<PAGE>

                                                                         Page 1

                            THE COLEMAN COMPANY, INC.
                             1996 STOCK OPTION PLAN
                             ----------------------
                                  (As Amended)



1.   PURPOSE.

     This 1996 Stock Option Plan (the "Plan") is intended to encourage stock
     ownership by employees of The Coleman Company, Inc. (the "Company") and
     employees of Affiliated Corporations (as defined in Section 2(a) hereof),
     so that they may acquire or increase their proprietary interest in the
     Company, and to encourage such employees to remain in the employ of the
     Company and to put forth maximum efforts for the success of the business. 
     It is further intended that options granted by the Committee (as defined
     herein) pursuant to Section 6 of this Plan shall constitute "incentive
     stock options" ("Incentive Stock Options") within the meaning of Section
     422 of the Internal Revenue Code of 1986, as amended, and the regulations
     issued thereunder (the "Code"), and options granted by the Committee
     pursuant to Section 7 of this Plan shall constitute "nonqualified stock
     options" ("Nonqualified Stock Options").  Options granted under the Plan
     ("Options") may be accompanied by stock appreciation rights ("Rights"), as
     hereinafter set forth.  Rights may also be granted alone.

2.   DEFINITIONS.

     As used in this Plan, the following words and phrases shall have the
     meanings indicated:

     (a)  "Affiliate Corporation" or "Affiliate" shall mean any corporation,
          directly or indirectly, through one or more intermediaries,
          controlling, controlled by, or under common control with the Company.

     (b)  "Disability" shall mean an inability of an Optionee (as defined
          herein) to engage in any substantial gainful activity by reason of any
          medically determinable physical or mental impairment that can be
          expected to result in death or that has lasted or can be expected to
          last for a continuous period of not less than twelve months.

     (c)  "Change of Control" shall mean that any of the following events will
          be deemed to have taken place:

          (i)  any  "person" (as defined in Section 3(a)(9) of the Securities


<PAGE>

                                                                         Page 2

               Exchange Act of 1934, as amended (the "Exchange Act"), and as
               modified in Sections 13(d) and 14(d) of the Exchange Act) other
               than (A) the Corporation or any of its subsidiaries, (B) any
               employee benefit plan of the Corporation or one of its
               subsidiaries, or (C) MacAndrews & Forbes Holdings Inc. or any
               affiliate thereof (collectively, "MAFCO"), (D) a corporation
               owned, directly or indirectly, by shareholders of the Corporation
               in substantially the same proportions as their ownership of the
               Corporation, or (E) an underwriter temporarily holding securities
               pursuant to an offering of such securities (a "Person"), becomes
               a "beneficial owner" (as defined in Rule 13(d)(3) of the Exchange
               Act), directly or indirectly, of securities of the Corporation
               representing 20% or more of the shares of common stock of the
               Corporation then outstanding, and such Person's beneficial
               ownership level then exceeds the percentage of the Corporation's
               outstanding shares beneficially owned by MAFCO;

          (ii) the consummation of any merger or consolidation of the
               Corporation or one of its subsidiaries with or into another
               corporation, other than a merger or consolidation which would
               result in the holders of the voting securities of the Corporation
               outstanding immediately prior thereto holding securities which
               represent immediately after such merger or consolidation more
               than 80% of the combined voting power of the voting securities of
               the Corporation or the surviving corporation or the parent of
               such surviving corporation;

         (iii) the shareholders of the Corporation approve a plan of complete 
               liquidation of the Corporation or an agreement for the sale or 
               disposition by the Corporation of all or substantially all of 
               the Corporation's assets; or

          (iv) a majority of the Board of Directors votes in favor of a decision
               that a Change of Control has occurred.

     (d   (c)  "Fair Market Value" per share as of a particular date shall mean 
               (i) the closing sales price per share of Common Stock (as defined
               herein) on a specified date which is on or after the date on 
               which a resolution is adopted to expressly grant an Option, or 
               (ii) if the shares of Common Stock are then traded on an over-
               the-counter market, the average of the closing bid and asked 
               prices for the shares of Common Stock in such over-the-counter 
               market for the last preceding date on which there was a sale of 
               such Common Stock in such market, or (iii) if the shares of 
               Common Stock are not 


<PAGE>

                                                                         Page 3

               then listed on a national securities exchange or traded in an 
               over-the-counter market, such value as the Committee in its 
               discretion may determine.

     (e)  "Parent Corporation" shall mean any corporation (other than the
          Company) in an unbroken chain of corporations ending with the Company
          if, at the time of granting an Option, each of such corporations
          (other than the Company) owns stock possessing fifty percent or more
          of the total combined voting power of all classes of stock in one of
          the other corporations in such chain.

     (f)  "Subsidiary Corporation" shall mean any corporation (other than the
          Company) in an unbroken chain of corporations beginning with the
          Company if, at the time of granting an Option, each of such
          corporations other than the last corporation in an unbroken chain owns
          stock possessing fifty percent or more of the total combined voting
          power of all classes of stock in one of the other corporations in such
          chain.
     
     (g)  "Ten Percent Stockholder" shall mean an Optionee who, at the time an
          Incentive Stock Option is granted, owns stock possessing more than ten
          percent of the total combined voting power of all classes of stock of
          the Company or of its Parent Corporations or Subsidiary Corporations.

3.   ADMINISTRATION.

     The Plan shall be administered by the Management Compensation and Stock 
     Option Committee (the "Committee"), consisting of at least two members 
     of the Board of Directors of the Company (the "Board"), none of whom is 
     or shall have been for at least one year prior to such appointment 
     granted or awarded equity securities pursuant to the Plan or any other 
     plan of the Company or any of its Affiliates entitling the participants 
     therein to acquire stock, stock options or stock appreciation rights of 
     the Company or any of its Affiliates.

     The Committee shall have the authority in its discretion, subject to 
     and not inconsistent with the express provisions of the Plan, to 
     administer the Plan and to exercise all the powers and authorities 
     either specifically granted to it under the Plan or necessary or 
     advisable in the administration of the Plan, including, without 
     limitation, the authority to grant Options; to determine which Options 
     shall constitute Incentive Stock Options and which Options shall 
     constitute Nonqualified Stock Options; to determine which Options (if 
     any) shall be accompanied by Rights; to determine the purchase price of 
     the shares of Common Stock covered by each Option (the "Option Price"); 
     to determine the persons to whom, and the time or 


<PAGE>

                                                                         Page 4

     times at which, Options shall be granted; to determine the number of 
     shares to be covered by each Option; to interpret the Plan; to 
     prescribe, amend and rescind rules and regulations relating to the 
     Plan; to determine the terms and provisions relating to the Plan; to 
     determine the terms and provisions of the Option Agreements (which need 
     not be identical) entered into in connection with Options granted under 
     the Plan; and to make all other determinations deemed necessary or 
     advisable for the administration of the Plan.  The Committee may 
     delegate to one or more of its members or to one or more agents such 
     administrative duties as it may deem advisable, and the Committee or 
     any person to whom it has delegated duties as aforesaid may employ one 
     or more persons to render advice with respect to any responsibility the 
     Committee or such person may have under the Plan.
     
     No member of the Board or Committee shall be liable for any action 
     taken or determination made in good faith with respect to the Plan or 
     any Option or Right granted hereunder.


<PAGE>

                                                                         Page 5

4.4  ELIGIBILITY.

     Options or Rights, or both, may be granted to key employees (including, 
     without limitation, officers and directors who are employees) of the 
     Company or its present or future Affiliate Corporations, except that 
     Incentive Stock Options shall be granted only to individuals who, on 
     the date of such grant, are employees of the Company or a Parent 
     Corporation or a Subsidiary Corporation.  In determining the persons to 
     whom Options and Rights shall be granted and the number of shares to be 
     covered by each Option and any Rights, the Committee shall take into 
     account the duties of the respective persons, their present and 
     potential contributions to the success of the Company and such other 
     factors as the Committee shall deem relevant in connection with 
     accomplishing the purpose of the Plan.  A person to whom an Option has 
     been granted hereunder is sometimes referred to herein as an "Optionee."
     
     An Optionee shall be eligible to receive more than one grant of an 
     Option during the term of the Plan, but only on the terms and subject 
     to the restrictions hereinafter set forth.

5.   STOCK.

     The stock subject to Options and Rights hereunder shall be shares of the
     Company's common stock, par value $0.01 per share ("Common Stock").  Such
     shares may, in whole or in part, be authorized but unissued shares or
     shares that shall have been or that may be reacquired by the Company.  The
     aggregate number of shares of Common Stock as to which Options and Rights
     may be granted from time to time under the Plan shall not exceed 1,000,000.
     The limitation established by the preceding sentence shall be subject to
     adjustment as provided in Section 8(h) hereof.

     In the event that any outstanding Option under the Plan for any reason
     expires or is terminated without having been exercised in full or without
     having been surrendered in full in connection with the exercise of a Right,
     the shares of Common Stock allocable to the unexercised portion of such
     Option shall (unless the Plan shall have been terminated) become available
     for subsequent grants of Options and Rights under the Plan.

6.   INCENTIVE STOCK OPTIONS.

     Options granted pursuant to this Section 6 are intended to constitute
     Incentive Stock Options and shall be subject to the following special terms
     and conditions, in addition to the general terms and conditions specified
     in Section 8 hereof.


<PAGE>

                                                                         Page 6

     (a)  VALUE OF SHARES.  The aggregate Fair Market Value (determined as of
          the date the Incentive Stock Option is granted) of the shares of
          Common stock with respect to which Options granted under this Plan and
          all other option plans of the Company, any Parent Corporation and any
          Subsidiary Corporation become exercisable for the first time by an
          Optionee during any calendar year shall not exceed $100,000.

     (b)  TEN PERCENT STOCKHOLDER.  In the case of an Incentive Stock Option
          granted to a Ten Percent Stockholder, (i) the Option Price shall not
          be less than one hundred ten percent of the Fair Market Value of a
          share of Common Stock of the Company on the date of grant of such
          Incentive Stock Option, and (ii) the exercise period shall not exceed
          five years from the date of grant of such Incentive Stock Options.

7.   NONQUALIFIED STOCK OPTIONS.

     Options granted pursuant to this Section 7 are intended to constitute
     Nonqualified Stock Options and shall be subject only to the general terms
     and conditions specified in Section 8 hereof.

8.   TERMS AND CONDITIONS OF OPTIONS.

     Each Option granted pursuant to the Plan shall be evidenced by a written
     Option Agreement between the company and the Optionee, which agreement
     shall comply with and be subject to the following terms and conditions:

     (a)  NUMBER OF SHARES.   Each Option Agreement shall state the number of
          shares of Common Stock to which the Option relates.  The maximum
          number of shares that can be granted to an Optionee in a particular
          calendar year is 150,000 shares.

     (b)  OPTION PRICE.  Each Option Agreement shall state the Option Price per
          share of Common Stock, which, in the case of Incentive Stock Options,
          shall be not less than one hundred percent of the Fair Market Value of
          a share of Common Stock of the Company on the date of grant of the
          Option.  The Option Price shall be subject to adjustment as provided
          in Section 8(h) hereof.  The date on which the Committee adopts a
          resolution expressly granting an Option shall be considered the day on
          which such Option is granted, unless a subsequent date is specified in
          such resolution.

     (c)  MEDIUM AND TIME OF PAYMENT.  The Option Price shall be paid in full,
          at the time of exercise, in cash or in shares of Common Stock having a
          Fair Market Value equal to such Option Price or in a combination of
          cash and 


<PAGE>

                                                                         Page 7


          such shares, and may be effected in whole or in part (i) with 
          monies borrowed from the Company pursuant to repayment terms and 
          conditions as shall be determined from time to time by the 
          Committee, in its discretion, separately with respect to each 
          exercise of Options and each Optionee; provided, however, that each 
          such method and time for payment and each such borrowing and terms 
          and conditions of security, if any, and repayment shall be 
          permitted by and be in compliance with applicable law.


<PAGE>

                                                                         Page 8

     (d)  TERM AND EXERCISE OF OPTIONS.  Options shall be exercisable over the
          exercise period as and at the times and upon the conditions that the
          Committee may determine, as reflected in the Option Agreement;
          provided, however, that the Committee shall have the authority to
          accelerate the exercisability of any outstanding Option at such time
          and under such circumstances as it, in its sole discretion, deems
          appropriate.  The exercise period shall be determined by the
          Committee; provided, however, that in the case of an Incentive Stock
          Option, such exercise period shall not exceed ten years from the date
          of grant of such Incentive Stock Option.  The exercise period shall be
          subject to earlier termination as provided in Section 8(e) and 8(f)
          hereof.  An Option may be exercised, as to any or all full shares of
          Common Stock as to which the Option has become exercisable, by giving
          written notice of such exercise to the Committee; provided, however,
          that an Option may not be exercised at any time as to fewer than one
          hundred shares (or such number of shares as to which the Option is
          then exercisable if such number of shares is less than one hundred).

     (e)  TERMINATION OF EMPLOYMENT.  Except as provided in this Section 8(e)
          and in Section 8(f) hereof, an Option may not be exercised unless
          the Optionee is then in the employ of (1) the Company, (2) an
          Affiliate Corporation or (3) a corporation issuing or assuming the
          Option in a transaction to which Section 424(a) of the Code applies or
          a parent corporation or subsidiary corporation of the corporation
          described in this Clause 3, and unless the Optionee has remained
          continuously so employed since the date of grant of the Option.  In
          the event that the employment of an Optionee shall terminate (other
          than by reason of death, Disability or retirement), all Options of
          such Optionee that are exercisable at the time of such termination
          may, unless earlier terminated in accordance with their terms, be
          exercised within three months after such termination.  Nothing in the
          Plan or in any Option or Right granted pursuant hereto shall confer
          upon an individual any right to continue in the employ of the Company
          or any of its Affiliate Corporations or interfere in any way with the
          right of the Company or any such Affiliate Corporation to terminate
          such employment at any time.

     (f)  DEATH, DISABILITY OR RETIREMENT OF OPTIONEE.  If an Optionee shall die
          while employed by the Company or an Affiliate Corporation, or within
          three months after the termination of such Optionee's employment, or
          if the Optionee's employment shall terminate by reason of Disability
          or retirement, all Options previously granted to such Optionee, except
          those that have previously terminated, or those that have been
          exercised, may be exercised by the Optionee or by the person or
          persons to whom the Optionee's rights pass, at any time within one
          year after the date of death, 


<PAGE>

                                                                         Page 9

          Disability or retirement of the Optionee.

     (g)  NONTRANSFERABILITY OF OPTIONS.  The Options are nontransferable except
          (1) by will or by laws of descent and distribution, or (2) as
          specifically provided below.  The Optionee may transfer Nonqualified
          Stock Options to members of his or her Immediate Family (as defined
          below) (any such transferee, "Permitted Transferee") if the Optionee
          does not receive any consideration for the transfer.  "Immediate
          Family" refers to children, grandchildren, and spouse of the Optionee
          or one or more trusts solely for the benefit of such family members,
          or partnerships in which such family members are the only partners. 
          "Affiliate" refers to any person that directly, or indirectly through
          one or more intermediaries, controls, or is controlled by, or is under
          common control with, the Optionee.  Options may be exercised during
          the lifetime of the Optionee, only by the Optionee, or by the guardian
          or legal representative of the Optionee or the Permitted Transferee as
          described in this Section 8(h).  The Optionee shall give notice to the
          Company of any transfer hereunder as soon as practicable following the
          date of such transfer.  Any such Permitted Transferee must agree in
          writing to be bound by all the provisions of the Option Agreement
          relating to such transferred option, and the Company must be given a
          copy of such instrument.

     (h)  EFFECT OF CERTAIN CHANGES.

          (1)  If there is any change in the number of shares of Common Stock
               through the declaration of stock dividends, or through
               recapitalization resulting in stock splits, or combinations or
               exchanges of such shares, the number of shares of Common Stock
               available for Options and Rights, the number of shares covered by
               outstanding Options and Rights, THE MAXIMUM NUMBER OF SHARES THAT
               CAN BE GRANTED TO AN OPTIONEE IN A PARTICULAR CALENDAR YEAR, and
               the price per share of such Options or the applicable market
               value of Rights, shall be proportionately adjusted by the
               Committee to reflect any increase or decrease in the number of
               issued shares of Common Stock.

          (2)  In the event of a change in the Common Stock of the Company as
               presently constituted, which is limited to a change of all of its
               authorized shares with par value into the same number of shares
               with a different par value or without par value, the shares
               resulting from any such change shall be deemed to be the Common
               Stock within the meaning of the Plan.

          (3)  To the extent that the foregoing adjustments relate to stock or


<PAGE>

                                                                        Page 10

               securities of the Company, such adjustments shall be made by the
               Committee, whose determination in that respect shall be final,
               binding and conclusive, provided that each Incentive Stock Option
               granted pursuant to this Plan shall not be adjusted in a manner
               that causes such option to fail to continue to qualify as an
               Incentive Stock Option within the meaning of Section 422 of the
               Code.

          (4)  In the event of a Change of Control (as defined in Section 2(c)
               above), all previously granted options, except those that have
               been previously terminated or exercised, become immediately
               exercisable by an Optionee or an Optionee's transferee.

     (i)  RIGHTS AS A STOCKHOLDER.  An Optionee or a transferee of an Option
     shall have no rights as a stockholder with respect to any shares covered by
     the Option until the date of the issuance of a stock certificate to him for
     such shares.  No adjustment shall be made for dividends (ordinary or
     extraordinary, whether in cash, securities or other property) or
     distribution of other rights for which the record date is prior to the date
     such stock certificate is issued, except as provided in Section 8(h)
     hereof.

     (j)  OTHER PROVISIONS.  The Option Agreements authorized under the Plan
     shall contain such other provisions, including, without limitations, (i)
     the granting of Rights, (ii) the imposition of restrictions upon the
     exercise of an Option, and (iii) in the case of an Incentive Stock Option,
     the inclusion of any condition not inconsistent with such Options
     qualifying as Incentive Stock Options, as the Committee shall deem
     advisable.

     9.   STOCK APPRECIATION RIGHTS.

     (a)  GRANT AND EXERCISE.  Rights may be granted either alone ("Free
          Standing Rights") or in conjunction with all or part of any Stock
          Option granted under the Plan ("Related Rights").  In the case of a
          Nonqualified Stock Option, Related Rights may be granted either at or
          after the time of the grant of such Stock Option.  In the case of an
          Incentive Stock Option, Related Rights may be granted only at the time
          of the grant of the Incentive Stock Option.

          A Related Right or applicable portion thereof granted with respect to
          a given Stock Option shall terminate and no longer be exercisable upon
          the termination or exercise of the related Stock Option, except that,
          unless otherwise provided by the Committee at the time of grant, a
          Related Right granted with respect to less than the full number of
          shares covered by a related Stock Option shall only be reduced if and
          to the extent that the number of shares covered by the exercise of
          termination of the related 


<PAGE>

                                                                        Page 11

          Stock Option exceeds the number of shares not covered by the Right.

          A Related Right may be exercised by an Optionee, in accordance with 
          paragraph (b) of this Section 9, by surrendering the applicable 
          portion of the related Stock Option.  Upon such exercise and 
          surrender, the Optionee shall be entitled to receive an amount 
          determined in the manner prescribed in paragraph (b) of this 
          Section 9. Stock Options which have been so surrendered, in whole 
          or in part, shall no longer be exercisable to the extent the 
          Related Rights have been exercised.

     (b)  TERMS AND CONDITIONS.  Rights shall be subject to such terms and
          conditions, not inconsistent with the provisions of the Plan, as shall
          be determined from time to time by the Committee, including the
          following:

               (1)  Rights which are Related Rights shall be exercisable only at
                    such time or times and to the extent that the Options to
                    which they relate shall be exercisable in accordance with
                    the provisions of Sections 6, 7, 8 and this Section 9 of the
                    Plan; provided, however, that any Related Right shall not be
                    exercisable during the first six months of the term of the
                    Related Right, except that this additional limitation shall
                    not apply in the event of death or Disability of the
                    Optionee prior to the expiration of the six-month period.

               (2)  Upon the exercise of a Related Right, an Optionee shall be
                    entitled to receive up to, but not more than, an amount in
                    cash or shares of Common Stock equal in value to the excess
                    of the Fair Market Value as of the date of exercise of one
                    share of Common Stock over the option price per share
                    specified in the related Option multiplied by the number of
                    shares 'in respect of which the Related Right shall have
                    been exercised, with the Committee having the right to
                    determine the form of payment.

               (3)  Related Rights shall be transferable only when and to the
                    extent that the underlying Option would be transferable
                    under paragraph (g) of Section 8 of the Plan.

               (4)  Upon the exercise of a Related Right, the Option or part
                    thereof to which such Related Right is related shall be
                    deemed to have been exercised for the purpose of the
                    limitation set forth in Section 5 of the Plan on the number
                    of shares of Common Stock to be issued under the Plan, but
                    only to the extent of the number of shares issued under the
                    Related Right.

               (5)  [Not used]

               (6)  Rights which are Free Standing Rights 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 Free Standing Rights
                    shall not be exercisable during the first 


<PAGE>

                                                                        Page 12

                    six months of the term of the Free Standing Right, except 
                    that this limitation shall not apply in the event of death 
                    or Disability of the recipient of the Free Standing Right 
                    prior to the expiration of the six-month period.

               (7)  The term of each Free Standing Right shall be fixed by the
                    Committee, but no Free Standing Right shall be exercisable
                    more than ten years after the date such right is granted.

               (8)  Upon the exercise of a Free Standing Right, a recipient
                    shall be entitled to receive up to, but not more than, an
                    amount in cash or shares of Common Stock equal in value to
                    the excess of the Fair Market Value as of the date of
                    exercise of one share of Common Stock over the price per
                    share specified in the Free Standing Right (which shall be
                    no less than one hundred percent of the Fair Market Value of
                    the Common Stock on the date of grant) multiplied by the
                    number of shares in respect to which the Right is being
                    exercised, with the Committee having the right to determine
                    the form of payment.

               (9)  Free Standing Rights shall be transferable to the same
                    extent and subject to the same conditions as set forth in
                    Section 8(g) of the Plan.

               (10) In the event of the termination of employment of a recipient
                    of a Free Standing Right, such Right shall be exercisable to
                    the same extent that an Option would have been exercisable
                    in the event of the termination of employment of an
                    Optionee.


<PAGE>

                                                                        Page 13

10.  AGREEMENT BY OPTIONEE REGARDING WITHHOLDING TAXES.

     If the Committee shall so require, as a condition of exercise, each
     Optionee shall agree that

     (a)  no later than the date of exercise of any Option or Right granted
          hereunder, the Optionee will pay to the Company or make arrangements
          satisfactory to the Committee regarding payment of any Federal, state
          or local taxes of any kind required by law to be withheld upon the
          exercise of such Option or Right; and

     (b)  the Company shall, to the extent permitted or required by law, have
          the right to deduct from any payment of any kind otherwise due to the
          Optionee, Federal, state and local taxes of any kind required by law
          to be withheld upon the exercise of such Option or Right.

11.  TERM OF PLAN.

     Options and Rights may be granted pursuant to the Plan from time to time
     within a period of ten years from the date the Plan is adopted by the
     Board.

12.  AMENDMENT AND TERMINATION OF THE PLAN.

     The Board at any time and from time to time may suspend, terminate, modify
     or amend the Plan.  Except as provided in Section 8 hereof, no suspension,
     termination, modification or amendment of the Plan may adversely  affect
     any Option or Right previously granted, unless the written consent of the
     Optionee is obtained.

13.  APPROVAL OF STOCKHOLDERS.

     The Plan shall take effect upon its adoption by the Board of Directors but
     shall be subject to the approval of the holders of a majority of the issued
     and outstanding shares of Common Stock of the Company, which approval must
     occur within twelve months after the date the Plan is adopted by the Board.

14.  EFFECT OF HEADINGS.

     The section and subsection headings contained herein are for convenience
     only and shall not affect the construction hereof.


August 8, 1997