A-13

                    IONICS, INCORPORATED
                              
                  1997 STOCK INCENTIVE PLAN
                              

1.   Purpose.  The purpose of this Plan is to enable officers
and other key employees of, and consultants to, Ionics,
Incorporated (the "Company") and any present or future parent
or subsidiary of the Company (collectively, "Related
Corporations") to (i) own shares of Stock in the Company,
(ii) participate in the shareholder value which has been
created, (iii) have a mutuality of interest with other
shareholders and (iv) enable the Company to attract, retain
and motivate key employees and consultants of particular
merit.  As used herein, the terms "parent" and "subsidiary"
mean "parent corporation" and "subsidiary corporation,"
respectively, as those terms are defined in Section 424 of
the Code.

2.   Definitions.  For the purposes of the Plan, the
following terms shall have the meanings set forth below:

  (a)  Award means the grant or sale pursuant to the Plan of
  any Stock Options and Long-Term Performance Awards.

  (b)  Board means the Board of Directors of the Company.
  
                            (c)  Code means the Internal
  Revenue Code of 1986, as amended from time to time, or any
  statute successor thereto, and any regulations issued from
  time to time thereunder.
  
  (d)  Company means Ionics, Incorporated, a corporation
  organized under the laws of the Commonwealth of
  Massachusetts (or any successor corporation).
  
     (e)  Disability means "permanent and total
  disability" as defined under Section 22(e)(3) of the Code
  or any successor statute.
  
  (f)  Effective Date means the date that the Plan is approved
  by both the Board of Directors of the Company and the
  stockholders of the Company, and if not approved on the same
  day, the date of the last approval.
  
  (g)  Fair Market Value means, as of any given date, the last
  reported sales price of the Stock as reported in The Wall
  Street Journal for such date, or if no such sale is reported
  on the last preceding trade date to the sales date, or if the
  Stock is not publicly traded on or as of such date, the fair
  market value of the Stock as determined by the Committee in
  good faith based on the available facts and circumstances at
  the time.
  
  (i)  Incentive Stock Option means any Stock Option intended
  to be and designated as an "Incentive Stock Option" within
  the meaning of Section 422 of the Code.
  
  (j)  Long-Term Performance Award means an Award made pursuant
  to Section 7 below that is payable in cash and/or Stock in
  accordance with the terms of the grant, based on Company,
  business unit and/or individual performance over a period of
  at least one year.
  
  (k)  Non-Qualified Stock Option means any Stock Option that
  is not an Incentive Stock Option.
  
  (l)  Participant means an employee or consultant to whom an
  Award is granted pursuant to the Plan.
  
  (m)  Plan means the Ionics, Incorporated 1997 Stock Incentive
  Plan, as set forth herein and as it may be amended from time
  to time.
  
  (n) Retirement means a termination of employment, for
  reasons other than death, which satisfies the requirements
  for normal, early, late or disability retirement in
  accordance with the Ionics, Incorporated Retirement Plan
  or any successor plan.
  
  (o) Stock means the common stock, $1.00 par value per
  share, of the Company.
  
     (p)  Stock Option or Option means any option to
  purchase shares of Stock granted pursuant to Section 6
  below.
  
  In addition the term Change in Control shall have meaning
  set forth in Section 8.2.
  
3.  Administration
  
  (a)  Board or Committee Administration.  The Plan shall be
  administered by the Board or, subject to paragraph 3(d)
  (relating to compliance with Section 162(m) of the Code), by
  a committee appointed by the Board (the "Committee"), which
  shall initially be the Compensation Committee of the Board.
  Hereinafter, all references in this Plan to the "Committee"
  shall mean the Board if no Committee has been appointed.
  Subject to ratification of the grant or authorization of each
  Award by the Board (if so required by applicable state law),
  and subject to the terms of the Plan, the Committee shall
  have the authority to (i) determine to whom (from among the
  class of employees eligible under Section 5 to receive
  Incentive Stock Options) Incentive Stock Options shall be
  granted, and to whom (from among the class of individuals and
  entities eligible under Section 5 to receive Non-Qualified
  Stock Options and Long-Term Performance Awards) Non-Qualified
  Stock Options and Long-Term Performance Awards may be
  granted, (ii) determine the time or times at which Awards
  shall be granted; (iii) determine the purchase price of
  shares subject to each Option, which prices shall not be less
  than the minimum price specified in Section 6.2(a); (iv)
  determine whether each Option granted shall be an Incentive
  Stock Option or a Non-Qualified Stock Option; (v) determine
  (subject to Sections 6.2(b) and 6.2(c)) the time or times
  when each Option shall become exercisable and the duration of
  the exercise period; (vi) extend the period during which
  outstanding Options may be exercised; (vii) determine whether
  restrictions such as repurchase options are to be imposed on
  shares subject to Awards and the nature of such restrictions,
  if any; and (viii) interpret the Plan and prescribe and
  rescind rules and regulations relating to it.  If the
  Committee determines to issue a Non-Qualified Stock Option,
  it shall take whatever actions it deems necessary, under
  Section 422 of the Code and the regulations promulgated
  thereunder, to ensure that such Non-Qualified Stock Option is
  not treated as an Incentive Stock Option.  The interpretation
  and construction by the Committee of any provisions of the
  Plan or of any Award granted under it shall be final unless
  otherwise determined by the Board.  The Committee may from
  time to time adopt such rules and regulations for carrying
  out the Plan as it may deem advisable.  No member of the
  Board or the Committee shall be liable for any action or
  determination made in good faith with respect to the Plan or
  any Award granted under it.
     
  (b)  Committee Actions.  The Committee may select one of its
  members as its chairman, and shall hold meetings at such time
  and places as it may determine.  A majority of the Committee
  shall constitute a quorum and acts of a majority of the
  members of the Committee at a meeting at which a quorum is
  present, or acts reduced to or approved in writing by all the
  members of the Committee (if consistent with applicable state
  law), shall be the valid acts of the Committee.  From time to
  time the Board may increase the size of the Committee and
  appoint additional members thereof, remove members (with or
  without cause) and appoint new members in substitution
  therefor, fill vacancies however caused, or remove all
  members of the Committee and thereafter directly administer
  the Plan.
  
  (c)  Grant of Awards to Board Members.  Awards may be granted
  to members of the Board who are otherwise eligible to receive
  Awards under the Plan.  All grants of Awards to members of
  the Board shall in all respects be made in accordance with
  the provisions of this Plan applicable to other eligible
  persons.  Members of the Board who either (i) are eligible to
  receive grants of Awards pursuant to the Plan or (ii) have
  been granted Awards may vote on any matters affecting the
  administration of the Plan or the grant of any Awards
  pursuant to the Plan, except that no such member shall act
  upon the granting to himself or herself of Awards, but any
  such member may be counted in determining the existence of a
  quorum at any meeting of the Board during which action is
  taken with respect to the granting to such member of Awards.
  
  (d)  Performance-Based Compensation.  The Board, in its
  discretion, may take such action as may be necessary to
  ensure that Stock Options granted under the Plan qualify as
  "qualified performance-based compensation" within the meaning
  of Section 162(m) of the Code and applicable regulations
  promulgated thereunder ("Performance-Based Compensation").
  Such action may include, in the Board's discretion, some or
  all of the following: (i) if the Board determines that Stock
  Options granted under the Plan generally shall constitute
  Performance-Based Compensation, the Plan shall be
  administered, to the extent required for such Stock Options
  to constitute Performance-Based Compensation, by a Committee
  consisting solely of two or more "outside directors" (as
  defined in applicable regulations promulgated under Section
  162(m) of the Code); and (ii) Stock Options and Stock Grants
  granted under the Plan may be subject to such other terms and
  conditions as are necessary for compensation recognized in
  connection with the exercise or disposition of such Stock
  Option or the disposition of Stock acquired pursuant to such
  Stock Option to constitute Performance-Based Compensation.
  
4.   Shares of Stock Subject to the Plan.

  (a)  Stock.  The Stock subject to Awards shall be authorized
  but unissued shares of Stock or shares of Stock reacquired by
  the Company in any manner.  Subject to adjustment as provided
  in subsection (c) of this Section 4, the aggregate number of
  shares of Stock that may be issued pursuant to the Plan shall
  be (i) 750,000 (which number includes the aggregate number of
  shares with respect to which no options have been granted
  under the 1979 Stock Option Plan on the Effective Date), plus
  (ii) such number of shares as to which options granted under
  the 1979 Stock Option Plan terminate or expire without being
  fully exercised, plus (iii) effective as of January 1, 1998
  and each of the three successive years thereafter, a number
  of shares of Stock equal to two percent (2%) of the total
  number of shares of Stock issued and outstanding as of the
  close of business on December 31 of the preceding year.
  Subject to adjustment as provided in subsection (c) of this
  Section 4, no more than an aggregate of 750,000 shares of
  Stock may be issued pursuant to the exercise of Incentive
  Stock Options granted under the Plan (including shares issued
  pursuant to the exercise of Incentive Stock Options granted
  under the Plan that are the subject of disqualifying
  dispositions within the meaning of Sections 421, 422 and 424
  of the Code and the regulations thereunder); and no more than
  an aggregate of 150,000 shares of Stock may be issued in
  connection with Long-Term Performance Awards granted under
  this Plan.  If any Award granted under the Plan shall expire
  or terminate for any reason without having been exercised in
  full or shall cease for any reason to be exercisable in whole
  or in part, the unpurchased shares subject to such Award
  shall again be available for grants of Awards under the Plan.

  No employee of the Company or any Related Corporation may
  be granted Options (or any other Award) to acquire, in the
  aggregate, more than 200,000 shares of Stock during any 12-
  month period under the Plan.  If any Option granted under
  the Plan shall expire or terminate for any reason without
  having been exercised in full or shall cease for any
  reason to be exercisable in whole or in part, the
  unpurchased shares subject to such Option shall be
  included in the determination of the aggregate number of
  shares of Stock deemed to have been granted to such
  employee under the Plan.
  
  (b)  Computation of Available Shares.  For the purpose of
  computing the total number of shares of Stock available for
  Plan purposes at any time during which the Plan is in effect,
  there shall be debited against the total number of shares
  determined to be available pursuant to paragraphs (a) and (c)
  of this Section 4 the maximum number of shares of Stock
  subject to issuance upon exercise of Options or upon
  settlement of other Awards theretofore made under the Plan.
  In addition, however, shares related to the unexercised or
  undistributed portion of any terminated, expired or forfeited
  Award for which no material benefit was received by a
  Participant (e.g. dividends, but not including voting
  rights), or to the portion of any Award settled in cash,
  shall be recredited to the number remaining upon such
  termination, expiration or forfeiture and thereafter again be
  available for distribution in connection with future Awards
  under the Plan.
  
  (c)  Other Adjustment.  In the event of any merger,
  reorganization, consolidation, recapitalization, Stock
  dividend, or other change in corporate structure affecting
  the Stock, such substitution or adjustment shall be made
  in the aggregate number of shares reserved for issuance
  under the Plan, and in the number and option price of
  shares subject to outstanding Options and other Stock-
  based Awards granted under the Plan, as may be determined
  to be appropriate by the Committee in its sole discretion
  provided that the number of shares subject to any Award
  shall always be a whole number.
  
5.   Eligibility.  Incentive Stock Options may be granted
  only to employees of the Company and any Related Corporation.
  Officers and other key employees of or consultants to the
  Company, who are responsible for or contribute to, as
  determined by the Committee in its sole discretion, the
  management, growth and/or profitability of the business of
  the Company and/or any Related Corporation are eligible for
  Awards under the Plan.

6.   Stock Options.

  6.1  Provision for Grant.  Stock Options may be granted
  alone, in addition to or in tandem with other Awards under
  the Plan.  Any Stock Option granted under the Plan shall be
  in such form as the Committee may from time to time approve.
  The Committee shall have the authority to grant any optionee
  who is an employee of the Company, or of any Related
  Corporation, Incentive Stock Options, Non-Qualified Stock
  Options, or both types of Stock Options.  To the extent that
  any Stock Option does not qualify as an Incentive Stock
  Option, it shall constitute a separate Non-Qualified Stock
  Option.  In the case of any other person eligible for an
  Award under the Plan, any Stock Option granted under the Plan
  shall be a Non-Qualified Stock Option.

  Anything in the Plan to the contrary notwithstanding, no
  term of this Plan relating to Incentive Stock Options
  shall be interpreted, amended or altered, nor shall any
  discretion or authority granted under the Plan be so
  exercised, so as to disqualify the Plan under Section 422
  of the Code, or, without the consent of the optionee(s)
  affected, to disqualify any Incentive Stock Option under
  such Section 422.

     6.2  Terms and Conditions.  Options granted under the Plan
  shall be subject to the following terms and conditions and
  shall contain such additional terms and conditions, not
  inconsistent with the terms of the Plan, as the Committee
  shall deem appropriate:
     
       (a)  Option Price.  The option price per share of Stock
     purchasable under a Stock Option shall be determined by the
     Committee at the time of grant but shall be not less than
     100% of the Fair Market Value of the Stock at the time of
     grant.  However, any Incentive Stock Option granted to any
     optionee who, at the time the option is granted, owns more
     than 10% of the voting power of all classes of stock of the
     Company or of a parent or subsidiary corporation (in each
     case as defined in Section 424 of the Code) shall have an
     exercise price no less than 110% of Fair Market Value per
     share on date of the grant.
       
       (b)  Option Term.  The term of each Stock Option shall be
     fixed by the Committee, but no Stock Option shall be
     exercisable more than ten years after the date on which the
     Option is granted.  However, any Incentive Stock Option
     granted to any optionee who, at the time the Option is
     granted, owns more than 10% of the voting power of all
     classes of stock of the Company or of a parent or subsidiary
     corporation (in each case as defined in Section 424 of the
     Code) may not have a term of more than five years.  No Stock
     Option may be exercised by any person after expiration of the
     term of the Option.
       
       (c)  Exercisability.  Stock Options shall be exercisable at
     such time or times and subject to such terms and conditions
     as shall be determined by the Committee at or after grant,
     provided, however, that, except as provided in Sections
     6.2(f), 6.2(g) and 8, unless otherwise determined by the
     Committee at or after grant, no Stock Option shall be
     exercisable during the six months following the date of the
     granting of the Option.  If the Committee provides, in its
     discretion, that any Stock Option is exercisable only in
     installments, the Committee may waive such installment
     exercise provisions at any time at or after grant in whole or
     in part, based on such factors as the Committee shall
     determine, in its sole discretion.
       
       (d)  Method of Exercise.  Subject to whatever installment
     exercise provisions apply pursuant to Section 6.2(c), Stock
     Options may be exercised in whole or in part at any time and
     from time to time during the option period, by giving written
     notice of exercise to the Company specifying the number of
     shares to be purchased.  Such notice shall be accompanied by
     payment in full of the purchase price, either by certified or
     bank check, or such other instrument as the Committee may
     accept.  As determined by the Committee, in its sole
     discretion, payment in full or in part may also be made in
     the form of unrestricted Stock already owned by the optionee
     (based, in each case, on the Fair Market Value of the Stock
     on the date the option is exercised, as determined by the
     Committee); provided, however, that, in the case of an
     Incentive Stock Option, the right to make a payment in the
     form of already owned shares may be authorized only at the
     time the Option is granted.
    
       If payment of the Option exercise price of a Stock
     Option is made in whole or in part in the form of
     unrestricted Stock already owned by the Participant, the
     Company may require that the Stock has been owned by the
     Participant for a specified minimum period of time, for
     the purpose of avoiding any charge to the Company's
     earnings, limiting the pyramiding of Stock Option
     exercises, or such other purposes as the Company deems
     appropriate.
    
       No shares of Stock shall be issued until full payment
     therefor has been made.  An optionee shall generally
     have the rights to dividends or other rights of a
     shareholder with respect to shares subject to the Option
     when the optionee has given written notice of exercise,
     has paid in full for such shares, and, if requested, has
     given the representation described in Section 11.1.
       
       (e)  Transferability.  No Stock Option shall be transferable
     by the optionee otherwise than by will or by the laws of
     descent and distribution, and all Stock Options shall be
     exercisable, during the optionee's lifetime, only by the
     optionee, provided, however, the Committee may grant Non-
     Qualified Stock Options that are transferable, without
     payment of consideration, to immediate family members of the
     optionee or to trusts for such family members, or to
     partnerships in which such immediate family members are the
     only parties, subject to such limits as the Committee may
     establish, and the transferee shall remain subject to all of
     the terms and conditions applicable to such Non-Qualified
     Stock Options prior to such transfer.
       
       (f)  Termination by Reason of Death.  If an optionee's
     employment by or association with the Company  or any Related
     Corporation terminates by reason of death, any Stock Option
     held by such optionee may thereafter be exercised, to the
     extent then exercisable at the time of death, or on such
     accelerated basis as the Committee may determine at or after
     grant, by the legal representative of the estate or by the
     legatee of the optionee under the will of the optionee, for a
     period of 90 days (or such shorter period as the Committee
     may specify at grant) from the date of such death or until
     the expiration of the stated term of such Stock Option,
     whichever period is the shorter.
       
       (g)  Termination by Reason of Disability or Retirement.  If
     an optionee's employment by or association with the Company
     or any Related Corporation terminates by reason of Disability
     or Retirement, any Stock Option held by such optionee may
     thereafter be exercised by the optionee, to the extent it was
     exercisable at the time of termination, or on such
     accelerated basis as the Committee may determine at or after
     grant, for a period of 90 days (or such shorter period as the
     Committee may specify at grant) from the date of such
     termination of employment or until the expiration of the
     stated term of such Stock Option, whichever period is the
     shorter; provided, however, that, if the optionee dies within
     such 90-day period (or such shorter period as the Committee
     shall specify at grant), any unexercised Stock Option held by
     such optionee shall thereafter be exercisable to the extent
     to which it was exercisable at the time of death for a period
     of 90 days from the date of such death or until the
     expiration of the stated term of such Stock Option, whichever
     period is the shorter.
       
       (h)  Other Termination.  Unless otherwise determined by the
     Committee at grant, if an optionee's employment by or
     association with the Company or any Related Corporation
     terminates for any reason other than death, Disability or
     Retirement, the Stock Option shall thereupon terminate,
     except that in the Committee's sole discretion, based upon
     such factors as the Committee may deem appropriate, the
     Committee may specify that such Stock Option may be
     exercised, to the extent exercisable at termination, or on
     such accelerated basis as the Committee may determine at or
     after grant, for a period of 90 days (or such shorter period
     as the Committee shall specify at grant) from the date of
     such termination or until the expiration of the stated term
     of such Stock Option, whichever period is shorter.
       
       (i)  Incentive Stock Option Limitations.  To the extent
     required for "incentive stock option" status under Section
     422 of the Code, the aggregate Fair Market Value (determined
     as of the time of grant) of the Stock with respect to which
     Incentive Stock Options granted are exercisable for the first
     time by the optionee during any calendar year under the Plan
     and/or any other stock option plan of the Company and any
     parent or subsidiary corporation (within the meaning of
     Section 424 of the Code) shall not exceed $100,000.  The
     Company intends to designate any Options granted in excess of
     the $100,000 limitation as Non-Qualified Stock Options, and
     the Company shall issue certificates to the optionee with
     respect to the Options that are Non-Qualified Options and
     Options that are Incentive Stock Options.
       
       (j)  Cashless Exercise; Satisfaction of Tax Withholdings.  To
     the extent permitted under applicable laws and regulations,
     at the request of a Participant, the Company agrees to
     cooperate in a "cashless exercise" of an Option.  The
     cashless exercise shall be effected by the Participant
     delivering to a registered securities broker acceptable to
     the Company instructions to sell a sufficient number of
     shares of Stock for which such Option is then exercisable to
     cover the costs and expenses associated with such exercise
     and sale.  Under any Option, the Committee may permit a
     Participant to pay any applicable withholding taxes by
     delivering a sufficient number of previously owned shares of
     Common Stock to the Company to satisfy such taxes.
     
7.   Long-Term Performance Awards

  7.1  Provision for Grant.  Long-Term Performance Awards
  may be awarded either alone or in addition to other Awards
  granted under the Plan.  The Committee shall determine the
  nature, length and starting date of the performance period
  (the "Performance Period") for each Long-Term Performance
  Award, which subject to Section 8 below shall be a period
  of at least one year, and shall determine the performance
  objectives to be used in valuing Long-Term Performance
  Awards and determining the extent to which such Long-Term
  Performance Awards have been earned.  Performance
  objectives may vary from Participant to Participant and
  between groups of Participants and shall be based upon
  such Company, business unit and/or individual performance
  factors and criteria as the Committee may deem
  appropriate, including, but not limited to, earnings per
  share or return on equity.  Performance Periods may
  overlap and Participants may participate simultaneously
  with respect to Long-Term Performance Awards that are
  subject to different Performance Periods and/or different
  performance factors and criteria.
  
  7.2  Periodical Determination of Performance.  At the
  beginning of each Performance Period, the Committee shall
  determine for each Long-Term Performance Award subject to
  such Performance Period the range of dollar values or
  number of shares of Stock to be awarded to the Participant
  at the end of the Performance Period if and to the extent
  that the relevant measure(s) of performance for such Long-
  Term Performance Award is (are) met.  Such dollar values
  or number of shares of Stock may be fixed or may vary in
  accordance with such performance and/or other criteria as
  may be specified by the Committee, in its sole discretion.

  7.3  Adjustment of Awards.  In the event of special or
  unusual events or circumstances affecting the application
  of one or more performance objectives to a Long-Term
  Performance Award, the Committee may revise the
  performance objectives and/or underlying factors and
  criteria applicable to the Long-Term Performance Awards
  affected, to the extent deemed appropriate by the
  Committee, in its sole discretion, to avoid unintended
  windfalls or hardship.
  
  7.4  Termination of Employment.  Subject to Section 8
  below and unless otherwise provided in the applicable
  Award agreement(s), if a Participant terminates employment
  or other association with the Company or any Related
  Corporation during a Performance Period because of death,
  Disability or Retirement, such Participant shall be
  entitled to a payment with respect to each outstanding
  Long-Term Performance Award at the end of the applicable
  Performance Period (i) based, to the extent relevant under
  the terms of the award, upon the Participant's performance
  for the portion of such Performance Period ending on the
  date of termination and the performance of the applicable
  business unit(s) for the entire Performance Period, and
  (ii) prorated, where deemed appropriate by the Committee,
  for the portion of the Performance Period during which the
  Participant was employed by or associated with the Company
  and any Related Corporation, all as determined by the
  Committee, in its sole discretion.  However, the Committee
  may provide for an earlier payment in settlement of such
  award in such amount and under such terms and conditions
  as the Committee deems appropriate.

       Subject to Section 8 below, if a Participant
  terminates employment by or association with the Company
  and any Related Corporation during a Performance Period
  for any other reason, then such Participant shall not be
  entitled to any payment with respect to Long-Term
  Performance Awards subject to such Performance Period,
  unless the Committee shall otherwise determine, in its
  sole discretion.

  7.5  Form of Payment.  The earned portion of a Long-Term
  Performance Award may be paid currently or on a deferred
  basis with such interest or earnings equivalent as may be
  determined by the Committee, in its sole discretion.
  Payment shall be made in the form of cash or whole shares
  of Stock, either in a lump sum payment or in annual
  installments commencing as soon as practicable after the
  end of the relevant Performance Period, all as the
  Committee shall determine at or after grant.

8.  Change in Control Provisions.

  8.1  Consequences of Event.  In the event of a Change in
  Control, in addition to the adjustment provided for in
  Section 4(c), the Committee may in its discretion
  determine whether, with respect to all Stock Options
  granted and Awards made before the Change in Control, the
  following acceleration and valuation provisions shall
  apply:
  
     (a)  Any Stock Options awarded under the Plan not previously
     exercisable shall thereupon become fully exercisable.
     
     (b)  Any outstanding Long-Term Performance Awards shall be
     paid out in cash within thirty days following the Change in
     Control based on prorated target results for the Performance
     Periods in question.
     
     In case of any reorganization, merger or consolidation
  of the Company into or with another company or in the case
  of any sale or conveyance to another company or entity of
  the property of the Company as a whole or substantially as
  a whole, each Stock Option shall be automatically
  converted into a stock option or other award which covers
  shares of stock or other securities equivalent in kind and
  value to the shares or other securities the optionee or
  holder would have held if the Stock Option or other Award
  had been exercised or received in full prior to such
  reorganization, merger, consolidation, sale or conveyance
  and no disposition thereof had subsequently been made, and
  the option price under each Stock Option shall be
  proportionately adjusted.

  8.2  Change in Control.  For purposes of this Plan, a
  "Change in Control" means the happening of any of the
  following:

     (a)  The acquisition, other than from the Company, by any
     individual, entity or group (within the meaning of Section
     12(d)(3) or 14(d)(2) of the Securities Exchange Act of 1934,
     as amended (the "Exchange Act")) of beneficial ownership
     (within the meaning of Rule 13d-3 promulgated under the
     Exchange Act) of 20% or more of either (i) the then
     outstanding shares of common stock of the Company (the
     "Outstanding Company Common Stock") or (ii) the combined
     voting power of the then outstanding voting securities of the
     Company entitled to vote generally in the election of
     directors (the "Company Voting Securities"); provided,
     however, that any acquisition by (x) any noncorporate
     shareholder of the Company as of the effective date of the
     initial registration of an offering of Stock under the
     Securities Act of 1933, (y) the Company or any of its
     subsidiaries, or any employee benefit plan (or related trust)
     sponsored or maintained by the Company or any of its
     subsidiaries, or (z) any corporation with respect to which,
     following such acquisition, more than 60% of, respectively,
     the then outstanding shares of common stock of such
     corporation and combined voting power of the then outstanding
     voting securities of such corporation entitled to vote
     generally in the election of directors is then beneficially
     owned, directly or indirectly, by all or substantially all of
     the individuals and entities who were the beneficial owners,
     respectively, of the Outstanding Company Common Stock and
     Company Voting Securities immediately prior to such
     acquisition in substantially the same proportion as their
     ownership, immediately prior to such acquisition, of the
     Outstanding Company Common Stock and Company Voting
     Securities, as the case may be, shall not constitute a Change
     in Control of the Company; or
     
     (b)  Continuing Directors constitute less than a majority of
     the Board, where a Continuing Director is (i) each person who
     was a director of the Company on January 2, 1997, and (ii)
     each person who subsequently becomes a director of the
     Company and whose election or nomination was approved by a
     vote of at least a majority of the Continuing Directors in
     office at the time of the election or nomination unless that
     person became a director in connection with an actual or
     threatened election contest; or
     
     (c)  Approval by the shareholders of the Company of a
     reorganization, merger or consolidation (a "Business
     Combination"), in each case, with respect to which all or
     substantially all of the individuals and entities who were
     the respective beneficial owners of the Outstanding Company
     Common Stock and Company Voting Securities immediately prior
     to such Business Combination do not own beneficially,
     directly or indirectly, more than 60% of, respectively, the
     then outstanding shares of common stock and the combined
     voting power of the then outstanding voting securities
     entitled to vote generally in the election of directors, as
     the case may be, of the corporation resulting from such
     Business Combination in substantially the same proportion as
     their ownership immediately prior to such Business
     Combination of the Outstanding Company Common Stock and
     Company Voting Securities, as the case may be; or
     
     (d)  a complete liquidation or dissolution of the Company or
     a sale or other disposition of all or substantially all of
     the assets of the Company other than to a corporation with
     respect to which, following such sale or disposition, more
     than 60% of, respectively, the then outstanding shares of
     common stock and the combined voting power of the then
     outstanding voting securities entitled to vote generally in
     the election of directors is then owned beneficially,
     directly or indirectly, by all or substantially all of the
     individuals and entities who were the beneficial owners,
     respectively, of the Outstanding Company Common Stock and
     Company Voting Securities immediately prior to such sale or
     disposition in substantially the same proportion as their
     ownership of the Outstanding Company Common Stock and Company
     Voting Securities, as the case may be, immediately prior to
     such sale or disposition.
     
9.  Amendment and Termination.  The Board may terminate or
amend the Plan at any time and from time to time;  provided,
however, that the Board may not, without approval of the
shareholders of the Company, increase the maximum number of
shares of Stock issuable under the Plan or change the
description of the individuals eligible to receive Awards.
No termination of or amendment to the Plan may adversely
affect the rights of a Participant with respect to any Award
theretofore granted under the Plan without such Participant's
consent.

  The Committee may amend the terms of any Award theretofore
granted, prospectively or retroactively, but, subject to
Section 4 above, no such amendment shall (i) decrease the
exercise price of an outstanding Stock Option, or (ii) effect
the simultaneous cancellation of an outstanding Stock Option
and new grant of a replacement Stock Option, or (iii) without
the Participant's consent, impair the rights of any
Participant.

10.  Unfunded Status of Plan.  The Plan is intended to
constitute an "unfunded" plan for incentive and deferred
compensation.  With respect to any payments not yet made to a
Participant by the Company, nothing contained herein shall
give any such Participant any rights that are greater than
those of any other general creditor of the Company.  In its
sole discretion, the Committee may authorize the creation of
trusts or other arrangements to meet the obligations created
under the Plan to deliver Stock or payments in lieu of or
with respect to Awards hereunder; provided, however, unless
the Committee otherwise determines with the consent of the
affected Participant, the existence of such trusts or other
arrangements shall be consistent with the "unfunded" status
of the Plan.

11.  General Provisions.

   11.1  Investment Representation.  The Committee may
   require each person acquiring shares pursuant to an Award
   under the Plan to represent to and agree with the Company
   in writing that the Participant is acquiring the shares
   for investment without a view to distribution thereof.
   The certificates for such shares may include any legend
   which the Committee deems appropriate to reflect any
   restrictions on transfer.  All certificates for shares of
   Stock or other securities delivered under the Plan shall
   be subject to such stock-transfer orders and other
   restrictions as the Committee may deem advisable under
   the rules, regulations, and other requirements of any
   stock exchange upon which the Stock is then listed, and
   any applicable Federal or state securities law, and the
   Committee may cause a legend or legends to be put on any
   such certificates to make appropriate reference to such
   restrictions.

  11.2  Adoption of Other Plans.  Nothing contained in this
  Plan shall prevent the Board of Directors from adopting
  other or additional compensation arrangements, subject to
  stockholder approval if such approval is required; and
  such arrangements may be either generally applicable or
  applicable only in specific cases.
  
  11.3  No Employment Rights.  Neither the establishment or
  continuation of the Plan, nor the grant of any Award
  hereunder, shall confer upon any employee or consultant of
  the Company or any Related Corporation any right to
  continued employment or association with the Company and
  any Related Corporation, nor shall it interfere in any way
  with the right of the Company and any Related Corporation
  to terminate the employment or association of any of its
  employees or consultants at any time.
  
  11.4  Participant Not to Compete.  In consideration of the
  Company's grant of an Award, a Participant shall agree in
  the agreement setting forth the terms of such Award that
  during the period of his  employment by or other service
  with the Company or any Related Corporation, and for a
  period of at least two (2) years after the date such
  employment or service terminates, he will not without the
  consent of the Board accept or perform work for any entity
  whose business is competitive with the business carried on
  by the Company and any Related Corporation, or engage in
  activities which are significantly competitive with the
  business of the Company and any Related Corporation.  In
  the event a Participant breaches such agreement, the
  Participant shall forfeit all rights to any unexercised
  Options or unearned Awards held as of the date of such
  breach.
  
  11.5  Tax Withholding.  No later than the date as of which
  an amount first becomes includible in the gross income of
  the Participant for Federal income tax purposes with
  respect to any Award, the Participant shall pay to the
  Company, or make arrangements satisfactory to the
  Committee regarding the payment of, any Federal, state, or
  local taxes of any kind required by law to be withheld
  with respect to such amount.  Unless otherwise determined
  by the Committee, the minimum required withholding
  obligations may be settled with Stock.  The obligations of
  the Company under the Plan shall be conditional on such
  payment or arrangements and the Company shall, to the
  extent permitted by law, have the right to deduct any such
  taxes from any payment of any kind otherwise due to the
  Participant.
  
  11.6  Payments on Death.  The Committee shall establish
  such procedures as it deems appropriate for a Participant
  to designate a beneficiary to whom any amounts payable in
  the event of the Participant's death are to be paid.
  
  11.7  Governing Law.  The Plan and all Awards and actions
  taken thereunder shall be governed by and construed in
  accordance with the laws of the Commonwealth of
  Massachusetts, without regard to the conflict of laws
  principles thereof.
  
12. Term of Plan.  The Plan shall become effective upon the
approval of the Plan by the shareholders of the Company.  No
Award shall be granted pursuant to the Plan on or after the
tenth anniversary of the Plan's approval by shareholders, but
Awards theretofore granted may extend beyond that date.