Document:

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                                                                   EXHIBIT 10.32

     "THE SECURITIES REPRESENTED BY THIS CERTIFICATE HAVE BEEN ACQUIRED FOR
     INVESTMENT AND NOT WITH A VIEW TO, OR IN CONNECTION WITH, THE SALE OR
     DISTRIBUTION THEREOF. NO SUCH SALE OR DISPOSITION MAY BE EFFECTED WITHOUT
     AN EFFECTIVE REGISTRATION STATEMENT RELATED THERETO OR AN OPINION OF
     COUNSEL REASONABLY SATISFACTORY TO THE CORPORATION THAT SUCH REGISTRATION
     IS NOT REQUIRED UNDER THE SECURITIES ACT OF 1933, AS AMENDED.

     THESE SECURITIES HAVE NOT BEEN REGISTERED WITH THE UNITED STATES SECURITIES
     AND EXCHANGE COMMISSION UNDER THE SECURITIES ACT OF 1933, AS AMENDED (THE
     "ACT"), OR THE SECURITIES COMMISSION OF ANY STATE UNDER ANY STATE
     SECURITIES LAW. THEY ARE BEING OFFERED PURSUANT TO A SAFE HARBOR FROM
     REGISTRATION UNDER REGULATION S ("REGULATION S") PROMULGATED UNDER THE ACT.
     THE SECURITIES MAY NOT BE OFFERED, SOLD OR OTHERWISE TRANSFERRED IN THE
     UNITED STATES OR TO U. S. PERSONS (AS SUCH TERM IS DEFINED IN REGULATION S)
     UNLESS THE SECURITIES ARE REGISTERED UNDER THE ACT AND APPLICABLE STATE
     SECURITIES LAWS, OR SUCH OFFERS, SALES AND TRANSFERS ARE MADE PURSUANT TO
     AN AVAILABLE EXEMPTION OR SAFE HARBOR FORM THE REGISTRATION REQUIREMENTS OF
     THOSE LAWS.

     THE SECURITIES REPRESENTED BY THIS CERTIFICATE ARE SUBJECT TO CERTAIN
     RESTRICTIONS ON TRANSFER AND CERTAIN MARKET STAND-OFF PROVISIONS WHICH ARE
     CONTAINED IN A SUBORDINATED CONVERTIBLE NOTE PURCHASE AGREEMENT, DATED AS
     OF JANUARY 25, 2000, COPIES OF WHICH ARE ON FILE AT THE PRINCIPAL OFFICE OF
     THE CORPORATION."

                                 ITERIS, INC.

                   Subordinated Convertible Promissory Note

$3,750,000                                                 January 25, 2000
                                                           Anaheim, California

     FOR VALUE RECEIVED, Iteris, Inc., a Delaware corporation ("Company"),
promises to pay to DaimlerChrysler Venture GmbH ("Holder"), or its registered
assigns, the principal sum of Three Million Seven Hundred and Fifty Thousand
Dollars ($3,750,000.00), or such lesser amount as shall equal the outstanding
principal amount hereof, together with interest from the date of this
subordinated convertible promissory note ("Note") on the unpaid principal
balance calculated in accordance with Section 2 hereof. All unpaid principal,
                                      ---------
together with any then unpaid and accrued interest and other amounts payable
hereunder, shall be due and payable on
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the earlier of (i) the second anniversary of the date of this Note, or (ii)
when, upon or after the occurrence of an Event of Default (as defined below),
such amounts are declared due and payable by Holder. This Note is issued
pursuant to the Note Purchase Agreement (as defined below).

     1.   Definitions.  As used in this Note, the following capitalized terms
          -----------
have the following meanings:

          (a)  "Affiliate," with respect to any Person, means (i) any director,
officer or employee of such Person, (ii) any Person directly or indirectly
controlling or controlled by or under direct or indirect common control with
such Person, and (iii) any Person beneficially owning or holding 10% or more of
any class of voting securities of such Person or any corporation of which such
Person beneficially owns or holds, in the aggregate, 10% or more of any class of
voting securities The term "control" means the possession, directly or
indirectly, of the power to direct or cause the direction of the management and
policies of a Person, whether through the ownership of voting securities, by
contract or otherwise. The term "Affiliate," when used herein without reference
to any Person, shall mean an Affiliate of Company.

          (b)  "Company" includes the corporation initially executing this Note
and any Person which shall succeed to or assume the obligations of Company under
this Note.

          (c)  "Certificate" shall mean the Certificate of Incorporation of
Company as amended and/or restated and effective immediately prior to the
redemption or conversion of all of this Note.

          (d)  "Equity Securities" of any Person shall mean (a) all common
stock, preferred stock, participations, shares, partnership interests or other
equity interests in and of such Person (regardless of how designated and whether
or not voting or non-voting) and (b) all warrants, options and other rights to
acquire any of the foregoing.

          (e)  "Event of Default" has the meaning given in Section 5 hereof.
                                                           ---------

          (f)  "GAAP" shall mean generally accepted accounting principles as in
effect in the United States of America from time to time.

          (g)  "Holder" shall mean the Person specified in the introductory
paragraph of this Note or any Person who shall at the time be the registered
holder of this Note.

          (h)  "Indebtedness" shall mean and include the aggregate amount of,
without duplication (i) all obligations for borrowed money, (ii) all obligations
evidenced by bonds, debentures, notes or other similar instruments, (iii) all
obligations to pay the deferred purchase price of property or services (other
than accounts payable incurred in the ordinary course of business determined in
accordance with GAAP), (iv) all obligations with respect to capital leases, (v)
all obligations created or arising under any conditional sale or other title
retention agreement with respect to property acquired by such Person, (vi) all
reimbursement and other payment obligations, contingent or otherwise, in respect
of letters of credit and similar surety instruments; and (vii) all guaranty
obligations with respect to the types of Indebtedness listed in clauses (i)
through (vi) above.

          (i)  [Intentionally Omitted]

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          (j)  "Material Adverse Effect" shall mean a material adverse effect on
(a) the business, assets, operations, or financial condition of Company; or (b)
the ability of Company to pay or perform the Obligations in accordance with the
terms of this Note and the other Transaction Documents and to avoid an Event of
Default, or an event which, with the giving of notice or the passage of time or
both, would constitute an Event of Default, under any Transaction Document.

          (k)  "Note Purchase Agreement" shall mean the Note Purchase Agreement
dated January 25, 2000 between Company and the Holder (as amended, modified or
supplemented from time to time).

          (l)  "Obligations" shall mean and include all loans, advances, debts,
liabilities and financial obligations, howsoever arising, owed by Company to
Holder of every kind and description (whether or not evidenced by any note or
instrument and whether or not for the payment of money), now existing or
hereafter arising under or pursuant to the terms of the Transaction Documents,
including, all interest, fees, charges, expenses, attorneys' fees and costs and
accountants' fees and costs chargeable to and payable by Company hereunder and
thereunder, in each case, whether direct or indirect, absolute or contingent,
due or to become due, and whether or not arising after the commencement of a
proceeding under Title 11 of the United States Code (11 U. S. C. Section 101 et
                                                                             --
seq.), as amended from time to time (including post-petition interest) and
---
whether or not allowed or allowable as a claim in any such proceeding.

          (m)  "Person" shall mean and include an individual, a partnership, a
corporation (including a business trust), a joint stock company, a limited
liability company, an unincorporated association, a joint venture or other
entity or a governmental authority.

          (n)  "Senior Indebtedness" shall mean, unless expressly subordinated
to or made on a parity with the amounts due under this Note, the principal of
(and premium, if any), unpaid interest on and amounts reimbursable, fees,
expenses, costs of enforcement and other amounts due in connection with, (i)
indebtedness of Company, to banks, commercial finance lenders, insurance
companies, leasing or equipment financing institutions or other lending
institutions regularly engaged in the business of lending money (excluding debt
that is convertible or exercisable into equity through venture capital,
investment banking or similar institutions which sometimes engage in lending
activities but which are primarily engaged in investments in equity securities),
which is for money borrowed, or purchase or leasing of equipment in the case of
lease or other equipment financing, whether or not secured, and (ii) any such
indebtedness or any debentures, notes or other evidence of indebtedness issued
in exchange for such Senior Indebtedness, or any indebtedness arising from the
satisfaction of such Senior Indebtedness by a guarantor.

          (o)  "Subsidiary" shall mean (a) any corporation of which more than
50% of the issued and outstanding equity securities having ordinary voting power
to elect a majority of the Board of Directors of such corporation is at the time
directly or indirectly owned or controlled by Company, (b) any partnership,
joint venture, or other association of which more than 50% of the equity
interest having the power to vote, direct or control the management of such
partnership, joint venture or other association is at the time directly or
indirectly owned and controlled by Company, (c) any other entity included in the
financial statements of Company on a consolidated basis.

          (p)  "Transaction Documents" shall mean this Note and the Note
Purchase Agreement and any other documents that may be exchanged between Company
and Holder in connection with the issuance of the Note.

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     2.   Interest. The interest rate to be applied to the unpaid principal
          --------
balance of this Note shall be eight percent per annum. The interest rate on this
Note shall be increased in accordance with Section 15 upon the occurrence of an
Event of Default. In the event this Note is automatically converted into Common
Stock in accordance with Section 8(b), all interest accrued under this Note
shall be forgiven and Holder shall not be entitled to receive interest in cash
or in the form of Common Stock upon such conversion.

     3.   Prepayment. Upon fifteen days prior written notice to Holder, Company
          ----------
may prepay this Note in whole or in part, unless Holder elects to convert the
Note in accordance with Section 8(a) of this Note; provided that any such
prepayment will be applied first to the payment of expenses due under this Note,
second to interest accrued on this Note and third, if the amount of prepayment
exceeds the amount of all such expenses and accrued interest, to the payment of
principal of this Note.

     4.   Certain Covenants. While any amount is outstanding under the Note,
          -----------------
without the prior written consent of Holder:

          (a)  Dividends, Redemptions, Etc. Neither Company nor any of its
Subsidiaries shall (i) pay any dividends or make any distributions on its Equity
Securities; (ii) purchase, redeem, retire, defease or otherwise acquire for
value any of its equity securities, other than the repurchase of shares of
common stock under option agreements or restricted stock purchase agreements
with employees, directors or consultants; (iii) return any capital to any holder
of its equity securities; (iv) make any distribution of assets, Equity
Securities, obligations or securities to any holder of its Equity Securities; or
(v) set apart any sum for any such purpose; provided, however, that any
Subsidiary may pay cash dividends to Company.

          (b)  Indebtedness Payments. Neither Company nor any of its
Subsidiaries shall as to any Indebtedness which is not Senior Indebtedness (i)
prepay, redeem, purchase, defease or otherwise satisfy in any manner prior to
the scheduled repayment thereof any Indebtedness for borrowed money (other than
amounts due under this Note or the other Notes issued under the Note Purchase
Agreement) or lease obligations, (ii) amend, modify or otherwise change the
terms of any Indebtedness for borrowed money (other than the Obligations) or
lease obligations so as to accelerate the scheduled repayment thereof or (iii)
repay any principal or interest on any notes to officers, directors or
shareholders, including, without limitation, obligations to Odetics, Inc.

          (c)  Affiliate Transactions. Neither Company nor any of its
Subsidiaries shall enter into any contractual obligation with any Affiliate or
engage in any other transaction with any Affiliate except upon terms at least as
favorable to Company or such Subsidiary as an arms-length transaction with
unaffiliated Persons. Holder acknowledges and agrees that the Separation and
Distribution Agreement and the agreements contemplated thereby are on terms at
least as favorable to the Company as arms-length transactions with unaffiliated
Persons.

     5.   Events of Default. The occurrence of any of the following shall
          -----------------
constitute an "Event of Default" under this Note and the other Transaction
Documents. Promptly upon the occurrence thereof, the Company shall provide
Holder with written notice of the occurrence of any Event of Default hereunder
or any event of default with respect to any Senior Indebtedness.

          (a)  Failure to Pay. Company shall fail to pay (i) when due any
principal payment on the due date hereunder or (ii) any interest or other
payment required under the terms of

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this Note or any other Transaction Document on the date due and such payment
shall not have been made within five (5) days of Company's receipt of Holder's
written notice to Company of such failure to pay; or

          (b)  Other Payment Obligations. Company or any of its Subsidiaries
shall (i) fail to make any payment when due under the terms of any bond,
debenture, note or other evidence of Indebtedness, including the Senior
Indebtedness, to be paid by such Person (excluding this Note and the other
Transaction Documents but including any other evidence of Indebtedness of
Company or any of its Subsidiaries to Holder) and such failure shall continue
beyond any period of grace provided with respect thereto or thirty (30) days,
whichever is longer, or (ii) default in the observance or performance of any
other agreement, term or condition contained in any such bond, debenture, note
or other evidence of Indebtedness, and the effect of such failure or default is
to cause, or permit the holder or holders thereof to cause, Indebtedness in an
aggregate amount of One Hundred Thousand Dollars ($100,000) or more to become
due prior to its stated date of maturity; or

          (c)  Voluntary Bankruptcy or Insolvency Proceedings. Company or any of
its Subsidiaries shall (i) apply for or consent to the appointment of a
receiver, trustee, liquidator or custodian of itself or of all or a substantial
part of its property, (ii) be unable, or admit in writing its inability, to pay
its debts generally as they mature, (iii) make a general assignment for the
benefit of its or any of its creditors, (iv) be dissolved or liquidated, (v)
become insolvent (as such term may be defined or interpreted under any
applicable statute), (vi) commence a voluntary case or other proceeding seeking
liquidation, reorganization or other relief with respect to itself or its debts
under any bankruptcy, insolvency or other similar law now or hereafter in effect
or consent to any such relief or to the appointment of or taking possession of
its property by any official in an involuntary case or other proceeding
commenced against it, or (vii) take any action for the purpose of effecting any
of the foregoing; or

          (d)  Involuntary Bankruptcy or Insolvency Proceedings. Proceedings for
the appointment of a receiver, trustee, liquidator or custodian of Company or
any of its Subsidiaries or of all or a substantial part of the property thereof,
or an involuntary case or other proceedings seeking liquidation, reorganization
or other relief with respect to Company or any of its Subsidiaries or the debts
thereof under any bankruptcy, insolvency or other similar law now or hereafter
in effect shall be commenced and an order for relief entered or such proceeding
shall not be dismissed or discharged within thirty (30) days of commencement; or

          (e)  Judgments. A final judgment or order for the payment of money in
excess of One Hundred Thousand Dollars ($100,000) (exclusive of amounts covered
by insurance issued by an insurer not an Affiliate of Company) shall be rendered
against Company or any of its Subsidiaries and the same shall remain
undischarged for a period of thirty (30) days during which execution shall not
be effectively stayed, or any judgment, writ, assessment, warrant of attachment,
or execution or similar process shall be issued or levied against a substantial
part of the property of Company or any of its Subsidiaries and such judgment,
writ, or similar process shall not be released, stayed, vacated or otherwise
dismissed within thirty (30) days after issue or levy.

     6.   Rights of Holder upon Default. Upon the occurrence or existence of any
          -----------------------------
Event of Default (other than an Event of Default referred to in Sections 5(c)
                                                                -------------
and 5(d)) and at any time thereafter during the continuance of such Event of
--------
Default, Holder may, by written notice to Company, declare all outstanding
Obligations payable by Company hereunder to be immediately due and payable
without presentment, demand, protest or any other notice of any kind, all of
which are

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hereby expressly waived, anything contained herein or in the other Transaction
Documents to the contrary notwithstanding. In addition to the foregoing
remedies, upon the occurrence or existence of any Event of Default, Holder may
exercise any other right power or remedy granted to it by the Transaction
Documents or otherwise permitted to it by law, either by suit in equity or by
action at law, or both.

     7.   Subordination. The indebtedness evidenced by this Note is hereby
          -------------
expressly subordinated, to the extent and in the manner hereinafter set forth,
in right of payment to the prior payment in full of all of Company's Senior
Indebtedness.

          (a)  Insolvency Proceedings. If there shall occur any receivership,
insolvency, assignment for the benefit of creditors, bankruptcy, reorganization,
or arrangements with creditors (whether or not pursuant to bankruptcy or other
insolvency laws), sale of all or substantially all of the assets, dissolution,
liquidation, or any other marshaling of the assets and liabilities of Company,
(i) no amount shall be paid by Company in respect of the principal of, interest
on or other amounts due with respect to this Note at the time outstanding,
unless and until the principal of and interest on the Senior Indebtedness then
outstanding shall be paid in full, and (ii) no claim or proof of claim shall be
filed with Company by or on behalf of Holder of this Note which shall assert any
right to receive any payments in respect of the principal of and interest on
this Note except subject to the payment in full of the principal of and interest
on all of the Senior Indebtedness then outstanding.

          (b)  Default on Senior Indebtedness. If there shall occur an event of
default which has been declared in writing with respect to any Senior
Indebtedness, as defined therein, or in the instrument under which it is
outstanding, permitting the holder to accelerate the maturity thereof and Holder
shall have received written notice thereof from the holder of such Senior
Indebtedness, then, unless and until such event of default shall have been cured
or waived or shall have ceased to exist, or all Senior Indebtedness shall have
been paid in full, no payment shall be made in respect of the principal of or
interest on this Note, unless within one hundred eighty (180) days after the
happening of such event of default, the maturity of such Senior Indebtedness
shall not have been accelerated. Not more than one notice may be given to Holder
pursuant to the terms of this Section 7(b) during any 360 day period.
                              ------------

          (c)  Further Assurances. By acceptance of this Note, Holder agrees to
execute and deliver customary forms of subordination agreements requested from
time to time by holders of Senior Indebtedness, and as a condition to Holder's
rights hereunder, Company may require that Holder execute such forms of
subordination agreements; provided that such forms shall not impose on Holder
terms less favorable than those provided herein.

          (d)  Other Indebtedness. No indebtedness which does not constitute
Senior Indebtedness shall be senior in any respect to the indebtedness
represented by this Note.

          (e)  Subrogation. Subject to the payment in full of all Senior
Indebtedness, Holder shall be subrogated to the rights of the holder(s) of such
Senior Indebtedness (to the extent of the payments or distributions made to the
holder(s) of such Senior Indebtedness pursuant to the provisions of this Section
                                                                         -------
7) to receive payments and distributions of assets of Company applicable to the
-
Senior Indebtedness. No such payments or distributions applicable to the Senior
Indebtedness shall, as between Company and its creditors, other than the holders
of Senior Indebtedness and Holder, be deemed to be a payment by Company to or on
account of this Note; and for purposes of such subrogation, no payments or
distributions to the holders of Senior Indebtedness to which Holder

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would be entitled except for the provisions of this Section 7 shall, as between
Company and its creditors, other than the holders of Senior Indebtedness and
Holder, be deemed to be a payment by Company to or on account of the Senior
Indebtedness.

          (f)  No Impairment. Subject to the rights, if any, of the holders of
Senior Indebtedness under this Section 7 to receive cash, securities or other
properties otherwise payable or deliverable to Holder, nothing contained in this
Section 7 shall impair, as between Company and Holder, the obligation of
Company, subject to the terms and conditions hereof, to pay to Holder the
principal hereof and interest hereon as and when the same become due and
payable, or shall prevent Holder, upon default hereunder, from exercising all
rights, powers and remedies otherwise provided herein or by applicable law.

          (g)  Reliance of Holders of Senior Indebtedness. Holder, by its
acceptance hereof, shall be deemed to acknowledge and agree that the foregoing
subordination provisions are, and are intended to be, an inducement to and a
consideration of each holder of Senior Indebtedness, whether such Senior
Indebtedness was created or acquired before or after the creation of the
indebtedness evidenced by this Note, and each such holder of Senior Indebtedness
shall be deemed conclusively to have relied on such subordination provisions in
acquiring and holding, or in continuing to hold, such Senior Indebtedness.

     8.   Conversion.
          ----------

          (a)  Voluntary Conversion. Holder has the right, at Holder's option,
at any time prior to payment in full of this Note or conversion pursuant to
Section 8(b) below, to convert the Note at the office of the Company or any
transfer agent for the shares of Common Stock, into the number of shares of
Common Stock which is equal to the quotient obtained by dividing (A) the entire
unpaid amount of this Note, together with all accrued but unpaid interest and
other fees due under the Note, by (B) the Note Conversion Price. For purposes of
this Section 8(a), the "Note Conversion Price" shall be the fair market value of
the Common Stock at the time of conversion multiplied by .75. The fair market
value of the Common Stock at the time of conversion shall be determined by
mutual agreement of the Holder and the Company, and if no such agreement can be
reached in good faith, by Bear, Stearns & Co., Inc. If the fair market value is
determined by Bear, Stearns & Co. Inc., the Holder and the Company shall share
the burden of expenses incurred in making such determination equally.

          (b)  Automatic Conversion. The entire unpaid principal amount of this
Note, shall be automatically converted into Common Stock (subject to subsection
(c), below), immediately prior to (i) any consolidation or merger of Company
with or into any Person, any corporate reorganizations in which the Company
shall not be the continuing or surviving entity of such consolidation, merger or
reorganization and in which the holders of the outstanding voting capital stock
of the Company immediately prior to such consolidation, merger or reorganization
hold less than 50% of the outstanding voting capital stock of the surviving
company immediately following such transaction, any transaction or series of
related transactions by Company in which in excess of 50% of Company's voting
power is transferred or a sale of all or substantially all of the assets of
Company (each, a "Sale Transaction"); or (ii) the closing of a firmly
underwritten public offering pursuant to a registration statement filed by
Company under the Securities Act of 1933, as amended (the "Act"), with aggregate
gross proceeds in excess of $20 million and at a price of not less than $10.00
per share of Common Stock (as presently constituted, subject to proportionate
adjustment in the event of any stock split, stock dividend, reverse stock split,
combination, consolidation, reclassification or

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similar event) (a "Qualified Public Offering"). The number of shares into which
this Note shall be converted in the event of an automatic conversion pursuant to
this Section 8(b) shall be equal to the product of (A) .025 multiplied by (B)
the number of issued and outstanding shares of Common Stock of the Company at
the time of conversion, including shares of Common Stock issued upon conversion
of this Note and shares issued in a Qualified Public Offering, plus the number
of shares of Common Stock purchasable pursuant to outstanding options to
purchase Common Stock that are vested at the time of conversion.

          (c)  Adjustments for Valuation. In the event the Acquisition Value of
the Company is less than $200 million, Holder shall elect at the time of
conversion to either (1) receive a cash payment, representing a return of
principal, equal to an amount calculated under the following formula (the "Cash
Payment"):

          Outstanding principal amount under this Note - [.75 * (Acquisition
Value * .025)]; or

(2) receive such number of additional shares of Common Stock equal to the number
of shares calculated under the following formula:

                                 Cash Payment
                                 ------------
                            Per Share Value * $.75

In the event the Acquisition Value of the Company is more than $200 million,
Holder shall either (1) pay an additional amount of cash to the Company on the
date of conversion equal to an amount calculated under the following formula
(the "Additional Payment"):

          [.75 * (Acquisition Value * .025)] - Outstanding principal amount
under this Note; or

(2) reduce the number of shares otherwise issuable under 8(b) by such number of
shares equal to the number of shares calculated under the following formula:

                              Additional Payment
                              ------------------
                            Per Share Value * $.75

     For purposes of this Section 8, the following terms shall have the meanings
set forth below:

     "Acquisition Value" means (a) in the event of a Qualified Public Offering,
the Total Market Capitalization of the Company plus the aggregate exercise price
of all options outstanding and that are vested on the date of conversion, and
(b) in the event of a Sale Transaction, the aggregate consideration being paid,
assuming the purchase of 100% of the capital stock or assets of the Company,
less liabilities not assumed in the Sale Transaction, and plus the aggregate
exercise price of all options outstanding and that are vested on the date of
conversion.

     "Per Share Value" means, in the event of a Qualified Public Offering, the
initial public offering price, and in the event of a Sale Transaction, the
Acquisition Value divided by the total number of shares of Common Stock
outstanding after giving effect to this conversion and including the total
number of shares issuable pursuant to options to purchase Common Stock of the
Company that are vested at the time of conversion.

                                       8
<PAGE>

          (d)  Adjustment for Stock Splits and Combinations. If the Company at
any time or from time to time after the date of this Note (the "Effective Date")
effects a division of the outstanding shares of Common Stock, then the Note
Conversion Price shall be proportionately decreased and, conversely, if this
Company at any time, or from time to time, after the Effective Date combines the
outstanding shares of Common Stock, then the Note Conversion Price shall be
proportionately increased. Any adjustment under this Section 8(d) shall be
                                                     ------------
effective on the close of business on the date such division or combination
becomes effective.

          (e)  Adjustment for Certain Dividends and Distributions. If the
Company at any time or from time to time after the Effective Date pays or fixes
a record date for the determination of holders of shares of Common Stock
entitled to receive a dividend or other distribution in the form of shares of
Common Stock, or rights or options for the purchase of, or securities
convertible into, Common Stock, then in each such event the Note Conversion
Price shall be decreased, as of the time of such payment or, in the event a
record date is fixed, as of the close of business of such record date, by
multiplying the Note Conversion Price by a fraction (i) the numerator of which
shall be the total number of shares of Common Stock outstanding immediately
prior to the time of such payment or the close of business on such record date,
as the case may be, and (ii) the denominator of which shall be the sum of (A)
                                                               ----------
the total number of shares of Common Stock outstanding immediately prior to the
time of such payment or the close of business on such record date, as the case
may be, plus (B) the number of shares of Common Stock issuable in payment of
        ----
such dividend or distribution or upon exercise of such option or right of
conversion; provided, however, that if a record date is fixed and such dividend
is not fully paid or such other distribution is not fully made on the date fixed
therefor, then the Note Conversion Price shall not be decreased as of the close
of business on such record date as hereinabove provided as to the portion not
fully paid or distributed and thereafter the Note Conversion Price shall be
decreased pursuant to this Section 8(e) as of the date or dates of actual
                           ------------
payment of such dividend or distribution.

          (f)  Adjustments for Other Dividends and Distributions. If the Company
at any time or from time to time after the Effective Date pays, or fixes a
record date for the determination of holders of shares of Common Stock entitled
to receive, a dividend or other distribution in the form of securities of the
Company other than shares of Common Stock or rights or options for the purchase
of, or securities convertible into, Common Stock, then in each such event
provision shall be made so that the Holder shall receive upon conversion
thereof, in addition to the number of shares of Common Stock receivable
thereupon, the amount of securities of the Company which they would have
received had the Note been converted into shares of Common Stock on the date one
day before such event (adjusted to account for any additional accrued by unpaid
interest and other fees due under the Note) and had Holder thereafter, from the
date of such event to and including the actual date of conversion of their
shares, retained such securities, subject to all other adjustments called for
during such period under this Section 8 with respect to the rights of the
                              ---------
Holder.

          (g)  Adjustment for Reclassification, Exchange and Substitution. If at
any time or from time to time after the Effective Date the number of shares of
Common Stock issuable upon conversion of the Note, is changed into the same or a
different number of shares of any other class or classes of stock or other
securities, whether by recapitalization, reclassification or otherwise (other
than a recapitalization, division or combination of shares or a stock dividend,
or a reorganization, merger, consolidation or sale of assets provided for
elsewhere in this Section 8), then in any such event the Holder shall have the
right thereafter to convert the Note into the same kind and amount of stock and
other securities receivable upon such recapitalization, reclassification or
other change, as the maximum number of shares of Common Stock into which the
Note, could have been converted

                                       9
<PAGE>

immediately prior to such recapitalization (adjusted to account for any
additional accrued but unpaid interest and other fees due under the Note),
reclassification or change, all subject to further adjustment as provided
herein.

          (h)  Reorganizations, Mergers, Consolidations or Sales of Assets. If
at any time or from time to time after the Effective Date there is a capital
reorganization of the Common Stock (other than a recapitalization, division,
combination, reclassification or exchange of shares provided for elsewhere in
this Section 8) or a merger or consolidation of this Company into or with
another corporation (except as provided for in section 8(b)), then, as a part of
such capital reorganization, merger or consolidation, provision shall be made so
that the Holder shall thereafter receive upon conversion thereof the number of
shares of stock or other securities or property of this Company, or of the
successor corporation resulting from such merger or consolidation or sale, to
which a holder of the number of shares of Common Stock into which the Note would
have been entitled on such capital reorganization, merger, consolidation or sale
(adjusted to account for any additional accrued but unpaid interest and other
fees due under the Note). In any such case, appropriate adjustment shall be made
in the application of the provisions of this Section 8 with respect to the
                                             ---------
rights of the Holder after such capital reorganization, merger, consolidation,
or sale. The provisions of this Section 8 (including adjustment of the Note
                                ---------
Conversion Price and the number of shares into which the Note may be converted)
shall be applicable after that event and be as nearly equivalent to such
Conversion Prices and number of shares as may be practicable.

          (i)  Conversion Procedure.

               (i)  Conversion Pursuant to Section 8(a). Before Holder shall be
                    -----------------------------------
     entitled to convert this Note into Common Stock, it shall surrender this
     Note, duly endorsed, at the office of Company and shall give written notice
     by registered or certified mail, postage prepaid, to Company at its
     principal corporate office, of the election to convert the same pursuant to
     Section 8(a), and shall state therein the name or names in which the
     ------------
     certificate or certificates for the Common Stock are to be issued. Company
     shall, as soon as practicable thereafter, issue and deliver at such office
     to Holder of this Note a certificate or certificates for the Common Stock
     to which Holder shall be entitled upon conversion (bearing such legends as
     are required by the Note Purchase Agreement and applicable state and
     federal securities laws in the opinion of counsel to Company), and any
     other securities and property to which Holder is entitled upon such
     conversion under the terms of this Note. The conversion shall be deemed to
     have been made immediately prior to the close of business on the date of
     the surrender of this Note, and the Person or Persons entitled to receive
     the Common Stock upon such conversion shall be treated for all purposes as
     the record holder or holders of such shares of Common Stock as of such
     date.

               (ii) Conversion Pursuant to Section 8(b). If this Note is
                    -----------------------------------
     automatically converted, written notice shall be delivered to Holder at the
     address last shown on the records of Company for Holder or given by Holder
     to Company for the purpose of notice or, if no such address appears or is
     given, at the place where the principal executive office of Company is
     located, notifying Holder of the conversion to be effected, the amount and
     kind of Common Stock to be issued upon conversion, the date on which such
     conversion is expected to occur and calling upon such Holder to surrender
     to Company, in the manner and at the place designated, the Note. Upon such
     conversion of this Note, Holder shall surrender this Note, duly endorsed,
     at the principal office of Company. At its expense, Company shall, as soon
     as practicable thereafter, issue and deliver to such Holder at such
     principal office a

                                       10
<PAGE>

     certificate or certificates for the Common Stock to which Holder shall be
     entitled upon such conversion (bearing such legends as are required by the
     Note Purchase Agreement and applicable state and federal securities laws in
     the opinion of counsel to Company), together with any other securities and
     property to which Holder is entitled upon such conversion under the terms
     of this Note. Any conversion of this Note pursuant to Section 8(b) shall be
                                                           ------------
     deemed to have been made immediately prior to the closing of the issuance
     and sale of Common Stock as described in Section 8(b) and on and after such
     date the Persons entitled to receive the Common Stock issuable upon such
     conversion shall be treated for all purposes as the record Holder of such
     Common Stock and a purchaser of such Common Stock under the Note Purchase
     Agreement and shall be bound by the terms of the Note Purchase Agreement.

          (j)  Fractional Shares; Effect of Conversion. The Company may, but
shall not be obligated to, issue any fractional shares upon conversion of this
Note. In the event that Company elects not to issue fractional shares, Company
shall round the number of shares to the nearest whole share of each type of
Common Stock, provided that if such rounding would result in holder receiving
less than 99.9% of the amount of such Common Stock to which he is entitled,
pursuant to this Section 8, such fraction shall be rounded up to the next whole
                 ---------
share of Common Stock.

          (k)  Reservation of Stock Issuable Upon Conversion. The Company shall
at all times reserve and keep available out of its authorized but unissued
shares of Common Stock, solely for the purpose of effecting the conversion of
this Note, such number of shares of Common Stock as shall from time to time be
sufficient to effect the conversion of the Note.

     9.   Successors and Assigns. Subject to the restrictions on transfer
          ----------------------
described in the Note Purchase Agreement, the rights and obligations of Company
and Holder of this Note shall be binding upon and benefit the successors,
assigns, heirs, administrators and transferees of the parties.

     10.  Assignment by Company. Neither this Note nor any of the rights,
          ---------------------
interests or obligations hereunder may be assigned, by operation of law or
otherwise, in whole or in part, by Company without the prior written consent of
Holder.

     11.  Waiver. Company hereby waives presentment, demand, or protest and any
          ------
notice of any kind in connection with the delivery, acceptance, performance,
default, acceleration, or collection of this Note.

     12.  Notices. Any notice, request or other communication required or
          -------
permitted hereunder shall be in writing and shall be deemed to have been duly
given if personally delivered or mailed by recognized overnight courier or
personal delivery at the respective addresses of the parties as set forth in the
Note Purchase Agreement or on the register maintained by Company. Any party
hereto may by notice so given change its address for future notice hereunder.
Notice shall conclusively be deemed to have been given when received.

     13.  No Intent of Usury. It is the express intentions of the parties that
          ------------------
the payments under this Note are based upon the success and profitability of a
speculative venture, and are therefore exempt from applicable usury
restrictions. Holder understands and acknowledges that all payments under this
Note are contingent upon the profitability of the Company. Nothing contained in
this Note or in the Agreement shall be deemed to require the payment by the
Company or the retention by Holder of interest in excess of the maximum legal
rate (the "Maximum Legal Rate"). All agreements between Holder and Company
pertaining to the obligation evidenced hereby (the "Loan") are expressly limited

                                       11
<PAGE>

so that in no contingency or event, whether by reason of acceleration of the
maturity of the Loan or otherwise, shall the amount paid or agreed to be paid to
Holder for the use, forbearance, or detention of money to be loaned hereunder
exceed the Maximum Legal Rate. If, under any circumstance whatsoever, the
fulfillment of any provision of this Note or the Agreement shall involve
transcending the limits of validity prescribed by law, then, ipso facto, the
                                                             ---- -----
obligation to be fulfilled by Company shall be reduced to the limit of such
validity. This provision shall control every provision of all agreements between
Company and Holder. In the event at any time the interest paid shall exceed the
Maximum Legal Rate, the excess amount shall be deemed to be held in trust by
Holder for the exclusive use and benefit of Company; provided, however, that
such amounts held in trust may be applied to interest or other lawful
consideration payable under the terms of this Note and the Agreement if such
amounts can be so applied without violating applicable laws and without
exceeding the Maximum Legal Rate. Holder may commingle any such amounts with its
own funds. If at the time the Note is paid, the total amount deemed to be
interest under applicable laws exceeds the Maximum Legal Rate, the maximum
liability of Company shall be expressly limited to the legal maximum amounts,
and in the event any excess sums have been paid or are payable such amounts
shall be promptly repaid or credited to Company. In the event the interest or
other consideration payable by Company hereunder is exempt from applicable usury
statutes, or for any other reason is not limited by law, none of the provisions
of this paragraph shall be construed so as to limit the interest or other
consideration payable under the terms of this Note or the Agreement.

     14.  Payment. Payment shall be made in lawful tender of the United States.
          -------

     15.  Default Rate, Usury. In the event that any payment of principal or
          -------------------
interest provided for herein is not paid by Company when due (including the
entire unpaid balance of this Note in the event such amount is made immediately
due and payable pursuant to the terms hereof), then Company shall pay interest
after the date of default on such amounts not paid when due at a rate per annum
equal to the rate otherwise applicable hereunder plus four percent (4%). In the
event any interest is paid on this Note which is deemed to be in excess of the
then legal maximum rate, then that portion of the interest payment representing
an amount in excess of the then legal maximum rate shall be deemed a payment of
principal and applied against the principal of this Note.

     16.  Expenses. If action is instituted to collect this Note, Company
          --------
promises to pay all costs and expenses, including, without limitation,
reasonable attorneys' fees and costs, incurred in connection with such action if
Holder prevails.

     17.  Governing Law. This Note and all actions arising out of or in
          -------------
connection with this Note shall be governed by and construed in accordance with
the laws of the State of California, without regard to the conflicts of law
provisions of the State of California, or of any other state.

                                       12
<PAGE>

          IN WITNESS WHEREOF, Company has caused this Note to be issued as of
the date first written above.

                                        ITERIS, INC.
                                        a Delaware corporation

                                        By: /s/ Jack Johnson
                                            ----------------
                                            Jack Johnson, President

                                       13Exhibit 10.6

                      CONDITIONAL LICENSE AGREEMENT

     THIS CONDITIONAL LICENSE AGREEMENT ("Agreement") is made and entered
into as of the 24th day of February, 2000 ("Effective Date"), by and
between, on the one hand, Allen D. Allen ("Allen") and CytoDyn of New
Mexico, Inc., a New Mexico corporation ("CytoDyn") (Allen and CytoDyn are
individually and collectively referred to herein as "Inventor"), and, on
the other hand, Amerimmune, Inc., a Colorado corporation ("Amerimmune").

                                RECITALS
                                --------

     A.   Inventor has developed certain technology that is more
specifically described on Exhibit A hereto (the "Technology") and claims
rights to the trademarks CYTODYN and CYTOLIN and the goodwill associated
therewith and registrations and applications for registration thereof (the
"Marks").

     B.   Inventor has previously entered into a Termination, Sale and
Shareholder Agreement dated August 1, 1998 with Three R Associates, Inc.,
a California corporation ("3R"), concerning the assignment to 3R of all
rights of Inventor in and to the Technology and the Marks.

     C.   Pursuant to that certain Patent and Trademark License Agreement,
dated October 24, 1998 between 3R and Amerimmune (the "3R License
Agreement"), Amerimmune has received a worldwide exclusive right and
license in and to the Technology and the Marks from 3R.

     D.   Inventor has represented to Amerimmune that circumstances have
arisen leading Inventor to question Inventor's transfer, if any, of the
Technology and the Marks to 3R.

     E.   In the event that Inventor's transfer of rights to the Technology
and the Marks to 3R was ineffective, invalid or in any manner inoperative,
or in the event that rights in and to the Technology and the Marks
otherwise revert to or are acquired by Inventor, Amerimmune desires to
obtain from Inventor, and Inventor is willing to grant to Amerimmune, an
exclusive worldwide license in and to the Technology and the Marks on the
terms contained in this Agreement.

     NOW, THEREFORE, in consideration of the premises and the mutual
covenants contained herein, the parties hereto hereby agree as follows:

1.  DEFINITIONS.  The following terms shall have the following meanings for
purposes of this Agreement:

     1.1  ALLEN.  "Allen" shall mean Allen D. Allen.

     1.2  AMERIMMUNE.  "Amerimmune" shall mean Amerimmune, Inc., a Colorado
corporation which is a wholly owned subsidiary of API.

     1.3  API.      "API" shall mean Amerimmune Pharmaceuticals, Inc., a
Colorado corporation.

                                    1
<PAGE>
     1.4  CONFIDENTIAL INFORMATION.  "Confidential Information" shall mean
(i) the Know-How and the Trade Secrets, as defined in Exhibit A attached
hereto, and (ii) all confidential information or trade secrets of, on the
one hand, Amerimmune or its affiliates, including without limitation API,
and, on the other hand, Inventor or its affiliates, disclosed orally, in
writing or otherwise by one party to the other party, or to their
respective affiliates, officers, agents or employees.  In order to be
included in "Confidential Information" pursuant to (ii) in the preceding
sentence, the disclosing party must mark written disclosures as
"Confidential" or must give written notice identifying the Confidential
Information within five (5) business days after the disclosure.
"Confidential Information" shall not be deemed to include information that
is publicly known or that becomes publicly known through no fault of
Inventor (with respect to Amerimmune's Confidential Information), or
through no fault of Amerimmune (with respect to Inventor's Confidential
Information).

     1.5  INVENTOR.  "Inventor" shall mean Allen and CytoDyn of New Mexico,
Inc. a New Mexico corporation, individually and collectively.

     1.6  LICENSE.  "License" shall mean the license granted pursuant to
Section 2.1 hereof.

     1.7  LICENSE CONDITION.  "License Condition" shall mean that
Inventor's transfer of rights to the Technology and the Marks to 3R is held
by a court or arbitrator of competent jurisdiction, or by agreement between
Inventor and 3R, to have been ineffective, invalid or in any manner
inoperative, or the rights in and to the Technology and the Marks otherwise
revert to or are acquired by Inventor.

     1.8  LICENSED PRODUCTS.  "Licensed Products" shall mean all products
and/or services that (i) are developed, manufactured, marketed,
distributed, imported and/or sold by Amerimmune or its successors, assigns
and/or sublicensees, in connection with the Marks, and/or (ii) incorporate
or utilize or are manufactured using any of the Technology.

     1.9  LOAN AGREEMENT.  "Loan Agreement" shall mean the Amendment to
Loan Documents of even date herewith between Amerimmune and Allen attached
hereto as Exhibit B.

     1.10 MARKS.  "Marks" shall mean all worldwide rights in and to the
marks CYTODYN and CYTOLIN and all goodwill appurtenant thereto and all
present and future U.S. and foreign registrations and applications for
registration thereof, any corporate names and trade names for terms similar
to CYTODYN and CYTOLIN, and the domain name registration for CYTOLIN.

     1.11 TECHNOLOGY.  "Technology" shall have the meaning set forth on
Exhibit A attached hereto.

     1.12 TERM.  "Term" shall mean the period set forth in Section 11 hereof.

     1.13 3R.  "3R" shall mean Three R Associates, Inc., a California
corporation.

                                    2
<PAGE>
     1.14 3R LICENSE AGREEMENT.  "3R License Agreement" shall mean that
certain Patent and Trademark License Agreement dated October 28, 1998
between 3R and Amerimmune.

2.   LICENSE OF RIGHTS TO MARK AND TECHNOLOGY

     2.1  LICENSE.  In the event that the License Condition is satisfied,
Inventor shall be deemed to have granted to Amerimmune, and Amerimmune
shall be deemed to have accepted, an irrevocable (subject to the terms of
this Agreement), exclusive, worldwide right, license and privilege
(including the right to sublicense subject to the terms of this Agreement)
to use the Marks and the Technology (as now owned or hereafter acquired by
Inventor or Inventor's successors or assigns) during the Term in connection
with the development, manufacture, use, marketing, distribution, import,
offer for sale and/or sale of Licensed Products.  Except as otherwise set
forth herein, the foregoing license shall be exclusive even with respect to
Inventor, and Amerimmune shall have the right to use such names and marks,
including without limitation the Marks, in connection with labeling,
packaging and advertising the Licensed Products, as Amerimmune shall
determine in its sole discretion; but (i) nothing contained herein shall be
construed to require CytoDyn to change its corporate name or to prevent
CytoDyn from utilizing "CytoDyn" as its corporate name or as an Internet
domain name, and (ii) neither Amerimmune nor Inventor shall use "cytolin"
in whole or part as an active Internet domain name, but either may use the
term "CYTOLIN" in articles and discussions appearing at their respective
web sites.  Amerimmune may use Allen's name and bibliography and biography
(as permitted by law) in promoting Licensed Products, but shall take
reasonable steps to ensure that any such uses preserve Allen's good reputation.

     2.2  FURTHER ASSURANCES; COOPERATION.

          (a) NOTIFICATION.  Inventor shall immediately notify Amerimmune
in writing in the event of the (i) transfer or reversion of any of the
Technology or Marks to, or the acquisition of any of the Technology or
Marks by, Inventor or any affiliate of Inventor, or (ii) acquisition by
Inventor or any affiliate of Inventor from 3R of any capital stock or any
proxy (including without limitation a return of any proxy previously
granted to 3R) or other right to vote the stock of API and/or Amerimmune.

          (b) COOPERATION.  Inventor shall execute such documents and
instruments as Amerimmune shall reasonably request from time to time to
confirm the license herein granted, and may cause such documents or
instruments to be recorded in the records of the United States Patent and
Trademark Office ("PTO") and such other offices as Amerimmune shall deem
appropriate.

          (c) DOCUMENTATION.  From time to time following execution of this
Agreement, Inventor shall furnish to Amerimmune all information and
documents regarding the Technology and the Marks, including without
limitation research and development reports and all other data relating to
the Technology, as shall be reasonably requested by Amerimmune.

     2.3  PATENT MARKING.  Amerimmune shall mark all Licenced Products or
the packaging for such Licensed Products with patent numbers in accordance
with statutory requirements and prudent practice pursuant to industry
standards and, pending the issue of any patents covering the Licenced
Products, shall cause the term "Patent Pending" to appear on such Licensed
Products or the packaging for such Licensed Products.

                                    3
<PAGE>
     2.4  PROTECTION OF RIGHTS.

          (a) PROSECUTION.  Amerimmune may apply for patent and trademark
protection for the Technology and the Marks in the name of Inventor in all
countries of the world, or Inventor shall file such applications in
Inventor's name as Amerimmune shall reasonably request, all of which shall
be subject to the License, using counsel of Amerimmune's choice.  Inventor
shall diligently prosecute and maintain or, at Amerimmune's election, shall
cooperate with Amerimmune in prosecuting and maintaining all such patent
and trademark applications, patents and trademark registrations, using
counsel of Amerimmune's choice.  Inventor shall execute all papers,
documents and instruments necessary to enable Amerimmune to cause to be
prepared, filed and prosecuted, such applications for letters patent and
trademark registration in such countries of the world as Amerimmune shall,
in its sole discretion, determine is advisable.  Notwithstanding anything
else contained in this Agreement, neither Amerimmune/API nor a patent or
trademark attorney or agent used by Amerimmune/API pursuant to this
Agreement shall have power of attorney to assign, transfer, sell or
register, the patents or Marks owned by or applied for in the name of
Inventor.  The patent attorney used by Amerimmune pursuant to this
paragraph shall possess the specialized qualifications enumerated in Exhibit F.

          (b) NOTICES.  Throughout the Term, Inventor shall promptly notify
Amerimmune in writing of all patent and trademark applications, patents,
and trademark registrations with respect to any of the Marks or the
Technology that are being prosecuted or maintained by Inventor, and all
changes of status of any such applications or registrations, accompanied by
complete and accurate copies of all documents pertaining thereto.  Within
a reasonable period of time before deadlines or due dates relating to any
such patent and trademark applications, patents and trademark, Inventor
shall provide Amerimmune with copies of all relevant documentation so that
Amerimmune may be informed and apprised of the continuing prosecution and
maintenance, and may provide substantive comment and input thereon.  In the
event that Amerimmune from time to time during the Term provides directions
to Inventor in connection with prosecution and maintenance of such patent
and trademark applications, patents and trademark registrations, Inventor
shall comply with the directions given by Amerimmune, provided such
directions are reasonable.

          (c) REIMBURSEMENT.  Amerimmune shall directly pay or shall
reimburse Inventor for all fees and costs (including but not limited to
attorneys', engineering and drafting fees) that are authorized in advance
by Amerimmune for preparing, filing, prosecuting and maintaining the patent
and trademark applications, patents and trademark registrations covering
the Technology and the Marks.  Inventor shall provide Amerimmune with
documentation to support these costs upon request of Amerimmune.  Inventor
shall provide periodic statements to Amerimmune showing the amount to be
reimbursed to Inventor under the provisions of this Section 2.4(d).
Payment to Inventor shall be due within thirty (30) days of the date of
these statements.  If Amerimmune does not reimburse Inventor or notify
Inventor in writing of a good faith dispute over the amount required to be
reimbursed within thirty (30) days of receipt of a statement from Inventor,
Inventor shall have the right to give Written Notice pursuant to Section
11.2 hereof to terminate the License with respect to such patent or
trademark application, patent, or trademark registration for which
reimbursement has not been paid.

                                    4
<PAGE>
3.   CONSIDERATION

     In consideration for entering into this Agreement, Amerimmune has
agreed to advance an additional $50,000 to Inventor pursuant to the terms
of the Loan Agreement.  In addition, as consideration for the License, upon
Inventor's delivery to Amerimmune of evidence satisfactory to Amerimmune
that (i) the License Condition has been satisfied with respect to all of
the Technology and the Marks, and that (ii) Amerimmune's obligations under
the 3R License Agreement have terminated, Amerimmune agrees to continue to
pay to Inventor directly the consideration provided for in Section 4(b) of
the 3R License Agreement and Section 2 of Letter Agreement dated August 1,
1998 (which Section, together with the definitions for "Inventor" and
"Licensee" from the 3R License Agreement and Letter Agreement, both
attached hereto as Exhibit C and are herein incorporated by reference) and
to take such other actions as are provided for in Exhibit D attached hereto.

4.   SURRENDER OF STOCK

     In the event that Inventor hereafter directly or indirectly acquires,
purchases (other than bona fide cash purchases of API common stock in the
open market at prevailing market prices), is awarded or otherwise receives
from 3R, the current stockholders of 3R, or their respective affiliates or
successors in interest any shares of capital stock of API and/or
Amerimmune, Inventor shall immediately for no additional consideration
surrender to API and/or Amerimmune, as applicable, all such shares of
capital stock of API and/or Amerimmune for return to treasury stock.

5.   CONFIDENTIALITY

     Each of Amerimmune and Inventor shall regard and preserve the
Confidential Information of the other party as secret and confidential, and
shall not publish or disclose any Confidential Information in any manner
without the prior written consent of the other party.  Each of Amerimmune
and Inventor shall use the same level of care to prevent the disclosure of
the other party's  Confidential Information that it exercises in protecting
its own Confidential Information and shall in any event take all reasonable
precautions to prevent the disclosure of Confidential Information to any
third party.  Except as otherwise provided herein, before disclosing
Confidential Information to a third party ("Recipient"), the disclosing
party shall obtain a written commitment from the Recipient to observe the
confidentiality provisions of this Section 5.  Each party acknowledges and
agrees that, in addition to any other available rights or remedies, a
disclosing party shall be entitled to specific performance, injunctive
relief and any other equitable remedy for the breach or default or
threatened breach or default of this Section 5 and waives any defense that
a remedy at law or damages is adequate.  In addition to the confidentiality
provisions described above, Inventor agrees to be bound by the
confidentiality provisions contained in Exhibit G attached hereto.  Neither
party shall publicize the terms of this Agreement without the prior written
consent of the other party (except as required in connection with any legal
proceeding or arbitration, as required by law, or to the extent reasonably
required in connection with any merger, acquisition, reorganization,
capital or financing transaction), but each party shall have the right to
publicize the existence of this Agreement.  Inventor shall have the right
to publish the results of any studies and/or trials in connection with the
Technology that confirms (as opposed to that contradicts) information or
study results already in the public domain.

                                    5
<PAGE>
6.   QUALITY CONTROL

     Amerimmune agrees to maintain reasonable quality standards common in
the industry for the Licensed Products to be distributed or sold by
Amerimmune in connection with any of the Marks or Technology, and
Amerimmune agrees to manufacture or have manufactured such Licenced
Products in accordance with such standards.  Inventor or its designated
representatives shall have the right to inspect the materials,
manufacturing sites and processes employed by Amerimmune in connection
with, and samples of, such Licensed Products to assure Inventor that such
quality standards are being complied with.  Any such inspection shall be
preceded by at least two (2) full business days' advance written notice,
and shall be at Inventor's sole cost and expense.

7.   IMPROVEMENTS

     Amerimmune shall have the right to improve the Technology through its
own research and development.  All such improvements that do not infringe
the claims of the Patents shall be the property of Amerimmune, and
improvements that infringe the claims of the Patents shall be the property
of Inventor, but shall be subject to the License.  Amerimmune and Inventor
shall each promptly notify the other of improvements to the Technology
which either party shall invent, create, develop or acquire during the Term.

8.   REPRESENTATIONS, WARRANTIES AND COVENANTS

     8.1  AUTHORITY.  Each party represents and warrants to the other party
that (i) this Agreement has been duly authorized, executed and delivered by
it and that this Agreement is a binding obligation of it, enforceable in
accordance with its terms, subject, as to enforcement of remedies, to
applicable bankruptcy, insolvency, moratorium, reorganization or other
similar laws affecting creditors' rights generally, and to general
equitable principles, and (ii) such party's performance under this
Agreement will not violate any agreement with any third party or any
federal, state or local law or regulation.

     8.2  TITLE; VALIDITY; INFRINGEMENT.  Inventor represents, warrants and
covenants to Amerimmune that: (i) Inventor is the sole inventor of the
inventions included in the Technology; (ii) except for rights claimed by
3R, Inventor is the sole owner of all right, title and interest in and to
the Technology and the Marks; (iii) Inventor has not done or omitted any
act, nor shall Inventor do or omit any act, which would impair the validity
of the Technology or the Marks or any part thereof or Inventor's ability to
effect the transactions contemplated by this Agreement; (iv) all of the
statements, declarations and claims made in any application for letters
patent included in the Technology are true and correct in all respects and
Inventor knows of no prior art not disclosed in such applications; (v)
except for rights claimed by 3R, Inventor has the sole right and full power
to license the Technology and the Marks to Amerimmune, and no consent of
any other party is necessary or appropriate to the consummation of the
transactions contemplated to be performed by Inventor under this Agreement;
(vi) with the exception of rights assigned by Inventor to 3R and licenses
that have heretofore been terminated in accordance with their terms,
Inventor has not granted, nor prior to or during the Term shall Inventor
grant, any interest in or to the Technology or the Marks by way of
assignment, license, encumbrance, obligation, agreement, security interest,
lien, option or otherwise to any third party; (vii)

                                    6
<PAGE>
to the best knowledge of Inventor and its officers and directors, the
Technology and the Marks, and Amerimmune's exploitation of the rights
licensed thereto pursuant to this Agreement, does not and will not infringe
any valid patent, trade secret, copyright, trademark or other proprietary
right of any third party; and (viii) Inventor and its officers and
directors are not aware of any present or potential third party
infringement of the Technology or the Marks, except as set forth on Exhibit
E attached hereto.

     8.3  CERTAIN REPRESENTATIONS, WARRANTIES AND COVENANTS OF AMERIMMUNE.
Amerimmune represents, warrants and covenants to Inventor that:
(i) Amerimmune has not done or omitted any act, nor shall Amerimmune do or
omit any act, which would impair the validity of the Technology or any part
thereof or Amerimmune's ability to effect the transactions contemplated by
this Agreement; (ii) Amerimmune has not sublicensed any interest in or to
the Technology or the Marks to any third party; and (iii) Amerimmune and
its officers and directors are not aware of any present or potential third
party infringement of the Technology.

     8.4  ACKNOWLEDGMENT BY AMERIMMUNE.  Amerimmune acknowledges that
Inventor has advised Amerimmune that a license from Coulter Immunology,
Inc. may be required for Amerimmune to manufacture S6F1 Antibodies.

9.   INFRINGEMENT

     9.1  THIRD PARTY INFRINGEMENT.  If Inventor learns of facts that it
concludes may constitute an infringement of any of the Technology or the
Marks by any third party, Inventor shall promptly notify Amerimmune in
writing, setting forth such facts and the basis for its conclusion, and
shall include with such notice any other reasonably available evidence in
support thereof.

          (a) SUBSTANTIAL INFRINGEMENTS.  Amerimmune shall take appropriate
action at Amerimmune's expense against "Substantial Infringements" of the
Technology or the Marks (including without limitation filing a lawsuit or
arbitration against such third party infringer, if necessary).  For
purposes hereof, a "Substantial Infringement" shall be an infringement of
Technology or Marks (i) where failure by Amerimmune to take appropriate
action against such infringement would result in partial or total loss or
abandonment of rights to the infringed Technology and/or Marks, or (ii) if
the infringement has resulted in more than a 25% reduction in sales of
Licenced Products in any country after introduction into the market in such
country of the infringing product.  Unless Inventor agrees otherwise in
writing, Amerimmune's failure to commence appropriate action against a
Substantial Infringement within thirty (30) days after learning or
receiving written notice of such infringement shall result in the
termination of the License in such country with respect to the Marks (if
one of the Marks is the subject of such Substantial Infringement) or the
infringed Technology.

          (b) OTHER INFRINGEMENTS.  Amerimmune shall have the right, but
not the obligation, at Amerimmune's expense to take such action against
infringements other than Substantial Infringements as Amerimmune deems
appropriate.  If Amerimmune declines to take action (i.e., send demand
letter, file lawsuit) against an infringer within thirty (30) days of
receipt of notice thereof from Inventor, Inventor shall have the right to
take action against such infringer upon giving Amerimmune at least fifteen
(15) days prior written notice.  Amerimmune shall have the right to
participate in such

                                    7
<PAGE>
action, at Amerimmune's expense.  Inventor shall not settle any action
against a third party infringer of the Technology or the Marks without
Amerimmune's prior written consent, which consent shall not be unreasonably
withheld.

          (c) RECOVERY.  Amerimmune shall be entitled to any monetary
award, judgment or settlement resulting from action brought or taken by
Amerimmune against a third party infringer.  Inventor shall be entitled to
any monetary award, judgment or settlement resulting from action brought or
taken by Inventor against a third party infringer.  Any monetary award,
judgment or settlement resulting from action brought or taken jointly by
Amerimmune and Inventor shall be divided between Amerimmune and Inventor
PARI PASSU based on each party's financial contribution towards such result.

     9.2  NOMINAL PLAINTIFF.  If any infringement action, suit or
proceeding is brought hereunder by Amerimmune to enforce any rights in the
Technology or the Marks, Inventor shall upon the request and at the expense
of Amerimmune, cooperate with Amerimmune and be named, joined and
participate therein as a nominal plaintiff.

10.  INDEMNIFICATION

     10.1 INVENTOR INDEMNIFICATION.  Inventor shall indemnify, hold
harmless and defend Amerimmune and its officers, directors, employees,
representatives and agents, from and against any and all claims, demands,
lawsuits, actions, proceedings, liabilities, losses, damages, fees, costs
and expenses (including without limitation attorneys' fees and costs of
investigation and experts) resulting from or arising out of (i) any breach
by Inventor of this Agreement, including without limitation any breach of
the representations, warranties and covenants of Inventor hereunder, (ii)
any claim by 3R or any other party that this Agreement represents an
interference with a contractual relationship or otherwise violates such
party's rights, or (iii) any claim that Amerimmune's exploitation of any
rights in the Technology and the Marks herein licensed infringes or
violates any patent, copyright, trademark or other right of any third party
unless any such infringement or violation is due to actions or inactions by
Amerimmune other than by reason of Amerimmune's exercise of its rights
licensed pursuant to this Agreement; but Amerimmune shall not be entitled
to indemnification hereunder for infringement exclusively resulting from
Amerimmune's improvements to the Technology.

     10.2 AMERIMMUNE INDEMNIFICATION.  Amerimmune shall indemnify, hold
harmless and defend Inventor and its officers, directors, employees,
representatives and agents, from and against any and all claims, demands,
lawsuits, actions, proceedings, liabilities, losses, damages, fees, costs
and expenses (including without limitation attorneys' fees and costs of
investigation and experts) resulting from or arising out of (i) any breach
by Amerimmune of this Agreement, including without limitation any breach of
the representations, warranties and covenants of Amerimmune hereunder, and
(ii) the use of the Licensed Products (including without limitations any
product liability claims) and/or the development, manufacture, marketing,
distribution and/or sale by Amerimmune of the Licensed Products (except for
infringement claims covered by Section 10.1(iii) above).  In addition,
Amerimmune shall require any sublicensee to agree to indemnify Inventor
from and against all product liability claims by persons purchasing
Licensed Products from such sublicensee and/or its agents or distributors.

                                    8
<PAGE>
11.  TERM.

     11.1 TERM.  The term of the License shall commence as of the later of
(i) the date first above written, or (ii) the date that the License
Condition is satisfied, and shall terminate (i) with respect to the Patents
or any other patents covered by this Agreement, upon the expiration of the
last to expire of such Patents or patents; (ii) with respect to the Know-how
and Trade Secrets, and any improvements thereto, and the Marks, upon
termination of this Agreement as provided in Section 11.2 below, it being
the intent of the parties that, absent such termination, the license with
respect to such Know-how, Trade Secrets, and any improvements thereto, and
Marks shall be in perpetuity.

     11.2 TERMINATION.  Inventor may terminate the License for a material
breach of this Agreement by Amerimmune by delivering written notice to
Amerimmune setting forth that Amerimmune is in material breach of this
Agreement and specific statements of such material breach or breaches (the
"Written Notice").  The License will terminate (A) 30 days after the
receipt of the Written Notice (i) if material breaches capable of being
corrected within such 30 days have not been corrected, or (ii) for material
breaches not capable of being corrected within 30 days of receipt of the
Written Notice, if correction of such breach is not commenced within such
30 days and prosecuted reasonably diligently thereafter, and (B)
immediately upon receipt of the Written Notice in the case of material
breaches incapable of being corrected.

     11.3 EFFECT OF TERMINATION.  Upon termination of the License,
Amerimmune shall transfer to Inventor all rights which Amerimmune may have,
if any, to the Technology and the Marks, and all rights to any sublicenses
which may have been granted pursuant to the terms hereof.

12.  NOTICE

     Any notice or other communication hereunder must be given in writing
and either (i) delivered in person, (ii) transmitted by telex, facsimile or
telecopy mechanism provided that any notice so given is also mailed as
provided herein, (iii) delivered by Federal Express or similar commercial
delivery service or (iv) mailed by certified mail, postage prepaid, return
receipt requested, to the party to which such notice or communication is to
be given at the address set forth on the signature page of this Agreement
or to such other address or to such other person as either party shall have
last designated by such notice to the other party.  Each such notice or
other communication shall be effective (i) if given by telex, facsimile or
telecopy mechanism, when transmitted, (ii) if given by mail, two (2) days
after such communication is deposited in the mails and addressed as
aforesaid, (iii) if given by Federal Express or similar commercial delivery
service, one (1) business day after such communication is deposited with
such service and addressed as aforesaid, and (iv) if given by any other
means, when actually delivered at such address.

                                    9
<PAGE>
13.  DISPUTE RESOLUTION BY REFEREE

     Amerimmune and Inventor agree to waive the right to a jury trial and
to submit any disagreement or controversy arising under or relating to this
Agreement or the subject matter hereof for resolution by a trial on Order
of Reference.  Such trial shall be conducted by a retired judge or justice
having expertise in commercial disputes and who is acceptable to both
parties.  The retired judge or justice shall be appointed pursuant to the
provisions of California Code of Civil Procedure Section 638(1) or any
amendment, addition or successor section thereto.  If the parties are unable
to agree upon a retired judge or justice panel to act as referee, then upon
petition by either party to the presiding judge of the Superior Court of the
State of California for the County of Los Angeles, Central District (or such
other judge as the presiding judge may designate for such purpose), such
judge shall in his or her sole discretion select one retired judge or
justice who shall serve as the referee.  Such referee shall hear the
dispute or controversy until the final determination thereof pursuant to
Article VI, Section 21 of the California Constitution, Section 638 ET SEQ.
of the California Code of Civil Procedure, and Rule 244.1(a) of the
California Rules of Court.  The referee shall conduct such reference
proceeding, including making orders relating to discovery to take place in
connection therewith, so that the period of time from such referee's
appointment until the reference proceeding is concluded is not longer than
six (6) months (such period is directory only, and a failure to conclude
such proceeding within such period shall not result in a loss of
jurisdiction by the referee).  The referee's award shall be in writing, and
shall include a statement of decision, in accordance with Section 632 of
the California Code of Civil Procedure.  The parties shall pay in advance,
to the referee, the estimated reasonable fees and costs of the reference as
may be specified in advance by the referee.  The parties shall share
equally, by paying their proportionate amount, the fees and costs of the
reference.  The parties intend this general reference agreement to be
specifically enforceable.

14.  GOVERNING LAW

     This Agreement and the legal relations between the parties shall be
governed by and construed in accordance with the laws of the State of
California, except where such are governed exclusively by federal law.

15.  RELATIONSHIP OF PARTIES

     Each party shall conduct all business in its own name as an
independent contractor.  No joint venture, partnership, employment, agency
or similar arrangement is created between the parties.  Neither party has
the right or power to act for or on behalf of the other or to bind the
other in any respect, to pledge its credit, to accept any service of
process upon it, or to receive any notices of any nature whatsoever on its
behalf.

                                   10
<PAGE>
16.  SEVERABILITY

     If any provision of this Agreement is determined to be illegal,
invalid or otherwise unenforceable by a court of competent jurisdiction
then, to that extent and within the jurisdiction in which it is illegal,
invalid or unenforceable, it shall be limited, construed or severed and
deleted from this Agreement, and the remaining extent and/or remaining
portions hereof shall survive, remain in full force and effect and continue
to be binding and shall not be affected except insofar as may be necessary
to make sense hereof, and shall be interpreted to give effect to the
intention of the parties insofar as that is possible.

17.  BREACH; REMEDIES

     In the event of a breach of this Agreement, the non-breaching party
shall be entitled to exercise any right or remedy available to it
hereunder, at law or in equity, including without limitation specific
enforcement of the terms hereof.  The exercise of any right or remedy
available to a party shall not preclude the concurrent or subsequent
exercise by it of any other right or remedy and all rights and remedies
shall be cumulative.

18.  ENTIRE AGREEMENT

     This Agreement (including Exhibits A-G attached hereto which are
herein incorporated by this reference) contains the entire agreement
between the parties with respect to the subject matter hereof and
supersedes all previous negotiations, agreements, arrangements and
understandings with respect to the subject matter hereof.

19.  INTERPRETATION

     The normal rule of construction that an agreement shall be interpreted
against the drafting party shall not apply.  In this Agreement, whenever
the context so requires, the masculine, feminine or neuter gender, and the
singular or plural number or tense, shall include the others.

20.  AMENDMENT AND WAIVER

     Neither this Agreement nor any of its provisions may be amended,
changed, modified or waived except in a writing duly executed by an
authorized officer of the party to be bound thereby.

21.  SUCCESSORS AND ASSIGNS

     This Agreement shall be binding upon and shall inure to the benefit of
the parties and their respective legal representatives, successors and assigns.

                                   11
<PAGE>
22.  COUNTERPARTS.

     This Agreement may be executed in one or more counterparts, each of
which shall be deemed to be an original, and such counterparts together
shall constitute one agreement.

     IN WITNESS WHEREOF, the undersigned have hereunto set their hands as
of the day and year first above written.

                                        Amerimmune, Inc.
___________________________________     21550 Oxnard Street, Suite 830
Allen D. Allen                          Woodland Hills, California 91367
4236 Longridge Avenue #302              Facsimile: (310) 768-2026
Studio City, California 91604
Facsimile:_________________________
                                        By:_____________________________
                                        Name:___________________________
CytoDyn of New Mexico, Inc.             Title:__________________________
____________________________________
____________________________________
Facsimile:__________________________    Consent of spouse of Allen D. Allen
                                        ---------------------------------
                                        The undersigned, who is the wife of
                                        Allen D. Allen, consents to the
By:_________________________________    terms of the foregoing Agreement.
Name:_______________________________
Title:______________________________
                                        _________________________________

<PAGE>
                                EXHIBIT A

                               TECHNOLOGY

"Technology" shall mean the Patents, Patent Rights, Know-how, Products and
Trade Secrets, as such terms are hereafter defined, existing upon
commencement of the Term (as such term is defined in the Agreement),
together with any improvements to any of the foregoing invented, created,
developed or acquired by Inventor during the Term.

The "Patents" shall mean all right, title and interest in the inventions,
processes and improvements described and claimed in United States Patent
No. 5,424,066 entitled METHOD FOR INCREASING CD4+ CELL NUMBERS THROUGH THE
USE OF MONOCLONAL ANTIBODIES DIRECTED AGAINST SELF-REACTIVE, CD4 SPECIFIC
CYTOTOXIC T-CELLS issued June 13, 1995 and United States Patent No.
5,651,970 entitled METHOD FOR INHIBITING DISEASE ASSOCIATED WITH THE HUMAN
IMMUNODEFICIENCY VIRUS THROUGH THE USE OF MONOCLONAL ANTIBODIES DIRECTED
AGAINST ANTI-SELF CYTOTOXIC T-LYMPHOCYTES OR THEIR LYTICS, issued July 29,
1997.

The "Patent Rights" shall mean foreign patent applications corresponding to
the Patents, together with any U.S. or foreign continuations, divisional or
continuation-in-part applications and all other applications relating in
any way to the subject matter described in the Patents and any letters
patent related thereto as well as any reissue and/or re-examined patents
issuing thereon, and shall include without limitation pending U.S. patent
application nos. 08/940,227 (METHOD FOR TREATING DISEASE INCLUDING
MOLLUSCUM CONTAGIOSUM ASSOCIATED WITH THE HUMAN IMMUNODEFICIENCY VIRUS
THROUGH THE USE OF MONOCLONAL ANTIBODIES) and 08/940,228 (TREATMENT OF HIV
INFECTION (sic) BY INFUSING A DOSE OF SELECTED MONOCLONAL ANTIBODIES THAT
INHIBIT PRODUCTION OF LYMPHOCYTE- ASSOCIATED MOLECULE (sic) 1 (LFA-1) ON
CD8 CELLS).

"Know-How" shall mean all know-how, intellectual property, technical
expertise, inventions, information, improvements, computer programs,
algorithms, data, discoveries, ideas, and concepts, whether or not
patentable or copyrightable, including but not limited to medical,
clinical, chemical, pharmaceutical, pharmacological, topological,
toxicological or other scientific data (including without limitation
preclinical and clinical data, notes, reports, models and samples), unique
methods, processes, techniques, designs, formulae, configurations of any
kind, computer graphics, apparatus, products, devices, software,
specifications, drawings and all testing, assaying and analysis
methodologies in any manner pertaining or relating to, resulting from or
useful in connection with the Patents or Patent Rights.

"Products" shall mean all products that embody or make use of all or any
part of the Patents or Patent Rights or Know-how.

"Trade Secrets" shall mean all documents and information in any form that
have been originated by, are peculiarly within the knowledge of or are
proprietary to Inventor in whole or in part, and are

<PAGE>
subject to protection under recognized legal principles as trade secrets or
otherwise pertaining or relating to, resulting from or useful in connection
with the design, manufacture, installation, sales, marketing,
administration, use, repair or operation of products, processes or services
pertaining or relating to, resulting from or useful in connection with the
Patents or Patent Rights or Know-how or Products.

<PAGE>
                                EXHIBIT B

                             LOAN AGREEMENT

     See attached form of Amendment to Loan Documents.

<PAGE>
                                EXHIBIT C

                          3R LICENSE AGREEMENT

     See attached form of 3R License Agreement

<PAGE>
                                EXHIBIT D

                   ADDITIONAL COVENANTS OF AMERIMMUNE

1.  As promptly as reasonably possible following satisfaction of the
License Condition, Amerimmune shall: (i) pay to Inventor any payments owed
to Inventor by Amerimmune under the terms of any Agreements existing as of
the Effective Date between (A) Amerimmune and Inventor or (B) Amerimmune
and 3R, that have been refused by Inventor, but in no event shall the
foregoing be interpreted to require Amerimmune to make any double payment
of any amount owed by Amerimmune; and (ii) use commercially reasonable
efforts (which shall include, without limitation, filing either an
arbitration or a lawsuit to the extent that a claim can be made in good
faith) to cancel the shares of stock of Amerimmune and/or API owned by 3R,
its shareholders, principals, officers, directors or affiliates.

2.  If Inventor acquires shares of stock of Amerimmune and/or API from 3R
or its shareholders, principals, officers, directors or affiliates, and
delivers such shares to Amerimmune pursuant to Section 4 of the Agreement,
Amerimmune shall pay to Inventor the amount of the incremental cost and
expense incurred in acquiring such shares from 3R promptly after Inventor
delivers to Amerimmune evidence reasonably satisfactory to Amerimmune of
the amount of Inventor's incremental cost and expense.  If, in an action or
arbitration brought by Inventor to satisfy the License Condition, shares of
stock of API owned by Inventor are ordered to be and are canceled, then, as
additional consideration for the License, API shall issue to Inventor a
number of shares of the same class of stock of API equal to the number of
shares so canceled.

3.  If the License Condition is satisfied, Amerimmune agrees not to file an
action or arbitration against Inventor seeking return or cancellation of
the shares of stock of Amerimmune and/or API owned by Inventor as of the
Effective Date based on a claim of failure or lack of consideration for
such shares.

4.  If the License Condition is satisfied, Amerimmune agrees not to employ
or enter into any consulting contract with 3R and/or any persons or
entities who as of the Effective Date are shareholders, principals,
officers, directors or affiliates of 3R.

<PAGE>
                                EXHIBIT E

                     EXCEPTIONS TO SECTION 8.2(viii)

Known to us as of February 13, 2000:

Abbott Laboratories of Abbott Park, Ill., a major pharmaceutical company,
has registered the Internet domain name CYTOLIN.COM, according to
information we received from Dr. Strickland the evening of 2/13/00.  It is
not clear why they did so since our trademark would presumably preclude
them from using that trade name on a product.  It is not clear whether this
registration would be an infringement as opposed to an unfair business
practice since the Marks are protected as a description of products.  Of
course, if they don't use the domain name actively, then there is no damage
being as how we have both agreed not to use it.

A company in Florida incorporated under the name Cytodyne Technologies and
has been advertising a nutraceutical weight loss product.  This has caused
confusion in that doctors have asked us if we have entered that field.  Mr.
McCann sent a cease and desist letter on behalf of Amerimmune with no
apparent effect.  Mr. Judson had gone so far as to prepare a complaint but
that was sabotaged by Roy Azarnoff.

<PAGE>
                                EXHIBIT F

1.   SPECIAL QUALIFICATIONS FOR A PATENT ATTORNEY USED TO PROSECUTE OR
     DEFEND ALLEN'S PATENTS.

     (a)  Should have successfully prosecuted at least one patent on a
treatment method, preferably more.

     (b)  Should have successfully prosecuted at least one patent,
preferably more, where novelty is a challenge due to the fact that the
invention arises from a better understanding of information in the prior
art and not from new information.

     (c)  After conferring with Mr. Allen should understand the distinction
between an infection, an infectious disease in the sense of Koch, and a
noninfectious disease with an infectious agent, as may be necessary to
argue for novelty.

     (d)  After conferring with Mr. Allen should understand how the laws of
nature can be used predictively by scientists, as may be necessary to argue
for utility.

     (e)  Should be able and willing to advise Amerimmune of how public or
discoverable statements made by Amerimmune, or unchallenged public
statements made by others, that incorrectly characterize the Technology
could lay a foundation for a challenge to any patent licensed under this
Agreement, including but without limitation, by estoppel.

2.   SPECIAL QUALIFICATIONS FOR A PATENT ATTORNEY USED TO ENFORCE AND
     PREVENT INFRINGEMENTS AGAINST ALLEN'S PATENTS.

     Should have extensive knowledge of the statutory and case law on
contributory infringement, the staple exception, and the reasons why a
pharmaceutical product cannot be a staple.

3.   ACKNOWLEDGMENT.

     Inventor acknowledges and agrees that Rod S. Berman, Esq. and David J.
Meyer, Esq., of Jeffer Mangels Butler & Marmaro LLP satisfy all of the
qualifications set forth in this Exhibit F.

<PAGE>
                                EXHIBIT G

                     PRIOR CONFIDENTIAL INFORMATION

     The term "Prior Confidential Information" refers to all data, reports,
drawings, tapes, formulae, interpretations, records, trade secrets,
documents, information regarding products, processes, research and
development, apparatus and application methods that are not and have not
been openly communicated or made accessible by Amerimmune or 3R to third
parties and that Inventor obtains or obtained from Amerimmune, 3R, their
employees, subsidiaries and affiliates, or that Inventor otherwise acquired
from Amerimmune or 3R, including information of a third party as to which
Amerimmune has a nondisclosure obligation, and including all Consultant
Innovations (as defined below).  Additionally, Prior Confidential
Information shall include any and all reports to 3R made by Allen in the
course of performance of that certain Consulting Agreement dated August 1,
1998 between Allen and 3R (the "3R Consulting Agreement"), and the contents
thereof and any and all information developed, created, transcribed or
generated in any form in performance thereof.

     "Consultant Innovations" includes, but is not limited to, all
intellectual property, technical innovations, inventions, discoveries,
ideas, concepts, know-how, technical expertise, formulae, information,
data, unique methods, improvements, new and useful art, computer programs,
processes of which any computer program constitutes a part, configuration
of any kind, algorithm, processes, techniques, designs, devices, software,
specifications and medical, clinical, chemical, pharmaceutical,
pharmacological, topological, toxicological or other scientific data
(including without limitation preclinical and clinical data, notes,
reports, models and samples), in any manner pertinent or related to,
resulting from or useful in or to the Technology and all products that
embody or make use of all or any part of the Technology that were or are
conceived (whether or not reduced to practice) or first reduced to practice
by Inventor whether solely or jointly with others, during the term of the
3R Consulting Agreement or as a result of knowledge acquired while
performing services thereunder, whether patentable or copyrightable or not.
Notwithstanding the foregoing, Consultant Innovations shall not include
inventions, any intellectual property, technical innovations, discoveries,
ideas, concepts, know-how, technical expertise, formulae, information,
data, unique methods, improvements, new and useful art, computer programs,
processes of which any computer program constitutes a part, configuration
of any kind, algorithm, processes, techniques, designs, devices, software,
specifications or other scientific data in the field of biotechnology that
are in no manner pertinent or related to, or resulting from or useful in
the Technology or medical or pharmaceutical purposes and, without
limitation, shall not include anything whatsoever related to the fields of
physics or music.

     Inventor:

*    shall hold the Prior Confidential Information in confidence;

*    shall take or cause to be taken all reasonable precautions to prevent
     the disclosure or communication of Prior Confidential Information to
     third parties;

<PAGE>
*    agrees that each reproduction, duplication, or copy of any portion of
     Prior Confidential Information shall be deemed Prior Confidential
     Information for all purposes hereunder.

     Amerimmune agrees Inventor may publish papers in peer review,
scientific and technical journals; provided that Inventor agrees (i) no
such paper will include Prior Confidential Information, (ii) Inventor will
deliver a final copy of the proposed paper to Amerimmune for its approval
no less than 30 days prior to the date he plans to deliver the paper to the
journal publisher, (iii) if Amerimmune advises Inventor that in its
reasonable judgment the paper contains, or could lead to the discovery of,
Prior Confidential Information, Inventor will delete such Confidential
Information or the means of discovering such Information, (iv) if Inventor
or the journal publisher propose to make any change to the paper previously
submitted to Amerimmune, such proposed change will be submitted to
Amerimmune for its approval before it is made and not less than 5 business
days prior to the paper being released to the printer for final printing,
and (v) Inventor will only permit a paper approved by Amerimmune to be
published.  Amerimmune agrees that should it publish any articles
describing the contributions of Allen under this Agreement, it will
acknowledge Allen's contribution to such results.

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