Exhibit 10.19


                                  NYMAGIC, INC.
                              AMENDED AND RESTATED
                          2004 LONG-TERM INCENTIVE PLAN

1.      Establishment, Purpose, and Types of Awards

        NYMAGIC, Inc., a New York corporation (the "Company") hereby amends and
restates its incentive compensation plan known as the "NYMAGIC, Inc. 2004
Long-Term Incentive Plan" (hereinafter referred to as the "Plan") effective
December 15, 2004. The Plan's purposes are to attract, retain and motivate
select employees, officers, directors, advisors, and consultants for the Company
and its Affiliates and to provide incentives and awards for superior
performance.

        The Plan permits the granting of the following types of awards
("Awards"), according to the Sections of the Plan listed here:

           Section 6                  Options
           Section 7                  Share Appreciation Rights
           Section 8                  Restricted and Unrestricted Share Awards
           Section 9                  Deferred Share Units
           Section 10                 Performance Awards

        The Plan is not intended to affect and shall not affect any stock
options, equity-based compensation, or other benefits that the Company or its
Affiliates may have provided, or may separately provide in the future pursuant
to any agreement, plan, or program that is independent of this Plan.

2.      Defined Terms

        Terms in the Plan that begin with an initial capital letter have the
defined meaning set forth in Appendix A, unless defined elsewhere in this Plan
or the context of their use clearly indicates a different meaning.

3.      Shares Subject to the Plan

        Subject to the provisions of Section 13 of the Plan, the maximum number
of Shares that the Company may issue is 450,000 Shares for all Awards. These
Shares may be authorized but unissued Shares, or Shares that the Company has
reacquired or otherwise holds in treasury.

        Shares that are subject to an Award that for any reason expires, is
forfeited, is cancelled, or becomes unexercisable, and Shares that are for any
other reason not paid or delivered under the Plan shall again, except to the
extent prohibited by Applicable Law, be available for subsequent Awards under
the Plan. In addition, the Committee may make future Awards with respect to
Shares that the Company retains from otherwise delivering pursuant to an Award
either (i) as payment of the exercise price of an Award, or (ii) in order to
satisfy the withholding or employment taxes due upon the grant, exercise,
vesting, or distribution of an Award. Notwithstanding the foregoing, but subject
to adjustments pursuant to Section 13 below, the number of Shares that are
available for ISO Awards shall be determined, to the extent required under
applicable tax laws, by reducing the number of Shares designated in the
preceding paragraph by the number of Shares granted pursuant


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to Awards (whether or not Shares are issued  pursuant to such Awards);  provided
that any Shares that are either  purchased  under the Plan and forfeited back to
the Plan, or  surrendered in payment of the Exercise Price for an Award shall be
available for issuance pursuant to ISO Awards.

4.      Administration

        (a) General. The Committee shall administer the Plan in accordance with
its terms, provided that the Board may act in lieu of the Committee on any
matter. The Committee shall hold meetings at such times and places as it may
determine and make such rules and regulations for the conduct of its business as
it deems advisable. In the absence of a duly appointed Committee or if the Board
otherwise chooses to act in lieu of a Committee, the Board shall function as the
Committee for all purposes of the Plan.

        (b) Committee Composition. The Board shall appoint the members of the
Committee. If and to the extent permitted by Applicable Law, the Committee may
authorize one or more Reporting Persons (or other officers) to make Awards to
Eligible Persons who are not Reporting Persons (or other officers whom the
Committee has specifically authorized to make Awards). The Board may at any time
appoint additional members to the Committee, remove and replace members of the
Committee with or without Cause, and fill vacancies on the Committee however
caused.

        (c) Powers of the Committee. Subject to the provisions of the Plan, the
Committee shall have the authority, in its sole discretion:

                (i) to determine Eligible Persons to whom Awards shall be
        granted from time to time and the number of Shares, units, or SARs to be
        covered by each Award;

                (ii) to determine, from time to time, the Fair Market Value of
        Shares;

                (iii) to determine, and to set forth in Award Agreements, the
        terms and conditions of all Awards, including any applicable exercise or
        purchase price, the installments and conditions under which an Award
        shall become vested (which may be based on performance), terminated,
        expired, cancelled, renewed or replaced, and the circumstances for
        vesting acceleration or waiver of forfeiture restrictions, and other
        restrictions and limitations;

                (iv) to approve the forms of Award Agreements and all other
        documents, notices and certificates in connection therewith which need
        not be identical either as to type of Award or among Participants;

                (v) to construe and interpret the terms of the Plan and any
        Award Agreement, to determine the meaning of their terms, and to
        prescribe, amend, and rescind rules and procedures relating to the Plan
        and its administration; and

                (vi) in order to fulfill the purposes of the Plan and without
        amending the Plan, modify, cancel, or waive the Company's rights with
        respect to any Awards, to adjust or to modify Award Agreements for
        changes in Applicable Law, and to recognize differences in foreign law,
        tax policies, or customs; and



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                (vii) to make all other interpretations and to take all other
        actions that the Committee may consider necessary or advisable to
        administer the Plan or to effectuate its purposes.

        Subject to Applicable Law and the restrictions set forth in the Plan,
the Committee may delegate administrative functions to individuals who are
Reporting Persons, officers, or Employees of the Company or its Affiliates.

        (d) Deference to Committee Determinations. The Committee shall have the
discretion to interpret or construe ambiguous, unclear, or implied (but omitted)
terms in any fashion it deems to be appropriate in its sole discretion, and to
make any findings of fact needed in the administration of the Plan or Award
Agreements. The Committee's prior exercise of its discretionary authority shall
not obligate it to exercise its authority in a like fashion thereafter. The
Committee's interpretation and construction of any provision of the Plan, or of
any Award or Award Agreement, shall be final, binding, and conclusive. The
validity of any such interpretation, construction, decision or finding of fact
shall not be given de novo review if challenged in court, by arbitration, or in
any other forum, and shall be upheld unless clearly arbitrary or capricious.

        (e) No Liability; Indemnification. Neither the Board nor any Committee
member, nor any Person acting at the direction of the Board or the Committee,
shall be liable for any act, omission, interpretation, construction or
determination made in good faith with respect to the Plan, any Award or any
Award Agreement. The Company and its Affiliates shall pay or reimburse any
member of the Committee, as well as any Director, Employee, or Consultant who
takes action in connection with the Plan, for all expenses incurred with respect
to the Plan, and to the full extent allowable under Applicable Law shall
indemnify each and every one of them for any claims, liabilities, and costs
(including reasonable attorney's fees) arising out of their good faith
performance of duties under the Plan. The Company and its Affiliates may obtain
liability insurance for this purpose.

5.      Eligibility

        (a) General Rule. The Committee may grant ISOs only to Employees
(including officers who are Employees), and may grant all other Awards to any
Eligible Person. A Participant who has been granted an Award may be granted an
additional Award or Awards if the Committee shall so determine, if such person
is otherwise an Eligible Person and if otherwise in accordance with the terms of
the Plan.

        (b) Grant of Awards. Subject to the express provisions of the Plan, the
Committee shall determine from the class of Eligible Persons those individuals
to whom Awards under the Plan may be granted, the number of Shares subject to
each Award, the price (if any) to be paid for the Shares or the Award and, in
the case of Performance Awards, in addition to the matters addressed in Section
10 below, the specific objectives, goals and performance criteria that further
define the Performance Award. Each Award shall be evidenced by an Award
Agreement signed by the Company and, if required by the Committee, by the
Participant. The Award Agreement shall set forth the material terms and
conditions of the Award established by the Committee.



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        (c) Limits on Awards. No Participant many receive Options and SARs that
relate to more than 450,000 Shares. The Committee will adjust these limitations
pursuant to Section 13 below.

        (d) Replacement Awards. The Committee may, in its sole discretion and
upon such terms as it deems appropriate, require as a condition of the grant of
an Award to a Participant that the Participant surrender for cancellation some
or all of the Awards that have previously been granted to the Participant under
this Plan or otherwise. An Award that is conditioned upon such surrender may or
may not be the same type of Award, may cover the same (or a lesser or greater)
number of Shares as such surrendered Award, may have other terms that are
determined without regard to the terms or conditions of such surrendered Award,
and may contain any other terms that the Committee deems appropriate. In the
case of Options, these other terms may not involve an Exercise Price that is
lower than the Exercise Price of the surrendered Option unless either the new
grant will not create any material financial expense for the Company or the
Company's shareholders approve the grant itself or the program under which it is
made pursuant to the Plan.

6.      Option Awards

        (a) Types; Documentation. The Committee may in its discretion grant ISOs
to any Employee and Non-ISOs to any Eligible Person, and shall evidence any such
grants in an Award Agreement that is delivered to the Participant. Each Option
shall be designated in the Award Agreement as an ISO or a Non-ISO. At the sole
discretion of the Committee, any Option may be exercisable, in whole or in part,
immediately upon the grant thereof, or only after the occurrence of a specified
event, or only in installments, which installments may vary. Options granted
under the Plan may contain such terms and provisions not inconsistent with the
Plan that the Committee shall deem advisable in its sole and absolute
discretion.

        (b) ISO $100,000 Limitation. To the extent that the aggregate Fair
Market Value of Shares with respect to which Options designated as ISOs first
become exercisable by a Participant in any calendar year (under this Plan and
any other plan of the Company or any Affiliate) exceeds $100,000, such excess
Options shall be treated as Non-ISOs. For purposes of determining whether the
$100,000 limit is exceeded, the Fair Market Value of the Shares subject to an
ISO shall be determined as of the Grant Date. In reducing the number of Options
treated as ISOs to meet the $100,000 limit, the most recently granted Options
shall be reduced first. In the event that Section 422 of the Code is amended to
alter the limitation set forth therein, the limitation of this Section 6(b)
shall be automatically adjusted accordingly.

        (c) Term of Options. Each Award Agreement shall specify a term at the
end of which the Option automatically expires, subject to earlier termination
provisions contained in Section 6(h) hereof; provided, that, the term of any
Option may not exceed ten years from the Grant Date. In the case of an ISO
granted to an Employee who is a Ten Percent Holder on the Grant Date, the term
of the ISO shall not exceed five years from the Grant Date.

        (d) Exercise Price. The exercise price of an Option shall be determined
by the Committee in its discretion and shall be set forth in the Award
Agreement, subject to the following special rules:

                (i) ISOs. If an ISO is granted to an Employee who on the Grant
        Date is a Ten Percent Holder, the per Share exercise price shall not be
        less than 110% of the Fair Market



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        Value per Share on such Grant Date. If an ISO is granted to any other
        Employee, the per Share exercise price shall not be less than 100% of
        the Fair Market Value per Share on the Grant Date.

                (ii) Non-ISOs. The per Share exercise price for the Shares to be
        issued pursuant to the exercise of a Non-ISO shall not be less than 85%
        of the Fair Market Value per Share on the Grant Date, and shall be
        subject to any payment or other restrictions that the Committee may at
        any time impose in order to conform with Section 409A of the Code.

                (iii) Named Executive Officers. The per Share exercise price
        shall not be less than 100% of the Fair Market Value per Share on the
        Grant Date of an Option if (A) on such Grant Date, the Participant is
        subject to the limitations set forth in Section 162(m) of the Code, and
        (B) the grant is intended to qualify as performance-based compensation
        under Section 162(m) of the Code.

                (iv) Repricing. The Committee may at any time unilaterally
        reduce the exercise price for any Option, but only if (I) the reduction
        will not cause material financial expense for the Company, and (II) the
        Committee promptly provides a written notice to any Participant affected
        by the reduction.

        (e) Exercise of Option. The times, circumstances and conditions under
which an Option shall be exercisable shall be determined by the Committee in its
sole discretion and set forth in the Award Agreement. The Committee shall have
the discretion to determine whether and to what extent the vesting of Options
shall be tolled during any unpaid leave of absence; provided, however, that in
the absence of such determination, vesting of Options shall be tolled during any
such leave approved by the Company.

        (f) Minimum Exercise Requirements. An Option may not be exercised for a
fraction of a Share. The Committee may require in an Award Agreement that an
Option be exercised as to a minimum number of Shares, provided that such
requirement shall not prevent a Participant from purchasing the full number of
Shares as to which the Option is then exercisable.

        (g) Methods of Exercise. Prior to its expiration pursuant to the terms
of the applicable Award Agreement, and subject to the times, circumstances, and
conditions for exercisability contained in the applicable Award Agreement, each
Option may be exercised, in whole or in part (provided that the Company shall
not be required to issue fractional shares), by delivery of written notice of
exercise to the secretary of the Company accompanied by the full exercise price
of the Shares being purchased. In the case of an ISO, the Committee shall
determine the acceptable methods of payment on the Grant Date and it shall be
included in the applicable Award Agreement. The methods of payment that the
Committee may in its discretion accept or commit to accept in an Award Agreement
include:

                (i) cash or check payable to the Company (in U.S. dollars);

                (ii) other Shares that (A) are owned by the Participant who is
        purchasing Shares pursuant to an Option, (B) have a Fair Market Value on
        the date of surrender equal to the aggregate exercise price of the
        Shares as to which the Option is being exercised, (C) were not acquired
        by such Participant pursuant to the exercise of an Option, unless such
        Shares have



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        been owned by such Participant for at least six months or such other
        longer period as the Committee may determine, (D) are all, at the time
        of such surrender, free and clear of any and all claims, pledges, liens
        and encumbrances, or any restrictions which would in any manner restrict
        the transfer of such shares to or by the Company (other than such
        restrictions as may have existed prior to an issuance of such Shares by
        the Company to such Participant), and (E) are duly endorsed for transfer
        to the Company;

                (iii) a cashless exercise program that the Committee may
        approve, from time to time in its discretion, pursuant to which a
        Participant may concurrently provide irrevocable instructions (A) to
        such Participant's broker or dealer to effect the immediate sale of the
        purchased Shares and remit to the Company, out of the sale proceeds
        available on the settlement date, sufficient funds to cover the exercise
        price of the Option plus all applicable taxes required to be withheld by
        the Company by reason of such exercise and (B) to the Company to deliver
        the certificates for the purchased Shares directly to such broker or
        dealer in order to complete the sale; or

                (iv) any combination of the foregoing methods of payment.

        The Company shall not be required to deliver Shares pursuant to the
exercise of an Option until payment of the full exercise price therefore is
received by the Company.

        (h) Termination of Continuous Service. The Committee may establish and
set forth in the applicable Award Agreement the terms and conditions on which an
Option shall remain exercisable, if at all, following termination of a
Participant's Continuous Service. The Committee may waive or modify these
provisions at any time. To the extent that a Participant is not entitled to
exercise an Option at the date of his or her termination of Continuous Service,
or if the Participant (or other person entitled to exercise the Option) does not
exercise the Option to the extent so entitled within the time specified in the
Award Agreement or below (as applicable), the Option shall terminate and the
Shares underlying the unexercised portion of the Option shall revert to the Plan
and become available for future Awards. In no event may any Option be exercised
after the expiration of the Option term as set forth in the Award Agreement.

        The following provisions shall apply to the extent an Award Agreement
does not specify the terms and conditions upon which an Option shall terminate
when there is a termination of a Participant's Continuous Service:

                (i) Termination other than Upon Disability or Death or for
        Cause. In the event of termination of a Participant's Continuous Service
        (other than as a result of Participant's death, disability, retirement
        or termination for Cause), the Participant shall have the right to
        exercise an Option at any time within 30 days following such termination
        to the extent the Participant was entitled to exercise such Option at
        the date of such termination.

                (ii) Disability. In the event of termination of a Participant's
        Continuous Service as a result of his or her being Disabled, the
        Participant shall have the right to exercise an Option at any time
        within one year following such termination to the extent the Participant
        was entitled to exercise such Option at the date of such termination.

                (iii) Retirement. In the event of termination of a Participant's
        Continuous Service as a result of Participant's retirement, the
        Participant shall have the right to exercise



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        the Option at any time within six months following such termination to
        the extent the Participant was entitled to exercise such Option at the
        date of such termination.

                (iv) Death. In the event of the death of a Participant during
        the period of Continuous Service since the Grant Date of an Option, or
        within thirty days following termination of the Participant's Continuous
        Service, the Option may be exercised, at any time within one year
        following the date of the Participant's death, by the Participant's
        estate or by a person who acquired the right to exercise the Option by
        bequest or inheritance, but only to the extent the right to exercise the
        Option had vested at the date of death or, if earlier, the date the
        Participant's Continuous Service terminated.

                (v) Cause. If the Committee determines that a Participant's
        Continuous Service terminated due to Cause, the Participant shall
        immediately forfeit the right to exercise any Option, and it shall be
        considered immediately null and void.

        (i) Reverse Vesting. The Plan Administrator in its discretion may allow
a Participant to exercise unvested Options, in which case the Shares then issued
shall be Restricted Share Units having analogous vesting restrictions to the
unvested Options.

        (j) Buyout Provisions. The Committee may at any time offer to buy out an
Option, in exchange for a payment in cash or Shares, based on such terms and
conditions as the Committee shall establish and communicate to the Participant
at the time that such offer is made. In addition, if the Fair Market Value for
Shares subject to an Option is more than 33% below their exercise price for more
than 30 consecutive business days, the Committee may unilaterally terminate and
cancel the Option either (i) by paying the Participant, in cash or Shares, an
amount not less than the Black-Scholes value of the vested portion of the
Option, or (ii) by irrevocably committing to grant a new Option, on a designated
date more than six months after such termination and cancellation of such Option
(but only if the Participant's Continuous Service has not terminated prior to
such designated date), on substantially the same terms as the cancelled Option,
provided that the per Share exercise price for the new Option shall equal the
per Share Fair Market Value of a Share on the date the new grant occurs.

7.      Share Appreciate Rights (SARs)

        (a) Grants. The Committee may in its discretion grant Share Appreciation
Rights to any Eligible Person, in any of the following forms:

                (i) SARs related to Options. The Committee may grant SARs either
        concurrently with the grant of an Option or with respect to an
        outstanding Option, in which case the SAR shall extend to all or a
        portion of the Shares covered by the related Option. An SAR shall
        entitle the Participant who holds the related Option, upon exercise of
        the SAR and surrender of the related Option, or portion thereof, to the
        extent the SAR and related Option each were previously unexercised, to
        receive payment of an amount determined pursuant to Section 7(e) below.
        Any SAR granted in connection with an ISO will contain such terms as may
        be required to comply with the provisions of Section 422 of the Code and
        the regulations promulgated thereunder.



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                (ii) SARs Independent of Options. The Committee may grant SARs
        which are independent of any Option subject to such conditions as the
        Committee may in its discretion determine, which conditions will be set
        forth in the applicable Award Agreement.

                (iii) Limited SARs. The Committee may grant SARs exercisable
        only upon or in respect of a Change in Control or any other specified
        event, and such limited SARs may relate to or operate in tandem or
        combination with or substitution for Options or other SARs, or on a
        stand-alone basis, and may be payable in cash or Shares based on the
        spread between the exercise price of the SAR, and (A) a price based upon
        or equal to the Fair Market Value of the Shares during a specified
        period, at a specified time within a specified period before, after or
        including the date of such event, or (B) a price related to
        consideration payable to Company's shareholders generally in connection
        with the event.

        (b) Exercise Price. The per Share exercise price of an SAR shall be
determined in the sole discretion of the Committee, shall be set forth in the
applicable Award Agreement, and shall be no less than 85% of the Fair Market
Value of one Share. The exercise price of an SAR related to an Option shall be
the same as the exercise price of the related Option. The exercise price of an
SAR shall be subject to the special rules on pricing contained in paragraphs
(iii) and (iv) of Section 6(d) hereof.

        (c) Exercise of SARs. Unless the Award Agreement otherwise provides, an
SAR related to an Option will be exercisable at such time or times, and to the
extent, that the related Option will be exercisable. An SAR may not have a term
exceeding ten years from its Grant Date. An SAR granted independently of any
other Award will be exercisable pursuant to the terms of the Award Agreement.
Whether an SAR is related to an Option or is granted independently, the SAR may
only be exercised when the Fair Market Value of the Shares underlying the SAR
exceeds the exercise price of the SAR.

        (d) Effect on Available Shares. To the extent that an SAR is exercised,
only the actual number of delivered Shares (if any) will be charged against the
maximum number of Shares that may be delivered pursuant to Awards under this
Plan. The number of Shares subject to the SAR and the related Option of the
Participant will, however, be reduced by the number of underlying Shares as to
which the exercise relates, unless the Award Agreement otherwise provides.

        (e) Payment. Upon exercise of an SAR related to an Option and the
attendant surrender of an exercisable portion of any related Award, the
Participant will be entitled to receive payment of an amount determined by
multiplying -

                (i) the excess of the Fair Market Value of a Share on the date
        of exercise of the SAR over the exercise price per Share of the SAR, by

                (ii) the number of Shares with respect to which the SAR has been
        exercised.

        Notwithstanding the foregoing, an SAR granted independently of an Option
(i) may limit the amount payable to the Participant to a percentage, specified
in the Award Agreement but not exceeding one-hundred percent (100%), of the
amount determined pursuant to the preceding sentence, and (ii) shall be subject
to any payment or other restrictions that the Committee may at



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any time impose in its discretion, including restrictions intended in order to
conform the SARs with Section 409A of the Code

        (f) Form and Terms of Payment. Subject to Applicable Law, the Committee
may, in its sole discretion, settle the amount determined under Section 7(e)
above solely in cash, solely in Shares (valued at their Fair Market Value on the
date of exercise of the SAR), or partly in cash and partly in Shares. In any
event, cash shall be paid in lieu of fractional Shares. Absent a contrary
determination by the Committee, all SARs shall be settled in cash as soon as
practicable after exercise. Notwithstanding the foregoing, the Committee may, in
an Award Agreement, determine the maximum amount of cash or Shares or
combination thereof that may be delivered upon exercise of an SAR.

        (g) Termination of Employment or Consulting Relationship. The Committee
shall establish and set forth in the applicable Award Agreement the terms and
conditions on which an SAR shall remain exercisable, if at all, following
termination of a Participant's Continuous Service. The provisions of Section
6(h) above shall apply to the extent an Award Agreement does not specify the
terms and conditions upon which an SAR shall terminate when there is a
termination of a Participant's Continuous Service.

        (h) Repricing and Buy-out. The Committee has the same discretion to
reprice and to buy-out SARs as it has to take such actions with respect to
Options.

8.      Restricted and Unrestricted Share Awards

        (a) Grants. The Committee may in its discretion grant restricted shares
("Restricted Shares") to any Eligible Person and shall evidence such grant in an
Award Agreement that is delivered to the Participant which sets forth the number
of Restricted Shares, the purchase price for such Restricted Shares (if any) and
the terms upon which the Restricted Shares may become vested. In addition, the
Company may in its discretion grant the right to receive Shares after certain
vesting requirements are met ("Restricted Share Units") to any Eligible Person
and shall evidence such grant in an Award Agreement that is delivered to the
Participant which sets forth the number of Shares (or formula, that may be based
on future performance or conditions, for determining the number of Shares) that
the Participant shall be entitled to receive upon vesting and the terms upon
which the Shares subject to a Restricted Share Unit may become vested. The
Committee may condition any Award of Restricted Shares or Restricted Share Units
to a Participant on receiving from the Participant such further assurances and
documents as the Committee may require to enforce the restrictions. In addition,
the Committee may grant Awards hereunder in the form of unrestricted Shares
("Unrestricted Shares"), which shall vest in full upon the date of grant or such
other date as the Committee may determine and which the Committee may issue
pursuant to any program under which one or more Eligible Persons (selected by
the Committee in its discretion) elect to receive Unrestricted Shares in lieu of
cash bonuses that would otherwise be paid.

        (b) Vesting and Forfeiture. The Committee shall set forth in an Award
Agreement granting Restricted Shares or Restricted Share Units, the terms and
conditions under which the Participant's interest in the Restricted Shares or
the Shares subject to Restricted Share Units will become vested, but shall not
in the absence of extraordinary circumstances provide for the vesting of these
Awards at a rate more favorable to the Participant than with respect to 25% of
the underlying Shares per year of Continuous Service after the date of the
Award. Except as set forth in the applicable Award



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Agreement or the Committee otherwise determines, upon termination of a
Participant's Continuous Service for any other reason, the Participant shall
forfeit his or her Restricted Shares and Restricted Share Units; provided that
if a Participant purchases the Restricted Shares and forfeits them for any
reason, the Company shall return the purchase price to the Participant only if
and to the extent set forth in an Award Agreement.

        (c) Issuance of Restricted Shares Prior to Vesting. The Company shall
issue stock certificates that evidence Restricted Shares pending the lapse of
applicable restrictions, and that bear a legend making appropriate reference to
such restrictions. Except as set forth in the applicable Award Agreement or the
Committee otherwise determines, the Company or a third party that the Company
designates shall hold such Restricted Shares and any dividends that accrue with
respect to Restricted Shares pursuant to Section 8(e) below.

        (d) Issuance of Shares upon Vesting. As soon as practicable after
vesting of a Participant's Restricted Shares (or Shares underlying Restricted
Share Units) and the Participant's satisfaction of applicable tax withholding
requirements, the Company shall release to the Participant, free from the
vesting restrictions, one Share for each vested Restricted Share (or issue one
Share free of the vesting restriction for each vested Restricted Share Unit),
unless an Award Agreement provides otherwise. No fractional shares shall be
distributed, and cash shall be paid in lieu thereof.

        (e) Dividends payable on Vesting. Whenever Shares are issued to a
Participant or duly-authorized transferee under Section 8(d) above pursuant to
the vesting of Restricted Shares or the Shares underlying Restricted Share
Units, such Participant or duly-authorized transferee shall also be entitled to
receive, with respect to each Share issued, an amount equal to any cash
dividends (plus simple interest at a rate of five percent per annum, or such
other reasonable rate as the Committee may determine) and a number of Shares
equal to any stock dividends, which were declared and paid to the holders of
Shares between the Grant Date and the date such Share is issued.

        (f) Section 83(b) Elections. If a Participant who has received
Restricted Share Units provides the Committee with written notice of his or her
intention to make an election under Section 83(b) of the Code with respect to
the Shares subject to such Restricted Share Units (the "Section 83(b)
Election"), the Committee may in its discretion convert the Participant's
Restricted Share Units into Restricted Shares, on a one-for-one basis, in full
satisfaction of the Participant's Restricted Share Unit Award.

        (g) Deferral Elections. At any time within the thirty-day period (or
other shorter or longer period that the Committee selects) within which a
Participant who is a member of a select group of management or highly
compensated employees (within the meaning of the Code) receives an Award of
either Restricted Shares or Restricted Share Units, the Committee may permit the
Participant to irrevocably elect, on a form provided by and acceptable to the
Committee, to defer the receipt of all or a percentage of the Shares that would
otherwise be transferred to the Participant upon the vesting of such Award. If
the Participant makes this election, the Shares subject to the election, and any
associated dividends and interest, shall be credited to an account established
pursuant to Section 9 hereof on the date such Shares would otherwise have been
released or issued to the Participant pursuant to Section 8(d) above.
Notwithstanding the foregoing, Shares with respect to which a Participant makes
a Section 83(b) Election shall not be eligible for deferral pursuant to Section
9 below.



                                      -10-
<PAGE>



9.      Deferred Share Units

        (a) Elections to Defer. The Committee may permit any Eligible Person who
is a Director, Consultant or member of a select group of management or highly
compensated employees (within the meaning of the Code) to irrevocably elect, on
a form provided by and acceptable to the Committee (the "Election Form"), to
forego the receipt of cash or other compensation (including Restricted Shares
for which a Section 83(b) Election has not been made, and Shares subject to
Restricted Share Units), and in lieu thereof to have the Company credit to an
internal Plan account (the "Account") a number of deferred share units
("Deferred Share Units") having a Fair Market Value equal to the Shares and
other compensation deferred. These credits will be made at the end of each
calendar month during which compensation is deferred. Each Election Form shall
take effect on the first day of the next calendar year (or on the first day of
the next calendar month in the case of an initial election by a Participant who
is first eligible to defer hereunder) after its delivery to the Company, subject
to Section 8(g) regarding deferral of Restricted Shares and Restricted Share
Units and to Section 10(d) regarding deferral of Performance Awards, unless
during such five business day period the Company sends the Participant a written
notice explaining why the Election Form is invalid. Notwithstanding the
foregoing sentence: (i) Election Forms shall be ineffective with respect to any
compensation that a Participant earns before the date on which the Company
receives the Election Form, and (ii) the Committee may unilaterally make awards
in the form of Deferred Share Units, regardless of whether or not the
Participant foregoes other compensation.

        (b) Vesting. Each Participant shall be 100% vested at all times in any
Shares subject to Deferred Share Units.

        (c) Issuances of Shares. The Company shall provide a Participant with
one Share for each Deferred Share Unit in five substantially equal annual
installments that are issued before the last day of each of the five calendar
years that end after the date on which the Participant's Continuous Service
terminates, unless -

                (i) the Participant has properly elected a different form of
        distribution, on a form approved by the Committee, that permits the
        Participant to select any combination of a lump sum and annual
        installments that are completed within ten years following termination
        of the Participant's Continuous Service, and

                (ii) the Company received the Participant's distribution
        election form at the time the Participant elects to defer the receipt of
        cash or other compensation pursuant to Section 9(a), provided that such
        election may be changed through any subsequent election that (i) is
        delivered to the Administrator at least one year before the date on
        which distributions are otherwise scheduled to commence pursuant to the
        Participant's election, and (ii) defers the commencement of
        distributions by at least five years from the originally scheduled
        commencement date.

        Fractional shares shall not be issued, and instead shall be paid out in
cash.

        (d) Crediting of Dividends. Whenever Shares are issued to a Participant
pursuant to Section 9(c) above, such Participant shall also be entitled to
receive, with respect to each Share issued, a cash amount equal to any cash
dividends (plus simple interest at a rate of five percent per annum, or such
other reasonable rate as the Committee may determine), and a number of Shares
equal to any stock



                                      -11-
<PAGE>



dividends which were declared and paid to the holders of Shares between the
Grant Date and the date such Share is issued.

        (e) Emergency Withdrawals. In the event a Participant suffers an
unforeseeable emergency within the contemplation of this Section and Section
409A of the Code, the Participant may apply to the Company for an immediate
distribution of all or a portion of the Participant's Deferred Share Units. The
unforeseeable emergency must result from a sudden and unexpected illness or
accident of the Participant, the Participant's spouse, or a dependent (within
the meaning of Section 152(a) of the Code) of the Participant, casualty loss of
the Participant's property, or other similar extraordinary and unforeseeable
conditions beyond the control of the Participant. Examples of purposes which are
not considered unforeseeable emergencies include post-secondary school expenses
or the desire to purchase a residence. In no event will a distribution be made
to the extent the unforeseeable emergency could be relieved through
reimbursement or compensation by insurance or otherwise, or by liquidation of
the Participant's nonessential assets to the extent such liquidation would not
itself cause a severe financial hardship. The amount of any distribution
hereunder shall be limited to the amount necessary to relieve the Participant's
unforeseeable emergency plus amounts necessary to pay taxes reasonably
anticipated as a result of the distribution. The Committee shall determine
whether a Participant has a qualifying unforeseeable emergency and the amount
which qualifies for distribution, if any. The Committee may require evidence of
the purpose and amount of the need, and may establish such application or other
procedures as it deems appropriate.

        (f) Unsecured Rights to Deferred Compensation. A Participant's right to
Deferred Share Units shall at all times constitute an unsecured promise of the
Company to pay benefits as they come due. The right of the Participant or the
Participant's duly-authorized transferee to receive benefits hereunder shall be
solely an unsecured claim against the general assets of the Company. Neither the
Participant nor the Participant's duly-authorized transferee shall have any
claim against or rights in any specific assets, shares, or other funds of the
Company.

10. Performance Awards

        (a) Performance Units. The Committee may in its discretion grant
Performance Units to any Eligible Person and shall evidence such grant in an
Award Agreement that is delivered to the Participant which sets forth the terms
and conditions of the Award. A Performance Unit is an Award which is based on
the achievement of specific goals with respect to the Company or any Affiliate
or individual performance of the Participant, or a combination thereof, over a
specified period of time. The maximum Performance Unit compensation that may be
paid to any one Participant with respect to any one Performance Period
(hereinafter defined) shall be 450,000 Shares and $2,000,000 in cash.

        (b) Performance Compensation Awards. The Committee may, at the time of
grant of a Performance Unit, designate such Award as a "Performance Compensation
Award" in order that such Award constitutes "qualified performance-based
compensation" under Code Section 162(m), in which event the Committee shall have
the power to grant such Performance Compensation Award upon terms and conditions
that qualify it as "qualified performance-based compensation" within the meaning
of Code Section 162(m). With respect to each such Performance Compensation
Award, the Committee shall establish, in writing within the time required under
Code Section 162(m), a "Performance Period," "Performance Measure(s)", and
"Performance Formula(e)" (each such term being hereinafter defined). Once
established for a Performance Period, the Performance



                                      -12-
<PAGE>


Measure(s) and Performance Formula(e) shall not be amended or otherwise modified
to the extent such amendment or modification would cause the compensation
payable pursuant to the Award to fail to constitute qualified performance-based
compensation under Code Section 162(m).

        A Participant shall be eligible to receive payment in respect of a
Performance Compensation Award only to the extent that the Performance
Measure(s) for such Award are achieved and the Performance Formula(e) as applied
against such Performance Measure(s) determines that all or some portion of such
Participant's Award has been earned for the Performance Period. As soon as
practicable after the close of each Performance Period, the Committee shall
review and certify in writing whether, and to what extent, the Performance
Measure(s) for the Performance Period have been achieved and, if so, determine
and certify in writing the amount of the Performance Compensation Award to be
paid to the Participant and, in so doing, may use negative discretion to
decrease, but not increase, the amount of the Award otherwise payable to the
Participant based upon such performance. The maximum Performance Compensation
Award for any one Participant for any one Performance Period shall be 450,000
Shares and $2,000,000 in cash.

        (c) Definitions.

                (i) "Performance Formula" means, for a Performance Period, one
        or more objective formulas or standards established by the Committee for
        purposes of determining whether or the extent to which an Award has been
        earned based on the level of performance attained or to be attained with
        respect to one or more Performance Measure(s). Performance Formulae may
        vary from Performance Period to Performance Period and from Participant
        to Participant and may be established on a stand-alone basis, in tandem
        or in the alternative.

                (ii) "Performance Measure" means one or more of the following
        selected by the Committee to measure Company, Affiliate, and/or business
        unit performance for a Performance Period, whether in absolute or
        relative terms (including, without limitation, terms relative to a peer
        group or index): basic, diluted, or adjusted earnings per share; sales
        or revenue; earnings before interest, taxes, and other adjustments (in
        total or on a per share basis); basic or adjusted net income; returns on
        equity, assets, capital, revenue or similar measure; economic value
        added; working capital; total shareholder return; and product
        development, product market share, research, licensing, litigation,
        human resources, information services, mergers, acquisitions, sales of
        assets of Affiliates or business units. Each such measure shall be to
        the extent applicable, determined in accordance with generally accepted
        accounting principles as consistently applied by the Company (or such
        other standard applied by the Committee) and, if so determined by the
        Committee, and in the case of a Performance Compensation Award, to the
        extent permitted under Code Section 162(m), adjusted to omit the effects
        of extraordinary items, gain or loss on the disposal of a business
        segment, unusual or infrequently occurring events and transactions and
        cumulative effects of changes in accounting principles. Performance
        Measures may vary from Performance Period to Performance Period and from
        Participant to Participant, and may be established on a stand-alone
        basis, in tandem or in the alternative.

                (iii) "Performance Period" means one or more periods of time (of
        not less than one fiscal year of the Company), as the Committee may
        designate, over which the attainment



                                      -13-
<PAGE>


        of one or more Performance Measure(s) will be measured for the purpose
        of determining a Participant's rights in respect of an Award.

        (d) Deferral Elections. At any time prior to the date that is at least
six months before the close of a Performance Period (or shorter or longer period
that the Committee selects) with respect to an Award of either Performance Units
or Performance Compensation, the Committee may permit a Participant who is a
member of a select group of management or highly compensated employees (within
the meaning of the Code) to irrevocably elect, on a form provided by and
acceptable to the Committee, to defer the receipt of all or a percentage of the
cash or Shares that would otherwise be transferred to the Participant upon the
vesting of such Award. If the Participant makes this election, the cash or
Shares subject to the election, and any associated interest and dividends, shall
be credited to an account established pursuant to Section 9 hereof on the date
such cash or Shares would otherwise have been released or issued to the
Participant pursuant to Section 10(a) or Section 10(b) above.

11.     Taxes

        (a) General. As a condition to the issuance or distribution of Shares
pursuant to the Plan, the Participant (or in the case of the Participant's
death, the person who succeeds to the Participant's rights) shall make such
arrangements as the Company may require for the satisfaction of any applicable
federal, state, local or foreign withholding tax obligations that may arise in
connection with the Award and the issuance of Shares. The Company shall not be
required to issue any Shares until such obligations are satisfied. If the
Committee allows the withholding or surrender of Shares to satisfy a
Participant's tax withholding obligations, the Committee shall not allow Shares
to be withheld in an amount that exceeds the minimum statutory withholding rates
for federal and state tax purposes, including payroll taxes.

        (b) Default Rule for Employees. In the absence of any other arrangement,
an Employee shall be deemed to have directed the Company to withhold or collect
from his or her cash compensation an amount sufficient to satisfy such tax
obligations from the next payroll payment otherwise payable after the date of
the exercise of an Award.

        (c) Special Rules. In the case of a Participant other than an Employee
(or in the case of an Employee where the next payroll payment is not sufficient
to satisfy such tax obligations, with respect to any remaining tax obligations),
in the absence of any other arrangement and to the extent permitted under the
Applicable Law, the Participant shall be deemed to have elected to have the
Company withhold from the Shares or cash to be issued pursuant to an Award that
number of Shares having a Fair Market Value determined as of the applicable Tax
Date (as defined below) equal to the amount required to be withheld. For
purposes of this Section 11, the Fair Market Value of the Shares to be withheld
shall be determined on the date that the amount of tax to be withheld is to be
determined under the Applicable Law (the "Tax Date").

        (d) Surrender of Shares. If permitted by the Committee, in its
discretion, a Participant may satisfy the minimum applicable tax withholding and
employment tax obligations associated with an Award by surrendering Shares to
the Company (including Shares that would otherwise be issued pursuant to the
Award) that have a Fair Market Value determined as of the applicable Tax Date
equal to the amount required to be withheld. In the case of Shares previously
acquired from the Company that are surrendered under this Section 11, such
Shares must have been owned by the



                                      -14-
<PAGE>


Participant for more than six months on the date of surrender (or such longer
period of time the Company may in its discretion require).

        (e) No Liability for Taxes. Neither the Company, the Administrator, nor
their agents and assigns shall have any obligation whatsoever to grant or to
modify any Award in a manner that avoids or minimizes the tax consequences of
Awards, including any taxes that may arise under Sections 409A or 4999 of the
Code.

12.     Non-Transferability of Awards

        (a) General. Except as set forth in this Section 12, or as otherwise
approved by the Committee for a select group of management or highly compensated
Employees, Awards may not be sold, pledged, assigned, hypothecated, transferred
or disposed of in any manner other than by will or by the laws of descent or
distribution. The designation of a beneficiary by a Participant will not
constitute a transfer. An Award may be exercised, during the lifetime of the
holder of an Award, only by such holder, the duly-authorized legal
representative of a disabled Participant, or a transferee permitted by this
Section 12.

        (b) Limited Transferability Rights. Notwithstanding anything else in
this Section 12, the Committee may in its discretion provide in an Award
Agreement that the Award may be transferred by instrument to an inter vivos or
testamentary trust (or other entity) in which the Award is to be passed to
beneficiaries upon the death of the trustor (settlor), or by gift to charitable
institutions, the Participant's "Immediate Family" (as defined below), on such
terms and conditions as the Committee deems appropriate. "Immediate Family"
means any child, stepchild, grandchild, parent, stepparent, grandparent, spouse,
former spouse, sibling, niece, nephew, mother-in-law, father-in-law, son-in-law,
daughter-in-law, brother-in-law, or sister-in-law, and shall include adoptive
relationships.

13.     Adjustments Upon Changes in Capitalization, Merger or Certain Other
        Transactions

        (a) Changes in Capitalization. The Committee shall equitably adjust the
number of Shares covered by each outstanding Award, and the number of Shares
that have been authorized for issuance under the Plan but as to which no Awards
have yet been granted or that have been returned to the Plan upon cancellation,
forfeiture, or expiration of an Award, as well as the price per Share covered by
each such outstanding Award, to reflect any increase or decrease in the number
of issued Shares resulting from a stock-split, reverse stock-split, stock
dividend, combination, recapitalization or reclassification of the Shares, or
any other increase or decrease in the number of issued Shares effected without
receipt of consideration by the Company. In the event of any such transaction or
event, the Committee may provide in substitution for any or all outstanding
Options under the Plan such alternative consideration (including securities of
any surviving entity) as it may in good faith determine to be equitable under
the circumstances and may require in connection therewith the surrender of all
Options so replaced. In any case, such substitution of securities shall not
require the consent of any person who is granted options pursuant to the Plan.
Except as expressly provided herein, no issuance by the Company of shares of
stock of any class, or securities convertible into shares of stock of any class,
shall affect, and no adjustment by reason thereof shall be required to be made
with respect to, the number or price of Shares subject to any Award.

        (b) Dissolution or Liquidation. In the event of the dissolution or
liquidation of the Company other than as part of a Change of Control, each Award
will terminate immediately prior to



                                      -15-
<PAGE>


the consummation of such action, subject to the discretion of the Committee to
exercise any discretion authorized in the case of a Change in Control.

        (c) Change in Control. In the event of a Change in Control (or
beforehand through an Award Agreement or modification of an Award Agreement),
the Committee may in its sole and absolute discretion and authority, without
obtaining the approval or consent of the Company's shareholders or any
Participant (subject to the specific commitments made in any Award Agreement)
with respect to his or her outstanding Awards, take one or more of the following
actions:

                (i) arrange for or otherwise provide that each outstanding Award
        shall be assumed or a substantially similar award shall be substituted
        by a successor corporation or a parent or subsidiary of such successor
        corporation (the "Successor Corporation");

                (ii) accelerate the vesting of Awards for any period that the
        Committee may authorize at the end of which the Committee may provide
        for termination of any unexercised Options or SARs, so that Awards shall
        vest (and, to the extent applicable, become exercisable) as to the
        Shares that otherwise would have been unvested and provide that
        repurchase rights of the Company with respect to Shares issued upon
        exercise of an Award shall lapse as to the Shares subject to such
        repurchase right;

                (iii) arrange or otherwise provide for the payment of cash or
        other consideration to Participants in exchange for the satisfaction and
        cancellation of outstanding Awards; or

                (iv) make such other adjustments or amendments to outstanding
        Awards or this Plan as the Committee deems necessary or appropriate.

        Notwithstanding the above, in the event a Participant holding an Award
assumed or substituted by the Successor Corporation in a Change in Control is
Involuntarily Terminated by the Successor Corporation in connection with, or
within 12 months following consummation of, the Change in Control, then any
assumed or substituted Award held by the terminated Participant at the time of
termination shall accelerate and become fully vested (and exercisable in full in
the case of Options and SARs), and any repurchase right applicable to any Shares
shall lapse in full. The acceleration of vesting and lapse of repurchase rights
provided for in the previous sentence shall occur immediately prior to the
effective date of the Participant's termination.

        (d) Certain Distributions. In the event of any distribution to the
Company's shareholders of securities of any other entity or other assets (other
than dividends payable in cash or stock of the Company) without receipt of
consideration by the Company, the Committee may, in its discretion,
appropriately adjust the price per Share covered by each outstanding Award to
reflect the effect of such distribution.

14. Time of Granting Awards.

        The date of grant ("Grant Date") of an Award shall be the date on which
the Committee makes the determination granting such Award or such other date as
is determined by the Committee, provided that in the case of an ISO, the Grant
Date shall be the later of the date on which the Committee makes the
determination granting such ISO or the date of commencement of the Participant's
employment relationship with the Company.



                                      -16-
<PAGE>


15. Modification of Awards and Substitution of Options.

        (a) Modification, Extension, and Renewal of Awards. Within the
limitations of the Plan and any Award Agreement, the Committee may modify an
Award, to accelerate the rate at which an Option or SAR may be exercised
(including without limitation permitting an Option or SAR to be exercised in
full without regard to the installment or vesting provisions of the applicable
Award Agreement or whether the Option or SAR is at the time exercisable, to the
extent it has not previously been exercised), to accelerate the vesting of any
Award, to extend or renew outstanding Awards, or to accept the cancellation of
outstanding Awards to the extent not previously exercised either for the
granting of new Awards or for other consideration in substitution or replacement
thereof.

        (b) Substitution of Options. Notwithstanding any inconsistent provisions
or limits under the Plan, in the event the Company or an Affiliate acquires
(whether by purchase, merger or otherwise) all or substantially all of
outstanding capital stock or assets of another corporation or in the event of
any reorganization or other transaction qualifying under Section 424 of the
Code, the Committee may, in accordance with the provisions of that Section,
substitute Options for options under the plan of the acquired company provided
(i) the excess of the aggregate fair market value of the shares subject to an
option immediately after the substitution over the aggregate option price of
such shares is not more than the similar excess immediately before such
substitution and (ii) the new Option does not give persons additional benefits,
including any extension of the exercise period.

16. Term of Plan.

        The Plan shall continue in effect for a term of ten (10) years from its
effective date as determined under Section 20 below, unless the Plan is sooner
terminated under Section 17 below.

17. Amendment and Termination of the Plan.

        (a) Authority to Amend or Terminate. Subject to Applicable Laws, the
Board may from time to time amend, alter, suspend, discontinue, or terminate the
Plan.

        (b) Effect of Amendment or Termination. No amendment, suspension, or
termination of the Plan shall materially and adversely affect Awards already
granted unless either it relates to an adjustment pursuant to Section 13 above,
or it is otherwise mutually agreed between the Participant and the Committee,
which agreement must be in writing and signed by the Participant and the
Company. Notwithstanding the foregoing, the Committee may amend the Plan to
eliminate provisions which are no longer necessary as a result of changes in tax
or securities laws or regulations, or in the interpretation thereof.

18. Conditions Upon Issuance of Shares.

        Notwithstanding any other provision of the Plan or any agreement entered
into by the Company pursuant to the Plan, the Company shall not be obligated,
and shall have no liability for failure, to issue or deliver any Shares under
the Plan unless such issuance or delivery would comply with Applicable Law, with
such compliance determined by the Company in consultation with its legal
counsel.



                                      -17-
<PAGE>


19. Reservation of Shares.

        The Company, during the term of this Plan, will at all times reserve and
keep available such number of Shares as shall be sufficient to satisfy the
requirements of the Plan.

20.     Effective Date.

        This Plan shall become effective on the date of its approval by the
Board; provided that this Plan shall be submitted to the Company's shareholders
for approval, and if not approved by the shareholders within one year from the
date of approval by the Board, this Plan and any Awards shall be null, void, and
of no force and effect. Awards granted under this Plan before approval of this
Plan by the shareholders shall be granted subject to such approval and no Shares
shall be distributed before such approval.

21.     Controlling Law.

        All disputes relating to or arising from the Plan shall be governed by
the internal substantive laws (and not the laws of conflicts of laws) of the
State of New York, to the extent not preempted by United States federal law. If
any provision of this Plan is held by a court of competent jurisdiction to be
invalid and unenforceable, the remaining provisions shall continue to be fully
effective.

22. Laws And Regulations.

        (a) U.S. Securities Laws. This Plan, the grant of Awards, and the
exercise of Options and SARs under this Plan, and the obligation of the Company
to sell or deliver any of its securities (including, without limitation,
Options, Restricted Shares, Restricted Share Units, Unrestricted Shares,
Deferred Share Units, and Shares) under this Plan shall be subject to all
Applicable Law. In the event that the Shares are not registered under the
Securities Act of 1933, as amended (the "Act"), or any applicable state
securities laws prior to the delivery of such Shares, the Company may require,
as a condition to the issuance thereof, that the persons to whom Shares are to
be issued represent and warrant in writing to the Company that such Shares are
being acquired by him or her for investment for his or her own account and not
with a view to, for resale in connection with, or with an intent of
participating directly or indirectly in, any distribution of such Shares within
the meaning of the Act, and a legend to that effect may be placed on the
certificates representing the Shares.

        (b) Other Jurisdictions. To facilitate the making of any grant of an
Award under this Plan, the Committee may provide for such special terms for
Awards to Participants who are foreign nationals or who are employed by the
Company or any Affiliate outside of the United States of America as the
Committee may consider necessary or appropriate to accommodate differences in
local law, tax policy or custom. The Company may adopt rules and procedures
relating to the operation and administration of this Plan to accommodate the
specific requirements of local laws and procedures of particular countries.
Without limiting the foregoing, the Company is specifically authorized to adopt
rules and procedures regarding the conversion of local currency, taxes,
withholding procedures and handling of stock certificates which vary with the
customs and requirements of particular countries. The Company may adopt
sub-plans applicable to particular locations and countries.



                                      -18-
<PAGE>

23. No Shareholder Rights. Neither a Participant nor any transferee of a
Participant shall have any rights as a shareholder of the Company with respect
to any Shares underlying any Award until the date of issuance of a share
certificate to a Participant or a transferee of a Participant for such Shares in
accordance with the Company's governing instruments and Applicable Law. Prior to
the issuance of Shares pursuant to an Award, a Participant shall not have the
right to vote or to receive dividends or any other rights as a shareholder with
respect to the Shares underlying the Award, notwithstanding its exercise in the
case of Options and SARs. No adjustment will be made for a dividend or other
right that is determined based on a record date prior to the date the stock
certificate is issued, except as otherwise specifically provided for in this
Plan.

24. No Employment Rights. The Plan shall not confer upon any Participant any
right to continue an employment, service or consulting relationship with the
Company, nor shall it affect in any way a Participant's right or the Company's
right to terminate the Participant's employment, service, or consulting
relationship at any time, with or without Cause.




                                      -19-
<PAGE>



                                  NYMAGIC, INC.
                          2004 LONG-TERM INCENTIVE PLAN

                                   ----------

                             Appendix A: Definitions

                                   ----------

As used in the Plan, the following definitions shall apply:

        "Affiliate" means any entity, including any "parent corporation" or
"subsidiary corporation" within the meaning of Section 424 of the Code, which
together with the Company is under common control within the meaning of Section
414 of the Code.

        "Applicable Law" means the legal requirements relating to the
administration of options and share-based plans under applicable U.S. federal
and state laws, the Code, any applicable stock exchange or automated quotation
system rules or regulations, and the applicable laws of any other country or
jurisdiction where Awards are granted, as such laws, rules, regulations and
requirements shall be in place from time to time.

        "Award" means any award made pursuant to the Plan, including awards made
in the form of an Option, an SAR, a Restricted Share, a Restricted Share Unit, a
Deferred Share Unit and a Performance Award, or any combination thereof, whether
alternative or cumulative, authorized by and granted under this Plan.

        "Award Agreement" means any written document setting forth the terms of
an Award that has been authorized by the Committee. The Committee shall
determine the form or forms of documents to be used, and may change them from
time to time for any reason.

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

        "Cause" for termination of a Participant's Continuous Service will exist
if the Participant is terminated from employment or other service with the
Company or an Affiliate for any of the following reasons:

        (i)    the Participant's willful failure to substantially perform his or
               her duties and responsibilities to the Company or deliberate
               violation of a material Company policy;

        (ii)   the Participant's commission of any material act of fraud,
               embezzlement, dishonesty or any other willful misconduct;

        (iii)  the Participant's material unauthorized use or disclosure by the
               Participant of any proprietary information or trade secrets of
               the Company or any other party to whom the Participant owes an
               obligation of nondisclosure as a result of his or her
               relationship with the Company; or

        (iv)   Participant's willful and material breach of any of his or her
               obligations under any written agreement or covenant with the
               Company.



                                      -20-
<PAGE>



        The Committee shall in its discretion determine as to whether or not a
Participant is being terminated for Cause. The Committee's determination shall,
unless arbitrary and capricious, be final and binding on the Participant, the
Company, and all other affected persons. The foregoing definition does not in
any way limit the Company's ability to terminate a Participant's employment or
consulting relationship at any time, and the term "Company" will be interpreted
herein to include any Affiliate or successor thereto, if appropriate.

        "Change in Control" means any of the following:

        (a) Approval by the stockholders of the Company of the dissolution or
liquidation of the Company;

        (b) Approval by the stockholders of the Company of an agreement to merge
or consolidate, or otherwise reorganize, with or into one or more entities that
are not Affiliates, as a result of which less than 50% of the outstanding voting
securities of the surviving or resulting entity immediately after the
reorganization are, or will be, owned, directly or indirectly, by stockholders
of the Company immediately before such reorganization (assuming for purposes of
such determination that there is no change in the record ownership of the
Company's securities from the record date for such approval until such
reorganization and that such record owners hold no securities of the other
parties to such reorganization), but including in such determination any
securities of the other parties to such reorganization held by Affiliates of the
Company);

        (c) Approval by the stockholders of the Company of the sale of
substantially all of the Company's business and/or assets to a person or entity
that is not an Affiliate of the Company;

        (d) Any "person" (as such term is used in Sections 13(d) and 14(d) of
the Exchange Act but excluding any person described in and satisfying the
conditions of Rule 13d-1(b)(1) thereunder), other than a person that is a
stockholder of the Company on the Effective Date, becomes the beneficial owner
(as defined in Rule 13d-3 under the Exchange Act), directly or indirectly, of
securities of the Company representing more than 50% of the combined voting
power of the Company's then outstanding securities entitled to then vote
generally in the election of directors of the Company; or

               (e) During any period not longer than two consecutive years,
        individuals who at the beginning of such period constituted the Board
        cease to constitute at least a majority thereof, unless the election, or
        the nomination for election by the Company's stockholders, of each new
        Board member was approved by a vote of at least three-fourths of the
        Board members then still in office who were Board members at the
        beginning of such period (including for these purposes, new members
        whose election or nomination was so approved).

        "Code" means the U.S. Internal Revenue Code of 1986, as amended.

        "Committee" means one or more committees or subcommittees of the Board
appointed by the Board to administer the Plan in accordance with Section 4
above. With respect to any decision involving an Award intended to satisfy the
requirements of Section 162(m) of the Code, the Committee shall consist of two
or more Directors of the Company who are "outside directors" within the meaning
of Section 162(m) of the Code.



                                      -21-
<PAGE>


        "Company" means NYMAGIC, Inc., a New York corporation.

        "Consultant" means any person, including an advisor, who is engaged by
the Company or any Affiliate to render services and is compensated for such
services.

        "Continuous Service" means the absence of any interruption or
termination of service as an Employee, Director, or Consultant. Continuous
Service shall not be considered interrupted in the case of: (i) sick leave; (ii)
military leave; (iii) any other leave of absence approved by the Committee,
provided that such leave is for a period of not more than 90 days, unless
reemployment upon the expiration of such leave is guaranteed by contract or
statute, or unless provided otherwise pursuant to Company policy adopted from
time to time; (iv) changes in status from Director to advisory director or
emeritus status; or (iv) in the case of transfers between locations of the
Company or between the Company, its Affiliates or their respective successors.
Changes in status between service as an Employee, Director, and a Consultant
will not constitute an interruption of Continuous Service.

        "Deferred Share Units" mean Awards pursuant to Section 9 of the Plan.

        "Director" means a member of the Board, or a member of the board of
directors of an Affiliate.

        "Disabled" means a condition under which a Participant  --

        (a) is unable to engage in any substantial gainful activity by reason of
any medically determinable physical or mental impairment which can be expected
to result in death or can be expected to last for a continuous period of not
less than 12 months, or

        (b) is, by reason of any medically determinable physical or mental
impairment which can be expected to result in death or can be expected to last
for a continuous period of not less than 12 months, received income replacement
benefits for a period of not less than 3 months under an accident or health plan
covering employees of the Company.

        "Eligible Person" means any Consultant, Director or Employee and
includes non-Employees to whom an offer of employment has been extended.

        "Employee" means any person whom the Company or any Affiliate classifies
as an employee (including an officer) for employment tax purposes. The payment
by the Company of a director's fee to a Director shall not be sufficient to
constitute "employment" of such Director by the Company.

        "Exchange Act" means the Securities Exchange Act of 1934, as amended.

        "Fair Market Value" means, as of any date (the "Determination Date")
means: (i) the closing price of a Share on the New York Stock Exchange or the
American Stock Exchange (collectively, the "Exchange"), on the Determination
Date, or, if shares were not traded on the Determination Date, then on the
nearest preceding trading day during which a sale occurred; or (ii) if such
stock is not traded on the Exchange but is quoted on NASDAQ or a successor
quotation system, (A) the last sales price (if the stock is then listed as a
National Market Issue under The Nasdaq National Market System) or (B) the mean
between the closing representative bid and asked



                                      -22-
<PAGE>



prices (in all other cases) for the stock on the Determination Date as reported
by NASDAQ or such successor quotation system; or (iii) if such stock is not
traded on the Exchange or quoted on NASDAQ but is otherwise traded in the
over-the-counter, the mean between the representative bid and asked prices on
the Determination Date; or (iv) if subsections (i)-(iii) do not apply, the fair
market value established in good faith by the Board.

        "Grant Date" has the meaning set forth in Section 14 of the Plan.

        "Incentive Share Option or ISO" hereinafter means an Option intended to
qualify as an incentive stock option within the meaning of Section 422 of the
Code, as designated in the applicable Award Agreement.

        "Involuntary Termination" means termination of a Participant's
Continuous Service under the following circumstances occurring on or after a
Change in Control: (i) termination without Cause by the Company or an Affiliate
or successor thereto, as appropriate; or (ii) voluntary termination by the
Participant within 60 days following (A) a material reduction in the
Participant's job responsibilities, provided that neither a mere change in title
alone nor reassignment to a substantially similar position shall constitute a
material reduction in job responsibilities; (B) an involuntary relocation of the
Participant's work site to a facility or location more than 50 miles from the
Participant's principal work site at the time of the Change in Control; or (C) a
material reduction in Participant's total compensation other than as part of an
reduction by the same percentage amount in the compensation of all other
similarly-situated Employees, Directors or Consultants.

        "Non-ISO" means an Option not intended to qualify as an ISO, as
designated in the applicable Award Agreement.

        "Option" means any stock option granted pursuant to Section 6 of the
Plan.

        "Participant" means any holder of one or more Awards, or the Shares
issuable or issued upon exercise of such Awards, under the Plan.

        "Performance Awards" mean Performance Units and Performance Compensation
Awards granted pursuant to Section 10.

        "Performance Compensation Awards" mean Awards granted pursuant to
Section 10(b) of the Plan.

        "Performance Unit" means Awards granted pursuant to Section 10(a) of the
Plan which may be paid in cash, in Shares, or such combination of cash and
Shares as the Committee in its sole discretion shall determine.

        "Plan" means this NYMAGIC, Inc. 2004 Long-term Incentive Plan.

        "Reporting Person" means an officer, Director, or greater than ten
percent shareholder of the Company within the meaning of Rule 16a-2 under the
Exchange Act, who is required to file reports pursuant to Rule 16a-3 under the
Exchange Act.

        "Restricted Shares" mean Shares subject to restrictions imposed pursuant
to Section 8 of the Plan.



                                      -23-
<PAGE>


        "Restricted Share Units" mean Awards pursuant to Section 8 of the Plan.

        "Rule 16b-3" means Rule 16b-3 promulgated under the Exchange Act, as
amended from time to time, or any successor provision.

        "SAR" or "Share Appreciation Right" means Awards granted pursuant to
Section 7 of the Plan.

        "Share" means an ordinary voting share of the Company, as adjusted in
accordance with Section 13 of the Plan.

        "Ten Percent Holder" means a person who owns stock representing more
than ten percent (10%) of the combined voting power of all classes of stock of
the Company or any Affiliate.

        "Unrestricted Shares" has the meaning set forth in Section 8 of the
Plan.




                                      -24-
<PAGE>














                                  NYMAGIC, INC.
                              AMENDED AND RESTATED
                          2004 LONG-TERM INCENTIVE PLAN




















                                                    As approved by the Board of
                                                    Directors on February 26,
                                                    2004 and by the shareholders
                                                    on May 26, 2004; as amended
                                                    and restated effective
                                                    December 15, 2004