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                                                                    EXHIBIT 10.2


                            PAYLESS SHOESOURCE, INC.

                      EXECUTIVE INCENTIVE COMPENSATION PLAN

                              FOR ANNUAL AWARDS FOR

                  MERCHANDISING AND RETAIL OPERATIONS FUNCTIONS

                             Effective May 28, 1999




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                            PAYLESS SHOESOURCE, INC.
                      EXECUTIVE INCENTIVE COMPENSATION PLAN
                              FOR ANNUAL AWARDS FOR
                  MERCHANDISING AND RETAIL OPERATIONS FUNCTIONS

        This document constitutes and sets forth the terms of the Payless
ShoeSource, Inc. Executive Incentive Compensation Plan for Annual Awards for
Merchandising and Retail Operations Functions.

Section 1.      PURPOSES OF THE PLAN. The purposes of the Plan are (i) to
provide a means to attract, retain and motivate talented personnel and (ii) to
provide to participating management employees added incentive for high levels of
performance and for additional effort to improve the financial performance of
the Company.

Section 2.      DEFINITIONS. Whenever used herein, the following terms shall
have the following meanings:

        a.      "Annual Award" means, for each Participant, for a Fiscal Year,
        the product of the Participant's Minimum Annual Compensation for such
        Fiscal Year multiplied by the aggregate of the applicable set of
        factors listed in i to x below, as assigned to the Participant by the
        Committee:



                i.      Category Gross Margin Rate Factor for such Fiscal Year



                ii.     Category Inventory Turnover Factor for such Fiscal Year

                iii.    Category Sales Factor for such Fiscal Year

                iv.     Company Gross Margin Rate Factor for such Fiscal Year

                v.      Company Sales Factor for such Fiscal Year

                vi.     Payless Gross Margin Rate Factor for such Fiscal Year

                vii.    Payless Inventory Turnover Factor for such Fiscal Year

                viii.   Payless Return on Sales Percentage Factor for such
                        Fiscal Year

                ix.     Payless Sales Factor for such Fiscal Year

                x.      PSSI Gross Margin Contribution Factor for such Fiscal
                        Year.

         b.     "Base Percent" means for each Participant and each applicable
                Factor, the percentage set by the Committee.

         c.     "Category Gross Margin Rate Factor" means, for a Participant for
         a Fiscal Year (i) zero percent, if actual Category Gross Margin Rate,
         for the relevant category, for such Fiscal Year is less than the
         Participant's Threshold Annual Category Gross Margin Rate Objective,
         (ii) the Base Percent, if actual Category Gross Margin Rate, for the
         relevant category, for such Fiscal Year equals or exceeds the
         Participant's Threshold Annual Category Gross Margin Rate Objective
         plus (iii) the Target Percent multiplied by a fraction (not less than
         zero and not greater than one), the numerator of which is the actual
         Category Gross Margin Rate, for the relevant category, for such Fiscal
         Year less the Threshold Annual Category Gross Margin Rate Objective and
         the denominator of which is the Participant's Maximum Annual Category
         Gross Margin Rate Objective less the Threshold Annual Category Gross
         Margin Rate Objective; provided, however, that the percentages referred
         to in this Section 2(c) may be adjusted by the Committee as provided in
         Section 4(b).




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         d.    "Category Inventory Turnover Factor" means, for a Participant for
         a Fiscal Year (i) zero percent, if actual Category Inventory Turnover,
         for the relevant category, for such Fiscal Year is less than the
         Participant's Threshold Annual Category Inventory Turnover Objective,
         (ii) the Base Percent, if actual Category Inventory Turnover, for the
         relevant category, for such Fiscal Year equals or exceeds the
         Participant's Threshold Annual Category Inventory Turnover Objective
         plus (iii) the Target Percent multiplied by a fraction (not less than
         zero and not greater than one), the numerator of which is the actual
         Category Inventory Turnover, for the relevant category, for such Fiscal
         Year less the Threshold Annual Category Inventory Turnover Objective
         and the denominator of which is the Participant's Maximum Annual
         Category Inventory Turnover Objective less the Threshold Annual
         Category Inventory Turnover Objective; provided, however, that the
         percentages referred to in this Section 2(d) may be adjusted by the
         Committee as provided in Section 4(b).

         e.    "Category Sales Factor" means, for a Participant for a Fiscal
         Year (i) zero percent, if actual Category Sales, for the relevant
         category, for such Fiscal Year is less than the Participant's Threshold
         Annual Category Sales Objective, (ii) the Base Percent, if actual
         Category Sales, for the relevant category, for such Fiscal Year equals
         or exceeds the Participant's Threshold Annual Category Sales Objective
         plus (iii) the Target Percent multiplied by a fraction (not less than
         zero and not greater than one), the numerator of which is the actual
         Category Sales, for the relevant category, for such Fiscal Year less
         the Threshold Annual Category Sales Objective and the denominator of
         which is the Participant's Maximum Annual Category Sales Objective less
         the Threshold Annual Category Sales Objective; provided, however, that
         the percentages referred to in this Section 2(e) may be adjusted by the
         Committee as provided in Section 4(b).

         f.    "Company Gross Margin Rate Factor" means, for a Participant for a
         Fiscal Year (i) zero percent, if actual Company Gross Margin Rate, for
         the relevant company, for such Fiscal Year is less than the
         Participant's Threshold Annual Company Gross Margin Rate Objective,
         (ii) the Base Percent, if actual Company Gross Margin Rate, for the
         relevant company, for such Fiscal Year equals or exceeds the
         Participant's Threshold Annual Company Gross Margin Rate Objective plus
         (iii) the Target Percent multiplied by a fraction (not less than zero
         and not greater than one), the numerator of which is the actual Company
         Gross Margin Rate, for the relevant company, for such Fiscal Year less
         the Threshold Annual Company Gross Margin Rate Objective and the
         denominator of which is the Participant's Maximum Annual Company Gross
         Margin Rate Objective less the Threshold Annual Company Gross Margin
         Rate Objective; provided, however, that the percentages referred to in
         this Section 2(f) may be adjusted by the Committee as provided in
         Section 4(b).

         g.    "Company Sales Factor" means, for a Participant for a Fiscal Year
         (i) zero percent, if actual Company Sales, for the relevant company,
         for such Fiscal Year is less than the Participant's Threshold Annual
         Company Sales Objective, (ii) the Base Percent, if actual Company Sales
         , for the relevant company, for such Fiscal Year equals or exceeds the
         Participant's Threshold Annual Company Sales Objective plus (iii) the
         Target Percent multiplied by a fraction (not less than zero and not
         greater than one), the numerator of which is the actual Company Sales,
         for the relevant company, for such Fiscal Year less the Threshold
         Annual Company Sales Objective and the denominator of which is the
         Participant's Maximum Annual Company Sales Objective less the Threshold
         Annual Company Sales Objective; provided, however, that the percentages
         referred to in this Section 2(g) may be adjusted by the Committee as
         provided in Section 4(b).

         h.    "Payless Gross Margin Rate Factor" means, for a Participant for a
         Fiscal Year (i) zero percent, if actual Payless Gross Margin Rate for
         such Fiscal Year is less than the Participant's Threshold Annual
         Payless Gross Margin Rate Objective, (ii) the Base Percent, if actual
         Payless Gross Margin Rate for such Fiscal Year equals or exceeds the
         Participant's Threshold Annual Payless Gross Margin Rate plus (iii) the
         Target Percent multiplied by a fraction (not less than zero and not
         greater than one), the numerator of which is the actual Payless Gross
         Margin Rate for such Fiscal Year less the Threshold Annual Payless
         Gross Margin Rate Objective and the denominator of which is the
         Participant's Maximum Annual Payless




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         Gross Margin Rate Objective less the Threshold Annual Payless Gross
         Margin Objective; provided, however, that the percentages referred to
         in this Section 2(h) may be adjusted by the Committee as provided in
         Section 4(b).

         i."Payless Inventory Turnover Factor" means, for a Participant for a
         Fiscal Year (i) zero percent, if actual Payless Inventory Turnover for
         such Fiscal Year is less than the Participant's Threshold Annual
         Payless Inventory Turnover Objective, (ii) the Base Percent, if actual
         Payless Inventory Turnover for such Fiscal Year equals or exceeds the
         Participant's Threshold Annual Payless Inventory Turnover Objective
         plus (iii) the Target Percent multiplied by a fraction (not less than
         zero and not greater than one), the numerator of which is the actual
         Payless Inventory Turnover for such Fiscal Year less the Threshold
         Annual Payless Inventory Turnover Objective and the denominator of
         which is the Participant's Maximum Annual Payless Inventory Turnover
         Objective less the Threshold Annual Payless Inventory Turnover
         Objective; provided, however, that the percentages referred to in this
         Section 2(i) may be adjusted by the Committee as provided in Section
         4(b).

         j.    "Payless Return on Sales Percentage Factor" means, for a
         Participant for a Fiscal Year (i) zero percent, if actual Payless
         Return on Sales Percentage for such Fiscal Year is less than the
         Participant's Threshold Annual Payless Return on Sales Percentage
         Objective, (ii) the Base Percent, if actual Payless Return on Sales
         Percentage for such Fiscal Year equals or exceeds the Participant's
         Threshold Annual Payless Return on Sales Percentage Objective plus
         (iii) the Target Percent multiplied by a fraction (not less than zero
         and not greater than one), the numerator of which is the actual Payless
         Return on Sales Percentage for such Fiscal Year less the Threshold
         Annual Payless Return on Sales Percentage Objective and the denominator
         of which is the Participant's Maximum Annual Payless Return on Sales
         Percentage Objective less the Threshold Annual Payless Return on Sales
         Percentage Objective; provided, however, that the percentages referred
         to in this Section 2 (j) may be adjusted by the Committee as provided
         in Section 4(b).

         k.    "Payless Sales Factor" means, for a Participant for a Fiscal Year
         (i) zero percent, if actual Payless Sales for such Fiscal Year is less
         than the Participant's Threshold Annual Payless Sales Objective, (ii)
         the Base Percent, if actual Payless Sales for such Fiscal Year equals
         or exceeds the Participant's Threshold Annual Payless Sales Objective
         plus (iii) the Target Percent multiplied by a fraction (not less than
         zero and not greater than one), the numerator of which is the actual
         Payless Sales for such Fiscal Year less the Threshold Annual Payless
         Sales Objective and the denominator of which is the Participant's
         Maximum Annual Payless Sales Objective less the Threshold Annual
         Payless Sales Objective; provided, however, that the percentages
         referred to in this Section 2(k) may be adjusted by the Committee as
         provided in Section 4(b).

         l.    "PSSI Gross Margin Contribution Factor" means, for a Participant
         for a Fiscal Year (i) zero percent, if actual PSSI Gross Margin
         Contribution for such Fiscal Year is less than the Participant's
         Threshold Annual PSSI Gross Margin Contribution Objective, (ii) the
         Base Percent, if actual PSSI Gross Margin Contribution for such Fiscal
         Year equals or exceeds the Participant's Threshold Annual PSSI Gross
         Margin Contribution Objective plus (iii) the Target Percent multiplied
         by a fraction (not less than zero and not greater than one), the
         numerator of which is the actual PSSI Gross Margin Contribution for
         such Fiscal Year less the Threshold Annual PSSI Gross Margin
         Contribution Objective and the denominator of which is the
         Participant's Maximum Annual PSSI Gross Margin Contribution Objective
         less the Threshold PSSI Gross Margin Contribution Objective; provided,
         however, that the percentages referred to in this Section 2(l) may be
         adjusted by the Committee as provided in Section 4(b).

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

         n.    "Committee" means the Compensation and Nominating Committee of
         the Board; provided, however, the Compensation and Nominating Committee
         of the Board may delegate its powers under this


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         Plan, except for its powers specified in Section 12, to a management
         committee ("Management Committee") comprised of the Chief Executive
         Officer, the President and such other management personnel as the Chief
         Executive Officer and the President may designate from time to time,
         none of whom shall be eligible to participate in the Plan, in which
         case the term "Committee" with respect to such Sections shall be deemed
         to refer to the Management Committee.

         o.    "Company" means Payless ShoeSource, Inc., a Delaware corporation.

         p.    "Disability" means the inability of a Participant to perform the
         normal duties of the Participant's regular occupation.

         q.    "Fiscal Year" means the fiscal year of the Company.

         r.    "Minimum Annual Compensation" means, for a Fiscal Year, (i) the
         Participant's minimum annual salary rate as of November 1 of such
         Fiscal Year or (ii) if a Participant is designated as such as of a date
         after November 1 in such Fiscal Year, the Participant's minimum annual
         salary rate as of such date; provided that if the Committee determines
         that such compensation rate does not adequately reflect such
         Participant's minimum annual salary rate for such Fiscal Year or if the
         Fiscal Year does not contain a November 1 (as in a short year), then
         the term shall mean the salary rate determined by the Committee in its
         absolute discretion; provided further, that upon the written agreement
         of the Participant and the Company, the term shall mean such lesser
         amount as is agreed to by the parties.

         s.    "Target Percent" means for each Participant and each applicable
         Factor, the maximum percentage of Minimum Annual Compensation that can
         be earned with respect to each factor as set by the Committee less the
         Base Percent.

         t.    "Participant" means an individual who has been designated to
         participate in the Plan in accordance with Section 3 of the Plan.

         u.    "Plan" mean the Payless ShoeSource, Inc. Executive Incentive
         Compensation Plan for Annual Awards for Merchandising and Retail
         Operations Functions.

         v.    "Retirement" means, as to a Participant, retirement as that word
         is defined in the Company's Profit Sharing Plan (or comparable plan of
         a Subsidiary applicable to a Participant).

         w.    "Subsidiary" means a subsidiary corporation of the Company within
         the meaning of Section 425(f) of the Internal Revenue Code.

         x.    The terms "Maximum Annual Category Gross Margin Rate Objective,"
         "Threshold Annual Category Gross Margin Rate Objective," "Maximum
         Annual Category Inventory Turnover Objective," "Threshold Annual
         Category Inventory Turnover Objective," "Maximum Annual Category Sales
         Objective," "Threshold Annual Category Sales Objective," "Maximum
         Annual Company Gross Margin Rate Objective," "Threshold Annual Company
         Gross Margin Rate Objective," "Maximum Annual Company Sales Objective,"
         "Threshold Annual Company Sales Objective," "Maximum Annual Payless
         Gross Margin Rate Objective," "Threshold Annual Payless Gross Margin
         Rate Objective," "Maximum Annual Payless Inventory Turnover Objective,"
         "Threshold Annual Payless Inventory Turnover Objective," "Maximum
         Annual Payless Return on Sales Percentage Objective," "Threshold Annual
         Payless Return on Sales Percentage Objective," "Maximum Annual Payless
         Sales Objective," "Threshold Annual Payless Sales Objective," "Maximum
         Annual PSSI Gross Margin Contribution Objective" and "Threshold Annual
         PSSI Gross Margin Contribution Objective" shall mean the respective
         objectives determined by the Committee for each Participant pursuant to
         Section 6 of the Plan.



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         y.    The terms "Category Gross Margin Rate," "Category Inventory
         Turnover," "Category Sales," "Company Gross Margin Rate," "Company
         Sales," "Payless Gross Margin Rate," "Payless Inventory Turnover,"
         "Payless Return on Sales Percentage," "Payless Sales" and "PSSI Gross
         Margin Contribution" shall have the meaning ascribed to them in such
         report(s) as the Company's management generally relies upon; provided,
         however, that in the event any of these terms identify data which is
         disclosed by the Company to the Securities Exchange Commission or the
         New York Stock Exchange, the definition of such data, as disclosed,
         shall be the meaning of the term.

Section 3.     ELIGIBILITY. Management employees of the Company and its
Subsidiaries who are in the merchandising and retail operations functions of the
Company shall be eligible to participate in the Plan. The Committee may, in its
sole discretion, designate any such individual as a Participant for a particular
Fiscal Year before the end of such Fiscal Year. Designation of an individual as
a Participant for any period shall not require designation of such individual as
a Participant in any other period, and designation of one individual as a
Participant shall not require designation of any other individual as a
Participant in such period or in any other period.

Section 4.     ANNUAL AWARD.

         a.    Subject to the other provisions of the Plan, a Participant for a
         Fiscal Year who is designated as such for an entire Fiscal Year shall
         be entitled to an Annual Award for such Fiscal Year. Subject to the
         other provisions of the Plan, a Participant for a Fiscal Year who is
         designated as such for less than an entire Fiscal Year shall be
         entitled to a reduced Annual Award for such Fiscal Year equal to the
         Annual Award for such Fiscal Year multiplied by a fraction, the
         numerator of which shall be the number of complete fiscal months
         between (i) the first day of the fiscal month in which occurs the date
         as of which the Participant was so designated and (ii) the end of such
         Fiscal Year and the denominator of which shall be twelve.

         b.    The Committee may change the percentages referred to in the
         definitions of "Category Gross Margin Rate Factor," "Category Inventory
         Turnover Factor," "Category Sales Factor," "Company Gross Margin Rate
         Factor," "Company Sales Factor," "Payless Gross Margin Rate Factor,"
         "Payless Inventory Turnover Factor," "Payless Return on Sales
         Percentage Factor," "Payless Sales Factor" and "PSSI Gross Margin
         Contribution Factor" for any Fiscal Year, provided that the maximum
         Annual Award which may be paid under such different percentage may not
         be greater than 45 percent of the relevant Participant's Minimum Annual
         Compensation for such Fiscal Year.

Section 5.     DISCRETIONARY ADJUSTMENT OF AWARDS.In the event that the
Committee determines, in its absolute discretion, that an Annual Award payable
to a Participant in accordance with the other terms of the Plan should be
adjusted, upwards or downwards, based on all the facts and circumstances known
to the Committee at the time, then, at any time prior to the closing of the
Company's books for a Fiscal Year, the Committee may, in its sole and absolute
discretion, increase or decrease any such Annual Award (for such Fiscal Year) to
such amount as it determines.

Section 6.     ANNUAL TARGETS. For each Fiscal Year, (i) threshold, target and
maximum annual objectives, (ii) the Base Percent, and (iii) the Target Percent
with respect to Category Gross Margin Rate, Category Inventory Turnover,
Category Sales, Company Gross Margin Rate, Company Sales, Payless Gross Margin
Rate, Payless Inventory Turnover, Payless Return on Sales Percentage, Payless
Sales and PSSI Gross Margin Contribution, as applicable, shall be determined by
the Committee as soon as practicable after the commencement of such Fiscal Year
for each Participant. The Committee shall cause the respective objectives for
each Participant to be provided to such Participant as soon thereafter as
practicable. Such objectives shall remain in effect for the entire Fiscal Year,
unless the Committee determines, in its absolute discretion, that such
objectives should be modified.



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Section 7.     PAYMENT OF AWARDS.

        a.     Annual Awards for a Fiscal Year shall be payable in cash within
        three months after the close of such Fiscal Year or as soon thereafter
        as practicable.

        b.     A Participant may elect to defer all or a portion of an award
        under the Payless ShoeSource, Inc. Deferred Compensation Plan.

        c.     The Company shall have the right to deduct any sums that federal,
        state or local tax laws require to be withheld with respect to any
        payment of awards.

Section 8.     TERMINATION OF EMPLOYMENT.

        a.     Death, Disability or Retirement. In the event of death or
        disability of the Participant while employed and Retirement of the
        Participant (each a "Section 8(a) Event"), the Participant shall be
        entitled to an Annual Award with respect to the Fiscal Year in which the
        Section 8(a) Event occurs equal to the Annual Award otherwise payable
        (if any) for that Fiscal Year, prorated to the end of the fiscal month
        in which such Section 8(a) Event occurs.

        b.     Termination of Employment other than Section 8(a).

               i.   In the event of the termination of employment of the
               Participant not covered by Section 8(a) above which occurs at
               the end of the term of the Participant's then-current written
               employment agreement (if any) with the Company or Subsidiary,
               or in the event of such a termination of a Participant who has
               no current written employment agreement with the Company or
               Subsidiary, such event shall be deemed to be a Section 8(a)
               Event, and the Participant shall be entitled to an Annual
               Award as provided in Section 8(a).

               ii.  In the event of the termination of employment of the
               Participant not covered by Section 8(a) above before the end of
               the term of the Participant's then-current written employment
               agreement (if any) with the Company or Subsidiary, with the
               written consent of the Company (a "Section 8(b)(ii) Event"), the
               Participant shall be entitled to an Annual Award with respect to
               the Fiscal Year in which the Section 8(b)(ii) Event occurs equal
               to the actual award otherwise payable for the Fiscal Year (if
               any); provided, however, that in the event that the term of the
               Participant's then-current employment agreement is due to expire
               during that Fiscal Year, then the Annual Award shall be prorated
               to the end of the fiscal month in which such term is due to
               expire.

               iii. In the event of the termination of employment of the
               Participant not otherwise covered by this Section 8 before the
               end of the term of the Participant's then-current written
               employment agreement (if any) with the Company or Subsidiary,
               without the written consent of the Company, the Participant shall
               not be entitled to any Annual Award with respect to any Fiscal
               Year which has not been completed as of the date of such
               termination of employment. The Participant shall forfeit any
               right or interest in any award for any such Fiscal Year. Annual
               Awards with respect to Fiscal Years which ended prior to the date
               of such termination of employment shall remain unaffected.

        c.     For purposes of this Section 8, the term "written consent of the
        Company" shall refer to an express written consent of the Company, duly
        executed by the Company, which, by its own terms, expressly refers to
        this Section 8 of the Plan.




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Section 9.     TRANSFERS AND CHANGES IN RESPONSIBILITIES.

        a.     In the event that (i) a Participant's responsibilities are
        changed or that a Participant is transferred from the Participant's
        then-current operating division of the Company or Subsidiary to another
        operating division of the Company or Subsidiary, and (ii) the
        Participant remains employed by the Company or by a Subsidiary following
        such change or transfer (a "Section 9 Event") and the Participant and
        the Company either agree that the Section 9 Event is of such a character
        that the Participant's participation in the Plan should cease as of the
        date of such Section 9 Event or fail to agree on whether such Section 9
        Event is of such a character, then any Annual Award to which the
        Participant would otherwise be entitled under the terms of the Plan
        shall be prorated to the date of such event.

         b.    In the event that a Section 9 Event occurs and the Participant
        and the Company agree that such change or transfer is of such a
        character that the Participant's participation should not cease as of
        the date of such change or transfer, then any Annual Award to which the
        Participant would be entitled under the terms of the Plan:

               i. with respect to the portion of the Fiscal Year before such
               event, shall be the pro rata portion of the Annual Award, if any,
               otherwise payable to such Participant based on the Participant's
               objectives and on the performance of the division, Subsidiary or
               operation for which the Participant was employed before such
               event, and

                ii. with respect to the portion of the Fiscal Year after such
               event, shall be the pro rata portion of the Annual Award, if any,
               otherwise payable to such Participant based on the Participant's
               objectives and on the performance of the division, Subsidiary or
               operation for which the Participant was employed after such
               event.

In the event that more than one such Section 9 Event shall occur in any one
Fiscal Year for any Participant, the Committee shall adjust any Annual Award in
such manner as the Committee shall determine, in its absolute discretion, to
reflect the purposes and intent of the Plan. Moreover, the Committee has the
right to adjust all awards pursuant to Section 5, in its absolute discretion,
which may be exercised in such a manner as the Committee deems fair and
equitable, based on the performance of the Participant while participating in
any other bonus or compensation plan of the Company.

Section 10.    RIGHTS OF PARTICIPANTS AND BENEFICIARIES.

        a.     Nothing contained in the Plan shall confer upon any Participant
        any right to continue in the employ of the Company or constitute any
        contract or agreement of employment or interfere in any way with the
        right of the Company to terminate or change the conditions of
        employment.

        b.     So long as the Participant is alive, the Company shall pay all
        amounts payable hereunder only to the Participant or his or her personal
        representatives. In the event of the death of a Participant, payments of
        all amounts otherwise due to the Participant under the Plan shall be
        made to the Participant's beneficiary at the time of death under the
        Company Paid Life Insurance Plan of Payless ShoeSource, Inc., if
        applicable, or to such other beneficiary as the Participant shall have
        designated, in writing, for purposes of this Plan on a form provided by
        the Company or, in the absence of a designation of beneficiary, to the
        Participant's estate.

        c.     Subject to the provisions of Section 10(d), rights to payments
        under the Plan shall not be subject in any manner to anticipation,
        alienation, sale, transfer, assignment, pledge, encumbrance, levy or
        charge, and any attempt to do so shall be void; nor shall any such
        amounts be in any manner liable for or subject to the debts, contracts,
        liabilities, engagements or torts of the Participant or his or her
        beneficiaries.


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        d.     Nothing in this Section 10 shall prohibit the personal
        representatives of a Participant from designating that any amount that
        would otherwise be distributed to the Participant's estate should be
        distributed in accordance with the terms of the Participant's last will
        and testament or pursuant to the laws of descent and distribution.

Section 11.    UNFUNDED CHARACTER OF THE PLAN. The right of a Participant to
receive any Annual Award hereunder shall be an unsecured claim against the
general assets of the Company. Nothing in the Plan shall require the Company to
invest any amounts in the common stock of the Company or in any other medium.

Section 12.    AMENDMENT OR TERMINATION. The Committee may, by resolution, amend
or terminate the Plan at any time provided, however, the Committee may not,
without the consent of the Participant, amend or terminate the Plan in such a
manner as to affect adversely any Annual Award which would have been payable,
based on the terms of the Plan immediately prior to any such amendment or
termination, for any Fiscal Year which has already commenced as of the effective
date of the amendment or termination.

Section 13.    INTERPRETATION.   Any interpretation of or dispute regarding the
meaning of any term hereof shall be as determined or resolved, as appropriate,
by the Committee in its absolute discretion.




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