option may not be accepted or exercised in whole or in part unless such listing,
registration,  qualification,  consent or approval  shall have been  effected or

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obtained on conditions  acceptable  to the  Committee.  Nothing  herein shall be
deemed to  require  the  Corporation  to apply for or to  obtain  such  listing,
registration, qualification, consent or approval.

4.                         SHARES SUBJECT TO THE PLAN

4.1  Options  may be  granted  in respect of  authorized  and  unissued  Shares,
provided  that the  aggregate  number of Shares  reserved for issuance  upon the
exercise of all Options  granted  under the Plan,  subject to any  adjustment of
such number  pursuant to the  provisions of Article 8 hereof,  together with any
Shares  reserved for issuance  under any options for services or employee  stock
purchase or stock option plans or any other  plans,  shall not exceed  1,500,000
(based on a  subdivision  of the  Corporation's  Common  Shares on a 6.7 for one
basis) or such greater  number of Shares as may be  determined  by the Board and
approved,  if  required,  by  the  shareholders  of the  Corporation  and by any
relevant  stock  exchange  or other  regulatory  authority.  Optioned  Shares in
respect of which  Options are not exercised  shall be available  for  subsequent
Options. No fractional Shares may be purchased or issued under the Plan.

5.                    ELIGIBILITY; GRANT; TERMS OF OPTIONS

5.1 Options may be granted to any Eligible Person in accordance with Section 5.2
hereof.

5.2 Options may be granted by the Corporation pursuant to the recommendations of
the Committee  from time to time provided and to the extent that such  decisions
are approved by the Board.

5.3 Subject as herein and otherwise specifically provided in this Article 5, the
number of Shares  subject to each Option,  the Option Price of each Option,  the
expiration  date of each Option,  the extent to which each Option is exercisable
from time to time during the term of the Option and other  terms and  conditions
relating to each such Option shall be determined by the Committee.

5.4 In the event that no specific  determination  is made by the Committee  with
respect to any of the following matters, each Option shall, subject to any other
specific provisions of the Plan, contain the following terms and conditions:

         (a)      the period during which an Option shall be  exercisable  shall
                  be 10  years  from  the  date the  Option  is  granted  to the
                  Optionee; and

         (b)      the  Optionee may exercise the Option for not more than 20% of
                  the Shares  covered by the Option  during each 12 month period
                  following  the first  anniversary  of the date of the grant of
                  the Option;  provided,  however,  that if the number of Shares
                  purchased  pursuant to exercises of the Option during any such
                  12 month period is less than 20% of the Shares  covered by the
                  Option, the Optionee shall have the right, at any time or from
                  time to time during the  remainder  of the term of the Option,
                  to purchase such number of Shares  subject to the Option which
                  were purchasable, but not purchased by him or her, during such
                  12 month period.

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5.5 Subject to any  adjustments  pursuant to the provisions of Article 8 hereof,
the Option  Price of any Option shall be in no  circumstances  be lower than the
Market  Price on the date of which the grant of the  Option is  approved  by the
Committee.  Notwithstanding the foregoing,  in the event that the Shares are not
listed  on any  stock  exchange  on the date on which  the grant of an Option is
approved by the Committee,  the Option Price for such Option shall be determined
by the  Committee.  If, as and when any Shares have been duly purchased and paid
for under the terms of an  Option,  such  Shares  shall be  conclusively  deemed
allotted  and  issued as fully  paid  non-assessable  Shares  at the price  paid
therefor.

5.6 No Options  shall be granted to any  Optionee if the total  number of Shares
issuable to such Optionee under this Plan, together with any Shares reserved for
issuance to such  Optionee  under options for services or any other stock option
plans, would exceed 5% of the issued and outstanding Shares.

5.7 An Option  is  personal  to the  Optionee  and  non-assignable  (whether  by
operation of law or otherwise),  except as provided for herein. Upon any attempt
to transfer,  assign,  pledge,  hypothecate  or  otherwise  dispose of an Option
contrary to the  provisions of the Plan,  or upon the levy of any  attachment or
similar  process  upon an  Option,  the Option  shall,  at the  election  of the
Corporation,  cease  and  terminate  and  be  of  no  further  force  or  effect
whatsoever.

5.8 No Options  shall be granted to an Optionee if such grant could  result,  at
any time, in:

         (a)      the number of Shares reserved for issuance pursuant to Options
                  or other stock  options  granted to Insiders  exceeding 10% of
                  the issued and outstanding Shares;

         (b)      the  issuance  to  Insiders,  within a one-year  period,  of a
                  number of Shares  exceeding 10% of the issued and  outstanding
                  Shares; or

         (c)      the issuance to any one Insider and such Insider's associates,
                  within a one-year  period,  of a number of Shares exceeding 5%
                  of the issued and outstanding Shares.

For the purposes of this Section 5.9, the phrase "issued and outstanding Shares"
excludes any Shares issued  pursuant to the Plan or other stock  options,  stock
option plans,  employee stock purchase plans or other  compensation or incentive
mechanisms,  over a preceding  one-year period and "associate"  means any person
associated with such Insider.

6.                      TERMINATION OF EMPLOYMENT; DEATH

6.1 Subject to Sections 6.2 and 6.3 hereof and to any express  resolution passed
by the committee with respect to an Option, an Option and all rights to purchase
Shares pursuant thereto shall expire and terminate immediately upon the Optionee
who holds such Option ceasing to be an Eligible Person.

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6.2 If, before the expiry of an Option in accordance with the terms thereof,  an
Optionee shall cease to be an Eligible  Person (an "EVENT OF  TERMINATION")  for
any reason other than his or her  resignation or the  termination for "cause" of
his or her  employment  with the  Corporation or any  Subsidiary,  or his or her
resignation or failure to be re-elected as a director of the  Corporation or any
Subsidiary, then the Optionee may:

         (a)      exercise  the Option to the extent that he or she was entitled
                  to do so at the time of such Event of Termination, at any time
                  up to and  including,  but not after,  a date three (3) months
                  following the date of such Event of  Termination,  or prior to
                  the close of  business on the  expiration  date of the Option,
                  whichever is earlier; and

         (b)      with the prior written  consent of the Board or the Committee,
                  which  consent  may  be  withheld  in the  Corporation's  sole
                  discretion,  exercise  a further  Option at any time up to and
                  including,  but not after,  a date three (3) months  following
                  the date of such Event of  Termination,  or prior to the close
                  of business on the expiration date of the Option, whichever is
                  earlier,  to purchase all or any of the Optioned Shares as the
                  Board or the  Committee  may  designate  but not exceeding the
                  number of Optioned  Shares the Optionee  would have  otherwise
                  been  entitled  to  purchase  pursuant  to the  Option had the
                  Optionee's  status as an Eligible  Person been  maintained for
                  the term of the Option.

6.3 If an Optionee  dies before the expiry of an Option in  accordance  with the
terms thereof, the Optionee's legal  representative(s) may, subject to the terms
of the Option and the Plan:

         (a)      exercise  the  Option  to the  extent  that the  Optionee  was
                  entitled  to do so at the date of his or her death at any time
                  up to and including,  but not after, a date one year following
                  the date of death of the  Optionee,  or prior to the  close of
                  business on the  expiration  date of the Option,  whichever is
                  earlier; and

         (b)      with the prior written  consent of the Board or the Committee,
                  exercise  at any time up to and  including,  but not after,  a
                  date one year  following the date of death of the Optionee,  a
                  further  Option to purchase all or any of the Optioned  Shares
                  as the Board or the  Committee may designate but not exceeding
                  the  number  of  Optioned   Shares  the  Optionee  would  have
                  otherwise been entitled to purchase had the Optionee survived.

6.4 For  greater  certainty,  Options  shall not be  affected  by any  change of
employment  of the Optionee or by the  Optionee  ceasing to be a director of the
Corporation provided that the Optionee continues to be an Eligible Person.

6.5 For the purposes of this Article 6, a determination  by the Corporation that
an  Optionee  was  discharged  for  "cause"  shall be binding  on the  Optionee;
provided,  however,  that  such  determination  shall not be  conclusive  of the
Optionee's  potential  entitlement  to  damages  for the  loss of the  right  to
exercise  an  Option  in  the  event  that a  court  of  competent  jurisdiction
ultimately determines that the discharge was without "cause".

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6.6 If the Optionee is an Employee  Corporation,  the references to the Optionee
in this Article 6 shall be deemed to refer to the Eligible Individual associated
with the Employee Corporation.

7.                            EXERCISE OF OPTIONS

7.1 Subject to the  provisions of the Plan, an Option may be exercised from time
to time by delivery to the  Corporation  at its  registered  office of a written
notice of exercise addressed to the Secretary of the Corporation  specifying the
number of  Shares  with  respect  to which the  Option  is being  exercised  and
accompanied  by payment in full,  by cash or cheque,  of the Option Price of the
Shares then being  purchased.  Certificates  for such Shares shall be issued and
delivered to the Optionee within a reasonable time following the receipt of such
notice and payment.

7.2  Notwithstanding  any of the  provisions  contained  in the  Plan  or in any
Option, the Corporation's  obligation to issue Shares to an Optionee pursuant to
the exercise of any Option shall be subject to:

         (a)      completion of such registration or other qualification of such
                  Shares  or  obtaining   approval  of  such   governmental   or
                  regulatory  authority as the Corporation shall determine to be
                  necessary or advisable in connection  with the  authorization,
                  issuance or sale thereof;

         (b)      the  administration  of such  Shares to  listing  on any stock
                  exchange on which the Shares may then be listed;

         (c)      the  receipt  from  the  Optionee  of  such   representations,
                  warranties,  agreements and  undertakings,  as the Corporation
                  determines  to be necessary or advisable in order to safeguard
                  against  the   violation  of  the   securities   laws  of  any
                  jurisdiction; and

         (d)      the  satisfaction  of any  conditions  on exercise  prescribed
                  pursuant to Section 3.4 hereof.

In this connection the  Corporation  shall,  to the extent  necessary,  take all
commercially  reasonable  steps to obtain  such  approvals,  registrations,  and
qualifications as may be necessary for the issuance of such Shares in compliance
with applicable  securities laws and for the listing of such Shares on any stock
exchange on which the Share are then listed.

7.3 Options  shall be  evidenced  by a share  option  agreement,  instrument  or
certificate  in such form not  inconsistent  with this Plan as the Committee may
from time to time determine as provided for under  Subsection  3.2(g),  provided
that the substance of Article 5 be included therein.

8.                            CERTAIN ADJUSTMENTS

8.1 In the event of any  subdivision  or redivision of the Shares into a greater
number of Shares at any time  after the grant of an Option to any  Optionee  and
prior  to the  expiration  of the term of such  Option,  the  Corporation  shall
deliver to such  Optionee at the time of any  subsequent  exercise of his or her

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Option in accordance  with the terms hereof,  in lieu of the number of shares to
which he or she was  theretofore  entitled upon such exercise,  but for the same
aggregate consideration payable therefor, such number of Shares as such Optionee
would have held as a result of such  subdivision or redivision if, on the record
date  thereof,  the  Optionee  had been the  registered  holder of the number of
Shares to which he or she was theretofore entitled upon such exercise.

8.2 In the event of any  consolidation  of the  Shares  into a lesser  number of
Shares at any time after the grant of an Option to any Optionee and prior to the
expiration  of the term of such Option,  the  Corporation  shall deliver to such
Optionee  at the  time  of any  subsequent  exercise  of  his or her  Option  in
accordance with the terms hereof, in lieu of the number of Shares to which he or
she was  theretofore  entitled upon such  exercise,  but for the same  aggregate
consideration  payable  therefor,  such number of Shares as such Optionee  would
have held as a result of such consolidation if, on the record date thereof,  the
Optionee had been the  registered  holder of the number of Shares to which he or
she was theretofore entitled upon such exercise.

8.3 If at any time after the grant of any Option to an Optionee and prior to the
expiration  of the  term of such  Option,  the  Shares  shall  be  reclassified,
reorganized  or otherwise  changed,  otherwise than as specified in Sections 8.1
and  8.2  or,  subject  to the  provisions  of  Subsection  9.2(a)  hereof,  the
Corporation  shall  consolidate,  merge  or  amalgamate  with  or  into  another
corporation  (the corporation  resulting or continuing from such  consolidation,
merger or amalgamation being herein called the "SUCCESSOR  CORPORATION") or, the
Corporation shall pay a stock dividend (other than any dividends in the ordinary
course),  the Optionee shall be entitled to receive upon the subsequent exercise
of his or her Option in  accordance  with the terms  hereof and shall  accept in
lieu of the number of Shares to which he or she was  theretofore  entitled  upon
such exercise but for the same aggregate  consideration  payable  therefor,  the
aggregate the number of shares of the appropriate  class and/or other securities
of the  Corporation or the Successor  Corporation  (as the case may be) that the
Optionee   would   have  been   entitled   to   receive  as  a  result  of  such
reclassification,  reorganization  or other change or,  subject to provisions of
Subsection   9.2(a)  hereof,  as  a  result  of  such   consolidation,   merger,
amalgamation, or stock dividend, if on the record date of such reclassification,
reorganization,  other  change or stock  dividend,  or the  record  date of such
consolidation,  merger or amalgamation or dividend payment,  as the case may be,
he or she had been the registered  holder of the number of Shares to which he or
she was theretofore entitled upon such exercise.

8.4 In the event the Corporation  should declare and pay a special cash dividend
or other  distribution  out of the ordinary course, a special dividend in specie
on the Shares, or a stock dividend other than in the ordinary course, the Option
Price of all Options  outstanding  on the record date of such  dividend or other
distribution  shall be reduced by an amount  equal to the cash  payment or other
distribution  or the  fair  market  value of the  dividend  in  specie  or stock
dividend or other  distribution,  as  determined  by the  Committee  in its sole
discretion.

9.                  AMENDMENT OR DISCONTINUANCE OF THE PLAN

9.1 The Board may amend or discontinue the Plan at any time, provided,  however,
that no such amendment may materially and adversely affect any Option previously
granted to an Optionee without the consent of the Optionee, except to the extent

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required by law. Any such amendment shall, if required,  be subject to the prior
approval of, or acceptance by, any stock exchange on which the Shares are listed
and posted for trading.

9.2  Notwithstanding  anything  contained to the contrary in this Plan or in any
resolution of the Board in implementation thereof:

         (a)      in the event the Corporation proposes to amalgamate,  merge or
                  consolidate   with  any  other   corporation   (other  than  a
                  wholly-owned Subsidiary) or to liquidate, dissolve or wind-up,
                  or in the event an offer to purchase or repurchase  the Shares
                  of the Corporation or any part thereof shall be made to all or
                  substantially  all holders of Shares of the  Corporation,  the
                  Corporation  shall have the right, upon written notice thereof
                  to each Optionee holding Options under the Plan, to permit the
                  exercise  of all such  Options  within the 20 day period  next
                  following  the date of such notice and to determine  that upon
                  the  expiration  of  such 20 day  period,  all  rights  of the
                  Optionees to such  Options or to exercise  same (to the extent
                  not  theretofore  exercised)  shall ipso facto  terminate  and
                  cease to have further force or effect whatsoever;

         (b)      in  the  event  of  the  sale  by  the  corporation  of all or
                  substantially  all of the  assets  of  the  Corporation  as an
                  entirety  or   substantially   as  an  entirety  so  that  the
                  Corporation shall cease to operate as an active business,  any
                  outstanding  Option may be  exercised as to all or any part of
                  the  Optioned  Shares in respect of which the  Optionee  would
                  have been entitled to exercise the Option in  accordance  with
                  the  provisions  of the Plan at the date of  completion of any
                  such sale at any time up to and  including,  but not after the
                  earlier  of: (i) the close of  business  on that date which is
                  thirty  (30) days  following  the date of  completion  of such
                  sale; and (ii) the close of business on the expiration date of
                  the Option; but the Optionee shall not be entitled to exercise
                  the Option with respect to any other Optioned Shares;

         (c)      subject to the rules of any relevant  stock  exchange or other
                  regulatory  authority,  the Board may, by resolution,  advance
                  the date on which any  Option may be  exercised  or extend the
                  expiration  date of any  Option.  The Board  shall not, in the
                  event of any  such  advancement  or  extension,  be under  any
                  obligation  to  advance  or  extend  the  date on or by  which
                  Options may be exercised by any other Optionee; and

         (d)      the Board  may,  by  resolution,  but  subject  to  applicable
                  regulatory  requirements,  decide  that any of the  provisions
                  hereof  concerning the effect of termination of the Optionee's
                  employment  shall not  apply to any  Optionee  for any  reason
                  acceptable to the Board.

Notwithstanding  the provisions of this Article 9, should changes be required to
the Plan by any securities  commission,  stock exchange or other governmental or
regulatory body of any  jurisdiction to which the Plan or the Corporation now is
or hereafter  becomes  subject,  such  changes  shall be made to the Plan as are

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necessary to conform with such requirements and, if such changes are approved by
the  Board,  the  Plan,  as  amended,  shall be filed  with the  records  of the
Corporation  and shall remain in full force and effect in its amended form as of
and from the date of its adoption by the Board.

10. MISCELLANEOUS PROVISIONS

10.1 An Optionee shall not have any rights as a shareholder  of the  Corporation
with  respect to any of the  Shares  covered  by such  Option  until the date of
issuance of a certificate  for Shares upon the exercise of such Option,  in full
or in part,  and then  only  with  respect  to the  Shares  represented  by such
certificate or certificates. Without in any way limiting the generality o of the
foregoing,  no adjustment  shall be made for dividends or other rights for which
the record date is prior to the date such share certificate is issued.

10.2  Nothing in the Plan or any Option  shall confer upon an Optionee any right
to continue or be  re-elected as a director of the  Corporation  or any right to
continue in the employ of the  Corporation or any  Subsidiary,  or affect in any
way the right of the  Corporation  or any  Subsidiary  to  terminate  his or her
employment at any time;  nor shall  anything in the Plan or any Option be deemed
or construed to constitute an agreement, or an expression of intent, on the part
of the  Corporation  or any  Subsidiary to extend the employment of any Optionee
beyond the time which he or she would be  normally  be retired  pursuant  to the
provisions of any present or future  retirement  plan of the  Corporation or any
Subsidiary or any present or future  retirement policy of the Corporation or any
Subsidiary,  or beyond  the time at which he or she would  otherwise  be retired
pursuant to the provisions of any contract of employment with the Corporation or
any Subsidiary.

10.3 Notwithstanding  Section 5.8 hereof, Options may be transferred or assigned
between an Eligible Individual and the related Employee Corporation provided the
assignor delivers notice to the Corporation prior to the assignment.

10.4  The Plan  and all  matters  to which  reference  is made  herein  shall be
governed  by and  interpreted  in  accordance  with the laws of the  Province of
Ontario and the laws of Canada applicable therein.

11.                   SHAREHOLDER AND REGULATORY APPROVAL

11.1 The Plan  shall be  subject  to  ratification  by the  shareholders  of the
Corporation  to  be  effected  by a  resolution  passed  at  a  meeting  of  the
shareholders of the Corporation, and to acceptance by The Toronto Stock Exchange
and any other relevant regulatory  authority.  Any Options granted prior to such
ratification  and acceptance  shall be conditional  upon such  ratification  and
acceptance  being given and no such  Options may be  exercised  unless and until
such ratification and acceptance are given.

<PAGE>

                               YM BIOSCIENCES INC.

                            RESOLUTIONS OF DIRECTORS

     EXCERPTED  from the  Minutes of the annual and  special  meeting of the
     shareholders  of YM  BIOSCIENCES  INC.,  held at the  offices of Heenan
     Blaikie LLP, 200 Bay Street, Royal Bank Plaza, South Tower, Suite 2600,
     Toronto,  Ontario  M5J 2J4 on November  26, 2003 at 4:30 p.m.  (Toronto
     time).

                                      *****

AMENDMENT TO THE EMPLOYEE STOCK OPTION PLAN

The  Chairman  next put  before  the  meeting a  resolution  of the  Corporation
authorizing an amendment to the employee stock option plan to reserve a total of
2,750,000  Common  Shares  representing  then 16% of the number of Common Shares
issued and outstanding.

Upon motion duly made, seconded and unanimously carried, it was resolved that:

A resolution  in the form set out as Exhibit "B" to the  management  information
circular of the  Corporation  dated  October 28, 2003 with  respect to the above
described matter be and is hereby adopted by the shareholders of the Corporation
and its content confirmed and approved.