Document:

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                                                                   Exhibit 10.63

                              SEVERANCE AGREEMENT

     THIS SEVERANCE AGREEMENT ("Agreement") is entered into as of the 15th day
of April 2005, by and between United American of Tennessee, Inc. ("Employer")
and Osbie L. Howard ("Employee").

                                   RECITALS:
                                   --------

     A.   Employee previously was employed by Employer.

     B.   Said employment terminated effective April 15, 2005 (the "Termination
Date").

     C.   Employee and Employer wish to memorialize herein all of their
respective rights and duties relating to said employment and the termination
thereof.

                                   AGREEMENT:
                                   ---------

     1.   Employee's employment by Employer shall be deemed terminated
effective on the Termination Date.

     2.   Upon receipt by Employer of a copy of this Agreement signed by
Employee, Employer shall continue to pay Employee bi-weekly consistent with
Employer's payroll policies, payments equal to Employee's rate of salary in
existence immediately preceding his termination of employment, for a period of
sixteen (16) consecutive weeks after the Termination Date. Said weekly payments
shall be subject to deductions for applicable taxes and as otherwise required by
law and/or authorized by Employee. Additionally, Employer shall continue on
behalf of Employee for said sixteen (16) week period Employee's current group
health benefit coverage. Thereafter Employer shall either pay on behalf of
Employee, or reimburse Employee for, any premium applicable to the continuation
of Employee's health benefits coverage under COBRA, for the balance of one (1)
year after the Termination Date.

     Said consideration shall be contingent upon Employee not revoking this
Agreement as provided below and Employee agrees that he is not otherwise
entitled to receive this consideration.

     3.   In return for the consideration set forth above, Employee hereby
unconditionally releases and forever discharges Employer, as well as each of its
parent(s), subsidiary(ies), division(s), component(s), affiliate(s),
successor(s), related entities, and assign(s) (including by example and not
limitation, OmniCare Health Plan, Inc. and United American Health Care
Corporation), as well as each's officer(s), director(s), employee(s), agent(s)
and attorney(s) (collectively "Releasees") from ANY AND ALL causes of action,
suits, damages, claims and demands whatsoever which Employee ever had or now has
against any of Releasees, directly or indirectly, by reason of any facts
existing as of this date, whether known or unknown, including, but not limited
to, claims for defamation, wrongful discharge, breach of contract, negligence
and other tort actions, and/or discrimination, harassment and/or retaliation on
account of age, sex, sexual orientation, race, color, religion, marital status,
disability, height, weight, national origin, or any other classification
recognized under the common law of the State of Tennessee, the State
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of Michigan local law and/or ordinances, and the civil rights statutes,
including, but not limited to: Title VII of the Civil Rights Act of 1964; the
Age Discrimination Act of 1967; The Age Discrimination in Employment Act, and/or
the Rehabilitation Act of 1973; the Fair Labor Standards Act; the Older Workers
Benefit Protection Act; the Americans With Disabilities Act; the Family and
Medical Leave Act of 1993; the Worker Adjustment and Retraining Notification
Act; the Tennessee Fair Employment Practices Law; the Tennessee Human Rights
Act; the Elliott-Larsen Civil Rights Act; the Michigan Persons With Disabilities
Civil Rights Act; the Michigan Whistleblowers Protection Act, and any and all
amendments to any of the same. Employee understands and agrees that this is a
total and complete release by Employee of all claims which Employee has against
any of Releasees, both known and unknown, even though there may be facts and
consequences of facts which are unknown to Employee and/or Releasees. Employee
further agrees that he has suffered no work related injury or illness, and that
he has been properly paid all his past wages and benefits, including vacation
pay, as of this date.

     4.   Employee agrees that, in the event he brings suit or makes any claim
or charge in any manner in violation of this Agreement, he shall be liable to
the affected Releasee(s) for any damage caused thereby, including but not
limited to any affected Releasee's complete cost of defense, including
attorneys' fees.

     5.   By entering into this Agreement, Employer admits no wrongdoing in any
respect in its treatment of Employee.

     6.   Employee agrees he will not disclose the existence or any of the
terms of this Agreement to any other person except his counsel and immediate
family, tax advisor, any prospective employer or any new employer. As a
precondition to any permitted disclosure, Employee shall instruct the party
to whom the disclosure is made, to maintain as strictly confidential all said
information disclosed. Employee further agrees he will not disclose to any
other person, or himself use any trade secret or Confidential Information (as
defined below) of any of Releasees.

     7.   Employee shall not at any time, on or after the date of this
Agreement, disseminate, disclose, use, communicate or otherwise appropriate,
either directly or indirectly, through any individual, person or entity, any
Confidential Information and Employee shall retain all such information in
trust in a fiduciary capacity for the sole use and benefit of any of Releasees.
Employee acknowledges that the Confidential Information is valuable, special,
proprietary and unique to Releasees, that Releasees' business depends on such
Confidential Information, and that Releasees wish to protect such Confidential
Information by keeping it secret and for the sole use and benefit of Releasees.
Employee shall take all steps necessary and all steps reasonably requested by
any of Releasees to ensure that all such Confidential Information is kept
secret and confidential for the sole use and benefit of any of Releasees. All
records and other materials pertaining to the Confidential Information, whether
or not developed by Employee, shall be and remain the exclusive property of any
of Releasees. Employee has delivered to any of Releasees all materials
concerning any Confidential Information and all copies of such materials and
any other materials of any of Releasees which are in Employee's possession or
under Employee's control, and Employee shall not make or retain any copies or
extracts of such materials.

                                       2
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     For purposes of this Agreement, Confidential Information means and
includes all information known or used by any of Releasees in any of Releasee's
business and/or developed by or for any of Releasees by any person, including
Employee, which is not otherwise explicitly, consciously, properly, legally and
generally known in any industry in which any of Releasees is engaged.
Confidential Information does not include general skills and general knowledge
of any industry obtained by reason of Employee's association with any of
Releasees.

     Confidential Information specifically includes, but is not limited to,
information of any Releasee concerning marketing, sales, processes, procedures,
rates, suppliers, vendors, contractors representatives, computer systems,
computer programs, plans for the development of new products, services and/or
expansion into new areas or markets, internal operations and any variations,
purchasing policies, bidding practices or procedures, pricing policies,
customer identities, trade secrets or proprietary or confidential information
of any type, together with all written, graphic, electronic and other materials
relating to all or any part of the same.

     8.   Employee shall not cooperate voluntarily with any person or entity
with respect to any judicial, administrative or other claim and/or action
planned or brought against any of the Releases. Employee shall immediately
notify counsel for the applicable Releasee(s) in the event Employee receives
any subpoena, court order or request to provide testimony, documents and/or any
other form of information in connection with any such claim or action. Employee
shall assist and cooperate fully with counsel for any of the Releasees in
connection with the defense or prosecution of any claim and/or action by or
against any of the Releasees. Employee shall be reimbursed for any reasonable
and necessary expenses incurred by Employee in connection with rendering any
said assistance and/or cooperation.

     9.   Employee also acknowledges and understands that:

          (a)  He has been encouraged to consult an attorney prior to signing
this Agreement.

          (b)  He has been given twenty-one (21) days to consider and sign this
Agreement; and

          (c)  He may revoke this Agreement within seven (7) days of signing
it (the "Revocation Period"), provided that he does so in writing and sends
notice of his revocation to Employer and counsel for Employer via facsimile
transmission on or before the expiration of the Revocation Period.

          (d)  This Agreement will not become enforceable until the Revocation
Period has expired.

     10.  This Agreement is freely and voluntarily entered into by Employee
without any duress or coercion and after Employee has had an opportunity to
consult with counsel and has carefully and completely read all of the terms and
provisions of this Agreement.

     11.  This Agreement constitutes the entire agreement between the parties
on the subjects hereof, supersedes any prior agreements between the parties and
cannot be amended except in writing executed by both parties.

                                       3
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     THIS IS AN AGREEMENT FOR RELEASE AND WAIVER OF CLAIMS INCLUDING BUT NOT
LIMITED TO ANY CLAIMS PRESENTLY EXISTING UNDER THE AGE DISCRIMINATION IN
EMPLOYMENT ACT.

WITNESSES:                          United American of Tennessee, Inc.

/s/ Carolyn Onumonu                 By: /s/ William C. Brooks
--------------------------              --------------------------
Carolyn Onumonu                         William C. Brooks
Executive Assistant                     Its Chairman
--------------------------              --------------------------

                                    Employee

/s/ Stephen Harris                  By: /s/ Osbie L. Howard
--------------------------              --------------------------
Stephen Harris                          Osbie L. Howard

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

                                       4<PAGE>

                                                                    EXHIBIT 10.1

                          LEXICON GENETICS INCORPORATED
                 2000 NON-EMPLOYEE DIRECTORS' STOCK OPTION PLAN

                    (RESTATED TO REFLECT SPLIT PRIOR TO IPO)

1        PURPOSES.

         (a) ELIGIBLE OPTION RECIPIENTS. The persons eligible to receive Options
are the Non-Employee Directors of the Company.

         (b) AVAILABLE OPTIONS. The purpose of the Plan is to provide a means by
which Non-Employee Directors may be given an opportunity to benefit from
increases in value of the Common Stock through the granting of Nonstatutory
Stock Options.

         (c) GENERAL PURPOSE. The Company, by means of the Plan, seeks to retain
the services of its Non-Employee Directors, to secure and retain the services of
new Non-Employee Directors and to provide incentives for such persons to exert
maximum efforts for the success of the Company and its Affiliates.

2        DEFINITIONS.

         (a) "AFFILIATE" means any parent corporation or subsidiary corporation
of the Company, whether now or hereafter existing, as those terms are defined in
Sections 424(e) and (f), respectively, of the Code.

         (b) "ANNUAL GRANT" means an Option granted annually to all Non-Employee
Directors who meet the specified criteria pursuant to subsection 6(b) of the
Plan.

         (c) "ANNUAL MEETING" means the annual meeting of the stockholders of
the Company.

         (d) "BOARD" means the Board of Directors of the Company.

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

         (f) "COMMON STOCK" means the common stock, par value $.001 per share,
of the Company.

         (g) "COMPANY" means Lexicon Genetics Incorporated, a Delaware
corporation.

         (h) "CONSULTANT" means any person, including an advisor, (i) engaged by
the Company or an Affiliate to render consulting or advisory services and who is
compensated for such services or (ii) who is a member of the Board of Directors
of an Affiliate. However, the term "Consultant" shall not include either
Directors of the Company who are not compensated by the Company for their
services as Directors or Directors of the Company who are merely paid a
director's fee by the Company for their services as Directors.

         (i) "CONTINUOUS SERVICE" means that the Optionholder's service with the
Company or an Affiliate, whether as an Employee, Director or Consultant, is not
interrupted or terminated. The Optionholder's Continuous Service shall not be
deemed to have terminated merely because of a change in

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the capacity in which the Optionholder renders service to the Company or an
Affiliate as an Employee, Consultant or Director or a change in the entity for
which the Optionholder renders such service, provided that there is no
interruption or termination of the Optionholder's Continuous Service. For
example, a change in status from a Non-Employee Director of the Company to a
Consultant of an Affiliate or an Employee of the Company will not constitute an
interruption of Continuous Service. The Board or the chief executive officer of
the Company, in that party's sole discretion, may determine whether Continuous
Service shall be considered interrupted in the case of any leave of absence
approved by that party, including sick leave, military leave or any other
personal leave.

         (j) "DIRECTOR" means a member of the Board of Directors of the Company.

         (k) "DISABILITY" means the permanent and total disability of a person
within the meaning of Section 22(e)(3) of the Code.

         (l) "EMPLOYEE" means any person employed by the Company or an
Affiliate. Mere service as a Director or payment of a director's fee by the
Company or an Affiliate shall not be sufficient to constitute "employment" by
the Company or an Affiliate.

         (m) "EXCHANGE ACT" means the Securities Exchange Act of 1934, as
amended.

         (n) "FAIR MARKET VALUE" means, as of any date, the value of the Common
Stock determined as follows:

                  (i) If the Common Stock is listed on any established stock
         exchange or traded on the Nasdaq National Market or the Nasdaq SmallCap
         Market, the Fair Market Value of a share of Common Stock shall be the
         closing sales price for such stock (or the closing bid, if no sales
         were reported) as quoted on such exchange or market (or the exchange or
         market with the greatest volume of trading in the Common Stock) on the
         last market trading day prior to the day of determination, as reported
         in The Wall Street Journal or such other source as the Board deems
         reliable.

                  (ii) In the absence of such markets for the Common Stock, the
         Fair Market Value shall be determined in good faith by the Board.

         (o) "INITIAL GRANT" means an Option granted to a Non-Employee Director
who meets the specified criteria pursuant to subsection 6(a) of the Plan.

         (p) "IPO DATE" means the effective date of the initial public offering
of the Common Stock.

         (q) "NON-EMPLOYEE DIRECTOR" means a Director who is not an Employee.

         (r) "NONSTATUTORY STOCK OPTION" means an Option not intended to qualify
as an incentive stock option within the meaning of Section 422 of the Code and
the regulations promulgated thereunder.

         (s) "OFFICER" means a person who is an officer of the Company within
the meaning of Section 16 of the Exchange Act and the rules and regulations
promulgated thereunder.

         (t) "OPTION" means a Nonstatutory Stock Option granted pursuant to the
Plan.

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         (u) "OPTION AGREEMENT" means a written agreement between the Company
and an Optionholder evidencing the terms and conditions of an individual Option
grant. Each Option Agreement shall be subject to the terms and conditions of the
Plan.

         (v) "OPTIONHOLDER" means a person to whom an Option is granted pursuant
to the Plan or, if applicable, such other person who holds an outstanding
Option.

         (w) "PLAN" means this Lexicon Genetics Incorporated 2000 Non-Employee
Directors' Stock Option Plan.

         (x) "RULE 16B-3" means Rule 16b-3 promulgated under the Exchange Act or
any successor to Rule 16b 3, as in effect from time to time.

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

3        ADMINISTRATION.

         (a) ADMINISTRATION BY BOARD. The Board shall administer the Plan. The
Board may not delegate administration of the Plan to a committee.

         (b) POWERS OF BOARD. The Board shall have the power, subject to, and
within the limitations of, the express provisions of the Plan:

                  (i) To determine the provisions of each Option to the extent
         not specified in the Plan.

                  (ii) To construe and interpret the Plan and Options granted
         under it, and to establish, amend and revoke rules and regulations for
         its administration. The Board, in the exercise of this power, may
         correct any defect, omission or inconsistency in the Plan or in any
         Option Agreement, in a manner and to the extent it shall deem necessary
         or expedient to make the Plan fully effective.

                  (iii) To amend the Plan or an Option as provided in Section
         12.

                  (iv) Generally, to exercise such powers and to perform such
         acts as the Board deems necessary or expedient to promote the best
         interests of the Company that are not in conflict with the provisions
         of the Plan.

         (c) EFFECT OF BOARD'S DECISION. All determinations, interpretations and
constructions made by the Board in good faith shall not be subject to review by
any person and shall be final, binding and conclusive on all persons.

4        SHARES SUBJECT TO THE PLAN.

         (a) SHARE RESERVE. Subject to the provisions of Section 11 relating to
adjustments upon changes in the Common Stock, the Common Stock that may be
issued pursuant to Options shall not exceed in the aggregate Six Hundred
Thousand (600,000) shares of Common Stock.

         (b) EVERGREEN SHARE RESERVE INCREASE.

                  (i) Notwithstanding subsection 4(a) hereof, on the day after
         each Annual Meeting (the "Calculation Date") for a period of ten (10)
         years, commencing with the Annual Meeting in

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         2000, the aggregate number of shares of Common Stock that is available
         for issuance under the Plan shall automatically be increased by that
         number of shares equal to the greater of (1) three-tenths of one
         percent (0.3%) of the Diluted Shares Outstanding or (2) the number of
         shares of Common Stock subject to Options granted during the prior
         12-month period; provided, however, that the Board, from time to time,
         may provide for a lesser increase in the aggregate number of shares of
         Common Stock that is available for issuance under the Plan.

                  (ii) "Diluted Shares Outstanding" shall mean, as of any date,
         (1) the number of outstanding shares of Common Stock of the Company on
         such Calculation Date, plus (2) the number of shares of Common Stock
         issuable upon such Calculation Date assuming the conversion of all
         outstanding Preferred Stock and convertible notes, plus (3) the
         additional number of dilutive Common Stock equivalent shares
         outstanding as the result of any options or warrants outstanding during
         the fiscal year, calculated using the treasury stock method.

         (c) REVERSION OF SHARES TO THE SHARE RESERVE. If any Option shall for
any reason expire or otherwise terminate, in whole or in part, without having
been exercised in full, the shares of Common Stock not acquired under such
Option shall revert to and again become available for issuance under the Plan.

         (d) SOURCE OF SHARES. The shares of Common Stock subject to the Plan
may be unissued shares or reacquired shares, bought on the market or otherwise.

5        ELIGIBILITY.

         The Options as set forth in section 6 automatically shall be granted
under the Plan to all Non-Employee Directors.

6        NON-DISCRETIONARY GRANTS.

         (a) INITIAL GRANTS. Without any further action of the Board, each
person who is elected or appointed for the first time to be a Non-Employee
Director automatically shall, upon the date of his or her initial election or
appointment to be a Non-Employee Director, be granted an Initial Grant to
purchase Thirty Thousand (30,000) shares of Common Stock on the terms and
conditions set forth herein.

         (b) ANNUAL GRANTS. Without any further action of the Board, on the day
following each Annual Meeting, commencing with the Annual Meeting in 2001, each
person who is then a Non-Employee Director, and has been a Non-Employee Director
for at least six (6) months, automatically shall be granted an Annual Grant to
purchase Ten Thousand (10,000) shares of Common Stock on the terms and
conditions set forth herein.

7        OPTION PROVISIONS.

         Each Option shall be in such form and shall contain such terms and
conditions as required by the Plan. Each Option shall contain such additional
terms and conditions, not inconsistent with the Plan, as the Board shall deem
appropriate. Each Option shall include (through incorporation of provisions
hereof by reference in the Option or otherwise) the substance of each of the
following provisions:

         (a) TERM. No Option shall be exercisable after the expiration of ten
(10) years from the date it was granted.

<PAGE>

         (b) EXERCISE PRICE. The exercise price of each Option shall be one
hundred percent (100%) of the Fair Market Value of the stock subject to the
Option on the date the Option is granted.

         (c) CONSIDERATION. The purchase price of stock acquired pursuant to an
Option may be paid, to the extent permitted by applicable statutes and
regulations, in any combination of (i) cash or check, or (ii) delivery to the
Company of other Common Stock. The purchase price of Common Stock acquired
pursuant to an Option that is paid by delivery to the Company of other Common
Stock acquired, directly or indirectly from the Company, shall be paid only by
shares of the Common Stock of the Company that have been held for more than six
(6) months (or such longer or shorter period of time required to avoid a charge
to earnings for financial accounting purposes). At any time that the Company is
incorporated in Delaware, payment of the Common Stock's "par value," as defined
in the Delaware General Corporation Law, shall not be made by deferred payment.

         (d) TRANSFERABILITY. An Option is not transferable, except (i) by will
or by the laws of descent and distribution, (ii) by instrument to an inter vivos
or testamentary trust, in a form accepted by the Company, in which the Option is
to be passed to beneficiaries upon the death of the trustor (settlor) and (iii)
by gift, in a form accepted by the Company, to a member of the "immediate
family" of the Optionholder as that term is defined in 17 C.F.R. 240.16a-1(e).
In addition, Optionholder may, by delivering written notice to the Company, in a
form satisfactory to the Company, designate a third party who, in the event of
the death of the Optionholder, shall thereafter be entitled to exercise the
Option.

         (e) VESTING. Options shall vest as follows:

                  (i) Initial Grants shall provide for vesting of 1/60th of the
         shares subject to the Option each month after grant for five (5) years
         after the date of the grant.

                  (ii) Annual Grants shall provide for vesting of 1/12th of the
         shares subject to the Option each month after grant for twelve (12)
         months after the date of the grant.

         (f) TERMINATION OF CONTINUOUS SERVICE. In the event an Optionholder's
Continuous Service terminates (other than upon the Optionholder's death or
Disability), the Optionholder may exercise his or her Option (to the extent that
the Optionholder was entitled to exercise it as of the date of termination) but
only within such period of time ending on the earlier of (i) the date six (6)
months following the termination of the Optionholder's Continuous Service, or
(ii) the expiration of the term of the Option as set forth in the Option
Agreement. If, after termination, the Optionholder does not exercise his or her
Option within the time specified in the Option Agreement, the Option shall
terminate.

         (g) EXTENSION OF TERMINATION DATE. If the exercise of the Option
following the termination of the Optionholder's Continuous Service (other than
upon the Optionholder's death or Disability) would be prohibited at any time
solely because the issuance of shares would violate the registration
requirements under the Securities Act, then the Option shall terminate on the
earlier of (i) the expiration of the term of the Option set forth in subsection
7(a) or (ii) the expiration of a period of three (3) months after the
termination of the Optionholder's Continuous Service during which the exercise
of the Option would not be in violation of such registration requirements.

         (h) DISABILITY OF OPTIONHOLDER. In the event an Optionholder's
Continuous Service terminates as a result of the Optionholder's Disability, the
Optionholder may exercise his or her Option (to the extent that the Optionholder
was entitled to exercise it as of the date of termination), but only within such
period of time ending on the earlier of (i) the date twelve (12) months
following such termination or (ii) the expiration of the term of the Option as
set forth in the Option Agreement. If, after

<PAGE>

termination, the Optionholder does not exercise his or her Option within the
time specified herein, the Option shall terminate.

         (i) DEATH OF OPTIONHOLDER. In the event (i) an Optionholder's
Continuous Service terminates as a result of the Optionholder's death or (ii)
the Optionholder dies within the three-month period after the termination of the
Optionholder's Continuous Service for a reason other than death, then the Option
may be exercised (to the extent the Optionholder was entitled to exercise the
Option as of the date of death) by the Optionholder's estate, by a person who
acquired the right to exercise the Option by bequest or inheritance or by a
person designated to exercise the Option upon the Optionholder's death, but only
within the period ending on the earlier of (1) the date eighteen (18) months
following the date of death or (2) the expiration of the term of such Option as
set forth in the Option Agreement. If, after death, the Option is not exercised
within the time specified herein, the Option shall terminate.

8        COVENANTS OF THE COMPANY.

         (a) AVAILABILITY OF SHARES. During the terms of the Options, the
Company shall keep available at all times the number of shares of Common Stock
required to satisfy such Options.

         (b) SECURITIES LAW COMPLIANCE. The Company shall seek to obtain from
each regulatory commission or agency having jurisdiction over the Plan such
authority as may be required to grant Options and to issue and sell shares of
Common Stock upon exercise of the Options; provided, however, that this
undertaking shall not require the Company to register under the Securities Act
the Plan, any Option or any stock issued or issuable pursuant to any such
Option. If, after reasonable efforts, the Company is unable to obtain from any
such regulatory commission or agency the authority which counsel for the Company
deems necessary for the lawful issuance and sale of stock under the Plan, the
Company shall be relieved from any liability for failure to issue and sell stock
upon exercise of such Options unless and until such authority is obtained.

9        USE OF PROCEEDS FROM STOCK.

         Proceeds from the sale of stock pursuant to Options shall constitute
general funds of the Company.

10       MISCELLANEOUS.

         (a) STOCKHOLDER RIGHTS. No Optionholder shall be deemed to be the
holder of, or to have any of the rights of a holder with respect to, any shares
subject to such Option unless and until such Optionholder has satisfied all
requirements for exercise of the Option pursuant to its terms.

         (b) NO SERVICE RIGHTS. Nothing in the Plan or any instrument executed
or Option granted pursuant thereto shall confer upon any Optionholder any right
to continue to serve the Company as a Non-Employee Director or shall affect the
right of the Company or an Affiliate to terminate (i) the employment of an
Employee with or without notice and with or without cause, (ii) the service of a
Consultant pursuant to the terms of such Consultant's agreement with the Company
or an Affiliate or (iii) the service of a Director pursuant to the Bylaws of the
Company or an Affiliate, and any applicable provisions of the corporate law of
the state in which the Company or the Affiliate is incorporated, as the case may
be.

         (c) INVESTMENT ASSURANCES. The Company may require an Optionholder, as
a condition of exercising or acquiring stock under any Option, (i) to give
written assurances satisfactory to the Company as to the Optionholder's
knowledge and experience in financial and business matters and/or

<PAGE>

to employ a purchaser representative reasonably satisfactory to the Company who
is knowledgeable and experienced in financial and business matters and that he
or she is capable of evaluating, alone or together with the purchaser
representative, the merits and risks of exercising the Option; and (ii) to give
written assurances satisfactory to the Company stating that the Optionholder is
acquiring the stock subject to the Option for the Optionholder's own account and
not with any present intention of selling or otherwise distributing the stock.
The foregoing requirements, and any assurances given pursuant to such
requirements, shall be inoperative if (iii) the issuance of the shares upon the
exercise or acquisition of stock under the Option has been registered under a
then currently effective registration statement under the Securities Act or (iv)
as to any particular requirement, a determination is made by counsel for the
Company that such requirement need not be met in the circumstances under the
then applicable securities laws. The Company may, upon advice of counsel to the
Company, place legends on stock certificates issued under the Plan as such
counsel deems necessary or appropriate in order to comply with applicable
securities laws, including, but not limited to, legends restricting the transfer
of the stock.

         (d) WITHHOLDING OBLIGATIONS. The Optionholder may satisfy any federal,
state or local tax withholding obligation relating to the exercise or
acquisition of stock under an Option by any of the following means (in addition
to the Company's right to withhold from any compensation paid to the
Optionholder by the Company) or by a combination of such means: (i) tendering a
cash payment; (ii) authorizing the Company to withhold shares from the shares of
the Common Stock otherwise issuable to the Optionholder as a result of the
exercise or acquisition of stock under the Option, provided, however, that no
shares of Common Stock are withheld with a value exceeding the minimum amount of
tax required to be withheld by law; or (iii) delivering to the Company owned and
unencumbered shares of the Common Stock.

11       ADJUSTMENTS UPON CHANGES IN STOCK.

         (a) CAPITALIZATION ADJUSTMENTS. If any change is made in the stock
subject to the Plan, or subject to any Option, without the receipt of
consideration by the Company (through merger, consolidation, reorganization,
recapitalization, reincorporation, stock dividend, dividend in property other
than cash, stock split, liquidating dividend, combination of shares, exchange of
shares, change in corporate structure or other transaction not involving the
receipt of consideration by the Company), the Plan will be appropriately
adjusted in the class(es) and maximum number of securities subject both to the
Plan pursuant to subsection 4(a) and to the nondiscretionary Options specified
in Section 5, and the outstanding Options will be appropriately adjusted in the
class(es) and number of securities and price per share of stock subject to such
outstanding Options. The Board shall make such adjustments, and its
determination shall be final, binding and conclusive. (The conversion of any
convertible securities of the Company shall not be treated as a transaction
"without receipt of consideration" by the Company.)

         (b) CHANGE IN CONTROL -- DISSOLUTION OR LIQUIDATION. In the event of a
dissolution or liquidation of the Company, then all outstanding Options shall
terminate immediately prior to such event.

         (c) CHANGE IN CONTROL -- ASSET SALE, MERGER, CONSOLIDATION OR REVERSE
MERGER.

                  (i) In the event of (i) a sale, lease or other disposition of
         all or substantially all of the assets of the Company, (ii) a merger or
         consolidation in which the Company is not the surviving corporation or
         (iii) a reverse merger in which the Company is the surviving
         corporation but the shares of Common Stock outstanding immediately
         preceding the merger are converted by virtue of the merger into other
         property, whether in the form of securities, cash or otherwise, then
         any surviving corporation or acquiring corporation shall assume any
         Options outstanding under the

<PAGE>

         Plan or shall substitute similar Options (including an option to
         acquire the same consideration paid to the stockholders in the
         transaction described in this subsection 11(c) for those outstanding
         under the Plan).

                  (ii) In the event any surviving corporation or acquiring
         corporation refuses to assume such Options or to substitute similar
         Options for those outstanding under the Plan, then the vesting of such
         Options and the vesting of any shares of Common Stock acquired pursuant
         to such Options shall be accelerated in full, and the Options shall
         terminate if not exercised at or prior to such event.

                  (iii) In the event any surviving corporation or acquiring
         corporation assumes such Options or substitutes similar Options for
         those outstanding under the Plan but the Optionholder is not elected or
         appointed to the board of directors of the surviving corporation or
         acquiring corporation at the first meeting of such board of directors
         after such change in control event, then the vesting of such Options
         and the vesting of any shares of Common Stock acquired pursuant to such
         Options shall be accelerated by eighteen (18) months on the day after
         the first meeting of the board of directors of the surviving
         corporation or acquiring corporation.

                  (iv) In the event any surviving corporation or acquiring
         corporation assumes such Options or substitutes similar Options for
         those outstanding under the Plan and the Optionholder is elected or
         appointed to the board of directors of the surviving corporation or
         acquiring corporation at the first meeting of such board of directors
         after such change in control event, then the vesting of such Options
         and the vesting of any shares of Common Stock acquired pursuant to such
         Options shall not be accelerated.

12       AMENDMENT OF THE PLAN AND OPTIONS.

         (a) AMENDMENT OF PLAN. The Board at any time, and from time to time,
may amend the Plan. However, except as provided in Section 11 relating to
adjustments upon changes in stock, no amendment shall be effective unless
approved by the stockholders of the Company to the extent stockholder approval
is necessary to satisfy the requirements of Rule 16b-3 or any Nasdaq or
securities exchange listing requirements.

         (b) STOCKHOLDER APPROVAL. The Board may, in its sole discretion, submit
any other amendment to the Plan for stockholder approval.

         (c) NO IMPAIRMENT OF RIGHTS. Rights under any Option granted before
amendment of the Plan shall not be impaired by any amendment of the Plan unless
(i) the Company requests the consent of the Optionholder and (ii) the
Optionholder consents in writing.

         (d) AMENDMENT OF OPTIONS. The Board at any time, and from time to time,
may amend the terms of any one or more Options; provided, however, that the
rights under any Option shall not be impaired by any such amendment unless (i)
the Company requests the consent of the Optionholder and (ii) the Optionholder
consents in writing.

13       TERMINATION OR SUSPENSION OF THE PLAN.

         (a) PLAN TERM. The Board may suspend or terminate the Plan at any time.
Unless sooner terminated, the Plan shall terminate on the day before the tenth
(10th) anniversary of the date the Plan is adopted by the Board or approved by
the stockholders of the Company, whichever is earlier. No Options may be granted
under the Plan while the Plan is suspended or after it is terminated.

<PAGE>

         (b) NO IMPAIRMENT OF RIGHTS. Suspension or termination of the Plan
shall not impair rights and obligations under any Option granted while the Plan
is in effect except with the written consent of the Optionholder.

14       EFFECTIVE DATE OF PLAN.

         The Plan shall become effective on the IPO Date, but no Option shall be
exercised unless and until the Plan has been approved by the stockholders of the
Company, which approval shall be within twelve (12) months before or after the
date the Plan is adopted by the Board.

15       CHOICE OF LAW.

         All questions concerning the construction, validity and interpretation
of this Plan shall be governed by the law of the State of Delaware, without
regard to such state's conflict of laws rules.

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