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                                                                     EXHIBIT 4.4

                     FIRST AMENDMENT AND RESTATEMENT OF THE
                        NATIONAL EQUIPMENT SERVICES, INC.
                          1998 LONG TERM INCENTIVE PLAN


         1.   PURPOSE.

         This plan shall be known as the National Equipment Services, Inc. 1998
Long Term Incentive Plan (the "PLAN"). The purpose of this Plan shall be to
promote the long term growth and profitability of National Equipment Services,
Inc. (the "COMPANY") and its Subsidiaries by (i) providing certain directors,
officers and key employees of, and certain other key individuals who perform
services for, the Company and its Subsidiaries with incentives to maximize
stockholder value and otherwise contribute to the success of the Company and
(ii) enabling the Company to attract, retain and reward the best available
persons for positions of substantial responsibility. Grants of incentive or
nonqualified stock options, stock appreciation rights ("SARS"), either alone or
in tandem with options, restricted stock, performance awards, or any combination
of the foregoing may be made under this Plan.

         2.   DEFINITIONS.

         (a)  "BOARD OF DIRECTORS" and "BOARD" mean the board of directors of
the Company.

         (b)  "CAUSE" means the occurrence of one of the following events:
(i) conviction of a felony or any crime or offense lesser than a felony
involving the property of the Company or a Subsidiary; (ii) conduct that has
caused demonstrable and serious injury to the Company or a Subsidiary,
monetary or otherwise; (iii) willful refusal to perform or substantial
disregard of duties properly assigned, as determined by the Company; or (iv)
breach of duty of loyalty to the Company or a Subsidiary or other act of
fraud or dishonesty with respect to the Company or a Subsidiary.

         (c)  "CHANGE IN CONTROL" means the occurrence of one of the
following events:

              (i)   if any "person" or "group" as those terms are used in
    Sections 13(d) and 14(d) of the Exchange Act is or becomes the
    "beneficial owner" (as defined in Rule 13d- 3 under the Exchange Act),
    directly or indirectly, of securities of the Company representing 50% or
    more of the combined voting power of the Company's then outstanding
    securities;

              (ii)  during any period of two consecutive years, individuals
    who at the beginning of such period constituted the Board and any new
    directors whose election by the Board or nomination for election by the
    Company's stockholders was approved by at least two-thirds of the
    directors then still in office who either were directors at the beginning
    of the period or whose election was previously so approved, cease for any
    reason to constitute a majority thereof;

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              (iii) the stockholders of the Company approve a merger or
    consolidation of the Company with any other corporation, other than a
    merger or consolidation (A) which would result in all or a portion of the
    voting securities of the Company outstanding immediately prior thereto
    continuing to represent (either by remaining outstanding or by being
    converted into voting securities of the surviving entity) more than 50%
    of the combined voting power of the voting securities of the Company or
    such surviving entity outstanding immediately after such merger or
    consolidation or (B) by which the corporate existence of the Company is
    not affected and following which the Company's chief executive officer
    and directors retain their positions with the Company (and constitute at
    least a majority of the Board); or

              (iv)  the stockholders of the Company approve a plan of
    complete liquidation of the Company or an agreement for the sale or
    disposition by the Company of all or substantially all the Company's
    assets.

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

         (e)  "COMMITTEE" means the Compensation Committee of the Board. The
membership of the Committee shall be constituted so as to comply at all times
with the applicable requirements of Rule 16b-3 under the Exchange Act and
Section 162(m) of the Code.

         (f)  "COMMON STOCK" means the Common Stock, par value $.01 per
share, of the Company, and any other shares into which such stock may be
changed by reason of a recapitalization, reorganization, merger,
consolidation or any other change in the corporate structure or capital stock
of the Company.

         (g)  "COMPETITION" is deemed to occur if a person whose employment
with the Company or its Subsidiaries has terminated obtains a position as a
full-time or part-time employee of, as a member of the board of directors of,
or as a consultant or advisor with or to, or acquires an ownership interest
in excess of 5% of, a corporation, partnership, firm or other entity that
engages in any of the businesses of the Company or any Subsidiary with which
the person was involved in a management role at any time during his or her
last five years of employment with or other service for the Company or any
Subsidiary.

         (h)  "EXCHANGE ACT" means the Securities Exchange Act of 1934, as
amended.

         (i)  "FAIR MARKET VALUE" of a share of Common Stock of the Company
means, with respect to the date in question, the officially-quoted closing
selling price of the stock (or if no selling price is quoted, the bid price)
on the principal securities exchange on which the Common Stock is then listed
for trading (including for this purpose The Nasdaq Stock Market) (the
"MARKET") for the immediately preceding trading day or, if the Common Stock
is not then listed or quoted in the Market, the Fair Market Value shall be
the fair value of the Common Stock determined in good faith by the Board;
provided, however, that when shares received upon exercise of an option are
immediately sold in the open market, the Committee

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may use the net sale price received to determine the Fair Market Value of any
shares used to pay the exercise price or withholding taxes and to compute the
withholding taxes.

         (j)  "INCENTIVE STOCK OPTION" means an option conforming to the
requirements of Section 422 of the Code and any successor thereto.

         (k)  "NON-EMPLOYEE DIRECTOR" has the meaning given to such term in
Rule 16b-3 under the Exchange Act.

         (l)  "NONQUALIFIED STOCK OPTION" means any stock option other than
an Incentive Stock Option.

         (m)  "OTHER COMPANY SECURITIES" mean securities of the Company other
than Common Stock, which may include, without limitation, unbundled stock
units or components thereof, debentures, preferred stock, warrants and
securities convertible into or exchangeable for Common Stock or other
property.

         (p)  "PERSON" means a natural person, partnership (whether general
or limited), limited liability company, trust, estate, association,
corporation, custodian, nominee or any other individual or entity in its own
or any representative capacity.

         (n)  "RETIREMENT" means retirement as defined under any Company
pension plan or retirement program or termination of one's employment on
retirement with the approval of the Committee.

         (o)  "SUBSIDIARY" means a corporation or other entity of which
outstanding shares or ownership interests representing 50% or more of the
combined voting power of such corporation or other entity entitled to elect
the management thereof, or such lesser percentage as may be approved by the
Committee, are owned directly or indirectly by the Company.

         3.   ADMINISTRATION.

         This Plan shall be administered by the Committee; provided that the
Board may, in its discretion, at any time and from time to time, resolve to
administer this Plan, in which case the term "COMMITTEE" shall be deemed to
mean the Board for all purposes herein. The Committee shall consist of at
least two Non-Employee Directors (unless the Committee consists of the entire
Board). Subject to the provisions of this Plan, the Committee shall be
authorized to (i) select persons to participate in this Plan, (ii) determine
the form and substance of grants made under this Plan to each participant,
and the conditions and restrictions, if any, subject to which such grants
will be made, (iii) modify the terms of grants made under this Plan, (iv)
interpret this Plan and grants made thereunder, and (v) adopt, amend, or
rescind such rules and regulations, and make such other determinations, for
carrying out this Plan as it may deem appropriate. Decisions of the Committee
on all matters relating to this Plan shall be in the Committee's sole
discretion and shall be conclusive and binding on all parties. The validity,
construction, and effect of this

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Plan and any rules and regulations relating to this Plan shall be determined
in accordance with applicable federal and state laws and rules and
regulations promulgated pursuant thereto. No member of the Committee and no
officer or other director of the Company shall be liable for any action taken
or omitted to be taken by such member, by any other member of the Committee
or by any officer or other director of the Company in connection with the
performance of duties under this Plan, except for such person's own willful
misconduct or as expressly provided by statute.

         The expenses of this Plan shall be borne by the Company. This Plan
shall not be required to establish any special or separate fund or make any
other segregation of assets to assume the payment of any award under this
Plan, and rights to the payment of such awards shall be no greater than the
rights of the Company's general creditors.

         4.   SHARES AVAILABLE FOR THIS PLAN.

         Subject to adjustments as provided in Section 15, an aggregate of
4,461,191 shares of Common Stock (the "SHARES") may be issued pursuant to
this Plan. Such Shares may be in whole or in part authorized and unissued, or
shares which are held by the Company as treasury shares. If any grant under
this Plan expires or terminates unexercised, becomes unexercisable or is
forfeited as to any Shares, such unpurchased or forfeited Shares shall
thereafter be available for further grants under this Plan unless, in the
case of options granted under this Plan, related SARs are exercised.

         Without limiting the generality of the foregoing provisions of this
Section 4 or the generality of the provisions of Sections 3, 6 or 17 or any
other section of this Plan, the Committee may, at any time or from time to
time, and on such terms and conditions (that are consistent with and not in
contravention of the other provisions of this Plan) as the Committee may, in
its sole discretion, determine, enter into agreements (or take other actions
with respect to the options) for new options containing terms (including
exercise prices) more (or less) favorable than the outstanding options.

         5.   PARTICIPATION.

         Participation in this Plan shall be limited to those directors
(including Non-Employee Directors), officers and key employees of, and other
key individuals performing services for, the Company and its Subsidiaries
selected by the Committee. Nothing in this Plan or in any grant thereunder
shall confer any right on a participant to continue in the employ of or the
performance of services for the Company or shall interfere in any way with
the right of the Company to terminate the employment or performance of
services of a participant at any time. By accepting any award under this
Plan, each participant and each person claiming under or through him or her
shall be conclusively deemed to have indicated his or her acceptance and
ratification of, and consent to, any action taken under this Plan by the
Company, the Board or the Committee.

         Incentive Stock Options or Nonqualified Stock Options, SARs , alone
or in tandem with options, restricted stock awards, performance awards, or
any combination thereof, may be granted to such

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persons and for such number of Shares as the Committee shall determine (such
individuals to whom grants are made being sometimes herein called "OPTIONEES"
or "GRANTEES," as the case may be). Determinations made by the Committee
under this Plan need not be uniform and may be made selectively among
eligible individuals under this Plan, whether or not such individuals are
similarly situated. A grant of any type made hereunder in any one year to an
eligible participant shall neither guarantee nor preclude a further grant of
that or any other type to such participant in that year or subsequent years.

         6.   INCENTIVE AND NONQUALIFIED OPTIONS.

         The Committee may from time to time grant to eligible participants
Incentive Stock Options, Nonqualified Stock Options, or any combination
thereof; provided that the Committee may grant Incentive Stock Options only
to eligible employees of the Company or its subsidiaries (as defined for this
purpose in Section 424(f) of the Code). In any one calendar year, the
Committee shall not grant to any one participant, options or SARs to purchase
a number of shares of Common Stock in excess of 500,000 (as adjusted from
time to time pursuant to Section 15). The options granted shall take such
form as the Committee shall determine, subject to the following terms and
conditions.

         It is the Company's intent that Nonqualified Stock Options granted
under this Plan not be classified as Incentive Stock Options, that Incentive
Stock Options be consistent with and contain or be deemed to contain all
provisions required under Section 422 of the Code and any successor thereto,
and that any ambiguities in construction be interpreted in order to
effectuate such intent. If an Incentive Stock Option granted under this Plan
does not qualify as such for any reason, then to the extent of such
nonqualification, the stock option represented thereby shall be regarded as a
Nonqualified Stock Option duly granted under this Plan, provided that such
stock option otherwise meets this Plan's requirements for Nonqualified Stock
Options.

         (a)  PRICE. The price per Share deliverable upon the exercise of
each option ("EXERCISE PRICE") shall be established by the Committee, except
that in the case of the grant of any Incentive Stock Option, the exercise
price may not be less than 100% of the Fair Market Value of a share of Common
Stock as of the date of grant of the option, and in the case of the grant of
any Incentive Stock Option to an employee who, at the time of the grant, owns
more than 10% of the total combined voting power of all classes of stock of
the Company or any of its Subsidiaries, the exercise price may not be less
that 110% of the Fair Market Value of a share of Common Stock as of the date
of grant of the option, in each case unless otherwise permitted by Section
422 of the Code.

         (b)  PAYMENT. Options may be exercised, in whole or in part, upon
payment of the exercise price of the Shares to be acquired. Unless otherwise
determined by the Committee, payment shall be made (i) in cash (including
check, bank draft or money order), (ii) by delivery of outstanding shares of
Common Stock with a Fair Market Value on the date of exercise equal to the
aggregate exercise price payable with respect to the options' exercise, (iii)
by simultaneous sale through a broker reasonably acceptable to the Committee
of Shares acquired on exercise, as permitted under Regulation T of the
Federal Reserve Board, (iv) by authorizing the Company to withhold from
issuance a number of Shares

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issuable upon exercise of the options which, when multiplied by the Fair
Market Value of a share of Common Stock on the date of exercise is equal to
the aggregate exercise price payable with respect to the options so exercised
or (v) by any combination of the foregoing. Options may also be exercised
upon payment of the exercise price of the Shares to be acquired by delivery
of the optionee's promissory note, but only to the extent specifically
approved by and in accordance with the policies of the Committee.

         In the event a grantee elects to pay the exercise price payable with
respect to an option pursuant to clause (ii) above, (A) only a whole number
of share(s) of Common Stock (and not fractional shares of Common Stock) may
be tendered in payment, (B) such grantee must present evidence acceptable to
the Company that he or she has owned any such shares of Common Stock tendered
in payment of the exercise price (and that such tendered shares of Common
Stock have not been subject to any substantial risk of forfeiture) for at
least six months prior to the date of exercise, and (C) Common Stock must be
delivered to the Company. Delivery for this purpose may, at the election of
the grantee, be made either by (A) physical delivery of the certificate(s)
for all such shares of Common Stock tendered in payment of the price,
accompanied by duly executed instruments of transfer in a form acceptable to
the Company, or (B) direction to the grantee's broker to transfer, by book
entry, such shares of Common Stock from a brokerage account of the grantee to
a brokerage account specified by the Company. When payment of the exercise
price is made by delivery of Common Stock, the difference, if any, between
the aggregate exercise price payable with respect to the option being
exercised and the Fair Market Value of the share(s) of Common Stock tendered
in payment (plus any applicable taxes) shall be paid in cash. No grantee may
tender shares of Common Stock having a Fair Market Value exceeding the
aggregate exercise price payable with respect to the option being exercised
(plus any applicable taxes).

         In the event a grantee elects to pay the exercise price payable with
respect to an option pursuant to clause (iv) above, (A) only a whole number
of Share(s) (and not fractional Shares) may be withheld in payment and (B)
such grantee must present evidence acceptable to the Company that he or she
has owned a number of shares of Common Stock at least equal to the number of
Shares to be withheld in payment of the exercise price (and that such owned
shares of Common Stock have not been subject to any substantial risk of
forfeiture) for at least six months prior to the date of exercise. When
payment of the exercise price is made by withholding of Shares, the
difference, if any, between the aggregate exercise price payable with respect
to the option being exercised and the Fair Market Value of the Share(s)
withheld in payment (plus any applicable taxes) shall be paid in cash. No
grantee may authorize the withholding of Shares having a Fair Market Value
exceeding the aggregate exercise price payable with respect to the option
being exercised (plus any applicable taxes). Any withheld Shares shall no
longer be issuable under such option.

         (c)  TERMS OF OPTIONS. The term during which each option may be
exercised shall be determined by the Committee, but, except as otherwise
provided herein, in no event shall an option be exercisable in whole or in
part (i) in the case of a Nonqualified Stock Option or an Incentive Stock
Option (other than as described below), more than ten years and one day from
the date it is granted or (ii) in the case of an Incentive Stock Option, ten
years from the date it is granted; provided, that, in the case of an
Incentive Stock Option granted to an employee who at the time of the grant
owns more than 10% of the

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total combined voting power of all classes of stock of the Company or any of
its Subsidiaries, in no event shall such option be exercisable, if required
by the Code, more than five years from the date it is granted. All rights to
purchase Shares pursuant to an option shall, unless sooner terminated, expire
at the date designated by the Committee. The Committee shall determine the
date on which each option shall become exercisable and may provide that an
option shall become exercisable in installments. The Shares constituting each
installment may be purchased in whole or in part at any time after such
installment becomes exercisable, subject to such minimum exercise
requirements as may be designated by the Committee. Unless otherwise provided
herein or in the terms of the related grant, an optionee may exercise an
option only if he or she is, and has been continuously since the date the
option was granted, a director, officer or employee of, or performed other
services for, the Company or a Subsidiary. Prior to the exercise of an option
and delivery of the Shares represented thereby, the optionee shall have no
rights as a stockholder with respect to any Shares covered by such
outstanding option (including any dividend or voting rights).

         (d)  LIMITATIONS ON GRANTS. If required by the Code, the aggregate
Fair Market Value (determined as of the grant date) of Shares for which an
Incentive Stock Option is exercisable for the first time during any calendar
year under all equity incentive plans of the Company and its Subsidiaries (as
defined in Section 422 of the Code) may not exceed $100,000.

         (e)  TERMINATION OF EMPLOYMENT.

                (i) If a participant ceases to be a director, officer or
    employee of, or to perform other services for, the Company or any
    Subsidiary upon the occurrence of his or her Retirement, (A) all of the
    participant's options and SARs that were exercisable on the date of
    Retirement shall remain exercisable for, and shall otherwise terminate at
    the end of, a period of up to three years after the date of Retirement,
    but in no event after the expiration date of the options or SARs;
    provided that the participant does not engage in Competition during such
    three-year period unless he or she receives written consent to do so from
    the Board or the Committee, and (B) all of the participant's options and
    SARs that were not exercisable on the date of Retirement shall be
    forfeited immediately upon such cessation. Notwithstanding the foregoing,
    Incentive Stock Options not exercised by such participant within 90 days
    after Retirement will cease to qualify as Incentive Stock Options and
    will be treated as Nonqualified Stock Options under this Plan if required
    to be so treated under the Code.

               (ii) If a participant ceases to be a director, officer or
    employee of, or to perform other services for, the Company or a
    Subsidiary due to Cause, all of the participant's options and SARs shall
    be forfeited immediately upon such cessation, whether or not then
    exercisable.

              (iii) Unless otherwise determined by the Committee, if a
    participant ceases to be a director, officer or employee of, or to
    otherwise perform services for, the Company or a Subsidiary for any
    reason other than Retirement or Cause, (A) all of the participant's
    options and

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    SARs that were exercisable on the date of such cessation shall remain
    exercisable for, and shall otherwise terminate at the end of, a period of
    90 days after the date of such cessation, but in no event after the
    expiration date of the options or SARs; provided that the participant
    does not engage in Competition during such 90-day period unless he or she
    receives written consent to do so from the Board or the Committee, and
    (B) all of the participant's options and SARs that were not exercisable
    on the date of such cessation shall be forfeited immediately upon such
    cessation.

         (f)  GRANT OF RELOAD OPTIONS. The Committee may provide (either at
the time of grant or exercise of an option), in its discretion, for the grant
to a grantee who exercises all or any portion of an option ("EXERCISED
OPTIONS") and who pays all or part of such exercise price with shares of
Common Stock, of an additional option (a "RELOAD OPTION") for a number of
shares of Common Stock equal to the sum (the "RELOAD NUMBER") of the number
of shares of Common Stock tendered or withheld in payment of such exercise
price for the Exercised Options plus, if so provided by the Committee, the
number of shares of Common Stock, if any, tendered or withheld by the grantee
or withheld by the Company in connection with the exercise of the Exercised
Options to satisfy any federal, state or local tax withholding requirements.
The terms of each Reload Option, including the date of its expiration and the
terms and conditions of its exercisability and transferability, shall be the
same as the terms of the Exercised Option to which it relates, except that
(i) the grant date for each Reload Option shall be the date of exercise of
the Exercised Option to which it relates and (ii) the exercise price for each
Reload Option shall be the Fair Market Value of the Common Stock on the grant
date of the Reload Option.

         7.   STOCK APPRECIATION RIGHTS.

         The Committee shall have the authority to grant SARs under this
Plan, either alone or to any optionee in tandem with options (either at the
time of grant of the related option or thereafter by amendment to an
outstanding option). SARs shall be subject to such terms and conditions as
the Committee may specify.

         No SAR may be exercised unless the Fair Market Value of a share of
Common Stock of the Company on the date of exercise exceeds the exercise
price of the SAR or, in the case of SARs granted in tandem with options, any
options to which the SARs correspond. Prior to the exercise of the SAR and
delivery of the cash and/or Shares represented thereby, the participant shall
have no rights as a stockholder with respect to Shares covered by such
outstanding SAR (including any dividend or voting rights).

         SARs granted in tandem with options shall be exercisable only when,
to the extent and on the conditions that any related option is exercisable.
The exercise of an option shall result in an immediate forfeiture of any
related SAR to the extent the option is exercised, and the exercise of an SAR
shall cause an immediate forfeiture of any related option to the extent the
SAR is exercised.

         Upon the exercise of an SAR, the participant shall be entitled to a
distribution in an amount equal to the difference between the Fair Market
Value of a share of Common Stock of the Company on

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the date of exercise and the exercise price of the SAR or, in the case of
SARs granted in tandem with options, any option to which the SAR is related,
multiplied by the number of Shares as to which the SAR is exercised. The
Committee shall decide whether such distribution shall be in cash, in Shares
having a Fair Market Value equal to such amount, in Other Company Securities
having a Fair Market Value equal to such amount or in a combination thereof.

         All SARs will be exercised automatically on the last day prior to
the expiration date of the SAR or, in the case of SARs granted in tandem with
options, any related option, so long as the Fair Market Value of a share of
the Company's Common Stock on that date exceeds the exercise price of the SAR
or any related option, as applicable. An SAR granted in tandem with options
shall expire at the same time as any related option expires and shall be
transferable only when, and under the same conditions as, any related option
is transferable.

         8.   RESTRICTED STOCK.

         The Committee may at any time and from time to time grant Shares of
restricted stock under this Plan to such participants and in such amounts as
it determines. Each grant of restricted stock shall specify the applicable
restrictions on such Shares, the duration of such restrictions (which shall
be at least six months except as otherwise provided in the third paragraph of
this Section 8), and the time or times at which such restrictions shall lapse
with respect to all or a specified number of Shares that are part of the
grant.

         The participant will be required to pay the Company the aggregate
par value of any Shares of restricted stock (or such larger amount as the
Board may determine to constitute capital under Section 154 of the Delaware
General Corporation Law, as amended) within ten days of the date of grant,
unless such Shares of restricted stock are treasury shares. Unless otherwise
determined by the Committee, certificates representing Shares of restricted
stock granted under this Plan will be held in escrow by the Company on the
participant's behalf during any period of restriction thereon and will bear
an appropriate legend specifying the applicable restrictions thereon, and the
participant will be required to execute a blank stock power therefor. Except
as otherwise provided by the Committee, during such period of restriction the
participant shall have all of the rights of a holder of Common Stock,
including but not limited to the rights to receive dividends and to vote, and
any stock or other securities received as a distribution with respect to such
participant's restricted stock shall be subject to the same restrictions as
then in effect for the restricted stock.

         Except as otherwise provided by the Committee, at such time as a
participant ceases to be a director, officer or employee of, or to otherwise
perform services for, the Company and its Subsidiaries due to Retirement
during any period of restriction, all restrictions on Shares granted to such
participant shall lapse. At such time as a participant ceases to be a
director, officer or employee of, or to otherwise perform services for, the
Company or its Subsidiaries for any other reason, all Shares of restricted
stock granted to such participant on which the restrictions have not lapsed
shall be immediately forfeited to the Company.

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         9.   PERFORMANCE AWARDS.

         Performance awards may be granted on a contingent basis to
participants at any time and from time to time as determined by the
Committee. The Committee shall have complete discretion in determining the
size and composition of performance awards so granted to a participant and
the appropriate period over which performance is to be measured (a
"PERFORMANCE CYCLE"). Performance awards may include (i) specific
dollar-value target awards (ii) performance units, the value of each such
unit being determined by the Committee at the time of issuance, and/or (iii)
performance Shares, the value of each such Share being equal to the Fair
Market Value of a share of the Company's Common Stock.

         The value of each performance award may be fixed or it may be
permitted to fluctuate based on a performance factor (e.g., return on equity)
selected by the Committee.

         The Committee shall establish performance goals and objectives for
each performance cycle on the basis of such criteria and objectives as the
Committee may select from time to time, including, without limitation, the
performance of the participant, the Company, one or more of its Subsidiaries
or divisions or any combination of the foregoing. During any performance
cycle, the Committee shall have the authority to adjust the performance goals
and objectives for such cycle for such reasons as it deems equitable.

         The Committee shall determine the portion of each performance award
that is earned by a participant on the basis of the Company's performance
over the performance cycle in relation to the performance goals for such
cycle. The earned portion of a performance award may be paid out in Shares,
cash, Other Company Securities, or any combination thereof, as the Committee
may determine.

         A participant must be a director, officer or employee of, or
otherwise perform services for, the Company or its Subsidiaries at the end of
the performance cycle in order to be entitled to payment of a performance
award issued in respect of such cycle; provided, however, that, except as
otherwise determined by the Committee, if a participant ceases to be a
director, officer or employee of, or to otherwise perform services for, the
Company and its Subsidiaries upon his or her Retirement prior to the end of
the performance cycle, the participant shall earn a proportionate portion of
the performance award based upon the elapsed portion of the performance cycle
and the Company's performance over that portion of such cycle.

         10.  WITHHOLDING TAXES.

         (a)  PARTICIPANT ELECTION. Unless otherwise determined by the
Committee, a participant may elect to deliver shares of Common Stock (or have
the Company withhold shares acquired upon exercise of an option or SAR or
deliverable upon grant or vesting of restricted stock, as the case may be) to
satisfy, in whole or in part, the amount the Company is required to withhold
for taxes in connection with the exercise of an option or SAR or the delivery
of restricted stock upon grant or vesting, as the case may be. Such election
must be made on or before the date the amount of tax to be withheld is
determined.

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Once made, the election shall be irrevocable. The fair market value of the
shares to be withheld or delivered will be the Fair Market Value as of the
date the amount of tax to be withheld is determined. In the event a
participant elects to deliver shares of Common Stock pursuant to this Section
10(a), such delivery must be made subject to the conditions and pursuant to
the procedures set forth in Section 6(b) with respect to the delivery of
Common Stock in payment of the exercise price of options.

         (b)  COMPANY REQUIREMENT. The Company may require, as a condition to
any grant or exercise under this Plan or to the delivery of certificates for
Shares issued hereunder, that the grantee make provision for the payment to
the Company, either pursuant to Section 10(a) or this Section 10(b), of any
federal, state or local taxes of any kind required by law to be withheld with
respect to any grant or any delivery of Shares. The Company, to the extent
permitted or required by law, shall have the right to deduct from any payment
of any kind (including salary or bonus) otherwise due to a grantee, an amount
equal to any federal, state or local taxes of any kind required by law to be
withheld with respect to any grant or to the delivery of Shares under this
Plan, or to retain or sell without notice a sufficient number of the Shares
to be issued to such grantee to cover any such taxes, the payment of which
has not otherwise been provided for in accordance with the terms of this
Plan; provided that the Company shall not sell any such Shares if such sale
would be considered a sale by such grantee for purposes of Section 16 of the
Exchange Act that is not exempt from matching thereunder.

         11.  WRITTEN AGREEMENT; VESTING.

         Each employee to whom a grant is made under this Plan shall enter
into a written agreement with the Company that shall contain such provisions,
including without limitation vesting requirements, consistent with the
provisions of this Plan, as may be approved by the Committee. Unless the
Committee determines otherwise, no grant under this Plan may be exercised,
and no restrictions relating thereto may lapse, within six months of the date
such grant is made.

         12.  TRANSFERABILITY.

         Unless the Committee determines otherwise, no option, SAR,
performance award, or restricted stock granted under this Plan shall be
transferable by a participant otherwise than by will or the laws of descent
and distribution or pursuant to a qualified domestic relations order as
defined by the Code. Unless the Committee determines otherwise, an option,
SAR, or performance award may be exercised only by the optionee or grantee
thereof or his guardian or legal representative; provided that Incentive
Stock Options may be exercised by such guardian or legal representative only
if permitted by the Code and any regulations promulgated thereunder.

         13.  LISTING, REGISTRATION AND QUALIFICATION.

         If the Committee determines that the listing, registration or
qualification upon any securities exchange or under any law of Shares subject
to any option, SAR, performance award or restricted stock grant is necessary
or desirable as a condition of, or in connection with, the granting of same
or the issue or

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<PAGE>


purchase of Shares thereunder, no such option or SAR may be exercised in
whole or in part, no such performance award may be paid out and no Shares may
be issued unless such listing, registration or qualification is effected free
of any conditions not acceptable to the Committee.

         It is the intent of the Company that this Plan comply in all
respects with Section 162(m) of the Code, that awards made hereunder comply
in all respects with Rule 16b-3 under the Exchange Act, that any ambiguities
or inconsistencies in construction of this Plan be interpreted to give effect
to such intention and that if any provision of this Plan is found not to be
in compliance with Section 162(m), such provision shall be deemed null and
void to the extent required to permit this Plan to comply with Section
162(m), as the case may be.

         14.  TRANSFER OF EMPLOYEE.

         The transfer of an employee from the Company to a Subsidiary, from a
Subsidiary to the Company, or from one Subsidiary to another shall not be
considered a termination of employment; nor shall it be considered a
termination of employment if an employee is placed on military or sick leave
or such other leave of absence which is considered by the Committee as
continuing intact the employment relationship.

         15.  ADJUSTMENTS.

         In the event of a reorganization, recapitalization, stock split,
stock dividend, combination of shares, merger, consolidation, distribution of
assets, or any other change in the corporate structure or shares of the
Company, the Committee shall make such adjustment as it deems appropriate in
the number and kind of Shares or other property reserved for issuance under
this Plan, in the number and kind of Shares or other property covered by
grants previously made under this Plan, and in the exercise price of
outstanding options and SARs. Any such adjustment shall be final, conclusive
and binding for all purposes of this Plan. In the event of any merger,
consolidation or other reorganization in which the Company is not the
surviving or continuing corporation or in which a Change in Control is to
occur, all of the Company's obligations regarding options, SARs, performance
awards, and restricted stock that were granted hereunder and that are
outstanding on the date of such event shall, on such terms as may be approved
by the Committee prior to such event, be (i) assumed by the surviving or
continuing corporation, (ii) canceled in exchange for property (including
cash), and/or (iii) in the case of options, SARs, performance awards, and
restricted stock which are not vested, either (A) canceled for no
consideration or payment of any kind or (B) vested and canceled in exchange
for property (including cash).

         Without limitation of the foregoing, in connection with any
transaction of the type specified by clause (iii) of the definition of a
Change in Control in Section 2(c), the Committee may, in its discretion, (i)
cancel any or all outstanding options under this Plan in consideration for
payment to the holders thereof of an amount equal to the portion of the
consideration that would have been payable to such holders pursuant to such
transaction if their options had been fully exercised immediately prior to
such transaction, less the aggregate exercise price that would have been
payable therefor, or (ii) if the amount that would

                                     - 12 -

<PAGE>

have been payable to the option holders pursuant to such transaction if their
options had been fully exercised immediately prior thereto would be less than
the aggregate exercise price that would have been payable therefor, cancel
any or all such options for no consideration or payment of any kind. Payment
of any amount payable pursuant to the preceding sentence may be made in cash
or, in the event that the consideration to be received in such transaction
includes securities or other property, in cash and/or securities or other
property in the Committee's discretion.

         16.  TERMINATION AND MODIFICATION OF THIS PLAN.

         The Board of Directors or the Committee, without further approval of
the stockholders, may modify or terminate this Plan, except that no
modification shall become effective without prior approval of the
stockholders of the Company if stockholder approval would be required for
continued compliance with the performance-based compensation exception of
Section 162(m) of the Code or any listing requirement of the principal stock
exchange on which the Common Stock is then listed.

         17.  AMENDMENT OR SUBSTITUTION OF AWARDS UNDER THIS PLAN.

         The terms of any outstanding award under this Plan may be amended
from time to time by the Committee in its discretion in any manner that it
deems appropriate (including, but not limited to, acceleration of the date of
exercise of any award and/or payments thereunder or of the date of lapse of
restrictions on Shares); provided that, except as otherwise provided in
Section 15, no such amendment shall adversely affect in a material manner any
right of a participant under the award without his or her written consent.
The Committee may, in its discretion, permit holders of awards under this
Plan to surrender outstanding awards in order to exercise or realize rights
under other awards, or in exchange for the grant of new awards, or require
holders of awards to surrender outstanding awards as a condition precedent to
the grant of new awards under this Plan.

         18.  COMMENCEMENT DATE; TERMINATION DATE.

         The date of commencement of this Plan shall be April 28, 1998,
subject to approval by the shareholders of the Company. In February 2000, the
Committee approved the first amendment and restatement of this Plan, subject
to stockholder approval. Unless previously terminated upon the adoption of a
resolution of the Board terminating this Plan, this Plan shall terminate at
the close of business on April 28, 2008; provided that the Board may, prior
to such termination, extend the term of this Plan for up to five years for
the grant of awards other than Incentive Stock Options. No termination of
this Plan shall materially and adversely affect any of the rights or
obligations of any person, without his or her consent, under any grant of
options or other incentives theretofore granted under this Plan.

         19.  GOVERNING LAW.

         The corporate laws of the State of Delaware will govern all
questions concerning this Plan to the extent such laws are applicable to this
Plan. All other questions concerning the construction, validity

                                     - 13 -

<PAGE>

and interpretation of this Plan will be governed by and construed in
accordance with the domestic laws of the State of Illinois, without giving
effect to any choice of law or conflict of law provision or rule (whether of
the State of Illinois or any other jurisdiction) that would cause the
application of the laws of any jurisdiction other than the State of Illinois.

                                  *  *  *  *  *



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