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                                                                 Exhibit 10.18


                               The Penn Traffic Company
                                           
                           1997 Performance Incentive Plan
                                           

1.  Purposes of the Plan.

         This Performance Incentive Plan, first adopted November 21, 1996 and
amended and restated as of April 1, 1997, shall be known as "The Penn Traffic
Company 1997 Performance Incentive Plan" (hereinafter referred to as the
"Plan").  The purposes of the Plan are to further the long-term growth of The
Penn Traffic Company (the "Corporation"), to the benefit of its stockholders, by
providing incentives to the officers, employees and independent contractors of
the Corporation and its subsidiaries who will be largely responsible for such
growth, and to assist the Corporation and its subsidiaries in attracting and
retaining executives of experience and ability on a basis competitive with
industry practices.  The Plan permits the Corporation to provide incentive
compensation of the types commonly known as restricted stock, stock options and
phantom stock, as well as other types of incentive compensation.  For purposes
of this Plan, "Award" shall mean and include any Option, SAR, Restricted Stock,
Common Stock granted as a bonus or in lieu of other awards, other Stock-Based
Award, Tax Bonus, or other cash payments granted to a participant under the
Plan.

2.  Administration of the Plan.

         The Plan shall be administered by the Personnel and Compensation
Committee of the Board of Directors of the Corporation (the "Committee"). 
Subject to the provisions of the Plan, the Committee shall have exclusive power
to select the officers, employees and independent contractors of the Corporation
and its subsidiaries to participate in the Plan; to determine the type, size and
terms of Awards to be made to each participant selected, to determine whether,
to what extent, and under what circumstances an Award may be settled, or the
exercise price of an Award may be paid, in cash, Common Stock, other Awards or
other property, or an Award may be cancelled, forfeited, or surrendered; to
determine whether, and to certify that, performance goals to which the
settlement of an Award is subject are satisfied; to correct any defect or supply
any omission or reconcile any inconsistency in the Plan, and to adopt, amend and
rescind such rules and regulations as, in its opinion, may be advisable in the
administration of the Plan; and to make all other determinations as it may deem
necessary or advisable for the administration of the Plan.  The Committee's
interpretation of the Plan, any Awards granted thereunder or any Award
Agreements shall be final and binding on all parties concerned, including the
Corporation and any participant.  Any action of the Committee in administering
the Plan shall be final, conclusive and binding on all persons, including the
Corporation, its subsidiaries, employees, participants, persons claiming rights
from or through participants and stockholders of the Corporation.
 
3.  Participation.

         Participants in the Plan shall be selected by the Committee from among
the officers, employees and independent contractors of the Corporation and its
subsidiaries.  The term "subsidiary" shall mean any corporation, partnership,
joint venture or other business entity a majority of whose outstanding voting
securities is beneficially owned, directly or indirectly, by the Corporation. 
Participants may receive multiple Awards under the Plan.
 
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4.  Awards.

    (a)  Types.  Awards under the Plan may include, but need not be limited to,
cash and/or shares of the Corporation's common stock, $1.25 par value ("Common
Stock"), rights to receive cash and/or shares of Common Stock, and options
("Options") to purchase shares of Common Stock, including options designated as
qualifying as incentive stock options ("Incentive Stock Options" or "ISOs")
under Section 422 of the Internal Revenue Code of 1986, as amended ("Code"), and
options not intended so to qualify.  The terms of any Option granted under the
Plan as an ISO shall comply in all respects with the provisions of Section 422
of the Code, including, but not limited to, the requirement that no ISO shall be
granted more than ten years after the effective date of the Plan.  The Committee
may also make any other type of Award deemed by it to be consistent with the
purposes of the Plan.

    (b)  Vesting, Performance Requirements and Forfeiture.  In granting any
Awards, the Committee (1) may specify that the right to exercise such Awards or
the right to receive payment of such cash and/or shares of Common Stock or to
retain any shares of Common Stock so transferred shall be conditional upon the
fulfillment of specified conditions, including, without limitation, completion
of specified periods of service in the employ of the Corporation or its
subsidiaries, and the achievement of specified business and/or personal
performance goals, and (2) may provide for the forfeiture of all or any portion
of any such Awards in specified circumstances.  The Committee may also specify
by whom and/or in what manner the accomplishment of any such performance goals
shall be determined.

    (c)  Agreements.  Awards under the Plan shall be evidenced by an agreement
(an "Award Agreement"), which, subject to the provisions of the Plan, may
contain such terms and conditions as may be approved by the Committee, and shall
be executed by an officer on behalf of the Corporation and by the recipient of
the Award.

5.  Shares of Stock Subject to the Plan.

         Subject to adjustment as provided in Section 7(a) hereof, the number
of shares of Common Stock which may be paid to participants under the Plan
and/or purchased pursuant to Options granted under the Plan shall not exceed an
aggregate of one million five hundred thousand (1,500,000) shares.  In the event
that any shares of Common Stock subject to an Award are forfeited or such Award
is settled in cash or otherwise terminated for any reason without an actual
distribution of shares of Common Stock to the participant, such shares may again
be awarded under the Plan.  If the terms of any Award allow a participant to
acquire or receive payment with regard to a stated number or maximum number of
shares of Common Stock by alternatively exercising Options or receiving cash
and/or shares pursuant to other forms of Awards or forfeiting without
consideration any Restricted Stock (whether or not any of the foregoing shall
have been granted at the same or at a different time), the total number of
shares of Common Stock which shall be deemed granted shall be limited to only
the maximum number which can be so acquired or received.  Shares to be delivered
or purchased under the Plan may be either authorized but unissued shares of
Common Stock or shares of Common Stock held by the Corporation as treasury
shares.

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6.  Options and Other Awards.

    (a)  Term of Options.  The term of any Option shall be determined by the
Committee, but in no event shall any Option designated as an Incentive Stock
Option be exercisable more than ten years after the date on which it was
granted.

    (b)  Option Price; Fair Market Value.  The price ("Option Price") at which
shares of Common Stock may be purchased pursuant to any Option shall be
determined by the Committee at the time the Option is granted, but in no event
shall the Option Price be less than 100 per cent of the Fair Market Value of
such shares on the date the Option is granted.  For all purposes of the Plan,
"Fair Market Value" is the mean of the high and low sales prices of the Common
Stock on the relevant date as reported on the stock exchange or market on which
the Common Stock is primarily traded, or, if no sale is made on such date, then
"Fair Market Value" is a weighted average of the mean of the high and low sales
prices of the Common Stock on the next preceding day and the next succeeding day
on which such sales were made as reported on the stock exchange or market on
which the Common Stock is primarily traded.  

    (c)  Payment Upon Exercise.  The Committee shall determine the time or
times at which an Option may be exercised in whole or in part, whether the
Option Price shall be paid in cash or by the surrender at Fair Market Value of
Common Stock, or by any combination of cash and shares of Common Stock,
including, without limitation, cash, Common Stock, other Awards, or other
property (including notes or other contractual obligations of participants to
make payment on a deferred basis, such as through "cashless exercise"
arrangements, to the extent permitted by applicable law), and the methods by
which Common Stock will be delivered or deemed to be delivered to participants. 
Upon exercise of an Option, the Option Price shall be payable to the Corporation
in cash, or, at the discretion of the Committee, in shares of Common Stock
valued at the Fair Market Value thereof on the date of payment, or in a
combination of cash and shares of Common Stock.

    (d)  Surrender of Options.  The Corporation may, if the Committee so
determines, accept the surrender by a participant, or the personal
representative of a participant, of an Option, in consideration of a cash
payment by the Corporation equal to the difference obtained by subtracting the
aggregate Option Price from the aggregate Fair Market Value of the Common Stock
covered by the Option on the date of such surrender, or partly in shares of
Common Stock and partly in cash.

    (e)  Restricted Stock.  The Committee is authorized to award shares of
Common Stock which are, in accordance with this Section 6(e), subject to
restrictions and a risk of forfeiture ("Restricted Stock") to participants on
the following terms and conditions: 

         (i)  Restricted Period.  Restricted Stock awarded to a participant
shall be subject to such restrictions on transferability and other restrictions
for such periods as shall be established by the Committee, in its discretion, at
the time of such Award, which restrictions may lapse separately or in
combination at such times, under such circumstances, or otherwise, as the
Committee may determine.

         (ii)  Forfeiture.  Restricted Stock shall be forfeitable to the
Corporation upon termination of employment during the applicable restricted
periods.  The Committee, in its 

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discretion, whether in an Award Agreement or anytime after an Award is made, 
may accelerate the time at which restrictions or forfeiture conditions will 
lapse or remove any such restrictions, including upon death, disability or 
retirement, whenever the Committee determines that such action is in the best 
interests of the Corporation.

         (iii)  Certificates for Stock.  Restricted Stock granted under the
Plan may be evidenced in such manner as the Committee shall determine.  If
certificates representing Restricted Stock are registered in the name of the
participant, such certificates may bear an appropriate legend referring to the
terms, conditions and restrictions applicable to such Restricted Stock.

         (iv)  Rights as a Shareholder.  Subject to the terms and conditions of
the Award Agreement, the participant shall have all the rights of a stockholder
with respect to shares of Restricted Stock awarded to him or her, including,
without limitation, the right to vote such shares and the right to receive all
dividends or other distributions made with respect to such shares.  If any such
dividends or distributions are paid in Common Stock, the Common Stock shall be
subject to restrictions and a risk of forfeiture to the same extent as the
Restricted Stock with respect to which the Common Stock has been distributed.

    (f)  Stock Appreciation Rights.  The Committee is authorized to grant to
participants a right ("Stock Appreciation Rights" or "SARs") to receive, upon
exercise thereof, the excess of (A) the Fair Market Value of one share of Common
Stock on the date of exercise over (B) the grant price of the SAR as determined
by the Committee as of the date of grant of the SAR, which grant price (except
as provided in Section 6(j)) shall not be less than the Fair Market Value of one
share of Common Stock on the date of grant.  The Committee shall determine the
time or times at which an SAR may be exercised in whole or in part, the method
of exercise, method of settlement, form of consideration payable in settlement,
method by which Common Stock will be delivered or deemed to be delivered to
participants, whether or not an SAR shall be in tandem with any other Award, and
any other terms and conditions of any SAR.  

    (g)  Bonus Stock and Awards in Lieu of Cash Obligations.  The Committee is
authorized to grant Common Stock as a bonus, or to grant Common Stock or other
Awards in lieu of Corporation or subsidiary obligations to pay cash or deliver
other property under other plans or compensatory arrangements; provided that, in
the case of participants subject to Section 16 of the Securities Exchange Act of
1934, as amended (the "Exchange Act"), such cash amounts are determined under
such other plans in a manner that complies with applicable requirements thereof
and of the rules promulgated pursuant thereto so that the acquisition of Common
Stock or Awards hereunder shall be exempt from Section 16(b) liability.  Common
Stock or Awards granted hereunder shall be subject to such other terms as shall
be determined by the Committee.

    (h)  Other Stock-Based Awards.  The Committee is authorized, subject to
limitations under applicable law, to grant to participants rights denominated or
payable in, or valued in whole or in part by reference to the market value of,
Common Stock ("Stock-Based Awards"), including, but not limited to, any Option,
SAR, Restricted Stock, Common Stock granted as a bonus or Awards in lieu of cash
obligations, as deemed by the Committee to be consistent with the purposes of
the Plan.  The Committee shall determine the terms and conditions of such
Stock-Based Awards.  Common Stock delivered pursuant to an Award in the nature
of a purchase right granted under this Section 6(h) shall be purchased for such

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consideration and paid for at such times, by such methods, and in such forms
including, without limitation, cash, Common Stock, other Awards, or other
property, as the Committee shall determine.

    (i)  Cash Payments and Tax Bonuses.  The Committee is authorized to grant
cash payments to participants, whether awarded separately or as a supplement to
any Award.  The Committee is further authorized, subject to limitations under
applicable law, to grant to a participant a payment in cash, in the year in
which an amount is included in the gross income of a participant in respect of
an Award, of an amount equal to the federal, foreign, if any, and applicable
state and local income and employment tax liabilities payable by the participant
as a result of (i) the amount included in gross income in respect of the Award
and (ii) the payment of the amount in clause (i) and the amount in this clause
(ii) (a "Tax Bonus").  For purposes of determining the amount to be paid to a
participant as a Tax Bonus, the participant shall be deemed to pay federal,
foreign, if any, and state and local income taxes at the highest marginal rate
of tax imposed upon ordinary income for the year in which an amount in respect
of the Award is included in gross income, after giving effect to any deductions
therefrom or credits available with respect to the payment of any such taxes. 
The Committee shall determine the terms and conditions of such Awards of Tax
Bonuses and other cash payments.

    (j)  Additional Provisions Applicable to Awards

         (i)  Stand-Alone, Additional, Tandem, and Substitute Awards.  Awards
granted under the Plan may, in the discretion of the Committee, be granted
either alone or in addition to, in tandem with, or in substitution for, any
other Award granted under the Plan or any award granted under any other plan of
the Corporation or any subsidiary, or any business entity acquired by the
Corporation or any subsidiary, or any other right of a participant to receive
payment from the Corporation or any subsidiary (all of the foregoing being
referred to for purposes of this subparagraph (j) as "Awards").  If an Award is
granted in substitution for another Award, the Committee shall require the
surrender of such other Award in consideration for the grant of the new Award. 
Awards granted in addition to, or in tandem with other Awards may be granted
either as of the same time as, or a different time from, the grant of such other
Awards.  The per share Option Price of any Option, grant price of any SAR, or
purchase price of any other Award conferring a right to purchase Common Stock:

        (A) granted in substitution for an outstanding Award, shall be 
     not less than the lesser of (A) the Fair Market Value of a share of 
     Common Stock at the date such substitute Award is granted or (B) 
     such Fair Market Value at that date, reduced to reflect the Fair 
     Market Value at that date of the Award required to be surrendered 
     by the participant as a condition to receipt of the substitute 
     Award; or

        (B) retroactively granted in tandem with an outstanding Award, 
     shall not be less than the lesser of the Fair Market Value of a 
     share of Common Stock at the date of grant of the later Award or at 
     the date of grant of the earlier Award.

        (ii) Exchange and Buy Out Provisions.  The Committee may at any time
offer to exchange or buy out any previously granted Award for a payment in cash,
Common Stock, other Awards (subject to clause (i) of this Section 6(j)), or
other property based on 

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such terms and conditions as the Committee shall determine and communicate to 
a participant at the time that such offer is made.

         (iii)  Performance Conditions.  The right of a participant to exercise
or receive a grant or settlement of any Award, and the timing thereof, may be
subject to such performance conditions as may be specified by the Committee.

         (iv)  Term of Awards.  The term of each Award shall, except as
provided herein, be for such period as may be determined by the Committee;
provided, however, that in no event shall the term of any ISO, or any SAR
granted in tandem therewith, exceed a period of ten years from the date of its
grant (or such shorter period as may be applicable under Section 422 of the
Code).

         (v)  Form of Payment.  Subject to the terms of the Plan and any
applicable agreement with a participant, payments or transfers to be made by the
Corporation or a subsidiary upon the grant or exercise of an Award may be made
in such forms as the Committee shall determine, including, without limitation,
cash, Common Stock, other Awards, or other property (and may be made in a single
payment or transfer, in installments, or on a deferred basis), in each case
determined in accordance with rules adopted by, and at the discretion of, the
Committee.  (Such payments may include, without limitation, provisions for the
payment or crediting of reasonable interest on installments or deferred
payments.)  The Committee, in its discretion, may accelerate any payment or
transfer upon a change in control as defined by the Committee.  The Committee
may also authorize payment upon the exercise of an Option by net issuance or
other cashless exercise methods.

         (vi) Loan Provisions.  With the consent of the Committee, and subject
at all times to laws and regulations and other binding obligations or provisions
applicable to the Corporation, the Corporation may make, guarantee, or arrange
for a loan or loans to a participant with respect to the exercise of any Option
or other payment in connection with any Award, including the payment by a
participant of any or all federal, foreign, if any, state, or local income or
other taxes due in connection with any Award.  Subject to such limitations, the
Committee shall have full authority to decide whether to make a loan or loans
hereunder and to determine the amount, terms, and provisions of any such loan or
loans, including the interest rate to be charged in respect of any such loan or
loans, whether the loan or loans are to be with or without recourse against the
borrower, the terms on which the loan is to be repaid and the conditions, if
any, under which the loan or loans may be forgiven.

         (vii)  Change of Control.  In the event of a Change of Control of the
Corporation, all Awards granted under the Plan (including Performance-Based
Awards, as defined below)  that are still outstanding and not yet vested or
exercisable or which are subject to restrictions shall become immediately 100%
vested in each participant or shall be free of any restrictions, as of the first
date that the definition of Change of Control has been fulfilled, and shall be
exercisable for the remaining duration of the Award.  All Awards that are
exercisable as of the effective date of the Change of Control will remain
exercisable for the remaining duration of the Award.  A "Change of Control"
shall mean an event or series of events by which (i) any "person" (as such term
is used in Section 13(d) and 14(d) of the Exchange Act) (other than Riverside
Acquisition Company, Limited Partnership ("RAC"), Miller Tabak Hirsch + Co.
("MTH") or any Affiliate of either thereof) is or becomes the "beneficial owner"
(as defined in Rules 13d-3 and 13d-5 under the Exchange Act, except that a
person shall be deemed to have "beneficial ownership" of all shares that any
such person 

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has the right to acquire, whether such right is exercisable immediately or 
only after the passage of time), directly or indirectly, of 50% or more of 
the outstanding shares of Common Stock of the Corporation or securities 
representing 50% or more of the combined voting power of the Corporation's 
voting securities, (ii) the Corporation consolidates with or merges into 
another corporation or conveys, transfers or leases all or substantially all 
of its assets to any person, or any corporation consolidates with or merges 
into the Corporation, in each case pursuant to a transaction (other than a 
transaction between the Corporation and its subsidiaries)

(A) after giving effect to which persons who were Directors of the Corporation
immediately prior to the transaction do not constitute a majority of the Board
of Directors of the successor or survivor entity and (B) in which the
outstanding voting securities of the Corporation are changed into or exchanged
for cash, securities or other property, with the effect that all or
substantially all of the individuals and entities who were the respective
beneficial owners of the common stock and voting securities of the Company
immediately prior to such reorganization, merger or consolidation do not,
following such reorganization, merger or consolidation, beneficially own,
directly or indirectly, more than fifty percent (50%) of the then outstanding
shares of common stock and of the combined voting power of the then outstanding
voting securities entitled to vote generally in the election of directors of the
corporation resulting from such reorganization, merger or consolidation, or
(iii) during any period of two consecutive years, individuals who at the
beginning of such period constituted the Corporation's Board of Directors
(together with any new or replacement directors whose election by the
Corporation's Board of Directors, or whose nomination for election by the
Corporation's shareholders was approved by a vote of at least a majority of the
directors then still in office who were either directors at the beginning of
such period or whose election or nomination for election was previously so
approved), cease for any reason to constitute a majority of the directors then
in office.  

         (viii)  Awards to Comply with Section 162(m).  The Committee may (but
is not required to) grant an Award pursuant to the Plan to a participant who, in
the year of grant, may be a "covered employee," within the meaning of Section
162(m) of the Code, which is intended to qualify as "performance-based
compensation" under Section 162(m) of the Code (a "Performance-Based Award"). 
The right to receive a Performance-Based Award, other than Options and SARs
granted at not less than Fair Market Value, shall be conditional upon the
achievement of performance goals established by the Committee in writing at the
time such Performance-Based Award is granted.  Such performance goals, which may
vary from participant to participant and from Performance-Based Award to
Performance-Based Award, shall be based upon the attainment by the Corporation
or any subsidiary, division or department of specific amounts of, or increases
in, one or more of the following, any of which may be measured either in
absolute terms or as compared to another company or companies:  revenues,
earnings, earnings per share, operating income, cash flow, net worth, book
value, stockholders' equity, financial return ratios, market performance and/or
total stockholder return.  Before any compensation pursuant to a
Performance-Based Award is paid, the Committee shall certify in writing that the
performance goals applicable to the Performance-Based Award were in fact
satisfied.  
 
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         The maximum amount which may be granted as Performance-Based Awards to
any participant in any calendar year shall not exceed (i) Stock-Based Awards for
500,000 shares of Common Stock (whether payable in cash or Common Stock),
subject to adjustment as provided in Section 7(a) hereof, (ii) a Tax Bonus
payable with respect to the Stock-Based Awards described in clause (i) and (iii)
cash payments (other than Tax Bonuses) of $500,000.  

7.  Dilution and Other Adjustments.

    (a)  Changes in Capital Structure.  In the event of any subdivision or
combination of the outstanding shares of Common Stock, stock dividend, capital
reorganization, liquidation, reclassification of shares, merger, consolidation,
or sale, lease or transfer of substantially all of the assets of the
Corporation, the Board of Directors of the Corporation shall make such equitable
adjustments as it may deem appropriate in the Plan and the Awards thereunder,
including, without limitation, any adjustment in the total number of shares of
Common Stock which may thereafter be delivered or purchased under the Plan. 
Agreements evidencing Options may include such provisions as the Committee may
deem appropriate with respect to the adjustments to be made to the terms of such
Options upon the occurrence of any of the foregoing events.

    (b)  Tender Offers and Exchange Offers.  In the event of any tender offer
or exchange offer, by any person other than the Corporation, for shares of
Common Stock, the Committee may make such adjustments in outstanding Awards and
authorize such further action as it may deem appropriate to enable the
recipients of outstanding awards to avail themselves of the benefits of such
offer, including, without limitation, acceleration of the exercise date of
outstanding Options so that they become immediately exercisable in whole or in
part, or offering to acquire all or any portion of specified categories of
Options for a price determined pursuant to Section 6(d) hereof, or acceleration
of the payment of outstanding awards payable, in whole or in part, in shares of
Common Stock.

     (c)  Other Events.  In addition, the Committee is authorized to make
adjustments in the terms and conditions of, and the criteria included in, Awards
in recognition of unusual or nonrecurring events (including, without limitation,
events described in the preceding subparagraphs) affecting the Corporation or
any subsidiary, or in response to changes in applicable laws, regulations, or
accounting principles.  Notwithstanding the foregoing, no adjustment shall be
made which would cause the Plan or any outstanding Option to violate Section
422(b)(1) of the Code with respect to ISOs or would adversely affect the status
of a  Performance-Based Award as "performance-based compensation" under Section
162(m) of the Code.   

8.  Miscellaneous Provisions.

    (a)  Right to Awards.  No employee or other person shall have any claim or
right to be granted any Award under the Plan.

    (b)  No Assurance of Employment.  Neither the Plan nor any action taken
thereunder shall be construed as giving any employee any right to be retained in
the employ of the Corporation or any subsidiary.

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    (c)  Costs and Expenses.  All costs and expenses incurred in administering
the Plan shall be borne by the Corporation.

    (d)  Unfunded Plan.  The Plan shall be unfunded.  The Corporation shall not
be required to establish any special or separate fund nor to make any other
segregation of assets to assure the payment of any Award under the Plan.

    (e)  Withholding Taxes.  The Corporation shall have the right to deduct
from all Awards hereunder paid in cash any federal, state, local or foreign
taxes required by law to be withheld with respect to such payments and, with
respect to Awards paid in Common Stock, to require the payment (through
withholding from the employee's salary or otherwise) of any such taxes, but the
Committee may make such arrangements for the payment of such taxes as the
Committee in its discretion shall determine, including payment with shares of
Common Stock.

    (f)  Assignment or Transfer.  No Awards under the Plan nor any rights or
interests therein shall be assignable or transferable by the recipient thereof
except, in the event of a participant's death, to his designated beneficiary as
hereinafter provided, or by will or the laws of descent and distribution. 
During the lifetime of the participant, Awards under the Plan requiring exercise
shall be exercisable only by such holder or by the guardian or legal
representative of such holder.  Notwithstanding the foregoing, the Committee
may, in its discretion, provide that Awards or other rights or interests of a
participant granted pursuant to the Plan (other than an ISO) be transferable,
without consideration, to immediate family members (i.e., children,
grandchildren or spouse), to trusts for the benefit of such immediate family
members and to partnerships in which such family members are the only partners. 
The Committee may attach to such transferability feature such terms and
conditions as it deems advisable.  In addition, a participant may, in the manner
established by the Committee, designate a beneficiary (which may be a person or
a trust) to exercise the rights of the participant, and to receive any
distribution, with respect to any Award upon the death of the participant.  A
beneficiary, guardian, legal representative or other person claiming any rights
under the Plan from or through any participant shall be subject to all terms and
conditions of the Plan and any Award Agreement applicable to such participant,
except as otherwise determined by the Committee, and to any additional
restrictions deemed necessary or appropriate by the Committee.

    (g)  Nature of Benefits.  Awards under the Plan, and payments made pursuant
thereto, are not a part of salary or base compensation.

    (h)  Compliance with Legal Requirements.  The obligation of the Corporation
to issue or deliver shares of Common Stock upon exercise of Options or otherwise
shall be subject to satisfaction of all applicable legal and securities exchange
requirements, including, without limitation, the provisions of the Securities
Act of 1933, as amended, and the Exchange Act.  The Corporation shall endeavor
to satisfy all such requirements in such a manner as to permit at all times the
exercise of all outstanding Options in accordance with their terms and to permit
the issuance and delivery of shares of Common Stock whenever provided for by the
terms of any award made under the Plan.
 
                                -9-

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    (i)  Discretion.  In exercising, or declining to exercise, any grant of
authority or discretion hereunder, the Committee may consider or ignore such
factors or circumstances and may accord such weight to such factors and
circumstances as the Committee alone and in its sole judgment deems appropriate
and without regard to the effect such exercise, or declining to exercise such
grant of authority or discretion, would have upon the affected participant, any
other participant, any employee, the Corporation, any subsidiary, any
stockholder or any other person.

9.  Amendment or Termination of the Plan.

         The Board of Directors of the Corporation, without the consent of any
participant, may at any time terminate or from time to time amend the Plan in
whole or in part, provided, however, that no such action shall adversely affect
any rights or obligations with respect to any Awards theretofore made under the
Plan, and provided further, that no amendment, without approval of the holders
of Common Stock by an affirmative vote of a majority of the shares of Common
Stock voted thereon in person or by proxy, shall (i) increase the aggregate
number of shares subject to the Plan (other than increases pursuant to Section 7
hereof), (ii) increase the maximum term for which Options may be issued under
the Plan, (iii) decrease the minimum Option Price at which ISOs may be issued
under the Plan, or (iv) materially modify the requirements for eligibility to
participate in the Plan.  The Committee may amend outstanding agreements
evidencing Awards under the Plan, and may amend the terms of Awards not
evidenced by such agreements, in any manner not inconsistent with the terms of
the Plan.  The Committee may waive any conditions or rights under, or amend,
alter, suspend, discontinue, or terminate, any Award theretofore granted and any
Award Agreement relating thereto; provided, however, that without the consent of
an affected participant, no such amendment, alteration, suspension,
discontinuation, or termination of any Award may materially and adversely affect
the rights of such participant under such Award.

         The foregoing notwithstanding, any performance condition specified in
connection with an Award shall not be deemed a fixed contractual term, but shall
remain subject to adjustment by the Committee, in its discretion at any time in
view of the Committee's assessment of the Corporation's strategy, performance of
comparable companies, and other circumstances, except to the extent that any
such adjustment to a performance condition would adversely affect the status of
a Performance-Based Award as "performance-based compensation" under Section
162(m) of the Code.  

10. Effective Date and Term of Plan.

         This Plan shall be effective as of November 21, 1996, and shall be
submitted for approval by the stockholders of the Corporation at the 1997 Annual
Meeting of Stockholders.  Unless otherwise specified in the terms of any
particular Award when such Award is made, any Award granted after the effective
date hereof and prior to the submission of this Plan for approval by the
stockholders of the Corporation at the 1997 Annual Meeting of Stockholders shall
continue to be outstanding and may be exercised in accordance with its terms;
provided, however, that if this Plan shall be disapproved by the stockholders of
the Corporation at the 1997 Annual Meeting of Stockholders, no Award shall be
made hereunder after the date of such disapproval.  The Plan shall terminate at
the close of business on the date on which all of the shares of Common Stock
provided for under the Plan have been used, unless sooner terminated by action
of the Board of Directors of the Corporation.  No 

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Award may be granted hereunder after termination of the Plan, but such 
termination shall not affect the validity of any award then outstanding.

11. Law Governing.

         The validity and construction of the Plan and any agreements entered
into thereunder shall be governed by the laws of the State of New York, but
without regard to the conflict laws of the State of New York, except to the
extent that such conflict laws require application of the laws of the State of
Delaware.

















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