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                                                                    EXHIBIT 10.1

                            JDS UNIPHASE CORPORATION

                           2003 EQUITY INCENTIVE PLAN

         1.       Purpose of the Plan. The purpose of this Plan is to provide
incentives to attract, retain and motivate eligible persons whose present and
potential contributions are important to the success of the Company by offering
them an opportunity to participate in the Company's future performance.

         2.       Definitions. As used herein, the following definitions shall
apply:

                  (a)      "Administrator" means the Board or any of the
Committees appointed to administer the Plan.

                  (b)      "Affiliate" and "Associate" shall have the respective
meanings ascribed to such terms in Rule 12b-2 promulgated under the Exchange
Act.

                  (c)      "Applicable Laws" means the legal requirements
relating to the Plan and the Awards under applicable provisions of federal
securities laws, state corporate and securities laws, the Code, the rules of any
applicable stock exchange or national market system, and the rules of any
non-U.S. jurisdiction applicable to Awards granted to residents therein.

                  (d)      "Assumed" means that pursuant to a Corporate
Transaction either (i) the Award is expressly affirmed by the Company or (ii)
the contractual obligations represented by the Award are expressly assumed (and
not simply by operation of law) by the successor entity or its Parent in
connection with the Corporate Transaction with appropriate adjustments to the
number and type of securities of the successor entity or its Parent subject to
the Award and the exercise or purchase price thereof which preserves the
compensation element of the Award existing at the time of the Corporate
Transaction as determined in accordance with the instruments evidencing the
agreement to assume the Award.

                  (e)      "Award" means the grant of an Option, SAR, Dividend
Equivalent Right, Restricted Stock, Performance Unit, Performance Share, or
other right or benefit under the Plan.

                  (f)      "Award Agreement" means the written agreement
evidencing the grant of an Award executed by the Company and the Grantee,
including any amendments thereto.

                  (g)      "Board" means the Board of Directors of the Company.

                  (h)      "Cause" means, with respect to the termination by the
Company or a Related Entity of the Grantee's Continuous Active Service, that
such termination is for "Cause" as such term is expressly defined in a
then-effective written agreement between the Grantee and the Company or such
Related Entity, or in the absence of such then-effective written agreement and
definition, is based on, in the determination of the Administrator, the
Grantee's: (i) performance of any act or failure to perform any act in bad faith
and to the detriment of the Company or a Related Entity; (ii) dishonesty,
intentional misconduct, material violation of any applicable Company or Related
Entity policy, or material breach of any agreement with the Company or a Related
Entity; or (iii) commission of a crime involving dishonesty, breach of trust, or
physical or emotional harm to any person.

                  (i)      "Change in Control" means a change in ownership or
control of the Company effected through either of the following transactions:

                           (i)      the direct or indirect acquisition by any
person or related group of persons (other than an acquisition from or by the
Company or by a Company-sponsored employee benefit plan or by a person that
directly or indirectly controls, is controlled by, or is under common control
with, the Company) of beneficial ownership (within the

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meaning of Rule 13d-3 of the Exchange Act) of securities possessing more than
fifty percent (50%) of the total combined voting power of the Company's
outstanding securities pursuant to a tender or exchange offer made directly to
the Company's stockholders which a majority of the Continuing Directors who are
not Affiliates or Associates of the offeror do not recommend such stockholders
accept, or

                           (ii)     a change in the composition of the Board
over a period of thirty-six (36) months or less such that a majority of the
Board members (rounded up to the next whole number) ceases, by reason of one or
more contested elections for Board membership, to be comprised of individuals
who are Continuing Directors.

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

                  (k)      "Committee" means any committee composed of members
of the Board appointed by the Board to administer the Plan.

                  (l)      "Common Stock" means the common stock of the Company.

                  (m)      "Company" means JDS Uniphase Corporation, a Delaware
corporation.

                  (n)      "Consultant" means any person (other than an Employee
or a Director, solely with respect to rendering services in such person's
capacity as a Director) who is engaged by the Company or any Related Entity to
render consulting or advisory services to the Company or such Related Entity.

                  (o)      "Continuing Directors" means members of the Board who
either (i) have been Board members continuously for a period of at least
thirty-six (36) months or (ii) have been Board members for less than thirty-six
(36) months and were elected or nominated for election as Board members by at
least a majority of the Board members described in clause (i) who were still in
office at the time such election or nomination was approved by the Board.

                  (p)      "Continuous Active Service" means that the provision
of services to the Company or a Related Entity in any capacity of Employee,
Director or Consultant is not interrupted or terminated. In jurisdictions
requiring notice in advance of an effective termination as an Employee, Director
or Consultant, Continuous Active Service shall be deemed terminated upon the
actual cessation of providing services to the Company or a Related Entity
notwithstanding any required notice period that must be fulfilled before a
termination as an Employee, Director or Consultant can be effective under
Applicable Laws. Continuous Active Service shall not be considered interrupted
in the case of (i) any approved leave of absence, (ii) transfers among the
Company, any Related Entity, or any successor, in any capacity of Employee,
Director or Consultant, or (iii) any change in status as long as the individual
remains in the service of the Company or a Related Entity in any capacity of
Employee, Director or Consultant (except as otherwise provided in the Award
Agreement). An approved leave of absence shall include sick leave, military
leave, or any other authorized personal leave. For purposes of each Incentive
Stock Option granted under the Plan, if such leave exceeds ninety (90) days, and
reemployment upon expiration of such leave is not guaranteed by statute or
contract, then the Incentive Stock Option shall be treated as a Non-Qualified
Stock Option on the day three (3) months and one (1) day following the
expiration of such ninety (90) day period.

                  (q)      "Corporate Transaction" means any of the following
transactions:

                           (i)      a merger or consolidation in which the
Company is not the surviving entity, except for a transaction the principal
purpose of which is to change the state in which the Company is incorporated;

                           (ii)     the sale, transfer or other disposition of
all or substantially all of the assets of the Company;

                           (iii)    the complete liquidation or dissolution of
the Company;

                           (iv)     any reverse merger or series of related
transactions culminating in a reverse merger (including, but not limited to, a
tender offer followed by a reverse merger) in which the Company is the surviving
entity but

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in which securities possessing more than forty percent (40%) of the total
combined voting power of the Company's outstanding securities are transferred to
a person or persons different from those who held such securities immediately
prior to such merger or the initial transaction culminating in such merger but
excluding any such transaction or series of related transactions that the
Administrator determines shall not be a Corporate Transaction; or

                           (v)      acquisition in a single or series of related
transactions by any person or related group of persons (other than the Company
or by a Company-sponsored employee benefit plan) of beneficial ownership (within
the meaning of Rule 13d-3 of the Exchange Act) of securities possessing more
than fifty percent (50%) of the total combined voting power of the Company's
outstanding securities but excluding any such transaction or series of related
transactions that the Administrator determines shall not be a Corporate
Transaction.

                  (r)      "Covered Employee" means an Employee who is a
"covered employee" under Section 162(m)(3) of the Code.

                  (s)      "Director" means a member of the Board or the board
of directors of any Related Entity.

                  (t)      "Disability" means as defined under the long-term
disability policy of the Company or the Related Entity to which the Grantee
provides services regardless of whether the Grantee is covered by such policy.
If the Company or the Related Entity to which the Grantee provides service does
not have a long-term disability plan in place, "Disability" means that a Grantee
is unable to carry out the responsibilities and functions of the position held
by the Grantee by reason of any medically determinable physical or mental
impairment for a period of not less than ninety (90) consecutive days. A Grantee
will not be considered to have incurred a Disability unless he or she furnishes
proof of such impairment sufficient to satisfy the Administrator in its
discretion.

                  (u)      "Dividend Equivalent Right" means a right entitling
the Grantee to compensation measured by dividends paid with respect to Common
Stock.

                  (v)      "Employee" means any person, including an Officer or
Director, who is in the employ of the Company or any Related Entity, subject to
the control and direction of the Company or any Related Entity as to both the
work to be performed and the manner and method of performance. The payment of a
director's fee by the Company or a Related Entity shall not be sufficient to
constitute "employment" by the Company.

                  (w)      "Exchange Act" means the Securities Exchange Act of
1934, as amended.

                  (x)      "Fair Market Value" means, as of any date, the value
of Common Stock determined as follows:

                           (i)      If the Common Stock is listed on any
established stock exchange or a national market system, including without
limitation The Nasdaq National Market or The Nasdaq SmallCap Market of The
Nasdaq Stock Market, its Fair Market Value shall be the closing sales price for
such stock (or the closing bid, if no sales were reported) as quoted on such
exchange or system on the date of determination (or, if no closing sales price
or closing bid was reported on that date, as applicable, on the last trading
date such closing sales price or closing bid was reported), as reported in The
Wall Street Journal or such other source as the Administrator deems reliable;

                           (ii)     If the Common Stock is regularly quoted on
an automated quotation system (including the OTC Bulletin Board) or by a
recognized securities dealer, but selling prices are not reported, the Fair
Market Value of a share of Common Stock shall be the mean between the high bid
and low asked prices for the Common Stock on the date of determination (or, if
no such prices were reported on that date, on the last date such prices were
reported), as reported in The Wall Street Journal or such other source as the
Administrator deems reliable; or

                           (iii)    In the absence of an established market for
the Common Stock of the type described in (i) and (ii), above, the Fair Market
Value thereof shall be determined by the Administrator in good faith.

                  (y)      "Grantee" means an Employee, Director or Consultant
who receives an Award under the Plan.

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                  (z)      "Immediate Family" means any child, stepchild,
grandchild, parent, stepparent, grandparent, spouse, former spouse, sibling,
niece, nephew, mother-in-law, father-in-law, son-in law, daughter-in-law,
brother-in-law, or sister-in-law, including adoptive relationships, any person
sharing the Grantee's household (other than a tenant or employee), a trust in
which these persons (or the Grantee) have more than fifty percent (50%) of the
beneficial interest, a foundation in which these persons (or the Grantee)
control the management of assets, and any other entity in which these persons
(or the Grantee) own more than fifty percent (50%) of the voting interests.

                  (aa)     "Incentive Stock Option" means an Option intended to
qualify as an incentive stock option within the meaning of Section 422 of the
Code

                  (bb)     "Non-Qualified Stock Option" means an Option not
intended to qualify as an Incentive Stock Option.

                  (cc)     "Officer" means a person who is an officer of the
Company or a Related Entity within the meaning of Section 16 of the Exchange Act
and the rules and regulations promulgated thereunder.

                  (dd)     "Option" means an option to purchase Shares pursuant
to an Award Agreement granted under the Plan.

                  (ee)     "Parent" means a "parent corporation", whether now or
hereafter existing, as defined in Section 424(e) of the Code.

                  (ff)     "Performance-Based Compensation" means compensation
qualifying as "performance-based compensation" under Section 162(m) of the Code.

                  (gg)     "Performance Shares" means Shares or an Award
denominated in Shares which may be earned in whole or in part upon attainment of
performance criteria established by the Administrator.

                  (hh)     "Performance Units" means an Award which may be
earned in whole or in part based upon attainment of performance criteria
established by the Administrator and which may be settled for cash, Shares or
other securities or a combination of cash, Shares or other securities as
established by the Administrator.

                  (ii)     "Plan" means this 2003 Equity Incentive Plan.

                  (jj)     "Related Entity" means any Parent or Subsidiary of
the Company and any business, corporation, partnership, limited liability
company or other entity in which the Company or a Parent or a Subsidiary of the
Company holds a substantial ownership interest, directly or indirectly.

                  (kk)     "Replaced" means that pursuant to a Corporate
Transaction the Award is replaced with a comparable stock award or a cash
incentive program of the Company, the successor entity (if applicable) or Parent
of either of them which preserves the compensation element of such Award
existing at the time of the Corporate Transaction and provides for subsequent
payout in accordance with the same (or a more favorable) vesting schedule
applicable to such Award. The determination of Award comparability shall be made
by the Administrator and its determination shall be final, binding and
conclusive.

                  (ll)     "Restricted Stock" means Shares issued under the Plan
to the Grantee for such consideration, if any, and subject to such restrictions
on transfer, rights of first refusal, repurchase provisions, forfeiture
provisions, and other terms and conditions as established by the Administrator.

                  (mm)     "Rule 16b-3" means Rule 16b-3 promulgated under the
Exchange Act or any successor thereto.

                  (nn)     "SAR" means a stock appreciation right entitling the
Grantee to Shares or cash compensation, as established by the Administrator,
measured by appreciation in the value of Common Stock.

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                  (oo)     "Share" means a share of the Common Stock.

                  (pp)     "Subsidiary" means a "subsidiary corporation",
whether now or hereafter existing, as defined in Section 424(f) of the Code.

         3.       Stock Subject to the Plan.

                  (a)      Subject to the provisions of Section 10 below, the
maximum aggregate number of Shares which may be issued pursuant to all Awards
(including Incentive Stock Options) is 140,000,000 Shares. Notwithstanding the
foregoing, no more than twenty percent (20%) of the aggregate number of Shares
reserved for issuance under the Plan pursuant to the preceding sentence may be
issued pursuant to all Awards of Restricted Stock. The Shares to be issued
pursuant to Awards may be authorized, but unissued, or reacquired Common Stock.

                  (b)      The maximum number of Shares with respect to which
Awards may be issued to Covered Employees as a group in any fiscal year of the
Company shall be limited to five percent (5%) of the total number of Shares
subject to Awards issued during such fiscal year. Notwithstanding the preceding
sentence, Awards to Covered Employees made in connection with such Covered
Employees' commencement of employment with the Company or promotion (either to a
position which would result in an employee becoming a Covered Employee, or the
promotion of a Covered Employee from one position to another) shall not be
included for purposes of calculating whether such limitation has been reached.

                  (c)      Any Shares covered by an Award (or portion of an
Award) which is forfeited, canceled or expires (whether voluntarily or
involuntarily) shall be deemed not to have been issued for purposes of
determining the maximum aggregate number of Shares which may be issued under the
Plan. Shares that actually have been issued under the Plan pursuant to an Award
shall not be returned to the Plan and shall not become available for future
issuance under the Plan, except that if unvested Shares are forfeited, or
repurchased by the Company at the lower of their original purchase price or
their Fair Market Value at the time of repurchase, such Shares shall become
available for future grant under the Plan.

         4.       Administration of the Plan.

                  (a)      Plan Administrator.

                           (i)      Administration with Respect to Directors and
Officers. With respect to grants of Awards to Directors or Employees who are
also Officers or Directors of the Company, the Plan shall be administered by (A)
the Board or (B) a Committee designated by the Board, which Committee shall be
constituted in such a manner as to satisfy the Applicable Laws and to permit
such grants and related transactions under the Plan to be exempt from Section
16(b) of the Exchange Act in accordance with Rule 16b-3. Once appointed, such
Committee shall continue to serve in its designated capacity until otherwise
directed by the Board.

                           (ii)     Administration With Respect to Consultants
and Other Employees. With respect to grants of Awards to Employees or
Consultants who are neither Directors nor Officers of the Company, the Plan
shall be administered by (A) the Board or (B) a Committee designated by the
Board, which Committee shall be constituted in such a manner as to satisfy the
Applicable Laws. Once appointed, such Committee shall continue to serve in its
designated capacity until otherwise directed by the Board. The Board may
authorize one or more Officers to grant such Awards and may limit such authority
as the Board determines from time to time.

                           (iii)    Administration With Respect to Covered
Employees. Notwithstanding the foregoing, grants of Awards to any Covered
Employee intended to qualify as Performance-Based Compensation shall be made
only by a Committee (or subcommittee of a Committee) which is comprised solely
of two or more Directors eligible to serve on a committee making Awards
qualifying as Performance-Based Compensation. In the case of such Awards granted
to Covered Employees, references to the "Administrator" or to a "Committee"
shall be deemed to be references to such Committee or subcommittee.

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                           (iv)     Administration Errors. In the event an Award
is granted in a manner inconsistent with the provisions of this subsection (a),
such Award shall be presumptively valid as of its grant date to the extent
permitted by the Applicable Laws.

                  (b)      Powers of the Administrator. Subject to Applicable
Laws and the provisions of the Plan (including any other powers given to the
Administrator hereunder), and except as otherwise provided by the Board, the
Administrator shall have the authority, in its discretion:

                           (i)      to select the Employees, Directors and
Consultants to whom Awards may be granted from time to time hereunder;

                           (ii)     to determine whether and to what extent
Awards are granted hereunder;

                           (iii)    to determine the number of Shares or the
amount of other consideration to be covered by each Award granted hereunder;

                           (iv)     to approve forms of Award Agreements for use
under the Plan;

                           (v)      to determine the terms and conditions of any
Award granted hereunder;

                           (vi)     to amend the terms of any outstanding Award
granted under the Plan, provided that (A) any amendment that would adversely
affect the Grantee's rights under an outstanding Award shall not be made without
the Grantee's written consent, (B) the reduction of the exercise price of any
Option awarded under the Plan shall be subject to stockholder approval and (C)
canceling an Option at a time when its exercise price exceeds the Fair Market
Value of the underlying Shares, in exchange for another Option, Restricted
Stock, or other Award shall be subject to stockholder approval, unless the
cancellation and exchange occurs in connection with a Corporate Transaction;

                           (vii)    to construe and interpret the terms of the
Plan and Awards, including without limitation, any notice of award or Award
Agreement, granted pursuant to the Plan;

                           (viii)   to establish additional terms, conditions,
rules or procedures to accommodate the rules or laws of applicable non-U.S.
jurisdictions and to afford Grantees favorable treatment under such rules or
laws; provided, however, that no Award shall be granted under any such
additional terms, conditions, rules or procedures with terms or conditions which
are inconsistent with the provisions of the Plan; and

                           (ix)     to take such other action, not inconsistent
with the terms of the Plan, as the Administrator deems appropriate.

                  (c)      Indemnification. In addition to such other rights of
indemnification as they may have as members of the Board or as Officers or
Employees of the Company or a Related Entity, members of the Board and any
Officers or Employees of the Company or a Related Entity to whom authority to
act for the Board, the Administrator or the Company is delegated shall be
defended and indemnified by the Company to the extent permitted by law on an
after-tax basis against all reasonable expenses, including attorneys' fees,
actually and necessarily incurred in connection with the defense of any claim,
investigation, action, suit or proceeding, or in connection with any appeal
therein, to which they or any of them may be a party by reason of any action
taken or failure to act under or in connection with the Plan, or any Award
granted hereunder, and against all amounts paid by them in settlement thereof
(provided such settlement is approved by the Company) or paid by them in
satisfaction of a judgment in any such claim, investigation, action, suit or
proceeding, except in relation to matters as to which it shall be adjudged in
such claim, investigation, action, suit or proceeding that such person is liable
for gross negligence, bad faith or intentional misconduct; provided, however,
that within thirty (30) days after the institution of such claim, investigation,
action, suit or proceeding, such person shall offer to the Company, in writing,
the opportunity at the Company's expense to handle and defend the same.

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         5.       Eligibility. Awards other than Incentive Stock Options may be
granted to Employees, Directors and Consultants. Incentive Stock Options may be
granted only to Employees of the Company or a Parent or a Subsidiary of the
Company. An Employee, Director or Consultant who has been granted an Award may,
if otherwise eligible, be granted additional Awards. Awards may be granted to
such Employees, Directors or Consultants who are residing in non-U.S.
jurisdictions as the Administrator may determine from time to time.

         6.       Terms and Conditions of Awards.

                  (a)      Type of Awards. The Administrator is authorized under
the Plan to award any type of arrangement to an Employee, Director or Consultant
that is not inconsistent with the provisions of the Plan and that by its terms
involves or might involve the issuance of (i) Shares, (ii) cash or (iii) an
Option, a SAR, or similar right with a fixed or variable price related to the
Fair Market Value of the Shares and with an exercise or conversion privilege
related to the passage of time, the occurrence of one or more events, or the
satisfaction of performance criteria or other conditions. Such awards include,
without limitation, Options, SARs, Restricted Stock, Dividend Equivalent Rights,
Performance Units or Performance Shares, and an Award may consist of one such
security or benefit, or two (2) or more of them in any combination or
alternative.

                  (b)      Designation of Award. Each Award shall be designated
in the Award Agreement. In the case of an Option, the Option shall be designated
as either an Incentive Stock Option or a Non-Qualified Stock Option. However,
notwithstanding such designation, to the extent that the aggregate Fair Market
Value of Shares subject to Options designated as Incentive Stock Options which
become exercisable for the first time by a Grantee during any calendar year
(under all plans of the Company or any Parent or Subsidiary of the Company)
exceeds $100,000, such excess Options, to the extent of the Shares covered
thereby in excess of the foregoing limitation, shall be treated as Non-Qualified
Stock Options. For this purpose, Incentive Stock Options shall be taken into
account in the order in which they were granted, and the Fair Market Value of
the Shares shall be determined as of the grant date of the relevant Option.

                  (c)      Conditions of Award. Subject to the terms of the
Plan, the Administrator shall determine the provisions, terms, and conditions of
each Award including, but not limited to, the Award vesting schedule, repurchase
provisions, rights of first refusal, forfeiture provisions, form of payment
(cash, Shares, or other consideration) upon settlement of the Award, payment
contingencies, and satisfaction of any performance criteria. The performance
criteria established by the Administrator may be based on any one of, or
combination of, the following: (i) increase in share price, (ii) earnings per
share, (iii) total stockholder return, (iv) operating margin, (v) gross margin,
(vi) return on equity, (vii) return on assets, (viii) return on investment, (ix)
operating income, (x) net operating income, (xi) pre-tax profit, (xii) cash
flow, (xiii) revenue, (xiv) expenses, (xv) earnings before interest, taxes and
depreciation, (xvi) economic value added, (xvii) market share, (xviii) personal
management objectives, and (xix) other measures of performance selected by the
Administrator. Partial achievement of the specified criteria may result in a
payment or vesting corresponding to the degree of achievement as specified in
the Award Agreement.

                  (d)      Acquisitions and Other Transactions. The
Administrator may issue Awards under the Plan in settlement, assumption or
substitution for, outstanding awards or obligations to grant future awards in
connection with the Company or a Related Entity acquiring another entity, an
interest in another entity or an additional interest in a Related Entity whether
by merger, stock purchase, asset purchase or other form of transaction.

                  (e)      Deferral of Award Payment. The Administrator may
establish one or more programs under the Plan to permit selected Grantees the
opportunity to elect to defer receipt of consideration upon exercise of an
Award, satisfaction of performance criteria, or other event that absent the
election would entitle the Grantee to payment or receipt of Shares or other
consideration under an Award. The Administrator may establish the election
procedures, the timing of such elections, the mechanisms for payments of, and
accrual of interest or other earnings, if any, on amounts, Shares or other
consideration so deferred, and such other terms, conditions, rules and
procedures that the Administrator deems advisable for the administration of any
such deferral program.

                  (f)      Separate Programs. The Administrator may establish
one or more separate programs under the Plan for the purpose of issuing
particular forms of Awards to one or more classes of Grantees on such terms and
conditions as determined by the Administrator from time to time.

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                  (g)      Individual Limitations on Awards. The maximum number
of Shares with respect to which Awards may be granted to any Grantee in any
fiscal year of the Company shall be three million (3,000,000) Shares. In
connection with a Grantee's (i) commencement of Continuous Active Service or
(ii) first promotion in any fiscal year of the Company, a Grantee may be granted
Awards for up to an additional (2,000,000) Shares which shall not count against
the limit set forth in the preceding sentence. The foregoing limitations shall
be adjusted proportionately in connection with any change in the Company's
capitalization pursuant to Section 10, below. To the extent required by Section
162(m) of the Code or the regulations thereunder, in applying the foregoing
limitations with respect to a Grantee, if any Awards are canceled, the canceled
Awards shall continue to count against the maximum number of Shares with respect
to which Awards may be granted to the Grantee. For this purpose, the repricing
of an Option (or in the case of a SAR, the base amount on which the stock
appreciation is calculated is reduced to reflect a reduction in the Fair Market
Value of the Common Stock) shall be treated as the cancellation of the existing
Option or SAR and the grant of a new Option or SAR. If the vesting or receipt of
Shares under the Award is deferred to a later date, any amount (whether
denominated in Shares or cash) paid in addition to the original number of Shares
subject to the Award will not be treated as an increase in the number of Shares
subject to the Award if the additional amount is based either on a reasonable
rate of interest or on one or more predetermined actual investments such that
the amount payable by the Company at the later date will be based on the actual
rate of return of a specific investment (including any decrease as well as any
increase in the value of an investment).

                  (h)      Early Exercise. The Award Agreement may, but need
not, include a provision whereby the Grantee may elect at any time while an
Employee, Director or Consultant to exercise any part or all of the Award prior
to full vesting of the Award. Any unvested Shares received pursuant to such
exercise may be subject to a repurchase right in favor of the Company or a
Related Entity or to any other restriction the Administrator determines to be
appropriate.

                  (i)      Term of Award. The term of each Award shall be the
term stated in the Award Agreement, provided, however, that the term of an Award
shall be no more than eight (8) years from the date of grant thereof. However,
in the case of an Incentive Stock Option granted to a Grantee who, at the time
the Option is granted, owns stock representing more than ten percent (10%) of
the voting power of all classes of stock of the Company or any Parent or
Subsidiary of the Company, the term of the Incentive Stock Option shall be five
(5) years from the date of grant thereof or such shorter term as may be provided
in the Award Agreement.

                  (j)      Transferability of Awards. Incentive Stock Options
may not be sold, pledged, assigned, hypothecated, transferred, or disposed of in
any manner other than by will or by the laws of descent or distribution and may
be exercised, during the lifetime of the Grantee, only by the Grantee. Other
Awards shall be transferable by will and by the laws of descent and
distribution, and during the lifetime of the Grantee, by gift or pursuant to a
domestic relations order to members of the Grantee's Immediate Family to the
extent and in the manner determined by the Administrator. Notwithstanding the
foregoing, the Grantee may designate a beneficiary of the Grantee's Award in the
event of the Grantee's death on a beneficiary designation form provided by the
Administrator.

                  (k)      Time of Granting Awards. The date of grant of an
Award shall for all purposes be the date on which the Administrator makes the
determination to grant such Award, or such later date as is determined by the
Administrator.

         7.       Award Exercise or Purchase Price, Consideration and Taxes.

                  (a)      Exercise or Purchase Price. The exercise or purchase
price, if any, for an Award shall be as follows:

                           (i)      In the case of an Incentive Stock Option:

                                    (1)      granted to an Employee who, at the
time of the grant of such Incentive Stock Option owns stock representing more
than ten percent (10%) of the voting power of all classes of stock of the
Company or any Parent or Subsidiary of the Company, the per Share exercise price
shall be not less than one hundred ten percent (110%) of the Fair Market Value
per Share on the date of grant; or

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                                    (2)      granted to any Employee other than
an Employee described in the preceding paragraph, the per Share exercise price
shall be not less than one hundred percent (100%) of the Fair Market Value per
Share on the date of grant.

                           (ii)     In the case of a Non-Qualified Stock Option,
the per Share exercise price shall be not less than one hundred percent (100%)
of the Fair Market Value per Share on the date of grant.

                           (iii)    In the case of a SAR, the base amount on
which the stock appreciation is calculated shall be not less than one hundred
percent (100%) of the Fair Market Value per Share on the date of grant.

                           (iv)     In the case of Awards intended to qualify as
Performance-Based Compensation, the exercise or purchase price, if any, shall be
not less than one hundred percent (100%) of the Fair Market Value per Share on
the date of grant.

                           (v)      In the case of other Awards, such price as
is determined by the Administrator.

                           (vi)     Notwithstanding the foregoing provisions of
this Section 7(a), in the case of an Award issued pursuant to Section 6(d),
above, the exercise or purchase price for the Award shall be determined in
accordance with the provisions of the relevant instrument evidencing the
agreement to issue such Award.

                  (b)      Consideration. Subject to Applicable Laws, the
consideration to be paid for the Shares to be issued upon exercise or purchase
of an Award including the method of payment, shall be determined by the
Administrator (and, in the case of an Incentive Stock Option, shall be
determined at the time of grant). In addition to any other types of
consideration the Administrator may determine, the Administrator is authorized
to accept as consideration for Shares issued under the Plan the following,
provided that the portion of the consideration equal to the par value of the
Shares must be paid in cash or other legal consideration permitted by the
Delaware General Corporation Law:

                           (i)      cash;

                           (ii)     check;

                           (iii)    surrender of Shares or delivery of a
properly executed form of attestation of ownership of Shares as the
Administrator may require (including withholding of Shares otherwise deliverable
upon exercise of the Award) which have a Fair Market Value on the date of
surrender or attestation equal to the aggregate exercise price of the Shares as
to which said Award shall be exercised, provided, however, that Shares acquired
under the Plan or any other equity compensation plan or agreement of the Company
must have been held by the Grantee for a period of more than six (6) months;

                           (iv)     with respect to Options, payment through a
broker-dealer sale and remittance procedure pursuant to which the Grantee (A)
shall provide written instructions to a Company designated brokerage firm to
effect the immediate sale of some or all of the purchased Shares and remit to
the Company sufficient funds to cover the aggregate exercise price payable for
the purchased Shares and (B) shall provide written directives to the Company to
deliver the certificates for the purchased Shares directly to such brokerage
firm in order to complete the sale transaction; or

                           (v)      any combination of the foregoing methods of
payment.

                  (c)      Taxes. No Shares shall be delivered under the Plan to
any Grantee or other person until such Grantee or other person has made
arrangements acceptable to the Administrator for the satisfaction of any
non-U.S., federal, state, or local income and employment tax withholding
obligations, including, without limitation, obligations incident to the receipt
of Shares or the disqualifying disposition of Shares received on exercise of an
Incentive Stock Option. Upon exercise of an Award the Company shall withhold or
collect from Grantee an amount sufficient to satisfy such tax obligations.

         8.       Exercise of Award.

<PAGE>

                  (a)      Procedure for Exercise; Rights as a Stockholder.

                           (i)      Any Award granted hereunder shall be
exercisable at such times and under such conditions as determined by the
Administrator under the terms of the Plan and specified in the Award Agreement.

                           (ii)     An Award shall be deemed to be exercised
when written notice of such exercise has been given to the Company in accordance
with the terms of the Award by the person entitled to exercise the Award and
full payment for the Shares with respect to which the Award is exercised,
including, to the extent selected, use of the broker-dealer sale and remittance
procedure to pay the purchase price as provided in Section 7(b)(iv).

                  (b)      Exercise of Award Following Termination of Continuous
Active Service.

                           (i)      An Award may not be exercised after the
termination date of such Award set forth in the Award Agreement and may be
exercised following the termination of a Grantee's Continuous Active Service
only to the extent provided in the Award Agreement.

                           (ii)     Where the Award Agreement permits a Grantee
to exercise an Award following the termination of the Grantee's Continuous
Active Service for a specified period, the Award shall terminate to the extent
not exercised on the last day of the specified period or the last day of the
original term of the Award, whichever occurs first.

                           (iii)    Any Award designated as an Incentive Stock
Option to the extent not exercised within the time permitted by law for the
exercise of Incentive Stock Options following the termination of a Grantee's
Continuous Active Service shall convert automatically to a Non-Qualified Stock
Option and thereafter shall be exercisable as such to the extent exercisable by
its terms for the period specified in the Award Agreement.

         9.       Conditions Upon Issuance of Shares.

                  (a)      Shares shall not be issued pursuant to the exercise
of an Award unless the exercise of such Award and the issuance and delivery of
such Shares pursuant thereto shall comply with all Applicable Laws, and shall be
further subject to the approval of counsel for the Company with respect to such
compliance.

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

         10.      Adjustments Upon Changes in Capitalization. Subject to any
required action by the stockholders of the Company, the number of Shares covered
by each outstanding Award, and the number of Shares which have been authorized
for issuance under the Plan but as to which no Awards have yet been granted or
which have been returned to the Plan, the exercise or purchase price of each
such outstanding Award, the maximum number of Shares with respect to which
Awards may be granted to any Grantee in any fiscal year of the Company, as well
as any other terms that the Administrator determines require adjustment shall be
proportionately adjusted for (i) any increase or decrease in the number of
issued Shares resulting from a stock split, reverse stock split, stock dividend,
combination or reclassification of the Shares, or similar transaction affecting
the Shares, (ii) any other increase or decrease in the number of issued Shares
effected without receipt of consideration by the Company, or (iii) as the
Administrator may determine in its discretion, any other transaction with
respect to Common Stock including a corporate merger, consolidation, acquisition
of property or stock, separation (including a spin-off or other distribution of
stock or property), reorganization, liquidation (whether partial or complete) or
any similar transaction; provided, however that conversion of any convertible
securities of the Company shall not be deemed to have been "effected without
receipt of consideration." Such adjustment shall be made by the Administrator
and the Administrator's determination shall be final, binding and conclusive.
Except as the Administrator determines, no issuance by the Company of shares of
stock of any class, or securities convertible into shares of stock of any class,
shall affect, and no adjustment by reason hereof shall be made with respect to,
the number or price of Shares subject to an Award.

<PAGE>

         11.      Corporate Transactions.

                  (a)      Termination of Award to Extent Not Assumed in
Corporate Transaction. Effective upon the consummation of a Corporate
Transaction, all outstanding Awards under the Plan shall terminate. However, all
such Awards shall not terminate to the extent they are Assumed in connection
with the Corporate Transaction.

                  (b)      Acceleration of Award Upon Corporate Transaction.
Except as provided otherwise in an individual Award Agreement, in the event of a
Corporate Transaction, for the portion of each Award that is neither Assumed nor
Replaced, such portion of the Award shall automatically become fully vested and
exercisable and be released from any repurchase or forfeiture rights (other than
repurchase rights exercisable at fair market value) for all of the Shares at the
time represented by such portion of the Award, immediately prior to the
specified effective date of such Corporate Transaction.

                  (c)      Effect of Acceleration on Incentive Stock Options.
Any Incentive Stock Option accelerated under this Section 11 in connection with
a Corporate Transaction shall remain exercisable as an Incentive Stock Option
under the Code only to the extent the $100,000 dollar limitation of Section
422(d) of the Code is not exceeded. To the extent such dollar limitation is
exceeded, the excess Options shall be treated as Non-Qualified Stock Options.

         12.      Effective Date and Term of Plan. The Plan shall become
effective upon its approval by the stockholders of the Company. It shall
continue in effect for a term of ten (10) years unless sooner terminated.
Subject to Applicable Laws, Awards may be granted under the Plan upon its
becoming effective.

         13.      Amendment, Suspension or Termination of the Plan.

                  (a)      The Board may at any time amend, suspend or terminate
the Plan; provided, however, that no such amendment shall be made without the
approval of the Company's stockholders to the extent such approval is required
by Applicable Laws, or if such amendment would change any of the provisions of
Section 4(b)(vi) or this Section 13(a).

                  (b)      No Award may be granted during any suspension of the
Plan or after termination of the Plan.

                  (c)      No suspension or termination of the Plan (including
termination of the Plan under Section 12, above) shall adversely affect any
rights under Awards already granted to a Grantee.

         14.      Reservation of Shares.

                  (a)      The Company, during the term of the Plan, will at all
times reserve and keep available such number of Shares as shall be sufficient to
satisfy the requirements of the Plan.

                  (b)      The inability of the Company to obtain authority from
any regulatory body having jurisdiction, which authority is deemed by the
Company's counsel to be necessary to the lawful issuance and sale of any Shares
hereunder, shall relieve the Company of any liability in respect of the failure
to issue or sell such Shares as to which such requisite authority shall not have
been obtained.

         15.      No Effect on Terms of Employment/Consulting Relationship. The
Plan shall not confer upon any Grantee any right with respect to the Grantee's
Continuous Active Service, nor shall it interfere in any way with his or her
right or the right of the Company or any Related Entity to terminate the
Grantee's Continuous Active Service at any time, with or without Cause, and with
or without notice. The ability of the Company or any Related Entity to terminate
the employment of a Grantee who is employed at will is in no way affected by its
determination that the Grantee's Continuous Active Service has been terminated
for Cause for the purposes of this Plan.

         16.      No Effect on Retirement and Other Benefit Plans. Except as
specifically provided in a retirement or other benefit plan of the Company or a
Related Entity, Awards shall not be deemed compensation for purposes of
computing benefits or contributions under any retirement plan of the Company or
a Related Entity, and shall not affect any benefits under any other benefit plan
of any kind or any benefit plan subsequently instituted under which the
availability or amount of

<PAGE>

benefits is related to level of compensation. The Plan is not a "Retirement
Plan" or "Welfare Plan" under the Employee Retirement Income Security Act of
1974, as amended.

         17.      Unfunded Obligation. Grantees shall have the status of general
unsecured creditors of the Company. Any amounts payable to Grantees pursuant to
the Plan shall be unfunded and unsecured obligations for all purposes,
including, without limitation, Title I of the Employee Retirement Income
Security Act of 1974, as amended. Neither the Company nor any Related Entity
shall be required to segregate any monies from its general funds, or to create
any trusts, or establish any special accounts with respect to such obligations.
The Company shall retain at all times beneficial ownership of any investments,
including trust investments, which the Company may make to fulfill its payment
obligations hereunder. Any investments or the creation or maintenance of any
trust or any Grantee account shall not create or constitute a trust or fiduciary
relationship between the Administrator, the Company or any Related Entity and a
Grantee, or otherwise create any vested or beneficial interest in any Grantee or
the Grantee's creditors in any assets of the Company or a Related Entity. The
Grantees shall have no claim against the Company or any Related Entity for any
changes in the value of any assets that may be invested or reinvested by the
Company with respect to the Plan.<PAGE>

                                                                   EXHIBIT 10.30

[UNION BANK OF CALIFORNIA LOGO]

                   SECOND AMENDED AND RESTATED LOAN AGREEMENT

         THIS AMENDED AND RESTATED LOAN AGREEMENT ("Agreement") is made and
entered into as of September 22, 2003 by and between Sparta, Inc., a Delaware
corporation ("Borrower"), and UNION BANK OF CALIFORNIA, N.A. ("Bank"). This
Agreement amends and restates in its entirety that certain loan agreement dated
as of September 9, 1999 by and between Borrower and Bank, as amended.

         SECTION  1. THE LOAN

                           1.1      THE REVOLVING LOAN. Bank will loan to
Borrower an amount not to exceed Six Million Dollars ($6,000,000) outstanding in
the aggregate at any one time (the "Revolving Loan"). Borrower may borrow, repay
and reborrow all or part of the Revolving Loan in accordance with the terms of
the Revolving Note. All borrowings of the Revolving Loan must be made before
July 1, 2005 at which time all unpaid principal and interest of the Revolving
Loan shall be due and payable. The Revolving Loan shall be evidenced by a
promissory note (the "Revolving Note") on the standard form used by Bank for
commercial loans. Bank shall enter each amount borrowed and repaid in Bank's
records and such entries shall be deemed to be the amount of the Revolving Loan
outstanding. Omission of Bank to make any such entries shall not discharge
Borrower of its obligation to repay in full with interest all amounts borrowed.

                  1.2      TERMINOLOGY.

                           As used herein the word "Loan" shall mean,
collectively, all the credit facilities described above.

                           As used herein the word "Note" shall mean,
collectively, all the promissory notes described above.

                           As used herein, the words "Loan Documents" shall mean
all documents executed in connection with this Agreement.

                  1.3      PURPOSE OF LOAN. The proceeds of the Revolving Loan
shall be used for working capital and general corporate purposes.

                  1.4      INTEREST. The unpaid principal balance of the
Revolving Loan shall bear interest at the rate or rates provided in the
Revolving Note and selected by Borrower. The Revolving Loan may be prepaid in
full or in part only in accordance with the terms of the Revolving Note and any
such prepayment shall be subject to the prepayment fee provided for therein.

                  1.5      UNUSED COMMITMENT FEE. Commencing on September 30,
2003 and on the last calendar day of each three month period thereafter, or the
earlier termination of the Loan, Borrower shall pay to Bank a fee of one eighth
of one percent (.125%) per year on the average unused portion of the Loan for
the preceding quarter computed on the basis of actual days elapsed of a year of
360 days.

                  1.6      DOCUMENTATION FEE. On or before the date of execution
of this Agreement, Borrower shall pay to Bank a documentation fee of Five
Hundred Dollars ($500.00).

<PAGE>

                  1.7      BALANCES. Borrower shall maintain its major
depository accounts with Bank until the Note and all sums payable pursuant to
this Agreement have been paid in full.

                  1.8      DISBURSEMENT. Upon execution hereof, Bank shall
disburse the proceeds of the Loan as provided in Bank's standard form
Authorization executed by Borrower.

                  1.9      SECURITY. Prior to any disbursement of the Loan,
Borrower shall have executed a security agreement, on Bank's standard form, and
a financing statement, suitable for filing in the office of the Secretary of
State of the State of Delaware and any other state designated by Bank, granting
to Bank a first priority security interest in such of Borrower's property as is
described in said security agreement. Exceptions to Bank's first priority, if
any, are permitted only as otherwise provided in this Agreement. At Bank's
request, Borrower will also obtain executed landlord's and mortgagee's waivers
on Bank's form covering all of Borrower's property located on leased or
encumbered real property.

                  1.10     CONTROLLING DOCUMENT. In the event of any
inconsistency between the terms of this Agreement and any Note or any of the
other Loan Documents, the terms of such Note or other Loan Documents will
prevail over the terms of this Agreement.

         SECTION  2. CONDITIONS PRECEDENT

         Bank shall not be obligated to disburse all or any portion of the
proceeds of the Loan unless at or prior to the time for the making of such
disbursement, the following conditions have been fulfilled to Bank's
satisfaction:

                  2.1      COMPLIANCE. Borrower shall have performed and
complied with all terms and conditions required by this Agreement to be
performed or complied with by it prior to or at the date of the making of such
disbursement and shall have executed and delivered to Bank the Note and other
documents deemed necessary by Bank.

                  2.2      BORROWING RESOLUTION. Borrower shall have provided
Bank with copies of resolutions duly adopted by the Board of Directors of
Borrower, authorizing this Agreement and the Loan Documents. Such resolutions
shall also designate the persons who are authorized to act on Borrower's behalf
in connection with this Agreement and to do the things required of Borrower
pursuant to this Agreement.

                  2.3      SUBORDINATION AGREEMENTS. Bank shall have received
such subordination agreements, in form and substance satisfactory to Bank, as
shall be necessary for Borrower to achieve and maintain compliance with the
provisions of Section 5.7 hereof.

                  2.4      CONTINUING COMPLIANCE. At the time any disbursement
is to be made, there shall not exist any event, condition or act which
constitutes an event of default under Section 6 hereof or any event, condition
or act which with notice, lapse of time or both would constitute such event of
default; nor shall there be any such event, condition, or act immediately after
the disbursement were it to be made.

         SECTION  3. REPRESENTATIONS AND WARRANTIES

         Borrower represents and warrants that:

                  3.1      BUSINESS ACTIVITY. The principal business of Borrower
is the analysis and design of systems for national defense programs.

                                      -2-

<PAGE>

                  3.2      AFFILIATES AND SUBSIDIARIES. Borrower's affiliates
and subsidiaries (those entities in which Borrower has either a controlling
interest or at least a 25% ownership interest) and their addresses, and the
names of Borrower's principal shareholders, are as provided on a schedule
delivered to Bank on or before the date of this Agreement.

                  3.3      AUTHORITY TO BORROW. The execution, delivery and
performance of this Agreement, the Note and all other agreements and instruments
required by Bank in connection with the Loan are not in contravention of any of
the terms of any indenture, agreement or undertaking to which Borrower is a
party or by which it or any of its property is bound or affected.

                  3.4      FINANCIAL STATEMENTS. The financial statements of
Borrower, including both a balance sheet at December 31, 2002, together with
supporting schedules, and an income statement for the twelve (12) months ended
December 31, 2002 have heretofore been furnished to Bank, and are true and
complete and fairly represent the financial condition of Borrower during the
period covered thereby. Since December 31, 2002, there has been no material
adverse change in the financial condition or operations of Borrower.

                  3.5      TITLE. Except for assets which may have been disposed
of in the ordinary course of business, Borrower has good and marketable title to
all of the property reflected in its financial statements delivered to Bank and
to all property acquired by Borrower since the date of said financial
statements, free and clear of all liens, encumbrances, security interests and
adverse claims except those specifically referred to in said financial
statements.

                  3.6      LITIGATION. There is no litigation or proceeding
pending or threatened against Borrower or any of its property which is
reasonably likely to affect the financial condition, property or business of
Borrower in a materially adverse manner or result in liability in excess of
Borrower's insurance coverage.

                  3.7      DEFAULT. Borrower is not now in default in the
payment of any of its material obligations, and there exists no event, condition
or act which constitutes an event of default under Section 6 hereof and no
condition, event or act which with notice or lapse of time, or both, would
constitute an event of default.

                  3.8      ORGANIZATION. Borrower is duly organized and existing
under the laws of the state of its organization, and has the power and authority
to carry on the business in which it is engaged and/or proposes to engage.

                  3.9      POWER. Borrower has the power and authority to enter
into this Agreement and to execute and deliver the Note and all of the other
Loan Documents.

                  3.10     AUTHORIZATION. This Agreement and all things required
by this Agreement have been duly authorized by all requisite action of Borrower.

                  3.11     QUALIFICATION. Borrower is duly qualified and in good
standing in any jurisdiction where such qualification is required.

                  3.12     COMPLIANCE WITH LAWS. Borrower is not in violation
with respect to any applicable laws, rules, ordinances or regulations which
materially affect the operations or financial condition of Borrower.

                  3.13     ERISA. Any defined benefit pension plans as defined
in the Employee Retirement Income Security Act of 1974, as amended ("ERISA"), of
Borrower meet, as of the date hereof, the minimum funding standards of Section
302 of ERISA, and no Reportable Event or Prohibited Transaction as defined in
ERISA has occurred with respect to any such plan.

                  3.14     REGULATION U. No action has been taken or is
currently planned by Borrower, or any agent acting on its behalf, which would
cause this Agreement or the Note to violate Regulation U or any other regulation
of the Board of Governors of the Federal Reserve

                                      -3-

<PAGE>

System or to violate the Securities and Exchange Act of 1934, in each case as in
effect now or as the same may hereafter be in effect. Borrower is not engaged in
the business of extending credit for the purpose of purchasing or carrying
margin stock as one of its important activities and none of the proceeds of the
Loan will be used directly or indirectly for such purpose.

                  3.15     CONTINUING REPRESENTATIONS. These representations
shall be considered to have been made again at and as of the date of each
disbursement of the Loan and shall be true and correct as of such date or dates.

         SECTION  4. AFFIRMATIVE COVENANTS

         Until the Note and all sums payable pursuant to this Agreement or any
other of the Loan Documents have been paid in full, unless Bank waives
compliance in writing, Borrower agrees that:

                  4.1      USE OF PROCEEDS. Borrower will use the proceeds of
the Loan only as provided in subsection 1.3 above.

                  4.2      PAYMENT OF OBLIGATIONS. Borrower will pay and
discharge promptly all taxes, assessments and other governmental charges and
claims levied or imposed upon it or its property, or any part thereof, provided,
however, that Borrower shall have the right in good faith to contest any such
taxes, assessments, charges or claims and, pending the outcome of such contest,
to delay or refuse payment thereof provided that adequately funded reserves are
established by it to pay and discharge any such taxes, assessments, charges and
claims.

                  4.3      MAINTENANCE OF EXISTENCE. Borrower will maintain and
preserve its existence and assets and all rights, franchises, licenses and other
authority necessary for the conduct of its business and will maintain and
preserve its property, equipment and facilities in good order, condition and
repair. Bank may, at reasonable times, visit and inspect any of the properties
of Borrower.

                  4.4      RECORDS. Borrower will keep and maintain full and
accurate accounts and records of its operations according to generally accepted
accounting principles and will permit Bank to have access thereto, to make
examination and photocopies thereof, and to make audits during regular business
hours. Costs for such audits shall be paid by Borrower.

4.5      INFORMATION FURNISHED. Borrower will furnish to Bank:

                           (a)      Within sixty (60) days after the close of
each fiscal quarter, except for the final quarter of each fiscal year, its
unaudited balance sheet as of the close of such fiscal quarter, its unaudited
income and expense statement with supportive schedules and statement of retained
earnings for that fiscal quarter, prepared in accordance with generally accepted
accounting principles;

                           (b)      Within one hundred and twenty (120) days
after the close of each fiscal year, a copy of its statement of financial
condition including at least its balance sheet as of the close of such fiscal
year, its income and expense statement and retained earnings statement for such
fiscal year, examined and prepared on an audited basis by independent certified
public accountants selected by Borrower and reasonably satisfactory to Bank, in
accordance with generally accepted accounting principles applied on a basis
consistent with that of the previous year;

                           (c)      As soon as available, copies of such
financial statements and reports as Borrower may file with any state or federal
agency;

                           (d)      Such other financial statements and
information as Bank may reasonably request from time to time;

                                      -4-

<PAGE>

                           (e)      In connection with each fiscal year-end
statement required hereunder, any management letter of Borrower's certified
public accountants;

                           (f)      Prompt written notice to Bank of all events
of default under any of the terms or provisions of this Agreement or of any
other agreement, contract, document or instrument entered, or to be entered into
with Bank; and of any litigation which, if decided adversely to Borrower, would
have a material adverse effect on Borrower's financial condition; and of any
other matter which has resulted in, or is likely to result in, a material
adverse change in its financial condition or operations; and

                           (g)      Prior written notice to Bank of any changes
in Borrower's officers and other senior management; Borrower's name; and
location of Borrower's assets, principal place of business or chief executive
office.

                  4.6      CURRENT RATIO. Borrower will at all times maintain a
ratio of current assets to current liabilities of at least 1.25:1.0, as such
terms are defined by generally accepted accounting principles except that, for
the purposes of this calculation, any amounts borrower under the Revolving Loan
shall be considered a current liability.

                  4.7      TANGIBLE NET WORTH. Borrower will at all times
maintain Tangible Net Worth of not less than Thirty Three Million Dollars
($33,000,000). "Tangible Net Worth" shall mean net worth increased by
indebtedness of Borrower subordinated to Bank and decreased by patents,
licenses, trademarks, trade names, goodwill and other similar intangible assets,
organizational expenses, and monies due from affiliates (including officers,
shareholders and directors).

                  4.8      DEBT TO TANGIBLE NET WORTH. Borrower will at all
times maintain a ratio of total liabilities to tangible net worth of not greater
than 2.00:1.00. "Tangible Net Worth" shall mean net worth increased by
indebtedness of Borrower subordinated to Bank and decreased by patents,
licenses, trademarks, trade names, goodwill and other similar intangible assets,
organizational expenses, and monies due from affiliates (including officers,
shareholders and directors).

                  4.9      FIXED CHARGE COVERAGE RATIO. Borrower will maintain a
ratio of EBITDAR to Debt Service of not less than 1.50:1.0 as of the close of
each fiscal quarter. "EBITDAR" means earnings before interest, taxes, rent,
depreciation, amortization and other non-cash expense including stock based
compensation for the 12 months immediately preceding the date of calculation.
"Debt Service" means the sum of the principal portion of term obligations which
came due during the twelve (12) months preceding the date of calculation plus
interest expense plus rent expense made during the twelve (12) months preceding
the date of calculation.

                  4.10     INSURANCE. Borrower will keep all of its insurable
property, real, personal or mixed, insured by good and responsible companies
against fire and such other risks as are customarily insured against by
companies conducting similar business with respect to like properties. Borrower
will maintain adequate worker's compensation insurance and adequate insurance
against liability for damages to persons and property.

                  4.11     ADDITIONAL REQUIREMENTS. Borrower will promptly, upon
demand by Bank, take such further action and execute all such additional
documents and instruments in connection with this Agreement as Bank in its
reasonable discretion deems necessary, and promptly supply Bank with such other
information concerning its affairs as Bank may request from time to time.

                  4.12     LITIGATION AND ATTORNEYS' FEES. Borrower will pay
promptly to Bank upon demand, reasonable attorneys' fees (including but not
limited to the reasonable estimate of the allocated costs and expenses of
in-house legal counsel and legal staff) and all costs and other expenses paid or
incurred by Bank in collecting, modifying or compromising the Loan or in
enforcing or exercising its rights or remedies created by, connected with or
provided for in this

                                      -5-

<PAGE>

Agreement or any of the Loan Documents, whether or not an arbitration, judicial
action or other proceeding is commenced. If such proceeding is commenced, only
the prevailing party shall be entitled to attorneys' fees and court costs.

                  4.13     BANK EXPENSES. Borrower will pay or reimburse Bank
for all costs, expenses and fees incurred by Bank in preparing and documenting
this Agreement and the Loan, and all amendments and modifications thereof,
including but not limited to all filing and recording fees, costs of appraisals,
insurance and attorneys' fees, including the reasonable estimate of the
allocated costs and expenses of in-house legal counsel and legal staff.

                  4.14     REPORTS UNDER PENSION PLANS. Borrower will furnish to
Bank, as soon as possible and in any event within 15 days after Borrower knows
or has reason to know that any event or condition with respect to any defined
benefit pension plans of Borrower described in Section 3 above has occurred, a
statement of an authorized officer of Borrower describing such event or
condition and the action, if any, which Borrower proposes to take with respect
thereto.

         SECTION  5. NEGATIVE COVENANTS

         Until the Note and all other sums payable pursuant to this Agreement or
any other of the Loan Documents have been paid in full, unless Bank waives
compliance in writing, Borrower agrees that:

                  5.1      ENCUMBRANCES AND LIENS. Borrower will not create,
assume or suffer to exist any mortgage, pledge, security interest, encumbrance,
or lien (other than for taxes not delinquent and for taxes and other items being
contested in good faith) on property of any kind, whether real, personal or
mixed, now owned or hereafter acquired, or upon the income or profits thereof,
except to Bank and except for minor encumbrances and easements on real property
which do not affect its market value, and except for existing liens on
Borrower's personal property and future purchase money security interests
encumbering only the personal property purchased.

                  5.2      BORROWINGS. Borrower will not sell, discount or
otherwise transfer any account receivable or any note, draft or other evidence
of indebtedness, except to Bank or except to a financial institution at face
value for deposit or collection purposes only and without any fee other than
fees normally charged by the financial institution for deposit or collection
services. Borrower will not borrow any money, become contingently liable to
borrow money, nor enter any agreement to directly or indirectly obtain borrowed
money, except (a) pursuant to agreements made with Bank, and (b) indebtedness
incurred for the purpose of purchasing stock from current or former employees
provided, however, that payments arising from such obligations do not exceed
Borrower's quarterly stock repurchase limitation.

                  5.3      SALE OF ASSETS, LIQUIDATION OR MERGER. Borrower will
neither liquidate nor dissolve nor enter into any consolidation, merger,
partnership or other combination, nor convey, nor sell, nor lease all or the
greater part of its assets or business, nor purchase or lease all or the greater
part of the assets or business of another in excess of $2,000,000 without Bank's
written consent.

                  5.4      LOANS, ADVANCES AND GUARANTIES. Borrower will not,
except in the ordinary course of business as currently conducted, make any loans
or advances, become a guarantor or surety, pledge its credit or properties in
any manner or extend credit, except as allowed by Borrower's Stock Option Plan
or loans extended to current employees not to exceed Twenty Thousand Dollars
($20,000) per employee.

                  5.5      INVESTMENTS. Borrower will not purchase the debt or
equity of another person or entity except for savings accounts and certificates
of deposit of Bank, direct U.S. Government obligations and commercial paper
issued by corporations with the top ratings of Moody's or Standard & Poor's,
provided all such permitted investments shall mature within one year of
purchase.

                                      -6-

<PAGE>

                  5.6      PAYMENT OF DIVIDENDS. Borrower will not declare or
pay any dividends, other than a dividend payable in its own common stock, or
authorize or make any other distribution with respect to any of its stock now or
hereafter outstanding.

                  5.7      SUBORDINATION OF CERTAIN INDEBTEDNESS. Not at any
time permit the aggregate principal amount outstanding under all promissory
notes issued by Borrower to all former employees of Borrower and other persons
in full or partial consideration for Borrower's repurchase of shares of stock in
Borrower from such former employees and other persons to exceed Four Million
Dollars ($4,000,000) unless all such amounts in excess of Four Million Dollars
($4,000,000) are subordinated to all obligations now or hereafter owed by
Borrower to Bank pursuant to subordination agreements in form and substance
satisfactory to Bank. Bank hereby acknowledges and agrees, however, that each of
such subordination agreements shall permit Borrower to make, and shall permit
the payee of the promissory note(s) subordinated thereby to receive, regularly
scheduled payments of principal and interest under such promissory note(s) so
long as Borrower has made each and every payment of principal and interest due
and owing to Bank and is not in default under any of its agreements with Bank.

         SECTION  6. EVENTS OF DEFAULT

         The occurrence of any of the following events ("Events of Default")
shall terminate any obligation on the part of Bank to make or continue the Loan
and automatically, unless otherwise provided under the Note, shall make all sums
of interest and principal and any other amounts owing under the Loan immediately
due and payable, without notice of default, presentment or demand for payment,
protest or notice of nonpayment or dishonor, or any other notices or demands:

                  6.1      Borrower shall default in the due and punctual
payment of the principal of or the interest on the Note or any of the other Loan
Documents; or

                  6.2      Any default shall occur under the Note; or

                  6.3      Borrower shall default in the due performance or
observance of any covenant or condition of the Loan Documents; or

                  6.4      Any guaranty or subordination agreement required
hereunder is breached or becomes ineffective, or subordinating creditor dies,
disavows or attempts to revoke or terminate such guaranty or subordination
agreement; or

                  6.5      There is a change in ownership or control of ten
percent (10%) or more of the issued and outstanding stock of Borrower.

         SECTION  7. MISCELLANEOUS PROVISIONS

                  7.1      ADDITIONAL REMEDIES. The rights, powers and remedies
given to Bank hereunder shall be cumulative and not alternative and shall be in
addition to all rights, powers and remedies given to Bank by law against
Borrower or any other person, including but not limited to Bank's rights of
setoff or banker's lien.

                  7.2      NONWAIVER. Any forbearance or failure or delay by
Bank in exercising any right, power or remedy hereunder shall not be deemed a
waiver thereof and any single or partial exercise of any right, power or remedy
shall not preclude the further exercise thereof. No waiver shall be effective
unless it is in writing and signed by an officer of Bank.

                  7.3      INUREMENT. The benefits of this Agreement shall inure
to the successors and assigns of Bank and the permitted successors and assignees
of Borrower, and any assignment by Borrower without Bank's consent shall be null
and void.

                                      -7-

<PAGE>

                  7.4      APPLICABLE LAW. This Agreement and all other
agreements and instruments required by Bank in connection therewith shall be
governed by and construed according to the laws of the State of California.

                  7.5      SEVERABILITY. Should any one or more provisions of
this Agreement be determined to be illegal or unenforceable, all other
provisions nevertheless shall be effective. In the event of any conflict between
the provisions of this Agreement and the provisions of any note or reimbursement
agreement evidencing any indebtedness hereunder, the provisions of such note or
reimbursement agreement shall prevail.

                  7.6      INTEGRATION CLAUSE. Except for documents and
instruments specifically referenced herein, this Agreement constitutes the
entire agreement between Bank and Borrower regarding the Loan and all prior
communications verbal or written between Borrower and Bank shall be of no
further effect or evidentiary value.

                  7.7      CONSTRUCTION. The section and subsection headings
herein are for convenience of reference only and shall not limit or otherwise
affect the meaning hereof.

                  7.8      AMENDMENTS. This Agreement may be amended only in
writing signed by all parties hereto.

                  7.9      COUNTERPARTS. Borrower and Bank may execute one or
more counterparts to this Agreement, each of which shall be deemed an original,
but when together shall be one and the same instrument.

                                      -8-

<PAGE>

         SECTION  8. SERVICE OF NOTICES

                  8.1      Any notices or other communications provided for or
allowed hereunder shall be effective only when given by one of the following
methods and addressed to the respective party at its address given with the
signatures at the end of this Agreement and shall be considered to have been
validly given: (a) upon delivery, if delivered personally; (b) upon receipt, if
mailed, first class postage prepaid, with the United States Postal Service; (c)
on the next business day, if sent by overnight courier service of recognized
standing; and (d) upon telephoned confirmation of receipt, if telecopied.

                  8.2      The addresses to which notices or demands are to be
given may be changed from time to time by notice delivered as provided above.

         THIS AGREEMENT is executed on behalf of the parties by duly authorized
officers as of the date first above written.

UNION BANK OF CALIFORNIA, N.A.                         SPARTA, INC.

By:    /s/ Jim Heim                          By:    /s/ Robert C. Sepucha
       --------------                               ---------------------
Name:  Jim Heim                              Name:  Robert C. Sepucha
Title: Vice President                        Title: President

                                             By:    /s/ David E. Schreiman
                                                    ----------------------
Address:    18300 Von Karman                 Name:  David E. Schreiman
            Suite 310                        Title: Vice President
            Irvine, CA  92612
                                             Address:    1911 N. Fort Myer Dr.
Attention:  Jim Heim,VP                                  Suite 1100
Telecopier: (949) 553-6851                               Arlington, VA  22209
Telephone:  (949) 553-7122
                                             Attention:  David E. Schreiman, CFO
                                             Telecopier: (703) 558-0036
                                             Telephone:  (703) 558-0046

                                      -9-

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