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                                                          EXHIBIT 10(III) A10(a)

                        NATIONAL SERVICE INDUSTRIES, INC.

                           LONG-TERM INCENTIVE PROGRAM


         1.       Purpose. The purposes of the National Service Industries, Inc.
Long-Term Incentive Program (the "Program") are to provide additional incentives
to those officers and key employees of National Service Industries, Inc. (the
"Company") and its Subsidiaries (as hereinafter defined) whose substantial
contributions are essential to the continued growth and success of the Company's
business to strengthen their commitment to the Company and its Subsidiaries, to
motivate those officers and employees to perform their assigned responsibilities
faithfully and diligently and to attract and retain competent and dedicated
individuals whose efforts will result in the long-term growth and profitability
of the Company. To accomplish these purposes, the Program provides that the
Company may grant Incentive Stock Options, Nonqualified Stock Options, Stock
Appreciation Rights, Restricted Stock, Performance Units and Performance Shares
(as each term is hereinafter defined).

         2.       Definitions. For purposes of the Program:

                  (a)      "Adjusted Fair Market Value" means, in the event of a
         Change in Control, the greater of (1) the highest price per Share paid
         to holders of the Shares in any transaction (or series of transactions)
         constituting or resulting in a Change in Control or (ii) the highest
         Fair Market Value of a Share during the ninety (90) day period ending
         on the date of a Change in Control.

                  (b)      "Agreement" means the written agreement between the
         Company and an Optionee or Grantee evidencing the grant of an Option or
         Award and setting forth the terms and conditions thereof.

                  (c)      "Award" means a grant of Restricted Stock, Stock
         Appreciation Rights, Performance Awards or any or all of them.

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

                  (e)      "Change in Capitalization" means any increase or
         reduction in the number of Shares, or any change (including, but not
         limited to, a change in value) or exchange of Shares for a different
         number or kind of shares or other securities of the Company, by reason
         of a reclassification, recapitalization, merger, consolidation,
         reorganization, spin-off, split-up, issuance of warrants or rights or
         debentures, stock dividend, stock split or reverse stock split, cash
         dividend, property dividend, combination or exchange of shares,
         repurchase of shares, public offering, private placement, change in
         corporate structure or otherwise, which in the judgment of the
         Committee is material or significant.

                  (f)      "Change in Control" means any of the following
         events:

                           (1)      The acquisition (other than from the
                  Company) by any "Person" (as the term is used for purposes of
                  Sections 13(d) or 14(d) of the Exchange Act) of beneficial
                  ownership (within the meaning of Rule 13d-3 promulgated under
                  the Exchange Act) of twenty percent (20%) or more of the
                  combined voting power of the Company's then outstanding voting
                  securities; or

                           (2)      The individuals who, as of September 21,
                  1989, are members of the Board (the "Incumbent Board"), cease
                  for any reason to constitute at least two-thirds of the Board,
                  provided, however, that if the election, or nomination for
                  election by the Company's stockholders, of any new director
                  was approved by a vote of at least two-thirds of the Incumbent
                  Board, such new director shall, for purposes of this
                  Agreement, be considered as a member of the Incumbent Board;
                  or

                           (3)      Approval by stockholders of the Company of
                  (i) a merger or consolidation involving the Company if the
                  stockholders of the Company, immediately before such merger or
                  consolidation do not, as a result of such merger or
                  consolidation, own, directly or indirectly, more than seventy
                  percent (70%) of the combined voting power of the then
                  outstanding voting securities of the corporation resulting
                  from such merger or consolidation in substantially the same
                  proportion as their ownership of the combined voting power of
                  the voting securities of the Company outstanding immediately
                  before such merger or consolidation or (ii) a complete
                  liquidation or dissolution of the Company or an agreement for
                  the sale or other disposition of all or substantially



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                  all of the assets of the Company.

         Notwithstanding the foregoing, a Change in Control shall not be deemed
         to occur pursuant to Section 2(f)(1), solely because twenty percent
         (20%) or more of the combined voting power of the Company's then
         outstanding securities is acquired by (i) a trustee or other fiduciary
         holding securities under one or more employee benefit plans maintained
         by the Company or any of its subsidiaries or (ii) any corporation
         which, immediately prior to such acquisition, is owned directly or
         indirectly by the stockholders of the Company in the same proportion as
         their ownership of stock in the Company immediately prior to such
         acquisition.

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

                  (h)      "Committee" means a committee consisting of at least
         three (3) Disinterested Persons appointed by the Board to administer
         the Program and to perform the functions set forth herein.

                  (i)      "Company" means National Service Industries, Inc.

                  (j)      "Disability" means a physical or mental infirmity
         which impairs the Optionee's or Grantee's ability to substantially
         perform his duties for a period of one hundred eighty (180) consecutive
         days.

                  (k)      "Disinterested Person" means a disinterested
         administrator with respect to the Company or any Subsidiary as
         described in Rule 16b-3(d)(3) under the Exchange Act.

                  (1)      "Division" means any of the operating units or
         divisions of the Company designated as a Division by the Committee.

                  (m)      "Eligible Employee" means any officer or other
         designated employees of the Company or a Subsidiary designated by the
         Committee as eligible to receive Options or Awards subject to the
         conditions set forth herein.

                  (n)      "Exchange Act" means the Securities Exchange Act of
         1984, as amended.

                  (o)      "Fair Market Value" means the fair market value of
         the Shares as determined in good faith by the Committee; provided,
         however, that (A) if the Shares are admitted to trading on a national
         securities exchange, Fair Market Value on any date shall be the last
         sale price reported for the Shares on such exchange on such date or, if
         no sale was reported on such date, on the last date preceding such date
         on which a sale was reported, (B) if the Shares are admitted to
         quotation on the National Association of Securities Dealers Automated
         Quotation System ("NASDAQ") or other comparable quotation system and
         have been designated as a National Market System ("NMS") security, Fair
         Market Value on any date shall be the last sale price reported for the
         Shares on such system on such date or on the last day preceding such
         date on which a sale was reported, or (C) if the Shares are admitted to
         quotation on NASDAQ and have not been designated a NMS security, Fair
         Market Value on any date shall be the average of the highest bid and
         lowest asked prices of the Shares on such system on such date.

                  (p)      "Good Objective" means a challenging and above
         average level of performance of the Company, a Subsidiary or a Division
         during a Performance Cycle for which a Performance Award is granted, as
         determined by the Committee at the time such Performance Award is
         granted.

                  (q)      "Grantee" means a person to whom an Award has been
         granted under the Program.

                  (r)      "Incentive Stock Option" means an Option within the
         meaning of Section 422A of the Code.

                  (s)      "Maximum Realistic Objective" means an excellent
         level of performance of the Company, a Subsidiary or a Division during
         a Performance Cycle for which a Performance Award is granted, as
         determined by the Committee at the time such Performance Award is
         granted.

                  (t)      "Minimum Acceptable Objective" means a minimum level
         of performance of the Company, a Subsidiary or a Division during a
         Performance Cycle for which a Performance Award is granted, as
         determined by the Committee at the time such Performance Award is
         granted.

                  (u)      "Nonqualified Stock Option" means an Option which is
         not an Incentive Stock Option.

                  (v)      "Option" means an Incentive Stock Option, a
         Nonqualified Stock Option, or either or both of them.



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                  (w)      "Optionee" means a person to whom an Option has been
         granted under the Program.

                  (x)      "Performance Awards" means Performance Units,
         Performance Shares or either or both of them.

                  (y)      "Performance Cycle" means the time period specified
         by the Committee at the time a Performance Award is granted during
         which the performance of the Company, a Subsidiary or a Division will
         be measured, which period shall be at least two fiscal years.

                  (z)      "Performance Shares" means Restricted Stock granted
         under Section 9 of the Program.

                  (aa)     "Performance Unit" means Performance Units granted
         under Section 9 of the Program.

                  (bb)     "Restricted Stock" means Shares issued or transferred
         to an Eligible Employee which are subject to restrictions. Restricted
         Stock may be subject to restrictions which lapse over time without
         regard to the performance of the Company, a Subsidiary or a Division,
         pursuant to Section 8 hereof or may be awarded as Performance Shares
         pursuant to Section 9 hereof.

                  (cc)     "Retirement" means the voluntary termination of
         employment by the Grantee or Optionee at any time after the Grantee
         attains age 65.

                  (dd)     "Shares" means the common stock, par value $1.00 per
         share, of the Company (including any new, additional or different stock
         or securities resulting from a Change in Capitalization).

                  (ee)     "Stock Appreciation Right" means a right to receive
         all or some portion of the increase in the value of the Shares as
         provided in Section 7 hereof.

                  (ff)     "Subsidiary" means any corporation in an unbroken
         chain of corporations, beginning with the Company, if each of the
         corporations other than the last corporation in the unbroken chain owns
         stock possessing 50% or more of the total combined voting power of all
         classes of stock in one of the other corporations in such chain.

                  (gg)     "Successor Corporation" means a corporation, or a
         parent or subsidiary thereof within the meaning of Section 425(a) of
         the Code, which issues or assumes a stock option in a transaction to
         which Section 425(a) of the Code applies.

                  (hh)     "Ten-Percent Stockholder" means an Eligible Employee,
         who, at the time an Incentive Stock Option is to be granted to him,
         owns (within the meaning of Section 422A(b)(6) of the Code) stock
         possessing more than ten percent (10%) of the total combined voting
         power of all classes of stock of the Company, or of a parent or a
         subsidiary within the meaning of Section 422A(b)(6) of the Code.

         3.       Administration.

                  (a)      The Program shall be administered by the Committee
         which shall hold meetings at such times as may be necessary for the
         proper administration of the Program. The Committee shall keep minutes
         of its meetings. A quorum shall consist of not less than three members
         of the Committee and a majority of a quorum may authorize any action.
         Each member of the Committee shall be a Disinterested Person. No member
         of the Committee shall be personally liable for any action,
         determination or interpretation made in good faith with respect to the
         Program, Agreements, Options or Awards, and all members of the
         Committee shall be fully indemnified by the Company with respect to any
         such action, determination or interpretation.

                  (b)      Subject to the express terms and conditions set forth
         herein, the Committee or the Board shall have the power from time to
         time

                           (1)      to determine those Eligible Employees to
                  whom Options shall be granted under the Program and the number
                  of Incentive Stock Options and/or Nonqualified Stock Options
                  to be granted to each Eligible Employee and to prescribe the
                  terms and conditions (which need not be identical) of each
                  Option, including the purchase price per Share subject to each
                  Option, and make any amendment or modification to any
                  Agreement consistent with the terms of the Program;



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                           (2)      to select those Eligible Employees to whom
                  Awards shall be granted under the Program and to determine the
                  number of Performance Units, Performance Shares, Shares of
                  Restricted Stock, and/or Stock Appreciation Rights to be
                  granted pursuant to each Award, the terms and conditions of
                  each Award, including the restrictions or performance criteria
                  relating to such Units, Shares or Rights, the maximum value of
                  each Performance Unit and Performance Share and whether Stock
                  Appreciation Rights will be granted alone, or in conjunction
                  with or related to an Option, and make any amendment or
                  modification to any Agreement consistent with the terms of the
                  Program;

                  (c)      Subject to the express terms and conditions set forth
         herein, the Committee shall have the power from time to time:

                           (1)      to construe and interpret the Program and
                  the Options and Awards granted thereunder and to establish,
                  amend and revoke rules and regulations for the administration
                  of the Program, including, but not limited to, correcting any
                  defect or supplying any omission, or reconciling any
                  inconsistency in the Program or in any Agreement, in the
                  manner and to the extent it shall deem necessary or advisable
                  to make the Program fully effective, and all decisions and
                  determinations by the Committee in the exercise of this power
                  shall be final, binding and conclusive upon the Company, a
                  Subsidiary, and the Optionees and Grantees, as the case may
                  be;

                           (2)      to determine the duration and purposes for
                  leaves of absence which may be granted to an Optionee or
                  Grantee on an individual basis without constituting a
                  termination of employment or service for purposes of the
                  Program;

                           (3)      to exercise its discretion with respect to
                  the powers and rights granted to it as set forth in the
                  Program;

                           (4)      generally, to exercise such powers and to
                  perform such acts as are deemed necessary or advisable to
                  promote the best interests of the Company with respect to the
                  Program; and

         provided however, that the Committee may delegate to senior members of
         the management of the Company the right to exercise those powers
         described in Sections (b)(1) and (2) with respect to Eligible Employees
         who are not employed in the Company's corporate headquarters (and staff
         vice presidents and assistant officers).

         4.       Stock Subject to Program.

                  (a)      The maximum number of Shares that may be issued or
         transferred pursuant to Options and Awards under the Program is
         1,750,000 Shares (or the number and kind of shares of stock or other
         securities to which such Shares are adjusted upon a Change in
         Capitalization pursuant to Section 11) and the Company shall reserve
         for the purposes of the Program, out of its authorized but unissued
         Shares or out of Shares held in the Company's treasury, or partly out
         of each, such number of Shares as shall be determined by the Board.

                  (b)      Not more than fifteen percent (15%) of the Shares
         referred to in Section 4(a) may be issued or transferred in connection
         with Awards of Restricted Stock made pursuant to Section 8 (other than
         Awards of Performance Shares pursuant to Section 9).

                  (c)      Whenever any outstanding Option or Award or portion
         thereof expires, is cancelled or is otherwise terminated for any reason
         (other than by exercise of the Option or any Stock Appreciation Right),
         the Shares allocable to the cancelled or otherwise terminated portion
         of such Option or Award may again be the subject of Options and Awards
         hereunder.

                  (d)      Whenever any Shares subject to an Award or Option are
         forfeited for any reason pursuant to the terms of the Program, such
         Shares may again be the subject of Options and Awards hereunder.

         5.       Eligibility. Subject to the provisions of the Program, the
Committee shall have full and final authority to select those Eligible Employees
who will receive Options and/or Awards provided, however, that no Eligible
Employee shall receive any Incentive Stock Options unless he is an employee of
the Company, a parent or a subsidiary (within the meaning of Section 422A of the
Code) at the time the Incentive Stock Option is granted.



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         6.       Options. The Committee may grant Options in accordance with
the Program and the terms and conditions of the Option shall be set forth in an
Agreement. Each Option and Agreement shall be subject to the following
conditions:

                  (a)      Purchase Price. The purchase price or the manner in
         which the purchase price is to be determined for Shares under each
         Option shall be set forth in the Agreement, provided that the purchase
         price per Share under each Option shall not be less than 100% of the
         Fair Market Value of a Share at the time the Option is granted (110% in
         the case of an Incentive Stock Option granted to a Ten-Percent
         Stockholder).

                  (b)      Duration. Options granted hereunder shall be for such
         term as the Committee shall determine, provided that no Option shall be
         exercisable after the expiration of ten (10) years from the date it is
         granted (five (5) years in the case of an Incentive Stock Option
         granted to a Ten-Percent Stockholder). The Committee may, subsequent to
         the granting of any Option, extend the term thereof but in no event
         shall the term as so extended exceed the maximum term provided for in
         the preceding sentence.

                  (c)      Non-transferability. No Option granted hereunder
         shall be transferable by the Optionee to whom granted otherwise than by
         will or the laws of descent and distribution, and an Option may be
         exercised during the lifetime of such Optionee only by the Optionee or
         his guardian or legal representative. The terms of such Option shall be
         final, binding and conclusive upon the beneficiaries, executors,
         administrators, heirs and successors of the Optionee.

                  (d)      Vesting. Subject to Section 6(i) hereof, each Option
         shall be exercisable in such installments (which need not be equal) and
         at such times as may be designated by the Committee and set forth in
         the Agreement. To the extent not exercised, installments shall
         accumulate and be exercisable, in whole or in part, at any time after
         becoming exercisable, but not later than the date the Option expires.
         The Committee may accelerate the exercisability of any Option or
         portion thereof at any time.

                  (e)      Method of Exercise. The exercise of an Option shall
         be made only by a written notice delivered in person or by mail to the
         Secretary of the Company at the Company's principal executive office,
         specifying the number of Shares to be purchased and accompanied by
         payment therefor and otherwise in accordance with the Agreement
         pursuant to which the Option was granted. The purchase price for any
         Shares purchased pursuant to the exercise of an Option shall be paid in
         full upon such exercise, as determined by the Committee in its
         discretion, in cash, by check, or by transferring Shares to the Company
         upon such terms and conditions as determined by the Committee. The
         written notice pursuant to this Section 6(e) may also provide
         instructions from the Optionee to the Company that upon receipt of the
         purchase price in cash from the Optionee's broker or dealer, designated
         as such on the written notice, in payment for any Shares purchased
         pursuant to the exercise of an Option, the Company shall issue such
         Shares directly to the designated broker or dealer. Any Shares
         transferred to the Company as payment of the purchase price under an
         Option shall be valued at their Fair Market Value on the day preceding
         the date of exercise of such Option. If requested by the Committee, the
         Optionee shall deliver the Agreement evidencing the Option and the
         Agreement evidencing any related Stock Appreciation Right to the
         Secretary of the Company who shall endorse thereon a notation of such
         exercise and return such Agreement to the Optionee. No fractional
         Shares shall be issued upon exercise of an Option and the number of
         Shares that may be purchased upon exercise shall be rounded to the
         nearest number of whole Shares.

                  (f)      Rights of Optionees. No Optionee shall be deemed for
         any purpose to be the owner of any Shares subject to any Option unless
         and until (i) the Option shall have been exercised pursuant to the
         terms thereof, (ii) the Company shall have issued and delivered the
         Shares to the Optionee and (iii) the Optionee's name shall have been
         entered as a stockholder of record on the books of the Company.
         Thereupon, the Optionee shall have full voting, dividend and other
         ownership rights with respect to such Shares.

                  (g)      Termination of Employment. The Agreement shall set
         forth the terms and conditions of the Option upon the termination of
         the Optionee's employment with the Company, Subsidiary or a Division
         (including a Grantee's ceasing to be employed by a Subsidiary or
         Division as a result of the sale of such Subsidiary or Division or an
         interest in such Subsidiary or Division) as the Committee may, in its
         discretion, determine at the time the Option is granted or thereafter;
         provided, however, that no Option shall be exercisable beyond its
         maximum term as described in Section 6(b) hereof.



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                  (h)      Modification or Substitution. Subject to the terms of
         the Program, the Committee may, in its discretion, modify outstanding
         Options or accept the surrender of outstanding Options (to the extent
         not exercised) and grant new Options in substitution for them.
         Notwithstanding the foregoing, no modification of an Option shall
         adversely alter or impair any rights or obligations under the Agreement
         without the Optionee's consent.

                  (i)      Effect of Change in Control. Notwithstanding anything
         contained in the Program or an Agreement to the contrary, in the event
         of a Change in Control, (i) all Options outstanding on the date of such
         Change in Control shall become immediately and fully exercisable and
         (ii) an Optionee will be permitted to surrender for cancellation within
         sixty (60) days after such Change in Control, any Option or portion of
         an Option to the extent not yet exercised and the Optionee will be
         entitled to receive a cash payment in an amount equal to the excess, if
         any, of (x) (A) except as described in clause (B) below, the greater of
         (1) the Fair Market Value, on the date preceding the date of surrender,
         of the Shares subject to the Option or portion thereof surrendered or
         (2) the Adjusted Fair Market Value of the Shares subject to the Option
         or portion thereof surrendered or (B) in the case of an Incentive Stock
         Option, the Fair Market Value, at the time of surrender, of the Shares
         subject to the Option or portion thereof surrendered, over (y) the
         aggregate purchase price for such Shares under the Option; provided,
         however, that in the case of an Option granted within six (6) months
         prior to the Change in Control to any Optionee who may be subject to
         liability under Section 16(b) of the Exchange Act, such Optionee shall
         be entitled to surrender for cancellation his or her Option during the
         sixty (60) day period commencing upon the expiration of six (6) months
         from the date of grant of any such Option.

         7.       Stock Appreciation Rights. The Committee may, in its
discretion, either alone or in connection with the grant of an Option, grant
Stock Appreciation Rights in accordance with the Program and the terms and
conditions of which shall be set forth in an Agreement. If granted in connection
with an Option, a Stock Appreciation Right shall cover the same Shares covered
by the Option (or such lesser number of Shares as the Committee may determine)
and shall, except as provided in this Section 7, be subject to the same terms
and conditions as the related Option.

                  (a)      Time of Grant. A Stock Appreciation Right may be
         granted (i) at any time if unrelated to an Option, or (ii) if related
         to an Option, either at the time of grant, or at any time thereafter
         during the term of the Option.

                  (b)      Stock Appreciation Right Related to an Option.

                           (1)      Payment. A Stock Appreciation Right granted
                  in connection with an Option shall entitle the holder thereof,
                  upon exercise of the Stock Appreciation Right or any portion
                  thereof, to receive payment of an amount computed pursuant to
                  Section 7(b)(3).

                           (2)      Exercise. Subject to Section 7(f), a Stock
                  Appreciation Right granted in connection with an Option shall
                  be exercisable at such time or times and only to the extent
                  that the related Option is exercisable, and will not be
                  transferable except to the extent the related Option may be
                  transferable. A Stock Appreciation Right granted in connection
                  with an Incentive Stock Option shall be exercisable only if
                  the Fair Market Value of a Share on the date of exercise
                  exceeds the purchase price specified in the related Incentive
                  Stock Option Agreement.

                           (3)      Amount Payable. Except as otherwise provided
                  in Section 7(i), upon the exercise of a Stock Appreciation
                  Right related to an Option, the Grantee shall be entitled to
                  receive an amount determined by multiplying (A) the excess of
                  the Fair Market Value of a Share on the date of exercise of
                  such Stock Appreciation Right over the per Share purchase
                  price under the related Option, by (B) the number of Shares as
                  to which such Stock Appreciation Right is being exercised.
                  Notwithstanding the foregoing, the Committee may limit in any
                  manner the amount payable with respect to any Stock
                  Appreciation Right by including such a limit in the Agreement
                  evidencing the Stock Appreciation Right at the time it is
                  granted.

                           (4)      Treatment of Related Options and Stock
                  Appreciation Rights Upon Exercise. Upon the exercise of a
                  Stock Appreciation Right granted in connection with an Option,
                  the Option shall be cancelled to the extent of the number of
                  Shares as to which the Stock Appreciation Right is exercised,
                  and upon the exercise of an Option granted in connection with
                  a Stock Appreciation



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                  Right or the surrender of such Option pursuant to Section
                  6(i), the Stock Appreciation Right shall be cancelled to the
                  extent of the number of Shares as to which the Option is
                  exercised or surrendered.

                  (c)      Stock Appreciation Right Unrelated to an Option. The
         Committee may grant to Eligible Employees Stock Appreciation Rights
         unrelated to Options. Stock Appreciation Rights unrelated to Options
         shall contain such terms and conditions as to exercisability (subject
         to Section 7(f)), vesting and duration as the Committee shall
         determine, but in no event shall they have a term of greater than ten
         (10) years. The amount payable upon exercise of a Stock Appreciation
         Right shall be determined in accordance with Section 7(b)(3) or 7(i),
         as the case may be, except that "Fair Market Value of a Share on the
         date of the grant of the Stock Appreciation Right" shall be substituted
         in clause (A) of Section 7(b)(3) for "purchase price under the related
         Option."

                  (d)      Method of Exercise. Stock Appreciation Rights shall
         be exercised by a Grantee only by a written notice delivered in person
         or by mail to the Secretary of the Company at the Company's principal
         executive office, specifying the number of Shares with respect to which
         the Stock Appreciation Right is being exercised. If requested by the
         Committee, the Grantee shall deliver the Agreement evidencing the Stock
         Appreciation Right being exercised and the Agreement evidencing any
         related Option to the Secretary of the Company who shall endorse
         thereon a notation of such exercise and return such Agreement to the
         Grantee.

                  (e)      Form of Payment. Payment of the amount determined
         under Sections 7(b)(3) or 7(c) may be made in the discretion of the
         Committee, solely in whole Shares in a number determined at their Fair
         Market Value on the date preceding the date of exercise of the Stock
         Appreciation Right, or solely in cash, or in a combination of cash and
         Shares. If the Committee decides to make full payment in Shares and the
         amount payable results in a fractional Share, payment for the
         fractional Share will be made in cash. Notwithstanding the foregoing,
         no payment in the form of cash may be made upon the exercise of a Stock
         Appreciation Right pursuant to Sections 7(b)(3) or 7(c) to an officer
         of the Company or a Subsidiary who is subject to liability under
         Section 16(b) of the Exchange Act, unless the exercise of such Stock
         Appreciation Right is made during the period beginning on the third
         business day and ending on the twelfth business day following the date
         of release for publication of the Company's quarterly or annual
         statements of earnings.

                  (f)      Restrictions. No Stock Appreciation Right may be
         exercised before the date six (6) months after the date it is granted,
         except in the event that the death or Disability of the Grantee occurs
         before the expiration of the six-month period.

                  (g)      Termination of Employment. The Agreement shall set
         forth the terms and conditions of the Award upon the termination of the
         Grantee's employment with the Company, Subsidiary or a Division
         (including a Grantee's ceasing to be employed by a Subsidiary or
         Division as a result of the sale of such Subsidiary or Division or an
         interest in such Subsidiary or Division) as the Committee may, in its
         discretion, determine at the time the Stock Appreciation Right is
         granted or thereafter.

                  (h)      Modification or Substitution. Subject to the terms of
         the Program, the Committee may modify outstanding Awards of Stock
         Appreciation Rights or accept the surrender of outstanding Awards of
         Stock Appreciation Rights (to the extent not exercised) and grant new
         Awards in substitution for them. Notwithstanding the foregoing, no
         modification of an Award shall adversely alter or impair any rights or
         obligations under the Agreement without the Grantee's consent.

                  (i)      Effect of Change in Control. Notwithstanding anything
         contained in this Program to the contrary, in the event of a Change in
         Control, subject to Section 7(f), all Stock Appreciation Rights shall
         become immediately and fully exercisable. Notwithstanding Sections
         7(b)(3), 7(c) and 7(e), upon the exercise of a Stock Appreciation Right
         or any portion thereof during the sixty (60) day period following a
         Change in Control, the amount payable shall be in cash and shall be
         determined by reference to (A) except as provided in clause (B) below,
         the greater of (x) the Fair Market Value of the Shares on the date
         preceding the date of such exercise and (y) the Adjusted Fair Market
         Value of the Shares on the date of such exercise or (B) in the case of
         a Stock Appreciation Right related to an Incentive Stock Option, the
         Fair Market Value of the Shares on the date of such exercise; provided,
         however, that in the case of a Stock Appreciation Right granted within
         six (6) months prior to the Change in Control to any Grantee who may be
         subject to liability under Section 16(b) of the Exchange Act, such
         Grantee shall be entitled to exercise



                                      -7-
<PAGE>



         his Stock Appreciation Right during the sixty (60) day period
         commencing upon the expiration of six (6) months from the date of grant
         of any such Stock Appreciation Right.

         8.       Restricted Stock. The Committee may grant Awards of Restricted
Stock, and may issue Shares of Restricted Stock in payment in respect of vested
Performance Units (as hereinafter provided in Section 9(b)), which shall be
evidenced by an Agreement between the Company and the Grantee. Each Agreement
shall contain such restrictions, terms and conditions as the Committee may, in
its discretion, determine and (without limiting the generality of the foregoing)
such Agreements may require that an appropriate legend be placed on Share
certificates. Awards of Restricted Stock shall be subject to the following terms
and provisions:

                  (a)      Rights of Grantee. Shares of Restricted Stock granted
         pursuant to an Award hereunder shall be issued in the name of the
         Grantee as soon as reasonably practicable after the Award is granted
         provided that the Grantee has executed an Agreement evidencing the
         Award, the appropriate blank stock powers and, in the discretion of the
         Committee, an escrow agreement and any other documents which the
         Committee may require as a condition to the issuance of such Shares. If
         a Grantee shall fail to execute the Agreement evidencing a Restricted
         Stock Award, the appropriate blank stock powers and, in the discretion
         of the Committee, an escrow agreement and any other documents which the
         Committee may require within the time period prescribed by the
         Committee at the time the Award is granted, the Award shall be null and
         void. At the discretion of the Committee, Shares issued in connection
         with a Restricted Stock Award shall be deposited together with the
         stock powers with an escrow agent designated by the Committee. Unless
         the Committee determines otherwise and as set forth in the Agreement,
         upon delivery of the Shares to the escrow agent, the Grantee shall have
         all of the rights of a stockholder with respect to such Shares,
         including the right to vote the Shares and to receive all dividends or
         other distributions paid or made with respect to the Shares.

                  (b)      Non-transferability. Until any restrictions upon the
         Shares of Restricted Stock awarded to a Grantee shall have lapsed in
         the manner set forth in Section 8(c), such Shares shall not be sold,
         transferred or otherwise disposed of and shall not be pledged or
         otherwise hypothecated, nor shall they be delivered to the Grantee.

                  (c)      Lapse of Restrictions.

                           (1)      Generally. Restrictions upon Shares of
                  Restricted Stock awarded hereunder shall lapse at such time or
                  times and on such terms and conditions as the Committee may
                  determine.

                           (2)      Effect of Change in Control. Notwithstanding
                  anything contained in the Program to the contrary, in the
                  event of a Change in Control, all restrictions upon any Shares
                  of Restricted Stock (other than Performance Shares) shall
                  lapse immediately and all such Shares shall become fully
                  vested in the Grantee.

                  (d)      Termination of Employment. The Agreement shall set
         forth the terms and conditions of the Award of Shares of Restricted
         Stock upon the termination of the Grantee's employment with the
         Company, a Subsidiary or a Division (including a Grantee's ceasing to
         be employed by a Subsidiary or Division as a result of the sale of such
         Subsidiary or Division or an interest in such Subsidiary or Division)
         as the Committee may, in its discretion, determine at the time the
         Award is granted or thereafter.

                  (e)      Modification or Substitution. Subject to the terms of
         the Program, the Committee may modify outstanding Awards of Restricted
         Stock or accept the surrender of outstanding Awards of Restricted Stock
         (to the extent not exercised) and grant new Awards in substitution for
         them. Notwithstanding the foregoing, no modification of an Award shall
         adversely alter or impair any rights or obligations under the Agreement
         without the Grantee's consent.

                  (f)      Treatment of Dividends. At the time the Award of
         Shares of Restricted Stock is granted, the Committee may, in its
         discretion, determine that the payment to the Grantee of dividends, or
         a specified portion thereof, declared or paid on such Shares by the
         Company shall be (i) deferred until the lapsing of the restrictions
         imposed upon such Shares and (ii) held by the Company for the account
         of the Grantee until such time. In the event of such deferral, there
         shall be credited at the end of each year (or portion thereof) interest
         on the amount of the account at the beginning of the year at a rate per
         annum as the Committee, in its discretion, may determine. Payment of
         deferred dividends, together with interest accrued thereon, shall



                                      -8-
<PAGE>


         be made upon the lapsing of restrictions imposed on such Shares, and
         any dividends deferred (together with any interest accrued thereon) in
         respect of any Shares of Restricted Stock shall be forfeited upon the
         forfeiture of such Shares pursuant to Section 8(d) or otherwise.

                  (g)      Delivery of Shares. Upon the lapse of the
         restrictions on Shares of Restricted Stock, the Committee shall cause a
         stock certificate to be delivered to the Grantee with respect to such
         Shares, free of all restrictions hereunder.

         9.       Performance Awards.

                  (a)      Performance Objectives. Performance objectives for
         Performance Awards may be expressed in terms of (i) earnings per Share,
         (ii) pre-tax profits, (iii) net earnings or net worth, (iv) return on
         equity or assets, (v) any combination of the foregoing, or (vi) any
         other standard or standards deemed appropriate by the Committee at the
         time the Award is granted. Performance objectives may be in respect of
         the performance of the Company and its Subsidiaries (which may be on a
         consolidated basis), a Subsidiary or a Division. Performance objectives
         may be absolute or relative and may be expressed in terms of a
         progression within a specified range, with the Grantee becoming vested
         in (i) a minimum percentage of such Performance Awards in the event the
         Minimum Acceptable Objective is met or, if surpassed, a greater
         percentage (ii) an intermediate percentage of such Performance Awards
         in the event the Good Objective is met or, if surpassed, a greater
         percentage and (iii) one hundred percent (100%) of such Performance
         Awards in the event the Maximum Realistic Objective is met or
         surpassed. Prior to the end of a Performance Cycle, the Committee, in
         its discretion, may adjust the performance objectives to reflect a
         Change in the Capitalization, a change in the tax rate or book tax rate
         of the Company or any Subsidiary, or any other event which may
         materially affect the performance of the Company, a Subsidiary or a
         Division, including, but not limited to, market conditions or a
         significant acquisition or disposition of assets or other property by
         the Company, a Subsidiary or a Division.

                  (b)      Performance Units. The Committee may grant
         Performance Units, the terms and conditions of which shall be set forth
         in an Agreement between the Company and the Grantee. Each Performance
         Unit shall, contingent upon the attainment of specified performance
         objectives within the Performance Cycle, represent one (1) Share. Each
         Agreement shall specify the number of the Performance Units to which it
         relates, the performance objectives which must be satisfied in order
         for the Performance Units to vest, the Performance Cycle within which
         such objectives must be satisfied, and the form of payment in respect
         of vested Performance Units.

                           (1)      Vesting and Forfeiture. A Grantee shall
         become vested with respect to the Performance Units to the extent that
         the performance objectives set forth in the Agreement are satisfied for
         the Performance Cycle. Subject to Section 9(d) hereof, if the Minimum
         Acceptable Objective specified in the Agreement is not satisfied for
         the applicable Performance Cycle, the Grantee's rights with respect to
         the Performance Shares shall be forfeited.

                           (2)      Payment of Awards. Payment of Performance
         Units to Grantees in respect of vested Performance Units shall be made
         within sixty (60) days after the last day of the Performance Cycle to
         which such Award relates. Subject to Section 9(d), such payments may be
         made entirely in Shares, entirely in cash, or in such combination of
         Shares and cash as the Committee in its discretion, shall determine at
         any time prior to such payment; provided, however, that if the
         Committee in its discretion determines to make such payment entirely or
         partially in Shares of Restricted Stock, the Committee must determine
         the extent to which such payment will be in Shares of Restricted Stock
         at the time the Award is granted. Except as provided in Section 9(d),
         if payment is made in the form of cash, the amount payable in respect
         of any Share shall be equal to the Fair Market Value of such Share on
         the last day of the Performance Cycle.

                           (3)      Termination of Employment. The Agreement
         shall set forth the terms and conditions of the Award of Performance
         Units upon the termination of the Grantee's employment with the
         Company, a Subsidiary, or a Division (including a Grantee's ceasing to
         be employed by a Subsidiary or Division as a result of the sale of such
         Subsidiary or Division or an interest in such Subsidiary or Division)
         as the Committee may, in its discretion, determine at the time the
         Award is granted or thereafter.



                                       -9-
<PAGE>



                  (c)      Performance Shares. The Committee, in its discretion,
         may grant Awards of Performance Shares and shall be evidenced by an
         Agreement between the Company and the Grantee. Each Agreement shall
         contain such restrictions, if any, and the terms and conditions as the
         Committee may, in its discretion, require, and (without limiting the
         generality of the foregoing) such Agreements may require that an
         appropriate legend be placed on Share certificates. Awards of
         Performance Shares shall be subject to the following terms and
         provisions:

                           (1)      Rights of Grantee. The Committee shall
                  provide at the time an Award of Performance Shares is made,
                  the time or times at which the Performance Shares granted
                  pursuant to such Award hereunder shall be issued in the name
                  of the Grantee; provided, however, that no Performance Shares
                  shall be issued until the Grantee has executed an Agreement
                  evidencing the Award, the appropriate blank stock powers and,
                  in the discretion of the Committee, an escrow agreement and
                  any other documents which the Committee may require as a
                  condition to the issuance of such Performance Shares. If a
                  Grantee shall fail to execute the Agreement evidencing an
                  Award of Performance Shares, the appropriate blank stock
                  powers and, in the discretion of the Committee, an escrow
                  agreement and any other documents which the Committee may
                  require within the time period prescribed by the Committee at
                  the time the Award is granted, the Award shall be null and
                  void. At the discretion of the Committee, Shares issued in
                  connection with an Award of Performance Shares shall be
                  deposited together with the stock powers with an escrow agent
                  designated by the Committee. Except as restricted by the terms
                  of the Agreement, upon delivery of the Shares to the escrow
                  agent, the Grantee shall have, in the discretion of the
                  Committee, all of the rights of a stockholder with respect to
                  such Shares, including the right to vote the shares and to
                  receive all dividends or other distributions paid or made with
                  respect to the shares.

                           (2)      Non-transferability. Until any restrictions
                  upon the Performance Shares awarded to a Grantee shall have
                  lapsed in the manner set forth in Sections 9(c)(3) or 9(d),
                  such Performance Shares shall not be sold, transferred or
                  otherwise disposed of and shall not be pledged or otherwise
                  hypothecated, nor shall they be delivered to the Grantee. The
                  Committee may also impose such other restrictions and
                  conditions on the Performance Shares, if any, as it deems
                  appropriate.

                           (3)      Lapse of Restrictions. Subject to Section
                  9(d), restrictions upon Performance Shares awarded hereunder
                  shall lapse and such Performance Shares shall become vested at
                  such time or times and on such terms, conditions and
                  satisfaction of performance objectives as the Committee may,
                  in its discretion, determine at the time an Award is granted.

                           (4)      Termination of Employment. The Agreement
                  shall set forth the terms and conditions of the Award of
                  Performance Shares upon the termination of the Grantee's
                  employment with the Company, a Subsidiary or a Division
                  (including a Grantee's ceasing to be employed by a Subsidiary
                  or Division as a result of the sale of such Subsidiary or
                  Division or an interest in such Subsidiary or Division) as the
                  Committee may, in its discretion, determine at the time the
                  Award is granted or thereafter.

                           (5)      Treatment of Dividends. At the time the
                  Award of Performance Shares is granted, the Committee may, in
                  its discretion, determine that the payment to the Grantee of
                  dividends, or a specified portion thereof, declared or paid on
                  Performance Shares issued by the Company to the Grantee shall
                  be (i) deferred until the lapsing of the restrictions imposed
                  upon such Performance Shares and (ii) held by the Company for
                  the account of the Grantee until such time. In the event of
                  such deferral, there shall be credited at the end of each year
                  (or portion thereof) interest on the amount of the account at
                  the beginning of the year at a rate per annum as the
                  Committee, in its discretion, may determine. Payment of
                  deferred dividends, together with interest accrued thereon as
                  aforesaid, shall be made upon the lapsing of restrictions
                  imposed on such Performance Shares, except that any dividends
                  deferred (together with any interest accrued thereon) in
                  respect of any Performance Shares shall be forfeited upon the
                  forfeiture of such Performance Shares pursuant to Section
                  9(c)(4) or otherwise.

                           (6)      Delivery of Shares. Upon the lapse of the
                  restrictions on Performance Shares awarded hereunder, the
                  Committee shall cause a stock certificate to be delivered to
                  the Grantee


                                      -10-
<PAGE>


                  with respect to such Shares, free of all restrictions
                  hereunder.

                  (d)      Effect of Change in Control. Notwithstanding anything
         contained in the Program to the contrary, in the event of a Change in
         Control:

                           (1)      With respect to the Performance Units, the
                  Grantee shall (i) become vested in a percentage of Performance
                  Units as determined by the Committee at the time of the Award
                  of such Performance Units and as set forth in the Agreement
                  and (ii) be entitled to receive in respect of all Performance
                  Units which become vested as a result of a Change in Control,
                  a cash payment within ten (10) days after such Change in
                  Control equal to the product of the Adjusted Fair Market Value
                  of a Share multiplied by the number of Performance Units which
                  become vested in accordance with this Section 9(d); and

                           (2)      With respect to the Performance Shares, all
                  restrictions shall lapse immediately on all or a portion of
                  the Performance Shares as determined by the Committee at the
                  time of the Award of such Performance Shares and as set forth
                  in the Agreement.

                  (e)      Non-transferability. No Performance Awards shall be
         transferable by the Grantee otherwise than by will or the laws of
         descent and distribution.

                  (f)      Modification or Substitution. Subject to the terms of
         the Program, the Committee may modify outstanding Performance Awards or
         accept the surrender of outstanding Performance Awards and grant new
         Performance Awards in substitution for them. Notwithstanding the
         foregoing, no modification of a Performance Award shall adversely alter
         or impair any rights or obligations under the Agreement without the
         Grantee's consent.

         10.      Loans.

                  (a)      The Company or any Subsidiary may make loans to a
         Grantee or Optionee in connection with the exercise of an Option,
         subject to the following terms and conditions and such other terms and
         conditions not inconsistent with the Program including the rate of
         interest, if any, as the Committee shall impose from time to time.

                  (b)      No loan made under the Program shall exceed the sum
         of (i) the aggregate purchase price payable pursuant to the Option with
         respect to which the loan is made, plus (ii) the amount of the
         reasonably estimated income taxes payable by the Optionee or Grantee
         with respect to the Option or Award. In no event may any such loan
         exceed the Fair Market Value, at the date of exercise, of any such
         Shares.

                  (c)      No loan shall have an initial term exceeding ten (10)
         years; provided, however, that loans under the Program shall be
         renewable at the discretion of the Committee.

                  (d)      Loans under the Program may be satisfied by an
         Optionee or Grantee, as determined by the Committee, in cash or, with
         the consent of the Committee, in whole or in part by the transfer to
         the Company of Shares whose Fair Market Value on the date of such
         payment is equal to the cash amount for which such Shares are
         transferred.

                  (e)      A loan shall be secured by a pledge of Shares with a
         Fair Market Value of not less than the principal amount of the loan.
         After partial repayment of a loan, pledged Shares no longer required as
         security may be released into escrow or pursuant to the terms of the
         Option, Award or escrow agreement to the Optionee or Grantee.

         11.      Adjustment Upon Changes in Capitalization.

                  (a)      In the event of a Change in Capitalization, the
         Committee shall conclusively determine the appropriate adjustments, if
         any, to the maximum number and class of Shares or other stock or
         securities with respect to which Options or Awards may be granted under
         the Program, the number and class of Shares or other stock or
         securities which are subject to outstanding Options or Awards granted
         under the Program, and the purchase price therefor, if applicable.

                  (b)      Any such adjustment in the Shares or other stock or
         securities subject to outstanding Incentive Stock Options (including
         any adjustments in the purchase price) shall be made in such manner as




                                      -11-
<PAGE>



         not to constitute a modification as defined by Section 425(h)(3) of the
         Code and only to the extent otherwise permitted by Sections 422A and
         425 of the Code.

                  (c)      If, by reason of a Change in Capitalization, a
         Grantee of an Award shall be entitled to, or an Optionee shall be
         entitled to exercise an Option with respect to, new, additional or
         different shares of stock, securities, Performance Units or Performance
         Shares (other than rights or warrants to purchase securities), such new
         additional or different shares shall thereupon be subject to all of the
         conditions, restrictions and performance criteria which were applicable
         to the Performance Units or Performance Shares pursuant to the Award or
         Shares subject to the Option, as the case may be, prior to such Change
         in Capitalization.

         12.      Effect of Certain Transactions. Subject to Sections 6(i),
7(i), 8(c)(2) and 9(d), in the event of (i) the liquidation or dissolution of
the Company or (ii) a merger or consolidation of the Company (a "Transaction"),
the Program and the Options and Awards issued hereunder shall continue in effect
in accordance with their respective terms and each Optionee and Grantee shall be
entitled to receive in respect of each Share subject to any outstanding Options
or Awards, as the case may be, upon exercise of any Option or Award or payment
or transfer in respect of any Award, the same number and kind of stock,
securities, cash, property, or other consideration that each holder of a Share
was entitled to receive in the Transaction in respect of a Share.

         13.      Release of Financial Information. A copy of the Company's
annual report to stockholders shall be delivered to each Optionee and Grantee at
the time such report is distributed to the Company's stockholders. Upon
reasonable request the Company shall furnish as soon as reasonably practicable,
to each Optionee and Grantee a copy of its most recent annual report and each
quarterly report and current report filed under the Exchange Act since the end
of the Company's prior fiscal year.

         14.      Termination and Amendment of the Program.

                  (a)      The Program shall terminate on the day preceding the
         tenth anniversary of its effective date and no Option or Award may be
         granted thereafter. The Board may sooner terminate or amend the Program
         (other than to reduce the rights of Optionees and Grantees, as the case
         may be, under Sections 6(i), 7(i), 8(c)(2) and 9(d)), at any time and
         from time to time; provided, however, that to the extent necessary
         under Section 16(b) of the Exchange Act and the rules and regulations
         promulgated thereunder, no amendment shall be effective unless approved
         by the stockholders of the Company in accordance with applicable law
         and regulations at an annual or special meeting held within twelve (12)
         months before or after the date of adoption of such amendment.

                  (b)      Except as provided in Sections 11 and 12 hereof,
         rights and obligations under any Option or Award granted before any
         amendment of the Program shall not be adversely altered or impaired by
         such amendment, except with the consent of the Optionee or Grantee, as
         the case may be.

         15.      Non-Exclusivity of the Program. The adoption of the Program by
the Board shall not be construed as amending, modifying or rescinding any
previously approved incentive arrangement or as creating any limitations on the
power of the Board to adopt such other incentive arrangements as it may deem
desirable, including, without limitation, the granting of stock options
otherwise than under the Program, and such arrangements may be either applicable
generally or only in specific cases.

         16.      Limitation of Liability. As illustrative of the limitations of
liability of the Company, but not intended to be exhaustive thereof, nothing in
the Program shall be construed to:

                  (a)      give any person any right to be granted an Option or
         Award other than at the sole discretion of the Committee;

                  (b)      give any person any rights whatsoever with respect to
         Shares except as specifically provided in the Program;

                  (c)      limit in any way the right of the Company to
         terminate the employment of any person at any time; or

                  (d)      be evidence of any agreement or understanding,
         expressed or implied, that the Company



                                      -12-
<PAGE>



         will employ any person in any particular position at any particular
         rate of compensation or for any particular period of time.

         17.      Regulations and Other Approvals Governing Law.

                  (a)      This Program and the rights of all persons claiming
         hereunder shall be construed and determined in accordance with the laws
         of the State of Delaware without giving effect to the conflicts of laws
         principles thereof, except to the extent that such law is preempted by
         federal law.

                  (b)      The obligation of the Company to sell or deliver
         Shares with respect to Options and Awards granted under the Program
         shall be subject to all applicable laws, rules and regulations,
         including all applicable federal and state securities laws, and the
         obtaining of all such approvals by governmental agencies as may be
         deemed necessary or appropriate by the Committee.

                  (c)      The Program is intended to comply with Rule 16b-3
         promulgated under the Exchange Act and the Committee shall interpret
         and administer the provisions of the Program or any Agreement in a
         manner consistent therewith. Any provisions inconsistent with such Rule
         shall be inoperative and shall not affect the validity of the Program.

                  (d)      The Board may make such changes as may be necessary
         or appropriate to comply with the rules and regulations of any
         government authority, or to obtain for Eligible Employees granted
         Incentive Stock Options the tax benefits under the applicable
         provisions of the Code and regulations promulgated thereunder.

                  (e)      Each Option and Award is subject to the requirement
         that, if at any time the Committee determines, in its discretion, that
         the listing, registration or qualification of Shares issuable pursuant
         to the Program is required by any securities exchange or under any
         state or federal law, or the consent or approval of any governmental
         regulatory body is necessary or desirable as a condition of, or in
         connection with, the grant of an Option or the issuance of Shares, no
         Options shall be granted or payment made or Shares issued, in whole or
         in part, unless listing, registration, qualification, consent or
         approval has been effected or obtained free of any conditions as
         acceptable to the Committee.

                  (f)      Notwithstanding anything contained in the Program to
         the contrary, in the event that the disposition of Shares acquired
         pursuant to the Program is not covered by a then current registration
         statement under the Securities Act of 1933, as amended, and is not
         otherwise exempt from such registration, such Shares shall be
         restricted against transfer to the extent required by the Securities
         Act of 1933, as amended, and Rule 144 or other regulations thereunder.
         The Committee may require any individual receiving Shares pursuant to
         the Program, as a condition precedent to receipt of such Shares
         (including upon exercise of an Option), to represent and warrant to the
         Company in writing that the Shares acquired by such individual are
         acquired without a view to any distribution thereof and will not be
         sold or transferred other than pursuant to an effective registration
         thereof under said Act or pursuant to an exemption applicable under the
         Securities Act of 1933, as amended, or the rules and regulations
         promulgated thereunder. The certificates evidencing any of such Shares
         shall be appropriately legended to reflect their status as restricted
         securities as aforesaid.

         18.      Miscellaneous.

                  (a)      Multiple Agreements. The terms of each Option or
         Award may differ from other Options or Awards granted under the Program
         at the same time, or at some other time. The Committee may also grant
         more than one Option or Award to a given Eligible Employee during the
         term of the Program, either in addition to, or in substitution for, one
         or more Options or Awards previously granted to that Eligible Employee.
         The grant of multiple Options and/or Awards may be evidenced by a
         single Agreement or multiple Agreements, as determined by the
         Committee.

                  (b)      Withholding of Taxes.

                           (1)      The Company shall have the right to deduct
                  from any distribution of cash to any Optionee or Grantee, an
                  amount equal to the federal, state and local income taxes and
                  other amounts as may be required by law to be withheld (the
                  `Withholding Taxes") with respect to any Option or Award. If
                  an Optionee or Grantee is entitled to receive Shares upon
                  exercise of an



                                      -13-
<PAGE>


                  Option or pursuant to an Award, the Optionee or Grantee shall
                  pay the Withholding Taxes to the Company prior to the
                  issuance, or release from escrow, of such Shares. In
                  satisfaction of the Withholding Taxes to the Company, the
                  Optionee or Grantee may make a written election (the "Tax
                  Election"), which may be accepted or rejected in the
                  discretion of the Committee, to have withheld a portion of the
                  Shares issuable to him or her upon exercise of the Option or
                  pursuant to an Award having an aggregate Fair Market Value
                  equal to the Withholding Taxes, provided that (i) in respect
                  of an Optionee or Grantee who may be subject to liability
                  under Section 16(b) of the Exchange Act (unless his or her
                  employment was terminated due to Disability or death), (A) the
                  Optionee or Grantee makes the Tax Election at least six (6)
                  months after the date the Option or Award was granted and (B)
                  the Tax Election is made either at least six (6) months prior
                  to the date that the amount of the Withholding Taxes are
                  determined (the "Tax Date") or during the ten (10) day period
                  beginning on the third business day and ending on the twelfth
                  business day following the release for publication of the
                  Company's quarterly or annual statements of earnings, (ii) the
                  Tax Election is made prior to the Tax Date, and (iii) the Tax
                  Election is irrevocable; provided, however, in the event that
                  the Tax Date occurs subsequent to the exercise of the Option
                  or issuance of Shares, the Optionee or Grantee shall tender
                  back to the Company on the Tax Date that number of Shares
                  having a Fair Market Value on the date preceding the Tax Date
                  at least equal to the Withholding Taxes.

                           (2)      If an Optionee makes a disposition, within
                  the meaning of Section 425(c) of the Code and regulations
                  promulgated thereunder, of any Share or Shares issued to him
                  pursuant to his exercise of the Option within the two-year
                  period commencing on the day after the date of the grant or
                  within the one-year period commencing on the day after the
                  date of transfer of such Share or Shares to the Optionee
                  pursuant to such exercise, the Optionee shall, within ten (10)
                  days of such disposition, notify the Company thereof, by
                  delivery of written notice to the Company at its principal
                  executive office, and immediately deliver to the Company the
                  amount of Withholding Taxes.

                  (c)      Designation of Beneficiary. Each Optionee and Grantee
         may designate a person or persons to receive in the event of his or her
         death, any Option or Award or any amount payable pursuant thereto, to
         which be or she would then be entitled. Such designation will be made
         upon forms supplied by and delivered to the Company and may be revoked
         in writing. If an Optionee fails effectively to designate a
         beneficiary, then his or her estate will be deemed to be the
         beneficiary.

         19.      Effective Date. The effective date of the Program shall be the
date of its adoption by the Board, subject only to the approval by the
affirmative votes of the holders of a majority of the securities of the Company
present, or represented, and entitled to vote at a meeting of stockholders duly
held in accordance with the applicable laws of the State of Delaware within
twelve (12) months of such adoption.



                                      -14-