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                                                                 EXHIBIT 10.4(b)
                                 CITATION CORPORATION

                           NON-QUALIFIED STOCK OPTION PLAN
                              FOR NON-EMPLOYEE DIRECTORS

                    AS APPROVED BY SHAREHOLDERS FEBRUARY 22, 1996

1.  PURPOSE

    This Non-Qualified Stock Option Plan for Non-Employee Directors (the
"Plan") is intended to enable Citation Corporation, a Delaware corporation (the
"Company"), to attract and retain capable non-employee Directors to the service
of the Company and to provide them with incentives to promote the best interests
of the Company by enabling them and encouraging them, through the grant of stock
options, to acquire Company stock.  Options to acquire Common Stock under this
Plan are sometimes hereinafter referred to individually as an "Option" and,
collectively as the "Options."

2.  ADMINISTRATION

    The Plan shall be administered by the Compensation Committee of the Board
of Directors (the "Committee"), which shall consist of at least two members of
the Board of Directors.  It is intended that this Plan shall constitute a
"formula award" plan within the meaning of Rule 16b-3(c)(2)(ii) under the
Securities Exchange Act of 1934, as amended (the "Act"); if for any reason it
shall be determined that this Plan does not constitute a formula award plan, or
if for any other reason the Board of Directors may consider it advisable, the
Committee shall consist solely of directors who are "disinterested persons"
within the meaning of Rule 16b-3(c)(2)(i) under the Act.

    The Committee shall have the authority to establish, from time to time,
such rules and regulations, not inconsistent with the provisions of the Plan,
for the proper administration of the Plan, and to make such determinations and
interpretations under or in connection with the Plan and the Options granted
hereunder as it deems necessary or advisable.  All such rules, regulations,
determinations and interpretations shall be binding and conclusive upon the
Company, its shareholders, and directors of the Company and upon their
respective legal representatives, beneficiaries, successors and assigns and upon
all other persons claiming under or through any of them.

3.  ELIGIBILITY

    The Directors eligible to participate in the Plan shall be those Directors
of the Company or any of its subsidiaries who are not employed by the Company or
its subsidiaries.  The Directors eligible to receive options under the Plan are
hereinafter referred to as "Eligible Individuals."

4.  STOCK SUBJECT TO THE PLAN

    Subject to the provisions of Section 7 hereof, 100,000 shares of the
Company's Common Stock, par value $.01 per share (the "Shares"), shall be
available for the grant of Options under the Plan.  Shares issuable under the
Plan may be authorized but unissued Shares or reacquired Shares,

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as the Board shall determine.

    If any Option granted under the Plan expires or otherwise terminates, in
whole or in part, without having been exercised, the Shares subject to the
unexercised portion of such Option shall be available for the granting of
Options under the Plan as fully as if such Shares had never been subject to an
Option.

5.  GRANTS, TERMS AND CONDITIONS OF OPTIONS

    Each Eligible Individual shall automatically be granted an Option to
purchase 10,000 Shares on the first Grant Date occurring on or after such
Eligible Individual first became a Director of the Company.  A "Grant Date" is
either (a) thirty (30) days (or the first business day following the 30th day)
after the date this Plan is adopted by the Board of Directors; or (b) the date
on which an Eligible Individual first became a Director of the Company.  Options
granted pursuant to this Plan shall be subject to the following terms and
conditions, and such further terms and conditions as are not inconsistent with
the provisions of this Plan, as determined by the Committee.

         (a)  PRICE.  The option price per Share under each Option granted
    under the Plan shall be the Fair Market Value of the Shares on the date of
    grant of such Option. "Fair Market Value" means the average between the
    last reported highest and the lowest selling prices quoted on the NASDAQ
    National Market System, or other principal exchange on which the Common
    Stock is traded, on the pertinent date.

         (b)  TERM.  The duration of each Option shall be five (5) years from
    the date of grant (the "Expiration Date").

         (c)  EXERCISE AND PAYMENT.  Each Option granted to each Optionee shall
    become immediately exercisable in whole or in part, subject to Section 5(h)
    hereafter.  An Option shall be exercised in the manner set forth in the
    Option Agreement (as defined in Section 5(h) hereafter) relating thereto
    and payment in full for all Shares being purchased at the time shall be
    made coincidentally therewith.  Such payment shall be in United States
    dollars effected by means of cash, certified check or bank draft.
    Alternatively, such payment may be made, in whole or in part, in Shares of
    Common Stock of the Company, and any such Shares so tendered in payment
    shall be valued for such purpose at the then Fair Market Value.

         (d)  CESSATION OF SERVICE OF A LIVING OPTIONEE:  In all cases of
    cessation of service as a Director of a living Optionee, the Optionee must
    exercise his Options within ninety (90) days after the date he ceases to be
    a Director of the Company or its subsidiary, or such Options shall
    automatically terminate.

         (e)  DEATH OF OPTIONEE.  If an Optionee dies prior to the Expiration
    Date of his Option, such Option may be exercised, by the Optionee's estate,
    personal representative or beneficiary who acquired the right to exercise
    such Option by bequest or inheritance or by reason of the death of the
    Optionee, to the extent of the number of Shares with respect to which the
    Optionee could have exercised it on the date of his death, at any time
    prior to the earlier of (i) one (1) year following the date of the
    Optionee's death, or (ii) the Expiration Date of such Option. In the event
    of the death of an Optionee, a condition of exercising any

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    Option shall be the delivery to the Company of such tax waivers and other
    documents as the Committee shall determine to be necessary or desirable.

         (f)  TRANSFERABILITY.  No Option shall be assignable or transferable
    by an Optionee otherwise than by will or by the laws of descent and
    distribution, or pursuant to a qualified domestic relations order as
    defined by the Internal Revenue Code of 1986, as amended, or Title I of the
    Employee Retirement income Security Act, or the rules thereunder, and
    during the lifetime of the Optionee, the Option shall be exercisable only
    by him, or in the event of his legal disability, by his legal
    representative.

         (g)  RIGHTS AS A SHAREHOLDER.  An Optionee shall have no rights as a
    shareholder with respect to any Shares covered by his Option until the
    issuance of a stock certificate to him representing such Shares.

         (h)  SEQUENTIAL EXERCISE OF OPTIONS.  Options granted under the plan
    shall be exercisable at the discretion of the Optionee without regard to
    the price or the date of grant of any other outstanding Option which was
    granted under this Plan or any other plan of the Company or a related
    corporation, or a predecessor of the Company or a related corporation
    before or after the granting of such Option to the same Optionee to
    purchase Shares, or to purchase stock in a corporation which (at the time
    of granting of such option) was a related corporation or to purchase stock
    in a predecessor corporation of the Company or a related corporation.

         (i)  OPTION AGREEMENT AND FURTHER CONDITIONS.  As soon as practicable
    after the grant of an option, each Optionee shall enter into, and be bound
    by the terms of, a stock option agreement (the "Option Agreement") which
    shall state the exercise price of the Options granted, and such other terms
    and conditions as the Committee shall determine and as are not inconsistent
    with this Plan.  It is specifically contemplated that, in order to
    facilitate compliance with Rule 16b-3 under the Act and notwithstanding the
    immediate exercisability set forth in Section 5(c) above, Option Agreements
    may delay exercisability until the expiration of six months after the date
    of grant, or may require such other holding period as may be necessary or
    desirable under federal securities or tax laws.

         (j)  WITHHOLDING.  The obligation of the Company to deliver Shares
    upon the exercise of any Option shall be subject to any applicable federal,
    state and local tax withholding requirements.

         (k)  NO OBLIGATION TO EXERCISE OPTION.  The granting of an Option
    shall impose no obligation upon an Optionee to exercise such Option.

6.  INVESTMENT PURPOSES

    Each Optionee, or his legal representative or beneficiaries, may be
required to give satisfactory assurance that Shares acquired upon exercise of an
Option are being acquired for investment and not with a view to distribution,
and certificates representing such Shares may be legended accordingly.  Such
Shares shall be transferable thereafter only if the proposed transfer is
permissible under the Plan and the Option and if, in the opinion of counsel (who
shall be satisfactory

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to the Company), such transfer shall at such time be in compliance with
applicable securities laws.

7.  ADJUSTMENTS

    The number of Shares and the option price for the Shares covered by each
outstanding Option shall all be proportionately adjusted for any increase or
decrease in the number of Shares of Common Stock resulting from a subdivision or
consolidation of the issued Shares of Common Stock or the payment of a stock
dividend on Common Stock or any other increase or decrease in the number of such
Shares effected without receipt of consideration by the Company.  In the event
of a change in the Company's presently authorized Common Stock which is limited
to a change of all of its presently authorized shares with par value, or any
change of the then authorized shares with par value into the same number of
shares without par value, or any change of the then authorized shares with par
value, the shares resulting from any such change shall be deemed to be Shares of
Common Stock as defined in Section 4.  In the event that the outstanding Shares
of Common Stock of the Company shall be changed into or exchanged for a
different number or kind of shares of stock or other securities of the Company
or of another corporation, whether through reorganization, recapitalization,
stock split-up, combination of shares, sale of assets, merger or consolidation,
whether or not the Company shall be the surviving corporation then, there shall
be substituted for each Share of Common Stock subject to any such Option and for
each Share of Common Stock reserved for issuance pursuant to this Plan but not
yet covered by an Option the number and kind of shares of stock or other
securities into which each outstanding Share of Common Stock shall be so changed
or for which each such Share shall be exchanged.  In the event there shall be
any change, other than as specified above in this Section 7, in the number or
kind of Shares then subject to an Option or Options and of the shares
theretofore reserved for issuance pursuant to this Plan but not yet covered by
an Option, such adjustment shall be made by the Committee and shall be effective
and binding for all purposes of this Plan and of each Option hereunder and each
Stock Option Agreement hereunder entered into in accordance with this Plan.  No
adjustment or substitution provided for in this Section 7 shall require the
Company to buy or sell a fractional share under any Stock Option Agreement, and
the total substitution or adjustment with respect to each Stock Option Agreement
hereunder shall be limited accordingly.

8.  TERMINATION, AMENDMENT OR DISCONTINUANCE OF THE PLAN

         (a)  TERMINATION.  This Plan will terminate not later than June 1,
    2010, and after that date no options may be granted hereunder.  All Options
    outstanding at the time of termination of the Plan shall remain in effect
    until such Options have expired in accordance with their terms, have been
    terminated in accordance with the Plan, or have been terminated by mutual
    consent of the parties.  The Board of Directors in its discretion may
    terminate the Plan at any time with respect to any Shares for which Options
    have not theretofore been granted.

         (b)  AMENDMENT.  The Board of Directors shall have the right to alter
    or amend the Plan or any part thereof from time to time, including, but not
    limited to, such modifications and amendments as shall be in the judgment
    of the Board or the Committee required to satisfy the conditions of Rule
    16b-3 under the Securities Exchange Act of 1934 as it now exists or may
    from time to time be amended and/or superseded, or to conform to any change
    in any law or regulation applicable thereto; provided, however that:

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              (i) no change in any Option theretofore granted may be made which
         would impair the rights of the Optionee without the consent of such
         Optionee;

              (ii) the Board of Directors may not make any alteration or
         amendment which would materially increase the benefits accruing to
         participants under the Plan, increase the aggregate number of Shares
         which may be issued under the Plan (other than increase reflecting a
         stock dividend, stock split, share combination or similar change in
         capitalization of the Company), materially modify the requirements as
         to eligibility for receipt of Options under the Plan, or extend the
         term of the Plan, without the approval of the shareholders of the
         Company; and

              (iii) the Board of Directors may not amend this Plan more than
         once every six months, other than to comport with changes in the
         Internal Revenue Code, the Employee Retirement Income Security Act, or
         regulations thereunder.

9.  ABSENCE OF RIGHTS

    The granting of an Option to an Eligible Director shall confer no rights of
any sort except such rights as are contained in this Plan and the Option
Agreement.

10. INDEMNIFICATION AND EXCULPATION

         (a)  Each person who is or shall have been a member of the Board of
    Directors or of the Committee shall be indemnified and held harmless by the
    Company against and from any and all loss, cost, liability or expense that
    may be imposed upon or reasonably incurred by him in connection with or
    resulting from any claim, action, suit or proceeding to which he may be a
    party or in which he may be involved by reason of any action taken or
    failure to act under this Plan and against and from any and all amounts
    paid by him in settlement thereof (with the Company's written approval) or
    paid by him in satisfaction of a judgment in any such action, suit or
    proceeding, except a judgment in favor of the Company based upon a finding
    of his bad faith; subject, however, to the condition that upon the
    institution of any such claim, action, suit or proceeding against him, he
    shall in writing give the Company an opportunity, at its own expense, to
    handle and defend the same before he undertakes to handle and defend it on
    his behalf.  The foregoing right of indemnification shall not be exclusive
    of any other right to which such person may be entitled as a matter of law
    or otherwise, or any power that the Company may have to indemnify him or
    hold him harmless.

         (b)  Each member of the Board of Directors or of the Committee, and
    each officer and employee of the Company shall be fully justified in
    relying or acting upon any information furnished in connection with the
    administration of this Plan by any person or persons other than himself.
    In no event shall any person who is or shall have been a member of the
    Board of Directors or of the Committee, or an officer or employee of the
    Company be liable for any determination made or other action taken or any
    omission to act in reliance upon any such information or for any action
    (including the furnishing of information) taken or any failure to act, if
    in good faith.

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11. APPLICATION OF PROCEEDS

    The proceeds received by the Company from the sale of Common Stock pursuant
to Options will be used for general corporate purposes.

12. PRONOUNS; HEADINGS.

    Wherever any words are used in the masculine gender, they shall be
construed as though they were also used in the feminine gender in all cases
where they would so apply.  Headings used herein are for general information
only and do not constitute part of the Plan.

13. SHAREHOLDER APPROVAL

    This Plan is subject to the approval of the holders of a majority of the
securities of the Company present or represented and entitled to vote at a
meeting duly held in accordance with applicable laws of the State of Delaware.

14. SAVINGS CLAUSE

    Any provision of this Plan which, if given effect, would disqualify any
Option granted hereunder, or Shares issuable upon exercise thereof, from
exemption from the operation of Section 16(b) of the Securities Exchange Act of
1934 shall be null and void and of no effect, and any such provision shall be
deemed not to be a part of this Plan for purposes of construction hereof.


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